10th Parliament · 1st Session
Mr. Speaker (Hon. Sir Littleton Groom) took the chair at 11 a.m., and read prayers.
– The Federal Capital Commission having decided tocontinue to operate the. bus services in the city, does it intend to prohibit the private bus services now in operation between Canberra and Queanbeyan?
– No. The Commission’s operations will be confined to the traffic within the city area.
– The Herald, of Melbourne, published yesterday this telegram from Washington -
The United States Shipping Board, in its annual report, makes a bitter reference to what is described as another illustration of the co-operation between members of the British Empire for their own good.”
The complaint is against the decision of the Australian Tariff Board favouring the Canadian-Australian Steamship Line by the rule requiring that the cost of transport from the point of origin to the port of export must be added to the value of the goods imported in determining the Australian import duty. 1 am not averse from that kind of cooperation, but I ask the Minister to inform the House what are the regulations which tend to help the trade of the British Empire as against that of the United States of America?
– For the decision of which complaint is made in America the Tariff Board is not responsible; it is a matter of departmental administration in the assessment of values for duty purposes. As the matter is somewhat complicated I ask the honorable member to put his question on the notice paper.
The following papers were pre sented : -
New Guinea Act, ordinances of 1927 ; No. 33, Town boundaries; No. 34, Supply (No. 3), 1927-28; No. 35, Germans admission.
– Is the Miniater for Home and Territories aware that the Scriptures are being invoked in derogation of the Federal Capital? The fact has come under my notice that an inquiry addressed from Melbourne to a public servant in Canberra aB to what he thought of the Federal Capital was answered by the inquirer being referred to the Bible - Nahum, chapter 3, verse . 1. Upon consulting the Bible I find the reference is to these words - “ Woe to the bloody city, it is all full of lies and robbery.” Will the Minister take prompt steps to correct that statement, or at least point out that it is greatly exaggerated?
– As the matter requires some consideration I ask the honorable member to give notice of the question.
Suspension of Coastal Provisions
– Will the Prime Minister say whether any steps have been taken to give effect to the request of Western Australian members for a partial suspension of the coastal provisions of the Navigation Act?
– The honorable member will recollect that I said that I could not accede to the request for the suspension of the coastal provisions of the Navigation Act on the general and uncorroborated statements then made to me, but that enquiries would be made into the alleged lack of facilities for the transport of commodities from Western Australia to the eastern States. The inquiry is being made by the Navigation branch.
– Has the Minister for Markets and Migration noticed that the High Commissioner in London has stated in a speech that the Australian beef exporters are fighting against great difficulties owing to the competition of chilled beef from the Argentine. As experiments have been made in sending chilled beef from Australia to the United Kingdom, will the Minister state what success has been achieved, and if the experiments are being continued?
– My attention has not been drawn to those remarks of the High Commissioner. I am awaiting a (report from Mr. Ross Grant, the Commonwealth veterinary officer in London, as to the condition in which the last shipment of chilled beef arrived there. On receipt of that report I shall be glad to acquaint the honorable member of its contents.
asked the Minister for
Home and Territories, 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.£ 30,001 15s. 7d. on cotton yarn;: £7,037 12s. 8d. on seed cotton.
asked the Minister for Home and Territories, upon notice -
What precautions are being adopted to safeguard the aborigines during the construction of the north-south railway?
– The following measures have been taken in North Australia to protect aborigines during the construction of the north-south railway : -
Railway construction has not yet commenced in Central Australia, but the Government Resident has been instructed to arrange, at thu appropriate time, for action similar to that taken in North Australia.
asked the Minister repre senting the Minister for Defence, upon notice -
What are the aerial routes on which the proposed increased grant to civil aviation will be spent; and what is the estimated amount to he spent on each route?
– The establishment of the following additional aerial routes is proposed : -
The estimated amount to be spent on carli route is not yet available.
asked the Minister for Markets and Migration, upon notice -
– The request of the deputation referred to, that the inspection of fresh fruits intended for export should be placed under the control of a State officer vested with Federal powers instead of under a Commonwealth officer as at present, is being considered. Should any alterations in the present system be found necessary, they will be brought into operation in connexion with this season’s export crop.
Investments of Administrative Officers - Free Rail Tickets fob Public Servants - Motor Registration.
asked the Minister for Home and Territories, upon notice -
– The answers to the honorable member’s questions are as follow : -
Commonwealth Public Service provides as follows: - “(2) Nothing herein contained shall be deemed to prevent an officer from becoming a member or shareholder only of any incorporated company, or of any company or society of persons registered under any act in any State or elsewhere but an officer shall not take any part in the conduct of the business of the company or society otherwise than by the exercise of his right to vote as a member or shareholder.”
No investment by a member of the staff of the Federal Capital Commission which has come under my notice is of a nature that conflicts with the spirit of the sub-section quoted. 2 and 3. See answer to No. 1.
asked the Prime Minister, upon notice -
With reference to the question of the - honorable member for Bourke on 15th November last, regarding public servants in Canberra who wish to visit the capital cities once a year, will he give an indication as to his decision in the matter?
– After fullest consideration, the Government has decided that to grant rail tickets to public servants and their families living at Canberra to enable them to visit one of the capital cities at least once a year would be unfair to other members of. the Civil Service. It would be difficult to distinguish between the claims of civil servants transferred to Canberra and those officers whose duties compel them to transfer to other places in the Commonwealth. In the circumstances the Government is unable to accede to the request.
asked the Minister for Home and Territories, upon, notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister for Home and Territories, upon notice -
Whether he can supply any further information regarding the operations of the Roma Oil Company, as a result of the recent visit of Dr. Woolnough?
– Dr.Woolnough advises me that petroliferous gas in large volumes and under controlled conditions is flowing from the bore. It is accompanied by small quantities of light naturally filtered oil, and by relatively large volumes of salt water. Ali these indications suggest a distinct probability of the existence of an oil pool in Ger tral Queensland. Such a pool may be below the known gas sand, or may lie at some distance laterally. Much more prospecting is necessary before a producing well can be hoped for. Extended geological investigations and a drilling programme will be commenced immediately.
asked the Minister for
Trade and Customs, upon notice -
– The information is being obtained.
asked the Prime Min ister, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the PostmasterGeneral, upon notice -
Whathas been the yearly increase in listener’s licences since the date of the original agreement with Amalgamated Wireless (Australasia) Limited in March, 1922, and what is the present total as compared with the total at the date mentioned?
– The information desired by the honorable memher is as follow : -
March, 1922 - No listener’s licences issued.
March, 1923 - No listener’s licences issued.
December, 1927 - 257,010
– On the 30th November the honorable member for Reid (Mr. Coleman) asked the following questions : -
I am now able to furnish the honorable member with the following information : -
– I have from time to time been asked questions with regard to the recent industrial trouble. I have ascertained this morning that work has been resumed in Sydney. I understand that it has also been resumed in Melbourne, and that instructions were issued at 7 o’clock this morning that work should be resumed at all ports, and that employment should be offered.
Motion (by Dr. Earle Page) agreed to -
That he have leave to bring in a bill for an act to amend the Land Tax Act 1910-1922.
Bill presented by Dr. Earle Page and . read a first time.
In Committee: (Consideration resumed from 7th December, (vide page 2823) -
Clause 17 - 44l. - (1) Where a taxpayer has, in accordance with the last preceding section, requested the commissioner to refer a decision to a valuation board, the commissioner shall, if the taxpayer’s request is accompanied by a deposit of such amount as is prescribed for the particular class of case, refer the decision to the board not later than thirty days after receipt of the request.
.- I hope the Treasurer will make it unnecessary for me to move an amendment to the proposed new section 44l (1). That section states : - - 44l. - (1) Where a taxpayer has, in accordance with the last preceding section, requested the commissioner to refer a decision to a valuation board, the commissioner shall, if the taxpayer’s request is accompanied by a deposit of such amount as is prescribed for the particular class of case, refer the decision to the board not later than thirty days after receipt of the request.
I ask the Treasurer that he should not insist that every aggrieved taxpayer must lodge a deposit. This is a new departure, and it will have the effect of preventing many taxpayers from going on with their appeals. It will also put the department to a good deal of trouble in refunding deposits. I suggest that the situation could be met quite well by the provision which deals with frivolous appeals. The board might be empowered to make a charge covering the cost of the appeal, or impose some penalty for frivolous appeals. Probably not one appeal in a hundred, or even in five hundred, can be regarded as frivolous, and it is making the machinery too heavy to insist on a deposit accompanying each appeal. If the Treasurer will favorably consider my suggestion, it will save me the trouble of moving an amendment.
– The position created here is exactly the same as exists in regard to appeals to the Income Tax Board of Review. That provision has been, found to be satisfactory, and absolutely necessary for the proper working of the department. The Government has no intention of making a distinction between the working of the two acts.
– I have been urged to enter an objection to this proposal. In New South Wales, where the. system has been in operation for many years, there is no such thing as having to lodge a deposit. The board there has power to impose any costs it thinks fit. It seems hard that a person who wishes to object to an assessment should have to lodge, a deposit. The board has full power to impose such penalties as it thinks fit if it regards any appeal as frivolous. It can de’al with the matter either by inflicting a fine or by imposing costs. I cannot see, however, why a taxpayer should have to put up a deposit. It seems to me to be one-sided. The department has to be protected always; the taxpayer never. I had certainly intended to move for the omission of this provision in the Income Tax Assessment Bill, and I believe that it should be omitted from this measure.
.- I suppose the lodging of a deposit is insisted upon to prevent frivolous .appeals. One can imagine that the average taxpayer, if he thought he had any hope at all of obtaining a reduction in his assessment, would readily enter an appeal, and these appeals would become very numerous. I should like to ask the Treasurer what the amount of the deposit is likely to be. Perhaps he can inform us what amount is likely to be fixed under the regulations. I can understand that the department would be flooded with appeals if no deposit were required..
– But protection is afforded against that by sub-section 5.
– I think. the deposit is preferable. The taxpayer knows what the amount of the deposit will be, but he does not know what penalties he may be subjected to.
– I think that every taxpayer should have the right to appeal against his assessment if he thinks it unjust, and I hope the Treasurer will see his way to delete this provision. I think an injustice may be done, because people may demur about making a deposit. They would rather bear the taxation than take the risk of losing a deposit.
.- I wish to ask the Treasurer under what circumstances the deposit would be refunded? Would the department make a refund if a man’s case seemed fairly sound, but the decision went against him ?
– Proposed new subsection 5 provides that the board may, if it considers the appeals to be frivolous or unreasonable, order the forfeiture of the whole or part of the amount deposited. This reasonable provision is to be found in other acts. Recently an appellant was required to lodge a deposit of £50 in connexion with an election petition in New South Wales In many instances the courts require the lodging of a deposit before they can be moved to hear appeals. In New South Wales, the courts are not permitted to hear an appeal unless the whole of the taxation in respect of which the appeal is lodged has been paid. This provision is considered necessary to prevent the board from being overloaded with objections which upon investigation might prove to be frivolous. In this case we are asking for the deposit of only 1 per cent, of the difference between the assessment and the total value contended for by the taxpayer with a minimum of £50, and we are providing that even if the appellant is unsuccessful, the amount of deposit will be refunded if the board considers that his objection to the assessment was not frivolous or unreasonable.
.- The Treasurer has, perhaps unwittingly, given honorable members the impression that if my proposal were adopted, the board would be flooded with frivolous objections. My suggestion was that the sub-section should be amended to empower the board to impose a penalty on aggrieved taxpayers who lodge frivolous objections. Why require every taxpayer who takes exception to an assessment to lodge a deposit before his objection can be considered by the board? And why impose upon the department all the trouble of refunding deposits to taxpayers? All who have had any experience know that refunds are not made promptly. The Treasurer should not give the Commissioner power to require a deposit from an aggrieved taxpayer. He should, instead, be authorized to impose a penalty upon taxpayers who lodge frivolous or unreasonable objections.
– He might charge against the taxpayer the expense incurred in hearing the objection.
– Yes. An aggrieved taxpayer should not be required tn lodge a deposit, and the board should not be put to the bother of making refunds. The board should be easy of access to all taxpayers.
– Since a taxpayer must be the owner of land worth at least £5,000, it may be presumed that every appellant will be a man of substance.
– That is so.. There should be no doubt, therefore, about the collection of any penalty that might be imposed on a taxpayer who lodged a frivolous or unreasonable objection.
– The suggestion of the honorable member for Wannon (Mr. Rodgers) is a very sensible one, but I understand from the Commissioner of Taxation that the amount of deposit which it is proposed the taxpayer shall lodge is 1 per cent, of the amount of the assessment, with a minimum of £50. In certain circumstances this may represent a considerable amount, and the taxpayer may already have paid a great deal more, under his assessment, than he considered he should be called upon to pay. If, in addition, he is required to lodge a deposit in order to expedite the hearing of his objection, we may presume that, at the outset, the court will be instituted in favour of the man With means, to whom the payment of £50 may be a matter of little moment, whereas, in the case of the smaller man the requirement of a deposit of 1 per cent, on his assessment- - in addition to the extra amount of taxation which already he had paid - may prevent him from lodging an appeal. I see no objection to the provision of sub-section 44l 5 being widened in the manner suggested by the honorable member for Wannon.
Dr. EARLE PAGE (Cowper- Treasurer [11.37] . - I trust that the honorable member for Wannon will not persist with his amendment. It is essential that we should have in the law some provision tq deal with the lodging of frivolous objections. If the board were invested with the power to impose penalities we might have the argument raised, as was our experience in connexion with other boards, that it was exercising judicial functions, and both it and its decisions might be declared unconstitutional. The honorable member will, no doubt, recall the difficulties we have had in connexion with the Income Tax Board of Appeal. That body was unable to function for two years, and finally we had to reconstitute it. If the honorable member persists with his amendment, Ave may find ourselves in the same difficulty. However, I am prepared to accept an amendment to limit the maximum amount of deposit.
.- It would be unwise to discriminate between the provisions relating to the Board of Review under the Income Tax Assessment Act and the board proposed to be constituted under this measure. There is an inclination on the part of taxpayers to lodge objections if they think an appeal to the board may have the desired result. This may cause a vast accumulation of work, and it may operate unjustly in the case of taxpayers who have good cause for complaint concerning their assessments. It is necessary, I think, that all taxpayers who lodge objections, should be required to forward a deposit or else be subject to a penalty in the event of their objection being regarded as frivolous or unreasonable. If the amount of deposit can be limited as suggested by the Treasurer, the objections of the honorable member for Wannon should be met.
– I move -
That after the word “ law “, proposed new section 44l (7), the following words be inserted : - “ and the board shall refer to the High Court any question of law arising before the board, and the decision of the High Court thereon shall be final and conclusive.”
The proposed new sub-section will then read : -
The Commissioner or the taxpayer,, may, within 30 days after the date of the board’s decision, appeal to the High Court from any decision of the board under this section which, in the opinion of the High Court, involves a question of law, and the board shall refer to the High Court any question of law arising before the board and the decision of the High Court thereon shall be final and conclusive.
This is desirable because the valuation board will deal exclusively with valuations. It is not intended to be a judicial body for the determination of any points of law that may be associated with questions of valuation. If, however, any question of law arises, the amendment provides the machinery whereby it may be referred to the High Court for decision. The provision will bring the Land Tax Assessment Act into line with the Income Tax Assessment Act.
Amendment agreed to. 44m. - ( 1 ) Where a taxpayer has, in accordance with sub-section 4 of section forty-four k or sub-section 6 of section forty-four l of this act, requested the Commissioner to treat his objection as an appeal and to forward it to the High Court or the Supreme Court of a State, the Commissioner shall forward it accordingly.
– I move -
That after the word “ shall,” proposed new section 44m ( 1 ) , the following words be inserted “ within 30 days after the receipt by him of the request.”
This is similar to the provision relating to the time limit in the Income Tax Assessment Act. It provides that within the. time stated the. Commissioner shall forward an appeal by a taxpayer to the High Court or the Supreme Court of a State.
Amendment agreed to.
– I move -
That after the word “ fit,” proposed new sub-section 44m (5), the following words be inserted: - “and may review the opinion or decision of the Commissioner upon any matter upon which the liability of the taxpayer depends wholly or in part upon the judgment or opinion or satisfaction of the Commissioner,”
The sub-section will then read : -
On the hearing of the appeal, the court may make such order as it thinks fit, and may review the opinion or decision of the Commissioner upon any matter which the liability of the taxpayer depends wholly or in part upon the judgment or opinion or satisfaction of the Commissioner, and may reduce, increase or vary the assessment.
This amendment is intended to give effect to a principle which I enunciated in my second-reading speech and which was supported by the honorable member for “Wannon (Mr. Rodgers), the honorable member for Dalley (Mr. Theodore) and other speakers. If honorable members will study the various amendments that have been made to the Income Tax Assessment Act they will find that in every case in which the Commissioner was originally granted arbitrary powers such powers must be given to the Commissioner in many cases - there, has been provided the right of appeal to some other authority. There is not a decision of the Commissioner under the Income Tax Act from which the taxpayer cannot appeal. There are sections of the Land Tax Act which give the Commission conclusive power to determine certain matters, and I desire, by my amendment, to apply the principle of appeal that obtains in the Income Tax Act to the Land Tax Act, so that the determinations of the Commissioner may be reviewed. I am not casting any reflection upon the gentleman who is Chief Commissioner of Taxation. I have faith in his integrity and sincerity but, like all of us, he is fallible. The right pf appeal from a one-man decision is an inherent right that should not be denied to anybody. I do not cavil at oneman decisions, as they are essential under our taxation schemes. Yesterday I suggested that we should incorporate in this bill power to constitute an Appeal Board, to which appeals could be made on other than valuation matters. I excepted valuations because it is necessary to have a specific valuation board of experts. The personnel of the Appeal Board which I advocated could be the same as that of the Income Tax Appeal Board. That would not necessitate the setting up of any new machinery, nor would it involve the making of new appointments. No taxpayer, whether he be the biggest or the smallest in the land, should be denied the right of appeal against the decisions of the Commissioner. I am considered to be one who is always pursuing the big taxpayer. I shall continue to pursue the big taxpayer whenever he attempts to evade taxation, but it is only just that he should have the right of appeal to some tribunal or other. A suggested amendment by the honorable member for Wannon (Mr. Rodgers) was rightly opposed by the Treasurer, as it would have put the Land Tax Act out of line with the Income Tax Act. My suggestion would bring the measures into line. I shall not pursue my amendment if the Treasurer agrees to recognize the necessity for provision in the act for appeal. The Commissioner of Taxation is an extraordinarily busy man - perhaps one of the hardest worked public officers in the Commonwealth. He has to make scores and scores of decisions, and it is merely looking for the impossible to expect all of those decisions, made under different sections of the act, and frequently made on the advice of subordinate officers - who, no doubt, are capable - to be’ infallible. Mistakes may be made which may involve large sums of money, and there is no appeal. Not only that, but a mistake might exempt one taxpayer and involve another taxpayer in heavy taxes. A conflicting idea exists as to who is the buyer and who is the seller, also as to who is the lessee, under sections 37 and 42a of the principal act. It does not matter what the question may be, if a person thinks that he has a grievance under a decision -of the Commissioner, and considers it important enough to be taken to a court of appeal, he should not be denied that right. My request should not require elaboration, and I hope that the Minister will accept the principle and introduce an amendment couched in suitable terms to rectify the present omission.
– In order that the committee may appreciate exactly the difference between the Income Tax Act and the Land Tax Act, and the lack of necessity for the suggestion made by the honorable member for Yarra (Mr. Scullin), I shall indicate briefly how the decisions of the Commissioner would be affected by the suggested alteration. If the amendment of the honorable member were accepted it would affect the decision of the Commissioner under certain sections of the act. First, it would affect decisions under section 3, iu which a definition of absentee is given. At present the Commissioner has to be satisfied that the person concerned resides in Australia, before treating him as a resident. The Commissioner should be able to determine that without referring the matter to a board. Section 37 of the act does not vest in the Commissioner any final decision on questions of law, but on questions of fact only. Under it the purchaser is assessable immediately he obtains possession of the land, but not till then. Until then the vendor alone is assessable. The section would need radical alteration if this amendment were accepted.
Section 42 a provides that the Commissioner may determine whether land is in use, occupation or control, and whether the arrangement is of a temporary nature. The Commissioner informs me that there would not be more than one such- case per annum. Section 50 provides that the Commissioner may remit fines, which can surely be done without the assistance of an appeal board. Section 64 authorizes the Commissioner to have full and free access to all lands, buildings, places, books, etc., for the purpose of determining the ownership of any laud. Section 65 gives the Commissioner power, by notice in writing, to cause any person to appear before him to give evidence. The Commissioner is well able to determine practically every one of those matters without reference to a board. As regards the powers given under section 42 a and 50, it is felt that a right of appeal would inundate the court with thousands of cases relating to remissions of penalties for late payment of tax. It would be a reflexion on the department to say that such decisions should be open to review by some separate body. I suggest that we retain the law as it stands, as it makes for more economical and reasonable administration. No one should deny the Commissioner the power given him under section 64. It would hamper the administration of the department if before the Commissioner could take the necessary action, those matters had to be decided by an outside body.
– That procedure would not be subject to appeal. That is machinery administration, and it is distinct from the exercise of the judgment or opinion of the Commissioner. The opinion of the Commissioner is not at stake there.
– That does not come under my amendment.
– The amendment would cre.ate trouble chiefly in connexion with section 37. Section 42a is of small concern and in connexion with it few cases would occur. Its term usually applies only to very short periods - usually for three months.
– It may be for a permanent period, and there should be an appeal from the ruling of the Commissioner.
– Section 37 provides that - “ the seller shall be deemed to remain the owner of the land . . . until possession of the land has been delivered to the purchaser and at least 15 per cent, of the purchase money has been paid…..
Provided that the Commissioner may exempt the seller from the provisions of this section, if he is satisfied that the agreement forsale has been made in good faith, and not for the purpose of evading the payment of land tax, and that the agreement is still in force; as to all which matters the decision of the Commissioner shall be final and conclusive.
The determination of the question is left with the Commissioner. Hehas refused exemption only in cases in which the vendor has remained in possession and made profitable use of the land after the sale, in circumstances where it was apparent that the purchaser was physically and financially capable of fulfilling the terms of the agreement, and of taking possession. The section provides a very necessary safeguard. The Commissioner is fully qualified to determine the matter without any reference to a court. The work in connexion with this section has been very satisfactorily carried out in past years, the only cases in which there has been some dissatisfaction expressed have been cases in which land dealers had made sales which entitled the seller to continue in beneficial occupation of the property.
– Are there many such cases ?
– Only one or two, principally with speculators. There is no reason why such people should be allowed to escape the tax which is rightly due to the Commonwealth. Those are the only cases in which it would be necessary for the over-riding court to operate. The committee must decide whether it thinks the matter of sufficient importance to take from the Commissioner the discretionary power he at present possesses.
.- I listened very carefully to the Treasurer and followed him as closely as I could, havingregard to the peculiar acoustic properties of this chamber. I understood the honorable member to say that he thought that the suggested amendment would be applicable, in some cases, to section 37. The Commissioner’s decision in those cases would affect large landowning companies.
– No, speculators in land; men who buy for subdivision and then sell.
– Perhaps that is fairly general in towns and cities. If those persons sell the land after it has been subdivided, does not the purchaser become the owner and taxable if the value is sufficient to bring him within the scope of the act?
– In certain cases the seller remains in beneficial occupation of the land, even though the 15 per cent, deposit has been paid.
– Has the Treasurer in mind sales that are not bona fide?
– They are bona fide sales ; but there is a definite arrangement under which the seller remains in possession.
– I confess that I have not a particular knowledge of cases of that kind, nor am I able to argue upon them. But if there are certain cases in which the Commissioner may be perfectly justified in regarding the vendor as being still in possession of the land, and thus taxable, surely that would not be a sound argument against the amendment, which is intended to apply generally and prevent any hardship that might be caused by the arbitrary decision of the Commissioner. Even in such cases, would there be any objection to an individual who was assessed, and who objected to his assessment, carrying his appeal to the court? Supposing he was a land speculator, would not the court observe the principles that are followed by the Commissioner and arrive at a decision according to the same considerations of equity? Surely the Commissioner would have regard to the equity of the case and the justice involved. One assumes that the court would act in like manner. I was impressed with the argument used by the mover of the amendment (Mr. Scullin). According to the statistics quoted by the Treasurer himself, there are 21,000 landowners in the Commonwealth who are subject to this law. If only, 5 per cent, of that number were in a position to question the Commissioner’s decision to the extent of lodging an objection to it, more than 1,000 objections would be involved. It cannot be assumed that every decision of the Commissioner is beyond question. They are arbitrary decisions, in the present state of the law. Even under the provisions of this measure the Commissioner will be the final arbiter. It is right that he should be the final arbiter in matters of administration, the imposition of penalties and the application of the machinery of the act; but when principles of wider import are involved, his decision ought not to be final and conclusive. In such cases it is essential, in order to obtain complete justice and prevent the perpetuation of what might be regarded as oppression, that an appeal should lie to the court. There are cases which are not so trivial as those that were mentioned by the Treasurer. It may be necessary to decide who is the rightful owner of land, and to establish liability to tax. Such questions may be of very considerable significance to the taxpayer concerned, and an arbitrary decision by the Commissioner might operate harshly. There should, therefore, be an appeal against it. On the grounds that I have stated, I support the amendment.
.- If the amendment sought to limit, restrict, or remove the discretion that is vested in the Commissioner under Section 37, I should not support it.
– If it would have that effect I would not have moved it.
– So far as I can judge it does not affect what are definitely machinery powers.
– The Commissioner has assured me that it will operate in each of those cases.
– The Treasurer could easily amend it.
– I cannot see how it operates in that way. For the time being, however, I shall confine myself to what the Treasurer regards as the crux of the matter. The amendment does not restrict or remove any powers; it leaves quite untouched the discretion of the Commissioner in certain respects. All that it does is give to the taxpayer what the honorable member for Barker (Mr. M. Cameron), in his very practical way, last night suggested should be given, namely, the right <of appeal by an aggrieved taxpayer against the Commissioner’s decision. Section 37 is a very important one. It provides -
As has been pointed out by the honorable member for Dalley (Mr. Theodore), there are many subdivisions in respect of which, at times, it is impossible for a purchaser to take actual physical possession after the sale. To say that a purchaser who has put up his purchase money and fulfilled- all the other terms of his contract up to that stage, but has not taken actual physical possession, shall not, in law, be deemed the purchaser, is to exercise, a very extreme discretion. These are not facts about which there may be some difference of opinion. So far as I can see, only questions of law will arise, as to what constitutes ownership and when ownership actually takes place. It is a departure from the, spirit which underlies the right of appeal by taxpayers on questions of law, to vest in one man complete authority to deal with those questions. I urge the Treasurer to accept the, amendment so far as it relates to section 37. If necessary, the Deputy Leader of the Opposition (Mr. Scullin) could amend his amendment so as to bring it within those limits. I do not suggest that the decisions of the Commissioner on matters of machinery should be subject to appeal or review. The question of ownership is one of the most fruitful causes of litigation in the act. There immediately arises the declaration by one man that he has paid his purchase money, although for some reason or other he is not able to go into actual physical possession of his purchase. In such a case the seller is still liable to be taxed. In section 37 Parliament deliberately set out to determine what percentage of the purchase should be paid in order to constitute ownership and to have the name of the prior owner removed from the register of landowners. If there were any doubt as to whether a payment was fictitious or actual the Commissioner could call for a declaration or any other evidence he required ; but to permit him to be the sole judge as to when a legal condition has been satisfied in such a way as to constitute one man the owner, is to give him a legal power that Has always rested solely with the courts of this country.. On legal questions relating to ownership of land, the Commissioner must not be the final and arbitrary authority. I suggest that the Treasurer and the Deputy-leader of the Opposition confer to see whether the amendment can be so amended as to confine it to section 37.
.- The Treasurer has drawn attention to the fact’ that if this amendment is agreed to quite a number of machinery clauses will be affected ; and the honorable member who has just resumed his seat .(Mr. Rodgers) has suggested that the Treasurer and the Deputy-leader of the Opposition should confer with a view to amending the amendment, so as to exclude those machinery clauses. The Deputy-leader of the Opposition has already intimated that he is quite prepared to do so. His intention is, not to bring in the matters enumerated by the Treasurer, but to give the right of appeal in regard to matters that may arise under that most important section, 37. The Treasurer has stated that there have been subdivisions of estates by speculators, that only 15 per cent, of the purchase money has been paid, and that the Commissioner has had to decide upon the nature of the assessment he should issue. Yesterday the committee discussed at length the question of an appeal from the Valuation Board. This is an altogether different matter. We intimated yesterday that on questions of law there should be the right of appeal. We are now discussing questions that might arise between the Commissioner and the vendor, in which the vendor may think that the Commissioner is not ‘ fully seised of the facts or that, taking all the facts into consideration, his decision is not a satisfactory one. I cannot conceive of many cases of the kind arising, but even if there should be only a few they should be met fairly The cases that I have in mind are quite different from those that arise in the ordinary way, and I think that the Treasurer could easily meet with the wishes of honorable members in respect of them. It is not just that these people should be denied an appeal of any kind.
– There is a good deal in this proposal that merits consideration, but I wish the committee to realize the difficulties of the situation. Section 37 of the principal act, which would be affected by the amendment, was in our original Land Tax Assessment Act and has always operated smoothly. The proviso to sub-section 1 of it leaves to the Commissioner the decision first as to whether the agreement for a sale is still in force; secondly, whether it was made in good faith, and not for the purpose of evading the payment of land, tax; and thirdly whether the purchaser had obtained occupation. Questions of fact are involved in determining those matters. Yesterday when the proposal to appoint a valuation board waa under consideration it was argued that the courts should not be permitted to determine questions of fact; but to-day, apparently, honorable members wish to have them submitted to the court.
– The matter under consideration yesterday was entirely different from this.
– Suppose that a question arose as to what is possession?
– It may happen that a sale of rural land has taken place and that the necessary 15 per cent, of the purchase money has been paid, but no fences have been erected on the property, and the original vendor is still running his sheep on the land and otherwise obtaining benefit from it. In such a case the Commissioner has ruled that the vendor is still in beneficial possession of it.
– Suppose that both the vendor and the purchaser are running sheep on it?
– Then both parties would be obtaining benefits, and the Commissioner would probably determine that the purchaser had obtained possession of it. To insert such an amendment as this, it would be necessary to recast the whole section. If the committee desires that to be done, it will be necessary to ask for time in which to do it. The real matter for the committee to determine is whether the right to decide the three points which I have mentioned shall be taken from the discretion of the Commissioner, and placed within the jurisdiction of the court.
– I suggest that the Treasurer should ask for the postponement of the clause until he has had an opportunity to consider this matter carefully. I do not desire to do anything that will hamper the Commissioner in the discharge of his onerous and important work, but without such a provision as that contained in the amend ment there is a danger that grave injustice may be done to certain taxpayers. There is always such a danger when one man has the power to determine, without appeal, important questions of fact. The Treasurer mentioned the case of a sale of rural land. I assure him that trouble rarely occurs in that regard, for the purchaser of rural land knows that he must immediately bring it into productive use, or it will become a burden to him. The purchaser of such land permits the vendor to run sheep on it only after some arrangement is made in respect of agistment. It happens that I am interested in the purchase of certain land at present, and the parties to the deal have arranged that both shall run an equal number of sheep on the property. In such a case, according to the Treasurer, the Commissioner would determine that the purchaser had obtained possession.
– But suppose that he decided otherwise?
– The vendor would have no redress.
– He could still object to the assessment in the court.
– On the three points that have been mentioned, the Commissioner is the sole arbiter. The difficulty is likely to arise in connexion with the sale of suburban land. As everybody knows, the purchaser of suburban land does not take actual possession, in many cases, for quite a long while. He may have bought the land for speculative purposes, or for his children, or for the purpose of building a home for himself in later years. In any of those circumstances he would not build a fence around it, for a fence would be a wasting asset. I suggest that the Treasurer should ask for the postponement of consideration of the clause and that he and the DeputyLeader of the Opposition should confer with the Commissioner of Taxation to see whether an amendment can be drafted to give effect to our desires.
– I support the suggestion of the honorable member for Wannon. I have no desire to take from the Commissioner any of his power to administer the machinery sections of the act, and I am rather astonished at the assertion that this amendment would do it. It is not intended for that purpose. What I wish to affirm is that the principle which is embedded in so many sections of the Income Tax Assessment Act, that there shall be an appeal to some tribunal from every arbitrary decision of the Commissioner of Taxation, shall be embodied just as completely in this measure. Last night we had a struggle with the Treasurer in regard to appeals on valuations, and the honorable gentleman maintained firmly that two choices should be given to the taxpayer. It is inconsistent, therefore, that in this instance he should not be willing to grant even one choice. The Treasurer has said that if a vendor remains in possession he is taxed. I agree that he should be. But the vendor may be of the opinion that he is not still in possession, and if the Commissioner determines that he is, he has no redress. When a question of fact such as that requires determination, surely it is not reasonable that the Commissioner should have the sole right to decide it. The question may also arise as to whether a particular person is still in beneficial occupation of the land. I submit that it is fair that a taxpayer should have the right to appeal on an issue of that kind. As the Treasurer has stated, the three points on which the Commissioner has discretion are - that the sale has been made in good faith; that possession has been given.; and that the agreement is in force. Let us suppose that the Commissioner ruled that one of those requirements had not been complied with - that the sale had not been made in good faith - and that the vendor insisted that it had been made in good faith. A dispute might arise; but if so, there would be no right of appeal. Then again” the Commissioner might say that the buyer was not in possession. Again a dispute might arise; but still there would be no right of appeal. Let us consider the case mentioned by the honorable member for Wannon (Mr. Rodgers) in which a man buys half a a property and agrees with the vendor to dispense with the erection of a dividing fence, and to run their stock over the whole of the property. The Commissioner might say that the buyer was in occupation of the land, whereas the buyer could claim that he was not in possession, because the vendor’s sheep were running on it. I do not say that the Commissioner would knowingly come to such a ridiculous decision; but with his multifarious duties, he might inadvertently do so. If he did make such a decision there would be no body to whom an appeal could be made. Surely that is a wrong principle. I agree with the Treasurer that a person who runs sheep 01 a property and derives profits therefrom should be taxed; but we must provide for cases in which the vendor is in full occupation of only a portion of his estates.
– The Treasurer should not be afraid that the court would not uphold the Commissioner if his decision was right.
– If the matter is so simple that the Commissioner can scarcely go wrong, where is the danger? The court would uphold him if his decision was right. My desire is that where it is a question of fact aboard, and not the court, should be called upon to decide it, but there is no appeal board to which such matters could be referred. I have suggested that an appeal board could be constituted without creating a new authority ; the Income Tax Board of Appeal could be called upon to act. Otherwise the only remedy is to have the right of appeal to the court. I have no desire to interfere with the administrative machinery, and am willing that further consideration of the clause be postponed. I am concerned with the principle underlying the clause. No man, even though he possesses a million acres of land, should be deprived of justice; he should have the right of appeal in matters of taxation.
– I am at a disadvantage in that I have heard only a portion of the debate on this clause. It may be that what I am about to say has already been fully stated. If so, I crave the indulgence of the committee. I should like to point out that in section 37, there is a substantive provision that the buyer in certain cases shall be deemed to be the owner of the land so soon as he has obtained possesson of it; and that in the cases mentioned in paragraph b the seller is deemed .to be the owner of the land, with, however, iri the latter case, a proviso for exemption. That proviso permits an exemption from this liability in cases which are dependent on the Commissioner being satisfied about certain matters. If he is so satisfied, he may exempt the seller from the liability imposed by that section. The opinion of the Commissioner is final and conclusive only as to the exemption of the seller. No liability can be imposed upon the seller, or upon any other person, by reason of the Commissioner’s opinion. Let us consider a case in which the Commissioner is not satisfied of the necessary facts to justify him in granting an exemption in favour of the seller. I understand that that is the point under consideration. The buyer is deemed to be the owner of the land so soon as he has obtained possession of it. Whether he has, or has not, obtained possession of the land is not a matter which in any way depends on, or is affected by, the opinion of the Commissioner. On that question the buyer has the right of appeal provided by the act - a right which is altogether independent of the opinion of the Commissioner.
– To whom can he appeal ?
– To the court. Suppose the vendor was assessed as the owner of the land. He could immediately claim that he was not the owner, because he had sold the property. The Commissioner might then say that he was in possession of it, and again he could allege that he was not. On that matter he could appeal in the ordinary way. Accordingly, so far as the fact of possession of the land is concerned, he has the right of appeal. If the Commissioner decides in favour of the seller there is no ground for complaint on the part of either the buyer or the seller. If he does not so decide, then both the buyer and the seller have their ordinary rights unimpeded by any opinion of the Commissioner. The main point is that the opinion of the Commissioner has effect only for the purpose of exempting a taxpayer; it cannot impose any liabilities. The facts which are referred to in section 37, sub-section 1, paragraphs a andb must exist. That being the case, I suggest that this clause cannot impose any liability upon a citizen by virtue of an unappealable decision of the Commissioner.
– The legislature deliberately included a proviso to exempt the seller when a sale is made in good faith. That was done to enable him to obtain an exemption, even though the letter of the paragraphs a and b was not fulfilled.
– The point of section 37 is that buyer and seller may be taxed in certain cases although there has been a sale of the land. They can be taxed only in cases in which certain facts exist. But there may be a release of the seller under the proviso, even though the. facts set out in the earlier provisions of the section exist.
– That is so. Where, in fact, possession has not been given in strict accordance with paragraph b, the seller may still be exempted under the proviso.
Mr.Rodgers. - Paragraph b and the proviso are the only points at issue; paragraph a does not come into account.
– If the Commissioner says that a sale has not been made in good faith there should be some right of appeal against his decision.
– The actual possession is not in question. Most contracts of sale contain a provision relating to possession.
– The question arises as to the definition of “ possession.”
– That cannot be determined by the Commissioner under this section, because a liability cannot be imposed upon the seller except where the facts exist. Even where the facts do exist, the Commissioner may still grant an exemption. No liability can be imposed by virtue of the opinion of the Commissioner.
– Should there not be a right of appeal if exemption is refused on a wrong decision ?
– Suppose an exemption is refused because the Commissioner mistakenly thinks that the agreement has not been made in good faith. In that case no one is liable unless the facts which are referred to in the earlier part of the section are established, and as to those facts, the taxpayer has the ordinary right of appeal.
– The facts may be all right, but the provision for exemption is there. A man may be exempted if he can show that the agreement was made in good faith, even though he had not complied strictly with all other conditions.
– It would be competent ‘for the committee to introduce a provision giving the power of exemption to some one besides the Commissioner. I suggest that where it is a question only of the power of exemption, and where the exercise of the Commissioner’s power of exemption cannot impose a liability upon anyone unless the facts which are mentioned earlier in the section exist, luxation cannot be wrongly imposed.
– It is on the ascertainment of those facts that he arrives at his decision.
– As there appears to be some doubt as to the effect and wisdom of the clause, I suggest that consideration of it be postponed. .
Clauses 18 to 20 agreed to.
Sitting suspended from 12.43 to 2.15p.m
Section forty-nine of the principal act is repealed and the following section inserted in its stead : - “49. (1.) Land tax for each year shall be due and payable thirty days after the service by post of the notice of assessment.
Section proposed to be amended -
Landtax for each year shall be due and payable on such date as appointed in that behalf by the Governor-General by notice published in the “ Gazette “ not less than one month before the date so appointed.
– The matter that I intend to raise is of some importance, but I do not propose to deal with it at great length. I intend to emulate the attitude of the Opposition, which, I think, during the discussion on this bill, has put its case with admirable brevity without detracting from the proper presentation of its views. It is a matter of general knowledge that when payment has been made under an original assessment, a. reassessment, or an amended assessment, the matter stands there. ‘ The taxpayer pays the amount assessed against him by the Commissioner, and if he is not satisfied and decides to appeal, he knows that, after lodging his appeal, he will probably hear nothing further about the matter for six months or more. Having paid his money he loses it for the time being, and he loses also, of course, the interest on the money. That capital and interest are for the time being held by the Taxation Department, which gets the benefit of both. Whether, eventually, the Commissioner decides voluntarily to reduce the assessment, or the matter goes to a hearing, and the court decides that the assessment must be reduced, the unfortunate taxpayer does not receive interest on his money, although he may get back some of his capital. I am not speaking without my book. Many persons who have furnished returns, whether as solicitors or trustees for estates or private individuals, have had their money held, by the Taxation Department for many months without the matter ever coming to a hearing. In some cases the amounts so held were large. I do not wish to make accusations against the department. It is not desirable to overstate one’s case, if one can avoid doing so. We must admit that at the beginning of the year the Commissioner has a very large number of returns which have to be considered and dealt with, The, work for the time being must be heavy. Nevertheless, I can see no reason why, at any rate, the more important cases in which objections are lodged against assessments should not be sifted out and brought to a more immediate hearing than is the tendency at the present time. I do not propose to go into the subject of the return of interest. I think that the interest is distinctly claimable in equity, and if a Government takes from taxpayers a sum of money to which it is afterwards proved by the decision of the court, or by the admission of the Commissioner himself, that it had no legal right, it would not be unreasonable for the Government to pay interest to them on the difference between the Commissioner’s assessment and the final assessment of the court.
– But the Commissioner does not charge interest on the basis of an amended assessment, so it cuts both ways.
– I shall be glad if the honorable member will clear up that point.
– A penalty of 10 per cent, is imposed where payment is delayed.
– That probably more than counter-balances any advantage that the taxpayer may receive. Even if eventually the amount assessed were hold to have been due in toto, we ought to put a definite limit to the time for which the Commissioner could hold the taxpayer’s money without bringing the case to a decision. I have not the slightest doubt in my mind that it is grossly unfair that when money has been paid and notice of objection has t been lodged, nothing whatever is done for perhaps, over a year. It is not proper that the Commonwealth should hold moneys to which it is subsequently proved to have no right, and hold them for an unlimited period of time. In a case of estate duty decided in the Privy Council in 1925, C.L.B. Vol. 37, I understand that the matter was in abeyance for no less than three years. During that time the Government held £24,000 to which it was subsequently ruled by the Privy Council to have had no right, and not a penny piece of interest was ever refunded to the appellants, although they won their case. I am not suggesting that it was illegal; there is no provision for the payment of interest by the department. It must be obvious to every honorable member who has a sense of fairness, and therefore I say it will be recognized by all honorable members, that this is not a proper position. If we are here to see that the Commissioner gets a fair deal, we are also here to see that the taxpayer receives . proper treatment. I do not know that I should go so far as did the honorable member for Swan (Mr. Gregory) this morning, and say that the department is safeguarded always and the taxpayer never; but in view of his assertion, I am confident of the assistance of that honorable member with regard to my amendment. One of the objections that may be taken to it is that a large sum is involved. Whether the sum is large or small, I do not see that it affects the question at issue. If a thing is improper where a small sum is involved, it is equally improper with regard to a large sum. I shall listen with interest to any view expressed by the Opposition on this point. The honorable member for Yarra said this morning he was desirous of seeing even the “ big “ man receive a fair deal under the taxation acts. This is not necessarily a matter that affects the “ big “ man any more than any other taxpayer ; but I hope that the honorable member, and the Opposition generally, will see that it is hot reasonable that even a Commonwealth Government department should receive money and hold it for an indefinite period without the taxpayer receiving interest for it. I hope that the Opposition will assist in seeing that the scales of justice are held even. I propose to submit a new sub-clause. Putting it briefly, the first point is thai an assessment is made, the second that a notice of objection is lodged, the third that the money is paid, and the fourth that there is delay. I suggest that if the delay is for more than a reasonable period interest should be paid to the taxpayer. The period I have suggested may strike some honorable members as being rather short; I would not stick to the exact period that I have suggested, namely, three months. It may be that that is not sufficient. My chief desire is to have a definite period named. If there is not a hearing of such a case within three months, or such longer time as the committee may consider fit, the Commissioner should refund to the taxpayer until the hearing takes place the difference between the tax on the amount of the Commissioner’s assessment and on the amount of the taxpayer’s claim. That does not mean that the Government would lose its opportunity to obtain the money again if the appeal is finally heard and decided in its favour ; it means that no Government department will be able to hold for more than a certain period, the difference between the tax on the amount of. the Commissioner’s assessment and the amount which the taxpayer thinks he is entitled to pay. It has been suggested that in some cases of appeals involving a reference to the High Court, it might be desirable to make the period longer, but the point L emphasize is that there should be a definite term within which the Commissioner can hold the taxpayer’s money but beyond which he must refund a certain portion of it if he has not pressed the appeal to a decision. That would provide an incentive to the department to press on wilh the hearing of appeals, and taxpayers would not be held up for a year or even two years pending decisions in reference to their appeals, when they are out of pocket in respect of not only their capital, but also interest on it. If by any chance an appeal is unreasonable, frivolous or evasive, the Commissioner can easily have it dealt with within the prescribed three months.
– Does the honorable member propose to provide for payment of interest on the amount of the taxpayer’s money held by the Commissioner ?
– No ; that would be a difficult matter to arrange. I do not waive my view that it is equitable to pay interest to the taxpayer on the amount of his money which is held by the Commissioner, but that would involve such an intricate calculation that I think it is preferable to submit my amendment in the form which I propose, although it may not do absolute justice to the taxpayer. I move -
That the following sub-section be inserted: - “ (3) Whenever land tax shall have been paid, whether upon an original assessment or upon an alteration or addition thereto, but an appeal or notice of objection shall be lodged by the taxpayer with reference thereto within the prescribed time, the difference between the tax on the value returned by the taxpayer and the tax on the amount assessed by the Commisionioner shall be refunded to the taxpayer at the expiration of three months from the time of such payment and shall not be repayable (whether under any further assessment of the land in question or not ) until such appeal or notice of objection shall have been heard and determined.
– The guiding principle actuating the honorable member for Boothby (Mr. Duncan-Hughes) in submitting his amendment is his desire to accelerate the hearing of appeals from assessments made in the taxation office, and the remedy he suggests is that’ at the end of three months, if no decision has been reached, certain moneys shall be refunded to the taxpayer. I submit to the honorable member that the method he proposes in the amendment is not the best way to secure the result he desires. Nor is it a method which the administration of the taxation office could contemplate with equanimity. The bill already concedes many things to the taxpayer which will tend to reduce his past difficulties. The fact that there is now to be a triennial valuation will mean that for two years at any rate many of those difficulties will not arise. In addition the absence of retrospective re-assessments will remove what is at present a frequent source of irritation and dispute. In addition to the provisions already in the bill, the Government is proposing amendments to secure that objections to assessments shall be handled with the utmost despatch. In proposed new section 44 k (2) at my instance,, the committee has already inserted the words “ shall with all reasonable despatch,” and in proposed new section 44 m provision has been made, also at my instance, for the insertion of words providing that the commissioner shall act within 30 days of the receipt of a request by the taxpayer. These amendments will ensure the utmost expedition in dealing with appeals, but if we adopt the suggestion of the honorable member for Boothby, we shall discriminate between the taxpayer who lodges an appeal and the taxpayer who raises no objection to his assessment. The latter will pay his money to the Taxation Commissioner, but the former will get a refund of the difference between the amount of the tax which he thinks he ought to pay and the amount which the commissioner thinks he ought to pay. It is quite impossible to say how much time will be occupied in dealing with appeals, but they ought to be dealt with speedily because there are at the present time in the whole of the Commonwealth, only 52 unsettled objections against land tax assessments. A board is to be appointed to deal with these appeals, and it ought to be able to get on with the work fairly rapidly. At any rate, the Government thinks the acceleration of appeals can be secured in that way better than by refunding temporarily the difference between what the taxpayer thinks he ought to pay and the amount at which the commissioner has assessed him. I do not think the amendment as worded will provide for what the honorable member intends, but if the committee adopted his proposal it would involve the Commonwealth Treasurer in refunds amounting to hundreds of thousands of pounds each year.
-Hughes. - Representing money to which the Crown is not entitled.
– I remind the honorable member that that issue remains unsettled until the appeals are decided.
– But why penalize the taxpayers in the meantime?
– How can the country be run if no one can be asked to pay his assessed taxation until he has put in an objection, and the matter has been tested in a court of law? The effect of an amendment like ,this would be a general increase of taxation to make up for the shortage of revenue’ and this further taxation would have to be borne by those who do not adopt the practice of objecting to their assessments. The man who does not object to his assessment has no money handed back to him. It is more or less prejudging a case to say that because a man says he is not entitled to pay he should not be expected to pay.
– Only if the appeal is not heard within a reasonable time.
– Is three months a reasonable time? It is better to do as’ the Government suggests and make it unnecessary to re-value more than once every three years. A provision on the lines suggested by the honorable member for Boothby would be a direct incentive to the taxpayer to raise a dispute, about his assessment in order to get the use of his money for a longer period than is now possible. It would also keep the Appeal Board business so congested that it would be impossible to have appeals dealt with as speedily as possible. As the honorable member’s suggestion, if adopted, would involve the Treasury, in refunds amounting to hundreds of thousands of pounds, and instead of composing disputes, would have a tendency to breed them, I must ask the committee to reject the amendment.
.- I agree with the honorable member for Boothby (Mr. Duncan-Hughes) that we must make our taxation measures just, but there is a certain amount of argu ment to be put forward on both sides of the question he has raised by his amendment. I do not think that the Treasurer’s statement of the case is altogether impartial, nor do I think that all of the interjections which punctuated the Treasurer’s speech were impartial. The purpose of the amendment is to provide that any sums of taxation in dispute shall be refunded to the taxpayer after three months, and shall not be payable until the dispute is determined. Some honorable member interjected that the amount in dispute belongs to the taxpayer. Surely the ownership of the money has to be determined by the court or the Valuations Board, so it cannot be said to belong to either the department or the taxpayer. There is, however, reason in the argument of the honorable member for Boothby that while the money is in dispute it is no more the property of the department than of the taxpayer. If the department holds that money for an undue length of time and the dispute is ultimately determined in favour of the” taxpayer, he has suffered a considerable deprivation. But the time suggested in the amendment is too short. It would be unfair to require the department to refund to the taxpayer within too short a period money that the department does not think he is entitled to. The Treasurer said that such a provision would encourage people to lodge objections against their assessments. It might have that effect, but if a reasonable time were prescribed - and I think six months would be reasonable - it would not encourage the taxpayer to be disputatious. After all, the amendment would impose a penalty on the _ department. It would involve a large amount of clerical work and necessitate refunds of large sums of money, some of which would ultimately have to be collected again. I disagree with the Treasurer’s contention that the case stated by the honorable member for Boothby is met by the concessions already in the bill. The triennial valuation may lessen the cause or frequency of disputes,, because disputes on valuations will ariseonly once in three years instead of. annually, but it is not right to say that because only a few persons will be affected! an act of justice should not be done. “ Let justice be done though the heavens fall.” Even if only one taxpayer is affected, he should be given justice if possible. I would be prepared to support the amendment if the period were altered to six mouths. That may seem an unduly long time, but delays occur that are not entirely due to the department. The court is sometimes responsible for them.
– The Valuations Board should expedite the hearing of appeals.
– But the board’s jurisdiction will be confined to valuations, disputes arise which are often outside the subject of valuation, and have to be referred to the High Court. If moneys to which the department is not entitled are withheld from the taxpayer for an unduly long period an injustice is done to him. I hold strongly the view that the function of this committee is to favour neither the department nor the taxpayers; it must frame’ a law that will deal out evenhanded justice.
.- I am in favour of the amendment, but I think that three months is too short a period, especially as appeals sometimes delay the determination of taxation disputes for long periods. Probably justice would be done to both parties if the period were extended to six months. “When money in dispute is held by the department, the taxpayer is temporarily deprived of both the principal and the amount of interest that it would be earning. The department would stand no risk pf losing the principal, because the tax when finally fixed would be a charge on the land. I do riot know whether it is the practice of the department to allow interest on moneys held by it, and subsequently . declared by tlie court to belong to the taxpayer. There is no reason why the taxpayer should not have the option, instead of paying cash, of handing over to the department some security, such as a savings bank book or Government bonds. If that were done he would be losing no interest 011 the amount in dispute.
– But the department would be losing interest.
– Only if the money were declared to belong to the department.
.- I commend the motive which prompted the honorable member for Boothby to move the amendment. I do not commit myself to its exact form and phraseology, because it is not easy to decide off-hand whether the words employed in an involved phrase convey the meaning that is intended. When a dispute arises over an assessment, the amount at issue belongs to neither the taxpayer nor the taxgatherer; its ownership is undetermined. Perhaps the most equitable way to handle such moneys would be to pay them into a trust account controlled by the department and bearing a fixed rate of interest. The interest would follow the principal to the taxpayer or tax gatherer in accordance with the decision of the tribunal dealing with the dispute. Under that system the security held by the Taxation Commissioner would be more complete, as the money would remain in the possession of the department until its destination was ‘decided. Whoever received the money ultimately would have suffered no injustice because it would have been earning interest all the time its fate had been in doubt. The Treasurer said that the object of the amendment was to expedite the settlement of disputes. Whilst the mover had that in mind, another prime factor was the necessity for the Government to be absolutely just in dealing with the taxpayers. If a taxpayer does not pay his assessment within a prescribed time he is mulct in a penality of 10 per cent. In some cases, through no fault of the taxation authority, large sums have been held by the department pending the settlement of a dispute, and have been subsequently returned to the taxpayer without any compensation being given to him for having been deprived of his money for many months. In the case mentioned by the honorable member for Boothby the department held one amount of £20,000 for about three years, and ultimately returned it to the taxpayer without any interest. Many persons who own large areas of land have not big sums of ready money with which to pay their taxation. Sometimes because the amount demanded by the department is larger than the taxpayer expected it to be, and for which he has made provision in the ordinary way, he is required to raise the extra amount on mortgage and pay interest on it. Even if the money is ultimately returned to him following a successful appeal, he is out of pocket to the amount of the interest he has paid upon it, or if the money had not been borrowed, the amount of interest it would have earned. In that way he has suffered an injustice, not through any wrong-doing on the part of the Taxation Department, but solely because the commissioner’s interpretation of the law was not accepted by the court. The law provides that a dishonoured promissory note shall bear interest until the date of payment. In connexion with taxation appeals a man may have to incur considerable expense in establishing his rights, and yet merely receive a refund of the amount he is out of pocket, without any interest thereon. The Treasurer suggested that if this amendment were made, taxpayers would ‘be* encouraged to lodge objections, and that would be unfair to the taxpayer who paid without objection. That argument is not sound. If a taxpayer1 is satisfied with his assessment and pays it within the prescribed time, that is the end of the matter. If he is not satisfied, he is entitled to adopt the appeal procedure that the law provides. No man would frivolously lodge an objection against an assessment, because he knows that if he loses the appeal he will have to pay expenses which will add considerably to the amount of his assessment. I agree with the suggestion that the period after which a refund may be demanded should be six months. If that is not acceptable to the Treasurer, possibly he will consider the payment’ of the amount in dispute into a trust fund which would bear interest. There is no reason why it should not be put straight into the Commonwealth Bank, and carry interest at the current rate for loans of 4^ ‘or 5 per cent., the money and the interest following one destination eventually, and going back either to the taxpayer or to the Treasury.
.- Is it necessary that any such deposit should be made.? A person who is assessed for taxation on land certainly has a considerable asset, and the Government has the power to secure itself against loss. Why collect the money at all? I do not think that- the Treasury should hold money which does not belong to the Government, pending the time it is decided to whom it does belong. A sense of injustice is created by many such acts as this on the part of the Customs and Taxation Departments. These things do not tend to create that feeling of confidence in governmental departments that ought to exist. I feel that the honorable member’s amendment should be carried, but that the period should be fixed for six months, so that there would be a definite time in which a settlement must be arrived at. I think the Treasurer should concede this point.
.- The taxpayers of the community will appreciate anything done by a committee of this House to make their conditions more agreeable. I have not got the honorable member’s amendment before me, but I’ understand that it contains a suggestion that interest should be paid by the department on money held and eventually refunded. As pointed out previously, it would be necessary to charge interest when the position was the other way about, when the taxpayer held money which it was eventually found belonged to the department. It seems to me that there is a difficulty in deciding what is a reasonable time during which such a provision should operate. As one who has had experience with the department, and has practised as a public accountant outside, while I do not hold any brief for the commissioner or the department, it seems to me that whatever law we pass, we must leave, a good deal to the administration. The subject of late penalties has been mentioned.- I have never known the commissioner or his officers fail to give reasonable consideration in the matter of late penalties when a reasonable case can be brought forward. The penalty is not made to operate until full consideration has been given to the matter under review. Now we are con.fronted with the difficulty of determining what is a reasonable time. I should like to hear from the Treasurer whether he might not in special circumstances leave the determination of such a point to the discretion of the commissioner. My experience has been that every reasonable consideration is given to taxpayers by the department, particularly to those who are prepared to state their case in a fair way.
– May I point out that it would be incurring a great risk if the department were to pay back to the taxpayer money which probably, at a later stage, might be due to the department. Only in the last week or two we observed a bankruptcy notice, where something like £25,000 of tax was one of the principal items in the account. It is true that the tax is chargeable on the land, but there are some cases in which it is -very questionable whether it would ever be possible to collect the tax in the event of an insolvency. I think it would be a very cumbersome proceeding to substitute, as the honorable member for Kennedy suggested, a trust fund for1 the present practice of holding the money, and subsequently making’ refunds. The suggestion has also been made that interest should be paid on such moneys. That scheme has been examined in nearly every country in the world, and it has been decided that it cannot be done. It would be necessary to increase taxation to enable such a scheme to be carried out. If We act in the way suggested regarding moneys in possession of the department, which may be handed back to the taxpayer, we should apply the same principle in cases in which the law has authorized the Commissioner of Taxation to permit the taxpayer to delay paying his taxes in circumstances which may reasonably justify that course. In that case the Commissioner does not charge interest on the tax, which is withheld but finally paid. The Government is in the. hands of the committee in this regard; but the principle involved in this amendment does not seem to be fair. I ask the honorable member for Boothby to examine clause 28 of this bill, which provides for a penalty where there has been an omission of land from assessment, and to say whether, in a case such as that, the taxpayer should receive the difference between the assessment by the department and the tax which lie considers himself entitled to bear.
– My amendment is not now in the form in which I presented it to the Treasurer last night. It was pointed out to me this morning by the Commissioner of Taxation, that, as. it stood, it meant the refund of the difference between the amount of the taxpayer’s return and the Commissioner’s assessment. I drafted the amendment myself, and what I meant to convey was that the difference between the taxes as assessed by the taxpayer and the Commissioners should be refunded. As soon as the. error was pointed out to me I changed the wording of the. amendment. In regard to the Treasurer’s point that the Government might suffer in the case of an insolvency, I was under the impression myself, and the honorable member for Bendigo (Mr. Hurry) confirms it, that the Government was already safeguarded in this respect. Here is the provision to which I refer -
Land tax shall until payment be a first charge upon the land in priority over all other encumbrances whatever, and notwithstanding any disposition of the land it shall continue to be liable in the hands of any purchaser or holder for the payment of the tax so long as it remains unpaid.
In regard to the provisions under clause 28, I have-not had an opportunity of reading it in detail. I think he had in his mind the question of evasion. This clause refers to failure and neglect to make returns, and also to failure or neglect to make returns or evasion. I do not, for a moment, wish that the amendment which I have moved should benefit any one who is evading his obligations, and I do not think it will have that effect. The Treasurer raised one or two points to which I should like very briefly to refer. He took the line that this amendment would mean a great loss of money to the department. That, I think, has been sufficiently answered by the remarks of the honorable member for Kennedy. This money does not belong to the department. It may be also said that itdoes not belong to the taxpayers. The money is in dispute, and to suggest that it should not be refunded because the Government has it in its hands, seems to me to miss the point at issue altogether. Then again, on the question of expedition, 1 suggest to the Minister that my amendment assists in expediting settlements. If, as stated, there are very few notices of objections and appeals at present outstanding, this will perhaps assist in making them fewer still. It is not a matter which the Government should regard as a very grave one. Practically all the speeches which have been made have been in agreement with the general principles which I endeavoured to enunciate at the beginning of my remarks. The chief objection made is that a term of three months is not sufficiently long. I do not wish to be unreasonable, and I am quite prepared, if the committee give me leave, to amend my amendment so as to make it read “ six months “ instead of “ three.”
Amendment amended accordingly, and agreed to.
Clause, as amended, agreed to.
Clauses 22 to 26 agreed to.
Section sixty-six of the principal act is iiuiuiided -
by omitting sub-section (1) and inserting in its stead the following subsection : -
In any case where it is shown to the satisfaction of a board . . that a taxpayer liable to pay land tax has become bankrupt or insolvent, or has suffered . . . the board may release such taxpayer wholly or in part from his liability . . . and the Commissioner may make such alterations in the amount of tax payable and may make such refund of tax already paid as is necessary to give effect to the decision of the board.”;
Section proposed to be amended -
– ( 1 . ) In any case where it is shown to the satisfaction of the Commissioner that a taxpayer liable to pay land tax has become bankrupt or insolvent or has suffered such a loss that the exaction of the full amount of tax will entail serious hardship, or that, by reason of drought or adverse seasons or other adverse conditions, the returns from the land have been seriously impaired, a board consisting of the Commissioner, the Secretary to the Treasury, and the Comptroller-General of Customs may release such taxpayer wholly or in part from Ms libailily, and the Commissioner may make such entries and alterations in the assessment as are necessary for that purpose..
– From the remarks of honorable members opposite, one would imagine that no allowance was made in the Land Tax Assessment Act for hardship suffered by reason of droughts, floods, and similar acts of God. Such a provision has always been in the act, and, whatever serious hardship has been experienced by a landowner, it has been taken into account by the Hardships Board. I think that the present amendment is merely a redundancy, but I have no objection to it.
.- The honorable member for Maribyrnong (Mr. Fenton) has intimated that justice is always done where land-owners suffer severe hardships from various causes. I do not see that this clause gives away much. “When a man becomes bankrupt or insolvent, it is necessary to give him relief from taxation, and relief should be afforded to every one who is subjected to financial distress through abnormal conditions. I have received advice that, in the opinion of the Commissioner, the word “may,” which comes after the word “ Commissioner,” second occurring in this clause, does not mean “ shall.” Generally and legally speaking, and subject to the facts being proven, the word “ may “ is interpreted as “shall.” I move -
That after the word “ Commissioner “, the word “ may “ be omitted, with a view to insert in lieu thereof the word “ shall “.
The last portion of the paragraph would then read - . . and the Commissioner shall make such alterations in the amount of tax payable. . . .
– I accept that amendment.
Amendment agreed to.
.- This clause provides for the reference of certain matters to a board of taxation officers. That board may make concessions to land-owners by way of refunds of taxation or by exempting taxpayers who are subjected to hardship. That has always been in theprincipal act, and it is a very proper provision, but this clause embodies an important amendment, and I would like to be sure that I have inter preted it correctly. Hitherto a taxpayer could go before the Hardship Board and plead hardship. If the board considered that the case warranted relief it would exempt the taxpayer. I gather from this amendment that a man may own a number of properties returning him, say, £100,000 a year in the aggregate. If one of those properties showed a loss and all the others a substantial profit this amendment would exempt that one proproperty from taxation. How could that land-owner be deemed to be suffering a hardship, in view of his aggregate profit? The amendment merely takes. away the discretionary power of making refunds that was previously in the hands of the board.
– A man may have a valuable city property, and at the same time be engaged in primary production. The city property may be showing a splendid profit, yet the country property shows a loss. It is our desire to encourage the man on the land, and that man would receive a remission of tax for the loss sustained on his country property.
– I submit thatthe board had power to consider such a case under the provisions of the act as it previously stood. Now the matter is made arbitrary. The board is denied the discretionary power to decide cases such as I have mentioned. The matter should be decided on its merits, but I fail to see why a man, who is making big profits on his aggregation of properties, should be granted a remission of tax because he may be losing on one property.
– The object of the amending clause is, when estimating land tax, to deal separately with each portion of land held by a land-owner and used for the purpose of primary production. If it is found that one property, by reason of droughts or other adverse climatic conditions over which the owner has no control, is not productive, that property is taken out of account by the Relief Board. It was understood by many that that was the correct interpretation of the section of the principal act, which refers to the subject, but the Hardship Board held that if a man has a city property and a pastoral property, andhe makes profits from the city property and loses on the other because of adverse climatic conditions, his position could not necessarily be regarded as one of hardship under the provisions of the act. The Government feels that, in the case of country lands, the land tax is really paid out of the income derived. In those cases where no income is derived, as the result of conditions over which the landowner has no control, it is considered that there should be relief from tax for that year on that parcel of land. It is felt that the present amendment deals with the matter on an equitable basis. .
– If a man has ten pastoral properties, nine of which are highly successful from a financial point of view, and one that is being worked at a loss through adverse climatic conditions, the Hardship Board will be compelled, by this clause, to regard that one property as a separate entity.
– Yes. That property which provides no revenue is exempt in effect.
– Are not periodic droughts considered when assessing properties for land tax purposes?
– It is felt that if no income is received from a property, it would be unfair to subject it to a land tax, and that this amendment is necessary (to clarify the position and to place it on an equitable basis.
Clause also consequentially amended, and as amended agreed to.
Clauses 28 to 30 agreed to.
– I move -
That the bill be now read a second time.
The object of this bill is to ratify the reduced rate of taxation which the Government has decided to impose. The whole subject was fully discussed during the debates on the Land Tax Assessment Bill and the budget, consequently I shall merely formally move the motion.
– I agree with the Treasurer that we have already debated this subject. Honorable members of the Labour party have voiced their protest against the Government’s proposals, and have recorded their votes on the assessment bill, and we shall leave it at that.
Question resolved in the affirmative.
Bill read a second time, and passed through its remaining stages without amendment or debate.
Bill returned from the Senate, without request.
Debate resumed from the 17 th November (vide page 1565) on motion by Mr. Bruce -
That the bill be now read a second time.
.- . The object of this bill is to ratify a new agreement between the Commonwealth Government and Amalgamated Wireless Limited. The Labour party objects to this agreement, as it has objected to previous agreements between the Government and the company upon a number of grounds. One of our objections has been partly met by the flight of time. When the first agreement was submitted to this Parlia-ment for ratification, we contended^ that insufficient scientific data wasavailable to justify Amalgamated Wireless Australasia Limited undertaking to supply the promised service. Our second objection was and is on the much more important ground that wireless is pre-eminently a national matter from all points of view, but particularly from those of the Department “of the PostmasterGeneral and” the Department of Defence. Our third major objection was, and still is, that this company is part of a foreign trust. Although the Commonwealth is represented upon the directorate of the Australian organization, the business is controlled mainly by the manag-ing director, who has evinced no conception of national service whatever, but merely an insatiable appetite for making extortionate demands upon every branch of industry which requires wireless service by virtue of patent rights acquired, if, indeed, they were acquired at all, for merely nominal sums and resting upon a doubtful, if any, title. I am indebted to the Prime Minister for the historical survey of this business which he made when introducing the bill. I admit that it was necessary for him to delve into somewhat ancient history in consequence of the span of time since Amalgamated Wireless Limited first undertook to provide this service. But the right honorable gentleman omitted some important facts from his survey. He might’ have mentioned that, in introducing the first wireless Agreement bill into this Parliament in 192.1 the right honorable member for
North Sydney, when Prime Minister, referred in glowing terms to our buying into a profitable business at par. Since then the present Prime Minister has introduced one budget, and the Treasurer of the present Government has made the pardonable boast that he has introduced five in succession. I regret to say that I have been unable to discover in any one of those six budgets a single reference to any dividend which the Government has drawn out of this profitable business. I certainly would not argue that, therefore, our partnership in the business was unjustified, since I look upon the provision of wireless as a national service, and not one intended to make profits for either the Commonwealth or private shareholders. But I would have thought that from the point of view of private enterprise, whose sponsors are so eloquent iri this chamber, the fact that after the expiration of six years no dividends had been drawn, would be regarded as worthy of mention. The Prime Minister might also have mentioned that the present Leader of the Opposition moved, as an amendment to the motion for the second reading of the 1921 bill, that the whole question of wireless should be referred to a committee of - the House for investigation and report. At that time the right honorable gentleman was a comparatively new member of the Federal Parliament, and with that modesty which sometimes, but by no means always, accompanies immaturity, he refrained from participating in the debate, although he made some pointed interjections in defence of Sir Rufus Isaacs, and with the loyalty which he has always displayed to his party and, up to a certain point, (o his former leader, he voted with the majority against the amendment. For that the right honorable gentleman to some extent made amends, because he was nominated for, and sat upon, the parliamentary committee that inquired into this matter, and, I grant, gave distinguished service as a member of the committee. Afterwards, he subscribed his name to a report which was in its very nature a stern condemnation of the agreement as originally drawn and presented by the then Prime Minister. Incidentally, it was a public declaration that the Leader of the Opposition was right, and that he himself had been entirely wrong in the attitude he had taken up. The right honorable gentleman might have made further amends for his original mistake; but politics sometimes weaves strange complications, and, shortly after his acceptance of the position of chairman of the parliamentary committee, he also accepted the much more onerous one of Treasurer of ‘ the Commonwealth. Well, it was a very embarrassing situation for him. I do not say for a moment that the offer of a treasurership, or its acceptance, would have prevented the Prime Minister from doing his full duty as a member of that committee ; but I point out that it was an embarrassing situation, and it would have been exceedingly difficult, and, I think, quite an unprecedented course of action, for a new-made Treasurer to completely reverse the policy of the Cabinet that he was just joining, thereby destroying the dearest dream of his leader the Prime Minister, who had just made him Treasurer. We cannot be quite sure, therefore, whether, when the Prime Minister signed the report, we had his absolutely definite and mature judgment upon this very important subject, free altogether from the influences of party ties, and more especially from the ties of Cabinet imposed upon him by his recent appointment to the Treasurership. In reviewing history, too, we should not leave out of consideration the present Treasurer (Dr. Earle Page). He was not then Treasurer. He was a member of a critical party, and as the right honorable member for North Sydney has so well pointed out, at various times, he never lost an opportunity to criticise. His view was that the matter would be much more satisfactorily handled from every point of view by private enterprise, unhampered, than by what he described as “ any half-bred company that we could form.” I am grateful to the Treasurer for having supplemented my inadequate vocabulary by the use of those words. I, myself, in a more crude way, had referred to that form of mongrel socialism, by which the Prime Minister and those who thought with him, were disposed to make themselves socialists in the investment of public money, and individualists in the distribution and collection of profits and dividends. The Treasurer, then Leader of the Country party, said, “I would much prefer an arrangement under which the Commonwealth was left out as a partner.” Well, he has had many opportunities since he made that public declaration of repeating it, and re-stating the’ arguments in support of it; but he has. never embraced those opportunities. I have no doubt whatever that he does wish to see the Commonwealth left out of this business. I, in turn, want the company left out of it, and I have no doubt, either, that the present Prime Minister is endeavouring to the best of his ability to hold the scales of his divided allegiance perfectly fairly between public requirements on the one hand and private enterprise on the other. The march of history is such that we must not entirely neglect the present Minister for Home and Territories (Mr. Marr). That he should be noticed in this debate is simply an endorsement of the truth that greatness must bear its penalty. He made a contribution to the debate, and one sentence of it was that, if the control of wireless were in the hands of a company, “wireless would.be boosted, arid placards would be posted inviting the public to use wireless.” Well, it is very probable that the present Minister is quite right. It may be, as Wells says, that the sense of justice to himself is stronger in man than the sense of service to the State. But, oh ! the pathos of it ! Wells might have said, with equal truth, that the sense of gain to himself is stronger in man than the sense of service. We have known men to fight and die for an ideal as men fought and died for this country. We have known men, both in peace and war, ready to “scorn delights and live laborious days “ in the pursuit of an ideal. But it seems to be accepted by this Government that any act, if only tainted with the ideal of public service, is bound to be a failure, and this, too, in the. face of the record we have of the great body of public servants, who, in one domain or another, have made names for themselves and adorned the Commonwealth in doing the work that comes to their hands, not entirely without self-interest but for fitting emoluments, yet, still, with a sense of loyalty to the State that they serve. One would judge, however, from the views so strongly put by the members of the Government that the greatest national effort must necessarily flow> if it is to have any origin at all, from the basest motives of profit and self-interest. What more need be said in answer to such a view of public affairs and public duties than was said by the honorable member for East Sydney (Mr. West) in his bluff way, when he remarked, “ If there is one national service which, more than another, should be controlled by governments, it is wireless.” And he was right. Continuing the history that .the right honorable gentleman developed, it is more remarkable, perhaps, for what it omits than for what it states. It speaks of the wisdom manifested by the right honorable member for North Sydney ; it speaks of what he regarded as the ‘ folly of the British Government in discouraging him and others, more particularly foreigners, from erecting wireless stations in the heart of England. As to the wisdom of the right honorable gentleman - and. we all know he has displayed wisdom of a high degree in many activities - it was displayed by the fact that he came down to Parliament asking its acceptance of an agreement, which absolutely handed over the Commonwealth to the company, an agreement which, having been considered by an independent committee, of which his Treasurer was one, was condemned lock, stock and barrel as unacceptable! As to the folly of the British Government, it is rather curious that we should be called upon to pass judgment upon the Mother of Parliaments ; but its main fault seems to have been that it has shown lack of judgment in the fact that it has always stood sturdily - not only the present Government, not only the Labour and Liberal Governments, but every colour of Government in Great Britain - and L venture to say wisely and certainly strongly, against allowing any foreign influence to gain control in the heart of the Empire of this great national service of wireless communication. From these beginnings, the Prime Minister proceeded with the various amendments, indemnities, extensions and modifications of the original agreement, all of which were required at the instance of the company itself, and all of which represented the surrender in one degree or another of the Commonwealth’s rights and interests. The agreement of 1924 was to be, read in conjunction with the original agreement. As a matter of fact, as I have already pointed out in former debates, it really relieved the company of the consequences of breaches of its own contract. I invite honorable members to make themselves familiar with these agreements, because they are not complicated, and are not very long. The second recital in the preamble of the agreement of 1924, which modifies, in the interests of the company,- the original agreement, reads -
And whereas at the time of the making of the principal agreement the parties thereto believed that the British Government would be ready and willing to grant licences for the erection and operation of a trunk station and other stations in the United Kingdom for communication with Australia. And whereas the British Government refuses to grant licences for the erection and operation of commercial wireless stations in the United Kingdom, with a view to communication with Australia, and the Marconi Company is by reason thereof unable to obtain the necessary licence to erect or operate the said trunk station in the United Kingdom for that purpose.
I have already dealt with that allegation in a speech that I delivered in the lineal predecessor of this Parliament in Melbourne on the 2nd September, 1924. I think that a paragraph from that speech will bear repetition -
Honorable members will notice that the basis of the company’s application to be relieved from its obligations under the principal agreement, and to hn.ve a fresh agreement, giving it a new lease of life, to enable it to undertake fresh experiments, and obtain, if possible, dividends, is that it understood that it would be granted a licence to erect trunk and other stations in Great Britain, and that those expectations were not realized.
It will be seen that no steps were taken at that time to ascertain whether we could get permission to erect such a station; but upon that point, as upon others, the word of the managing director of Amalgamated Wireless was accepted as gospel, which, indeed, it was not. But although that prospect was recited in the agreement, and alleged therein to be one of the main reasons for it, the Prime Minister had shifted ground and declared that the beam system had revolutionized wireless, and that that was the reason for the new agreement. As to that also, I supplied an answer at the time, pointing out that long before the original agreement of 1922 was entered into, Marconi had applied for a patent in connexion with the beam system, and the application had been rejected on the ground that the system lacked novelty. Even at that time there was nothing novel in it. Theoretically the beam system is not different from any other system of wireless, except that by the use of a shorter wave length, requiring lower power and a less expensive station, it can be operated on more economical lines. But if the beam system was a revolution yi wireless, as the right honorable gentleman said it was, it still further justifies my attitude in 1922, when I said that there was no scientific data, upon which the contract could be made, to justify the belief that the promised service would be rendered, seeing that the high power service then contemplated was to cost three times more than the amount required for the beam.
– -Did not the honorable member predict the failure of the beam system ?
– I have never predicted the failure of anything in connexion with wireless, and I challenge the honorable member to quote any justification for his interjection. It is true that I have quoted the opinion of naval and other authorities that it would probably have severe limitations which would make it unsuitable for naval purposes, and that its effective use is restricted within certain limited hours. I mentioned those difficulties and limitations as they presented themselves to expert minds at that time; but I have never predicted the failure of wireless in any of its activities. On the contrary I have prophesied for it the fullest measure of success. I believe we are now only on the threshold of the tremendous developments that will come from the exploitation of the ether. To the scope of this wonderful scientific discovery no sane man would think it wise to place any limits.
In the modified agreement of 1924 the company again undertook to do what it had already undertaken and failed to do, over a number of years, namely, to supply a certain service; the number of words to be transmitted was set out in the agreement. That was in 1924; it is now 1927, and it is sufficient to say that long after the expiration of the prescribed time a service is at last in existence. It is much too soon to say whether over an extended period - a year is the period described in the agreement itself - the service can be maintained satisfactorily, and can commercially supplant communication by cable. My own opinion is that it can; but in these matters I do not venture to pit my opinion against that of experts. At this stage I merely point out that if the Commonwealth had never been harnessed to this company, which has done so much to harass and impede the operations of commerce and industry in Australia, connected with wireless there would be nothing whatever to prevent the Commonwealth from erecting a beam station at the moderate cost of £150,000 or less to set up direct communication between Australia and Great Britain. The imperial authorities would have been entirely in sympathy with such a move, controlling as they do a beam station in England, and standing for national control, and our people would have retained in their possession a great national service just as they retain the postal services, and control every other service which is essential to the convenience and safety of the nation.
I turn now to the report of the royal commission which was appointed by this Government. May I modestly remind honorable members that, I, as spokesman for the Labour party, moved for the appointment of a royal commission, and urged very strong reasons therefor. ‘ Needless to say the Government, led by the present Prime Minister, could see no force in my contention, and lightly brushed the request of the Opposition aside. But time was with us, and other influences were at work besides those which were being mobilized from this side of the chamber. A good deal of mystery attaches to the appointment of that royal commission. The Prime Minister went out of his way to declare that the appointment was not on account of anything I had said, and one wonders why the Government changed its mind. I can suggest a reason: Private enterprise had got busy; private enterprise, which is the spoiled darling of this Government, had pointed out that traders, manufacturers, listeners-in, and every branch of trade and industry connected with wireless was being hampered and impeded by the company to which the Government is wedded. Those people insisted upon the appointment of a royal commission to inquire into wireless, and the Government, which listens lightly and even impatiently to representations from this side of the House, turned an intent and anxious ear to the representations 6f private enterprise. A com: mission was appointed; it was a body of disinterested and able men, representative of several States of the Commonwealth, who after touring Australia, furnished an elaborate and informative report in almost record time, but of its recommendations, not one has been adopted in toto by the .Government. The Prime Minister was at some pains to show that one of his own decisions had been influenced to some extent by the recommendation of the Commission. However, following upon, if not arising out of the report of the royal commission, conies a new agreement and a new bill. That nev.’ agreement makes further great concessions to the Amalgamated Wireless Company at the expense of the Commonwealth, and affords no safeguards whatever against the exactions of the company upon trade and industry, although the right honorable gentleman endeavoured to show that it does. He mentioned three matters as being of paramount importance - the payment of terminal rates, the establishment of coastal stations, and royalties.
The terminal rates are apparently charges for the delivery and local distribution of messages received at the main station in the Commonwealth. The right honorable gentleman told the House that the legal advisors of the Government had declared that, the Commonwealth was entitled to collect these payments from the company; he quoted a section of the original agreement upon that point, arid added that such payments were imperative by virtue of international conventions. He went on to say that a great deal o’f legal disputation had arisen upon the subject, and added, somewhat lamely, that rather than delay the inauguration of the service the Government had determined to make certain concessions - very substantial ones, as I shall show - to the. company to induce it to pay what the legal advisers of the Government declared it had to pay - an obligation, moreover that was imperative according to international conventions relating to the subject. He stated that the actual amount to be held in abeyance would be about £25,000, pending arbitration. That represents the terminal charges from April of the present year, when the service was inaugurated up to date. He added that on a basis of 9,000,000 words per annum, which is estimated as about the likely average traffic, we should receive in the future £45,000 a year in respect of these terminal charges, and then he added that, in exchange for this payment, certain concessions are to be made to the company in regard to coastal stations. I pause here to ask why any further concessions were made’ to this company, merely because the company puts a gun to the head of this Government ? When will the time come when the Government will have the necessary lime in the spine to stand up to demands of this kind, and say, “ That is the advice of our law officers, and we have resources enough to get the best advice. That is the position from the international and legal stand-points, and if you are not satisfied with it. you can lump it?” That is the language which the Government would probably apply if it were defending its own interests, but when it is defending the people’s interest, for whom it is the trustee, it weakly gives way because it says that it might delay the inauguration of the service if it did not make these concessions. I come, therefore, in a natural way to these coastal services, in respect of which these concessions have been made to Amalgamated Wireless Australasia Limited, and we shall see just what concessions have been made to the company, and with what a measure of contempt this Government has treated the recommendations of the commission. Under the original agreement the coastal stations were to be taken over by the Government at a price agreed upon, and if the price could not be agreed upon, the matter was to go to arbitration. As a matter of fact, it did go to arbitration ; and I have always noticed that the Amalgamated Wireless Company agrees to nothing except on compulsion. The matter went to arbitration, and the price was fixed at £56,000. The method of payment was that the money should be paid over as the last instalment of capital payable by the original Amalgamated Wireless Company into the new company to bring it up to the required standard of £500,000. For the first three years the Commonwealth was to collect the revenue and bear the losses. The right honorable member for North Sydney said that the losses at the inauguration of the agreement were about £56,000 or £60,000 a year, and this, he added, was irrespective altogether of interest on the money and depreciation of plant. According to the present Prime Minister, he greatly overstated the amount, and I am afraid it was part of the brief which he held at the moment in order to make this proposition attractive to Parliament. According to the present Prime Minister, the loss was not more than £34,000 a year. I would ask him to consider this point which I am endeavouring to make. That £56,000 was to be paid over as the value fixed by arbitration for coastal stations. It was to be paid over by the original Amalgamated Wireless Company to the new company as the final instalment of capital, and the Commonwealth was to bear the loss for a period of three years, and was to draw the revenue for a period of three years. Now let us see what has happened. Those terms were very liberal; we were to bear the losses, which were immensely larger than the revenue, but we were at least to collect the revenue. The first thing that was done was that under an agreement entered into in 1924, it was agreed that the Commonwealth should shoulder the losses for a further year from the date of the agreement. If we turn to clause 12 of the agreement we find the present position as proposed by the new agreement -
As from 28th March, 1927, the Commonwealth shall pay to the company as a contribution towards the maintenance of the said stations an annual subsidy of £45,000 per annum, and the company shall pay to the Commonwealth thirty per centum of the revenue earned by the company in the continuance of the services which were carried on by the said stations at the commencemnt of the agreement made on the 28th day of March, 1922, between the parties to this agreement.
The Prime Minister states that this £45,000 is to be devoted towards the losses on these stations. I do not understand “ towards.” . At all events, it is either the losses or part of the losses. He states that the £45,000- which we have to pay the company is towards the losses on these stations, and he states that the sum of £34,000 is the average losses since the company took over. Thus the present position is that we are footing the whole of the losses, and are handing over the whole of the revenue, less 30 per cent., and handing over the difference between £45,000 and £34,000, namely £11,000. Therefore, the right honorable gentleman will see that, as a result of this new proposal, we are taking upon ourselves new burdens, and giving away old rights. I hoped that under new management there would no longer be any losses incurred by this profit-making company into which we have bought “ at par,” but, if there are losses, one wonders why we should make a new agreement so greatly to the prejudice of the Government compared with the company. In addition to that, the £56,000 which they were to put into the capital of the company in payment for the coastal stations is not to be paid as originally agreed; but, if you please, it is to be set off against the payments to be made by the Commonwealth to the company. It is hardly an exaggeration, therefore, to say that it is not to be paid at all. It is to be set off against a payment by the Commonwealth to the company, which we say should not be made. It would be quite a satisfactory method to set it off. if the payment we were making to the company was justifiable; but I have shown that it is not, and I have shown, also, that it is a grave departure from the terms of the agreement.
– Who will” be responsible for it?
– This Parliament will be responsible for it if it accepts the agreement. If we turn to the report of the Wireless Commission, we see at page 17 what is the view of the commission in regard to these coastal stations. The report of the commission is before honorable members now, and this is what it says, among other things, on the subject
The position has emerged that if the Commonwealth requires more efficient stations than the commercial interests of Amalgamated Wireless Australasia Limited justify, this increase of efficiency must be made at the expense of the Commonwealth to plant belonging to Amalgamated Wireless Australasia Limited, or by the erection of another plant exclusively for the use of the Commonwealth.
These land and coastal stations are intimately bound up with the other communication services of the Commonwealth, and, if controlled by the Postmaster-General’s- Department, greater use could be made of then in the less-populated parts of the country and in the Northern Territory. They would also assist in the communications between Tasmania and the mainland. The service rendered by these stations resembles in many respects the service performed by the telegraphic and telephonic branches of the PostmasterGeneral’s Department.
The interests of Amalgamated Wireless Australasia Limited are primarily commercial. The policy of the Postmaster-General’s Department is public service at the lowest cost.
At the present time there is nothing to ensure that these stations are manned by British subjects, or that the training of the personnel employed in these stations would harmonize with the training of the Defence Fordes of the Commonwealth or of the Royal Navy.
In the opinion of the commission there are overwhelming reasons why the land and coastal stations should be returned to Government control and linked up with the services of the Postmaster-General’s Department.
That is definite enough, and it is supported by further argument. But the Prime Minister says the recommendation cannot be accepted, and that it is undesirable to separate the two branches of the service. As to that, I say that, whatever may be said in regard to the separation of .the two branches - the overseas services and the local services - the recommendation of the commission is a strong endorsement of the attitude taken by this party in regard to national services as a whole. It is indeed a complete vindication. “We have sold the coastal services; but we are not to be paid for them. They pass to this company. When I say we are not paid, I mean that, under this agreement, further concessions are to be made to the company which practically, if not actually, wipe out the price to which we are entitled for the services which we have handed over. I say that this Government takes a great responsibility when it treats the recommendations of the commission so lightly as it has done, especially in regard to these coastal services. Honorable members on that side of the House have been pleased to say that the Opposition are developing a new interest in defence, and I suppose that I shall be twitted about my general interest in the subject. There never has been a time when, in my opinion, I have not been as sound and practical on Australian defence as any honorable member opposite - and probably a great deal more sound than they. The mere fact that I have not been prepared to follow these whirling patriots in their hysteria cannot be taken as proof that I am unmindful of the practical need for Australian defence along the lines approved by the Labour party.
I turn to the third subject, royalties. Royalties are dealt with very exhaustively by the commission. It is here that we have from the royal commission a complete endorsement of .everything that every honorable member on this side of the House has said with regard to Amalgamated Wireless. I shall read only a few passages from the report of the commission, although the whole of that report might well be read. At page 10 we find-
From the commencement of our inquiries the demands by Amalgamated Wireless Australasia Limited for patent royalties, both on broadcasting stations and on radio traders were a constant subject of discussion. The evidence disclosed that the operations of this company extended over every field of radio and in almost every instance have created friction and dissatisfaction.
At page 11 the report continues -
The conduct of the managing director in carrying out the powers entrusted to him -has created an atmosphere of hostility and distrust that has been manifested to the commission throughout the Commonwealth.
The conduct of the company with regard to patents claimed by it, has caused a bona-fide doubt in the minds of those interested as to whether the company itself regarded the patents owned by it as valid. The commission has refrained from entering into the question of the valadity of these patents, and has assumed for the purpose of this report that all patents claimed by Amalgamated Wireless Australasia Limited, are valid and enforceable.
Notwithstanding that traders were refusing to sign the licence form submitted by Amalgamated Wireless Australasia Limited, and that goods wore being sold in every city of Australia which were, according to the Managing Director of Amalgamated Wireless Australasia Limited, an infringement of patents held by his company, no steps were taken by the company to “protect its rights until quite recently, and the litigation commenced against Melbourne and Sydney firms, has been allowed to proceed in a leisurely fashion.
Showing; of course, that the company is more dependent on bluff than on any decision of the court, if it is ever given. The report continues -
In the meantime, the Parliament of the Dominion of New Zealand has passed legislation which was apparently .intended to invite Amalgamated Wireless (Australasia) Limited to a contest on the question of the valadity of the patents used in broadcasting stations. Evidence has been given that radio dealers in New Zealand are in some instances carrying on the sale of goods employing patents of which Amalgamated Wireless Australasia Limited claims to be the owner without any attempt on the part of that company to protect its rights. If Amalgamated Wireless Australasia Limited were in a position to commence litigation against residents of the Commonwealth in respect of infringements of its patents rights, it is difficult to understand why it was not equally prepared to defend its rights in New Zealand.
As ;t result of the company’s acts and omissions, the company is regarded with suspicion, and its business methods disapproved throughout Australia. Its own selling agent in Western Australia, said, “ I know that Amalgamated Wireless Australasia Limited is undoubtedly the worst hated firm in Australia.”
Not only has the company made demands on radio dealers, which, in the opinion of the commission are excessive, but they have sought to impose terms and conditions in their licences which are oppressive and unfair.
At page 3 2 it reads -
There i3 no doubt, in the opinion of the commissioners that the conduct of the company in relation to its patent rights has been high-handed and overbearing.
That is the description of the company by a -body of disinterested and able men, whose business it was to inquire into the subject. As the honorable member for Maribyrnong interjected, this is the company to which the Commonwealth Government is wedded. This agreement which we are now asked to adopt harnesses the Commonwealth Go- vernment to a company whose whole outlook on the question, of trade and commerce iri its relation to the Commonwealth services is penurious and grasping and altogether lacking in the civic sense. It is on behalf of this company that the right honorable gentleman. has appointed himself spruicker and apologist. It is pathetic to see the right honorable gentleman with this brief in his hands, the very language of which, I suggest, was compiled by the managing director of Amalgamated Wireless. I detect his style. I see in it the style and method of the artful compiler of a prospectus of a wild-cat scheme. I do not suggest for an instant that the Prime Minister cannot make a speech of his own, and do it well, but I do suggest that, being an exceptionally busy man, and having long succumbed to the wiles of this company, he has adopted the very language of its managing director. In his long apologia, the right honorable gentleman used the words, “ The company has shown every desire to come to a fair arrangement.” This company, scorched by the damning indictment made against it, and upon which it was impeached before this commission and before the public; held up to public exhibition as the worst hated firm in Australia, placed upon its trial again before this higher tribunal, the Commonwealth Parliament, is claimed by the right honorable gentleman to have “ shown a desire to come to a fair arrangement!” Does any honorable member think that, in the circumstances, the company would not desire to come to an apparently fair arrangement, or at least to pretend to do so. But it has not come to a fair arrangement. The company, under this agreement, waives certain royalties for a period of five years. A great deal more than five years has gone by since this Government first undertook to supply this service to the public; and considerably more than five years passed before a single message was* sent. But that is a detail. There is a royalty of 5s. on every listener-in to an “ A “ class broadcasting station. The Prime Minister says that the company, by foregoing those royalties on 250,000 listeners-in sacrifices £62,000 per annum. The right honorable gentleman said, further, that in foregoing a royalty of 12s. 6d. per valve on 25,000 four-valve sets, the company is giving up another £62,000. He adds a further 1,000 in respect of the “B “ class stations, so bringing the amount up to the magnificent total of £126,000. That would be a generous benefaction if there was not another side to the picture. Let me state the other side. It is that the company will receive from the Government, or from the taxpayers, 3s. each per annum on 250,000 listeners-in. That amounts to £37,000. Personally, I would not give the company one brass farthing, nor do I think that they should receive anything out of the public revenue. When the Prime Minister stated that the number of listeners-in number 250,000, the honorable member for Maribyrnong (Mr. Fen ton) aptly interjected that that number is continually increasing. Through the courtesy of the Postmaster-General, I obtained the figures from the department at short notice. The following are the numbers of listeners-in since1922 : -
The managing director of Amalgamated Wireless Australasia Limited is not such a short-sighted gentleman that he does not see the probability of almost certain increases in the number of listeners-in during the next few years. The £37,000 which the company now receives, on the basis of 250,000 listeners-in, will probably be doubled within the next couple of years. The number has increased by 7,000 since the Prime Minister gave his figures. And that is not the end of the story. The commission held in effect that a royalty of 12s. 6d. per valve on 25,000 four-valve sets was unjust and highly extortionate, and said that the amount should be5s. It also hold that the royalty payable by “A” class stations should be 2s. instead of 5s., the amount charged. In each of these departments of industry therefore the company levied at least £37,000 too much in a single year, and, calculated over a series of say four years, not less than £200,000 in excess of the just amount, and to which amount the company has no moral and a very doubtful legal claim. I think that disposes of the claim that Amalgamated Wireless Australasia Limited is playing the part of a generous benefactor, even under the . lash of public criticism to which it has been subjected. Here the right honorable gentleman is seen at his best, for he skips the difficulties and exaggerates the trifles. In excusing the managing director of this company, he made declarations from which one might assume that everything that had been done to encourage wireless in Australia since 1922 originated in the fount of wisdom of this enterprising company, whereas, in truth and in fact, it has done more than any other organization, person, or thing to hamper wireless development. The commission urged that the company should reduce its royalties, and define its claim to make them, or that the Commonwealth should exercise its power to take over all the private shares in it. With words of courage and wisdom the commission also urged the Government in that contingency to challenge the company, as the New Zealand Government has done, to prove its claims, but the challenge has not been accepted. The Government has merely requested the company to proceed to obtain a decision of the court. Sub-clause 1 of clause 11 of the agreement reads -
The company agrees to prosecute as expeditiously as possible to judgment the actions which have already been instituted by it in Australia for infringement of patent rights, which actions it is agreed are for infringement of patent rights substantially important in connexion with wireless broadcasting.
That is consistent with the fraternal spirit of the company. It is already engaged in litigation on a variety of issues in several States, but it only pursues its leisurely and litigious way when it is challenged to prove its power to make its exactions. Sub-clause 2 of the clause reads -
The company agrees that, unless within twelve months from the commencement of this agreement, judgment in its favour (otherwise than by consent) is given by the court of final resort upon the issues raised prior to the date of this agreement by the pleadings in one or more of the actions referred to in sub-clause 1 of this clause, it will, within the aforesaid period of twelve months commence an action or actions in New Zealand for infringement of the New Zealand equivalents of the Australian patents involved in the actions referred to in sub-clause 1 of this clause or other patents substantially important in connexion with wireless broadcasting, and will, unless and until there has been given in favour of the company in the Australian actions, such a judgment as is specified in this sub-clause, prosecute such action or actions as expeditiously as possible.
I do not quite understand how the company will carry out these undertakings. I cannot imagine that it will leave until almost the expiry of the twelve months the attempt to obtain a decision in the Australian courts, and then, if it fails to obtain one, dash to the New Zealand courts; but after all, that is a detail. The real absurdity of the thing is that instead of the Government taking the responsibility of challenging these apocryphal patents, it proposes to allow Amalgamated Wireless Australasia Limited another twelve months to prove its case, and if it does not within that period obtain a decision here, to go to New Zealand to get one. The Prime Minister has said that if judgments favorable to Amalgamated Wireless Australasia Limited are not obtained, the agreement will be terminated. I can see no justification whatever for such a statement. The only thing that will be terminated will be this part of the agreement. The remainder of it will still operate and presumably no one will be compensated for imposts unjustly levied. The agreement contains no provision for its definite termination. I have dealt with only a few aspects of this important matter, and to do even, that I have had to obtain the indulgence of the House for an extension of time. “ I do not intend tq discuss the matter any further at the moment. The reasons which caused the Labour party to oppose the ratification of the first agreement between the Government and Amalgamated Wireless Australasia Limited are as cogent, and, in some respects, even more cogent, to-day than in 1922. Certain rights which we had under the 1924 agreement are being given away under this agreement, and nothing is being obtained in return for them. This agreement will not guarantee to our traders, broadcasting companies and the community generally, any protection against the exactions of this company, and no reason has been advanced to justify us, as a Parliament, in following at its heels while it leisurely pursues in the courts the actions which it has instituted for the purpose of determining its insubstantial and doubtful claims. The Leader of the Opposition will officially declare the attitude of the Labour party to the bill ; but for my own part I shall oppose it. It is deplorable that we should be harnessed to this profit-hunting company and its speculative managing director. The Labour party stands for the national control of national services. I should very much like to have heard the right honorable member for North Sydney (Mr. Hughes) in other days speak in defence of the nation’s right to control these services. Witnesses before the royal commission spoke of the necessity of such control from the point of view of national safety. Others satisfied the commission that it was essential that we should control at least our coastal services arid international communications, and that this company had no Australian outlook. The point of view of the navy was ably put by Commander Cresswell. One must deplore the narrow and grudging spirit in which the Minister for Home and Territories boasted of the advertisement and publicity, which this company would gain by a process of boosting and placarding. It is repugnant and obnoxious to every good Australian that this service is controlled by a private company which is concerned principally with making profit for its shareholders. I shall vote against the bill. After all, it is not principally a question of the extent to which our manufacturers and our “ A “ class and “B” class broadcasting stations have been subjected to extortionate exactions by the company. It is a far wider issue that we have to determine. I have abundant faith in the future of wireless. I believe that in a few years our means of communication by air will be developed to such an extent that even our postal services will become obsolete. Wireless will revolutionize human communications. I am sufficiently socialistic, and have such faith in social service and in the utilization of the best brains of the nation to promote it, that I protest strongly against wireless remaining in purely commercial hands.
– What will be the position if the agreement is not ratified?
– The existing agree- . ment will continue.
Mv. Fenton. - Unless the Government acquires the privately-held shares in the company.
– It has no intention of doing that. I hope that the bill will be rejected.
– The honorable member for Batman (Mr. Brennan) on this occasion, as on nearly every other on which he addresses the House, made an admirable speech from his point of view. His choice of language, his range of vocabulary and his flights of fancy enliven a debate, if they do not inform the minds of honorable members. The honorable member’s speech to-day was a pleasant interlude in a somewhat dreary Sahara of humdrum debate; but I am unable to congratulate him upon his logic. The gods in distributing gifts think that they have done enough when they give a man imagination and the power of speech, and pass him by with what some regard as the most precious gift of all. The honorable member said that he had dealt with only a few aspects of this question, and that is so. He has, therefore, left for me a task that is much too heavy for my poor strength, and, if I lag after him pantingly, though I hope not utterly in vain, and if I pass over some of his most polished phrases and choice illustrations, attribute it to the fact that one cannot in 40 minutes girdle the earth. The honorable member began his speech by deploring that we had linked ourselves to this company and that, though we had been told that this was an enterprise for which, if we invested our capital, we should reap a golden harvest, we find ourselves, after five years, without a cent, to show for the £500,000 of money which is our liability and the £350,000 which we have paid into the concern in hard cash. That is true; but when it was proposed that this enterprise should receive the support of the Commonwealth, it was not suggested that the motive was profit. It was put forward by me as a great national enterprise. The honorable member is the last man in the world, surely, to measure the success of a thing by mere profit. The greatest institutions in the world are not run -for profit. The post office itself, which, for a brief moment, has wormed itself into the honorable member’s favour, is not run at a profit. But, apart from this, the answer to the honorable gentleman is that it is not usual for any enterprise to show a return upon capital invested until its purpose has been consummated. What was the object for which the arrangement was made with Amalgamated Wireless Australasia Limited? It was to establish cheaper and more effective communication between Australia and Britain and between Australia and other parts of the Empire. It was not suggested primarily that it would bring us money, but great service. In any case, the beam service has only been lately completed, and it is too early yet to say whether we have embarked upon an unprofitable enterprise, measuring it even by that paltry standard - paltry from the honorable member’s stand- point - or whether it will prove profitable. As a matter of fact, very much of the trouble - I will not say with the honorable member, but with many others - is that after many years in the wilderness, this project is at length in sight of the promised land, and the prospect is very heartening. It has not yet made any profits; but I believe that it will. The honorable member was good enough to comment upon the reference made by the right honorable the Prime Minister to my own part in this enterprise, and to question the all too flattering allusion to myself. He said that, in his view, there was no evidence that in this matter I had shown vision or constructive ability, or any one of those attributes of statesmanship that were, no doubt, plentifully evident in those great men whose names, unfortunately, he did not mention, but to which this Commonwealth owes so much. All the gentlemen on whom the honorable member scattered flowers of eulogy are anonymous, or dead! He said that we had handed the Commonwealth over to the company. But what are the facts? To men of Celtic temperament, like the honorable member and myself, facts are disturbing at times; but they must be faced. One great outstanding fact in Australian commercial and national life is its isolation, its remoteness from the markets of the world. Then, in our political circumstances, the dominant fact is that we are a part of the Empire, and communication between different parts of the Empire is essenti.il if this great political and national experiment can continue to operate much longer. Because it was desirable in the interests of the Empire, and of Australia, for its economic and commercial prosperity, that we should have closer communication with the outside world, particularly with Great Britain and the other parts of the British Empire, this scheme was agreed to by the House. Amalgamated Wireless Australasia Limited is a mere instrument by which the Government gave effect to a great national policy. As a matter of fact, there was no alternative . for those . who believed that better communication was desirable. There was no alternative than to endeavour to make some practicable and, if possible, profitable arrangement with the company. This we did and in the doing of it, the interests of the Commonwealth were amply safeguarded, because Australia holds a majority of the company’s shares. I remind the honorable gentleman, who has said a good deal about the company - and I am not going to defend it - that he seems to have entirely overlooked the fact that the Commonwealth holds the majority of the shares, and must take its share of the responsibility for whatever the company has done. Whatever the company has done, the nation is particeps criminis. If the company has done wrong, we have done wrong by our apathy and by our neglect to exercise that control that properly belongs to us, and was given to us under the agreement.
I pass from that aspect of the matter, and come to the position as it now presents itself to us. The agreement introduced by the Prime Minister, which the House is asked to approve, raises all those questions about and around which the honorable gentleman has been moving this afternoon. Before passing on to consider whether the object for which the principal agreement of 1922 was made has been achieved, perhaps I may say one word concerning the cable companies and the British Post Office. The honorable gentleman has fought a very brilliant fight this afternoon for the cable companies. He is convinced, so he says, that the British Post Office was in the right in insisting that the control of wireless should be vested entirely in its own hands. That is precisely the view that has always been held by the cable companies, in so far as they have ever been moved from the position that they have so long taken up, of opposing any effort from any quarter to establish a competitive system of communication. The honorable gentleman said that, no matter what Government was in power at the present time, they all stood for this great principle, which apparently is the cornerstone of the British Constitution - that the Post Office should control all means of communication, and that, under its wide-spread banner, we should find ourselves in the very van of progress. Let me tell the honorable gentleman that the British’ Post Office, along with the cable companies, has been a consistent opponent of every attempt to improve the cable service and of the greatest marvel of modern science, wireless. The cable companies, after opposing wireless for many years - they opposed it from the very moment when it was first hinted at - are now covering their heads with ashes, and suggesting that there should be some modus vivendi, some combination, some means whereby this cut-throat competition could be ended. The honorable member is now couching his lance for the cable companies; but let me tell him something about them. Perhaps the greatest antagonist of every scheme for improvement in the means of communication has been Sir John Denison Pender, who is the chairman of the Eastern Extension Telegraph Company. He is also chairman of the Eastern Extension Company and the London, Clapham, and Brazilian Telegraph Companies. With him on two or three of these companies sits Lord Inchcape. There are others; but these names will serve well enough. With the other companies, and directing their operations, are men who in every case are -directors of the companies of which Sir John Pender is chairman. In short these gentlemen controlled the cable ring. There never was, until the Pacific cable was laid any competition , for many years since it was laid there has been no effective competition. The beam service has altered everything. It is a live competitor. It has compelled a reduction of rates. The British Post Office has been the principal opponent of the project. Its attitude was the same in 1921 as it had been for twenty years previously. It was the same in 1921 as it was in 1851, and, if we live to 2001, it will be probably still the same. The main arguments used by the Opposition against the new service were that the laying of the Pacific cable was impossible; that if laid it could not be worked or maintained ; that if worked, it could not be properly employed ; that ii was unnecessary, and that Australian communication with the United Kingdom was sufficiently catered for by the Eastern Pacific route. After twenty years’ agitation by those in favour of the Pacific cable, they succeeded in overcoming the opposition. There then ensued an era in which the two cable corporations -carried on the communications of the British-speaking world. When wireless competition threatened them, they used the same arguments. But the beam is here in spite of them and their arguments now sound very poor and very hollow. I leave this subject with this passing observation, that I am not to be regarded as an antagonist of the British Post Office in its own sphere. I am content to say that its methods are not such as to commend themselves to men of vision who believe that the world of to-day has immense potentialities. The mind of the British Post Office is rivetted to the past. It seems incapable of adjusting itself to the present day and the circumstances of the age in which we live. Its opposition was bitter and persistent to the wireless proposal embodied in the 1922 agreement. Mr. Kelleway, who is now connected with the Marconi company, was then in the forefront of the offenders. I remember him telling me, along with the others gathered round him, that this scheme was impracticable, and that wireless telephony and those other developments, upon the very threshhold of which we now stand to-day, were the dreams of wild visionaries. Before the breath is cold out of the mouths of these great men, the relay system - adopted unanimously, except by myself - was proved to be inefficient, and not one word has been said in its favour from that day to this. I say nothing in reply to the honorable member for Batman that can be one-half as effective as a mere recital of the bare facts. The purpose for which this scheme was entered into in 1922 has now been achieved. We are in close touch with Great Britain, and in closer touch with other parts of the world. When the Canadian system is operating all America will be open to us. We have our goods to sell, and the more we advertise Australia and its possibilities - and those are tremendous - the more we tell the truth about ourselves, the better business we shall be able to do. The more we learn about the world outside, the better we shall be able to adjust ourselves to its circumstances, and not live like men with their heads in the sand thinking that there is no world outside of our own gates. No step has been taken that is more calculated to bring about not only progress and happiness among mankind, but also the peace of the world. Wireless brings the whole world in touch, it banishes isolation, in annihilates distance, it brings races sundered throughout the ages by fathomless oceans into close touch with one another. The whole world is becoming akin. I cannot understand the attitude of the honorable member for Batman towards this wireless scheme. The beam system has been crowned with success. Yet he has no feeling of natural elation at this great achievement of his native land, for in this great advanced movement, Australia has been in the very van, in fact, has been the banner bearer. The object of the 1922 agreement was to improve and cheapen communications. It was a part not only of a great Imperial scheme, but also of a great world scheme. Broadcasting, about which the honorable gentleman said a great deal, was merely incidental to this great purpose. We did not commit ourselves to an expenditure of £500,000 for broadcasting purposes. We wanted a service to enable us to communicate with the outside world. We have suffered all our lives from our remoteness. News trickles from here, in a pitiful stream to the press of Great Britain, and every Australian who happens to he in Great Britain, and reads the press, must feel hurt and disappointed that there is in it little or no mention of the country that means everything to him. Lithuania cuts a bigger figure in the British press than Australia. At any rate, some of the lesser countri.es of Europe, whose very names are unknown to us, figure as largely in the British news as does this great country. The beam system has put an end to that. It has enabled news to pass freely. Its object was to improve communications: to reduce rates. “We have a greatly improved service, and rates have been reduced. The honorable member for Batman did not say that as the result of the beam scheme the rates of communication have already been reduced from 3s. to 2s. a word. Until 1924 the full rate for messages was 3s., and for deferred messages, ls. 6d. a word. In 1926, when the shadow of beam wireless was beginning to make itself visible, full-rate messages were reduced to 2s. 6d., and deferred messages to ls. 3d. a word. In February last, a few weeks before the opening of the beam system, the full-rate messages were reduced to 2s., and deferred messages to ls. a word. The cable companies may say that the beam system has not been responsible for those reductions, and that they have made them from a philosophic desire to cheapen communications for the benefit of the people of Australia; but that contention would be absurd. The fact remains that for twenty years, until the Pacific cable was laid, the Eastern Extension Telegraph Company did not vary its rate at all. When the Pacific cable came into existence that company was forced to reduce ks rates, but no further alteration was made until the beam system was almost ready to start operations. Further, when one wishes to communicate with India at urgent rates, which are essential because of the difference in time, one will find that the rate has not been reduced, simply because there is no competition by the beam system. The object of this Parliament when it agreed to an arrangement with the Amalgamated Wireless Australasia Limited, was to establish cheap communication, and to bring the Empire closer. We have done, that, and a 11.the talk in the world will not alter the position. What does it matter if some one from Western Australia says that Amalgamated Wireless Australasia Limited is over-bearing and high-handed.
– They all say it.
– Supposing they do, what does it matter ? I am not imagining for one moment that Amalgamated Wireless Australia Limited is different from any other company; but this Parliament, which has 500,001 shares in the company, is just as responsible for its conduct as are the other shareholders. I do not admit that the action of the company has been anything but what honorable members themselves, if they were called upon to share in the actual management of the company, would approve. But for whatever it has done or not done the Commonwealth, as the holder of the majority of shares, is jointly responsible. We have seen that the beam system has resulted in improved and cheaper communications. In a little while we shall have communication with Canada, and that will still further benefit the people of this country. Let me now deal with the efficiency of the beam system. The agreement of 1922 provided for a capacity of 8,640,000 words per annum. In 1924 the amending agreement provided for a capacity of 12,960,000 words to England and Canada for 300 out of 365 days. The capacity of the beam system is actually 100,000,000 words per annum of an average of five letters per word. If we halve that, as is usual for traffic purposes, the total capacity is 50,000,000 words a year, while the contract called for only 12,960,000 words. We have been told that the beam system is not reliable because it is subject to fading, and that it is unsuitable for naval purposes. I shall deal with the naval aspect in a few moments. As to the efficiency of the system for ordinary commercial purposes the fact cannot be too widely known that this fading, which apparently is due to the sun’s rays falling across the path of the beam at certain hours at a certain angle and varies at different months of the year and at different times of the day, is very slight ; up to the end of September it affected only 1.4 per cent, of the messages transmitted, and during
October and November caused no trouble at all. That is to say, the messages were despatched immediately upon being lodged, and so expeditiously as to make it unnecessary to send them through the cable companies. The beam service has never been unable to despatch messages, but occasionally, owing to fading occurring during rush hours delays of four or five hours might have occurred. But this as I have said, affected only 1.4 per cent, of the messages up to the end of September, and none at all during October and November. The peak period for the traffic from Australia to the United Kingdom is between 6 p.m. and midnight, the messages despatched then reaching England in business hours. Fading that occurs within those limits is serious; fading during other hours is not, because no detriment to anybody results if the messages are delayed for a little while.
In regard to the use of the beam system for naval purposes, I speak without expert knowledge. Possibly, as naval men have declared, it will not be suitable for naval uses; but, as an ordinary layman, I cannot understand how any expert can be satisfied with cable communication. That system served us very well during the war, because the British Navy had command of the seas. The cables were safe because the ships of the Allies were able to police the seaways. Germany was compelled to fall back on wirless, and managed tolerable well even with the ordinary dissipated long wave. If Australia is ever seriously attacked, it will be by a power that has command of the sea. No force, unless led by a madman, would dream of attacking any country unless its communications were secure. The power that commands the sea commands the cables under the sea. What is easier than to drop a grapnel into the ocean, draw up the cable, and cut it? What more easy than to blow up one of the cable relay stations? But a wireless system is safe unless the country operating it is successfully invaded. If we cannot defend this country and hold our wireless station against the invader, we certainly shall not be able to hold the cables. Without trenching at all upon that sacred ground where experts move with so much certainty - and with such disastrous results - I venture to express the opinion that wireless is more likely to prove serviceable in time of war than are cables. At any rate, it will be a most useful auxiliary; it will be a stand-by. The enemy may cut the cables, but we shall still have the use of the air. Consider what wireless has done for those who go down to the sea in ships, and who from the beginning of the world until a few years ago moved in utter isolation. If they went to a watery grave, no one knew when, where, or how. Very often no news of their end trickled into the world beyond what might be inferred from a little debris, a life belt, or a boat with a name on it, washed upon a distant shore. But now there is not a ship in the world that cannot cry out to all the argosies that plough the ocean, “ Come to our aid,” and so far as human help is effective in those circumstances, men may cry by wireless for help from the middle of the Pacific or the Atlantic with more chance of success than one may call for a policeman in Canberra or in Bourke-street in certain hours.
The honorable member for Batman has not attempted to deny that the beam system is effective. He says that he has never predicted its failure, but that he had quoted on other occasions those who had done so. The honorable member took a very safe course, because in the event of the prediction proving incorrect, he would say, “I did not say that; I only quoted the opinion of my friends.” But I defy any one to deny that the honorable member for Batman conveyed the impression, not only that he believed the system would fail, but that he also hoped that it would.
The 1924 agreement provided for the erection of a wireless station at a cost not exceeding £120,000. The beam station has been erected for £91,000. I mention this to show that the management of Amalgamated Wireless Australasia Limited has been reasonably good and bears favourable comparison with that of any other company or even of this Government. The British post office, which had not committed itself to the clutches of such a vampire as Amalgamated Wireless Australasia Limited, built a similar station in England at a cost of £85,000. Having regard to the greater cost of labour in Australia, we should congratulate ourselves on the fact that the cost of the English station was only £6,000 less than that of our station. That is not the whole of the story. The British Government, which has not sold itself to Amalgamated Wireless Australasia Limited pays Marconi a royalty which at the present volume of traffic will amount to £80,000 in the next ten years. We may fairly expect ‘ that the traffic will eventually increase, and that the royalty will increase correspondingly. In other words, the British post office, which is free to act as it likes, is master of its own household, and has nothing to do with any company, has saddled itself with royalties amounting to £8,000 a year on the present volume of traffic and a much greater amount as the traffic develops. Compared with that transaction, the Commonwealth Government has done a very good piece of business with Amalgamated Wireless Australasia Limited, for the Australian station is at least as effective as that in England.
The bill proposes to substitute for the royalties which Amalgamated Wireless Australasia Limited is entitled to claim from the users of its inventions and patents, a payment to the company of 3s. per annum for each licence fee issued. When we ask ourselves whether that arrangement is fair, we have to consider what Amalgamated Wireless Australasia Limited has to sell. The honorable member for Batman has asked on what ground the company declared itself to be entitled to exact royalties from the community. That is a most amazing question to be put by a lawyer. The honorable member must be acquainted with the law relating to patents. H» must know that patent law3 exist to encourage inventions, and that if the world is what it is to-day, with electric light, wireless, internal combustion engines, and all the other wonders of science, we owe it to the inventors, and to no one else. The average man invents nothing. He leaves nothing behind him except debts and tribulation. It is the few who have made the world what it is. The things worth while in the world today represent the ideas of the few, and so it is essential, as any man will recognize who loves his fellow man, who wishes to see th.e world progress, and who wishes to give man more leisure, that we should re» ward the inventor for his labours. The whole question is, does Amalgamated Wireless Australasia Limited possess inventions that are valuable ? I shall tell you what it has. When it entered into the agreement with the Government, it stated, under its seal, that it had acquired in perpetuity the rights of the Marconi Company’s patents and inventions in esse and in future-; that is, what is has, and what it may have; also the right to use, manufacture and sell the inventions and patents that the Telefunken Company has or may have, and for a period of ten years, all the rights of the Radio Corporation and the rights of the Great French company that operates wireless in France. So that the Amalgamated Wireless Australasia Limited is, and has been’ able since 1922, to handle and place at the disposal of Australian companies all the inventions of all the great wireless inventors and companies of the world. Suppose the Amalgamated Wireless Australasia Limited had not acquired those patents. One of two things is obvious. Either we should have not been able to use any of these inventions, or we should have had to pay royalty to the inventors in other countries. We cannot us.e. a man’s brain and pay nothing for it. We have no right to ask Marconi, or the people behind the Telefunken Company, or any of those who have done so much to make the world a happier and better place to live in, to place the fruits of their life labours at our disposal and not pay them anything. The Amalgamated Wireless Australasia Limited have paid hard cash for these inventions.
– How much?
– The honorable member must give notice of that question.
– This commission tells us how much. It was £93,000. It is here in black and white.
– I say it has paid their value, or what was considered their value by the inventors.
– The amount is stated here.
– If it is there, what does the honorable member want to ask me for? It is not denied, that Amalgamated Wireless Australasia Limited lias made an arrangement with Marconi, with the Telefunken Company, with the Radio Corporation, and with the French companies, which places these inventions at its disposal, and it has a perfect right to charge royalties. On some of the inventions it pays royalties itself, because the terms upon which it acquired the inventions stipulate that royalties shall be paid. If we are going to use these inventions we must pay royalties for them. It is done everywhere. It is not as if it was done merely in the case of Amalgamated Wireless Australasia Limited. It is a common practice all over the civilized world. There are firms making diesel engines in this country under rights secured from abroad. Why should they pay royalty? Because if you were to abolish patents and the law of royalty, there would probably have been no Diesel engines. Why should people invent things for us to use if we do not pay them? The inventor has a right to be paid for his labour like other men. This company has paid its money; it has taken the risks to acquire these patents. Yet the honorable member has spoken of it as if were some kin.’! of of parasite. It is an Australian company, with Australian capital, with its technical, engineering, and manufacturing staffs all Australian. It employs SOO men, and pays over £200,000 a year in wages. As to what it has done, there are 150 wireless stations on board ships, and it has in nearly every case designed and made the installations, all of which it operates and owns. Nearly all the apparatus that is used by the -broadcasting companies has been made, and is being made, by this company. The apparatus that is used by the broadcasting companies has been made, and is being made by this company. The apparatus used by 2FC, 3RO, 4QG, and the stations in Perth and Adelaide has been designed, made and erected by this company, by Australian workmen, by Australian capital. It is admitted that Australia is in the very van of wireless progress. It has no reason to be ashamed df its position. We are a nation of only 6,000,000 people; but I should like the honorable member to tell me in what way even the United States of America excels us in this matter. At any rate, we -pioneered the beam system. The honorable member for Batman said there was nothing novel in the beam.’ There is nothing novel in anything. There is nothing novel in the steam turbine. The experiments of Hero of Alexandria more than 2,000 years ago were the forerunner of the turbine. He got a kettle, stuck a small windmill in front of the spout, and the steam from the kettle caused the vanes to revolve. That was the beginning of Parson’s turbine. But there is a world of difference between the two things. If there was nothing novel in this idea, how comes it that it was not applied before? The words I use, the ideas that come to me, all have been conceived before, yet there is something novel in the arrangement of them. I say that Amalgamated Wireless Australasia Limited, is deserving qf the -respect that . is properly due to an enterprise which has striven valiantly, not animated by a mere sordid desire to add to its profits. The honorable gentleman sneered at the company because it is a profitmaking concern; but not 50 minutes before he said that one of the reasons for condemning the agreement was that we were making no profits. Thu company made a profit until it linked up with us. It paid a dividend every year until, in an unfortunate moment, it looked upon a strange woman, and since then nothing has gone right with it. It paid a dividend every year until 1922, and since then it has paid none. It is quite a proper thing for royalties to be paid for use of inventions that are novel and useful Amalgamated Wireless Australasia Limited, in its earlier days, pioneered this industry, and it made possible that fruitful field in which many are now making a remunerative living. Amalgamated Wireless Australasia Limited pioneered this when the profits were very problematical. Therefore, the right of the company to royalties is undeniable. It is said that its charges were, excessive, that it was overbearing, and high-handed. The honorable member would have us believe that the charges to the users of its patents were exorbitant. What are the facts? We have heard a good deal about the practice of the British Post Office. The amount which the company charged was 12s. 6d. per valve socket, and the same price is paid to Marconi in. Great Britain by the trade without complaint. Therefore, it must he regarded as a fair thing. As to whether these rights are solid and substantial, that is an issue before .the court; but I ask honorable members to look .at the facts. Is- it probable that people would have been paying this royalty of 12s. 6d. for years in Great Britain, and not contest it, if it were considered unjust? Is it that Marconi and others like him are a lot of charlatans who never gave anything useful to the people? Are we to believe that the patent law, which considers the rights of the individual in these matters, would pass it by, and give no protection whatever to the public? This -royalty has been paid in this country as well, as in Britain, and has been paid by the heads of responsible firms in this country. The matter is before the court. If the court decides that the patents are not valid this part of the agreement lapses, and the position as it then will be comes before Parliament for reconsideration. But under this agreement now before the House Amalgamated Wireless Australasia Limited, though entitled to royalties, has commuted its- royalty rights for a payment of 3s. per listener-in. Upon the present number of “ A “ class stations, its royalties would amount to £60,000 a year, and, if it succeeded in the action it is instituting for the infringement of patent rights for receiving sets, it would be entitled to collect an additional £60,000 per annum. The position requires no elaboration by me. Under the new proposal valve sockets will not carry a royalty. This should reduce, prices and. encourage many more to use wireless. Australia now controls practically all the great wireless inventions in the world, and all these will be free to manufacturers, dealers, and users of radio. [Extension of time granted.] I come now to another point. At the time this agreement was made the Commonwealth Government was losing between £35,000 and £50,000 on its coastal stations. The company offered to take them over and manage them. It did so, and it made a loss. It cannot be expected to carry on business at a loss unless given some quid pro quo. It is per- fectly true that the company entered into an agreement, and, had we not disturbed the agreement, it would have been willing to abide by it. A difference of opinion exists as to whether the post office is entitled to demand terminal charges on the messages passed through its offices. The company, upon the advice of learned counsel, held that it is not liable to pay terminal charges, and that the PostmasterGeneral has no right to ask for such a payment. In order to settle the matter, which could otherwise be decided only by litigation, it has been mutually agreed to adopt a modus operandi, under which the company will receive £45,000 from the. Commonwealth Government as a set-off against its losses on the coastal stations. The company will waive its refusal to pay terminal charges. The Postal Department will receive 30 per cent, from the revenue derived from the coastal service, which is equivalent to about £12,000 a year, and which will increase with the coastal traffic. The company was entitled to a royalty of 12s. 6d. per valve, socket on approximately 25,000 four-valve sets. It will now forego that royalty, which is considered a proper charge, and which is the general practice in Gre:, t Britain. The Government has suggested that it shall pay 3s. for each licence that is issued to each holder of a receiving set, and that the company shall waive its right to collect royalty. In order that the Government may be protected, it is asking the company to press its claims in the court, so that it may establish the fact that it has patent rights which are valid and enforcible in a court of law. I am in favour of the proposed new agreement, and I hope that the House will approve of it.
I am satisfied that the beam service will achieve all that is hoped of it. I am only incidentally interested in broadcasting; but I am vitally interested in linking up this wide-flung Empire of ours. The beam wireless service will make easier the government of Empire. It will widen our opportunities to sell our goods overseas. It will make our resources better known. It will bring us into closer contact with our fellow peoples of the British Empire, and so will amply justify itself. In the very near future we shall obtain a satisfactory return for the capital invested in the venture, which should prove self supporting. We shall enjoy the solid satisfaction of having pioneered a great movement, which will link together the different parts of the Empire, ‘ and after years of labour and waiting, have our reward by reaping what we have sown.
.- We have just seen how ill at case an honorable member can be when endeavoring to build up a case that lacks substance and justification. The right honorable member for Worth Sydney (Mr. Hughes) was particularly uneasy when attempting to explain certain of the operations of Amalgamated Wireless Australasia Limited, and to justify this new agreement. In prefacing his remarks, he said that he was unable to congratulate the honorable member for Batman (Mr. Brennan) on his logic; that while the honorable member was responsible for many polished phrases and choice illustrations, and was very interesting, he was most unconvincing. I can at least commend the honorable member for Batman upon his consistency. I am afraid that I cannot offer similar commendation to the right honorable member for North Sydney. We must all recollect the attitude of the right honorable gentleman some years ago, when he asserted vigorously that the essential services of a country should remain within the control of the Government. Now the right honorable gentleman is prepared to champion the cause of this great wireless octopus! This is a complete volte face. Honorable members expected to hear some convincing fa.cts from the right honorable gentleman to counter those marshalled by the honorable member for Batman when presenting his argument. They were disappointed. The right honorable gentleman is a director of Amalgamated Wireless Australasia . Limited. His appointment to that position was made by the Government of which he was the leader. Consequently it is interesting, if not elevating, to find him trying to justify the company. Although he is a kind of fairy godfather to it, he will find it extremely difficult to justify his allegiance to it. I intend to challenge certain figures which the right honorable gentleman quoted. He said that the cost of the Australian beam station was £91,000, which could not be regarded as extravagant, seeing that the British Government paid £85,000 for a similar station. The British Postmaster-General, Mr. Hartshorne, has stated that the maximum price that would be paid for the British station was £44,920. That was an official declaration, so that I must ask for verification of the figure given by the right honorable member for North Sydney before I can accept it as authentic. Wireless is one of the great romances of scientific invention, but it is unfortunate that the development of it in Australia should have been left to private interests. Unhappily the complexity and intricacy, commercially and technically, of the system have given Amalgamated Wireless Australasia Limited an opportunity to fleece the public, of which it has taken every advantage. It has shown itself to be either unable or unwilling to carry out many of the obligations imposed upon it by the agreements which it has made with the Commonwealth Government from time to time, and is totally unworthy of the special patronage which it has received. The report of the Royal Commission on wireless affords us conclusive proof that the management of the company has been utterly incompetent, and that it is undesirable for the Government to allow it to continue. The company has shown a shocking disregard for the public interests, and the right honorable member for North Sydney and the Prime Minister were not justified in pleading for it. It has entwined its tentacles round every commercial and private concern which has need to use wireless communication, and has required them to pay exorbitant rates for the unsatisfactory service which it. has rendered. Its royalty claims for patents, to the use of which it has not proved its right, have been grossly unfair and exorbitant. The British Government has determined that this wonderful instrument of modern invention shall not be placed in the hands of private monopolies, such as Amalgamated Wireless Australasia Limited or the Marconi Company for exploitation in Great Britain. The right honorable member for North Sydney said that Australia was not dominated by Amalgamated, Wireless Australasia Limited, for the Commonwealth had a controlling interest in it. . He added, “ We are the masters, and if things are not right we are responsible.” If that is so, how is it that the company has consistently refused to pay terminal charges in respect of its messages to the Postmaster-General’s Department ? It has flouted the Government Department in respect of its obligations. How is it that the Government representatives on the directorate have not insisted upon these dues being paid? It is the company that manages, controls, and determines every phase of wireless in Australia. The claims of the Postmaster-General’s Department should be met promptly and honorably. The company has used its delinquency to force the Government to grant it even more generous conditions than it now enjoys, and it has succeeded to some extent, as this amended agreement shows. Wireless is unquestionably an essential public utility, and as such it should be controlled by the Postmaster-General’s Department, and not by Amalgamated Wireless Australasia Limited or any other private company. The honorable member for Batman has shown conclusively that Amalgamated Wireless Australasia Limited has deliberately disregarded its obligations, and the right honorable member for North Sydney did not rebut a single argument that he used, but made a speech which consisted wholly of a series of evasions. Even he was not able to hide the fact that in the last five years the company has blundered and plundered in a most remarkable way.
Sitting suspended from 6.S0 to 7.45 p.m.
– Ever since the advent of Amalgamated Wireless Australasia Limited, resentment has been expressed concerning its claims for royalty and its patent charges. Great difficulty was experienced in inducing the Government to bring about an investigation of the accusations levelled against the company,, because of the way it was hampering the legitimate operations of wireless enthusiasts and traders. The Prime Minister and the Postmaster-General were slow to realize the need for a royal commis sion. I have newspaper reports showing that they both expressed the opinion that the circumstances associated with wireless telegraphy in no way necessitated review by such a body. It was not until the Prime Minister had left for Great Britain that the Treasurer intimated that a royal commission would inquire into the subject. Honorable members should admit that the charges made have been more than justified by the report now before us. I regret that the agreement does not more strictly coincide with the recommendations of the commission, particularly with reference to coastal ‘ and land stations. Even the Director of Posts and Telegraphs’, Mr. Brown, is anxious that the Government should have complete control of wireless services. He has properly suggested that these and the other telegraphic services are interdependent and interwoven, and that the department has men capable of undertaking even the most intricate wireless work. Therefore, there seems to be an unsatisfactory duplication of services and an overlapping of control. The Defence authorities, too, are emphatic in their declaration that wireless should be under the direct control of the Commonwealth Government. The evidence given before the commission by Commander Cresswell and Admiral Napier proves that it is highly desirable, in the interests of the defence of Australia, that the Commonwealth should completely control wireless services as a public utility. Commander Cresswell disclosed that secret and confidential documents had found their way into the hands of Amalgamated Wireless Australasia Limited. The Prime Minister, speaking in this House, reproved Commander Cresswell for what he described as a breach of discretion on the part of that naval officer. But,” much to the surprise of the Prime Minister, on the following day Admiral Napier supported all that Commander Cresswell had said, and added that the evidence had been given under his direction. Then the Prime Minister admitted that he himself had been indiscreet in endeavouring to disparage the remarks of Commander Cresswell.
– He made a personal explanation, but not a very generous one. v
– Yes; the explanation was characteristic of the right honorable gentleman. The unanimous opinion of the Naval Board is that it is most desirable that our whole line of communications should be directly under the control of the Government, particularly because of the importance of wireless services from a defence point of view. The Director of Posts and Telegraphs also acquiesces in that view, and says that wireless services should be under the control of the Postal Department.
– “ Should “ or “could?”
– I do not think that it would be misrepresenting Mr. Brown to say “ should.” At any rate I shall quote his remarks shortly, and then the Minister may place his own interpretation upon them. The report of the commission completely vindicates the attitude consistently adopted by the Labour party on this matter. The honorable member for Batman (Mr. Brennan) and other honorable members on the opposite side have persistently taken the stand that the wireless services should be controlled exclusively by the Government. On page 17 of its report the commission states -
These land and coastal stations are intimately bound up with the other communication services of the Commonwealth, and, if controlled by the Postmaster-General’s Department, greater use could be made of them in the less-populated parts of the country and in the Northern Territory. They would also assist in the communications between Tasmania and the mainland.
Evidently we are not receiving as good a service as could be given if wireless communication were under Government supervision. No doubt, because of its desire for dividends, the company does not consider it desirable to provide isolated parts of the Commonwealth with these services. The report continues -
The service rendered by these stations resembles in many respects the service performed by the telegraphic and telephonic branches of the Postmaster-General’s Department.
No wonder that Mr. Brown emphasizes the importance of co-ordinating the telegraphic and telephonic branches with the wireless service. The PostmasterGeneral will find it difficult to reconcile the recommendations of the commission, with the agreement, when we find how closely the wireless service is associated with the most important activities of his own. department. The report continues - The interests of Amalgamated Wireless Australasia Limited are primarily commercial. The policy of the Postmaste General’s Department is public service at the lowest cost.
There, again, the report intimates that a more satisfactory class of service could be provided through the Postal Department than through a company that is actuated first and last by the desire to exploit the commercial possibilities of wireless telegraphy. The report substantiates the argument of the opposition that the various services should be coordinated and operated under Government supervision. It states -
At the present time there is nothing to ensure that these stations are manned by British subjects.
To-day the right honorable member for North Sydney (Mr. Hughes), is a theatrical display, endeavoured to persund:! the House that the company wasentirely an Australian concern. I challenge him on that assertion. The Marconi Trust has a very large interest in the company.
– Particularly with respect to the islands service.
– That is so. The agreement contains nothing that places the company under an obligation to engage British subjects in the working of this branch of our line of communication. The report goes on -
Or that the training of the personnel em ployed in these stations would harmonize with the training of the Defence Forces of the Commonwealth or of the Royal Navy.
No wonder the Naval Department takes exception to the present position. The commission further states -
In the opinion of the commission there arc overwhelming reasons why the land and coastal stations should bc returned to Government control and linked up with the services of the Postmaster-General’s Department.
That is a most definite recommendation. 1 assume that the members of the commission were carefully selected, and were men whose views were acceptable to the Government. That being so, the least that the Government should have done was to give effect to such a strong recommendation, supported as it was by the evidence of high departmental officers. But instead of taking over the coastal stations, the Government proposes to pay Amalgamated” Wireless Australasia Limiteda subsidy for operatingthem. The report continues-
The com mission is not unmindful of the fact that since March, 1926, the Commonwealth has been relieved of the annual loss sustained in the workings of most of these stations, From the information supplied by the company to the commission it would appear that the loss on the coastal radio stations amounts to, approximately, £25,000 annually.
The amount mentioned by the Prime Minister was £34,000. Although the commission says the loss was £25,000, the amount of the subsidy to be paid to the company is £45,000, or £20,000 in excess of the present annual loss. It is reasonable to expect that both land and coastal services will improve, and that with more modern plant and improved methods of working, the present annual deficits will be ultimately eliminated. That being so, there is no justification for the Government’s munificent offer of a clear contribution of £20,000 towards the profits of the company. I do not object to the payment of adequate remuneration of services rendered, but the proposed subsidy to Amalgamated Wireless Australasia Limited is extravagant and excessive. I believe that if the company were to modernize the stations, the increased earnings and economies would more than recompense it for any services it renders to the Commonwealth. The report said further -
The commission considers that it is vital to cbe intersts of the Commonwealth that a government department should resume control at the earliest possible opportunity.
The recommendation could not be more definite and emphatic; yet in complete disregard of it, the Government is continuing its wild and reckless policy of helping a private monopoly to gain a more through grip over a service that is vital to the life and. well-being of the Commonwealth. The right honorable member for North Sydney criticized the British Government for having, as he said, failed to keep pace with the progress of wireless science. He said that Australia had been the pioneer within the Empire in developing the beam system, and he condemned the British Government for not submitting to the dictates of the Marconi Trust, and giving that body control over wireless services in the United Kingdom. When the right honorable member said that the British wireless stations were obsolete he either spoke in ignorance, or made a statement which he knewto be incorrect. No wireless station in the world is more up to date and efficient than the government high-power plant at Rugby, and it serves the United Kingdom admirably. The naval authorities believe that the beam system is of less strategic value than the high-power system, and does not permit of the sending of messages to the ships of the navy as directly, secretly, and reliably as is necessary. The right honorable member misrepresented the attitude of the Naval Board when he said that the experts would make Australia dependent on cables which in time of war could easily be cut. The Navy Board advocates that the cable services shall be supplemented by high-power wireless stations which can work in unison with the wireless equipment on our own war vessels. The naval experts are not convinced of the efficiency of the beam system, and as the Imperial Navy relies upon a highpower station, the Naval Board is of opinion that Australia should follow that example, so that the naval and wireless services of the Empire may be completely co-ordinated. The outstanding feature of the right honorable gentleman’s speech was his oft-recurring reference to Empire progress, Empire communication, Empire interests; he exploited fully the sentiment that the word “Empire” implies. Yet the policy he is supporting is not in accord with that laid down at the seat of Empire in regard to wireless communication. Commander Creswell in his evidence said -
Wireless broadcasting in Australia was a public utility and it was inconceivable that any individual or corporation should be allowed to exercise a monopoly over broadcasting in the Commonwealth. After the meeting of the Imperial Communications Committee -
I emphasizethis statement - it was considered advisable to modernize certain wireless stations in Australia, and Amalgamated Wireless had been asked to supply details of its developmental policy. During the last twelve or eighteen months the Naval Board had experienced great difficulty in securing information from that particular company.
The position of wireless from a defence stand-point is very unsatisfactory, and I hope that even at this late hour the Government will adopt a more sane attitude in regard to a service that is essential to the safety of the nation.
If there is one thing more than another that Amalgamated “Wireless Australasia Limited has tried to press upon the Australian people, it is the claim for royalties in respect of patents, its legal or moral right to which is questionable. I am glad that at least one government has called the bluff of that corporation, and will protect the people against its exorbitant demands. The New Zealand Government, which is equally as conservative as the present Commonwealth Government - it certainly is not a Labour Government - has dealt with the position firmly. It has stood between the people and the combine and said, “We challenge your right to make these demands upon our people for royalties in respect of wireless patents.” If Amalgamated Wireless Australasia Limited is convinced of its legal claim to those fees, let it take up the gauntlet thrown down by the Dominion Government. Whilst the New Zealand Government is thus protecting its people against exploitation by a private corporation, the Commonwealth Government enters into partnership with it and shares in its ill-gotten gains. In view of the unenviable record of Amalgamated Wireless Australasia Limited, and its exorbitant charges upon those connected with radio, this Government should certainly follow the example of the New Zealand Government, so that the people may bo protected from that company’s depredations. Dealing with the question of royalties and patents, I shall give an instance of the pressure that is placed upon persons and associated bodies interested in wireless, and also of the manner in which a Government department gives special assistance to this Amalgamated Wireless monopoly by granting or withholding of licences or permits. Mr. Brown, the manager of Central Broadcasters, when giving ‘ evidence before the Royal Commission on Wireless, said: -
Central Broadcasters was incorporated on 4th November, 1924, and in the same month the directors entered into a contract with the Associated Radio Company of Melbourne, 3AR for the supply of a 5 k.w. transmitter. About this time repeated applications were made to the Portmaster-General’s Department for _ the promised “A” class Hoodoo, -without which the company could not go to. the public for capital. The Postmaster-General refused to issue a licence, on the ground that he could not agree to the transmitter being manufactured by the Associated Radio Company. To overcome these objections, the Associated Radio Company negotiated with Radio Communication Company of England for the purchase of a transmitter for 5CL, but required from that company an indemnity against prosecution by Amalgamated Wireless (Australasia) Limited for infringement of patent rights. The English company refused to give such indemnity, because of the uncertainty of the wireless patent position in Australia, the Amalgamated Wireless (Australasia) Limited having previously published threatening notices in the principal papers of every State of the Commonwealth. The English company, however, submitted a quotation for the transmitter at about £6,000.
As the result of several discussions, the Wireless Department advised that a plant manufactured by the Amalgamated Wireless (Australasia) Limited would be acceptable to it. The Associated Radio Company was, therefore, forced to open negotiations with that firm for the purpose of securing a transmitter for 5CL. The receipt of quotations, however, caused the company the greatest consternation, for the Amalgamated Wireless (Australasia) Limited not content with asking an enormous price, viz., approximately £8,000 for its apparatus, insisted as part of the contract that the Broadcasting Company should sign its patent licence No. 2, whereby a large proportion of the Broadcasting Company’s gross revenue was to be handed over to it as royalties. Only five Australian patent numbers appeared on the transmitter panels, yet the licence purported to cover considerably over 100 patents. Of these, a great majority had no application to broadcasting apparatus. The quotation of the Radio Communication Company previously referred to was about £2,000 less than that of the Amalgamated Wireless (Australasia) Limited, and was for a straight-out purchase, without any additional claims for royalties.- Amalgamated Wireless (Australasia) Limited, however, asked what was contended by wireless experts to be an excessive price, and, not being satisfied with this, demanded the company’s signature not only to their licence, but also to the following document: - 7th July, 1925.
Mr. Hooke, Messrs. Amalgamated Wireless (Australasia) Limited, Clarence-street, Sydney.
Dear Sir, - We hereby agree that we will not re-sell, or part with possession of 5 kilowatt broadcasting transmitter being supplied to us by you through Associated Radio Company of Australia Limited, Elizabeth-street, Melbourne, without your consent, which shall not be withheld if the party or parties purchasing or taking possession of the said installation enter into an agreement to observe all covenants and conditions of the company’s licence to operate broadcasting transmitters.
Iwish furtherto placeon record the fol lowing undertaking that Amalgamated Wireless Australasia Limited requires those associated with radio in Australia to sign -
Undertake not to dispute or question, or assist any other person to dispute or question any of the company’s patents - past, present, or future. A licenseeis not permitted to ?ell or transfer his rights.
As it is doubtful whether Amalgamated Wireless Australasia Limited has the right to its patents, it seeks to protect itself by requiring those with whom it transacts business to enter into an undertaking that they will not question the company’s right to royalties. The royal commission dealing with patent royalties, said : -
The evidence disclosed that the operations of this company extended over every field of radio and in almost every instance has created friction and dissatisfaction.
That is not to be wondered at in view of the exorbitant demands that the company has made upon Central Broadcasters and hundreds of other radio traders and interests in Australia. The report continues -
The demands of the company for royalties have been based upon the principle that it was entitled to demand from the public whatever it could got. The managing director of the company was asked whether the attitude of his company was that it was entitled to charge whatever it considered fair without regard to any other person’s estimation of what was fair, andhe answered: “Most certainly, when other traders want to use its property.” He said that the Patents Act entitled the company to charge whatever it thought fit for the use of its patents and thathe took as his guide the patent grant itself….. Not only has the company made demands on radio dealers, which, in the opinion of thu commission, are excessive, but they havesought to impose terms and conditions in their licences which are oppressive and unfair.
Yet this Government is prepared to endorse the action of Amalgamated Wireless Australasia Limited, and to permit it to continue to exploit those associated with radio throughout the Commonwealth. The report continues -
Moreover, the printed licence form includes a list of about150 patents, the existence and validity of which the licensee is asked to bind himself not to challenge. The evidence before the commission shows thatat least twenty of these patents have expired and a considerable number of them have no relation to wireless receiving sets. Even in cases where the Amalgamated Wireless (Australasia) Limited has sold and erected transmitting stations to broadcasting companies, the contract insisted upon by Amalgamated Wireless (Australasia) Limited has included an obligation on the part of the broadcasting company to pay royalties on patents employed in the articles sold and erected by Amalgamated Wireless (Australasia) Limited, and in respect of whichit has already received a handsome profit.
The royalty demanded by Amalgamated Wireless (Australasia) Limited from “ A ‘” class broadcasting stations is5s. for every listeners’ licence, amounting to 20 per cent, of the station’s gross revenue from licence fees.
In the year 1926 the actual cash paid or demanded by Amalgamated Wireless (Australasia) Limited in respect of this class of royalty was £38,100.
The cost price of the pater t rights of Amalgamated Wireless ( Australasia) Limited are shown in the books as £03,000.
The actual cash paid to the company for its royalties in one year, according to its own figures, was £38,100; yet the total value of the royalties as shown in its books, were £93,000. That surely is a handsome profit or interest. It approximates 41 per cent, upon the capital value, which even then is not the company’s estimated value of the assets that are very doubtful. There is a grave suspicion that many have expired or are unreal, yet this Government is allowing it to continue its exorbitant claims, which are nothing more nor less than commercial robbery and plunder. The Government is deserving of severe censure, and honorable members should enter their protest by rejecting the agreement with Amalgamated Wireless Australasia Limited which this House is now asked to endorse. Let me give the evidence of one of the Postmaster-General’s own officers. Mr. N. P. Brown, the director of the post and telegraph services, said -
Telegraph and telephone problems were closely allied to those of wireless, and the men dealing with those matters were peculiarly fitted technically to handle them. I do not think it would be safe for Australia to rely solely on the beam or that the control at wireless should be placed in the hands of one concern.
Mr. Brown, according to his evidence, is in favour of the Government taking control of wireless, and surely that is necessary in view of our past experience of the Amalgamated Wireless Australasia Limited’ and its broken pledges. The
Government should carefully review the position before it endorses the agreement with that company. It should adopt the recommendations of the Royal Commission on Wireless and seek to recover to the Commonwealth control over wireless communication, which is essentially a public service. We should have the most modern equipment and allow the people of Australia to reap the benefit in low rates. Under present circumstances we are receiving a minimum of efficiency for a maximum of cost. I hope that the House in its wisdom will reject the agreement that is now before it.
, - I listened with interest to the speech of the honorable member for Batman (Mr. Brennan). He has made an interesting speech on wireless in each of the last six years; but I must confess that he :has never placed before the Government any constructive proposal to benefit the people of this country. In his opening remarks he referred to the Wireless Committee that was appointed in 1921. “ He was a member of that committee, and I was, also. It sat and made exhaustive inquiries. It gathered evidence of a highly- technical nature. It was thought that the members of the committee were unanimous in recommending the agreement that was presented in 1922; but, to our surprise, we found that the honorable member for Batman had submitted a minority report objecting to the agreement on the ground that he had no faith in wireless highpowered stations. He has issued a challenge to the honorable member for Eden-Monaro (Mr. Perkins), who said that the honorable member for Batman (Mr. Brennan) had predicted failure, he was quite correct. He has predicted failure for the last six years. He has been, during all that time, the opponent of every wireless scheme put before the House. I shall put one or two statements to him, and ask him to give his unbiased legal opinion as to whether or not he has been the opponent of wireless.
– At current rates?
– I refer to the time when the original agreement regarding the high-power station was made in 1922. The honorable gentleman then said -
The proposal is a gamble in which the Commonwealth stands to lose heavily, or alternatively to share its remote and doubtful gains with private financiers.
On the 13th July, 1922, he said - that was an Imperial Commission which sat in 1920. only two years ago: The commission comprised world experts, which met in the heart of the Empire, and it was a committee whose decision in I !>20, was that such a scheme as we are now committed to was not practical beyond a distance of 2,000 to 3,000 miles.
At that time he was referring to the Norman relay scheme. It was clear that he favored that scheme, but if it had been put into operation it would, in two years’ time, have been obsolete, and of no use to Australia. The right honorable member for North Sydney (Mr. Hughes) is to be complimented for what he did in establishing the wireless service between Great Britain and Australia. When that committee was sitting in Great Britain, he stood alone; and now we have established the fact that the service which he supported can- operate satisfactorily. The honorable member for Batman has all along been just about three years behind the times. On the 14th July, 1922, the honorable member for Batman said -
Because occasionally some stray wandering messages are picked up from across the world - God only knows how they came or whether they will be likely to come again - the Prime Minister says, “ Yes, wo can enter into this contract with Amalgamated Wireless Limited with perfect confidence.” 1 do not know what is going to happen. All that I know is that we are committed to this costly experiment and that the indemnity or guarantee clause, when carefully read, is a very poor protection indeed, and I suspect that the time is not very far distant when we shall hear that there has been secretly appointed an arbitrator, something like the arbitrator in reference to the Kidman-Mayoh contract, to decide between Amalgamated Wireless Limited, and the Corr.monwealth as to what is to be done about thi service which cannot be given to Australia.
Now we get to the time the high-po”t:i station was beginning to operate, and he was beginning to waken to the fact that it would be practicable and possible to communicate by means of a high-power station. This is what he said on the 9th March, 1923-
We have gathered from the cables that the British Government lias decided to erect, as a Government enterprise, a high power station capable of serving the needs not only of this country, but of practically the whole of the civilized world. I suggest to the Prime Minister that the action of the British authorities is a broad hint worth taking. We could erect our own high power stations in Australia as a Government enterprise in line with the Government station on the other side of the water and withdraw from this money-making company controlled as it is by the great Marconi Trust, which is desirous of exploiting the Commonwealth in the company’s interests.
He began to realize that we should at least establish a high-power station which he had opposed right up to that time. I want to say, quite definitely, that it was the action of the right honorable member for North Sydney, and of this Government, that led to the great strides made throughout the world in the development of wireless. We have the longest onestep wireless system operating anywhere in the world, and that can be only attributed to the experiments carried out so successfully in Australia. To that can be attributed the successful commercial schemes now in operation. Had we carried out some of the high-power schemes which the honorable member for Batman in his after-thought recommended, Canada, India, South Africa, Australia, and Great Britain would have spent £2,000,000 in providing stations which have now been provided for £500,000. In 1924 it became necessary to amend the wireless agreement, because of the beam system being introduced, and this is what the honorable member for Batman said on the 22nd of September, 1924:-
I have been led to believe that the beam system cannot be relied upon to operate for more than two to four hours each day. It follows, therefore, that it can only be useful for deferred messages at the . best, and must be quite useless and hopeless in competition with the ordinary cable system.
It is very pleasing indeed to hear him to-day. He is now an optimist who believes that wireless will supersede the post office, and that letters will be sent by wireless which would ordinarily have been carried through the post. I am very glad to see that he takes this view, rather than the pessimistic view which he formerly held. On the 22nd February, 1924, the honorable gentleman said -
The Prime Minister, a day or two ago, spoke as if a revolution had been effected in this ngard, whereas, in truth and fact, since the date on which the original agreement was made, not a single step of any considerable importance has been taken to overcome tlie practical difficulties of establishing a commercial service.
It is a fact that the beam system can be operated for only a very brief period in the 24 hours. It can be operated only during the hours of darkness and, possibly, during the hours of twilight, but certainly ill no circumstances for longer than that.
Where is the authority, where is the expert, where is the commission, that will declare that such a high-power station as, under the principal agreement, we originally intended to have erected is likely to become obsolete within the next year or two, or even at any timet There is none.
Is it to be thought that the British Government, which has before it the very last word on wireless development, in the shape of the report of the Donald Committee, is in the centre of tlie world’s intelligence on this subject, and has the benefit of the most uptodate expert advisers the world can produce, would set out to erect and equip a high-power station - and a very high-powered station at that - if there was a probability of its being obsolete within a year or two?
To the last moment he remained an advocate of the high-power station, and condemned the beam system. He must now recognize that the beam is giving effective service. The first agreement entered into was in 1922. That was to establish a high-power station which was to cost £480,000. Alterations were made in the agreement in 1924 because we had by then made such progress in the development of wireless. South Africa had let a contract to build a high-power station and the work was practically half finished, when the plant was scrapped and f beam station built. We escaped, that expense, as we had not got any further than signing the agreement. To-day we have a station operating which cost only £120,000. The honorable member for Hindmarsh (Mr. Makin) took exception to the statements made by the right hon.orable member for North Sydney regarding the cost of the British beam system. He quoted the bare beam station, and a bare unit that was going to operate between Great Britain and Australia. He did not quote the two units, one to Canada and one to Australia, nor the royalties paid, nor the profits earned by I he company that built the station. The figures quoted by the right honorable member for North Sydney were correct. He was quoting the full unit; the honorable member for Hindmarsh was quoting the single unit. Had he made a proper comparison, he would have made it on the basis of a single unit to Australia, and not on the double mit intended to operate both to Canada and Australia. Had we carried out what was proposed under the high-power station scheme, we would now be hampered in the introduction of wireless telephony. “We are very close to the day when we shall have wireless telephony between Australia and Great Britain. That would be impossible under the high-power system. It is only possible with the beam system, or with a short wave, low-power system. “We have already had transmissions between Great Britain and Australia which have been fairly successful. We have not got to the stage yet when Ave can run a continuous service, but there is a continuous telephone service across the Atlantic on the short-wave system. I feel sure that it will not be long before we have a similar system operating to Australia. The cost of the beam system is £120,000, and that system is capable of handling the whole of the traffic’ to Australia. Wc have a cable system which operates between different places, and if we take the value only of those cables operating to Australia. we find that it amounts to £12,000,000. Who is going to operate a £12j000,000 machine when they can get a £120,000 machine which will give the same service?
– That is all right, but the Government has changed its own policy.
– We have not changed our policy. The beam system has been operating only since April of this year, vet to-day it is handling 50 per cent, of the total traffic. . Has any one ever before heard of any new commercial concern which, during the first six or seven months of its operation, has proved such a huge success as this has done. The honorable member for Batman actually went into poetry, and said that the Prime Minister had “ dipt into the future as far as the human eye could see,” and was speculating in rainbows. It is one of the most successful speculations that we have made. The honorable member may, perhaps, say that the scheme is possibly not in a position to carry on successfuly through the whole of the year; but the cables themselves fail sometimes. It is only a little while ago that we had an aurora which affected one of the cables. The messages were handed over to the Eastern Extension Cable Company, and transmitted by another route. Later, the Eastern Extension Cable Company had similar trouble, and had to hand its messages over to the Pacific . Cable Company. We have had the experience of the cable companies handing their traffic over to the Beam Company, and later of the Beam Company handing its traffic over to the Cable Company. These things are bound to happen. Nevertheless, the c success of this scheme has been beyond the dreams of any man. The station originally proposed to carry only a certain number of words, but up to the present it has carried more words than, under the agreement, it had stipulated to carry for the whole twelve months. There is only one unit in operation to Great Britain now, but in a short time the second unit will be operating to Canada. Some honorable members have referred to defence, and the need for retaining the cables for that purpose. I admit the soundness of that contention, and the cables to be retained would naturally be the Pacific cable on the one hand, a portion of the Eastern Extension cable on the other. The chief reason for retaining the cables is to ensure secrecy. In time of war it would be possible for an enemy to jamb any wireless message sent. Besides that, if we were to send messages in code, it would not necessarily ensure secrecy, as any code message could be decoded by experts. So far it is impossible to obtain in wireless transmission the secrecy necessary for defence purposes. Amalagamated Wireless Australasia Limited is to be congratulated upon what it has done. It is quite true that the Government has not received any dividends yet, but I believe that it is on the eve of obtaining a substantial revenue from the services which will be provided by the beam station. It is only since last April that we have received income from this source. In Australia there are quite a number of experimenters with the short wave system transmitting and receiving messages in Morse code from friends in many parts of the world.
What is possible with Morse code will soon be possible by telephone, as it now is across the Atlantic. No man can with accuracy foretell what is in store for wireless in the near future. The arguments of the honorable members for Batman and Hindmarsh were to the effect that the Government should take over the whole of our wireless activities. Those honorable members referred to the report of the royal commission on wireless, which, they said, laid it down that the Government should take over this o utility.
– It did, in certain circumstances.
– Not on any account. That report states that, in certain circumstances if Amalgamated Wireless Australasia Limited did not do certain things, the Government should take over wireless activities. The very definite recommendations of the commission is contained on page 4 of its report, and it reads -
In our opinion such a system is inadvisable, as experience already shows that when governments are placed in charge of the means of disseminating news, they arc apt to use such means for the purposes of political propaganda.
Moreover, such a system would deprive the public of the benefit of the incentive which the present regulations give to the broadcasting stations to maintain an effective and satisfactory sei vice.
Further, whatever wisdom may be displayed in tlie selection of Government officials for such a purpose, it is difficult to maintain that high standard of business acumen which is essential to securing the best results.
This is what the commission had to say with regard to broadcasting -
Having given the matter exhaustive consideration, the commission has come to the conclusion that very little change in the existing system is advisable at the present time. The existing broadcasting stations have had to pioneer the development of radio as applied to entertainment and the transmission of popular programmes of music and other items.
The case with regard to terminal rates was stated fairly fully by the honorable member for Batman. The Prime Minister, when making his statement the other day, went very carefully into the whole of the details of terminal rates, and there is no need for me to repeat them. Terminal rates amount to something like £45,000 on the present amount of traffic handled by the beam system. It was very doubtful whether the Government would receive those rates, and if it could not claim them it would have been forced to forego similar collections from the cable companies, as an international convention provides that terminal rates must not be charged to one company when they are not charged to another. In such circumstances the Government would have lost £100,000 a year. Now the Government is safeguarded, and will receive the terminal rates. The losses sustained by our coastal stations amounted to about £37,000 per annum. The honorable member for Batman made reference to the reception by the Government of 30 per cent, of the revenue. That is done for an expressed purpose. It must bc remembered that in its 1924 agreement Amalgamated Wireless Australasia Limited was under an obligation to establish feeder stations throughout Australia. Those feeder stations will now become part of our coastal station system. They will be better equipped, and probably have more up-to-date apparatus for transmitting purposes, and they will become the feeder stations provided for under the old agreement. To-day many of them are maintained simply to listen for S.O.S. messages from ships and to transmit messages to ships. I consider that the Government has done well in coming to an agreement with Amalgamated Wireless to continue and operate those stations. I feel sure that we shall have a better service under the new conditions. As the right honorable member for North Sydney (Mr. Hughes) said nearly all boats operating round Australia are equipped with wireless, and will also- be under an obligation to transmit meteorological messages free. That means a great saving to the Government, and should give us an excellent service. The revenue that Amalgamated Wireless would receive under the present system is £126,000 per annum, which is made up of 5s. from each licence, £1,000 from “ B “ stations, and 12s. 6d. royalty per valve socket. They also have some other source of revenue, particulars of which’ we do not know. Under the new system there will be only one charge of 3s. per listener-in. That will bring in £37,500, so that the company will actually lose £88,500 by the operation of the new agreement. Listeners-in in Australia will be able to purchase four-valve sets for £2 10s. less than at present, and there will also be a reduction in the licence fee of 3s. 6d.
Broadcasting is a new science. T. convened the first conference in Australia to deal with the subject in 1923, and it was held in Melbourne. Five or six years ago broadcasting was practically unknown. At that conference we established the “ sealed set “ system, which proved a total failure. People would not accept it, because they were compelled to listen-in to only one station. The honorable member for Batman has demonstrated how successful the open set has been, as to-day there are over 250,000 listeners-in. Some honorable members opposite contemplate that, in the near future, that number will be doubled.
– That will be so if more relay stations are provided in the country.
– In the city of Melbourne every third house has a. licence for a receiving set. The density per head of population owning sets is greater in Victoria than it is in Great Britain, and we do not know how many are operating without licences. Victoria has more wireless licences than all the rest of Australia put together. A great deal of credit is due to the excellent broadcast programmes provided. And surely it is worth something to have the future patent rights, both past and future, of such great companies as Radio Corporation, Telefunken, Marconi and others. The honorable member for Hindmarsh said that those patent rights were worth £93,000. That was in 1912, when broadcasting was unknown. . Today they may be worth more than £200,000.
– Be fair. The commission examined the books this year.
– By the new agreement which is now before the House, Amalgamated Wireless have to prove the validity of their patents. The case is before the courts in Melbourne and Sydney at present. Failing a successful issue of their efforts in Australia, they have to prove the validity of their patents by taking action against the New Zealand Government, in order to prove that they have substantial patent rights there. When Amalgamated Wireless claimed royalties, the New Zealand Government passed an act of parliament making every one who possessed a wireless set an agent of the Government, and then informed Amalgamated Wireless that if that company wanted to sue anybody in regard to patent rights they would have to sue the Government. The present Australian fees charged to owners of receiving sets are 27s. 6d. for the inner zone, 250 miles and inward, 22s. Gd. for the middle zone up to 400 miles; and 17s. 6d. for the outer zone, 400 miles and outwards. Under this agreement the fees will be reduced to 24s. for the inner zone and 17s. 6d. for the outer zone. South Africa charges 35s., Great Britain 10s., and New Zealand 30s. I maintain that our service is superior to that of New Zealand. Germany, which should be the home of broadcasting, charges 24s., and America makes no charge. The position in America is a complete tangle. The statement appeared in the press the other day that America was cancelling 300 broadcasting licences, that there are 700 licenced broadcasting stations in America, and that the whole of their revenue is derived from advertisements. We have not had the same confusion as other countries. We have done remarkably well in the conduct of our broadcasting system, the success of which has been due largely to the exceptionally fine programmes which have been arranged. Unfortunately, while certain stations have made good profits, the station in Tasmania has lost £3,000, and that” in Western Australia £6,000 annually. The commission suggested that to meet losses of that description a sufficient amount should be drawn from the general funds to allow £5,000 to be paid to each “ A “ class broadcasting station as an operating fee; but in view of the fact that certain stations are making good profits, it can hardly be said that the Government would be justified in adopting that course. Another suggestion which the commission made that is worthy of earnest consideration is that there should he more co-ordination between the different broadcasting stations. It would have been remarkable had we been able to inaugurate a service of this description and magnitude throughout Australia without making mistakes. Possibly it was an error to permit two “A” class stations in each capital city. It might have been better had stations been established 100 miles north and south of Melbourne and Sydney, so that a better service could have been rendered over a wider area to users of crystal sets. However, I believe that we are on the eve of considerable developments in broadcasting which will result in more co-ordination. We have done well in the past, and there is every reason to believe that we shall do better in the future. I trust that honorable members will approve of the bill.
.- I wish briefly to define the attitude of the Labour party towards the bill. It is generally admitted that wireless is one of the greatest achievements of the age, and that it is destined to play an increasingly important part in future world affairs. For that reason, it is highly desirable that it should be placed upon a proper footing in this and every other country. The honorable member for Batman (Mr. Brennan) and the honorable member for Hindmarsh (Mr. Makin) have dealt exhaustively with the provisions of the agreement, and closely examined the report of the royal commission on wireless ; and the Postmaster-General (Mr. Gibson) has also given honorable members some valuable information. I regret that the Minister saw fit to attack the honorable member for Batman. He observed that in the several important speeches which that honorable member has delivered on wireless in this House he had failed to make any constructive proposals. I disagree with the honorable gentleman. The honorable member for Batman has been thoroughly consistent.
– I do not deny that.
– He has consistently advocated that wireless should be controlled by the Government, and not by private companies. That is constructive criticism. The Government has muddled this business from beginning to end. The Postmaster-General complained that the honorable member for Batman had described the original agreement as a gamble, but the facts justify such a statement. That we have had three agreements before this Parliament in the course of six years is surely, proof that the first agreement was unsatisfactory.
– Probably this will not be the last agreement.
– That is so, for this is a new science.
– I presume that the Postmaster-General is referring to the beam system. When the first agreement was submitted. to Parliament for ratification, I made it quite clear that the Labour party desired wireless in Australia to be controlled by the Government. It is idle for honorable members opposite to suggest that this business has been satisfactorily managed. When the Government entered into this partnership originally it contributed £500,001 and , the private shareholders £499,999 to the capital of the company. In such circumstances it might have been supposed that the Government would have appointed the majority of the directors, but it did not do so. The private interests were allowed to appoint four directors and the Government only three.
– Each party appointed three, and the seventh was appointed by the six.
– That was done subsequently. I remember very well the part that honorable members on this side of the chamber took in that discussion. We maintained strongly that as the Government was finding most of the capital it should appoint the majority of the directors. It appeared to us to be totally wrong for the Government to put public money into this private concern and not retain complete control of it.
– One person who was appointed to the directorate had to be removed from it.
– That is so. When it was found that the original arrangement did not work well, the agreement was amended to permit each party to appoint three directors, who were empowered to appoint the seventh. It was provided that if they could not agree on the matter it should he submitted to an arbitrator.
– That is how the right honorable member for North Sydney became a member of the board.
– The honorable member for Batman made it quite clear this afternoon that the attitude the Labour party adopted in respect of the, two previous agreements was thoroughly justified. This company has been losing money ever since it began operations. Nobody suggests that it is a paying concern. When the bill for the ratification of the second agreement was before Parliament, the honorable member for Batman moved that a royal commission should b.e appointed to inquire into the whole subject. His proposal was defeated, but very shortly afterwards the Government appointed a commission, and so once more justified our attitude. In order that no question of party politics should arise the personnel of the commission was non-political. It was as follows: - J. H. Hammond, Esq., K.C., chairman ; Sir James A. M. Elder, K.B.E.; C. E. Crocker, Esq., M.I.A.E., M.I.M.E., M.I.E.E.; and A, J. M. McMaster, Esq. The commission took voluminous evidence, and brought in what I consider to be the most scathing report that has been presented to Parliament for many years. It condemned in every respect the manner in which the board of directors of Amalagamated Wireless Australasia Limited had conducted its business in the country. In regard to patent royalties it reported -
From the commencement of our inquiries the demands by Amalgamated Wireless (Australasia) Limited for patent royalties, both on broadcasting stations and on radio traders were a constant subject of ‘discussion. The evidence disclosed that the operations of this company extended over every field of radio and in almost every instance have created friction and dissatisfaction.
A wide-spread opinion prevails that because the Com mon wca 1th owns the majority of shares in Amalgamated Wireless (Australasia) Limited, that company should control itself and its revenues on the same lines as a government department providing a public service. Indeed, an argument was addressed to us by a representative of the Victorian radio interests based upon the language of section 51 (v) of the Commonwealth of Australia Constitution Act, and it was suggested that unless the company carried on its operations on the same lines as the Commonwealth carried on the postal, telegraphic, and telephone service, it was doubtful how far the Commonwealth could constitutionally be a shareholder in the company. The commission expresses no opinion on this constitutional question, but it is obvious from the terms of the agreement between the Commonwealth and the company that, except in the case of the matters expressly referred to in clause 3 (vii) it was intended that the company shoud be managed on ordinary commercial lines.
Although the commission did not express an opinion on the constitutional question, it made it quite clear that the operations of the company had not been carried on in a satisfactory manner. It was clear from the evidence adduced up to that stage that the company was carrying on the service in a very unsatisfactory manner. The report continues -
The conduct of - the managing director in carrying out the powers entrusted to him has created an atmosphere of hostility and distrust that has been manifested to the commission throughout the Commonwealth.
That is a serious statement against the managing director of a concern in which the Commonwealth has invested £500,001. Surely the Government has some responsibility in the matter. There should be no cause for such complaints by a commission composed of disinterested persons, after the Government’s four or five years’ experience with the company. The commission further states -
Notwithstanding that traders were refusing to sign the licence form submitted by Amalga- mated Wireless (Australasia) Limited and that goods were being sold in every city of Australia which were, according to the managing director of Amalgamated Wireless (Australasia) Limited, an infringement of patents held by his company, no steps were taken bv the company to protect its rights until quite recently and the litigation commenced against Melbourne and Sydney firms has been allowed to proceed in a leisurely fashion.
The Government should not be associated with a company that carries on its business in such a slip-shod way. The honorable member for Hindmarsh (Mr. Makin) showed that the New Zealand Government was greatly dissatisfied with Amalgamated Wireless Australasia Limited. If that Government, which was not directly associated with the company - but took action to protect the people of that dominion - had good cause “for complaint, what is to be said of the Commonwealth Government that is part and parcel of the concern? . It is a standing disgrace, that, although this
Government is fully represented in the company, it has allowed these unsatisfactory conditions to remain year after year. We now find the Government compelled to enter into another agreement with the company. It should have taken a firm stand and bought out the interests of those whose main idea is to exploit the public. The report of the commission also states -
In January. 1927, the chairman of directors of this company caused to be published in various newspapers a notice, in which the following passages occur: -
Judging by the reports appearing in the press, tlie position has been greatly misrepresented, and tlie claims for ro,valties by the Amalgamated Wireless Company have been distorted and exaggerated.
The Amalgamated Wireless Company is the holder of exclusive rights in Australasia to many vital patents for appliances or principles necessary to be used in wireless reception, by valve sets and in all wireless broadcasting transmission. Th’s has involved expenditure by the company of very large sums; further, in the cost of research work, organization, and continuing patent office fees - facts which appear to be overlooked.
The commission finds that the company has enforced payments that it had no right, under the agreement, to claim. “Wireless telegraphy is a national utility, and it should be entirely in the hands of the Government.’ It will play an important part in future with regard to world affairs. Although the commission reported, to a certain extent, against full control by the Government, the only justification given for that was that it would lead to political propaganda. The commission stated on page 4 of its report -
Moreover, such a system would deprive the public of the benefit of the incentive which the present regulations give to the broadcasting stations to maintain an effective and satisfactory service.
It seems to me that the wireless service could be used for political propaganda -whether the Government had control of lit or not. Even if the Government had no shares in the company it could, at any time, use the service for political purposes. . On many occasions the cable service has been so employed.
– The Postmaster- (General gave permission for political speeches to be broadcast.
– That is so. Governments always used the cable service for political propaganda. Every Government has indulged in that practice; but that is no reason why the Commonwealth should not take complete control of the wireless service, in view of the important part it will play in our lines of communication. This marvel of modern science will bring the different parts of the Empire and the various countries of the world into closer contact than was imagined possible half a century ago. The air service has revolutionized transport, and will have an important bearing on world affairs in future. Wireless communication will affect equally marked changes. By the aid of wireless telephony persons on opposite sides of the world will soon be able to exchange views in a few moments. Surely if it is right that the Govern .ent should control postal and telegraphic services, the complete management of wireless services should also be in its hands. The governments of other countries should take similar action. The present government could not have made a worse mess than it has of the wireless services of Australia, although it has been closely associated with and largely represented in the controlling company. The people’s” money has been placed in the concern; but the management has been handed over to persons over whom the Commonwealth has no control. I rose principally to point out that the Labour party has consistently urged that the Government should dissociate itself from this private company, which an impartial commission has condemned, lock, stock and barrel, for what it has done during the last six or seven years. The Prime Minister and the Postmaster-General claim that the beam system is on the verge of success. That is another strong reason why the control should be completely in the hands of the Government. Realizing what wireless telegraph means to Australia, we should not allow private individuals to interfere in a matter of national importance. If war broke out, action would have to be taken to obtain national control of this public utility. It is wise, therefore, that immediate action be taken in the interests of the people. Private individuals as partners with the Commonwealth should not he allowed to make charges over and above the actual cost of the services rendered, in order to extract dividends from the public. The Opposition will vote against the agreement. The first two agreements were unsatisfactory, and I have no doubt that the third will prove equally distasteful. The only way to deal effectively with these private interests is to buy them out. There is a provision in the agreement for the Commonwealth to buy out the balance of the shares at their market value. The best interest of the country would be served if that option were exercised now, and the wireless business were operated as a national concern.
Mr. PERKINS (Eden-Monaro [9.30]. - The Leader of the Opposition was most emphatic in his statement regarding the constitution of the original directors of Amalgamated Wireless, but from what I can learn his statements were not quite correct. The first signed agreement, dated the 28th March, 1922, included this provision-
So long as the Commonwealth or its nominees continue to hold a majority in number and value of the shares there shall be seven directors of the company, of whom three shall be nominated by and represent the Commonwealth and three shall be elected by and represent the holders of shares other than those allotted to the Commonwealth under this agreement, and the seventh director shall bc selected by a majority vote of the other six directors, and if the voting is equal shall be selected by arbitration in the manner provided by clause 20 of this agreement in respect of matters in dispute between the Commonwealth and the company, and shall hold office for a period of three years subject to removal at any time during that period by the unanimous vote of the other directors. The board of directors so constituted shall appoint its own chairman.
In accordance with that clause the directors were appointed. The chairman was duly elected by the six other directors; but, as his election was considered by some honorable members of the House unsatisfactory, he resigned, and the right honorable member for North Sydney (Mr. Hughes) was appointed in his stead. Although I was not a member of the House in 1922, I participated in the Federal election campaign of that year, and wireless was one of the burning questions on the hustings. The then Prime
Minister (Mr. Hughes) was severely criticized by his opponents on every platform throughout the Commonwealth because of the agreement, notwithstanding the fact, demonstrated conclusively in subsequent years, that it was a very wise arrangement. The right honorable member had taken a bold stand when he was attending the Imperial Conference; he had resisted the advice of experts that the Commonwealth should join with other British Dominions and the Mother Country in establishing a chain of wireless stations. He preferred to bring into existence a company to erect in Australia and operate a high-power station, which would give to us direct communication with the United Kingdom. In the next two years wireless made such rapid strides that it was thought advisable to cancel the original agreement and to make another providing for the establishment of the beam system. A beam station has been erected, and is’ already doing twice the quantity of work that was expected of the high-power station. During the short time I have been a member of this House I have heard the honorable member for Batman (Mr. Brennan) speak often on the subject of wireless, and ask very pertinent questions of the Prime Minister. I recollect that when moving the adjournment of the House on one occasion he spoke in very disparaging terms of the agreement relating to a beam station. To-day he denied that he had ever condemned the beam system. I have looked over some of the honorable member’s speeches, and I cannot find that he ever had a good word for beam wireless. He certainly said, in effect, that so far as he could see into the future he still expected to be told that the company had not yet completed its contract. The company has carried out its contract ; the beam system is in operation, and has justified itself. In moving the second reading of this bill, the Prme Minister said that 40 per cent, of the traffic was being handled by beam wireless, and to-night the Postmaster-General mentioned that the proportion has increased to 50 per cent. A newspaper article published yesterday regarding the competition of beam wireless and cables said that nearly 60 per cent, of the overseas work was being done by the former. No doubt the system will continue to develop, and my only fear is that the Government will find itself in difficulties in connexion with the cable system. The cables must be continued. In no circumstances can we allow this service to be disbanded and the expert officers associated with it to be dispersed. I quite expect that within the next few months the Government will have to submit to the House some measure to stabilize the position of the cable company in which the Commonwealth is a partner. Some people are of the opinion that wireless has made cables unnecessary. I do not hold that view. Despite the progress of invention the cable services are still required. The policy of this Government is to do away with a number of the smaller telegraph offices because telephones will give a more effective service. Nevertheless the telegraph will continue for a long time to have a wide sphere of usefulness. Notwithstanding the evolution of transport vehicles the old bullock waggon still has its uses, and I have no doubt that for many years to come we shall have to rely to some extent upon the cable services. I have no desire to enter into a controversy with the right honorable member for North Sydney as to whether thf. cable or wireless is most suitable for defence; my opinion is that, regardless of which is the better, both will be necessary. The honorable member for Batman disregarded one of the most important objects of the wireless agreement, namely, communication with the homeland. When the first agreement was signed in 1922 the subject of wireless broadcasting did not enter into consideration. The PostmasterGeneral said to-day that i:i 1922 no broadcasting licences had been issued in Australia, .md that by 1924 the number in New South Wales was only about 200. The sole purpose of tha original agreement was to bring about cheaper and more expeditious communication between Australia and the Homeland. The company has done that ; it has estaWished an effective service which is doing a large proportion of the total work in a manner that is quite satisfactory to the public. The matters in respect of which the company failed to carry out its agreement were comparatively small. The royal commission severely censured it because of the royalty charges it was exacting from the public, but they are an insignificant feature of the whole scheme that hae been brought into operation under the agreement. The commission pronounced the royalty fee of 32s. 6d. in respect o? valve sockets excessive, but the same charge is collected in the Mother country. Under the new agreement, however, that charge is to be reduced to 5s. and thu fee in respect of each listening-in set is to be reduced from 5s. to 2s. This will mean a great benefit to all wireless enthusiasts, and, if only for that reason, the agreement should be welcomed. The honorable member for Batman, as spokesman for the Labour party, mentioned three objections to the agreement - (“I) that the company cannot provide the service for which it is contracting; (2) that wireless should be nationalized because of its special importance to the postal and defence de* partments; and (3) that the company is a branch of a foreign trust. The answer to the first objection is that the company is already giving a satisfactory service which is improving and extending from day to day. It is true that wireless is of national importance, but the country is safeguarded by the fact the the Commonwealth owns more than half the shares. If we are involved in war or if for any other reason the nationalization of this service becomes necessary, the Government can exercise its right to buy the balance of the shares.
– If nationalization is good in time of war, why is it not good in time of peace?
– Governments do lots of things in time of war that are not necessary in times of peace. It commandeers whatever supplies are necessary for the defence of the nation in time of war, but I am sure the honorable member would not approve of commandeering in normal times. The Commonwealth has power to acquire full control of this wireless system whenever such a course becomes necessary. So far from Amalgamated Wireless Australasia Limited being a branch of a foreign trust, 99 per cent, of its shareholders are Australians, and nearly every man in the service of the company is a citizen of this country. A few days ago members of the Opposition werechampioning the Commonwealth Shipping Line, although half the men employed in it are domiciled outside Australia. The wireless company is practically all Australian, and it has trained, and is continuing to train, hundreds of our young men to become expert operators. Moreover, the company manufactures many articles in Australia which are able to compete Avith the products of other parts of the world. One of Australia’s warships recently went abroad and with a wireless equipment composed entirely of articles manufactured by Amalgamated Wireless Australasia Limited, maintained communication with Australia throughout the voyage to the North Sea. It is wrong of the honorable member to say that this is a foreign company.
– Read the share list.
– I have seen the list of shareholders, and it confirms my statement that the company is 99 per cent. Australian. The mechanical parts used in every broadcasting station in the Commonwealth have been locally made, and the company is thus providing scientific training and work for our young mcn. In the various country towns repesentatives of Amalgamated Wireless Australasia Limited are carrying on active propaganda for the use of Aus- tralian-made wireless material. The science of wireless is developing so rapidly, is so universally used, and is so generally understood that even school boys talk learnedly of its technicalities. This spread of popular knowledge on a highly technical subject is largely due to the operations of this company. Reference has been made to the profits of the company, but I can well understand that great losses also are possible. I was one of the first to take out a listeningin licence in 1924, and I paid £80 for a receiving set. In the next couple of years such developments had taken place in wireless apparatus that I traded in the old set for £2 10s. The allowance made for the old set was all that it was worth, because every part had become obsolete. I have no doubt that developments will continue at such a rate tnat an enthusiast who buys an up-to-date instrument to-day will find on the market a few months hence a better article that he would like t’o substitute. If one individual can lose so much money in two years through the rapid obsolescence of a single receiving set, it is obvious that a big company risks very heavy losses. I give all credit to Amalgamated Wireless Australasia Limited for what it has done to foster Australian industries. I have not been abroad, but I have heard of the progress that has been made in wireless in other countries, and I think that Australia should be proud of the position that it occupies in the wireless world. Men trained in Sydney are occupying leading positions in wireless institutions of New York. One Australian - and he is. in this building to-night- as a lad in the postal department, took a keen interest in wireless, and he is now occupying the proud position of Director of Wireless in the Commonwealth. No doubt there are hundreds of other young Australians who have been brought to the front through the agency of Amalgamated Wireless Australasia Limited. It has been contended that wireless in time of war is of little use because messages can be intercepted, but that applies to every device of communication. A ship may be sunk, a train wrecked, and cables cut. Wireless messages can be jambed, but that is no reason why the system should be condemned, and I congratulate the Government for extending the agreement with this company, which has done so much to further the interests of Australia. It has received much abuse. Some of it may be deserved, but a good deal of it should be shouldered by this Government, because it controls wireless broadcasting, and those who are dissatisfied with the broadcasting service are apt to attribute the sins of the Government to the company. Many listeners-in suffer much inconvenience because in cities like Sydney, where the stations are close together, it is difficult to distinguish one from the other. M.’any persons buy cheap sets, of which there are many varieties, and they become disgusted with the results and discard the sets. The Government has permitted the establishment of too many “ E “ class stations, and that is no fault of the company. I hope that many of the recommendations of the commission will be adopted, and those anomalies rectified. The Postmaster-General pointed out that the excellent service in Melbourne was responsible for the great number of listeners-in there. In Sydney, we have no objection to the programmes, and I consider that they are equal to those of Melbourne, but I know that unless one has a good set in Sydney it is impossible to tell one item from another, and that has led to want of interest on the part of the listeners-in. The “ B “ class stations .have too much power.
– Buy an up-to-date set and that difficulty will be overcome.
– In Melbourne one can manage fairly well with a low-priced set, but in Sydney that is practically impossible, and therefore expensive sets are necessary. When the “ B “ class stations are not allowed to distribute on high power some of the abuse that is now w rongly levelled at the company will disappear. Broadcasting could be popularized in the country districts if the PostmasterGeneral were prepared to experiment with relay stations. 3LO is having wonderful success in Melbourne, and yet CO or 80 miles from that city fading takes place. That could largely be overcome by the use of relay stations. 3LO is anxious to erect four or five of those stations, and a similar movement is taking place in New South Wales. If these stations were provided, broadcasting would receive a great impetus in Australia. It is possible to-day to buy good wireless sets at a reasonable price. The people in the country districts would derive considerable benefit if the 1 Postmaster-General would follow the example of the British Government and provide a reliable uniform set. I know of a fairly wealthy person in the Moruya district who purchased two or three sets before he could get any satisfaction, with the result that wireless received a setback in that district for some considerable time.
– Who is responsible for that?
– Not Amalgamated Wireless Australasia Limited. The Government is responsible to a certain extent, because it allows that sort of thing to continue. At present all kinds of wireless sets are in use in the country districts. Some are satisfactory, but others are not. Even sets that are satisfactory in some cases could have been purchased at a lower price. Australia should be grateful to the Amalgamated Wireless Australasia Limited because it has acquired patent rights from other countries, and is collecting reasonable royalties upon them in this country. We therefore have the advantage of the most modern radio appliances, and all we have to do is to pay a low licence-fee to the Postmaster-General’s Department, and reap all the benefits of wireless broadcasting. The company has done excellent work for Australia, and the Prime Minister is to be congratulated on extending the term of its agreement. An important development in wireless recently is the location of stations. Even within the city boundaries location is an important factor, and one or two stations have already been moved ten or fifteen miles with greatly improved results. The actual sins of the company are so few that only one or two references are made to them in the report of the royal commission. I trust that the progress in wireless that has taken place during the last five years will be repeated in the next five years.
.- This evening the Postmaster-General (Mr. Gibson) was inclined to spread his wings and take to himself considerable credit for the favourable position that Australia occupies in the wireless world. I am prepared to agree with him, but I wish to remind him that there is a history in connexion with Australian wireless, and it is as well that honorable members should refresh their memories as to who took the initial step in wireless in Australia. That step was taken by Mr. Andrew Fisher when Labour Prime Minister of Australia. In 1911 he was in the Old Country attending his first Imperial Conference, and while in London he came into contact with an ex-Queenslander and wireless expert, Mr. Balsillie, who with one or two others were subsequently brought to Australia to establish the wireless system here. Mr. Balsillie set to work to manufacture his own machines, and he incorporated in them his own improvements. He was immediately challenged by the Marconi Company, of which the Amalgamated Wireless Australasia Limited is a pup. The companies in Canada and South Africa are also dominated by the Marconi Company. Tha’, company threatened to stop the progress of wireless in Australia unless we adopted its system from A to 2. The case went to the court, and the verdict was given in favour of Mr. Balsillie, the court deciding that his wireless improvements did not infringe the Marconi patents. Soon afterwards the great war put a damper on wireless in Australia. That we had established a Wireless Department is evidenced by clause 9 of the first agreement, which reads -
The company shall take over the existing personnel of the Commonwealth radio service at rates of remuneration equal to those payable at the time of taking over, and shall conserve to the employees so taken over any pension rights, or retiring allowance or furlough rights which would have accrued tn those employees if the service with the company had been a continuation of service with the Commonwealth.
We should give credit where it is due. The Labour party, as in many other instances, had the foresight to lay the foundation of wireless in Australia. Mr. George Wise lost his position as PostmasterGeneral of the Commonwealth mainly because he was a bitter opponent of the Marconi Company. -He came to me and said, “ Whatever you do, do not allow yourself to get into the grip of this company.” Events to-day prove that his warning was well justified. Australia holds its proud position in wireless today because of the foresight of Mr. Andrew Fisher in bringing Mr. Balsillie to Australia. It is a remarkable thing that while Amalgamated Wireless Australasia Limited is lauded to the skies to-day, it has not always borne so good a reputation. I do n.t blame the right honorable member for North Sydney (Mr. Hughes) for his attitude. He i* the father of these agreements, and today he is one of the Government’s nominees on the bo:rd. I do not think it was ever necessary for a commission to investigate wirel3s in Australia. The Government has hardly accepted one of the recommendations made. Nearly every member of the commission was, as it happened,, a member of the Nationalist party. Tt was presided over by a very clever King’s Counsel from Sydney, Mr. Hammond. The commission examined 150 witnesses in every State of the Commonwealth, and it made certain recommendations. No . reasonable man in this chamber would say, in the face of that commission’s report, t1 “t Amalgamated Wireless Australasia Limited, is a very desirable concern with which to associate. I know that the Government has made itself responsible for £500,001, which gives it a majority of one share in a concern with a total capital of £1,000,000. I do not wish to say anything against the members of the Government, but this concession was only given to the company because it happe>ed to start operations here. In South Africa it is the Amalgamated Wireless Company of South Africa, and in Canada it is the Amalgamated Wireless Company of Canada. This company is made up of nearly every important nationality in the world, French, American, German, and Italian interests being concerned. The Telefunken service was operated by Germans during the war, but when the war was over, Marconi got to work and swallowed up the Telefunken Company, and one or two other companies’ in America as well. It is now a great international corporation, and that is one reason why every successive British Government, and every successive PostmasterGeneral in Great Britain has had as little to do with it as possible. We have had about five governments in Great Britain since wireless became an important factor, and every one of them, whether Labour, Conservative, or Liberal has been extremely careful in its dealings with the Marconi Company.
– Who built the British wireless station?
– The British Government said to the Marconi Company that it might build a station, but the company had to offer a guarantee that every portion of the work would pass inspection before it was allowed to start.
– The Government granted this company a licence.
– The Government is still suspicuous of this company, whose antecedents are such as to make any decent man think carefully before entering into any dealings with it. The Amalgamated Wireless Australasia Limited of Australia is only an off-shoot of the Marconi company. I am a great believer in wireless myself, and we do not really know the possibilities of it as yet. Some of us have enjoyed the comfort of lying on our back listening to some of the finest programmes which can be transmitted. I do not say it was a torture, but I have listened in to a speech delivered by the present Prime Minister (Mr. Bruce), and I must commend the people of Bendigo upon the method in which they organized the programme. I interjected once or twice during the speech, but as the right honorable gentleman was 100 miles away, I do not suppose he heard. I obtained a wireless set as soon as I was able to do so, and I speak as one who has enjoyed himself immensely with it. For people living in out-of-the-way districts, it is one of the finest things that has ever been invented, and I believe it will go far towards removing the discomforts under which rural people labour at the present time. I have inspected Parmer’s station in Sydney in company with Mr. Robinson, and I saw there that every provision had been made to supply good programmes. In Victoria we have had very little reason to complain. Sometimes, perhaps, a programme may be interrupted when some folk are trying to get in touch with a ship at sea, and we have heard the sound of the Morse. I had a few friends with me on one occasion, one of whom could read Morse, and he informed me that the message which was then coming through was being sent by a steward on board a ship coming from Sydney to another returning from Melbourne, and was asking another steward to pick up a bag which had been left at a certain place, and bring it back on the next trip. The right honorable member for North Sydney said that I was off the rails, and made some of those jocular and clever remarks that made the honorable member for Bass (Mr. Jackson) laugh; but then the honorable member for Bass is prepared to laugh at very little. The right honorable member for North Sydney was talking about all these wonderful patents which the company had secured in France, Germany, Italy, and
America, and which it was prepared to place at the disposal of the people of Australia. The. company, however, is being well paid for those patents. When I asked the right honorable gentleman what the company had paid for them, he looked at me and struck a funny attitude. Amalgamated Wireless Australia Limited itself says that the value of these patents is £93,000. Does any one think that this company is going to set down in its statement the absolute minimum value of those patent rights? Not at all. In the light of the doubt which is in the mind of the commission, it would not surprise me if it were proved right up to the hilt that the company paid not £93,000, but possibly £40,000 or £50,000.
– The Postmaster-General said that that was the value in 1912. It was also the value in 1926.
– The books were examined this year. Does the Minister mean to tell me that Amalgamated Wireless, Australasia, Limited would allow the commission to examine books showing the value of their patent rights at an old date? It would be foolish to make such a suggestion. The commission has no doubt that the company has been highhanded and overbearing in relation to its patent rights. It is important, therefore, that the Commonwealth should establish, at the earliest possible moment, the validity of the patents that are claimed. Such action would not only alleviate the distress that has been caused, but also enable an appraisement to be made of the value of the patent rights owned by the company. The commission doubts whether it really owns them. The Postmaster-General read with great gusto certain extracts from the commission’s recommendations. It did not recommend taking over or buying out the other companies. What has the Minister to sayregarding its other recommendations?
– They are all conditional..
– The commission recommends -
That the charges made by Amalgamated Wireless (Australasia) Limited on broadcasting companies are excessive, and that they should be reduced to a royalty of 2s. on each listener’s licence.
– Under the proposed agreement, there are to he no charges.
– That proves that they were getting more than they deserved. Another recommendation is -
That the charges made by Amalgamated Wireless (Australasia) Limited on radio dealers aru also excessive, and detrimental to the development of wireless services within the Commonwealth, and that they should be reduced to a royalty of 5s. on each valve holder, such royalty to include one valve for each valve holder.
What has the Government done to have that charge reduced from 12s. 6d. to 5s.? If the reduction were made, what a great saving it would be!
– Under this agreement, all their patents are to be used free of charge in the future.
– They were charging broadcasting companies 5s., and radio dealers 12s. 6d. Other recommendations are -
That the attitude of the company with regard to claims for royalty on separate valves should bc immediately defined, and that the claims against traders in respect thereof shouldbe abandoned, so far as transactions on, or previous to, the date of publication of this report are concerned.
That the charges made by Amalgamated Wireless (Australasia) Limited on revenueearning “ B “ class broadcasting stations should he limited to 10 per cent, of the gross revenue of each station.
That the Commonwealth Government should request Amalgamated Wireless (Australasia) Limited to comply with the requirements contained in the foregoing four paragraphs.
Has the Government made the company comply with those requirements? The following recommendations also have been made -
That failing compliance with the foregoing requirements, the Commonwealth should take steps to acquire the shares privately held in the company on just terms to the private shareholders.
That prior to the acquisition of shares the company should be directed to take all steps to obtain an early decision on the validity of its patents.
That the recommendations of the commission as to royalties and patents shouldbe given effect to both as to future and also as to cur- rent licences as from the date of the publication of this report.
That is a direct recommendation. The commission says that if the Government does not choose to adopt its four recommendations it should buy out the company. Yet the Postmaster-General pur ports to quote from another part of the report, and says that those recommendat’ons are conditional ! The Leader of the Opposition (Mr. Charlton) was contradicted with respect to a statement he made about a certain clause in the agreement on the 7th December, 1921. This is what the honorable member then said -
As the Commonwealth will provide more capital than the company, it should have a controlling interest in the concern; but paragraph (iii) of clause 3 of the agreement says - That so long as the Commonwealth or its nominees continue to hold a majority in number and value of the shares of the total number of directors of the company, including the managing director if he has a vote, threesevenths in number shall bc nominated by, and represent, the Commonwealth, and foursevenths shall he elected by and represent the holders of shares other than those allotted to the Commonwealth under this agreement.
It will thus be seen that the Leader of the Opposition was perfectly correct in his statement; yet some honorable members opposite were prepared to contradict it. A great deal has been said regarding reductions in licence fees that have been made by the company. I point out that, as it is supposed to make payment on the bass of 250,000 listencrs-in, it is at least 7,000 to the good, because the number of listencrs-in has increased to that extent; and it is still increasing. The company knows full well that while it is giving with its right hand it is taking in with its left. It is composed of shrewd and brainy men, and requires close watching. Every agreement needs to be strictly analyzed. If there are any advantages to us in the agreement that we are now asked to sanction, they are the result of the criticism that has been levelled at the company by honorable members who sit on this side. I pay my meed of praise to the honorable member for Batman (Mr. Brennan), who has always kept this matter well in mind, and has succeeded in drawing attention to many of the corncompany’s tricks. The agreement provides that -
The company agrees, during the currency of this part, to grant a licence free of loyalty, to each newspaper published in the Commonwealth and each wireless telephone broadcasting station in the Commonwealth, which makes application therefor, to use any or all of the patents to which clauses6, 7 and 0 of this agreement apply, for the purpose of receiving the official news bulletins issued by the British Government and transmitted by Rugby or any other transmitting station in Great Britain,
H. - (1) The company agrees to prosecute as expeditiously as possible to judgment the actions which have already been instituted by it in Australia for infringement of patent rights which actions it is agreed are for infringement of patent rights substantially important in connexion with wireless broadcasting;
The company agrees that, unless within twelve months from tlie commencement of this agreement, judgment in its favour (otherwise than by consent) is given by the court of final resort upon the issues raised prior to the date of this agreement by the pleadings in one or more of tlie actions referred to in sub-clause 1 of this clause, it will, within the aforesaid period of twelve months commence an action or actions in Now Zealand for infringement of the New Zealand equivalents of the Australian patents involved in the actions referred to in sub-clause 1 of this clause or other patents substantially important in connexion with wireless broadcasting, and will, unless and until there has been given in favour of the company in the Australian actions, such a judgment as is specified in this sub-clause, prosecute such action or actions as expeditiously as possible.
If the company fails to comply with the obligations imposed upon it by sub-clause 2 of this clause to take proceedings in New Zealand for infringement of patent rights, this part of this agreement shall cease and determine at the expiration of the aforesaid period of twelve months.
The party with whom this Government is entering into an agreement is placed under duress to prove its patent rights. Every effort on the pa: t. of honorable members on this side has been directed to purify affairs in connexion with wireless. Successive British governments have given us a good lead. Those governments know as much or more than we do about wireless, and they realize th-M it is dangerous to be closely associated with the Marconi Company, (f which Amalgamated Wireless Australasia Limited is an offspring. Everything done by this Government is to assist big business. Wireless is a big concern. I suppose that the Marconi Company has many millions of pounds behind it. It has ramifications throughout the world. This Government and its supporters are walking arm in arm with big business. It will give this company £500,000 to assist it to arrange things satisfactorily in Australia. From what I know of the antecedents of this company and the parent company from which it sprang, we need to be very careful, otherwise Australia will be placed in a serious position. If the British Government can control wireless in Great
Britain there is no reason why we cannot do likewise here. If it were possible for me to move an amendment to take our telephone service from the control of the Postmaster-General’s Department, and I do so, the Minister would rise in great indignation. The Postal Department ha as much right to control wireless as it has to control postal affairs. I am not favorable to this agreement, as it is dangerous to be associated with these people. If any benefit accrues from the agreement it will certainly be due to the efforts of the Opposition.
.- J am interested in two items in particular in connexion with this measure. The first is wireless communication with Tasmania. At present the station in Hobart closes at 8 p.m. The Royal Commission on Wireless said that Tasmania should have a 24-hour service. I suggest to the PostmasterGeneral that he should give effect to the recommendation of the commission. As the honorable gentleman stated, the cable goes out of commission at times.
The second item in which I am keenly interested is the installation of wireless in our outback sections. I have been in places in Australia hundreds of miles away from railway and telephone. Whilst I do not suggest that the Government should provide free telephonic or wireless communication in those areas, where the volume of traffic is infinitesimal, it should make money available so that the post office may attend to the job. I have in mind Birdsville, which is in the south-west corner of Queensland, 240 miles from the nearest telephone and doctor. The Rev. John Flynn, head of the Australian Inland Mission, which i.« a branch of the Presbyterian Church of Australia, is at present in the far north of Australia experimenting with a cheap transmitting wireless set, and I understand his experiments have been very successful. An ordinary wireless telephone conversation from that centre has been heard in Sydney. I understand that the reverend gentleman is very hopeful that his mission will be able to install plants at its various stations at a cost of from £40 to £50. Honorable members must understand that, while wireless is wonderful from a reception point of view, much of its value to the outback is lost if it cannot be used for transmitting purposes, it is necessary at times to send urgent calls for assistance. In April of next year the Australian Inland Mission proposes to inaugurate its first aeroplane doctor service. That service, associated with an effective wireless transmitting set, would be of inestimable vo. lUe to residents of the outback. I suggest that the Postmaster-General should co-operate with the Australian Inland Mission and do whatever he can for them. I know that the honorable gentleman’s department has assisted that mission, as has also Amalgamated Wireless Australasia Limited. I commend that company for the way in which it has endeavoured to bring about a realization of the ideal of Mr. Fisk, its managing director, to make Australia the wireless centre of the Pacific. Honorable members will admit that what has been done up to the present is convincing evidence that before long that will be accomplished. I regret that during the debate very little favorable to the managing director of Amalgamated Wireless Australasia Limited has been said. When the history of wireless in Australia is written two names will be given prominence ; the names of the right honorable member for North Sydney (Mr. Hughes) and the managing director of Amalgamated Wireless Australasia Limited (Mr. E. T. Fisk).
– The honorable member has not started with the first chapter.
– It is true that Mr. Fisk did not appear on the scene at the beginning ; it is equally true that the hero of a story does not always make his appearance in the first chapter. . Nevertheless, when the true history of wireless in Australia is written, Mr. Fisk’s name will loom large in it. Australia needs more relay stations so that people living in outback districts may be able to get the benefits of wireless with the use of cheaper receiving sets. When the PostmasterGeneral was speaking of people living in the outer zones I interjected that I favoured people living 400 miles from a broadcasting station being charged no fees at all. In all Australia there are only about 2,000 listeners in the outer zones. It would not be much to allow them- to use wireless for nothing.
I hope that in the near future the department will be able to do something to provide wireless telephonic communication between -Tasmania and the mainland. I understand that at the moment the chief difficulty is the one of cost - that the cable cannot be used cheaply for telephonic conversations. All the other States are linked up with telephones and wireless, and Tasmania is entitled to a similar advantage because of her insularity. It has been contended that the Commonwealth Government should have the sole control of wireless in Australia. In my opinion we have advanced further in wireless matters through private enterprise than would have been the case had wireless communication been solely under the control of a government department. I say that without in any way reflecting on the staff of the Postmaster-General’s Department. Its officers have done good work. If wireless had been solely under the control of a government department, we should probably have found, as we have already found in connexion with the Postmaster-General’s technical staff, that private companies would have attracted them by offering them higher salaries. Unfortunately, we do not place a sufficiently high value on the services of some of our public servants. The attitude of the honorable member for Batman (Mr. Brennan) is amazing. To-day he was at some pains to make clear what he really meant in the various speeches he has delivered from time to time. He told us to-day that at no time had he said that the beam system would be a failure. Beading his speeches carefully, I find that the honorable member is right in that statement. I should like, however, to read from a speech which he delivered on the 11th August, 1926, in connexion with the budget for that year. He then said -
I have not- the slightest doubt that it will be for. me next year to point out that Amalgamated Wireless (Australasia) Limited is still in default. . . . Some day in the unknown future I confidently expect that we shall have such a service as the company has agreed to give us,’ but by constantly recontracting with the company to do something at some future date which we know it cannot then do, we bring about an absurd and indefensible position which the Government ought not to be content to occupy.
A little later in that speech he said; -
It contracted to do that which it knew was impossible, and now it is promising to establish a service at a certain date when it knows that that also is impossible in the present state of knowledge.
At that time the company was engaged in erecting the beam station. “Within eight months of the time when that speech was delivered, successful tests of that station had been made, and tha company was sending and receiving messages on a commercial basis. In that direction at least the honorable member for Batman has proved a bad prophet. I am pleased at the way in. which this business is being conducted as an Australian enterprise. As has been stated during the debate, our wireless technical experts, have, for the most part, been trained in Australia, principally at the cost of Amalgamated Wireless Australasia Limited. Some of these experts have been sent to Englii nd for their training. The company has a staff of between 800 and 900 persons. Great credit is daa to the managing director of the company (Mr. Fisk) for his long vision which has shown that Australia can be the great wireless centre of the Pacific. Tho way in which he has pioneered this system and made Australia one of the leaders in wireless matters to-day, is worthy of our commendation.
– I join with the honorable member for Bass (Mr. Jackson) in appealing for consideration for the people outback, and in his tribute to the splendid work performed by the Australian Inland Mission. To the primary producers in outlying districts, wireless has been an inestimable boon ; I speak from experience. No prophet could have predicted .anything more remarkable than that it has accomplished. By means of wireless these settlers obtain valuable information regarding weather conditions, and market reports, to say nothing of the social benefits it confers. I rose primarily to’ point out that these benefits cannot be .shared by many settlers because of the high cost of receiving sets to enable them to tune in to the existing broadcasting stations. I speak particularly -of new settlers in the Mallee districts. The closest broadcasting station to my home is in Adelaide, although, for the most part, we tune in to the Melbourne sta-; tions. A receiving set which will give satisfactory service in that district, costs between £40 and £50. There is not only the initial cost to be considered. Batteries -frequently need recharging, which means in many cases that they must be sent considerable dis.tances by rail to battery stations. Breakages occur, and replacements are necessary. In all these circumstances wireless is rather expensive to the people outback. I trust that the Postmaster-General and the Government representatives on the board of Amalgamated Wireless Australasia Limited will do their utmost tu provide relay stations, so that people in such centres as Mildura and Ouyen will be able to enjoy wireless programmes under conditions similar to those which apply to the workers in our cities. If relay stations were established, crystal sets could be- used satisfactorily. The real point at issue in this bill is whether wireless shall be placed under full or only partial Government control. I have listened to this debate with an open mind. It has been said by honorable members of the Labour party that the control which the Government exercises over the present company is merely nominal, while Government supporters have asserted that it is real. My opinion is that though the Government is, so to speak, the senior partner in the firm, the junior partner has the expert knowledge of the business. I do not suggest that the Government members of the board have been negligent; but they have been dominated by their colleagues. It is difficult to visualize the future developments of wireless; but I am firmly of the opinion that our present methods will be just as crude and antiquated in two or three years’ time, as our methods of three or four years ago were compared with existing methods. Wireless is part and parcel of the every day life of the people, and sooner or later it will have to come under complete government control. If war should occur, one of the first acts of the Government would be to assume sole charge of the machinery, plant, and service. I submit that it might just as well take over the responsibilities to-day, and run the business as a branch of the Postmaster-General’s Department, retaining, if necessary, the business experience and expert knowledge of Mr. Fisk and other technical officers of the company. For these reasons I shall vote against the second reading of the bill.
– I do not desire to give a silent vote on this bill. Wireless development has been disappointing in Western Australia. The broadcasting programmes have been of such a character that listening-in has not been encouraged. Many people who purchased sets in the early stages have practically Ceased to use them, and many others who were inclined to invest in sets have not done so; consequently the business in Western Australia has been comparatively small. The present broadcasting company has found difficulty in arranging satisfactory programmes ; but I am satisfied it could have done a good deal more than it has done. People in the remote areas of Western Australia deserve a good broadcasting service. One of the troubles in Western Australia has been that only one broadcasting station is operating. I am of the opinion that the company in control of it should be urged to rend a better service. I have interviewed the Postmaster-General with respect to 1T,e granting of an additional licence for Western Australia, and I trust that something will be done in that regard.
– Would money be forthcoming to establish a new station?
– Naturally, many people in. Western Australia desire to enjoy wireless facilities, and I feel sure that if there was a prospect of better programmes being provided, many of them would obtain licences to listen in. I agree with the honorable member for -Wimmera (Mr. Stewart) that the issue before us is partial versus complete government control. I have never been satisfied with the part that Amalgamated Wireless Australasia Limited has displayed in developing this service. I should prefer to see it become a branch of the PstmasterGeneral’s Department, and be subject to complete government control. If a time of emergency, such as of war, should arise, the Government would be obliged to assume responsibility for the service, and it would be advisable for it to do so at once. However, I shall vote for the bill, for I consider it to be as good a bargain as can be made at present; but I do not believe that the arrangement t ill continue for any length of time. I trust that in its transactions with the company under the new agreement the Government will act without sentimental leniency and deal with it in a businesslike way by keeping it up to the strict letter of the agreement, which it has apparently not done in the past.
– The difficulty is- that one party to the agreement is out for profit, and the other for service.
– Exactly. We cannot altogether blame the company, for it is making profits for its shareholders. It could not live if it did not do that. The present arrangement is one that cannot work satisfactorily. If the company has to decide whether it will increase its profits or render a better service, it is hardly likely that the profits will be overlooked.
– It will never be a success under such conditions.
– I am afraid not. At any rate it depends largely upon the firmness of the Government and its determination to do its part under the agreement. Considerable leniency has been shown to the company in the past, and if it does not keep up to the scratch in the future I hope the Government will not hesitate to take over the entire control of the service. I do not wish to deal harshly with the company ; but I venture to express the opinion that the present system will not work, and that byandby the Government will have to assume complete control in Australia. As it is an intricate and troublesome problem, I do not at this stage propose to criticize the Government’s proposals. I shall give my support to the bill; but I sincerely trust that the Government will see that the terms of the agreement are rigidly observed.
– This is not the first time that I have discussed the subject of wireless in this House, and on this, as on other occasions when the subject has been under consideration, the honorable member for Batman (Mr. Brennan) has spoken on behalf of the Opposition. When he led the first attack on the action which the Government proposed to take in the matter of wireless, it was my privilege and pleasure to reply to him at considerable length, as he dealt with a great number of points. To-night, that is unnecessary, as this time the honorable member has not made out a case for me to answer. I have a good deal of sympathy for him, because the facts have gone entirely against him. He predicted from the beginning that everything would be a failure, but this afternoon he said that he had never suggested that the beam system would not be a success. He appeared as an almost enthusiastic advocate of the development of wireless in Australia. That has not always been his attitude. I do not propose to delay the House by quoting some of his very spirited criticisms of the beam system. He became very enthusiastic about the high-power system when it seemed that the Government was likely to adopt the beam system. He referred at that time to the far-sightedness of the British Government in establishing the Rugby station, and urged us to establish a similar station. Everyone knows, however, that the Rugby station was out of date before its actual completion. The whole position has now changed, and the beam system has achieved a triumphant success. The prognostications of the honorable member for Batman have not been realized. The other matters he dealt with relate to the coastal stations and the terminal charges, about which I spoke in my second-reading speech. In referring to the 1924 agreement, the honorable member for Batman said that it was entered into for the purpose of relieving the Amalgamated Wireless Australasia Limited of its obligations. That statement which was made when the agreement was before the House, cannot be substantiated, as the only obligation of which the company was relieved was one which the British Government by its action rendered it impossible to 41,1 f; Under the agreement, Amalgamated Wireless Australasia Limited had to provide for a reciprocal station in Great Britain, but the British Government re- fused in any circumstances to grant a licence to any one to establish such a station. The honorable member also stated that in order to get the beam system in operation, the Government had made arrangements, with Amalgamated Wireless Australasia Limited, and that that is now embodied in this agreement. That is totally opposed to the facts. The only arrangement the Government made with the company to get the beam system started was that we allowed the money to be paid by way of terminal charges to be held in suspense in a trust fund until the whole matter was settled. That is rather a different arrangement. There is no need for me to delay the House by dealing with other criticism offered. No case has been made out on behalf of the Opposition. But I wish to refer to the suggestions made by several honorable members to the effect that the Government should assume control of wireless. The royal commission’s report has been referred to and quoted as a document supporting such a proposal.
– Honorable members from both sides have quoted the report in support of their case.
– Then I shall act as umpire on the matter. A paragraph in the report reads -
Another suggestion was direct control of broadcasting stations by the Government.
In our opinion such a system is inadvisable, as experience already shows that when Governments are placed in charge of the means of disseminating news, they are apt to use such, means for the purposes of political propaganda.
Moreover, such a system would deprive the public of the benefit of the incentive ‘which the present regulations give to the broadcasting stations to maintain an effective and satisfactory service.
That can hardly be taken as an enthusiastic endorsement of Government control. The commission also said : -
Nationalization of the beam service has been suggested. This would, if practicable, be a solution of some part of the problem, but would not do justice to the persons who are jointly interested with the Commonwealth in this venture. Further, it would deprive the service of the initiative which private enterprise enjoys. The beam service has only recently been established, and there are already indications of further improvements being possible, and the public should bc in a position to immediately command the use of these improvements.
Those are only two extracts, but they show that there is no possible justification for the contention that the report of the royal commission supports the idea that wireless should become a government instrumentality. The course the Government is following is really that which has been laid down by the commission. It advised us to take over the shares of Amalgamated Wireless Australasia Limited if we could not make’ arrangements with the company in regard to royalties. But we have made an even more satisfactory arrangement. We told the company we would take over its shares if it did not pay the terminal charges. It has agreed to do so, and, consequently, we are not taking over its shares. There is no case for me to answer. There is nothing in the recommendations of the royal commission to support the contention that the Government should take over wireless and run it as a government instrumentality, and I am perfectly certain that the House will endorse the agreement in the schedule to this bill.
– I rise to make a personal explanation. It has been said during this debate by several speakers, including the Prime Minister (Mr. Bruce) and the Postmaster-General (Mr. Gibson), that I have, not once but frequently, prophesied that the wireless system foreshadowed by the Government scheme would never become effective. I have denied that on many occasions and stated the contrary, but I shall content myself at present by quoting my own words of the 11th August, 1926. They are as follow: -
The Postmaster-General seems to labour under the quite erroneous impression that I have somewhere said that the service which Amalgamated Wireless Australasia Limited has undertaken to give to Australia can never at any time be accomplished. I should be very foolish to say that, and’ certainly would be the last to presume to set limits upon scientific advancement in that or any other department of knowledge.
– I did not suggest that.
– I am glad to have that assurance. If the Postmaster-General clearly understands me as having said that, in 1922, when this company entered into certain covenants to give us a wireless service, there were no scientific dat» that could justify any such covenants’, I am satisfied. If he agrees with me when I Bay that, when it broke its agreement in 1022, there were still no scientific data upon which the company could enter into further covenants to give the same or a similar service in 1924, then I am satisfied as to that breach also. And if he admits that there are still no scientific data upon which this company can guarantee an effective service during this year, then I am satisfied that my cose has been completely established up to date. I have not the slightest doubt but that it will be for me next year to point out that Amalgamated Wireless Australasia Limited is still in default.
At that time the Postmaster-General had stated that the final date on which the service was to be inaugurated would be October in that year. Even at that moment I prophesied that at the beginning of the following year I could still say that the company would still be in default ; and every statement I have made on this point has been justified by history.
Question - That the bill be now read a second time - put. The House divided.
Majority . . . . 11
Question so resolved in the affirmative.
Bill read a second time.
Clause 1 agreed to.
Motion (by Mr. Bruce) agreed to -
That the House at its rising adjourn unti 10 o’clock a.m. to-morrow.
House adjourned at 11.12 p.m.
Cite as: Australia, House of Representatives, Debates, 8 December 1927, viewed 22 October 2017, <http://historichansard.net/hofreps/1927/19271208_reps_10_117/>.