8th Parliament · 2nd Session
Mr. Speaker (Hon. Sir Elliot Johnson) took the chair at 3 p.m., and read prayers.
– In view of the general election that is looming in the near future, I desire to ask the Prime Minister whether the Government still intend to give the House an opportunity to consider Bills providing for referenda on proposed amendments of the Constitution to extend the legislative powers of the Commonwealth Parliament ?
– Questions of this class are quite outside the category of those which ought to be asked without notice. I wish to say, on behalf of my colleagues and myself, that we do not propose to answer any of them.
– I desire to ask the Prime Minister, without notice-
– The Prime Minister has already said that the Government do not propose to answer to-day any questions without notice.
– I thought that the right honorable gentleman was referring only to questions of the type asked by the honorable member for Melbourne Ports (Mr. Mathews).
Mr.CORSER asked the Prime Minister, upon notice -
Are owners of fat stock, owing to the publication of the intention of the Government to introduce the Meat Export Bounties Bill, selling to the meat works at 12s. per 100 lbs. delivered in Brisbane, on condition that they receive the id. per lb. export bounty?
If bo, will he cause provision to be made that the bounty be paid on any fat stock so sold since the notification of the Bill ?
– A measure embracing the terms of the Meat Export Bounty Bill is already before the House, and at this juncture it is not deemed advisable to anticipate the said measure by a specific answer to this question.
asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister for Trade and Customs, upon notice -
– The answers to the honorable member’s questions are as follow : - 1 and 2. The position of the hop industry of Australia has received the continuous consideration of the Government. On the enactment of the Tariff on 28th March, . 1920, action was taken to increase the duty from lid. to 1 s. The following statement shows the importation of hops of American origin from July, 1021, to June, 1922. inclusive: -
Owing to the dissimilar conditions existing, within Australia and America, in connexion with the manufacture of products- from hops, the Government is giving careful consideration to the question of further safeguarding the local industry.
asked the Minister for Works and Railways, upon notice -
Mr.RICHARD FOSTER. - The answers to the honorable member’s questions are as follow: -
asked the AttorneyGeneral, upon notice -
– The answers to the honorable member’s questions are as follow : - 1 and 2. It is understood that anomalies exist owing to the diverse laws in the several States.
– On the 10th inst. the honorable member for Wide Bay (Mr. Corser) asked the following questions, upon notice -
I am now able to furnish the honorable member with the following information in reply to question 2 : -
– On 3rd inst. the honorable member for Echuca (Mr. Hill) asked the following questions: -
I am now able to furnish the honorable member with the following information : -
The following papers were presented : -
Cockatoo Island Dockyard - Report on the first year’s operations at Cockatoo Island since its transfer to the Prime Minister’s Department on 29th June, 1921.
Defence - Australian Military Forces - Report of the Inspector-General (LieutGeneral Sir H. G. Chauvel, G.C.M.G., K.C.B.), Part I., 31st May, 1922.
Ordered to be printed.
Defence Act - Regulations Amended - Statutory Rules 1922, No. 102.
Invalid and Old-age Pensions Act - Statement for 1921-22.
Lands Acquisition Act - Land acquired under, at-
Bargo, New South Wales - For Defence purposes.
Clermont, Queensland - For Postal purposes.
Public Service Act - Promotion of H. J. Drosten, Department of the Treasury.
Seat of Government Acceptance Act and Seat of Government (Administration) Act - Ordinance of 1922 - No. 4 - Vine and Vegetation Diseases and Fruit Pests.
Motion (by Mr. Hughes) agreed to -
That leave be given to bring- in a Bill for an Act to enable effect to be given to two Treaties signed at Washington on behalf of His Majesty and certain other Powers.
Bill presented, and read a first time.
Kidman and Mayoh’s Shipbuilding Contract - Sugar Control : Administration - Northern Territory : Reemployment of Dismissed Railway employee - Pairs .
Message recommending appropriation reported.
Question - “ That the message be referred to the Committee of Supply,” proposed from the Chair.
.- I move-
That all the words after “ That “ be left out with a view to insert in lieu thereof the words: - “the Government is deserving of censure on account of its action in submitting to a secret inquiry the question of the ELidmanMayoh shipbuilding contract, which had already been inquired into and reported on by the Parliamentary Public Works Committee.”
I propose, very briefly, to place before the . House my reasons for moving this amendment, and to give nothing bub the essential facts connected with, this contract, so that every honorable member may know exactly what has happened in regard to’ it. During the year 1918 the Government let a number of contracts for the building of wooden ships. Amongst the many contractors was ° the firm of Messrs. Kidman and Mayoh, who contracted to build six such vessels, and by the year 1919, they had made some progress with the construction of two of them. The other four they had not touched. When the war ceased, the Government decided to relieve the various contractors of their contracts, and compensate them, and in respect of the four ships which Kidman and Mayoh had not commenced, the Government paid them £13,000 each, or a total of £52,000. The contractors asked to be allowed to finish the other two vessels, the Braeside and the Burnside. In other words, they preferred not to take £26,000 in compensation for the cancellation of the order for the construction of those two vessels. I wish to make that point clear in refutation of the statement that is sometimes made that the building of these two vessels was a war-time measure. The war was over at this stage, and the contract was simply a business transaction. At one stage during the course of construction, the Government had arranged to sell the ships to Burns, Philp and Company. One of the ships, the Braeside, was launched in due course with much ceremony, but immediately following the launching, it was discovered that the vessel had developed what is known in shipping parlance as a “hog.” The launching was a failure, and because of the “hog,” and the fact that the contractors could not get Lloyd’s Al certificate, which they had undertaken to get, Burns, Philp and Company became suspicious. They made inquiries, and soon discovered that the ships had not been built in accordance with the agreement and plans and specifications, that a number of dummy bolts had been used where through bolts were specified, and, generally, that the whole work of construction was slummed from start to finish. Upon these grounds, Burns Philp and Company refused to proceed with the purchase, and they were supported in that attitude by statements made by workmen employed on the job that the work had been slummed. The contractors, finding that they could not get Lloyd’s certificate, asked the Government to relieve them of their contract. They said in effect, “We undertook to build these vessels in accordance with plans and specifications approved by Lloyd’s and to get Lloyd’s Al certificate. We have failed to deliver the goods, and we ask to be relieved of our contrast.” Honorable members are aware of what followed. The contractors approached the Government and said that they would be satisfied if the Public Works Committee were asked to decide whether or not they were to be relieved of their contract, and, if so, upon what terms. I do not desire to conceal anything in connexion with the charge I am bringing against the Government, so I shall read to the House an’ extract from a letter which the company wrote to the Government, and in which they gave a. definite undertaking to abide by the decision of the Public Works Committee. That letter showed that the contractors had in mind the possibility that, if such an inquiry were not held, there would be costly arbitration and possibly litigation. The contractors wrote -
If the Commonwealth Government took over the work, it might reasonably be assumed that they could complete the vessels to their own satisfaction, and obviate the necessity for protracted delays which must occur to secure a settlement of the many points at present in dispute. Some of these would mean submission to arbitration, and possibly litigation.
There is a clear statement that they desired to obviate arbitration and litigation, and they proceeded -
It is suggested for consideration that if the Government can see its way clear to relieve us of our contract, we would urge that the matter be referred to the Parliamentary Public Works Committee, with a view to their making a report on the whole question, and considering the question of the amount of compensation which might be allowed us. If the Government can see its way clear to meet our . request we hereby undertake to abide by the decision of the Public Works Committee, whatever it may be/
The contractors stated in unambiguous terms that if the question were handed over to the Public Works Committee they would abide by the decision of that body. The Public Works Committee undertook the inquiry. No member of the Committee was a shipping expert, but we thought it our bounden duty in the public interest, before completing the inquiry, to bring to our aid the best shipping experts in the Commonwealth. I claim that we had one in Mr. Farquhar, who, at that time was manager for the firm of Walkers Limited, Maryborough, and who had previously been offered employment by the Commonwealth, but refused it on account of the salary offered. He has since, however, been appointed chief executive officer in connexion with the Commonwealth shipbuilding activities, and that is proof of his expert qualifications and ability. We obtained all the advice and assistance we could get from the Government officials, and the Committee paid several visits to the ships themselves. So that honorable members may know I am not exaggerating when I say that the ships were “ slummed over,” I shall read extracts from the Committee’s findings in their report. This is very important from my point of view, because I think it necessary that honorable members should know exactly the method of the construction of these vessels. The paragraph I am about to read from the Committee’s report is based on the definite statement made by Mr. Farquhar as follows : -
The plans for the construction of the vessels were prepared by Messrs. Kay, Macnicol and Company, of Sydney, with whom was Mr. A. C. Barber. Naval Architect, who was mainly responsible for the design. It was originally proposed to build the ships entirely to the requirements of the Navigation Department and the Underwriters’ ‘Society, but a few weeks prior to the signing of the contract the Chief Executive Officer (Mr. Curchin) insisted upon the plans conforming to Lloyd’s Al classification. It thereforebecame necessary to submit the plans to Lloyd’s Registry, London. It is usual, under such circumstances, to send to Lloyd’s a midship section, showing the principal shantlings, but in this instance the Naval Architect, Mr. Barber, chose to forward three other plans, one showing the fastenings, another the details of the floors, and another the general profile, so that there might be a clear understanding with Lloyd’s as to what was required. In due course, these plans were returned approved by Lloyd’s, subject to certain modifications.
In other words, Lloyd’s said that if the ships were built according to plans and specifications there would be no difficulty in obtaining an Al certificate. The following is from, the report of the Committee -
Thereafter there appears to have been no systematic method adopted by cither the Contractors or the ‘Ship Construction Branch to sec that all plans were submitted for approval, duly signed as approved, and copies in duplicate furnished to the Department. Sometimes alterations were indicated by correspondence; at other times, according to Mr. Joseph Mayoh’s own statement, he took plans to Melbourne, discussed them with the Chief Executive Officer, and returned with them, and there was nothing in writing to show the decision arrived at.
Apparently, when Mr. Mayoh desired any alteration made in the plans -he simply came to Melbourne, and, on returning, said he had seen Mr. Curchin, who had marked something in red ink and given his approval. It would seem that the Government management was so bad that there was no one to check any action of Mr. Mayoh; there was no definite supervision by anybody employed by the Government - nobody seemed to care whether the plans were altered or not.
– Were not alterations initialed by the Government’s representatives 1
– Sometimes, but more often they were not-. The edge-fastenings are those things which hold a ship together, and the alterations in regard to these were not initialed by the Government’s representatives, although the contractor said that they had the authority of those representatives for alterations made. This not only shows that the contractors were not prepared to do the fair thing, but that there was no effective Government supervision. While the contractors are to be condemned for “ slumming “ these vessels, and showing absolute recklessness in regard to the safety of human life - about the greatest indictment that could be presented against them - the Government cannot be excused for their lack of anykind of definite supervision.
– The Government had a man there looking after the work.
– The honorable member ceased to . be a member of the Works Committee about that time.
– I saw this case out, and had as much to do with it as any one on the Committee.
– The honorable member knows what happened to that- man.
– He committed suicide.
– Quite so. When the inquiry started, and the Government’s supervisor found that the work had been “ slummed over,” he was so incensed at the whole thing that he took his own life. This is’ a sad aspect of the matter, which, perhaps, I should have forgotten but for the interjection of the honorable member.
– I wished to show that the Government had some one there; whereas the honorable member said there was no one.
– The Government had a representative, but he carried out his work in such a way, and was evidently so upset at the lack of supervision, that he committed suicide.
– He was deceived, anyhow.
– Yes; the contractors had a. way of deceiving people. They represented that every safeguard was taken to construct these ships in accordance with, plans and specifications, and this man, when he found that he had been misled, took his own life.
One serious aspect of the case is connected with a plan called 706 A. This was a most important plan, and was, along with others, sent over to Lloyd’s. It showed that through fastenings and edge fastenings were in the ship, and Lloyd’s said that if the plans were correct they would approve of the certificate. But it. was found out afterwards that 80 per cent, of these edge fastenings had been omitted. This is about the most serious indictment that could be made, not only against the contractors, but also against the Government; and honorable members cannot shut their eyes to the fact. This omission was nothing short of criminal, and, as the present Postmaster-General (Mr. Poynton), who was then- Minister for Shipping, said when speaking in the House, those concerned ought to be in gaol. In a little while I shall show what consideration was given to these people, who, according to a Minister, ought to be in gaol .
I come now to the statement of the shipping expert, Mr. Farquhar, who is now employed by the Government, and whose ability is net doubted. Members of the Public Works Committee knew very little about shipping, but I shall read extracts from Mr. Farquhar’s report to the Committee in case any honorable member may have a doubt as to the construction of these vessels. In the early part of his report he says -
In accordance with the attached copy of resolution of your Committee, desiring that I should undertake on their behalf an examination of the two wooden vessels Braeside and Burnside now being constructed for the Commonwealth Government by Messrs. Kidman and Mayoh, I have to report as follows : -
He tells how he met members of the Committee on the boat, and provided them, with ship knives, long, thin-bladed knives, which were used to pass through the work in order to ascertain whether the bolts went right through, to connect the timbers. These are the bolts the absence of which, according to this expert, would have sent the vessels to the bottom of the sea if they had gone outside the Heads, and he reported that 80 per cent. - of them were missing. Honorable members will understand the position better if I quote exactly what he fold the Committee in his report -
On the Monday following he went down to the Braeside, and found that the contractors had not carried out his instructions^ - that is to say, they had decided not to give him a chance of seeing these omissions. This is what Mr. Farquhar reported upon the matter -
I expressed myself rather strongly, and gave them clearly to understand that, unless they at once carried out my instructions in a thorough manner and as quickly as possible, the only conclusion I would come to would be that there were very few edge fastenings in the ship, and I would be compelled to report accordingly.
He compelled them to obey his instructions, and the reason why they had not done so before was made obvious, because he found that the edge fastenings shown on the plans were not in the Braeside. He said in his report -
I had no idea there was a shipwright living who would do such a dastardly thing. . . . I cannot, believe that the builders gave any such instructions.
When the whole work was laid bare to him his opinion was expressed as follows : -
Since the foregoing was written on my visit to the Braeside on 22nd December, Mr. Watson and his officers showed me 106 bolts in the hold ceiling which had been pointed out to them by two shipwrights, who said they knew them to be dummy bolts, whereas they were intended to represent through fastenings. These bolts had every appearance of through bolts, being all fitted with washers, and appeared as if they had been clenched on the washers.
– Have you any estimate of what the contractors saved by these dummies?
– Instead of using a 2-ft. bolt they put in a bolt a few inches long, and clenched it to make it look like a through fastening. In view of the price ‘of steel at the time, the saving to them must have been enormous. Mr. Farquhars report continues -
Mr. Watson’s officers tested these bolts by their electrical appliance, and found that of the 106 only twenty were through bolts. They demonstrated this to me during my visit. The discovery of these sham bolts in the hold ceiling, and the omission of other bolts referred to elsewhere in my report, throws grave suspicion on the bolt fastenings throughout both the Braeside and the Burnside. . . .
Several bolts through the outside planking and the floorhead keelsons had no washers fitted, and were not clenched. Several bolt holes had been bored in same, and no bolts were fitted, and the holes were not plugged op. A. good many washers of the through bolts in the planking and frames were slack and required reclenching.
Leaving the matter of edge fastenings, which Mr. Farquhar said were the principal parts that served to hold a ship together, and dealing with other parts, this expert reported to the Public Works Committee as follows: -
I am decidedly of opinion that the Braeside, as she is built at present, is not in a seaworthy condition, and is not fit to proceed to sea.
This is the boat which was launched, and would have been sold to Messrs. Burns, Philp and Company if that firm had not discovered all about it, and in respect to which the contractors wish the Commonwealth Government to relieve them of their contract after having received about £112,000 in progress payments. In regard to clamp scarphs, Mr. Farquhar reported -
My examination shows that the shift of the scarphs is very poor indeed, and that the plans and specifications have not been adhered to with regard to same. … ° . . The number of horizontal throughbolts in the scarphs is not in accordance with plan No. 708a, prepared by Mr. Barber.
That is the plan which, honorable members will recall, had been sent on to Lloyd’s. This job was supposed to have been in accordance with the plans and specifications; yet, with regard to through-bolts, 80 per cent, of them were missing. I quote further -
In many cases the scarphs take only two frames (they should take three frames), thus reducing the number of horizontal throughfastenings. The four vertical clinch-bolts in each scarph shown in plan No. 708a in many cases have not been fitted.
And this expert adds the significant words, “ This is very serious.” He continues -
Twenty per cent, edge fastenings only have been fitted in the Braeside and 30 per cent, in the Burnside.
Then he calls the attention of the Committee to the following, and places emphasis upon his point, thus -
Please Note. - It has been said that it was impossible to fit the vertical edge fastening to the clamps and ceiling. Lloyd’s did not ask the builders to do the impossible. . . When I commenced my examination of these ships I was assured by Mr. Arthur Mayoh and his foreman that all the edgefastenings required by the plans and specifications had been fitted to the clamps and ceiling with the exception of two planks of the side ceiling. The two statements do not agree.
Mr. Farquhar had already pointed out that 20 per cent, only of the edge fastenings had been fitted in one ship, and 30 per cent, in the other - 80 per cent, and 70 per cent, respectively, were missing. He continued -
I desire to draw very special attention to the fact .that the bad disposition of the above butts and scarphs and lack of bolts and the failure to fit the edge fastenings has absolutely made these two vessels unseaworthy.
Those are the words of an expert. Some one, possibly, may have .said that something happened at the launching; but the expert answered that argument when he pointed out that the bad disposition of the butts and scarphs and the lack of bolts and the failure to fit the edge fastenings had made those two vessels absolutely un-seaworthy.
– Perhaps they were not meant for the water.
– I doubt if they were. Indeed, I had come to that conclusion long ago. It appears to me that they were built just as they had been intended to be built. They were built in order that their contractors might draw progressive payments from a Government who had failed entirely “ to provide for supervision, and that they might draw those payments as quickly as possible while giving no value in return.
– And, further, that they might draw compensation afterwards.
– Exactly! No stronger indictment than that of this shipping expert could have been made. These are the words of a man of whom the Government obviously think so well that they haye employed him at a salary, I believe, of £3,000 a year. In the face of such statements, coming from such a source, no Court of law in all the land could have said one good word for the contractors. If the Government had haled Messrs. Kidman and Mayoh into Court the Government must necessarily have gained a complete verdict.
– It is very doubtful whether these men should not be standing their trial.
– I have said that they should, and a member of the Ministry has actually said the same. If any individual member of this House, or of the Government, or if any business man outside, had let these contracts and the contractors had complained that they could not deliver the goods, would not that individual have sought to get the whole of his money back, together with interest ? And would he not have had an absolutely sound case in any Court of law? Would he not emphatically have won his claim? What is right for an individual should be right for the whole of the people. In this instance the taxpaying public are the aggrieved parties. Have they not every right to be repaid in full, together with interest? This money will come out of the pockets of the people. Are they not to be entitled to a fair deal? I emphasize that no Court of law would have allowed these contractors to escape.
When I last spoke upon this subject in the House, the Minister in charge, who had probably not carefully examined the whole issue, complained that I had not fully stated the reference which had been made by the Government to the Public Works Committee. His complaint was unfounded, but I now set out that reference in detail. The Public Works Committee were asked to decide upon -
The advisability of complying with the request of Messrs. Kidman and Mayoh to be relieved of the obligation to complete the contract entered into by them on the 4th August, 1919, to build two wooden vessels for the Commonwealth, and the conditions upon which such relief, if deemed advisable, should be granted, and that the Committee be authorized to proceed with its investigations whilst the House is sitting.
We were required to investigate and report, first, upon the question of the Government complying with the contractors’ request to be relieved of their obligation to finish their job; and, if we so decided, we were secondly desired ‘to go into the financial aspect. We deliberated, took evidence, and arrived at a twofold decision : first, that the contractors should not be relieved of their contract; and secondly, that the two vessels had not been built in accordance with the plans and specifications. Our finding, after it had been presented to the Government, was made known in the ordinary course to Messrs. Kidman and Mayoh, who, I stress, had said that they would abide by . the decision of the Committee. The Government then proceeded to interpret our finding; and, as an outcome, they issued a writ against the contractors for £114,000.
May I be permitted to place the case in the light of the contract being a private one, between ordinary commercial men in the community? If, after twelve or eighteen months, the contractors had told this person that they could not deliver the goods for- which they had contracted, that they could not build him his two ships according to plans and specifications, that they could not secure the necessary certificate from Lloyd’s, what would he have done ? He would undoubtedly have demanded the whole of his money back.
– With interest.
– And with interest. If an individual could: rightly make such, a claim, then it is equally right that such a claim should be made on behalf of the Government.
– Does the honorable: member say that the Government issued a writ?
– That is not so. In the first place a writ was issued against the Government by Messrs. Kidman and Mayoh.
– A writl was issued against the Government byi Messrs. Kidman and: Mayoh, and the Government counter-claimed for . 114,000. That shows the interpretation which they placed upon our finding.
– What time elapsed, between the presentation of the report of the Committee and the action taken by the Government ?
– Something like eighteen months. The honorable member for Melbourne Ports (Mr. Mathews), the honorable member for Dampier (Mr. Gregory), and I put several questions to Ministers before any action was taken by the Government.
– Why did not the Committee report that the contractors should be relieved of their contract on payment of the £114,000?
– We were asked to decide whether or not the contractors should be relieved of their contract, and, if so, upon what terms. Since we found, that they should not be relieved of their contract, we considered it unnecessary to deal with the question of terms. That the position taken up by us in that regard was correct is shown by the fact that the Government so interpreted our finding as to make a counterclaim for £114,000 against the contractors. It was not until some eighteen months after the issue of our report that Messrs: Kidman and Mayoh made a move. The Government then made a counterclaim, and then followed what is perhaps one ‘of the most discreditable features of the whole of this unsavoury business: Instead of having the issues determined by a Court of law, the Government appointed a secret Commissioner, or, as the Attorney-General prefers to say, an Arbitrator, to deal with the whole matter. When the Government decided to go over the heads of the Public Works Committee, by whose decision the contractors had agreed to abide, why did they order a secret inquiry? When the Public Works Committee went to Sydney, it found that the rooms usually occupied by it were iu the possession of the Arbitrator, Sir Mark Sheldon, who was then conducting his secret inquiry. Within less than a fortnight he had to be on his way to America, so that his inquiry was necessarily hurried. I would like to know what peculiarity attaches to these individuals, Messrs. Kidman and Mayoh, that they should have been accorded the privilege of a secret inquiry - the very thing for which they asked - in order that all the facts which I have attempted this afternoon to lay bare might be hidden from the public gaze? The inquiry was held in camera - the public was not allowed to know what transpired before the Arbitrator. At that inquiry, no doubt, evidence as to the dummy bolts and faulty work generally was given, but because the contractors were the privileged friends of the Government, and very likely had contributed to the funds of the Nationalist party, they were allowed to have a hole and corner investigation.
– And perhaps they had contributed to the Prime Minister’s testimonial fund.
– They were, perhaps, generous supporters of the movement to present the Prime Minister with a testimonial of £25,000. In recognition, apparently, of their services as good supporters of the Government, they were allowed this secret inquiry, and, later on, Sir Mark Sheldon forwarded hia; findings from Fiji to the Cabinet.
The Government, as I have said, counter-claimed £114,000. Sir Mark Sheldon awarded them £75,000. I think it would be only fair to add to the sum of £114,000. two years’ interest, which would bring the amount up to about £125,000. I believe that any Court of law would have found for the Government for that amount.
– What was the difference between the finding of the Arbitrator and the amount claimed by the Government?
– Allowing for two years’ interest, there was a difference of £50,000. In other words, these good Nationalist supporters received a present of £50,000. As the outcome of this secret inquiry, individuals who, according to the Postmaster-General, “ ought to be in gaol,”, received a present of £50,000. I have been unnecessarily delayed in bringing this matter before the House and the country. It is one of the most discreditable of which I know in connexion with the history of this or any other Government. The AttorneyGeneral will doubtless say that the Government acted wisely in handing over the whole question to the decision of an arbitrator. He will say, no doubt, as he said before, that they acted in accordance with the New South Wales Act relating to arbitration.
– There is no such Act.
– No; the contention’ that the action taken by the
Government was in accordance with the New South Wales law on the subject is mere camouflage. The contractors agreed to abide by the finding of the Public Works Committee.
– They broke that agreement, and no one could prevent them from instituting proceedings against the Government.
– If I were in the position of the Government I should consider, that a gross wrong had been done me if I. did not have returned to me by these contractors, not only the £114,000 paid to them, but two years’ interest, bringing the total to about £125,000. The ships built by Messrs. Kidman and Mayoh may not, as ships, be worth £5. They are worth only the timber used in their construction, so that, so far as they are concerned, the Government have nothing for the £114,000 which they paid Messrs. Kidman and Mayoh in respect of them. I repeat that in such circumstances I should expect to be reimbursed both principal and interest, and what I, as an individual, should claim, I shall always claim for the public as long as I remain a member of this House. The whole business from start to finish is fishy. It is most discreditable, and any supporter of the Government who is prepared to countenance it is unworthy of his place in the House.
– The honorable member for Hume (Mr. Parker Moloney) saw fit to submit this amendment without notifying the Government that he intended to do so. Of that, however, I make no complaint, since it is just what we might have expected of him. He concluded his speech with some utterances of a bitterly partisan character. That, also, one would naturally expect of him.’ ‘ I intend to ask the House to consider the actual facts. The honorable member devoted something like nine-tenths of his speech to a condemnation of the contract itself, and of the way in which it was carried out. At no time has the Government approved of the way in which it was carried out. As a matter of fact, it was because the Government realized that the contract was not being properly carried out and consequently took up a firm attitude as to the responsibility of the contractors, that the whole cause of dispute arose. Having been advised that the contract was not being carried out as it should he, the Government resisted the claim of Messrs. Kidman and Mayoh, and when they pressed it was agreed that it should be submitted for inquiry to the Public Works Committee.
The honorable member for Hume has referred to the faulty construction of these vessels, and has attempted, wholly without justification, to saddle the Government with the responsibility. He has been deliberately throwing mud at the Government in the hope that some of it will stick.
– And so it will.
– Even the most beautiful statue, if bespattered with mud, would be injured to some extent. This slinging of mud again is what we might naturally expect from the honorable member. It is abundantly clear that there is no justification for his attempt to blame the Government, for what has taken place. They maintained proper supervision over the work.
– They were not even bound to do that.
– As a matter of fact, they made full inquiries, and did all that could be expected of them in the discharge of their public duties.
A dispute having arisen, Messrs. Kidman and Mayoh wrote to the Government -
– The Government were resisting their claims under the contract, and a question arose as to how the dispute should be settled. The Prime Minister brought the matter before the House, announced the action which the Government proposed to take, and, by the decision of the House, the question was, referred for inquiry to the Public Works Committee. In a letter addressed to the Prime . Minister’s Department by Messrs. Kidman and Mayoh on 30th October, 1920, the following passages appeared : -
In view of all the circumstances it is desired that the Government would consider some means of relieving us of our contract and considering the question of allowing us some compensation for the work and time which has been expended in a genuine and conscientious effort to meet the country’s needs in a time of great distress. . . . Finally it is suggested, for consideration that if the Government can see its way clear to relieve us of our contract, we would urge that the matter he’ referred to the Parliamentary Public Works Committee with a view to their making a report on the whole position and considering the question of the amount of compensation which might be allowed us. If the Government can see its way clear to meet our request, we hereby undertake to abide by the decision of the Public Works Committee, whatever it may be.
The matter was accordingly referred, by the decision of the House, to the Public Works Committee, and .officers of the Department gave evidence before that Committee.
– What were the exact terms of the reference?
-On the motion of the Prime Minister, the House decided -
That the following matter be referred to the Parliamentary Standing Committee on Public Works for investigation and report: - “The advisability of complying with the request of Messrs. Kidman and Mayoh to be relieved of the obligation to complete the contract entered into by them on the 4th August, 1919, to build two wooden vessels for the Commonwealth, and the conditions upon which such relief, if deemed advisable, should be granted.”
Evidence of very discreditable work in connexion with the carrying out of the contract was given before the Committee, which found, as set out on page xii. of its report, that the request of the contractors be not complied with.
Where did that finding leave the Government? In addressing himself to the question on a previous occasion, the honorable member for Hume assumed that it settled the whole question. .That, however, was not the position. The finding left the Government with this contract still in hand. The Committee also made another finding -
That in the opinion of the Committee it is doubtful, even with the - expenditure of an unwarrantable sum of money, that the ships could be made seaworthy.
Thus the Government had the finding of the Committee that the contractors should not be relieved of their contract, and that it was doubtful whether, even with the expenditure of an unwarrantable sum of money, the ships could be made seaworthy. Obviously there was only one course open to the Government, and that was to immediately notify Kidman and Mayoh qf -the cancellation of their contract. That was done.
– The contractors should have been put ‘in gaol.
– I am not justifying the action of any men who in the carrying out of a contract might act in a deceitful or fraudulent manner. I am. dealing only with the legal position of this contract. The Government took the only immediate steps open to them, and that action was taken in the same month as that in which the Committee presented their report. The honorable member for Hume (Mr. Parker Moloney) overlooks the fact that the Committee’s finding still left undetermined all legal questions as to responsibility and liability.
– The Committee were not asked to determine those things.
– I am not finding fault with the Committee; they did all that they were asked to do. But the mover of the amendment has found fault with the Government for sending this question to another tribunal after a report had been made by the Public Works Committee. The answer to the honorable member’s complaint is that, although the Public Works Committee reported, in accordance with the terms of - the reference to it, the legal questions- were still undetermined. Immediately upon the presentation of the Committee’s report we cancelled the contract, and notified the contractors of a claim for a refund of the amount to which we thought the Commonwealth was entitled. On 29th November, 1921, the contractors issued a’ writ against the Commonwealth, in which they claimed £88,000 as damages.
– Did they itemize the claim ?
– No; it was a general writ in general terms for damages.
– Was that in addition to the amount which the contractors had already received in progress payments ?
– It was in addition to everything, and was a claim, .for breach of contract. The Commonwealth had to enter an’ appearance and take steps for the defence against the claim. We then agreed with Kidman and Mayoh that the matter should be referred to arbitration. Accordingly, an agreement was drawn up, which provided that “ the Arbitration Act 1902 of the State of New South Wales shall apply to proceedings in this arbitration.” Honorable members will see that there was no secret inquiry such as is charged in the amendment.
– It was a secret inquiry.
– Dozens and dozens of commercial contracts are made whereby- the parties agree that if any dispute shall arise between themregarding claims under such contracts they shall be settled under the arbitration law of the State.
– That is not so when gross -fraud is proved against one of the parties.
– It is so in all cases where parties have agreed -to settle their disputes by arbitration, whether or not fraud is charged..
– That would amount to compounding a felony.
– I am amazed that the honorable member should make such a foolish allegation. This whole contract was investigated by the Public Works Committee, - and not a member of the Committee has made a suggestion of thatkind. There waa no secret inquiry of the nature to which the honorable member for Hume referred. There was a reference to arbitration.
– Was the arbitration in camera ?
– It was.
– It- was absolutely secret. Some members of the Public Works Committee tried to gain admittance, but were refused:.
– This is the first I have heard of the proceedings being in camera. There was no reason why they should not have been open to everybody. It was just an ordinary arbitration, such as is undertaken in hundreds of cases between parties to a contract.
– The press was refused admission.
– The gentleman who was appointed, to arbitrate- was a leading citizen of New South Wales, audi a man of high integrity. This dispute, from its very nature, was eminently one for arbitration. It involved an inquiry into very many details.
– Did the Government ask the arbitrator to inspect the vessels?
– I presume so. I cannot say what action the arbitrator took. The whole of the evidence taken by the Public Works Committee was placed before him in order to obviate lengthy litigation, which would have been very costly indeed. All the information that was available to the Committee was available to the arbitrator to enable him to arrive at a judgment. There was no concealment of anything, and evidence given in public before the Public Works Committee has been published. In these proceedings we claimed on behalf of tha Commonwealth as much as we thought we were entitled to, viz., £114,000, the amount of the progress payments to the contractors under tie contract.
– Were any steps taken to- try to prove who was guilty of the fraud upon the Government in connexion with the construction?
– The whole of the evidence was placed before the arbitrator so that he might decide whether or not the Government should accept those ships. He was aware of the condition of the vessels, and the way in which the contract had been carried out. He had before him two claims, one by the contractors for £88,000, and the other by the Commonwealth for £114,000. In his award the arbitrator found as follows -
Question 1.- Whether the Commonwealth is entitled to refuse to’ accept delivery of the Braeside and Burnside?
Finding. - The Commonwealth is entitled to refuse to accept delivery of these vessels.
Question 2. What sums of money, if any, are due by either of the parties to the other in respect of the said original and further contracts, whether by way of damages for breach or non-performance of the said contracts, or return of moneys paid thereunder or otherwise ?
Finding. - The sum of £75,665 is due by the said Sydney Kidman, Joseph Mayoh, and Arthur Mayoh to the Commonwealth of Australia, and I direct that the said sum of £75,665 be paid to the Commonwealth of Australia.
– Is that plus what the Commonwealth had already paid?
– The Commonwealth is to receive that sum from Kidman and Mayoh, whose claim for £88,000 from1 the Commonwealth was disallowed.
– If they did , not fulfil their contract, the progress payments to them should be refunded.
– The arbitrator had to take into consideration the justice of many questions which were at issue. The Commonwealth obtained a verdict for £75,665, and, in addition, the contractors were ordered to pay the costs in connexion with the arbitration proceedings, amounting to £676 7s., and also the arbitrator’s costs, £215 5s. 6d. By having these claims dealt with by arbitration, and placing before the arbitrator the whole of the evidence taken by the Public Works Committee, the case was heard in a very short time, and the . Commonwealth obtained a verdict.
– Has the Commonwealth received the money yet?
– I refer the honorable member to the Treasurer. The House and the country will see the utter hollowness of this amendment. The contract has been discussed in the House on previous occasions. Since the session opened the Government have been trying to get on with the public business of the Com monwealth, but week after week we have been obstructed by amendments moved with the deliberate intention, apparently, of blocking the conduct of public business. It is about time that such conduct ceased. On the motion for the Address-in-Reply there was opportunity to discuss all grievances relating to administration, . but instead of availing themselves of that, honorable members opposite have held up public business by a series of electioneering amendments, and I have no hesitation in describing the present amendment as another of those political placards designed to serve, not in the House, but in the country.
.- It is all very well for the Minister (Mr. Groom), in concluding his speech, to say that the amendment is a political “ placard,” but what the people of the country are concerned about is the unnecessary expenditure from time to time in connexion with this and other matters. We on this side have raised various questions at times in order to focus public attention on them. Such opportunities as the present are the only ones we have, and I must say that I have never heard related to a Parliament such a state of affairs as in connexion with this contract. When I heard the case put before us by the honorable member for Hume (Mr. Parker Moloney), the thought struck me that the Government has been recreant to their duty in not taking criminal action against the men responsible for these acts of deception, which might have been the means of losing many lives.
– The Government do not seem to have ever heard of the crime of conspiracy.
– That is so. I can remember the time when Mr. Sam Smith, in the New South Wales Parliament, discussed the subject of un seaworthy ships and the Plimsoll mark; but there has never been a greater scandal in Australia than that associated with the building of these ships by Kidman and Mayoh. I repeat that it is strange to me that no action has been taken in the direction of prosecuting these^ people. Narrowed down, the case resolves itself into one point. The Government, after they had referred this matter to the Public Works Committee, and after they had received the report - after the culprits who were responsible for this faulty building had received £114,000 in progress payments’ - decided, simply because the contractors had the audacity to take action in the Courts for breach of contract, to give the matter further consideration. And in giving the matter further consideration, the Government looked for an easy way out; they did not face the facts, but altogether brushed aside the findings of the Committee. In order to prevent the cost of litigation, or, perhaps, to prevent the consequent exposure of men who are well known in this country, and one at least of whom has big financial interests here, the Government decided to submit the matter to. arbitration. Sir Mark Sheldon was selected as the arbitrator. I do not know whether he took evidence, but certainly, while on a sea voyage, he drafted his report, which simply means relieving these people from the payment of a large sum of money. Contrast this action of the Government with their action in regard to income tax prosecutions. Where a poor man is concerned, who has been unable to pay his income tax, a prosecution follows, and, no matter what representations may be made as to the disability of the defendant, he is lined, and must pay the fine or go to gaol. lt is a very different matter when wealthy people are concerned - people who have a contract with the Government, and who build unseaiworthy ships. That is a very deliberate statement for me to make, but it is one which I believe to be true. These people “slummed “ the work; they did not put in the bolts necessary to make those ships seaworthy. Wherever in this contract they could save money, they did so; and I remind honorable members that all this happened under the system of contract, about which we hear so much from time to time. Had this been a daylabour job, the case would have gone into Court; but, because it was. a contract job, it had to be hushed up - those concerned were wealthy men, with big interests in the country. They ought to have been put cm their trial, but the Government found a way by which they might escape; indeed, in place of being placed on their trial, they are actually going to be paid a large sum of money. Instead of returning the £114,000 they are going to be paid £39,320, and all this at a time when we hear so much of economy and the necessity for cutting down expenditure.
– Supposing the case had been fought out in Court, what would have been the difference?
– If the case had, ibeen fought out in Court, these people would have been exposed, as they ought to be. Is the honorable member* supporting the Government in allowing these people to escape from the effect of public opinion? What would the public kuow of this matter if it were not brought up in this House?
– The public know all about it.
– The public know about it because the facts have, been placed before us by the honorable member for Hume (Mr. Parker Moloney). The object of the Government is to escape as far as possible from criticism, and, at the same time, to make it as easy as possible for certain wealthy people to also escape. I say with the PostmasterGeneral (Mr. Poynton) that, if these men had their dues, they would be committed for trial before a jury, in order to answer for their work. That is the point that the Government have to answer; it is the only point in the indictment. The Minister (Mr. Groom) complained that the honorable member for Hume had devoted nine-tenths ofhis speech to details; but when all is boiled down we come to the fact that, after the question had been submitted to the Public Works Committee, and a report had been presented after a thorough investigation, the Government took no action on that report. We appoint Committees for the purpose of inquiring into matters and affording the Government advice.
– Did the report of the Public Works Committee find fault with the Government’s action?
– So far as I know, it did not. It is the subsequent action of the Government of which I complain. When they got that report, we expected them to take action in accordance with it.
– They did.
– Only when they were threatened with litigation by Kidman and Mayoh. What about the wool tops case, which is costing the country hundreds of thousands of pounds? There was no proposal to submit that case to the arbitration of Sir Mark Sheldon, but, for some reason best known to the Government, it was decided to submit the shipbuilding contract to that gentleman, who brought in a report which is favorable to Kidman and Mayoh.
– Kidman and Mayoh do not think so!
– Kidman and Mayoh may shake hands with themselves for getting out of this business in such an easy way. I venture to say that they never expected such a result, and I would like to know what put itinto their heads to take action. Of course, it is quite possible that they did not intend to go on with the action; there are many ways in which one can be extracted from an awkward position, and, probably, a threat of an appeal to the Courts is one. Instead of permitting these claimants to go on with their case., the Government decided to submitthe matter to arbitration, although they had agreed to abide by the decision of the Public Works Committee. As I say, Sir Mark Sheldon’s report is more favorable to Kidman and Mayoh than any result they could have hoped for in a Court of law. Had the case gone to Court, the country would have rung from end to end with the disclosures made.
– There would have been no more disclosures than there were when the evidence was being taken by the Committee.
– It is difficult to “understand the . honorable member. No matter what the question may be, he always endeavours to find some way to shield the Government.
– I am not shielding the Government, but giving facts.
– Only last week, on another matter, the honorable member voted a certain way by mistake, and on the next day voted in exactly the same way.
– Is the honorable member in order in stating that I voted a certain way when I did not do so?
– If the honorable member is misrepresented, the time for him to make a personal explanation is after the honorable member -who is addressing the House has concluded his speech. An explanation of the kind cannot be made in the middle of another honorable member’s speech.
– In all due deference to your ruling-
– The honorable member cannot discuss my ruling.
– I am not questioning your ruling, but-
– The honorable member is out of order.
– The honorable member for Wilmot (Mr. Atkinson) has called honorable members on this side of the House “ dingoes.”
– I did not hear such an expression, but if the honorable member for Wilmot used it I ask him to withdraw it.
– I did not say that honorable members opposite were “dingoes”; I said they were behaving in an unfair way in trying to howl me down, “ like a lot of dingoes.”
– If the honorable member for Wilmot did make such a statement by way of interjection, he was doubly out of order, and I ask him to apologize to the House for having done so.
– Yes, I do so.
– I had occasion only last week to draw the attention of honorable members to the inconvenience that arose, not only to the House, but to the member addressing the Chair, and also to the members of the Hansard staff, from interjections and .cross-interjections. I then appealed to honorable members to refrain from interjections, especially’ such as are certain to lead to counter inter,jection, and I again ask honorable members on (both sides of the House to desist from interjecting.
– It is not my intention to delay this matter, but I assert again that the Government are deserving of censure for their attitude upon this question subsequent to the submission of the report of the Public Works Committee in coming to terms with Messrs. Kidman and Mayoh, by which the firm was enabled to draw a large sum of money from the Commonwealth instead of refunding what it had already received in the shape of progress payments. The Attorney-General complains that honorable members on this side of the . House are constantly endeavouring to bespatter the Government with mud for political purposes. My reply is that it is the duty of an Opposition to expose such happenings as this, so that the public may be in a position to realize that the administration of the affairs of the country is not in the best interests of the people. Honorable members are sent to this House to protect those interests and safeguard the public purse, and to assist in effecting legitimate economies. They are not justified in countenancing any waste of public money. Since it has been shown clearly, time after time, that the best interests of the people have not been conserved by the present Government, Ministers cannot complain of the attitude taken up by the Opposition. Rather should they take steps to put matters in proper order and avoid rendering themselves open to attack. It is idle for the Attorney-General to
Bay that if one throws sufficient mud some of it may stick. We have heard that remark frequently in this Chamber; but, unfortunately, there are so many big questions affecting the national life of Australia in which the Government have done wrong, and in which they are continuing to do wrong, that the public outside are beginning to form an opinion in regard to their qualifications to’ remain in office. For this the Government have’ only themselves to blame. During the last seven or eight weeks it has been shown that in almost everything Ministers have’ touched there has been a screw loose, and that the affairs of the country have not been conducted as they should be; and since it is the duty of honorable members to give the fullest publicity to this, the Opposition will exercise its right, every time the opportunity presents itself, to expose the Government’s incapacity. The mistakes committed cannot be glozed over. They must be laid bare to the light of public criticism. The public must be placed in a position of being able to judge whether there is “mud-throwing” or not. The people will be the masters of the situation in the very near future. At the very latest we must appeal to them within the next few months. Statements are in circulation that a general election -is desirable immediately. If the Government are so secure in the belief that they are . legislating in the interests of the people they should be prepared to go to an election, as they will be bound to do if any of the motions now being launched against them find acceptance by a majority of honorable members. Surely they are not afraid of the political atmosphere outside 1 Surely they are not afraid to allow the people to have a voice in clearing up these matters which are constantly being brought forward? Honorable members of the Opposition are prepared at any moment to allow the people outside to decide these issues. The administration of affairs in the last couple of years has been so disastrous to the welfare of the people that we are hopeful that the amendment submitted to-day will be carried, because it will give the public outside the opportunity of expressing their approval, or otherwise, of the present Government. If the people choose to return the Government to power once more, thus expressing approval of the Government’s administration, it is their affair; but at the same time they will have been given the opportunity of expressing an opinion. I venture to predict that this Parliament will run to its full term if the Government can bring that about; but if honorable members would only vote in this House as they speak outside, instead of being flogged by allegiance to party to vote against their consciences, this House would’ be meeting the people within the next few weeks. During the last few days we have seen the spectacle of honorable members expressing an opinion outside, and four of them being taken ‘to task in grand council upstairs and whipped in, two of them to vote against their previous votes, and the oth«r two to vote against their own consciences, because their votes, if cast against the Ministry, would have meant its defeat at a time when the political atmosphere outside’ is unsatisfactory to the Government.
– This matter has been handled very ably by the. honorable member for Hume (Mr Parker Moloney), who is, like myself, a member of the Public Works. Committee. He has treated the Government very severely, but I always prefer to deal with matters dispassionately. I wish to say that the Government cannot leave the question at the point where it was left by the AttorneyGeneral. They must supply more information. They were too long in acting after the- Public Works Committee brought in their most emphatic report, which was sufficient to show even to a layman that Messrs. Kidman and Mayoh had not a nail on which to hang a hat, the case being so strong against them. Yet the Government allowed ten months to elapse before they took any further step in the matter, and then only when Messrs. Kidman and Mayoh issued a writ. They appointed Sir Mark Sheldon to arbitrate. My strongest objection to the arbitration proceedings conducted by that gentleman was the fact that they were held in secret. I walked into the inquiry and sat down, but was told that I could not remain. The members of the press, who had already been excluded,, laughed at my discomfiture. There was no one present at the inquiry but Sir Mark Sheldon, the witnesses, and the lawyers on each side. I want to know the items of the claim submitted by Messr3. Kidman and Mayoh. The firm could not have gone into a Court of law with simply a bald claim for £80,000. They must have itemized their claim. Then, again, the Government must have itemized their counter-claim for £114,000. The Attorney-General has told us that Sir Mark Sheldon’s award was that the Government should be paid £75,000 ; but I want to know what items in the Government’s claim were allowed. The Government had already paid Messrs. Kidman and Mayoh, not only £114,000 in progress payments, but also a further sum of £52,000, although there was no claim made by them for the repayment of the latter sum. Did the Government itemize their counter-claim ?
– On what did Sir Mark Sheldon base his award of £75,000 ?
– That is just what I wish to know,Sir Mark Sheldon acted in the capacity of a Judge, and, surely, he ought to have said why he only allowed the Government’ £75,000. Unfortunately, the member of the Government who was responsible for shipbuilding at the time is no longer in charge of it; but I am sure that the present Minister for Works and Railways (Mr. Richard Foster) would not have left the matter where it is if he had been in charge of the business. Surely honorable members on the Government ‘ side of the House are prepared to- ask the Government why only £75,000 out of £114,000 was awarded to the Government. Detailed evidence must have been submitted, otherwise the arbitrator could not have done his. work properly. The Public Works Committee recognised that if they had had to deal with the financial aspect of the question they would have been obliged to go into the matter in every detail, and Sir Mark Sheldon, -in conducting his inquiry, was in exactly the same position as the Committee. He should have explained his reasons for awarding £75,000, just- as the Public Works Committee would . have been obliged to do if it had given a similar finding.
– Sir Mark Sheldon was really in the position of a Supreme Court Judge.
– But a Judge would have said why he gave a certain verdict.
– Perhaps Sir Mark Sheldon has done so.
– When the AttorneyGeneral was reading Sir Mark Sheldon’s finding, I asked him to give the information I required, but he would not do so. I leave the matter there. As a member of the Public Works Committee I went through the whole of the inquiry into the shipbuilding contracts, and I am surprised at the way in which the whole matter has terminated. However, I claim that it would only be doing justice to the people of Australia for the Government to supply further information as to why they should get not more than £75,000.’
Motion (by Mr. Brennan) put -
That the question be now put. <
The House divided.
Majority . . . . 21
Question so resolved in the negative.
.- The honorable member for Hume (Mr. Parker Moloney) reckoned, no doubt, that he had secured an opportunity to make a sensationl display. He has censured the Government for having taken the whole subject-matter out of the purview of the Courts and handed it over to Sir Mark Sheldon for arbitration. If the contractors had been taken into the Courts, the best the Commonwealth could have hoped for would have been to secure a verdict for £114,000. I do not know whether the Government acted on the advice of counsel, or what may have influenced them; but they decided to call in Sir Mark Sheldon as arbitrator. He has arbitrated, and has given the Commonwealth what amounts to a verdict for £75,000. Knowing, as I do, how uncertain is the law, I cannot see that the Government have come out at all badly. The (honorable member for Hume appears to have lost his sense of proportion. The Government were not bound to exercise supervision over this business. Here was a contract, entered into by Messrs. Kidman and Mayoh, to turn out certain boats according to specified conditions. When the vessels were inspected, it was found that they had not been built according to plans and specifications. There were all sorts of important and serious omissions; and the Commonwealth Government, acting upon the recommendation of the Public Works Committee, cancelled the contract. Despite that, the honorable member for Hume has come here to-day with a time-wasting proposition, and has sought merely to “ spread “ himself. I repeat that the Government are not to blame. The Leader of the Opposition (Mr. Charlton) has lately done himself an injustice on several occasions. Incidentally, he misrepresented my position
– I rise to order.
– Order ! The time for the consideration of the motion has expired.
– On a point of order, I understand, sir, that you have announced, on the basis of the Standing Orders, that the time for the consideration of the motion has expired. I take it that you so rule under standing order 119, which states -
If all motions shall not have been disposed of two hours after tho time fixed for the meeting of the House, the debate thereon shall be interrupted, and unless the House otherwise order, the Orders of the Day shall be taken in rotation; but if there .should be no Order of the Day, the discussion on motions may be continued. The consideration of motions may be resumed after the Orders of the Day are disposed -of.
I submit that that plainly refers to matters which do not appear on the business-paper as Orders of the Day. If your ruling is correct, namely, that after two hours’ debate an Order of the Day expires, then I hold that the motion for Supply must be discharged. It is Order of the Day No. 1, which is set down as “ Supply - further consideration in Committee.” If that Order of the -Day is discharged because an amendment attached to it can be no further debated, owing to the effluxion of time - and the amendment of the honorable member for Hume (Mr. Parker Moloney) is a direct amendment to a direct- Government motion - then, I take it, the matter of Supply cannot now be proceeded with. I do not want that to be brought about; I desire that Supply shall be granted to-day. If your ruling is upheld, I submit that the House cannot proceed to go into Committee upon Supply.
– There appears to be some misapprehension regarding the position. The matter of going into Committee of Supply is not prejudiced in any way in consequence of failure of the- House to give any direction concerning the GovernorGeneral’s message. I have announced its receipt, .and read it to the House, which is at liberty, if it so chooses, to go into Committee of Supply without any motion being submitted. I point out that the Orders of the Day have not yet been called upon. The receipt of a message from His Excellency the Governor-General is usually followed by a formal motion which, however, is not generally moved by a Minister, but is put direct from the Chair. In the present instance an amendment has been moved, not to an Order of the Day, but to a formal motion stated from the Chair for reference to the Committee for its consideration. The Committee is at liberty to consider it without any motion, but as a matter of courtesy a motion is made, and, unless something is done with it before fie expiration of two hours, or unless otherwise ordered, the discussion on both must be interrupted, and I am hound to call on the Orders of the Day. Even if the motion were a Government motion it would make no difference. The standing order does not differentiate between Government and private motions. I have in my marginal notes to the Standing Orders several references to this point, which has been raised on previous occasions. There are two in particular to which I draw the attention of honorable members. One is that, on 7th November, 1913, a motion of no confidence was interrupted at the expiration of two hours, and another refers to a motion which had been moved by a Minister (the Honorable King O’Malley), having to’ do with the re-arrangement of the electoral divisions of Queensland, which was similarly interrupted by the expiration of the two-hour limit. I have no option now but to call on the Orders of the Day, not only in accordance with the Standing Orders, but in keeping with the usual practice of the House.
Order of the Day No. 1 - “ Supply– further consideration in Committee “ - called on.
In Committee of Supply:
[5.4J. - I move -
That there he granted to His Majesty ffor or towards defraying the services of the year 1922-23 a sum not exceeding £1,783,025.
When I introduced the first Supply Bill this session, I informed the Committee that I hoped the Budget statement would be presented before the Government again sought Supply. However, owing to the fact that Supply must be obtained before Friday next, on which date the fortnightly pay of the Public Service is to be disbursed, it will be impossible for me to realize that hope. The Government have decided, therefore, to ask for Supply for one month. The Budget statement will be made to-morrow, and when they have heard it honorable members will be enabled to judge the position more closely than is possible at present. In the first Supply Bill for the present financial year we asked for £2,481,850. The amount for which we ask in this Supply Bill is £1,763,025. Honorable members will see that the Bill is divided into three parts. The first deals with the ordinary service®, amounting to £1,363,025; the second, with refunds of revenue, £100,000; and the third with “ Advance to. the Treasurer,” £300,000. The Supply for which we ask makes no provision for expenditure of an extraordinary or . novel character, and is on the basis of one-twelfth of last year’s Estimates. The total of the ordinary votes for that year was” £24,715,282. Included in that amount, however, was a sum payable, under the funding arrangement, in respect of the debt that we owed to the Government of .the United Kingdom. That payment is. now provided for by a special appropriation, and so has to be excluded from the figures with respect to the present year. Deducting it, the total sum voted in respect of last year was £19,166,467, and one-twelfth of that amount is £1,597;206. In this instance we are asking for only £1,363,025 for ordinary services, or about £234,181 less than onetwelfth of the amount voted on last year’s Estimates. These figures- will’ show honorable members that the amount for which we are asking is the minimum necessary for the ordinary services of the Commonwealth for one ‘month. As to the other two ‘ item’s, I would point out that in respect df ‘ refunds of revenue ‘-we “axe ‘asking for £100,000, whereas under the last Supply . Bill the amount voted was. £170,000. This item is to provide for repayments of revenue which have. beam received in excess of the payments that were due. The reason it is smaller on this occasion is that during the month of July heavy .refunds of income tax have generally to be made. We do not anticipate that the same amount will be required in the month covered by this Bill. The Treasurer’s Advance for which we are asking is £300,000. In the first Supply Bill for 1922-23, the Treasurer’s Advance was £750,000. The position in regard to that item is that for the month of July we absorbed only £550,000 of the £750,000 that we expected to be called upon to pay. That means that we have £200,000 in hand. We are now asking for an additional £300,000, making the total for the month, £500,000.
With regard to the Treasurer’s Advance, I would point out to honorable members that, apart from certain advances which are being made to the Department of the Postmaster-General , as part of the scheme which will be outlined to-morrow to honorable members, there are no payments ‘being made other than in relation to matters which have already been approved by Parliament. There is nothing else with which I think . it is necessary to deal. The Supply for which we are asking is foc one month, and it is on a lower basis than the Estimates of last year.
.- It is a well-established rule of parliamentary procedure that Supply shall not be granted until grievances are redressed. There are many grievances which need to be redressed. . Amongst these is the fact that it is impossible in this Chamber to secure the proper elucidation of public questions if the Government makes up its mind to -use a brutal majority to prevent it. I.take this opportunity of bringing before the Committee certain information, which, in the shape of sworn statutory declaration, came intomy possession on Thursday afternoon last regarding certain of the sugar, purchases of the Commonwealth, but which, owing to the application of the “ gag,” I was unable to set .before honorable members last Friday. The declaration has been substantiated to a very large extent by statements that were made by the .Minister for Trade and Customs (Mr. Rodgers) and the Prime Minister (Mr. Hughes) when speaking on Friday last. I have waited largely in vain for information to be supplied by Ministers to the Houseregarding purchases of ‘ sugar made- abroad. I think that the declaration I propose to read, and the statements which I am about to make, will supply at least some reasons for the action of the’ Government in attempting to smother up its dealings in connexion with sugar, and to apply the “ gag “ whenever an opportunity arises for an honorable member to put certain facts before the House and the people.
I should like to refer to the -tactics - tactics which would disgrace blackfellows - that have been used in connexion with this question of sugar.
– I rise to order! Is the honorable member in order, first of all, in reflecting on a vote of the House; and, secondly, in referring to the majority in this House as “ blackfellows “ ?
– I did not exactly hear what the honorable member said, but I certainly did not understand him to reflect on any vote of the House. The honorable member was not in order in referring to a “ brutal majority,” but I allowed the remark to pass. I was waiting to hear what were the “ tactics “ to which he was referring when this question of order was raised, so that I might determine whether or not the honorable member was in order. So far he is not out of order.
– I am quite content to let the people of Australia form their own opinion regarding the tactics of which I complain. Last week one of our party, who had to attend the funeral of his mother, was refused a pair. We had another honorable member in bed suffering with pleurisy. He also was refused a pair, and, at the risk of his life, he had to come to this building, where he remained for hours cowering over a fire in the Country party’s room.
– He was offered a pair, and would not take it.
– I shall deal later on with the Minister for Trade and Customs. Then we have another member of. our party in hospital, gallantly fighting for his life, and advantage has been taken of his absence from the House to use his name in a way to which he objects, and to put him in a false position, not only before this House, but in his electorate.
– That is incorrect.
– It is absolutely correct. The honorable member to whom I have referred has stated through the press what his position is, and what is the attitude he takes.
– He has stated that he gave instructions that he should be paired, if necessary, against the Labour party.
– I have stated the exact position. I shall not apply any terms to the action of which I complain. I shall allow the public to come to a decision on, the facts without any comments on my part. Later on, however, I shall give illustrations of other tactics that are being resorted to in order to prevent the free and full discussion of the sugar question, and to make it impossible for the public of Australia to be put in possession of the whole of the facts relating to it.
The Minister for Trade and Customs, in dealing with the question of sugar purchases, said deliberately in this House that the whole of the sugar purchases had been conducted through wellrecognised and well-established channels. That statement, as made by him, appears in Hansard. The information I have today, however, is that at a critical time in the history of the sugar purchases - when the sugar market was in a state of the greatest turmoil, when it was changing so rapidly from day to day, that within a week there might have been a difference of from £10 to £15 per ton in the quotations - the Government took a mostextraordinary course. In such circumstances what did they do? Did they continue to do business through the oldestablished and experienced firms? Did they stick to the men with technical knowledge, who had been trading and dealing in sugar all their lives? Did they stick to those who had advised the Commonwealth when the sugar market was stable ? They did not. When that condition of affairs arose, they engaged in Melbourne, not a sugar expert nor a sugar importer, but an importer of motor cars, who, up to that time, had not been in the sugar ‘business. Their choice fell upon this man, who had had no business dealings in sugar except that, as a grocer some time previously, he had sold some in one of the big firms in this city. . They put into his hands, to a large extent, the business of supplying the Commonwealth with sugar at a time when judgment, technical knowledge, and wide financial experience were essentially necessary for the safeguarding ofthe public funds of the Commonwealth.
– When was that?
– In 1920.I. propose to show what happened in that year. From information which I have obtained from the Department of Trade and Customs, as well as from information given by Ministers on Friday, I have been able to confirm, to a large extent, the statements made in the sworn declarationto which I referred at the outset of my speech. I find that in certain cases the business of- purchasing sugar did not go through the ordinary recognised channels. Three orders- -one for 1,000 tons of white, at £72 12s. 6d. per ton f . o.b. ; one for 5,000 tons, at 42 florins 60 cents per picul, f.o.b., on 11th November, 1920; and one for 10,000 tons of white, at 54s. per cwt., are stated to have been purchased from James Nash, through Colonel Oldershaw. There should he the closest investigation of this departure from the ordinary safeguards which should have been exercised by the Government in the expenditure of huge sums of money. On 3rd instant I put on the notice-paper the following questions to the Minister for Trade and Customs: -
Will the Minister lay upon the table of the House -
The information for which I asked in this series of questions should surely have been obtainable in a few minutes if the records of the sugar control were properly kept. In each case I asked for records of individual transactions; but I got nothing. I received no information whatever. The details of these individual transactions, which must exist in the books of the Commonwealth, are not before us at all.
– They are set out in detail.
– They have never been given to me, and no answer has been given to my questions in this House.
– They are all set out in detail.
– They are not. The Minister is making a statement which is not correct. Where are these individual transactions set out in detail ? What are the name3 of the brokers and agents who acted on behalf of the Commonwealth in each case? What are the amounts of commission that have been paid to them? If no brokers were employed, through whom was the sugar purchased?
– The honorable member, can get all that information from the papers that have been published and distributed.
– Where are those papers? I have not seen them.
– I have my copy, and 1 picked it up from the table.
– The Minister has not a copy of a paper which contains the detailed information for which I am asking. How did the Government carry out their purchases of sugar? Instead of purchasing through the Colonial Sugar Refining Company, who were the Commonwealth agents in all. other purchases, I find that during the month of May, 1920, Mr. W. E. Davies, who was engaged in the motor trade, and had not hitherto, any experience of importing sugar, was able to state that he was in a position to influence the business. He called upon Mr. Ben. J. Lee, of Melbourne, who wastrading with Jaya, and informed him that the Government would, in the immediate future, bc purchasing large quantities of sugar, and that he (Davies) was in a position to influence the business. He suggested that Lee should enter into an arrangement to make Davies his agent. Before entering into any arrangement Lee asked Davies that the statement that the business was in Davies’ hands should be confirmed directly to Lee by the Depart-, ment. Davies accordingly took Lee to Mr. Deane, where Lee was informed that Davies would be given an opportunity of. quoting for the business, and that if the price was right there was no reason why they should not do business. An arrangement was then entered into between Lee and Davies that Lee should pay to Davies, half the profits resulting from the sale of sugar by Lee to the Commonwealth in return for Davies securing the business at this end and obtaining orders from the Government. Lee went to Java and remained there until the end of November, 1920, during the whole of which time he was in a position to supply at lower prices than on the three orders of 1,000 tons, 5,000 tons, and 10,000 tons respectively, which I have previously mentioned. Instead of carrying out his arrangement with Leo, however, Davies purchased sugar “from James Nash, of Sourabaya, and the three above-mentioned sales went through at ’72s. 7½d. per cwt., 42 florins 60 cents per pieul, and 54s. per cwt. respectively. Davies went to Java, and during the time he was there he is stated to have collected as part of his profits on the transaction at least £30,000. Upon his Teturn to Melbourne at the end of December, 1920, disputes arose between Lee and Davies on account of the latter having effected purchases through Nash.
– “What is the statement the honorable member is reading?
– It is a condensation of a statutory declaration. A settlement was made between Lee and Davies after an interview they both had with Mr. Deane, of the Prime” Minister’s Department. That interview took place early in 1921, and Lee states that as a result of the conversation at that interview Mr. Deane became aware that Lee had offered to supply sugar through Davies at a lower price than that paid by the Commonwealth to Nash on the same date and times that Nash supplied it. One of the terms of the settlement was that Lee was to receive £1,000 compensation out of the profits made by Davies, and a further term was that Lee should secure further orders for the supply of sugar through Davies from the Commonwealth Government. Davies was actually given orders up to as late a date as 8th February, 1921, although they were subsequently cancelled. On 29th January, 1921, when writing to Nash, Davies expressed regret that Mr. Deane had been drafted into another Department, and that the Sugar Board was now in control of a’ll buying, and that all he could do was to place quotations before the chairman of that Board. Later, in November, 1921, Lee, having found out that Davies -had supplied the Commonwealth with larger quantities of sugar than were represented by Davies at the time of the first settlement when he paid . Lee £1,000, made a further claim for a share of Davies’ profits. Davies then entered into an agreement with him, the original of which I have in my possession. ‘ Under this agreement Davies paid Lee a further £1,500 as compensation, making a total of £2,500, and Lee covenanted forthwith to hand over to the said Wm. Edward
Davies all documents, agreements, papers, and writings, including copy documents, agreements, papers, and writings relating to or in any wise connected with dealings in connexion with any business transactions or otherwise in which he, the said Benjamin Joseph Lee, and William Edward Davies, are, or were, in any wise interested, and all his right, title, estate, and interest in and to the same.
– Does the honorable member expect me to follow all- this statement when he is gabbling it at such a rapid rate? If it contains a charge, read it slowly.
– At the’ sametime Lee was called upon to make, and did make, a statutory declaration, in which he declared -
That was a very stringent agreement, and insured that practically every document that was likely to be used in future would be handed over.
– Handed over to whom ?
– To Davies, the man through whom the Commonwealth had arranged to buy sugar at a time when the sugar market was in a more convulsed state than it had been in at any time during the last fifty years. The fact that in the deal with Davies the Government departed from the ordinary channels, that Davies made a huge profit in the transaction, and that in effecting a settlement with those whom he had, apparently, double-crossed, he -.secured a covenant and a statutory declaration such, as I have just read, savours of some very ugly features, and calls for instant investigation. The covenant referred to appears upon the’ face of it to be an undoubted attempt to smother up some improper action. For what was the £2,500 paid ? Why was Davies placed in a position to influence business through the Prime Minister’s Department? Why were the documents and correspondence to remain private ? Why did the Government pay Nash £72 12s. 6d. f.o.b. for sugar on 13th September, 1920, when on the same date they only paid Maclaine, Watson & Co. £71 f.o.b.? What I and the public desire explained is why the Government went outside the ordinary wellrecognised channels of business to conduct sugar operations during 1920, when the condition of the sugar market was such that there were almost daily fluctuations, making it possible for fraud and corruption to take place in a way that could not possibly happen when the sugar market was stable for weeks and months at a time. I am not making a charge of fraud against anybody, but I do say that these matters require explanation. They call for an instant reply from the Government, and for the placing of all the cards on the table. That is especially so in connexion with the brokerage on the sugar purchases, so that we may be able to judge from the complete facts what the true position is. We find that Lee, who did not buy one pound of sugar for the Commonwealth, was given £2,500 by Davies. What for? Was it to keep him quiet ?
– Who paid him ?
– Davies paid Lee.
– Well, I have nothing to do with that.
– We desire information, and when we try to get it we are met with a policy of delay and smother. Did I hear the Prime Minister remark, that thieves have fallen out? ‘
– No; but the honorable member may draw that inference from what I did say.
– Why did the Commonwealth utilize the services of such a man for such tremendous dealings, aggregating nearly £1,000,000 ? I do not know why the Minister for Trade and Customs has not produced the informa tion for which he was asked. We want the whole of these transactions probed absolutely. It is not sufficient that the matter should be hurriedly referred to the Public Accounts Committee for an inquiry, which may continue for months and months without providing any opportunity of having witnesses thoroughly examined by counsel, so that the whole truth may be elicited. The Public Accounts Committee, in its final report on the War Service Homes, said that the transactions with Green and Company are incomprehensible; but the Committee was unable to follow the matter to a final conclusion in order to see what the actual trouble was. If Ministers are so keen on clearing everything up, why is it that we find one of them waving a piece of paper, and saying that all the information I desire is available? Why is not full information, supplied, and an opportunity given to the House to discuss the matter?
– Has the honorable member not seen this paper which has been . circulated ?
– That paper does not supply what I ask for, andi I may say that it is entirely different from the original produced - there is not as much information in that paper as there was in the proof. I observe1 also that there is a definite date set against every transaction ‘ except the four ‘ which went through the Prime Minister’s Department. If we look on page 6 of the document, we see that the four, transactions through John Nash and Francis Peek and Company show no dates to indicate when the transactions took place.
– The invoice date is there.
– That may be, but there is no indication of the exact contract date of these transactions, though, so far as we - can see, it was the 13 th September, because that is the only date available. We have seen deliberate attempts to stifle criticism and discussion in this House, and, further, all sorts of outside influences are brought to bear to prevent the ventilation of the subject. Last night I received the following telegram from -Queensland from a Mr. Edkins -
Federal Parliament House, Melbourne.
In view of the following points, namely, one, the promise given by the’ National Government to reduce the price of sugar to pub- lie on November first next; two, recent juncture of forces in New South Wales and Tasmania, together with public opinion expressed in South Australia and Victoria do not warrant continuous opposition present National Government; three, on behalf of Queensland country interests we would prefer, your party offer support necessary legislation to assist development primary production; four, any delay of Meat Bounties or Meat Board Bills will be disastrous to our country interests which require immediate relief; five, our sorry experience in Queensland makes it imperative check any possibility Labour regain power; therefore strongly recommend withdrawal censure motion.
We find that this gentleman travelled to Sydney on Friday night by the same train that carried the Prime Minister and other Ministers. It is interesting to note that, as the Prime Minister returned from his sugar tour, he met this same gentleman, and also Mr. Garbutt, of northern Queensland, and they very cleverly arranged that the Country party in Queensland should not put forward any candidates for seats at present held by Nationalists in this Chamber. It was suggested that this was the “ end of the section “ so far as the Federal Country party in this House is concerned.
I have a very definite reason for the statement that I am about to make - a definite reason associated with the suggestion of bribery and corruption made two days ago in the Queensland Parliament. I wish to clear, absolutely from all implication the Leader and members of the State Country party in Queensland, if any such attempt were made as that suggested. I do not say that an attempt of the kind was made, but I wish to state the position clearly, as relevant to the position of the Federal Country party here. The organization in Queensland, by a five to four majority at the inspiration of Messrs. Garbutt and Edkins, decided to fall in with the Prime Minister’s wishes in this respect. Fortunately, however, the State Parliamentary Country party reversed the decision of the executive, and unanimously carried a resolution >to support and run Federal Country party candidates in every country electorate in Queensland.
– They left the matter to the organization.
– That is so, and the local organization is going to run a candidate for Wide’ Bay.
– Nothing would suit me better than to have the honorable member as a candidate!
– However that may be, I sent the following reply to the telegram I have read-
Edkins, Graziers’ Association, Brisbane.
Strongly resent your unwarranted attempt at intimidation Parliamentary action, consider deferred reduction price sugar seriously prejudicing sugar-growers’ case all over Australia. New South Wales graziers, farmers, and settlers decided overwhelming majority remain distinct political entity. Tasmanian coalition only after defection of Nationalist supporters and deposition of autocratic Premier. No Government dare repudiate beef agreements. Our party shown willingness support all legislation favouring primary production, but refuses support extravagance, waste, and incompetence in administration. Heading your wire and my reply in Parliament.
Earle Page. [Extension of time granted.] There should be no attempt to coerce the votes of ‘ members of Parliament in this way from outside. Speaking for myself, I may say I came into this House without taking1d. for election expenses from any fund or organization, and,’ without fear or favour, I represent here the best interests of my constituents. I refuse to be intimidated by any organization, no matter how wealthy, or where it may be. I am prepared to take that attitude, even if I have to stand alone on the floor of this House to fight for justice and the principles I regard as right. The matter to which I have just now referred should, I think, receive the earnest consideration of the Government.
I should now like to deal with another aspect of the sugar question, namely, the retail price. During the last two or three weeks we have had presented to us a continuous array of figures; we have had various balance-sheets of the past, and we have even got as far as a balance-sheet of the future. We cannot get hold of the balance-sheet for each separate year; in fact, I noticed yesterday that an official of the Department admitted that there were practically no balance-sheets or accounts kept in the Department.
– No books.
– No books of any sort.
– Who said that?
– We have asked for figures which ought to be available, and which have been available in the case of the Colonial Sugar Refining Company every half-year - figures on which the company has paid dividends. The Minister the other day tried to “ side-track “ me by saying that the Auditor-General’s report contained the figures.
– I did not say that.
– The honorable member is not the only man in the world. The figures I refer to deal only with the sugar handled by the Millaquin and Colonial Sugar Refining Companies, and do not give a full statement of the case. They do not deal, for instance, with the duty that would have been collected, or with commissions, or anything of that nature. The balance-sheet of the Colonial Sugar Refining Company is a full balancesheet of that company, but there is no place where we can find the Commonwealth balance-sheets in an ordered state, so that one who runs may read. The only person who has attempted, from the Ministerial side, to bring before the House figures which are understandable, and give a bird’s-eye perspective of the position, is the honorable member for Parramatta (Mr. Pratten), who presented an exhaustive and conclusive statement of the Whole case. That honorable member calculated that, in the absence of more detailed particulars, the price of sugar could be reduced at once, and that we need not wait until the 1st November.
– With certain qualifications.
– Quite so, and the honorable member presented a table which supported his statement. We have, as I say, had various balance-sheets and statements presented to us. On the first occasion the balance-sheet showed £250,000 of leeway; the next occasion - which is a balance-sheet of, the future - shows that there will be something like £700,000 to make up. But none of these balance-sheets are, in any sense, a true statement of the position as it affects the taxpayer and consumer.
Mr. Rodgers interjecting,
– I must appeal to the Minister for Trade and Customs (Mr. Rodgers) to obey the Chair. I have repeatedly called for order, and if Ministers will not support me, it will be impossible to retain the necessary control of the Committee.
– We have seen the amount of £415,000 flying from one side of the balance-sheet to the other in various accounts. The’ Minister for Trade and Customs seems to disparage the conduct of the British control as compared with the Australian, but, in England, the effect on revenue of the duty and other circumstances are all taken into account throughout the transactions. There the control was charged duty from about £1 per ton at the beginning up to £25 13s. 4d. right at the end. The Minister for Trade and Customs (Mr. Rodgers) the other night, in answer to an interjection, said that there was no question of any duty having been taken into account in connexion with the Australian sugar figures from 1919 onwards. That being the case, and seeing that we have imported about 250,000 tons of sugar* since that period, the sugar account must owe the general revenue account £1,500,000 in the shape of duty at the rate of £6 per ton, and the balance-sheet as presented does not, therefore, properly represent the position. The honorable member for Parramatta (Mr. Pratten) has already shown that we have practically cleared the sheet, apart from the question of duty; that is to say, the’ balance on one side is just about what it is on the other. It may be all right from the Treasurer’s standpoint to say that the £415,000 credited to the Treasury four or five years ago must now be regarded as something to be made up, but looking at the matter from the point of view of the relation of the taxpayer to the consumer, that £415,000 ought to be credited to the sugar account in ascertaining the balance as between the taxpayer and the consumer.
– What about the producer? Should not he get it?
– Yesterday I took my courage in my hands and put the case for the producer before the Housewives’ Association.
– If the producer has it, the consumer cannot have it.
– The consumer should have it, and not the Government, which has had it in the past. For *the last three years the Government have been taking £9 per ton from the consumers in order to make up for the losses on purchases overseas. The recent low price of sugar in Australia, about which the Prime Minister has boasted so often, was due, not to his wonderful purchases abroad, but to the fact that the sugar producers of Australia had been getting, up to 1919, roughly, the world’s parity, and since then, and until the present year, less than the world’s parity.
Sugar ischeapto-day because during the last two years the Government have been able to mix local sugai- with imported sugar, and bring the price down to lower the cost of their purchases outside.
– Everything the honorable member is saying is topsy-turvy. The position is just the opposite.
– That is not so. The right honorable gentleman goes; up and down Australia as the protagonist of a White Australia, but what does he do for the white sugar -growers of Queensland? In 1918 he insisted that they should work for a price per ton which was practically the same as the world’s parity, but he did not give them the benefit of the £6 per ton duty in the price of the commodity, although it was the declared policy of this Parliament and of the nation that the industry should get that advantage.
– That was done in 1915.
– No; it was in 1918. On the 19th April of that year a deputation of cane-growers came down to ask the Prime Minister* to increase the price of raw sugar from £21 to £24 per ton, and because the Prime Minister had very little time for thedeputation, and sent them away empty, there were 25,000 acres planted in that year less than in the previous year. Again, it was because the Government was not willing, for political reasons, as I have heard one of their protagonists say in this Federal Parliament, to give the sugar-growers as fair a deal as they were entitled to, taking into consideration the fact that we had always protected them <to the extent of £6 a ton against black grown sugar, that we had to pay such a high price for foreign sugar in 1919 and 1920, and were led into these excessive purchases overseas.
The question now is: What is the proper policy to follow in connexion with the present price of sugar? Since the Minister for Trade and Customs made his statement in this House that the price of sugar was to be reduced to 5d. per lb. on the 1st November next those people engaged in the fruit preserving and jammaking industries have been rinding it an extremely difficult matter to get a full complement of orders. Quite a number of manufacturers have told me that they will soon find it hard to finance their operations, because every grocer is endea vouring to carry as little stock as possible for fear that on the 1st November he will be caught with a bigger stock of preserved fruit and jams than he can sell at a price whichwill give him a fair profit. The proper policy for the Government to have followed was to have done exactly what was done when the price of sugar was raised - that is to say, to leave any alteration in price at the nearest possible time, either forthwith or next day, to the decision of Parliament.
– Remember that there is a standing agreement for three years.’
– The agreement to which the honorable member refers does not affect the question of whether the retail price of sugar should be 5d. or 6d. per lb. The Prime Minister occupied two hours last week in an endeavour to explain to honorable members that the Government could afford to sell at 5d. per lb. without . interfering with the sugar agreement. I am prepared to accept, at their face value, the figures of the right honorable gentleman demonstrating that the Government can sell at 5d. per lb. It is some concession, because I believe it would be possible to sell at less than 5d. per lb. without loss to the Government. The honorable member for Wide Bay contends that retail sugar cannot be reduced in price because of the agreement with the growers and millers.
Mr.Corser.- Not below £30 6s.8d.
– That is the point. We have never heard from the Government any proper discrimination between the agreement with the millers and growers to pay them £30 6s. 8d. per ton, which is the only agreement of which the House has cognisance, and a second agreement which the Government has made with other people, and under which it is selling sugar at £56 per ton. ‘ Thatsecond agreement with which we have had very little to do was arranged by the Government quite independently of Parliament, and I would like to know what its terms are, and whether it is possible under it to alter the retailers’ and wholesalers’ profits at a month’s, or six months’, notice. We have not . been told this, and we are entitled to be told it. However, I accept the statement the Prime Minister has made that sugar can be sold at 5d. per lb., which price he says will cover retailers’, wholesalers’, and refiners’ profits,- and still give £19 Cs. Sd. per ton to the growers, and £11 per ton to the millers.
– After the overdraft has been wiped out.
– I have already shown the dislocation to business which has been caused by fixing the reduction in the price of sugar so far ahead. Failure to reduce the price of sugar is prejudicing the cause of sugar all over Australia. As a matter of policy, the fixing of the price in November instead of now will cause more serious damage to Australia and her taxpayers than would the failure to actually balance the sheets for the sugar industry. I now move -
That the amount of Supply asked for be reduced by £1.
If this amendment is carried it will be an instruction to the Government to reduce the price of sugar forthwith to 5d. per lb.
– I am at a disadvantage in replying to the honorable member (Dr. Earle Page), who has, no doubt, devoted much time to the preparation of his case. Leaving aside irrelevant, immaterial, and trivial matters, the honorable member has levelled a most serious charge, amounting to corruption, against some person or persons whom the honorable member has not mustered up sufficient courage to indicate. He has spoken of a Mr. Davies and of a Mr. Lee, two gentlemen who were intimate friends - in fact, partners - but who have apparently quarrelled. But he has not ventured to directly connect these gentlemen’s private quarrels with any member of the Government or public official. Behind the honorable member’s curtain of words, he has tried to create an impression in the minds of honorable members and of our fellow citizens that there is corruption somewhere, if not in the Government, at any rate in the Government Departments. The honorable member demands an inquiry. No ordinary inquiry will satisfy him. He wants one in which summary justice’ shall be done. He wants a detailed investigation - every step in these most complex and numerous transactions must be probed to the bottom; but justice must be done without a day’s delay.
The honorable member says that, even if he stands alone, he proposes to fight for justice. I shall not insult Justice by supposing that, after all these years of civilization, she is in such a poor and forlorn state as to depend upon the exertions of the honorable member. The honorable member has insinuated that there has been corruption. We are entitled to ‘be told plainly who is’ the guilty person. I ask the honorable member to have courage, and say what he means. If he means that there is some man in the Government, or in the employment of the Government, directly or indirectly, guilty of corruption, let him give the name of the man, that the Government and the Parliament may take action. To make charges which stop short of naming the accused is an act discreditable -to his honour and our intelligence. Let us examine the transactions to which the honorable member has referred. He is insatiable in his demand for information. He complains that information has been withheld. He would, have us believe that if this be supplied he would be satisfied. But no information, no matter how detailed or how complete, will satisfy him. It is not information he desires, but opportunity to defame and denounce the Government. The honorable member is !best satisfied by finding himself in the position of being able to demand more and more, and still more. The Minister for Trade and Customs (Mr. Rodgers)’ supplied him with a list setting out in detail the particulars of every purchase overseas from 1915 to 1920, giving the date upon which each purchase was made, the vendor, the country of origin, the quantity, the quality, the price, the invoice dates when shipped, and the ships on which each purchase arrived. One would imagine that these particulars supplied a full and complete return. Indeed, with a parliamentary experience extending over more than a quarter of a century, I say that the information supplied by my honorable colleague is a more complete return of Government transactions than I have ever known to be issued. My colleague has told the honorable member that the Auditor-General, whom, he has not yet charged with corruption, or with being a party to this conspiracy, if there be conspiracy, is preparing a detailed balance-sheet setting out the whole position from the very beginning of the sugar control to date. With that I hope the House, if not^the honorable member, will be satisfied. I point out that he has stopped short iri these revelations with which he has sought to make our blood freeze in our veins. He has stopped short of saying that such-and-such a person, or such-and-such a member of the Government, or such-and-such an officer in the employ of this Government or of any previous Government, has been guilty of corruption or improper practice. But the honorable member has sought to create an impression that there has been improper practice and corruption. Let us look into the matter closely. He has referred to three transactions. They are numbered upon the return, which has been made available to honorable members, under the heading of “ Commonwealth Government Sugar Control - Contracts for Foreign Raw Sugar purchased on account of the Commonwealth Government.” I do not wish to misquote the honorable member. I did not catch the particulars of the statutory declaration which he presented; and I must be permitted a later opportunity to peruse the document from which he quoted. I shall not deal with it at this stage, but will ask honorable members to peruse the particulars contained in the statement of foreign purchases. I call attention first to item No. 61. In this instance the contract date is 15th September,- 1920; the vendor is John Nash; the country of origin Java; the quantity of sugar 1,000 tons ; the quality “ whites “ ; the price per ton £72 12s. 6d..f.o.b.; the invoice date 8th October; the ship the Phranang, and the quantity invoiced 1,000 tons. The next item, No. 62, bears for its contract date the 1st October, 1920. The vendor is again John Nash; Java the country of origin; the quantity, 5,000 tons;- the quality “whites”; the price per ton set out as F1., 42.60 p. picul, or £63 10s. per ton f.o.b. The invoice dates are 9th November, 17th November, and 16th November, and the ships respectively are Nichiyo Maru, Houtman, and Canton Maru, and. the quantity invoiced respectively on those three vessels is 4,000 tons, 92 tons, and 908 tons. I next call attention to item 66, the contract date of which is 18th October, and John Nash is again the vendor; the country of origin is Java, and the quantity of sugar 10,000 tons;” the quality “whites”; the price per ton is £54 f.o.b., and the invoice dates 9 th, 17 th, and 15th November, and 1st, 20th, and 5th December; the ships are, respectively, Nichiyo Maru, Houtman, Canton Maru, Malayan, Djebres, and Kenkon Maru; the quantities invoiced respectively upon those vessels are 1,086 tons, 408 tons, 2,000 tons, 600 tons, 2,742 tons, 3,167 tons, making a total of 10,003 tons. These are the three transactions to which the honorable member referred. It is in connexion with them that the honorable member has levelled the charge of corruption by some person or persons whom’ the honorable memberhas not had the courage to name.
It is alleged that the Government are censurable because, at a time when - to quote the honorable member’s words as nearly ‘ as I can remember them - the market was subject to violent fluctuations, we placed orders with one who was not, through long training, an expert in the business. About that I can say nothing. I have not had time to acquaint myself with the reasons why an order was placed with Davies any more than with any other person; but the Government will endeavour to supply the information later. I am going to show now what actually took place, and how it occurred. On 7th August, 1920, Colonel Oldershaw wrote me as follows : -
My Dear Prime Minister.
Purchase of Foreign Sugar.
The Colonial Sugar Refining Company arc very insistent that if we do not purchase 50,000 to 60,000 tons of foreign sugar from Java and/or Formosa, immediately we may not be able to obtain the sugar at ail later on, as the stocks of sugar in the world are very short. Java or Formosa sugars are much stronger and better than Cuba, and worth £6 or £7 more per ton; so that in buying Cuba at, say £75 c.i.f., and Java or Formosa a,t £85, it is really only an increase in price of, say, £3 per ton. The Queensland sugar will be refined principally at Brisbane and Sydney, and a smaller quantity sent to Melbourne and Adelaide,, because foreign sugar can be brought to Melbourne and Adelaide at cheaper freight, and sugar for the two latter refineries must bo here by 1st December.
I strongly urge that approval be given to further purchases without delay; 15,000 tons of Cubas have been purchased, and approval has been given for a further 10,000 tons; but the Sugar Company consider it better to wait a little before purchasing further Cubas,, and, as stated, they are extremely insistent that Java or Formosa sugar should he purchased at once up to, say, 60,000 tons.
The letter clearly sets out the views, not of a motor-car driver or of any other of the honorable member’s friends, but of the Colonial Sugar’ Refining Company - a firm which knows its business. The company stated in plain and precise terms that unless we purchased between 50,000 and 60,000 tons from Java and/or Formosa immediately we should not be able to get any sugar at all. The Colonial Sugar Refining Company was insistent that we should buy, and that it would be better for us to purchase Java and/or Formosa sugars at £S5 per ton than Cubas at £75. The letter is dated 7th August, 1920. I received and minuted it on that date. I shall read my minute. The honorable member for Cowper has made himself responsible for bis statements, and I invite him to inspect all the documents which I quote here. He is perfectly free to satisfy himself concerning the “ exact verbiage of these minutes, verifying the dates, and, indeed, all particulars. My minute is -
I approve. (Sgd.) W.M.H.; 7/8/20. But see that Mr. Greene is consulted before action is taken. (Sgd.) W.M.H.
Two days later the then Minister for Trade and Customs further minuted the letter -
Approved. (Sgd.) YV.M.G. 10/8/20.
The letter of the Colonial Sugar Refining Company, as I have said, recommended the Government in terms precise, clear, and insistent to buy Java white, mid stated plainly that if we did not buy 50,000 or 60,000’ tons we would probably not get any sugar at all. And the Government acted upon that recommendation without delay. I emphasize this fact; it is most important. Immediately upon receiving the letter, I minuted and signed it, and added a note that the then Minister for Trade and Customs might himself have an opportunity to give au independent opinion. My words were: “‘Consult the Minister before you do anything.” In writing as he did, Colonel Oldershaw was acting as the mouthpiece of the Coloni’al Sugar Refining Company. On 10th August - the day on which my colleague, the then Minister for Customs, also minuted Colonel Olderghaw’s letter - another letter was sent bv Colonel
Oldershaw to the Minister for Trade and Customs. It was as follows: -
The following telegram was joceived on !)th August from the Colonial sugar Refining Company Limited, Sydney: - “ Czarnikow telegraphs follows: - ‘All markets weaker, hut no sellers- Cuba yet under 12 dollars. No reply Formosas. Meantime Suzuki may offer 4,000 tons 10 p.c. more or less Java, minimum average 12.5, shipment in October-November, sellers to have option shipment by steamer and/or steamers from Java basis !)fi shipping weight and polarisation. .
There is nothing relevant to the issue in the rest of the letter, but it is minuted as follows: -
Shown to Mr. Greene, 12.40 p.m., 10th Aug., /20.
I wish to be kept informed as to any parcels of Java or Formosa sugars that ave bought in terms of the Prime Minister’s minute on your memorandum to him.” (Sgd.) W.M.G. 12/S/20.
That is the minute to which I have referred. It is a general authority to Colonel Oldershaw to buy up to 60,000 tons of Java or Formosa sugar. Tho advice upon which that authority was given was tendered to the Government by the ‘best experts in the country. We were advised to buy, not at any particular price, but at any price. We were to get thesugar then; otherwise, we would not be able to get it at all.
– And we were to get it where we could; otherwise, we would not get it at all.
– Precisely !
So much for the general position. The shortage of sugar, was acute. The advice to buy insistent. The advisers the best experts in Australia. Now let me deal with the orders in detail. I take the first order. I hope that I may be given a little latitude in this matter, because I arn called upon to go through a great file of papers and pick out from amongth em those which are relevant to the statements of the honorable member for Cowper. I hope honorable members generally will not overlook one most important fact, that the charges of the Leader of the Country party relate to 16,000 tons of sugar. But we bought 500,000 tons of foreign sugar. On 7th September, 1920, William E. Davies, 318 Flinders-street, Melbourne, wrote to me under the heading, “ The Right Honor- able the Prime Minister of Australia,” a.s follows: -
On the 23rd ultimo I received instructions through Colonel Oldershaw. to obtain a firm offer for 1,000 tons No. 25 superior white quality Java sugar.
I -received the . following quotationfrom Messrs. Jas. Nash, merchants, Sourabaya, Java, offering the same at F.50 (florins) -per picul (136 lbs.) f.o.b. Java port.
September Shipment per Steamer.
I am now in receipt of a cable quoting firm at F.48.25 f.o.b., or the sterling equivalent, £73 9s. per ton (2,240 lbs.). Exchange is based on latest bank quotation, F. 10.82. Ninety days sight draft.
It is imperative that I should have an immediate decision, and I beg to mention that Java sugar of this quality is selling freely to-day at F.52, or approximately £80 per ton f.o.b.
Awaiting your commands, I beg to remain, dear sir,
WM. E. Davies.
This communication hears upon it the stamp of the Department of Trade and Customs dated 13th September. It is initialed by me, “ W.M.H.”, and also by the then Minister for Trade and Customs (Mr. Greene). On the8th September Mr. Davies wrote to me as follows: -
Dear Sir, -
Confirming conversation this morning,I beg to hand you herewith amended quotation received by cable . to-day for 1,000 tons No. 25 Java white sugar, packed in sacks 225 lbs., at £72 12s.6d. per ton f.o.b. Sourabaya. This price is based on the florin 10.82, the latest bank quotation to hand - immediate shipment.
This communication was referred to the Department of Trade and Customs by Mr. Shepherd, and bears the typed signature of Mr. Percy Whitton, Acting Comptroller-General. The date is 13th September. On 13th September the secretary to the Prime Minister’s Department received from Mr. Davies the following letter:. -
I hog to acknowledge receipt of your letter dated 11th inst., confirming order for 1,000 tons 25 white Java sugar at £72 12s. 6d. per ton f.o.b. Java….. “ . .
To carry out your instructions it is necessary for you to arrange with your bankers to cable their agents in Java to-day to accept documents from the sellers, Messrs.’ Jas. Nash, merchants, Sourabaya. Payments to be made on a ninety clays sight draft, letter of credit, without recourse against shipping documents.
It is also desirable that I should know when your steamer will be ready to accept the shipment at Sourabaya, so that I can accordingly advise Messrs. Jas. Nash.
This communication was referred to the Acting Comptroller-General of Customs by Mr. Shepherd on 13th September. It is also minuted by Colonel Oldershaw, and bears ‘the stamp of Mr. Percy Whitton, Acting Comptroller-General of Customs, with the date, “ 13/9/20.” ‘Following upon this is a letter, dated 15th September, addressed to the secretary of the Prime Minister’s Department by Mr. Armitage, chief accountant of the Commonwealth Bank, establishing a letter of credit for this 1,000 tons. Another letter, dated 14th September, follows, addressed by Mr. Davies to the Minister (Mr. Greene), in which he writes -
I have pleasure in offering your Government for prompt acceptance or otherwise an additional 1,000 tons No. 25 superior white Java sugar at £71 9s. per ton f.o.b. Java port. . . .
I am not quite sure whether or not that offer was accepted.
This completes the detailed account of the first transaction, which was the purchase of 1,000 tons, at £72 12s. 6d. per ton. It was recommended by Colonel Oldershaw, acting upon the advice of the Colonial Sugar Refining Company, and was approved by the Minister (Mr. Greene) and myself. It passed through the usual channels. Colonel Oldershaw was in daily communication with the Colonial Sugar Refining Company. The price, the quality, the vendor, the agent for the vendor, all were known to, and approved by, Colonel Oldershaw. The authority to purchase was given by the Minister for Trade and Customs and myself. It has been freely stated that, for all practicalpurposes, Colonel Oldershaw was the Colonial Sugar Refining Company. That is -not true; but he was in the closest possible touch with the company. From the time that he came to my office early in the war to the date when he left for England, he did not make one purchase without communicating with the Colonial Sugar Refining Company and obtaining its advice.
Sitting suspended from 6.30to 8 p.m.
– [Extension of time granted’]. - Of the three purchases to which the honorable member for Cowper directed attention, I have dealt with the first, relating to the purchase of 1,000 tons of sugar. I come now to the second. On 29tih September, Mr. Davies wrote to the then Minister for Trade and Customs (Mr. Greene) in the following terms: -
Further to my letter of the 27th inst., I have received a cable this morning from Messrs. James Nash, Java, making an amended offer, subject to prompt decision, with the authority to close fromyour Government, as follows: - “’ 5,000 tons No. 25 superior white sugar at £63 10s. per ton f.o.b. Java ports, prompt shipment.”
The price in florins is 42.60 per picul (136 lbs.).
I trust the above will receive your prompt and favorable consideration, as the cable intimates that this price is the lowest that has been offered for some considerable time, consequently they cannot hold the offer open longer than above mentioned.
On 27th September the Minister, dealing with Mr. Davies’ offer of even date, telegraphed Colonel Oldershaw at the office of the Colonial Sugar Refining Company, Sydney, as follows: -
Following offer received white sugar: - “ 1,000 to 5,000 tons No. 25 superior white sugar at £64 10s. per ton f.o.b. Sourabaya.” Fruit-growers saw me this morning. They are anxious about supplies of sugar for fruit season commencing in about six weeks. Indications are for a very heavy crop. So far as I can see impossible for refineries to overtake demand. Consult sugar company subject to price being right as to whether desirable buy white sugar assist us meet demand for fruit season. Reply as soon as possible.
To that Colonel Oldershaw replied by telegram as follows: -
In reply to your telegram, sugar company, in view of large fruit crop, favour purchase 5,000 tons Java whites at £64 10s. f.o.b., provided this is fixed price, and any variation in exchange is at seller’s risk.
Following upon that, Mr. Oakley wrote, on 29th September, to the Secretary of my Department -
Secretary, Prime Minister’s Department, -
My Minister would be glad to receive consent of the Prime Minister to the purchase of thi3 5,000 tons of white sugar at £63 10s. per ton f.o.b. Java ports. The sugar is most urgently required, and the offer cannot be held open very long.
A: D. Comptroller-General. 29th September, 1920.
Papers received from Parliament House 3.30 p.m.
Mr. Whitton informed me that the Minister had telephoned from Parliament House that the Prime Minister had approved purchase of this sugar.
Informed Mr. Davies personally. * Confirmed by memo. Make the necessary arrangement with Treasury as to payment.
Here, then, we have, in sequence, the documents which set out in full detail the second purchase. I ought to observe here that Mr. Davies is, or was, the Melbourne agent of John Nash, a very well-known and reputable merchant- of Sourabaya, and he was, therefore, making an offer on behalf of his principal. It will be noted that this purchase of 5,000 tons, and that of the 1,000 tons with which I have dealt, were part of that 60,000 tons which the Colonial Sugar Refining Company said were immediately required, and that there was no certainty that the market would improve, but there was a possibility that it would harden, and that we could not afford to take the risk. Subsequent to the insistent advice of the Colonial Sugar Refining Company to buy large quantities of sugar, irrespective of price, the representatives of the fruit industry waited upon the Minister, and pointed out that the fruit season was coming on-, and that it was imperative that an adequate supply of sugar should be provided. When, therefore, Mr. Davies; on behalf of John Nash, of Sourabaya, submitted . a firm offer to supply 5,000 tons of Java whites at £63 10s. f.o.b., the Minister telegraphed immediately to Colonel Oldershaw, who was in the Sydney office of the Colonial Sugar Refining Company, to consult the company as to whether the Commonwealth should buy the shipment, and at that price. Colonel Oldershaw consulted the Colonial Sugar Refining Company, not a motor-tyre manufacturer, and the company advised us to buy the parcel of Java whites at £63 10s., taking the precaution that the price should be fixed, and not be affected by fluctuations of exchange; that was the only reservation the company made. Immediately, the permanent head of the Trade and Customs Department communicated with me, and I, without delay, gave my approval of the purchase. On the- same day the order was placed and the purchase made.
– What date was that ?
– I approved of the purchase on the 29th September, and it was on that day that the purchase was made.
– The actual purchase was confirmed by Davies on the 1st October.
– Why is* there no mention of that date in the published information 1
– It appears on my copy. Its omission from other . copies is a printer’s error.
– The purchase was complete, as Mr. Davies pointed out in many of his communications, when the letter of credit .was made available. These elementary facts in commercial practice, perhaps, cause some astonishment to the honorable member for Cowper, but they’ reflect the every-day practices in ordinary commercial life. I have now given a full, detailed account of two of the three transactions. I ask honorable members what irregularity is to be noted in this transaction? To whom but the Colonial Sugar Refining Company could we go for advice? Indeed, it was the Colonial Sugar Refining Company that the honorable member urged us to consult. We did consult them, and ‘followed their advice right through. The honorable member spoke about Mr. Davies. I do not know Mr. Davies, but I promised to make some inquiries regarding him, and I find that he is the agent for a reputable and established firm in Sourabaya, the name of which was satisfactory to the Colonial Sugar Refining Company.
I come now to the third purchase of 10,000 tons. * On the 8th October Mr. Davies wrote to the Trade and Customs Department, offering to sell 10,000 tons of No. 25 Java whites, at ?54 f.o.b. Sourabaya, November-December shipment. On the same date Colonel Oldershaw wrote to Mr. Davies.as follows: -
With reference to your letter of this date, addressed to the Hon. Massy Greene, and our interview to-day, I beg to confirm having advised you to send the following cable to your principals, Messrs. Nash, of Sourabaya : - “ The Commonwealth Government will buy up to 10,000 tons No. 25 Java whites, ?54 f.o.b. Sourabaya, November-December shipment, but will arrange earliest possible shipment.”
That transaction was carried through on the advice and through the agency of Colonel Oldershaw, who was in daily, and almost’ hourly,- touch with the Colonial Sugar Refining Company; indeed, he spent much of his time in the offices of the company. I shall now set out the details of this transaction. I ask honorable members to follow me, because, whilst the transaction in itself was carried through in the ordinary way, the innuendo behind the statements of the honorable member for Cowper is such that it is only proper that the country should know what value is to be attached to anything the honorable member says.’ I have in my hand a memorandum prepared by Colonel Oldershaw for the Minister for Trade and Customs (Mr. Massy Greene)’. It is dated 8th October, 1920, and the hour is stated as noon. There is nothing vague about that. It says -
Mr. Cerutty; Secretary to the Treasury, asked me to see him, and in his room I found Mr. Heathershaw, Mr. Percy Whitton, and Mr. W. B. Davies, of 533 CollinsStreet. Mr. Whitton handed me a letter, dated 8th October, from Mr. Davies, addressed to the Hon. W. Massy Greene, with regard to an offer of 5,000 to 10,000 tons of No. 25 superior white Java sugar, at ?56 per ton, f.o.b. Sourabaya.
I pointed out that Mr. Davies’ letter stated “prompt shipment,” and that the Commonwealth Government would not buy for prompt shipment, as steamers may not be available so early - it must, be for November-December shipment. At the same time, every effort will be made to ship the’ sugar at the earliest possible moment.
Mr. Whitton suggested that Mr. Davies and myself should proceed with him to Parliament House to interview the Hon. W. Massy Greene, which we did. Mr. Greene said he was anxious to buy a large parcel of Java whites, so as to overcome the shortage of refined sugar, and he considered that this parcel offered by Mr. Davies should be purchased for ?54. I said I would . so inform Mr. Davies that he had authority to offer f54 for November-December shipment.
Mr. Davies came back with me to my office, and I gave him a rough memorandum, reading as follows, as a draft cablegram for him to send to his principals, Messrs. Nash, of Sourabaya: -
Commonwealth Government will buy up to 10,000 tons No. 25 Java whites, at ?54, f.o.b.. Sourabaya, November-December shipment, . but will arrange earliest possible shipment.
Mr. Davies said lie would at once go to his office and send a cable in the above terms to Nash, of Sourabaya. 4.30 p.m. Saw Hon. W. Massy Greene ‘and Mr. Whitton at Customs-office, and telephoned to Mr. W. E. Davies from there. Davies stated he could definitely close the business for the purchase of 10,000 tons, at ?54, if we cabled to our bankers in Sourabaya guaranteeing that when the sugar was purchased a letter of credit would be made available to pay for same. I told him to send a cable on those terms, and I would arrange with the Treasury to have the cable sent regarding guaranteeing. 4.45 p.m. Saw. Mr. Cerutty and Mr. Heathershaw, and told them of the above. Will send them the following memorandum: -
Mr. W. E. Davies, broker, 533 Collinsstreet, Melbourne, informed me on the telephone, while in the Minister’s office this afternoon, that he could close the business for the purchase of 10,000 tons of No. 25 superior white Java sugar, at £54 per ton, f.o.b. Sourabaya, for November-December shipment, and would so cable his principals, Messrs. James Nash, merchants, Sourabaya; but they ask that the Commonwealth Government have a cable sent to their bankers in Sourabaya,, guaranteeing the payment for the sugar in due course, on shipment, that is, up to 10,000 tons, at not exceeding £54 per ton, f.o.b., and that a letter of credit be provided when the transaction is confirmed.
Surely no transaction ever carried through, has been set out with more wealth of detail. The memorandum, gives the names of the persons seen, the circumstances under which they were seen, the places where they were seen,’ and the details of the conversation which took place. We might imagine, indeed, that we were reading a. page of Pepys’ diary. Whatever else it lacks this memorandum of Colonel Oldershaw i’s certainly full of circumstantial detail’. That closes my account of the transaction to which the honorable member has alluded. I ask honorable members to note that they have been supplied with details which should convince them and our fellow citizens throughout the country that the transactions have been carried through on business lines. We have not gone to motor-car drivers for advice, but to the Colonial Sugar Refining Company. We acted on the advice of the company right through. Colonel Oldershaw was the agent through whom all these purchases were made. His was the advice that we sought, and the advice which he gave was obtained by him from the Colonial Sugar Refining Company. The relation between Colonel Oldershaw and the Colonial Sugar Refining Company was constant and obvious.
Now let me set out, by way of summary, the salient features of these three transactions -
On 7th August Colonel Oldershaw recommended the immediate purchase of up to 60,000 tons of Java or Formosa sugar, stating, “We may not be able to obtain the sugar at all later on, as the stocks of sugar in the world are very short.”
This is an excerpt from a letter from the Colonial’ (Sugar Refining Company to either myself or the Minister for Trade and Customs.
The Prime Minister approved, minuting the papers, “ See that Mr. Greene is consulted before action is taken.”
Both the Minister and myself minuted this paper, and one or other, and generally both, minuted every other paper relating to the purchase of sugar.
Mr. Greene saw the papers, and on 10th August, 1920, approved. Colonel Oldershaw proceeded to place orders accordingly.- On 7th September, 1920, W, E. Davies, broker, wrote as follows: -
On 23rd ult. I received instructions from Colonel Oldershaw to obtain a firm offer for 1,000 tons No. 25 superior . white quality Java sugar. . . .
He then quoted 1,000 tons, at £73 9s. per ton. This price was accepted by Mr. Massy Greene and the Prime Minister, and the order passed out for execution. Before receipt of same, however, Davies,” the following day wrote, quoting £72 18s. 6d., or 16s. 6d. per ton less. This amended price was passed through P/Secretary the Secretary Prime Ministers Department (Mr. Shepherd), to Trade and Customs, who, on 13th September, wrote to Mr. Davies, formally accepting the offer of 1,000 tons at the lower price.
On 28th September, 1020, Davies wrote direct to Mr. Massy Greene, offering 5,000 tons of Java sugar, at £63 10s. This was accepted the same day in a letter signed by Mr. Oakley.
On 8th October, 1920,i Davies again wrote direct to Mr. Massy Greene, offering from 5,000 to 10,000 tons of Java sugar, at £56 per ton. Mr. Cerutty, Acting Secretary to the Treasury, with Mr. Heathershaw, Mr. Whitton, and Colonel Oldershaw, discussed the offer at the Treasury on the same day. Mr. Whitton suggested that Davies and Oldershaw should proceed to Parliament House and interview Mr. Greene. This was done. Mr.’ Greene said he was anxious to huy a large parcel of Java, sugar, and he considered Davies’ offer should be accepted - but et £54. Oldershaw communicated this to Davies, and confirmed, it in a . letter of 8th October.
The above comprise all the orders placed ‘ with Davies.
– Does the Prime Minister know anything about the man Lee, who has been mentioned ?
– I have been told something, but I will leave that aspect of the subject to those who are better able to deal with it. I come now to the question of whether we got value for our money. We may be asked this question. While the sugar markets of the world were fluctuating wildly, did our advisers give us- good advice? The answer to this question will be found in the facts which I shall retail to honorable gentlemen. It is easy to be wise after the event. We can all tell what sugar was worth on the 16th of last August, but on the 14th of August it is not so easy to say what it will be worth on the 16th. Regarding the first transaction, 1,000 tons of sugar was purchased at £72 12s. 6d. per ton. At the actual time of purchase the current market price was about £67 10s. per ton. In that transaction we paid £5 2s. 6d. above the world’s price. The 5,000-ton lot was purchased at £63 10s., which was the current price at the time of purchase. We made the agreement to buy before the time of purchase, for it was an agreement to buy which was not complete until the letter of credit had been deposited, and during the interval the market fluctuated and the exchanges rose or fell.” I come now to the third, transaction. This was approved of on the 8th October, and 10,000 tons was purchased at £54 per ton, the current price at that time being £63 per ton. Summing up the three transactions, then, we find that on the first purchase of 1,000 tons we lost £5,000; on the second’ purchase we lost nothing; and on the third purchase we gained £90,000. That is the plain statement of the facts. In the face of them, what becomes of the honorable gentleman’s innuendos of corruption 1 Who- is this gentleman who gave information to the honorable member of this tittle-tattle? I am informed that he has been trying to see me for two years in order that he may gratify some spite which he has against his quondam partner. He has not seen me. That pleasure, given to honorable members every day, has been denied to him, and he has fallen back ‘upon the honorable gentleman. This is the bombshell that the honorable gentleman has dropped into this peaceful place. The whole country will be convulsed at this mare’s nest which- he has discovered. He has thought fit to hold up .public business and to endeavour to obtain the support of members of the Opposition by what a distinguished man who once occupied my position termed “ insinuendoes.” The honorable gentleman ought to be prepared to say, now that he has the facts before him, “ I have been mistaken. I was wrong to charge any one with corruption and malpractice, or to allege that the Government did not do whatever was humanly possible to obtain sugar for the people of this country at the cheapest possible price.” Will he play, the part of a man and do this ? He has sought ‘ to defame the character of a public servant under cover of privilege. Will lie not- now do him justice ? He has treated the Committee to a farrago of nonsense about the misfortunes of his party, and has invited honorable members to shed tears with him over the machinations of which, he says, I have been guilty. He declares that I have been going about the country persuading those who control his party not to vote for him. If I have been successful in that I deserve a crown, and my statue should be placed in every one of the cities of this Commonwealth, so that the people may sec the nian who saved the country. But what has all that to do with the granting of Supply? What docs it matter whether the honorable member himself, let alone his party, gets into this House? No thing - less than nothing. He has been here only ten minutes, and he brings to every discussion a wealth of ignorance that is appalling. He mistakes the unimportant for that which matters, and never sees anything that is, or can possibly be, of interest to the- general community. He allies himself continually with men on whose heads he pours scorn every day.
– The right honorable gentleman’s time has expired.
.- The right honorable the Prime Minister (Mr. Hughes) has concluded his remarks, as usual, with a torrent of abuse, and I have no inclination whatever to follow him in that line. But I do ‘wish to say a word or two concerning some of the statements he has made. He has said that the Leader of the Country party (Dr. Earle Page) has brought here - I forget his exact words - something that does not matter - “tittle-tattle.” The Leader of the Country party has brought here sworn statements and affidavits, and when an honorable member is furnished with such by citizens of the Commonwealth in reference to public affairs, it is right that they should be ventilated in this House. If the man who made these affidavits can be shown to have forsworn himself, then there is a proper place to deal with him ; but it is hardly right for the Prime
Minister to call such evidence as has been produced, “ tittle-tattle!” I wish to deal with one of the right honorable gentleman’s misstatements; there were more, but one in particular struck me. The Prime Minister. . stated that on the 7th August he was sent advice by Colonel Oldershaw that it was necessary, according to the ideas of the Colonial Sugar Refining Company, that Australia should make heavy purchases of sugar. He led this Committee to believe that those operations with Lee, Davies, and Nash were begun after that advice from the Colonial Sugar Refining Company. As a matter of fact, the date given by the Prime Minister for this information is the 7th August, and he said it was then communicated to the Minister in charge of sugar control, and the contract entered into on the 9th, whereas Lee was sent to Java by Davies prior to that. The first arrangement made between Lee and Davies was early in May. The agreement was actually reduced to writing on the Sth July, a mouth before the time when the Prime Minister tells us that he was advised by the Colonial Sugar Refining Company that it was necessary to buy this large amount of sugar, and when he used those unusual agents. That is one statement which can very easily be disproved by the facts laid before ‘the Committee., There is another point in connexion with the statement. The Minister now in charge of the Committee (Mr. Greene) drew attention to the fact that there is a date given for those contracts made with Nash and Company; but under the statement which was issued to the House last week there is no such thing as a date to any of them.
– The honorable member is wrong.
– We have the copies.
– They were all issued at the one time.
– The older copies have no dates shown for those three contracts, whereas there is a specified date for every other contract throughout the whole document. That is so marked that in my particular copy, I have written under each of these contracts ‘ “no date.” Before the dinner adjournment, when the Prime Minister was dealing with this matter, he did not tell us that the dates had been omitted from the paper, but he asked, ‘ What does it matter ? You have the date of the invoice.” It would seem that the dates have been interpolated since. In any case, what does the date - of the invoice show? On page 6, as to contract 59, the date is shown as the 13th September, 1920, but the invoices are dated 1st, 15th, and 17th November, and 6th December. It is useless for the Prime Minister to tell us that the invoice date gives us the time of the contract.
– He did not say that.
– The Prime Minister did say so before dinner, but when we met after dinner the Government produced a paper absolutely contrary to what ; the Prime Minister had previously upheld. The right honorable gentleman then said, “ I will give you the dates of the contracts.” What sort of a way is that to play with the Committee - to treat the community at large? The statement of the Prime Minister before dinner, and the statement after dinner are entirely different. What are we to believe?
– No, no; you have got hold of a “ mare’s nest.”
– There seems to be a good many “ mare’s nests “ about, but I am taking the Prime Minister’s own remarks. The members of this Committee heard him definitely state that he could not give us the dates, of the contracts.
– What is the inference ?
– That these dates have been put in since.
– What of it, if they are correct?
– I have disproved completely the statement of the Prime Minister. There is another very significant point. I have never before tried to throw any damaging shadow on the honesty or honour of a Government, but when we find a party which will make an improper use of the name of a sick man for the purposes of a pair, are we not entitled to be suspicious? We know thai the honorable member for Dampier (Mr. Gregory) did not wish to pair on the side for which he was paired ; indeed, we all know that he is too ill to be bothered about such matters. We, the members of the party to which he belongs, know that his inclinations were on the other side, and yet he was paired on the Government side. I again ask, have we not a right to be suspicious?
– This is “ playing it “ as “ low down “ as is possible.
– It is an absolute fact, and you know it, sir. We can prove by correspondence that the honorable member, who belongs to our party, has been all along-
– Stick to the pair question !
– The honorable member, would have paired on the other side.
– That is not so.
– We of his party ought to know. What has become of Colonel Oldershaw? Why were these contracts put through Colonel Oldershaw ‘s office direct from the Prime Minister in some cases ? Colonel . Oldershaw received word, from the Prime Minister concerning these matters, and went on with the business. In every business it is recognised that, besides the head man in charge of a particular branch, there must be some one to keep records;, but in Colonel Oldershaw’s office, so far as we can find out, and so far as has been made public in. the evidence given before the Public Accounts Committee, there was no one but his typiste. When Colonel Oldershaw was given leave of absence by the Prime Minister, not through the ordinary channel of the particular Minister in charge of the Department, to take this tour abroad, there were no records whatever left in his office, and no one to carry on. Is that a proper way to do business? Is it a proper state of affairs that a man should be given leave of absence by the Prime Minister-
– On full pay.
– Yes, on full pay. Is it proper that he should be given leave of absence when questions of this sort are being brought up every day.
– What is his pay?
– That is not the question with me. The point is that this officer has been Bent away, or allowed to go away, on a holiday on full pay, and no records are left behind at a time when sugar is a burning question with the people of Australia. Is it not proper that, when matters of this sort arise, and sworn statements and affidavits are produced, these should be ventilated here?
– Do you suggest that Davies and Lee were servants of the Commonwealth t
– No. Up to that time the Government had put all its contracts through recognised firms of high standing, but all of a sudden, when the Prime Minister says he was advised by the Colonial Sugar Refining Company, the Government started to put the contracts through the firm of Lee and Davies. Lee was sent to Java by Davies to deal with the matter there, but apparently they “ fell out,” and then the contracts went through Nash, who became Davies’ agent. It is of no use for the Prime Minister to talk about Davies being Nash’s agent, when Davies had sent Lee over, in the first place, to do business, and then “ sidestepped “ him and employed the other man.
I wish to go one step further and deal with the question of price, which, after all, is the live issue. The real cause of the high price that housewives in Australia have to pay is not the money that has been paid to the growers, but the large sums given for foreign-grown sugar. A contributing factor to the inflated retail price is the improper manner in which the accounts have been kept. Five years ago £415,000 was paid from the Sugar Account into the ordinary revenue.
– That has nothing to do with, this Pool.
– It has a good deal to do with the fact that the Government are now recouping themselves. If the £415,000, which was paid over five years ago, had been left to the credit of the Sugar Account, it would have earned interest to the extent of a little more than £100,000, and that amount, at any rate, could have come off the price of sugar. There are possibly a number of other things that could be ferreted out if honorable members had a full statement of the position; but the Colonial Sugar Refining Company has had control, and the Government have given us no figures sufficient to enable us to form a true estimate’. We had no information to show at what price sugar could be sold until we dragged it from the Government in a piecemeal fashion. There has been the half-yearly review by the AuditorGeneral, and we know that recently the Government have- been making a gross profit of £6 6s. 2d. per ton. On all the facts produced in the Chamber and laid before the public, it appears high time that the Government reduced the price, and I hope that the Committee will vote solidly for the amendment of the Leader of the Country party (Dr. Earle Page) that a reduction to 5d. per lb. be made forthwith.
– One naturally finds it a little difficult, after the speeches of the honorable member for Cowper (Dr. Earle Page), and the honorable member who has just resumed his seat, to deal with the question in any adequate, manner. I have heard many attacks launched in this House from time to time by various members against the Government of the day, but I have never listened to anything more contemptible than the attack to-night of the honorable member for Cowper (Dr. Earle Page). I never heard a case so utterly paltry and weak, and based on such wretchedly poor premises, as those on which he attempted to build up a case. He had not the courage of an ordinary decent man. He was not prepared to say that the Government had been corrupt over their sugar purchases. He had not the common decency to make a charge, and lay it against anybody, but he took refuge in the cowardly expedient of throwing out innuendoes, in the hope that they might attach to me. His one object was to attack myself.
– Honorable members -associated with him know that just as well as I do. He had no reason, and he had no right, whatever to suggest that there was any corruption, which he did, unless he believed that the Government were a party to it. If a Government official has been doing something wrong, was not the ordinary and straightforward course for the honorable member to go to the Minister, under whom the officer was working, and say, “ Look, I have this information about this man ; I think you should inquire into the matter and see if he has been doing anything wrong.” That would be the straightforward and honest course for the honorable member to take, if he believed that the officer was corrupt. No; that was not his object at all. His intention was to attach to myself, and to other occupants of the Treasury bench, ‘the imputation that we had been connected with some corrupt action. So the honorable member brings the matter up, not to make a charge, not to say that any honorable member has been corrupt, but just to throw out the dirty innuendo of corruption, without having the honour and common manliness to make any definite charge. I have seen some contemptible things done here, but never anything quite so despicable as that. Never have I seen any charge thrown against any Government that was based on such a wretched and miserable pretext as the alleged statutory declaration of this individual Lee. The honorable member comes along with this man, whose history, perhaps, will some day be told. I am not going to tell it to-night.
– Is that an innuendo?
– No, I am not imputing anything to him.
– He was in partnership with your agent.
– No. So far as I can say, we do not know him. It was left for the honorable member for Cowper (Dr. Earle Page) to be associated with that gentleman. It was in that honorable member that this gentleman found a fitting medium for an attack on the Government. I now leave that phase of the question for the moment.
Let us come now to the actual purchases. The honorable member for Robertson (Mr. Fleming) said just now that the date given by the Prime Minister (Mr. Hughes) of the representations of the Colonial Sugar Refining Company to the Government to purchase sugar was subsequent by a month or so1- I think he said by a month and a few days - to the actual date of the’ arrangements made between the two gentlemen mentioned by the honorable member for Cowper (Dr. Earle Page), Messrs. Lee- and Davies. I shall give the date of the first letter that was written by the Colonial Sugar Refining Company to the Government dealing with that particular season’s sugar. It was not the 7th August, but the 20th June, 1919.
– The 7th August is the date the Prime Minister gave us.
– There were many letters, but the Prime Minister dealt with the subsequent ones. The first one referring to that particular year’s purchases, so far as I can see from the file, is dated, not .the 7th August, but the 20th June.
– These people made their first arrangement in May. It -was reduced to writing on the 8th July.
– The letter from the Colonial Sugar Refining Company is dated the 20th June. The arrangement referred to by the honorable member for Robertson became an agreement, according to the honorable member, in July. The letter from the Colonial Sugar Refining Company was mitten to Colonel Oldershaw, and deals with the whole question of the probable shortage, which., at that particular time was a matter of guess work. In. it the Colonial Sugar Refining Company states -
Unfortunately, the local crop will not cover the consumption by at least 100,000 tons. Based on last year’s deliveries all this shortage must be filled up by importing foreign sugar. The price of such sugar is, however, at present so high that a heavy loss will be incurred by selling the refined products at the rates now ruling here; but, as it is quite impossible to forecast the future of the sugar market, it is also impossible to determine whether it would be wise to defer purchasing in the hope of the market falling later in the year. The danger of such delay is, of course, that the sugar may not bc available when it is wanted, and if the Government wish to avoid that risk they should purchase now, at least, one-half their requirements, anil adjust the selling price, so as to provide for the high price of the raw article.
The definite advice of the company, on the 20th June, to the Government, was that we should buy 50,000 tons of sugar, at least, to meet the anticipated shortage in 1920. That advice was repeated over and over again. I remember the period very well, because it was a time of tremendous anxiety for me, who was the Minister primarily responsible for that particular work. I have a clear recollection of taking the whole matter to Cabinet and stating exactly what I thought about it. At last we gave permission to buy 25,000 tons of Cuba sugar, and I think it was purchased in two or three lots. The company, however, as mentioned by the Prime Minister, kept hammering away at us to buy more sugar, and the reason was that they were afraid that we would reach a position when we could buy no sugar at all owing to the world shortage. Nobody knew, at that time, what the true world position was. Nobody could then say what was going to happen. At the time that the company gave us the advice on the 20th June, raw sugar, as nearly as I can remember at the moment, was about £85 per ton f.o.b., and the company advised us to purchase 50,000 tons. The great difficulty was that we did not know whether we would be able to get all that we required. At the same time we were extremely anxious not to buy more than was absolutely necessary while the market price was so high.
Difficult as that position was, it was suddenly made infinitely more trying by the fact that we were faced with a strike, which hung up, not only all the shipping, but deprived the refineries of coal. We were in the. position of having our raw sugar coming in in the north to the mills, and we could neither ship, our sugar down south, nor could we get coal from the mines in Newcastle to refine the sugar that we had on hand. It was not long, before the whole of the stocks of refined sugar were exhausted. We kept a little, it is true, for the hospitals, and for a few special industries that could not keep going without it, but the whole of the stocks of the refined article were absorbed, and on top of that we had the fruit season coming on. My colleagues and I put in about as anxious a time as it is possible for men to go through, faced, as we were, with that position. Still we did not know where it was possible to get sugar, or even if we could get it at all, at any price. When the position eased a little, it was quite clear that it was impossible for the refineries to catch
Up to the requirements of Australia for the refined article to meet the demands during the fruit season. The refineries depend upon the winter months and early spring, when the consumption of sugar is at its lowest point, to build up their supplies, so that they may meet the requirements of the fruit, season at that stage when the consumption of sugar goes up by leaps and bounds. It was quite evident that the refineries could not meet that demand, because, just at the very time when they ought to have been building up their supplies, the whole of their reserves of white sugar were swept away, and it became- necessary to purchase white sugar overseas wherever we could get it. If honorable members look at the list of oversea purchases, they will see that the sugar we bought at the time the purchase of Java whites was made, of which the honorable member for Cowper is complaining, was all white for prompt delivery, as prompt as we could get it ; > because, although Java whites are not refined sugars, they could be used at a pinch to preserve the fruit crop. I want honorable members in the Country party who are attacking the Government for having bought this white sugar to remember that’ if the Government had not seized the opportunity of buying it at that particular time, and getting it here, there was not one grower of jam fruits in Australia who could have preserved his crop.
– If you had allowed them to import when they wanted to do so, it would not have been necessary to buy in that way.
– I shall deal with, that point later on. I think I know as much about the sugar question as any other honorable member does. The only reason why we bought white sugar at that time, and were prepared to take it from any source, provided we could get it at a reasonable price, was because had we not done so, the fruit crop of Australia would have been ruined. We knew that this was the case. It was a desperately anxious time. However, by using every means at our command, and by endeavouring to arrange shipping so that the vessels conveying raw sugar would pick it up in small lots, and drop it at the different refineries, and so that the whole refining process could go on uninterruptedly upon a definite time-table- that, taken together with these shipments of Java whites, enabled us to get sufficient refined sugar to meet the requirements of the fruit crop; and it was solely owing to the efforts put forward bv the Government that that crop was saved.
Mr.Fenton. - The honorable member is speaking of the jam fruit crop.
– Of course, I am talkiug of jam fruit.
I am not going over the ground the Prime Minister has covered. All I want to say as a final word in connexion with the details of the actual purchases of Java whites through Davies is that Davies put up another offer to the Government beyond those mentioned by my Leader, and it was turned down bv us. The telegram is in the file showing where the Colonial Sugar Refining Company bought a similar parcel to that which Davies was offering, and as our agents paid a little more than the price offered bv him-
– They paid £72, and Davies offered it a,t £71 9s. per ton.
– That is so. With the exception of the three transactions referred to, every other transaction relating to the purchase of foreign sugar has passed through the books of the Colonial Sugar Refining Company, for the reasons I have given. But every transaction was referred to that company before we acted. We did not purchase any sugar unless, and until, the Colonial Sugar Refining Company had advised us that, in their opinion, it was wise to buy, and that the price we were asked to pay- was fair. The honorable member for Franklin (Mr. Mcwilliams) has said several times that he offered the Government sugar at £7 10s. per ton.
– I did not, but I told you that you could buy at that price.
– The honorable member says that he told us this in August, 3918. The war was then in progress. I do not know why he told me. I have no recollection of the matter, and that is all I oan say, because at that time I was not dealing with the purchase of sugar.
– Has the Minister any recollection of a deputation waiting on him in October of that year in reference to the same matter?
– I am talking about the honor able member’s statement that we could have purchased sugar at £7 10s. per ton.
– You could have done 60.
– The honorable member blames us on the one hand for not purchasing sugar from some source - I do not know what it was.
– It was Java.
– On the other hand he blames us for buying sugar. I do not remember anything of the conversation which he alleges he had with me.
– Do you remember the deputation that waited on you?
– I am talking about the alleged conversation. I remember nothing about it, but I take the honorable member’s word that he had it with me. In any case, I was the wrong man for him to approach, because at that time I was not dealing with the purchase of sugar. Over and over again the honorable member has said that we were to blame for not having bought, when sugar was £15 or £14 per ton, all the requirements of Australia to meet the expected shortage during the period of control. This is one of the most extraordinary of all the extraordinary statements that have been made by honorable members of the Country party. I wish I had time to-night to deal with . the whole sugar position and with the many phases of it. However, I want to deal with this particular aspect of- it. Surely the honorable member for Franklin is not aware that the Commonwealth Government were under contract to buy all the sugar that is produced in Australia, and that when he offered us, as he says, this fancy price in August, 1918, the year 1917-18 had just closed with a surplus of 53,000 tons of sugar despite the ravages of the cyclone. It was a little awkward for the honorable member to suggest at that stage that it was necessary for the Commonwealth Government to buy enormous quantities of sugar when we did not know what the crop that year was likely to produce, and had not even the foggiest of information as to what the crop in the next year was likely to be. I suppose that” the honorable member, with that wonderful prescience which he has always exhibited in regard to the sugar question, knew not only what the crop was likely to be in the year 1918-19, but also what it would be in the year 1919-20.
– Has there ever been a surplus of sugar for two years running in Australia?
– Yes. I do not need to go very far back in the history of the industry for an illustration. There has been a surplus in the last two years, and this interjection of the honorable member is typical of the colossal ignorance. he has always displayed in regard to this primary industry. We closed the year 1917-18 with a surplus of 53,000 tons, and the one fear of the Government at that time was that we would be landed with a big surplus -of sugar bought at a price above the world’s parity with which we would not know what to do. How ever, as the season advanced and the crop came in, we discovered that, owing to the effects of a cyclone - one of those big seasonal conditions which attack the sugar industry from time to time - the cane had been so shaken over a very large area that instead of 8 tons or 8½ tons of cane yielding 1 ton of sugar, as is customary in the north, it required 11 tons or 12 “tons of that season’s cane to produce 1 ton of sugar. , Consequently, our estimate went to pieces. Of course, the honorable member knew all about it. He knew that all these happenings would take place. Unfortunately, the Government were not so informed, being only normal human beings. Nevertheless, we bought all the sugar required in that year at a price which enabled us to sell it without any loss. That was the year 1918-19; but during the succeeding year, 1919-20, we were again confronted with a sugar season which looked very bad, and in February, 1919 - I want honorable members ‘to notice the date particularly - just after we had got in the 1918-19 crop, I began to feel concerned, owing to the reports of the drought in the cane area in Queensland, as to the crop in the 1919-20 season. I knew that the sugar market was steadily rising. This waa after the war. No one suspected for a- single moment that we were to see the most phenomenal rise in the price of sugar the world has ever seen. However, on the 14th February, 1919, 1 wrote to the Colonial Sugar Refining Company in these terms -
From a perusal of your letters, it would appear that probably from 80,000 to 90,000 tons of sugar will have to be imported to cover the gap between the date when the 1918-19 Australian sugar crop will have been consumed and the arrival of the next Australian sugar crop, in July, 1920. As it is a somewhat unusual course for the Government to undertake the purchase of such quantities of foreign sugar,, at high prices, for delivery, say, one year hence, I Shall be glad to be fortified with’ the benefit of your experience and advice, in the matter. Will you be good enough to inform me, for the information of the Government, whether, in your opinion, it is advisable for the Government to make arrangements through your company to purchase at once all or any portion of the anticipated shortage?
That is to say, on 14th February, 1919, I wrote to the Colonial Sugar Refining Company, asking their advice . as to the purchase of sugar for the year 1919-20. Not an ounce of the sugar in regard to which I was writing would he required for consumption until over twelve months after my letter was written. The Colonial Sugar Refining Company wrote, in answer, as follows: - . . Under normal pre-war conditions we would not have thought of buying sugar in the beginning for shipment towards the end of the year unless prices were, in our opinion, exceptionally favorable, which cannot be said to be the case at present. Seeing, however, that so large a quantity of imported sugar may be required by Australia, and that the future course of prices and the extent of the demand by Europe are unknown, we suggest that the position as affecting the necessary supplies of sugar should receive the early consideration of the Government. We know that, notwithstanding the large crop in Cuba, estimated at 4,000,000 tons, the American Sugar Commission has entered into an agreement with the Cuban planters to secure it at somewhat above £25 per ton f.o.b., that the next crop in Java is expected to bc 15 per cent, smaller than the last one, and that the Royal Commission is reported anxious to operate in Java when tonnage is available - factors which cannot be overlooked in any attempt to gauge the prospects of the world’s sugar market during the current year. In order- to obtain the latest information available about the future position we telegraphed to Messrs. Czarnikow asking their opinion, and they have replied as follows: -
According expected supply and increased consumption don’t anticipate large surplus end year which case f.o.b. values unlikely decline materially under these circumstances, perhaps .advisable now purchase portion requirements OctoberNovember. from which it would appear that, while there is no urgency to secure full supplies at present, it would be prudent to buy a portion of these, and this seems to me “ to be sound advice.
That letter was dated 3rd February, 1919. I wrote further on the matter, to which they replied, as follows, on 17th February: - . _ . Since then further advices have been received from London recommending us to commence buying, and these have, no doubt, been prompted by the strong demand especially from Japan. As things stand we would, if acting on our own account, and able command freight as well as control the selling prices for the refined products, buy now 40,000 to 50,000 tons, leaving the balance of requirements to foe secured later, tout remaining ready to act quickly if the occasion calls for this.
The Colonial Sugar Refining Company then advised us to purchase from 40,000 to 50,000 tons, in their letter, which is dated 17uh February, 1919. If honorable members will refer to the sheet which has been circulated, they will see how much sugar we purchased shortly after that letter was written, and they will find that, instead of the Government purchasing 30,000 to 40,000 tons, we bought, altogether 84,000 in the course of the next few weeks. I took the full responsibility of doing that. Honorable members will see that the (highest price paid was £25 10s. per ton. We bought immediately 66,000 tons. That sugar was not required for consumption in Australia for twelve months, and when it went into consumption the price was in the vicinity of £90 per ton instead of the price at which we bought it.
We have heard a great deal concerning the ‘ alleged muddle which occurred in connexion with foreign purchases, but if honorable members will study the table in conjunction with the correspondence that passed between the Government and the Colonial Sugar Refining Company they will find that the two outstanding facts are that when sugar was cheap - with one negligible exception - we purchased more than the Colonial Sugar Refining Company advised, and when it was dear we purchased less. These facts can be proved from the files. The action of the Government in purchasing 84,000 tons instead of 40,000 tons saved the Australian consumer - taking the price which was ruling for sugar when it went into consumption -nearly £4,500,000. When we hear honorable members repeating the parrot cries that appear, day after day, in rubbishy statements in the press; written by persons who do not know the first thing concerning the matter, and repeating those statements without attempting to get at the facts, one cannot be other than disgusted. The Committee which is to inquire into the whole matter will have all the information at its disposal, and when it reports to this House I believe, if the investigations are carried out (honestly, and with a desire to get at the truth, as I believe they will be, the report will tell a story of which this Government will never have cause to be ashamed.
– This afternoon a Government supporter talked out a motion which I had brought before the Committee, and, as I believe some honorable members are very anxious to record their votes, I desire to give notice of a further amendment. I have nothing to add to the statements which I previously made.
– The honorable member will not be in order in discussing a matter which has already been disposed of.
– I intend to move that the amount be reduced by the sum of 10s. as an instruction to the Government that the Committee disapproves of its action in submitting the Kidman and Mayoh contracts, to a secret inquiry.
The TEMPORARY CHAIRMAN.The honorable member will not be in order in dealing with a matter that has already been disposed of.
– I have merely given notice of an amendment which, when moved, will enable honorable members to record a vote.
.- So far as I could understand his remarks, the honorable member for Cowper (Dr. Earle Page) did not charge the Prime Minister (Mr. Hughes) or any other Minister with dishonesty. He did, however, bring before the Committee certain information on which action should be taken. The Prime Minister and other Ministers turned themselves into vituperation machines, and made vitriolic statements concerning a certain honorable member, merely because he brought before the Committee evidence of corruption, inasmuch as amounts of £1,500 and £1,000 were paid to hush up certain transactions. The Prime Minister stooped to such low criti- cism as to refer to the voice of the honorable member and the general manner in which he presented his case. The right honorable gentleman mav be endowed with vocal powers which mav or may not be a credit to himself; but there is no reason why he should comment on the vocal powers of others. The Prime Minister, and, ‘ subsequently, the Minister for Defence (Mr. Massy Greene) were ‘anxious to know where certain documents were. I hold in my hand a document signed, sealed, and delivered with a receipt for £1,500 attached. That is no myth.
– What does that prove against the Government?
– I do not think that it reflects directly upon the Prime Minister or any other Minister, but we want to know on whom it does reflect. A week or two ago I moved for the appointment of a Select Committee, and no honorable member should have endeavoured to burke such an investigation. In November,. 1921, Davies entered into an agreement with Lee, the original of which I have in my hand, in which agreement Davies paid Lee £1,500 compensation which, together with £1,000 already paid, made a total of £2,500 in all. Lee covenanted therein as follows: -
Forthwith to hand over to the said William Edward Davies all documents, agreements, papers, and writings, including copy documents, agreements, papers, and writings relating to or in anywise connected with any business transactions or otherwise in which the said Benjamin Joseph Lee and William Edward Davies are or were anywise interested, and all his right, title, estate, and interest in and to the same.
At the same time Lee was called upon to make, and did make, a statutory declaration in which he declared -
On the 9th August, 1920, Davies cabled to Lee in Java as follows: -
Regret to inform you have lost the business. (Boycott?)
We find the significant word “ boycott” inserted here in brackets. The cable proceeds -
Forty-seven finest grade white. Cannot buy any more January.
If the Government are sincere in desiring to find the truth they will agree to the appointment of a Select Committee to inquire into this specific piece of ‘ purchasing. The subject of reference to the Public Accounts Committee may occupy that body for months. I stress the fact that we should concentrate upon this matter. If the Government Wish the light of day to be let in upon these transactions, no matter whether they may involve Government officials or any other citizens, they should sincerely indicate their desire here and now. They should not hesitate to make the fullest investigation.
– Is the honorable member a. member of the Public Accounts Committee ?
– Yes, and the Chairman of that body will bear me out when I say that I opposed the proposal that the Committeshould deal with the sugar question.
So. far as one is able to’ ascertain, this man Lee was in Java, and Davies, who had newly become a sugar broker, was in touch with Lee. The latter was Davies’ agent in Java, while Davies was Nash’s agent here.- I urge that an inquiry be instituted in order to learn the significance of that cablegram of 9th August, because on the day that the cable was despatched Lee was offering sugar at £71 9s. 6d., through his agent, Davies, here, to the Commonwealth Government. But it would appear that Davies was then playing up to two masters. A stage was reached when he realized that he could no longer serve two masters, when he perceived that there was more capital to be got out of his relations with Nash, wherefore he gave. Lee the cold shoulder. I repeat that Lee, as agent for Davies, was offering sugar at £71 9s. 6d. on the same day when the Government bought sugar at £72 12s. 6d. from Davies as agent for Nash. When these transactions became known tol this duplicate agency, friction very naturally developed, and these people had to divide their spoils. The whole of the truth was not told. They were supposed to have “ gone halves “ in these spoils. But when they were able, by other and closer transactions - which. Davies apparently had here with the Prime Minister’s Department - to get further into the finances, Lee was left with a smaller amount; and, doubtless, he is now disgruntled. But whether he is an honorable or a dishonorable gentleman, such covenants as these - made in writing, and copies of which have now received the light of day in this chamber - should be investigated without any question of the Government desiring merely to gloss things over with a statement to the effect that Lee is a dishonorable man-. Davies, only in the month of June, before these transactions occurred, was made an agent for Nash. He gets into the good graces of the Government, and obtains contracts such’ as have been revealed, while the Government are paying Colonel Oldershaw £1,000 a year, and providing him with a staff for the same work. This man, Davies, has been dignified by the Prime Minister with the title of “ sugar broker “ ; but he was only that for the matter of three months, or thereabouts.
We desire that the Government shall assist us in instituting a proper investigation concerning this man. If the Government have made mistakes with respect to these agents of theirs, they will be playing a more honorable part in admitting their mistakes rather than that they should try to bluff us out of an inquiry. Daylight should be let into the whole of this new phase of the business. These allegations may be only a “ dud “; but let them be proved as such rather than that the Government should content themselves with the use of epithets such as I regret to say they have uttered in this chamber, but which should never have been used between gentlemen.
Now here is another) communication, which may or may not be authentic, but which leaves a very suspicious sentiment in my mind at least, and which, when I have read it, may possibly impress the minds of other honorable members similarly. The document which I am about to read is said to be a copy of an original letter from the Prime Minister’s office. Or, at least, it is said that it has been in the Prime Minister’s office. It is written by W. E. Davies. I remind honorable members that the Prime Minister has said that he did not know Davies. That may be so; but there is somebody in the Prime Minister’s office who knows him.
– Davies says that he had a personal interview with the Prime Minister.
– I want honorable members to appreciate the true purport of the document which I am about to place before them. The matter, I assure them, is a serious one. This is a copy of an original letter from Davies to the Prime Minister- a letter., however, which has been altered by some one in the Prime Minister’s Department. The original, after it was altered, was returned; and here is a copy of it, as altered, tendered in this chamber as evidence. It is dated 30th December, 1920, and is addressed to “ The Right Honorable W. M. Hughes, P.C., K.C., Prime Minister of the Commonwealth of Australia. Melbourne.” Certain parts are typewritten, while other portions, which I shall read, are amended in hand-writing. And that hand- writing is said to be the hand-writing of the Secretary to the Prime Minister. The original will show whether, that allegation’ is true.
– Why not deal -with the original, rather than, quote from a copy?
– We desire to secure an inquiry ; and, so seriously do we view the subject-matter of the proposed investigation that’ we do not think we would be doing wrong if we were to ask the Government to indemnify any persons who may see fit to present evidence. It will be appreciated, from- the nature of this document written by Davies, that same form of indemnity against any further possible action may actually be necessary. The letter starts - .
I am in receipt of advice to-day from my principals, Messrs. Ben J. Lee, Batavia.
Now, the whole of those words so far have been struck out, and other words have been put in which, I repeat, are said to he in the handwriting of the secretary to the Prime Minister. The words which replace the deleted sentence are as follow^
I have just returned from Java, . where I inspected the shipping of the last orders placed by yon. The sugar position there is now distinctly favorable to Australia. To-day my principals in Java, Messrs. Ben J. Lee - “
Those, up to and including the last word, are the hand-written alterations. The typewritten letter proceeds, “they”; this is struck out, so as to make way forthe name of the principals,. “ Messrs.Ben J. Lee.” Then come- the typewritten words, “ advise me “ ; after which the words “ by cable “ are further written in. The typewriting proceeds - that owing to the collapse of the sugar mar- ket, due to the failure of several large speculators operating in Java, to-day’s pricea there have actually fallen, below Australian prices. It is indicated, however, that prices will harden immediately European finance adjusts itsel-f, and further, it is as yet impossible to estimate the attitude that will be adopted by Chinese speculators in 1921. They state, further, that with authority in hand to buy at a limit of £27 10s. per ton of 2,240 lbs., superior white Java sugar 25, f.o.b. Java ports, JanuaryFebruary, or earlier shipment, that; providing an irrevocable bank guarantee ifl’ immediately arranged, -they, can offer your Government up to 20,000 tons. This sugar is 1920 crop, and is packed in original sacks of 240 lbs. net; but packing’ can be arranged to suit Australian conditions’ at a small extra cost.
The next sentence - typed - begins -
It will be understood that it is impossible to make definite offers for more Mian a few hours’ duration.
That sentence has been’ amended, ‘ in the same handwriting, to read-
As will be understood, it is impossible to make definite offers for more . than a few hours’ duration. ,
And then the handwriting adds to the typewritten lines -
My principals strongly advise you to close.
The purport of that obviously is’ to make the letter a far more pressing one. The typewriting concludes -
Trusting that the above offer will receive your prompt consideration, I beg to remain
Yours faithfully, (Signed). W. E. Davies.
Then, right at the bottom of the letter, there aire additional words, said to have been written by the ‘Prime Minister’s secretary; and, in making these quotations and alleging that there is evidence of the work of a Government official upon this document, I say that’ I wish to (find no culprits in -the Public Service, but that, if they are there, they should fee exposed. I emphasize that the whole ^purport of the amendments in handwriting is to. makethe letter a_ far more forcible one. After the corrections and additions: had been made, the letter was sent hack to be rewritten. The officials of the Prime Minister’s Department will know whether or not the letter is there in its completed’ ‘ form. I was about to quote the added note, under an asterisk, at the bottom of the letteT. It is as follows: -
If yoii place an order now* you will get the lowest possible price; and: further reduce theaverage cost of your total - purchases.
Thus, it will ibe; perceived;, this letter is made infinitely more . pressing: It was Davies who forwarded it to the Prime Minister. I say, having- conducted’ a clerical office for more than twenty-five years, that the document indicates’ that the two - individuals -who conferred in respect of . the letter were ‘ friendly. This suspicion may ibo unfounded. I do not want to be abused, as my- Leader (Dr. Earle Page) was, for making suggestions of this kindj hut’ no honorable member, from the Prime Minister’ down, should take any exception’ to an- inquiry in a matter- about which there is such manifest evidence that something suspicious has been going on.
– As a member of the Public Accounts Committee you will have every opportunity of examining any witnesses in respect of that matter.
– For a start, Colonel Oldershaw is not here. This is a matter that should be dealt with promptly. The suspicion to which I refer seems to be strengthened by this communication, dated 29 th January, . 1921, from Mr. Davies, Java, to Mr. James Nash: -
Future policy of Government buying. I regret to say that Mr. Deane has now been drafted into another Department, which leaves Sugar Board now in control of all buying. .
With such information before them, surely honorable members will admit that this is a fit subject for prompt inquiry. In my opinion, it is well worth investigation on its own, apart altogether from such questions as the amount per week which the cane-sugar worker of Queensland should get, or what proportion of costs should be divided between the sugar mills, the refinery people, and the distributers. The full inquiry will be ‘a long one, whereas an inquiry into the question that has been raised this evening should be prompt, and could be expeditious. This is “the matter which the Country party endeavoured to bring before the House last week and the week before, but we were prevented from so doing. Wo are now taking extreme measures ibecause the Government last week took extreme measures to block us. The Government will save their skin best if they will immediately make the fullest inquiry publicly into this charge. I shall be very glad indeed if it is shown that there is nothing shady about the transaction, because I am not looking for “ mare’s nests,” as suggested by the Prime Minister. But I want this matter investigated, and I think sufficient evidence has been adduced to justify an immediate inquiry. If honorable members think otherwise, I should like to know how much smoke must appear in the sky . before they will admit that there is fixe.
.- -I would uo.t have risen to take <part in this debate were it not for the fact that, in my opinion, a very serious position has developed. The Government, in order to meet a public demand and a request from honorable members, recently remitted to the Public Accounts Committee for investigation and report the whole question of sugar control. That Committee therefore will have full power to investigate the question that has been raised by the honorable . member for Swan (Mr. Prowse). But that does not concern me. Just now I am concerned about the position of two members of that Committee who are charged to determine, in a judicial capacity, a matter that has been specially referred to that body. I refer, of course, to the honorable member for Robertson (Mr. Kerning) and the honorable member for Swan (Mr. Prowse). As members of the Public Accounts Committee, they have been requested by this House to investigate and report, at the earliest possible date, upon the whole question of sugar administration, but as members of this House they are committed to support the amendment to reduce the amount of Supply by £1 as an instruction to the Government to reduce the price of sugar forthwith to 5d. per pound. How can these honorable gentlemen continue the pretence of sitting as members of the Public Accounts Committee to inquire into the question of sugar control and determine the price at which it’ oan be sold? Their attitude will certainly damage the reputation of the Public Accounts Committee.
– Tien give us a Select Committee.
– By their support of the amendment now before this Committee, their hands are tied, because they are pledged to vote upon the issue before an investigation is made. They demand that the price -shall be reduced forthwith to 5d. per lb. As for the scope of the inquiry by the Public Accounts Committee it is, I think, only necessary for me to mention that the Committee will have authority to call witnesses from any of the Federal Departments and to require the production of any book, record, or original letter or any other document bearing upon the subject of the inquiry. The Committee will have full power to conduct the investigation. Therefore, the attitude of the honorable member for Robertson and the honorable member for Swan is cartainly very extraordinary.
.- The amendment before the Committee is the third adverse motion on the administration of the Government with regard to sugar control during the last fortnight. I supported the first, submitted by the Leader of the Opposition (Mr. Charlton), and as I did not then have an opportunity of stating my reasons, owing to my absence through illness until the day when the vote was taken, I may now inform honorable members that I voted for the amendment as’ a protest, because information which this House had asked for regarding the sugar transactions was not forthcoming at the time. Since then the information asked for has, in the main, been supplied, or at all events sufficient has been said to justify the Ministerial assurance that the price of sugar, at the present time, cannot be reduced below 5d. As the whole question has been submitted to the Public Accounts Committee for inquiry and report, I do not feel justified now in supporting any further motion of want of confidence in the Administration until the position has been inquired into. The statement made this evening by the Leader of the Country party (Dr. Earle Page) does not reflect in any way upon the Administration. The Government have not had anything to do with the transactions between Davies and Lee, and I think the Minister for Trade and Customs (Mr. Rodgers) is quite justified in the view that if any inquiry is necessary, surely it may safely be intrusted to the Public Accounts Committee. It is generally admitted that the question of the price of sugar has nothing to do with the question of control. The debate has certainly been very illuminating from the view-point of future control in the industry, and for that reason the time occupied may not have been wasted. I believe that the majority of those who so severely criticised the Government over this matter favour the principle of Government control, but I have no hesitation in saying that I quite disapprove of it, and I hope that this is the last we shall hear of Government control of sugar or any other industry, at all events in peace time. If we have Government control, even of a few of the more important industries in the Commonwealth, there is not the least doubt that 365 days in the year will not be sufficient for honorable members to deal with the administration and criticise the Government. We want to get away from Government control of industry, and give our attention to those questions that properly concern the functions of government. Many honorable members favour Government control of industries, and when the agreement was before the House, members generally held .that it waa a very fine agreement indeed. All parties were satisfied. If all parties engaged in the industry are satisfied they must be doing very well. I am confident that those who have had to pay the high price ruling for sugar during the term of the latest agreement - that is to say, since I have been a member of this House - are not so well pleased. Many of them do not have the fine times that are enjoyed by those engaged in the sugar industry. They do not obtain the same good wages, although their working conditions are quite as hard, and, in many cases, even more trying, than those of the men associated with the sugar industry. To do justice to workers and producers alike, then, it would seem that we must control every industry and trade, and endeavour to strike a balance. We all know, however, that there is no possibility of such a thingbeing done by this or any other Parliament in the Commonwealth. The honorable member for Barrier (Mr. Considine) interjects. He, no doubt, would nationalize every industry. What we have learnt during this debate should cause any one likely to follow his lead, to hesitate and consider what we would be up against if we were to nationalize only some six of the principal industries of Australia.
I do not think it necessary to apologize to any one for the vote I gave in support of the motion moved recently by the Leader of the Opposition (Mr. Charlton)’ to reduce the price of sugar to *Jd. per lb. The reasons I have given are sufficient to justify that vote. I had not at my disposal, at the time, the information necessary to guide me in determining whether or not sugar could be sold below the present price, and I supported the motion as a protest against the failure to supply such information. I admit, as a supporter of the Government, at the present time, that that motion did some good. But for it and the support that certain honorable members sitting b(-hind the Government gave to it, I am afraid we should not have had supplied to us so quickly, and so completely, the information that is now before us. The position to-day, however, is quite different. There is no justification for the submission of motions of want of confidence, day after day, in regard to the sugar question, seeing that it has been thoroughly threshed out, so far as it is possible for the House itself, to. deal with it. The whole question is now in the hands of the Public Accounts Committee. I have no doubt that that Committee will inquire fully into it, and that its report will be accepted with confidence by the House, despite the fact that two of its members have felt justified in criticising the Administration. The fact that they have done so, to my mind, is immaterial. If, because of that criticism, we should debar them from helping the Committee to render a conscientious report, there would be no justification whatever for referring the question to the Committee. We know perfectly well that some members of the Public Accounts Committee will be biased against the present Administration from the very start of the inquiry, inasmuch as the Committee represents all parties in this Parliament.
During the debate the Minister for Trade and Customs (Mr. Rodgers) told us that there was too much politics mixed up with this question of business. If we are to, have Government control of, and Government interference in, business, I do not know how we can escape from that sort of thing. If politicians interfere with business, we are bound to have politics in connexion with it. The only course open to us is to leave businesses of this kind to those who understand and can control them. Despite the huge profits that certain people have made out of various enterprises, I think that, in the long run, the product of an industry would be retailed very much cheaper under private enterprise than it would be under Government control no matter by whom that industry was administered. I hope that we shall now get away from this debate. We are anxious to deal with other, matters that come within the proper functions of government, and in which the people outside are deeply concerned. I hope that we shall proceed at once to consider them, leaving this sugar question to the Public Accounts Committee, which I am sure is in a position ‘to deal with it more satisfactorily than we could hope to do, as the result of any debate that might take place in the House.
.- It is becoming abundantly clear that the Government is to be saved again.
– A good many members of the Opposition will thank God for that.
– I do not know whether they will or not, but it is clear that the honorable member for Kalgoorlie (Mr. Foley) will do so. He will render thanks to the Deity for allowing him to remain in the position in which it has pleased Him to place him. I rose, however, not to deal with the honorable member for Kalgoorlie, but to discuss this lady-like attack that has been made upon the Government by the Country party.
– Does the honorable member think that it is a sort of lover’s quarrel ?
– No; I think the attack which has been levelled at the Government has been remarkable, not for what has been said, but for the delicate and gingerly way in which the whole subject has been handled.
– What kind of attack is the honorable member going to make?
– The sort that ithe honorable member will appreciate. It has appeared to me while listening to the debate that those honorable members who have launched this attack upon the Government have in their possession material in the handling of which they are particularly careful. We have, in the first place, an undoubted insinuation of malpractice or of corruption in connexion with the sugar control.
– Of leakage.
– We know that there has been a leakage of £2,500.
– Not out of Government funds. ‘
– At any rate, the money came out of sugar. The departmental files show that Mr. Davies, whose partner, Mr. Lee, received £2,000 for shutting his mouth, and handing over certain documents and other things in connexion with this business, was in direct communication with the Prime Minister’s secretary. The honorable member for Swan (Mr. Prowse) has declared that an original letter sent in by this gentleman to the Prime Minister’s Department was returned to him with notes in the handwriting of the secretary to the Prime
Minister. That was the honorable member’s statement.
– There is no evidence in support of it.
– The honorable member for Swan says that he has the original letter.
– But he will not produce it.
– A charge of corruption is advanced, no matter how much the honorable member, and others who support the Government,, when these charges are either insinuated or made direct, may try to cover it up.
– They will not make such a charge.
– We ask for a Select Committee.
– The exPostmasterGeneral (Mr. Wise) is quite content to rely on the forbearance tff his political enemies rather than clear . his character.
– Let them make the charge, and we will clear ourselves.
– The statement has been made by two honorable members of the Country party that they have the original documents. Surely that can be tested.
– It is the bounden duty of the honorable member for Swan (Mr. Prowse),, if he has an original document, and if he is discharging his duty to this country, to produce it to the Committee, of which he is a member.
– The honorable member for Swan held up a certain document, and he quoted from a copy of another document, the original of which he said he had.
– And he has a duty to perform.
– I say that the original is in existence, and will be presented in evidence by the person who has it.
– The honorable member vouches for the fact that the original is in existence. Presumably, therefore, he has seen it. If he vouches for its existence, I accept his word that such a document does exist. Such a statement having been made on the floor of the House, the duty of any selfrespecting Ministry is to challenge the honorable member to- produce his document to a Select Committee.
– Let him produce the documents in this House, where he made his statement.
– I do not take that view. If the statements which have been made concerning Ministers had been made concerning me, I would challenge the utmost investigation. The Government may try, ostrich-like, to hide their faces thinking that they cannot be seen; they may think, perhaps, that by refusing an investigation by a Select Committee or a. judicial tribunal, the public outside will pay no attention to these charges; but the reputation of the Government is such that the public will believe the statements that have been made. “
– A Select Committee is inquiring into these matters.
– And the man who makes the charges is a member of the Committee.
– Yes, and he has a duty to perform.
– I do not know that the Government can draw any comfort from the fact that a member «who is toi be one of the judges is acting at the present time as prosecutor.
– If his statement be correct that the people whom he mentions are “ crooks,” he is briefed by “ crooks.”
– The Minister can draw no comfort from accusing honorable members who bring forward these charges of being associated with “ crooks.”
– I said that, if their statement is correct they are associated with “crooks.”
– If the Minister’s statement is correct, the Cabinet to which he belongs has been associated with “ crooks.”
– We have not.
– There is evidence in the letter in the handwriting of the Prime Minister’s private secretary.
– There is nothing before this Committee.
– I do not know why, when endeavouring to elucidate the attack made by honorable members in the corner, I should be subjected to so much interruption, especially as I listened so attentively to the honorable members who made the allegations. If the evidence that honorable members claim to have concerning the sugar transactions had been in my possession, I would have founded some charges upon it. I am not satisfied now that I have not got such evidence. I want something further to be done. If any inducement has been offered to either Ministers or officials under the control of Ministers, to facilitate contracts for the supply of sugar or other goods, if improper or undue influence was used, every member of the House, and the public, should know the facts, but sufficient has been said to warrant an inquiry by a special committee or tribunal.
– Will the honorable members in theCorner appear as prosecutors to lay the charges?
– There is an easy way out for the Government. Let them appoint a Judge of the High Court, or aCommittee to investigate the- whole of the transactions in regard to sugar. If the Government have a clear conscience in this matter, if they are sure that there is no foundation for these allegations, surely it will be of benefit to them and to the Nationalist party to expose this “mare’s nest” to the public. But I say that it is not a “ mare’s nest.” The evidence I have hearrd contains some very serious allegations.
– And they will become more serious the more they are investigated.
– My regret, is that the Leader of the Country party, and his colleagues, were so considerate of the susceptibilities of the people whom they were attacking that they damaged their own case.
– They were afraid of the information they had.
– It has become abundantly clear in the course of the debate that the forecast by the daily press, that the Government are safe, will prove to be correct. The whip has been cracked, and I expected the honorable member for Darwin (Mr. Bell) to finish his address by quoting something akin to “solidarity.” The honorable member is reported in the press to be the only Nationalist member who refused to give to the Government a pledge of continued allegiance and support, but whilst he voted for the price of sugar to be reduced to 4½d. per lb., he has this evening pointed out how impossible it is, in the light of information that has been given, to vote for a reduction to 5d. I do not know what influence has been brought to bear upon him - whether it was the Nationalist Council or the all-powerful Colonial Sugar Refining Company. We have heard a good deal of talk about Government control of sugar; since this debate started, however, I nave heard nothing further of that, but I have heard a devil of a lot of control of the Government by the Colonial Sugar Refining Company. All the correspondence and all the speeches that have been made in defence of the Government on this question have gone to show that the Government did not dare to make a step in any direction connected with sugar until its proposals had been approved of, and permission had been granted to it by the Colonial Sugar Refining Company. It is a good business Government, and as in sugar, so in steel and everything else.
– Did the honorable gentleman say steal - s-t-e-a-1 ?
– Steel or stealthey both go together. The honorable member is not so unsophisticated that he does not know that this is a “ business” Government, and that it carries on the business of the country in the interests of “business” - “ big business.” Instead of “Government control” we get “ business control.” Departments are carried on in the interests of “ business.” The Public Accounts Committee has been appointed to go through the accounts in connexion with sugar, and the Government has whipped up its members. There , are not too many Country party members present. We have been reading in the press lately that the Country party has been complaining about the manipulation of some of its members; but no reference has been made by the Leader of that party (Dr. Earle Page), or by other members of the Country party, to the allegations that certain members who have been mentioned in the press are safe for the Government.
– It is not fair for the honorable member for Dampier (Mr. Gregory) to brinsf him into this.
– I did not mention his name, and, as a matter of fact, I did not have him in mind. It is not part of my practice to reflect upon men who are not able to defend themselves. The members of the Country party to- whom I refer are, to the best of my belief, enjoying the best of health, but they are not here to-night. There are two of them who have been mentioned as being safe for the Government to rely upon. It is no use for the Leader of the Country party, or the Deputy Leader (Mr. Fleming) to stand up and assail the Government for making unfounded attacks upon their members, or refusing the courtesies usually shown to one another in these political fights, while they are countenancing in their own party the membership of men who are not present, and upon whom the public press say the Government is quite safe to rely.
– They are sensible men, anyway.
– I can appreciate the Honorary Minister’s point of view. The debate having gone so far it is quite patent to everybody, as it should be to the public, that the Government have not been in, danger, and are not now in danger, and that we might as well have a division and get on with something else.
. -More than once I have heard it suggested in the course of the discussion of the sugar question that the reason for desiring to put the inquiry into the hands of a Select Committee, instead of the Public Accounts Committee, was that a Select Committee could deal with the matter much more expeditiously. By direction of my Committee I asked the Government this morning to submit to the House a motion which, if carried, will enable the Public Accounts Committee to do the work quite as quickly, if not more quickly, than any Select Committee. The object of the motion is to enable the Committee to sit on days when the House is ordinarily sitting.
– If the House will give leave the motion will be moved to-night.
– I hope that will be done. The Public Accounts Committee has appointed a meeting for to-morrow, and unless permission is given we cannot sit. If the desired permission is conceded, as it was conceded in regard to an urgent inquiry on a previous occasion, I think I can promise that the Committee will complete its investigation as quickly as any other Committee of the House could.
I would like to say that, while members of the Committee are also members of this House, and that while they are adherents of one or other of the political parties, they nevertheless generally take the view, which I have always held and endeavoured to act upon, that they should leave their politics outside when they enter the Committee room. That is the only way in which the Committee can carry out its duties as an inquisitorial body, and exercise to the full its powers in connexion with public accounts. It has nothing but a great and most earnest desire to arrive at the truth on the evidence submitted.
.- It is a very great pity indeed that such matter has been brought into this debate as was introduced by the Leader of the Country party (Dr. Earle Page). I agree with those who say that if he had a charge to make against members of the Government, or against anybody connected with sugar control, he should have made a definite and distinct charge. I am quite sure that every member of the House found it most difficult to follow him in his reading of what purported to be a statutory declaration. It was not, by the way, a statutory declaration. That was the extraordinary part of it. He informed us that he had a statutory declaration in his possession, but instead of reading it he gave us a summary of it. That was a most unheard of proceeding, and I confess that I, for one, found it most difficult to follow. I do not know now, and I question whether any member of the House knows, what significance even the honorable member himself attaches to that so-called statutory declaration. He says that it ought to be submitted to a serious investigation, and that insinuations have been made which ought to be investigated by a, Select Committee. I believe that no Select Committee ought to be appointed at any time to inquire into anything until a definite charge has been made. There is nothing to prevent the honorable member for Cowper (Dr. Earle Page), the honorable member for Swan (Mr. Prowse), and the honorable member for Robertson (Mr. Fleming) constituting themselves a Select Committee and making further inquiries into those matters in regard to which they have been making insinuations, and when they have satisfied themselves that the allegations are well founded, let them come into the House and make their charge, when it will be time enough for us to investigate it.
I think it necessary, in a very few words, to make my position clear in regard to the amendment. There seems to be an extraordinary idea obtaining amongst members, and especially those who belong to the Opposition, regarding the character of the Nationalist party meetings. They seem to regard the room in which we meet upstairs as a kind of torture chamber. It has been suggested that upstairs the cane is used, and one honorable member, I think, in the corner, suggested that in some mysterious way the “ acid “ is applied. I am quite sure there are many honorable memibers in the ranks of the official Opposition who believe that the thumb-screw and the rack are also brought into requisition, in order to discipline members into subservience to the Government. It seems that honorable members opposite reason that because members on the Nationalist side are found voting solidly, that must be the result of the application of some form of torture. It is a most extraordinary circumstance - one I have noticed since I came into this House - that on almost every occasion when a division is taken members of the official Opposition vote with absolute solidity. One can only conclude that this wonderful unanimity, wonderful unity, and wonderful solidarity are the result of considerable external pressure.-
– That is not so.
– I am quite sure the honorable member for Yarra (Mr. Scullin) will not be found voting against his party on any occasion; he has not sufficient independence to do so - he dare not. Independence on the Opposition side is impossible, and that is why we do not find it. Some of us on this side are being accused by the official Opposition of voting with the Government because the Government whip has been cracked. At another time I have been taunted by the Opposition with voting in a certain way . because it has been dictated by the press outside. Which way are the Opposition going to have it this time? The press outside is denouncing me for supporting the Government. Are the mem bers of the Opposition going to say that I am supporting the Government in defiance of the press because of the crack of the Government whip? I do not care a snap of the fingers what the press says outside in regard to my actions; and I do not care a snap of the fingers for the crack of the Government whip. I record my vote as my reason and my conscience dictate. I voted for the Government the other night only because I was convinced that they had done what they promised.
I desire to state clearly, in a word or two, my position in regard to this question of the price of sugar. Before I do so, let me say that, when this Sugar Agreement was brought down to the House, in 1920, by the Prime Minister, there was not a dissentient voice in any part of the Chamber. We were told that it was a good agreement.
– We are not denouncing the agreement now.
– Letus assume, then, that the agreement ratified by the House in 1920 was a wise agreement, as it was then characterized by the honorable member for Swan (Mr. Prowse). The House was told at that time, March, 1920, that the necessity for making foreign purchases of sugar would mean the raising of the retail price to 6d. per lb.
– The price was then 6d.
– The price was raised in 1920 to 6d., after the ratification of the agreement. ^
– No, before.
– I do not think so. I am now told by the honorable member for Cowper (Dr. Earle Page) that the price was raised three months before the agreement was ratified. The Prime Minister’s speech,- in which he foreshadowed the raising of the price to 6d., was delivered on the 25th March, 1920-
– The honorable member, I think, is wrong. In March, 1920, the late Leader of the Labour party (Mr. Tudor) moved the adjournment of the House for the purpose of ascertaining whether the Government would be prepared to reduce the price from 6d.
– I still believe I am right. In any case, I believe that, in March, the Prime Minister said the price would have to be 6d., and the reason was the purchase of foreign sugar at a high figure.
– It was on 25th March that the price was raised to 6d.
– Then, my memory is correct, after all. I remind the Committee that, although there is so much fuss being made to-day because the Government have not brought down seasonal or annual balance-sheets from the time the sugar came under control in 1915, there was not, when the agreement was being discussed, any suggestion on the part of any member that the Government had been disregardful of its duty in this matter. If I remember rightly, there was no such demand even made by the press as that there should be such balancesheets. We had from time to time the half-yearly and yearly reports ‘of the Auditor-General, who went into the accounts of the sugar refiners as they affected the Government transactions. I repeat that, at the beginning of 1920, there was not a single demand from any part of this Chamber such as is being made now. When the agreement came into operation there was practical unanimity with regard to the past sugar control. The sugar agreement began in 1920, and tho price was fixed at Gd., and we were given to understand that part of the price of 6d. was to go to liquidate the shortage on the foreign purchases. Next the people began to be restive at the length of time they were called upon to pay 6d. per lb. We heard all kinds of rumours as to where the money was going. It was suggested in various quarters that the Government were making large sums out of the control.
– It was suggested that the Government were making millions, and using them for ordinary governmental purposes. When nine months ago I wished to check the Government control, and to find out whether it was possible to make a reduction in the price, I applied to the Government for information. I have been trying during those nine months to get information from the Government to enable me to make up my mind as to whether a reduction in the retail price is possible. “I failed, and it is only now that I am beginning to understand how it was that the Government were unable to supply me with the necessary information. The Minister for Trade and Customs (Mr.
Rodgers) himself has told us that it was only when he began to look into the mat ter and when the demand came for annual balance-sheets that he saw what a colossal task was involved. He was anxious not to give fragmentary information, but he desired to wait until he had the whole of the particulars before him. Therefore, quite recently I, in common with other honorable members, was exceedingly anxious that the retail price should be reduced; but the Sugar Agreement of 1920 is still in existence. We have undertaken certain obligations under that, agreement. I saw that under it the price could not be reduced.
– I find from Hansard that on the 30th March, 1920, Mr. Tudor moved for a reduction. At that time the Prime Minister said there would be a £220,000 deficit. . From that time onwards there has been no information, and what we have been in difficulty about is to know why we should be charged 6d. when there was only £220,000 owing then.
– I frankly admit that I think the Government have been greatly to blame for not having placed at hand all the information at their disposal, because it put many honorable members in a false: position. When I failed to get the information from the Government, I took it on myself to go on the public platform, and state quite clearly that I was absolutely opposed to any renewal of the agreement, but that I had not sufficient information before me then to enable me to say whether, under the conditions still prevailing, it was possible to reduce the price below 6d., because I recognised that until the deficit, whatever it was, was wiped out, a reduction in price was impossible. When the Government did come down with some information it was of a meagre character. From the first statement we got I could not make up my mind as to whether there was a possibility of reducing the price below 6d. When the Leader of the Opposition (Mr. Charlton) moved for a reduction to 4£d. per lb., I voted for it, not because I believed that under present conditions sugar could be retailed at 4£d., but as a protest against the failure of the Government to supply the necessary information.
– And later they fooled you. again.
– Later they came down with the information that has satisfied me that, under the agreement as it at present exists, we must pay at least 5d. The next point is as to when we can reduce the price from 6d. to 5d., and that is where the trouble lies. We were told, in the first statement of the Minister (Mr. Rodgers), that the deficit at the end of June was £255,000. Not a word was said then about an amount of £415,000. Therefore, we ought to reduce the price to 5d. when that £255,000 has been liquidated, whenever that may be. That is for the Public Accounts Committee to ascertain.
– By the time we get their report, the public will have paid more than is necessary.
– I fail to see why the sugar account should be saddled with that £415,000 in addition to the £255,000. The Government having made that profit, and passed it into the Consolidated Revenue, why should the consumers be called upon to pay that £415,000 over again?
– During that period we have been borrowing money from the Treasury to purchase sugar abroad, while the Government have had £415,000 belonging to the people, and we have been paying interest all the time.
– That is a matter for adjustment.
I wish to make my position perfectly clear. As a supporter of the Government) I have not been satisfied with the way the Government have treated the House. I am pleased that we have as much information as has now been placed before us. I do not think that there is a shadow of corruption in the whole business, no matter what insinuations may be made. So far as the Government and their servants are concerned, I believe that everything has been perfectly open and above board. Up to 1920 the sugar control was a splendid thing for Australia. Under the conditions existing in 1919-20, regulation of the industry was necessary in the interests of the Commonwealth, and I believe -that, on the whole, the public got sugar at a reasonable price, when, probably, had there been no such control, they would have had to pay a great deal more. Boiled down to one point the question is, How much of the deficit has still to be liquidated? We know the profit the Government are making, and having ascertained the other fact we shall know to a day how long it will take to pay off the deficit. I have no doubt that the Committee will carry out its work expeditiously, and will be able, within a few days, probably, to give the House a distinct statement that, having regard to all the facts, the public can be relieved to the extent of Id., which reduction can last until the agreement expires, and then the whole question can be re-opened for the consideration of the House.
– I rise, as Government Whip, to contradict two statements made by the Leader of the Country party (Dr. Earle Page) and repeated in this debate by the Deputy Leader of the Country party (Mr. Fleming). One was that the Country party had been refused a pair for. a sick member, and that in consequence the honorable member in question had to be brought from a sick-bed to record his vote in the House. That statement was utterly inaccurate. The honorable member for Parkes (Mr. Marr), who negotiated the matter with the honorable member for Corangamite (Mr. Gibson), assures me that he offered to pair the Attorney-General (Mr. Groom) with the honorable (member for Wimmera (Mr. Stewart) for the division on the day in question, and that the offer was not accepted by the honorable member for Corangamite. He tells me, further, that when the Attorney-General arrived, complaint was made that the honorable member for Wimmera had been compelled to come to the House and vote, but if that was the case, it was entirely the fault of the Country party. The second inaccurate statement was that referring to the pairing of the honorable member for Dampier (Mr. Gregory). As long ago as last March I had the authority of tie honorable member to pair him in favour of the Government on any no-confidence or censure motion submitted by the Leader of th» Opposition, and that authority was indorsed by him between noon and 1 o’clock to-day, when I in- terviewed him, and he admitted that he had authorized me to pair him in the manner I have indicated. In the circumstances, both statements made by the
Leader of the Country party and indorsed by his deputy leader were, to put it mildly, entirely inaccurate.
– Yesterday afternoon the son of the honorable member for Dampier (Mr. Gregory) informed me that he had written to the press a letter that appeared yesterday stating that the honorable member had been paired on the motion last week without his knowledge or consent. .
Question - That the sum proposed to be reduced be so reduced (Dr. Earle Page’s amendment) - put. The Committee divided.
Majority … … 3
Question so resolved in the negative.
– In order that the Committee may have the opportunity of expressing its disapproval of the Government’s action in referring the Kidman-Mayoh claim to arbitration after the finding of the Public Works Committee had been received, I move -
That the sum be reduced by 10s.
Question - put. The Committee divided.
Majority . . ‘ . . 9
Question so resolved in the negative.
Original question resolved in the affirmative.
Resolution reported. Standing Orders suspended, and resolution adopted.
In Committee of Ways and Means:
Motion (by Mr. Bruce) proposed -
That towards making good the Supply granted to His Majesty for the services of the year 1922-23, there be granted out of the Consolidated Revenue Fund a sum not exceeding £1,763,026.
.- I have received a telegram from the Northern Territory in which it is stated that the Superintendent of Railways has reemployed a man who was once convicted and twice dismissed from the Government service for dishonest practices. It is also stated that this person has been given the keys of railway offices, and that he has been connected with strike-breaking. He also desires to know on whose authority coloured labour ia being recruited, and if the Government have changed their policy with regard to preference to returned soldiers, and are now giving preference to coloured men. The communication concludes, “ Wire sent Commissioner not delivered.” Those particulars have been sent to me by telegram,’ and I have been requested to place them before the House. I do not expect a reply at this juncture, but I shall bo glad if the Government will give the matter early attention, and give me a reply, say, to-morrow.
– I desire to make a personal explanation. I understand that during my absence from the chamber the Government Whip (Mr. Story) made an explanation concerning a pair with the honorable member for Wimmera (Mr. Stewart). I desire to say that I endeavoured to arrange with the honorable member for Parkes (Mr. Marr), a pair for the honorable member for Wimmera, and it was refused.
Question resolved in the affirmative.
Resolution reported and adopted.
That Mr. Bruce and Mr. Greene do prepare and bring in a Bill to carry out the foregoing resolution.
Bill presented by Mr. Bruce, and passed through all its. stages without amendment or debate.
That the House do now adjourn.
I suggest that, as it is the intention of the Treasurer (Mr. Bruce) to deliver his Budget statement to-morrow, an arrangement might be made - or an understanding arrived at - by which my colleague may be permitted to speak immediately upon the meeting of the House; but that the time which he will occupy shall be added to the period ordinarily available to honorable members for the discussion of private business.
– I have no objection, personally, to that course.
Question resolved in the affirmative.
House adjourned at 11.11 p.m.
Cite as: Australia, House of Representatives, Debates, 16 August 1922, viewed 22 October 2017, <http://historichansard.net/hofreps/1922/19220816_reps_8_100/>.