House of Representatives
9 July 1930

12th Parliament · 1st Session

Mr. Speaker (Hon. Norman Makin) took the chair at 2.30 p.m., and offered prayers.

page 3869


Resignation of Mr. Theodore


– I rise to make a. personal explanation. This morning I received a message from Mr. Hartley Fahey, a member of the Queensland bar, stating that I had been misinformed in regard to his having attended a conference in Brisbane on Monday in reference to the report of the Royal Commission on the Mungana Leases. My statement was based on a telephone message received yesterday from a Brisbane solicitor that Mr. Fahey conferred with Messrs. Real and McPherson. Having been assured that Mr. Fahey was not present, I take this opportunity to correct my statement.

page 3870




– Will the Prime Minister inform the House what is happening in regard to the sum of £1,000,000 to be made available by the Commonwealth to the States for the relief of unemployment? Has South Australia received its quota ; if not, what is the reason for the delay?

Minister for External Affairs · YARRA, VICTORIA · ALP

– The money was to be made available in the new financial year, as soon as the States applied for advances in respect of works to be put in hand. Last week I sent a letter to all the State Premiers stating that the money was available, mentioning the amount allotted to each State, and asking to be advised as goon as possible of the nature and location of works to be put in hand, and the amounts to be expended on them. Until yesterday no reply had been received. As soon as the States supply the Commonwealth with the necessary information the money will be made available.


– Does the Government intend to check in any way the works upon which this money will be expended by the State Governments? Will the Prime Minister consider the advisability of requiring that such works be approved by Mr. Gunn, or some officer of the Development and Migration Commission ?


– The purpose of the letter addressed to the State Premiers was to establish a check on the relief works to be undertaken. The Commonwealth Government stipulated that the works must be in addition to other works undertaken by the States out of their own resources for the relief of unemployment. In addition to the other particulars I mentioned, the Government desires to know what proportions of the expenditure will represent labour and material respectively, so that it may judge of the extent to which employment will be provided.

page 3870



Investigation by Mr. Coleman.


– The Canberra Times of to-day published the following cablegram: - .


Mr. Coleman Investigates.

London, Monday.

Although screened from the British press to which he was “ not in,” Mr. Percy Coleman received representatives of the Australian press at Australia House.

Mr. Coleman said: “The assistant secretary of Australia House is facilitating my investigations. I will spend at least a month in sifting the department which has never been done previously. So far I have not formed any opinions, but publicity, coordination and the High Commissioner’s offices are the primary subjects.”

Will thePrime Minister say what is the nature of the investigation that Mr. Coleman is making, what expenses he is drawing for this work, and on what date he is due to return to Australia? .


– Before Mr. Coleman left Australia to attend the International Labour Conference, Iasked him, as chairman of the Public Accounts Committee, to inquire into the organization of Australia House, so that his report would be ready for me when I arrived in London. The Government is not convinced that Australia House is being conducted as economically as it might be, but is not in a position to come to a decision without a detailed inquiry. At least a preliminary investigation is being made by Mr. Coleman, and it will be followed up when I reach London. If economycan be effected without interfering with efficiency that will be done. While Mr. Coleman is making this investigation he will draw expenses at the same daily rate as he received as a delegate to the International Labour Conference. The duration of his absence from Australia does not concern the Government. Any time spent abroad other than in attending the conference and investigating the administration of Australia House will be at his own expense.

page 3871




asked the Minister for Defence, upon notice -

  1. How many official and private aerodromes exist in Queensland, and where are they located ?
  2. Is it a fact that the ground arrangements on some of the aerodromes leave much to be desired?
  3. If so, what action is being taken to remedy this defect in the matter of ground arrangements ?
  4. How many of these aerodromes have telephone facilities?
  5. With a view to assisting visiting pilots to obtain communication with adjacent towns, will he consider the advisability of installing telephones at each aerodrome?

– The answers to the honorable member’s questions are as follow : -

  1. The Commonwealth Government has established nineteen aerodromes in Queensland, located at the following towns: - Brisbane (Eagle Farm), Blackall, Camooweal, Charleville, Chinchilla, Cloncurry, Cunnamulla, Duchess, Longreach, Mackinlay, Mangalore, Morven, Mount Isa, Normanton, Soma, Tambo, Toowoomba, Winton, Wyandra. In addition, the Commonwealth Government has established and marked nine emergency landing grounds on the Brisbane-Charleville aerial route, and fourteen emergency landing grounds on the Cloncurry-Camooweal aerial route. There are four licensed public aerodromes in Queensland, located at Dalby, Rockhampton, Townsville,and Nanango. Local governing authorities at Maryborough, Bowcn, and Mackay are also taking action to provide municipal aerodromes. The preparation of suitable sites is proceeding, and it is anticipated thai at an early date the selected areas at those towns will be prepared to the standard necessary to permit of such areas being licensed as aerodromes. Sites at a number of other Queensland towns have been inspected by officers of the Civil Aviation Branch, and the necessary advice given to enable local authorities to prepare such sites for aerodrome purposes.
  2. Whilst certain facilities may not be available at some of these aerodromes, it is nevertheless a fact that many of them have been developed as far as is justified.
  3. With regard to government aerodromes, improvements are effected from time to time as financial and other considerations permit. The provision of ground facilities at other public aerodromes is a matter for consideration by the proprietors of such” aerodromes.
  4. Telephone facilities exist on, or immediately adjacent to, eight of the above aerodromes.
  5. It is realized that it would be helpful to pilots if telephones were installed at all aerodromes, but the expenditure involved would be considerable, and funds cannot be provided for this purpose at the present time when there is such need for economy in departmental expenditure.

page 3871




asked the Prime Minister, upon notice -

  1. Is it a fact, as reported in the press, that the High Commissioner for Australia in London, has announced that silent pictures are of no further practical use as propaganda for screening in Australia House, and that he strongly advised the production of sound or talking pictures?
  2. With reference to the proposed film tax, is it the intention of the Government to do something practical in the direction of encouraging the production of Australian talking pictures; if so, what are the proposals?

– The answers to the honorable member’s questions are as follow : -

  1. The position with regard to Australian publicity by means of cinema films is dealt with by the High Commissioner on pages 76-77 of his report for the year 1929, which was tabled in this House on the 28th May. The High Commissioner referred to the position brought about by the advent of sound pictures and stressed the desirability of such pictures being obtained for publicity purposes. While the introduction of sound pictures has perhaps restricted the opportunities available for the exhibition of silent films, I am advised by the Department of Markets that films descriptive of Australian production and scenery, produced by the cinematograph branch of that department, are shown in about 2,000 picture theatres in the United Kingdom, and that this is said to be the widest release yet obtained for the films of any British dominion. With a view to obtaining a still wider publicity, consideration is being given by the Department of Markets to the question of the production of sound pictures.
  2. The proposed film tax will be considered when the Income Tax Assessment Bill is being debated, and any practical suggestions that the honorable member may make will be given every consideration.

page 3871



MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

asked the Treasurer, upon notice -

  1. Is it a fact that the United States charges Great Britain 3 per cent. for its loans; if not, what are the rates charged ?
  2. What are the rates, maximum and minimum, charged to Australia by Great Britain on war loans, and loans for the upkeep and maintenance of our soldiers when abroad ?

– The answers to the honorable member’s questions are as follow: -

  1. The interest charge agreed upon was 3 per cent. for the ten years from 1923 to the end of 1932, and 3½ per cent. thereafter for a period of 52 years, when the loans will have been repaid.
  2. Thewhole of these moneys have been dealt with in the funding arrangement with the British Government, and the average interest charged is £4 18s. 4d. per cent.

page 3872




asked the Minister for Home Affairs, upon notice -

  1. How many acres of the Federal Capital Territory have been transferred, or have otherwise been made available, to the Forestry Department, giving the dates and approximate locations of same?
  2. How many acres of such lands have been planted with timber-producing trees?
  3. What is the area under pinus insignis?
  4. What is the area under old timber trees, and what other timber trees have been planted?
  5. What is the present market value of pinus insignia timber per cord or per ton?
  6. What has been the cost per acre of the various areas planted?
  7. What further areas are to be planted, and when?
  8. Have such areas yet been resumed, and when ?
  9. If they have not yet been resumed, when and how is it proposed to resume them?
  10. When is it proposed to harvest each area already planted?

– Inquiries are being made, and the honorable member will be advised as soon as possible.

page 3872



Pay - Pensions

MELBOURNE, VICTORIA · ALP; FLP from 1931; ALP from 1936

asked the Minister for Defence, upon notice -

  1. What are the salaries paid in the Australian Navy to the following officers, if such exist: - Admiral of Fleet, Admiral, ViceAdmiral, Rear-Admiral, Commodore, Captain of Fleet, Engineer Rear-Admiral, and Engineer Captain ?
  2. What pension, if any, for Australian service, are such officers entitled to?
  3. Are any of such officers receiving Imperial pensions in addition to the salaries paid in Australia: if so, what are the names of the officers and the amounts of pension received?

– The information is being obtained, and a reply will be furnished to the honorable member as soon as possible.

page 3872




asked the Minister for Trade and Customs, upon notice -

What were the exports from Australia of agricultural machinery for the year 1929-30, specifying (a) the number and class of machinery exported, (b) the total value of each class of exports, and (c) the country of destination of exports ?

Minister for Trade and Customs · MARIBYRNONG, VICTORIA · ALP

– The information sought for the year 1929-30 will not he available for some considerable time. The figures published for the year 1928-29 are contained in a very convenient form on pages 104 and 105 of the Overseas Trade, Bulletin No. 26. A copy of the pages containing this information will be handed to the honorable member.

page 3872




– On the 2nd July the honorable member for Corangamite (Mr. Crouch) asked me the following questions, upon notice -

  1. Has his attention been drawn to the statement of the Acting Minister for Agriculture of Victoria (Hon. R. Pollard) that, in spite of experiment and research by his department for over 40 years in tobacco cultivation, it has been totally ignored, and its cooperation not sought by the federal tobacco expert, Mr. C. M. Slagg?
  2. Has Mr. Slagg advised the isolation of the tobacco farms in the Pomonal district within a 50-mile radius?
  3. Did he consult or in any way communicate with the Victorian Agricultural Department in this matter; if so, in what way?
  4. Is there any friction between the Victorian tobacco advisers and Mr. Slagg?
  5. Will Mr. Slagg be advised to co-operate more fully in future with the State tobacco authorities ?

I am now in a position to furnish the following reply: -

  1. I have seen a report which appeared in the press regarding tobacco investigations in Victoria. 2 and 3. The proposal that some isolated small district, preferably Pomonal, be selected for experimental control of blue mould on a district-wide scale was suggested by Dr. B. T. Dickson and Dr. H. R. Angell, of the Council for Scientific and Industrial Research, who are co-operating with the Tobacco Investigation. After correspondence between the Director of Tobacco Investigations (Mr. Slagg) and these gentlemen, it was agreed to place the matter tentatively before the Pomonal Tobacco-growers Association to ascertain whether its co-operation could be secured. The matter was accordingly placed before the Association by Mr. Slagg, by letter; but it was emphasized that the proposal was tentative only. The association subsequently intimated that it would be prepared to co-operate. I am informed that Mr. Slagg did not consider it desirable to discuss future work with the State Departments of Agriculture until the executive committee of the Australian Tobacco Investigation had had an opportunity of considering the tentative plans for the work of the Investigation (including the Pomonal project) in 1030-31. This position has been explained to the Victorian Minister for Agriculture by Mr. Slagg. The executive committee, at a meeting held on the 1st July, decided to postpone consideration of all plans for future experimental work until definite information as to the continuance and support of the Australian Tobacco Investigation was available.
  2. I am not aware of any friction between the authorities mentioned.
  3. See answers to Nos. 2 and 3. I am advised that, subject to a decision being arrived at by the executive committee regarding plans for work for 1930-31, it was intended to discuss all of the experimental work in the various States with the respective State Departments of Agriculture.

page 3873




– On the 3rd July, the honorable member for Boothby (Mr. Price) asked the Minister for Markets and Transport the following question, upon notice -

Is he in a position to furnish the following information in connexion with the State of South Australia for each of the last three years: - (a) The total production of butter in factories and on farms ; ( b ) the total butter consumption of the State; (c) the total amount of butter imported from other States; (d) the total amount of butter exported overseas from South Australia?

I am now in a position to furnish the following information in reply to the honorable member’s question: -

page 3873


Attorney-General · BATMAN, VICTORIA · ALP

– On the 18th June, the honorable member for Martin (Mr. Eldridge) asked for information as to how many compositions, assignments without sequestration and deeds of arrangements under Parts XI. and XII. of the Bankruptcy Act, respectively, have been filed for each month from July, 1929, to date, and what were the occupations and total amounts involved. I informed the honorable member on that date that ‘he information would appear in the annual report of the Auditor-General when tabled in accordance with section 17(2) of the Bankruptcy Act. Since then I have obtained information as to the number of proceedings from 1st July, 1929, to 30th April, 1930, under Parts XI. and XII. of the act and the amounts involved. The information as to occupations is notat present available.

The particulars are as follows : -

page 3874



Order of Business


– On the 3rd July, i he honorable member for Martin (Mr. Eldridge) asked, in continuation of his question of loth May last, for particulars of the dates upon which each application to vary the Tramway Traffic Award Nos. 66 and 101 of 1925 was filed in the Commonwealth Arbitration Court, the names of the applicants and the dates on which each application was heard. I am now in a position to inform the honorable member that the particulars are as follows : -

page 3876


Appointment of Treasurer

Prime Minister · Yarra · ALP

by leave - I desire to announce thatI was this morning sworn in as Treasurer of the Commonwealth by His Excellency the Governor-General.

page 3876


Motion (by Mr. Scullin) agreed to -

That the House at its rising adjourn until 1 1 a.m. to-morrow.

page 3876


Assent reported.

page 3876


In committee: (Consideration resumed from the 8th July, vide page 3801).

Clauses 13 to 16 agreed to.

Clause 17 -

Section 25n of the principal act is repealed.


– This clause proposes to repeal section 25d which was inserted in the act in 1923. Section 25d is as follows: -

The court shall, before making any award or certifying any agreement,and in proceedings for the variation or cancellation of an award or agreement, take into consideration the probable economic effect of the agreement or award in relation to the community in general and the probable economic effect thereof upon the industry or industries concerned :

Provided that this section shall not affect the practice of the court in fixing the basic wage.

I regard that as a very important provision of the existing act. Everybody must agree, on grounds of common sense, that it is necessary to take into account the probable economic effect of an award or an agreement which is to operate as, and have the effect of. an award, in determining the relations of the parties thereto. When this section was introduced it was criticized on the ground that it would bring about a reduction of wages. Such a contention could, of course, only be supported by the argument - which was not used - that the economic situation necessitated a reduction of wages. Ear from advancing any argument of that kind, honorable members opposite contended that there should be no difficulty at all in paying the existing rate of wages. In order to avoid any misunderstanding in the matter, however, a proviso was inserted to make it clear that the section should not affect the principle of fixing the basic wage.

Honorable members are aware that the fixing of the basic wage is entirely within the control of the court. There is not in this section or in any other any provision dictating to the court a method of fixing the basic wage. That, however, did not prevent many honorable members opposite from telling the public that the object of the section was to bring about a reduction of the basic wage, and that it would produce that effect if allowed to remain on the statute-book. That, obviously, is not, and could not be, the case. It is only necessary to point to the terms of the section in order to dispose of such an argument. At the last election the people were invited to vote for the Labour party on the ground that that party would maintain, and probably increase, wages. Experience has shown how false and misleading such promises were. Despite what may be said outside in the heat of political controversy, every honorable member knows that this Parliament has no power to raise or vary wages in industries under the jurisdiction of the Commonwealth Arbitration Court. It can deal only with the wages of Commonwealth public servants; it cannot interfere with the wages paid to other individuals.

Mr Keane:

– We did not promise higher wages.


– It is interesting to have that information. At any rate, the honorable member’s party certainly promised to maintain the existing rate of wages.

Mr Keane:

– That is so.


– The point I am making is that this Parliament is absolutely incompetent even to maintain existing rates of wages. Recent changes in the cost of living figures have caused the basic wage to be reduced by 4s. per week in Melbourne, 3s. 6d. in Sydney, 3s. in Adelaide, 2s. 6d. in Brisbane and Hobart, and ls. in Perth. Neither this nor any other Federal Government could do anything, under our present limited constitutional powers, to prevent that reduction from taking effect.

Mr Gabb:

– It is not an actual reduction of wages at all.


– What the honorable member for Angas (Mr. Gabb) says is, in a sense, quite right. The reduction has been brought about by an alteration of the cost of living figures. The fact is that this0 Government, even with its large majority, is not able to add a penny to, or take away a penny from, the basic wage. Therefore, there was no foundation whatever for the implied promise behind the huge placard that was displayed in Martin-place, Sydney, during the last election campaign, calling upon the citizens of the Commonwealth to vote against reductions of wages and salaries. Under our present limited constitutional power this Government cannot increase, nor even maintain, existing rates of wages. Wage rates are fixed by the Arbitration Court. Yet, as the honorable member for Bendigo (Mr. Keane) has been frank enough to admit, the Labour party went to the country in the last election campaign on the policy of the maintenance of existing wages. If the result of the election had been different from what it was, and honorable members opposite had been sitting in opposition at the time the reductions to which I have referred took effect, they would probably have blamed the Government for reducing wages, although’ there was, in effect, no real reduction. Honorable members opposite would not, under those circumstances, have distinguished between real and nominal rates of wages. We should have been told ad nauseam that the working man in Sydney now had 4s. a week less to spend than formerly. It should be frankly admitted by every honorable member that rates of wages do not depend upon the industrial legislation put before this Parliament, but upon the decisions of the Arbitration Court. But no industrial tribunal can do more than declare what is a possible wage under existing conditions. The existing conditions are behind every industrial determination, and put the limit on wages, profits, rents, interest and everything else that enters into the making of incomes in Australia. It is high time for us to recognize that wages come from successful industry, and from nowhere else. I agree that this Parliament may produce profound effects by its tariff policy, and its taxation, bounty, and other legislation. Naturally, when the financial’ and economic position alters, wages are affected. This Parliament may, by its legislation, exercise a great influence upon the prosperity of the country; but the influence is less than is generally supposed, because most of our legislation in regard to industry and trade and commerce operates rather in the direction of inhibition than of assisting progress. There is legislation, of course, which may, and does, actively aid industry; and by passing such measures this Parliament may indirectly help to preserve and improve our standard of living. But Parliament cannot itself legislate upon the subject of wages. I suppose it is useless to express the hope that, while our constitutional power remains as it is to-day, no more elections’ will be fought on the wage issue.

What is the actual position with respect to wages in Australia to-day ? The figures covering the period ending the 31st March last - I am unable to use the figures to the end of June, for I have not been able to obtain them - show that, owing to various unfortunate economic and financial conditions, which honorable members on both sides of the chamber deeply deplore, about 15 per cent, of our workers are unemployed. This means that the wage fund is 15 per cent, below what it would be if every worker were in employment; though I do not suggest that every worker ever is in full employment. A proportion of workers is always out of work, owing to natural changes in industry, the completion of jobs and the like. A certain amount of unemployment is inevitable under any conceivable social order. But at present there is more unemployment than there has probably ever been since Australia became a fairly fullydeveloped industrial and primaryproducing country. This Parliament can do little to relieve that unemployment except by making grants in relief. Grants such as the £1,000,000 grant for road work have to be found out of revenue. This means that A, B, and C have to find an additional amount of money in order that relief work may. be provided for D, E, and F. Probably every honorable member will admit that the making of such grants is not a permanent contribution to the solution of the problem of unemployment. It must be obvious that the man who has. to pay high taxation is, to that extent, less able to provide employment. I suppose every honorable -member knows that already, owing to increased taxation, men are being dismissed in various parts of Australia. This is because their employers are no longer able to find money to pay their wages. If taxation is further seriously increased, there must be additional dismissals for the same reason. It is on that account that I say that the relief of distress - and we all agree that relief must be provided - does not in itself do anything to solve the unemployment problem. Much more radical measures will have to be adopted to do that. I suggest, therefore, that this committee ought to cease wasting its time in discussing actual wage rates, and the necessity for increases or reductions of wages, iis if it had any power to deal with them. I have a very decided view on the matter of the’ increase or reduction of wages. Various persons have asked me what I think about it, and I have given them all the same reply. I have said to employers, in particular, that, as a general rule, when the employees wanted increases of wages they, went to the tribunals and asked for them. That has been the practice in Australia for many years. If any employers consider that they are unable to carry on their industries under the existing wage rates, the course before them is obvious. Let them also go to the tribunals, and show that they are not able to pay the wages demanded. I can conceive of few bodies less fitted to discuss wage rates in particular industries than this or any other Parliament. If either aide in industry requires an alteration in wage rates, it ought to go to the tribunals ; the matter is not one with which a politician should deal. I do not profess to have that acquaintance with the details of particular industries which would alone justify me in saying that there ought to be an increase here or a decrease there.

Mr Gabb:

– This bill does not provide that Parliament shall settle wage rates.


– I have not even remotely suggested that it does. The honorable member has failed to follow me. I have said again and again that this Parliament has no power to deal with wages except in the case of Commonwealth employees. Honorable members on the other side went to the last election with a promise to maintain existing rates of wages, but they have not carried it out, mid cannot do so. We must recognize that all returns to industry, whether in the form of profits or wages, or any other returns, are determined by economic conditions, and when the flow of borrowed money, particularly, has ceased, it is impossible for’ industry as a whole to pay wages or provide profits beyond the economic possibilities of industry itself. There is no other fund ‘ than theproceeds of industry itself from which either wages or profits can come. It is true that one industry may receive special favours over others, but industry as a whole cannot be given special favours. I submit to the committee that it is the duty of the Arbitration Court to make its awards within the limits of existing economic conditions.

Mr Keane:

– Which it always does.


– If that is so, there can be no objection to section 25d remaining in the act. One reason why it was inserted was that Mr. Justice Higgins had said, even when he spoke of the basic wage being sacrosanct, as a general rule, though not as a universal rule, that everybody had to recognize that economic possibilities determined wage possibilities. But he also said clearly, and I agree with him, that a particular employer, who, by reason of unfavorable conditions ov defective management or the like, was unable to pay the basic wage which was fixed as fair, having regard to the need for providing a reasonable standard of comfort for the workers, should not be allowed to pay a wage lower than the basic wage, and it would be better for him to cease being an employer. Mr. Justice Higgins recognized that, for industry as a whole, even the basic wage must be determined in the long run by economic conditions. In another case, however, Mr. Justice Powers took an entirely different view. To paraphrase his remarks, he said that he would award the wages and the conditions which he thought fair, and he added that if an industry was unable to give them it was not his business, but the business of Parliament. He stated that it was the duty of Parliament by means of a tariff, a bounty, or a similar provision, to alter the economic conditions to fit the wages and other working conditions prescribed by him.

The section under consideration was drafted from an entirely different point of view. It was founded upon the view taken by Mr. Justice Higgins and not upon that of Mr. Justice Powers. It appears to me impossible to allow an Arbitration Court judge to dictate the policy of Parliament, and to fix rates of wages and conditions that an industry admittedly cannot pay, thereby forcing Parliament into some act of .policy with regard to that particular industry. On the other hand, the view which I submit as sound is that wages must be fixed in relation to the economic conditions of the country as a whole. I think that everybody will admit that the basic wage rate should be fixed in relation to the standard of comfort set up by Mr. Justice Higgins and other industrial authorities. I do not know that there has been a serious suggestion, up to the present time, that there is difficulty in adopting that standard in fixing the basic wage in Australia. It is quite wrong for an arbitration court to go on awarding marginal rates and conditions, which some employers tell me are often more important from the cost point of view than wages, regardless of economic facts, and to impose on this Parliament the duty of giving special consideration to certain industries. Parliament ought to look at the wages and conditions fixed, and, if an industry is unable to give fair wages and conditions, Parliament should act: but the Arbitration Court should not dictate the economic policy of the country. Section 25d contains a principle that is sound and cannot reasonably be contested. I propose, therefore, to oppose the clause when, is designed to repeal it.

Mr brennan:
AttorneyGeneral · Batman · ALP

[3.9]. - The Government intends to ask the committee to support the clause, and thus repeal a section which is considered by the Government to be obnoxious. The section proposed to be deleted reads as follows: -

The court shall, before making any award or certifying any agreement, and in proceedings for the variation or cancellation of an award or agreement, take into consideration the probable economic effect of the agreement or award in relation to the community in general and the probable economic effect thereof upon the industry or industries concerned. .

Then follows the proviso -

This section shall not affect the practice of the court in fixing the basic wage.

It is a matter of history - though it is not material to my argument - that that proviso was the most that the Opposition, then the Labour party, could gain as the result of its unqualified objection to the insertion of the provision as a whole ; so much was conceded to its earnest advocacy.

I direct attention, in association with this clause, to section 25, which reads -

In the hearing and determination of every industrial dispute, and in exercising any duties or powers under or by virtue of this act, the court or Conciliation Commissioner shall act according to equity, good conscience, and the substantial merits of the case, without regard to technicalities or legal forms, and shall not be bound by any rules of evidence, but may inform its or his mind on any matter in such manner as it or he thinks just.

It is very seldom, in any jurisdiction, that a judicial officer has so wide a roving commission, so much being left to his unrestrained discretion. I ask honorable members whether they believe that those wide powers exclude the power - and, if the judge so thinks, the duty - to explore the economic consequences of an award upon the industry or industries concerned. Surely it must be perfectly obvious that the judge .is empowered by that provision, precisely insofar as he thinks just, to assess economic consequences, not only upon the industry immediately concerned, but also upon every industry that is even remotely affected, and to explore every phase of economics that he cares to consider for the purpose of giving a just award in accordance with equity and good conscience. Is it not perfectly obvious that the Leader of the Opposition (Mr. Latham) deprecates the very course that, he himself has practised, that of importing politics into language which should be descriptive of the judicial functions of an arbitration judge ? For 24 years this court operated without any reference whatever in the act to what have been described as economic consequences. During that time great men have presided in this jurisdiction. I need recall only such names as those of the late Mr. Justice O’Connor, the late Mr. Justice Higgins, Sir John Quick, and others, who have administered the act in the past without any references in it to economic consequences, but having constantly before them their wide charter of powers to explore all the consequences of any award that they might make. In 1928 it suddenly occurred to my honorable friend, the Leader of the Opposition, that for the first time it became the duty of the Attorney-General to lecture courts, and to direct them as to what should influence their mind in making an award in this jurisdiction. I have been accused . of attempting to lecture the Opposition. I have never ventured to do so, and have not felt myself equipped- to do it. Certainly I have never attempted to lecture the judiciary. The Leader of the Opposition has not yet accepted a seat upon the bench ; and I venture the opinion that the high office which he holds in this Parliament does not qualify him to lecture the judiciary and to direct their minds as to what they shall consider in making awards upon evidence that has been submitted to them. That is a matter entirely for their discretion, not for the discretion of the Opposition. It is not within the province of the Opposition to attempt to keep them in leading strings. The court hears the evidence; it sees the parties; it has an intimate knowledge of all the facts. This Parliament is not in that position. I accept unreservedly, and agree with, what the Leader of the Opposition hast said, in destruction of his own argument - that this Parliament cannot fix wages. Nor should it direct judges. It establishes courts, and appoints judges. It then leaves to those judges the duty of carrying out the functions that have been assigned to them. Why was this section inserted in the act in 1928? The Leader of the Opposition, if I may describe the result in homely language, has “given himself away.” He pointed out that the late Mr. Justice Higgins, who was considered by many more or less ill-informed persons in this country almost as a judge who was biased in favour of the working classes, said that, notwithstanding the basic standard that he had laid down, wages must, of necessity, depend in greater or less measure upon economics. The honorable gentleman approves that dictum. Everybody, of course, knows that it was in accordance with that dictum that the late Mr. Justice Higgins administered this act for so many years, with such distinction and such conspicuous success. But it appears that, in a weak moment, Mr. Justice Powers declared that he proposed to fix a wage that was fair, and because the honorable gentleman construed the words uttered by the judge to mean that he might not pay clue regard to the economic effect of his award upon the industry with which he was dealing, or upon other industries, he thought that it was time to bring out the legislative hobbles, so as to prevent the learned judge from proceeding too fast or too far along the road that he described as the fair road.

Mr Latham:

– I do not think that the Attorney-General heard what I said on that point.


– I listened with the utmost intentness to what the honorable gentleman said, and, notwithstanding his proclivity for supposing that I fail to understand his words, luminous as they arc, I believe that I entirely grasped his meaning; sufficiently, at least, to undersr.and that one of the main reasons for the introduction of that section in 1928 was that Mr. Justice Powers had publicly declared that he intended to make an award that was fair, without regard to possible consequences that were indicated.

Mr Latham:

– The honorable gentleman said that it was Mr. Justice Higgins.


– I did. not. I pointed out that Mr. Justice Higgins had said - and that the honorable gentleman had approved of the statement - that wages were necessarily conditioned by economics. That has been my argument throughout. All the judges have admitted that it is so. The honorable member for Herbert (Mr. Martens), when speaking last night on a clause closely related to this, quoted at length from judicial utterances in support of the same obvious fact that the judges do consider the economic effect, of their awards. I did not speak last night on clause 13 which deals with agreements to be filed. The -Leader of the Opposition (Mr. Latham) has pointed out, rightly, that there is much in common between section 24 which deals with the filing of agreements between the parties and the public interest therein involved, and section 25d. But let me say that in connexion with those two provisions, the Government will not sanction any political gestures from this Parliament which are designed improperly and unfairly to influence the judiciary. I shall argue, at a later stage, that for precisely the same reason we are omitting the words, “ other things being equal “. which is a vague and general term opening up pleasing opportunities for lawyers to argue as to their meaning and implication ; words which, however they are construed, are mere improper limitations upon the discretion of the court and the judge.

Mr McTiernan:

– Whose economics?


– The honorable member may well ask whose economics, what economics, or what standards. .What does it mean ? Let us have a sitting of the Federal Court for three or four weeks to discuss what it means, subject, possibly, to the changing of views later in the same court. Because we do not wish to harness, in any way, the discretion of the judge, section 25d is to be repealed. Only the other day the Chief Judge of the Arbitration Court made a public declaration on the same subject. He pointed out that whether this provision was in or out of the act, he would have to consider economic effects in his awards. It has been suggested that these men, who are to be appointed as conciliation commissioners, or the judges who are already appointed, are likely to be weak and spineless unless a little life is put into them by these sturdy gentlemen - the guardians of public interests - who occupy seats on the Opposition side of this chamber. I have heard a great deal of misrepresentation about this clause. The honorable member for Gippsland (Mr. Paterson), the honorable member for Darling Downs (Mr. Morgan), and other honorable members have publicly declared - and their statements have appeared in the press - that when section 25d is eliminated, it will be no longer possible for judges to consider the economic consequences of any award that they may make.

Mr Paterson:

– I did not say that.


– The honorable member was so persistent in saying something very near to it that I lost my temper with him and had to be called to order. What he said was so obviously incorrect - as he would have known had he taken the trouble to read the amending bill - that itexasperated me at all events.

Mr Paterson:

– I shall, in a few minutes, remind the Attorney-General of what I did say.


– I have no doubt that the honorable member will do so. Honorable members opposite have, in the press and upon the public platform, misrepresented this party and the Government by declaring that the elimination of section 25d means the disregard of economic consequences in respect of awards of the court. The question has been asked over and over again that if this clause is so innocuous, if the judges may or may not consider economic consequences at their discretion, why make such a bother about it? My answer is that section 25d was inserted inthe act for political purposes, and to influence the judiciary improperly. For that reason it is to be repealed.


.- I do not desire to add substantially to what I said on this clause inmy secondreading speech. Like the AttorneyGeneral, I never attempt to lecture either honorable members opposite or honorable members supporting the Government, but some time ago I came across a little story in an American magazine which, I think, is apropos of this vexed question of wages and the fixation of wages. A farmer in one of the States was in need of some extra hands for harvesting work, and going into the township he met in the street a young fellow who was regarded as the feeble-minded man of the village. He broached the subject of work. He asked this young fellow, whose name was Cy. Warren, whether he would help him out of his difficulty. He wanted a few extra hands, and he asked whether Cy. would come and give him a hand. “ What wages will you pay me?” asked Cy. “ Well,” said the farmer, “ Come out with me this afternoon and I shall pay you whatever you are worth.” To that Cy. promptly replied, “ I am darned if I will work for that.” The moral of this little story is, I think, quite obvious to honorable members.


.- I support the repeal of section 25d, and agree with the Attorney-General that section 25 is a sufficient charter to the tribunal administering the act.Reading sections 25 and 25d together, one sees the possibility of most extraordinary consequences. Section 25 directs the judge to act according to equity, good conscience, and the substantial merits of the case. Section 25d provides that the court must take into account the probable economic effect of the agreement or the award. Is the probable economic effect to be something outside of the substantial merits of the case? Is the position this: That, under section 25, the court has to make an award in accordance with the substantial merits of the case, but that upon perusal of section 25d it must ignore the substantial merits of the case, and frame its award so as to take into consideration something very vague and. indefinite - its probable economic effect. The history of arbitration jurisdiction does not show any valid reason why the instruction contained in section 25d should be engrafted on to the charter contained in section 25. Section 25d reads like a slice off a political speech, and is not a proper text for an act of parliament. The court is directed by it to take into consideration “the probable economic effect” of an award or agreement. Presumably that means what the court assumes or prophesies will be the economic effect. But the actual effect may be quite different. A judge is not a soothsayer or sage, and an instruction such as is contained in section 25d merely makes his jurisdiction complex and difficult when our aim should be to make it simple and clear. Who can define the scope of the phrase “ probable economic effect “ ? Who, indeed, can define economic effect? Does “probable economic effect” cover a wider area than “ economic effect,” or vice versa ? Much will depend on the economic theory by which the court elects to - be guided. Is it to have regard to the economics of Adam Smith or Jevons, the Attorney-General or the Sydney Morning Herald, the Labor Daily or the Leader of the Opposition? If such a provision is to remain in the act Parliament should have the courage to indicate to the judge what it means by “economic effect.” Economics has been described as the dismal science. It may be defined as the learning which relates to the production, distribution and management of wealth. Who is to limit the scope of economics? Must a judge reject all ethical, moral and humanitarian considerations? The retention of this section would only perpetuate existing complexities and difficulties and create mischief. Such a text should not appear in an act of parliament, and it is not fair or courageous of the legislature to give an instruction that is so vague and indefinite.


.- It is interesting to hear the AttorneyGeneral and the honorable member for Parkes (Mr. McTiernan) defending for entirely different reasons the proposal to omit section 25d. The Attorney-General said that the phrase relating to the economic effect of an award was obnoxious and was inserted merely for political purposes; that even if it were omitted a judge would continue to take into consideration the probable economic effect of an award, and indeed another section of the act actually required that to be done. He was followed by the honorable member for Parkes who suggested that something so vague as economics, of which there were many schools, should be disregarded by the judge.

Mr McTiernan:

– That is a misrepresentation of my argument.


– The honorable member said that there were different schools of economics, which is such a vague science that it should not be referred to in an act of Parliament unless it can be properly defined. Every determination by the Federal Arbitration Court has taken into account probable economic effects.

Mr McTiernan:

– Define the scope of economic effect.


– I thought the honorable member might be objecting to the word “ probable “, but that he should contend that economic effect should not be considered at all is beyond my comprehension. Mr. Justice Higgins declared that the living or basic wage must, be within the bounds of reason, whatever its theoretical basis. Mr. Justice Powers said in 1922 that the wages to be fixed were the fairest which the industry could pay at the time. Surely that statement showed regard for the probable economic effect of the award. If, as the AttorneyGeneral has said, the court must take this factor into consideration, surely the present time is inopportune for the removal of this direction to the court. If the words are superfluous and worthless because the court does take economic effects into consideration Ave should not, by the removal of them, suggest to the court that it should disregard economic effects. A gesture of this kind is Especially to be avoided now, having regard to what people abroad are saying about Australia. The London Times of 7th May, referring to a statement by the Prime Minister in regard to the cost of production, said -

It is, of course, immaterial what Mr. Scullin subscribes tq, because the purchasing power of the workers is not a matter within his control. Wages in terms of money are one thing, purchasing power is another. ‘ The point that really concerns the workers is the exchange value of their labour in terms of the necessaries and luxuries of life. In the long run the wealth production of any country divided by the number of its inhabitants decides the average standard of living, and nothing Mr. Scullin can do will alter it. . . Meanwhile, there is no escape from the fact that if wealth production is diminished the people will have less to share. In the long run, the only remedy for Australia’s plight is increased production or goods at prices that will enable them to be sold in the world’s market.

That means that the economic effects must be taken into consideration ; whether we give a specific direction to the judge or not, the fact remainsthat the average earnings of the workers can be no more than the wealth production of the country divided by the number of workers. At a time when Australia is passing through an economic and industrial crisis and our financial position is under review we should be careful to avoid an action which may be misconstrued..


– Why does the right honorable member suggest that the court should be forced to do something which hesays it always does?


– Two years ago thehonorable member supportedthe inclusion in the act of the direction to the court to take into consideration economic effects.Now apparently he is opposed to the words remaining in the act. Perhaps he can explain the reason for his change of opinion.. A provision of this kind should always have been a part of the act. I am more concerned with the continuous employment of the workers than with the retention of nominally high wages. It is more important to have all the workers profitably employed than to have a few of them in receipt of high wages and the remainder thrown on the scrap-heap.

Mr McTiernan:

– There are plenty of workers on the scrap-heap in America, where there are no awards.


– We have heard a great deal about conditions in America, but I know that when I was there, five or six years ago, the workers were very well off, and the figures compiled by the Bureau of Statistics indicate that the purchasing power of wages in America is definitely higher than that of wages in other countries. The repeal of this section will constitute a definite direction to the judges that they need not take economic facts into consideration, when framing their awards. It must be obvious that- industry will be more prosperous, and capable of giving more employment, if it is conducted along economic lines. Those industries which are not so conducted may be buttressed by various de vices, and may even thrive for a time, but they can do so only at the expense of other industries which, in turn, must languish, and be unable to employ their full quota of workers. That is what has been happening in Australia. There is much unemployment because uneconomic rates and conditions have been prescribed in certain industries. Honorable members know that in two States of the Commonwealth it has been found impossible to pay the rate of wages fixed for rural industries, and yet in the cities the high, uneconomic rate of wage must still be paid. That is an injustice and an iniquity to the country worker which should not be tolerated.

Honorable members who favourthe repeal of this section should remember that the Queensland Labour Government, of which Mr. Theodore was Treasurer and Mr.Ryan Premier, inserted in the QueenslandIndustrial Arbitration Act of 1916 a direction to the court that it should “take into consideration the prosperity ofan industry and the efficiency of the workmen. Honorable members opposite have said that it is wrong that there should be the slightest restriction upon or direction to the judgesof the court. In the next breath they say that such directions as the bill contains are to be regarded simply as the charter of the court. Clause 8 of the Queensland Industrial Arbitration Act, as amended in 1916, is as follows: -

The court shall be entitled to considerthe prosperity of the calling and the value of an employee’s labour to his employer, in addition to the standard of living, but in no case shall a rate of wages be paid which is lower than the minimum wage declared by the court.

What is that but a direction to the court to take into consideration the economio effect of awards?

Mr Long:

– The section mentions the standard of living.


– The principles affecting the fixation of the basic wage are excluded from the scope of section 25d.

Mr Long:

– The Queensland act says that the standard of living must be taken into consideration by the court. There is no such provision in section 25d of the Commonwealth Arbitration Act.


– It is absurd to suggest that there is any intrinsic difference between the two provisions. We have been told that the object #of the bill is to promote goodwill between employers and employees, between capital and labour. Now it is proposed to make it possible to issue an award which does not take economic facts into consideration, and which may result in the destruction of an industry altogether. How can that tend to produce peace in industry, or to bring about goodwill between employers and employees!

It seems to me that this is .the worst possible time to do what is contemplated in this clause. The Attorney-General said that the repeal of the section would make no difference. A judge dealing with the graziers’ application said that the repeal of this section would make no difference to the way in’ which he would handle the case. Then what can be the advantage pf repealing the section, except, possibly, some political advantage, the gaining of which seems to be an obsession with some honorable members opposite. I urge that the section be retained.

Mr. curtin (Fremantle) [3,52]..- The right honorable member for Cowper (Dr. Earle Page) said that he was primarily concerned with the effect which the repeal of this section might have upon unemployment. He said that, in view of the existing economic situation - which he inferred had arisen because arbitration courts have not taken into consideration the economic effect of their awards - , it was imperative that we should retain section 25u in order that wages might be properly regulated and unemployment diminished.

Dr EARLE Page:

– 1 did not say that the courts had not taken economic facts into consideration; I said that the repeal of this section would be a direction to the judges that they need not take such matters into consideration in the future.


– At the direction of the Government of which the right honorable gentleman was a member, the Development and Migration Commission conducted an investigation into unemployment in Australia. That commission included Mr. Gepp and Mr. Gunn, men of very great distinction according to honorable members opposite. It made a report to the Government, and that report was fortified by a series of elaborate graphs and a specially written thesis by an acknowledged economist. At the time the report was presented, wage fixation had been practised for years in the absence of any legal direction to take into consideration probable economic effects. On page 18 of the report, the following passage occurs : -

The graph of Australia does not suggest a close connexion between the above-mentioned measure of the ratio of effective wages to productivity on the one hand, and the unemployment index number ‘on the other hand. The subject should, however, be investigated much more closely by taking quarterly figures, and allowing, .for a lag between the movements in one series and the movements in the other. There has not been time to undertake the statistical work involved in such an examination, and the subject must be left at a somewhat inconclusive stage. This much may be said, however - the assumption frequently made that high wages ib a major cause of fluctuations in employment in Australia, is not borne out by the results so far obtained in this investigation, whatever effect . it may or may not have on the average amount of ‘employment’ . over a series of years.

Dr Earle PAGE:

– I never suggested that high’ wages interfered - with employment. I hare always said’ that high wages are good.


– Yet- the honorable member seemed .to infer that this section would persuade the court t.i take into account the existing volume of unemployment when considering what should bc regarded as the probable economic, effect of its awards. Presumably every word in a statute has some meaning, but it is extremely difficult to define with any exactitude what is meant by the economic effect of an award or un agreement. J doubt whether any one, however much on little their acquaintance with -economic textbooks, can find any agreement among economists regarding lue meaning of the particular term used iii this clause. . The Encyclopedia Britannica contains a series of ably written articles on the subject of economics. The remarkable thing about them is that each economist has a conception of the science which differs in marked degree from those of the other schools of thought which he attacks. What are the probable effects of high wages! Ask any half-dozen leading economists, and when you have disposed of their reservations, qualifications, an.4 safeguards you will have reached a condition of confusion in which no one could say with any precision what the economists really mean. Their capacity for disputation is even greater than that of those honorable members who adorn the legal profession.

Mr McTiernan:

– And when, as in this section, the words “ probable economic effect” are used, it makes the possibility of confusion even worse.


– That is so. Who can say what will be the probable effect on industry even of the legislative enactments of this Parliament. What, for instance, might be the effect of an attack on the interest rate, or of an amendment of the Land Tax Act? The Leader of the Opposition (Mr. Latham) knows that every law relating to imposts passed by this Parliament will probably have some economic effect upon industry.

Mr Latham:

– That is admitted, and the probable effect is taken into considertion.


– The point I am making is that there is no constitutional direction given to this Parliament to take such matters into account when considering proposed legislation.

Mr Latham:

– I do not say that there is, but Parliament has a political obligation to the people to do so.


– This Parliament has no clearer conception of its duty, and is not better equipped intellectually to judge the economic effects of its legislation, than is the Arbitration Court to determine the economic effect of its awards. There must naturally be variety of opinion regarding such a highly speculative subject as economics. It cannot be described as an exact science, and opinions vary as the major data concerned alters in character.

Mr Maxwell:

– That is because of the human equation.


– Exactly ; and honorable members opposite would do well to bear in mind that the economic writers of to-day now consider moral principles and moral consequences to be of very great importance. The “economic man,” therefore, must be regarded as being more than an abstract unit in the science of economics.

Mr Maxwell:

– Does the honorable member suggest that judges do not now take into account the economic effect of their awards?


– I make no suggestion as to what judges do or do not take into account. They are obliged, as the Attorney-General (Mr. Brennan) has pointed out, to “ act according to equity, good conscience and the substantial merits of the case.” Surely that is a sufficient instruction for this Parliament to give a judge who is to make an industrial award. The Leader of the Opposition paraphrased a statement of the late Mr. Justice Higgins to the effect that there was no obligation upon the court to take into account an individual employer who could not conform to the standard of wages laid down for his particular industry. After all there are fundamental human rights which should be considered in the assessment of wages.

Mr Latham:

– That is what I said.


– Any industry or group of industries which cannot pay the wage which the court has fixed as a reasonable minimum wage to enable a worker to discharge his responsibilities to his wife and family, should be put in the same category as an individual employer who, on account of economic difficulties, or the failure to develop his industry adequately along technical lines, or the superior competitive basis of. the same industry in other countries, is unable to pay the prescribed wages. Mr. Justice Powers wisely said that he would not permit an industry, because of its competitive disability, or lack of development, to become a parasite upon the workmen employed in it. He insisted that an industry should provide a reasonable standard of subsistence for the workers in it. If it could not pay the wages fixed by the court, His Honour said that Parliament would have to formulate some policy to give it sufficient assistance to do so or permit it to die. If an industry died in those circumstances it might not be a loss to humanity. I hold, as I have declared on several occasions when our fiscal policy has been under discussion, that this nation should import her requirements in particular directions when they cannot be produced in Australia under conditions which will permit us to compete with the mass production, or other methods employed by the same industry in other countries, in preference to producing the goods here by the payment of a wage which denies the worker a reasonable standard of living.

The section which it is proposed to repeal must have been put in the act for some definite reason. It suggests that the judge should pander to the inefficiency of certain industries in this country. It must be apparent to everybody that every employer who isnot receiving a certain rate of profit from his industry will urge the Court to prescribe a rate of wage that will permit him to increase his profits. The argument that this section should be retained because it dogs not apply to the basic wage is unsound. The Australian basic wage is approximately £48s. per week. To that sum certain additional amounts are added as margins for skill. These vary from 6d. to 2s. per day. During the last twenty years the Arbitration Court awards have protected the basic standards of the unskilled workman, have but deprived the skilled workman of the marginal rates to which his skill entitles him. If economic conditions have not been taken into account in fixing the basic wage they certainly have been considered in fixing the marginal rates for skill.

The words “ probable economic effect “ are ambiguous for they justify one judge in apprehending economic effects in a manner entirely different from that in which another judge apprehends them. A decision as to the “probable economic effect “ of an award upon industry would be influenced by the evidence presented in particular cases, and the statements made as to profits, earnings, mechanical equipment, turn-over, and so on. But there is the further objection that the judge is directed to take into account, not only the “ probable economic effect “ of an award upon the industry itself, but upon the community in general. How that can be done in any satisfactory way I do not know. Would a judge be entitled to take into account the effect of certain increased taxation imposed by a government for the purpose of adjusting its financial difficulties in a time of stress? Everybody knows that to-day the interest charges and the public debt of this nation are persistently rising, while the general revenue and the returns from various government business instrumentalities are falling. Would an employer be entitled to ask the court to take these facts into consideration in fixing wages? Increased taxation, increased interest charges, and the like, must affect the prosperity of a business man; but, if a judge accepted this as a sound argument for reducing the wages of the workers, it would be most unjust, for the workers would then be subjected to two forms of taxation. They would have to pay the taxation imposed on them directly by the Government, and also the taxation imposed on them indirectly by the court in the shape of reduced wages. That would be a monstrous state of affairs.

It has been said that, if this section is repealed, it will, in a sense, be a direction to the court. If that is so, we are entitled to argue that the insertion of the section in the act two years ago was also a distinct direction to the court. What was intended by honorable gentlemen opposite when they put this section in the act two years ago ? For 24 years the act had been in operation without it. The court was under an obligation to “ act according to equity, good conscience and the substantial merits “ of every application made to it; but honorable members opposite were not satisfied with that, and inserted this indefinite term. They remind me of the father who, on a dark and stormy night, when the children will not keep quiet, uses additional means to frighten them. I submit that this section was placed in the act in order to convey to the court a distinct and emphatic instruction that the time had arrived to re-adjust wages. The Leader of the Opposition (Mr. Latham) said, in the course of his speech, that the Labour party had asserted during the last election campaign that it would maintain, and even increase, wages. I never made such a statement and I doubt whether any honorable member on this side of the chamber did so.

Mr Latham:

– The placards made the statement.


– The Leader of the Labour party said, in his policy speech, that, if Labour were returned to power, it would endeavour to maintain the standard of living in this country.

Mr Latham:

– Everybody wants to do that, and the honorable member knows it.


– The method of doing it provided in this section is extraordinary.

Mr Archdale Parkhill:

– The Attorney-General (Mr. Brennan) says that the effect of this section will remain even if the section is repealed, so why repeal it?


– The index figures show that in the last two years the judges of the court have taken definite cognisance of the economic effect of their awards upon industry, because the margins for skill have retrogressed seriously. If honorable members are under the impression that there have been no wages cuts in Australia in recent years, except those necessary to adjust wages to the 1907 price levels, they are under a serious misapprehension. The basic wage has been maintained at that level, but the judges of the court have made distinct and ruthless slashes at the wages payable to skilled workers. Those wages have been substantially reduced.

Dr Earle Page:

– Will the repeal of this section alter that state of affairs?


– I hope so. The attack upon the wages of the skilled workmen of Australia has already gone too far. This section of the act has been applied exclusively to our skilled employees.

Mr Maxwell:

– What effect does the honorable member think that the deletion of this section, would have?


– It would involve, as the Leader of the Opposition has said, the revival by the court of the practice adopted by Mr. Justice Powers of fixing a basic wage which the court, after hearing the evidence, believed to be fair.

Mr Latham:

– Irrespective of economic conditions ?


– Will the honorable gentleman tell me what he means by “ economic conditions “ ?

Mr Latham:

– I refer the honorable member to the report on child endowment by a royal commission of which he was a member.


– What is wrong with that?

Mr Latham:

– It is a very good report, but very different from the honorable member’s present speech.


– That report makes no suggestion that economic conditions should be taken into account in fixing the basic wage. It does say that the consideration of social reform proposals by Parliament would be helped by a study of economic possibilities.

Mr Latham:

– But it shows that an economic research bureau would be valuable, particularly in relation to industrial -matters.


– During the period that the section under consideration has been in the act, the judges have acted upon it to the detriment of the margins provided for in the awards that previously operated. Owing to the panic that the section has caused, substantial reductions in wages have been made. I believe that the judges take notice of what is done in Parliament. The Arbitration Court is entirely different from every other court, and its judges endeavour to interpret the policy of Parliament with respect to wage fixation and the standard of living. , “ The standard of living “ is a nebulous term, which it is very difficult to define; but, with this section in the act, it becomes doubly difficult to define it. I submit that the section serves no. useful purpose. It has had an intimidating effect, and if the judges are merely required to fix wages from the point of view of equity, good conscience, and the substantial merits of the case, sufficient intimation will be given to them of the principles which Parliament thinks should be taken into consideration by them in making awards.

Mr. nairn (Perth) [4.18].- Previous speakers have referred to the uncertainty of professors on the subject of economics, but the section appears to give no direction to the court to enter upon a general consideration of economics in the abstract. The direction is that in making an award, or in certifying an agreement, the court shall take into consideration the probable economic effect of the award or agreement in relation to the community and to the industry concerned. Anybody who wishes to understand that section may do so merely by reading it. Obviously, there is simply a direction to the court to have regard to the wage that an industry can fairly pay, considering the interests, not only of the parties concerned, but also of the consumers generally. That is a very simple direction, and, until the honorable member for Fremantle (Mr.. Curtin) had spoken today, I had understood that that practice had been followed by the judges for twenty years or more. The AttorneyGeneral assured us that the deletion of this section would have no effect whatever, and that the court would, as before, have regard to the economic facts; but the honorable member for Fremantle tells a different story. When asked what he expected would be the result of the deletion of the section, he said that the court would adopt the principle enunciated by Mr. Justice Powers which resulted in the insertion of this provision in the act. That judge claimed the right to fix what lie considered a fair wage regardless of whether or not industry could afford to pay it. I remind honorable members that Australia has been losing her industries, one by one, for years, and almost entirely because the principle laid down by Mr. Justice Powers has been followed. In my opinion, that is the principal reason why we have 200,000 unemployed persons in Australia to-day. The Arbitration Court, influenced by the weight of the opinion of trade unions and the like, has not had true regard to economic conditions. The basic wage should not be rigidly fixed; it should rise or fall according to the capacity of industry to pay it; it should be a barometer of industry. In good times let us pay the highest wages that the country can afford to give; but when Australia is in a state of economic depression, as at the present time, it is absurd to say that industry can pay the same wages as were given when the country was flourishing.

I know that I am expressing an unpopular view. Everybody seems afraid to give voice to the awful statement that wages must come down. Honorable members opposite, of course, would regard it as political suicide to say such a thing; but economic conditions must be faced. It wc look at the position fairly, we must admit that not only wages, but also profit and interest must be reduced to a normal level to bring us into line with other countries with which we must deal in order to live.

If we refuse to recognize economic facts, the disaster which we fear will come upon us, and then wages will be forced down. There should be no necessity for such a section in an act of Parliament; but, if it were now deleted, there would undoubtedly be an invitation to those administering the act to say that it is no longer necessary to have regard to economic conditions. Honorable members have claimed that the court should be under no restraint in giving its awards. I point out, however, that the court is under a perpetual restraint. The fixing of a basic wage is a most serious restraint on the discretion of the court regarding the wage that it will grant. There is now a special reason why the section should be retained, and I think that I know why honorable members opposite insist on its removal. Before the last election, and ever since, honorable members opposite have promised the country that, irrespective of economic conditions, they will be no party to a reduction in wages. The Government, under this bill, is appointing conciliation commissioners to fix wages, and in the proposal to strike out this section there is an implied direction to those commissioners that there must be no reduction in wages, irrespective of economic facts.

Progress reported.,

page 3888

ESTIMATES, 1930-31

Additions, New Works, Buildings, etc.

Message reported transmitting estimates of expenditure for additions, new works, buildings, &c, for the year ending 30th June, 1931, and recommending appropriation accordingly.

Ordered to be printed and referred to Committee of Supply.

page 3888

BUDGET, 1930-31

In Committee of Supply:

Mr scullin:
Prime Minister and Treasurer · Yarra · ALP

[4.29]. - In formulating the budget for the year 1930-31 the Government was faced with a financial depression without parallel in the 30 years’ life of the Commonwealth. The causes of this depression have been the subject of a great deal of comment and discussion with which honorable members are familiar. In order, however, to focus attention upon the real nature of the problem, it is proper to review again the main factors that are reacting so adversely upon our financial position.

The severe economic disturbance at present prevailing in nearly all countries lias been preceded or accompanied by a disastrous collapse in commodity values. Its effect on the prices of wool, wheat, metals and other products, which constitute the major portion of Australia’s exportable production, are well known. Concurrently with the decline in the value of exports there has been a cessation of the flow of loan moneys from overseas. Drought conditions in many districts during recent seasons also have had their adverse effect by reducing the volume of primary production. The loss in Australia of real income consequent upon these factors is variously estimated for ihe year just closed at between £50,000,000 and £70,000,000.

An inevitable result of the reduced local spending power is reflected in curtailments of credit, reduced trade, increased unemployment, and derangement of government finance.

The ultimate effect upon Commonwealth finance has been accentuated owing to the necessity for restricting importations with the resultant sacrifice of a large proportion of the customs revenue. The fiscal and monetary policy of Commonwealth governments in recent years has been ill-adapted to withstand any serious upset in the trade equilibrium except by an increased dependence on the overseas loan market. The failure of the London loan market as a supplementary source of national income precipitated the monetary stringency from which the whole country is now suffering.

Upon the flow of overseas loan money becoming interrupted we were faced with a shortage of London funds with which to meet our external commitments, and to pay for services and goods purchased abroad. This was the most critical problem facing the present Government when it came into office. We have cont rived to meet the position temporarily by arranging short-dated accommodation from the bill market, advances from the Australian banks, and by overdrafts in London from the Commonwealth and Westminster Banks. But a more permanent solution of the London position must be found.

The Loan Council must secure overseas, by a long-dated loan or other means, not less than £30,000,000 in the near future in order to clear up the London position. Failure to make such provision will bring about an embarrassing situation. The difficulty arises entirely from our temporary inability to secure command of funds in London.

This situation has been causing the Commonwealth Government and the Loan Council grave concern for some time past and has been the. subject of intimate negotiations with London financial houses. I am hopeful that these negotiations will prove successful and that the meeting of our London commitments will be arranged on satisfactory terms at an early date. I have referred to the subject in plain terms and with complete candour in order that honorable members will appreciate the gravity of the problem.

The volume of imports to this country has amounted to colossal figures in recent years, reaching the peak of £164,000,000 in 1926-27. Excluding bullion and specie, these imports exceeded exports by approximately £70,000,000 during the last six years.

When the adverse trade balance could be made good by raising long-dated credits in London the needs of the moment were met. It is clear, however, that British investors were not indifferent to the unsound economic position that had developed in Australian affairs, and equally clear that they had become unwilling to provide loan moneys for lis with the same promptness and facility as before.

The opinion in Great Britain that Australia was overborrowing was greatly assisted by the fact that Australia was issuing new loans in London or New York at frequent intervals. In 1927, Australian Governments floated eleven loans overseas, for a total of £69,706,000 ; in 192S, five loans for £30,500,000; in 1929, up to the change of Government, three loans including treasury bills, for £25,403,000; a grand total, in less than three years, of nineteen loans for £125,609,000. That is to say, Australia, during the three-year period referred to put out loans at an average rate of £6,600,000 in every two months. It matters little when considering the effect of this upon the public mind that, of the total above-mentioned, £36,400,000 was for conversions.

The last new money loan issued for Australia in London was a 5 per cent. 46-year loan issued at 98 in January, 3929. Only 16 per cent, of that loan was subscribed by the public, the balance being left with the underwriters. From the time of that issue to the present the London market has gone steadily against us. Although the necessity of new loans became more and more acute and the Loan Council sounded the position in London many times” during 1929 and again in the early months of this year, no opportunity has occurred to approach the market with an issue upon acceptable terms.

The serious decline that has taken place in the market value of Australian securities in London is indicated in the following statement. For purposes of comparison, the quotations are shown in juxtaposition with the prices of the comparable stocks of New Zealand and South Africa.

In the period from the beginning of 1929 to 30th June, 1930, Australian stocks declined in value 12f points while those of New Zealand declined only 1% and those of South Africa 4 points.

Taking into account the improved figures for this week, Australian stocks, in the full period covered by this table, declined in value 9£ points whilst those of New Zealand declined by 2$ and those of South Africa 4i points.

It has, I think, been brought home to all of us that the time is long overdue when borrowing abroad should be reduced to a minimum, and that the domestic market should be relied upon to provide the bulk of the moneys necessary for developmental works. To revert to the overseas market for borrowing, on the scale which obtained during the last few years, even if the market were, accessible to us, would be merely postponing the day of reckoning, and, now that we are facing that reckoning, it should be done resolutely and with a fixed determination to arrive at a satisfactory and permanent solution of the problem,

The objective to be aimed at is to so adjust Australia’s overseas trade that the surplus of exports over imports together with the reduced borrowing that may be possible on the London and New York markets, in the future, will be sufficient to meet the requirements of the Commonwealth and State Governments for commitments abroad.

To this end, the Government has materially increased the customs tariff on luxuries and non-essential articles, has rationed the imports of some articles and placed an absolute prohibition on the import of certain other articles.

The Australian banks have also given valuable assistance in this direction by rationing London exchange to their importing clients. In addition, the increase in the rate of exchange on London is an important factor which will operate towards restoring the balance of trade. In July last, £101 in Australia would buy a telegraphic transfer of £100 to London; to-day it would cost £106 10s. for the same purpose. The additional cost of Loudon funds, whilst operating adversely to the importer, replaces to some extent the reduced returns to the primary producer from the sale of his exported products.

In December last, the Government brought down a measure which was approved by Parliament, authorizing the mobilization of the gold resources of the Commonwealth. By this means, gold, which had been lying idle in the vaults of the banks, became an active influence in assisting the London exchange position. During the financial year, gold to the value of approximately £27,000,000 was transferred overseas, but obviously this cannot become a recurring operation on so large a scale. When the gold holdings >f the Commonwealth Bank are reduced io such an amount as is necessary for the seasonal expansion of the note issue and the statutory gold reserve, the gold available for export will be limited to new production approximating £2,000,000 per nil num.

It may be necessary in order to make sure of future government requirements in London being met to invite the trading banks to pool their external exchange and give the Commonwealth and State Governments first call upon their London funds.

It is not claimed that a permanent settlement of our financial difficulties can he obtained by the methods outlined. At the best, they are temporary, and, in some cases, drastic expedients imposed to meet an emergent situation. In due course, when they have fulfilled their purpose, these temporary expedients will be removed. It is confidently expected that, in the meantime, Australia’s secondary industries will have so expanded that much of the manufactured goods imported in the past, will be replaced by goods of local manufacture resulting in a substantial permanent reduction in the volume of imports.

On coming -into office in October last, the Government found the following position : -

The accumulated deficit at 30th June, 1929, was £4,987,71S.

An examination of the Consolidated Revenue position as at the date of the change of government disclosed that a further deficit in the current year’s accounts would be inevitable. Towards meeting this, the present Government imposed additional taxation, but due mainly to the reduced volume of imports the year finished with .a deficit of £1,470,164.”

At the end of September, 1929, the Commonwealth Government cash balances showed a credit balance of £420,000 ii* Australia, but a debit balance . of £3,370,000 in London - thus a net debit balance in the Commonwealth cash accounts of nearly £3,000,000.

The total new money required for the 1929-30 loan programmes of the Commonwealth and the States, and to cover arrears of borrowing and deficits to be funded, was £42,000,000. In addition, the Government was faced with the task of providing, within one year of assuming office, for the conversion or redemption in Australia, of £71,000,000 of maturing Commonwealth loans.

Financial RESULTS 1929-30.

The transactions of the financial year 1929-30 resulted as follows:-

As against this deficit, it should be rer membered that during the year £4,164,032 was provided from Commonwealth revenue for the redemption of Commonwealth debt and £994,433 was provided from Commonwealth revenue for the redemption of States’ debts.

Last year the present Government budgeted for revenue of £64,589,000. The actual revenue shows a shortage of £1,542,697, a sum approximately the same as the deficit for the year.

Of the total revenue, £5S,187,777 came from direct and indirect taxation, whilst other revenue totalled £4,858,526. Customs and excise revenue was £2,675,609 less than the estimated This loss of revenue was largely due to the restrictions imposed on imports, which have already been referred to. From direct taxation, we received £968,386 more than was estimated, the chief increase being £535,030 under income tax.

It was anticipated that the business undertakings would show a surplus of. £176,601 for the year. Instead, however, there was a loss of £125,683. This was due to the diminution of postal receipts and of Trans-Australian railway earnings.

The expenditure on the departments and general services was £340,759 less than the estimate. The chief item of decrease was interest and sinking funds on war loans, which was £603,455 less than the anticipated payments. Under the war conversion operation of March last, interest on converted holdings of the December, 1930, loan became payable in September and March of each year instead of in June and December. Whilst there was no loss of interest to the bond owners, one result of the conversion was to relieve last year’s Commonwealth accounts of three months’ interest on the converted holdings.

Last year it was necessary to increase the amount provided by the former Government for invalid and old-age pensions from £10,300,000 to £10,600,000. Even this increased amount proved to be inadequate, the final expenditure being £10,791,326. There was a large increase in the applications for pensions, due to the extent of unemployment.

A saving of £91,432 was secured under the ordinary votes of departments, the expenditure being £2,950,459, as against the estimate of £3,041,891. The expenditure for the year was less than that for 1927-28 and 1928-29.

Under miscellaneous services there was an increase of £232,667, the expenditure being £619,504, as compared with the estimate of £386,837. Of the increase, £171,000 was for interest on overdrafts in London, and £85,000 represented exchange on the remittance of funds to London. It is necessary for the Government to secure all possible London exchange despite the fact that the exchange rate is over £6 per £100.

The Accumulated Deficit

The accumulated deficit of £4,987,718 at 30th June, 1929, has now been increased to £6,457,882. In view of the abnormal financial conditions at present existing, the Government does not propose to provide for the reduction of the accumulated deficit during the current financial year. To raise additional taxation for this purpose in a year when the income of Australia is greatly depleted and ordinary revenue yields much less than it would in a normal year, would be to place too great a burden on the nation. With a return to normal conditions, and a substantial increase of exports, it should be possible to provide for the liquidation of the deficit over a relatively short period of years. In the meantime, the deficit will be temporarily covered by means of a loan appropriation of £7,000,000, which was voted “ to be paid to the Consolidated Revenue Fund.”

Parliament must recognize, however, that no further drift in Commonwealth finances can be permitted, and that the balancing of the budget is an essential step for the restoration of the credit of Australia. The Government proposes to watch the financial position closely throughout the year, and, without waiting until the end of the financial year, will not hesitate to take immediate steps if such action appears to be necessary in order to prevent any serious disturbance in the budgetary position.

Review of Common w ealth Expenditure.

In any examination of the financial difficulties of the Commonwealth, we must not overlook the enormous annual burden attributable to the war. The Commonwealth must raise more than £30,000,000 per year in taxation to pay the direct and inescapable charges for interest and sinking fund on war debt, and for war pensions and repatriation services. In addition there are other indirect war charges which contribute to the cost of government in many ways. The war has laid a heavy burden upon all the combatants. In times of financial stress such as the present the crippling effect of our increasing war obligations is grievously felt.

In part 1 of the Consolidated Revenue Fund - that is, departments and services other than businessundertakings and territories - the total expenditure for 1929-30 was £52,302,742. The following expenditures included in that total are almost wholly payable under statutory appropriations which are not controllable by the Administration.

Of the balance, £7,186,372, more than £4,000,000 is absorbed by the Defence Department and about £3,000,000 by the ordinary departments. Those who talk of’ cutting millions out of this expenditure have not sufficiently considered the problem.

Drastic cuts have been made in the Defence Department. A reduction of £150,000 was made in the appropriations for the year just closed and a further reduction of £500,000 is being made in this year. It will be impossible to make further reductions without resorting to drastic retrenchment of the personnel and seriously impairing the whole defence organization.

By the reorganization of the work of the Development and Migration Commission a substantial saving in administrative and other contributory expenses has been secured. The expenditure from revenue this year will be £50,709 less than the amount appropriated last year, and £60,746 less than the actual expenditure in 1928-29. As the reorganization was effected during the course of the year 1929-30, the expenditure for that year was £16,880 less than the amount appropriated. In addition to the savings on revenue votes, passage money appropriations, which were formerly met from the Loan Fund, have been reduced by £80,000- from £100,000 last year to £20,000 this year.

Administrative expenses in connexion with the Federal Capital Territory have been reduced by £30,000.

The ordinary votes of the Government Departments have been subjected to the closest scrutiny. The total appropriation is lower now than it was in any year during the last four years, notwithstanding the increased cost of living allowances payable to officers of the Public Service.

It must be remembered that there is always a natural increase in administrative expenditure due in part to an extension of existing services, as well as to the demands of a growing population. Notwithstanding this natural increase the Government, by careful control, was enabled to keep the expenditure last year £91,432 below the amount appropriated.

The Government has been in office only eight months and it has been impossible in that short period to exhaust all possibilities nf reducing expenditure. Earnest efforts have been made to cut out unnecessary expenditure. It is the intention of the Government to continue a close scrutiny of departmental expenditure throughout the year and it is confidently hoped that the result will be a substantial reduction in expenditure as compared with the amount estimated.

A careful examination of departmental expenditure shows that “any large saving can be achieved only at the expense of salaries and other emoluments and by retrenchment of staff which, as a result of rigid control, is not at present overloaded.

The extra cost of living allowance which has been awarded to the public servants and is incorporated in the current year’s Estimates, is the result of arbitration awards. It may seem anomalous that at a time when commodity costs are falling the Public Service should enjoy increments in salary owing to “increased cost of. living”. It must be remembered that the computation is based upon the twelve months’ figures for the period prior to March in each’year and that, therefore, there is always a lag between the increase in the cost of living and the automatic increase in salary enjoyed by the Government employees. If the cost of living continues to decline the Public Service will, next year, by the operation of the same awards, be subject to an automatic reduction of salary.

Invalid and Old-age Pensions.

Increased numbers of claims for invalid and old-age pensions have resulted in heavy additions to the annual expenditure under this heading, the figures being -

During 1929-30 the number of pensions in force increased by 13,959, which constituted the largest addition in any one year. This heavy increase may be attributed to the present industrial depression. On the 30th June, 1930, there were 155,196 old-age and 63,304 invalid pensions in force.

War. Pensions and Repatriation

The estimated expenditure on war pensions in 1930-31 is £7,957,000, as compared with £7,897,289 in 1929-30. It will thus be seen that the peak period for war pensions has not yet been reached, though it was generally considered that 1930 would be the peak year. It is estimated that the number of pensioners will increase from 278,318 on 31st May, 1930, to 284,000 on 30th June, 1931, owing chiefly to the increasing number of pensioned wives and children and to pensions granted by the Appeal Tribunals. General repatriation expenses are expected to increase from £1,044,000 in 1929-30 to £1,125,314 in 1930-31. These figures represent the net expenditure, after allowing for repayments of loans and other miscellaneous receipts. - Excluding war pensions, the principal items in the gross expenditure for 1930-31 may be compared with those for 1925-26 as under: -

It will be seen that the cost of administration has decreased by £9,336, but . the benefits to ex-soldiers and their dependants have increased by £249,054.

Despite the lapse of time since the conclusion of the war, repatriation expenditure continues to grow.


In view of the present adverse position of Commonwealth finances, the Government has found it necessary to reduce financial allotments for defence purposes for 1930-31 to £3,767,000 from revenue and £129,800 from loan fund, as compared with £4,267,000 and £246,500 respectively in 1929-30. The revenue savings thus total £500,000 and the loan £116,700.

As a result, curtailment of certain activities in the Royal Australian Navy is necessary, the ships in commission being reduced to H.M.A.S. Australia,. H.M.A-S. Canberra, cruisers ; H.M.A.S. .Albatross. seaplane carrier, and H.M.A.S. Anzac. flotilla leader ; the following ships having been paid off into reserve during 1929-30 - H.M.A.S. Swordsman, H.M.A.S. Success, H.M.A.S. Moresby, H.M.A.S. Oxley and H.M.A.S. Otway, these factors enabling reduction of establishments of seagoing personnel by 61 officers and 639> men, including five officers and 76 men on loan from the Royal Navy who have been returned to England. Of the total establishment of the sea-going forces. Royal Naval personnel now approximate 3 per cent, only - the lowest percentage yet recorded.

Reductions in the personnel of the Permanent Military Forces total 92, representing the abolition of vacant positions. The change from compulsory to voluntary enlistment, combined with the consequent reductions in establishments from 47,500 to 35,000 militia,1 and senior cadets from 16,700 to 7.000 leaves the permanent forces over-staffed to a certain extent. To obviate hardship that would result from dismissals, a scheme of enforced leave- not to exceed eight week* per annum - has been introduced as a temporary expedient, but no member will receive less than the basic wage under this scheme. Royal Australian Air Force establishment has been reduced by three officers and 34 airmen, but as this force has been working below establishment, no dismissals will be involved:

Approximately 100 employees have been discharged from munitions establishments - a substantial proportion of these discharges being due to completion of the development programme. By extension of the policy of acceptance by factories of orders from commercial firms, further dismissals of any magnitude appear improbable.

For purposes of economy it has been decided to transfer the Royal Naval College from Jervis Bay to Flinders Naval Depot where it will function as from the end of July, while, for similar reasons, the question of transferring the Royal Military College from Duntroon to military buildings available elsewhere is at present receiving consideration.

Civil Aviation. - All subsidized services functioning in 1929-30 - with the exception of those carried out by the Larkin Aircraft Supply Company Limited in Victoria, New South “Wales and South Australia, which were discontinued at date of expiration of agreement on 9th June, 1930, owing entirely to passenger traffic, mails and freight not justifying their continuance - will be maintained during 1930-31, while an extension of the service through the Kimberley district of North-west Australia from Derby to Wyndham, 600 miles, will commence in July, 1930- such service to be operated during the “ dry “ season only, eight months per annum.

General. - As the result of sums available for defence purposes in 1930-31 being £616,700 less than those appropriated in 1929-30, all defence activities have been very carefully investigated and reviewed. With the object of maintaining the existing high standard of efficiency of the forces,, the necessary economies have been effected in the least essential services.

Federal Aid Roads

During the last four years, the Commonwealth has paid the States £2,000,000 per annum under a ten-year agreement relating to Federal Aid Roads. Under this agreement the States were required to contribute 15s. for each £1 provided by the Commonwealth, and conditions were laid down as to the classes of roads on which the money should be spent. The Commonwealth also had the right of supervision.

The present Commonwealth Government has no desire to exercise any control over the activities of the States in relation to roads. It is, however, pre-1 pared to continue to contribute £2,000,000’ per annum to the States for roads expenditure.

As the result of conferences on this matter a general agreement has been reached. Under it, the Commonwealth will pay to the States, during a period of 10i years as from 1st July, 1926, £2,000,000 per annum. The States will undertake to spend this money on the. construction, reconstruction, maintenance, or repair of roads. They will not, however, be under any obligation to’ contribute any particular sum for roads expenditure from their own funds, nor will the Commonwealth exercise any supervision over the work of the States in this connexion.

A formal agreement on these lines has been submitted to the States, and will, at’ a later date, be placed before Parliament for ratification.


The number of unemployed workers in the Commonwealth has grown steadily during the last eighteen months. But for the additional protection to local industry afforded by the recent tariff adjustments, the position to-day would undoubtedly have been much worse.

A sound national insurance scheme extended to unemployment, if it had operated a sufficient length of time, would have gone a long way towards mitigating the distress endured by the workers in the present crisis. Such schemes, however, imposing as they do additional charges upon industry, should be initiated only in normal times, when there is a reasonable prospect that through a succession of prosperous years insurance funds will be built up with sufficient strength to withstand the heavy drain iri times of stress. “

The Commonwealth Government, however, recognizing the dire straits of many of the workers and their families throughout the country, has done what is practicable, with the limited resources available, to afford some relief. In addition to the assistance to industry granted through the protective duties, arrangements were made with the Commonwealth Bank to extend credits through State institutions and the trading banks for the stimulation of primary and secondary production. It is hoped that when the central reserve bank is established, and commences operations, the credit resources of the Commonwealth will be better mobilized and made more readily available for the legitimate trade and industrial needs of the community, thus opening up new avenues of employment as well as extending existing avenues.

The Government has undertaken to distribute among the States a grant of £1,000,000, to be used for the purposes of immediate relief of unemployment. This will be in addition to the amount of £1,000,000 provided from Commonwealth revenue for road construction purposes, some months ago. Additional funds were provided for the Postmaster-General’s Department enabling employees, who would otherwise have been dismissed, to be retained to the number of 1,720. In addition, expenditure is being specially incurred in the Federal Capital Territory and in North Australia with the object of providing work for the unemployed.

Postmaster-General’s Department

Telegraph, Telephone and Broadcasting Services

As a result of adverse financial and business conditions, telephone installations fell from 29,000 in 1928-29 to 15,000 last year. The total number of telephones now in use in the Commonwealth is 521,000. Australia occupies sixth place in the world in the number of telephones per head of the population.

Progress has been made in the establishment of automatic exchanges, eleven having been brought into service during the year, and tenders have been invited for apparatus necessary for further extensions of the system in rural areas.

Developments in long-distance telephony during the past year have been striking. Most prominent is the inauguration, on the 30th April last, of the service between Australia and Great Britain. Extensions of this over-ocean service have been and are now being made to many other European countries, and investigations are in progress regarding a service with New Zealand. In Australia, about 8,000 additional miles of trunk telephone lines were added to the system last year, and the method of superimposing several channels of communication upon an existing linehas resulted in the equivalent of a further wire mileage of 10,000 miles. The linking up of capitals will be advanced by the Perth-Adelaide service, which it is anticipated will be opened before the end of 1930, and proposals for the telephonic linking of Tasmania with the mainland will be submitted to Parliament at an early date.

The rates for telephone services were recently increased, as the service was being conducted at a loss. Notwithstanding the increase, telephone facilities cost less in Australia than in other parts of the world; many facilities in country districts are provided below cost.


Re-organization in regard to the Telegraph Branch has resulted in a reduction of £170,000 in working expenditure over the two financial years to 30th June, 1930, but, notwithstanding this, the decline in earnings still prevents the branch from showing a profit. Technical improvements have also been made in many directions during the year, amongst which may be mentioned the abolition of a number of repeating stations in favour of direct communication between the country towns and capital cities, and provision of additional facilities for intercapital communication. At the end of 1930 it is expected Perth will be in direct communication with all other State capitals except Hobart.


National broadcasting services are now in operation in every State except Tasmania, which will participate on the expiration of the existing licence on the 13th December next.

The Government is anxious to improve the service throughout the Commonwealth as widely and rapidly as conditions will allow. Our programme includes installations in selected country districts of subsidiary stations to improve reception. It is expected that five such stations will be completed before the end of 1930-31, and provision is being made in the Estimates for still further stations. The number of licences continues to increase, there being 311,322 at the end of May, 1930, as compared with 298,551 at that date in 1929.

Commonwealth Railways

Working expenses and interest on Commonwealth railways absorbed £1,108,423 last year. The revenue was £418,037, so that there was a loss of £690,386, after providing for interest.

The position is expected to be slightly better this year, the estimated loss being £630,200.

These railways were provided to fulfil obligations arising out of federation.

Loan Operations, 1929-30

Apart from two issues of short-term treasury-bills, the only loan operation conducted overseas during the year just closed was the conversion of £3,781,700, 3½ per cent. Queensland stock which matured in London on 1st July, 1930. This conversion was effected by the issue of Queensland securities guaranteed by the Commonwealth and bearing interest at 5½ per cent. per annum, the issue price being £97, and the currency six years, with a right to the Government to redeem the loan after four years.

As regards Australian borrowing, two public flotations of £10,000,000 were authorized by the Australian Loan Council to provide funds for public works for the Commonwealth and the States. The first loan was raised in November last, the terms being 5¼ per cent. at £98, the loan maturing in 1934. The second loan is now on issue; the interest rate is 6 per cent. at par, and the loan matures on 15th November, 1938. A satisfactory response is being made by the public to this loan.

The most important operation during the year was the conversion and redemption of the £10,362,000 6 per cent. loan, which matured on 15th March last, with which was associated a conversion offer to holders in the 6 per cent. war loan for £60,000,000 odd maturing on 15th December next.

The new terms offered were 6 per cent. at par for a period of seven years.

Of a total of over £70,000,000 maturing in March and December of this year, £48,000,000 was covered by this operation. Allowing for available sinking funds, the balance of the December loan to be provided for later in the year will be approximately £18,000,000.

In February last, when the conversion offer was made, there was some apprehension as to our power to deal with this huge sum, without at least some assistance from the oversea market. The result of the conversion offer has proved the operation to be within the capacity of our own resources, and we confidently look forward to making satisfactory arrangements in regard to the balance of the loan when it matures in December next.

The estimated and actual expenditure compare as follows: -

The net loan expenditure for 1929-30 was £2,872,850 less than the corresponding expenditure for 1928-29, and £1,009,185 less than the amount provided in 1929-30 for debt redemption.

Loan Expenditure, 1930-31

The loan expenditure of the Commonwealth and the States, which had averaged £43,000,000 for some years, was reduced last year to less than £30,000,000.In view of the generalfinancial situation, the Loan Council decided that further drastic reductions were necessary in the loan expenditure for 1930-31. Appropriate reductions are accordingly being made in the loan programmes of the Commonwealth and of each State. The policy of the Loan Council is to confine its borrowing in the future almost wholly to the Australian market instead of relying, as in the past, mainly on the overseas market.

The estimated expenditure represents less than half the average annual Commonwealth loan expenditure for the four years 1925-26 to 1928-29.

Loan expenditure of the Commonwealth has now been reduced to a sum considerably less than the amount applied by the Commonwealth towards the redemption of its public debt. Thus, though we are continuing to provide considerable sums for revenue producing assets such as post office works and war service homes, the gross public debt is being definitely reduced each year.

As against loan expenditure of £4,127,000 estimated for the current year, the amount available for debt redemption will be £6,792,363.

The proposed loan expenditures in 1930-31 compare with the expenditure in 1928-29 and 1929-30 as follow : -

Works under the Migration Agreement are expected to absorb £800,000. This sum is included in the loan programmes of the States.

Debt Redemption

C ommonwealth.

The amount applied towards the redemption of Commonwealth debt in 1929-30 was £6,367,482: The sources from which these funds came were: -

The amount which will be available for 1930-31 is estimated at £6,792,363.


The amounts made available from the National Debt Sinking Fund for the redemption of State debts in 1929-30 were : -

The amount to be provided in 1930-31 is estimated at £3,429,000.

Total Debt Redemption

Combining the Commonwealth and State figures, the total amount made available last year for the redemption of Australian debts was £9,537,259. The actual payments in redemption of debt during 1929-30 totalled £7,021,205 in Australia and £3,466,483 overseas. These sums included balances brought forward from the previous year.

For 1930-31, the amount which will be available for the redemption of Commonwealth and State debts is estimated at £10,221,363.

Soldier Land Settlement

In 1927 the Commonwealth, with the concurrence of the States, appointed Mr. Justice Pike to investigate soldier land settlement, the chief object being to secure a correct account of the losses incurred, and a basis for a financial settlement as between the Commonwealth and the States.

On receipt of Mr. Justice Pike’s report, the late Government asked the States to agree to a settlement on the basis proposed by him, subject to the condition that the interest concession made by the Commonwealth to the States in 1925 be varied so that after 3lst December, 1930, the States and the Commonwealth should shave equally any liability in excess of 5 per centum per annum for interest payable on the Commonwealth loans from which the money- due by the States to the Commonwealth for soldier land settlement was provided.

The position was discussed at a recent conference of Commonwealth and State Ministers, and it was agreed that a settlement be made based solely on the recommendations of Mr. Justice Pike, the Commonwealth undertaking not to vary the interest concession referred to.

Such a variation would have given considerable relief to the Commonwealth, but inasmuch as it was a departure from the recommendation of the investigating authority, the Government felt that to insist on it was inconsistent and unfair to the States. Moreover, this concession which provided that, after 31st December, 1930, interest should be paid by the States at the rate of 5 per cent, per annum on all loans outstanding on that date, had been included in an agreement which had been ratified by four State Parliaments. The terms of settlement are : -

  1. That the basis suggested by Mr. Justice Pike,- viz., that the Commonwealth and States share equally in the losses, he accepted, and that, to give effect to this decision, the Commonweath assume responsibility as at- 30th

June, 1927, for a further amount of £2,447,000. of the Soldier Settlement Loans owing by the States.

  1. That a condition of such acceptance bc the completion of the satisfactory settlement of the soldier settlers now on the land, particularly in respect to the provision of home maintenance areas.
  2. That, in order to cover losses to be incurred in providing home maintenance areas, the further loss on that account be taken as £300,000 and that £150,000 be added to the Commonwealth’s share of the loss, making, say, £2,(500,000; the £150,000 to be allocated to the States affected on the basis of thu number of soldier settlers now on the land. This clause applies to New South Wales, outside irrigation areas, Victoria, Queensland, and Tasmania.
  3. That this settlement be full and final.

The arrangements now made will involve the Commonwealth in the payment of arrears of interest totalling £284,000.

A new agreement is now being drawn up, and legislation will be introduced by the Commonwealth and each State for its ratification.

In 1925, the Commonwealth agreed to assume responsibility for £5,000,000 of soldier settlement loans owing by the States. By the adoption of Mr. Justice Pike’s basis of settlement, the Commonwealth will1 assume liability for a further sum of £2,600,000 of soldier settlement loans owing by the States, making the total of this debt adjustment £7,600,000. Under the original arrangements, the Commonwealth contributed £41,735,000 by allowing the States a rebate of interest on loan moneys raised for them by the Commonwealth:> - In addition, the Commonwealth paid sustenance allowances to soldier settlers of approximately £500;000.

As against this decrease of £4,914,293 in the recorded debt there was a net overdraft of an approximately similar sum in Commonwealth Bank accounts at 30th June, 1930.

The debt at 30th June, 1930, is domiciled as follows : -

The London debt includes the amount due under the war funding arrangement with Great Britain, which originally was £92,480,156, and now stands at £81,294,582.

War debt was reduced during the year by £5,723,345, while works debt increased by £809,052.

Of the gross Commonwealth debt of £372,707,279, due at 30th June, 1930, loan balances in hand and sums repayable to the Treasury amounted to approximately £23,000,000, leaving the net debt at £349,707,279, as against £349,356.349 on 30th June, 1929.


In accordance with the provisions of the Financial Agreement, the Commonwealth, on 1st July, 1929, took over the outstanding debt incurred by or on behalf of the States, and assumed, as between the Commonwealth and the States, the liabilities of the States to bondholders. The debt at 1st July, 1929, amounted to £726,406,490. On 30th June, 1930, debt on account of the States stood at £727,643,712, an increase during the year of £1,237,223.

Total Commonwealth and States Public Belt

At 30th June, 1930, Commonwealth and State public debt combined aggregated approximately £1,100,350,991 as against £1,104,028,062 on 30th June, 1929.

German Reparations

At the recent Hague Conference a final settlement of the problems of German reparation was effected, based on a plan recommended by a committee of experts and known as the “ New Plan “. Under this settlement Australia will receive an average annuity of £864,000 for 37 years.

On the 17th January, 1930, an agreement relating to the liquidation of ex- enemy property was signed at the Hague by Australia and Germany. Under this agreement, Australia has ceased the liquidation of German property in Australia and New Guinea, but retains the proceeds of past liquidations. It is estimated that these liquidations will eventually realize about £4,000,000, which will be applied towards the redemption of Commonwealth debt. The value of the property to be handed hack to former German owners is estimated at about £266,000.

Commonwealth Bank of Australia

Proposals are now before Parliament for the establishment of a central reserve bank for Australia. It is intended that this new bank shall undertake all necessary central banking functions, including those now performed by the Commonwealth Bank. A bill to remodel the Commonwealth Bank on the establishment of the central reserve bank has also been introduced.

The profits of the bank, excluding the note issue, during the last two calendar years, were as follow: -

The profits of the general bank increased by £105,425 and those of the Rural Credits Department by £14,920, whilst the savings bank profits fell by £78,183, this decrease being due to the higher rate of interest now being paid to depositors.

Note Issue Department

The profits of the Note Issue Department for the year ended 30th June, 1930. were £938,225, of which £703,669 was paid to Commonwealth revenue and £234,556 was transferred to the Rural Credits Capital Account of the bank.

The notes in circulation and the gold reserve at the 30th June, 1930, were respectively £44,914,326 and £19,931,102. At the corresponding date in the previous year these totals were £42,408,226 and £22,651,496.

During the year, the value of the notes held by the public fell by about £2,200,000, while the value of the notes in the hands of the banks increased by approximately £4,700,000.

Estimated Expenditure, 1930-31

The charges to be borne by the general revenue in 1930-31 compare with those for 1929-30 as under : -

Under departments and general services, the principal increases are -

It is quite impracticable for the Commonwealth to avoid the increases above set out.

The payments to the States include an additional amount of £1,000,000 to cover the grant to the States for unemployment, to which reference has already been made.

Budget Position, 1930-31

After exhaustively reviewing the expenditure for 1930-31 and making all possible reductions therein, the Government found that, allowing for the expected yields of taxation and other revenue on the present basis, it would be faced with a shortage of revenue in the present year of £14,038,770.

The details of the shortage are as follows : -

It was obvious that such a wide gap could not be bridged without increased taxation, and moreover it is necessary that such increased taxation should operate as early as possible in the new year. To enable the taxation measures to be proceeded with immediately it was decided to bring down the budget, based on group totals of estimated expenditure for 1930-31. The approximate expenditure for 1929-30 in the same groups is also supplied for the purpose of comparison.

It is hoped that it will be possible topresent the main estimates in a fortnight’s time, when the usual full set of budget papers will be circulated. For the present T am distributing, for the information of honorable members, such of the budget papers as are essential to the general budget debate.

In determining the necessary new taxes and charges, the Government has exercised great care with a view to spreading their incidence as fairly and as widely as possible so that an undue burden may not fall on any one section of the community and there may be the least possible disturbance of industry. Regard was paid also to the existing State taxes which preclude the Commonwealth from imposing heavy additional taxes in fields in which the States also operate.

It being essential that the budget should be balanced, the Government has adopted the following proposals to cover the shortage of £14,038,770:-

With this new revenue, the budget for 1930-31 will be balanced:

Estimated Revenue, 1930-31

Customs and Excise

The expected yield of customs and excise duties for 1930-31 under the present tariff is £34,000,000. This represents a loss of £7,774,391 as compared with the yield of these revenues in 1929-30. This loss inevitably followed the restrictions recently placed on imports with a view to correcting the adverse balance of trade. Towards making good this loss of customs and excise revenue, the Government proposes to impose new revenue duties estimated to yield during the present year the sum of £5,700,000. This will bring the estimated revenue from customs and excise to £39,700,000, which is approximately £2,000.000 less than the yield last year. The proposed new customs and excise revenue duties are -

Customs duties -

A primage duty of 2½ per cent.

Increases in existing duties -

Petrol - 3d. per gallon.

Tobacco - 6d. per lb.

Cigarettes -1s. per lb.

Cigars - 2s. per lb.

Films -1d. per foot.

Newsprint -£1 per ton.

Wireless valves - 10 per cent.

Excise duties -

Increases in existing duties: -

Beer - 2d. per gallon.

Petrol- 3d. per gallon.

Cigarettes - 3d. per lb.

Sales Tax

It is proposed to collect additional revenue amounting to £5,000,000 during the current financial year by means of a sales tax of 2½ per cent. on the sale prices of commodities sold in Australia other than those which are to be exempted. A full year’s revenue from this source is estimated at £6,250.000, on a total taxable field of £250,000,000.

The tax will not apply to any sales made by primary producers, or to any sales of goods for export from Australia, or in respect of goods exported before sale abroad.

Sales of the following goods will be exempt from the tax inall circumstances : -

Milk, butter, cheese, condensed milk, meat, wheat, flour, sugar, bread and pastry, potatoes, market garden produce, orchard produce, eggs, poultry, other dairy produce, fish, grapes, hay and straw, sundry other crops, coal, articles covered by the new special revenue duties, and manufactures of government workshops.

The field of taxable sales includes all imported goods sold for consumption in Australia and all goods produced or manufactured in Australia other than those specified as exempt.

The tax on imported goods will be payable at the time the goods are being cleaned from customs control, unlessthe importer is a wholesaler or a manufacturer who is licensed under the law relating to the sales tax. Licences will be issued to approved wholesalers and manufacturers in order that they may pay the tax upon imported goods at the time they sell them to aretailer or to the public direct. This will enable manufacturers to obtain necessary materials and articles for purposes of their factorieswithout paying sales tax at the time of importation. When these material’s and articles have been wrought into or attached to other articles made by the manufacturer, thus forming part of that article, their selling value will form part of the total sale price upon which the manufacturer will be required to pay the sales tax.

Licensed wholesalers and licensed manufacturers who sell to other licensed wholesalers or licensed manufacturers will not pay the tax on such sales, as the tax will be subsequently paid by the purchasing licensed wholesaler or manufacturer when he sells to the retailer or to. the public-

The basis of the scheme of: this tax is similar to that of the sales tax at present in force in the Dominion of Canada.

It is intended that vendors who make taxable sales shall render monthly accounts to the Commissioner of Taxation and shall send with those accounts a remittance of the tax payable in respect of those sales.

Provision will be made to allow adjustments in regard to bad debts in respect of which sales tax has been paid.

It is not intended to allow a refund of sales tax in respect of imported goods which are subsequently exported unless and until a drawback of customs duty, if any, payable on the goods, has been certified to. by the paper authority. If goods which are free of customs duty are exported from Australia outside customs control a refund of sales tax will’ not be granted.

Postage Charges

The alterations in postage contemplate reversion to the 1923 rates so far as letters and postcards are concerned, excepting that the unit of weight for letters will be1oz. The postage on letters and lettercards will therefore be 2d. per oz. and on postcards.1½d. each. Minor adjustments are being made in regard to certain other classes of mail matter.

The estimated additional revenue is £1.000,000.

Income Tax

It is proposed to raise a total amount of £10,100,000 from income tax during the present financial year. Of this amount £850,000 will be secured by increases in the existing rates of tax, and £150,000 from amendments in the In come Tax Assessment Act as contained in the bill now before the Parliament.

The proposed increases in rates and the estimated additional revenue from the increases are: -

The accumulated income arising from the liquidation of ex-enemy properties was invested from time to time in Commonwealth securities. During 1929-30 steps were taken to liquidate these securities, and it is expected that by the end of 1930-31 a sum of £1,500,000 will be available from these sources for payment to the Commonwealth revenue. This sum will assist in balancing the budget for the present year.

Taxation PerHead.

Although the additional taxation and charges involve a sum of £12,550,000; it is proper to regard a great proportion of this as imposts to. replace, and not to supplement, the taxation of previous years. The following table setting out the Commonwealth taxation per head for the last six years in comparison with the estimated tax for the new financial year will illustrate this fact: -

It will be seen that notwithstanding the increased taxation imposed for the current year, the per capita taxation will be less than that of 1927.


I have now placed before the committee a full and frank statement of our finances - withholding nothing and exaggerating nothing.

Our loan expenditures have been cut practically in half and can now be provided almost wholly by our own people.

Our sinking funds are sound. Through them, Australia is providing over £10,000,000 per annum for debt redemption.

Effective steps have been taken to reduce imports and encourage local manufactures and action has been taken to stimulate exports. With the co-operation of the Australian banks in the matter of exchange, the balance of trade should turn in our favour, thus providing means for meeting our future oversea commitments.

Difficult though our position is, there are definite signs of improvement. Australia has recently demonstrated its capacity to manage its huge local war conversions without oversea assistance, and the present £10,000,000 loan promises to be a complete success.

The Government is determined to balance the budget and to take all measures necessary to ensure the honouring of our obligations, both at home and abroad.

I move -

That the first item in the Estimates for Additions, New Works, Buildings, &c., under Division I. - The Department of Defence - namely - “ Naval Establishments - machinery and plant,£1,500 “, be agreed to.

Progress reported.

page 3904


The following paper was presented : -

The Budget, 1930-31 - Papers (Preliminary Issue) presented by theRight Honorable J. H. Scullin, P.C., M.P., for the information of Honorable Members on the Occasion of opening the Budget of 1930-31.

Ordered to be printed.

page 3904


Customs, Excise and Primage Duties

In Committee of Ways and Means:

Minister for Trade and Customs · Maribyrnong · ALP

– I move -

That the Schedule to the *Customs Tariff* 1921-1930 as proposed to be amended by the Customs Tariff Proposals introduced into the House of Representatives on the nineteenth day of June, One thousand nine hundred and thirty, be further amended as hereunder set out, and that on and after the Tenth day of July, One thousand nine hundred and thirty, at nine o'clock in the forenoon, reckoned according to standard time in the Territory for the Seat of Government, Duties of Customs be collected in pursuance of the Customs Tariff as so amended. That, excepting by mutual agreement or until after six months' notice has been given to the Government of the Dominion of New Zealand, nothing in this Resolution shall affect any goods the produce or manufacture of the Dominion of New Zealand entering the Commonwealth of Australia from (he Dominion of New Zealand.
That the Schedule to the *Excise Tariff* 1021-1928 as proposed to be amended by the Excise Tariff Proposals introduced into the House of Representatives on the nineteenth day of June, One thousand nine hundred and thirty, be further amended as hereunder set out, and that on and after the Tenth day of July, One thousand nine hundred and thirty, at nine o'clock in the forenoon, reckoned according to standard time in the Territory for the Seat of Government, Duties of Excise be collected in pursuance of the Excise Tariff as so amended. ,i and - That, in addition to the duties of Customs collected in accordance with the Schedule to the *Customs Tariff* 1921-1930, as proposed to be amended by Tariff Proposals, there be imposed, on and after the Tenth day of July, One thousand nine hundred and thirty, at nine o'clock in the forenoon, reckoned according to standard time in the Territory for the Seat of Government, an ad valorem duty of Customs (in this Resolution referred to as primage duty), at the rate of two and one-half per centum on all goods (whether liable to duty or not liable to duty under that Schedule, or under that Schedule as proposed to be amended by Tariff Proposals) which are entered for home consumption on or after the said Tenth day of July, One thousand nine hundred and thirty, except - {: type="a" start="a"} 0. goods covered by Items 368, 370, 371, 372, 373, 400, 401, 409 and 423 of the *Customs Tariff* 1921-1930 as proposed to be amended by Tariff Proposals, 1. bullion and specie, and radium, and 2. any other goods which are from time to time excepted from primage duty by Proclamation made by the Governor-General with the advice of the Federal Executive Council and published in the *Gazette.* That in this Resolution " Tariff Proposals " means the Tariff Proposals introduced into the House of Representatives on the following dates, namely : - 19th June, 1930; and 9th July, 1930, and includes any Tariff Proposals to amend the *Customs Tariff* 1921-1930 which are introduced into the House of Representatives subsequent to the Ninth day of July, One thousand nine hundred and thirty These motions are self-explanatory.. With respect to the first two, a memorandum has been circulated among honorable members, and they will have an opportunity of noting the increases made in the schedule. The third motion means that, subject to the exemption enumerated in the list supplied to honorable members, a 2½ per cent. primage duty will be placed on all goodsentered for home consumption. Progress reported. {: .page-start } page 3907 {:#debate-21} ### CONCILIATION AND ARBITRATION BILL *In committee* (Consideration resumed from page 3888) : Clause 17. {: #debate-21-s0 .speaker-KXQ} ##### Mr ARCHDALE PARKHILL:
Warringah -- It is somewhat difficult to return to the subject of industrial arbitration after the devastating experience honorable members have just had.. I have endeavoured to collect my thoughts, and I am assisted in that direction by the fact that the question under the consideration of the committee when the debate on this bill was interrupted was whether the judges should be called upon to have regard to economic conditions in making awards. The honorable member for Fremantle **(Mr. Curtin)** gave a dissertation upon the disadvantages of consulting economic experts. He spent a great deal of time in pointing out the extent to which their opinions varied, and he concluded by intimating that their views were of no value inrelation to the subject of wages. If it is of no importance that a judge should take into account the probable economic effect of his. award in determining the conditions that should be observed in an industry, he might as well distribute largesse to any extent to which he felt disposed to go. To show how the honorable member blows hot and cold on this subject, I intend to quote from the report of the Royal Commission on Child Endowment or Family Allowances, which the honorable member signed. Did he then say that research on an economic basis was of no value? Not by any means. That report stated - >We wish strongly to recommend that the Federal Government establish some organization for the study of social and economic conditions in Australia, so that accurate and intelligently compiled information may be obtainable by governments to guide them in introducing measures for social reform. A large quantity of interesting data in the Statistician's office is not worked up, and other data could be obtained. As members of the commission, we felt strongly the lack of expert investigation into many of the questions which came up in the course of the inquiry, and in the absence of such impartial expert research a good deal of the evidence tended to be mere opinion. Every social reform is an experiment, and intelligent observation should accompany all experiments. This applies not only to "social" reforms, but to developments of economic policy also. The industrial and social legislation of Australia offers a rich field for research. The returns made under the Family Endowment Act of New South Wales, to take a recent and closely relevant example, must be bringing into existence a body of information making possible a survey of the problems facing families on low incomes in our community. Amongst other things, such a survey would help to throw light on the incidence of unemployment and its effects on family life. The time has arrived which a " bureau of social and economic research " should be set up in Australia, and we would recommend that this be done. Even one trained economist with an adequate clerical staff attached to the Statistician's office or to the Council for Scientific and Industrial Research could render valuable service, though the establishment of an independentbureau would be better. Such a bureaux would co-ordinate and evaluate not only information obtained through the census and other official returns, but also the data obtainable through social workers, whether government officials or otherwise. Wider economic questions, too, such as the relation of economic policy to national prosperity, to amount and distribution of income, to cost of living, to unemployment and so on, would bc material for research by such a bureau. The advice of a body such as this would be invaluable in helping the Government to decide in what way to amend or enlarge any preliminary scheme of family allowances after it had been in operation some time. The report outlined a scheme for a complete research bureau, to be conducted by economists, who were to inquire into the very subjects that the judges have to consider in administering this act, and it stated that the information that such a body could give would be of great value to the Government. If such advice would assist a. government, surely it is reasonable to assume that it would be equally valuable to the judges of the court. The honorable member's speech to-day was not consistent with the recommendations in the minority report of the royal commission. His remarks did not ring true. The, honorable member seemed to be giving a forced support to principles in which, according to the report which he signed, he did not believe. {: .speaker-009FQ} ##### Mr Curtin: -- The honorable member will perceive that there is a difference between social legislation by Parliament and the fixing of a wage in a specific industry by an arbitration court. {: .speaker-KXQ} ##### Mr ARCHDALE PARKHILL: -- I do; but I return to what I have already said. The very subjects which the honorable member said could not be usefully inquired into by economists are those which were mentioned in the report which he signed as matters on which the views of economists should be obtained. The great difference between the honorable member and myself on this point is that I say that if the information would be useful to the Government it would also be valuable to the judges, who have to deal with the realities of life and matters of the profoundest importance to the workers. I shall now refer to another aspect of the honorable member's speech. He declared that he was in entire agreement with the principle enunciated by **Mr.** Justice Powers, who said, among otherthings - >Parliament must, in my opinion, be left toprotect industries from overseas competition to the extent and in the way it thinks advisable, to enable them to pay wages according to the Australian standard. > >Parliament has already appointed theTariff Board to ascertain how far further protection is necessary to enable industriesto be carried on profitably under Australian rates and standard hours, and to recommend to Parliament what it considers necessary for that purpose. > >The court's duty, in my opinion, is to fix fair wages and fair conditions for the work to be done by members of unions in Australian industries. > >The court will not, therefore, in this case, fix any hours solely on the ground that the employers claim that the industries are not sufficiently protected to enable them to carry on profitably. > >Neither will the court in this case fix any lower basic wage or margin than it would if all the industries were .paying good dividends, and on the ground that the respondents claim that the manufacturing portion of the industry cannot compete with the overseas competition without further protection. That must be proved to Parliament - not to this court. To summarize that statement, it means that the fact that a company is not paying interest on the capital it has invested is to be ignored, and the judge would fix both the basic wage and the marginal rates on the assumption that every industry under investigation by the court was paying good dividends. I ask the committee what the effect of a judgment delivered on that basis would be at the present time. What industries and what companies to-day are paying good dividends? If the workers are putting their best services into an industry they should be adequately rewarded, and if there is such production as permits the payment of high dividends, high wages should be given; but when industry is returning small dividends, or no dividends at all, the effect of fixing wages on such a basis might be to give a limited number of men employment at uneconomic wages, but it would increase unemployment. {: .speaker-JT7} ##### Mr McNeill: -- Does the honorable member think that any court would award such high wages? {: .speaker-KXQ} ##### Mr ARCHDALE PARKHILL: -- I am merely stating what would occur if the formula laid down by **Mr. Justice** Powers were the basis upon which awards were made. The honorable member for Fremantle **(Mr. Curtin)** agreed that the Arbitration Court should proceed upon that basis, despite the distress and adversity that we are at present experiencing. {: .speaker-JT7} ##### Mr McNeill: -- **Mr. Justice** Powers never awarded more than the basic wage. {: .speaker-KXQ} ##### Mr ARCHDALE PARKHILL: -- I am not discussing that at the moment. The course that the honorable member for Fremantle proposed would be fatal to the best interests of this country; therefore, I strongly oppose it. It is opposed also by those honorable members on his own side who preceded him in this debate. The honorable member for Parkes **(Mr. McTiernan)** expressed entire opposition to the retention of the provision that the judge should take cognizance of the probable economic effect of his award. He argued that it was an altogether unworthy section, and that it should have no place in the act. On more than one occasion he alleged that it read like a slice of political policy; and he went on to say that it was wrong that any direction should be given to a judge. Did the honorable member's colleagues and friends hold that view when they offered advice to Judge Lukin in regard to the timber-workers' award, and abused him on account of the award that he gave; or when Judge Beeby gave his award in the engineers' case, at which they stormed and raged? What nonsense it is for honorable members opposite to protest against the offering of advice while they ignore the fact that they themselves have given advice on numerous occasions! What is the use of the honorable member for Parkes advancing such an argument, which, to place upon it the most generous construction, is clearly insincere? It is difficult indeed to reconcile his speech with that delivered by the AttorneyGeneral **(Mr. .Brennan).** The AttorneyGeneral said that there is no need to have this provision in the act, because the courts have always taken into account the probable economic effects of awards. He thus joined issue with the honorable member for Fremantle, and repudiated the sentiment expressed by the honorable member for Parkes. One of the many famous utterances of the late Lord Melbourne, who was a very skilful Prime Minister in Great Britain, was made when he advised his supporters, "It does not matter what we say, so long as we all say the same thing". Apparently the Attorney-General did not give that advice to his supporters, because they have expressed different sentiments. He himself has said that there is no need for this provision, because he reads into section 25 the meaning that the court must take these factors into consideration. Apparently the honorable member for Fremantle and the honorable member for Parkes were not willing to follow thai lead. It now rests with the AttorneyGeneral to say what the section really means. Does he still say that the judges must take into consideration the probable economic effects of awards; or does he agree with the honorable member for Fremantle that they must adopt the view expressed by **Mr. Justice** Powers, or with the honorable member for Parkes, who says that the act, as amended by this measure, will not provide that the judges must take into consideration the probable economic effects of awards? The honorable gentleman to-day gave an heroic exposition of the act. Doubtless he knew that he had an admiring audience of industrial leaders, and he wished to give them something for their money. His speech to-day was in' marked contrast with the faltering and stumbling manner in which he " trod the nigged path last night. He spoke of the charter under which the judges would work, and referred to the fact that in framing their awards they would deal with the substantial merits of the case, regardless of technicalities and legal forms, and that they would not be bound by any rule of evidence, but would inform their minds in such manner as they thought just. Upon analysis, it will be found that those words mean nothing. Honorable members opposite are well aware of that. May I direct the honorable gentleman's attention to another clause, that proves conclusively he was right when In? said that there is provision for taking into consideration the probable economiceffects of awards. Clause 4 provides. *inter alia -* " Industrial matters " includes all matters relating to work, pay, wages . . . and includes all questions of what is fair and right in relation to any industrial matter having regard to the interests of the persons immediately concerned, and of society as a whole. That is all that we are contending for. Why should the provision remain in that clause, and a similar provision be excised later on the ground that it is offensive to the AttorneyGeneral? In Labour politics there are certain words that must never be used; and apparently " society " is one of them. The honorable gentleman has said that the phrase "probable economic effects of an award" is obnoxious, and on that ground it has been struck out.Yet his soul does not revolt at the provision that the judge must pay regard to the interests of, not only the litigants who appear before him, but also of society as a whole, What is society? It is a generic term, and includes not only the workers, but also the wealthier class. There is no doubt that, if the judge must take into consideration the interests of society as a whole, he must pay regard to the economic effects of his award. But as those words are obnoxious to the Attorney-General **(Mr. Brennan),** all that the judge will have to do is to pay regard to the interests of society as a whole. That, of course, is a more genteel way of stating the position. *Sitting suspended from 6.14 to 8 p.m.* {: .speaker-KXQ} ##### Mr ARCHDALE PARKHILL: -- The Attorney-General does not like the specific instruction to the court to require it to take into consideration the probable economic effect of awards, but he believes that the interests of society as a whole should be considered. I move - >That the word " repealed " be omitted with a view to insert in lieu thereof the following : - " amended by omitting the word economic' (first occurring) and the words after ' agreement or award ' and inserting in their stead the words ' in relation to employment or unemployment in the industry or industries directly concerned and in other industries ' ". If the Attorney-General believes in the court paying regard to the interests of society as a whole, he cannot object to it having regard to the effect of its awards upon employment. {: #debate-21-s1 .speaker-KZR} ##### Mr WHITE:
Balaclava .- I support the amendment. The committee heard thisafternoon the two legal luminaries of the Labour party explaining the objections to section 25d. The AttorneyGeneral indulged in specious reasoning, but told the committee nothing. The other legal luminary tripped over the meaning of economics; he could not agree with himself as to what is meant by " economic effect ". If by the deletion of section 25d, judges and conciliation commissioners are told by inference that they are not to have regard to the economic effect of their awards, what will be the effect on industry? No equitable award can disregard " economic effects", which, reducedto simple language, means, in relation to industrial arbitration, the capacity of an industry to bear the conditions proposed to be imposed upon it. At the present time the manufacturers and shopkeepers and business men generally are in a desperate condition, and unemployment is greater than at any other period in the history of the Commonwealth. I wonder whether the Government understands what it is doing when it tells the judges and conciliation commissioners, in effect, that they need pay no regard to economics. {: .speaker-JSC} ##### Mr Brennan: -- Of course that is not stated in the bill. The honorable member is making a reckless mis-statement. {: .speaker-KZR} ##### Mr WHITE: -- I am stating the effect of the amendment. Judge Beeby, who is at least as great an authority on industrial matters as is the AttorneyGeneral, has said- >The court acts within the established economic system, and is bound by the act under which it works to give proper consideration to the present economic situation. In his recent award for the metal trades, he said - >I am forced to repeat and act on my opinion that in the metal trades group of industries recovery to the level of 1924-25 and further expansion are only possible by reduction of costs of production, to which all factors must contribute. He recognized that he must consider the economic state of the industry. But the Attorney-General says that because section 25 instructs the court to act " according to equity, good conscience and the substantial merits of the case, without regard to technicalities or legal forms " and not to" be bound by. any rules of evidence " section 25d is redundant. If that is his sole objection to it why does he not consent to its retention and thus avoid all this argument and spare employers and employees a lot of embarrassment? The business community is already overburdened by the pressure of industrial laws, and the withdrawal of this instruction to the court will make the pressure heavier. To-day the Treasurer submitted a staggering statement which proposes a 2½ per cent. tax on sales and a 2½ per cent. primage tax. {: .speaker-K0A} ##### Mr Gabb: -- Which the consumer will pay. {: .speaker-KZR} ##### Mr WHITE: -- He will probably pay some of it; but all these extra charges cannot be passed on; That there is strenuous competition in business which prevents a raising of prices is obvious from the closing down of many firms. In spite of the Government's prohibitions and embargoes, unemployment is increasing. {: .speaker-K0A} ##### Mr Gabb: -- Are not the banks squeezing some of those firms? {: .speaker-KZR} ##### Mr WHITE: -- I expect that the banks will be obliged further to squeeze them when these additional imposts are placed on the business community. So long as the Government persists in its crazy obsession as to the desirability of piling burdens on industry, unemployment will increase. It is frequently said that Australia with seven parliaments is overgoverned; and we know the enormous cost to the people of the legislative machine. But industry is even more over-governed. This afternoon the galleries were occupied by prominent men from the Melbourne Trades Hall - the industrial middlemen - I do not know for what theyare lobbying; possibly they are aspirants for appointment as conciliation commissioners. These men are neitherworkers nor employers. Like the lilies "they toil not, neither do they spin." {: .speaker-K0A} ##### Mr Gabb: -- Rot. The honorable member has never held one of their jobs, or he would not talk like that. {: .speaker-KZR} ##### Mr WHITE: -- The honorable member has been one of those lilies. {: .speaker-K0A} ##### Mr Gabb: -- And worked 100 hours a week. {: .speaker-KZR} ##### Mr WHITE: -- Possibly, but the salaries and expenses of these organizers, or disorganizes, and the costs of representatives of both employers and em ployees before the Arbitration Court are charged to industry. The AttorneyGeneral might provide an interesting return showing the number of trade union secretaries and other executive officers associated with the Labour movement. While the Government is piling burdens on industry, disregarding the unemployed and treating trade unionists as sacrosanct, it cannot claim to represent the majority of the workers. There is less difference between the employed unionist and the capitalist than between the employed unionist and the unemployed. Yet, the whole of the Government legislation is directed against the employer, who is the only person who can provide work for the workless. **Mr. Justice** Beeby said in the metal trades' case - >There is no excessive profit making at the expense of wage-earners . .. The real concern of the industrialist for some timeto come will be to maintain existing wage rates. Yet ministerial members profess to believe that industry has hidden wealth and excessive profits in which the workers should increasingly participate. If they are intent on furthering the objectiveof their party " socialization of the means of production, distribution and exchange" they are justified in abolishing the safeguard constituted by section 25d. But some of them are men of moderate views ; in connexion with the bounty on sewing machines they have admitted their belief that the capitalist is entitled to a return of 10 per cent. on his investment. I doubt if 25 per cent. of Australian employers can show a net profit of 10 per cent. {: .speaker-KFE} ##### Mr Gregory: -- What about the glass industry? {: .speaker-KZR} ##### Mr WHITE: -- There are, I admit, some big corporations which, owing to their sheltered position, are making greater profits. Generally speaking, however, the profits are considerably below 10 per cent. That is why so much money is available at the present time for Commonwealth loans. This afternoon the Treasurer congratulated himself upon the fact that the loan at present on the market was being so strongly supported. The reason is that business men in Australia are getting so hopeless for the industrial situation that they are withdrawing their money from industry and putting it into loans. I know of many business men who would be very glad to realize on their investments, and put their money into loans if they could do so. I know of at least one big overseas firm which has ceased to carry on its normal operations, and has placed its money in. Commonwealth securities. All this is tending to create more and more unemployment. If honorable members opposite are sincerely interested in the future of Australian industry, they will be well advised not to pin their hopes entirely on the tariff but to do something to assist rather than hinder employers, 90 per cent.. of whom have been employees in the past, and have reached their present positions by industry and hard work. The appointment of conciliation commissioners for limited terms, but with power to issue binding awards will not help in this direction. The **CHAIRMAN (Mr.** McGrath).Order ! The committee is not now considering the appointment of commissioners. Clause 17 is before the Chair. Mr.WHITE. - We are considering a clause which has a bearing upon the economic effect of industrial awards, and I submit that the appointment of conciliation commissioners on the terms proposed will have a damaging economic effect upon Australian industry. Such action is likely to have the effect of embarrassing employers and making things more difficult for them, so that they will not enlarge their businesses, but will, on the contrary, reduce the number of their employees. Many of them will even retire from business altogether, and invest their capital elsewhere. Honorable members opposite frequently say that we on this side favour low wages. Far from that being the case, we are just as interested as they are in keeping wages as high as is economically possible, and in giving the workers a high standard of comfort. Even if an employer were so heartless as to look upon the workers as mere cogs in the wheels of industry, he would realize that, for the sake of efficiency, it would pay him to keep his employees satisfied. The lowest point to which wages could fall would be that at which the workers could not get food and clothing, and there would be a general exodus from this to some more favoured country. The highest point wages can reach is that at which they now stand in many industries in Australia, due to the fact that highly organized industrial groups have been able to obtain from the courts awards quite out of proportion to what industry can stand. It cannot be denied that, on many occasions, employees have received wages based, not on what they produce, but on what they consume. Until the Government faces the industrial situation it cannot deal successfully with the financial situation. The industrial situation is at all times paramount, and reform is particularly necessary at a time such as this. If section 25d of the act is repealed, it will have the effect of putting industrial organizations above the people. It will, in effect, say that such organizations shall receive every consideration, and the consumers, who are the people, shall receive no consideration. That would be neither just nor economic. Moreover, it would encourage industrial disputes. When unions know that the Arbitration Court or conciliation commissioners are not required to consider the economic effect of their awards, the industrial middlemen, or trade union officials, will be encouraged constantly to bring forward logs embodying fresh and greater demands. Take, for instance, the log served recently by the Clerks Union. It is now before the Arbitration Court, and may eventually be dealt with by a conciliation commissioner. At a time such as this when, if we are to attain prosperity, every man must work a little harder, this union is claiming a 36-hour working week and, among other things, is asking for cushioned stools, and for the provision of morning and afternoon tea. Australia is becoming an industrial laughing stock. If this section is deleted, the existing industrial confusion will become more confounded. Business interests will be still more embarrassed, and many persons will be forced out of industry altogether, with a consequent increase in the volume of unemployment. {: #debate-21-s2 .speaker-KXT} ##### Mr PATERSON:
Gippsland .- Widely varying explanations have been given by the Attorney-General and some of his supporters as to what is likely to be the effect of deleting section 25d from the act. The Attorney-General said that the judges of the Arbitration Court invariably give due consideration to the economic effect of awards they make, regardless of this section being in the bill. The honorable member for Parkes **(Mr. McTiernan)** gave a somewhat different explanation, while the honorable member for Fremantle **(Mr. Curtin),** whose eloquence can at times clothe in the finest language some of the most fallacious arguments, expressed the hope that the deletion of this section from the bill would, on some occasions, at any rate, induce the judges to ignore economic effects. Mr.McTiernan. - Will the honorable member give a definition of probable economic effect. {: .speaker-KXT} ##### Mr PATERSON: -- Later I shall endeavour to define at least one probable economic effect. With one thing the honorable member forFremantle said I can agree, namely, that the margin for skill provided in most industrial awards is not sufficient to encourage men to become skilled tradesmen. It seems to me an extraordinary thing that, at a time like the present, when we are facing very great economic depression, and when there is an unparalleled amount of unemployment, the Government should bring forward an amendment of this kind. To my mind, the repeal of section 25d will practically amount to telling the judge or a conciliation commissioner that he need not take into consideration in the future, whatever he has done in the past, the economic effect of any award that he may make. Australia is suffering acutely to-day from too little notice having been given in the past to economics, and the economic effect of awards, and of governmental policy generally. Through paying too little heed to economics we have reached a condition - transitory, I hope - of arrested development, particularly in regard to our exporting industries, many of which are carrying on only with artificial assistance of some kind. We shall never lower costs of production or encourage the expansion of industry and increase our exports by a policy of ignoring economic facts. Yet in this clause the Government is actually inviting the Arbitration Court to put its blind eye to the telescope, and entirely overlook the economic effect of any award it may make. {: .speaker-K0A} ##### Mr Gabb: -- The honorable member means the probable economic effect. {: .speaker-KXT} ##### Mr PATERSON: -- The honorable member for Angas **(Mr. Gabb)** reminds me that the words of the section are " the probable economic effect." The honorable member for Parkes wanted to know why the word "probable" was put into the section, and, with an inquisitiveness which does him credit, has been persistently asking various speakers on this side for a definition of " probable economic effect." I think that the honorable member for Eremantle supplied the best reason for the inclusion of the word " probable " when he asked who can foresee the future. No man, not even a judge of the Arbitration Court, can do so. Therefore, it would be impossible to expect a judge to foretell absolutely and accurately the economic effect of any award he might bring down, but a judge might reasonably be expected to form a very good opinion as to the probable economic effect of such an award. No human being can be expected to foresee more than the probable effect of an action. The honorable member for Parkes asked for a definition of " economic effect." I can inform him that one economic effect of ignoring all economic effects would probably be the injury of industry to such an extent that the volume of unemployment would be greatly increased. In 1920 the Industrial Commission of New South Wales suddenly raised the basic wage from £3 17s. to £4 5s. This action was taken hastily , and without due consideration of its probable economic effect. Immediately the unemployment figures for New South Wales showed a sharp rise from 7 per cent. to 14 per cent. as a direct result of increasing the basic wage. That was the economic effect of an award which suddenly increased wages without consideration of the effect of such an increase on industry. We have been told by either the honorable member for Parkes or the Attorney-General that this Parliament should not presume to direct the judges of the Arbitration Court; that to do so would be to exercise an improper influence over them. Yet the Attorney-General read clause 25 of the bill, which indicates that in certain directions this Parliament does propose to give direction to the court. If it may do so in one respect it would be extraordinary if it were debarred from doing so in another. The retention of this provision in the act will simply be an intimation to the judges that the probable economic effects of their awards should be considered. Honorable members opposite have argued that, even if the section is repealed, the judges will continue to consider the economic effect of any award that they might contemplate making. The Attorney-General has himself said that, prior to the inclusion of this provision in the act, the judges almost invariably considered the economic effects of their awards, that they had done so during the years before this provision had been in force, and will continue to do so even if it is deleted. But the very fact of Parliament repealing the section would, in my opinion, be regarded by the judges and by the conciliation commissioners as a direction that in future they need not consider the economic effects of their awards. A good many arguments that have been used by honorable members opposite in favour of the deletion of this provision would have been logical had they been, advanced against the insertion of it in the first place; but they are not logical arguments for the deletion of the section. If the section is repealed the arbitration authorities will naturally look for the reason for its removal. Although it has- been said that the judges have always considered the economic effects of their awards, that is npt so. I remember that some years ago the fruit-pickers engaged in orchards in our canning-fruit districts applied to the court for an increase of wages. At that time the industry was in a parlous condition and was begging the Government to come to its assistance. But, in spite of that, the judge granted an increase of wages to employees. If the judges do not consider the economic effects of their awards- a great deal of suffering may be inflicted upon the workers. It is in the best interests of the workers, therefore, that the section should be retained in the act. If it is repealed, and the judges neglect to consider economic effects in the making of their awards, increased unemployment is more than likely to occur. {: #debate-21-s3 .speaker-KMZ} ##### Mr MARTENS:
Herbert .- In spite of what the honorable member for Gippsland **(Mr. Paterson)** has said about what happened in New South "Wales some ten years ago, I submit that we should repeal this section of the act. I well remember that the late **Mr. Gillies,** who made an award for the rural workers in Queensland, took the probable economic effect of it into account so much that he reduced the wages of the workers; but fortunately many of the farmers realized that the wages paid before the award was made were only fair, and they continued to pay them. Some other employers, however, sacked their employees, and then began to make inquiries as to whether the award applied to them or not. They discovered that it did hot apply to banana clippers and certain other primary producers, and only to ploughmen employed- by' mixed farmers when the greater part of their time was taken up in work that definitely came within the provisions of the award. These employers sacked their men before they discovered' whether the award applied to them or hot, and I have no doubt that the ' same kind of thing happened in New South Wales in the case referred to by the honorable member for Gippsland **(Mr. Paterson).** The honorable member also referred to an award made in relation to the canning fruit industry during. a period of serious depression. I remind him that, in spite of periodic depressions, the late **Mr. Justice** Higgins never awarded a wage below that granted by the Harvester judgment in 1907. It might reasonably be inferred from the remarks of the honorable member that if an industry were in a sufficiently serious condition a judge would be justified in cutting the workers' wages in halves in order to keep it going. When the conditions of the fruit-pickers in the Stanthorpe district were being investigated by the Queensland Board of Trade and Arbitration - I had the honour of assisting in. the investigation - it was discovered that some of the fruit-growers were not able to pay any wages at all. Generally speaking, judges do consider the economic effect of their awards, and the most that can be said of the cases referred to by the honorable member for Gippsland is that they are exceptions *r.o* the rule. Last night I read a statement by Chief Judge Dethridge to the effect that section 25n was considered by him to be a command from this Parliament to take into consideration the economic effect of awards upon industry. But what would happen if a judge considered the economic effects of an award covering, say, the railway workers? Every State Railway Department is showing a heavy loss at present, not on account of increased working expenses, but of heavily increased interest charges. "Would a judge be entitled, on that account, to award the railway workers a lower wage ?' As a matter of fact, the language of the section allows of no discretion, for the word " shall " is used. Would it be argued that the tramway employees of Sydney and Melbourne should have their wages reduced because the tramway systems of those cities are showing a loss in consequence of serious competition from motor buses? The whole thing is ridiculous. The honorable member for Warringah **(Mr. Parkhill)** has indicated. that he intends to move an amendment to provide that judges shall, in making their awards, take into consideration the amount of unemployment that exists at a particular time. That would be .another " snide " way of instructing judges to reduce wages. Does the honorable member imagine that, oven if wages were reduced by half, more men would be employed? Employers never engage more men than they require to operate their plants efficiently and profitably. Does any honorable member think that if the fees of doctors and lawyers were reduced by half, more doctors and lawyers would be engaged? . Does r,he honorable member for Fawkner **(Mr. Maxwell),** for instance, employ a single clerk in his office in Melbourne out of pure goodness of heart? If barristers were to cut their fees in half not one more would be practising than is practising to-day. It has been suggested by honorable members opposite that they are favorable to the maintenance of our wage standards. Yesterday, I mentioned the names of two representative employers who indicated their desire to reduce wages. Let me add two more to them. The Hon. William Brooks, a member of the Legislative Council of New South Wales, speaking at an employers' federation conference not long ago, said that they should entirely remove the entanglements of the Arbitration Court and make it possible for the employers and employees to meet at round table conferences without any restrictions. I can imagine what would happen if such conferences had not behind them the influence of the- Arbitration Court! I well remember that in the old days, when we met the employers at round table conferences and asked for an increase of wages, we were frequently told that it would be wise for us to look for another job. **Mr. Elphinstone,** a member of the Queensland Legislative Assembly, who represented Oxley up to the time of the last election in that State, has said that Australia needs half a million immigrants every year, and that the Arbitration Court with all its industrial entanglements should be wiped out of existence, because high wages and artificial conditions cause industrial chaos. {: .speaker-JUR} ##### Mr McTiernan: -Is he a Nationalist ? {: .speaker-KMZ} ##### Mr MARTENS: -- Yes. The following is an extract from a transcript of the proceedings in the pastoral case heard by the court in Sydney. The Chief Judge of the Arbitration Court made this statement - >But now I am faced with a most enjoyable task; I can assure you that I am having a lovely time just now. I «.m enjoying life. If I get down to frivolities, this is a real treat to me just now. Together with the Prime Minister, and with the State Premiers, I am faced with the disgusting job of adjusting conditions, wage, conditions, ' in accordance with economic realities. We are enjoying ourselves, the whole lot of us - **Mr. Scullin, Mr. Bavin, Mr. Hill, Mr. Hogan,** and **Mr. McCormack** - the Prime Minister and every State Premier ; I do not care what their political creeds may be, but I say that we are deserving of the most heart-felt sympathy in the ugly work that we have to do. This judge tells the people of this country that the work of adjusting the conditions in industry is a " disgusting job " and "ugly work". We are asked to consider the amount of unemployment; but honorable members opposite are not concerned about that. There is no trouble about adjusting industrial conditions when it is proposed to cut down wages. The Attorney-General is well advised in seeking to remove this section from the act, considering that Judge Lukin and Judge Dethridge have said that they recognize it as their duty at all times . to take into consideration the economic conditions existing in industry. {: #debate-21-s4 .speaker-KYI} ##### Mr PROWSE:
Forrest -- I regret that the Attorney-General proposes to delete section 25n of the Commonwealth Conciliation and Arbitration Act. When the present session Of Parliament was opened the Prime Minister made an impassioned appeal to us to sit as an economic council. I should like to know if he is in agreement with the Attorney-General in seeking to delete this section at a time when Australia is in a most serious financial position. The honorable member for Herbert washes ito know whether 'the honorable member for Warringah and the honorable member for Gippsland suggest that wages should be cut in halves, but I point out the provisions of the act will prevent that. Section 25j) contains . the following proviso : - 'Provided that this section shall not affect the practice of the court in fixing the basic wage ". Does the honorable member for Herbert imagine that we should ignore economic principles in our legislation? Should not the claims of the community be considered? Why should the interests of one section, the workers, be regarded as paramount? Honorable members heard the budget speech to-day with tremendous surprise. It forecast a deficit of about £14,000,000. The sum of £1,000,000 has been voted for the relief of unemployment, but unemployment is increasing. The Government should realize that the court must consider whether Australia is able to maintain uneconomic industrial standards. I favour a high standard of living if an industry or an individual is able to afford it; but since Parliament has been invited to sit as an economic council, and put aside party considerations in order that the best interests of the community as a whole may be considered, it is inconsistent for the Government to ask that the safeguard provided by section 25d be removed. {: #debate-21-s5 .speaker-KFA} ##### Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP -- I am surprised that the Government proposes to delete this section, but, despite the remarks of the Attorney-General, I still have hope that consideration will be shown for the claims of the consumers. I 'remind the committee of a statement, made by the Prime Minister that the. Labour party has been returned to office to advance the interests of trade unionists. I point out that trade unionists are consumers, and, in some cases, they are also producers. If an award has the effect of increasing the cost of an article that is manufactured in this country, the manufacture of it will be reduced and further unemployment will be caused. The award given by the tribunal appointed under the Industrial Peace Act to deal with the dispute on the northern coalfields in New South Wales had the effect of raising the price of coal and increasing the wages of the miners. The mineowners obtained additional profit and the workers benefited; but the interests of the consumers were sacrificed. If this section is struck out of the act, similar arrangements to that made between the coal-owners and their employees may be entered into, and this will have the effect of increasing the prices of commodities to the community. The shipowners fought the claim of their employees for increased wages halfheartedly and passed on the increase to the community in the form of increased freights. I appeal to the Government and its supporters to give due consideration to the great body of people who do not benefit by awards of the Arbitration Court that are made by tacit agreement between employers and employees and result in the prices of particular commodities being raised. Some " of the goods manufactured in Australia are protected by a tariff of over 100 per cent. An article that costs 2s. Id. overseas cannot he landed in Australia under 9s. When thi; cost of an article made in Australia is raised owing to agreements between employers and employees for increased wages, the Tariff Board is approached, and an increased duty is obtained. Without this saving provision in section 25d the prices of many commodities may be raised. An appeal for greater protection will be made to the Tariff Board, on the ground that production is unprofitable; and the next step will be the introduction of an amended tariff schedule to carry out this farcical arrangement. The principal cause of high costs in Australia has been the. setting up of a certain standard of living. I have asked many times what is meant by the standard of living. Is it the standard of the man who is actually in work? It it is, what about those poor unfortunate people who are not in work? It is of no use to discuss the standard of living with a man who is out of work. The greater the unemployment, the lower is the general standard. If we delete the section that makes it mandatory for the court to take into consideration the economic effects of awards, we shall remove a safeguard against soaring costs. That is one means by which we can keep down the cost of living and the cost of production. If employers and employees enter into what is really an illegitimate agreement, and ask the court to recognize it as an award, the court, not being bound by the provisions of section 25d, will be in a position to place its imprimatur on that agreement; and immediately, up will go the cost of living, and the consumer will be further exploited. The primary producers are the only people in Australia who not only sell their products on the Australian market but also have to compete against other countries. They cannot make an agreement whereby their prices will be raised, such as can be made by secondary industries, which can never hope to export, but which enjoy the shelter that is afforded by the tariff wall. Wool, butter, wheat and dried fruits have to be sold on the world's markets. How are the primary producers going to fare when the cost of the food, clothing and other necessaries that they purchase is raised? They cannot pass on their costs as the manufacturer is able to do.If the economic effect of awards is not taken into consideration, the farming community, which is the backbone of Australia, will get it "in the neck" to an even greater extent than has previously been the case. If the Labour party intends to appeal to the farmers for their votes in the future, it must be able to show that it has reduced the cost of the articles that they purchase. The removal of this safeguard against rising costs will be regarded by the manufacturers and their employees as an invitation to get together and raise prices behind the tariff wall. Since the present Government came into office, there have been in charge of the Department of Trade and Customs two Ministers who have shown themselves to be very complacent when requested to impose higher duties. The **CHAIRMAN (Mr. McGrath).I** have allowed the honorable member to make incidental references to the tariff in support of his argument. I ask him now to confine himself to the amendment. {: #debate-21-s6 .speaker-KFA} ##### Mr R GREEN:
RICHMOND, NEW SOUTH WALES · CP -- The tariff on a number of articles has been increased; in some cases no doubt as a result of arrangements that have been made between employers and employees. But that fact has not been disclosed to the judge when he has had before him an application for the variation of an award ; consequently, the cost of production has been increased, and both sides have benefited accordingly. But the primary producers, who are the only people to whom Australia can look to get her out of the financial morass in which she is now floundering, are not able to pass on their additional costs. We must be in a position to prevent the court, or any similar absurd and futile body, from overlooking the fact that there is another party in addition to the two parties that appear before it. It is on behalf of that third party, the consumers, that we make this appeal. {: #debate-21-s7 .speaker-JSC} ##### Mr BRENNAN:
AttorneyGeneral · Batman · ALP -- I suppose that common politeness requires that I take some notice of the amendment that has been proposed by the honorable member for Warringah **(Mr. Archdale Parkhill).** That amendment originally stood in the name of the honorable member for Wakefield **(Mr. Hawker)** ; but, apparently, upon reconsideration, he decided not to press it. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- That is not so. He was not able to be present, and he asked me to move it. {: .speaker-JSC} ##### Mr BRENNAN: -- Since it has been moved no honorable member opposite has addressed himself to it. I take leave, as the representative of the Government, to draw it out of its obscurity, and give it at least as much attention as it deserves. I regret that the Government cannot accept it; and I feel certain that the honorable member who moved it feels no surprise at that fact. But I am indebted to him for having supplied me with an argument which, although intended to be in support of the amendment, was directed to its well deserved destruction. The proposal now is, that instead of the court considering the economic effects of awards, it is to be invited to consider the effect of an award or order in relation to employment, or unemployment, in the industry, or industries, directly concerned, and in other industries. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- What is wrong with that ? {: .speaker-JSC} ##### Mr BRENNAN: -- The honorable gentleman knows perfectly well that this tearful reference to employment and unemployment, being an exaggerated kind of political gesture, is open to all the objections that the section, in its original form, invited, and a great many more in addition. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- Surely unemployment is not a gesture, but a reality, to-day ! {: .speaker-JSC} ##### Mr BRENNAN: -- The honorable gentleman has called my attention to the definition of "industrial matters," in support of his claim that the section should, be retained in its original form. That definition emphasizes what I said earlier to prove that, in the exercise of his discretion the judge may traverse an exceedingly wide field of inquiry. The conclusion of the definition states that it includes " all questions of what is fair and right in relation to any industrial matter, having regard to the interests of the persons immediately concerned and of society as a whole." Those words emphasize my point that there is a complete and an ample discretion in the court to consider all interests, including the interests of society as a whole. The honorable gentleman could hardly have given greater point to my argument; he has clinched it. May I venture to ask the committee to press on with the bill? It is undesirable to suggest that we should, if possible, avoid a discussion of these matters in the early hours of the morning, or under great pressure. {: .speaker-KFS} ##### Mr Gullett: -- The honorable gentleman should not threaten. He took the bill away and sat on it for a week. {: .speaker-KZO} ##### Mr Latham: -- If the honorable gentleman thinks that that is the way to get bills through, he is making a mistake. {: .speaker-JSC} ##### Mr BRENNAN: -- With great respect to those members opposite who are not disturbed, as well as to those who are irate, I suggest that we should endeavour to push on with the bill and get it through under reasonable conditions. Seeing that the work has to be done, they ought not to stonewall this very important industrial measure. **Mr. gullett** (Henty) [9.12]. - I am not at all surprised that the AttorneyGeneral should treat with contempt a proposal that judges and conciliation commissioners should show some concern for unemployment when they are making their awards. If the honorable gentleman and his colleagues had any real concern for unemployment, they would not be " fooling away " the time of this Parliament with a punitive, bitterly-biased measure such as this. The amendment provides the most logical means of expressing the economic position. I know of no consideration that should more clearly guide the judges of this court than that of the probable effects of awards upon unemployment and employment. The disregard of the judges of the Arbitration Court, on a number of occasions within recent years, of the probable economic effects of awards upon employment and unemployment, has been one of the greatest factors that have brought about the present state of unemployment in Australia. A parallel is often attempted to be drawn between the present state of unemployment and industry in Australia and that which exists in an old country like Europe. To me there is something common all over the world in the present depression; but it is only something. Even in its present depressed state, this young country abounds with opportunities for profitable production, provided that our cost level is right. Unemployment is. not peculiar to this depressed year; it was running abnormally and strongly in Australia three, four, five years ago, when prices for wool were booming, when there was borrowed money in abundance, and when there were present all the conditions that make for great prosperity. The abnormal unemployment that existed despite the general prosperity of the country was due largely to the extreme and fanciful awards by the Arbitration Court and other tribunals. The fault was not necessarily that the wages awarded were too high, but rather that the hours were reduced to a ridiculous and economically unsound level and piece-work was not awarded by judges, who ignored economic considerations. Undoubtedly one of the greatest factors in the .creation of unemployment was the award of a 44-hour week in the engineering trade. I watched the effect of that award closely through the Trade and Customs Department. Before it was given, engineering, generally speaking, was prospering and the tariff was adequate, but soon after the hours were reduced from 48 to 44 the engineering industries began to languish and employment diminished. That was a direct consequence' of an uneconomic award. Honorable members opposite, parrot-like, repeat the allegation that we on this side of the chamber advocate low wages. That is untrue. But we do not believe in awards so extraordinary and fanciful that they punish the workers by robbing them of their employment. The statistics show that during years of comparative prosperity unemployment was above normal. Why? Simply because it did not pay capital to employ labour at the wages and under the conditions awarded by the courts. Do members supporting the Government say that such awards were in the interests of the workers? Have they and the officials in the trades halls lost all sympathy for the unemployed? To-day between 14 and 15 per cent, of our workers are without jobs, and to that extent wages have fallen. In other words, the total sum of wages paid is 15 per cent, short of the amount required to employ all the workers in this country. {: .speaker-K0A} ##### Mr Gabb: -- Is there no unemployment in India? {: #debate-21-s8 .speaker-KFS} ##### Mr GULLETT: -- That interjection is indicative of the mentality of honorable members opposite. There is no comparison between this vast, young, richly endowed, sparsely populated and undeveloped country, and old and hopelessly overcrowded India. {: .speaker-K0A} ##### Mr Gabb: -- But in India long hours are worked. {: .speaker-KFS} ##### Mr GULLETT: -- The honorable member for Bendigo **(Mr. Keane),** and others have argued that if the number of working hours is increased the number of men employed must be reduced. Certainly, if in a given area there is work for only 100 men at 44-hours a week, an increase in the working hours will necessitate a reduction of .the number of men employed. But in this young country there is an unlimited amount of work or production to be done at a fair price, but if, through the reduction of hours and the imposition of uneconomic conditions, production cannot continue at a profit, obviously employment must shrink, or, at best, cannot expand. But unfortunately men are encouraged to say that they will not work 48 hours, and because industry cannot afford to employ them under the conditions they demand, they and their wives and children are obliged to starve. Labour members say in effect that it is preferable for fifteen in every 100 people to be workless, homeless, and foodless than that reasonable hours should be worked, so that industry generally might be prosperous and capable of absorbing all the labour that was available. I am advocating only reasonable working conditions. Extend the hours to 48 per week in all but noxious trades, and encourage the judges to introduce piecework wherever practicable. Only by those means will the evil of unemployment be cured. Insistence upon extreme and fanciful conditions merely aggravates the cruelty to the workless. I have said before that there is no parallel between this young, undeveloped country and the overcrowded, almost exhausted countries of the old world. Australia has limitless possibilities of production on an economic basis; therefore, the plea that awards of the Arbitration Court; should have regard to employment and unemployment is reasonable. When section 25d was proposed in 1928, I voted against it because I did not believe that there was anything economic about the Arbitration Court. In any circumstances I thought that the judges should have enough common sense to consider the probable economic effects of their awards. But that section was inserted in the act, and the resolve of the Government to delete it is sinister and suggestive. I appeal to honorable members to recognize that in view of the scores of thousands of unemployed in Australia to-day the proposed instruction to the court to consider the effect of its awards upon employment is fair and proper. {: #debate-21-s9 .speaker-KYZ} ##### Mr RIORDAN:
Kennedy .- Had the Labour party been in office for the past six years one could understand the tearful concern of members of the Opposition for the unemployed. The fact is that the present unemployment problem was created by them. The BrucePage Government continued a vigorous migration policy, and the country was flooded with aliens. The result is to be seen to-day; J 5 per cent, of Australian workers are walking the streets, and on the Queensland cane-fields "no Britisher need apply". The men engaged at Goondi sugar mill for the 1930 season were: Italians, 208; Jugo-Slavs, 48; Maltese, 17 ; Greeks, 8 ; South Americans, 1 ; Britishers, none, although 200 offered. That is a consequence of the Bruce-Page Government's policy. Yet the honorable member for Henty **(Mr. Gullett)** has the hide to accuse the Labour Government of having caused unemployment. It 13 immaterial whether section 25n remains in the act or is struck out, but the Labour party does not believe in dictating to the Arbitration Court. If wo are to pay high salaries to judges and conciliation commissioners, why should we dictate to them how they shall make their awards? If Parliament is to do that, it might as well fix the hours and wages in industry, and save the cost of the Arbitration Court. Members of the Opposition insist that the court should pay regard to the economic effect of its awards. When, during the war period, metals reached peak prices, was the economic state of the industry reflected in the wages of the workers? Had it been, miners would have been receiving from £2 to £2 10s. a day. {: .speaker-JVR} ##### Mr Nairn: -- No miner can earn that wage in Australia to-day. {: .speaker-KYZ} ##### Mr RIORDAN: -- No capitalist leaves his money in industry unless it is earning more than he can get from government bonds. After all, who produces the wealth of the country? During the war the price of fat cattle went up to £20 a head, but the workers engaged in the cattle-raising industry on a wage of £4 a week got no "rake-off." Nevertheless, when the price of cattle fell to as low as £1 a head, the economic effect on the industry was taken, into consideration, and the workers suffered a 12-J per cent, reduction of wages as the result of an agreement reached at a round table conference. Round table conferences are very good things for the boss, but my advice to the workers when going into such a conference is to put on their pads, because all they are likely to get is a good kick on the shins. The honorable member for Gippsland **(Mr. Paterson)** said that the economic effect on primary producers was not taken into consideration in fixing the prices of their products, but [. remind him that the workers of Australia are paying for butter a much higher price than similar Australian butter is being sold foi' overseas. Members of the Country party plead for the primary producers, but it is interesting to recall that at least one representative of the primary producers in this House accused the members of the Country party of having committed adultery with the Nationalist party. The fact is that the Country party lias sold out to the Nationalists. It is the Labour party which is the real friend of the primary producers. As a result of securing for the workers improved conditions, the Labour party has made it possible for them to give greater support to the primary industries, thus making them prosperous. The Labour party's policy has given the sugar industry into the hands of our own people. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- Particularly at Innisfail. {: .speaker-KYZ} ##### Mr RIORDAN: -- The people of Innisfail and of other parts of Queensland are prosperous. Queensland is the most progressive State of the Commonwealth, and her population has so increased within recent years that after the next Commonwealth census she will be entitled to an additional representative in this Parliament. When the sugar farmers of Queensland employed cheap Kanaka labour they were anything but prosperous, even though land was cheap. Now the conditions of Australian workers have been so improved that they are able to pay a higher price for Aust ralian sugar, and the industry can be carried on profitably. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- It is done by making the Australian worker pay twice as much for sugar as it can be bought for overseas. {: #debate-21-s10 .speaker-10000} ##### The CHAIRMAN: -- It is most disorderly for the honorable member for Warringah to interject continually after the chairman has called for order. {: #debate-21-s11 .speaker-KYZ} ##### Mr RIORDAN:
KENNEDY, QUEENSLAND · ALP; FLP from 1931 -- It is not likely that arbitration judges or conciliation commissioners will ignore economic facts to the extent of issuing awards which will injure industry, and throw people out of work. The honorable member for Henty **(Mr. Gullett)** said that even during prosperous years there was unemployment as a result of awards issued by the Arbitration Court. It is true that there has always been unemployment, but it has not been due to Arbitration Court a wards. There are in Australia several seasonal industries which operate actively for only a few months in the year. When they close down the men engaged in them are thrown on the labour market, and have to search for employment elsewhere. The sugar industry furnishes an example. During the busy season 20,000 persons or more are employed in it. In the pastoral industrya great many persons are employed during the shearing season, but when the season is over they are thrown out of employment, and no one gives any consideration to them. Nationalist Governments have had ample opportunity during the last fourteen years to make some provision for the victims of seasonal unemployment, whose services are necessary to the primary producers in harvesting their crops. Queensland did make some attempt to insure such workers against unemployment, so that they would have something to carry them over the slack period. We hear a great deal about the rights of the consumers, but it should be remembered that the majority of the consumers in Australia are wage-earners and their dependants. All the Arbitration Courtis asked to do is to fix a reasonable living wage for a. man, his wife, and family of three children. Of course, there might be eight children instead of three, but no official provision is made for their maintenance. Perhaps the wage-earner is supposed to knock them on the head, or drown them like a litter of pups. I maintain that society has the duty of providing those engaged in seasonal occupations with sustenance during the period they are unavoidably out of work. Personally, I do not think that it matters very much whether section 25d is deleted from the act or left in it. However, I favour its repeal, because I do not agree that this Parliament should dictate to the Arbitrat ion Court. {: .speaker-KXQ} ##### Mr Archdale Parkhill: -- Even though there is a Judge Lukin on the Bench? {: .speaker-KYZ} ##### Mr RIORDAN: -- If we on this side were as class-conscious as is the honorable member, Judge Lukin and Judge Dethridge would not have lasted on the Bench 24 hours after this Government came into office. We have not raked Australia inan effort to dig up some one sufficiently biased to attack the class which the honorable member represents. {: .speaker-KHG} ##### Mr Archdale Park hill: -- The workers are my class. {: .speaker-KYZ} ##### Mr RIORDAN: -- The honorable member for Warringah is the most classconscious member in this House, and I will say that he fights very well for his class. The last Government represented a class hostile to the workers, and it had no hesitation in "packing" the Arbitration Court Bench. After it had flooded the country with immigrants, and created a great deal of unemployment, it appointed three tools to the Arbitration Court to do its dirty work. {: #debate-21-s12 .speaker-JVR} ##### Mr NAIRN:
Perth .- The honorable member who has just resumed his seat is very much enamoured of the Queensland sugar industry. Yet, I understood him to say that at the present time an Australian could not find employment in that industry. If that be so, it is a sad reflection on the activities of the Labour movement, which has brought Australian workers to such a pass that they cannot compete with Italians. I believe that Australians are physically and mentally better than Italians, and that if they cannot compete with Italians it is simply because they are not willing to do the joh. If they do the work as well as the Italians they will be given employment, but if they continue to listen to those who make their living out of the workers - who advise them to go slow and to do as little as possible for the money they receive - they will continue to be ousted by persons from overseas. A man who will not do an honest day's work for a fair day's pay is dishonest. He deserves to be forced out of his job, and, if he is, it serves him right. I have no sympathy with that class of person. The class which has my sympathy are those who are anxious to work, birt are not able to get jobs. During the last election campaign honorable members on the other side were very solicitous about the unemployed. Now any reference in this House to unemployment has the effect of raising a storm from that side. The interest of honorable members opposite in unemployment has flagged. The Labour Government and those who sit behind it have abandoned the unemployed. t {: .speaker-JUR} ##### Mr McTiernan: -- I rise to a point of order. I submit that the honorable member's remarks are not relevant to the clause under discussion. {: #debate-21-s13 .speaker-K7U} ##### The TEMPORARY CHAIRMAN (Hon It A Crouch:
CORANGAMITE, VICTORIA -- The honorable member for Perth is in order. {: .speaker-JVR} ##### Mr NAIRN: -- The Government is really interested not in the unemployed, but in those who hold good, " cushy " jobs. Seventy-five per cent, of the population of Australia is in comfortable employment. The other 25 per cent, are either unemployed, or have only very precarious employment. The Government is doing nothing for that 25 per cent. We know that the national income is £80,000,000 to £100,000,000 lower this year than last, and it is obvious that the total sum divisable among the population is reduced to that extent. If, in these hard times, we continue to allow the 75 per cent, of our people who are in good positions to enjoy their advantages to the full, we shall undoubtedly reduce the other 25 per cent, to almost utter destitution. It is ridiculous to claim that we are maintaining our high standard of living in Australia when 25 per cent, of the people are at poverty point. Every month the number of unemployed persons in Australia is increasing. Although Australia is not bankrupt, she is insolvent in this sense, that if she were called upon to-morrow to pay her debts she could not do so. Surely the time has arrived when we should look at these matters squarely. If ever there was a period in our history when our Arbitration Court judges should be directed to have regard to the probable economic effect of their awards it is now. {: #debate-21-s14 .speaker-JT7} ##### Mr MCNEILL:
Wannon .- The honorable member for Henty **(Mr. Gullett)** has suggested that the Government has a sinister object in seeking to repeal section 25d, but I remind him that the Conciliation and Arbitration Act worked satisfactorily for more than twenty years before this section was put into it. Honorable members on this side of the chamber consider that this provision is entirely unnecessary. In the period 1914 to 1918, this country enjoyed great prosperity; we had a succession of good seasons and received good prices for our products. But on only one occasion during that time did an industrial tribunal take our prosperity into consideration in making an award. The one exception to the general rule was when the late **Mr. Justice** McCawley, of Queensland, granted an increase of wages to the workers in the pastoral industry because of the prosperous condition of that industry; but that advantage was subsequently withdrawn. It is manifestly impossible for any judge or conciliation commissioner to say with certainty what the economic condition of an industry will be six or twelve months ahead. An industry may be languishing to-day and be prosperous six mouths hence. In these circumstances, this section should be 'repealed. I should like to see some honorable members opposite, who have criticized the Arbitration Court for awarding high wages, attempt to maintain a family' on £5 a week - and it is rarely that the court has awarded so high a wage as that. The honorable member for Henty would like to see the hours of work lengthened and the rate of wages reduced. {: .speaker-KFS} ##### Mr Gullett: -- I did not say anything about reducing wages. {: .speaker-JT7} ##### Mr McNEILL: -- The honorable member said that the court was ruining our industry by granting high wages; but that is not so. The courts have never granted exorbitant wages to our workers. The awarding of a -14-hour working week has been criticized by honorable members opposite, but I can' assure them that even the employers in the pastoral industry are favorable to the retention of the 44- hour week. Statistics have shown that more work is now being done in 44 hours than was formerly done in 48 hours. I do not suggest that a 44-hour week would have that result in every industry, but undoubtedly it suits the pastoral industry. I trust that this section will be repealed, for its retention can only cause unnecessary confusion. {: #debate-21-s15 .speaker-KNP} ##### Mr MAXWELL:
Fawkner .- There seems to bc a considerable difference of. opinion among Government supporters as to why this section should be repealed. The impression made upon my mind, as I have listened to the speeches that have been made upon this subject, is that the main reason honorable members opposite have for desiring the deletion of the section is that it was originally placed in the act by another government. There is a good deal of inconsistency in the arguments of honorable members opposite. At one moment they say that Parliament should not dictate to the judges of the court as to how they should act, and at another moment they say that it is quite proper to direct the judges to act according to the equity, good conscience and substantial merits of the cases submitted to them. The honorable member for Parkes **(Mr. McTiernan)** has suggested that this section should bc repealed because of the difficulty of satisfactorily defining " economic effects." He has said that this is a vague phrase, and that all reasonable requirements are met by the provision that the judges " shall act according to equity, good conscience and the substantial merits of the case." But I ask the honorable member whether he could satisfactorily define "equity." This word, like "economic," is commonly used, and is well understood by the community. In my opinion a judge cannot have regard to equity in making an award unless h* has already considered the probable economic effects of it. {: .speaker-JSC} ##### Mr Brennan: -- Is it not a fact that the terms equity, good conscience and substantial merits of the case are all an enlargement of the discretion of the judge, whereas the direction that he shall have regard to the probable economic effect of his award is to some extent a restriction of his discretion? {: .speaker-KNP} ##### Mr MAXWELL: -- If it is a restriction it is a necessary one. Every section of the act which gives the judge any directions is a. restriction of his discretion. Just as the honorable member for Parkes would have difficulty in satisfactorily defining "equity," so he would have difficulty in defining "good conscience." {: .speaker-JUR} ##### Mr McTiernan: -- "Equity and good conscience " is a well-known legal phrase. {: .speaker-KNP} ##### Mr MAXWELL: -- That is true; but so is " economic effects." I suppose that the honorable member has himself frequently used the expression "economically sound " ; yet he wants us to rule the word " economic " out of our vocabulary. Can it be imagined that a judge would act according to bad conscience? The term " substantial merits of the case " is also very difficult to define; but yet well understood by the ordinary man. After all, what the legislature is asking the judges to do is to give the parties fair play. The honorable member for Forrest **(Mr. Prowse)** made an excellent point in his speech on this subject. when he reminded us that an invitation had been extended to us to resolve ourselves, at this critical juncture in our history, into an economic conference or convention. What does that mean ? It suggests that inasmuch as we are ordinarily prone to look at the measures coming before us from our own particular party point.'' of view, the Government has invited us to sink party considerations and deal with every measure from what the Prime Minister calls the economic point of view, having regard to the interests of the community as a whole. Surely, if it is necessary for us to act in that way, what is more reasonable than that a judge who is called upon to adjust the differences between the parties to industry should be reminded that, although we have already asked him to deal with cases from the aspect of equity and good conscience, and to have regard to their substantial merits, it is essential that the probable economic effects of awards should be considered. He should be asked to deal with every case, not from the point of view of either the employer or the employee, or merely from the point of view of the community, but having regard to the interests of all three. Only if he does that, will he make an award that is economically sound. I also emphasize the point made by the honorable member for Richmond **(Mr. R. Green)** showing the necessity to have regard to the interests of the community. What, after all, is an economically sound, award? It implies that the industry in question must provide the employers with a fair profit and give to the worker a fair wage, and it is to supply to the consumer the commodity involved at a fair price. Any industry that does that is economically soundly based. {: .speaker-JSC} ##### Mr Brennan: -- Would a judge be prevented from doing that, or be hampered in any way, if the section were deleted? {: .speaker-KNP} ##### Mr MAXWELL: -- He might not be; but the point has been emphasized in this debate that the real reason for proposing that the section be struck out is that it was inserted in the act by the BrucePage Government. I believe that certain pressure has been brought to bear on the Ministry to secure its deletion. {: .speaker-JSC} ##### Mr Brennan: -- That is not worthy of the honorable member. {: .speaker-KNP} ##### Mr MAXWELL: -- Does the AttorneyGeneral suggest that this matter is not of vital interest to the trade union movement? Does he deny that strong expressions of opinion have been made by members of trade unions in regard to this very section ? {: .speaker-009FQ} ##### Mr Curtin: -- It was inserted despite the repeated protests of the Opposition. {: .speaker-KE4} ##### Mr Keane: -- And of organized labour outside. {: .speaker-KNP} ##### Mr MAXWELL: -- That is so. The present Government prides itself that, above all else, it represents organized labour, and there is a strongly expressed opinion by organized labour in regard to this very matter. It may be fairly said that the Government has yielded to the pressure of organized labour in this case. This proposal is in strict accordance with the views expressed by the leaders of organized labour. {: .speaker-JSC} ##### Mr Brennan: -- It is in accordance with the opinion expressed by every member of this Government before the section was inserted in the act, and that is the reason why, without consulting anybody, I proposed that it be struck out. {: .speaker-KNP} ##### Mr MAXWELL: -- I accept that statement; but the fact remains that the Attorney-General has said that it is an obnoxious provision. Why should it be obnoxious to anybody? It has been pointed out that whether the section is retained or not, the judge will have regard to the economic effects of his awards. I ask the honorable member for Fremantle **(Mr. Curtin)** "What effect do you expect the deletion of this section to have on the judges of the court? " {: .speaker-009FQ} ##### Mr Curtin: -- As I am not a judge 1 am not in a position to say what effect it will have on them. {: .speaker-KNP} ##### Mr MAXWELL: -- Perhaps I. should have asked the honorable member " What effect does the honorable member for Fremantle think that the deletion of the section would have upon awards of the court ? " Surely there must be some object in striking out the section. {: .speaker-JUR} ##### Mr McTiernan: -- What effect does the honorable gentleman say the retention of the section would have upon the decisions of the judges? {: .speaker-KNP} ##### Mr MAXWELL: -- I think that it would emphasize the idea of Parliament that the probable economic effects of awards should be borne in mind by judges. It may be said that a judge would have regard to those matters without being reminded of them, butwe should make assurance doubly sure. An award would be a vicious one if consideration had not been given to its probable economic effects on the industry concerned. I wish to ensure that economic considerations shall not be overlooked. I am afraid that the amendment of the honorable member for Warringah **(Mr. Parkhill)** does not fully meet the position. It provides that a judge should take into consideration at least some of the economic effects of his award, but I contend that he should have regard to all the probable effects, so far as he can ascertain them. {: #debate-21-s16 .speaker-KE4} ##### Mr KEANE:
Bendigo .- Few members have referred to the effect of the section inserted in the act by the BrucePage Government. It was the direct cause of two of the biggest industrial upheavals in Australia. One of them was the timber-workers' strike, and the application of this section by the judge on that occasion was one of the biggest atrocities in the industrial life of this country. The employers in that case were allowed to present evidence to which the union advocates had no access, and of which they had no opportunity of repudiation, although the organization represented 20,000 workers. Of all the amendments made by the act of 1928, the addition of this section was the worst. Its operation has proved to be disastrous, and productive of mistrust of the federal judiciary. In the discussion of a matter of outstanding importance such as the section proposed to be deleted, many wild statements have been made. It has been said that the conciliation commissioners will make extravagant awards. It was also claimed in 1928 that this section Avas necessary for the guidance of the judges of that period. So far as my recollection of the awards of the Arbitration Court go, none can be said to have put any industry out of business; but, on the other hand, in practically every case the scale of wages that I have already indicated was awarded, that is, a basic wage of £4 6s. a week and marginal rates from ls. to 3s. That is the net result of federal arbitration to employees in Australia, and honorable members opposite cannot prove to my satisfaction that this section was necessary in connexion with any award. I believe that it's deletion is a corollary to the appointment of conciliation commissioners. There will be no more bewigged judges or lawyers without knowledge of industrial matters deciding arbitration cases; they will confine their activities to making trouble elsewhere. We require an act that will not cause irritation to the people working under it. The introduction of this section was one of the greatest blunders of the late Government, and its deletion will be one of the outstanding achievements of the present Ministry. **Mr.** archdale parkhill (Warringah) [10.15]. - The honorable member who has just resumed his seat has not followed the debate very closely, because obviously he did not hear the statement of the Attorney-General **(Mr. Brennan),** repeated half a dozen times, that it was unnecessary to insert this provision in the bill, because, already, under other provisions, the judges are directed to take these factors into consideration. Therefore, if all the disastrous consequences that the honorable member states have already resulted from the operation of this provision have really occurred - and I venture to assert that they have not - there is every certainty that they will recur in the future. That disposes of the argument of the honorable member, although he advanced it with the assurance of one* who has a profound and an intimate knowledge of industrial matters. I am not very keen to have inserted a reference to employment, because, as the honorable member for Fawkner **(Mr. Maxwell)** has pointed out, if the judge must take into consideration the economic consequences of an award upon society as a whole - and the Attorney-General says that he must; - then he must take into consideration the question of employment. On the subject of immigration, the honorable member for Kennedy **(Mr. Riordan)** purported to reply to the honorable member for Henty **,(Mr. Gullett).** He alleged that Australia is being flooded to-day with foreign immigrants who are fighting Britishers for positions in the industrial world. He also charged the last Government with having- brought those foreigners into Australia. The fact is that every man who was assisted to come to Australia during the period that the Bruce-Page Government was in office was brought here on the recommendation of a State Government; he could not get any assistance from the Federal Government unless he was so recommended. Those recommendations were made by Labour as well as Nationalist Governments, including the Labour Government led by **Mr. Collier** in Western Australia, that led by **Mr. Hogan** in Victoria, and that led by **Mr. Lang** in New South Wales. Consequently, if any damage has been done by assisted immigrants from Great Britain - and I deny that it has - the State Governments which recommended them to the Federal Government are responsible first and last. Not one shilling of public money was advanced by the Bruce-Page Government to assist any foreigner to come to this country. Every foreigner who came here paid his own passage, and before he was allowed to land he had to prove that he possessed £40. If these men are competing with Britishers in Queensland, as the honorable member for Kennedy says they are, whose fault is it, seeing thaton the statute-book of Queensland is a law that was enacted by the Denham Government, which, if operated, would prevent any foreigner from taking up land in that State? Why this hue and cry, seeing that a Labour Government in Queensland had the power to prevent foreigners from becoming competitors with Britishers, but, by its own neglect and default, failed to exercise it? Amendment negatived. Question- Thatthe clause be agreed to -put. The committee divided. (The Chairman - Mr. McGrath.) AYES: 39 NOES: 18 Majority . . . . 21 AYES NOES Question so resolved in the affirmative. Clause agreed to. Clause 18 agreed to. Clause 19 (Representation of parties at hearing). {: #debate-21-s17 .speaker-KZO} ##### Mr LATHAM:
Kooyong .- Under the alteration made to the act by this clause, the leave of the court and the consent of all the parties will be required before a lawyer can appear before the court. This is a re-introduction of an old pretence. The section provides that no party appearing before the Arbitration Court shall be represented by counsel, solicitor, or paid agent. Everybody knows that both unions and employers have always been represented in the Arbitration Court by paid agents. The pretence is to be maintained that everything will be all right so long as a man skilled in the law is not employed. I had a particular reason for rising to address myself to this clause. It is often stated that the time of the Arbitration Court has been occupied unduly in the past by lawyers who have appeared before it in industrial disputes. The honorable member for Flinders **(Mr. Holloway)** repeated that old story, and said that the time occupied in disposing of a case had been lengthened by the methods that had been adopted by the legal representatives on both sides. He went on to say, " This has often been stated by the Leader the Opposition." I have never made that statement. Any one familiar with the Arbitration Court knows that 98 per cent. at least of the cases are handled by union secretaries or representatives, and the industrial officers of the employers. I have referred, however, to the large expenditure on legal expenses in connexion with applications to the High Court for interpretations of the act. Rarely does a lawyer appear in connexion with the ordinary hearing of disputes in the Arbitration Court. I consider, however, that citizens whose interests are at stake have a right to employ any assistance which they consider would be most helpful to them. Clause agreed to. Clause 20 verbally amended, and, as amended, agreed to. Clauses 21 and 22 agreed to. Clause 23 (Award not to be challenged or questioned - section 31). Amendment (by **Mr. Brennan)** agreed to- >That paragraphb be omitted with a view to insert in lieu thereof the following: - > >by adding at the end thereof the following sub-sections: - (4. ) A Conciliation Commissioner or a Conciliation Committee or majority thereof may, if he or it thinks fit, in any proceeding before him or it, at any stage and upon such terms as he or it thinks fit, state a case in writing for the opinion of the court upon any question of law arising in the proceeding, or any question which by reason of the provisions of section eighteen a or eighteen aa of this act, may not be determined by a single Judge. (5.) Subject to this act the court shall hear and determine any question stated under the last preceding sub-section, and remit the case with its opinion to the Conciliation Commissioner or Conciliation Committee (as the case may be) and may make such order as to costs as it thinks fit. (6.) The Conciliation Commissioner, or the Conciliation Committee or a majority thereof ( as the case may be ) may thereupon make an award not inconsistent with the opinion of the Court, and any award so made shall have the effect of an award of the Court.' ". Clause, as amended, agreed to. Clause 24 - >Section thirty-three of the principal act is repealed. > > *Section proposed to be repealed -* > >-- (1.) *A judge may . . . make an order requiring any organisation submitting any industrial dispute to the court, to give security . . . for the performance and observance of the award . . .* Amendment (by **Mr. Brennan)** proposed - >That the following words be added to the clause : - " and the following section inserted in its stead : - > >Notwithstanding . anything contained in this act, an industrial dispute or an application to vary an award shall not be dealt with by the court or a judge thereof, in pursuance of any power conferred upon the court or judge by this act, in any case in which a Conciliation Committee has been appointed in pursuance of an application made under subsection (2.) of the next succeeding section.' ". {: #debate-21-s18 .speaker-KZO} ##### Mr LATHAM:
Kooyong .- This is a remarkable provision, although it looks innocent. The effect of it is that a dispute or application to vary an award in respect of which a conciliation committee is functioning shall not be dealt with by the court or a judge. Yesterday, I unavailingly attempted to persuade the Attorney-General to insert a simple provision that the Chief Judge should allocate the business of the court between the judges and the conciliation commissioners, but he declined to agree, apparently believing that in some mysteriousway the business of the court would manage itself. I pointed out the risk that a conciliation commissioner might trespass on a dispute that was being handled by a judge, or vice versa. But the honorable gentleman considered my fears entirely unfounded. Now he is moving an amendment to protect a conciliation committee from interference by the court or a judge; once a conciliation committee commences to deal with a dispute or application for variation of an award the court and the judges are warned off, but conciliation commissioners are not. Honorable members will see the risks of confusion that are inherent in this proposal, having regard to the rejection of the suggestion I made yesterday. Suppose a conciliation committee has been appointed to hear a dispute. It may not have done anything in the matter atall, but the mere fact of its appointmentwill be sufficient under this amendment to prevent the matter being dealt with by a judge or by the court. In another case a conciliation committee may have made an award. The committee, perhaps, consisted of men from every State of Australia, some of whom may have travelled thousands of miles to attend its meetings. The award, as is often the case, might have been for a period of five years. After two years it is found that conditions have changed in some particular, and it is necessary to vary the award, perhaps only in a formal way. Nevertheless the court is not competent to hear the application; it will be necessary to convene the conciliation committee which made the award, even though its members may have to travel from the farthermost points of the continent. This will involve more expense and more delay. If the object of the amendment is to make the system as expensive, dilatory and unsatisfactory as possible, it will certainly achieve its object. Unless the AttorneyGeneral can answer the objections I have raised, I cannot see that there is any justification for this clause. Amendment agreed to. Clause, as amended, agreed to. Clause 25 agreed to. Clause 26 - >Section thirty-eight of the principal act is amended by inserting after paragraph (o) the following paragraph: - (oa) to sot aside an award or any of the terms of an award ; ". > > *Section proposed to be amended -* > > *The court shall, as regards every industrial dispute of which it has cognizance, have power.* > > *to fixmaximumpenalties for any breach or non-observance of any term of an order or award, not exceeding One thousand pounds in the ease of an organisation or an employer, not being a member of an organisation bound by the order or award, or Ten pounds in the case of any individual member of an organization. . .* {: #debate-21-s19 .speaker-JWT} ##### Mr FRANCIS:
Moreton -- I move - >That after the word " amended " the following be inserted: - "(a) by omitting the words "One thousand " in paragraphc. and inserting in their stead the word "twenty". Mr.Brennan. - I have already made a very substantial reduction. I propose to reduce the penalty to £100. {: .speaker-JWT} ##### Mr FRANCIS: -- The AttorneyGeneral in his second-reading speech said that it was proposed to repeal all sections of the act dealing with strikes and. lockouts. He said that the whole of section 4 was to be deleted, and all of part II, with the exception of section 9. Those sections have now been repealed, and all provisions for the imposition of a penalty of £1,000 have been removed except that in the section now proposed to be amended. Apparently the Government hoped in this way to retain power to impose a penalty of £1,000, for breaches of an award by means of a strike or lockout. {: .speaker-KNP} ##### Mr Maxwell: -- What does the remaining penalty of £1,000 apply to? {: .speaker-JWT} ##### Mr FRANCIS: -- It applies to breaches of an award. In the sections which have been repealed penalties of £1,000 were provided against strikes and lockouts. Now all reference to strikes and lockouts is to be omitted from the act, but this section still retains a provision for a penalty of £1,000 for a breach of an award, so that the court could make it an offence for an employer or organization of employees to engage in a lockout or strike. By this indirect method the penalties for strikes and lockouts could be revived. {: .speaker-JSC} ##### Mr Brennan: -- If the honorable member will make his amendment specify a penalty of £100. I will accept it, and withdraw mine. {: .speaker-JWT} ##### Mr FRANCIS: -- Section 49 of theact says- >No person shall wilfully make default in compliance with any order or award. Penalty, £20. Yet section 38c will enable a penalty of £1,000 to be fixed for a breach, not necessarily wilful, but merely the outcome of neglect. At the same time, under section 49, if a person commits a wilful breach of an award, he will be liable to a penalty of only £20. Obviously, the Attorney-General has not noticed the inconsistency of those two sections. I urge him to accept this amendment in order to bring the two sections into agreement. {: #debate-21-s20 .speaker-JSC} ##### Mr BRENNAN:
AttorneyGeneral · Batman · ALP -- I do not agree that the two sections are parallel. I am prepared to meet the honorable member up to a certain point; but beyond that I cannot go. Section 38, paragraph c, enables the court - >To fix maximum penalties for any breach or non-observance of any term of an order or an award, not exceeding £1,000 in the case of an organization or an employer, not being a member of an organization bound by the order or award, or £10 in the case of an individual member of an organization. This Government was not responsible for inserting provisions for penalties of £1,000, and the inconsistency referred to by the honorable member, if it exists at all, will, by the amendment which I propose to move, be modified at least to the extent of nine-tenths. The terms of the sections are not the same, and they may not cover precisely the same set of conditions. Section 49 says that no person shall wilfully make default in compliance with any order or award, and fixes the penalty at £20. The exact relation of that to other sections for which this Government is not primarily responsible I do not undertake to say, but I do not think that we should make a reduction of penalty as great as is proposed in the honorable member's amendment. {: .speaker-KZO} ##### Mr Latham: -- Why not? {: .speaker-JSC} ##### Mr BRENNAN: -- The penalty of fi 00 proposed in my amendment is to apply to organizations or employers. £10 is the maximum penalty which may be imposed on individual members. Therefore, the penalty under section 3S is really less than that under section 49-. I thought that the honorable member for Moreton **(Mr. Francis)** might accept the suggestion I made, and allow the amendment providing for a reduction of the penalty to £100 to go forward in his name. If he will not do that I cannot see my way to accept his amendment. {: #debate-21-s21 .speaker-KZO} ##### Mr LATHAM:
Kooyong .- The Attorney-General has placed himself in a remarkable position. During his second-reading speech he said that he proposed to repeal all those provisions in the act relating to penalties of £1,000. It now appears, under the bill as originally submitted, that one penalty of £1,000 is to remain. The Attorney-General has just intimated that it is proposed to reduce that penalty to £100. It was still possible, under the bill as originally submitted, for an organization to be fined for a strike or lockout if the award under which it was working contained a provision prohibiting strikes and lockouts. I suggested to the AttorneyGeneral that the logical and consistent thing would be to include in the bill a clause similar to that which the last Government inserted in the Maritime Industries Bill, namely, that no award should prohibit a strike or lockout. The Attorney-General will not agree to that, however, and he still proposes to make it possible, under section 3S, for the court to fix a penalty for a strike or lockout, though he has found it difficult to justify the reduction of the penalty to £100. In spite of all their talk on this subject last year, honorable members opposite are not prepared to abolish all penalties from our industrial law, for section 49 provides that- >No person shall wilfully make default in compliance with any order or award. Penalty £20. and section 38 provides penalties of £1,000 and £10 for any breach or nonobservance of any term of an award or order. Although the penalty for lockouts and strikes by persons or organizations affected by awards has been deleted, the penalty for the non-observance of' awards has been retained. The enthusiasm of the AttorneyGeneral for the removal of penalites on organizations does not seem to fall below three figures. It seems to me that if any penalties are to be retained there should be a penalty for non-wilful default, for a man engaged in an industry should know the terms of the award covering it. {: #debate-21-s22 .speaker-JSC} ##### Mr BRENNAN:
AttorneyGeneral · Batman · ALP -- Honorable members opposite have for some weeks been amusing themselves by deliberately misrepresenting to the public that the Government is cutting out all penalties' against employees and retaining them against employers, although I have been at some pains more than once to say that it is impossible for us to have compulsory arbitration unless we retain certain penalties for breaches and non-observance of awards. The Leader of the Opposition is now professing to be indignant because some of these necessary penalties have been retained. I have a certain amount of sympathy with the object of the mover of the amendment, but think that he has gone too far in the circumstances. If honorable members opposite will carefully read the provisions of section 3S paragraph c and section 49 they will see that the penalty in respect of persons who innocently commit any breach or non-observance of an award is £10, whereas the penalty for a wilful breach is £20. As I have said throughout our discussion on this measure, the Government desires to minimize the penalties to the utmost extent possible, but I am not prepared to go beyond the provisions of my amendment in this particular case. {: #debate-21-s23 .speaker-KXQ} ##### Mr ARCHDALE PARKHILL:
Warringah -- Although the Government has said that it intends to remove all possible penalties, it is not doing so. Even after this bill is passed an organization which fails to send to the Registrar in the prescribed form a list of its members, will be liable to a penalty of £2 for each week of such default. But it is significant that the existing provision that a penalty of £50 shall be imposed upon an organization which fails to have a proper audit of its books made by a qualified person is being deleted. At the same time it is being provided that the books may be audited by a competent person, who will not necessarily be qualified; though even if such an audit is not made no penalty is provided. Seeing that the object of the Government is said to be to remove all unnecessary punitive provisions from the act, I submit that the amendment of the honorable member for Moreton **(Mr. Francis)** should be agreed to. Amendment negatived. Amendment (by **Mr. Brennan)** agreed to- >That after the word " amended" the following be inserted - " (a) by omitting from paragraph (c) the words "One thousand" (first occurring) and inserting in their stead the words " One hundred " ; > >by omitting the proviso to paragraph (c) ; and > >". {: #debate-21-s24 .speaker-KZO} ##### Mr LATHAM:
Kooyong >It is proposed in this clause to give the court power " to set aside an award or any terms of an award ", but not to give it power to suspend an award. In my opinion this provision will be entirely unworkable. There is no power to impose conditions as under the present section 38d. Clause, as amended, agreed to. Clause 27- >Section thirty-eight a of the principal act is amended - > >by inserting after the word "court" the words " or a conciliation commissioner "; > >by omitting the word "it" (first occurring) and inserting in its stead the word's " the court " ; > >by inserting after the word "it" (second occurring) the words " or he " ; and > >by omitting the word "think" and inserting in its stead the word " thinks ". {: #debate-21-s25 .speaker-JT7} ##### Mr McNEILL:
Wannon >I should like to move an amendment to provide that the court shall not include in any award, a provision, requiring a person who claims the benefit of the award to notify his employer that he is a member of the organization which obtained it from the court. When Chief Judge Dethridge made his award in relation to the pastoral industry in 1927 he inserted a provision that station employees should notify their employers that they were members of the organization covered by the award. Such a provision is unjust, and many men employed on stations find it embarrassing to have to notify their employers of their membership of such organizations. In some cases these men have been engaged at lower rates than those prescribed in the new award, and they are put in a very awkward position through having to notify their employers that they are members of the organization which has obtained the award, and therefore entitled to increased wages. {: .speaker-JSC} ##### Mr Brennan: -- I suggest that the honorable member should move his amendment as a new clause. {: .speaker-JT7} ##### Mr McNEILL: -- I shall do so. Clause agreed to. Clause 28- >Section 38c of the principal act is repealed. {: #debate-21-s26 .speaker-KZO} ##### Mr LATHAM:
Kooyong .- Section 38, paragraph c, requires that, in the course of dealing with a dispute, the court shall consider whether it is more desirable that it should be dealt with by a State tribunal. This section was inserted in an endeavour to obtain some degree of coordination between State and Federal tribunals; but the Government takes the view that a dispute shall be dealt with by the court regardless of whether there are State determinations covering the same matter. The proposal to repeal the section is entirely unsound. Clause agreed to. Clause 29- >Section 38d of the principal act is repealed. {: #debate-21-s27 .speaker-KZO} ##### Mr LATHAM:
Kooyong .- The principle underlying this section is that if an organization entitled to the benefit of an award is concerned in a strike, or if its members refuse to accept work on the terms of an award, it is proper for the court to consider whether the award should be suspended or cancelled subject to such conditions as the court thinks proper. Surely, if an organization is not prepared to allow itsmembers to work under the terms of an award, it cannot complain if the award is suspended or cancelled. It is desirable to have this express power in the act in order that there shall be an indication of the view of Parliament that a body which. rejects an award cannot be regarded as entitled to consider any other persons to be bound by its terms. The reply to what I have said will no doubt be that in paragraph *oa* of section 38, there is power to set aside the terms of an award ; but that is an absolute power, and ought to be exercised either absolutely or not at all. It is a rigid provision unsuitable for industrial legislation. In that paragraph there is no indication of the character of the facts which, in the opinion of Parliament, would justify the court in considering whether an award should be set aside. It is useless to suggest that there is any fettering of the discretion of a judge, because it, is left entirely to the discretion of the court to say whether the facts are such as justify the suspension or cancellation asked for. One of the questions which arises is whether there is any interference with the discretion of a judge. On other sections the AttorneyGeneral has said that the Government is opposed to any interference with that discretion. There are several amendments and proposed amendments which raise that question, and I propose to illustrate my remarks on this clause by reference to the principle raised by other amendments. One of the most conspicuous of these amendments is that recently mentioned by the honorable member forWannon **(Mr. McNeill),** which proposes an interference with the discretion of a judge. If the Attorney-General should hereafter accept that amendment it will be quite inconsistent with the arguments that he has addressed to the committee on a number of other clauses. Section 38d does not interfere in any way with the discretion of the judge; he is free to determine whether the facts justify the particular suspension or cancellation asked for. At the same time, it indicates the class of case in which Parliament thinks it proper that the judge should exercise that discretion, and I submit that the principle laid down in the section is sound. {: #debate-21-s28 .speaker-JSC} ##### Mr BRENNAN:
AttorneyGeneral · Batman · ALP -- I contend that the principle contained in section 38d is unsound. In the first place, it expressly sets out penalties for lockouts and strikes in respect to which we have already expressly removed the penalties. It refers to what may be done, in certain circumstances, by any number of members of an organization sufficiently large to form a substantial part of the organization, and it refers to their refusing " to accept employment either at all or in accordance with existing orders or awards ". That part of the section is vague, and difficult of construction. It represents part of the policy of the late Government to extend, not so much the burden of any particular penalties, as to extend the policy of penalizing over a wider area, and have it more thoroughly interwoven in the act. So far as the objects sought to beachieved by the section are practicable and desirable, they are achieved in other parts of the bill as the Government hopes it will be passed into law. For these reasons, we propose to stand by our determination to have this section removed. {: #debate-21-s29 .speaker-KXQ} ##### Mr ARCHDALE PARKHILL:
WARRINGAH, NEW SOUTH WALES · NAT; UAP from 1931 -- I am convinced that the present section is far preferable to the ambiguous proposal contained in paragraph *oa* of section 38. I doubt if I have ever heard from a responsible Minister a more ambiguous statement as to the meaning of a section than thatjust made by the Attorney-General. His words seemed unintelligible. The bill certainly provides for the removal of penalties for strikes and lockouts, but assuming that an award had been given, and a union had declared that its memberswould not work, the men would go on strike. There is in the act another section that says that only unionists may be employed. That means that industry must stand still. The proprietor, although prepared to carry out the terms of the award, will not be permitted to do so by the employment of any but union labour. He may be able to employ non-union labour in the meantime; but so soon as the noble unionists make up their minds that they are tired of walking about the streets and living on air, and say that they are prepared to return to work, they will file in at the gate while the non-unionists will file out; and the proprietor will have no redress. Clearly there are reasons for an appeal to the court. The clause lays it down that one of the powers exercisable by a judge is to set aside an award on ibo terms of an award. The AttorneyGeneral has not stated in clear, unequivocal language, that if unionists persist in refusing to accept an award of the court, the other party to the award can nsk the court to set it aside. If that is what the clause means, the honorable gentleman ought to adhere to the terms of the section that he proposes to delete. From every point of view, its wording is far preferable to that of the clause. Clause agreed to. Clause 30 agreed to. Progress reported. House adjourned at 11.32 p.m.

Cite as: Australia, House of Representatives, Debates, 9 July 1930, viewed 22 October 2017, <>.