29th Parliament · 1st Session
Mr SPEAKER (Hon. J. F. Cope) took the chair at 10 a.m. (Quorum formed)
Mr SPEAKER read prayers.
– Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers:
To the Honourable the Speaker and Members of the House of Representatives assembled. The humble Petition of the undersigned, all being of or above the age of 18 years as follows:-
Your Petitioners oppose and seek the deletion of those provisions of the Family Law Bill 1974 which supplant the existing grounds by the introduction of the sole ground of irretrievable break-down, which remove any consideration of fault, and which will weaken the family unit while causing more widespread injustice because:-
it will not encourage maturity in acceptance of marital and parental obligations and responsibilities.
Your Petitioners, therefore, humbly pray that the House of Representatives in Parliament assembled will make provision accordingly. by Mr Stewart and Mr Keogh.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth:
That marriage is an exclusive lifelong partnership between one woman and one man, which should not be dissolved at the will of one party after 12 months notice nor without a reasonable attempt at reconciliation and
That a husband should normally be responsible for maintaining his wife and children within marriage.
Your petitioners therefore humbly pray that the Family Law Bill 1974 be amended.
To specify three objective tests for irretrievable breakdown, namely
And your petitioners as in duty bound will ever pray. by Mr McMahon, Mr Cadman, Mr Drury, Mr Giles, Mr Jarman, Mr Luchetti, Mr Ruddock and Mr Wallis.
To the honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned citizens of the Commonwealth of Australia by this our humble petition respectfully showeth:
And your petitioners as in duty bound will ever pray. by Mr Hurford.
To the honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth-
That (A) under the provisions of the Family Law Bill-
No encouragement is given to parties to retackle difficulties for the sake of the chief victims of divorcechildren, and
Marriage rights of the party divorced against his or her will be protected by:-
Your petitioners therefore humbly pray that the House will amend the Family Law Bill in accordance with the above provisions.
And your petitioners as in duty bound will ever pray. by Mr Hyde.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned citizens of the Commonwealth of Australia by this our humble petition respectfully showeth:
It is granted that the present law respecting divorce is deficient in some of its provisions, and needs reforming:
Your petitioners consider preservation of the family essential to the healthy function of society, and that every effort should be made to preserve traditional attitudes to marriage and child-bearing.
Certain aspects of the Family Law Bill 1974 conflict with these concepts, and endanger the security, welfare, education and development of children.
We request that the Bill be not enacted in its present form, and that consideration be given to our concerns in formulating amendments thereto.
And your petitioners, as in duty bound, will ever pray: by Mr Lusher.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth:
That there is great urgency to preserve the family as the basic unit in society and therefore the stability of family life requires the urgent attention of Parliament.
Your petitioners therefore humbly pray that: -
And your petitioners as in duty bound will ever pray. by Mr Charles Jones.
To the Honourable the Speaker and Members of the House of Representatives in the Parliament assembled. The humble petition of the undersigned citizens of the Commonwealth of Australia respectfully showeth:
That the Family Law Bill 1974 would be an unjust law if passed since the innocent party could be divorced against his or her will after a year ‘s separation.
That the Bill does not only facilitate divorces but changes the nature of marriage and the husband-wife relationship. Legislation ought to reflect public opinion, not attempt to condition it. Gallup polls indicate 75 per cent of Australians are opposed to the concepts of the Family Law Bill. Therefore Parliament has no mandate from the people to ask such a far reaching change in the nature of our society.
That children need a stable emotional and psychological environment in which to grow up. This stability is upset by divorce. A high proportion or criminals come from broken homes. Consequently any law which makes divorce easier is harmful to society.
Your petitioners therefore humbly pray that the Parliament so vote as to defeat the Family Law Bill.
And your petitioners as in duty bound will ever pray. by Mr Clayton.
To the Honourable the Speaker and Members of the House of Representatives assembed. The humble petition of the undersigned citizens of Australia respectfully showeth:
That we strongly oppose the Family Law Bill in its present form.
That we believe that the Government has no mandate for the radical changes in the Bill, and that there is no obvious demand for them.
That the Bill in its present form will diminish the stability of society and will lead to a society that regards marriage as a temporary association and not a permanent union where children are reared in the love and security of the family.
That we regard the concept of matrimonial fault necessary for the justification of divorce, and for a fair decision on the custody and maintenance of the children.
Therefore we deplore its exclusion from the Bill.
That none of the foregoing is acceptable to us.
Your petitioners therefore humbly pray that the Government will not proceed with the Bill in its present form, but will graciously consider our petition.
And your petitioners as in duty bound will ever pray. by Mr McVeigh.
The humble petition of the undersigned citizens of Australia respectfully showeth:
That the National Compensation Bill 1974 and the proposals for a new Superannuation scheme for Australian Government employees discriminate in the payment of reversionary benefits against the members of families which:
Your petitioners therefore humbly pray that the National Compensation Bill 1974 and the new superannuation scheme for Australian Government employees be amended to provide for the payment of reversionary benefits to dependent members of all families, however constituted.
And your petitioners as in duty bound will ever pray. by Mr Hayden and Mrs Child.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The petition of the undersigned citizens of Australia respectfully showeth:
That the plan to obliterate the traditional weights and measures of this country is causing and will cause widespread inconvenience, confusion, expense and distress.
That there is no certainty that any significant benefits or indeed any benefits at all will follow the use of the new weights and measures.
That the traditional weights and measures are eminently satisfactory.
Your petitioners therefore pray:
That the Metric Conversion Act be repealed, and that the Government take urgent steps to cause the traditional and familiar units to be restored to those areas where the greatest inconvenience and distress are occurring, that is to say, in meteorology, in road distances, in sport,inthebuildingand allied trades, in the printing trade, and in retail trade.
And your petitioners as in duty bound will ever pray. by Mr Beazley and Mr Keith Johnson.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully Showeth:
That the increased price of the Hansard subscription will place it beyond the financial reach of most people.
That it is basic in a Parliamentary democracy that electors have easy access to records of the debates in their Parliament.
That making Hansard available only to an elite who can afford it is at odds with the concept of open government.
Your petitioners therefore humbly pray that the Government will reduce the cost of the Hansard subscription so that it is still available at a moderate price to any interested citizen.
And your petitioners as in duty bound will ever pray. by Mr Drury.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. We the undersigned Citizens of the Commonwealth of Australia by this our humble Petition respectfully showeth:
And that it be noted that Queensland had Divorce by Mutual Consent prior to 1959.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of the undersigned citizens of Australia respectfully showeth:
Your petitioners therefore humbly pray that the House of Representatives in Parliament assembled should not admit into the law of this land the principle that marriage is only temporary and the family no longer the fundamental unit of society.
And your petitioners as in duty bound will ever pray. by Mr Hodges.
– I ask the Prime Minister: Have the procedures concerning security checks and clearances been changed since December 1972? Is the Australian Security Intelligence Organisation still responsible for security checks or are they carried out by the Commonwealth Police? Finally, what role does the Attorney-General have in such matters?
– My answer to the Acting Leader of the Opposition is: No; yes; in accordance with statute.
– Has the Prime Minister’s attention been drawn to the recent announcement that inflation in the United States of America is currently running at 14.8 per cent? Is it also a fact the unemployment in the United States is running at 8.2 per cent? Is it a fact that President Ford has now reversed his economic policies and is now advocating measures similar to those commenced by this Government 4 months ago? In view of the fact that the Leader of the Opposition is the only man in the world who has an answer to the twin economic ills of the worldinflation and unemployment- will the Prime Minister lend him to the Americans for a while?
– I do not propose to respond to the last part of the honourable gentleman’s question. The last time that the Leader of the Opposition visited the United States he got very short shrift indeed. It is true that the figures for inflation and unemployment in the United States are more serious than is the case in Australia. It just accords with the situation which I have stated for some time now, that the twin problems of unemployment and inflation are besetting every country which is like Australia; that is, every industrialised trading country in the world- all of the Organisation for Economic Cooperation and Development countries- are afflicted in the same way.
– That is not so.
-The Acting Leader of the Opposition is enjoying his brief moment of glory and constantly interjects.
– I do not carry on like the archangel Gabriel either.
-To pursue that sort of analogy, he burbles like Beelzebub. The inflationary situation is serious in all of the countries of the OECD. It is serious not only in the United States but also in Canada, Britain, Italy and the rest of the OECD countries. The unemployment position is serious in all of those countries as well. Our unemployment situation is exceeded on a percentage basis by Canada, the United States, Italy, Denmark and Ireland, and it is equalled by West Germany. There is no particular comfort in recognising this situation, but there is no point whatever in seeking to conceal it or to confuse it. The fact is that all that part of the world which resembles Australia is in an extraordinarily difficult economic situation. North America,
Western Europe and Japan all have these twin problems at the same time. At least it ought to be acknowledged that in Australia the general standard of living has improved and the incomes that people receive have risen more than have prices, even accounting for taxation.
-I ask the Minister for Minerals and Energy: Is it true that a very senior officer of his Department was invited to deliver a paper to the Fifth International Symposium on Energy Resources and Environment held in Kuala Lumpur last week? Did that officer refuse to deliver a paper? If so, why? Further, why was no officer of his Department present at that conference and symposium at which the world’s leading experts on energy resources and the environment gave the benefit of their knowledge? Does this indicate that the Minister and his Department believe that their fund of knowledge in this area is complete?
– The facts are quite simple. We are rather short of staff.
Opposition members- Ha, ha!
-Now that the Opposition has had its horse laugh the rest is this: If we had a little co-operation from the Opposition in terms of the application of our policy on which we were elected as a government, I might be able to spare staff for such a purpose. On the other hand, I do take a rather dim view at times of people being sent along to gabfests and on junkets.
– My question is directed to the Prime Minister. Has the Prime Minister’s attention been drawn to the incomplete reports in Western Australia of the Government’s intention to continue with social service benefits as planned? Will the Prime Minister further clarify that situation? Can he give an assurance that the proposed program for stage 2 of the abolition of the means test will proceed as planned next April?
– I have not followed the reports in the West Australian media on this subject. The Minister for Social Security and I made it abundantly plain last week that there would be the usual increases in social service payments and the due reduction in the age limit for the means test this session. That is an undertaking which has been repeated and which has never been questioned. There can be no excuse for distorting or incompletely reporting that repeated undertaking.
– My question is addressed to the Minister for Northern Development and Minister for the Northern Territory. What steps has the Government taken in the past week or what steps does the Government propose to take in the near future to assist the beef industry? Does the Government welcome the Queensland Government’s action in providing $10m to the beef industry at 2V4 per cent interest? In view of the fact that the Queensland Government is itself short of funds, does the Minister believe that the Australian Government should immediately take action to expand the provision of long term, low interest funds? Will the Government suspend the meat export levy which the Minister introduced into this Parliament, increase the availability of finance for reconstruction in the industry and double the income tax averaging limit? With regard to the last three matters, is the Minister aware that 4 months ago the Australian National Cattlemen’s Council, which the Minister is so fond of quoting, suggested such a course of action?
– It is a fact that last week the Queensland Premier announced a $10m cattle industry assistance scheme. But, of course, he did not tell us all the facts. It was announced in such a way as to imply that every cattleman in Queensland who wanted this money would be eligible for it. Nothing could be further from the truth. In fact, there are very rigorous conditions attaching to the scheme that are going to preclude most of the cattlemen in Queensland from benefiting from it. Although loans are to be at 2 per cent, the proposal is really an adjunct to the rural reconstruction scheme and there is still plenty of money available in the rural reconstruction scheme for the cattle industry. The terms and conditions of the Queensland scheme are that it is to be administered through the Rural Reconstruction Board along the lines of the earlier wool growers assistance scheme. An eligible applicant must first have approached the Development Bank and been refused. The loan is for carry-on requirements, including local authority rates, stock assessment fees, land rents and similar commitments, plus debt reconstruction. But the point is that a person has to go to the Development Bank first and be refused. That is what is written down here. Those are the terms and conditions of the Queensland Government’s scheme. Until a person goes to the Development Bank he cannot get this money. (Opposition members interjecting)-
-Order! I warn the honourable member for Darling Downs.
– I rise to a point of order, Mr Speaker. I did not speak at all. Fair go!
-Order! If I have made a mistake I apologise, but whoever it was should take very good care that he does not offend again.
– I accept your apology, Mr Speaker.
– It is a fact, as I said yesterday, that the Austraiian National Cattlemen’s Council applied to the Australian Government in writing for a loan at commercial rates of interest. In its most recent letter it said that it is not critical of the Government’s decision. This is not the case with the Opposition. The fact of the matter is that the money that has been provided by the Queensland Premier is not available to the cattle industry unless the cattlemen have gone first to the Development Bank and been refused funds available from Federal sources. The point is this: It is simply a trick which is going to preclude most of the cattlemen in Queensland.
– Has the Minister representing the Minister for Agriculture seen a report in this morning’s ‘Australian Financial Review’ that the Deputy Leader of the Australian Country Party has said that the Australian National Cattlemen’s Council is not acting politically enough? Does the Government believe that industry groups should act politically or in the interests of the people they represent, without political bias?
-Yesterday in this Parliament members of the Australian Country Party rubbished the Australian National Cattlemen’s Council. The honourable member for Hewson interjected by calling it rubbish. In today’s ‘Australian Financial Review’ the Deputy Leader of the Australian Country Party has continued to rubbish the supreme-
– I rise to a point of order. The honourable member for McMillan would be a better term.
-Mr Speaker, the honourable member for McMillan rubbished the Australian Cattlemen’s Council. The rubbishing of the supreme voice of the cattle industry was, of course, carried on by the Deputy Leader of the Australian Country Party. If one reads this morning’s ‘Australian Financial Review’ one can see it in print.
MrSherry- In black and white.
-That is right, in black and white. The article stated:
The Deputy Country Party Leader and Opposition agriculture spokesman, Mr Sinclair, has in discussions with Council officials criticised its tactics.
He went on to give them a rubbishing. What is the Australian National Cattlemen’s Council? Its members are: the Graziers Association of New South Wales, the United Graziers Association of Queensland, the Graziers Association of Riverina, the Graziers Association of Victoria, the Stock Owners Association of South Australia, the Pastoralists Association of West Darling, the Pastoralists and Graziers Association of Western Australia, the Tasmanian Farmers, Stock Owners and Orchardists Association, the Northern Territory Pastoralist Lessees Association, the Centralian Pastoralists Association and the United Stud Beef Cattle Breeders Association of Australia. These are the organisations that the Deputy Leader of the Country Party, fully supported by members of the Country Party in this place, is rubbishing. The cattle industry has to sit down, as the wool industry found out after the same type of tactics, speak with one voice and put forward constructive proposals.
– How can you say that?
-Because the honourable member and his outfit- stooges- are deliberately stirring up trouble throughout Queensland and dividing the cattle industry in Queensland. The Country Party is dividing the industry all through Queensland. The cattlemen know this now after the disgraceful happening at Yeppoon last Friday. Members of the Country Party will not get too many invitations to cattle protest meetings in Queensland any more because their tactics and strategy are to divide the cattle industry and to cause confusion and disarray in it so that they can blame the Government. Let me assure you, Mr Speaker, that the cattle industry in Queensland is awake to the Country Party now.
– I take a point of order. The Minister seeks to divide the cattle industry and to promote-
-Order! There is no point of order. The Deputy Leader of the Australian Country Party will resume his seat.
-As a matter of fact the man most responsible for causing this disarray in the cattle industry in Queensland is the Deputy
Leader of the Australian Country Party. His performance last week at Yeppoon reported to me by cattlemen is in line-
-Order! The Minister will address the Chair.
-Mr Speaker, the Australian National Cattlemen’s Council last week put proposals to the Government including a review of the financial provisions which they first put forward. This is being considered urgently. The Council expressed the view that it was extremely concerned about the possibility of the spread of brucellosis and bovine tuberculosis. I thoroughly agree with the Council. If there is going to be no turn-off or mustering of cattle this year from many areas there is the risk of spread. It also has asked for a review of the export tax.
– What are you doing about it?
-We received the proposals only last week and we are examining them now. My advice to members of the Country Party would be not to stir up any more trouble in the cattle industry but to get it to speak with one voice and to put forward constructive proposals.
– My question is directed to the Prime Minister and by way of preamble I state that it has been a longstanding convention of the Westminster system of parliamentary government that there be total Cabinet solidarity and Cabinet unanimity on Government policy. Having regard to the honourable gentleman’s frequently expressed commitment to the principles of convention so far as they can affect the operation of the parliamentary system and having regard to his invocation of the name of a former Australian Prime Minister-
-Order! Will the honourable gentleman ask his question?
-I am coming to that, Sir. Is the Prime Minister prepared to give the House an undertaking that on the next occasion one of his Ministers publicly repudiates the convention of Cabinet solidarity, as was done by the Minister for Urban and Regional Development only last week, the honourable gentleman in exercise of that magnificent leadership that he so frequently extols in respect of himself-
-Order! Will the honourable gentleman ask his question and not make a statement. I will ask him to resume his seat if he does not ask his question.
-Will the Prime Minister act to protect the convention of Cabinet solidarity?
– I shall analyse the question.
– My question is directed to the Minister for Defence. There have been many reports in the media recently of allegations concerning training given to servicemen in the use of mustard gas during World War II. I ask the Minister Will he inform the House of the nature and purpose of experiments with mustard gas? When and where were the experiments carried out? How many servicemen were involved? The second part of my question relates to chemical and biological warfare research in Australia. What research units are being used for chemical warfare purposes? What is the reason for such research? Will the Minister indicate whether chemical weapons are being produced or stockpiled in this country?
– In 1943 Cabinet took a decision, at the request of the Defence Committee, to establish a chemical warfare field experimental station at Proserpine in Queensland. It is quite clear that during this period mustard gas was used to train servicemen for defensive action. I understand that some 400 volunteers were used. There have been persistent reports in the media since the end of 1 974 concerning this matter. The Official War History’ published in 1958 devotes a full chapter- chapter 17- to this matter. It outlines the action and the decision of the Cabinet at that time. The Cabinet papers which were released in 1974 and the departmental papers which were made available for public scrutiny in 1973 added nothing to the information that was already available in the official war history.
I come now to the other point which has been raised in the media concerning the rights of those who volunteered during the period referred to. It is quite clear that this is a matter which comes under the jurisdiction of my colleague the Minister for Repatriation and Compensation. Any volunteer who was at Proserpine during that period and suffered a disability as a result of the use of mustard gas and has after-effects would have a prima facie case to have that disability accepted as a war-caused disability under the Repatriation Act. I have asked my Department to ascertain, if it is possible to do so at this stage, the names of servicemen who volunteered at that time. It may not be possible for me to find the names of all those who took part in the experimental exercises at Proserpine between 1943 and 1945. However, repatriation records are usually most thorough. It is clear that the names of servicemen who volunteered to serve at Proserpine during this period would be clearly recorded in repatriation files. So any exservicemen who has been so affected should make an immediate application to the Repatriation Department. At the end of the Second World War the station was closed down and all stocks of mustard gas in Australia were destroyed.
I turn to the last question asked by the honourable member. Australia’s obligations, both nationally and internationally, concerning chemical weapons are derived from the Geneva protocol of 1925 and the biological chemical weapons convention of 1 972. These clearly outlaw the use of toxic chemical agents in war, except in retaliation, and also prohibit the production, development and stockpiling of biological weapons. As a matter of policy the Australian Government has decided, quite properly in my opinion, that the stockpiling, production or even development of chemical agents in this country is strictly prohibited. One final point in relation to this matter-
– Do not hurry.
-As I have been asked by honourable members on the opposite side of the House for a full explanation on this matter following reports which have appeared in the media, I believe that they would want a comprehensive reply to the question, and they are getting it. Finally, I say to the honourable member for Phillip that we adhere strictly to the Geneva protocol and the convention of 1972 in relation to these matters.
– I ask the Prime Minister a question concerning the annual report of the Australian War Memorial which was tabled in the House yesterday. Is he aware that the report lists the Board of Trustees as at 30 June 1974 as comprising 12 gentlemen of whom the Chairman was Mr H. B. S. Gullett, M.C.? Is he aware that the Board’s report describes this gentleman as an infantry non-commissioned officer and officer with long front-line service during World War II in the Middle East, Pacific and European theatres of war and also that the Board acknowledges his distinguished contribution to the War Memorial and his distinguished wartime service? As Mr Gullett was ready, able and willing to continue as Chairman and was not barred by age, why did the Prime Minister have this gallant gentleman sacked?
-It is known that I hesitate to answer questions about individuals at question time but, since several of us know and respect the honourable and gallant gentleman to whom the honourable member for Farrer refers, perhaps I should say that there is no question of anybody being sacked from any of these statutory positions. Under the War Memorial Act the Government has the responsibility of appointing persons to the War Memorial. It is some months ago and I might not have a precise recollection of the circumstances, but I believe there were 2 members of the Board whose terms had expired. One was the former Chief Justice and Lieutenant-Governor of Victoria, Sir Edmund Herring. We nominated to fill the vacancy caused by Sir. Edmund Herring’s retirement Mr Justice Starke, a returned soldier and a member of the Victorian Supreme Court. We wanted to preserve the continuity there.
We appointed to the vacancy caused by the expiry of Mr Gullett ‘s term a gentleman who had had considerable experience at a later period. He had not only covered as a war correspondent the hostilities in Korea, Malaysia and Vietnam but he had also held senior rank. He was commanding officer of a battalion in the Citizen Military Forces and furthermore he had particular skills in many of the fields where it is not generally realised the Australian War Memorial is one of our principal institutions. It is an institution which is a considerable publisher, has a considerable art gallery and has a considerable archives repository. This gentleman has skills in the whole field of the’ media and he had experience in the Citizen Military Forces. He had experience in those campaigns where Australians had been engaged since the end of the Second World War. No continuing or retiring member of the War Memorial had such experience. We believed that the new appointee would bring skills to the War Memorial from which it and the Australian public would benefit.
– Is the Attorney-General aware that a well known consumer group reported concerning the effectiveness of baby nappy sterilisers and that its conclusion was that the complete nappy treatments do not work and are a total waste of money at any price? Will the Minister advise whether the Trade Practices Commissioner will investigate this report?
– I thank the honourable gentleman for the question. His interest in consumer protection matters is well known. I am aware of the report by the Australian Consumers Association and the fact that the Association considers that a large number of products presently on the market dealing with baby nappy disinfectants are next to useless or in some cases possibly even harmful. I am told that at present the Aus- . tralian’ Government Analyst is conducting research into the problem at the request of the Trade Practices Commission. He is investigating the claims of the manufacture of these goods. The Trade Practices Act, as honourable members would know, prohibits a corporation from engaging in trade or commerce or any conduct that is misleading or deceptive. The Trade Practices Act also prohibits the making of false representations about the uses or benefits that goods do not in fact have. It is one of the many achievements of this Government that we now have legislation of this sort. I understand that the Trade Practices Commission is currently investigating this matter with a view to considering possible prosecution or injunction proceedings relating to the supply of the goods. The product may well be a proper subject for consideration in relation to the product safety standard provided by the Trade Practices Act. I am having that aspect of the matter investigated.
-In view of the new-found concern of the Minister for the Northern Territory for the problems of the beef industry and his attempts a few moments ago in this Parliament to denigrate the efforts of Queensland cattlemen to secure from his Government some recognition of their plight I ask: Why was the Minister not at Yeppoon? Why was his apology received less than 24 hours before the staging of the meeting? Does he really believe that cattlemen are better served with the money that his Government has provided at 1 1 1/2 per cent interest than the money the Queensland Government has provided at Vh per cent interest?
-Last week I made it very clear publicly that I would not attend a protest meeting organised by the Country Party- a meeting deliberately staged to divide the cattle industry in Queensland. My apology was accepted. The fact that it was not received more than 24 hours before the meeting is obviously again a plot by the honourable member’s Country Party friends because the invitation was given to me at least a week before and I replied immediately to Mr Hartwig, the Country Party member. That is why I was not present. I know the tactics of the Country Party. Nothing constructive came out of that meeting except the motions moved rationally and sensibly by one of the leading cattlemen in Queensland, Mr Onley.
He put forward a sensible and constructive proposition for the cattlemen to speak with one voice, but the Country Party does not want the cattlemen to do so. It wants them to be completely divided so that they cannot put forward anything with one voice. The Deputy Leader of the Country Party is criticising the Australian National Cattlemen’s Council because it put up -
- Mr Speaker, I rise to a point of order. The Minister is flagrantly denying an answer to the question he was asked. He is avoiding the points that have been raised by the Deputy Leader of the Country Party.
-Order! No point of order is involved.
-The Deputy Leader of the Country Party asked me about the 1 1 !6 per cent rate of interest applying to loans from this Government. I repeat again that this proposal was put to the Government by the Australian National Cattlemen’s Council. Let me now give some information to members of the Country Party. I ask them to listen to this. In a letter dated 13 February- a little over a week ago- from the Australian National Cattlemen’s Council to the Australian Government through the Minister for Agriculture, the following appears:
The Australian Government’s decision to offer loans through the Commonwelath Development Bank was in accord with a request made by this Council. This Council is in no way critical of the manner in which the Bank is administering these loans.
– I address a question to the Minister for Services and Property. What amount is legally expendable under the Electoral Act by a member of the House of Representatives and by a member of the Senate for campaign purposes? Is there any restriction on the amount of campaign funds which may be spent by political parties? If not, is there any way by which this expenditure can be checked or limited?
– The amount of money expendable in an election campaign by a member of the House of Representatives is $500 and by a senator $1000. There is no restriction on the amount of money which parties can spend. Recently the Government sought to make public donations to political parties and also to increase to a reasonable amount expenditure allowed in an election campaign. Evidently there are people in this country who do not want the source of their campaign funds to be known or the amount of money allowed to be spent on an election campaign to be restricted. They do not even want the provisions of the Electoral Act brought up to date in a practical way. The fact that there is no restriction on the amount of money which political parties can spend in an election campaign is exemplified in an article in the ‘National Times’ of 24 February 1975 in these terms:
The Country Party has been making distinctly sympathetic noises to some foreign mining companies which feel they are being squeezed by the new nationalism of the Whitlam Government.
- Mr Speaker, I raise a point of order. I believe that this piece of legislation is currently before another place. The question would therefore be out of order.
-Order! There is no point of order involved.
– The article continues:
No promises are being made but the miners are being told that the attitudes that applied to foreign investment preDecember 1972, might make a comeback under a Country Party influenced coalition government.
In return for this sympathy, the party would undoubtedly be grateful for campaign funds- and a flow of new foreign investment when Doug Anthony is the new Minerals and Energy Minister.
Arising from this, at least one prominent business man with close contacts with the Liberal Party has told Bill Snedden that the post for Doug Anthony in a coalition Cabinet should not be minerals czar but Treasurer.
There, so the theory goes, the opportunity for pork barreling is less because of the financial restraints imposed oil u Treasurer.
This financial journal implies, in effect, that funds are coming into the Country Party so that when the Country Party comes into government it will, for services rendered, be subject to the dictates of those who contributed the funds. It is no wonder that in this Parliament recently the Country Party voted against the proposal to disclose the source of campaign funds; no wonder the Liberal Party joined the Country Party in that stand. It is interesting to note that yesterday the Opposition in this place indicated that it will vote against the Corporations and Securities Industry Bill and that the Opposition in the Senate voted against the proposal to divulge the source of party funds. It is no wonder that honourable members opposite want to hide from the people the source of their campaign funds and want no restriction on the amount of money that is allowed to be spent in an election campaign. Members of the Country Party and the Liberal Party are afraid to reveal the source of their funds. Undoubtedly those funds must be flowing in in great amounts. This is apparent from the fact that in 1973 the Leader of the Opposition said that he would vote for the proposal to divulge the source of campaign funds, and the Leader of the Country Party said that he too would vote for the proposal. Now that the coffers are overflowing with secret funds they’ voted against the proposition in this Parliament the other day and repudiated their intention. The Australian people should know that if and when in the foreseeable future, or the far distant future, honourable members opposite become the government, the new Treasurer will be a man who has taken funds from mining interests but will not reveal them and will be legislating in their interests.
-My question to the Prime Minister follows the question asked of him this morning by my colleague the honourable member for Bennelong. It pertains to the word ‘convention’ which has been much used and abused by the Prime Minister in recent times. By way of preamble I again remind the Parliament that in recent days the Prime Minister has come out very strongly in stating how important it is that conventions be followed. I ask the Prime Minister Has he and his Government not flouted the convention and the law on the following issues: In relation to open government, by his refusal to allow Parliament to know the amount of reduction in government expenditure; by not dismissing Cabinet Ministers for leaks or illegal actions, for example, the raid on the Australian Security Intelligence Organisation; by his refusal to obey the rule of law by releasing national service defaulters contrary to the law; by violating the traditional convention of direct State appeals to the Privy Council -
-Order! Would the honourable gentleman ask his question?
– … by ignoring the convention of sub judice in his uncontrolled outburst immediately after the Hobart disaster? Why did he not resign in accordance with British Cabinet practice after his breach of good manners and conventional practice? In other words, does the Prime Minister agree that people who live in glass houses should refrain from throwing stones?
– I suppose the simple answer to the honourable gentleman is no, in all those cases where he chided me for having broken conventions or manners or however he described it. It is true that I have come out strongly in favour of constitutional conventions. I have been supported in this by the Federal Executive of his
Party. I have been supported by every Liberal Premier in Australia for the last quarter of a century, except the present Premier of New South Wales.
-Sir Henry Bolte?
-Yes, of course Sir Henry Bolte supported me. My predecessor interjects because he knows and respects the constitutional convention in this matter. It was brought about by the intervention of the founder and first leader of the Liberal Party of Australia, Sir Robert Menzies. I was saying that the convention for which I have been coming out strongly has been supported by the Federal Executive of the Liberal Party at the moment, by every Liberal Prime Minister, by every Liberal Premier before the present Premier of New South Wales, by every member of the Liberal Party who served on the Constitutional Review Committee established on motions by Mr Menzies, Mr Holt and Sir Garfield Barwick, and by every member of the Liberal Party who attended the Constitutional Convention, in September 1973 and has served on its committee since then. There can be no doubt about the validity of the convention for which I have come out strongly. I had almost forgotten; I believe that the Leader of the Liberal Party in this Parliament also supports the convention.
-I wish to make a personal explanation.
-Does the honourable gentleman claim to have been misrepresented?
– Yes. During question time the Minister for Northern Development and Minister for the Northern Territory (Dr Patterson) alleged that I, along with other members of the Australian Country Party, was setting about deliberately to divide the cattle industry in Queensland. He knows that to be completely untrue- although, as he did not attend the meeting at which some 800 or more cattle growers from throughout Queensland expressed their concern at the lack of action by his Government, he may not be aware of it. That meeting was a representation of an attempt to unite the cattle industry, not to divide it.
-Order! I remind the honourable gentleman that this is a personal explanation and he can refer only to where he himself has been misrepresented, not to where an organisation has been misrepresented.
– The allegation is that I have been dividing the cattle industry in Queensland.
I am explaining to the House and to you, Sir, that the meeting at Yeppoon, about which the Minister for Northern Development complains, was addressed by me with the objective of saying to those who attended that they should speak with one voice and should not be divided. Had the Minister been there he would have realised that what he stated in this House was completely the reverse of the truth. In fact, the whole objective of the meeting was to try to ensure that the very seriously affected cattlemen throughout Queensland are put in the position of being able to make a united approach to even an unsympathetic government in order to secure some positive action.
- Mr Speaker, I wish to make a personal explanation.
-Does the right honourable gentleman claim to have been misrepresented?
– Yes. I have been misrepresented again by the Prime Minister (Mr Whitlam). Unfortunately that misrepresentation was picked up and commented upon in the editorial of this morning’s ‘Sydney Morning Herald’. I was again misrepresented in that newspaper, although I forgive the ‘Sydney Morning Herald ‘ for it. It is the deliberate policy of the Prime Minister to take words and misuse them. The Prime Minister alleged that I would destroy the national health scheme, the national compensation scheme and the national superannuation scheme. On page 630 of yesterday’s Hansard the Prime Minister said:
The Leader of the Opposition says that he would destroy the Prices Justification Tribunal, Medibank, the national compensation scheme and the national superannuation scheme.
It is time that the Prime Minister spoke correctly and did not misrepresent the situation. The Opposition ‘s attitudes are clear. They are published in ‘The Way Ahead’, which happens to be the most extensive policy document ever put before the Australian people. The policy attitudes of the joint Opposition Parties have been set out. Specifically, we have stated that we will abolish the Prices Justification Tribunal which has done positive economic harm and which union and business leaders unanimously agree has not succeeded. The Government itself has recognised that that is so by reversing its instruction to the Tribunal for a squeeze on profits. Indeed, the Prime Minister indicated to this House that he would write a letter to the Prices Justification Tribunal asking it to change its methods and to allow profits.
-I think the right honourable gentleman is debating the question. I would remind him that the purpose of a personal explanation is to state where he has been personally misrepresented and it should not be concerned with his Party or his policy.
-Yes. It has been alleged that I have said that we would dismantle most of the measures which have been taken by the Labor Party, and that misrepresentation needs to be cleared up. We have stated that we will abolish the Department of the Media which we regard as an unnecessary and interfering propaganda bureaucracy designed ultimately to interfere with the freedom of the media to the benefit of the Labor Party.
– I rise on a point of order, Mr Speaker. The Leader of the Opposition is very clearly transgressing your ruling and debating the issue. If you allow him to go through the entire catalogue of measures, the very great number of measures, taken by this Government and to indicate in each case the Opposition ‘s attitude, that will be a very great enlightenment and benefit to the Australian people who will then see what is for the chopper but at the same time it will take up the remainder of the sitting time today.
-The purposes for which a personal explanation can be made are set out quite explicitly in standing order 64. A personal explanation can be made on a matter in relation to which a person has been personally mis-, represented and should have nothing to do with a party or a policy being misrepresented. It should be concerned with a statement that may have been made about the right honourable gentleman which he claims has misrepresented him personally and should not be concerned with his party policy at all.
– The misrepresentation was made by the Prime Minister. I have quoted the relevant part of Hansard. The Prime Minister’s statement was directed to me. He said that the Leader of the Opposition says that he would destroy certain things. He went on to speak of the Prices Justification Tribunal, Medibank, the national compensation scheme and the national superannuation scheme. He said:
We have this extraordinary situation that in the Senate at the moment the National Compensation Bill is being considered by a committee composed of equal numbers from both sides of the Senate. Now the Leader of the Opposition completely destroys its deliberations.
The ‘Sydney Morning Herald’ picked up the statement made by the Prime Minister and claims that I have said that I would dismantle most of the things that the Labor Party has done., In those circumstances and in accordance with the Standing Orders, I believe that I have a perfect right to explain to the House precisely what I would do, in order to set right the misrepresentations that have occurred.
-It is not a matter of what the Leader of the Opposition would like to do to set the record straight; it is a matter of where he has been misrepresented. The Leader of the Opposition has claimed that what the Prime Minister said is incorrect and he has made his point in relation to that misrepresentation.
– It was incorrect, Mr Speaker.
-The Leader of the Opposition has made his point in saying where he has been misrepresented. The Leader of the Opposition is not entitled to say what he would do to remedy the situation! That would then be to debate the matter.
– All right, Mr Speaker. The Sydney Morning Herald ‘ editorial reads:
He would not, of course,’ be doing his job properly if he failed to press the case for the Opposition’s alternative policies- which might, certainly, include the dismantling of some of Labor’s policies. But to undertake to dismantle most of them is quite another matter.
I am making it clear that that is a misrepresentation. What I have said is exactly what we would do and that does not amount to dismantling most of Labor’s policies. It amounts to dismantling those which are objectionable, unrealistic and improper. We would abolish the Petroleum and Minerals Authority. In every other area the Opposition is committed to the constructive improvement of legislation and Government schemes.. We have supported the principles of the national compensation and national superannuation schemes. What I have said is that we are not prepared to support such principles being implemented in such a way as to achieve massive transfers of funds from the private sector, out of the people’s purse, into the public purse so that the public authorities can then introduce into and control the private sector in any way they wish. It is consistent with all that I have said that we oppose the accumulation of giant funds by government authorities under the national compensation scheme, the national superannuation scheme and Medibank.
-I think that the right honourable gentleman is now going into a debate on the subject matter.
-Mr Speaker, I wish to make a personal explanation.
-Does the right honourable member for Lowe claim to have been misrepresented?
– Yes, I do. You will remember, Sir, that this morning the Prime Minister (Mr Whitiam) said that all his predecessors as Prime Minister had supported his attitude to the convention relating to the filling of casual Senate vacancies. That is totally untrue. I have made my position clear in this House. I do not think that any convention can override section 1 5 of the Constitution, which gives the States the right to determine who the replacement should be when a casual vacancy occurs. I made that clear in a letter I wrote to the ‘Sydney Morning Herald’ on 17 February 1975. I seek leave to incorporate that letter, which is a short one, in Hansard.
-Is leave granted?
– No. We have not seen it.
– May I read it, Sir?
– The letter reads -
-Order! Does it clarify the point on which the right honourable member claims to have been misrepresented?
– Yes, Sir.
-I am only concerned about the point on which the right honourable member has been misrepresented.
– I have been completely misrepresented.
– How many pages does this letter consist of?
- Sir, you have given me the privilege of -
-Mr Speaker, it might shorten things if the right honourable gentleman were to assure me that he does not support the convention which all other Liberals in the Parliament do and all his predecessors did. I would accept his assurance.
– I do not want the Prime Minister to accept my assurance because I never accept his assurances. What I would like to do is to have the letter incorporated in Hansard. If the Prime Minister has any sense of responsibility he would agree to its incorporation because of his continuous misrepresentations. But, if I am to be prevented from doing that and democracy is to be denied, I will get on to the next point. I was also misrepresented by the Prime Minister when, in relation to allegations that the present
Government was trying to borrow Arab oil dollars, he said that he was following my practices because I had argued that I had frequently -
-When was this?
– When was this? This morning?
– No, 2 weeks ago. But, Sir, it sometimes takes a little -
-Oh! This is Rip Van Winkle.
– It might be, but the Prime Minister is completely deceitful and dishonest and I would rather be Rip Van Winkle than completely deceitful.
-Order! I think that the right honourable gentleman would be well advised in the future to ask to make a personal explanation either the day after he is misrepresented by somebody or, if the misrepresentation happens to appear in the Press, the next day and not to bring up such a matter a fortnight later. I would not know what it was all about.
-Sir, I have to get the Press releases and when one has been out of office for a couple of years it is not easy to get all of them. I have had them collected and finally analysed only during the course of the past few days. I would not have attempted a personal explanation if it had not been for the misrepresentation of the Prime Minister today. Therefore, Sir, I must ask for your indulgence to permit of me to put into the Hansard record a Press release which shows that when I was the Treasurer we did make it known that we intended to negotiate for funds.
-I cannot grant the indulgence of the Chair in relation to this matter because the right honourable member did not come to see me prior to question time to explain what it was all about. The right honourable member would have to seek leave of the House in order to clarify this matter. Is leave granted?
-Leave is not granted.
- Sir, then I will take other action in the Press to see that the Prime Minister’s statement can be seen as a complete misrepresentation of what I did.
-I have received a message from the Senate returning the Darwin Reconstruction Bill and acquainting the House that the Senate does not insist upon its amendments disagreed to by the House of Representatives, has agreed to the amendments made by the House in place of Senate ‘s amendments Nos 2,9, 13, 15 and 16, and has agreed to the amendment made by the House to clause 6 1 of the Bill.
Motion (by Mr Daly)- by leave- agreed to:
That so much of the Standing Orders be suspended as would prevent the House discussing a definite matter of public importance proposed to the Speaker by the honourable member for Warringah.
-I have received a letter from the honourable member for Warringah (Mr MacKellar) proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The Government’s inept handling of the case of the Right Honourable John Stonehouse, M.P.
I call upon those members who approve of the proposed discussion to rise in their place. (More than the number of members required by the Standing Orders having risen in their places)
– Before commencing on the matter of public importance I would like to thank the Leader of the House (Mr Daly) for allowing this debate to come forward. The Minister for Labor and Immigration (Mr Clyde Cameron) administers, amongst other Acts, the Migration Act 1958-73. Sub-section ( 1 ) of section 8 of that Act states:
Nothing in this division applies in relation to the entry into Australia of an immigrant being-
And then it goes through paragraphs (a), (b), (c), (d). Paragraph (e) states:
A person who-
is for the time being exempted, by instrument under the hand of the Minister, from the requirements of this Division relating to entry permits; or
is included in a class of persons who are for the time being so exempted, not being a person in respect of whom a declaration is in force under the next succeeding sub-section.
It is important to note the words ‘by instrument under the hand of the Minister’. This is a section which allows the Minister to exercise his judgment in exempting certain classes of people from the need to have valid entry permits when seeking to enter Australia. Parliamentarians from Commonwealth countries are amongst those who may be exempted from the requirement to possess valid entry permits.
The section, I believe, needs closer examination. Firstly, it is not mandatory upon the Minister to allow such exemptions, and thus it would seem to me that any exemption, once permitted, can just as easily be withdrawn. Secondly, I believe the intention of the section is clear. It confers a privilege upon those classes of people mentioned, but it does so, I would submit, only so long as those so privileged freely and openly display their status when seeking to enter the country. In the case of parliamentarians, I believe that the privilege is clearly designed to facilitate their travel and entry to Australia so long as they freely and openly proclaim their parliamentary status. The privilege is reciprocated in other Commonwealth countries. I believe the intention is clear- it is mutually advantageous for Commonwealth parliamentarians to visit each other’s countries. It is certainly implied that the privilege is not predicated on the belief that any Commonwealth parliamentarian will use the privilege to avoid the laws of the land being visited or as a lever to seek citizenship of that land. On the contrary, I believe it is clearly based on the belief that the parliamentarian so privileged will not abuse that privilege and he or she wil merely be a short term visitor to the country being visited unless, of course, previous arrangements have been made.
This brings me to the so called Stonehouse affair. The facts of the case concerning Mr Stonehouse ‘s entry to Australia are well known. They have been canvassed freely in the Press. But I believe they bear repeating. Mr Stonehouse travelled to Australia in November of last year. He travelled not as Mr Stonehouse but as Joseph Arthur Markham. There are 2 main factors involved here. Firstly, Mr Stonehouse did not openly and freely proclaim himself as John Stonehouse, M.P., member of the British House of Commons, when he sought to enter Australia. He travelled under another name. He therefore did not seek the privilege accorded to a visiting Commonwealth parliamentarian. He remained in Australia under the name of Markham and possibly other names until he was arrested by the Victorian Police shortly before Christmas. I have said that he did not come here as a politician. A report in the ‘Sydney Morning Herald’ of 21 January 1975 quotes Mr Stonehouse as saying:
I am not here as a politician -
I ask honourable members to note those words-
I came to escape all the hypocrisies of English politics.
He therefore clearly could not be said to have justified by his behaviour the granting of special privileges due to his position as a member of parliament. He came here as an ordinary visitor and there is a clear argument that he should be treated as an ordinary visitor.
The other factor involved, and clearly a more serious one, is that Mr Stonehouse not only travelled under an assumed name, but also obtained his travel documents and his entry permit by the provision of false information. He assumed the name of a dead man and accordingly entered Australia by presenting false documents to a migration officer. Other people have been in the past, and still are at the present time, deported for this offence as prohibited migrants. The Minister has said that this offence in Mr Stonehouse ‘s case is not important because he, Mr Stonehouse, as a member of parliament did not need an entry permit anyway. To my mind this is hardly rational. Mr Stonehouse clearly did not wish to travel as an M.P. He knew his travel documents were obtained by the provision of false information. Accordingly, he must have known he was breaking the law when he sought entry to Australia by proffering these documents he knew to be falsely obtained. He therefore clearly and consciously abrogated any rights and privileges he could expect as an M.P. Without extenuating circumstances, to seek them later is an act of hypocrisy; to grant them is an act of weakness.
But let us carry the story forward. The Minister having granted Mr Stonehouse his privileges as an M.P., we then find that Mr Stonehouse is using those privileges as a lever to seek the granting of permission for him to stay on in Australia with permanent status. I spoke earlier of the obvious intention of the privileges granted to visiting members of parliament. Just as obviously Mr Stonehouse is abusing that intention. He does not wish to remain a member of Parliament. He has stated so specifically many times. He wishes only to remain in Australia. In the ‘Australian’ on 18 January 1975 Mr Patterson who is Mr Stonehouse ‘s solicitor said:
Mr Stonehouse has repeatedly stated that he has no desire to leave Australia. He wants only to remain here and make a new life and home for himself and his family.
To my mind this shows that Mr Stonehouse knows the Minister will not take action in the absence of a request for extradition from the United Kingdom so long as Mr Stonehouse remains a member of Parliament. He therefore refuses to resign his seat in the House of Commons until his request to be allowed to remain here is acceded to. The ‘Sydney Morning Herald ‘ on 30 January states:
Mr Short read a letter from Mr Stonehouse in which he said that he would co-operate fully with the select committee, even though he did not intend to return to the United Kingdom.
Mr Short is the Leader of the House of Commons. This clearly is an abuse of the privilege extended to Mr Stonehouse as an act of grace by the Commonwealth Parliament. What can be done about this? Much as the Minister would like it, the question is not how the House of Commons should act in relation to one of its own members; the question clearly lies with the Australian Government and its Minister for Labor and Immigration. The entry privilege in Australia is not granted by the British Government; it is granted by the Australian Government. Any decision, therefore, arising out of an abuse of that privilege granted by the Australian Government must be made by the Australian Government. As embarrassing as it might be for the British Government, it is not its role to solve our problems for us.
I ask the House to consider the possibility that some Commonwealth Governments around the world, faced with a similar problem with respect to one of its own members, might refuse to make a decision about the status of one of its own members. This Australian Government and this Minister would, on present performances, take no action and would be shown clearly as being weak and inept. The position is further compounded by the controversy surrounding Mr Stonehouse ‘s financial affairs. It must be said and repeated that British justice requires a man to be presumed innocent until proven guilty.
The Minister is using this argument for not taking any action against Mr Stonehouse. He is quite right to use that argument about .being innocent until proven guilty. In my mind there are no formal charges laid against Mr Stonehouse although I believe writs involving large sums of money have been issued against him. So far as we know, despite his arrest by the Victorian police, Mr Stonehouse has committed no crime in Australia except that offence relating to his entry into the country. This really is immaterial. The fact is that Mr Stonehouse, under an assumed name, did commit an offence against the migration laws. He has shamelessly used his privileges granted by the Minister to avoid the consequences of that offence. Even if Mr Stonehouse was not a member of Parliament the Minister is still empowered to ignore his offence and to grant his request for permanent residency.
The fact remains, however, that very real doubts have been cast on the propriety of Mr Stonehouse ‘s business activities. Two detectives from New Scotland Yard have already visited Australia. A special inquiry has been set up by Mr Stonehouse ‘s colleague in the House of Commons, the present United Kingdom Minister for Trade. This inquiry is proceeding but may take some time to complete. A report in the Melbourne ‘Age’ of 14 February stated that 2 Government appointed inspectors were preparing to fly to Australia to interview runaway British politician John Stonehouse about his business affairs. Four companies are involved- the London Capital Group, which is a second line bank; Global Imex, a trading company; Connoisseurs of Claret, and Export Promotion and Consultancy Services. It is not realistic to suggest that Mr Stonehouse would be subjected to unfair treatment by the legal processes in the United Kingdom. Nor is it realistic to argue that he would be victimised by the United Kingdom authorities. Therefore, a request for permanent residence based on the argument that Mr Stonehouse would be unfairly treated in the United Kingdom is, in my view, plain nonsense.
There remains another factor. It has been widely reported that Mr Stonehouse has been undergoing psychiatric treatment and that this extraordinary behaviour resulted from the stress and tension of public and business life. Mr Stonehouse himself advanced this argument. I have great sympathy for the man if this is the case. However, 2 points arise from it. Firstly, if, as Mr Stonehouse argues, his actions in travelling to Australia in the manner he did were brought about by his psychiatric disturbance, it is clearly not valid to argue that his actions, with respect to his manipulation of his status as a member of Parliament following his discovery in Australia, are similarly explainable. Mr Stonehouse has stated quite clearly that he is using his position as a member of Parliament to stay in Australia whilst awaiting the Minister’s decision. Secondly, if Mr Stonehouse is in need of continuing psychiatric treatment then that treatment surely is available in the United Kingdom.
The Opposition has not raised this issue publicly before. We have believed that the Minister was in a difficult position and, with respect to some aspects of the case, that initially he acted quite correctly. However, time has gone on and more and more evidence has come forward suggesting that Mr Stonehouse will continue to abuse privileges granted to him by the established custom of succeeding Australian governments. Additionally, this Australian Government is presently taking harsh action against visitors from many countries who have overstayed their visitors visas or who have worked in Australia despite signing an agreement not to do so. Understandably, these people and the people of ethnic communities throughout Australia who have witnessed the actions of this Minister against, in many cases, their friends and former countrymen, feel affronted and discriminated against.
Australians everywhere are fed up with the man who is prepared unscrupulously to use a privilege granted to him to seek to gain permanent entry to this country at a time when so many others are being refused. Mr Stonehouse obviously will not go until required to do so. The Minister for Labor and Immigration has the power to enforce that requirement and he should exercise it.
– This is a very serious question we are debating now. It involves the question of parliamentary privilege; it involves questions that touch upon international relations; it involves the whole question of onus of proof. The honourable member for Warringah (Mr MacKellar) was good enough to make the concession that initially I acted correctly. I thank him for that concession.
– I do not support him in that.
– I believe I did act correctly initially. I believe that any sensible decent person would agree with the honourable member for Warringah that I acted correctly initially. I will show, by what I will reveal now, that I have acted correctly ever since. Mr Stonehouse first came into this country in November. He returned again in December. He was not aware, when he first came into the country, that an exemption was given to British parliamentarians. The Press gave him that information.
– You blokes blame the Press for everything.
– I am not blaming the Press. The Press evidently sees it as the duty of the Press to inform people of their rights, to inform people like Mr Stonehouse of the various loopholes that exist in the law that might enable them to make plans to fit in with the loopholes. The honourable member who made the opening address here on 1 5 February said:
I believe the Australian people require an end to this situation one way or the other. If we cannot see any positive action taken by the Minister to bring this about then we will act.
I ask the honourable gentleman to say what action I should take. This man has not committed a crime against Australian law. No charge has been laid against him of having committed a crime against British law.
– He has committed an offence.
-He has committed an offence against the law of Britain in that he obtained a passport by false or fraudulent means. The British Government has the right to take action against him under 2 Acts of the United Kingdom Parliament. One is the Criminal Law Act and the other is the Forgery Act. Any offence under the Criminal Law Act of Britain does not become an extraditable offence even if proven but it does become an extraditable offence if a person is convicted of an offence under the Forgery Act of the United Kingdom.
The United Kingdom Government is faced with the dilemma that since the Forgery Act was first put on to the statute book the Act has never been used in respect of this kind of offence. This kind of offence normally would be dealt with only under the Criminal Law Act of the United Kingdom and that would not help to obtain extradition. The British Government has been told by Mr Justice Murphy, as he now is, that the Australian Government will co-operate fully with the British Govenment in extradition proceedings, even to the point that contrary to general tradition if a first application for extradition failed the Australian Government would not raise any veto against a subsequent application or applications. This is in spite of the fact that only very recently the British Government did raise a veto against an Australian application for extradition following a first unsuccessful application. Notwithstanding that, the British Government has been told that the Australian Government will not raise any veto against any number of applications for extradition. I have since talked with the new Attorney-General (Mr Enderby) on the matter and he has reaffirmed the decision taken by his predecessor, the then Senator Murphy.
I spoke to the High Commissioner for the United Kingdom, Sir Morrice James, about this matter. I wanted to know whether there was any truth in reports stating that the British Government would begin extradition proceedings against Mr Stonehouse unless the Australian Government first took action to deport him. Sir Morrice told me that according to the information available to him there was no truth in these reports. I then told Sir Morrice that the Australian Government would co-operate fully with any request it received from the British Government. It is true that under section 8 of the Migration Act all members of Commonwealth Parliaments have immunity from the provisions of the Act in respect of having to produce an entry permit. It is also true that the British House of Commons has not for many years expelled a member except where the member has committed an offence which attracts a penalty of 6 months imprisonment. Mr Stonehouse therefore cannot be expelled on that ground either. Again it was the Press that was able to tell Mr Stonehouse about this loophole, as it turned out to be. At the very time when Mr Stonehouse had made up his mind to resign from the House of Commons it was the Press that was able to inform him that it was highly unlikely that the House of Commons would have the power, or if it had the power would exercise the power, to expel him.
It so happened that it was on 15 January 1975, a long time ago now- I again, unfortunately, have to reveal this and it will help Mr Stonehouse to know it, but it would not have had to be revealed today if it were not for the action taken by the Opposition in this matter; however I am not going to be made by my silence to appear to be hiding something or to be sheltering Mr Stonehouse when I am not- that directions, and I can now say this in my own defence, were issued to my Department that immediately Mr Stonehouse ceased to be a member of Parliament he was to be given 3 days to get out of the country voluntarily and if he did not leave the country within 72 hours of his ceasing to be a member of Parliament he would be deported. That is the instruction. That is on the file of my Department.
– Issued by you?
-Issued by me. That is something I did not want to have to disclose, but I have a choice now of either not disclosing it and proving that I am not doing what it has been suggested I am doing- that is, sheltering Mr Stonehouse and preparing to give him permanent residence here- or revealing the fact.
– It is open government.
-It is open government; fair enough. But Mr Stonehouse now knows that once he ceases to be a member of Parliament he has to get out of this country. He now knows, as a result of this debate, that he has to make plans accordingly. He now knows that since that is the option that he has he cannot afford to wait any longer than that time. I was hoping that I would not have to tell him this until he ceased to be member of Parliament; but he now knows, as a consequence of this debate.
Mention has been made about his having attended a psychiatrist and the suggestion, I think, is heavily weighted along the line that this is just a farce and is being put forward only to try to gain public sympathy. Therefore I have to divulge the following report from the records in this file from the Commonwealth Department of Health, which I did not want to do:
The detailed psychiatric report on the above patient by Mr G. N. Gibney has been studied. It is considered that this man has had a mental breakdown which has resulted in a depressed and paranoic state of mind. The breakdown is due to him overloading himself with responsibility beyond his capability to handle in his political and business life. To this has been added the extra strain of things beyond his control going wrong. One result of this illness has been certain irresponsible acts without proper heed of the consequences in order to try to escape from his troubles. At no time is it considered he was sick enough to come under section 16 of the Migration Act. However, his mental illness is such that he fails to satisfy medical criteria for permanent residence and rejection is accordingly recommended. The prognosis with treatment is considered to be good and he would tackle less responsible work efficiently.
That report was dated 29 January- 14 days after I had decided that he would not be permitted to stay here anyhow. So it is not just some trick on the part of Stonehouse of pretending, as has now been suggested, that he is sick when he is not sick at all.
Something was said about why I did not take action against Stonehouse under section 27 of the Migration Act for having produced to an officer for the purpose of securing entry .into Australia a passport which was obtained by false representation. A conviction under this section would not automatically render Stonehouse liable to deportation if he was otherwise legally in Australia as a member of a Commonwealth Parliament as he is. It would, however, provide grounds on which action could be taken. Other notable cases involving the same offence include that of Mrs Charmaine Biggs, the wife of Ronald Biggs, who was not prosecuted and was allowed to remain in Australia by, I think, the honourable gentleman who will follow me in this discussion, the honourable member for Barker. Another case was that of Thomas Charles Utter who was not prosecuted by me but was deported by me as a prohibited immigrant. That will be the fate of Mr Stonehouse, M.P. once he ceases to be Mr Stonehouse, M.P., unless he leaves voluntarily. Utter had a very serious criminal record; Mrs Biggs did not. The optimum time for instituting proceedings has already passed. I am sorry, it was the Deputy Leader of the Opposition (Mr Lynch), who took the decision about Mrs Biggs. I am indebted to the honourable gentleman’s efficient former secretary for correcting me. It was not the honourable member for Barker. That is good. I like to have the record straight. It was
Mr Lynch who let Mrs Biggs, the wife of the train robber, stay here.
The optimum time for instituting proceedings has already passed but in principle action would still be possible. If action were instituted Stonehouse would probably be granted bail after a preliminary hearing and this might encourage him to leave the country surreptitiously and to disappear. He will probably try to do that now that he knows as a consequence of this debate that on 15 January I gave the instruction that he would be deported if he did not leave voluntarily within 72 hours. Of course I can make a declaration under section 8 of the Migration Act that it is undesirable that he be permitted to remain in Australia. Such a declaration which can be made by the Minister or an authorised officer would cancel the exemption that he now enjoys as a member of Parliament from having to have an entry permit and he would become a prohibited immigrant.
Mr DEPUTY SPEAKER (Mr Martin)Order! The Minister’s time has expired.
-The Minister for Labor and Immigration (Mr Clyde Cameron) has followed his usual line of appearing to be a reasonable individual. He has cited what he alleges to. be the law. He has covered himself and protected his own personal political position by what I would call a dubious practice for a Minister in quoting some instruction which he has given to his Department and which may well result in a miscarriage of the intention which he purported to have or which he suggested was his intention when he gave the instruction. That is typical of the Minister. All through his political career he has been interested only in saving his own skin and protecting himself rather than the interests of the Australian people and the Australian taxpayers. That is what he has been doing since he became responsible for immigration, in dismantling a lot of the worst excesses of his predecessor, Mr Grassby. In fact it is well known that the Minister has told many people that on no account will he be held responsible for a lot of the things which Grassby did, like the consequences of the easy visa scheme.
– I do not blame him.
-I do not blame him in that case. I disagreed with a lot that Mr Grassby did. For once the Minister is right, I believe, in dismantling some of the excesses of Mr Grassby, such as the easy visa scheme. But it is consistent with his action in this case that he should not care a damn about his own Government or the Australian public. He is just trying to protect his own personal political position. This is characteristic of the Minister in relation to almost everything he does. I am not prepared to give him credence for what he has been saying. I do not believe a lot of what he says. I never believe the honourable gentleman. If there is anybody in this House who is an archetype of the cynical politician it is the present Minister for Labor and Immigration. I believe that he has no basic convictions. He is interested only in power and the survival of himself and his own Government
– I rise on a point of order, Mr Deputy Speaker. It is most unparliamentary for the honourable member to be casting aspersions on my character, my motives and my honour. I ask that he withdraw those cruel remarks.
– In reference to the point of order, the honourable gentleman has spent his whole parliamentary career casting aspersions on the motives, character and everything else of other people.
-I am sure that the honourable member for Barker will not transgress the Standing Orders.
-Thank you, Mr Deputy Speaker. If what I was saying” were not correct, how else could one explain the Minister’s statement that he would resign if 200 000 people became unemployed in Australia?
– I did not say that.
-It was 250 000.
-A11 right, 250 000. It does not make any difference. He has not resigned. He is just a cynical politician without any conviction.
-Order! I do not think this matter is relevant to the subject under discussion.
- Mr Deputy Speaker, I cannot let go a second time these cruel innuendoes about me, about my being cynical.
-Did you say you would resign if 250 000 people became unemployed?
-Order! This is not the matter under discussion.
– Are you talking about seasonally adjusted figures or raw figures?
– It is typical of the Minister to suggest that he made qualifications to his statement. This is why my remarks are relevant to this case. The Minister was making all sorts of qualifications and innuendoes in his explanation of his failure to act in the Stonehouse case. I have always thought that for a person with his record of bungling and incompetence in the Labor portfolio to be given the immigrationportfoliowas absolutely astonishing. I do not know why the Prime Minister (Mr Whitlam) did it, but he did it. It was little short of a scandal because there is no portfolio- I know this from experience- in which it is more important that there should be sound and even-handed administration.
Of course the Minister has again plunged in with cynical expediency. He has debarred a perfectly innocent South African cricket official for thoroughly cynical party political purposes. I understand that he intends to permit the entry into Australia of a group of Palestine Liberation Organisation terrorists. He probably supports this action because he was instructed to do so by the Terrigal conference, and he keeps out a perfectlydecentnonpoliticalSouthAfricancricket administrator. As I said earlier about the only thing he has done has been to dismantle the whole Grassby edifice, particularly the easy visa scheme. But he has done that for the most cynical possible purposes.
-Order! I draw the attention of the honourable member for Barker to the terms of the discussions.
– Yes, Mr Deputy Speaker, but these remarks are relevant to this case because they make absolutely clear that in this discussion of a matter of public importance we are saying that the Minister has behaved improperly. This is to be expected of him because of his character and his actions throughout his political career, including his ministerial career. This case has attracted a great deal of public interest. I find that many people are outraged that a person who has done something for which, if he had been a private citizen, he would have been summarily ejected from Australia- the Minister knows this and has admitted it- is allowed to remain here simply because he is a member of parliament. I agree with the people who are outraged.
I believe that a more sensitive Minister than the present Minister and a less cynical Minister than the present Minister would have exercised the undoubted powers he has under section 8 of the Migration Act to withdraw the dispensation he gave in writing under his hand because this man had violated the terms on which it was given. Does the Minister really imagine that if he started to crawl up the cliffs of Dover- it being known that he was crawling up them under a false name and with false documents in his pocket- and when he got to the top he said to the people gathered there: ‘I am a member of Parliament. I am Clydie Cameron- 23 years a member of the Australian Parliament’, the British authorities would permit him to stay? He would not even get to the top of the cliffs. He would be given the boot and would descend on his backside down the cliffs. That would be done by a socialist government, let alone a conservative government. I agree with an earlier unanswered interjection from one of my colleagues. It was most relevant. What has happened here would not have happened if this bloke had been a Conservative.
Mr DEPUTY SPEAKER (Mr Martin)Order! The honourable member’s time has expired.
Mr CLYDE CAMERON (HindmarshMinister for Labor and Immigration)- Mr Deputy Speaker, I wish to make a personal explanation.
-Order! Does the Minister claim to have been misrepresented?
– Yes. This matter of public importance is not directed at any alleged impropriety on my part. It does not suggest that I have acted improperly. That is not the subject matter of this debate. Another comment of the honourable member for Barker (Dr Forbes) which I think was most unfair and most unkind was his suggestion that I would be cynical about these things.
-When this matter of public importance was raised by the honourable member for Warringah (Mr MacKellar) my impression was that the action was both insensitive and irresponsible. Having listened to the honourable member for Barker (Dr Forbes) one can only gain the impression that the whole episode is a farce. He was more concerned about whether some South African cricketer should be allowed into Australia than he was about any matter of public importance concerning Mr Stonehouse. I believe that this House would have the view that the Minister for Labor and Immigration (Mr Clyde Cameron) has acted with every propriety and with good sense in respect of this matter. It is all right for the honourable member for Barker to say that if Mr Stonehouse were a private citizen he would be thrown out of Australia but that that has not happened only because he is a member of parliament. Surely he realises and must assume that there is good reason for the provisions of the Migration Act- that there is a strong case to be made out for having an open door as it were for the people’s representatives of the various member countries of the British Commonwealth of Nations. Does he want to establish artificial barriers? Does he want to create a situation where even these limited absolute terms are destroyed or reduced? Surely we do not throw out the baby with the bath water in a case like this.
I for one am getting tired of people in this Parliament subjecting other perrons outside the Parliament to a trial by gossip, rumour and innuendo. I believe that in this particular case the issue surely must turn on whether Mr Stonehouse has committed any criminal offence. It is not for us to judge that matter. Heaven forbid that this Parliament would assume the responsibility of determining whether private citizens are guilty or innocent of an alleged offence. Very competent tribunals have been established in the United Kingdom and in Australia to deal with these matters. If a charge is to be made, let it be made and if Mr Stonehouse is convicted let appropriate action follow. But until such time as he is convicted we are entitled- in fact we are obliged- to assume that he is innocent of any charge.
– I specifically stated that.
– Yes, the honourable member did specifically state that. He said he supported that concept but then he, and particularly his colleague the honourable member for Barker, launched a personal attack on the Minister for Labor and Immigration for not having done something to remove Mr Stonehouse from Australia. In other words the honourable member argues that the man is innocent until he is proven guilty but then wishes to apply the penalty before -
- Mr Deputy Speaker, I rise to a point of order. The honourable member for Phillip has said that I have assumed that a criminal offence has been committed by Mr Stonehouse. I have not done so. My comments related to his offence in seeking entry to Australia under a false document.
Mr DEPUTY SPEAKER (Mr MartinOrder! That is not a point of order it is a matter of debate.
– I have no wish to do the same thing as I am accusing the Opposition of doing. I have no wish to misrepresent the honourable member. I am saying that the honourable member assumes the innocence of Mr Stonehouse. He admits that no criminal charge has been proven against him. But then he criticises the Minister for Labor and Immigration for not having taken action to remove Mr
Stonehouse from Australia when such action can be based only on the premise that Mr Stonehouse has committed some offence. That is the inference I got from what the honourable member said. I think it a reasonable impression that I have obtained. As we have seen over the years, there are 2 ways of administering the immigration laws. There is the tough, ruthless and cynical way, by saying: ‘We are going to apply our administration in accordance with the very letter of the law without giving any effect to the spirit of the Migration Act’, or it can be applied with some degree of kindness and understanding. I believe the Minister is applying it in the latter manner. Mr Stonehouse may be guilty of an offence. I have no knowledge of that. He may be guilty of all sorts of offences. None of us knows and surely we ought to wait to find out. It is not for us to determine what action the House of Commons will take in this matter. That is a matter for it. When it does take action the Minister can act in accordance with its decision. The Minister has made it clear that no crime against Australian law has been committed by Mr Stonehouse. He has committed no criminal offence against this community. No criminal charge has been laid against him under British laws. I think it the height of irresponsibility for these issues to be raised in this Parliament. This can serve only to prejudice the rights of citizens outside the Parliament.
I am sure that had the honourable member for Warringah or the honourable member for Barker sought information concerning this matter in a sincere and genuine manner or for a sincere and genuine purpose that information would have been forthcoming privately from the Minister for Labor and Immigration. However they did not make inquiry on that basis. They sought to come into this Parliament to try to score some fairly cheap political points, in my view, about the conduct of the Minister for Labor and Immigration in respect of what is a sensational matter. I do not believe members of Parliament really give effect to the trust which is placed in them when they carry on in this way.
I return to some of the arguments put forward by the honourable member for Barker, not that much of what he said deserves answer. He is drawing a very long bow and is basing his argument on false premises when he attempts to draw an analogy between allowing a member of a parliament of the British Commonwealth having a complete and unrestricted right to come into Australia against the decision of the Australian Government not to grant a visa to representatives of the Palestine Liberation Organisation or the South African Cricket Association. The South African cricket official has been refused a visa in accordance with the decisions of the United Nations Organisation and the International cricket authorities, and those who have looked at the question with more than a superficial glance would understand that to be true. The Government is correct in its attitude, and all reasonable people would believe that. The honourable member of Barker has tried to compare the situation of refusing members of the Palestinian Liberation Organisation a visa to enter Australia- I certainly make no apology for that; it was a very correct decision- and of refusing an official of the South African Cricket Association a visa to come to Australia with the situation with regard to Mr Stonehouse. He said: ‘But you let Mr Stonehouse in’. Mr Stonehouse is here as a matter of right, and until such time as he resigns from the House of Commons or is convicted of some criminal offence, he has a right to stay.
Unfortunately this morning the Minister for Labor and Immigration was forced to make a public disclosure that Mr Stonehouse will be required to remove himself within 3 days or suffer the consequences of his having been expelled or having resigned from the House of Commons. I believe, as I said previously, that this is an insensitive and irresponsible action, if ever there was one. I believe that the speech of the honourable member for Barker was a disgrace. He launched a vicious, personal attack on the Minister for Labor and Immigration. It was completely unjustified. He did not refer, except in passing, to the matter under discussion. I believe that the matter should not be treated seriously by this Parliament. I think that the Minister’s actions are beyond reproach, that the Minister has shown himself to be one who has applied the immigration laws with understanding and tolerance, and that above all he has maintained the convention and upheld the law in respect of the rights of members of Parliament of the British Commonwealth of Nations to visit Australia with impunity.
Mr DEPUTY SPEAKER (Mr Martin)Order! The discussion has concluded.
Bill received from the Senate, and read a first time.
Motion (by Mr Daly)- by leave- agreed to:
That the second reading be made an order of the day for a later hour this day.
Bill presented by Mr Enderby, and read a first time.
That the Bill be now read a second time.
The main purpose of this Bill is to amend the Trade Practices Act 1974 to prohibit the sending of unsolicited credit cards. The Bill also provides for amendments to section 5 1 , to adjust the scope of operation of certain exceptions to the Act, and sections 62 and 63, to allow promulgation of consumer product safety and information standards which do not apply to the export trade.
Credit cards are a part- in many respects a desirable part- of everyday life for many Australians. A great deal of business is transacted on credit and credit cards are undoubtedly a convenient means of obtaining credit. If credit cards are furnished only to persons who have sought them, there is in general no cause of complaint. This Bill will have no application in those circumstances. Last year a vast number of credit cards were sent out to persons who had not sought them. That was not desirable. The Standing Committee of Attorneys-General last October expressed particular concern about the matter. The Bill will accordingly prohibit for the future the sending out of such cards on an unsolicited basis.
The Trade Practices Act already contains provisions with respect to unsolicited goods, but those provisions are not appropriate for credit cards, the special nature of which, when sent out unsolicited, gives rise to special objections. When credit cards are sent out unsolicited, they can, and often do, find their way into the hands of the wrong persons. They then become a means by which unscrupulous persons can perpetrate frauds- a means by which such persons may obtain goods and services to which they are not entitled. The cards then become a menace to the business community and to the persons who are put to considerable trouble and expense in establishing that they are not liable for goods or services obtained on the faith of cards issued to them. I refer to goods or services supplied in their name but never received by them. Many cases of this kind occurred last year when the mass distribution of unsolicited bank cards took place.
Apart from the risk of credit cards getting into wrong hands, there are other objections to their being sent out unsolicited. A person who receives an unsolicited card that has been issued to him is confronted with a problem as to what he should do with it. Many such persons have little knowledge of the law and they are placed in a position of some anxiety as to what steps they must take to ensure that they incur no unintended liability. There are also reasons, from a privacy point of view, why credit ratings of persons who have not sought them should not be made and recorded, for example, in a computer to which many other persons could well have access.
A credit arrangement is a personal matter between the person providing the credit and the person receiving it. It should remain that way and should not be rendered impersonal by credit , cards that are sent out without any request. Although it is a matter of opinion that is not the subject of general agreement, it is, or has been, claimed that the mass distribution of unsolicited credit cards can create undesirable inflationary influences. Persons who have not sought credit find it readily available and are encouraged to use it- with a consequential increase in the demand for goods and services. Other countries, notably the United States of America and the United Kingdom, have taken a similar approach to the matter and have banned unsolicited cards.
I turn briefly to the other amendments proposed by this Bill. Section 5 1 of the Trade Practices Act provides certain exceptions to the prohibitions of the restrictive trade practices provisions of the Act. A question has arisen, however, whether a contract excepted by the section may nevertheless be rendered unenforceable by section 45. Such a result was plainly never intended and the Bill makes it clear that an excepted contract is enforceable.
Sections 62 and 63 of the Act authorise the making of regulations to prescribe consumer product safety and information standards. These standards seek to ensure that goods which can be unsafe or hazardous in the hands of consumers are either not supplied to consumers, or are supplied to them with adequate warning of potential dangers. As the Act now stands, a standard must always apply to Australia’s export trade as well as to domestic trade.
The amendments proposed in the Bill enable the regulations prescribing such standards to exclude from their operation goods intended for use outside Australia. In such situations, the Government believes that the standards of the country to which the goods are to be sent should apply, not the standards of Australia. Many other countries of the world set standards with which consumer goods sold in their countries must comply. Although there is some uniformity of approach between countries in these matters, one must expect some differences to arise. These amendments would permit regulations promulgating standards to be made inapplicable to exported goods, so that Australian exporters are not faced with the problem of compliance with incompatible standards. The amendments would also help to prevent inconsistency arising with standards set pursuant to Australian Exports Regulations. Mr Speaker, I commend this Bill to the House.
Debate (on motion by Mr Street) adjourned.
Debate resumed from 25 February on motion by Mr Enderby:
That the Bill be now read a second time.
Upon which Mr Lynch had moved by way of amendment:
That all the words after ‘That’ be omitted with a view to substituting the following words: ‘while strongly supporting the creation of a national regulatory authority to supervise the functioning of the securities industry with a view to increasing efficiency and avoiding abuses in that industry, the House ( 1 ) deplores the failure of the Government to consider the views of the States, company organisations and the securities industry and the decision to force the Bill through the House contrary to previous assurances, and (2) is of the opinion that the BUI:
will not permit the speedy and effective prevention of malpractices within the securities industry;
will involve confusion, increased costs and the creation of a massive administrative bureaucracy;
will not lead to an improved functioning of Australia’s securities markets necessary to increase real capital formation and to allocate resources efficiently among competing demands for capital, and
relies too heavily on discretionary powers, rules and regulations and denies effective rights of appeal ‘.
-Mr Deputy Speaker, you will remember that shortly before the debate on this Bill was interrupted last night, I was dealing with this Bill in considerable detail. I had mentioned the fact that I believed that the old principle of acting in haste and repenting at leisure would be found to be accurate in regard to this Bill. I was able to give some background on why I believed that the Bill should be withdrawn and replaced by something different. Mainly because I felt that the Bill was too technical, was far too detailed and lacked flexibility, and because the Government had shown that it was completely incapable of managing the economy, I came to the conclusion that if the Government was so incompetent it should not be given any further powers. I went on to deal with the reasons why I felt that should not be done and this Bill not passed. I do not believe that one can mix up corporations and exchanges together. This Bill cannot be amended satisfactorily because at least 100 to 150 amendments would be necessary. Of critical importance is the fact that, although some of the concepts and principles of the Bill must be incorporated in the law at some stage, the law cannot be made so detailed and so difficult to administer that those who are attempting to run commercial activities will not be able to act unless they have a lawyer, an actuary and some other person beside them to tell them whether they may take action. In most cases the answer will be no.
I went on to say that I would not be prepared to give the Attorney-General the powers that he proposes should be given under the Bill. I also dealt with the difficult position associated with divisions 3 and 4 in Part V of the Bill. I wanted it to be made absolutely clear that some of the concepts of the Bill, such as those relating to dealings as principal on the stock exchange, wash transactions and similar matters, were concepts which I approve but I do not believe that anyone in the House knows enough about it at the present time to be able to say; ‘whilst we agree with the concept, we also agree with the manner and detail in which these concepts are being put on the statute book’. As I said, it would make the working of this Bill absolutely intolerable and impossible.
I believe it is fair to comment here and now on the feelings and views of a man who was claimed to be the inspirational genius of the Bill before us. Not only the Attorney-General (Mr Enderby) but also, if I remember accurately, the honourable member for Macarthur (Mr Kerin) claimed that Senator Rae would fully endorse this Bill. They claimed that many of the changes to existing law and practices proposed by the Bill were recommended by him or based on his report and recommendations. Let us test that claim against what Senator Rae said yesterday, not in a debate but with reference to the Bill. He said that it is full of inconsistencies, illogicalities, impracticalities and potential injustices. There cannot be any more damning indictment of a proposal or a proposed Bill than that. Like every other speaker on this side of the House whom I have heard, I believe that the criticisms made here are so damning, as are some of the comments made by members of the Government, that the proper course of action is to withdraw this Bill, have another go, then let us on this side of the House examine the proposals and let democracy work in this country.
I come now to clause 61 of the Bill. I had just about reached that point last night when the question for the adjournment of the House was proposed. There is provision under that clause for the Governor-General to prohibit all trading of securities or of securities included in a class of securities during such period as is specified. In other words, the operation of the exchanges may be suspended without notice and immediately and indefinitely. There are incalculable implications and great dangers in that power. I prefer that it be deleted. If that is not practicable, the purpose could be effected by affirmative resolution of both Houses of this Parliament. Can any democrat object to that kind of procedure? Do we believe in democracy or do we believe in an agency of government being able to run riot, to disturb the economy and to disturb the free workings of a market economy?
The powers conferred are altogether too wide and could be subject to arbitrary or irrational decisions. Surely by now we have had enough of that under the Australian Labor Party Government. I mentioned earlier the actions of the former Attorney-General with regard to the Australian Security Intelligence Organisation and other similar types of activities. Opportunity should be given for public debate and parliamentary approval before action is finalised. It can be seen by parity of reasoning that much the same applies in the case of clause 283 which empowers the Commission to make statutory rules in relation to ‘any matter in respect of which the Commission is permitted by subsection 59(3) to make rules’. That is in cases, where a stock exchange is required by a notice to implement a change in any of the constituent documents of the stock exchange.
All honourable members will be aware how difficult it is to get action in the Parliament after the event in cases where regulations are made and there is an attempt either in the House or in the Senate to amend them. Therefore I strongly recommend that, so far as most of these problems are concerned, either the law should be made by affirmative resolution, or by a Bill, or in relevant cases a decision before becoming operative ought to be the subject of an appeal to administrative tribunals such as the Taxation Board of Review or the Industrial Court in the case of arbitration decisions. As I have said, I do not think that the Bill can be amended satisfactorily. I do not think that it can work in practice. I agree exactly with what Senator Rae has said. Consequently I believe that if the Attorney-General has the authority and the influence and the interests of the country at heart he will withdraw the Bill and put up something acceptable to us and, above all, something that will work in the interests of this country and particularly in the interests of the investor.
Mr DEPUTY SPEAKER (Mr Martin)Order! The right honourable gentleman’s time has expired.
– I have waited in vain in this debate to try to understand what the Liberal-Country Party Opposition really wants. What is its approach to this Bill? It is one thing to nit pick and to suggest individual changes to various clauses of the Bill, but it is another thing to tell this House in a second reading debate whether the Opposition wants a Corporations and Exchange Commission such as the one proposed in this BUI. The fact is that the philosophy of honourable members opposite puts them into a tremendous dilemma. They are on record in many different places as paying lip service to the idea that they want a national companies Act and a national securities Act, but when it comes to the point of putting that into effect they go to water. Opposition members want to pretend that they will take the part of the small investor when there is a boom and the stock exchanges are going mad; but when it comes to actually deciding how that is to be achieved they listen to the voices of vested interests and they go to water. There is no other way of explaining it.
There is a perfect analogy to this in the restrictive trade practices legislation. There is one small difference: At the time that concept was brought by them into this Parliament when they were in power they had a man of principle in Sir Garfield Barwick to do so. But then, of course, they mutilated the ideas that he brought to the Parliament so that the eventual legislation, amended time and again, meant nothing. Then a reform Government took over in this country and we achieved a Trade Practices Act which meant something. On this occasion they enjoy being in Opposition where they do not have to commit themselves as to just what their line will be. They can merely criticise the stand that has been taken. They want the Bill withdrawn. Like those opposing the Family Law Bill, they want it withdrawn. That is just an easy way of saying that they do not want to commit themselves to any sort of legislation such as this or to any reforms. Anybody would think that this issue had not been before the nation and had not been considered for years by all the people who are interested in this field. Of course it has been. I turn to the work of the Institute of Chartered
Accountants of Australia, of which I am a member. I would like to read from an article which appeared in the ‘Australian Financial Review’ as long ago as April 1970. The article reads:
The Institute of Chartered Accountants in Australia warns against duplication of State control of companies in a federal body.
That is the essence of what the Opposition is getting at in relation to this Bill. Opposition members cannot pretend to be State righters and at the same time advocate the introduction of effective legislation in this field. They still pretend that a uniform Companies Act will work. The article continues:
An editorial in the Institute’s official journal ‘The Chartered Accountant in Australia’ says that the States have the power and the responsibility for the control of companies.
If events show that proper control cannot be exercised at State level, then surely the remedy does not lie in the setting up of a duplicate Commonwealth Administration’, the editorial said.
It would seem obvious that the better course would be for the States to relinquish their powers and let control of companies be solely a Commonwealth matter’.
A similar comment was made by the Institute of Chartered Secretaries and Administrators. In this case I do not have to go back quite so far, only to July-August 1972. The editorial in that issue of The Chartered Secretary’ is headed ‘Need for a Commonwealth Companies Act’ and reads:
Just a decade ago uniform company legislation was attempted in Australia, a concept which relied upon continuous co-operation between all seven Governments and unaninimity of amendments considered necessary. The tenth anniversary -
The article was written back in 1 972- finds us with a ragged state of affairs. Amendments have varied in the State Acts and Territory Ordinances, both as to content and date of introduction. Some Acts have been amended this year, some have not. Over the period, some draft legislation has been delayed or put aside entirely, for various reasons including local influence, and often after considerable committee work and public ventilation. To prevent abandonment of the principle of uniformity, some legislation has inevitably been enacted which brought with it inconsistency and lack of precision and certainty.
The editorial goes on in that vein. Yet the Opposition says that the concept of making it a national Corporations and Securities Industry Bill is something new. The fact is, of course, that it cannot accept the position that only by having Commonwealth legislation and throwing overboard its archaic abeisance to State rightism can this be achieved. It will not commit itself, I repeat, as to what it would do. Let me just draw attention to that point. I refer to a paragraph which appeared in the ‘Sydney Morning Herald ‘ on 3 1 January which dealt with a seminar which was held in the Wentworth Hotel on 30 January of this year. The article reads:
But Senator Greenwood backed off from committing the Opposition to any specific course of action, except to say that the Bill should not be rushed through.
The Opposition is still saying that the Bill should not be rushed through, almost a month later. When is it going to commit itself? We have heard the comments of a number of Opposition supporters on this Bill, but really they made, I think, only one legitimate claim and that was in relation to appeals against particular decisions of the Commission. That matter is taken care of in the amendments which the Attorney General (Mr Enderby) has already brought before the House. I believe that he would have already said- if he has not, I say it now- that all of the submissions on the details of this Bill will continue to be looked at. It is some weeks before the Bill will get through the Senate, if indeed the Senate does discuss the Bill at all.
Let me point out also that this is only the first of 2 Bills of this nature which must come before the Parliament. Of course, there must be a National Companies Act as well, covering all of those areas which have not been covered by this Bill in relation to corporations. The AttorneyGeneral has said in his second reading speech that when the second measure comes before the Parliament it will be amalgamated with this Bill. There will be another occasion for everbody interested to put forward ideas on the detail of the Bill to ensure that it is properly considered. I commend the Australian Associated Stock Exchanges. As the member for Adelaide, I was given promptly on my request, after receiving a telegram from the chairman of the Australian Associated Stock Exchanges, Mr Tom Phillips, telling me that it was available, a document setting out the detailed comments and recommendations on the Corporations and Securities Industry Bill. Far more worthwhile work has been put into this document than the Opposition has put into the formulation of its attitude, as displayed in the debate both last night and this afternoon.
The Opposition is not against the overall concept of the Bill, as I see it. I have not been able to read that into Mr Valder’s comments either, which I read in the ‘Sydney Morning Herald’ of 13 February. As I said, I analysed his article in great depth. If I have not already said it, I say it now. It seems that the right of appeal was the only major disagreement that he had. Of course nobody in his position is going to enjoy a Commission such as the one which is proposed to be set up and which will be watching over the activities of the Stock Exchange. But I read into that article no strong conviction that that is not inevitable. One would expect such people to put up a rearguard action on it. When it came to the details of the Bill, I repeat that it was only the right of appeal that meant anything to me.
I come back to the point I was making about the detailed comments of the Australian Associated Stock Exchanges, a copy of which I have in my hand. This document will, of course, be studied in great detail and there will be many other opportunities for its recommendations to be incorporated in amendments if they are found to be of substance. The extraordinary attitude of the Opposition is really highlighted in a report in today’s ‘Australian Financial Review’ on the contribution made to the debate yesterday by the Deputy Leader of the Opposition (Mr Lynch). The article reads:
He said that the Opposition opposed the blending of corporations and securities industries laws into the one legislative enactment.
These 2 aspects should be kept divisible and separate and should be administered by 2 regulatory bodies ….
Why? Yet again no explanation is given as to why that should be so. Perhaps the honourable member for Moreton (Mr Killen) who is to follow me in this debate will give me an explanation. It seems to me that if we have 2 regulatory bodies we are getting away from one of the great virtues in this Bill, namely, the industry itself knowing with whom it is dealing. At the moment we are trying to overcome the shocking anomalies and inconsistencies created in the Companies Acts which provide for seven different bodies to deal with people who operate in this field. Why does the Opposition want to break down the 7 bodies to 2 bodies? Why does it not want just one body? In that case everybody would know with whom he is dealing. People would know the attitude of one regulatory body and then have a right of appeal against the decisions of that body. Later on the Deputy ‘Leader of the Opposition showed more inconsistency in the attitude which he took. I read again from the report in this’ morning’s ‘Australian Financial Review’:
Mr Lynch ‘s speech, however, did point up something of a dichotomy in the Opposition ‘s argument.
On the one hand it is saying that many of the powers of the Commission are too wide and arbitrary, while on the other aspects, it says, the Commission should nave stronger powers In other words he is indicating that the Commission should have the power to act more quickly and decisively.
At the same time the Opposition complains that the Commission can act without any regard for review by an aggrieved party.
It is completely inconsistent for the Deputy Leader of the Opposition to criticise the way in which the Commission can work on the one hand, because there are safeguards against its acting too pre-emptorily and, on the other hand, to say that there are not sufficient safeguards. That completely signifies the dichotomy of thinking that is exemplified generally in the Opposition’s attitude to this Bill. Apart from the 2 professional journals from which I have quoted and which show that those working in this field particularly recognise the strong need for a national approach, I want to quote also from an article in the ‘Australian Financial Review’ of 8 November 1973. The article, which is headed Most company men favour Federal law’, reads:
There exists a multiplicity of organisations which claim to represent business, to know the attitudes and needs of business or particular sectors of the business community.
In recent times these organisations have made many assertions and claims. One in particular was made by Mr Williams, president of the Australian Chamber of Commerce and a similar view was expressed by Mr Irvine, a solicitor speaking for the Institute of Public Affairs (New South Wales).
How these gentlemen reached their conclusions -
The conclusion that a national approach was not needed- is not known though Mr Williams has stated to the writer -
Harry H. Rappaport of the School of Economic and Financial Studies at Macquarie University- that no survey was attempted. Both have categorically stated that the business community is strongly opposed to the idea of federal companies legislation.
Some weeks ago, and prior to the dissemination of the above assertions, a questionnaire was prepared which, among other things, asked that views be expressed relating to the desirability of:
The questionnaire was sent to 198 companies secretaries, S3 large firms of chartered accountants, 60 firms of stock brokers.
The results of this survey as it relates to the above questions are tabulated below.
I ask that leave be granted for that table to be incorporated in Hansard. Unfortunately the honourable member for Moreton (Mr Killen) was not present earlier in the day for me to show it to him.
– I accept my friend’s word on that at least.
-Is leave granted?
-There being no objection, leave is granted. (The document read as follows)-
– I thank the honourable member for Moreton and I thank the House for granting me leave to have the results of that survey incorporated in Hansard. The response from the accountants, brokers, company secretaries and other groups was overwhelmingly in favour of a national companies law and a national securities industry law. In describing how ridiculous the propositions advanced by the Opposition in this debate are, I would also like to draw attention to an article in the ‘Australian Director’ in which the views of Senator Rae are made known. I noticed that the right’ honourable member for Lowe (Mr McMahon), who preceded me in the debate, was very quick to quote some statement that Senator Rae put out last night which, once again, in no way committed him as to exactly in what form he would have a national companies Act or a national securities Act but which was merely in criticism of what is contained in this Bill. When one reads the views of Senator Rae, as stated in the article to which I am about to refer in the ‘Australian Director’, one can see what turmoil of mind and what anguish he is suffering on this subject. Although Senator Rae sat as the Chairman of the Senate Select Committee on Securities and Exchange, which has pointed up all the shocking things that have happened in the industry generally, when it has come to deciding what he would do about them he has been completely uncommitted and has not given us any idea of what would be suggested by him. The article, which is about an address given by Senator Rae, reads:
We have real and immediate problems. Many people in Australia are frightened, uncertain and disillusioned.
He was talking about what has gone on in the stock exchanges. The article continues:
In May 1972, when speaking of the need for reconsideration of our concepts and legislative approaches to company and securities industry law, I said, ‘The idea that we, as a sovereign nation dealing with an industry of fundamental importance and national breadth and significance, should find ourselves patching up a series of tattered veils makes me fear the cold winds of an economic winter. ‘
I believe that we now find ourselves shivering, inadequately clad, in those cold winds.
Apparently nobody is having more influence upon the thinking of the right honourable member for Lowe and perhaps upon the thinking of other members of the Opposition than Senator Rae himself. He is allowing us to go on shivering by not committing himself to what form of law the Opposition would sanction. Later in his address Senator Rae said:
We must therefore balance the freedom of those in the monopoly position to continue their monopoly against the freedom of those who would otherwise wish to exercise their freedom of enterprise, but are prevented from doing so.
Later still in his address Senator Rae said:
The line to be drawn in regulating is, I believe, to be found at the point where the regulation ceases to provide for the fair, free and efficient exercise of the right and commences directing those who would otherwise wish to exercise that right in a way which curtails or changes their objective.
I could go on with other quotations to show the complete dilemma of Senator Rae’s thinking. Surely the answer is to have a commission with the flexibility of the Commission which is sought to be set up by this BDI. Surely the answer is for the industry to learn the rules of a body which has a continuing nature and deal with it rather than to expect a similarly satisfactory situation to result from the putting of all these regulationsregulations which cannot have the flexibility that the proposed Commission’s regulations will have- into law.
I hope that I have shown in my contribution to this debate on the motion for the second reading of this Bill that there is an urgent need for such a Bill. I repeat that it is only a first step. I look forward to a national companies Act also being enacted with further regulations of companies at a national level because, as somebody who has worked in this sphere, I recognise perhaps more than most people in this House the tremendous difficulties of having 7 different companies’ offices in Australia, 7 different Acts and all the anomalies that go with that. Of course, the State companies Acts are no longer uniform in any shape or form because they have been amended so many times. But even if the law is the same, it is a fact that the administration of that law in the various areas differs.
-Order The honourable member’s time has expired.
– I must admit at once that I have been left with the impression that the honourable member for Adelaide (Mr Hurford) favours the Bill. I am bound to tell him, in equal candour, that I have not been left with the impression that he quite understands it. Let me turn to the first commitment that the honourable gentleman has made and that is with respect to the support he gives the Bill. He has given very generous support, unstinted support, bold support; but for what has he given support? He has given support not merely for a proposal that sin should be abolished. The honourable gentleman has declared that there is only one way in which to abolish sin and that is to establish an abattoir. I would like to say to the honourable gentleman, to the House and to the people outside that there is no doubt as far as the Opposition is concerned as to the need for some regulatory body.
– You had 23 years in which to act.
-The Attorney-General interrupted me and said that the previous LiberalCountry Party Government had 23 years in which to act. I want to show the brilliance of the Attorney-General’s logic. If one takes it and extends it one could say that the AttorneyGeneral would say that 23 years ago- in 1942- we should have been operating DC9 aircraft on the Canberra to Sydney route. Do not distract me from the remarks of the honourable member for Adelaide and his asseveration as to what the Opposition would do about a regulatory body. I want to say without the slightest ambiguity that we would establish a regulatory body, but that what follows is: What character of body? This is where we differ. Let there be no complaint from or misunderstanding on the part of the honourable gentleman or any of his colleagues as to what are the views of those who work in this industry. Mr Valder and Mr Campbell Johnston- 2 distinguished and highly respected Australians who work in this fieldhave said plainly that they favour a regulatory body of some description. So what is at issue between the Government and the Opposition in this matter is not simply to have a regulatory body as such. We are for all practical purposes ad idem on the point. What is at issue is what sort of system there would be.
Before I turn to look at the Bill itself may I make a glancing blow at my friend the AttorneyGeneral with respect to the time table of this Bill.
I was immensely indebted to the honourable and learned gentleman for his assurance that this Bill would be afforded reasonable time for debate. I hope that he will not succumb to any pressure which may be placed upon him by that wily, albeit that lovable, that insinuating colleague, the Minister for Services and Property (Mr Daly), who has been on the hot line finding out exactly what the orders should be on this issue. So I plead with the Attorney-General: Do not succumb to the Leader of the House, to any of his blandishments, to any of his wiles or to any of his manoeuvres. Stand fast as we expect of any respectable Attorney-General. Stand fast and say: ‘Yes, there will be reasonable time afforded for debate’. If there should be the slightest movement towards the tumbrils to the erection of the guillotine I ask the Attorney-General that he find that quality and sternness of character to say: This will be done over my dead body’. Having said that, let me say this to the Attorney-General, not by way of some grudging exercise -
– Why not talk about the Bill?
-When I come to talk about the Bill I can assure the honourable gentleman it will not be to his advantage or comfort. I want to say something further about the honourable gentleman’s attitude as to what this House should do with a Bill that comes from the Senate. I find deeply offensive the argument that because the Senate has had a Bill for 2 months or 2 years, ergo this House should pass it through. We have our own rights. We have our own responsibilities and they are not to be whittled away by the Attorney-General ‘s indulging in sophistry of that character. I would regard it as an impertinence for us to seek to tell the Senate what to do. Similarly I would regard it as an impertinence for the Senate to tell this chamber what to do. I ask my honourable friend to reflect most earnestly upon the curious position into which he has thrust himself.
I turn, at the constant beckoning of the Attorney-General, to the Bill. I am delighted to be able to turn to the Bill. There are 2 philosophies associated with it. I do not know whether the honourable gentleman has yet identified them. My friend the honourable gentleman from Adelaide made one or two, I thought, rather high spirited observations about some of the philosophies. But we will come to this as I cull them out, not in terms of offence to me per- sonally but as they may come back to my mind. The first philosophy behind this Bill is, of course, the philosophy which distinguishes the Labor Party from the Liberal and Country Parties, and that is its fond belief that everything in this world can be controlled and regulated- not merely its fond belief that it should be the case but its determination to see that that should be the case from the cradle to the grave. The Labor Party’s philosophy is to get the Government to do it, to look after the people, to make sure that whatever excesses there may be in human activity, whatever temptation there may be to succumb to the world, these can be cured by legislative means.
That is the dominant philosophy of the Labor Party and it is no better presented than in this Bill. But caught up in that, of course, is also the fact that our society, our system, is to be controlled and planned. The cry of the socialists in this country is simply this: ‘Give us the controls, give us the plans and we will look after everything’. I am bound to say this to the AttorneyGeneral: Give him one plan and one runs a risk; put in his hands a number of plans and one stands in certainty of being greeted by chaos.
– What about talking about the Bill?
– The honourable gentleman makes an interjection regarding the details of the Bill. We will have a splendid opportunity of finding out how much homework the honourable and learned gentleman has done on this Bill when we get into the Committee stages. I am seeking to deal with what I describe as the principal philosophies behind the Bill and I would have thought the appropriate time to do that was during a second reading- speech. If I were, for example, to turn to, say clause 60 which deals with the capacity of the Attorney-General to suspend a stock exchange from trading for 21 days, I say to the honourable gentleman with respect, that it would be inappropriate for me to do so at this time. But I may succumb to his taunts a little later on.
I hope no person will be in any doubt at all as to what is meant by this Bill. It seeks to control everything in this country. The honourable member for Adelaide has asked why it is that we complain about putting together corporations and securities. I think there is an explanation readily available, even if it may not be readily accepted by the honourable gentleman. We are dealing with 2 entirely different characters. We are dealing with corporations and individuals. We are dealing with 2 entirely different sets of circumstances, 2 entirely different sets of problems. The honourable gentleman may say: ‘Well, I am not prepared to accept that’. That is the decision that he makes. Whether or not it will be made to the advantage of those who are affected only time will tell.
The form of the legislation leads one to the conclusion that there has not been proper consultation in the first place with the States and in the second place with , those who work in the industries and in the field. I turn to the first consideration, namely, consultation with the States. I do not yield to the honourable member for Adelaide or any other person in this Parliament in my anxiety to have established and to see recognised a proper priority for national consciousness. But one does not achieve that by ignoring the realities of the existence of the States. One finds this expressed not merely in Liberal-Country Party run governments in the States; one finds it expressed in Labor run governments in the States. The Premier of South Australia has an anxiety in this field. I find it a very understandable one. The Premier of Victoria has an anxiety in this field. All of these anxieties are completely intelligible. One does not build a proper priority for national consciousness by ignoring the existence of the States and giving them the impression that one simply does not care. But beyond that, I invite the House to think of the confusion which can and will flow from pretending that the States do not exist, particularly in this field.
As for the second observation- the failure to consult those in the industry- I think it is a very sad state of affairs that when responsible Ministers in a Government give undertakings to people that their submissions will be considered, those undertakings are rejected. That is precisely what has happened on this occasion. Many submissions have been made by people who have worked in the field for many years- people who speak with authority and with experience. Why the haste on the part of the Attorney-General (Mr Enderby) and on the part of the Government to proceed with this Bill and to ignore the useful suggestions which have been made? I refer my honourable friend to the fact that he intends to move 19 amendments himself.
– There are really only three.
-The Attorney-General has indicated that he will be moving 19 amendments but he now says there are really only three. I want to tell the Attorney-General that I will ensure that he gets an invitation to the annual St Patrick’s Day dinner in Brisbane. He has 19 amendments here -
– I would not want him counting sheep.
-Fancy the Attorney-General counting sheep, as the honourable member for Wakefield suggests. There might -be 19 sheep running along the fence but the AttorneyGeneral would say: *Oh no, there are not 19 there, there are only three’. I bow before the fertility of the Attorney-General’s imagination. I just want to come on to the -
– Well, a little further on to the Bill. It is all very fine for the honourable member for Adelaide and the Attorney-General to sneer at the philosophy behind this Bill. The fact remains that this Bill, in its present form, is a significant assault upon the private sector in this country. Let no person be under any misapprehension about that. The private sector means the 75 per cent of the people in this country whose living and whose happiness depends upon free enterprise. This is the system that the Government wants to change. This Bill represents a significant attack upon the private sector.
– They have had it in America since 1934.
-Oh yes, and they have had the electric chair in America too but there is no reason the Government should seek to thrust us into the electric chair.
– Do you want one or not?
– I thought that I said quite plainly earlier that we support a regulatory body. I am quite prepared to concede that the honourable gentleman has limited cerebral capacity to understand my argument but it rather frightens me to find that he is suffering from some other malady- he cannot hear. Plainly we want a regulatory commission of some description. We do not want this sort of commission where 5 people are given completely untrammelled powers. It is all very fine for the AttorneyGeneral to say that this is not the case. I will illustrate it -
– I did not say it was not the case.
-Well, there is the admission. It is great to get an admission from one’s opponent in court when he says that this is not the case. The Attorney-General has said it is not the case that this Commission has untrammelled powers.
– It is subjected to parliamentary scrutiny.
-The Attorney-General says it is subjected to parliamentary scrutiny. Listen to this, Mr Deputy Speaker. Clause 61 of the Bill states:
The Governor-General may, where he considers it necessary or desirable to do so for the protection of persons buying or selling securities or in the interests of the public, by notice in writing to a registered stock exchange . . .
It goes on to make provision that the GovernorGeneral in Council can shut down an entire stock exchange. There is no appeal against that decision whatsoever. That is a power about which I would have thought that even the most ardent socialist planner would have thought twice. Let us say, for example, the Governor-General in Council, that is to say the Cabinet, should recommend to the Governor-General that, because of some attitude taken by. Broken Hill Pty Co Ltd, BHP shares should be blocked for trading purposes. That is plainly a power in this Bill. There are about 180 000 shareholders and 56 000 employees in that one great company. The whole existence of those people could be put in jeopardy- not some passing jeopardy but in very real jeopardy. That is a mere example of the hundreds of powers which the Government proposes to give to this Commission subject only to the most distant and the most ill-defined forms of parliamentary scrutiny.
The last matter to which I would like to refer is the argument which has been pressed upon us by the honourable member for Adelaide and others that what was revealed by the Rae Committee is the reason for the existence of this Bill. I find that a very curious argument indeed if for no other reason than that this Bill, in very real measure, does not cover the mining companies concerned. What the Rae Committee’s inquiry revealed was a form of venality, a form of avarice, but not throughout the whole of Australia because that is not the character of the overwhelming majority of Australians. What it found by way of dishonesty was substantially- almost exclusively, one could say- restricted to mining companies. Here it is -
– That is not true.
– Well, we will find this out in time. The Attorney-General is piloting through this House a Bill that exempts, or substantially appears to exempt, the very people about whom complaint is made. To recapitulate, the Opposition would establish a regulatory body but the Opposition would seek to bring balance, perspective and reason in the whole conduct of that regulatory body. This Bill is yet another Bill on the way to smash the private sector in Australia and to seek to erect a socialist edifice to assuage the vanity of those who presently sit on the Government benches.
Motion (by Mr Nicholls) put:
That the question be now put.
The House divided. (Mr Speaker-Hon. J. F. Cope)
Question so resolved in the affirmative.
That the words proposed to be omitted (Mr Lynch’s amendment) stand pan of the question.
The House divided. (Mr Speaker- Hon. J. F. Cope)
Majority …….. 10
Question so resolved in the affirmative.
That the Bill be read a second time.
The House divided. (Mr Speaker- Hon. J. F. Cope)
Question so resolved in the affirmative.
Bill read a second time.
Sitting suspended from 1.7 to 2.15p.m.
– Is it the wish of the Committee to consider the Bill as a whole?
– I would suggest that we do, Mr Chairman.
– An objection has been raised. Therefore, we must take the clauses seriatim.
Clauses 1 to 3- by leave- taken together.
-Clause 3 of the Bill contains a number of definitions and I would like the Attorney-General (Mr Enderby), to explain if he would, one or two points in relation to them. The definition of ‘business rules’ is of interest and I wonder whether it includes listing requirements. The definition of ‘current liability’, of course, is understandable, but, as far as I can see, nowhere in the Bill is there a definition of ‘current assets’ although it is referred to in clause 129. Elsewhere there is a definition of non-current liability’ but not of ‘current assets’. I would have thought that ‘current assets’ needed defining because the character of the assets is an important aspect. The definition of debenture’ includes the words ‘or acknowledging indebtedness’. One wonders whether that includes a bill of exchange or perhaps a cheque because if it does obviously it will inhibit a lot of transactions which at present are regarded as legitimate transactions.
Those definitions are important, as is that of prescribed corporation’. I think this has given rise to some representations to the Minister but these are not covered in the proposed amendments. It is not really understood by me and by others why significant parts of the legislation apply to prescribed corporations whereas the intention of the legislation which has been stated is that it is to regulate the activities of registered corporations. It may well be that there are cases where certain provisions of the legislation apply to companies other than registered corporations but, if that is so, surely they should be singled out for special treatment. Is it intended that clause 83 ( 1 ) of the Bill should require holders of licences and financial journalists to maintain registers of interest in securities of prescribed corporations, including private companies? This is a matter of definition and is of considerable significance. I believe it goes to the root of the whole legislation and requires urgent consideration. Therefore, to make the Bill more understandable to those who are affected by it, it seems sensible to use the words ‘registered corporation’ throughout the Bill in place of the words ‘prescribed corporation’ except in cases where there is a clear necessity to have wider coverage.
The other question that arises- I think it was alluded to by some honourable members during the second reading debate on this Bill- is whether the definition of ‘prescribed corporation’ includes mining companies. It would appear that a major objective of this Bill would be to have an effect on mining companies. During the second reading debate on this Bill certain Government supporters rather emphasised practices in respect of mining companies of which they disapprove. I would be interested to know what the Attorney-General has in mind in that area as well.
-I also address myself to a couple of definitions and to why this legislation has become necessary. I am pleased that the honourable member for Moreton (Mr Killen) is leading for the Opposition because he shares with me an interest in another form of gambling. I suggest that he would be extremely concerned if racing, for example, through the Australian Jockey Club were controlled by licensed persons, as they are called in racing, in the same way as the stock exchanges have been controlled. I remind honourable members- many honourable members may recall this- that during the share boom period Mr Gordon Barton of Australia Party fame- not Thomas Barton- was involved in an attempt to make moneyon the stock exchange. It was a perfectly legitimate attempt under the existing rules of the stock exchange. He bought shares in a company whose name I have forgotten. Stock brokers short sold those shares. In other words, they sold shares in that company, although they did not have shares. They undoubtedly assumed that they would be able to get the shares for some lesser amount at some later stage and make a profit on the deal. What happened was that the number of shares Barton and his associates bought greatly exceeded the number of shares over which the brokerage companies could get control.
I note that the Chairman of Committees appears concerned about whether the matter with which I am dealing is relevant. I am speaking of registered stock exchanges which control the market at present. Let us say that Barton bought these shares for 10c or 20c each and that the shares increased to $5 or $10. What happened was that the stock exchange suspended all sales of those shares even though the shares had not been delivered. The only avenue through which people could buy shares was from Barton himself. What I am putting is that this situation would correspond to the situation where the AJC Committee consisted of bookmakers. If, in the days when the honourable member for Moreton had a lot more money than he assured us he had when he was discussing the financial interests of parliamentarians, he had invested all his money on a horse at 4 to 1 and the bookmakers had expected that its price would drift to 5 to 1 or 6 to 1 so that they would cover themselves, but it started at odds on, the bookmakers controlling the AJC Committee could cancel all bets on that particular race and start betting again. I think the honourable member for Moreton would be extremely disappointed and would feel that the AJC Committee had not acted as an independent committee should act. This analogy explains why I am criticising the stock exchanges to which the provisions of this Bill relate. I am concerned with how people behave on the stock exchange.
– I think the honourable member for Prospect is ranging somewhat wide of the definition of stock exchange.
– The AJC is not mentioned in this Bill.
– No, but I am comparing the behaviour of the stock exchanges during that boom period with the way one might possibly expect the AJC Committee to behave if its members comprised people with a direct interest in racing- bookmakers- who would also act as stewards.
The second point to which I should like to address some remarks relates to financial journalists. I think it was the honourable member for Curtin (Mr Garland) who referred to this question. I think it is important that financial journalists should be covered by this legislation. These people have an important role to play regarding malpractices associated with the stock exchange. I shall quote from an article which contains a summary of the report of the Senate Select Committee on Securities and Exchange. It states:
In connection with placements by Surveys and Mining Ltd via Ralph W. King and Yuill, and other brokers, the report notes that among the list of privileged subscribers (the shares were 60c compared with the market price of 90c) were-
I will not go into all the details. Then the article continues:
Six financial journalists including one financial editor and some other seniors, employed on 5 daily newspapers with an influence on the Sydney and Melbourne share markets It is hard to escape the conclusion that the deliberate inclusion of the journalists in the placement was designed by the company, first, to stifle possible criticism of the placement technique . . . and secondly, to offer the journalists a personal financial incentive to give relatively favourable treatment.
The committee does not suggest that all the journalists responded in the way the company presumably hoped they would.
The article then goes on jo name the 6 journalists concerned. They were Neil Speirs, Michael Kulakowski, Jules Zanetti, Cliff Riggs, Ervin Katz, Michael Baume, Geoffrey Phillip Short and Peter D. O’sullivan. I think that the Michael Baume mentioned in that article is the endorsed Liberal candidate for the seat of Macarthur.
– He will win it, too.
– That is why you are so very touchy about it.
– If only the honourable member for Bennelong would get as excited about other people who are unable to defend themselves in this House. In his first session in this House he was the first person who attempted to have debated matters relating to an outsider.
-Order! We are discussing the definitions and 2 other clauses- one dealing with the name of the Bill and the other with the date of operation of the Bill. I think that makes it a fairly narrow debate. I do not think that the sub-headings of the definitions clause open up the Bill for a broad debate on the persons named in the Bill.
– Obviously I accept your ruling, Mr Chairman, but the only point I make is this: Why are financial journalists included in the definitions contained in the legislation? The definition of financial journalists ‘is as follows: financial journalist’ means a person who, not being the holder of a licence, in the course of his business or employment contributes advice, or prepares analyses or reports, concerning securities of prescribed corporations for publication in a newspaper or periodical.
Previously in this House I have attacked a financial journalist. I think it is important we should note that journalists make very broad attacks on parliamentarians. We should also remember the great influence that journalists, particularly financial journalists, in this instance, have upon the kinds of shares people buy and the kinds of investments people make. In speaking about financial journalists, I congratulate the financial journalist in the ‘Financial Review’, who writes under the name of ‘Chanticleer’, for his exposure of some companies which are attempting to lure people into depositing or investing money with them. I commend to the House the clauses that we are considering.
-I draw the attention of the Committee once again to the definition in clause 3 of the Bill which defines a prescribed corporation and broadly covers the corporations which are to be registered. Strangely enough, it omits any reference to public companies or companies which have issued securities to the public. In fact, it appears to follow the prescribed corporations to which parts of this legislation apply and relates also to private companies. It has been indicated, as I understand it, why significant parts of this legislation apply to prescribed corporations, whereas the clear intention, as emphasised by the AttorneyGeneral (Mr Enderby) in his second reading speech, is to regulate the activities of registered corporations. There may well be cases where it is intended that certain provisions of the legislation should apply to companies other than registered corporations, but surely there is a case that they should be singled out for special treatment where there is a requirement for this to be the case.
For example, is it intended that clause 83 ( 1 ) of the Bill should require holders of licences and financial journalists to maintain registers of interests and securities of prescribed corporations thus including, presumably, private companies, although this point is not adequately defined.
Furthermore, the definition of ‘dealing’ in clause 3 would presumably cover, in relation to securities, an attempt to induce a person to offer or to make an arrangement, the purpose of which is to secure a gain for any one of the parties concerned. °The definition of ‘investment adviser’ in the same clause of the Bill presumably means a person who in the course of a business- I take that to mean any business- carried on by him or through him advises other persons concerning securities. It would appear clear that the implications of this are quite fantastic. For example, consultants and advisers in various fields, and even solicitors and accountants, are often involved in advising their clients on the handling of their portfolios and securities generally. Is the definition of an investment adviser to cover these sorts of people? Because of the narrowness of the exception in relation to investment advisers, it is quite obvious that such people are clearly caught by the words of the present definition. This is so despite the fact that the activities by which they are caught are in no way intended to be regulated and do not fall within the intended scope of this legislation. Management and financial consultants appear to be an example of persons who would in total innocence find that a particular action with which they may have incidentally been associated will bring them within the confines of this definition.
-In dealing with the definitions clause, I invite the AttorneyGeneral (Mr Enderby) to consider the last point made by the honourable member for Prospect (Dr Klugman) concerning financial journalists. The definition, as it presently stands, refers to the publishing of information in a newspaper or periodical. Many financial journalists in this country would prepare material and have it published, but it would not be published in a newspaper or a periodical. I refer to information circulated by various people throughout the country. There seems to me to be a need to tidy up the clause- if need be, to broaden the definition a little.
I also invite the Attorney-General to put into the Bill a definition of a stockbroker. It seems to me to be quite incredible that we are dealing with a Bill relating to the securities industry and there is not a definition of a stockbroker. Possibly my friend the Attorney-General may have some explanation for that. If there is a definition I invite him, if he would be so kind, to refer us to it. I also suggest that the Attorney-General considerif not here, possibly in another place- that the definition of ‘securities’ should include a reference to unit trusts. It seems to me to be a conspicuous gap that there is no definition of a unit trust, because it represents a considerable field.
– There are other provisions.
– I am speaking of the definitions clause. There seems to be to be a gap there, and we aim to please. If I can find some minor blemish in the Bill I am quite sure that the AttorneyGeneral would not take the slightest exception to my making a suggestion on the point.
-I will be brief. I share the concern of the honourable member for Moreton (Mr Killen) in relation to unit trusts, but I am rather inclined to the view that the position is covered elsewhere in the Bill. I trust that it will be. I will speak on that provision when it comes up. I address myself to the AttorneyGeneral (Mr Enderby). I will be very brief. I have had a number of requests for an explanation from companies that handle or assist in trading in their own shares. Do they have to be licensed under the provisions of this Bill as a stock exchange?
– Without being unnecessarily abrasive -
– You could not be.
-Try me some time. One has to admire the apparent reasonableness of the members of the Opposition as they ask that this Bill, containing nearly 300 clauses, be considered in Committee and they start off by directing attention to the title clause, clause 1, to clause 2 and to the definitions clause, clause 3. One is entitled at the outset and without being unnecessarily abrasive to question once again the motives of the Opposition.
– Here we go again.
– I will say it because it will be relevant to what I say answering the questions that have been raised. It is known that this Bill has been a public document for 3 months. Yet members of the Opposition come in here now and start asking questions about the definitions clause as though they have never seen it before. The inference I put forward, before I go on to give some information about the questions asked, is that they are not really serious. The Government does not believe in their sincerity on this matter one little bit. I certainly do not accept their apparent sincerity which is now being put forward by mock bad actors. All they are seeking to do is to delay and frustrate this measure. They see this going on and on for 6 months. They do not want this measure to become law, notwithstanding what they say to the contrary.
Some aspects of the definitions clause raised first by the honourable member for Curtin (Mr Garland) can be dealt with reasonably shortly. He talked about the mining companies. He would be aware that there is an area of uncertainty as to whether the constitutional scope extends to them. The definition is in the Bill. It depends, of course, on the activities of the companies. On that point one can only refer to the mischief which was revealed by the investigations of the Senate Select Committee on Securities and Exchange and which applied not so much to the mining companies but to the trading that took place in mining shares and mining stock.
– The machinations.
-As the honourable member for Hawker interjects, and rightly so, it was the machinations. It was the trading, the shenanigans and the crooked dealings which took place in regard to the securities in those mining companies. It was not so much the conduct of the mining companies themselves but rather how the smart boys in Melbourne, Sydney and Adelaide got to work on the shares and the securities. That is the mischief at which this legislation is aimed. It is that mischief which this legislation is intended to cure. The honourable member for Curtin asked whether the definition of ‘debenture’ extended to instruments such as bills of exchange. It clearly does not, in the sense that the use of the word ‘debenture’ has to be related to the issuing of a prospectus to the public. In other words, it is the issue of a document or an instrument to the public as a means of subscribing funds at which this legislation is aimed, and a bill of exchange does not come into that at all. Whatever was the appropriate instrument that might be used by a corporation to achieve that purpose, it would be caught by the definition of ‘debenture’, but it is most unlikely that it would be a bill of exchange.
I think it was the honourable member for Bradfield (Mr Connolly) who raised the question of prescribed corporations and said that there is no reference to companies which have issued securities to the public. I direct his attention to clause 45 which uses the definition. I think he will find that that clause makes it clear. The other question related to journalists being required to register their interests in matters of this sort. We all know the power of the Press. Politicians probably know it more than any others do. It has been considered necessary to ensure that journalists keep records of all their securities and transactions because if they were not required to report their interest in securities of private corporations they could really use private corporations to deal for them in public corporations. The measure that has been adopted in the Bill is completely consistent with that whole main thrust.
There is nothing novel in this approach. It goes right back to one of the very early pieces of legislation of this Parliament, the Secret Commissions Act. The whole concept of the breach of fiduciary duty between principal and agent is dealt with in that very early Act of this Parliament. We all know the opportunities for abuse between principal and agent. We all know the obligations on, say, solicitors to have trust accounts and to keep their funds separate from those of their clients.
We know the high standards of care and duty imposed upon them because of the opportunities for abuse. This Bill seeks to extend those duties which have existed for many years in ordinary areas of law, such as principal and agent, into this growing securities industry. It should be said in passing that, notwithstanding the bluff hyperbole and acting of the Opposition spokesmen who referred to this Bill as a measure of socialism, it was introduced into the United States of America- the homeland of capitalism- in 1934.
-Nothing like this.
– It is modelled on it, as the honourable member well knows. It is designed to make the capitalist system work better, not worse.
-I put aside the continued complaints of the AttorneyGeneral (Mr Enderby) about the Opposition’s questioning of this Bill, except to say that surely we made it clear in the second reading debate, if anything was made clear, that we think that many of these clauses require far more explanation and justification. We are entitled to ask questions. We propose to do so. I might say- this should be of interest to honourable membersthat it is high time the House of Representatives took on the job instead of leaving it all to the Senate.
I do not want to spend my full time every time I rise, but let me come back to the 3 points which. I made before and which the Attorney-General did not answer. Does the definition of ‘business rules’ include listing requirements? Will he consider putting in a definition of ‘current asset’ as there is one there already for ‘current hability’ and for ‘non-current liability’? In respect of prescribed corporations he responded to some of the questions asked, but I draw his attention to the matter which I mentioned first. Why do significant parts of the legislation apply to prescribed corporations, whereas the clear intention of the Bill- one can quote the AttorneyGeneral’s speech against him here- is to regulate the activities of registered corporations? What is the need to cover private companies as well? Lastly- this is the point my colleague the honourable member for Bradfield (Mr Connolly) raised- can we not have a definition of ‘public company’ as referred to in clause 45 in the definition?
-I want to make one observation. The Attorney-General (Mr Enderby) said that he did not wish to be abrasive. I think he has brought to the opening of the debate in the Committee stage of this Bill the charm of a dilapidated knackery. It is an impudence on the honourable gentleman’s part to say that the attitude of the Opposition in this matter is one of obstruction. Surely to heavens we are entitled to offer some views with respect to the provisions in the Bill. All I asked the honourable gentleman to do was to give an explanation as to why there was not even a definition of ‘stock broker’ in a Bill of this nature. There was nothing uncivil about the question. It was put to him properly and, I hope, pertinently. The Minister stirred himself to offer an insult. It passes me by, but I just draw his attention to the fact that the question was not put in any ungenerous fashion at all.
The second question I asked him was why on earth he would not include unit trusts in the definition of ‘securities’. Again, that question was not put by way of being tendentious or difficult. The fact that this Bill has been in the Senate for a few months is an utter irrelevancy. Does the Minister suggest that every time a Bill is introduced into the Senate we should sit down, get ourselves sopping wet with anxiety, a towel around the head, go through the Bills introduced in that chamber and then write to him asking him to tidy them up? What an impossible proposition. I do not dignify the attitude of the AttorneyGeneral by describing it as impertinent. I say that his attitude is one of studied impudence.
– It is to be regretted that the debate has degenerated into this type of exchange. I remind the honourable member for Moreton (Mr Killen) of the way in which the debate began. Who was it who moved for the suspension of Standing Orders in order to prevent the debate from proceeding and then wasted perhaps an hour or 2 hours of the Parliament’s time?
-Order! I suggest that the Attorney-General should not revive the second reading debate.
– I do not want to revive the second reading debate, but on the question of the credibility of Opposition spokesmen I am entitled to put the point as strongly as I can that their credibility is in doubt in relation to this matter because it was they who moved for the adjournment of the debate within seconds -
– Order! The matters which the Attorney-General is raising now are more relevant to a third reading debate than to consideration of the Bill in Committee. I ask him to deal with the clauses under consideration.
– I accept your ruling, Mr Chairman. Unless overriden, I shall deal with the matters that have been raised, bearing in mind the credibility or lack of credibility that I attach to Opposition spokesmen. A good example of it can be found in what the honourable member for Moreton said about the need for a definition of ‘stockbroker’. He has had the Bill for so long and yet he has not even read the definitions which it contains. If he looks at them he will find that the Bill includes a definition of a ‘dealer’ and that that definition, which is in the plainest of simple English, includes a stockbroker. The definitions in the Bill are taken straight from the State Acts in which the definition of a ‘stockbroker’ is not given. The honourable member suggests that it is an amazing thing that that definition has been left out of the Bill. It has been left out of every State Act dealing with this subject because those Acts have opted to give a definition of a ‘dealer’ as that definition includes a stockbroker. There are 3 definitions in the definition clauses of the Bill relating to that subject and I direct the honourable member’s attention to them. Once again this is an example of how the time of the Parliament has been wasted.
A simple reading of the Bill will give the honourable member the answers to his questions in relation to securities and mutual and unit trust interests. I direct the attention of the honourable member to Division 6 of Part VII of the Bill which the honourable member has had to study all of this time. That part of the Bill deals fully with the question of interests of various types, including the ones that he has mentioned. The honourable member should look to the definition of a ‘prescribed interest’.
-I am one of those members of the Opposition who were denied an opportunity to speak in the second reading debate on this Bill. Many of my constituents are very gravely concerned, not with the fact that there should be legislation of this type but rather with its substance. I take it very seriously indeed that the Attorney-General (Mr Enderby) should accuse me and other members of the Opposition of trying deliberately to slow up the proceedings in this House when the Government has taken a deliberate decision to prevent adequate debate on this Bill. If it was a Bill which suggested that trade unions should be brought under the same control as is now being suggested for companies there would be a tremendous yell. What the Government forgets is that the country has to work -
– Order! I gave a ruling before when the Attorney-General was speaking. I am afraid that I have got to give the same ruling to the honourable member for Bradfield who is reviving the second reading debate. The Opposition has chosen to take a narrow spread of clauses.
-I refer again to the comment which I made earlier and to which adequate answers have not been given. I mentioned earlier that no adequate definition was given in the introduction to the matter of a public company. The Attorney-General suggested that we should read Part III of the Bill which deals with the registration of corporations. In clause 45 ( 1) (c) we find reference to financial corporations formed within the limits of Australia and which are public companies, and so on, but still there is no definition of what is a public company. That is the question I asked previously and that is the question which I still require to be answered.
-I refer to the matter of unit trusts because it is a matter which does worry me a little.
– I am grateful. I have support.
-No, I accept the definition of the Attorney-General (Mr Enderby) but I just want to ask the Attorney-General to consider, when we come to deal with Division 1 in Part V, including that provision for unit trusts in what is in effect a register of different classes of people. I intend to raise the very same point in relation to unit trusts when we are dealing with clauses 213 and 2 1 8, as I mentioned last night. This is a point about which I have been asked on numerous occasions since the Bill was introduced, and I again ask the Attorney-General: If a company handles or assists in its own shares transactions, does it have to list itself, within the provisions of this Bill, as a stock exchange?
– The answer to the question raised by the honourable member for Hawker (Mr Jacobi)isno.
Clauses agreed to.
Clauses 4 to 12- by leave- taken together.
-I refer to clause 5 (b). I ask the Attorney-General (Mr Enderby) what would be the position if the office of the Commission is open but all other places in that State are shut on a particular day? That could happen if a public holiday is being observed for some reason. Without being dogmatic on the point, that clause does seem to me to be somewhat vague. That is the point I make in relation to clause 5 (b). I have some doubt about it. It may be a doubt founded upon an erroneous belief that there is a gap, a weakness, in the clause as it now stands.
– We would suggest that there is not a gap or weakness in the clause. It is written in simple English. I put it to the honourable member, for Moreton (Mr Killen) that I know of no rule of law that says that the English language can be made so precise as to overcome every possible contingency. The words have to be given meaning by the courts. Surely they are quite clear enough. The honourable gentleman knows of the breadth of words. In fact, he will have an opportunity perhaps tomorrow when we are considering another Bill to talk about specific words and general words. I will read to the honourable member the clear language of clause 5.
– I have read it several times.
-Let me read it to the honourable member again:
Where provision is made by this Act for an application, report or other document to be lodged with or given or sent to the Commission -
the application, report or other document shall be delivered, or sent by post, to the office of the Commission;
There are clearly understood legal rules that govern that situation, and the honourable gentleman knows them. The clause goes on:
They are well understood- terms and probably have been the subject of hundreds and hundreds of legal decisions - -on or by, as the case may be, the next day on which that office is open;
I also put it to the honourable member that the document must only be put in the post to be delivered on the next day on which the Commission is open. The clause seems to me to be completely clear.
-The AttorneyGeneral (Mr Enderby) mentioned earlier the subject of whether this Bill should be dealt with clause by clause. I want to point out that in my last contribution to the debate I asked 4 questions of him and he has not answered them. Presumably the Attorney-General is not going to be in a good position to answer the next question I am about to ask either because he is not listening to me. The Attorney-General did have some sort of a reputation around this building as a lawyer. I hope that it will survive this debate. The fact of the matter is that the amendments which are to be proposed by the Attorney-General- there is not one in relation to the clauses before the Committee at present-are the result of further consideration and consultation. It is because those proposed amendments do not clarify the situation I am looking particularly at clause 10 and making some reference to clause 12- that it is necessary for me to try to elucidate answers to my questions. It is making something of a mockery of the proceedings for the Attorney-General to continue to talk to the Leader of the House (Mr Daly) and not to listen to the question which I wish to direct to him. Clauses 10 and 12 of the Bill require offers of invitations to make deposits with or lend money to a company to be covered by a registered prospectus. I nave been advised that there is a considerable body of opinion that the traditional activities of the merchant banks and the industrial and financial corporations in the inter-company market generally could be impeded by this requirement. I ask the AttorneyGeneral to comment on that matter. I presume that that sort of impeding is not an objective of the Government or of this Bill because, of course, if it were it would affect a significant part of the Australian capital market.
– I was distracted. Will the honourable member give the number of the clause again?
– I was referring principally to clause 10 and making a slight reference to clause 12. Perhaps I should repeat what I have said; it is not long. Clauses 10 and 12 of the Bill require an offer or invitation to make deposits with or lend money to a company to be covered by a registered prospectus. I have been advised that there is a body or opinion that the traditional activities of the merchant banks and the industrial and financial corporations in the inter-company market generally could well be impeded by this requirement. I have said that I presume that that is not an objective or policy of the Government and that that is not an objective or intention of this Bill and that if it were so it would affect a very significant part of the Australian capital market. I ask the Attorney-General to consider clarifying this situation by amending the Bill.
– I also invite the Attorney-General (Mr Enderby) to consider clause 6 in relation to the matter I have already raised, that is, the need for a definition of the word ‘stockbroker’. The Attorney-General has said that no State Act has a definition of the word stockbroker’. The New South Wales Securities Industries Act has a definition of the word ‘stockbroker’. If this Bill becomes an Act the Government and those working under the Act will find difficulty right throughout the legislation in this respect. I implore the Attorney-General to abandon the obstinacy that presently possesses him and, in relation to clause 6 and the other clauses ahead of us for consideration, to reconsider earnestly the point I have made.
– I have considered it and I have rejected it. I am not being obstinate. I direct the attention of the honourable member for Moreton (Mr Killen) to the definition of ‘dealer’, which means a person carrying on a business of dealing in securities, I direct his attention to the definition of a ‘dealer’s licence’, I direct his attention to the definition of ‘dealer’s representatives licence’ and I direct his attention to the definition of dealing’, which states:
Dealing’, in relation to securities, means (whether as principal or agent) making or offering to make, or inducing or attempting to induce a person to make or to offer to make, an agreement -
for or with a view to acquiring, disposing of, subscribing for, or underwriting, securities;
That is stockbrokers ‘ work -
That is stockbrokers ‘ work.
– Will you get an opinion on the point, please?
– I ask the honourable member for Moreton not to be obstructionist and not to waste the time of this Parliament. I turn to the remarks of the honourable member for Curtin (Mr Garland), who asked a question about clause 10. He is not listening. Perhaps he is not really interested, as I have suggested. The honourable member for Curtin asked about the effect of clauses 10 and 12 on merchant banks and institutions of that sort. If he reads the Bill, particularly if he looks at clause 1 6 1 , he will find that it relates only to prospectuses which are being made as part of an offer to the public. So it clearly excludes the area of concern he has expressed.
– What number was that?
– Clause 161 and the whole context of the Bill. Please read it.
Clauses agreed to.
Clauses 13 to 15- by leave- taken together.
-There seems to be a clear error in clause 13. 1 hope that the Attorney-General (Mr Enderby) will listen to my argument on the point. It is a very short one. In the second last line of clause 13 there is use of the word ‘member’. The simple fact of life is that the members of the Australian Associated Stock Exchanges are the representatives of the 6 capital stock exchanges. The exchanges themselves are not members of the Australian Associated Stock Exchanges. I suggest that the defect could be cured if the word ‘member’ were deleted and the words ‘conference exchanges ‘ put in its stead.
-The AttorneyGeneral (Mr Enderby) has invited me to read the Bill. I have read it. I am wondering whether I can say the same for him. He has seemed to imply- this is relevant to the consideration of these clauses- that we should not ask him questions and examine him upon the Bill. He has a misunderstanding of the whole purpose of this debate and, I would say, a significant part of the role and activities of the House of Representatives. I direct the Attorney-General’s attention to the provisions of clause 14 and, in particular, of sub-clause (f). Clause 14 is intended to define associated persons. If I can just take the pertinent extracts from the clause, it reads:
For the purposes of this Act … the following persons are associated with a person -
f) any director or employee of -
any corporation of which the person is a director or employee; or
any corporation that is related to that corporation.
In other words an associated person can be one ‘s fellow employees. Surely that is an excessive definition. I can understand why an attempt has been made to try to cast the.net as wide as possible, but there are just too many people defined as associated persons under this clause. I suppose that I am picking the example which is the widest to illustrate the point, but the clause is very wide indeed. Presumably it excludes one’s friends who. are not otherwise relatives but includes one’s fellow employees. In a large company of thousands of employees that is really saying quite a lot. Presumably it applies also to large government departments. As we know more and more people are becoming members of government departments. Presumably they are all in association with one another under the provisions of this clause. I cannot see, although I would like the Attorney-General’s comment on it, how there can be any doubt that clause 1 1 applies to this one. So it would seem to have pretty wide ramifications. I invite the Attorney-General to discuss what is the intention and to state whether those ramifications are intended to be that wide.
-I wish to refer to one other clause at which I have had an opportunity of looking while the honourable member for Curtin (Mr Garland) has been speaking. I ask the Attorney-General (Mr Enderby) to look at the implications of clause 14 in relation to clause 111, which relates to the disclosure of interests. For the purposes of my argument let me accept the proposition that there should be complete disclosure. I believe that the old rules of fiduciary relationship should be observed and observed impeccably. There are instances, of course, when people do not observe them, and this is what the Bill seeks to correct. I still take the view that, dishonesty is not to be cured by legislative form. If people do not have a feel and instinct for honour I do not think any library of statutes will cure that. But that is beside the point.
We reach the absurd position where this clause deals with associated persons- and here it has a relationship to clause 1 1 1- the type of person who must disclose the interest. Let me give one illustration to the honourable gentleman Take the case of a stockbroking firm. One of the partners sends out a circular to people involved in his area of activity. Under this clause, what he would be required to do is to check with all of his relatives and with all of his employees to ask them what they have by way of investment. The ramifications of that seem to me to be quite appalling. The time that would be involved would be immense, the possibility of confusion significant and the possibility of error very grave. I will be saying a little more on that point when we come to clause 111.
What I would like to suggest to my friend is that he should delete paragraphs (a), (e), (f) and (g) from the definition and put in something to the effect of these words: ‘or under which the person or any person who is associated with the person by virtue of paragraph (a) benefits or is capable of benefiting’. I do not insist that the honourable gentleman embrace my suggested amendment. But I do make the observation that there will be very great areas of difficulty if the definition in the clause remains as it is.
– The honourable member for Moreton (Mr Killen) correctly drew attention to the fact that the language in clause 14 and clause 1 1 1 is broad, as indeed it has to be broad because of the abuses revealed by the Rae Committee. I might remind honourable members of the general recommendation of that Committee in this area, going to the question of a licence holder disclosing his interest in securities when making a recommendation. We have the example of corporations going behind the corporate veil. No one would argue more strongly than I do that the invention and development of the limited liability company have been a great engine for progress in the world over many years. But no one would argue or could argue more strongly than I that it has also been a great engine for fraud and deceit. Of course, the Rae Committee report tells us this, if we needed to be told. The problem of law really is to try to draw attention to the standards, lay down the duties and impose the standards on people so that if they are in breach of these standards so as to cause injury by the committing of a fraud, the people concerned will be guilty of some offence or at least be subject to some civil liability to the person injured. All that this legislation seeks to do is to bring this about.
We know that when we go behind the corporate veil we find a separate corporate identity made up of people who live together. Any lawyer on the other side of the chamber would know the difficulties of proving a representation that comes from a corporation when one is not in possession of the facts that lead to the creation of the authority of the person to make the representation on behalf of the corporation, notwithstanding provisions for discovery, interrogatories and matters of that sort. I was involved in a case in the Australian Capital Territory not so long ago that went to the High Court on that very issue, involving some of the very great corporations in Australia. With those difficulties of getting behind the corporate veil and finding out what is going on and whether certain activities are to the detriment of outsiders, law-makers like ourselves have to come along and give the injured person a better remedy than he has at the moment. That is what this legislation seeks to do. This legislation is broad, but so is every type of legislation of this sort that has ever been enacted. All legislation of this kind has been broad and the courts interpret it having regard to the mischief which they are intended to stop.
The honourable member for Moreton also referred to clause 13 (1) and talked about and criticised the word ‘member’. He said that the word should be changed to ‘conference exchange’ or an expression of that sort. We would suggest that there is absolutely no need for such a change. The use of the word ‘member’ in that context is clear and acceptable and there is no need for it to be replaced with the words conference exchange’. I remind the honourable member again that exchanges are required to be incorporated. With the exception of the Brisbane Exchange, all the exchanges are incorporated. I understand that the Brisbane Exchange has been dragging its feet for a while. When this Bill becomes law, as we hope it will, that exchange obviously will be assisted in its steps towards incorporation by the requirement that it be incorporated.
The honourable member for Curtin (Mr Garland) talked about the definition of associated’ in relation to clause 14 (f). The definition in clause 14 must be sufficiently wide to catch well practised schemes designed to disassociate persons from their misdeeds. I put this to honourable members: When one looks at this legislative scheme one sees 2 measures in the mind of the Government. One is customer protection and the other is protection of the investor- - consumer protection if one likes to use that expression. In devising a means of giving that protection by way of all these legislative steps, one has to take account of the different levels of some of the customers. Given the nature of the industry, some people are particularly vulnerable. We know that. Some are naive. Some have had no experience at all. On the other hand, others, particularly those who use the facilities of merchant banks and the city, are particularly sophisticated and experienced investors operating in and through great corporations, and need less assistance. The legislation seeks to take into account the difference between the great who do not need a great deal of protection and who can be expected to be able to employ expensive lawyers to guard their interests and the little person, the battler, the fellow who was deceived so badly some years ago and continues to be deceived from time to time, who needs protection. The legislation seeks to draw attention because of the different dealings that occur between those 2 types of clients, customers or consumers of the service.
We must bear in mind when looking at all the measures that the Bill also seeks to facilitate the free working of the market. This is where the rubbish is put and the lie is put to allegations of some kind of socialist monster. The legislation copies a model from the home of capitalism- the United States of America. The legislation is designed to take account of the fact that practices have grown up in the industry which do not allow the market to work as it should work and so correctly allocate resources into the best and optimum areas. It is designed really to facilitate the free working of the capital market in this country. I ask honourable members not to forget those 2 main threads that go through the overall cloth that make up this Bill.
Clauses agreed to.
1 ) For the purposes of this Act, a corporation shall, subject to sub-section (3), be deemed to be a subsidiary of another corporation if-
holds more than one-half of the issued share capital of the first-mentioned corporations (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital); or
A reference in this Act to the holding corporation of another corporation shall be read as a reference to a corporation of which that last-mentioned corporation is a subsidiary.
– I move:
In sub-clause (1), at the end of paragraph (b), add “(including any corporation that is that other corporation’s subsidiary by another application or other applications of this paragraph)”.
In sub-clause (4), omit “last-mentioned”, substitute “other”.
The first amendment to clause 16 is straightforward. It simply seeks to ensure that a chain of subsidiaries is also included in the area of protection. It is thought to be an improvement and I do not anticipate- and I hope I do not hear- any opposition from honourable members. I would be surprised if there were any opposition because it seems to put the clause in a better form. It is a drafting improvement. It seeks to omit the words last-mentioned’ where they appear in clause 16, page 14, line 32 and substitute the word ‘other’. As presently drafted it might be argued that the expression ‘last-mentioned corporation’ in line 32 refers to the word ‘corporation’ where secondly appearing in line 31. The amendment would make it clear that the reference is to the word ‘corporation’ where first appearing in line 31.
Amendments agreed to.
Clause, as amended, agreed to.
Clauses 17 to 33- by leave- taken together.
– I have a question in relation to clause 1 8. Why is it necessary to declare in any provision of this Parliament that it is the intention of any Act of this Parliament to exclude the provisions of any other State enactment when, if they are in conflict, the paramountcy section of the Constitution operates? I ask that question. I have never seen it put in this form before.
I turn now to clause 20 of the Bill. I deal first of all with 20 (2) (c). In doing so I have to go back to King Henry VIII to make my point. It is what is known as a King Henry VIII clause which, in years gone by, was inserted in Acts of the Imperial Parliament. It draws its name from the fact that Henry VIII used to make declarations having full legislative force merely by making a proclamation. It has always been vigorously resisted by those who walk in the Westminster tradition of Parliament. This is as close an approximation to a Henry VIII clause as I have ever seen. Please listen to it, Mr Chairman. It states that the Commission shall have various powers included in them being the authority to take such action, including the making of rules under section 283, as is necessary and available to it to enforce or give effect to the provisions of this Act. I ask the Attorney-General to consider, for example, that provision in relation to paragraph (g) of the same clause which deals with the promotion. It states:
Promote the establishment of a national stock market;
This Parliament has not the slightest idea in the world what action would be taken by the Commission to give effect to the promotion of a national stock market. Here we are being invited to put into this Bill a provision of that nature. I would describe it as quite exceptional. There has never been inserted a provision of that character into any other Act of this Parliament that I can recall in the 20 years that I have been here. I draw the attention of the Attorney-General to the wide nature of that provision. I would also invite him to delete the word ‘promote’ in clause 20 (2) (g) and to use the verb ‘encourage’. This is no mere quibble.
– I am listening.
– This is no mere quibble at all. Promote’ means that one takes an active, personal and proprietorial interest in what one is doing. ‘Encourage’ puts it in an entirely different way. Is it the Government’s intention to promote a national stock market and to run it as a promoter? This is the fear which is held, Mr
Attorney-General, by many people in the community and I invite him, as the nation’s leading law officer, to settle those fears. The AttorneyGeneral could settle them simply by taking out that one word and inserting another.
-I congratulate the honourable member for Moreton (Mr Killen) for at least, in his consideration of clause 20 (2) (c), getting away from the detailed comments and recommendations on this Bill as put forward by the Australian Associated Stock Exchanges. This was one that obviously came from the honourable member himself, as indeed has one other. I say this to draw into focus exactly what is happening in the Committee stage of this debate. Some of us have a document of 86 pages relating to about 86 or more separate clauses and sub-clauses of this Bill. They are detailed comments from the body that I have mentioned, the Australian Associated Stock Exchanges. It is no tribute to the members of the Opposition who are rising in this debate merely sycophants of the ideas in this document, because from the research that I have done I have found that there were 6 separate committees of the 6 stock exchanges around this country which have studied the Bill in detail and have come up with the sort of -
– Order! The honourable member will have to show relevance fairly quickly to the clauses we are dealing with.
– I am coming back to clause 20 which is one of the clauses under consideration. One of the recommendations is that in clause 20 (2) (f) the words ‘develop and’ be deleted from this paragraph so as to ensure that the functions and duties of the Commission are confined to those of a supervisory, advisory and regulatory . role. In clause 20(2)(g), which is under consideration, it is recommended that the word ‘promote’ be replaced by the word ‘encourage’. This recommendation is consistent with and for the same reasons as the recommendation made for the alteration of clause 20(2)(f). We have just heard the honourable member for Moreton parroting exactly what is written in one of those paragraphs I have just read.
The point I come back to, Mr Chairman- I am sure I will be in order now that I have pointed out the relevance of what I am saying- is that the 6 separate committees have had a number of members, let us say ten on each committee which is a total of sixty, who have been nit picking through this Bill. Some of the ideas are undoubtedly good but the Government has not yet had time to study them in sufficient depth. I said in my speech in the second reading debate- it is not anything new on what the Attorney-General (Mr Enderby) himself has said- that these ideas will be studied. The Bill is going to the Senate and will be coming back to this House. I stated in my speech as well that -
– Order! I have stopped other honourable members from referring to the second reading debate.
– I take your point, Mr Chairman. I was stimulated into making this comment because of the inane interjections members opposite have been trying to make to point out that, because the Australian Associated Stock Exchanges had taken some time to get this document into this place, now is not the time to hold up an important Bill for a recommendation such as deleting the word ‘promote’ and inserting the word ‘encourage’, which is suggested by the honourable member for Moreton. I repeat that there are 86 pages in this document representing about 86 such recommendations. I do hope the Opposition will be responsible enough not to go through each of those recommendations in the way it has just indicated to us.
-I think one must respond to the suggestion of the honourable member for Adelaide (Mr Hurford) that we are in some way sycophants of the stock exchanges. He then went on to make the very point of what we are about. We are the ones who protested about the fact that those who are most concerned in the most practical way- we think in particular of the stock exchanges- have not been given sufficient time to put final submissions to the Government. So, there is little option but for those of us who speak on this side of the House to do it for them. We know that certain Government backbenchers have been given information by stock exchanges, and for the first time that has been acknowledged. This ought to be before the Government because it is a matter for consideration by the Government.
Referring to clause 20, to which the honourable member for Moreton (Mr Killen) drew attention, he was correct in saying that subclause (2) (c) is one of the widest provisions that one could ever imagine. Is there not a group of Government backbenchers who are alarmed about the future of the institution of Parliament to which they belong? It seems to me to be most important that if this is to be the pattern of Government legislation Parliament will be very much bypassed. In reply to the debate on clauses 13 to 15 the Attorney-General did say that the
Commission that is being created is not a socialist monster. Anyone who read clause 20 (2) (c) in conjunction with the Australian Labor Parry’s platform could be forgiven for doubting the Attorney-General’s assurances, but at the very least if one reads the Bill in its entirety one finds that the Commission is an academic bureaucratic monster. When one reads clause 20 (2) (f) one really does wonder whether the Commission will not be in competition with another bureaucratic monster, namely, the Australian Industry Development Corporation. I think I should read paragraph (f).
– You supported that ‘monster’.
– I do not support another one being established in competition with it.
-You supported the AIDC Bill.
– I am not speaking in opposition to the AIDC, but I certainly am speaking in opposition to clause 20 (2) (f) which reads: develop and facilitate the opportunities for persons to participate in the ownership and control of Australian industry by means of collective investment schemes and improve the performance and efficiency of such schemes;
It seems far beyond the purpose of this legislation to have this Commission, with the wide powers given under clause 20, involved in developing opportunities for persons to participate in the ownership and control of Australian industry. There I would commend some of the recommendations from the Australian Associated Stock Exchanges because it is important that the Commission should be confined to facilitating’; it certainly should not operate in the very broad sense of ‘developing’.
Clause 21, which is relevant to my references to this quite possibly becoming an academic area, relates to the Governor-General’s power of appointment of persons to the Commission. It confines the Governor-General to appointing persons having requisite experience in or knowledge of industry, commerce, economics, law or public adminstration. It is the concern of those who are practitioners in this area that these be added together or that these be conjunctive and that the commissioners must have both practical experience and the academic qualifications which are required by clause 21. It would not be difficult for the Government to substitute in clause 21 (3) the word ‘and’ for the word ‘or’. After all, we are imposing on members of the Commission inordinate powers. Even if the Bill were worded more precisely these would be very great responsibilities, and one would hope that we would put them in the hands of persons who were qualified by practice as well as by academic qualifications to handle the positions.. I have no further comments on these clauses of the Bill.
-I would like the honourable member for Adelaide (Mr Hurford) to understand one thing about this debate. If I believe that a submission made on this legislation by a body which clearly knows a good deal more about it than certain members of this chamber is a worthwhile submission, I am quite prepared to consider it and argue it. I do not think the cause of proper discussion in this debate will be advanced by the honourable member for Adelaide expressing great frustration because the Opposition seeks to give this Bill some consideration. I was absolutely astounded to hear him remark a few moments ago that the Opposition members were behaving like sycophants. The honourable member said that of course the Government had not had time to consider the stock exchange comment and recommendations. That is precisely the point that we were making.
– Who said that?
-The honourable member for Adelaide said that the Government had not had time.
– He does not speak for the Government.
-He does not speak for the Government. Already divisions are appearing in the ranks of the Government over this Bill. The fact of the matter is that there are a few members of the Government Party who are starting to be a bit worried that this legislation is being rushed. If the honourable member for Adelaide was really faithful to what he said a few moments ago he should have come over to this side of the chamber and supported the second reading amendment that was moved by the Deputy Leader of the Opposition (Mr Lynch). I think that this Bill belongs to that category of Bills which the Government has decided -
- Mr Chairman, I raise a point of order. The last five minutes or so has been an exchange between 2 honourable members on opposite sides of the chamber. Nothing has been said about the clauses under discussion.
The CHAIRMAN The honourable member has been speaking for about 2 minutes. I remind him of what I have told other honourable members, and that is that they should speak to the clauses which are being discussed. I have allowed him a little lattitude, but cross-talk about how the Bill should be debated is not relevant to the clauses in the Bill.
– I am grateful for your ruling, Mr Chairman. I would like very quickly to add to what the honourable member for Moreton (Mr Killen) said about clause 20(2)(c). He described it as a Henry VIII clause. I think that clause 20(2 )(c) illustrates that to a very large extent this legislation must have been drafted in great haste because it has all the indications that the draftsmen and the Attorney-General thought: ‘Maybe there is something that we left out; so we will clothe this Commission with a bit more power’. The honourable member for Balaclava (Mr Macphee) has drawn attention already to the criteria which ought to govern the GovernorGeneral’s determination when he appoints the members of the Commission. I support what the honourable member said. Probably the most important single act that might be performed under this legislation is the appointment of the personnel to the Commission. I would hope, in view of the acknowledgment that the AttorneyGeneral now gives by nodding his head, that some consideration will be given to an expansion of that definition.
-The Opposition does not object to the establishment of this Commission per se. What we do want to ensure, however, is that the personnel employed and the objectives of the Commission will be rationally related. In New South Wales, for example, there are about 300 public servants involved in the New South Wales Corporate Affairs Commission. On the basis of the exercises performed by the present Government in relation to its Public Service expansion in the last 2 years, I think we have every reason to anticipate that at least 300 people will be involved in this Commission. In the definition which has been given concerning the appointment of officers to the Commission I would not like to see the criterion ‘knowledge of or experience in public administration’ used as a means of bringing into the Commission a substantial number of public servants, thereby diluting the Commission’s very real need to ensure that the people at the top are in fact, as they are in the case of the Australian Industry Development Corporation men who are well experienced in the field of commerce, industry and finance.
– The remarks made by honourable members about clause 21, and in particular sub-clause (3), concerning the qualifications of members of the Commission are relevant and are very much in the Government’s mind. There can belittle doubt that the people who make up this Commission will have an extremely important role to play in the industry and the effect that the industry has on investment generally in Australia. Let no one be under any misapprehension about it. The Government appreciates that fact fully and when the time comes to find those people every effort will be made to find those most suitable for the job. They will have to be acceptable to the industry and that is appreciated. They will have to be men or women with a great breadth of experience and understanding. That is why the various qualifying features were written into the Bill.
Clause 21 states that a person shall not be appointed to the Commission unless the Governor-General is satisfied as to his or her knowledge in industry, commerce, economics, law or public administration. The words are flexible. They are very wide. I say in passingplease do not misunderstand my saying this because I know it is understood that I represent Canberra, which has a lot of public servants- no one should under-estimate the qualifications of senior public servants. They are extremely capable and competent people. Because of the nature of their work they are often able to take a broad view of a whole industry that people in the industry or a particular part of it have difficulty in taking because their experience has not given them the breadth of view that sometimes a senior public servant has. That provision is there only to give flexibility and no one would appreciate more than I the fact that the personnel must be acceptable to the industry. Otherwise the whole thing would not function at all. A number of other points were made. Some concern was expressed, I think by the honourable member for Moreton (Mr Killen), in his usual flowery language.
– ‘Elegance’ is the word you were seeking.
– All right, if the honourable member wishes. The honourable member for Moreton referred to clause 20 (2) (c) as being a Henry VIII clause. I would suggest that it is not, although it bears some such features. One has also to take into account without departing in any way from the sovereignty of Parliament and the important role that Parliament must play and must continue to play and the emphasis that this Government gives to making it play a role and to making it work better- I do not want to get sidetracked into the role of Oppositions and governments in this unfortunate debate- one also has to recognise that the modern world is so incredibly complex, especially in an industry like the securities industry, that the House of Representatives and the Senate are not really equipped, because of their history, to go into some of these practical bread and butter day-to-day matters.
-No one has ever argued that the Commission has to be an SEC type body. I have not heard anyone really argue that seriously here. The argument seems to be around the size of the Commission, the extent of its powers or the choice of language used in creating those powers. No one has ever argued that there should not be a statutory corporation type body beyond the Parliament with its day-to-day administration of the system and that it should have a rule making power.
The rule making power is set out in clause 20. One has to realise that it is a kind of statement of intent as much as anything else. The language in the clause hardly enlarges the power. It is really a preambular approach. This is becoming increasingly common with parliamentary counsel these days. Of course we know what clause 20 says. It provides that the Commission shall have such functions as are conferred on it by this proposed Act. If the Commission goes outside of the provisions of the proposed Act the normal principles of ultra vires apply. There may be actions in the courts which can declare invalid a rule making exercise of the Commission, if it is outside of the scope of the proposed Act, and bring it crumbling to the ground. There is surely no problem there.
Clause 20 (2) states:
It is the duty of the Commission to the extent to which the Parliament has power to confer that duty on the Com-, mission.
Again there is strict compliance with an attempt to be legalistic and proper to ensure adequate protection of persons who invest in securities of prescribed corporations. There is not a conference of power there so much as a conveyance by the Government to the Commission of what the Government thinks the Commission should try to do, namely, to protect persons who invest in securities in corporations. In other words, if these provisions were not there the members of the Commission might well say: ‘Where do we go to find out what we are supposed to do?’ We know we can do some things but where are we to go in this Act to find out what we are supposed to do? What does the Government have in mind for us?’ All clause 20 seeks to do is to assist in that regard.
In the Industries Assistance Commission Act, with which honourable members would be familiar, is a clause which sets out what the Government hopes the IAC will bear in mind as it goes about carrying out its function. Clause 20 provides the same sort of provision. Clause 20. (2) (b) states that the Commission shall maintain effective surveillance over the operations and activities of certain organisations and persons and sub-clause (c) is almost an exhortation to the Commission, I suppose, to be vigorous and active in its work. That is really all that provision does. It does not give the Commission any extra available powers. It states: -take such action (including the making of rules under section 283) as is necessary and available to it -
In other words the Commission is to act within its powers and the power comes from the proposed Act. It is the proposed Act that we are considering now. As I said, the ultra vires principle stands behind that so it is not a Henry VIII clause. It is ridiculous to suggest it, although it sounds elegant to do so, as the honourable member for Wakefield (Mr Kelly) said a moment ago. Another aspect also comes into the category. I see that my good friend the honourable member for Moreton has left the chamber. I suppose he has something better to do. He made something of a word that he found going through the Bill, as he is going through it now for the first time, it seems. He found the word ‘promote’.
– That is very ungracious.
– Why, because he is not here?
-No, to say he is going through it for the first time now.
-That is the impression he gives me. Is it not the impression he gives you? Clause 20 contains a number of sub-clauses. If honourable members have read the Rae Committee report they will know that the sub-clauses are almost all taken right out of the Rae Committee report; certainly (f) is and I am almost certain that (g) is. ‘Promote’ may not be a lawyers’ word. It is synonomous for practical purposes with ‘encourage’. To suggest this nasty thought that in some way there is a proprietorial interests, that in some way this Government wants to take over things when all it is doing is bringing into being a body that will regulate this industry in a way that will promote the national interest, the public interest and the interest of investors, to suggest that just because the Commission is called upon to promote the establishment of a national stock market there is something wrong with the word, is stretching the English language. If the honourable member wants to take out ‘promote’ and insert ‘encourage’ I would not quibble with him. But I suggest that we are wasting time to talk about it. He is wasting time to raise the subject. ‘Promote’ means to encourage in that context and no one would argue otherwise.
-I want also to take up briefly the suggestion of the honourable member for Adelaide (Mr Hurford). I have 3 analyses of this Bill including an analysis of this clause and I have discounted most of the suggestions made in them. But I think some have value and are worth being put to the Attorney-General (Mr Enderby). I think in relation to this clause he is addressing himself to the questions as is proper and I commend him for that. For the honourable member for Adelaide to suggest that we should just jam the Bill through without examination and justification is really letting the cat out of the bag as far as the Government is concerned. We all heard the Leader of the House (Mr Daly) say a while ago: ‘You have had it for 90 days’. We have not had it for 90 days because the AttorneyGeneral ‘s amendments to the many questions that I have raised were given only yesterday afternoon. It was only then we knew that he did not propose to change anything in clause 20 or indeed the other clauses on which we take issue. So I think that it is fair to put that on the record. It is not a question of delaying the legislation. Damn it all, what is a day or two in a matter involving a Bill of this scope and considering the delay there has been?
I go back to some of the comments the Attorney-General has just made. What he said perhaps has some validity, but at the beginning of clause 20 (2) it states:
It is the duty of the Commission -
That wording tells the Commission what to do. It is not, as he implied, a sort of outline or a bit of encouragement to the Commission to look up this clause to see what it should be attending to. It says: ‘It is your duty to do these following things’ not ‘if you feel like it’.
– Would you argue that it should not be?
– Let me continue because the Attorney-General will have the right of reply if he wishes to exercise it. The clause, having stated that it is the duty of the Commission, uses certain words. I point out here that the AttorneyGeneral’s first line of defence, if I might say so, was that we should not take these words too seriously.
– Not legalistically.
-The Attorney-General said that they appear in the Rae Committee report and after all this was only an indication to the
Commission what to do. I have already pointed out that it is charged with duties which include:
Develop’ is a word which conjures up in some minds a fear of action by this Government. The Attorney-General may say, as he has done, that that is not the intention of the Government but if this Bill is passed it will be the law whatever his intention and it will become a question of what will be the real objectives of the Government. I can assure the Attorney-General that some members of the Opposition have great and grave doubts about that. In paragraph (g) the word promote’ appears. It is the duty of the Commission to:
How is one to regard that provision when the first objective in the Labor Party’s platform calls for the nationalisation of large sectors of Australian industry? The Attorney-General can smile but he knows that is the objective. He knows that it refers to banking and to finance. We have been through this aspect about 1000 times and it cannot be denied. The AttorneyGeneral says that ‘promote’ in this sense really means encourage. That is one meaning of the word, but it has another meaning which is equivalent to the words ‘set up’. We are fearful of that meaning and it is not enough for the Attorney-General to say he does not believe in that meaning because, as he knows- I say this with respect- his assurances as recorded in Hansard are not law. What is passed in this Bill becomes the law. I accept the Attorney-General’s assurances without doubt but I say that they are inoperative and do not have any effect.
I suggest that this provision should be looked at. If the introductory words were ‘The Commission ought to have these matters in mind’ I still would not be happy, but it would be a deal weaker than saying ‘It is the duty of the Commission’. I assure the Attorney-General that the Opposition is concerned about this aspect. He talked about its being a statement of intent as though, somehow, that was of less importance. He said that if the Commission went beyond the powers, that would be ultra vires. I do not think he said it, but obviously that would be subject to challenge and this is exactly what we are concerned about- the powers being given to the Commission. We are not presupposing that it will be ultra vires; we are concerned with whether its powers are too wide and will be used by the Commission, with the Government’s support, to make incursions that are unjustified but are in accordance with the socialist objective. This is a matter of very clear concern.
The honourable member for Hawker (Mr Jacobi) is making noises of disbelief. He is entitled to do so, but I assert that there is much fear in the Opposition that that is the true intention. There is a lot of fear in the Opposition and a lot of fear out in the community. What we are considering in this and many other clauses is not that there should be some power but where the limit of that power should be. We want to see a clearly defined limit. It is not good enough to say that these words were included in the report of the Senate Select Committee on Securities and Exchange- the Rae Committee. After all it made recommendations in non-legal language. This clause should be amended and made clear. We ask that this Bill and other Bills that the Attorney-General brings forward be clear so that people know what is the law and what is the intention. There should be no doubts about that.
-I should like to add to the comments of the honourable member for Curtin (Mr Garland) regarding paragraphs (f), (g) and (j) of clause 20. The Attorney-General (Mr Enderby) no doubt has heard of Parkinson’s law. His Government has been an avid practitioner of that law during the last 2 years, consequently I honestly question the present formulation of this clause as described in this text. I again emphasise the point made by the honourable member for Curtin, namely, that whatever the Attorney-General may tell us it is not necessarily the law of the land although perhaps he would wish it was at times. Therefore to suggest that this Corporations and Exchange Commission is going to ‘develop and facilitate the opportunities for persons to participate in the ownership and control of Australian industry by means of collective investment schemes and improve the performance and efficiency of such schemes’ would lead me to suggest one of two things: Either- and this would be a very naive approach- that this Commission is, going to accept the present finance market of Australia, the insurance industry and various other means by which individuals and collective enterprise may invest in stock exchanges and the purchase of shares, debentures and so forth; or, alternatively, that this Commission will set up a new, and in other words, a rival finance organisation. We have seen, in the case of the National Investment Fund, which we debated recently, that this is a trend which clearly runs through the Government’s mind when it comes to matters of national finance. There is no evidence to suggest that the Government is prepared to use the existing market structure. There is considerable evidence to suggest that it wants to set up a rival machine at the insurance industry level, at the banking level and in the total money market structure of Australia. We, therefore, ask the Minister to clarify once and for all exactly where the Government stands on this point.
The finance industry in Australia is viable- at least it was viable when the economy was in a decent shape. However, as we have seen during the last 2 years in particular, some companies have been forced to go to the wall. In normal circumstances the industry as a whole is producing, approximately $700m a year for capital. In terms of the total capitalisation of Australian industry that is not great because the institutions- the large financial bodies including the banks and insurance companies- have always carried the largest section of the demand. I should like the Minister to explain that more fully. I should also like him to explain whether there will be room for State stock exchanges because in paragraph (g) the concept of promoting the establishment of a national stock market would suggest that this is perhaps but another means of centralising control in Canberra- again a basic policy of this Government. In the United States of America, for instance, there is a stock exchange in New York as well as an American Stock Exchange. I presume there are other stock exchanges in some of the other large cities of the United States. I simply want to know whether the proposed national stock market will be established with the full support and co-operation of existing State stock exchanges, or does the Government see this as an additional entity to be added to the existing financial infrastructure? Paragraph (j), as I see it, is closely related to paragraph (f). Paragraph (j) states that as soon as practicable after the commencement of this Part, the Commission is to inquire into the management, activities and performance of mutual funds, unit trust and other collective investment schemes. I take it that under the existing provisions of the Commonwealth Constitution this means that the Commission will have power over existing State corporate affairs commissions and so forth which are already doing precisely this sort of thing. Again I should like to have a full explanation from the Attorney-General as to whether or not this is designed simply to establish another vast bureaucratic machine to compete with existing State instrumentalities.
– I have a question to ask the honourable member for Bradfield (Mr Connolly). Why is it that governments are requested to protect the public? Perhaps I could give him a good simile. For 3 years in this Parliament I attempted to get a Federal Act to cover the insurance field because it had failed to regulate itself in the same way as the stock exchanges. Only 3 months ago there was the collapse of the Northumberland Insurance Co. Ltd in my home State of South Australia. That company had branches throughout Australia. It collapsed because the directors never had enough financial acumen to place their investments in a proper order to protect their policyholders. What was the result of that collapse? One morning thousands of policyholders found that they had no coverage whatsoever. I suggest to the honourable member for Bradfield that the Acts of this Parliament in that area have been colonial in content. The Act in the United Kingdom gives complete powers regarding investment. For what purposes are those powers given? It is to protect policy holders. This Government and the Attorney-General have a right to protect the people, and that is precisely what this Bill sets out to do.
– I invite the Attorney-General to consider the ramifications of clause 32 in relation to a number of issues. Under clause 32 a meeting of 3 members of the Commission can delegate to an officer of the Commission- qualifications unstated; sense of judgment unknown- power to prohibit trading of securities on a stock market under clause 60; stop trading for the day. The social consequences of that seem to me to be immense. What if the officer made an error of judgment? It would be bad enough if the Commission made an error of judgment, but if for some reason or other the officer took the powers under clause 60 and said: BHP shares will not be traded iri for 2 1 days ‘ -
– It is exactly the opposite.
-No, it is not.
– Yes, it is exactly the opposite. You have left out the ‘not ‘.
-The clause says ‘other than’.
– I am indebted to the honourable gentleman. Let me therefore deal with the one that goes before.
– Change course.
-No, not at all. The Government has made absolutely no effort to put into this Bill appropriate -
– Which one are you on now?
– J am still on the same clause because it has the same relevance. I deal now with the fact that the Commission cannot delegate and that it holds power to suspend. What does the Attorney-General say about the position where the Commission makes an error of judgment? No appeal lies whatsoever, and this trumpety little amendment, this spurious amendment -
– Which one?
-The one which is in contemplation and which states that certain decisions of the Commissioners are not to be reviewed except as provided by the Administrative Appeals Tribunal Act. What impertinence on the part of the Government to come into this chamber and to put into a Bill a provision relating to an appeal to a body that is not in existence. This is disgraceful.
– You will oppose that, too.
– Of course you will. You oppose everything; it is in your nature.
-Indeed not. I had implored -
– When did you last support anything?
– I had implored publicly years ago an acceptance of the idea of establishing a proper appeals tribunal.
– You say the same thing about this, but when it comes along you oppose it.
– Of course you do.
-No, not at all. The honourable gentleman’s rapport will not rescue him from the agony that he is entitled to suffer in relation to this matter. No appeal will be available where a grievous error of judgment is made by the Commission. The Attorney-General will not heed my words but I wonder whether he will heed the words of the authentic voice of a great Englishman, Lord Denning, in the first Hamlyn lecture. These words should be carved in some form or another in the office of every civil servant in Australia. This is what Lord Denning said:
It should be clearly understood that although the High Court has some degree of control over the tribunals it is not such as to enable it to correct many of the faults or injustices which may arise, unless the Statute gives an appeal. The High Court proceeds’ on the footing that if Parliament had thought fit to entrust jurisdiction on all these new matters to new tribunals without any appeal from them, then, so long as the tribunals do not exceed or abuse their jurisdiction, the High Court should not interfere with them.
If a tribunal should come to a wrong conclusion on the facts or, indeed, if there is no evidence on which it could come to its conclusion, the High Court cannot interfere; nor, if the tribunal comes to a wrong conclusion in point of law can the High Court interfere. So long as the tribunal keeps within its jurisdiction, and is not guilty of any flagrantly unjust procedure, its decision is final both on facts and the law.
For all practical purposes the High Court in Australia, in relation to this Bill, is placed in a comparable position. I implore the AttorneyGeneral, as the one whom I have described as the chief law officer of the country, the parens patri of the country: For heavens sake, provide some appeals provisions that are readily identifiable and will adequately safeguard against the improper use of very grave powers.
– The honourable member for Moreton (Mr Killen) made his first mistake when he said that there was power to delegate. Now he has made his second mistake. If one looks at clause 60 one sees the gist of his mistake. The Commission can prohibit trading only in a specified security, not in the lot, and that can be overriden by the Government. What is wrong with the Government being the final court of appeal?
– No judicial inquiry?
-Not in a situation of that sort. It is typical of Opposition members that they try to bring Government into disrepute. Government has the final sanction behind it, a sanction far more effective than any court or any commission. It has the sanction of public opinion, because it has to face the people at election time. Therefore Government always has to do the right thing. There is no better sanction than the whiplash of public opinion behind government. Honourable members opposite forget that. They always forgot it when they were in government. We never forget it.
The honourable member for Moreton is about to leave the chamber, having made his second consecutive mistake. What is one supposed to do? We go through this ritual farce of the honourable member, having read the Bill for the first time now, although it has been available for months and having known for years that there was the need for such a Bill, coming into this chamber and having the gall to say that he wants to go through the Bill and ask: ‘What about this section? What about this? What about something else?’ He is exposed for his hypocrisy. He goes on with this nonsense. Is it any wonder that we do not hold him in any great respect and that his credibility is low?
-That helps us a bit. That would be a compliment.
– Yes, that is quite right. I have put the point to my honourable friend from Moreton that he has made his second consecutive error. I wish that he would stop wasting time.
Clauses agreed to.
Clause 34. 038013705 (4) Clause 34, in its present form, staffing of the Commission when it is created. The clause that we seek to amend provides that the Governor-General, in accordance with a recommendation of the Commission that has been approved by the Attorney-General, may regulate the salaries, conditions, etc., of the staff. The Government considers that it would be better if we bring the Commission within the normal structure of the Public Service Board. That is the reason we have moved this amendment. I should mention that some of the other amendments are consequential upon this one. The advantages of this provision are that it enhances the prestige of the Commission and it lessens the opportunities for, shall we say, patronage or jobbing or that sort of thing which is of concern to any member of this Parliament. It brings it within the wellrecognised system of career opportunities for staff and within the compass ofthe Public Service Board. I commend the amendment to honourable members.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 35 to 44- by leave- taken together.
-I ask the Attorney-General (Mr Enderby) whether, having regard to the enormous powers which will be vested in the Commission and to the unsatisfactory absence of an appeal against its decisions except the ultimate Government control to which he has alluded, he is totally satisfied with the disclosure provisions of clause 39. Is he satisfied that it is sufficient simply to inform the Commission? I ask this in no querulous sense and, to my knowledge, my comments do not coincide with the comments made by any stock exchange association or any other vilified vested interest group. I simply inquire of the Attorney-General whether, having regard to the extraordinary powers of the Commission, it is a satisfactory state of affairs, for example, for a member of the Commission who has a substantial financial holding in a particular class of security to disclose his interest. I ask this question not frivolously but in the light of the attitude that the Attorney-General’s own Government takes on the question of disclosure of interests. In the interests of consistency in the Government’s approach to the disclosure of interests by persons who can be said to have a fiduciary interest in a matter, is it sufficient merely for the Bill to require that the commissioner shall inform the Commission of the interest that he holds? I would be interested to hear the Attorney-General’s comments on that.
Mr ENDERBY (Canberra-Attorney- General (17)-I consider that the provision is sufficient. The obligation is there to disclose the conflicting interest and a very heavy penalty- $2,000 or imprisonment for 6 months- is provided for non-compliance. The clause goes beyond that and deals with other relationships that otherwise might be difficult to prove. The honourable member for Bennelong (Mr Howard) may be wondering what follows the disclosure. I put it to him that 2 things suffice to ensure complete protection. The first is the quality and standard of the Commission itself and the job it has to do. The second is the power of government in the ultimate resort and the power of the Governor-General acting on the advice of government if necessary to take appropriate action. But more important than either of those things is the fact that one of the amendments that I will be moving will change the part that takes out the prerogative writs. I do not know whether the honourable gentleman knows what I mean. I think he has studied law. The writs of prohibition, certiorari and mandamus will now be part of it, apart from and in addition to where they are enshrined in the Constitution. In a situation of conflict of that sort, with its obvious breach of natural justice, the prerogative writs obviously would be applicable.
-At the risk of asking a question and being greeted with incivility, I ask the Attorney-General (Mr Enderby): What is the position where a person does not respond to a request to appear before the Commission at a hearing? A heavy penalty is to be visited upon a person in such circumstances.
– What clause is this?
– I am taking clauses 40 to 43 in globo. It is very proper that there should be such a provision in relation to a hearing, but I inquire of the honourable gentleman: Where does the onus rest with respect to ‘reasonable excuse’? Does it rest upon the Commission to show that the person absented himself or herself without reasonable excuse, or does the onus rest upon the individual who stands in prospect of being penalised? My second question is with respect to sub-clause (2) (a) of clause 43 which reads:
A person appearing as a witness at a hearing before the Commission shall not -
The Attorney-General will acknowledge the fact that some people decline to answer questions on a variety of grounds, not the least of them being that to answer the question may incriminate them. If that be the case, then this is a very significant amendment to what is the substantial common law position and the statutory position in many instances.
Beyond that the question of privilege arises. It is not the person’s privilege. Take the case of a solicitor who appears before the Commission and is asked a question dealing with his client’s business. It is not his privilege; it is his client’s privilege. He is in no position to waive it. In what circumstances does the Attorney-General envisage he would be obliged to anwer the question? Plainly, no Commission properly instructed in proper procedures would press a person in such circumstances if he said: ‘I decline to answer on the ground that it may incriminate me or that the information has been given to me in privileged circumstances’.
– The answer to the query raised by my friend the honourable member for Moreton (Mr Killen) is that the obligation exists only where there is an absence of reasonable excuse. He asked me to put my mind to it. I would have thought that ‘reasonable excuse’ certainly would include a situation of privilege such as he described or the self-incriminatory aspect, although one has to take into account also that there are plenty of examples in our law going back many years- I am thinking in particular of customs and excise type law- where because of the nature of the situation burdens of proof are put unashamedly on the accused and all sorts of prefatory averments exist. My honourable friend knows the extent of them. They have always been discomforting to me, as I am sure they have been to him; but they have never been challenged.
As I read the language of clauses 40, 41, 42 and 43, a situation is being created that is consistent with the best principles of natural justice. Of course, if something went wrong- from time to time something goes .wrong in the courts; a magistrate or judge may make a mistake- there is provision for an appeal and for the mistake to be corrected in the final resort by the exercise of the royal prerogative if it becomes sufficiently serious. There is a point that is relevant for me to put to my friend. He mentioned the Administrative Appeals Tribunal measure which is referred to in this Bill. I hope that in the very near future- long before this measure proceeds very far in the Senate- to introduce it into this House, and the honourable member for Moreton and I will probably be confronting each other again. While he says he applauds the measure he then goes on to argue why it should not become law.
– I applaud the principle.
-The honourable member always does and he argues why it should not become law.
– That is ungenerous of you.
– I am sorry, but it is true. It has been the experience of the last 2 years. That measure, when it comes in, will seek to give effect to the recommendations of the Bland Committee report on the best way in.which to achieve- dare I use the word- justice in situations of this kind. I hope that it will have the unanimous support of this House. With the inevitable rough passage that this Bill will have from the honourable member’s colleagues in the Senate, it is certainly my intention that the other Bill will be in a position to take its place alongside this one at the appropriate time. We will then have the emergence for the first time, when the 2 measures operate together and when the Administrative Appeals Tribunal begins to -
– That was the Kerr recommendation.
-No, I am talking about the Bland report. It followed the Kerr report. The recommendations of the Kerr report would have resulted in too much of a romp for lawyers, we thought. I think the honourable member will like the Bland Committee report. There will emerge for the first time in Australia a coherent body of administrative principles. It will not necessarily be administrative law, although it will be legal. It will be a body mainly of administrative principles which will give effect to sure minimum standards of fairness between parties affected by situations such as those referred to.
-There is one aspect of this clause which interests me. As a former chairman of the Public Accounts Committee, I am sure that the Attorney-General (Mr Enderby) will be kind enough to forgive me if I bring this matter to his attention. It has been noted that clause 34 (2) reads:
The Chairman of the Commission has all the powers of, or exercisable by, a Permanent Head under the Public Service Act 1922-1974 so far as those powers relate to the branch of the Australian Public Service comprising the staff referred to in sub-section ( 1) as if that branch were a separate Department of the Australian Public Service.
In clause 35, as one would expect, there is reference to the fact that moneys payable to the Commission under this or any other Act shall be collected and received by the Commission on account of, and shall be paid into, the Consolidated Revenue Fund. Clause 36, in dealing with the Commisssion furnishing information to the Attorney-General and the Department, states:
I am wondering how the Audit Act affects the Commission and whether the commissioners are affected as are all other departments and permanent heads who are conscious of the impact of the existence of the Auditor-General of the Commonwealth. The Minister has set out in his memorandum quite explicit comments in relation to the audit requirements relating to corporations.
– To which clause are you referring?
– Clause 36 which is set out on page 23 of the Bill. I have referred to the chairman of the Commisssion being treated as a permanent head. Clause 35 provides, as one would expect and anticipate, that all moneys payable to the Commission shall be collected and received by the Commission on account of, and shall be paid into, the Consolidated Revenue Fund. Clause 36 deals with committees of either House of the Parliament which would include, for example, the Public Accounts Committee. I am asking where within the Bill is there reference to the effect of the Audit Act and to the AuditorGeneral? Has the Auditor-General and his office been excluded from a relationship with the Commission which would be similar to that which he would have with all the other departments of State? I point out that on page 43 of the explanatory memorandum the Attorney-General has stipulated quite stringent standards in relation to the audit requirements for the corporations. As one would expect, those requirements relate to State and Territory legislation, as has been mentioned, except that an auditor of a registered corporation will need to be registered under this legislation. The memorandum refers to the definition of ‘registered auditor’, and then goes on to say:
The function of registering auditors is to be vested in the CEC . . . The qualifications required are in line with those existing in State and Territory provisions except that a degree or diploma from a College of Advanced Education is recognised.
It seems to me that it would perhaps be reasonable to expect that somewhere in the Bill there would be clarified, in the light of all of these circumstances, the relationship between the Commission and the Auditor-General who is answerable, after all, to the Parliament in his annual report. I would be grateful if the AttorneyGeneral would let me know whether that is envisaged, whether he would consider an amendment to the Bill having that in mind, or whether he considers it to be quite unnecessary.
-The latter part of what the honourable member for North Sydney (Mr Graham) said is the answer to his question, namely, that it is unnecessary. The situation described by the honourable member as it appears in relation to those clauses is part of the public account and is automatically picked up in the Auditor-General’s role and the Act under which he operates. It is not necessary to spell it out in this Bill again. It is automatic; it just comes about. The answer is contained in the final question which the honourable member posed, and that is that it is not necessary.
I go on to put to the honourable member that there is always a grey area in the relationship between a Minister and his department, the relationship between a permanent head and his department and indeed between a Minister and his permanent head. I smile as I say that, having had, I think, 7 permanent heads in the short time that I have been a Minister. The relationship depends on the department, of course, and the statutes for which the department or the Minister is responsible. The chairman of the Commission is to stand in relation to the Commission in the same way in which a permanent head stands in relation to his department, and that means that it is his responsibility to see that the department- in the case of the chairman it will be the Commission- works properly. The honourable member went on to direct attention to clause 35. I think I have tried to answer his query in relation to that clause because the money goes into Consolidated Revenue, becomes part of the public account and is automatically picked up by the Audit Act.
The last point raised by the honourable member concerned the committees of both Houses of the Parliament. I did not read into the honourable member’s question that that was in any conflict with his main question. Indeed, I believe that he applauds the general principle behind the proposal. If social circumstances require that a Commission of this sort be set up to regulate the industry in the interests of the capital market and the consumer operating in the industry and if that is outside the scope of Parliament in the direct sense, it is then impractical to do it. No one is arguing otherwise. The task then is to make the Commission responsible to the public interest through the elected body, which is the Parliament. The best way- to do that, of course, is to relate it to the Minister, to the GovernorGeneral, to the Parliament as a whole and, indeed, to the committees of the Parliament so that they are all then involved in that situation. In the impossible event, with a Labor Government, of having a perverse Minister -
– I beg your pardon?
– I will not repeat it. If for some reason or another there was a malicious Minister or an incompetent Minister -
– But you said that they do not exist.
– I said not in a Labor Government. If there was such a person and it was proper on the evidence for him to take such action and call for a report and he was not doing so, it would be open for a committee of the Parliament and for the Parliament as a whole to do it. So there are adequate safeguards in the legislation for the proper role of Parliament to continue to be played.
Clauses agreed to.
Clauses 45 to 47- by leave- taken together.
-I refer to clause 45. When we were discussing the definitions earlier I referred to the need for a definition of what is a public company. That does not appear in the definitions in clause 3 and, as far as I can see, it does not appear anywhere in the relevant Part. I presume that it is not in the Bill. There would seem to me to be a need, considering the importance of the matter, for a definition of the words ‘public companies’. It may be that the Attorney-General (Mr Enderby) will say that the words ‘public companies’ are defined in some State legislation. I think that he has said that in respect of this or another matter. One wonders then what would be the position if the States concerned decided to change their definitions, which, of course, they are using for other purposes.
– Is the honourable member’s question: Where is the definition of ‘public companies’?
-Yes. If I may say so I also raised questions about the definition of ‘current assets’ and other matters but did not get a reply. However, that debate is over, I suppose. I turn to sub-clause (2) of clause 45. We are, of course, dealing with the registration of corporations. Sub-clause (2) states that this Part does not apply to a public statutory corporation. Why not? Why should a public statutory corporation get that sort of benefit? Why should the Australian Industry Development Corporation not have to report, particularly- I say this deliberatelywhen one takes into consideration the prospectus that was issued, which I believe was a disgrace because of the paucity of information in it? I very much doubt whether any State companies office or, indeed, the office concerned in the Australian Capital Territory would have accepted it if it had not been put forward by a public corporation. One would have thought that there was a strong argument in favour of requiring public statutory corporations to disclose the sort of information that is sought elsewhere. Why should they be placed in some exclusive position? Of course, we all know how difficult it is to get any information about the activities of the AIDC. I am thinking of that body in particular, but, of course, there are others and in view of the way in which the Government is going, there will be a lot more. I think that that provision ought to be deleted. It is perhaps typical of provisions of this kind- put forward, I might add, by governments of all colours- that these sorts of exemptions are made. I do not agree with them being made. I would like the Attorney-General to reply to those 2 comments in particular.
– I wish to reply briefly to the remarks, of the honourable member for Curtin (Mr Garland). There is a definition of the words public company’ in clause 7. It may have escaped the honourable member’s attention. Public statutory corporations, which was the other aspect of the honourable member’s remarks, find themselves in different situations but generally they are not trading companies or corporations.
– What about the Australian Industry Development Corporation?
– I will come to that. I am referring to Trans- Australia Airlines, the Commonwealth Trading Bank and bodies of that sort. But operating as they do pursuant to their normal statute, they are invariably required to report to the Parliament and a Minister is always answerable in the Parliament in respect of them. We have just maintained the long established practice, although I believe that a situation could arise in the future in which one might want to depart from the normal practice. We have just maintained the long established practice that, with those safeguards, the mischief does not exist I think I am correct in saying that the various State Acts that set up corporate affairs bureaus similarly exclude the public corporations from their ken. So in that sense we are giving the State rightists some encouragement.
-I wish to take up the point that the Attorney-General (Mr Enderby) has made. I put to him the view that that is not a good principle, State rights or otherwise. I have referred, perhaps somewhat bluntly to a particular instance which I think proves my case, that is, the prospectus of the Australian Industry Development Corporation. If that is not enough evidence, I do not know what is. I ask for that matter to be looked at because we have now been told that this Bill will go to the Senate and apparently will then come back to this chamber, although I do not know how long it will be here on that occasion. I take up the AttorneyGeneral’s other point about the words ‘public company’ being defined in clause 7. 1 referred to a second aspect, namely, what happens when the law in those States is at variance or is changed. It is, after all, a law which exists for somewhat other purposes. I am not pressing the point particularly strongly, but I put it to the AttorneyGeneral that a definition of the words ‘public company’ would seem to me to be prima facie highly desirable.
-I want to make an observation on the point regarding the Australian Industry Development Corporation. Surely the Attorney-General (Mr Enderby) will acknowledge that it is a fact that it is a corporation which has a vast trading character. Why should it be accepted in this statutory form? The explanation that the Attorney-General has given is one that does not seem to me to be in the least acceptable.
-I would like to pursue briefly the point just made by the honourable member for Moreton (Mr Killen). The justification that the Attorney-General (Mr
Enderby) has given for excluding public statutory corporations is that the Government is merely following the normal practice in respect of these bodies.
-No, I went beyond that. I said that there is no evidence of any mischief there.
-I am not suggesting that there is any evidence of mischief. I am merely saying that the justification given by the AttorneyGeneral for excluding public statutory corporations is that that has always been done in the past and there is no strong reason for departing from the practice. I put to the Committee that the nature of the Australian Industry Development Corporation is something quite different from that of the normal public statutory corporation, such as, for example, the New South Wales Metropolitan Water Sewerage and Drainage Board. I can understand the Attorney-General’s argument in respect of the exclusion of a public statutory corporation such as that, but I do not think that it can seriously be suggested that the AIDC, which is a public statutory corporation, comes out of the same stable as the New South Wales Metropolitan Water Sewerage and Drainage Board, the Sydney County Council or any of the other statutory bodies that issue debentures and raise money from the public. The AIDC is in the business of buying and selling securities in a big way. To that extent to categorise it with the ordinary public statutory corporations and therefore justify the exclusion of all such corporations on the grounds that it has been the practice in the past and there is no good reason for departing from that practice is I think, with respect to the Attorney-General, not being either logical or persuasive.
– I would like to add my voice to those who are asking the Attorney-General (Mr Enderby) to have another look at this provision. I believe in public enterprise in competition with private enterprise. I am a strong supporter of the Australian Industry Development Corporation. But at the same time I think there is an analogy with the Commonwealth Bank under the leadership of the Reserve Bank. It is not a perfect analogy but the Commonwealth Bank is in the same field, of course, as the private trading banks and follows the same rules. I was on the board of one of the State savings banks which did not come under the leadership of the Reserve Bank but which as a government corporation nevertheless decided of its own accord to follow the rules set down by the umpire which in that case was the Reserve Bank. I think in the same way, in a field such as this, the AIDC, operating in exactly the same area as many corporations which have to be registered, could well benefit itself by being seen to be part of that market and by being obliged to register under this Bill. I have said before, and I am sure that the Attorney agrees, that there is time for a number of the suggestions to be looked at again. I would ask him in particular to look at this question.
Clauses agreed to.
Clause 48. (Reports by registered corporations.)
-I wish to raise a small point. Clause 48 (3) states:
Where a registered corporation lodges a report or other document with the Commission under this section, the corporation shall forthwith send a copy of the report or document to every registered stock exchange that permits shares in the corporation to be traded on the stock market maintained or provided by the stock exchange.
It seems that this sub-clause ought to contain the words ‘shares and debentures’, or substitute those words for the word ‘securities’. I suppose it is a small matter in that only one word is involved. But the fact of the matter is that if this part of the clause is to have the desired effect, surely companies that just have debentures listed, quoted and registered ought to be included in it.
Clause agreed to.
Clauses 49 to 5 1- by leave- taken together.
– I wonder whether the Attorney-General (Mr Enderby) has considered an interesting point relating to clause 49 which is concerned with the allotment of shares otherwise than in pursuance of a prospectus. The aim of the clause, as I read it, is to have clarification for the general public to whom the prospectus is made available. Has the Attorney considered the situation that could arise where shares are made available to nominee companies of banks and set out in the prospectus. In such a case the Commission may find itself asking the banks, for whom their own nominee company is in existence, to advise them of the beneficial ownership of the shares? I have always understood that only the Commissioner of Taxation has been able to do that sort of thing in the past and neither the Government nor the Treasury has on any previous occasion in Australian history been prepared to intrude into that sort of field. Could the Attorney answer that question?
– If I could leave that question till later I shall come back to it, with leave.
– I am concerned with clause 51(1). There seem to be some doubts expressed in stock exchange circles as to whether or not some types of corporations fall within the categories laid down in clause 45. Really, I suppose, what falls within the area and what does not can be determined only by the courts. Yet, it is incumbent on the stock exchange to determine that and to take action. It seems that it is an obligation which is impossible for them to fulfil. I put that to the Attorney-General (Mr Enderby) for comment. I can well understand that he would want the stock exchange to do some policing and to put obligations on its members. But I think he will equally agree, particularly as the penalty in the legislation is $ 1 ,000 a day, that the legislation should be certain- I would suggest more certain than it is here- as to exactly what it is they are to do.
– I am sure that the honourable member for Curtin (Mr Garland) understands the thinking behind the requirement. We all know that it is necessary to have this requirement if the legislation is to be effective. I think the simple answer- and this may have escaped the attention of the honourable member- is that subclause (2) provides for an exemption- one can call it a power of temporary dispensation, if one likes- which it has been thought desirable to provide in order to avoid drastic action of the sort that perhaps the honourable member had in mind where there is a reasonable explanation for the absence of the copy of a certificate of registration.
Clauses agreed to.
Clauses 52 to 58- by leave- taken together.
– I want to ask the Attorney-General (Mr Enderby) a question in regard to clause 55 which deals with application for registration. It is only a small point but it is one that should be settled. I refer in particular to clause 55 (2) (c) which states that the application for registration shall be accompanied by the prescribed fee.
Is this a set fee for every application or does it have a relationship to the nature of the corporation, the size of it, the capital of it or what? Where will the prescribed fee be found? This is certainly not defined. Will the Attorney-General tell me what he has in contemplation?
– My contemplation relates to the fact that the whole business of the Commission, of course, is to start from scratch and bring this new system into being. It would be a set fee. The actual amount of the fee would be a matter for the Commission, based upon its experience, to set. I think that is a common enough experience for all of us who have met with authorities of this sort throughout the country. It is an experience which has been well established.
– With your leave, Mr Chairman, might I say that I am not quibbling about that. I am not disputing the need. Would a large company having an enormous capital pay the same registration as a small company?
– All I can say to the honourable gentleman is probably yes, because this, requirement is not designed to be a revenue raising measure nor is it designed to be a punitive measure. It is designed to achieve registration.
-I have had representations made to me in respect of clause 54. 1 am advised that the intention of this clause is to prevent a corporation from operating a stock exchange and permitting trading in securities on a stock exchange unless the corporation is a registered stock exchange. In its present form the relevant sub-clause might appear to prevent the management of a unit trust or a mutual fund offering for sale or re-purchase units or shares in such trusts or funds. The definition clauses- and I have heard the definition for stock markets, securities and unit- might well lead to the conclusion that the sale and purchase of unit trusts and mutual fund shares can take place only at a registered stock exchange.
If that is correct and the proposed legislation does not envisage this restriction on the operation of unit trusts and mutual funds, then there could be a need for an appropriate exemption to be granted under clause 54. By a wider and perhaps not unreasonable extension of these definitions one might also conclude that any place of business which regularly displays prospectusesfor instance, a bank, a hire purchase company, a stock broker’s office- could constitute a stock market and have to be registered as such. That last part perhaps sounds far-fetched. Nevertheless it is an extension of the earlier argument I made and I ask for clarification.
– When the honourable member for Curtin (Mr Garland) raised this question earlier he spoke also about the definition of securities and possibly the advantage of including interests in it. I think the best answer I can give to the honourable gentleman is that if it had been done that way then, of course, the unit trust would have been as he described it. It would have to go through a stock exchange. It was for that reason that interests were married to the definition in the way- we discussed earlier. It follows, of course, that the unit trust situation does not have to go through stock exchanges.
Clauses agreed to.
Clauses 59 to 6 1 -by leave-taken together.
-In respect to clause 59 1 ask the Attorney-General whether he will give an assurance that where the Commission directs that the constituent documents of the corporation have to be varied for one reason or another there will be a right of appeal to the proposed administrative appeals tribunal. The point is a short one and I do not want to labour it. It would seem to me to be an area peculiarly fitted for such a body as the administration appeals tribunal. The Attorney-General has informed us that we will see legislation in the near future for the establishment of this administrative appeals tribunal but it would seem to me appropriate, if there is a complaint made about a decision of the Commission, that an appeal be made to that body. I ask the Attorney-General: What criteria will the members of the Commission be looking at when they seek to vary the constituent documents? It seems to me that they have a power which is quite unrelated to the power in clause 58. Additionally, will the right of appeal be available?
In respect to clause 60, will there be a right of appeal where there is a suspension by the Commission of a corporation or the trading of a company? I do not want any ambiguity here. I did not mention all companies. I gave a specific instance of Broken Hill Pty Co. Ltd. If one company is suspended from trading for 2 1 days the consequences could be quite ruinous. I ask the Attorney-General: Will he give the Committee an undertaking that when a decision is taken by the Commission in such circumstances a right of appeal will be made available?
– There are at least 2 points raised by the honourable member for Moreton (Mr Killen). The first relates to clause 59. He will have observed that from its very language considerable safeguards are built into the clause itself as to how the Commission must go about < making its inquiries, conducting itself and its investigations. I direct his attention, by way of giving some examples, to clause 59 (2) which states:
The Commission shall not serve a notice on a registered stock exchange under sub-section ( 1 ) unless the Commission has afforded the stock exchange an opportunity to appear at a hearing before the Commission and make submissions and give evidence to the Commission . . .
In other words, a very substantial attempt is made to spell out at least the rudiments of what we normally regard as a fair go. I take the honourable member’s point with regard to clauses 59 and 60 about the possible advantage of providing an appeal to the administrative appeals tribunal. I will not give an assurance at this time but we will certainly keep the matter under consideration.
The difficulty, as the honourable member for Moreton would appreciate, ls in attempting to achieve a balance. One wants this Commission to be a working body. One wants it obviously to be able to bring about the same improvements in the Australian securities industry as the famous Securities and Exchange Commission of the U.S.A. brought about in the U.S. securities industry over a long period of time. One has, at the same time, to ensure that the rights or corporate bodies and the rights of individuals are properly safeguarded. It is a matter of balance. One does not want to put the Commission into shackles but yet one does not want to offend unnecessarily. I have to say that my first reaction to the honourable member’s question is that sufficient safeguards appear in the legislation. I will give the honourable member an assurance that we will certainly look at the matter again, particularly when the administrative appeals tribunal comes into existence.
-Perhaps I could follow up the point which the honourable member for Moreton (Mr Killen) made. Taking the spirit of the comments just made by the Attorney-General I might say that my comments will be quite brief but they are directed to the same area. To some extent the criticisms that I was about to make have been diminished by the assurances of the Attorney-General that at least he will examine the area of appeal. As it stands without an appeal clauses 59 and 60 are farreaching. I will not make any additional comments to those made by the honourable member for Moreton about clause 60. But clause 59, when taken into conjunction with other clauses in this Bill, creates a breadth of power which is really quite startling. I think one must say that.
We have already referred to clause 20. There is no need to repeat it except to say that clause 20 related to the functions and duties of the Commission. We did remark, in dealing with clause 20, how broad those functions were in their description. We find similar breadth in respect of clause 59- the power of the Commission to require amendments to constituent documents of registered stock exchanges. The breadth of power, for example, is indicated in clause 59(1) which, in the first 3 lines, states:
Where the Commission, after making inquiries and investigations as mentioned in section 58, is of the opinion that it is desirable that a change be made in the constituent documents of a registered stock exchange, the Commission may . . .
It goes on to set out the powers of the Commission. I simply ask the Attorney-General: Why was it not possible in framing the objects of this legislation to set out criteria which were appropriate to exercise the Commission’s discretion under clause 59? It says merely that it is ‘desirable ‘. My point simply is that in framing this legislation was it not possible to set out criteria whereby it was determined when it was desirable. As I say, the problem is partly overcome if, indeed, there is an administrative appeal. If there is not, then that power is indeed very wide. It may not be abused but there is no appeal to ensure that it will not be abused. If one examines clause 59 (3) one sees a similar breadth- again I read only part of the clause- which gives the Commission power to have regard to the rules of the Commission and states: . . may make provision for and in relation to any matter relating to the constitution of the stock exchange or the activities or conduct of the stock exchange or of its members or of other persons who are permitted to trade in securities on the stock market maintained or provided by the stock exchange. . . .
The breadth of that again is great when one reads it in conjuction with clause 283, to which I will not refer when we come to it but which specifically refers to the rules of the Commission and says:
Subject to this section, the Commission may make rules, not inconsistent with this Act or the regulations -
One should pause there to say that as the proposed Act is so broad the scope of the Commission is great indeed- for or in relation to-
As I have said, clause 59 (3) is so broad that it has a very full run indeed. Clause 284 relates to regulations. Again I mention this simply because it is all part of the package of powers which the Commission is to have under the Bill. Clause 284 reads:
The Governor-General may make regulations, not inconsistent with this Act, prescribing all matters that are required or permitted by this Act to be prescribed or are necessary or convenient to be prescribed for carrying out or giving, effect to this Act . . .
It goes on to deal with particular provisions. I just mention this on the basis that unless there is, and there certainly was not when we had to consider this Bill, adequate appeal procedure, then the powers are so broad as to suggest that the Government did not have a clear idea of what it intended this Commission to do. It was giving the Commission inordinate powers. As a safeguard perhaps the Government made clause 59 (4) very broad so that by regulation the rules of the Commission might be contained in some way. At the same time it was basically leaving everyone without the power of appeal other than the possible disallowance of regulations by the Senate, and as we all know the present situation in which . the Opposition has control over the Senate does not always obtain. I think I have made my point sufficiently without amplifying it except to say that there is a package of power which has caused alarm. The absence of powers of review again has caused alarm. One would have thought that the Government could have been more specific in its intention and could have set out the criteria in clause 59 (1). It certainly should have left more power with this Parliament to amend by legislation rather than to have amendment by regulation.
– I just want to refer to the point which the honourable member for Moreton (Mr Killen) raised on 2 occasions and which was mentioned also by one other honourable member. It refers to clause 60, dealing with the power of the Commission to prohibit trading on the stock market. Quite frankly, we should look at the sheer mechanics of this if we are to be either effective or efficient. I think that largely we are dealing here with the machinations relating to insider trading as referred to in clause 123.
– Would you give us an illustration of why you want to do it?
-In fairness, I thought I outlined that rather adequately last night; but I will repeat it. I think I ought to do so because the honourable member for Moreton is sincere in his concern about this provision. What I want to put to the chamber, as I did last night, is why the Commission ought to have the power and not leave appeals for 6 months if we want to prevent trading in a certain number of shares. For instance, let me refer to Poseidon. This is what I said last night, and I commend this to honourable members particularly for their early consideration:
I commend to the Attorney-General the functions of the New York Stock Exchange to establish a set of norms both as to price and volume fluctuations in each listed security and to suspend trading in any shares for 24 hours at any time that either of those norms are exceeded or until explanatory information is received and published.
All I am suggesting is that if the trip-point had been reached in the Poseidon affair on the first or second day of trading the Commission would have stepped in and said: ‘You have a margin of 15 per cent. If you trigger that trip-point trading will be suspended until we are satisfied that the board of directors or whoever it is that is trading in the shares is acting in the best interests ‘. If that had occurred the Poseidon scandal would never have reached any proportions at all. I put this to chamber honestly and sincerely. On the sheer mechanics of this, if the Commission or even the stock exchange is not given the power which the New York Stock Exchange has it will mean that should appeals arise people in similar situations to those in the Poseidon affair will be able to get away with exactly the same sort of scandal.
– What if they make a mistake, though?
-I have sufficient trust in the proposed Commission as one ought to have in these matters. This is a failure on the part of the stock exchanges themselves because either they did not want to exercise the power or they did not have the regulations to do this sort of thing. Had they had the power and had they taken that action, a lot of heartache would have been saved in this country in the 1969 boom. If we are effectively to cover insider trading which is referred to in clause 123, this sort of provision is inevitable; it must be.
– I was concerned about the import of clause 60 ( 1 ) concerning the Commission’s relevance when it considers it necessary or desirable to advise stock exchanges of the prohibition of trading of specific shares on the stock market. Nowhere in this Bill to date have we seen a reasonable explanation of the relationship between the stock exchanges and the Commission, insofar as the power of the latter presumably is much greater than that of the former; but I would have thought that since it is the actual exchange which has to handle the day to day administration of an exchange in terms of actual buying and selling of shares it should be mandatory on the Commission, if it is in command of facts which it believes to be relevant to trading on the floor, to pass that information on immediately to the actual exchange. This Bill merely states that information is to be passed on in writing. No concept of immediacy is included. I think this is very relevant. It is an important point. There have been many examples in the last few years of shares whose prices have fluctuated greatly on the basis of rumours and so forth. The exchanges have asked for explanations and the answers have usually been ‘We do not know anything about it’; but still the rumours persist and the market fluctuates accordingly. Much of this could be overcome if there were a much closer relationship between the proposed Commission and the actual exchanges.
– I think that many of the expressions of concern that come from honourable members opposite will disappear if the relationship that one assumes will come into being between the Corporations and Exchange Commission and the industry does come into being. Honourable members opposite assume hostility. It seems to be implicit in their comments that there will be some kind of detective or police role and nothing else in the type of role to be played by this Commission. The Government certainly sees it as being something much more than that, and that is why expressions of exhortation, if you like, were put into the legislation to encourage the industry to do this and to do that to protect the investor and not just simply to punish people. I have to say that if one considers the powers of the exchanges as they exist today one sees that they are in the hands of the members of the exchanges. I know that there is a school of thought that says ‘Let it be; that is the way it should be’; but I personally do not accept that point of view one little bit. I take another view, and honourable members would have heard me put it often in this place in connection with questions and debates concerning other occupations and certainly other professions. I suppose it can be summed up in very exaggerated form in that old saying of George Bernard Shaw that every profession is a conspiracy against laymen. The occupational groups, although they often say sincerely that they serve the interests of the wider public, because they are occupational groups or professional groups often cannot avoid having their own interests at heart. The danger of it, of course, is not that they abuse their position sometimes; the danger is that they are sometimes seen to be abusing their position, that justice just is not seen to be done. There is disquiet, uncertainty, confusion and concern of the public, often expressed through financial journalists, that they are a bunch of shysters who have to be handled roughly because otherwise they will not put thenhouse in order. It is the appearance of things that creates half the danger. If that is the situation that in part has to be put right, the Commission, as I see it, will have very considerable rapport with the industry.
I went to some pains earlier in the debate to emphasise that the people who will be put on the
Commission must be acceptable to the industry. If that rapport can be brought about so that it is a constant exchange of ideas and a constant friendly association, all the fears that are sometimes touched on in debate, I think, fall to the ground. I put it to honourable members that as people sitting here almost in a vacuum, looking out as to what might be the situation in the future, imagination sometime runs riot. But the Government has put considerable thought into the Bill, as I think it testifies, trying to provide safeguards and trying to achieve the right balance. One cannot prescribe everything that might happen in the future. This Bill already contains nearly 300 clauses. It would have 1,000 clauses if we tried to provide for every contingency. We would get into enormous difficulties. Neither can we have a simple Bill of Rights or Ten Commandments type situation leaving, say, commissioners or judges to fill out the legislation because we would not know what they would do.
I put it to honourable members that a very satisfactory compromise has been reached in this measure. On the question of public interest, of necessity the Commission has a rule making power. I heard it said that it is cumbersome because in some circumstances 44 days could elapse before a rule could be made and actually become effective. That is good in my view because rules are lawmaking processes of a sort. That is not a bad thing; it is a good thing. If we had allowed the Commission to make rules on the spur of the moment we would have had criticism of a different sort.
However, the rules can be disallowed in the House of Representatives and in the Senate. They can be disallowed on a motion of the House of Representatives. To provide an extra safeguard, if one is looking for safeguards, we have the other regulation making power of the Governor-General which can override the rule making power. So there is ample precaution in the Bill. We have spelt out all the safeguards with, I think, liberal provision for appeal as well.
– I have listened to the remarks of the Attorney-General (Mr Enderby) in relation to clause 60 and the comments that were made earlier by the honourable member for Hawker (Mr Jacobi). I can appreciate the significance of what the AttorneyGeneral said. Of course it is enormously difficult to arrange the powers of the Commission- and under clause 61, the Governor-General, which of course means the Government- to deal with this prohibition problem in relation to trading on the stock market. But I have news for the AttorneyGeneral and his advisers. I hope they are listening. He is creating a situation which will give a good deal of what-ho in the market because he seems to have forgotted that a stock exchange is a marketplace. All it needs is for someone to say: I say, old boy, have you heard the news today? The Attorney-General is going to prohibit trading in such and such a stock and it will be at a certain level on the market’. What happens then if the Attorney-General has to change his mind in three or four weeks time after an investigation? What would be the price level at which the stock would go back on to the market? Here is an opportunity for some really smart operatorsmost of whom are not lawyers, I remind the honourable member for Hawker- to get into a situation where they could make a cool fortune, whether they are in the Australian Labor Party, the Liberal Party or the Australian Country Party.
I remind the Attorney-General that under the legislation which governs oil exploration, the oil search assistance Act, there has been in Australia’ a situation in which no one can operate or assert that a commercial oilfield exists until such a proclamation is made by the Governor-General. It is within the power of the Crown to make such an assertion. Under the provisions of this Bill the Attorney-General may find that there is a risk of starting rumours. The Government does not appear to me to have provided for it to be an offence to start rumours which have an effect on the marketplace by announcing that the Commission or the Government is moving to prohibit trading in a certain stock. I would have thought that this needed to be done. I bring it to the attention of the Attorney-General because I think it is worthy of consideration. I suggest to him that if he ignores it, he is likely to have some really fascinating circumstances in 1976.
– I come back to the point that was being made by the honourable member for Balaclava (Mr Macphee) on the use of the word ‘desirable’ in clause 59 ( 1 ). I submit to the Attorney-General (Mr Enderby) that he really did not answer that criticism adequately. It is of no use talking about the Government having fine people with rapport because we have had too much experience in the last 2 years of where that has led us, though I certainly agree with him that it is tremendously important to choose the right people. Indeed, I referred to that in my speech in the second reading debate. In view of the assurances the Attorney-General has given us about that, if not the history of his administration as Minister for
Manufacturing Industry, I hope he makes the appointments and not the Prime Minister (Mr Whitlam). It is not really enough to say that a satisfactory compromise has been made. He is not even listening to me, so what is the use of talking?
– He is doing his best.
– I am glad to hear the assurance of the honourable member for Wakefield. It is not really enough to say that we cannot provide for every situation. The Bill contains words which are so wide that they could mean anything. If we say, ‘A commissioner, after making inquiries and investigations, is of the opinion that it is desirable’, we are opening up the door fully, we are not inhibiting anybody one little bit. We are not laying down any criteria to say where people should be limited. We are saying whatever they want to do they may do. It really would not result in hundreds of additional clauses. It would result in only about half a page, I would suggest, to inhibit these activities to some degree.
I said in relation to earlier clauses, and it is equally applicable to these clauses, that the whole question of the limit of power is involved in the debate on the clauses of this Bill. It is not enough to say, as has been said several times by speakers on the other side of the chamber: ‘We need a body, therefore let us set up a body and give it all the power it needs to deal with what it thinks fit’.
– Who has the power to list and delist at the moment?
– I am just trying to explain to the honourable member if he will follow my argument a little more closely.
– He raised a very important question.
– It is, but it is not on the subject I am discussing. What I am trying to explain is that it is the duty of this Committee and this Parliament to set limits on the power that it delegates. That is its duty. It is a proper thing for us to consider it. It is not a justification of the clause for the Minister to say: ‘We have to make the powers wide because we do not know how to inhibit actions properly and anyway, the fellows who are to be appointed will be jolly good fellows and we can trust them’. That really is not a good enough defence. That is in paraphrase what he told us. I emphasise the argument that was put earlier and say that some criteria should be set down to state what is desirable so that this power is restricted to some extent.
– The interjection by the honourable member for Hawker (Mr Jacobi) was the key to the matter. At the moment the power is exercised- to use the ugly word power’- by the exchanges. They are not accountable to the public interest at all. I saw a number of honourable gentlemen on the opposite side nodding when I said that occupational groups whether they be trade unions, professional associations or employers’ associations, often of necessity are obliged to put thenown interests first rather than the wider social interest. No one can argue against that, and that includes the stock exchanges. We know that they have the power- I am using the ugly, abrasive and naked word that we often run away from. They are not accountable to the public interest at all. That is why they are criticised and that is why, when the abuses and the scandals broke, the whole industry was brought in to disrepute. They were seen to have the power and they were subsequently seen not to be doing much about it. Whether they claim that they were doing the right thing or not doing the right thing, the public saw them as not doing the right thing. Surely it is better to give the power to a body that is publicly accountable; that has to present an annual report to the Parliament; that has a Minister responsible for it who will be answerable to the Parliament for what the body does or does not do; and that has a rule-making power that can be overridden by this Parliament. None of these restrictions is possible with the exchanges as they exist at the moment. Under these provisions, a regulationmaking power will be given to the GovernorGeneral. Again, the Parliament will be able to overrule that. That will be coupled with a generous system of appeals. None of these exists at the moment to soften or cushion the power of the exchanges. If one really wanted to say what was the best that could be done to advance the interest of the Australian security industry in the capital market one would have to say: ‘Make it publicly accountable in this way and avoid the criticism that is continually directed at it’.
– I return to the point I was trying to make to the AttorneyGeneral earlier. Whilst I appreciate much of his argument, I cannot help but suspect that the whole emphasis of this Bill is on the assumption of guilt;, that the stock exchanges have been wrong per se and therefore it is necessary to introduce this legislation. I think the Minister would agree with me that the circumstances surrounding the last mining boom were unique. They certainly have not occurred for a very great length of time. The same mining boom showed quite clearly that the stock exchanges as then organised were not capable of meeting the requirements of the hour. But there is a distinction between the capacity of the stock exchanges to do the job as we now think they should have done it and the real problem of protecting the investor from himself. I do not see how a man who wishes to gamble can be stopped from putting money on a racehorse any more than he can be stopped from putting money in a share. This is a human weakness, a failing, that we all have. Probably many of us put money in mining shares during the days of the mining boom and, undoubtedly, many of us lost. I want to make that point clear because, in relation to clause 60 ( 1 ), I still do not understand and I do not think anyone else in this chamber understands, on the basis of the explanation given so far, precisely what the role of the Commission will be in relation to the stock exchange. The Minister has said that he expects a close and good relationship to exist, and so on. However, it seems to me that the exchange will be given no authority over its members, and no authority over its own market place- I emphasise that it will still be the market place of the exchange which will be used- and I think that honourable members deserve specific answers to these questions.
-This clause touches on an important matter. I am sorry to repeat myself but it is necessary as a result of what the Attorney-General said.
– Are you dealing with clause 59?
-Yes. In the first place, I thought it rather interesting that the AttorneyGeneral seemed to assume- I think he said it twice- that the passing of this proposed legislation will improve public confidence in the stock market. With respect, that remains to be seen. It is a brave man, I think who starts to predict whether or not the market is going to improve. I make that point in passing because we really are looking into the crystal ball in that area. I hope that is not indicative of comments on other clauses. In the Attorney-General’s remarks, he directed himself to a criticism of the establishment of a commission. He attempted to justify the existence of such a commission. That is not in dispute. I agree with all the objectives he said were desirable; they are desirable. It is desirable to inhibit the Commission, to provide powers, and so on. But that is not the point. The point is whether or not the power to be given to the Commission is too wide. I return to the words ‘It is desirable’. It is a limitless power. All the Opposition is seeking is an inhibition of that power, the insertion of some criteria into the Bill to give an indication of where that power should end.
It is just of no use for the Attorney-General to make speeches and say that the Opposition is against the Commission and does the Opposition not think it desirable that the stock exchanges should be controlled. We agree to that; I think almost everybody does. The point is whether the words ‘It is desirable’ can be sharpened up a bit so that it will be known exactly what is to be the limit of the power. It is not a good argumentalthough I do not think it has been advanced yet- to say that the legislation can be brought back into this chamber where it can be amended again. We know the crush of Bills that comes into the Parliament and, at times, how quickly they get jammed in. I ask the Attorney-General, if he has any reply at all, whether he will consider inserting some criteria into the Bill that will to some extent limit that power so that the people who are interested in practising in the field will have some idea of how far the Commission can go.
– The question is: ‘That clauses 59 to 61 be agreed to’.
– I understood we were considering only clauses 59 and 60.
– When we considered the grouping originally it was decided to take clauses 59, 60 and 61 together.
– I understood we were debating only clauses 59 and 60. However, in view of what you have said, I would like to address myself to clause 61.
– I rise on a point of order, Mr Chairman. I am sorry to interrupt my colleague but I have to take the point of order immediately. I was clearly of the impression that we were dealing with only 2 clauses, 59 and 60. Clause 6 1 is of tremendous importance and one to which I think honourable members would have wished to devote one of their two 10-minute speeches had they known that it was included in the questions we are debating.
– I put the question from the chair about 12 times in the last half-hour.
– What was the original question?
– The original question was: ‘That clauses 59 to 61 inclusive be agreed to’.
– I excuse myself for being dogmatic on the point. I said clauses 59 and 60 but not 61.I am wondering whether Hansard could clarify the position.
-If the Attorney-General is agreeable to excepting clause 61 I will put the question only in respect of clauses 59 and 60.
– Will the Minister adopt the course of action suggested by the Chairman, namely, that the question be put that clauses 59 and 60 be agreed to and that clause 61 be dealt with on its own?
– Of course.
Clauses 59 and 60 agreed to.
– by leave- I regret that it is necessary for me to make an explanation in connection with additional staff assistance to members of Parliament, but I do so because of certain misleading and false reports which have appeared in the daily newspapers in most States. Yesterday the Government approved of a proposal that each senator and member of the House of Representatives be permitted to engage additional assistance as required in their electoral office within the financial limitation of an annual amount not exceeding the base salary payable to an electorate secretary, which at this stage is $7,353 per annum. The provision of this extra assistance will be available from 1 March 1975, and an amount of $2,500 will be available to each senator and member for the balance of the financial year 1 974-75 for this employment purpose.
The type of electorate assistance required and the personnel selected will be a matter for decision by the individual senator or member. This is a long overdue reform as the staff entitlement of a member has not been increased for more than 30 years- as a matter of fact, since December 1944. I am disturbed, however, to have seen newspaper reports and to have heard over the radio- unfortunately that includes the Australian Broadcasting Commission, the national service- that this is an additional personal allowance for members. These statements, of course, are completely false and without any foundation. It is not an allowance to a member of this Parliament. The proposal provides in blunt terms for additional staff for members who will be paid by the Government under Public Service conditions. If the money is not used or taken up for employment purposes it will revert to the
Treasury. Consequently, the statement that members of Parliament are to receive an additional allowance must not go unchallenged.
I am also disturbed by an article which appeared in today’s Sydney ‘Sun’ under the name of Neil O’Reilly. At least he signed his name, and that is about all that can be said of the article. Under the heading ‘M.Ps Wives $7,500 Jobs ‘it states:
Some Federal M.Ps plan to employ their wives as thennew research assistants at $7,500 a year.
They say this will be one way of getting a pay rise.
I regret that I have to give publicity to this article, but I think that it is as well to put what I have to say on the record in order to show the type of journalists who associate in the Press Gallery in this Parliament, enjoy all the privileges and write drivel like this. The article continues:
The Government yesterday agreed to allow each of the 187 M.Ps and Senators to employ a research assistant.
They will be able to hire a full-time secretarial worker on a $7,500 a year salary or a pan-time assistant paid at a higher rate.
But the amount they will be allowed will still be limited to $7,500.
Several M.Ps -
Several’, mind you, it does not mention any of them - claimed today the new staff arrangements were an attempt by the Government to stop pressure for a further pay rise this year.
Quite frankly, I have not got that in mind. It continues:
The Prime Minister, Mr Whitlam, is opposed to any pay rise because he has appealed for wage restraint.
A group of members -
A group’, mind you - said today there was no embargo on who they could employ as their extra staff.
That is correct, but I wonder who the group of members is. It is marvellous how these groups of members are always about to make statements for articles like this. The article continues:
One said he would be able to employ his wife to perform electoral work.
– It was not me.
-Who was it? The honourable member for Griffith is the only one who is exempted. The rest of us could be charged v/ith having said that. The fact is that the article said that one member said that. No names are mentioned; there is just innuendo. The article continues:
She already does this, answering the phone and representing me at functions I cannot attend while Parliament is sitting, ‘ he said.
If I could put her on the payroll she will be getting paid for all the work she now does for nothing, ‘ he added.
Another MP -
Another one, mind you - said that several Senators already employed their wives as private secretaries.
When I saw this article this afternoon I made a quick check, and so far as I have been advised by my Department to this stage, that statement also is without foundation. I will admit that I did not have time to make a thorough check, but no member of this Parliament has advised me that he intends to employ his wife in this regard. The article continues:
There was no reason why MPs should not use this new opportunity to employ their, own wives.
I will not go further into the article, but I ask leave of the House to incorporate the balance of the article in Hansard.
-Is leave granted? There being no objection, leave is granted. (The document read as follows) -
By employing their wives at $7500 a year MPs would save tax. MP ‘s would have to pay much higher tax if they received a straight pay rise of $7500 a year.
Most MPs today claimed that they would not allow the appointment of an extra staff member to prejudice their claims for more pay.
Both Opposition and Government MPs are adamant that they are entitled to higher salaries because of missing out last year. 0
One MP complained today: (Junie Morosi is getting more than a lot of us if you take into account her allowances. ‘
– I draw attention to the one paragraph that made a bit of sense. It reads:
Both Opposition and Government MPs are adamant that they are entitled to higher salaries because of missing out last year.
Unfortunately that article has been more or less repeated in the Melbourne ‘Herald’. The gentleman who wrote the article for the ‘Herald’ is named John Monks. Evidently he is a bit lazy because he thieved the article; it is practically of the same substance as the ‘article which appears in the ‘Sun’. The ‘Herald’ also contains a disgraceful cartoon which does little credit to anyone associated with that newspaper. I say this of the article, and I put it on the line: It is false, misleading, based on innuendo, half-truths and insinuations. It does no credit whatever to the writer or to the newspaper, as it is completely without foundation and I repeat that it is completely false. I repeat also that I have no knowledge that any member intends to adopt the course that has been suggested in the article. I wonder whether many pressmen have their wives engaged in their business? Of course, many doctors adopt this practice, but evidently they never care to popularise it.
I am one who believes that the privileges of members of Parliament should not be abused, and I have advised the members of my Party accordingly. I have advised them also that this facility is one that should be regarded as of great importance to enable them to employ staff of the highest calibre to carry out their electoral responsibilities. I have no reason to doubt that when this matter was discussed by Opposition members my views on this subject were made known to them at their party meetings. It is therefore disturbing to see such an ill-founded statement made in this newspaper and, unfortunately, followed in some other newspapers in an attempt to degrade and ridicule members of this Parliament on unsubstantiated grounds.
I therefore take this opportunity to explain the position. I regret that it has been necessary for me to do so, but unfortunately I think that it had to be done in the interests not only of the Parliament but also of every member of this House and of the Senate.
-by leave-This is the second offence by this journalist. He was the one who released the story about the confidential report on meat prices. I ask you, Mr Speaker, to look at the detail of this report to see whether in your opinion there is a prima facie case to put this matter before the Privileges Committee, with a view to removing this man’s right to be in the Parliamentary Press Gallery. This would not disenfranchise the Press or the particular newspaper; it would take away from the Gallery a person I believe is not fit to hold a Press pass in this place.
-by leave-I am prompted to enter this debate by the remarks of the honourable member for Blaxland (Mr Keating). Whatever decision you, Sir, may take in this matter- whether you consider it a prima facie breach of privilege- is a matter entirely and peculiarly within your jurisdiction. I hope that in no way- without seeking to defend or to offend- we would countenance any assessment until you Sir, and, if need be, the appropriate parliamentary tribunal had considered the matter. I mention that so that we will not be persuaded to adopt any hasty judgment, no matter what the nature of the provocation may be.
-Order! When any member brings before the Speaker any matter regarding privilege I have to decide whether a prima facie case has been made out. I will do so and I will inform the House of my decision at a later stage.
Bill returned from the Senate without amendment.
– I am grateful to the Attorney-General (Mr Enderby) for having rescued us from a mild measure of embarrassment as to what was involved in the grouping of clauses. This is one of the most significant clauses in the Bill. It is a clause which I hope would never be resorted to by any government, because plainly recourse to a provision of this nature would be taken only in the gravest emergency. The clause reads as follows:
The Governor-General may, where he considers it necessary or desirable to do so for the protection of persons buying or selling securities or in the interests of the public, by notice in writing to a registered stock exchange-
The power is clear. It means that the GovernorGeneral could shut down an entire stock exchange. I hope that nobody will be misled. This is not some expression of gubernatorial solicitude for the investor or the company. This power means that a government could shut down an entire stock exchange, because it is the conventional rule that the Governor-General acts on the advice of his Ministers, although it is useful to recall that a former leader of the Australian Labor Party, Dr Evatt, observed that surely it is wrong to assume that the GovernorGeneral is a mere tool in the hands of the dominant political party.
For all practical purposes, one may say that this proposed section would give to a government a power to shut down- indefinitely, mark you- an entire stock exchange. It is not a case of suspending from trading one company. It is not a case of questioning the professional or commercial ethics of any person or any group of people. An entire stock exchange could be shut down. I do not think that even during the war, when we were faced with the prospect of invasion, the stock exchanges were shut. I ask the AttorneyGeneral to state the circumstances in which he envisages there would be recourse to a power of this nature. For my part, if I had the numbers at my disposal in this chamber, quite apart from any instinct on the question, I would throw the clause out completely because it is not a clause which lends itself in any way to ready assessment of a set of circumstances which would justify its use. I ask the Attorney-General to tell the Committee what is within his contemplation as to the circumstances in which he, as the chief law officer in the country, would say to the government, and the government would make a decision: ‘We believe that the Brisbane Stock Exchange should be shut’.
This is a very significant power. It is one of the great powers proposed to be given to the Government in this Bill. It is not a power to be used by the Commission. There is no continuing professional judgment as to the circumstances in which it should be used. I hope that the AttorneyGeneral will respond to my invitation because very considerable concern is held by people not merely in the industry and not merely those who serve on boards. I believe that, as there is a gathering comprehension of this power, there will be widespread concern. It is not enough to say: ‘The power will never be used’. I am asking the honourable gentleman to say, firstly, why there is a need for the power and, secondly, under what circumstances a government in command of a parliamentary majority would seek to resort to the use of this power. I do not wish to ascribe to the honourable gentleman’s Party any malevolent purposes or motives; but imagine the chaos, imagine the confusion, imagine the sheer disaster that could be visited upon this country if, through some act of political caprice, it was determined to shut down one stock exchange or, if need be, to shut down every stock exchange in Australia. This is a very great power indeed and I think honourable members are entitled to a reply from the Attorney-General couched in terms of acute candour.
– I too think that clause 61 should be deleted without any equivocation. I ask the Attorney-General (Mr Enderby) before he replies to consider that this clause permits by Executive warrant, without any prior inquiry, what could be potentially the most devastating economic action that any government could take. The honourable member for Hawker (Mr Jacobi) is expressing some dissent from that. Has he any conception of what would happen if through a foolhardy act a government closed down the Sydney or Melbourne Stock Exchange?
– I did not say a thing.
-I am sorry.
– If it is in the interests of the people it should have the power.
-The honourable member for Hunter thinks it is perfectly all right for any government, whether or not it is of his persuasion, without any resort to Parliament and without any requirement for prior inquiry, by Executive warrant to close down a stock exchange. I do not think that honourable members opposite who support that proposition have any real conception of what total economic chaos and collapse would occur if that happened. They have no conception of the enormous financial devastation that would be incurred by small investors and by large investors if a stock exchange were closed down. Do they realise that if that were to occur it might be decades before real financial confidence was restored in this community? People would lose millions of dollars if this were to occur. I am not suggesting to the Committee that it is beyond possibility that in very extraordinary circumstances it might be necessary for a government at some stage in the future to do it, but what I am protesting about and what the honourable member for Moreton (Mr Killen) protested about is a blanket Executive warrant being given by this Bill to the government of the day by a blunt action to close down any one of the stock exchanges of Australia.
If a government felt that it was necessary to do this, why could it not introduce a special Act of Parliament? If the Attorney-General finds that unacceptable, will he consider writing into the Bill some proviso for affirmative resolutions of both Houses of Parliament; or is the attitude of the Government simply: ‘Oh no, it does not matter’? If at the Executive caprice of a government a stock exchance can be closed down, I seriously wonder whether honourable members opposite who support the potential use of the power contained in this clause have any real conception of just what damage would be done if a mistake were made in the exercise of that power. I am not being obstructionist. I think that this goes to the very heart of the criticisms that have been made of this Bill. It is no use honourable members opposite interjecting and saying: ‘If it is in the interests of the people to stop the marauders and the robbers we will close down the exchange’. In the process of stopping those marauders and robbers they would be robbing many innocent, honest people of money and causing total economic chaos. I am not suggesting that the situation might not conceivably arise when the sort of power which is envisaged would be exercised. If that were the case I think the proper course of action would be to introduce a special Act of Parliament. I ask the Attorney-General very sincerely and in no sense of being an obstructionist to reconsider seriously whether this clause ought to remain in the legislation.
– I too would like to lend my voice on the very grave problems which the Opposition has in relation to the substance of clause 61. They have been well enunciated already by the honourable member for Moreton (Mr Killen) and the honourable member for Bennelong (Mr Howard). That clause in fact empowers the Governor-General, on the advice of his Government, to do certain things where it is considered necessary or desirable to do so for the alleged protection of persons buying or selling securities or in the interests of the public. The term ‘in the interests of the public’ is about as nebulous as the phase ‘the national interest’ which we hear so much from the Government. It is a concept which we find incorporated in much legislation. What the term in fact means is that the Labor Government, lilywhite as it is, would not consider doing anything which was not in the interests of the public.
I put to the House a case in point. It could involve Broken Hill Pty Co. Ltd or, for example, General Motors-Holden’s Pty Ltd if it had shareholdings in the Australian market. It does not, but we will take it as an example. Recently there was a very major difference of opinion on the question of industrial policy and labour relations between Dr Cairns and General Motors. I leave it to the imagination of honourable members to see that it would not be very difficult for any government- of course the Labor Government would not do such a thing- to say: ‘All right, if you are not going to co-operate with the policies which we enunciate and which we wish you to carry through we shall use all thepower at our executive command to force you to obey our instructions’.
– I want to make a few brief observations on this matter. I think I touched on it last night. The so-called home of capitalism, which is the United States, has the power to suspend trading, and it was introduced for a very good reason. Once again I think I mentioned that last night. It was introduced back in the 1930s because of runs on the stock exchange which brought financial chaos to the American economy. President Roosevelt had to do 2 things when he came to office.
– When it can be.
– The honourable member interjects and says: ‘When it can be’. I am telling him when it was.
– Why copy the Americans?
– Opposition members are great people for citing the capitalist system. They like all that is good in it but will not accept all that is bad about it. President Roosevelt had 2 tasks to face.
– Are we not big enough and rough enough to make our own laws now?
– I suggest that the honourable member has another look at the activities of the stock exchanges over the past 2 years.
– In the last 2 years they have gone down the drain, thanks to your policies.
– I do not know that it was because of our policies. In fact, it is people who machinate on the stock exchanges who have got us in the position in which we find ourselves today. We will find that the Government is going to be asked to prop up capitalism in a lot of other areas by legislative means. President Roosevelt had to regulate the stock exchanges and the banking institutions. It was because of their failure to act responsibly in a corporate national sense that he was forced to enact the powers that we want in this particular legislation. The mere fact that the power is there ought to exercise sufficient restraint and responsibility on people who move into the stock market to ensure that we have no recourse to the legislation.
– Do you believe that it has been misused?
The DEPUTY CHAIRMAN (Mr Lucock)Order! I suggest that the honourable member for Hawker be allowed to make his speech without interruption.
– I conclude on this point: I trust that the power never has to be used. If there is responsibility in a capital market there will never have to be recourse to it. It is a provision which in the current situation any government certainly ought to have.
– The points of view put forward by members of the Opposition probably go as far as anything that has been said today to illustrate the fundamental difference between members of the Liberal and Country parties and members of the Labor Party. I am not trying to be provocative. I see that Opposition members are nodding their heads. After a bad start the debate has gone reasonably well for a little while. I shall try to put to the House the way in which the Government sees the situation. What is envisaged is an extreme power to be exercised and it would be exercised only in an extreme emergency. This matter has been touched on by speakers from both sides of the House, but it is a power that exists at the moment in the private stock exchanges. They can invoke such a power.
I have to cover some of the ground that I covered at an earlier stage in the debate. We place the public interest extremely high. We believe strongly that it is far too important to leave matters of this sort to a small occupational group which conducts its affairs in secret through a system of committees. Whether it is one committee or 2 committees, no one knows. One cannot find out unless one is on the stock exchange, hears some gossip or rumour, or has read a book on the subject, which expresses only an opinion anyway. I cannot find out what is the situation. There is a corporate veil of a sort beyond which the public interest cannot penetrate at the moment. In placid times, in even times, probably no great harm comes from it, and yet we know that there are times when great harm comes from it. I refer to the mining scandals of a few years ago in this country, but it is not restricted to that type of situation. It goes beyond that. From time to time one reads that trading on a particular security has been stopped. The reason it has been stopped is that to allow it to continue on the market would be to run the risk of people being hurt and injured by losing money. Sometimes they could lose very large sums of money. Sometimes it could have consequential adverse effects on innocent people.
At the moment the power to say whether the trading on a security should stop or should not stop is given to a group of often anonymous people who are not elected by the public in the same way as we are elected as politicians. Often such people buy seats on the stock exchange and grow up in the ways that are peculiar to the industry. Behind their closed doors they make their decisions which are not open to public scrutiny at all. They are criticised because they do not make a decision when often it is thought proper that they should. We believe that decisions of this sort should be brought into the open. They should be, insofar as it can be done practicably, made subject to public scrutiny. We do not want to create any monstrous bureaucratic nightmare any more than anybody else does. But the power which we seek in this Bill is already in existence. It is in the hands of a hidden, secret bureaucracy which is not accountable to anyone or anything except its own selfinterest. I see that the honourable member for Bradfield is about to ask me a question.
– Where is the opening? Where is this public examination?
-What I am putting to the House is that the exercise of this extreme power should be in the public hands. There may be alternative ways of approaching the problem, but I think that this is an adequate and eminently suitable way of doing so. I am not impressed with the argument of the honourable gentleman who said: ‘Suppose a situation arose between General Motors and Dr Cairns, as Deputy Prime Minister, in which, arising out of pique, annoyance or something else, the Government acted in some way?’
– I said some future government.
– I hold this Parliament, this institution, in far more esteem than that. In fact, if I were to be given a free choice between the captains of industry- they are all good men- and the men of any party which leads our country, whether it be the Liberal Party of Australia, the Australian Country Party or the Australian Labor Party, I would give far more status and esteem to the people who have become Ministers of the Australian Government and who lead the country. I would give far more esteem and status to them because they are more responsible generally. They are elected and they have public opinion behind them all the time. For example, to come back to, with respect, the absurd example that the honourable gentleman gave, if this power were to be exercised it would obviously have to be considered by the full Cabinet. There are 27 Ministers in the present Cabinet. Every one of them is accountable to this Parliament and every one of them is accountable to the people outside through the media. There would be a Cabinet decision, with all the safeguards that go with that, to put up a recommendation to the Executive Council, which would give effect to it. It is obviously a power that would be exercised only in extreme situations, but at least its use is publicly accountable.
– But would its use be debatable in the House?
Mr ENDERBY Of course it would be. The Opposition could take action in respect of it. It could move a censure motion against the Government.
– But would the damage not then be done?
-Let me put the point that this power would be exercised only in a crisis situation, which the honourable gentleman has himself admitted could arise.
– These are all subjective criteria.
-Of course, but they are subjective in the present situation. The gentlemen who make the decision now to close down an exchange are subjective. We do not know their names. At least we know the Prime Minister’s name. At least he is an elected officer. As the Prime Minister of this country he has to expose himself to public criticism, to be seen for what he is and to justify his actions in public. In this House at question time every day he has to defend and justify himself. Which people in the stock exchanges who have this very power now have to expose themselves and be subjected to those checks and balances to which ministers are subjected continuously? I believe that when decisions of that sort are as important as that they should be made in the public arena. To my way of thinking that is democracy. The alternative of leaving the position as it is- is certainly a negation of democracy. It is to leave a decision of this sort- this power which might never be used- to a group of individuals who are not responsible or accountable to anyone and who could be sick, who could be imbeciles or who could be malicious. They are all things that could happen in respect of a politician, but at least a politician has to stand up in public and be seen. The ultimate sanction is the public’s opinion at an election. If the power were abused it could in some circumstances bring down the governmentand rightly so. There may be other alternatives, such as the various measures that the honourable member for Bennelong has suggested, but I put it to honourable members that given the safeguards and given the fact that the power now exists we are only subjecting the exercising of the power to democratic controls. That is all we are doing in writing such a provision into this legislation in this way.
I turn to the point about when it might be exercised. We all remember- at least some of us do with a little bit of memory aid thrown in- what happened in the 1930s. But it was that not long ago, apart from the mining scandals in this country, when selected applications through the Commission would have been appropriate. Let us never forget that we are thinking not so much of the people who make up the exchanges- the traders, dealers and stockbrokers, although we have to take their interests into account- as of their clients, their customers, the Australian public. That is where the principal concern should lie. How long ago was it when serious writers on economic matters were talking about a return to the great depression years of the 1930s and we were getting reports from the Organisation for Economic Co-operation and Development that the end of capitalism was in sight? All the more recent signs seem to suggest that the economy is picking up a little, and we are all very glad about that, I am sure, but if those signs had gone the other way and had continued going the other way, who would rule out that an emergency situation would not have been called for at some stage in which actions of this sort could have been taken either by private individuals or by a commission and be appropriate in the interests of protecting the public? The point is really quite a simple one. The power exists now and it is exercisable by people who are not accountable to anyone except themselves and their own interests. This will transfer the exercising of that power to properly elected governments.
Sitting suspended from 6 to 8 p.m.
-Before the sitting was suspended I was about to make one or two remarks about clause 61. The AttorneyGeneral used as an example of the value of this clause the possibility that the economy could have taken a great downturn and he seemed to be saying that under those conditions the Government would advise the GovernorGeneral to close the stock exchanges of this country.
– I did not say that.
– Well, the Attorney-General used as an example that that was the sort of condition when it might be used. Did the AttorneyGeneral give any other example?
– I did not say what you just said I said.
– Well, the Attorney-General is not being very explicit so he obviously does not want to commit himself too much. But the Hansard record will show that the Attorney-General used as an example the possibility of the economy greatly deteriorating, I think, if I recall the content, from a point that it was at recently. Of course, that raises the fears that we would have about this clause. Mention of the GovernorGeneral, of course, ought to be taken up immediately because, as the Attorney-General must concede, that means he would act on the advice of the Government. He said that if that was contemplated of course there would be a Cabinet meeting of 27 Ministers who were responsible, responsive and so on. Of course, he cannot give any assurance about that. We have seen the Prime Minister (Mr Whitlam) make decisions about currency and many other things without consulting his 26 other Ministers. So really that argument falls to the ground. I understand that the stock exchanges did not close down during the threat of invasion to this country in the 1940s. That was a pretty serious event. So one does get to the position of asking really under what conditions one would expect the Government to advise the Governor-General to close down the stock exchanges of this country. What motives would a government have? What objectives would it have for doing such a thing? The Attorney-General’s better argument was: Look, the stock exchanges themselves could close themselves down. If they can do it and they have a certain amount of public accountability surely to heaven governments should have the right to do it’. I think that pretty fairly puts his argument. OK, one can accept that to a point. But of course it would be about the last thing that the stock exchanges would want to do. In fact they have not done it. The motives of this Government cannot be so clear. We have seen, with respect, a certain amount of backing and filling in policy by the Government in the last few months. Therefore one cannot help wondering whether the Government would not take a different view a little later on once it had this power.
The Attorney-General also said- indeed the clause itself says- that this closing down would be done for the protection of persons buying or selling securities. So the Government will make a decision about whether or not that is in theninterests, not they. Obviously, if the market went down anyone who had shares could continue to hold them until it improved. But maybe people would want to sell. So where are the interests of the people who want to sell to turn their securities, which are perhaps in the form of savings or investments, into liquid funds without the facilities of the stock market? I mention all those things- they are obvious enough- simply to expose some of the difficulties about this clause and to expose the lack of .convincing argument put by the Attorney-General to justify it. I confess, for my part, that I have severe reservations about the use of this clause. I think that some of my colleagues share these reservations. We might have taken stronger action but perhaps the moment is a bit too soon to be looking at that now.
I say only that I do not find the reasoning convincing. The Attorney-General will find when he reads Hansard that he did allude to the economy going further down. He was talking about this clause so there cannot be any gap in the reasoning there. I have pointed out that it has not been found necessary under the most extreme danger faced in this country to close down the stock exchanges. I have pointed out also that when we are talking about the protection of persons buying and selling securities there are certainly other aspects from those that I mentioned.
Clause agreed to.
Clauses 62 to 65- by leave- taken together.
– I invite the Attorney-General to take into account the present character of drafting of clause 65. This provision gives to the Commission a power to cancel or to suspend a stock exchange from all forms of activity if the stock exchange has, in the opinion of the Commission, repeatedly failed to take adequate steps to enforce or to give effect to the business rules of the stock exchange. May I say one thing on this clause: If there is an infringement of the rules plainly there must be a sanction. I do not argue that point with the AttorneyGeneral or with my friends opposite. I am sorry that there is not the same splendid coincidence, of sentiment in other fields of activity. But that calls for a consideration of another character of sanctions. The fact remains that the judgment of the Commission may be wrong. It is not good enough for the commission to say that, in its opinion- to use the language of the clause- the registered stock exchange has repeatedly failed to take adequate steps. There should be the plainest obligation upon the Commission to say in what respects it has failed. I am sure that the Attorney-General will understand that if a charge is made against any person one is entitled to particulars. If the Commission makes a charge against a registered stock exchange and says: You haved repeatedly failed to take steps to enforce the business rules’, the obligation should be there- and it should be observed- for particulars to be given. This is not asking too much because the consequences are immense. It is not good enough to make a suspension or- indeed, worse- to make a cancellation and then to seek to repair the damage.
It could well be that a hearing before the Administrative Appeals Tribunal under sub-clause 8 of clause 65, which deals with appeals to that Tribunal, may result in the Tribunal, on hearing arguments on the point asking what was the basis, what was the nature of the particulars. I would hope that before this debate is over I will be able to take the honourable the AttorneyGeneral to that- splendid and lively state of reasonableness that he protests he already commands. I am not asking for anything unreasonable. I am merely asking that where there is a complaint made by the Commission against a stock exchange particulars be given and that those particulars .be taken into account. The other observation I make on the clause is that there should not be that final act of suspension or of cancellation until the appellate provisions have been exhausted. Damage could be done and it could be very hard to undo.
– I rise to take up one point that was made by the honourable member for Moreton (Mr Killen). I wrote down his words: ‘If there is an infringement there must be a sanction’. I accept the admission because the present state of our law provides no such sanction.
– I do not argue with that.
– Well, it is relevant to what the honourable member said because implicit in everything honourable members on the other side of the House have said on this subject is a suggestion that in some way we are creating a system that is worse than the present system. The fact remains that the present system gives all the powers about which the honourable member expressed concern to this Commission. The present system has the powers in the hands of unrepresentative, unelected, anonymous people- people who conduct their affairs behind closed doors and who are not accountable to anyone but themselves. If they infringe what is right; if they engage in what is wrong, no one has a sanction. The history of the last few years of the Australian stock exchanges bears that out. The testimony of the Rae Committee bears it out. There is no sanction. How often have we heard in this House and in the Senate suggestions that the closed committee that reflects its own interests does not really do anything to discipline its members who are guilty of all sorts of offences? What the Government seeks to do is to make the conduct of the exchanges accountable to the public interest. They are not accountable to the- public interest at the moment. All manner of safeguards are provided which do not exist now. None of the safeguards that honourable members opposite say should exist, exists now. We are providing in this Bill many safeguards that do not exist now. As the honourable member for Moreton reminds me, they can do that. Of course they can do that.
-They can stop trading.
– What, the whole stock exchange?
-Of course they can. I remind my good friend- I have to remind him because he has not really read the Bill- that if he examines clause 65 (7) he will see a provision which states:
Subject to any order of the Administrative Appeals Tribunal -
The one to which the honourable member for Moreton referred- a decision of the Commission to cancel or suspend the.registration of a registered stock exchange takes effect on the expiration of such day as is specified in the notice given to the stock exchange under sub-section (6), being a day not earlier than 1 4 days after the giving of the notice.
A lot of safeguards are built in. Sure, I would agree that one could say it should be this way of that way. No safeguards exist at the moment at all. If one looks at the mischief that we are trying to put right one sees an absence of safeguards. If one looks at the remedy the Government is proposing we see plenty of safeguards. That is the simple point, surely.
May I also say to the honourable gentleman that implicit in the language of clause 65 is the proposition that if the Commission decides to cancel or suspend the registration of a stock exchange- something that can happen already- it has to give reasons for the decision. No such reasons have to be given now under the existing law. Under this clause there will be adequate protection for a registered stock exchange. It will have the right to apply for a review of the decision to the administrative appeals tribunal. The additional good feature- it is quite exciting for those of us who have considered the absence of uniformity in administrative law in this country for so many years- is that with the emergence of the administrative appeals tribunal for the first time Australia will have some regular set of guidelines and a minimum set of standards by which tribunals of this sort must conduct themselves. If they depart from those minimum standards then a remedy will be given to the injured person.
Clauses agreed to.
Clauses 66 to 8 1- by leave- taken together.
– I have 2 queries I raise. I am not raising one of the points out of a sense of obstinancy but of Irish persistence, a quality which I regret to say the Attorney-General does not quite understand but which the honourable member for Grayndler and the Leader of the House (Mr Daly) does understand.
– I always thought that ‘Enderby’ was an Irish name.
– He conceals the qualities of the race very well. I come back to the definition of a stockbroker. Under clause 66 ( 1 ) dealing with licences reference is made to dealers in securities. The point I make to the Attorney-General is a short one. It is not only stockbrokers who deal in securities. There are companies which buy securities and there are companies which sell securities. Even though the Attorney-General this afternoon asserted, I thought, with rather boundless enthusiasm, that there was no State securities Act which defines ‘stockbrokers’ I in my Spartan simplicity brought in here the Acts of the New South Wales Parliament and there was the definition of ‘stockbroker’. Of course, the honourable gentleman may have a rather jaundiced view of my motives and of” my attitudes but I repeat that I am here to help.
I would hope the Attorney-General would at long last come to the realisation that one of the significant gaps in the Bill is the fact that in the Corporations and Securities Industry Bill, of all forms of legislation, it is not defined what is meant by ‘stockbroker’. There it is. I would hope, during the slumbers of the evening, that the Attorney-General may come to a realisation that there may have been something in the proposition put to him so simply, so fervently, by the honourable member for Moreton. That is the first observation I make on that clause because I think it points up again the deficiency in the Bill.
The second observation I make is this: Why is there only 30 days for registration after this Bill is proclaimed and translated into law? It is not merely out of consideration of those who will be involved; it is a consideration of those civil servants of the country who will have to deal with the matter. It would seem to me to be more in accord with realism if the Government were to extend’ that period of 30 days to 60 days. It is an entirely personal observation. I think that 60 days would enable the processing to be done with greater measure of reasonableness than would be possible with the 30 days.
-My remarks are exclusively and briefly directed to clause 7 1 which governs the grant of licences by the Commission. I simply inquire of the Attorney-General whether it would not be an act of grace and an act of recognition of the status of existing stock exchanges, and whether the Attorney-General might give consideration to the suggestion that members of existing stock exchanges be given, in the absence of good reasons to the contrary, in effect an automatic grant of a licence. I think there is something which is capable of odium attaching to a procedure whereby every single member of an existing stock exchange, even those with an impeccable reputation, should feel that their right to carry on their profession is in some way in dispute.
– The 30 days period mentioned by the honourable member for Moreton (Mr Killen) is a matter of personal opinion. I would have thought that, with the enormous amount of publicity being given to this measure and the publicity that will continue to be given to it, there could hardly be a dealer (stockbroker) in the country who does not know that legislation of this sort is in train, and that the 30-day period would be sufficient. On the other hand I can well understand the honourable member thinking that 60 days might be a more generous period. The Government will watch it very closely.
– They are words I have had ringing in my ears from dealing with some of my clients.
– Is the honourable gentleman being paid? In reply to the other point made by him, I have to admit that the thought which entered his head and to which he gave expression here today crossed my mind as well. However, of course, it is put that one has to create an objective yet flexible set of qualifications for the licensing procedures. There is no doubt that there are many eminent men in the industry at the moment- I will not use names here- and one would hesitate to say that they should have to subject themselves to the filling in of forms, getting character references and matters of that sort. I imagine that is what is in the honourable member’s mind. The matter is under review. At the moment the balance leans heavily towards a fresh start. There is nothing offensive in a person saying he is qualified. The mere fact that a person has carried on his occupation for so many years speaks for itself and it is largely a pro forma matter. I take the honourable member’s point. As I said, we are trying to be flexible in this matter and we will keep it under review.
-I wish to speak to clause 70, which relates to the application for the grant of a licence. I have just a simple question regarding clause 70 (2) (b). I ask the Attorney-General whether the Commission could be given a discretion. I know that we have spoken about this Bill containing too much in the way of granting discretions, but here we have a very strict rule regarding a 30-day period before the expiration of the last previous licence of the kind referred to. I wonder whether in the case of genuine error there would not be room for a discretion in the hands of the Commission. I make no further point than that.
In respect of clause 71, the use of the term applicant’- I am thinking particularly of clause 71(1) (b)- ignores the fact that a large number “ of dealers are in partnership. I think that some cognisance should be taken of the assets of the whole partnership. There are many young people, for example, who simply could not enter into a partnership if they had to comply strictly with clause 71.1 think that is an important point to be noted.
– I raise a point in respect of clause 66. 1 ask whether adequate notice will be given before the intention to proclaim the provisions in respect of licences. I am advised that additional time will be necessary. I seek that assurance.
– I take it that the honourable member for Curtin (Mr Garland) is referring to the proclamation of the Bill when it becomes law. I mentioned before, in a different context, the relationship between this Bill and the proposed Bill that I hope to be introducing here very shortly, namely, the Administrative Appeals Tribunal Bill. The time lag there, if it becomes necessary, can be used to gear the 2 pieces of legislation together so that they will complement each other and achieve the end that the honourable member has in mind.
Clauses agreed to.
Clauses 82 to 87- by leave- taken together.
The DEPUTY CHAIRMAN (Mr Armitage)- I call the Minister- the honourable member for Moreton. I nearly said ‘the Minister for Moreton’.
-Mr Deputy Chairman, you are getting desperately close.
The DEPUTY CHAIRMAN- That was in the past.
– I see. There have been those who have been restored. Lazarus was a conspicuous example. In relation to clause 83, 1 asked the Attorney-General earlier in the Committee debate about financial journalists being registered. I find myself in agreement with the proposition, but the definition of ‘financial journalist’ seemed to me to be too restrictive and not to meet the simple facts of life. The Committee will recall that the financial journalist was described as one who contributed to a newspaper or periodical. The proposition that I put to the AttorneyGeneral was simply that there would be many people who were in fact financial journalists but who would not come within the definition. I hope that the Attorney-General, who is well on his way to succumbing to reasonableness, will concede that the point is made and will say with encouraging readiness: ‘We will do something about this’.
-I refer to clause 83 in the same spirit as the comments that I made on the last 2 clauses. This refers to the register to be maintained by a person who is the holder of a licence. In practice, of course, most persons are involved in a partnership. Therefore clause 83-1 think particularly of clause 83 (4)- is of practical value only if the partnership as a whole, rather than individual members of the partnership, holds the licence. So I just commend to the Attorney-General the idea that in respect of clause 83 (4) he could give attention to the thought that while we in the Opposition do not oppose the idea of the register we do think there is value in recognising that the partnership as a whole has an interest that could be recorded in the register and that because of fluctuations in the market a particular partner’s share will vary literally daily. If account could be taken of this, we would be quite happy with the provision.
Clauses agreed to.
Clauses 88 to 104- by leave- taken together.
– I refer to clause 90. 1 do not wish to do other than to say that this clause, on the face of it, raises some perplexing problems but there may be a simple answer to them. I do not wish to do anything other than to bring the Attorney-General’s attention to the fact that in practice the clause may be more difficult to implement than appears on the surface. I think in particular of clause 90 (2) (a) (i). It provides a 3-day period before which the dealer will deposit certain documents referred to in that clause. I ask the AttorneyGeneral: What is the objection to deposit of securities for loan if the client in fact gives permission? I see no reason why there should be a 3-day period. There may be some reason but it is not apparent. In sub-clause (3) again there is almost the opposite situation where there is almost a 7-day period of grace for the dealer. I wonder why it is not proper for the documents to be withdrawn if in fact the deposit is made immediately from funds which are paid from the client into the general account. I make no further point than that.
– I raise a practical point on clause 91(2). I am quite aware of the enormous desirability of having such a requirement. Having handled and continuing to handle trust moneys I fully understand the desirability. I just wonder whether the apparent automatic penalty imposed by sub-clause (5) could perhaps be ameliorated by the inclusion of some words to the effect of ‘without reasonable cause’. I am just a little concerned at the sort of holiday situation that might possibly arise where for extremely good reason a payment of moneys that ought to be held in trust is delayed beyond the requirement in sub-clause (2). I think the Attorney-General (Mr Enderby) understands the practical point to which I am alluding.
– Dealing with the last point first, the Government is acutely aware of the importance to be attached to the concept that trust accounts should be kept separate; in other words, that an agent’s moneys should be kept separate from the moneys of his client, whether the agent be a solicitor, stock-broker or dealer, to go back to a dispute I had earlier with my friend the honourable member for Moreton (Mr Killen). Otherwise there is chaos and a lowering of business morality. There can be little doubt that battles were fought and won several hundred years ago on this principle. We wish to extend such principles into this legislation to cover a field where they do not exist at the moment and where it is widely believed that abuses exist.
One has to declare principles in legislation, as they exist everywhere else, in the nature of an offence. First the duty is set out, then the breach of the duty and then that an offence exists if there is a breach of the duty. So it is set out. First is the duty that is brought to the attention of the dealer that he shall pay into account all moneys held by him in trust for his client and keep them separate from his own. Surely there can be nothing but applause for that. Sub-clause (5) provides the penalty for a contravention or breach of that duty. This provision is similar to provisions contained in legal practitioners’ ordinances and Acts all around Australia, as I remember them. I see nothing wrong with it. There may be occasional cases where a man says, ‘I am sorry, I made a mistake’, or ‘I forgot’ or ‘I mixed them up, I will not do it again’. In such cases there is first the discretion of a prosecutor, an informant in any system of law, whether to lay a charge, to bring proceedings under this or any other legislation. That is the first safeguard. The second safeguard of course is the discretion of the presiding officer above the prosecutor not to offer evidence. This safeguard exists in any system pf law, including our own. Finally there is the magistrate or the judge beyond that Surely one cannot argue in this day and age that it is not important to remind brokers and dealers that they must keep their funds separate from the funds of their clients. That is all I have to say to the point raised by the honourable member for Bennelong (Mr Howard).
The honourable member for Balaclava (Mr Macphee) raised a point in relation to clause 90. That clause contains an attempt by the Government to deal with a current abuse, something that in the world of law is taken for granted as being wrong, namely, a pledging of someone’s else’s securities to raise money on one’s own behalf. To lawyers nothing could be more axiomatic. Nothing could be so palpably wrong and wicked and deserving of punishment. It would be wrong for an agent, a solicitor or a stockbroker in possession of securities on behalf of a client with an obligation to do the r’ght thing by him, behind his back and without his knowledge, to pledge them at the agent’s bank to raise money to bet on a racehorse, to build a house, to pay his golf fees of whatever the purpose happens to be. That sort of conduct is forbidden in every other area of law. We seek to forbid it here.
I suppose it comes back once again to the fact that this area of activity, the securities industry, has for a long while been immune from most of the normal legal standards that apply to the rest of the community. That is why the abuses have grown up and the laxity, negligence, carelessness and the occasional piece of wickedness have occurred. I certainly agree with honourable members that one could argue about the form of the words. There are always a dozen different ways to write what one wants to write but the gist of the provision is that the dealer who receives documents of title to securities for safe custody must cause them to be registered and if requested by the client, to deposit them with a bank. Running through the whole scheme of things is that the client must be told of what is done.
If one reads the Rae Committee report one realises quickly that it became quite a prevalent practice in the securities industry for the client not even to be told that his securities were dealt with by his servant, his agent, in a way that he did not know about. Quite often one would get competing equities in a situation like that. I hate to put my mind to what it would take to resolve such conflicts. This legislation at least seeks to solve the problem and I think does so admirably. Clause 90 gives effect to the view that the pledging by dealers of clients’ documents of title should be subject to strict controls. Clearly the dealer should not be permitted to pledge such documents for his own purpose if the client is not indebted to the broker and has not consented. Even if the client is indebted to the dealer there should not be an automatic right to pledge without a specific warning notice. As I have said, in other fields of law the right to pledge is normally subject to such requirements.
– I agree with what the Attorney-General (Mr Enderby) has just said. I merely say that where the client comes within the provisions of the sub-clause I just do not see why he should have the 3-day period involved. It seems an anomaly. I agree with what the Attorney-General said. I point out that where the client has given permission a period of 3 days seems to me to be unnecessary.
-My plea to the Attorney-General (Mr Enderby) in respect of sub-clause (2) is purely related to time. I accept and endorse all of the arguments that the Attorney-General has advanced. I am just worried about the requirement that the words of the sub-clause are mandatory. To the best of my recollection and belief in New South Wales, for example, the Legal Practitioners Act does not impose any time limit; it simply imposes the requirement that the money should be held in trust and kept separate. I just ask the AttorneyGeneral to consider the possible relation of subclause (5) on the time limit in sub-clause (2).
Clauses agreed to.
Clauses 105 to 113- by leave- taken together, and agreed to.
Sub-section ( 1 ) does not preclude a person purchasing or selling securities or causing or procuring the purchase or sale of securities-
– I move:
In sub-clause (2) (a), after ‘exchange ‘, insert ‘if the person complies with the prescribed requirements’.
This is a simple, almost procedural, amendment to enable the making of regulations to regulate the conditions under which a broker can act as a principal in the ordinary course of trading on the stock market. For example, the regulations or the rules could regulate effectively the practices of floor traders which do, on occasions, require special attention and those members of the stock exchange who deal solely or mainly for their own account.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 1 1 5 to 1 1 7- by leave- taken together.
-The Opposition is opposed to clause 115 which seeks to prohibit a member of a registered stock exchange from being a director of a registered corporation. I hope that the significance of this will be clearly understood by the Committee. The Attorney-General, with almost religious fervour, has refrained from defining the term ‘stock brocker’. But under this clause any share broker is denied the right to be a director of a company. At first blush that may seem to be an appealing proposition. But is it? Insider trading is something that I look upon, and I am sure all my colleagues on this side of the chamber look upon, with unfeigned disgust and disapproval. That is rather strong language to use but I hope there is no person in any doubt as to what we mean by it.
It should not be imagined that because a person is a share broker he should disqualify himself by dint of that from being the director of a corporation. I mention some of the people who would be denied the opportunity of sitting on boards in Australia today under this legislation. Sir Ian Potter, a very respected Australian who has served this country’s interests in a great variety of ways. Mr A. C. Goode: It would be absurd to say this of him that because he is a share broker and falls within definition of a dealer, he should be disqualified. Mr Campell Johnston: The fact that he happens to have an association with my Party, I think, is irrelevant. I for one have never offered the slightest complaint about the fact that Mr John Egerton, with whom I have been on friendly terms for many years and who is a distinguished member of the Australian Labor Party, serves on various boards. I do not regard that as a disqualification. No political party has a monopoly of common sense, nor, indeed, of integrity. I mention another, Mr John Valder, who is well known and well respected in this country. Is it suggested that as a consequence of these people being share brokers they are debarred under this clause because of the possibilities of a conflict of interest?
The Attorney-General knows only too well that when it comes to a conflct of interest the very proper thing to do is to reveal that interest. It is a matter of public record that my view is that if there is no feel for honour and for integrity it is not possible to legislate for it. I stated this when giving evidence before the Joint Parliamentary Committee on the Pecuniary Interests of Members of the Parliament. If a man is not prepared to be frank and fair with his fellows and with the community I do not think that any gathering of legislation will oblige him to respond in that manner. I do not seek in any way to embarrass my distinguished friend, the honourable member for Phillip (Mr Riordan), in alluding to that. I mention it in passing. Whatever views his Committee will offer to the Parliament are the prerogative of the Committee. There are many other people who are in a position of fiduciary responsibility and trust who would be in a position comparable to that of share brokers who are directors of companies in offering themselves financial gain. For example, take a solicitor with a substantial commercial practice. He is not precluded by dint of this legislation from sitting on the board of a company.
– Move an amendment.
– I am sorry, but I tell my friend in blunt frankness that as this Bill came before us only on Thursday of last week, not even my inadequate mind or fertile mind- depending on where one stands in the matter of prejudice- has been able to draft appropriate amendments. Is it seriously suggested by the Attorney-General that a solicitor with a large commercial practice is in no prospective position of advantage if, out of a sense of avarice or venality, he wants to -
– He might act for a competitor.
-Precisely. I am indebted to the honourable member for Bennelong for his interjection. The solicitor may act for a competitor and unless he has a readiness to make a revelation and to act fairly he cannot be dealt with under this measure. I mention also the case of a banker; he is not precluded. A director of a trading bank may be in a position to benefit enormously from information given to him or acquired by him through his presence at a directors’ meeting. One could take any person at all and find oneself coming back constantly to the one position.
I think the Government, upon close reflection, will seek to make some modification to this provision. It seems to represent the high-water mark of unreasonableness as far as share brokers are concerned. It is my hope- whether it will be fulfilled only the future will show- that the Attorney-General will understand the force of the argument against this provision and will indicate to the Committee that he will- to use timehonoured language in this place- have second thoughts and put the matter under close and constant review.
-In supporting the remarks made by the honourable member for Moreton (Mr Killen), I merely refer the Committee to the provisions of clause 39 of this Bill and the arguments advanced by the Attorney-General in answer to a query that I raised. Apparently in respect of membership of the Commission it’ is sufficient if members disclose their interest. There is no disbarment for a member of the Commission to hold an interest in a corporation in respect of which a decision might be made by the Commission. Apparently a person who happens to be a stockbroker or, to use the language of the Bill, a dealer and who may not have potentially the same right to affect the fortunes of the shares of the company of which he might aspire to be a director, is to be placed under a more severe penalty than is a person who is a member of the Commission to be established under this Bill. It seems to me that if the Government is really serious on the issue of conflict of interest, of fiduciary responsibilities, there has to be some consistency about the matter. The Government should either afford the same respect to the integrity of dealers under clause 1 15 or impute the same motives of malice to members of the Commission that it apparently imputes to dealers under clause 115. I do not think that the Government can have it both ways.
I find quite unreal the proposition that the legislation presumes the abuse of inside knowledge and a breach of fiduciary duty. Certainly there is plenty of evidence to support my contention. It has been alluded to time and time again by Government speakers during this debate. Indeed, when they run out of logical explanation to support a clause in this Bill, the standard fallback argument is ‘Oh, look at what the Rae Committee said’. I accept what the Rae Committee said. I accept that there were some abuses and that some dealers, or stockbrokers as I prefer to call them, abused their inside knowledge and their privilege. To deny to the commercial life of the City of Sydney or the City of Melbourne- indeed of any of the major cities of Australia- the advantage and expertise that many dealers will be able to bring to the commercial affairs of companies is to be totally unrealistic. It is quite inconsistent to impute to them a considerably lower degree of honour than is to be imputed to other members of the commercial community and to members of the Commission who, I think everybody in this Committee would concede, will have enormous powers under this legislation. I totally share the remarks of the honourable member for Moreton that the Opposition is quite opposed to this clause.
-Like the honourable member for Moreton (Mr Killen), I suggest that the Attorney-General might look at a couple of provisions. I suggest that the following paragraphs should be added to clause 115:
I note what the honourable member for Moreton has said, but it was symptomatic at the end of the mining boom that many companies were floated- I think this is what we are worried about- for the declared purpose of acquiring shares in other mining companies or of profiting from trading in a particular commodity. Inevitably, sharebrokers could boost their normal commission income by obtaining directorships of companies and making share purchases through sales in their office. This happened with Poseidon, Queensland Mines Ltd, and Mainland
Corporation Ltd when in fact directors were underwriters or brokers and recommended shares to their clients. I think this happened with Australian Continental Resources and the Trendex Mineral Corporation. They all proved adept at generating commission income for sharebroking directors whilst failing dismally and returning nothing but losses for their shareholders.
In the advisory capacity towards the client it is obvious that the sharebroker and director faces another conflct of interest. This was not mentioned in the Rae report and I am not relying on that report. Companies desirous of expanding or perhaps suffering temporary liquidity problems may need borrowing and/or an injection of new capital. Difficulties arise, particularly during a period of tight money, when banks and finance nouses become unco-operative. We have been through this position. If a company’s shares stand at close at their par value on the marketshareholders, like investors, are loath to pay 50c for an item if they can get it for 45c- both the company’s welfare and even possibly the directors job may require that shares stand at a healthy premium on the market if the new issue of capital is to be raised. I thought that would have been obvious. Lenders of fixed interest money quickly become aware of the low share price, and this is a prime indication of a poor dividend covering falling profitability. The highest interest rates are obviously desired.
I put this to the Attorney-General in all fairness: How then can a sharebroker-adviser, unless he is an outstanding leader in his field, not recommend for purchase of shares in a company of which he is a director? The unwitting investor all too often jumps to the conclusion that the reverse is true; in other words, that his adviser, being a director of the company, is privy to all sorts of possibilities. It is interesting to note that since 1969 the rules of the Perth Stock Exchange explicitly forbid a member being also a company director. In view of this local ruling, which has been both agreed and enforced by the Western Australian share-brokers, I cannot understand the statement of Mr Valder, the Chairman of the Sydney Stock Exchange, which appeared in the Australian ‘ only recently:
We believe that such areas of potential conflict can probably be regulated with appropriate penalties, but that brokers should not be singled out and totally banned from acting as directors.
I agree with that but only on the ground that the Attorney-General expand the clause by the inclusion of the 2 provisions to which I have referred.
– I should like to add some words to what has already been said regarding the discriminatory aspects of clause 1 15. Again we have heard, as we heard before the suspension of the sitting for dinner- it is a point that I then had to make and I make it again- that much of this legislation is apparently couched in terminology which presumes that there is a degree of default. Again we have heard the mining boom taken as an example. As I said earlier, there is no question that the situation as pertained then was most unsatisfactory in many respects. Certainly I am well aware that stock exchanges in Australia- certainly the Sydney Stock Exchange, with which I am more familiar- have made substantial changes in their regulatory procedures and so forth, specifically to try to overcome many of the problems which have been raised in the Rae report and elsewhere.
For example, at present every member company of an exchange is required at the bottom of its statement which is sent out to clients on a monthly basis, to state quite clearly the company’s interest in the shares that it is recommending to clients. Perhaps the AttorneyGeneral regards this as being pretty basic, and I think it is, but the point is that it is a real step forward. I think that it is frankly absurd to suggest that only brokers who are members of boards are to be regarded as something different from any other section of the finance industry which, as the Attorney-General is well aware, has very wide ramifications. For example, if the merchant banks are doing their job they are at least as aware of the financial relationships of their clients as is any broker if he is doing his job. To say that a broker- not a broker’s employee so much as a specific member of a company which is a member of an exchange- should be denied what I regard to be a not unreasonable interest in companies which he presumably has been asked to join because of his knowledge, is to suggest that the corporate body of Australia, which already does not have that much talent, is to be deprived even of the additional potential of getting good people from the stock exchange.
I draw a distinction between what I have just said and the point made by the previous speaker, the honourable member for Hawker (Mr Jacobi), that some brokers- allegedly again during the period of the mining boom- were associated with companies specifically established to trade in other people’s shares. I think we need to make a distinction between that sort of operation and what is obviously a bone fide case. Sir Ian Potter was mentioned by the honourable member for Moreton (Mr Killen) as the son of gentleman who would be an asset to any board of directors. It is absurd to suggest that such people, with considerable qualifications as he has, should be denied the opportunity to make a very real contribution to the corporate life of the community.
We have also heard much about the idea that a lot of this legislation allegedly is drawn from the previous American experience. I wonder whether that is the case. Professor Louis Loss, who was brought here last year by the Government to give it advice on this very Bill, was asked the following question:
Does the SEC -
That is the American body- have any views on a broker being a director of a company?
The Professor’s reply was:
As far as I know, and I am quite sure that it does not, it is not suggested that brokers have to go off boards. Nor has there been any great movement that I am aware of in point of fact whereby brokers have gone off boards. But the insider trading laws that the courts have been developing in recent years have made it rather uncomfortable sometimes for brokers to be on boards. The SEC was reaslistic enough to say in a prepared report of some 10 years ago that it is impossible to avoid all conflicts of interest in the securities industry.
That is the experience in the United States of America. We have heard from the AttorneyGeneral and others how this Bill is supposed to follow that experience. This is one classic instance in which quite obviously the Bill has not done so. I cannot help but deduce from that that the Government is making a very subjective judgment on the basis of a series of specific cases and generalising on an industry. I do not regard that as being particularly fair. I submit to the Minister that a potential conflict of interest can arise whenever a person acts in a dual capacity in almost any sphere of human endeavour. All dealers, whether they be brokers or bankers, can still deal in both large and small blocks of securities; they can operate discretionary accounts; they can manage accounts; they can advise different people on corporate affairs; they can be involved as advisers in takeover situations; and they can participate in the many other activities involved in the capital markets. In fact, all of these people have conflicts of interest.
I would like the Minister to consider the following proposals: Firstly, that a dealer who, together with associated companies, owns more than, say, 50 per cent of the shareholding in a registered corporation shall not be permitted to be a director of that corporation without the specific approval of the Commission; secondly, that a dealer who is a director of a registered corporation shall not give any advice regarding investments in or the purchase or sale of any securities in that corporation and shall inform any client who requests his assistance of his interest in that corporation; and thirdly, that a dealer who buys of sells securities on his own account or on the account of associated companies or on account of clients of his company in a corporation of which he is a director shall advise the Commission on a monthly basis of the transactions which he has entered into in respect of the company in question.
-A number of points have been made by honourable members in expressing their concern about clause 1 15. 1 think it has to be conceded that this is a matter about which honest people can have a difference of opinion. I am glad to see that my friend the honourable member for Moreton (Mr Killen) has walked back into the chamber, because he is familiar with and frequently quotes the sayings of Edmund Burke who described one of the nicest legislative problems a parliament can have as what to legislate about and what not to legislate about or, as Jeremy Bentham once said, what should be on the agenda and what should not be on the agenda. People will take different points of view about this matter. The Government clearly takes the view that there is a need to uplift business morality in this regard.
It has been said that to date the Government seems to have been following the American model: It is true that we have been influenced very much by the American model, but the American model does not have a counterpart of clause 1 15. The Government has been influenced by the success of the American model. There has been a Commission in America since 1934, and the sorts of abuses that we have seen in our country in recent years have not occurred there to the same degree. The lesson we draw from that in part is that the mere existence of the Commission assists in that regard and perhaps, having a Commission, the Americans do not need this additional rule. It was interesting to hear the honourable member for Hawker (Mr Jacobi) point out that in Perth this rule has applied for many years. As I understand it, it was inserted there at the wish of the brokers, in a selfregulatory manner, to protect themselves from the criticism of a conflict of interests situation.
I can well understand the argument that the Government will rock the boat too much if it disqualifies brokers from being directors of companies. The answer to that surely is this: One should be concerned not only with the brokers as directors of companies but also with the clients or the persons who go to the brokers wanting good advice. There are far more clients than there are brokers. They are the public. As I have said so many times, this legislation is a two-fold measure. It aims to maximise the utility of the capital market and also to protect the consumer, the customer or the investor, who has been sadly defrauded in recent years. One cannot expect the customer to go to a broker seeking good independent advice, not knowing that the broker who is advising him has a number of directorships in the companies which are the subject of the very advice. To my way of thinking, that infringes all the elementary principles which are enshrined in so many other laws but which have not been extended to this area before. They apply to the Secret Commissions Act and laws regulating solicitors or the ethics of the legal profession and so many other professions, but not here. Only in recent years has the industry had the opportunity for abuse that we have seen revealed. That is why the Government says that this rule should apply. One may call it educative. One may say that the Government is leaning heavily towards protecting the consumer, although it is concerned with the role of the broker and the director as well.
The point was made by the honourable member for Bennelong (Mr Howard) that the Government does not apply this test to the members of the Commission. That is true. Of course, one cannot compare them. Members of the Commission are not traders. No one goes to them seeking advice. They are not allowed to be directors. If a member became a director of a company he would be disqualified forthwith.
– Their decisions can affect a company.
– Yes. They have to reveal any interests, but they are not permitted to be directors. We are talking about a broker being a director.
– But they can make decisions.
-The honourable member suggested that they might be directors. They cannot be. If he looks at clause 26 he will see that they are disqualified if they take a directorship of that sort. Surely that is the answer to the honourable member. They are not traffickers; they are not traders; they are not brokers or dealers in that sense at all. These five gentlemen, when chosen, will be the must esteemed people in that particular branch of Australian industry. They will be required to me by way of a register -
-In clause 26?
– Clause 26 (2) (c), I think it is. It works to that effect; it certainly does. We impose on such people a very high standard in revealing any interests at all. We impose the same high standard as we would require of a judge or an arbitrator to make known whatever interests he has. But one cannot compare a commissioner with a sharebroker. The roles of the 2 people are quite different.
– A judge does that voluntarily.
-He does it voluntarily; that is right.
-The simple point I make is that whereas under clause 39 it is possible for a member of the Commission to make a decision which will affect the commercial fortunes of a company in which he holds shares, it is not possible for a dealer in shares under clause 1 15 to be a director and therefore influence the commercial future of such a company. That is the analogy I draw. I think it is a valid analogy; I think there is a conflict. The Attorney-General (Mr Enderby) argues that the provisions of clause 26 prohibit a member of the Commission from being a director of any company. He draws my attention to clause 26 (2) (c), which reads:
– They would if I were in charge.
-We are talking about a legislative enactment of this Parliament and not the discretion of the Attorney-General.
– I must support the Attorney-General (Mr Enderby) in this matter. I cannot believe that any government, even a Liberal-Country Party government, would choose as a commissioner on a commission such as the one we are discussing in this Bill tonight a person with such Little integrity that he would not deduce from clause 26 (2) (c) that he must not be a director of any company that trades on a stock exchange. I do not accept the analogy of shareholding in this particular sphere but I would expect even then that the integrity would be such that there would not be a material shareholding.
However, that is not my purpose in rising to my feet. I rise to point out that there is no other analogy between a dealer who is a member of a stock exchange or a partner of a member of a stock exchange in the context of clause 115 which- you do not have to draw my attention to the fact, Mr Deputy Chairman- we are discussing. A merchant banker was mentioned and so was an ordinary banker. I must draw to the attention of the Committee the fact that neither of those occupations is such that a commission is involved in the turnover of shares. That point is all-important when we are discussing the matter of whether a holder of a dealer’s licence should be a director of a company.
Let me interpose here the comment that I believe as a chartered accountant that those firms of chartered accountants in the western world which have laid down that their partners should not be directors of companies have done a service to the integrity of the professional community of this country. One such company is Price Waterhouse and Co., the largest of the firms of chartered accountants, and one with which I have had no personal dealings at all. I understand that that firm does lay that down, and I think it is something to be commended. It still does not prevent a dealer who is a member of a stock exchange or a partner of a member of a stock exchange being a capital market adviser to any company, but a person who is an adviser in a particular field in which he is well qualified is different from a person who is a director with all of the responsibilities of a director.
I ask the Committee also to consider the fact that we are dealing with legislation which arises out of many problems which occurred in this country’s capital market at the time of the boom, particularly the mining boom. I suggest to the Committee that if indeed the members of a stock exchange and the partners of members of a stock exchange who are dealers in this field had devoted their entire attention to the matters which were the subject of their main calling- in fact, they are dealers in that market- we might have had many fewer problems than we have had. It was the people who were the directors of Poseidon NL and directors of other companies involved in this field who are also members of the stock exchange who by their actions gave rise to so many of the problems which have been brought out by the Senate Select Committee on Securities and Exchange. I will not detain the Committee any longer. There are other points that I would like to make, but I merely say that I support clause 115 and hope it will not be altered.
-By the inclusion of clause 115 in the Bill the AttorneyGeneral (Mr Enderby) has shown that he understands the dilemma. I am sure that this matter will be debated in the Senate. I wish to agree with the remarks made by my friend, the honourable member for Bennelong (Mr Howard). Beyond that it is sufficient to say that the matter has been open for debate. I am sure that it will be debated more fully in the Senate.
Clause 116 deals with the question of the dealer not being able to act as an underwriter in certain circumstances. I wonder why that clause does not apply to all of those people who are circumscribed by the definition of ‘dealer’ in clause 3. I simply ask the question. If the AttorneyGeneral is not in a position to answer it now it may be answered in the Senate.
Clauses agreed to.
The Trade Practices Act 1974 applies in relation to, and in relation to the making or entering into of, any contract, arrangement or understanding having the purpose or effect of fixing or controlling, or providing for the fixing or controlling of, the fees or charges for, or any discounts, allowances or rebates in relation to, any goods or services supplied or to be supplied by such of the parties to the contract, arrangement or understanding as are the holders of dealers licences, or by any of them, in the course of carrying on a business of dealing in securities to persons not being parties to the contract, arrangement or understanding and so applies as if every such holder of a dealers licence were a corporate within the meaning of that Act.
Omit ‘carrying on a business of dealing in securities’, substitute ‘dealing in securities of prescribed corporations’. At the end of the clause, add the following sub-clause:
This section does not affect any application that the Trade Practices Act 1974 would have apart from this section’.
The explanation of those amendments is quite simple and probably clear on the face of it. The first amendment is simply designed to ensure that the provision is clearly within constitutional power. The reference to securities in the present clause might otherwise be construed as a reference to securities of corporations that are not prescribed; that is, corporations over which the Australian Parliament does not incontrovertibly have power to legislate. The second amendment is to ensure that the ordinary operation of the Trade Practices Act is not restricted by implication from the provisions of clause 118 (1). That clause is intended to ensure that the Trade Practices Act applies to dealers. It is not in any way intended to limit the operation that that Act would have in the absence of clause 118(1).
Amendments agreed to.
Clause, as amended, agreed to.
Clauses 1 19 to 130- by leave- taken together.
– I refer to clause 1 19 merely for the purpose of drawing the attention of the Attorney-General (Mr Enderby) to the submission of the Australian Associated Stock Exchanges of which he and the honourable member for Adelaide (Mr Hurford) are aware. Clause 1 19 is a provision which refers to stock market manipulation. The Association has simply said that this clause ought to have regard to the provision in section 71(2) of the New South Wales Securities Industry Act. I know that the Attorney-General has the submission before him and I know that he cannot in any political sense accept the suggested amendment tonight, but I do suggest that he give regard to it when he considers this Bill prior to its going to the Senate.
I refer also to clause 123, which is a very important clause. I am sure that my colleagues will speak to it. Clause 123 relates to the prohibition of dealings in securities by insiders. I would simply refer the Attorney-General again to the publication to which the honourable member for Adelaide has referred and which was prepared by Louis Loss. It is a publication that was printed by the Government Printer under the auspices of the previous Attorney-General. I refer in particular to paragraph (d) at page 22, which expressly relates to clause 123 of this Bill. I think that I should read paragraph (d) for the purpose of illustrating the kind of problem that arises under clause 123. It reads:
Suppose that the loan officer of a bank discovers that a corporate applicant for a loan is in a bad way. Should he inform his colleagues in the bank’s trust department, so that the shares of that corporation may be sold out of the trust accounts? If he does, is not the bank culpably acting on inside information? If he does not, might the bank in its capacity as trustee be guilty of a breach of trust? Many American banks have sought a way out of this dilemma by creating intracorporate ‘Chinese walls’ between their loan and trust departments.
– Bamboo walls.
-Thank you. Pararaph (d) continues:
But is it clear that the courts would not attribute to the corporation as an entity the information obtained by its loan officer? About the only thing that is clear in the United States is that a trustee’s duties under the law of trusts can hardly require him to commit a violation of federal law. The Code intentionally leaves for further judicial development the question of the efficacy of ‘Chinese walls’.
I have simply drawn that matter to the AttorneyGeneral’s notice. It is unrealistic to expect the Attorney-General to have particular regard for that now, but I do hope that by the time the Bill reaches the Senate he will have done so.
– I refer to clause 129 (7) (c), which provides that the directors of a registered Australian corporation shall, if significant changes in the non-current assets have occurred in the financial year, cause to be included in the accounts a statement setting out particulars of the changes. This comes back to the point I made in relation to the definitions clauses when the Committee stage of the debate commenced. As far as I am aware there is no definition of ‘current assets’ or of ‘non-current assets’; yet here we have an explicit reference to it. This provision is really capable of all sorts of ambiguity, as the honourable member for Adelaide (Mr Hurford), who is interjecting and who used to be an accountant- I do not want to slight that organisation- knows. The honourable member will know if he has looked up clause 3 that the term ‘current liability’ is defined. Therefore, why not define the term ‘current assets’ and be complete about the matter? It may be said that this is the definition of the States. Surely it cannot be argued that we should preserve in this legislation any deficiencies that exist in the State laws now that the Commonwealth has seen fit to take over in that area.
I find sub-clause (7) (e) of clause 129-1 will spare the Committee a reading of it- very difficult to follow. I hesitated then because I was going to say that I find it to be meaningless. I invite the Attorney-General to tell the Committee what clause 129 (7) (e) means. I think that it is very confusing. I just cannot accept the argument that the Government has had so little time in which to work on this matter that it cannot make the provision clearer. The AttorneyGeneral may think that it is clear and may be able to explain what it means, but there are many people in the community who cannot understand it.
I refer also to clause 130 and Schedule 3. 1 am interested in the particulars on which directors are to report, as set out on pages 222 and 223 of the Bill. They certainly have to disclose a lot. One would not necessarily quarrel with that without examining the matter in detail, but I was rather struck by the provisions of paragraphs (y), (z) and (za) of the Sechedule, which indicates how many items there are. What are some of the things that the directors have to disclose in their reports? Paragraph (y) refers to the particulars of any arrangements made by the corporation during the financial year for protecting the safety and health of its employees. Paragraph (z) refers to the particulars of any arrangements made by the corporation during the financial year for protecting the safety and health of the public in relation to the activities of the corporation and for protecting the environment. Paragraph (za) refers to the particulars of any arrangements made by the corporation during the financial year for the protection of consumers of goods or services supplied by the corporation. That is pretty loose stuff. I ask whether it is intended that there by regulations more closely defining exactly what is meant there. It must be obvious that that covers a very broad area. They are very generalised statements. If the directors are able to give generalised replies their replies will be valueless. If they are to be fairly specific, and obviously what is intended here is the protection of employees, consumers and others, they are presumably entitled to know exactly what they as directors are to report on and what policies their companies are expected to carry out.
I summarise the position by saying that I would like some indication as to whether it is. intended that there be further regulations setting out specifically, and not just in a waffling form, what is intended there and, referring to clause 129 (7) (c), by asking why can we not have a definition of the term ‘current assets’ as there is a definition of the term ‘current liabilities’ in the definitions clause and whether the AttorneyGeneral can explain what clause 129 (7) (e) means?
The DEPUTY CHAIRMAN (Mr Drury)Order! The question is: ‘That clauses 1 19 to 130 be agreed to’.
– I rise to a point of order, Mr Deputy Chairman. Does that mean that the Attorney-General is declining to answer questions asked by the Committee?
The DEPUTY CHAIRMAN- It is a matter for the Attorney-General.
– Let me say, Mr Deputy Chairman, that the House of Representatives has spent the -whole day so far on this Bill. I have indicated oyer- and over again that the Government will keep the whole measure continually under review and that it is paying close attention to everything that is being put by Opposition spokesmen. At this stage the Government sees no real point in changing the measure but it is indebted to the honourable member for Curtin (Mr Garland) for his suggestions.
Clauses agreed to.
Clauses 131 to 159- by leave- taken together, and agreed to.
Without prejudice to the effect that this Division has apart from this sub-section, this Division also has the effect it would have if-
In sub-clause ( 1 ), omit paragraph (d).
This is an amendment consequential upon the omission of sub-clauses (12)” to (16) of clause 162. 1 should inform honourable members in advance that in the event there of a failure of registration the Bill as it stands at the moment does allow, some would say, a Draconian civil remedy in damages to be given to a person suffering loss not from that cause but from some other cause that would be unrelated. It is thought by the Government to be unnecessary. We believe that the normal criminal law is adequate. The purpose of this amendment is to delete that measure.
Amendment agreed to.
Clause, as amended, agreed to.
1 ) A person shall not-
If an invitation or offer is issued or made in contravention of sub-section ( 1 ), the corporation and every person who is knowingly a party to the issuing of the invitation or the making of the offer are each guilty of an offence and punishable, on conviction-
At the end of the clause, add the following sub-clause:
This section does not apply to a take-over offer or a take-over invitation. ‘.
The reason for this amendment is that separate and special provisions are provided for takeovers in Part X, and honourable members might also note Division 2 of Part VII which deals with a report akin to a prospectus where securities form part of the consideration for a take-over. This amendment is to ensure that it is clear that the special provisions only are to apply to an oflfer or invitation where a take-over is involved.
Amendment agreed to.
Clause, as amended, greed to.
Where a prospectus has been issued, circulated or distributed in contravention of paragraph (l)(a), any prescribed person is liable, upon demand being made in writing by a person who subscribed for shares or debentures to which the prospectus relates, to pay to that person-
the value of the shares or debentures as at the time of the disposal, whichever is the greater- the amount of the excess; or
The following persons are prescribed persons for the purposes of sub-section (12):-
– I move:
In sub-clause (10), omit all words after ‘distribution’, substitute ‘ of a prospectus in relation to an exempt corporation ‘.
Omit sub-clauses ( 12) to ( 16), inclusive.
These are the amendments I referred to earlier. The words omitted are unnecessary in view of the definition of ‘prospectus’. This definition includes a notice, circular or other instrument so that the use of the word ‘prospectus’ does not change the meaning of the sub-clause but shortens and simplifies it. The second amendment to clause 162 is, as I informed honourable members, designed to eliminate a civil sanction for failure to register a prospectus. We accept that the criminal law is adequate. After careful reconsideration the Government has decided to remove the unusually broad civil sanction originally provided by clause 162 ( 12). The Government considers it will be sufficient for the Bill to rely on the criminal sanction provided in clause 162 (2) to enforce registration.
-I think it is wise that the Government has decided to remove those Draconian costs which would apply to people who transgress the legislation. As a general comment I think the clause will still as presently drafted create some serious practical difficulties so far as it affects companies’ rights and capacities to raise funds on the open market. Companies making a rights issue, for example, have to register the prospectus with the Commission as required by this legislation, and the possibility of an extended delay due to the fact that sub-clause (3) requires the Commission to investigate and satisfy itself that the requirements have been comphed with will make it very difficult for companies to pitch the terms of the issue to meet the requirements of the Commission. The company cannot plan with any degree of certainty as to when the funds will become available and as to whether the Commissioner will necessarily accept the basis on which the issue has been made.
Sub-clause (7), for example, introduces into Australia, I understand for the first time, the concept that after a prospectus is registered with the Commission and application lists have been opened, the Commission may still cancel the registration. This provision suggests that a cancellation may occur at any time notwithstanding that the company may already have a lot of securities pursuant to the terms and conditions of the original prospectus. Furthermore, cancellation of the registration of a prospectus on this basis may mean that a prospectus has never been in fact registered, and the circularisation of an unregistered prospectus of course is something not permitted under this legislation. It seems grossly inequitable and impracticable to give the Commission such widespread powers to cancel as distinct from withdrawing the registration of a prospectus subsequent to its original registration or at any time without any other limitation on the conditions under such powers being able to be exercised.
Amendments agreed to.
-Clause 162 introduces a new concept of the cancellation of registration of prospectuses. The recommendation of the Eggleston report was that this was unnecessary. Accordingly, there is a strong view in some sections of the community that subclause (7) should be deleted. Clause 162 ( 1) provides for the registration of prospectuses. Subcause (l)(b) requires the prospectuses to state the date of registration which is a matter of practice in regard to printing which could cause significant delays in its issue. This is regarded by many as being a provision which is unnecessary and there is no reason why it should not bear the date of its signature by the directors.
Sub-clauses (5), (6) and (7) establish an important departure from the State Acts in regard to inquiries and investigations by the Commission for the registration of a prospectus, namely the discretion invested in the Commission to deny registration if it is dissatisfied as to the expert’s qualifications or experience, and to cancel a registered prospectus under the conditions mentioned in the last of the sub-clauses.
The point that I ask the Attorney-General therefore, is why this departure from the recommendations of the Eggleston Committee was made. As I asked in my second reading speech- I hope that the Attorney will respond to this- what happens if cancellation of the prospectus takes place after some shares have been issued? They cannot surely be called back. It is a very common procedure for shares to be issued as the applications are received and the prospectus at issue is open. That is a question which is naturally of considerable concern and I would like to hear from the Attorney-General. Will he tell me briefly exactly what will be the position on that cancellation? The legislation should revert, as is suggested by many, to the equivalent position in the State Acts as the Commission, even if it can be adequately staffed, simply cannot give effect to the new proposals. I would like a brief answer on this.
– Perhaps I could just say in reply to the honourable member for Curtin (Mr Garland) that we always listen very closely to what he has to say. The purpose of registration, of course, is to try to ensure that false documents in the nature of prospectuses are not circulated to induce people to part with their money as so often happens. That is the mischief we are trying to correct. But, as the honourable member pointed out, one cannot cater for everything. It might well happen that shares are issued and such a registration is cancelled. For what it is worth, my own view would be that the ordinary civil remedies would apply. The criminal sanctions, of course, might apply. It would depend on the facts. But the person in that situation would have his civil remedies as he has now.
Clause, as amended, agreed to.
Clause 163 agreed to.
Where an invitation or offer has been issued or made in contravention of sub-section ( 1 ), sub-sections 1 62 ( 1 2 ) to (16), inclusive, have effect as if-
Omit sub-clause (5).
This amendment is completely consequential on the previous amendment which sought to omit sub-clauses ( 12) to (16) of clause 162.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 165 agreed to.
Where, in pursuance of a prospectus referred to in subsection ( 1 ), a corporation to which Part III applies has accepted from any person any money as a deposit or loan, the corporation shall, within 2 months after the acceptance of the money, issue to that person a document that-
– I move:
In sub-clause ( 3 ), omit ‘ 2 months ‘, substitute ‘ 1 month ‘.
The reason for this amendment is that clause 166 (1) provides that a prospectus in relation to debentures must state that the corporation will issue a document evidencing its indebtedness within one month from the acceptance of money as a deposit or loan in response to the prospectus. This amendment is to ensure that the corporation is legally obliged to issue such a document within one month.
-We are dealing with debentures which affect a wide range of small investors and retired people. I understand that there are about 630,000 people who hold debentures or unsecured notes. The tragedy, whether we like it or not, is that many investors who hold debentures hold the false belief that they are the first to be paid in the event of the company being wound up. In fact criteria are laid down by the life offices to guard debenture holders. I sincerely suggest that the Government give consideration to the incorporation of those criteria in these provisions, to protect debenture holders. Building societies, for instance, in South Australia are not allowed, as to the honourable member for Adelaide (Mr Hurford) would be aware, by the Public Actuary to lend to big hire purchase companies. If that provision had applied earlier many small investors in Cambridge Credit would certainly have been saved. I think there ought to be more adequate provisions to cover debenture holders within the provisions of the Bill.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 167 to 170- by leave- taken together, and agreed to.
Clause 171 (Criminal and civil liability for statements in prospectus).
– I move:
At the end of the clause, add the following sub-clause: - “(14) This section applies in relation to a prospectus of which a copy has not been registered by the Commission in like manner as it applies in relation to a prospectus a copy of which has been so registered, but, for the purposes of the application of this section in relation to a prospectus by virtue of this sub-section, this section has effect as if a copy of the prospectus had been registered by the Commission at the time when the prospectus was first issued, circulated or distributed, as the case may be. “.
This amendment is consequential on the previous amendments I have moved which have been accepted by the Committee.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 172 to 174- by leave- taken together, and agreed to.
– I move:
In sub-clause (5), omit ‘issue’, substitute ‘date of registration of a copy’.
The reason for the amendment is that the date of registration of a prospectus will be a date that is certain and easily ascertainable. The date of issue might not always be incontestable and so ascertainable.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 176 agreed to.
Where a borrowing corporation is required by subsection ( 1 ) to make provision in any debentures or in a trust deed relating to those debentures for the appointment of a trustee corporation as trustee for the holders of the debentures, the borrowing corporation shall not allot any of those debentures until-
– I move:
In sub-clause ( 4 ), omit ‘allot ‘, substitute ‘ issue ‘.
The amendment will ensure that a corporation may re-issue debentures that have been redeemed. The use of the word ‘allot’, which is defined, would exclude such a re-issue.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 178 agreed to.
Where a corporation to which Part III applies invites applications or offers from the public to subscribe for or purchase debentures of the corporation or offers debentures of the corporation to the public for subscription, the relevant trust deed or, if there is no relevant trust deed, the debentures shall be deemed to contain covenants by the borrowing corporation to the effect-
– I move:
That after the word ‘subscription’, in clause 179 insert the words ‘or purchase ‘.
The reason for the insertion of the words is that they will ensure that the implied covenants provided by clause 179 will apply in a case where a corporation re-issues to the public debentures that have been redeemed.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 180 to 186- by leave- taken together.
-Before we pass clause 181 can I solicit an indication from the Attorney-General that he will give consideration to the points I have raised. Will he indicate that?
Clauses agreed to.
Notwithstanding any other provision of this Act, a notice, circular or other instrument inviting the making of deposits with, or the lending of moneys to, an exempt corporation as defined by section 159 or offering to accept deposits with, or loans to, such a corporation shall, for the purposes of this Division, be deemed not to be a prospectus in relation debentures of the corporation.
That after the words ‘not to be’ in clause 187, insert ‘an invitation to the public to make applications or offers to subscribe for or purchase debentures of the corporation or an offer of debentures of the corporation to the public for subscription or purchase and not to be ‘.
The reason for this amendment is that it is necessary to ensure that invitations or offers by exempt corporations are excluded from the operation of all provisions in Part VII including those provisions where the word ‘prospectus ‘ is not appearing.
Amendment agreed to.
Clause, as amended, agreed to.
-I raised last night the necessity for additional provisions to safeguard people with unit trusts and mutual trusts. Can I get an undertaking that the Government will give further consideration to this matter?
– Yes, most certainly.
Clauses 188 to 262- by leave- taken together, and agreed to.
Clause 263 (Power of Commission to obtain information, documents and evidence).
-This clause makes provision for the search of premises by the Commission if the Chairman or the Deputy Chairman has reason to believe that a person is capable of furnishing information. It makes further provision for the securing of a search warrant to enter premises any hour of the day or night and to seize any document, to search any place on the premises, to break open any cupboard, drawer, chest, trunk, box, package and so on. This search warrant can be secured by making application to a justice of the peace. In no way whatsoever do I seek to reflect upon probably one of the oldest judicial offices known to our system of law, but to be able to secure a search warrant in these circumstances from a justice of the peace is something from which I must confess, instinctively, I resile.
I ask the Attorney-General to consider the ramifications of this clause as it now stands. If a man came to my home and said: ‘I have a search warrant. I have obtained it from the justice of the peace. I want to come in’, and he comes in and I - say:. ‘Look old chap, I am not satisfied that what you are looking for is here’, and I put my hand up against him, within the meaning of this provision I would be obstructing or hindering him in the course of his duty. I would be subject to a fine of $1,000 or 3 months imprisonment. Of course, I would have to take the 3 months imprisonment. Looking at the honourable member for Adelaide (Mr Hurford) and the honourable member for Robertson (Mr Cohen), it would be a pleasure to get away from them for 3 months.
Great powers must be used with great discretion. I have always taken a certain view in regard to search warrants, which entitle a person to knock on the door and enter premises at any hour of the day or night. I have taken the view that this is a power that should be put into statutes with very considerable caution. I recall the occasion when Customs officers raided the home of a very distinguished Australian, Daphne Mayo. It happened that they had the wrong home. I was a private member sitting on the Government benches at the time and I complained, I hope with a proper sense of resentment, about the manner in which that raid was carried out. I ask a question of the AttorneyGeneral as the custodian of our rights, the protector of our liberty, the father protector. I must say that he will have to work hard to improve his image as it is at the moment. Nevertheless, I ask him: Will he please take into account the ramifications of this clause as it stands, and when this Bill trundles its way to another place will he seek to include adequate safeguards to take account of the fears that I have expressed?
– The honourable member for Moreton (Mr Killen) is always at his best on matters of this sort. I am advised that the clause is in the normal form, although that is no excuse for it. It has been copied from many Acts which were enacted during the life of the Government which the honourable member supported. I do not mean that in any offensive way.
– Do not blame me for all the sin in the world.
– No, of course not. I should tell the honourable member that I share his views on the right to search and to seize in a person’s home. I know that in the Australian Capital Territory, for example, it is one of my hopes that soon we will have the magistrates independent of the Attorney-General’s Department and given the security of tenure of judges. We certainly will give the closest consideration to the honourable member’s suggestion.
Clauses agreed to.
Clauses 264 to 267- by leave- taken together.
-Clause 267 is one about which I seek to make a few charitable observations. This clause gives a member of the Commission the right to attend a meeting of a registered stock exchange and a meeting of the board of directors, of members or a class of members, or of debenture holders of a corporation to which Pan III applies. So, for all practical purposes, the clause refers to all forms of corporations. A member of the Commission can attend, sit in and have a bit of a listen to what is going on. Really and truly, I ask the AttorneyGeneral: What is the rationale for having this incredible provision in the Bill! It seems to me to be unnecessary. Let us assume that members of the board of, call it Killen Enterprises for want of a -
– Another multinational.
– Yes, but benevolence marks all of its activities. Assume that we want to have a chat about some of the difficulties we are having with the Commission, this is on the agenda, the meeting is scheduled and a member of the Commission turns up. After saying ‘Good morning’ he is asked: ‘Will you have a cup of tea?’ He has a cup of tea and he waits for the meeting to start. He sits there as a statutory eavesdropper. It is an unbelievable circumstance. What would the Attorney-General think if I were put in the position where I could come along to and listen in on the chatting going on at a meeting of, shall we say, his branch of the Labor Party here in Canberra? I do not suppose that it would be a desperately well attended meeting, but I put that to one side. This provision seems to me to be an incredible invasion of privacy. I think that when the Attorney-General- who I am sure has inched his way manfully and reluctantly towards the state of reasonableness of which I spoke when we started on this Bill about 8 hours ago- is away from this place tonight and contemplating the labours that lie ahead of him tomorrow he will be attracted to this proposition. I believe that this is a completely unnecessary provision. I am sure that if the honourable gentleman looks at it earnestly he will come to the same conclusion.
-As regards clause 267, I do not want to add very much to what the honourable member for Moreton (Mr Killen) has already pointed out, save to say that the drafters of this piece of legislation, although one can appreciate their specific objectives, as the honourable member for Moreton said, of putting in a legislative eavesdropper on all meetings of the stock exchanges and corporations under Part III of the Bill, the fact of the matter surely is that we cannot legislate against actions which people intend to take in this manner, whether they be legal or illegal. I just give another example, if I may add to the one given by the honourable member for Moreton. If a person is a member of a board or committee of a stock exchange or a company registered with a stock exchange and for various reasons he does not wish to have present a gentleman from the Commission, he will simply arrange a private meeting. Presumably this is to be regarded as an illegal act under this legislation. The point I want to make is clear, and that is that if there is a will to transgress the law that will will prevail. I honestly question the legality of and implications associated with allowing public servants to be present at meetings of this type. It is important, as the Attorney-General has pointed out, that everything be above aboard and that the populace to be aware of all of the facts. I go along with all of that. I accept that. I simply question very fundamentally whether this is the way to do it.
– 1 merely draw attention again to the proposition that has been advanced many times during this debate by my colleague the honourable member for Bradfield (Mr Connolly), namely, that in many clauses in this Bill we find evidence of a presumption of wrongdoing and guilt on the part of stock exchange members and dealers. The honourable member for Moreton (Mr Killen) has categorised clause 267 in very eloquent language. I think it opens up a field for potential pimps. To write into a piece of legislation a provision that without the existence of any just cause, excuse or reason for suspecting wrongdoing an officer of the Commission shall be entitled to attend meetings of this nature is to so extend the surveillance of the Commission into the private affairs of members of an exchange as to defy justification. At no stage during the second reading debate did any honourable member supporting this legislation advance reasons for this sweeping provision. The conditions contained in the other clauses lay down very stringent surveillance measures. Before the Government commits itself irrevocably to clause 267 as it stands, just let it ponder for a moment precisely what it means. If the Attorney-General refers by analogy to other associations of professional people, is he suggesting for a moment that in future a member of the Australian Conciliation and Arbitration Commission should attend the meetings of the interstate executive of the Australian Council of Trade Unions? Is he suggesting that a member of the council of the law societies of any of the Australian States ought to attend partners’ meetings of the larger firms of the cities because at some remote time in the future some of the partners might consider a fiddle of their trust accounts? That is the sort of analogy that this type of proviso draws to mind. It represents such an intrusion into the normal commercial privacy to which people who are trying to carry on commercial activity would be subjected that I entreat the Attorney-General, if he is not disposed to take the requirement out, at least to write into it the proviso that there must be good grounds for a member of the Commission to attend.
– I listened with considerable care to the remarks of honourable members. This legislation, I appreciate, comes as somewhat of a shock to traditional Australian thinking on this subject. I should tell honourable members that during January I spent 3 weeks in Europe. I was amazed by how far European countries with a similar system of economy to our own have gone in this direction. There are good social reasons for it. I do not have to cite the example of Sweden. Of course, honourable members opposite would immediately dismiss Sweden as having a Labor type government, but Sweden has gone a long way in this regard and these measures are accepted generally in the community as very desirable. They are consistent with worker representation on boards. The same situation applies in the Federal Republic of Germany where I found enormous interest in this sort of reform. Oddly enough the West German Government also is of the social democratic type. I was more surprised to find that in France, which has a conservative government- some would say a right wing government- again enormous changes were taking place in company legislation in a similar direction. When I asked why this was being done I received different answers but they boiled down to this: Increasingly it is believed that decisions made in the board rooms of big companies are far too important today to be left only to the directors of the big companies, that the public interest is also involved. In Australia we are very remote and cut off in many ways from the mainstream of what is happening in a progressive way overseas and which is widely accepted by all sections of the population.
I quoted Burke to my good friend the honourable member for Moreton (Mr Killen) a little while ago. He might allow me the indulgence of quoting from John Maynard Keynes- not exactly a person of my political persuasion- who was a supporter of the British Liberal Party when he was alive. He had this to say on matters of this sort:
It is not true that individuals possess a prescriptive ‘ natural liberty’ in their. economic activities. There is no ‘compact’ conferring perpetual rights on those who have or on those who acquire. The world is not so governed from above that private and social interest always coincide. It is not so managed here below that in practice they coincide. It is not a correct deduction from the principles of economics that enlightened self-interest always operates in the public interest. Nor is it true that self-interest generally is enlightened; more often individuals acting separately to promote their own ends are too ignorant or too weak to attain even these. Experience does not show that individuals, when they make up a social unit, are always less clear-sighted than when they act separately.
I have that with me because it is a subject in which I am interested. It seems to me to be the underlying recognition of that principle that is motivating these trends overseas that I personally think are desirable. I shall give honourable members 3 examples of which I have been aware that have occurred recently in Australia. Honourable members will recall the sudden decision of General Motors-Holden’s Pty Ltd to dismiss 5000 or 6000 people before Christmas, in October or November. That has enormous ramifications on the Australian economy not only for the 5000 or 6000 people who are suddenly dumped out the window as industrial fodder to be looked after, with their wives and children, by somebody else, but also for businessmen who deal with the company, the component manufacturing side of the industry, and involves another 20 000 to 30 000 people. The directors of GM-H would probably argue that if is of no concern to anyone but themselves. I would differ. I think it is of enormous concern. It is not good enough any longer for large corporations of that sort suddenly to say, ‘Here we go. Bang’, and make a decision. Some better means has to be worked out.
The cases of Cambridge Credit Ltd and the Mainline Corporation are other examples. One could go on giving a lot of examples. There must be better ways of operating. The thinking behind this provision is, as was said by Keynes- the man who probably did more to preserve and to maintain the free enterprise system in the world than any other single person- it is far too important in this day and age with the complexity of modern economics to leave decisions of that sort simply to an anonymous group of people. I made the point before that stock exchanges have all the powers that this Commission will have but they are not accountable; the Commission is because it serves the public interest. The exchanges tend to serve their own interest. I appreciate that there is a philosophical and ideological approach to the question, but I commend it to honourable members.
I take the point of the honourable member for Moreton about privacy. That is a fundamental principle in our system, something to which we give enormous importance but there is surely a great difference between the privacy of an individual and the privacy of the board room.
Clauses agreed to.
Clauses 268 to 278- by leave- taken together, and agreed to.
Except as provided by this Act and subject to the jurisdiction of the High Court under paragraph 75 (v) of the Constitution, a decision of the Commission shall not be challenged, appealed against, reviewed, quashed, or called in quesuon, or be subject to prohibition, mandamus, ceniorari or injunction, in any court on any account whatever.
– I move:
Omit the clause, substitute the following clause: - 279. Except as provided by the Administrative Appeals Tribunal Act 1 975 and subject to the jurisdiction of the High Court under paragraph 75 (v) of the Constitution, a decision of the Commission in respect of which an application may be made to the Administrative Appeals Tribunal for review shall not be challenged, appealed against, reviewed, quashed, or called in question, or be subject to prohibition, mandamus, certiorari or injunction, in any court on any account whatever. ‘.
The effect of that amendment is to keep the prerogative writs there where no appeal has been made for a question going to the Tribunal. For all other circumstances the prerogative writs now apply. They did not under the original proposal.
Amendment agreed to.
Clause, as amended, agreed to.
Clauses 280 to 282- by leave- taken together, and agreed to.
Subject to this section, the Commission may make rules, not inconsistent with this Act or the regulations, for or in relation to-
– I move:
Omit sub-clause ( 1 ), substitute the following sub-clause:
Subject to this section, the Commission may make rules, not inconsistent with this Act or the regulations, for or in relation to-
a ) any matter in respect of which the Commission is permitted by sub-section 59 (3) to make rules; or
any matter in respect of which the Governor-General may make regulations, and, except where the context otherwise requires, this Act (other than this section and sub-section 284 ( 1 ) ) has effect as if a reference to regulations included a reference to rules of the Commission.’.
The purpose of this amendment is to ensure that apart from express limitations the Commission’s scope for rule making will be, as to subject matter, as broad as the regulation making power of the Governor-General, which is spelled out in the Bill.
-This is the last comment that I shall make on this Bill at the Committee stage. Clauses 283 and 284 contain potentially very significant powers in relation to clause 20 (2). That is what I described this afternood as something almost in the nature of a Henry VIII clause. It will remain to be seen whether these regulating clauses will get the Securities Commission and the country into as much trouble commercially as Henry VIII got himself into conjugally.
Amendment agreed to.
Clause, as amended, agreed to.
Remainder of Bill- by leave- taken as a whole, and agreed to.
Bill reported with amendments; report- by leave- adopted.
Bill (on motion by Mr Enderby)- by leaveread a third time.
– I move:
That the Bill be now read a second time.
Mr Speaker, this Bill provides for powers to deal with intrusions by Indonesian fishermen into waters under Australian jurisdiction adjacent to our north-west coast. It also amends the principal Act with respect to certain formal matters. Since first enacted in 1952, the Fisheries Act has applied to commercial fishing only and, until 1967, solely to Australian residents. It was then amended to include foreign commercial fishing within the 12-mile declared fishing zone. Honourable members will be aware of the presence last year of significant numbers of Indonesian fishermen on our north-west coast. Since these people may not always be fishing commercially, in a sense capable of proof before an Australian court, the Government has decided that the scope of the Act should be extended to enable Australia to control their operations and, should it become necessary, facilitate bringing them before Australian courts.
Following discussions between the Prime Minister (Mr Whitlam) and President Suharto in August last year, Australian and Indonesian officials met in Jajarta in November 1974 to discuss the concern of the 2 Governments about the activities of Indonesian fishermen in Australian waters. An officer of the Western Australian Government was also present at these talks. In summary the understandings reached at the Jakarta talks and proposals for. their implementation mean that Indonesian fishermen will no longer be permitted to fish in waters adjacent to the Australian mainland and immediately adjacent islands, but may do so in waters under Australian jurisdiction adjacent to the offshore islands and reefs of Ashmore, Cartier, Scott and Seringapatam Reefs and Browse Island. As a gesture of friendship Australia will refrain from enforcing its fishery laws against Indonesian fishermen who comply with those limitations. Those who do not may, depending upon the circumstances, be ejected from the area, or referred to the Indonesian authorities, or charged before Australian courts. In addition, the Indonesian fishermen may shelter within the offshore island and reef complexes which I have named but may not go ashore, other than to obtain fresh water on the middle and east islets of Ashmore Reef. Further, they may not take turtles in any waters under Australian fishery jurisdiction nor may they take the controlled resources of the continental shelf except adjacent to the five named reefs and islands.
The Indonesian Government acknowledges Australia’s authority to proceed against Indonesian fishermen who act contrary to the foregoing arrangements and has undertaken to use its best endeavours to notify its fishermen of those arrangements. The 2 Governments will as necessary exchange information about
Indonesian fishing in the waters concerned. The moratorium on enforcing Australian laws against Indonesian fishermen operating contrary to the arrangements ends on 1 March 1975. To plan Australia’s response to intrusions occurring after that date, the Government established an interdepartmental working party including a representative of the Western Australia Government. That is the background to the present Bill and I turn now to its various provisions.
The machinery to regulate Indonesian fishing depends on clause 3 which adds a definition, private purposes’, in relation to non-commercial fishing. This definition will apply generally and has the effect, subject to subsequent clauses, of extending the scope of the Act to permit regulation of all foreign fishing in the declared fishing zone, regardless of its purpose or of the nationality of the foreign boat concerned. Clause 4 extends the existing powers of officers authorising them to board and search fishing vessels, to cover all foreign fishing vessels in the declared fishing zone. As well, the existing power of officers to seize fish taken contrary to the Act or vessels and fishing gear used contrary to the Act, anywhere in waters proclaimed under the Act, has been redrafted for the sake of clarity.
Clause 5 establishes the offence of fishing for non-commercial purposes in the declared fishing zone with the use of a foreign vessel. As well, in conjunction with clause 6, it revises the existing offence of being in possession or charge of a foreign fishing vessel in that zone, to apply it to all foreign vessels equipped for fishing, regardless of the fishing purpose. There are 4 defences to this latter offence, set out in the proposed sub-sections 13ab(2) and (3). Clause 7 makes it clear the power of courts to order the kinds of forfeiture already provided for in cases of both the existing and the new offences.
When the Senate amened the Fisheries Bill 1973 the consequential redrafting overlooked three minor deletions. These are dealt with in clauses 8, 9(a) and 11. Clause 9(b) provides, with respect to non-commercial foreign fishing in the declared fishing zone, similar evidentiary provisions to those already in the Act applying to commercial fishing throughout proclaimed waters. Clause 10 repeals the authority for Australia to pay to the administrations of certain external territories, fees received by those administrations for the issue of licences. Papua New Guinea now enjoys full fishery powers and does not issue Australian licences. Norfolk Island has always enjoyed the privilege of free commercial fishing. Finally, by clause 12, a number of machinery amendments are made to update the
Act in respect of changes in portfolio responsibilities and the name of the Department.
Mr Speaker, the main purpose of this Bill is to give effect to an international understanding which has important implications not only for fisheries but for quarantine, illegal entry to Australia, prevention of wilful damage to Australian automatic weather stations and perhaps Customs matters. I commend it to the House and urge its speedy passage so that it can receive assent and come into operation before 1 March 1975.
-The Opposition fully supports this Bill and will cooperate with the Government in giving it a speedy passage. The purpose of the Bill is to strenghten the provisions of the Fisheries Act particularly in relation to control over foreign commercial fishing within the 12-mile declared fishing zone. The action being taken tonight by this Bill will enable this control to come into operation at once. Much work has been done by the staff of the fisheries section of the Department of Agriculture. I especially mention this because that staff has a high level of professionalism which, I believe, is commendable and deserves some mention in this House. This Bill follows discussions which were begun prior to the present Government coming to power and which were continued by the Prime Minister (Mr Whitlam) in talks with President Suharto of Indonesia last year. It will control the activities of Indonesian fishermen in Australian waters who, from this Saturday as a result of the action taken by the House tonight, will not be able to fish in waters adjacent to the Australian mainland, but will be able to fish in waters off certain specified offshore islands and reefs.
The provisions of this Bill must not be construed as anti-Indonesian. They are designed to protect the fisheries resources of Australian waters but, more importantly, to prevent the accidental introduction of communicable diseases to the Australian mainland. These diseases are of great and grave importance. The Australian Country Party has been concerned about this matter for a long time, and I know that members of the Opposition generally have taken a very great interest in this aspect. The diseases include cholera, and the bovine diseases such as foot and mouth and blue tongue. Honourable members will all be aware that if, say, a disease such as foot and mouth was accidentally introduced into Australia and was picked up by the native fauna of the areas involved, it would not be long before that disease was communicated throughout Australia, with devastating effects on our major industry- the rural economy. Of course, that would be a serious matter for the nation as a whole. At the moment, foot and mouth disease is present in Bali and it would be very easy to accidentally introduce that disease to the north-west coast of Australia through, to quote a Whitlamism, the ‘indeliberate peripatetic activities of Indonesian fishermen’. The provisions of this Bill make it possible for Australia to regulate foreign fishing and declared fishing zones regardless of their purpose or the nationality of the fishing boats concerned. This legislation, through its operation, will do much to prevent illegal fishing operations and directly strengthen Australia’s borders from the accidental introduction of communicable diseases.
In other aspects this Bill amends the original Act following recent administrative changes in relation to the Department of Agriculture. I believe that it is in this respect that these clauses deserve some mention. I have already referred to the Fisheries Division of the Department of Agriculture. The Australian fishing industry currently is facing great difficulties which stem mainly from rising production costs and rising marketing costs. Although statistical information on the fishing industry is difficult to obtain, the figures I have recently seen indicate that the fishing industry is facing an inflation explosion which is discouraging further investment in the industry. From what I can gather, the inflation rate in costs- referring to that part of the operation from setting out to sea and returning- is rising at an annual rate of about 40 per cent.’ I think this indicates the particular problems of this industry compared with many other industries.
At the processing level, the inflation rate is taking a huge bite of possibly 50 per cent. These inflation rate levels, coupled with a relatively low return for Australian fisheries products, domestically and internationally, have meant that the industry in Australia is failing to benefit satisfactorily in terms of the investment involved. The estimated investment level in the Australian fishing industry is approximately $150m. By far the greatest percentage of the industry is in the hands of small owner-operator participants. Because of the nature of the gear involved, as well as the processing requirements, it is an industry which must continually seek to expand its market opportunities, particularly within an environment of raging inflation of the sort to which I have already referred. Very little assistance is available from the Government for the industry to expand its market opportunities. I believe that more should be done in this regard. I think that it needs to be recognised by all of us that the fishing industry is a big industry, and an industry capable of contributing much more to the nation’s wealth. At the same time, there is a need to encourage the consumption of Australian fisheries produce within Australia.
It never ceases to amaze me that when one walks into a local supermarket, the shelves are stocked with fisheries products from overseas. The fish fingers are not Australian;- they come from somewhere else. This is one of the matters that has to be looked at very seriously if we are to do what any honest Australian would want to see done for an Australian industry. When one looks at the monthly import-export figures, one is constantly despondent because of the fact that in terms of total value, we have been importing more fisheries products than we have been exporting. I find this quite ludicrous when it is realised that of all countries, Australia most probably has one of the greatest fisheries resource potentials. I urge the Government to take more action in developing those resources.
In my earlier comments, I made the point that the Government was very well served by the Fisheries Division of the Department of Agriculture. I think that Division needs to be given greater encouragement along the lines that I have suggested in order to ensure that the fisheries industry can grow and expand profitably. It would be a profitable expansion in terms of national need at this time, and certainly in the national interest. I recall the Minister for Northern Development (Dr Patterson) speaking on other occasions on matters concerning developments on the northern coastline of Australia which were directly related to fishery matters. Whilst undoubtedly some progress has been made in the matter of faculties, there was a great set back due to the floods of 1974, and another great set back in recent months due to the tragic effects of the cyclone which struck Darwin on Christmas Day. Undoubtedly these matters are transient and can be overcome. The general pattern of development of the fishing industry, which concerns not just those who operate off the northern shores but also all fishermen around Australia, is a very vital’ consideration. Whilst this measure is designed specifically to deal with matters to the north of Australia, it directly concerns the whole of the fishing industry. On behalf of the Opposition I urge that greater emphasis be placed on the needs of this industry and that this legislation perhaps be followed by other positive action by the Government.
Question resolved in the affirmative.
Bill read a second time.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Dr Patterson) read a third time.
Motion (by Dr Patterson) proposed:
That the House do now adjourn.
– I must say at the outset in raising this matter tonight that I have not had time to contact the Treasurer (Dr J. F. Cairns), to inform him that I would be speaking on it because it has just been brought to my notice that the opportunity to speak is available to me. I wish to raise a subject which concerns very greatly a large number of people within my electorate of Warringah and, I am sure, within the electorates of a great many other honourable members. I refer to the taxation deductions allowable for the payment of rates. As we all know, the Labor Government has set a maximum amount of $300 as the allowable taxation deduction for land and water rates that a ratepayer may claim against his total income tax. This is affecting a great number of people in many electorates, and most particularly is it affecting a great number of people within my own electorate. Therefore, I think that the matter is of extreme importance and I wish to bring it to the attention of the House tonight. The various councils operating within Australia have, I am sure, brought this matter to the notice of successive Treasurers. I know that my own councilsthe Manly Council, the Mosman Council and the Warringah Shire Council- have all made representations directly to the Government and to the Treasurer, and have also made representations through me. On their behalf I have brought this matter to the attention of successive Treasurers, all to no avail. I have here a copy of a letter dated 14 August 1 974 sent to the previous Treasurer, now the Minister for Overseas Trade (Mr Crean), from the Manly Municipal Council. I think it sums up pretty well the feeling of the ratepayers in the electorate of Warringah. It says:
The Council has been concerned with the maximum amount of $300 for land and water rates that a ratepayer may claim as a taxation deduction.
That limit was brought in by the Australian Labor Party Government in the 1973-74 Budget. The Council has lodged a protest with the Federal Treasurer and, as I have stated, representations have been made through me. The letter goes on to say:
Apan from acknowledgments of the Council’s protest no further replies have been received.
Here we come to the crux of the problem. The Council goes on to state:
In view of the inflation that has occurred over the past year -
Remember that this letter was written in August last year and remember that the inflation rate has accelerated even further because of the insubstantial and unrealistic policies of the present Government - and the resultant increasing costs to Councils in providing services, this Council is even more concerned at the iniquitous situation caused by the maximum allowable tax deduction of $300. The overall average rate payable per assessment in the Municipality of Manly for 1974 (including strata titled flats) and including garbage charges is $165.15, while the rate paid by a typical ratepayer on the most frequently occurring valuation is $154.13. These figures do not include water, sewerage and drainage rates paid to the Metropolitan Water, Sewerage and Drainage Board and when their rates are added to the Council rate it takes the total over the maximum allowable as a tax deduction.
Remember that this is the average rate paid by the typical ratepayer in this electorate. This means that a great number of people would be paying well in excess of that. The letter continues:
The Council considers that this situation is extremely bad as it represents discrimination against one section of the community, namely the person who owns or is purchasing a property in which he lives. The limitation imposed will not affect the property owner who derives his income from several properties as it has always been a legitimate deduction in such cases to deduct all outgoings on the income producing property. The present limitation reacts harshly on the young ratepayer who in all probability is struggling to secure a home for himself and his family.
That is the view of the Manly Municipal Council. It parallels the view of the Mosman Municipal Council, it parallels the view of the Warringah Shire Council and I am sure it parallels the view of a great number of other councils throughout Australia.
Let us look at the people it affects. As the Manly Municipal Council pointed out, it certainly affects the young ratepayer who is attempting to buy his or her home. It also affects- to my mind this is a more iniquitous result of the allowable deduction- those people whom this Labor Government pretends to represent- those people on fixed incomes, those people who are least able to cope with the inflationary pressures let loose in the Australian society by the policies of the present Labor Government. A great number of people on fixed incomes live within the electorate of Warringah. It is a very pleasant electorate. It takes in Mosman, Manly and other areas. As people who have visited this area know, it is a very well established and very old area.There are a great number of people within it -
– Did the honourable member say ‘affluent’?
– By comparison with most other areas.
– If he cares to have a look at the people who live within the electorate of Warringah he will find a great number of people who live on pensions and superannuation payments.
– I have 25 000 of them in my electorate.
– The honourable member should be complaining. He should be doing something to protect them and to look after them rather than interjecting here. These people are grossly affected by the higher charges imposed upon them by individual councils. Because they have no opportunity to offset the effects of inflation on their incomes they are forced into a very difficult situation. It can be said that these people, particularly the older ones, can sell their properties, which are valuable properties, and move elsewhere. But why should they? These people have lived in this area and have brought up their children there and all their friends live in this area. Why should they be forced out of their houses by the policies of the Government which alleges that it protects the interests of the smaller people in the community? That is absolute nonsense.
This situation has been brought about by 2 particular policies of the present Government. It has been brought about by the ceiling of $300 on the amount of deduction allowable and it has been exacerbated by the economic policies of the present Government which have led to an unprecedented increase in the inflation rate, with a consequent effect upon the costs incurred by various councils throughout Australia. We are not talking about rich land owners. We are talking about the people who are battling to make a living, the people who are battling to pay off their own homes, the people who are battling to stay alive when their incomes have been reduced because of the extreme inflationary situation brought about by this Government. These are the people about whom I am concerned. The Government should be concerned about them. If the Government has any concept of what it means to these people to live in a society or district where they have spent all their lives, where they have brought up their children, where they have their friends and where they are faced with these ever-increasing and crippling costs, I appeal to the Government, to the Treasurer and to a man who professes to have some humanity, the Minister for Urban and Regional Development (Mr Uren), who is at the table, to look again and to reconsider the decision to limit the total amount deductible for rates to $300. It is unrealistic in the present inflationary times. It is having an extremely deleterious effect upon the lives and the social and economic well-being of a great number of Australians. Tonight I am speaking particularly about the electors of Warringah, but the situation applies far more widely than just in Warringah. If this Government professes to look after these people who are not able to look after themselves, it should quickly reconsider this decision to limit the deduction to $300 with a view to making it far more realistic.
-An article appeared this afternoon in the ‘Sun’ newspaper- I know that this matter was raised briefly in the House by the Minister for Services and Property (Mr Daly)- which was headed MPs Wives-$7,500 Jobs’.
– Do we have to listen to this again?
– I hear the honourable member for Wimmera interjecting. I was not present when this was raised this afternoon. I would have thought that he and everybody else in this Parliament would be supporting what I am going to say. This is not an attack upon the Australian Labor Party Government, upon the Labor Party or upon Labor members of Parliament; this is an attack on every member of Parliament. I intend to be very brief. If we do not start to take action against these sorts of lying, vicious articles- this smearing of all members of Parliament- we will all go down together and Parliament as an institution will be denigrated. I have seen some vicious articles by Mr O’Reilly, who is a beat-up artist extraordinaire, but this one is the greatest mish-mash of garbage I have ever seen in my life. I know that the Minister for Services and Property quoted from the article. Let me quote some of it. It says:
Some Federal MPs plan to employ their wives as their new research assistants at $7,500 a year. They say this will be one way of getting a pay rise.
It goes on later to say:
Several MPs -
Not mentioning anyone by name - claimed today the new staff arrangements were an attempt by the Government to stop pressure for a further pay rise this year.
The article continues:
A group of members said today there was no embargo on who they could employ as their extra staff. One said he would be able to employ his wife to perform electoral work.
I shall refer to my own example, but I know that I speak for many members of Parliament, some of whom are sitting in the House and who have very large electorates. I refer to the honourable member for Chifley (Mr Armitage), the honourable member for Bowman (Mr Keogh) and the honourable member for Parramatta (Mr Ruddock) from the Liberal Party. We all have electorates with over 80 000 voters.
-What about me? I have half of Tasmania.
– We will not go into that in any great detail. Our electorates have in excess of 80 000 electors. I have the largest pensioner electorate in Australia, the largest repatriation electorate in Australia and the highest proportion of aged population of any electorate in Australia. Other honourable members could get up and argue equally strong cases in relation to the sort of problems that they face. My present secretary, Mrs De Vaurno, is the most competent secretary I have ever seen. She works non-stop all day and often works late into the night. She has often to take work home. Very often she goes to my place on the weekend to do secretarial work. When I rang her yesterday and told her that she was going to have a secretarial assistant she almost broke down and wept because the work load has been so heavy. So much so that she has considered giving up her job because she could not keep up with the work. Her worth to the pensioners, the business community and to service organisations has been immeasurable. I am sure that most members of Parliament could say the same about their man Fridays in their own electorates.
Members of Parliament have not been given an increase in staff since 1944. An average electorate has risen from about 45 000 electors to 85 000 electors, and most of them have over 70 000 electors now. The situation is absurd. No businessman in Australia today would even try to cope with that number of constituents with the staff that we have. It is an absolute joke, and it is about time that people like O’Reilly were hauled over the coals for the garbage that they print in their newspapers.
I am sure that most members of Parliament did what I did when I learned of the news, and I want to put it on the record. I rang the Commonwealth Employment Service and requested a competent shorthand typist with previous secretarial experience, preferably between 20 and 40 years of age but not necessarily so. I said to the bloke: ‘Find someone who needs a job. If you can give it to a woman who is a deserted wife, a widow or whose husband is unemployed, it will be all the better.’ They were the conditions I stated. Believe me, I cannot get that person into my office quickly enough. We have had to ring the Minister for Services and Property (Mr Daly) every month or two requesting secretarial assistance for a week in order to catch up on the backlog of work.
I feel that I am speaking tonight not for Barry Cohen, M.P. for Robertson, but for every single one of us. I think it is about time that we stopped taking this rubbish from the O’Reillys in the Press Gallery. I am told that members of Parliament should not attack the Press because if they do they get it back twice as bad. That is too damn bad. If we do not attack the Press, it smears us anyway. If we do attack it, it is even worse. The sort of thing to which I refer has gone on, I believe, in other newspapers right around Australia. I understand that this is a matter of privilege and I think that we ought to regard it as a matter of privilege in order to ensure that these people at least tell the truth. If what was published was said about me as an individual I could sue for $100,000, but because it is said about every single one of us nothing can be done about it. There ought to be a code of ethics in the Press gallery. Members of the Press gallery ought to be forced by their own people to tell the truth so that we do not have to put up with this intolerable garbage day after day.
– I would like to thank the honourable member for Robertson (Mr Cohen) for his spirited defence of me and other honourable members. I do not in any way disagree with his remarks. I was not aware of this particular effort on the part of the Government at least partly to solve the unemployment problems in the district. However, I shall take very careful note of the qualifications which the honourable member specified in looking for somebody to assist me in my work which is just as voluminous, just as difficult and just as demanding as that which I acknowledge most honourable members experience.
– Not as well represented, though.
– I am not going to comment on the quality of his representation. I might be encouraged to say things that I might live to regret. Tonight I want to take this opportunity to deal with the remarks made by the honourable member for Chifley (Mr Armitage) one night last week when he suggested that I ought to make an obeisance not only to the Chair but also to the Government. He was indicating that the present Government has done a great deal in the western suburbs of Sydney for which I ought to be personally grateful. His remarks arose out of a question that I directed last week to the Minister for Urban and Regional Development (Mr Uren). Honourable members will recall the statement of the Prime Minister (Mr Whitlam) in which he indicated that the Government had a commitment to curtail the growth in government expenditure, and I questioned the Minister in relation to that matter. I asked whether the Minister was finally adopting another positive proposal of the Opposition. My question continued:
To what extent does that commitment mean that each of the programs for area improvement schemes, sewerage, umbrella legislation, Darwin reconstruction expenditure, growth centres and land commissions will be limited or curtailed?
I was grateful to hear the Minister make it clear that in the area of urban and regional development which is one of the largest expenditure areas, there was no intention on his part to allow the Prime Minister to prune the expenditure of his Department. I must admit that in my particular area I would not like to see a curtailment of the limited amount of money that has already been spent. I must admit also that I was interested to know whether the limited programs were to be curtailed. But I wanted to make it clear that it was not me or the Opposition but in fact the Government that wanted to have its cake and eat it too. Quite clearly- I might well do this- if I asked every Minister who is in charge of expenditure programs whether program cuts would occur in his area of responsibility I am sure I would get the same reply as that spirited defence that came from the Minister for Urban and Regional Development, because obviously the Government does not have any intention of curbing expenditure. One has only to look for an example at the expenditure on employment schemes, which are another attempt to overcome the problems that were created by the Government’s expenditure. Vast increases in expenditure in various areas have in part brought about the situation that we are now experiencing.
I want to go through in particular the remarks made by the honourable member for Chifley because he referred in particular to the electorate of Parramatta and the so-called benefits that were given to that electorate. In fact, there were a number of inaccuracies in his remarks. He suggested that the Grants Commission had given the sum of $315,000 to the electorate of Parramatta. He said:
The municipal councils in the electorate of Parramatta are to receive a minimum of $3 15,000.
That amount in fact was given to the city of Parramatta, and I need not point out that the city of Parramatta is also substantially in the electorate of the Minister for Urban and Regional Development. Not only the electorate of Parramatta is served by the city of Parramatta; a substantial part of the city of Parramatta is within the electorate of Mitchell. While the Minister is prompting the honourable member for Chifley at this stage that there are other municipalities within the boundaries of the city of Parramatta, I would hasten to point out that the Minister was not aware of that fact until I wrote to him on 16 September and pointed out that a number of other councils came within that division. If one were to look at the boundaries of, say, Baulkham Hills, the small area of Holroyd, perhaps the very small area of Ryde, or the single sub-division of Epping that happens to be in the Shire of Hornsby, one would realise that those areas would add very little to the amounts which are being mentioned.
One has to look at these amounts in perspective. The city of Parramatta has suffered rate rises of some 35 per cent. Why is it that in this time when the Grants Commission is making available these amounts of money we have a rise in rates of some 35 per cent and a number of other municipalities in the city of Sydney have larger rises? The reason for that is the failure of the Government to be able adequately to manage the economy of this country. All of those councils have seen vast increases occur in their expenditures through the excessive wage demands generated as a result of the Government’s economic policy. One has to look at these things in the totality of the situation and the totality of the situation is that, notwithstanding the grants that are being made now, these councils cannot continue to employ the personnel that they have, cannot continue to operate at the same rate as they did formerly and cannot continue to provide the same services as they were able to provide formerly.
Reference was made by the honourable member for Chifley in his speech on the Western Suburbs area improvement scheme and he mentioned the princely sum of $690,000 that was made available to the electorate of Parramatta for area improvement projects. I took the time to go through the amounts allocated in the advances last year to the City of Parramatta and to each of the other municipalities within my electorate. The total sum that I could find spent was $390,000. If honourable members want me to go through those grants I can. There was a grant of $60,000 to the City of Parramatta planning scheme; there was a grant of $20,000 for the Parramatta seawall; and there was a grant of some $300,000 for the acquisition of land.
– Who gave that?
-The Labor Government. The very point I am making is that the honourable member for Chifley has come into this House and said that the sum given was $690,000 whereas in actual fact the sum given was $390,000.
– He was about half right.
-Yes, he was about half right. That is what one expects from the honourable member when he makes remarks of this type. The amounts that he said were given as gifts were in fact given illusorily, as I have quite clearly pointed out. I want to take the honourable member for Chifley on to the grants made under the Western Suburbs area improvement scheme this year. Not only were the amounts available to the Western Suburbs halved from the $4.5m given last year to an amount of $2m this year but also the City of Parramatta only received these sums: Twenty thousand dollars to develop parkland in association with Colquhoun Park between Lavinia and Adam Streets in Granville, which happens to be in the electorate of Reid; $20,000 for a tree planting program with priority to be given to the Granville area- I have assumed that some of that might have been in relation to the electorate of Parramatta; and $10,000 for preliminary clearing of the development on the Duck Creek River parklands in close association with the Auburn Council. A sum of $50,000 was also given to the electorate of Mitchell and of $30,000 to the electorate of Parramatta. A total of $50,000 was the princely sum given.
If I went through the list and compared the amounts given to the electorate of Parramatta with the amounts given to the electorate of Reid, the electorate of Chifley and the electorate of Prospect under the area improvement scheme I would find a bias of considerable magnitude. There are areas of the electorate of Parramatta, such as Dundas Valley, Ermington and Rydalmere, which are as deprived as any other area of Sydney. I am personally ashamed about the directions coming from the Department of Urban and Regional Development that Granville ought always to receive priority when grants are made to the City of Parramatta. Rather than do obeisance, I propose to take up this matter as regularly as I can and to point out how clearly this program is being used, I submit, as pork-barrelling in areas of the Western Suburbs to the advantage of the electorates of the honourable members I have mentioned and not those of -
-Order! The honourable member’s time has expired.
– I think that we have heard from the honourable member for Parramatta (Mr Ruddock) almost one of the greatest advocacies of the policies of the present Government that I have ever heard in my life. All he has done is quote the amount of finance that the present Government has been pouring into the outer Western Suburbs of Sydney. It has been pouring in finance, whereas in 23 years in office the previous Liberal-Country Party government did not put in one single penny or one single cent. The honourable member for Parramatta has, of course, complained about the area improvement plan. That is to be expected. He always wants more. The Government of which he was a supporter never gave one penny for such a program, but now he says: ‘You have given some finance but I want more’. We expect that of him. He has forgotten that the area improvement plan of which he has complained is the result of joint discussions between the Australian Government and the Liberal-Country Party Government of New South Wales of which his father is now a Minister. So he had better go home to Daddy and say: ‘Please, Dad, try and get me a little more’. Honestly, Mr Speaker, can you blame me for laughing a little bit? The honourable member for Parramatta then went on to say that the various councils around the area had increased their rates.
– Not Fairfield.
– What he has forgotten, as the honourable member for Prospect has said, is that when it was controlled by the Australian Labor Party the Fairfield Council did not but that the Parramatta Council, a so-called independent council which has a strong Liberal influence and which is, of course, part of the Liberal Party machine of the honourable member, and the Blacktown Council, a so-called independent council which also has a strong Liberal Party influence- none of them Labor Party con-, trolled councils- as well as the Penrith Council, a so-called independent council which has a strong Liberal Party influence have appreciably increased their rates despite the fact that they have received record amounts in finance from this Government. For the first time in history they have received very appreciable amounts in finance from the Australian Government under the area improvement program and the Regional Employment Development Scheme. They have also received finance from the Department of Tourism and Recreation and, of course, the Grants Commission. All of it is nonrepayable, non-interest bearing grants. I agree with the honourable member for Parramatta that it is hard to understand why they have had to increase their rates by such an appreciable amount. Without a doubt they are going to be in a sea of liquidity with the finances that we have put into the area.
The honourable member for Parramatta also did not mention that during 23 years LiberalCountry Party Government- a government of the honourable member’s political complexionthe debts of local government increased by 2800 per cent whereas the debts of the Australian Government during the 23 years in office of the Liberal-Country Party Government of which he, his father and so on have been such a part remained approximately static. The LiberalCountry Party Government did not do a single thing for local government right throughout that period, yet we have been able to turn around and inject so much finance into the area that it is going to bring about a very great benefit indeed. I stated very clearly last week- I make no excuse for doing so- that the honourable member for Parramatta, instead of always trying to bring carping, petty political propaganda into this House, should be down on his bended knees thanking the present Government for what it is doing in his area. Even though it is a Liberal Party area we are not prejudiced. We believe that funds should be allocated on the basis of need. That is why we have been injecting funds into the outer Western Suburbs of Sydney, which were neglected for so many years by the previous Liberal-Country Party Government. We have been injecting that finance on the basis of need. Those areas of the Western Suburbs which have the greatest need, such as Mount Druitt, will naturally attract the greatest amount of assistance. The Minister for Urban and Regional Development (Mr Uren) has, by way of interjection, made a very important point. He has pointed out that because honourable members like he and I live in the area we therefore understand the problems of the area and the needs of the area. That is a very important point. I think that the honourable member for Parramatta might have moved into his electorate since his election to office, although I am not sure. Certainly if he has done so he has done so only in comparatively recent times. So for that reason he would not have the same appreciation as honourable members on this side of the House of the great needs of the outer Western Suburbs of Sydney.
– The honourable member must be pleased to know that I have worked against him for years and years.
-Order! The honourable member for Parramatta was heard in comparative silence.
– The honourable member for Parramatta stated that the Grants Commission’s allocation to the City of Parramatta amounted to $3 1 5,000 and then said that most of the area of the City of Parramatta is in the electorate of Reid. I think I heard him correctly. I suggest that he should get to understand the geography of his own electorate.
– I said a substantial part.
– A substantial part. That is another qualification. A substantial part surely means the lot. Only one ward is in the electorate of Reid.
-Order! It being 1 1 p.m., the House stands adjourned until 10 a.m. tomorrow.
House adjourned at 11 p.m.
The following answers to questions upon notice were circulated:
asked the Treasurer, upon notice:
– The answer to the right honourable member’s question is as follows:
I refer the right honourable member to the Prime Minister’s answer to question No. 964 on the 1973 Notice Paper (Hansard, 27 September 1973, pages 1714-5) in which he drew attention to the impracticalities of attempting to list all the consultations in which departments are engaged with other departments. My Department keeps me properly informed of all important developments- this is a satisfactory procedure for the purposes of my ministry.
asked the Minister representing the Minister for Aboriginal Affairs, upon notice:
– The Minister for Aboriginal Affairs has provided the following answer to the honourable member’s question:
Gnowangerup-12, 29, 30 July; 20 August; 11, 25 September.
Katanning-10, 11 July; 12, 16, 20, 27, 30 August; 1 1, 26 September.
Narrogin- Regional office located there.
Pingelly-4, 7, 16, 18, 19 July; 17 August; 1, 30 September.
The visits were carried out by officers of the Western Australian Branch of the Department of Aboriginal Affairs.
These visits resulted in 18 Special Work Projects being initiated with the various Shires. A further 7 are pending. Supportive action was taken with Aboriginal groups at each centre.
A major social survey was undertaken in the south west of the southern region to project plans for future development of Aboriginal communities.
Pinjarra-5, 8, 10, 23 July; 8, 22 August; 6 September.
This centre was visited by officers of the Western Australian Branch of the Department of Aboriginal Affairs for the following purposes:
To initiate application for Special Works Project by the Shire.
Discussions leading to the employment of 6 Aborigines with the local Alcoa plant.
To attend Annual General Meeting of Murray Districts Aboriginal Association.
Co-ordination of activities for the development of the Association Community Centre.
Discussions with Shire on unemployment and drinking problem in the town.
asked the Minister for Education, upon notice:
What capital expenditure was incurred, and what were the running costs of each tertiary institution in Australia in 1 973-74.
– The answer to the honourable member’s question is set out in the attached tables.
New South Wales Victoria . . . Queensland South Australia Western Australia Tasmania . .
7,610,950 13,564,216 5,078,211 6,195,491 7,221,830 292,013
28,934,795 46,711,181 14,437,714 13,517,917 17,247,069 3,959,512
Australian National University* . . , Canberra College of Advanced Education
In addition the Australian National University received a statutory grant of $650,000.
asked the Minister for Defence, upon notice:
-The answer to the right honourable member’s question is as follows:
asked the Minister representing the Minister for Aboriginal Affairs, upon notice:
With reference to the answer to my quesuon No. 495 (Hansard, 26 September 1974, page 1927), what grants are proposed for the New South Wales Aboriginal Legal Aid
Service for 1974-75, and on what conditions will the grants be made.
– The Minister for Aboriginal Affairs has provided the following answer to the honourable member’s question:
The budget submitted by the Aboriginal Legal Aid Service (N.S.W.) for 1974-75 is currently under consideration by my Department.
The Service is presently being funded on an interim basis on the condition that no expansion of activities take place and that expenditure of grant moneys only be made with the prior authorisation of the Service’s auditor. A grant of $9,500 has been made to allow the Service to employ additional accounting staff.
When the 1974-75. budget is approved the grants will be subject to the normal conditions applied to the funding of other similar organisations. These conditions are that quarterly returns and half yearly audited financial statements be furnished; that the ‘Financial Rules’ for the guidance of Aboriginal Organisations be complied with; and that payments after December 1974 only be made on evidence of action to commence incorporation.
asked the Treasurer, upon notice:
– The answer to the right honourable member’s question is as follows:
In answer to the right honourable member’s question, I refer him to the information provided by the Minister for the Media in reply to Question No. 1581 (House of Representatives Hansard, 4 December 1974, page 4590).
asked the Minister for Transport, upon notice:
What assistance does the Government provide to the Australian Volunteer Coast Guard Organisation.
– The answer to the right honourable member’s question is as follows:
Australian volunteer coast guard organisations receive grants from the States in some cases, and are assisted by public subscription in others. The Australian Government does not provide financial assistance to these organisations.
asked the Minister for Education, upon notice:
– In answer to the honourable member’s question the following table shows the salary of (a) first year and (b) fifth year graduate school teachers in Western Australia, New South Wales and Victoria as at 30 June in each of the last five years. The table also shows the corresponding annual increases in salary expressed as a percentage of the salary level at the previous June.
WA N.S.W. Vic
Salary Increase Salary Increase Salary Increase Year 30 June Per cent 30 June Per cent 30 June Percent
First year graduate teachers
W.A. N.S.W. Vic
Salary Increase Salary Increase Salary Increase Year 30 June Per cent 30 June Per cent 30 June Percent
1973 7,178 16.8 7,178 14.5 7,168 3.9
1974 8,629 20.2 8,629 20.2 8,494 18.5
In general primary and secondary teachers with equivalent qualifications and length of service receive the same salary.
The Table below sets out movements in the consumer price index and in average weekly earnings for the same period.
Average weekly Consumer price earnings (A) index (B)
asked the Minister for Health, upon notice:
– The answer to the honourable member’s question is as follows:
Drugs presented for evaluation
Of the 180 applications received in 1973-74 for general marketing, sixty-two were presented to the Australian Drug Evaluation Committee for consideration; of these forty-one were approved, twenty-one on first presentation and twenty after further information had been obtained from the sponsor.
Recently a need was seen to revise the procedural structure for dealing with applications. Resulting, from that revision it will be possible to reduce the time taken to process applications although this reduction will not become apparent in the immediate future. The revision includes the recruitment of pharmacologists, medical officers and advisers in clinical pharmacology to fill recently established positions. As an immediate measure to accelerate evaluations of new drugs, experts outside the Public Service are being used on a contractural basis.
The implementation of revised procedures will result in the formal acceptance of applications after a preliminary check has ensured that all necessary data have been provided. Better statistics will also be available.
Some of the new procedures in relation to the processing of clinical trial applications have been explained to the pharmaceutical industry and have been well received.
I expect that, from a few months hence, my Department will be able to provide information of the type now sought.
asked the Prime Minister, upon notice:
How many interdepartmental committees are currently operating.
– The answer to the right honourable member’s question is as follows:
As I informed the right honourable gentleman on IS November 1973 (Hansard pp. 3373-4), I shall not authorise the expenditure of time and money involved in answering questions, such as this, which seek generalised information on interdepartmental committees.
The right honourable member will be aware from my answer on 20 September 1973 (Hansard p. 1317) that if he wishes to know the composition and function of any particular interdepartmental committee and for what period of time it has been active, I shall be happy to provide him with that information.
asked the Minister for the Capital Territory, upon notice:
Why has there been such a delay in the establishment of the A.C.T. Housing Authority.
– The answer to the honourable member’s question is as follows:
The question of the establishment of the A.C.T. Housing Authority has been looked at in the general context of future government arrangements in the A.C.T. An Ordinance in draft form was recently reviewed by the A.C.T. Legislative Assembly and the changes it recommended are now with the draftsmen.
Cite as: Australia, House of Representatives, Debates, 26 February 1975, viewed 22 October 2017, <http://historichansard.net/hofreps/1975/19750226_reps_29_hor93/>.