4th Parliament · 3rd Session
The President took the chair at 3 p.m., and read prayers.
MINISTERS laid upon the table the following papers : -
Conciliation and Arbitration Act 1904-1011- Regulations Amended. - Statutory Rules 1912, No. 163.
Customs Act 1901-igio - Provisional Regulation. - Statutory Rules 1912, No. 152.
Defence Act 1903-1911 - Universal Training - Amendment of Provisional Regulation 153 (b) - Statutory Rules 1912, No. 155.
Electoral Act 1902-1911 and Referendum (Constitution Alteration) Act1906-1910 - Provisional Regulations. - Statutory Rules 1912, No. 161.
Lands Acquisition Act - Land acquired under -
In the Federal Territory and New South Wales - For Commonwealth purposes.
At Guildford, Western Australia- For De- fence purposes.
At Dumbleyung, Western -Australia - For Postal purposes.
Naval Defence Act 1910-1911 - Naval Forces - Regulations, amendments, &c. - Statutory Rules 1912, No. 154.
Papua - Ordinance No. 6 of 1911 - Supplementary Appropriation of 1910-11, No. 6.
Seat of Government - Ordinance No. 3 of 1912 - Traffic (No. a).
– I desire to know, sir, whether you are yet in a position to make an announcementas to the response to the communication which you forwarded some time since to the Governor of South Australia regarding a vacancy in the representation of that State in the Senate.
– Yes. I have received from the Governor of South Australia a certificate that Mr. Shannon had been elected; but, as the procedure was not in conformity with the Constitution - the certificate has to come through the Governor- General -I forwarded it to the Governor- General, asking for his certificatei believing that that will meet the requirements of the Constitution. I have also notified the Governor of South Australia as to where the error was in his communication, and the action which I have taken.
– I have to an nounce that I have received from Senator McDougall a notice that he desires to move the adjournment of the Senate to call attention to an urgent matter of public importance, namely, “ the recent resignations from the Australian Garrison Artillery at Sydney,”
Four honorable senators having risen in their places,
.- I move -
That the Senate, at its rising, adjourn till to-morrow at 10 a.m.
I take this opportunity of replying to the report that we had from the Minister in answer to my question. I intend to make a few charges against, the officer who furnished the Minister with that report, with the desire to throw dust into his eyes as to the real cause of the resignations, and also against the Minister for unwittingly throwing dust into the eyes of members of this Parliament and the people of Australia. The hrst charge I make is that a large amount of matter was suppressed in thereport.
– By whom?
– By whomsoever furnished the report. I am not to blow who did.
– Was it suppressed by the officer reporting to the Minister, or by the Minister reporting to the Senate?
– By whichever the honorable senator likes.
– I shall hold both guilty until you prove one or the other innocent.
– The honorable
Senator can shut his eyes and take his pick. My second charge is that the reports which were furnished to the Minister were deliberately altered; and my third charge is that, an amount of matter was introduced Co divert attention from the real point at issue. In regard to the first charge, a report is given from the officer commanding the Fifth Company of theGarrison Artillery, who is stated therein to be Captain Forsyth. He is the officer commanding the Fourth Company of the Garrison Artillery. If the report quoted is to be attributed to him, then the report of Lieutenant M. Chaseling has been deliberately suppressed. He sent in a report on his company, but it did not appear with the others. It is en tirely different, I am given to understand, from those which were supplied. I do not know whether it was through a mistake, or to excuse themselves, that the wrong officer was put down as commanding that company. In regard to the ‘alterations, it has already been shown that the transposition in order of importance of Major Warren’s reasons for the crisis puts a different complexion on the whole business. It. has been suggested that the abolition of the regimental staff of the Fifth Garrison Artillery was the least important reason tor the resignations. In point of fact, that officer thinks that it comes first. The reasons for the resignations as given by Captain Forsyth are the increased length of continuous training, fines for non-efficiency, the restrictions on smoking, and the reorganization doing away with the regimental staff. It is well, known in New South Wales, and also well known to the Minister and to the officers, that the re-organization should have been put first as the cause of this trouble. In the report it was put last, so that it should appear as a very minor -point in the issue. In regard to my third charge, namely, the introduction of extraneous matter, the Minister’s advisers have tried to minimize the actual, cause of the crisis by reporting that the regulatons were the sole cause of the crisis. That they were wrong is proved by Friday night’s parade, which was looked upon as a criterion of the effect of the Minister’s concessions.
In no company was there a greater attend ance than twelve men out of an establishment o£ 125, which clearly proves that the concession of the Minister, as reported in the papers, had not the desired effect. The report of Gunner McClean is put forward as one of the reasons:’ That is the flimsiest reason put forward and is most farcical, giving one the idea’ that he is leading of Gilbert and Sullivan instead of a regimental staff of the Commonwealth. The report states that no candles- were available, whereas it is well known that the magazine regulations demand that candles of different lengths shall be kept in magazines at all times. The reason for the rule is that the candles cannot all go out at once, and should always be available. The Minister prates of the surprise attacks that these forts are going to get. The surprise is that a’ company turn up to drill and the forts are not prepared for them. How are you going to act if you get a surprise attack from a hostile fleet?
I will not say any more about that part of the subject, because I know Gunner McClean to be a very good officer. I now have to draw attention to what I call a deliberate misrepresentation. Captain Forsyth says that at a regimental dinner of the Australian Garrison Artillery great dissatisfaction was expressed by the men on the subject of the abolition of the regimental staff. Captain Forsyth places that as the first reason, but it was given last amongst the reasons adduced by the Minister. I was present at the regimental dinner in question, and heard all the speeches made there. Speeches were made by Mr. J. C. Watson, Senator Pearce, Minister of Defence, Mr. Riley, M.P., Mr. West, M.P., and myself. Not a word was said there that was calculated to rouse the enthusiasm of this fine regiment - the finest in Australia - by inducing it to go on strike because of the conditions imposed. I say that the officer who gave that as a reason for what has occurred has been wilfully endeavouring to mislead the Minister, and the Minister in his turn has misled the people. The real cause of the trouble is the discharge of the commander of the regiment, a militia officer whom I have known for a great many years, and against whose ability no one can say a word. He was appointed about nine months ago - it may be a little more - to command the regiment for a term of five years. His appointment was very popular with the regiment. He has won such a kindly feeling amongst the whole of the men that they believe that he has been unfairly and unjustly treated by the Defence authorities in being deposed from the position which he had so honorably gained. No adequate reason has been given for his deposition, but it is believed that the Military Board and the military authorities in New South Wales desired to get rid of him. As the Minister is aware, I brought this matter under his notice some time ago. When Parliament was in recess I wrote to the Prime Minister that I was willing to come to Melbourne to lay the facts before him, but I was not afforded that opportunity. The regiment have all along been waiting for some response from the Department, hoping that their commander would be allowed to fulfil the term for which he was appointed. The Minister told us in his reply last week that-
Lord Kitchener recommended that, as the guns were now of such a highly technical character, there should be two reliefs of permanent troops, and that the command of fortresses should, in all cases, be in the hands of permanent officers. That recommendation has been backed up from time to time by other permanent officers. It has been represented that, in case of war, any attack upon our forts would probably be in the nature of a surprise attack, and that, therefore, the officers in command should reside close to them.
If they get a surprise attack, what about the candles? The Minister forgot when he made this statement that the officer appointed as fortress commander must and does reside at Victoria Barracks, and that the officer who has been deposed lives within a few yards of the barracks. So that nothing could be urged against him on that score. If honorable senators look into Lord Kitchener’s recommendations they will see that he says that on account of the highly technical character of modern guns they should be in charge of permanent troops. If the Military Board intend to carry out Lord Kitchener’s recommendations, the first thing they would do would be to put the guns in the hands of permanent troops. That they have not attempted to do. To have even one relief of permanent men in charge of the guns would involve the engagement of eightyfour additional permanent men. To provide a second relief we should require a great many more. The authorities have not attempted to carry out that part of Lord Kitchener’s recommendation. The officer commanding this regiment never was a fortress commander in New South Wales. The fortress commander has, for a number of years at all events, been a permanent officer. There must be some reason, of which we know nothing, when the authorities attempt to remove an officer who has nothing to do with the technical management of the guns. I may say that I am with the Board, and with the Minister, in regard to carrying out this particular recommendation, and as soon as it can be carried out by putting these men - who, generally speaking, are mechanics - into the Permanent Forces, I shall be glad to see it done. But that has nothing to do with the protest made by the Australian Garrison Artillery against the unjust treatment meted out to their commander. I am aware that the Minister knows nothing personally about these men. He is merely the political head of the Defence Department. He admits that he knows nothing. In a case of this description I think it is a pity that in his spare time - and I know that he has some-
– Thank you ; that is more than I know, anyway.
– It is a pity that he does not find out something for himself about this matter. Perhaps 1 can explain it to him, though, perhaps, I have not had as many opportunities of ascertaining the facts as he has. I know that the Minister once paid a visit to the fort during practice, and when the guns went off they frightened the very life out of him.
– The guns frightened the Minister of Defence?
– They would frighten any one.
– If the rest of the honorable senator’s “facts” are as reliable as that, he is very far astray.
– The position of fortress commander need not necessarily be held by an artillery man at all. The fortress commander needs to. know nothing whatever about battery work. The fire commander comes next. He occupies what I think they call “a cell,” that is to say, a little house in which he watches for the coming of the enemy. When he sees the enemy coming, he has machinery at his disposition to find out how far the ship is away, and what kind of a vessel she is. With this information he knows what kind of gun will be needed to reach her. When he has ascertainecl that information, he immediately telephones or communicates in some other way with the battery commander. The battery commander has entire charge of the battery, but he has nothing to do with the technical working of the guns. The -next officer in the series is the gun group commander. This officer has charge of the group that runs a gun. Every man has his position detailed to him when he is taken out of his company and set to work the guns. Every man knows exactly what he has to do. So that the fortress commander, the fire commander, and the battery commander, have nothing to do with the technical parts of the guns. That work is under the direction of the gun group commander. He is the man who is charged with the firing of the gun. . He has the technical work to do, and has the business at his fingers’ ends. I mention this in order to show that by removing the commander of the regiment from the position of fire commander, and still leaving a militiaman in charge, the Minister has not alone a single thing to carry out the recom mendation of Lord Kitchener. When he was prepared to do so it would have been time enough to remove the militia officer from the command of the regiment. I propose to deal now with another matter. 1 do not know whether it involves a charge. At last Friday night’s parade, an officer attended to try and induce the gunners not to leave the regiment. I should like to say first of all that that should never have been done. As a matter of. policy, directly a. soldier sends in his resignation he should be discharged. The Minister stepped down when he tried to induce these men to rejoin the regiment. I know that he did so because he is aware that these men cannot be done without, and that if an attack were made upon Sydney without the assistance of these men we should be in a ridiculous position, because the guns, and forts would be useless for our defence.
– Yet the honorable senator says that I should not have asked the men to withdraw their resignations.
– No; the Minister should not have done so. Upon sending in their resignations, they should have been discharged in accordance with military orders. The officer who represented the Military Board at last Friday night’s parade, and whose duty it was to make representations to the men to induce them not to leave the regiment, said to them,. “ The regulations are very severe in connexion with cigarette smoking; but, of course, we officers will not be hard on you. If we see you smoking, we will look the other way. There is no canteen to be allowed in the militia camp, but we have a canteen always for the permanent men,: and I will see that the right man is put in charge.” Those were nice representations to make on behalf of the Minister and the Military Board to induce these men. to withdraw their resignations.
– Where did the honorable senator pick this up? Is this moregossip ?
– If the Minister had stepped down so far as to say to the men that things would be as they were before the 30th June, and that they would have their commander back in charge of the regiment within a certain time, there is not one man in that regiment who would not have been prepared, in spite of the taunts of disloyalty hurled at them, to have: shed his blood in the defence of his country. The fact is that the men felt and knew that an injustice had been done to their commander, and rather than put up with that they were determined to give up soldiering altogether as a protest against the unfair treatment meted out to this officer.
– They would rather let the country go to the dogs than part with a cigarette.
-The VicePresident of the Executive Council is trying to throw a little more dust, but I do not take any notice of him. He is only saying what the Government have already said. He is suggesting that the action taken by these men was due to the prohibition of cigarettes and drinking, and I am trying to show that it was due to nothing of the sort, but to their resentment, because of the injustice done to their commander, who was one of themselves, and had risen from the ranks to the top of the tree. In my daily avocations I have been associated with these men for many years. I know that they have given up their spare time to military work instead of enjoying themselves, as other men have done, in witnessing the sports on a. Saturday afternoon. I know almost all of the men in the regiment; and I say it is unfair and unjust to say that it is because of the trivial matters to which I have referred that they decided to abandon their regimental duties. I direct attention to a remark of the Minister which, at the time it was made, I characterized as unfair. The honorable senator said -
I understand that some of the dissatisfaction has been caused by officers who are on the regimental staff who object to the change, and who managed to get a certain amount of support from men in their companies.
– Hear, hear !
– I say that that is, unjust and unfair, and it is as false as it is unfair. I heard the commander of the regiment beseeching and imploring the men not to resign on his behalf. He said, “ If I am to go out, I shall go out like a man ; but I do not want you men to send in your resignations.” Mr. Fuller, the hon- orable member for Illawarra, can testify to the correctness of the statement that, when at Wollongong recently, the halfcompany there had what they called a “dying” dinner; because they were all going to resign. Lieutenant Chaseling, who was there, in the presence of Mr. Fuller, said to the men, “ Whatever you do, do not send in your resignations.” He implored them to stick to their duty, and he had such a hold on the men, because he is one of themselves, that they did not send in their resignations.
– They did.
– Then the papers submitted in connexion with the matter must lie. I say they have not sent in their resignations.
– They were going to do so.
– The Minister, of course, knows what they were going to do. He knows a. lot of things.
– The resignations came only from men who had been addressed by the Minister !
– If the Minister knew what the men were going to do, why did he not stand up like a man at the regimental dinner, and say, “ I have done with this thing. Your commander has got to go. I am not prepared to retire from the position I have taken up.” If the honorable senator had said that, the resignations of the men would have been in long ago. He said neither one thing nor the other. He held out no hope. He said, “ When I am sick, I have to go to a doctor. When I want to know something about the military business, I go to a military man. This was the decision of the Military Board.” If the honorable senator had said, “ I shall stand by my guns, and_ your commander must go, every man in the room would have resigned the next day. The Minister should take up a dignified position. He should not descend, as he has done in this case, to little petty reasons for the resignations. He says that he knew what the men were going to do; and I say that the men at Wollongong were going to resign when the commanding officer, Lieutenant Chaseling, implored them to do nothing of the sort. When the Minister says that officers of the regiment induced men to resign, I say that the statement is as cowardly as it is false.
– I rise to a point of order. Is the honorable senator in order in describing a statement which he says I have made as being cowardly and false?
-The honorable senator must withdraw the statement.
– I withdraw it. If the Minister had not interfered, he would not have got it. I say that the statement is at variance with the facts. It is not correct. If he was advised by his officers that it is correct, I am here to say that it is not; and I am prepared to prove that it is not correct. I ask the Minister to have an open inquiry into the matter, and give the men an opportunity to put their case forward, when I am sure they will come out on top. I have copies here of the criticisms of the action of the Department which were published in the New South Wales newspapers. I shall not weary honorable senators by reading them all; but I shall quote this statement, which was made in the public press.
In answer to a question put to him in the Senate on Thursday evening, Senator Pearce made a statement which was intended to set th public mind at rest. It is a statement, however, at which every Artillery officer in the Commonwealth is smiling.
– Order ! I would direct the attention of the honorable senator to standing order 409, which reads -
No senator shall read extracts from newspapers or other documents, except Hansard, referring to debates in the Senate during the same session.
– No debate has taken place upon this matter.
– Order ! An honorable senator has interjected that no debate has taken place. Certainly, questions have been put to the Minister, to which he has replied, and that practically amounts to the same thing.
– Upon a point of order, do you, sir, rule that if an honorable senator submits a question and the Minister replies to it, a debate has taken place in accordance with the terms of the standing order, and that no other honorable senator is at liberty to quote an extract from a newspaper relating to the same subject?
– Honorable senators will see that numerous questions may be put upon the business-paper to which a considerable number of replies may be given. These, I think, form a part of the business of the Senate, and, in my judgment, are tantamount to statements made during the course of debate in regard to the same matter. If honorable senators are permitted to quote newspaper extracts bearing upon replies to questions, they may as well be at liberty to quote press extracts referring to debates which have taken place in the Senate.
– Is your ruling, sir, intended to cover every question which may be asked in the Senate, and every reply which may be given ? Do you regard such questions and replies as constituting the subject-matter of a debate?
– If that be so, all debate may be stopped merely by Ministers answering questions.
– I have no desire to unduly limit debate, but I would point out that any question which is put to a Minister and answered by him may be quoted from Hansard in accordance with the standing order. The only prohibition imposed is in regard to extracts from newspapers or documents other than Hansard referring to debates in the Senate during the same session. If an honorable senator chooses to quote any question or answer from Hansard, he will be perfectly in order, but he will be out of order in quoting the criticism of newspapers in regard to the same subject.
– Do you, sir, rule that a reply given by a Minister to a question is tantamount to a debate?
– I am certainly of opinion that we should be breaking the standing order if honorable senators were permitted to quote the criticisms of newspapers upon questions put to Ministers in the Senate, and upon the replies given to them during the same session.
– Suppose that a question were asked of a Minister upon a matter of public importance, and that the Minister replied to it. Suppose, further, that a debate subsequently took place on a Bill dealing with the same subject, would it be incompetent for any honorable senator to quote the comments of a newspaper upon that debate?
– I think the honorable senator will see that such a debate would be practically a continuation of the same business. A question is asked for the purpose of eliciting information. When a debate takes place on any matter an honorable senator may say anything that he chooses in regard to it. But when he attempts to quote newspaper extracts other than Hansard bearing upon that subject, I think he is out of order.
– I think that the standing order relates only to a debate upon any question.
– It refers to speeches which are made. Standing order 408 reads -
No senator shall allude to any debate in the same session upon a question or Bill not then being under discussion, nor to any speech made in Committee, except by the indulgence of the Senate for personal explanation.
I have already pointed out that questions and answers may be quoted from Hansard.
– I think, sir, that you ruling would curtail the privileges attaching to debate in this Chamber.
– I rise to a point of order. I wish to know whether this desul-. tory discussion is in order in the absence of a motion challenging your ruling?
– A motion of that character should be submitted.
– I move -
That the President’s ruling - that an . honorable senator cannot read an extract from a newspaper commenting on an answer given to a question during the present session - be disagreed with.
I submit this motion with regret, but I am under the impression that the ruling would limit debate if it were handed down. In other words, it might introduce another form of the “gag.” I know that during the five years and a half that I have been here honorable senators have repeatedly quoted extracts from newspapers in connexion with matters such as Senator McDougall was calling attention to. Only a few days ago questions concerning the appointment of Mr. Chinn as supervising engineer of the western portion of the Kalgoorlie to Port Augusta railway were asked involving the matter of daylabour. Last week an honorable senator read an extract from a newspaper, and a very lengthy extract, too, which appears in Hansard, in connexion with the subject of day labour. But be that right or be it wrong, I humbly submit that a question asked by an honorable senator and answered by the Minister is not a debate within the meaning of standing order 409, which you have cited to buttress your ruling, and which reads -
No senator shall read extracts from newspapers or other documents, except Hansard, referring to debates in the Senate during the same session.
Now, does the mere asking of a question here, and the reply of the Minister thereto, constitute a debate?
– I do not take that view.
– What isa debate?
– The interpretation I put on the word “ debate” is that there is an exchange of opinion, a. discussion for or against the question before the Senate. But when an honorable senator puts a question to a Minister he is not allowed, under the Standing Orders, to debate the reply ; nor is he allowed when he is putting the question to debate the subject-matter of it.
He is simply allowed to ask the question, and the Minister is permitted to reply. Then any other honorable senator as well as the senator putting the question can ask a question arising out of the reply. If the Minister is not prepared to reply to the further question, he can ask the senator by whom it is asked to give notice, and there the matter ends. I do not think that any honorable senator can construe such a proceeding as a debate, because there is no exchange or interchange of opinions on the matter immediately before the Senate. I think, sir, that unless your ruling be dissented from it will practically limit debate, and also prevent an honorable senator from getting information for the public.
Motion (by Senator McGregor) agreed to-
That the question requires immediate determination.
– I understand, sir, that some time ago a question was put to the Minister of Defence regarding the Australian Garrison Artillery, and that a reply was given, and that based on that fact you have ruled that the reading of a newspaper extract dealing with the subject-matter of the question is out of order. May I first callour attention to standing, order 408, which really governs standing order 409? It reads -
No senator shall allude to any debate of the same session upon a question or Bill not being then under discussion.
I will not read the rest of the rule. Standing order 409 reads -
No senator shall read extracts from newspapers or other documents, except Hansard, referring to debates in the Senate during the same session.
It is a fact that there has Been no debate on this matter during the present session. I think it is just possible, sir, that you have misunderstood ‘the meaning of the word “ question “ in standing order 408. It does not mean a question asked of a Minister by an honorable senator in the ordinary way, but the question on a motion such as “ That this Bill be now read a second time.” In the parliamentary sense there has been no question put here this session which deals with the subject-matter of this particular inquiry, and as we also know there has been no debate which has brought the matter before the Senate. The only way in which it has ever been introduced has been in the form of a question to the Minister of Defence. I respectfully submit, sir, that the matter to which Senator McDougall wishes to refer cannot come under standing order 409.
– I wish to draw your attention, sir, to another rule which, think, serves to sharply mark the distinction between a question and a debate. If I understand your ruling aright, it is that the word “debate” covers not merely a speech in the Senate, but also the giving of an answer to a question. I draw your attention to standing order 98, which reads -
In answering any such question, a senator shall not debate the matter to which the same refers.
If Senator Pearce did debate the matter to which his answer referred, he must have broken this rule, but that, I venture to think, you did not allow him to do.On the other hand, assuming that he conformed to the rule, it is quite clear that he only answered a question, and did not, within the meaning of the standing order, debate its subjectmatter, because it is a prohibition against debate under cover of a question and an answer.
-Colonel Sir Albert Gould. - With regard to quoting from debates, May says on page 310 -
The rule that allusions to debates in the other House are out of order prevents fruitless arguments between members of two distinct bodies who are unable to reply to each other, and guards against recrimination and offensive language, in the absence of the party assailed ; but it is mainly founded upon the understanding that the debates ‘of the other House are not known, and that the House can take no notice of them.
But on page 312 May says -
This rule does not apply to reports of Committees of the other House, even though the report has not been communicated to the Commons, according to a decision to that effect by Mr. Speaker. Nor can the rule be extended to the votes orproceedings of either House, as they are recorded and printed by authority.
If a question were asked in the othef House, it could be alluded to here, notwithstanding our rule against referring to the debates in that House, showing clearly the distinction between a debate on a question and a mere reply to a question. Of course, if after the Minister had replied to a question, the adjournment of the Senate had beenmoved, and the question and the reply had been debated, it would not have been competent for an honorable senator to deal with the matter at another time unless we had a special standing order allowing that to be done. I think that on reconsideration, sir, you will see the marked distinction which I have pointed out. Very often a reply to a question is necessaryin order to found a motion on which a debatecan take place.
– I take it that the standing order was made in order to prevent the most objectionable practice of reading newspaper comments. I think, sir, that your ruling should be sustained, or the standing order altered if it is not considered sufficiently strong to prevent commentsbeing read from newspapers.
– This motion raises a question of very great importance. There really is, I think, a good deal more to be said in favour of the ruling than would at first sight appear, although I am rather inclined to think that the matter could be better dealt with by an amendment of the standing order. There is no doubt that if we technically look at the standing order by itself, and interpret the word “ debate”’ in the ordinary sense, the comment which was proposed to be read has no relation to a debate as ordinarily understood. But the question is whether the meaning of the word “debate” in the standing order is not much more comprehensive than that, and does not include the proceedings of Parliament. The whole essence of this rule - which, in substance, applies equally inthe House of Customs -is that it was intended to prevent the quotation from newspapers, not only of criticisms of the proceedings of Parliament, but of reports of speeches made in Parliament during the same session. That applies now. That is to say, no member of. the House of Commons is in order in quoting from a newspaper the report of a speech made in the House during the same session. If a member quotes at all, and the quotation is in relation to the same subject as is under debate, he must quote from Hansard. That is the foundation of our rule. All our proceedings in Parliament are, of course, privileged. The publication in the press of speeches made in Parliament is, in principle, a breach of parliamentary privilege. It is for that reason that the quotation from the reports of speeches in newspapers is not permitted in the House of Commons. The same rule appears toapply to the quotation from newspapers of comments upon the proceedings of Parliament. . Therefore, if the whole of the proceedings of Parliament are privileged from publication, that rule applies equally to answers to questions, and to anything else that is done within the walls of Parliament. It is obvious that it must be so. Honorable senators will find, on page 325 of May’s Parliamentary Practice, the whole position explained -
A member may not read any portion of a speech, made in the same session, from a printed book or newspaper.
That is because the publication in a newspaper of a speech made in Parliament is, in principle, a breach of privilege.
This rule, indeed, applies strictly to all debates whatsoever -
In this connexion, “ all debates “ means “all proceedings,” undoubtedly - the publication of them being a breach of privilege; but of late years it has been relaxed, by general acquiescence in favour of speeches delivered in former sessions. It is also irregular to read extracts from newspapers, letters, or other documents referring to debates in the House in the same session. Indeed, until 1840, the reading of any extracts from a newspaper, whether referring to debates or not, had been restrained as irregular. On the 9th March, 1840, the Speaker having called a member to order, who was reading an extract cut out from a newspaper, as part of his speech, Sir Robert Peel said it would be drawing the rule too tightly if members were restrained from reading relevant extracts from newspapers; and, with the acquiescence of the House, the member proceeded to read the passage from the newspaper.
Perhaps that would have been the best way out of this difficulty. If we examine the principle that underlies this rule, we find that it would apply to all the proceedings of Parliament, and, consequently, to all proceedings inside the Senate. They are all privileged in principle.
– Then the honorable senator would regard a question and the answer to it as a debate which had taken place on the floor of the Senate?
– It is a proceeding of Parliament.
– The honorable senator does not make a distinction between “ debates “ and “ proceedings “ ?
– Can a senator speak upon a “question” that has been asked?
– No; but questions are all “ proceedings “ ; and,_ in principle, a “ question “ is as much privileged from comment in the press as any other question that is raised in the Senate.
– The tabling of papers is, then, a “proceeding” of Parliament ?
– I should not call the tabling of a paper part of our “ proceedings.” But the answer to a question is just as much a part of the pro ceedings of. Parliament as a debate is. The only question is, whether, in the technical language of our Standing Orders, the term “ debate” is restricted to debates properly so-called, or whether it is intended to refer to the whole of our proceedings.
– What was the intention in imposing all these restrictions ?
– I do not know. If the honorable senator wants me to answer him more generally, I am not sure whether some of these restrictions, which served a very good purpose when they were imposed, ought not to be very much modified, if not altogether removed. I, for one, am in favour of the enlargement of the standing order, so as to permit of the quotation of material which not merely illustrates the subject-matter of debate, but which may illustrate the public opinion existing upon the subject-matter of debate. I think that, under this standing order 409, the question is, whether the expression referring to debates in the Senate during the same session means the proceedings of the Senate which, in principle, would be privileged from publication in the press, or whether it is to be restricted to debate as properly and ordinarily understood. I do not think that the standing order is by any means clear, and I am not prepared . to dissent from your ruling.
– Whatever may be the outcome of the motion now before the Senate, I think that sufficient has already been said by honorable senators who have addressed themselves to it to show that there is a necessity for the alteration of standing order 409, in order to enable us, in the future, to determine exactly what it” does mean. I can indorse what Senator Symon has said - that “ debate,” as referred to in the standing order, is open to more than one interpretation. When you, sir, gave your ruling I was inclined at the outset to think that it was perfectly correct, because I was under the impression that what was prohibited to be read in a debate was a newspaper extract commenting upon what Senator Symon has called broadly the proceedings of Parliament. Senator Rae has asked what the object of the standing order was. If we could ascertain precisely what the object of it was, we should be far on the way to a solution of the proper construction of it. But it is very difficult to find what was the wile object of it. It must be read in conjunction with other standing orders. Senator Millen has drawn attention to a previous standing order relating to questions and answers. There is another one to which I draw attention - 401. It reads -
No senator shall read his speech.
I will put this position as conceivable : Under standing order 401, it might, in the strictly technical and narrow sense of the term, be competent for an honorable senator to read comments upon a reply given by a Minister. Suppose that an honorable senator asked a question upon some important subject. The Minister might furnish an answer, and subsequently to that, a newspaper might comment upon question and answer. That comment might be read by an honorable senator, and that comment might really be designed to be a speech upon the particular subject. So that, in that way, standing order 401 could be overcome, because the senator in question might say, “I am simply reading an extract from a newspaper commenting, not upon the debate, but upon an answer given by the Minister.”
– That is to say, if the senator marie that extract the whole of his speech. The honorable senator is taking a very wide flight.
– I am suggesting that as a possibility.
– The senatpr might make that extract the principal part of his speech.
– He might do that. Consequently the effect and substance of standing order 401 might be overridden completely. I am not putting that forward merely as an argument to show that the President’s ruling is correct, but I am inviting the attention of honorable senators to u possibility that might occur. There is another point to which I may refer. It has been asked whether a question and an answer in the Senate amount to “debate.’’ Let me invite honorable senators to consider this position : Let us assume that at the end of a sitting of the Senate, a Minister moves, “ That the Senate do now adjourn,” and that upon that motion an honorable senator rises and puts a question. Suppose that the Minister simply replies that he has no information upon the subject, but that if the honorable senator will ask the question again in a formal way at the next sitting, he will supply an answer. Suppose that the Senate then adjourns. Those proceedings, will be entered up in the Journals of the Sennte. It will be stated that the Vice-President of the Executive Council moved the adjournment of the Senate, and that “ debate ensued.”
– But is that “debate?”
– It goes down in our proceedings as “ debate ensued.” I notice that the clerical officers of the Senate are very accurate in their entries as to time. If a Minister moves, “ That the Senate do now adjourn” at 9.30, a senator asks a question, and the Minister answers himr the Journals will record that “ debate ensued,” and that the Senate adjourned at, say, 9.31. So that a question and an answer under those circumstances are regarded as “ debate.” If our Standing Orders do not meet existing conditions, we must amend them; but we cannot call a question “ debate “ for one purpose, and not “ debate “ for another.
– The motion for the adjournment of the Senate is always debatable.
– The motion for the adjournment gives a senator an opportunity of asking any question, to which a Minister may reply, and my point is that that question and that reply are technically treated as “ debate “ in the record of our proceedings.
– It is “ debate “ on the motion for adjournment.
– Why should? newspaper comment on a question be allowed at one time and be excluded if the question be put at another time?
– That is the point. I am not objecting to newspaper comments,or to the quotation of them, but I do direct attention to the fact that the settlemen of the question raised by the ruling of the President is not quite so easy a matter as it would seem at first sight. I am inclined to think that the intention of the standingorder was to exclude the reading of newspaper comments, not because it was thought they might be disrespectful, or anything of” that kind, but in order to prevent honorable senators taking up the time of the Senate by quotations from outside sources when they should be called upon to contributefrom the fund of their own information andintelligence.
– They should not quote - ready-made speeches.
– Exactly. Offering, these considerations to honorable senators, I again say that, whatever may be the result of the motion,I sincerely hope that the standing order will be amended so as to make its meaning clear and unmistakable-
– We are all agreed that the Standing Orders have been drafted for the convenience of honorable senators,and to secure the proper conduct of the business of the Senate. The simpler the form in which they are expressed, the better tor us all. Every honorable senator giving a vote on the motion will be guided by his own interpretation of the meaning of the word “debate.” We can only arrive ar a correct interpretation of the word by considering standing order 409 in conjunction with standing order 97. Standing order 409 is very simply worded, and provides that -
No senator shall read extracts from newspapers or other documents except Hansard referring to debates in the Senate during the same session.
If honorable senators will now turn to standing order 97 they will find that it provides that -
In putting any such question, no argument^ or opinion shall be offered, nor inference nor imputation made, nor any facts stated, except so far as may be necessary to explain such question.
You will remember, sir, that on many occasions when honorable senators have been asking questions, you have found it necessary to call them to order, and to insist that they should confine themselves to the question, and should express no opinion in putting it.
– With the usual words added, “ there can be no debate.”
– Yes, those words are commonly used when honorable senators are called to order for expressing opinions in putting questions. It has been ruled by you, sir, and by other Presidents before you, that questions must be put without inferences, opinions, or argument. Standing order 97 being so explicit on the point, I am at a loss to understand how any one can confuse the meaning of the word “ question,” as used in that standing order, with the meaning of the word “ debate,” as used in standing order 409. I cannot see how the answering of a question can be regarded as debate. So far as Senator McDougall was allowed to proceed with the reading of them, the extracts he proposed to quote deal with the reply made by the Minister of Defence to the questions he had put. I agree with Senator Keating that the Standing Orders require some alteration, and they should be considered by the Standing Orders Committee. Probably some modification of it can be suggested which would conduce to the better conduct of the business of the Senate- I was very much disposed, at first sight, to agree with your ruling, but it seems to me that we must deal with the standing order as it i before us, and that being so, I must uphold my own interpretation of the word “ debate “ as differentiated from the word “ question.” I shall have no hesitation, in the circumstances, in voting on the motion now before the Senate, because I contend that we must’ deal with the standing order as it is before us.
– It will be necessary for me, on this occasion, to record my vote against the ruling, sir, which you have given. I shall do so with a great deal of diffidence j but I am convinced that standing order 98 is a sufficient justification for the course I propose to take. If it does nothing else, it proves clearly that neither a question nor the answer to it can be regarded as debate. It provides that -
In answering any such question a senator shall not debate the matter to which the same refers.
It is well known that, no matter who moves the adjournment of the Senate, we are at liberty on that motion to talk at length on any question so long as honorable senators are prepared to sit here and listen to it. There is no analogy between that position and the one in which an honorable senator is strictly confined to the bare facts in any question which he desires to ask of a Minister. It seems clear to rae that very great danger might arise if the ruling were upheld and we decided that a “question” is a “debate.” For instance, an honorable senator might inform another that he intended to bring forward an important matter. The latter might ask a question in regard to that matter, and if he did so, and your ruling were upheld^ however important the statement the firSt honorable senator intended to make, the fact that the second had asked a question on the subject and received an answer would be sufficient to prevent the first from bringing forward his business, inasmuch as under your ruling a “ debate v would already have taken place. In the circumstances. I feel compelled to vote against your ruling.
– Senator Keating has pointed out what, he will pardon me for saying, is little more than a techniccality. It is a fact that on the motion for the adjournment of the Senate any .honorable senator may debate a question ; but that is not sufficient to make it clear that a question and the answer to it, in the ordinary form, constitutes a “ debate,” as we understand it. It will be admitted that in the practice of the Senate we draw a clear distinction between a question and answer and a debate. The Journals of the Senate draw a distinction between the two. I f we wish to ‘know what went on in the Senate, we refer to the Journals, and they give us no more than that information. If we wish to know anything that occurred during a debate, or to gain some idea of its value, we cannot learn that from the Journals, we must look for it in Hansard. I admit that Senator Keating has pointed out that Hansard may contain a little more. Except as a technicality, I do not think that the contention so cleverly urged by Senator Keating will weigh with honorable senators. We all understand the difference in our practice between a question and a debate, and though I should like to be able to support your ruling, I feel constrained to vote against it.
– I cannot follow the reasoning of some honorable senators in this matter. While it is perfectly true that all debatable matter is supposed to be excluded from questions, we all know that sometimes we get it in by the- method adopted in the asking of questions.
– We do not get in much under the President.
– -That is so, though I do not often, try to- do anything subversive of order-. An honorable senator in asking a question may not debate it, but the Minister in his reply very often introduces a very great deal of debatable matter.
– If he breaks one standing order, that is no reason why we should break another.
– It appears to me that the object of the standing order on which the President has based his ruling is to prevent honorable senators” reading newspaper extracts bearing On debates which have taken place in the Senate. I say that an answer by a Minister to a question put to him may afford as -much food for newspaper comment as may a debate upon the same subject which occupied the whole evening. The salient points in the policy of a- Government might be outlined in a Ministerial reply. To’ that extent it seems to- me that there is very little to choose between questions and answers on -the one hand., and ordinary debate on the other, irrespective of whether or not our standing order relates to the former. ‘ It does not seem to me that Senators O’Keefe and Henderson have made out a conclusive case.
– Does not the honorable senator think that “debate” implies discussion, and an interchange of argument ?
– Yes. Usually questions and answers constitute a very one-sided form of debate, because while an honorable senator is rigidly confined to matters of fact, the Minister in replying is allowed much greater latitude. I repeat that very much debatable matter may be conveyed in the form of a Ministerial answer, and consequently there is no reason why our standing order should not apply to questions and answers as well as to debate. From the statement of Senator Symon it appears that this standing order had its origin in ancient days when it was regarded as a breach of privilege to comment upon anything which Parliament did. If it serves no other purpose it would be more in accordance with up-to-date methods if it were swept away. We all know that by reading newspaper comments upon answers to questions an honorable senator might get in the major portion of a speech, which otherwise he would not be permitted to deliver. I admit that the speeches of some honorable senators, if they were read, would be much more eloquent than they are. Upon the whole it seems to me that in considering this standing order it would be in the interests of the freedom of honorable senators if the widest possible interpretation were placed upon it. You, sir, have erred by putting the narrowest construction upon it. Therefore, upon the principal that we should extend to the accused the benefit of any doubt which may exist, I feel inclined to support Senator McDougall.
– When you, sir, first gave your ruling, I was of opinion that it was correct. Nothing that I have heard up to the present has altered that impression. Nearly every honorable senator who has- spoken has expressed a doubt as to the way in which he should vote. As you, sir, have the best interests of the Senate at heart, and desire to conduct its business in accordance with our Standing Orders, and as a doubt exists as to whether your ruling is in accordance with those Standing Orders. I think that you should be- given the benefit of that doubt.
– Why not give the Senate the benefit of it?
– The matter was not put in that way. The fact that we have power to suspend a standing order which curtails our liberty in any way, is another strong reason why we should support the President in the position which he has taken up. I listened attentively to the statements made by eminent constitutional authorities like Senator Symon and Senator Keating. I cannot very well couple Senator Rae with them, because we should then have too much talent arrayed on one side. What is the position ? At the present time a question relating to defence may be asked of a Minister, and a reply may be given to it. Upon that question and reply the newspapers may write articles and publish letters bearing upon the whole military policy of the country. A similar remark is applicable to questions relating to quarantine, old-age pensions, land taxation, or, indeed, any other subject. If such articles were at the command of honorable senators, and could be utilized by them in debate, would not the position be just as bad as if those articles were written upon a matter which had been the subject of debate in the Senate? I intend to support the ruling of the President* who is charged with maintaining order and upholding the privileges of the Senate. If our Standing Orders are ambiguous, I am sure that if a request be made to the Standing Orders Committee, that body will remove the ambiguity or frame a new Standing Order.
SenatorGivens. - It seems to me that in discussing this motion we should strive to elucidate the subject, rather than to cloud it. I listened very carefully to the remarks of the Vice-President of the Executive Council, and with all due respect to him, he effectually attempted to make the position as clear as mud.
– A good many honorable senators have: endeavoured to do that.
– I wish to get down to bed-rock. Standing order 409 is very clear. It reads -
The whole question, it will be seen, hangs upon the one word “ debate.” You, sir, have ruled that the mere asking and answering of a question in this Senate constitutes debate. We who do not claim to be experts in the language which we speak have, therefore, to turn to authorities to ascertain the real meaning of “ debate.” According to the newest edition of Webster, page 575, the first meaning of “ debate “ is “to engage in strife, or combat, to fight, contend, quarrel.” Now, the mere asking and answering of a question cannot, by any stretch of the imagination, be held to be a fight, nor can it be termed “engaging in a quarrel.” The second meaning given to the term is “to contend in words, to dispute; hence, to deliberate; to consider ; to discuss or examine different arguments in the mind.” Now, under our Standing Orders, an honorable senator cannot engage in argument when asking a question. In other words, questions and replies to -them must relate to matters of fact. Webster goes on to give various examples of the meaning of the term’ “ debate.” For instance, in regard to the definition “ to strive or fight,” he quotes from Prescott that -
The cause of religion was debated with the same ardour in Spain as on the plains of Palestine. and in regard to his second definition, “ to contend for in words or arguments,” he quotes from, the Book of Proverbs -
Debate thy cause with tby neighbour himself.
He also points out that to constitute a debate it is necessary to discuss or argue both for and against any position, and to consider the arguments upon both sides. The mere asking or answering of a question is not debate.
Sentaor McGregor. - Was not the question and answer system of debate that which was instituted by Socrates?
-We could carry on debate by means of a very extended system of questions and answers. The very catechisms which are used in religion are cases in point. But, under our Standing Orders, it would be impossible to have debate in this Senate by means of questions and answers. Senator McGregor says that a thousand and one things may happen if the ruling is not given effect to. The impossible may happen at any time, and under any circumstances, if people are not reasonable. I contend, sir, that your decision would unduly limit the right of honorable senators to quote authorities, to illustrate their arguments, or to emphasize the view that the public might be taking in the consideration of matters of great public interest and importance, and, therefore, I intend to support the motion.
– In the interest of the privileges of the Senate it is good that a” matter of this description should come up for consideration. I do not think that an apology is ever needed from an honorable senator who disagrees with a ruling, for the simple reason that, while the Chair does its best to carry out what it thinks is the intention of the Standing Orders, and to conserve as far as possible the rights and privileges of the Senate, it is liable at all times to make a mistake. If a majority of honorable senators think that a mistake has been made by the Chair, it is their duty to vote in such a way as to retain what they consider to be the privileges or the rights of senators. I was, and still am, under the impression that standing order 409 is not so clear as honorable senators seem to imagine it to be. In the first place, it opens up a very wide opportunity for quoting from newspapers or documents in connexion with questions which may have been asked’ to elicit information, and the replies which may have been given by a Minister, and given very extensively, so as to satisfy the seeker for information. I find that in his effort to give as much information as he could to Senator McDougall, the answer of the Minister of Defence covered four and ahalf columns of Hansard. That answer would afford room for a. considerableamount of discussion in the press. On the motion for adjournment, or at any other time when the matter came up for discussion an honorable senator would be able to read the opinions of newspapers, perhaps in different States, regarding the matter, while the Chair would not be able to say that he was reading his speech, because he could interpolate certain remarks. So long as it applied only to questions which had been asked and answered, the reading of extracts from newspapers or documents would be in order. I know that the strict limitation of the standing order applies to .debate. But I was endeavouring to give effect to what I thought was the intention of the standing order. Honorable senators may think that my ruling would restrict, to some extent, the reading of quotations from newspapers. That is quite right. That was, I think, the intention of the standing order, but it was not the intention of the Chair to try to limit debate in any way, where honorable senators had quoted questions from Hansard, and were supplying their own comments on those questions. I realize that it may, perhaps, in one direction, as pointed out by Senator Gould, be the means of a considerable amount of restriction. I recognise that if a question could be asked to-day, and by that means a debate on that matter later could be burked, it would be a very great inconvenience, and restrict the rights and liberties of honorable senators. I am very glad that this discussion has arisen. I hope that if honorable senators think that my ruling would be restrictive of their rights, they will have no hesitation in voting that it was a wrong interpretation of the standing order, and then it will be for the Standing Orders Committee to see that the rule is made clearer, and that the rights and privileges of the Senate are preserved.
– I hope, sir, that honorable senators will take a stand on this matter, as you have invited them to do. I am very much afraid that your reply may have clouded the issue. It is not a question as to whether your interpretation of the standing order is right or wrong, or whether the Standing Orders Committee should make another rule, but whether honorable senators can be considered to have entered into a debate merely because a Minister has been asked a question and has replied. We have to determine the meaning of standing order 409. You, sir, have given a decision that, under that rule, if a question has been asked and answered, that is a debate. Senator McDougall asked the Minister of Defence a question without notice, and the Minister’s reply occupies four columns of Hansard ; but there was no chance to debate the question, and we would have been ruled out of order if we had attempted to do so. Senators Keating and Symon have said that if, on the motion for adjournment, an honorable senator puts a question to a Minister, debate ensues. I am well aware that on that motion we can debate anything; but if an honorable senator rises at the beginning of a sitting, he can only ask a question of a Minister, and get the stereotyped reply, and the President will not permit either the honorable senator or the Minister in reply to debate the matter. Whilst I admit that, perhaps, it would be wise for the Standing Orders Committee to amend standing order 409, we ought to determine now whether your ruling is right or wrong. I sincerely hope that the Senate will carry my motion.
Motion - That the President’s ruling be dissented from - agreed to.
– I wish to inform Senator McDougall that he has only five minutes in which to speak.
– I do not intend to read the extract now. I have something else to say. It was my intention to read the quotation, because it deals with the manning of the forts.. It shows better than I could possibly show the reason why this officer should have been left in the position which he held. I have tried to point out to the Senate that an injustice has been done. No better tribute could be’ paid to the qualities of that officer than the fact that hundreds of men who had served under him for years were willing to lay down their tools of battle as a protest against the injustice done to him. I think it is unfair for anybody to say that the officer has attempted to influence the men in one way or the other. Some of the proposals of the military authorities in reference to the manning of this fort are farcical. They have reinforced these companies by youths from the Cadet Forces, and brought in a regulation that they are to be taken into the Australian Garrison Artillery because of the districts in which they live. We see lads of 5 feet nothing and 5 ft. 1 in. drafted into these regiments. Will any one say that these lads are fit to tackle 100-lb. shells at the rate of twelve a minute? At the same time, we find youths of 6 feet and 5 ft. 6 in. drafted into the field regiments, where they have not heavy work to do. There is a certain amount of discontent with the administration of the Defence Act, and the discontent is growing. So long as we try to put these little disabilities on our young soldiers that discontent will grow so far that those who created the system of compulsory training will surely regret it. The .Minister of Defence should try to administer the Act in a way which will make the young men feel that they are doing work for the love of their country, and that there is no desire on the part of the Government or the officers to harass them in any way. We hear of this discontent from one end of the country to the other. Only yesterday Mr. George Rutter, the secretary of the Trades Hall, told me that he willingly gave his lad up to the training, but that the officers had absolutely made a wreck of him.
– Order ! The honorable senator must confine himself to the subject-matter of his notice.
– I had no desire to transgress any rule, but I thought that I was leading up to the very matter which I wanted to discuss. I was speaking of the discontent in our Military Forces and in the Cadet Forces. That is the reason why I moved the adjournment of the Senate to-day, and that is why the Australian Garrison Artillery took the step which they did. I ask that an impartial inquiry be held, when evidence could be obtained from all sides, and the militia officers would be able to state their case. That is, I think, a. just and fair request. .My desire is to see matters proceed smoothly ; but, unless this feeling of discontent is allayed, it will grow until drastic action will have to be taken. We have been told by an officer, in one of the replies given by the Minister, that there is no comparison between the Permanent Forces - that is, the Royal Australian Artillery and the Australian Garrison Artillery. In other words, he means, “ They will never be like us.” The social caste which is rising between the militia and the permanent officers is, to a great extent, the cause of the present trouble. It is a feeling which we ought to break down, and break down with a firm hand. The officer who has been deposed from his position does not belong to the military caste.
– The honorable senator’s time has expired.
– I think it is to be regretted that Senator McDougall, in bringing this matter forward to-day, resorted to reflections of a personal character, based largely on street-corner gossip and tittle-tattle of which he has, and can have, no personal knowledge. This was obviously done out of personal ill-feeling to myself. The statements he made had absolutely nothing to do with the matter at issue. They had regard to my own qualities of personal courage and of intelligence, and the motives which actuated me in taking the action I have done regarding this matter. I say that it is regrettable that the honorable senator could not ventilate a subject of this kind without descending to such tactics. I do not propose to reply to them, but shall treat them with the contempt they deserve. Coming to the question itself, and endeavouring to separate it from the things which had nothing to do with it - the honorable senator ‘Started off by making three charges which, he said, he proposed to substantiate. The first was that I, or some one else - he did not specify whom - has thrown dust in the eyes ‘of the people. The second was that certain Teports - he did not specify which - were altered. The third was that matters have been introduced to distract attention. As to the first charge, of which no proof was produced, if the honorable senator refers to statements made by myself in the Senate last week, I have only to say this: I have no personal feeling in this matter whatever. Major Chaseling. the officer to whom Senator McDougall referred, was an entire stranger to me until I met him. at the dinner of which honorable senators have heard. I had never seen him before, and there was no personal feeling in my mind regarding him. There would be no object in “throwing dust in the eyes of the people.” Obviously, it “would have been very much easier for me to do what the honorable senator has been asking me to do. By taking that course, I should have earned his good-will and escaped his criticism ; whereas, by taking the course which seemed to me to be the right one, I have apparently drawn upon myself his ill-will, as well as his opposition. As regards the alleged suppression of reports, I have to say that I read to the Senate last week the full report forwarded to me by the Staff Officer for Artillery, New South Wales, Major Osborne. I made no attempt to suppress any portion of it. The honorable senator himself to-day quoted from Hansard a portion of it. The report is before him now. I ask the honorable senator - I challenge him - to point to any portion of it to show that I have either supressed or altered it.
– Did that report come to the Minister direct from his officers?
– It came to me from the Commandant, New South Wales, and from the Chief of Ordnance.
– Can the Minister say that it is all there?
– I rise to a point of order. The Minister has wilfully misrepresented what I said. I said nothing of the sort. I stated the three charges which I made, and I challenged him to produce a report from Major Chaseling, the commanda nt of this regiment.
– That is not a point of order.
– The honorable senator referred to reports having been suppressed by me. The report which I brought before the Senate was the report which was furnished to me, and I quoted the whole of it. It is in Hansard. Senator McDougall will find, if he chooses to make a comparison, that the original report which is now before me tallies exactly with the report in Hansard.
– Idid not say what the Minister alleges.
– I listened to the honorable senator in silence. Will he allow me to reply ?
– No; if the Minister makes misstatements, I will not.
– The honorable senator spoke as if there were a number of reports. This report was from the Commandant of the Garrison Artillery, and in it he epitomizes the reports from various officers commanding in the forts. That report, I say again, I quoted in full. As to reports having been altered, I have to say that the report which I quoted came to me through the proper channel, and it bears the original signatures of the officers through, whose hands it passed. First, it bears the signature of the officer who penned it, Major Osborne. It bears the stamp of the NewSouth Wales District Commandant’s officeIt shows that it was forwarded by the District Commandant, and has his signature upon it. It is also signed by Colonel Wallace, and bears the stamp of his office. To say that a report of that kind has beer* altered is simply to make a . reckless charge without backing it up by a tittle of evidence. I say that it is unworthy of any honorable senator to do that, unless he has something: more than vague suspicion to support his statements.
– I understand the Minister to say that the . report was epitomized by some one.
– The report is an epitome of reports from company officers to the staff officer.
– It might be advisable to get the original reports from the company officers.
– I am prepared to do that. I never pretended that this was a company officer’s report. As I mentioned, it ris signed by the name and title of the officer who furnished it. It indicates that that officer was giving an epitome of the reports of company officers. I can show that by indicating paragraphs in it.
– Does not the Minister see that even the work of drawing out an epitome may have led to a misunderstanding?
– For instance, the report says in one paragraphs -
The officer commanding 5th A.G.A. (Captain Forsyth) informed me by telephone this morning that about eighty resignations had been received.
And, again -
Major E. W. Warren, commanding the 6th A.C.A., reported by telephone this morning - .
These company reports were called for hastily. I asked for them immediately I saw in the press that trouble had occurred. Major Osborne was instructed to make a report the next day. Other reports have come forward as matters have developed.
– Information gathered* over the telephone is not like an official report. .
– Major Osborne had to communicate with the company officers over the telephone in order to get information hurriedly, as soon as he received instructions to furnish a report. These facts were read to the Senate, and will be found in Hansard in the very report from which Senator McDougall quoted. Then again, the honorable senator alleged that I had introduced matters to distract attention from the point at issue. I have done nothing of the kind. I told the Senate that there are other questions at issue between the Department and the men who have resigned than the question which distracts the honorable senator so much. The only question which he cares about is Major Chaseling and his disappointment.
– And the discontinuance of the regiment.
– No, the honorable senator does not care about that, because he tells us that he advised the men not to serve. Obviously, therefore, he is not concerned about that. But he is concerned about Major Chaseling’s position. I made the statement last week that that was not the only cause for discontent, and that the chief cause was the fact that under the new regulations these men. who in the past had been called upon to’ go into a camp of continuous training for eight days in each year, were now being called upon to sacrifice seventeen days in each year.
– Does the Minister say now that that is the chief reason?
– Yes, I do; and more than that, I say that in some of the companies it was the sole reason. I am prepared to produce proof of that statement to-day. I say again, that as far as the militia garrision artillery was con cerned, that was the principal point at issue, and that when the regulation was changed much of the discontent disappeared.
– Can the Minister give us the effect of the alteration?
– I am going to do so. The effect of it in New South Wales is as follows : - No. 3 Company, Newcastle, from which a number of resignations were received - all resignations have been withdrawn. No. 4 Company, Sydney - no returns available till Thursday night; that is to-morrow. No. 5 Company, Sydney and Wollongong - no Wollongong men have resigned, although the press” statements in Sydney were that a number of them intended to resign. No returns are available concerning the Sydney men until Thursday night. No. 6 Company. Sydney, at a parade held on the 2nd instant, all the men on parade signified their intention of remaining on under the new conditions.
– How many men were on parade?
– There were twentyeight. The remainder are being communicated with, and returns will be available on Thursday night.
– How many compulsory trainees are included in the twentyeight ?
– None, I think.
– Will the Minister say how many resignations have been absolutely withdrawn?
– Yes, I can make a comparison. In 3rd Company, Newcastle, there were twenty retirements; they have all been withdrawn. In 5th Company, Sydney and Wollongong, forty retirements were put down, but there is no statement as to how many have been withdrawn so far as Sydney is concerned. As I have already stated, none of the Wollongong men resigned. In the 4th Company, Sydney, there were eighty retirements of men, and three of officers.
– It appears that out of 143 resignations there have been twenty withdrawn so far.
– But it has to be remembered that since the order with reference to camp has been altered, the two Sydney companies have not had an opportunity of considering whether they will continue to serve under the amended conditions. I was dealing with the reasons for these resignations. T say, as I said last week, that one of the chief reasons was the alteration in the number of days for which the men were called upon to attend camp. When we remember that these men are for the most part working men, it is obvious that the change from eight to seventeen days’ camp caused a liability of their not being able to remain so long away from their industrial occupations.
-Colonel Sir Albert Gould. - At what time of the year do they go into camp ?
– Usually at Easter time. Another cause, which I gave last week, and which I repeat now - because it is given to me not only by permanent officers, but by citizen officers as well - is the abolition of the canteen. I say with regret that some resignations have been caused by reason of that change, as well as on account of the regulation regarding cigarette smoking in camp.
– Cigarette smoking on the part of men?
– Yes, in the camps of universal training.
-Colonel Sir Albert Gould. - Can they smoke a pipe?
– Yes. I am of the opinion that there has been a misunderstanding on that matter, because I have seen the regulation referred to in extracts from the Sydney press as “a prohibition of smoking.” But that does not obtain.
– Does the honorable senator seriously mean to say that he is going to prevent grown men from smoking cigarettes if they like to?
– Cigarette smoking amongst senior cadets and trainees has been prohibited.
– But apparently the Minister is applying the regulation to militiamen.
– Because, it has to be remembered that the militia and the trainees are in camp together, and that you cannot have two sets of regulations working side by side. If you have a regulation of this kind applying to the trainees, it must also apply to the militia. But the reports that I have received on that point jshow that the dissatisfaction regarding cigarette smoking is not anything like so strong as it is in regard to the abolition of the canteen. Those are the two most important points. As regards the question which Senator McDougall appears to think is the chief cause for these resignations - namely, the abolition of the regimental staff - I have here an extract . from the Newcastle Morning Herald and Miners Advocate, of Wednesday, 31st July, The whole gist of it is to show that, so far as the Newcastle men were concerned, the sole cause of complaint was the extension of the days of training. They were not concerned about the abolition of the regimental staff. That is a statement which was made by a militia officer, Captain Robb, and not by a permanent officer.
– Is it a signed article ?
– No; a statement made by Captain Robb to the representative of a newspaper. The Newcastle men were not in the least concerned about the abolition of the regimental staff. I propose to give the Senate the benefit of the advice by which I was guided in adopting the proposals not merely as regards Sydney, and certainly not with any regard to Major Chaseling,” who is a complete stranger to me, but because the principles set forth seem to me to be sound. The proposed change had been put into force in Victoria over six months before;, it was in actual operation at the last camp, and officers and men accepted it without question or demur.
– Was there any “ winking of the eye “ ?
– I am speaking now of the abolition of the regimental staff. There could beno “ winking of the eye,” because the staff was abolished in Victoria before action was taken in New South Wales.
– The fortress commander in Victoria was not a militia man, but a permanent man.
– The honorable senator is wrong ; he was a Melbourne solicitor.
– In the Sydney case the fortress commander was not a permanent man; that is where all the difference comes in.
– The fortress commander in Sydney was a well-known militia man. This is what the Chief of Ordnance, Colonel Wallack, had to say on this question -
Misapprehension appears to exist as to the reasons for the reorganization which is taking place in the Australian Garrison Artillery. This reorganization, however, is being effected in order to make war efficiency the basis of all our peace arrangements; it is not by any means an attempt to cast a slur upon the qualifications of the Citizen Forces officers, of whose services there is no lack of appreciation at Military Head- quarters. Hitherto the peace organization of the Australian Garrison Artillery has not been based upon any definite estimate of war requirements. Consequent upon Lord Kitchener’s recommendation this defect is now being remedied.
The first step necessary was the appointment of Commanders of Coast Defences, who would be responsible for the training and efficiency of all the Artillery and Engineer Units allotted to the respective districts over which they were given control. Such officers were originally the Staff Officers for Artillery of respective Military Commandants, and had practically the same responsibility as regards the training and efficiency of Artillery and Engineer units. But, in addition to them, however, there existed a Regimental Staff of the Australian Garrison Artillery. For the maintenance of such a Staff there was not then, and there is certainly not now, any justification. A Lieutenant-Colonel’s Command in Garrison Artillery comprises the command of a certain number of batteries to which a certain number of companies are allotted at a defended port. In other words, it constitutes a Fire Command. Lord Kitchener recommended that the first relief of all the guns of the . fixed defences of Australia should be provided from Permanent Units, and that the Australian Garrison Artillery should be so organized as to provide a second relief. Funds have not so far been available to comply fully with these recommendations, and a certain number of men of the Australian Garrison Artillery are still required to complete first relief.
To provide a Regimental Staff for the necessary Australian Garrison Artillery Companies, however, means an additional cog in the administrative wheel, and it may so happen that such a Staff would be redundant to the requirements of the Artillery Manning Tables. A Lieutenant-Colonel’s Command in Artillery depends on the needs of such a Manning Table, and not on the wish of companies to have their peace command and administration provided for by the appointment of a Regimental Staff.
Positions as Fire Commanders are still open to officers of the Australian Garrison Artillery who prove themselves qualified to hold them.
The system about to be inaugurated in New South Wales has been in operation in Victoria since 1st January last, and at the recent Annual Continuous Training was found to work admirably; its success was so unmistakable that its operation in New South Wales is expected “to produce an equally beneficial result.
– If the recommendations of that report are carried out, it means that no citizen soldier need look for promotion to these posts.
– I want to correct that impression nl once. So far as the citizen soldiers are concerned, the only posts abolished will be the commands of regiments of the Australian Garrison Artillery. But, as Colonel Wallack points out the position of fire commander will still be open to citizen soldiers. We have just heard from Senator - I was going to say Colonel - McDougall that the position of fire commander is one of the most im portant positions in the Forces. It will still be open to militia officers, and they can go to the rank of lieutenant-colonel.
– I can prove that it was refused to Major Chaseling.
– The honorable senator is making some very rash statements. I am prepared to make the statement that Major Chaseling, the officer whom Senator McDougall has been championing this afternoon, was offered the position of fire commander, and declined it.
– No; he was offered the position of company commander of the fourth company ; that is all he was offered.
– No; he was offered the position of fire commander.
– No ; nothing would have pleased him better. The position of fire commander is the most important position in the garrison.
– The fact remains that the positions of company commander and fire commander will still be open to militia officers. But it is obvious that when we have to put the command of a fortress, as a whole, under a permanent officer who has a staff, as they all have, it would be a mere duplication to provide a fifth wheel for the coach in the shape of a regimental staff of militia, merely because some of the men required to man the forts belong to the militia. The abolition of militia fortress commanders rendered it necessary, if we were to be logical and consistent, to abolish the attached regimental staffs. The position of fortress commander, on the best advice we could get - that of Lord Kitchener - should be in the hands of a permanent man. Although! Senator McDougall has said that Major Chaseling lives just alongside the barracks, that has nothing to do with the matter.. The difference between the two men is that one is an officer always under orders, and whose duties take him in and out of the fortress and amongst the men, and the other is an officer who gives to the business only the time he can spare from his ordinary avocations.
– The honorable senator can leave out the reference to the place where Major Chaseling lives. He introduced that matter; I did not.
– The Minister brought it up by saying that at permanent offices was required to guard against surprise..
– Yes, and then Senator McDougall said that Major Chaseling lived just alongside the barracks. The point, however, is that we require in such a position a permanent officer, who is always under orders, rather than a man who merely puts in his spare time at the work. Honorable senators must see that if they do not object to the fortress commander being a permanent man, they admit that the necessity for the regimental staff is gone. I am not a soldier. I have said that before, and I say it again. I have to be guided on matters such as this by the expert advice provided for me by the country. I know that there is always a tendency on the part of permanent officers - perhaps I had better say an unconscious bias - leading them to depreciate militia officers. The Minister of Defence has to be on his guard to see that that is not done.
– That is the cause of the whole difficulty.
– Whilst the Minister ofDe fence needs to be on his guard to see that militia officers are not depreciated by permanent officers, no Minister who was not a military man would turn down military advice without having very sound reasons for doing so. When these propositions were put before me, I investigated them to the best of my ability, and I was unable to find any reason for turning them down.
– The honorable senator can now see the result of that.
– I can, and I am prepared to accept it. Having for such reasons decided not to turn down these propositions, I certainly cannot do so because Senator McDougall chooses to treat it as a personal matter, and to make attacks upon me. I have already disclaimed any desire whatever to injure Major Chaseling. I have no personal feeling towards him. If anything, mv wish woulcl be to give him the benefit of the doubt if there were one. But after full investigation of the matter, it seems to me that those who have submitted these propositions for the abolition of the regimental staff have submitted unanswerable arguments in their favour. They have also proved that what they did in Victoria under precisely similar conditions was accepted without a murmur, and that the results of the change have been satisfactory.
– That is a permanent officer’s opinion.
– It is not only that, but it is hacked up by the results obtained at the last camp of training. In view of these facts, I say that it is unwise to try, by bringing political pressure to bear, to achieve in that way what could not be achieved on the merits of the question. I venture to say that any person who dealt with the matter on its merits could come to only one conclusion. We have to remember that to-day a fortress is practically an arsenal of highly technical machinery. Our fortresses are armed with up-to-date guns, magazines, and all the necessary paraphernalia. I have been taunted because effect has not been given to Lord Kitchener’s recommendation with respect to the second relief.
– Are these men less competent than the permanent men?
– Undoubtedly they are.
– Although they win in the competitions every time.
– The honorable senator overlooks the fact that in class-firing the standard laid down for militia men is lower than that for the Permanent Forces. It is recognised that with the time they are able to give to the work, militia men cannot expect to reach the qualification demanded from a permanent man.
– The target is not any nearer for the militia man.
– I wish to reply to the taunt that we have not yet carried’ out Lord Kitchener’s recommendation as to the second relief.
– No; as to the first relief.
– It is true that we have not carried out the recommendation as to the second relief, but there is an obvious reason for it which honorable senators can discover for themselves if they scan the Estimates for this year. When they see that we propose an expenditure of £5,500,000, I need not give them any other reason than to say that to fulfil the recommendation referred to, we should have to double the expenditure - for that is what it means - on our Permanent Forces to-day. We are, however, doing something to meet the difficulty. We recognise that the great difficulty in time of war woulcl be to provide a sufficient number of noncommissioned permanent officers and specialists in certain lines. We are providing in the Estimates for a certain additional number of such officers, and also to complete the first relief for the Royal Australian Garrison Artillery. That is the best we can do with the money at our disposal this year.-
Senator McDougall will have an opportunity when the Estimates are being considered to resume his attack upon the Government. He may blame us for not having gone further, but I think that honorable senators who consider the amount of money proposed to be expended on Defence will be of opinion that we have gone far enough.
– The Minister’s time has expired.
– There is one matter upon which I desire to say a few words. I am not sufficiently familiar with the details of this question to attempt to take any serious part in its discussion. I merely wish to direct attention to a probable reconciliation between the very grave statements made bySenator McDougall and the reply given by the Minister this afternoon in regard to the accuracy of the report which the Minister read last week. I understood Senator McDougall to affirm that that report was inaccurate in three particulars. He declared that certain matter had been suppressed, that other matter had been altered, and that certain other matter not in the original reports had been introduced. These are very definite and very serious charges. The Minister appears to take the accusation of the honorable senator as one directed against himself. But it will berecollected that when Senator McDougall was speaking, 1 asked him who was responsible for that suppression, and that, with a deliberation for which he is not always remarkable, he gave me my choice. He said that I could please myself as to whether I thought it was the Minister of Defence, or whether I believed that the offence had been committed by somebody else before the papers found their way into the Minister’s hands. This afternoon, in reply to a question put by me, the Minister admitted that the report which’ he was reading was an epitome-
– There was no need for any admission. I said so plainly last week.
– The Minister is getting annoyed. Apparently one must not criticise him in any way-
– Why speak of my statement as an “ admission “ ?
– Because, in answer to a question which 1 put to him, the Minister admitted that the report which he was quoting was an epitome. However, if the
Minister chooses to take my remark in that way he is welcome to do so.
– I do take it in that way.
– The Minister stated that the report which he was reading was an epitome of the report of several officers.
– I said so last week.
– Now we all know what an epitome is. If a report were given to any honorable senator to epitomize, he might quite unintentionally give it a different colouring from that which the author of the original document intended.
– Insome cases there were no original documents. The reports took the form of telephone messages.
– The officer whotook the messages might very easily have made a mistake.
– There is one of the officers’ reports missing.
– Senator Pearce appears lately to have taken up this position : that what he says must not be challenged - that the utterances of the great Minister of Defence must not be criticised by anybody. Whenever any matter ‘connected with hisDepartment has come under review in thisChamber, he has invariably lost his temper. So far as I am concerned, he may go on losing it. I will help him to find it. In this case, it appears to me that there is a very reasonable explanation of the wide divergence between the statement of Senator McDougall and that of the Minister. It seems possible that some person, quite innocently, in endeavouring to epitomize die reports of several officers, has not accurately . given us the purport of these reports. But Senator McDougall has stated that one report is entirely missing.
– How can there be any report missing when this officer was instructed to report.
– I am surprised to hear the Minister ask how a report can be missing when this officer was instructed toreport to some other officer. Evidently hetakes the view, not only that he himself cannot make a mistake, but that the officer who reports to him cannot make a mistake.
– He was called upon, to report, not to collect other reports.
– The very definite statement has been made by Senator McDougall that there is a report missing.
– Why does not the honorable senator read the reports in Hansard?’ He would then know what he is talking; about.
– How can I read in Hansard a report which does not appear there ?
– Lieutenant Chaseling’s report - the officer in command of the 5th Company - is missing.
– He was not asked to make a report. Major Osborne was asked for it.
– Upon the Minister’s statement, it may as well be proclaimed throughout Australia that our citizen officers cannot hope to attain to equal positions with our permanent officers.
– That is a grossly unfair statement to make.
– Anything is unfair if it be in the nature of a criticism of the Minister. The honorable senator himself has said, “ I place myself in the hands of my permanent officers, and when they make a recommendation to me I am not going to turn it down.”
– I never said anything of the kind.
– The Minister said he would require very strong reasons before he would turn it down.
– The Leader of the Opposition was not fair enough to quote that.
– The Minister is one of the freest men to hurl accusations against other people, but he is one of the touchiest when they are made against himself. Let me take the words to which he now assents. He says that, after calling for reports from his permanent officers, he would require the strongest reasons before he would turn down their recommendations. In practice that means that in 999 cases out of 1,000 he will adopt their recommendations. The prejudice of these officers will invariably lead them to report in favour of permanent officers, as against our citizen officers. As the Minister is going to adopt their recommendations in 999 cases out of
– I said that, did I not?
– Their reports will always be prejudicial to our citizen officers. That is what has happened in this case.
– I suppose there are about 1,000,000 permanent officers in the Commonwealth ?
– They are always sufficiently strong to carry the day against our citizen officers. I say that our Citizen Forces will be demoralized if the Minister allows himself to be dominated too much by his permanent officers. I do not dispute the fact that the permanent officer should, generally speaking, be a better adviser than should the citizen soldier. But it seems to me that if we lay down the position that the permanent officers, wifEout adequate Ministerial check, are to be permitted to differentiate in favour of the permanent men, as against our citizen soldiers, we shall publish throughout Australia that the only men who need bother about admission to our citizen army are those who are destitute of any ambition to rise in the service of their country.
– I regret that in this dispute between the Minister, his permanent officers, the militia officers, and Senator McDougall, the militia officers have sought to enforce their way by the drastic method of resignation. I merely rose to express publicly my regret that, in a dispute of this character, those who deem themselves aggrieved have thought fit to attempt to force the hands of the Minister, or of any officer, by tendering their resignations.
– I do not feel competent to discuss this matter at any length, but I do think that the Leader of the Opposition was very unfair in his attack on the Minister of Defence. It seems to me that he attempted to badger the Minister, and endeavoured to twist his statements into admissions wrung from him against his will. I do not think that is a. fair way of debating this question. I do not agree with a good deal that the Minister does ; but I recognise that he occupies the most difficult position in the Ministry. It seems to me that if there be any way out of this “trouble, it will be by the creation of some kind of civilian board of advice, which may be able to curb the pretensions and arrogant spirit which animate the military Johnnies.
– Or parliamentary Johnnies ?
– If the term which I employed offends the high-born courtesy of Senator St. Ledger, I cannot help it.
– I think that courtesy ought to be observed here.
– It is merely a difference of opinion, and I have as much right to set my own standard of courtesy as I have to accept that of Senator St. Ledger. The term ‘ ‘ military Johnnies ‘ ‘ - even if it be not contained in Webster - is better understood than are a good many words which are to be found there. I think we can justly say that there is a military caste who, unless we continually fight them, will, as they have done in other parts of the world, attempt to secure dominance, and trample civilian rights under their feet. In that respect I agree with all that has been said to-day. I think that the Minister is in an unfortunate position. While he states that he must accept the views put forward by his responsible military officers, unless there are the strongest possible reasons for turning them down, he has ignored the possibility that under that state of affairs, to which he feels himself committed, he is in danger of being a mere puppet in their hands, because, if there is no outside body whom he would recognise as capable of supplying authentic information in the direction of putting the other side of the question, or various questions which arise, then whatever strong reasons exist may never be formulated or placed before him. It appears that all the time we are in the unfortunate position of having to accept practically military domination by the mere fact of not having any recognised authority which could put forward the civilian aspect of matters.
– As regards this particular case the civilian or militia side was put to me.
– Yes, but the Minister does not seem to understand the point I am trying to drive home, though that may be owing to my want of lucidity. It is that while an aggrieved person or a company serving under an aggrieved officer, or one who thinks that he has been injured, may be able to put one side of the question, there is no authoritative body other than those who are dissatisfied to represent them, and give what may be termed something like authoritative expression to their views? We cannot listen to the man in the street or to the public-house rumour. Who is there to give authentic information in order to place the position as strongly in one direction as the high military officials can put it in the other? This has raised a question which seems to me to invite the Parliament to seriously consider the advisability of having a civil power which would be able to safeguard the interests of, not merely the militia, but the general public, against the strong views which can be expressed by the Military Board on matters in which civilian interests have no representation. We never can be certain of getting justice in such a case as the one on which Senator McDougall has based this motion for adjournment, where we ha%’e the prejudices, and general outlook, of the permanent military officers in active hostility to the views of the other side, because the latter only speak when they are personally aggrieved, and everything which they say is therefore - and more or less properly so - liable to be discounted. We want some board or body to speak with the same authority on behalf of the nonpermanent men and the general public as those who now speak on behalf of the permanent men, and for that reason seem to get the ear of the Minister much more readily. Furthermore, if I am not straying beyond the terms of the motion, the reason given by I he Minister for not carrying out certain recommendations, namely;, that it would involve an enormous additional cost, may be perfectly sound, but if, as he states, between ,£5,000,000 and £6,000,000 is to be expended on defence this year, we ought to have a very much more reliable guidance than can come on the one hand from the Minister, who confesses that he has no technical knowledge, or on the other hand from his officers, who have no responsibility. Here, according to the Minister’s own statement, all the professional knowledge rests with the permanent officers, whilst they, as the nucleus of a military caste, are interested in the growth and increased importance of the Defence Forces on the one hand, and he has to take their reports and accept their recommendations on the other.
– That does not affect the policy.
– It must affect enormously the growth of military expenditure.
– That is determined by policy.
– It is in its larger aspects.
– You do not need to be guided by that in your policy. We have not been guided by that very largely in our policy.
– I should say that we have in one sense. Here, for instance, is the report of Lord Kitchener, who is a professional soldier.
– We did not adopt his policy in regard to the Military College. We did not charge for admission as he recommended we should do.
– Just so. I do not say that the Government have adopted Lord Kitchener’s report in every detail. Either we want a civilian board to assist the Minister, and in some official way to counteract the views, which may be inimical to the general interest, which may otherwise be forced upon him by the permanent military men, or we should have a military man to administer the Department.
– Have we not such a board in the Parliament.
– Yes, but Parliament has so many things to do that it cannot concentrate its attention upon any one of them.
– We have tried both plans - a citizen board and a general officer commanding - and dropped them.
-I do not want to see the functions of Parliament handed over to boards or commissions, because that would be a confession of the failure of eur political institutions.
-Colonel Sir Albert Gould. - Parliament wants to determine the principles on which the defence of the country shall be provided for. Then it must be left to a professional man to say how that is to be carried out.
– We need to keep a careful watch on the professional man, and I should give him very little latitude, because the experience of the civilized world-
– Order ! I would remind the honorable senator that he is not touching the subject-matter of this motion at all, and that is “ the recent resignations from the Australian Garrison Artillery at Sydney.”
– I think, sir, that I have so nearly exhausted my time that if I have not touched upon the matter it is too late to make a start now. I apologize for the transgression.
– I am very pleased to support Senator McDougall in bringing this matter before the Senate. I do not want to see any Board established outside the Minister of Defence. I was rather astonished at Senator Rae first accusing Senator Millen of twisting the Minister’s statement, and then going at any length to twist what he said in regard to the advice he took from his expert officers- I understood the Minister quite clearly to say that, unless the reasons given to the contrary were sufficiently strong, he could not turn down their advice, and not that he was not acquainted with what was going on. Although there were no reasons sufficiently strong to induce the Minister to avoid these difficulties, yet, in’ view of what’ has. since transpired, there, must have: been very serious reasons indeed why 140 reasoning and reasonable beings - ordinary citizens - handed in their resignations. That is not a thing which is likely to be done at the beck or call of any officer.
– I did depart from the advice of my responsible officers because of. that occurrence ; I did away with the seventeen days’ camp, and reverted to the eight days’ camp to meet the feeling of dissatisfaction. I claimed that the extension of the camp was the cause of the dissatisfaction.
– I think that it was one of the causes. I take it that the decision to which this large body of reputable men came would not have been arrived at unless they had a number of serious grievances. A discussion of this kind will clear the air to some extent but what is likely to be the result ? Is anything to be done to put the regiment back on its old footing? Is anything to be done to restore the confidence of each man, which must have been severely shaken before he took the serious step of handing in his resignation. I contend that some action should be taken. No doubt, when a change is made, there will always be a number of dissatisfied persons. The Minister relied largely upon the fact that when the change was made in Victoria there was no friction; but it seems to me that the conditions obtaining in Victoria were not identical with the conditions in New South Wales. There was no one here, perhaps, sufficiently interested in the change to take any action. The fact that the men in Sydney resigned satisfies me that they take a deep interest in all that is happening to their country. I prefer a class of men who are not prepared to take every order or regulation as a mere matter of military disci-, pline - to swallow it and say no more about it, no matter how distasteful it may be to them. To my mind, the resignation of these men at Sydney is the most serious matter which has yet confronted the Defence Department. Not only has Senator McDougall been aware for months of the existence of this dissatisfaction, but he has been endeavouring to prevent the dislocation which has taken place. I deeply regret that the permanent officers and men havenot been able to get . in touch and sympathy with the partially-paid men or militia, because, serious as is this matter at present, it may become more serious still. No matter what advice may have been given to the Minister, there has been good and ample reasons brought forward for holding a full inquiry - not one which will be confined to the mere question of whether these men object to a regulation, but one which will elicit information as to whether there was really anything to justify the serious step which they have taken. I belive that, if an impartial inquiry is made, it will give the aggrieved persons an opportunity, not only to put their grievances before the Minister, but also to put themselves right before the general public. It is, I think, almost an unheardof thing for soldiers to resign in a body because of any regulation or order. That is a great deal worse than men going on strike. We may take it for granted that, whenever men take that attitude, there is something very wrong. This matter should not be allowed to rest where it is, but an opportunity should be afforded to the men to state their case in such a way as not only to justify their action, but also to justify themselves in the eyes of the public. I think that a full inquiry, right down to bed-rock, should be ordered by the Minister. If it is inconvenient to the military people, they may set their backs up against an inquiry into what they have done. If a full inquiry is ordered, it will be an intimation to military officers that if they subject any section of the Defence Forces to conditions which are considered unfair, the Government and Parliament will see that any legitimate grievance is investigated.
– There is a King’s regulation that shuts their mouths.
– That is one of the difficulties that we are “ up against.” If there are regulations which prevent this Parliament, representing the people, from doing what it thinks it ought to do, there is a simple if rough method of dealing with the matter. That is to say, Parliament can refuse to vote any funds for building up a ‘military system that will eventually, if we continue it as at present, cause even greater dissatisfaction. The method that I would adopt would be to refuse to vote any more money for military purposes.
– I wish to disabuse the mind of the Minister of the idea that I have any personal feeling in this matter- 1 have none whatever. What is more, he has my sympathy. I approached the Minister months ago, knowing what the result would be if the grievances of the men were not attended to. Is there, any honorable senator who would not think that he had been ignored if, when he asked for an interview with a Minister, it was not granted, his letter not even being answered ? But, nevertheless, I did not take umbrage. These men waited on me as soon as the order for the abolition of the staff was given. They, asked me to interview the Minister and try to dissuade him from carrying out his intention. They told me that every man in the regiment was prepared to resign, out of loyalty to the best commander they ever had. I said to the men, “ Do not do that.. That is a threat. Do not threaten the Minister or the authorities. I will do what I can, and I honestly believe that something will be done to find a way out of this very disagreeable situation.” I asked them to postpone taking action for twelve months. But the order had gone forth. I do. not blame the Minister for ‘ being firm if he thinks that a thing has to be done. But if he could back down in regard to the regulation as to the period of camp training, why could he not do so in regard to the abolition of the regimental staff ? I have done my level best to bring about a good understanding. I believe in the citizen soldier. The regulations which are being put forth are not in accordance with the letter of our Defence Act. In many cases they distort the Act, and are out of harmony with the feeling of Parliament. Under the present regulations it is impossible for a citizen soldier to rise to the highest position in his regiment. Men have said to me that they had only five months to serve to earn their long-service medal.. Others had a year or two 3’ears to serve.. To earn this medal is the dearest thing in life to some men who are keen on soldiering. But they were prepared to deny themselves the opportunity of earning this honour in order to resent what they regarded as unjust treatment. When that occurs, we know that there is something wrong. Trouble is bound to arise when such a spirit exists as is indicated in the report of one of these officers, who says, “ The Australian Garrison Artillery can never compare with us !”
– There is no such statement in the report I read.
– If there is, it is a statement that ought not to be made by any officer. 1
– I cannot find it just now, but it is there, almost in the very words that I have used. I will show it to the Minister afterwards. I consider that if I did not raise my voice in the interests of these men, I should be to blameI do not care who is Minister of Defence, or what Government is in office; if I had to give a vote against this Government for oppressing the citizen soldiery, I would do so, and not be frightened about it. It has to be remembered that I have approached the Prime Minister on this matter, and asked for his assistance. I pointed out to him the trouble that was arising. But I got no sympathy ; and because I raise my voice on the floor of the Senate, the Minister says that I have personal feeling against him. I have no such feeling. But I regret the feeling of caste that is arising in connexion with the Military Forces, and I say that if the military authorities will not grapple with it Parliament must, or there will be serious trouble in future. All that I ask for now is a full and impartial inquiry. I want the citizen officer to be heard in his own defence. The report read by the Minister was inaccurate and misleading. I do not say that the Minister himself was inaccurate, but that the report furnished to him was. It says that a certain officer commands a certain company, which he does not command. The actual commander of that company assures me that he furnished a report, and that report has not been given to us. There is something wrong about that. I heard one of the officers say that the Minister was once a private in his regiment, and that he felt proud of him, but I understand that the Minister was never a soldier in his life. These officers have no sympathy with the Minister, and will be glad to get rid of him. This military business is altogether too severe on our young Australians, and they are not going to stand it. The Australian is pushed on one side to-day in favour of some one else. He is given no opportunity to rise. The boy who is prepared to give his life for the defence of his country has no chance of rising to one of the highest positions in the Citizen Forces. In the Artillery it is impossible for an officer to rise above the rank of battery commander. That is not fair to the officers, and I raise my voice against such treatment. Let us have a full, fair, and impartial inquiry, and I will stand by all that I have said.
– Does the honorable senator wish to withdraw his motion ?
Question resolved in the negative.
Mr. F. SAVAGE.
asked the Minister representing the Minister of External Affairs, upon notice -
– Mr. F. Savage left Australia on 20th March, 1906. He took up his employment in the London office on 30th April of the sanie year. He was appointed to his present position on 1st April, 1 9 10.
Motion (by Senator Pearce) agreed to -
That leave be given to introduce a Bill for an Act to amend the Naval Agreement Act
Bill presented, and read a first time.
– I move -
That so much of Regulation 27 of the Provisional Regulations under the Commonwealth Bank Act 1911 as provides that, “but in case any person presenting a depositor’s pass-book and producing a withdrawal form purporting to bear the signature of the depositor or stating himself to be the depositor named therein shall unlawfully obtain any deposit or sum of money from the Savings Bank during the hours of business the Commonwealth Bank of Australia shall not be rsponsible for the loss so sustained by such depositor nor be liable to make good the same “ be disallowed.
The motion which I now submit explains itself, but I will briefly refer to the history of the matter. The narrative will convince honorable senators that there is a conflict between the clearly expressed intention of Parliament and regulation 27 under the Commonwealth Bank Act, to which the motion alludes. On 7th December, 191 1, the Commonwealth Bank Bill was received by the Senate from the House of Representatives. It contained the following clause, No. 48 -
Where a person fraudulently represents himself to be a depositor, and presents a depositor’s pass-book and complies with the rules of the Bank, and thereby obtains any money belonging to the depositor deposited with the Bank by way of Savings Bank deposit, the Bank shall not be responsible for the loss sustained.
That clause was debated at length. The result was that the Bill was amended by the omission of the clause.
The Bill, as amended, was agreed to by the House of Representatives, and, in that form, became an Act of this Parliament. So far as this Parliament had legislated upon the matter the bank was not relieved of its responsibility under the circumstances indicated in the clause which appeared in the Bill when it came up to the Senate. The intention of Parliament clearly was that depositors should be protected against anything in the form of negligence on the part of officers of the Commonwealth Bank.
– So they are, too.
– I do not think so. It will be for the Senate to determine whether or not the intention of Parliament is carried out by the regulation I refer to. It was the intention of this Parliament to declare the law as it was laid down by the High Court, and ratified by the Privy Council, in the case of Marshall against the Colonial Bank, as applying to the Commonwealth Bank, just as it was declared to apply to private banks. It was on this line of reasoning that both Houses of this Parliament determined to make the law as it now stands in the Commonwealth Bank Act. Notwithstanding the fact that the clause to which 1 have referred was rejected by both Houses of this Parliament, and the Act passed without such a provision, the Commonwealth Bank authorities have issued a regulation, No. 27, which readb in these terms -
In case any person presenting a ‘depositor’s pass-book and producing the withdrawal form purporting to bear the signature of the depositor or stating himself to be the depositor named therein shall unlawfully obtain any deposit or sum of money from the Savings Bank during the hours of business, the Commonwealth Bank of Australia shall not be responsible for the loss so sustained by such depositor, nur be liable to make good the same.
Any one reading that regulation must see that it clearly contradicts the intention of this Parliament in rejecting the clause to which I have referred, and which was in the Commonwealth Bank Bill when it came up to the Senate. I have read the clause which we rejected, and to the omission of which the House of Representatives agreed, and 1 ask honorable senators to compare it with the regulation now submitted to us.
– It means just the same thing.
– Of course it does ; and I should be inclined to submit that, as a matter of law also, it means just the same thing. If that clause had been included in the Act the law as between the Commonwealth Bank and its depositors would have been materially altered from the law as between a private bank and its customers.
– I think so, but I expected the interjection from my honorable friend. Apart from the differences of legal opinion, let us consider the substance of the matter decided by Parliament. The regulation provides that -
In case any person presenting a depositor’s pass-book and producing a withdrawal form purporting to bear the signature of the depositor -
It will be clear to honorable senators that the withdrawal form corresponds with a cheque upon a private bank. Just as a cheque bears the signature of a customer of a private bank, so the withdrawal form bears the signature of a depositor of the Commonwealth Bank. The fraudulent presentation of a withdrawal form is exactly analagous to the presentation of a forged cheque to a private bank. But under the regulation, if the authorities of the Commonwealth Bank pay on a fraudulent withdrawal form, the bank is not to be held responsible for the loss so sustained by the depositor, nor is the bank to be liable to make good the same. Honorable senators have only to analyze, not merely the substance, but the very terms of the regulation and the clause which was rejected by both Houses of this Parliament to see that the regulation is in direct conflict with the intention of Parliament in rejecting the clause. It is not merely that the Commonwealth Bank authorities are negativing the action of Parliament, which is a rather serious matter, but there is an assertion on their part of a principle directly contradictory to the banking principle asserted by this Parliament in rejecting the clause to which I have referred. I wish it to be distinctly understood that 1 have no desire to enter into the merits of the decision come to by Parliament. It is not relevant to my motion to analyze the motives which led members of both Houses to pass the Commonwealth Bank Bill in the form in which they did pass it. Notwithstanding what may have been the conflict of opinion in Parliament on the subject, the important point is that Parliament, having expressed its will by the passing of the Act, it must be respected by every authority in the land, including the authorities of the Commonwealth Bank. That is the reason why, inasmuch as it is in conflict with the intention of Parliament, I ask honorable senators to disallow the regulation submitted by the authorities of the Commonwealth Bank. I am asking the Senate to assert that nn Act of this Parliament, and its clearly expressed intention shall not be made subject to the will of any subordinate authority. In every respect the authorities of the Commonwealth Bank are subject to the provisions of the Act under which it was established. This is quite different from saying that the administration or policy of the bank shall be subject to Parliament. We have constituted a Commonwealth Bank under an Act of this Parliament, and it must be subject to that legislation. Regulations made under the Act must conform to the spirit and intention of the Act as passed by Parliament. Every lawyer is seized with the importance of uniform legislation. I have often heard it laid down that while a law may be right or wrong, one thing that is always evil and dangeious in legislation is that it should not be uniform. There is nothing more expedient than that a law should be as clear as we can make it, and should be uniform in its application. It is dearly advantageous to the whole community that the law which governs the relations between private banks and their customers should prevail as between the Commonwealth Bank and its depositors. Apart from the question of the uniformity of the law, if this regulation be not disallowed it will be remarkably difficult for any member of this Parliament or any lawyer to determine exactly what the law is as between the depositors in the Government Savings Bank and the Savings Bank itself. I admit that when we were framing the Bills of Exchange Act, every member of both Houses of this Parliament was thrown back upon the decision which had been given by the High Court in the case of Marshall v. the Colonial Bank. After the fullest investigation we arrived at the conclusion that, although that decision was a negative one-
– That case had reference to a cheque. It had nothing to do with the Savings Bank.
– That is so. That decision was a negative one. It simply affirmed that because a customer in drawing a cheque had afforded facilities for fraud to be committed on the bank, the bank was not entitled to debit the customer’s account. When we were dis cussing the Bills of Exchange Bill we declined to allow private banks, tp be relieved of their liability in that connexion. Since then we refused to relieve the Commonwealth Bank of its responsibility in cases of negligence on the part of its depositors. Why? Because if we had afforded it that special protection it would probably have led to negligence on the part of the bank officials, with the resuit that innocent depositors would suffer.
Sitting suspended front 6.30 to 8 p.m.
– The Bills of Exchange Bill was introduced into the Senate on the 23rd August, 1907, by Senator Keating, who was then Minister of Home Affairs That marked the initial stage of our legislation dealing with this particular matter. That Bill contained the following clause: - 81 (a) When a cheque drawn on a banker by a customer has been drawn by the customer with negligence, and
The debate upon that clause was prolonged, but ultimately it was agreed to, and the Bill was transmitted to the House of Representatives. Subsequently that branch of the Legislature excised every, one of those provisions. The Bill was returned to the Senate, and some time in 1907 it became law with those provisions expressly eliminated. So that upon two occasions this Parliament has distinctly refused to interfere by legislation with the effect of the decision of the High Court in the case of Marshall v. the Colonial Bank - a decision which was subsequently confirmed by the Privy Council. Yet we now find that a regulation has been made which distinctly affirms that which both branches of this Parliament have declined to concede. In answer to an inquiry as to the authority under which this regulation was framed, I was referred to section 63 of the Commonwealth Bank Act. But on turning to that section I find that it merely empowers the Government to make regulations not inconsistent with the provisions of the Act.
Vet it must be clear to all that this particular regulation is entirely inconsistent with, and contrary to, the expressed intention of both Houses of this Parliament. It will be observed that I have put entirely upon one side the question of . what were the opinions expressed by honorable senators, as recorded in Hansard, in regard to the advisableness of framing this regulation. I have not discussed the question of whether . it is in harmony with the policy of the Government. I have brushed aside these considerations, because I recognise that, after all, we must come back to the essentia] question - a question which has been frequently discussed here - of the danger of legislating by regulation, especially when that legislation is upon its very face in direct conflict with our expressed intention. I sub- emit that the point which we have now to impartially consider is whether this regulation does or does not conflict with the legislation which wehave already enacted. It must be remembered that in the matter of the Commonwealth Bank, and whatever regulations it may make, this Parliament has exclusive jurisdiction. The way in which it shall be conducted is exclusively within our control. It is not a matter in which we need to consider, as between ourselves and the States, our relations to one another under the Constitution. Nothing can interfere, so to speak, between us and our legislation. Therefore, we have now to consider whether, in view of the history I have narrated, this regulation made ‘by the bank is in direct or indirect conflict with, the express terms of our legislation. It is thought by some critics to go too far, and it is certainly in conflict with the expressed intention of both Houses as embodied in the Commonwealth Bank Act. For these reasons . I beg to submit the motion.
– I have no doubt that Senator St. Ledger is perfectly honest in the action which he has taken.
– Naturally, ashe sits on this side of the Chamber.
– Honorable senators opposite are very honest, but misguided to a very considerable extent. Our legistion embraced the establishment of a Commonwealth Bank, not only for general purposes, but also for savings bank purposes. I can remember the discussion on the clause referred to by Senator St.
Ledger, and the source from which the opposition to it came. It was Senator Walker, one of the greatest banking authorities that we have in the Commonwealth Parliament, who raised the first objection, and moved the rejection of the clause. No doubt he was just as honest as are Senator St. Ledger and Senator Millen, or any other senator on the other side. But every one of the honorable senators there opposed the establishment of a Commonwealth Bank by parliamentary sanction.
– That is not the question now.
– We shall see in a few minutes what the question is now. Honorable senators on the other side, not only opposed the establishment of a Commonwealth Bank for general purposes, but offered the bitterest opposition to the creation of a Commonwealth Savings Bank.
– We had some support from your side in opposing that clause.
– Yes, I am sure that honorable senators on the other side are always delighted when they can hoodwink or mislead any one on this side.
– They were easily hoodwinked.
– I would have liked those on this side who were deceived by the sophistries from the other side to have been- present when Senator Sayers. interjected that they were easily hoodwinked.
– You used the term “ hoodwink.”
– I remember the objections raised to clause 48 being embodied in an Act of Parliament. When it was’ interjected that the provision was in force by regulation in Victoria, it was slated on the other side that a regulation was a different thing from a provision in an Act of Parliament. That was an assumption on the part of some honorable senators on that side, that although there was a serious objection to placing the provision in the Act itself, yet that objection was not so strong if the provision was to be brought into force by regulation.
-Colonel Sir Albert Gould. - I do not think that the honorable senator can quote a single word in Hansard to bear him out.
– I can give the page in which it appears, and the gentleman who uttered the expression I have referred to was Senator Vardon.
-Colonel Sir Albert Gould. - What did he say ?
– I am not a fool ; I do not forget in a minute what has been impressed on my mind by days and weeks of discussion. I came to the conclusion, and have held that view ever since, that honorable senators could not so strongly object to a regulation as they did object to a provision of the kind in an Act of Parliament. We had precedent for placing a provision of this kind in the Act, because it is to be found in the Western Australian Savings Bank Act. It is the subject-matter of a regulation in Victoria.
-Colonel Sir Albert Gould. - So we were told at the time; we knew all that.
– It is just as well to remind honorable senators of these things. I may remind them of a number of other things before I have finished. I can also recollect that, when the provision was under discussion, the great anxiety on the other side was for the poor depositor and the poor servant girl. It was by these sophistries that they induced one or two senators on this side to go over and support them. They cannot deny that.
– Senators Gardiner and Rae were the two strongest opponents of the clause.
– And the first speakers against it.
– They have been the strongest opponents of a good many other things, but does Senator Sayers meanto suggest that they were right every time in their opposition?
– They were right that time.
– Of course, they were right, because they agreed with the honorable senator, and that is the only time that anybody on this side can be right.
-Colonel Sir Albert Gould. - Senator O’Keefe opposed the clause too.
– The strongest claim which was then made by honorable senators on the other side was that the Governor of the Commonwealth Bank should not be subject to political influence. The Governor has taken up his position. He examined the Commonwealth Bank Act, and no doubt the legislation with respect to Savings Banks in the States, and he came to the conclusion that it was advisable to place the Commonwealth Savings Bank on the same footing as the State Savings
Banks. That was a wise conclusion so far as the Governor of the Bank is concerned.
– If you do not have this regulation the Commonwealth Savings Bank will have a handicap in its favour as against the Savings Banks of the States.
– I thank the honorable senator for the suggestion that the Commonwealth Savings Bank would be in an advantageous position ; but I would point out that honorable senators opposite are not moving now for that purpose. They have never shown a friendly desire to put either the Commonwealth Bank or its Savings Bank branch in a favorable position anywhere. The present action is taken for exactly the same purpose. The Governor of the Commonwealth Bank has been appointed. Every honorable senator here, with the exception of Senator Millen - and I believe that even he would qualify his statement - knows that the Governor is an able man.
– Who said that he was not? Will it not be time for the honorable senator to say that he is an able man when somebody says that he is not?
- Senator Millen raised an objection to the appointment of this gentleman when he was speaking on the Address-in-Reply, and I want to know if he is going to qualify that statement to any extent. Honorable senators opposite do not need to fly off at a tangent when I make a statement of that kind. I am not speaking from hearsay, because I was present when Senator Millen spoke. I heard the reference he made to the Governor, and it was not a creditable one. There are few men either in politics or outside who are not prepared to admit that the Commonwealth Government were very fortunate in obtaining the services of such a man.
– On this motion I have not said a word on that point.
– I have a great many words to say in thatdirection, because it always leads up to something. When the Commonwealth Bank Act was under discussion, honorable senators opposite objected to the Governor of the Bank being subject to political influence. This officer, after examining the conditions under which every State Savings Bank worked, came to the conclusion that it was necessary to make a. regulation for the purpose of protecting the Commonwealth Savings Bank. No sooner is his recommendation given effect to by the Executive than an attempt is made to use the most powerful political influence which could be used.
-Colonel Sir Albert Gould. - This motion is provided for by the Act itself.
– Honorable senators will not find one word in the Act to prevent a regulation of this kind being made. When the Bill which is now an Act was before the Commonwealth Parliament, clause 48 was struck out. But clause 63 was allowed to remain, and therefore the Governor of the Bank was not deprived of power to make regulations.
– The Senate said that it did not approve of that proposal.
– If the Senate does not approve of the regulation, it goes by the board. But the Governor of the Bank had a right to recommend the regulation, and the Executive had a right to pass it.
– We have a right to disallow it.
– No one denies that. If the honorable senator can induce the Senate to disallow the regulation, we have power to do so. I wish to say a word or two as to what the effect of rejecting the regulation will be. In every State of the Commonwealth the Savings Banks are protected either by Act or by regulation, and no fraud can be perpetrated such as would be possible if this regulation were disallowed.
-Colonel Sir Albert Gould. - Only two States have such a provision.
– Is the honorable senator certain?
-Colonel Sir Albertgould. - Only two States were mentioned in the foinser debate.
– The honorable senator has to show that a similar regulation does not exist in the other States. If the regulation were disallowed, there would be no necessity for criminals to run the risk incurred by committing burglary or picking pockets. They need only exercise their ingenuity by defrauding the Commonwealth Savings Bank, and the detective force would not have a chance of finding them out. Suppose I deposited £100 in the Adelaide branch of the Commonwealth Savings Bank. Suppose I then went to Senator St. Ledger, and said to him, “ Here is my order on the Bank for£100, and here is my book. You can collect the money, place the book where I can find it, and then we will see what happens.” Senator St. Ledger would take my book and my order, and go to the Bank. The Bank would cash the order. In a week or a month afterwards, I could go to the Bank with another order for£100.
– If the honorable senator did that, the police would put him in gaol for ten years.
– How could they find me out? They could not catch me if I declared that the first signature was a forgery. Who could prove that it was not? They would have to catch Senator St. Ledger, and if he were a wise man, he would have cleared out.
-Colonel Sir Albert Gould. -Afterthe honorable senator had given his signature on the first order, it would be a crime to sign a second one.
– I could swear I never signed the first one.
-Colonel Sir Albert Gould. - That would be two crimes.
– It would be safer than burglary, because it could never be detected.
– Has the honorable senator tried burglary?
– I have tried many things in my time ; I have even tried politics ! I am pointing out the simplicity and ease with which collusion could be arranged, and fraud perpetrated without the possibility of detection.
– The honorable senator does not consider the wrong done to a depositor who is defrauded of his money.
– No wrong is done. If honorable senators will look carefully into this matter, they will recognise the great difference between the customer of an ordinary commercial bank and a depositor in the Savings Bank.
– There is no difference in regard to current accounts.
SenatorMcGREGOR.- Is there not? The honorable senator makes statements without consideration. I wish he would think before he speaks. Then he would not make such gross mistakes. Let me show the difference. A man who has a current account with an ordinary bank can sign his cheque, send it to the bank, and get it cashed. But a depositor in a Savings Bank must produce not only his order, but his book.
– So must the man with the current account in some cases.
– Need I take notice of such an inaccurate statement as that ? Every one present knows that such is not the case. A person with a current account at a bank can, by presenting a cheque, get his money at once without producing any book but in a savings bank it is imperative that the book as well as the order shall be produced. The depositor in a savings bank is protected by the possession of that book. Unless he carelessly or fraudulently parts with it he is absolutely safe. If a depositor is careless with his book, and allows any one else to get possession of it, so as to enable a fraud to be committed on the bank, whether he is acting in collusion with the other person or not, it is only right that he should suffer. Every right-thinking man or woman will agree with that.
– But suppose that a burglar broke into a depositor’s house and took his passbook?
– Then he would have to give notice to the bank that his book had been stolen.
– He might not. discover the loss for twelve months.
– Such a person would be like a duchess who leaves £50,006 worth of jewellery lying around for any one to pick up. There is not a depositor in a savings bank but knows that he has to be careful with his bankbook. A person who carelessly omits to keep his book safely, and permits a fraud to be perpetrated on a bank ought not to expect the bank to be responsible for his carelessness.
– Was not that the argument in Marshall’s case?
– That case related to carelessness on the part of the drawer of a cheque.
– It was not a savings bank case.
– No ; it was a case in which an ordinary bank ought to have taken greater precautions. The possession of the bank-book is the greatest protection that a savings bank depositor has, and he knows that he ought not to allow it to get into the hands of any other person. But I wish it to be clearly understood that if a poor servant girl, or a work man’s wife, did carelessly or negligently lose possession of a bank-book, and was robbed of a few pounds, the bank, if the person went and made a clear statement, and showed that there was no collusion, but that the loss was due to unfortunate circumstances, would not be prevented by this regulation, or by our legislation, from taking the case into consideration, and bearing the loss.
– Is the honorable senator suggesting favoritism? Does he mean to say that the bank will stand the loss in one. case and not in another ?
– There is no provision in the Act to enable the bank to do that.
– There is nothing to prevent the bank from doing so as an act of grace.
– That would be assuming an obligation for which the bank was not liable.
– I am merely saying that there is nothing in the Act or regulations to prevent the bank acting as I have described. The Governor has absolute control.
-Colonel Sir Albert Gould. - Subject to the law.
– There is no law to prevent him giving away the money of the bank in the circumstances I have indicated. The Governor and the authorities of the bank, and the present Government at the back of it, would not be likely to raise any serious objection in a case of real hardship, to making some allowance to an unfortunate man or woman whose money was fraudulently obtained.
– The Governor of the bank is a trustee for every depositor.
– He has absolute “authority, and there is nothing in the law to prevent him from taking such cases of hardship into consideration.
– There is nothing in the Act to compel him to take them into consideration.
– No; and it would be very unwise to have any such provision in the Act, because, as I have already said, it is right that carelessness and negligence on the part of a depositor should be punished in some way-
– What about the negligence of the bank?
– I do not see how there could arise any negligence on the part of the bank in connexion with the question we are now discussing. I may tell honorable senators what might happen. There might be a dishonest officer of the bank, and a dishonest depositor, and there might be collusion between them which would result in the bank being robbed. In such a case the regulation now objected to would prevent the dishonest depositor coming again to the bank and claiming the amount which, by his dishonest and guilty connivance with the dishonest officer of the bank, had already been collected.
– That collusion might take place outside the bank.
– If the honorable senator had been present, he would know that I have already alluded to dishonest collusion outside the bank. Of what use is it to submit arguments if honorable senators are prepared to join with the opponents of the bank without listening to those arguments? I am appealing to those who have at heart the best interests of the legislation we have passed. I appeal to those who have struggled for years for the establishment of a Commonwealth Bank, and the Savings Bank branch attached to it. Honorable senators opposite who are prepared to do everything they can to defeat our legislation, and to make it a failure when they have not been able to prevent it being passed, now look for the support of honorable senators on this side because they raise a few objections which really have no substance whatever in them. The Commonwealth Savings Bank will probably for many years have to compete with the State institutions, and if we were to permit the State Savings Banks to occupy a more favorable position in the minds of the public, we should jeopardize the success of the institution which we have done so much to bring into existence the Governor of the Commonwealth Bank has recommended this regulation, and the Government have accepted it in the interests of the proper carrying on of the affairs of the bank. No man can know more’ about the competition he will have to engage in than the Governor of the bank himself. There is nothing in the Act to prevent the issue of this regulation, although, through the influence of honorable senators opposite, the Senate would not permit a clause which would have had the same effect to be included in the Act. This regulation is proposed in the interests, and to insure the success, of the bank, to prevent collusion between people outside or between dishonest depositors and dishonest offi cers of the bank. Another thing which should be pointed out in connexion with the establishment of the Commonwealth Savings Bank is that, while in all the commercial banks there are highly-trained staffs of officers, who are always on the alert, and whose sole business it is to look after the interests of the banks in which they are employed, the Governor of the Commonwealth Bank has to take into his service persons who are servants of the Commonwealth for quite other purposes. We cannot expect every postmaster and postmistress to be a banking expert, and when the matter is considered from that point of view, it is. clear that it is absolutely necessary that the Commonwealth Savings Bank shall have greater protection than is necessary in the case of an ordinary commercial bank. That protection will be afforded by the regulation which is now objected to. I hope that honorable senators will consider the regulations from all these points of view, and, in the interests of the utility and success of the Commonwealth Savings Bank, will be prepared to sanction this regulation, which the Act permits under section 63.
SenatorO’KEEFE- (Tasmania) [8.50]. - We have listened to a very instructive and vigorous defence of this regulation from the Vice-President of the Executive Council. At the outset I desire to give the fullest credit to the Government and the authorities of the Commonwealth Savings Bank for the best intentions in issuing this regulation. But, in his defence of it, the Vice-President of the Executive Council has lost sight of the most important feature connected with it. The question is raised as to whether an official, who is the creation of this Government and this Parliament, should have greater power than the authorities who created him. I look at the matter as I. should do, no matter what Government was in power. One branch of the Legislature deliberately rejected a certain clause after a full discussion, commencing at 2 a.m. and closing about breakfast time. Many honorable senators must have a vivid recollection of the sitting of the Senate to which I refer.
– The honorable senator is being cheered by the opponents of the bank.
– I do not want that sort of gibe from the Vice-President of the Executive Council.
– The honorable senator will always get it.
– I do not think that the Minister is treating loyal supporters of the bank fairly when he gibes at them in that way.
– May not the question be decided on its merits?
– It does not matter to me whether I am cheered by the other side or not. If Parliament made a mistake in rejecting clause 48 of the Commonwealth Bank Bill as originally introduced, there was obviously a proper course to follow to remedy that mistake. If the Government had brought down an amending Bill containing only the clause which has been referred to, and had been able to show that we made a mistake in rejecting that clause last session, I, as one who yields to no one else in his desire to see the Commonwealth Bank a success, would have been prepared to consider it, and any additional arguments’ submitted by the Government in support of it. The’ Senate deliberately rejected a clause which Ministers last session thought necessary to safeguard the bank. The Bill was returned to another branch of the Legislature with that clause deleted. In that other branch of the Legislature there were several loyal supporters of the bank and of the Government, and there was, no doubt, a solid phalanx of members of the Opposition who, when Ministers asked them to restore the clause to the Bill, refused to do so, and it became an Act without that clause. There could be no clearer case of deliberate flouting of the will of Parliament by an official than is before us in the regulation now under consideration. I am satisfied that the Governor of the bank believes that he is doing the” right thing in issuing this regulation. I am willing to yield to his superior knowledge of banking, and admit that he may have proposed what is right. I should have been prepared, after listening to the arguments which were put forward so strongly to-night by the Vice-President of the Executive Council to vote in a different direction to what I did last year, if an amending Bill had been brought down containing the rejected clause. But what I most object to is that the deliberately expressed will of both Houses of Parliament should be flouted, no matter what the political convictions of the Government may be. An official who is the creation of Ministers has submitted a regulation, in which he practically says to Parliament, “ You made a mistake. I have more power than you have, though you created me. I do not give a snap of my finger^ for your Parliament; I shall do as I like.”
– All he says is that we should reconsider our position.
– There is a candid admission in proof of my statement. I say that this is not the right way for an official to approach Parliament, and suggest that it has made a mistake.
– That is not even what he does say.
– The right way in which to reconsider the position is to pass an amending Bill. Clause 48 of the Commonwealth Bank Bill, as originally introduced, provided that -
Where a person fraudulently represents himself to be a depositor and presents the depositor’s pass-book and complies with the rules of the Bank and thereby obtains any money belonging to the depositor deposited with the Bank by way of Savings Bank deposit, the Bank shall not be responsible for the loss sustained.
After discussing that clause from 2 a.m. until breakfast time, the Senate rejected it.
– By what vote - twelve to twelve?
– By what is known in the Senate as the negative vote. . I draw attention to the “ fact that one honorable senator who, at the opening of the debate, spoke as strongly as any other against the clause, voted for it on the division.
– That is not correct. The Hansard report shows twelve on either side ; but if the honorable senator will look down the list of senators, he will find that there are eleven on one side and thirteen on the other.
– Then I am to take it that Senator Gardiner, who made a very brief but exceedingly vigorous speech against the proposal, voted with the “ Noes.” Evidently an injustice has been done to him, inasmuch as his name is recorded in the wrong list. He is represented as having voted with the “Ayes,” when, as a matter of fact, he voted with the “ Noes.” The division was a very close one, and, as the voting was equal, the motion was negatived. But if we made a mistake on that occasion- and I am free to admit that strong arguments have been adduced by the Vice-President of the Executive Council to show that we did - there was a proper way of remedying it, instead of admitting that in the matter of legislation this Parliament is inferior to an official. When we deliberately say that we shall have a certain clause in a Bill, and a public official afterwards says, “ You shall not have it”-
– That is not a fair way of putting it. The experience of the Governor of the bank has shown him the unwisdom of it.
– That officer thinks we made a mistake, and Ministers think so, too. Probably we did. But unless we are going to allow the will of Parliament to be subordinated to that of an officer outside of it, we cannot proceed in this way. If ever there was a case of legislation by regulation this is one.
– It is legislation by regulation run riot.
– I confess that the Vice-President of the Executive Council has shown us that the Commonwealth Bank will be placed upon a somewhat different footing from the State Savings Banks if this regulation be disallowed. At the same time, it places us in the very peculiar position of playing second fiddle to an official. That official has stepped in and said to Parliament, “You made a mistake. I am going to rectify it.”
– He does not say that ; the regulation is before the Senate now.
– With all his legal acumen, how can the honorable senator take any view other than that which I have put?
– To say that the Governor of the Commonwealth Bank is placing Parliament in an inferior position is absurd.
– The honorable senator heard me read the clause which was contained in the original Bill. I think he was one of those who were fortunate enough to be sleeping on the night that the provision was discussed here. This regulation is practically identical in its wording, and certainly in its scope and meaning, with the clause which was contained in the original Bill. It has been put into effect, and until it is disallowed it will remain the law of the land. The Commonwealth Savings Bank is already open, and the regulation is now in existence. Until it is disallowed it will continue the law of this country, notwithstanding that it is an express contradiction of what this Parliament declared the law should be. I think that the Senate ought to hesitate before it accepts legislation by regulation when it proceeds to that extreme. I admit that stronger arguments have been brought forward to-night by the Vice-President of the Executive Council than were adduced on the previous occasion when this matter was under consideration. Had such arguments been advanced in support of an amending Bill which was designed to restore to the Act the provision which it originally contained, I should have been prepared to support it. I aim a loyal supporter of the Commonwealth Bank, and I do not like to be told that I am supporting members of the Opposition who are opposed to that institution. I find that when the question was put, “ That the clause stand as printed,” the division resulted in twelve “ Ayes “ and twelve “ Noes,” consequently the question was resolved in the negative. The “Ayes” were - Senators Barker, Buzacott, Long, Lynch, McDougall, McGregor, Needham, Ready, E. J. Russell, Stewart, Turley, and de Largie, all loyal supporters of the Commonwealth Bank, both in principle and detail. The “ Noes “ were - Senators Blakey, Givens, Gould, Keating, McColl, O’Keefe, Rae, Sayers, Vardon, Walker, St. Ledger, and, I understand, Senator Gardiner. It will be seen that five supporters of the Government voted for the deletion of that clause. It would be just as well, in a discussion of this sort, if the Vice-President of the Executive Council abstained from gibing at Government supporters. If he thinks that this regulation is necessary for the safe conduct of the business of the Commonwealth Bank, I hope that he will bring down an amending Bill, empowering the Government to issue it. If he does so, he may rely upon one vote which he will not have to-night.
Senator Sir JOSIAH SYMON (South Australia) [9.4]. - As Senator O’Keefe has observed, I was not present on the occasion alluded to by Senator St. Ledger, and I may also say that I am no friend of the Commonwealth Bank. I opposed its creation on every occasion that 1 possibly could, both here and on the platform in my own State. If there was one part of that legislation to which I was more strongly opposed than another, it was that part which provided for the inauguration of a Commonwealth Savings Bank. I opposed it because I thought it was entirely superfluous to the safeguarding of the savings of the thrifty people of this country, and because there was already established in every State a Savings Bank system which, I believe, is extremely efficacious, and is for the advantage of the community. But I did interject when the Vice-President of the Executive. Council, was speaking that it would be advantageous to the Commonwealth
Bank to carry Senator St. Ledger’s motion, and to disallow the regulation to which he takes exception. I know of three States in which this regulation is operative, and in those States its disallowance would mean hoisting a flag to announce that, while unfortunate depositors who were robbed by unscrupulous persons could not recover from the States Savings Banks they could recover from the Commonwealth Savings Bank. There could not be a better advertisement for the Commonwealth Bank than the disallowance of the regulation.
– Does not the honorable senator think that the fear of punishment would act as a deterrent to those who were inclined to offend ?
– We know to what extent the fear of punishment acts as a deterrent to persons who are disposed to commit perjury. The fear of consequences will not prevent fraudulent and dishonest individuals from seeking to secure the property of their fellows.
– Every criminal thinks that he can beat the law.
– Exactly. If I were a friend of the Commonwealth Savings Bank, which I am not, and if other considerations did not convince me of the propriety of this regulation, I should be found supporting Senator St. Ledger, so as to give a fresh advertisement to the Commonwealth Bank in its competition with the Savings Banks of the States. ButI view it from the stand-point of a citizen who finds on our statute-book a piece of legislation establishing an institution to which I am entirely opposed. It is, however, the law of the land, and it is my duty to see that that institution, now that it has been established, has no impediment placed in the way of its successful administration, and that in the conduct of its business it is put upon an equality with the institutions with which it has to compete. That is the stand-point from which I approach the consideration of this question of whether the regulation which has been framed is a proper one as affecting the conduct of the business of the bank and its relations with its customers.
– Does not the regulation affirm a principle which this Parliament refused to sanction?
– My honorable friend must not be impatient. I do not view this matter from a party stand-point. The creation of a Commonwealth Bank was one of the highest party questions with which we have ever had to deal, and associated with it was the propriety of establishing a Commonwealth Savings Bank. In my opinion it was misconceived and utterly wrong, but there it’ is. I think that Senator O’Keefe istaking an erroneous view of this position. We as a Senate ought not to be influenced by such a proposition as heput to us - “ Is an official created by Parliament to have more power than Parliament itself?” Surely that is not thequestion which is going to decide this matter ! . My honorable friend said also that it proposes to make Parliament inferior to an official of its own creation.
– I ask my honorable friend or any other honorable, senator : Is he going to vote on this motion) because he thinks that the regulation is an attempt of an arbitrary official to place Parliament under his hoof? Why, the thing is ludicrous.
– No; he is going to vote on the motion because it is a question of government by regulation.
– That is another thing It was not worthy of my honorable friend to introduce the argument. I do not know the Governor of the Commonwealth Bank, and never heard of him until he was appointed, but I should require something very much stronger than the presentation of these rules to Parliament before I should come to the conclusion that he was setting it at defiance, or as my honorable friend said,. “ flouting the will of Parliament.”
– Is not the regulationin question diametrically opposed to the will of this Parliament?
– In my view it is not. But whether it is or is not, surely we are not to reject the regulation because it was made on the recommendation of the Governor of the Commonwealth Bank. If it is a proper provision this was the right way to make it. It is the Government who are responsible, If they have done a wrong thing, surely we are not going to let them ride off on the shoulders of, or shield themselves behind, the Governor of the Bank.
– Where shall we get finality if Parliament says one day that it will not do a thing, and the next day the Government does the thing?
– Let my honorable friend turn the Government out.
– That is evading the question.
– It is mot. What I am dealing with now is my honorable friend’s appeal - “ Is the will of Parliament to be flouted by a Government official?” Surely that is not the question with which we have to deal now. My honorable friend says now that if this provision were brought down in a Bill he would vote for it. Why will he not vote for it when it is contained in a regulation? Let me tell him in all humility that, in my opinion, a regulation is the proper way in which to make the provision. In my opinion it is not a provision which ought to go into a Statute. It is embodied in a regulation, because it is a matter of contract between the depositor arid the bank which receives his money.
– The unfortunate thing is that the Government attempted to ,make the provision Statute-law.
– I know that. If Senator O’Keefe will Sup.port the provision in a Bill, I think he ought to support it in a regulation. That is the convenient place for the provision to be made.
– That was not the opinion of the Government when they put the provision in the Bill.
– Probably the Government found that they were mistaken. The Act says -
The Governor-General may make regulations, mot inconsistent with this. Act, prescribing all matters which are required or permitted to be [prescribed or which are necessary or convenient ito be prescribed for carrying out or giving effect to this Act, and in particular for making provision for the issue, inscription, transfer, transmission - and so on.
-Colonel Sir Albert Gould. - And redemption of inscribed stock of the Bank.”
– That is another matter ; it has nothing whatever ito do with the depositor.
– If the Senate turns -down this regulation to-night, will the honorable senator say that the Government would be justified in introducing it to- morrow ?
– I do mot see why they should not. Is not that done every day? A Bill was rejected last session, and is brought in this session.
-Colonel Sir Albert Gould. - Not in the same session.
– There is nothing but a standing order to prevent that. Is not this thing done every day - a clause is negatived here ; the other House on consideration thinks that it ought to be passed, and puts it in; the Bill comes back, and we reconsider the clause and agree to it.
-Colonel Sir Albert Gould. - That is all one transaction.
– So is this all one transaction.
-Colonel Sir Albert Gould. - Two Houses have determined this matter.
– No. I really do not understand the position that is taken that there is some barrier. Is it said that what was done last year by eliminating the clause from the Bill prevents this regulation from being made?
– You deliberately will not understand. This provision is now in operation against the expressed will of Parliament.
– It is not in operation against any express Act of Parliament.
– Against the vote of a majority of both Chambers.
– Not at all ; they took the provision out of the Bill. If they had put in the Bill that the Commonwealth was always to be responsible, and given an affirmative expression of their opinion, the clause would not have been negatived, assuming that the voting had been the same. Senator St. Ledger used the expression that the regulation is against “ the expressed intention of Parliament.”
– So it is.
Senator Sir JOSIAH SYMON.Where? My honorable friend knows enough of procedure to know that Parliament can only express its intention by an Act or by a joint resolution.
– It expressed its intention by knocking out the clause.
– Parliament eliminated the clause from the Bill.
– What was the effect of the elimination - to leave the bank responsible ?
– No ; it left the matter to be dealt with by regulation. Is there anything in the Act to prevent the Governor- General from making the regulation? Nothing. Of course, if there had been, that would have ended the matter. If there had been a permanent enactment that the bank should become a guarantor in every case of the negligent loss of a pass-book-
– The striking out of the clause was equal to that affirmation.
– When my honorable friend has slept over the matter he will tell me to-morrow that he was quite wrong in expressing that view. The elimination of the clause was an expression of opinion for the moment in the Senate that it should not appear in the Bill.
– That the bank should not avoid its responsibility.
– No. Senator O’Keefe says that he would vote for the provision if it were in a Bill.
– No; I said that if the Minister brought down a Bill and used arguments as strong as those which he used to-night, I probably would be found voting with him.
– Oh, no. That is the most delicious and casuistic way of phrasing it that I have ever heard. I shall come to my honorable friend when I want a lesson of that sort. It is very prosaic when we come to look at the matter. I do not agree with what Senator Millen said, but I do agree that every honorable senator who voted with the “ Noes “ expressed his opinion, and even if they all agreed that they would not have a provision that the bank be held responsible, that was their view. The other twelve senators voted according to the other view. That is all that it comes to. The clause was not in the Bill when it became an Act. The regulation is a notice to all those who are doing business with the bank that one of the terms on which business is done is that if they, by their negligence in relation to a pass-book, enable some one to defraud them through the bank, it shall not be responsible, and they agree to the condition. Take an ordinary bank. A savings bank is not an ordinary bank; it is not a bank in the ordinary signification of the term. All the usages which apply to ordinary banks do not apply to savings banks. But suppose that there is a resemblance ; it is only to this extent : that if some one forges my name to a cheque, and my banker cashes it, the bank has topay, simply because, as the Chief Justice, pointed out in the case of Marshall v. the Colonial Bank, the bank has a great, body of experts who are accustomed to handwriting and so on; and it is more reasonable that the responsibility for not detecting a forgery should rest on the officials of the bank than on the customer who is defrauded. So in every case where a forged cheque is paid the bank is responsible, but with this qualification, that if the fraud has been committed in consequence of some want of care on the part of the drawer of the cheque, leaving, for instance, a space for an extra figure to be put in, the bank is excused. The principle is that if a fraud has been brought about, and the carelessness of the customer in drawing his cheque has facilitated the forgery, the bank is excused. Of course, the application of the principle varies according to each case ; but in the case of the Savings Bank, the situation is entirely different.
– Should not the Savings Bank officials be just as much experts in handwriting as the officials of private banks ?
– You donot expect the same skill in detecting handwriting at the branches of the Savings Bank scattered throughout the country as you doat a head office. But that really is not the ground of the regulation. The Savings Bank is in an entirely different position from an ordinary bank. Here there is no question of a forged cheque being presented. The essential part of the operations of the Savings Bank is the production of the pass-book. That differentiates its. processes altogether from those of an ordinary bank. Your cheque upon an ordinary bank may circulate all over the country - it may pass through fifty hands before it reaches the bank.
– The effect is the same if a person loses his money by fraud.
– But every Savings Bank provides that the account of a customer shall not be operated upon unless the pass-book is produced- That is an essential safeguard. We must not look at this merely from the position of the poor servant girl.
– No sentiment.
– Sentiment has nothing to do with it at all. An essential in connexion with all Savings Bank business is to impress upon the depositors the necessity of absolute vigilance and supreme care in relation to the custody and preservation of the pass-book.
– Cannot that be imipressed upon the officials of the bank ?
– It is not the officials of the bank who are likely to be careless about the pass-book. It is the customer.
– Why throw the obligation upon him?
– Because it is the customer who has the pass- book.
– But the bank has the money, and ought to be careful.
– It is not a fraudulent signature that has to be provided against in this case. The customer is expected to take the greatest care of his pass-book, and the simple effect of this regulation is to say that if a customer is so careless that when he loses his passbook he does not give notice to the bank, that carelessness shall disentitle him- to recover his money.
– They ought to provide every depositor with a Chubb safe.
– Has the honorable senator seen all these regulations?
– I have read them all.
– Then the honorable senator is ahead of me. I have not read them all, but I have read those which are associated with the regulation under discussion. I invite the atten tion of the Senate to them because they are illuminating. The first one is regulation 23, which makes it imperative that there shall be a bank pass-book, and that -
In all transactions which a depositor may subsequently have with the Savings Bank, whether depositing, withdrawing, or closing the account, the pass-book must be produced.
That is entirely different from the operations of an ordinary bank.
– It is different, but can the honorable senator justify it?
– Certainly ; because the Savings Bank is in a totally different position. The pass-book is the customer’s title-deed. The regulation impresses upon him the necessity of taking care of it. ft impresses upon him - rightly, I think - the duty of reporting the fact if it disappears. If it disappears through his carelessness, and he does not give notice to the bank, why should the bank indemnify him against loss arising from a care lessness against which he is warned by every one of these regulations?
– The honorable senator would punish carelessness more than crime.
– It is simply a question of who is responsible for the loss. I do not want to use the word “punish,” but who is responsible? It is not the bank that is careless about the loss of the book. The bank may have been careless in passing the forged signature.
– The honorable senator seeks to relieve the bank of any responsibility.
– How can the honorable senator say that?
– Because, under these regulations, the bank can be as careless as it likes.
– In what way?
– It can pay the first man who presents himself with a passbook which may have been obtained by fraud.
– If the person from whom the book was obtained by fraud did not report the fact that he had lost it, why is the Commonwealth Bank to suffer the loss?
– The bank must have the depositor’s signature as well as the book before it will pay.
– Of course it must. What are all these regulations for? The depositor has staring himi in the face the fact that the pass-book is his title-deed. It is this which enables him to withdraw money, or to pay money in. H’e cannot do the one or the other without it. The regulation proceeds -
Depositors are requested to examine their passbooks every time an entry is made by a Savings Bank officer, and before leaving the counter.
You do not do that in an ordinary bank. All that an ordinary banker does is to keep the account of its customer, and the passbook is a copy of the banker’s account. It is a kind of “ account rendered.”
– An ordinary cheque book has a notice upon it telling the customer not to leave the book lying about.
– My bank does not do that, and I never saw such a notice. Perhaps my honorable friend’s bank is more careful than others. Take the next paragraph of the regulation -
To prevent forgeries and frauds, depositors are requested to keep their pass-books locked up when not being used, and anv case of any tampering with the figures or initials coming under the notice of depositors or Savings Bank officers should be at once reported to the superintendent.
Every depositor who enters into contractural relations with the Savings Bank has impressed upon his mind the conditions on which the bank does business with him, and the supreme importance of the pass-book. Regulation 24 says -
In case any depositor shall lose his pass-book he is required -
to give immediate notice thereof to a Savings Bank branch or agency;
to make a statutory declaration of bis loss in the form provided ;
to satisfy the Savings Bank officer as to his identity.
All this shows the essential part thatthe pass-book plays. It is, so to speak, the key which opens the flow of money from the customer’s account. The book is absolutely in his keeping. There can be no forgery about it. It can only get out of his keeping by. carelessness or by burglary, or something of that kind. People generally know when a burglary has been committed in their house; and in such a case a depositor can give notice at once. Savings Banks are established principally for the advantage of the thrifty poor, and if these regulations have no other effect than to impress upon customers a warning of the necessity of absolute care in preserving their passbooks and keeping them in safe places, it will do a great deal of good.
– I used that argument on a previous occasion, and the Senate would not listen to it.
– I trust the Senate will accept the argument now, and that the honorable senator will vote against his own motion. Then comes regulation 27 -
Any depositor wishing to withdraw the whole or any part of the turn deposited will be required -
to fill in and sign the prescribed withdrawal form ;
to present the withdrawal form with the pass-book to the Savings Bank officer, who will pay the amount and attest the entry in the pass-book with his initials and the official date stamp.
Each depositor when signing the withdrawal form should adhere to the one way of writing his signature, namely, that shown on the specimen signature form, otherwise pavment is liable to be refused. If a depositor wishes his account to be operated upon by one or more persons, an authority must be given on the prescribed form.
That is the check. If a cheque on an ordinary bank were forged, the bank would probably be responsible. But in this case the money could not be got out by means of a forged withdrawal form alone. The bank-book of the depositor must be produced, at the counter.
– Very simply done.
– It may be very simple, but I do not see why the bank should save the customer from loss’ if he carelessly allows his pass-book to goout of his possession. Everything depends upon the presentation of the pass-book. That is the only way in which the money can be got out. Then comes the paragraph in the regulations to which Senator St. Ledger’s motion refers. I need not read it again. If the pass-book gets out of the customer’s possession, either through carelessness or, it may be, through theft, immediately he discovers the loss he has to give notice to the bank. It seems to me that that is a very proper regulation.
– When I used that argument the Senate would not agree to it.
– That shows how sometimes the most eloquent and persuasive of men are not attended to asthey ought to be. My honorable friend has suffered that misfortune several times ; we all have. In the debate last year, two States were mentioned, Victoria and Western Australia, in which a. similar regulation exists. I know that there is also such a regulation in South Australia.
– Queensland hasexactly the same regulation, with the same wording.
– That does not make it good.
– I hope that Senator Rae does not think ‘for a moment that I would attempt to persuade any one into supporting the regulation if he did not believe that on its merits it is a reasonable and proper regulation. I think it is reasonable and proper. If the fact that a similar regulation is in force in connexionwith the Savings Banks of several of the States does not prove that it is a good regulation, it at any rate proves that the authorities of those banks think it a reasonable provision. I do not know how long the Savings Bank of South Australia has been, in existence, but it must be for some fifty or sixty years. This regulation is in forcein connexion with the Savings Banks of Western Australia, Victoria, and South Australia, and I undertake to say that no one can give an instance of a Savings Bank in any of the States which has not this provision, or something similar to it.
– That is to say that the poor must be careful; the rich need not be careful.
– The rich have to be careful as well as the poor.
– What safeguard would there be if there were no such regulation ?
– The position would be that they would be relegated to what is known as the general law. I do not know whether there would be many cases, but every poor person who had an account in the bank, and had the misfortune to have a fraud perpetrated upon him, would have to bring an action against the tbank for the recovery of his money, and it would be for a Judge and jury, after hearing a lot of evidence, to decide whether there had been carelessness on his part in connexion with his pass-book, ‘ as they now have to decide whether there has been carelessness in connexion with a cheque where a fraud has been perpetrated through an ordinary commercial bank. Every depositor who had a claim of this kind would be thrown into the Law Courts in order that it might be decided whether he should recover his money from the bank or not. We should have a repetition of what occurred in Marshall’s case, and,- really, it makes one’s mouth water, because there would first be a case in an inferior Court, -then in the Supreme Court of a State, then rin the High Court, and, finally, before the Privy Council.
– The honorable senator thinks that it would be better for the depositor to put up with the loss of his money than to be ruined by having recourse to the lawyers ?
– No; I think that the more fraud there is, the more people are compelled to have recourse tn that class of the community whose duty it is to promote honesty and to see that justice is done.
– If that be their duty, they are a singularly unsuccessful class.
– That is because of the combative and unruly instincts of their clients in most cases. If we are to have all this tenderness for depositors, what we should do is not to disallow this regulation, but to enact a provision that, however careless a depositor of the Commonwealth Savings Bank may be in regard to his pass-book, the bank must always pay up any loss he may sustain.
– That is putting it unfairly.
– No, that is the only remedy; there is no middla course that I can see.
– I think there is.
– Perhaps the honorable senator will tell us what it is? The view I take of this regulation is that it is reasonable and fair, and is essential to the administration of a Savings Bank on the footing upon which the Com mon wealth Savings Bank is established much as I dislike it. It is a part of its ad ministration, and I believe that every State Savings Bank has a similar provision for its protection, and necessarily so. Then there is the question - Is there anything to prevent the issue of this regulation? There is nothing.
– Are private banks, such as the Bank of New South Wales and the Union Bank, protected in the sann way ?
– They are protected if they can prove negligence to the satisfaction of the Court.
– Not under our Bills of Exchange Act.
– There is a modification in our Bills of Exchange Act, but the principle underlying the law still exists.
– Did this Parliament not deliberately reject a provision in the Bills of Exchange Act giving the banks that protection?
– Yes, to excuse them from liability; but they are’ liable at common law just the same. I remember that Senator Walker submitted the provision.
– No; it was a part of the Bill itself. It was clause 81 of the Bill, and I remind Senator St. Ledger that he voted for the retention of that clause.
– Quite so.
– Honorable senators will not find such a provision in the Bills of Exchange Act. We wanted to make them free at common law.
– But we did not do it. All that we did in that case was to refrain from making a legislative enactment as to negligence. The position is exactly as it was before, and the liability depends on the view taken by the Court of the circumstances of each particular case. Is there anything to prevent us from considering this regulation on its merits?
– Has the honorable senator not been considering it on its merits ?
– I have; but I promised Senator St. Ledger that 1 would deal with this point. He very properly and very strongly contended that something has happened which has put it out of our power to consider this regulation on its merits. That something was the omission of clause 48 of the Commonwealth Bank Bill as originally introduced. I have already said that the provision in the Act enabling regulations to be made provides merely that they shall not be inconsistent with the Act. There is nothing in the Act inconsistent with this regulation.
– But even the Governor of the Commonwealth Bank cannot run amock.
– No, he has to run the gantlet of the Senate. I know that regulations may be laid on the table and be overlooked, but it is not likely that such regulations as these would be overlooked. In any case that is the constitutional way we have ourselves provided for dealing with regulations. I have not made myself clear if I have not said plainly enough that I do not consider that this is a matter which should be provided for in an Act at all. I disagree with Senator O’Keefe, and think that this is a matter which is properly the subject of regulation. If there is nothing in the Act inconsistent with this regulation, there is nothing to prevent us dealing with it now that it is before us. . If there was a decision by the Senate last year in a certain direction it does not bind us this year. Although the clause, which has been referred to, was omitted from a Bill under consideration last year, there is nothing to bind us in dealing; with the matter when it comes before us again this year.
– How often would the honorable senator expect Parliament to reject this proposal before, the Government would be prepared to abide by the decision of Parliament?
– It is not a question of the Government being prepared to abide by the decision of the Parliament. If the Senate disallows this regulation now, there is nothing to prevent its being issued again next year.
– On the honorable senator’s argument there is nothing.
– What is there to prevent the Government bringing forward this session a measure which was defeated last session, or? if the Standing Orders permitted it, bringing forward in a month’s time a proposal which was rejected a month ago?
-Colonel Sir Albert Gould. - That is what they are doing.
– Why should they not do so. I never heard that the laws of this Parliament are like thelaws of the Medes and Persians - unalterable. We have enacted nothing to the contrary of this regulation and even if we had done so we could ‘ reconsider it in the following session, but it would have to be as Senator O’Keefe says by a Bill. We have not enacted affirmatively that the Comimon weal th Bank shall be liable inthese circumstances.
– So this is sneaked in by regulation.
– I do not think it is, and if it is the Government are responsible. But it is before usnow, and why should we not debate it?
-Colonel Sir Albert Gould. - We are doing so.
- Senator St. Ledger’s argument was that weought not to debate it; that last sessionwe rejected a clause to the same effect, and’ that finished it.
– No one has taken upthat attitude.
– That is the attitude which my honorable friend? takes up.
– The honorable senator is misrepresenting the attitude I take up. I said that both Houses of this Parliament arrived at a certain decision, and the Government have since annulled that decision by regulation.
– They have not annulled it. They have issued a regulation which, during the interval-
– Such straw-splitting. is not worthy of the honorable senator.
– The honorable senator is using a term which apparently he does not understand. I am not splitting straws. The Government may be right or they may be wrong in issuing this regulation. I am not defending them at all. They bring this matter forward: by regulation, and I think properly. Now that it is before us, let us deal with it on its merits, and dispose of it. If Senator O’Keefe believes that there is something to prevent that being done, let him say what it is. Senator St. Ledger strongly urged that we could not deal with thematter now, because it was rejected last. session. I ask honorable senators to say whether that is a reason why we should not consider it this session.
– Certainly not.
– Then there is nothing to prevent its consideration, and it seems to me we must, therefore, set aside all that has been said about the decision of last year, and consider the regulation on its merits. It may be as Senator O’Keefe has contended, that the matter should be dealt with in another Bill, but it is being dealt with by regulation. The honorable senator says that he would vote for it if it were proposed in it Bill. But why not vote for it in the form of a regulation? There is no partv matter involved, and I take the view I have expressed from the stand-point of one who disbelieves in the Commonwealth Bank, and particularly dislikes the Savings Bank branch of it, but if we are to have a Commonwealth Savings Bank it should be at least on the same footing as the Savings Banks of the different States.
– I can only regard the obtuseness of Senator Symon in regard to the attitude which has been adopted by Senator O’Keefe as one of the infirmities of a great mind. The position taken up by Senator O’Keefe is perfectly clear. He rightly affirmed that, although both Houses of this Parliament arrived at a definite decision as to what should be the law of the land, the Government have adopted a regulation in opposition to that decision - a regulation which, I very much regret to hear from the Vice-President of the Executive Council, was framed by the Governor of the Commonwealth Bank. I hope that the Government will take full responsibility for their action upon every question which may crop up. I would like to know from the Vice-President of the Executive Council whether, when this regulation was presented to them, Ministers reminded the Governor of the Bank that the matter had been keenly debated in Parliament, and that both branches of it had decided against it becoming the Statute law of this country. Senator Symon has said that the provision is not contained in the Bill, and that, consequently, it found its rightful place in the regulations.
– Even if it were in the Bill, would not Parliament have the right to amend it?
– Yes, and that would be the straightforward way of do-ng things. I object to the Government in- . dulging in slim practice. I submit that it was the duty of the leader of this Chamber to give effect to the will of the Senate. Although it may be distasteful to him to have to embody in a regulation something which he opposed, I contend that when a matter has been thoroughly threshed out, it is his duty to sink his individual view, and to yield to the wish of the Senate. I thank the honorable senator for the kindly way in which he let down those of us who opposed the provision contained in this regulation, by saying that we had been hoodwinked. What happened when this provision came before the Senate? Senatoi Walker moved to excise it from the Bill I did not pay a very great deal of attention to his remarks. They were made in his usual plain, straightforward way, but when the Minister of Defence answered him I could tell, from the whole tone oi his reply, that he had no case. It was the weakness of the case presented by him that induced me to take action on that occasion, with the result that a debate was initiated which lasted for hours. Immediately the Minister spoke I knew that the clause was not designed to meet merely cases of persons who were negligent or careless. The most careful individual in the world may be the victim of a fraud. It. is still within the power of the Government to draft a regulation to punish negligence, and at the same time to protect innocent persons who are the victims of fraud. I happen to represent a very large ‘section of the careless portion of the community, who cannot possibly keep their bank-books in iron safes. What is more common than for a man in the back-blocks to see his bank pass-book not more than once in six months? He may go out shearing in Queensland, and work his way right down to New South Wales. At the end of the season he may desire to put his money in the bank, and suddenly find that his passbook has disappeared.
– He cannot give notice of its loss the day after it was taken.
– Exactly. The majority of the depositors in the Savings Banks live in small cottages, and have no safes in which to keep their, pass-books securely. They may be absent from their homes for many months. Yet no provision has been made by the Government to protect innocent persons who may be robbed of their bank books. A burglar may enter ; he house of a depositor, and yet nothing may be missed. A bank pass-book would not be likely to be missed. I recollect that when this matter was debated on a previous occasion, it was suggested that the Government should draft a clause to meet the views of the Senate. I would scarcely like to hint that they had in mind an effective way of defeating the wish of this Chamber. After the matter had been debated here for hours, the Bill was transmitted to the other branch of the Legislature. There, a strong feeling was manifested against the clause being retained in the Bill, and, as a result, it was eliminated. Yet we now get the same provision embodied in a regulation. I hope that we shall carry the motion submitted by Senator St. Ledger. I recollect the action taken some time ago by an individual who held a very strong view on the constitutional duty of his Government and his duty to the Legislative Assembly. I have in mind a Bill which was introduced into the Legislative Assembly of New South Wales for the purpose of giving effect to the principle of payment to members. It was brought forward by a Minister as a private member, and was opposed by the Premier in a similar capacity. It was forwarded to the Legislative Council, where the principle at issue was rejected. Immediately the Bill was returned to the popular Chamber, the head of the Government, in order to assert the rights of the Legislative Assembly, took it up, and had it passed again. Seeing that this particular question was discussed in the Senate, and a verdict was given in opposition to the Government, I submit that Ministers should have sunk their own private views in order to give effect to that verdict. Here is the position we shall reach if that system be not adopted : whenever there is a majority in this Chamber in favour of striking out a clause in a Bill, in order to make assurance doubly sure, we shall have to draft a provision to prevent the Government from sneaking in that clause by way of regulation. I am pleased to hear the VicePresident of the Executive Council say “ Hear, hear,” but I submit that that is not the position in which honorable senators should be placed. This regulation flouts the expressed wish of both branches of the Legislature I do not blame the Governor of the Commonwealth Bank for it ; I blame the Government. The moment that regulation was put before them it was their duty to point out to him that Parliament had already refused to sanction any such provision. Of course, if the Vice-President of the Executive Council is so carried away with his own selfconceit as to imagine that those who voted in opposition to him on that occasion were hoodwinked, that is his affair. But I say that such considerations ought not to be introduced into a debate upon matters which do not involve great principles.
– They are very important, any way.
– I recognise that. They are very important to that large section of the community who, if this regulation be given effect to, may lose the savings of a lifetime.
– How much have they lost in similar circumstances in other banks ?
– I do not know. The Vice-President of the Executive Council declared that, . if a case of hardship arose, provision would be made to meet it. I say that no such provision can be made. The Governor of the Commonwealth Bank has to administer its affairs in accordance with the regulations. He has to manage that institution according to law.
– The law would not prevent him from making that provision.
– I hope we shall never countenance such a slipshod method of managing our financial institutions, because, if we do. it will inevitably result in favoritism. It is absurd for the VicePresident of the Executive Council to say that provision will be made to meet cases of hardship. The Government should have differentiated between wilful negligence and persons who are the. victims of fraud. It is not too late for them to do so’ now. It they will promise to frame a regulation with that end in view, I am ready to reconsider my position. But when the Senate has deliberately arrived at a decision - a decision which has been indorsed by the other branch of the Legislature- it is not for the Governor of the Commonwealth Bank to upset it. That officer may receive a mighty big salary, but if his salary were double what it is, and his travelling expenses were ten times as much as they are, I would not be induced to give way one iota.
– What is the honorable senator talking about? Did we not pass a Bill authorizing us to borrow £3,000,000, and did we not repeal it?
– A new Parliament repealed it. But there is no analogy between the repeal of a Bill and the sneaking in of a regulation by the Government in the most slim fashion. Notwithstanding that both Houses of this Parliament, after debating the question exhaustively, decided that the Commonwealth Bank Bill should contain a provision to protect persons who might be defrauded of their pass-books, they are to be robbed of that protection by means of this regulation.
– We never made any provision of the kind.
– We did not do it by means of a direct clause, but there are quite a number of honorable senators who, like myself, believe that we had in power a Government which would give effect to our expressed intention.
– The Bill was left in a form which enabled them to obtain redress.
– They could only get it by law.
– The VicePresident of the Executive Council says they could only obtain redress by law. What has happened since Parliament rose that he should desire to take away the legal right of any person to obtain from the Commonwealth Bank the moneys which he had deposited there? We know very well that, in private banking institutions, there- are expert officers to detect fraud. But the depositor in the Commonwealth Savings Bank, who has been robbed of his pass-book, may not be aware of it.
– Will the honorable senator give any instance in which this has occurred where a similar regulation is in existence ?
– The VicePresident of the Executive Council must be aware of the immense frauds which were perpetrated in Sydney, where, after passbooks had been sent in to the bank, they were never returned to the depositors.
– When our amendment went back to the other House there was a case mentioned which induced the Prime Minister to withdraw his dissent from what the Senate had done.
– In this matter there are other persons to be considered besides the criminals who may act in collusion to get money out of the Commonwealth Bank. We had the absurd illustration put forward by the Minister, of Senator St. Ledger representing him and getting his money out of the bank. He forgot that there is a scientific method by which that possibility can be got over, and that is by the introduction of the finger print system. If the banking authorities wish to make themselves absolutely safe against the commission of forgery they can introduce a simple system of finger prints by depositors.
– What about a case of collusion between a party in the bank and a stranger?
– It would be necessary to have a finger-print expert in every bank.
– Not necessarily. Under present banking conditions it takes about three days for a depositor to draw his money out of a bank. If a finger print of every depositor were sent down to the central office of the bank, it need only be used in cases when’ suspicion was aroused.
– A depositor can draw up to £10 out of any bank without giving notice.
– Even so; in most of the country towns the depositors in the banks are well known. A man who is conducting a bank in a town where there are only a few hundred people, and the clients of the bank number fifty or sixty, knows every client, and there is no danger to be run. In the larger centres the banking authorities are in a position to devise means to protect the banks. But that will not be the position of a depositor who, unknown to himself, may lose his passbook, not by carelessness or negligence, but by misfortune. Under this regulation, if it be not disallowed,’ a man may lose the whole of his life’s savings.
– Upon whom are you going to place the responsibility of proving that it was carelessness ?
– 1 am prepared to accept any reasonable regulation providing for how the responsibility is to be proved, but I am not prepared to accept a regulation under which an absolutely innocent man, who has not been negligent, may lose his life’s savings.
– This regulation makes the depositor liable for the carelessness of a bank official.
– Exactly. There is no doubt that under the regulation the bank officials could be as careless as they liked. A man might present a cheque with a signature which might not appear like the original signature at the bank. The bank official might not compare the signatures, and might cash the cheque, and then the bank could blame the depositor for having been careless, simply because his pass-book had been stolen. If a. man has been thrifty during his life, and managed to deposit ^300 in the bank, that is too great a penalty to impose upon him for the loss of his pass-book. It is up to the Government, I think, to see that there is a fair deal.
– With all the millions deposited in the banks we never hear of any case of this kind.
– We never hear of such cases. We have not to legislate simply for cases which we have heard of, but the probabilities and possibilities of eases which may arise. To my mind, it is a grave injustice to say to the depositors in the Commonwealth Bank : “ When you place your money in our hands you relieve the bank from all responsibility for fraud, and if you lose your pass-book under any conditions you shall bear the whole responsibility for any case of fraud which may be committed.” Cases of fraud are sure to be few and far between, because, fortunately, this is a very honest community. But how much easier would it be for the whole of the people of the Commonwealth to bear the loss of ,£300 - the life earnings taken from one man - than it would be for the unfortunate victim of a. fraud too clever even for Senator McGregor to have foreseen? How much easier would it be to spread this liability over the whole of the people - and it would not be often that it would occur - rather than let it rest upon the shoulders of the man who confidently placed his life’s earnings in the care of the bank?
Motion (by Senator Keating) negatived -
That the debate be now adjourned.
– I hope that the Senate will adopt this motion and disapprove of the regulation which is under consideration. I do not intend to speak at any great length, principally because when clause 48 of the Commonwealth Bank Bill was under consideration I discussed the subject on its merits more than once. Those who were present then will remember how long and strenuously the debate was conducted, under personal inconvenience and disadvantage to very many. It must have been abundantly evident to the Government that the Senate was determined that no such provision as was contained in clause 48 of the Bill should be the law ‘-/f I he Commonwealth in relation to the Commonwealth Bank. Since then, however, the Government, in spite of that express resolution have, by getting the Governor-General in Council to pass this regulation, attempted to give the force of law to a provision exactly indentical in effect with that clause. I wish to say a few words in regard to some of the statements that have been made during this debate. Senator Symon was asked in his speech what would be the position if this regulation were disallowed, and he said that the position would be that the parties would be forced back on to the general law. When the debate took place on clause 48, what the Senate desired was that a depositor in the Commonwealth Bank and the Commonwealth Savings Bank would, have their relations in respect of any such transaction as that contemplated by the provision governed by the general law, which applies to all cases of banker and customer.
– On the merits of each case.
– Exactly. What the Senate desired then was that the merits of each case should determine the respective liability of the banker and the customer, just the same as is the position of a private bank and its customer.
– With our experience, we require something more certain now.
– Yes; we are not asked, as was suggested by Senator Symon, to make a provision that, under any and all circumstances, the bank should be responsible. No suggestion of that kind was made in the Bill, or is in the Act. No suggestion approaching anything of that kind was made in the debate on clause 48, or so far as I have listened to it in the debate on this motion. And just as we are not invited to saddle the bank with unlimited responsibility in these cases, so, too, we are not justified in saddling the depositor with unlimited liability, as this regulation would saddle him, if it were allowed to have the force of law. The loss must in every case fall on the depositor. How the bank-book got out of his possession, whether it was removed by fraud or by force, or whether he happened to misplace” it, or to forget where he had placed it, because it was some considerable time since he had handled it - all these circumstances would be of no avail to him. Without limitation, without qualification, without consideration of any other circumstance than the presentation of the book and the withdrawal of the sum, the depositor must bear the brunt of it, if he did not authorize its withdrawal.
– The mere loss of the bank-book would disqualify him.
– He would be disqualified by the mere loss of the bankbook, its abstraction by anybody, its removal from his possession, which might take place in any one of a hundred ways, -mcT possibly the intermediary might have acted quite innocently. For instance, the child of a depositor might take his bankbook and play with it outside his hut, or elsewhere, and it might be picked up, and taken away. The child would possibly know nothing of the loss; the book would get into the hands of some person, and if it was utilized fraudulently, the depositor would have to tear the loss.
– People do not look every day to see where their bank-book is.
– Exactly. A depositor would not have an opportunity under any circumstances of asserting a claim against the bank. He would not have an opportunity of showing by positive evidence that he had exercised all due care with regard to the custody of the book. So having realized that it would not be just and fair to saddle the bank with the responsibility in every case in which there was a fraudulent withdrawal, we should also realize that it would not be fair or just to saddle the depositor with the loss in every case. The position should be that the particular merits of each case should determine upon whom the loss should fall. That is the general law at present, and if this regulation be disallowed, the position will be that the general law as to the respective degrees of negligence, and the respective amount of liability as between the bank and the customer, will apply as between the Commonwealth Savings Bank and its customer just as it applies between an ordinary bank and its customer. I draw attention to one or two considerations that have occurred to me during the course of the’ debate. It has been said that the pass-book is the key to the situation, the depositor’s title deed, the means by which the stream of money flows from his account into his pocket. It has also been pointed out that the book contains inside its cover a notice to depositors warning them to be careful, and that this constitutes the difference between a depositor in an ordinary bank and in the Savings Bank. I submit that the officers of the Commonwealth
Savings Bank are better protected than are the officers of ordinary banks in regard to detecting fraud. First of all, a depositor’s order cannot be honoured unless the pass-book is presented. The officers have an opportunity there and then of identifying the signature. In an ordinary bank the officers will probably not turn up the specimen signature-book to see whether the signature on a cheque corresponds.
– Does the honorable senator think that there is a copy of the depositor’s signature in his pass-book?
– I understand that that is so.
– Oh, no ! only the name of the depositor is inside the book, not the signature.
– Then I need not press that argument. It appears that in this respect officers of the Commonwealth Savings Bank are in no better position and no worse than the officers of an ordinary bank. But the pass-book has to be presented, and that in itself affords to the officers of the Commonwealth Savings Bank a protection which is absent from the officers of private banks. It is said that officers of the Commonwealth Savings Bank in the country districts, because they happen to be postmasters or postmistresses, labour under some disadvantage. But, counterbalancing that handicap, they have the advantage - which the officers of private banking institutions have not- of knowing personally practically every depositor. They would know when a stranger presented a pass-book belonging to a depositor, and attempted to make a withdrawal by its means. A cheque upon a private bank may be drawn and passed on to the payee, who may indorse it and pass it on to somebody else. Eventually the cheque reaches the bank through the clearing-house, and is not presented over the counter. It will be agreed that the officers of the private banking institutions in this respect have not anything like the same facilities for observing fraud as have the officers of this institution. I believe that a calm and dispassionate consideration of the opportunities for detecting fraud offered to the officers of both institutions will show that the advantage is all in favour of the Commonwealth Savings Bank. If that be so, why hedge the bank round with a wall of protection which is not given to private banks ? The Vice-President of the Executive Council tells us that the Governor of the bank feels that a regulation of this kind is necessary. He has looked at the regulations governing the various State Savings Banks, and finds that they have a regulation of the kind. The Governor of the bank may honestly entertain the opinion that such a regulation is essential, but we may differ from him. Senator McGregor also pointed out that Parliament had not legislated to the contrary, and that the regulation in question is not inconsistent with the Act. Senator Symon has pressed that argument home, and, like Senator Gardiner, I was much surprised to hear the vehemence with which he submitted it. There are plenty of things that would not be at all inconsistent with the provisions of the Act, but which, if provided for by regulation, might be entirely unnecessary. This regulation is certainly inconsistent with the opinion expressed by Parliament. It is almost identical with a clause in the original Bill, which Parliament deliberately rejected. We affirmed strongly and resolutely that we did not wish to see a provision of the kind made part of the law of the country. When the Bill went back to another place, the Prime Minister intimated that he intended to ask that the Senate’s amendment should be disagreed with. But, on further consideration, he decided to acquiesce. That was done, and the Bill became an Act, with the objectionable provision omitted from it. No matter what may be said to the contrary, this regulation is simply a repetition of the provision which we negatived. This procedure certainly savours of a want of candour on the part of the Government. We are not being invited to reconsider our previous determination. The simple position is that there is power to make regulations which are not inconsistent with the Act. The regulations made have to be tabled in Parliament within a certain period. If Parliament does not disallow any of them, they have the force of law. After the expiration of a certain period it would be too late for us to criticise a regulation with the idea of having it annulled, unless such pressure were brought to bear upon the Government as induced them to withdraw it. These banking regulations were issued on 5th July. They are in operation at the present time. They will have the force of law unless we disallow any of them. I remind honorable senators that there has been in this Chamber a continuous attack upon the principle of legislation by regulation. Of course, regulations are necessary in connexion with comprehensive measures dealing with very large subjects, to enable those measures *.o be administered in the all- embracing way contemplated. But I cannot recall a single instance in which it has been attempted by regulation to give legislative effect to something which the Senate or the other House of Parliament “has refused to embody in a Statute; nor can I recall an instance in which it has been proposed to annul by regulation anything resolved by a branch of the Legislature. Just as it is impossible to annul by regulation what Parliament has positively affirmed, so it ought to be impossible for the Government to establish by regulation what we have previously deliberately refused to affirm. If the Government, upon the advice of their responsible officers, thought it was necessary that an alterationshould be made, they might have submitted to Parliament a proposition to amend the Commonwealth Banking Act. If they did not care to go to that length, they could have brought down this regulation and directed attention to the particular one in question, asking the Senate to affirm it. If the Government had taken some suchcourse, and had drawn the attention of the Senate to the issue of this regulation, which is clearly out of harmony with the views expressed by the Senate on a previous occasion, there would not be the same degree of resentment at the procedure adopted as has been evidenced in the course of this debate. The course taken by the Government is calculated to provoke resentment on the part of the Senate, irrespective altogether of the merits or demerits of the provision. . If this procedure is to be allowed to go without challenge, where are we to stop in the matter of regulations?
– Honorable senators have the fight to challenge any regulation, they please.
– We do not wish to challenge every regulation. The honorable senator is aware that regulation? are tabled very frequently during a session. They are most voluminous, and it is almost impossible for any honorable, senator, however industrious, to peruse the whole of them. But a regulation of this kind, dealing directly with something which had been debated vigorously and determined, as this matter was, by the Senate on a previous occasion, should not have been brought forward, in the way this has been, without the Senate having an opportunity of considering it. Had it not been for vigilance in certain quarters, it is possible that the
Senate would never have had an opportunity to discuss this regulation with any effect. I sincerely hope that, apart from what honorable senators may think of the merits of this regulation, they will say unmistakably by their vote on the motion that they are determined that when the Senate has expressed its opinion on a matter, if it is to be expected to alter that opinion, it should be deliberately invited to do so, and that no provision contrary to an expressed opinion of the Senate shall be given the force of statutory law in the wayproposed by the issue of this regulation.
Senator RAE (New South Wales) £10.43]. - * do not intend to traverse the ground already followed by other speakers, but, needless to say, I intend to support the motion. The matter has been discussed on two grounds, one as to the intrinsic merits or demerits of the regulation, and the other as to the action of the Government in endeavouring to carry by regulation what this Parliament has refused to pass in the form of a clause in a Bill. When the VicePresident of the Executive Council tells us that we have the right to challenge every regulation brought up, he must realize that it would be very foolish to invite honorable senators generally to challenge all regulations, on the off chance that one might slip through. It appears to me that we can afford to be straightforward in these matters. Every decision of the Senate should be respected, unless it is openly asked to reverse its decision by the passing of an amending Bill. Some honorable senators have said that, during the many years in which a similar regulation has been “in force in connexion with the State Savings Banks, they have heard of no injury to depositors because of its existence. The reason for that may be that a depositor who was defrauded, seeing that, under such a regulation, he would not be able to establish a claim against the bank, has preferred to say nothing, since it would be of no use to advertise his misfortune to the world. There have, however, been cases of the kind which have been made public. When these regulations came out they were published by the Sydney newspapers. I happened to be at home at the time, and, seeing them in the Sydney baily Telegraph, 1 went over them. As .a rule, when I receive copies of regulations here I do not bother about them, because honorable senators have many more important matters to attend to. But, in this instance, I read –the regulations through, wondering whether there might not be something in them differing from the regulations of the States Savings Banks. As soon as I saw this regulation, I wrote at once to the head of the Government, protesting against it. I expressed the hope that, if the Governor of the bank had issued it on his own authority, it would be withdrawn. I gave the head of the Government due notice that I intended to object to this regulation. Senator St. Ledger’s action was, therefore, not unforeseen, and I should have taken action in the matter if no other honorable senator had done so. On either the ground of the intrinsic merits or demerits of the regulation, or of what I regard as a dereliction of duty on the part of the Government, I am prepared to support the motion submitted by Senator St. Ledger. I know of numerous instances such as those suggested by Senator Gardiner, where acquaintances and friends have kept Savings Bank pass-books in places known to each other. I put it to the common sense of any man to say whether the average Savings Bank depositor thinks it as necessary to see that his pass-book is safe with same daily regularity as he would milk his cow. Is it not a fact that we have so many necessary duties to attend to in our daily lives that such a thing as a Savings Bank pass-book is only looked for when it is required ? The constant reiteration of the statement that as soon as a depositor discovers the loss of his pass-book he can give immediate notice to the bank goes by the board altogether.
– The book may be fraudulently used, and returned again to its place.
– That is so. I had a little money in the Savings Bank before I got into this Senate.
– The honorable senator has a good deal now.
– I was going to say that I left 6s. or 7s. in the Savings Bank in order to keep the account open if at any time I should have a pound or two to put into it, but I can assure honorable senators that I never looked for the pass-book until I required to use it. The average depositor looks for his pass-book only when he requires to use it. I have known some artisans and mechanics in permanent positions who are in the habit of making regular deposits from each week’s earnings, but there are many thousands of people who only deposit an odd pound or two at very irregular intervals. The pass-books of these people might be out of their possession for weeks, or even months, before they would find it out. It should not be forgotten that the loss of what might be a life’s savings would be a matter of very much greater importance to an individual depositor than it would be to the Savings Bank. I plead for co-operative losses, if there are to be any, rather than for individual losses. The loss of an individual depositor’s savings spread over the whole of the depositors in a Savings Bank would be so infinitesimal as to be practically nonexistent. Senator Symon seemed to think that the severest possible penalty, extending even to the loss of the whole of his savings, would not be too great to impose upon any person so negligent as to lose the run of his pass-book. That is a miserable and stodgy way of looking at things. I wonder whether the honorable senator has always been so absolutely careful that he never lost anything. I suppose that even he has sometimes lost a case. If the States Savings Banks have a similar regulation in force, that is a good reason for a new departure in connexion with the Commonwealth Savings Bank. We have the choice of alternatives. We may either leave no room for the bank to lose anything, or leave ample room for the bank officials to be careless. It is true that a bank official who is incompetent, or wilfully negligent, may be punished, but the punishment of a negligent bank official would be but a very poor consolation to the depositor who, through his negligence, might have lost all his savings. Senator Gardiner has mentioned the case of men who have to go some distancefrom their homes in search of employment, and leave their bank pass-books in their tents or humpies, where they may be taken during their absence, but I submit a case that is not infrequent. I take the case of a woman struggling hard to maintain a family, but with a husband who, though well educated, earns little or nothing, and spends what he does ‘earn on drink. The wife may be saving up by hard work at the sewing machine, or the wash-tub to secure a nest-egg in order to send a child to school, or to meet some other emergency. Who is there who will know so well that woman’s signature, and where she keeps her bank pass-book as her waster of a husband ? He may extract it during ner temporary absence, draw the whole of her savings, and, perhaps, drive her to selfdestruction. The loss of a woman’s savings in that way without hope of recovery would be sufficiently serious in some cases to drive her to despair and ruin.
– I could draw .1 very nice picture also.
– I am aware that the honorable senator could, do so, and I have no doubt he would if he had not started wrong, and his Scotch stubbornness did not prevent him from’ admitting it. If the honorable senator had taken the right instead of the wrong side in this matter, I have little doubt that he could draw a much more pathetic picture than any I could draw. But I am not painting the picture in any fanciful colours, as the fact that there are many such instances as I have described must be common knowledge.
– I have been a year or two longer than the honorable senator amongst the working classes.
– 1 am not so sure of that. 1 believe that I am as old as is the VicePresident of the Executive Council, though the honorable senator was in Parliament during some years when I was taking a well-earned rest from it. I do not know that we can measure experience by years anyhow. I challenge the honorable senator to dispute the fact that there are many instances such as I have described. The circumstance which was stressed so much by Senator Symon that a depositor’s pass-book, in addition to the withdrawal form, would require to be filled up by any fraudulent person presenting it. affords an additional safeguard to the Commonwealth Bank as well as to the depositor. It cuts both ways. But I rose principally to point out the fallacy of the honorable senator’s argument that we must either retain this regulation in its present form, or notify to the world that any depositor may be as careless as he chooses, and yet the Commonwealth Bank will be responsible for the return of his money. He declared that no middle course was possible. It appears lo me that some affirmative clause should be inserted in the Act in lieu of the provision which Parliament excised. Apparently, we cannot trust the Government to do the right thing. We require, therefore, to insert an affirmative clause setting forth that the bank will guarantee every depositor’s money unless he is guilty of culpable carelessness, the onus of proof of which shall lie upon the bank. I admit that it would be difficult for the bank to prove culpable carelessness on the part of a depositor, but any modification of such a clause would render it equally difficult for the depositor- to prove that he had not been guilty of negligence. The losses that will arise under such a provision are not likely to be large. But even if it would prevent only one depositor from losing the savings of a lifetime, we should be justified in securing to every depositor that absolute safety which a Savings Bank, above all other institutions, should insure.
Motion (by Senator Sayers) negatived -
That the debate be now adjourned.
– I thought that at this late hour the Government would have been prepared to agree to an adjournment of the debate. But as they have not seen fit to do so, I wish briefly to place upon record my view of the regulation to which attention has been so pointedly called by Senator St. Ledger. Already we have so many regulations under Acts that it is impossible for any honorable senator to follow them. A regulation of this character might easily slip through Parliament without honorable senators being aware of it. In this instance, it was practically an accident that it was noticed. The Vice-President of the Executive Council has made a very vigorous speech this afternoon, but not more vigorous than that which he made when he attempted to force a similar provision through this Chamber. We are now called upon to eat our own words. Honorable senators know that when this question was previously discussed, the view was expressed that a hardship would be imposed upon the general public if such a provision became the law of the land. Since then a Commonwealth Savings Bank has been established, and by some means or other the Government have been induced to embody the provision in a regulation. I agree with Senator O’Keefe that had they come down with an amending Bill, they would have adopted the right course. But, instead of doing that, they have attempted to override the intention of Parliament by means of a regulation. I submit that that is a very bad practice. I enter my protest against this regulation, which I hope the Senate will reject. That is the only course open to us if we are not going to stultify ourselves.
Senator Lt.-Colonel Sir ALBERT GOULD (New South Wales) [11.3].- We really occupy a very peculiar position in regard to this matter, because it is only a few months ago that we arrived at a deliberate decision upon it - a decision which it is now proposed to reverse by means of a regulation. The Vice-President of the Executive Council has argued that because the Governor of the Commonwealth Bank is a very experienced officer, and because he thinks that this regulation is desirable, Parliament should subordinate its judgment to his. But I would point out to honorable senators, that we have in this chamber a banking expert who has been connected with banks for as long a period as Mr. Miller has been in this world. I refer to Senator Walker, who was the first to draw attention to the objectionable provision in the Commonwealth Bank Bill, which has now been made the subject of a regulation, and to urge that it should be eliminated.
– He wanted the same protection extended to the private banks.
– Senator Walker has been a banker all his life. As a young man he commenced his career in the Bank of New South Wales in London. He afterwards came to Australia, and worked up from the position of an ordinary clerk to that of inspector and manager of a number of country branches. Subsequently he became the general manager of one of the new banks established in Queensland, and assisted to place it upon a firm foundation. When he dissociated himself from the active management of that bank he became one of the directors of the Bank of New South Wales. So that, practically for the whole of his life he has been associated with banking institutions. His experience is quite as great, if not greater, and his knowledge quite as large, if not larger, than are the experience and knowledge of the Governor of the Commonwealth Bank. In saying that I have no desire to detract one jot from the value of Mr. Miller’s services. He has been actively engaged in banking pursuits ever since he was a boy. We have two experts, therefore, who have placed different views before us, and we have to decide between them. We know that Senator Walker is very anxious to see the right thing done in connexion with financial matters. Mr. Miller is charged with the administration of the Commonwealth Bank, and it is only natural that he should desire every possible provision to protect himself and his officers from fraud. He knows just as well as we do that a similar provision obtains in respect of other Savings Banks, and, naturally, he wishes that that safeguard should be extended to the Commonwealth Bank. But the Government knew the attitude which had been assumed upon this question by both Houses of the Legislature. They were well aware of the conclusion at which this Parliament had arrived, and, consequently, they cannot shunt their responsibility in this connexion upon any Government officer. It is very bad taste on their part to attempt in this surreptitious way to institute a change which this Parliament had deliberately determined should not be made. If they could have brought forward any valid reason for that change, they might have obtained it very simply by introducing an amending Bill. It is rather a peculiar circumstance that an honorable senator who declares that he is entirely opposed to the Commonwealth Bank should have done his Utmost to persuade the Senate to take advantage of this regulation. The whole of (his arguments were marked by special pleading. Of course, we have to assume that the Government have power to make this regulation. But Parliament has a right to debate it, and to say whether or not its original determination shall be adhered to. I protest against any attempt being made -to get behind the decision of both branches of the Legislature by means of a regulation. When I turn to the Act under which this regulation has been framed, I find the following provision -
The Governor-General may make regulations not inconsistent with this Act prescribing all matters which are required or permitted to_ be prescribed, or which are necessary or convenient to be prescribed, for carrying out or giving effect to this Act.
I ask honorable senators whether, under such a power to make regulations, it was ever contemplated that an attempt would be made to deal by regulation with a matter which had been deliberately set aside by a vote of the Senate and by the acceptance of that vote by the other House. The remaining portion of this section cannot apply in any way to this regulation, because it goes on to say - and in particular for making provision for the issue, inscription, transfer, transmission, and redemption of inscribed stock of the Bank, and all matters incidental thereto.
It is a matter for very ‘strong argument indeed as to whether, under the wording of the section, the regulation is really worth anything. Under a power to make regula-» tions, the Government have no right to depart from the principles of the Act of Parliament or to add to them. The Act is supposed to contain the vital principles of the law, and any regulations must come clearly within the purview of what has been determined directly by ‘Parliament.
Although I admit that, by means of a quibble, it might be argued that the Senate has not deliberately said that the Government cannot do this sort of thing, and that, therefore, they may consider the matter, it is altogether contrary to the intention of the power which is given by Parliament to them to prescribe certain things by regulation. Is it necessary, for instance, in order to carry the Commonwealth Bank Act into effect to say that the Government shall be saved from the responsibility for certain acts of negligence on the part of their officers? The regulations requiring a pass-book to be given to a customer, and the production of the pass-book, may be convenient for the carrying out of the Act, but is it convenient for that purpose that, where there is negligence on the part of the Government by which a person has been able to effect a withdrawal of money, an innocent party shall suffer? It appears to me that the re- ,gulation is ultra vires. It may be tested some day in the Law Courts, or it may never be tested. But, apart from that, we have heard nothing to justify us in changing our opinion. On the merits of the case we ought to stand by the decision arrived at by Parliament last year. I say “ by Parliament “ because both Houses arrived at this conclusion, and the Prime Minister, on behalf of the Government, accepted the Bill without clause 48- While it may be said that the laws of this Parliament are not like the laws of the Medes and Persians - never to be changed or altered- it ought to have a little self-respect ; and if it made a mistake in coming to a certain conclusion it ought to insist upon being invited to deal with the mistake in a constitutional manner, that is, by direct legislation. When regulations are made under an Act, we assume that they clearly come within the powers given therein, and introduce no changes in the law. But if it is found that a mistake has been made in laying down certain principles for the purpose of carrying an Act into effect, honorable senators have the opportunity, if they care to take the trouble, to have the regulations considered within a limited time. If no action is taken within that time, it is assumed that they are satisfied with the regulations as they stand. By all methods of reasoning, I do not think that the Government are justified in making a regulation of this character. If they could say that a surprise division was taken, or that the opinion of the Senate was not fairly ascertained, there might be some justification for their act. But seeing that twenty-four senators voted on the clause, and eight senators were paired, it may be fairly said that there was a legitimate expression of opinion by the Senate as to what the law should be.
– Did you not, in 1907, vote for similar protection to private banks ?
– In 1907 I voted for a proposal to get over the effect of the decision in the case of Marshall v. The Colonial Bank. In that case, let it be clearly understood, there was unmistakable negligence on the part of the drawer of a cheque. He left a large space in which a person could write certain numbers, 1.00 or 200, and so many pounds. There was a difference of opinion between the State Court and the High Court, but the law was laid down definitely by the latter that the bank was liable for the money which it had paid over on the cheque. When the Bills of Exchange Bill was under consideration, Parliament declined to change the liability of the bank in a case of that kind. The Commonwealth Government have tried to devise a means by which they can escape that liability. If this regulation be confirmed, we shall have this anomaly, that while a depositor in the Savings Bank branch will be responsible for the carelessness of the bank, a depositor in the commercial branch will take exactly the same position as does a depositor in a private bank- That makes an unfair and invidious distinction between two classes of depositors. I do not intend to argue the matter on the line which Senator McGregor alluded to so contemptuously as “ this attempt to talk about the poor man and the poor washerwoman.” He spoke as if it were a contemptible thing on the part of any honorable senator to talk about persons who, by virtue of their poverty, appreciate the value of the few pounds they have much more than do persons who can afford to lose money and think no more about it. Honorable members opposite must speak with their tongues in their cheek when they mouth their desire to protect the poor against the wealthy and the vicious. Out upon such Democracy ! Let the people know that those who slobber over them, and profess to be their friends, do not care a snap of their fingers, so long as they can get themselves returned.
– Now give the servant girl a turn.
– I leave that to the honorable member when seeking the votes of the ser vant girls. I have enjoyed the confidence of the people for more years than he has. There is an old Latin proverb to the effect that those whom the gods wish to destroy they first drive mad. That must be the case with this Government. So flagrant a disregard of the intentions of Parliament is some proof that Ministers are becoming demented.
– The strongest justification of the regulation put forward by the Vice-President of the Executive Council was that it is necessary to protect the Savings Bank against the carelessness and negligence of its customers. On two occasions - when dealing with the Bills of Exchange Bill, and when the Commonwealth Bank Bill was before us - the Senate has rejected a proposal for protecting bankers, recognising that the common law gives them sufficient protection. This is the clause that appeared in the Bills of Exchange Bill -
Whereto) a cheque, drawn on a banker by a customer, has “been drawn by the customer with negligence, and (i) the negligence of the customer has afforded facility for the ‘ fraudulent alteration of the amount of the cheque, and (r) the cheque has been fraudulently altered so as to increase its amounts, and
Under that clause, four conditions had to be complied with before the banker could obtain indemnity, but under the regulation which is being objected to, there is no condition at all. Yet the Senate refused topass the clause which I have read, and no provision like it is to be found in the Bills of Exchange Act. Senator McGregor was one of those who voted against the clause. To my mind, what is law for private banksshould be law for the Government bank. When the Commonwealth Bank Bill was before us, we deliberately struck out of it a clause the wording of which was almost the same as that of the regulation to which we are objecting, and the other House accepted our amendment lt. has been said that they did so because the session was nearing its end. Whatever were the circumstances, they agreed with us that the provision should not become law. Now we find it embodied in a regulation having the force of law. There is too much of legislation by regulation. Senator Keating, who* when a Minister, was an ardent advocate of government by regulation, now agrees that there is too much of it. T could quote hundreds of instances in which he pointed out the convenience of doing things by regulation.
– And I could justify each instance.
– The honorable senator voted for protection to private banks which he now objects to giving to the Commonwealth Bank.
– Because I was in charge of the measure under discussion, but Parliament having struck out the clause which the honorable senator read, I think that we should act in the same way towards the Commonwealth Bank as we acted towards private banks.
– I have always been opposed to the granting of this protection to bankers, who, in my opinion, are sufficiently protected by the common law. I did not favour, two or three years ago, a course different altogether from that which I favour .to-day. What is the., position? There are probably 100,000 people who will be depositors in this bank, and who have no fixed place of abode. They follow nomadic occupations, and live in tents. You will find them in the never-never country, prospecting for minerals. You will find some of them following shearing, roaming the country in search of work, or in camps about railway lines in course of construction. These are the men whom we desire to encourage in habits of thrift, so that they will not be hard up when their job is finished. These men have no safe in which to lock up their bank books, and many of them are not of the highest education. Few of them are trained in business methods, and, although they may hide their pass-books, they cannot be very secure in a tent. We all know that there are a lot of harpies who follow all large camps, and are ever ready to take down honest men. These men may get hold of the passbook of a depositor so situated, and, if this regulation becomes law, they may be able, by a colorable imitation of, a depositor’s signature to an order, and getting that order cashed by a careless bank official, to make away with the whole of a man’s savings. If this is the way in which we are going to encourage the people to save, we can only expect disastrous results.
– Have there been many such disastrous results in connexion with the Queensland Savings Bank?
– The Vice-President of the Executive Council cannot cite a single instance of a bank having suffered an enormous loss by the absence of this protection. If we are going to protect the banks in every way, we shall only encourage carelessness on their part, and they may play ducks and drakes with the money of their depositors. We must never forget that a bank stands in the position of a trustee to its depositors, and that a bank will not be a success if its depositors have no confidence in it. If we are going to free the banks from all liability, the people will lose confidence in them.
– They have not done so in the case of banks that have this protection.
– They have had no alternative. Surely the honorable senator would not say that, because’ there was not a Labour party in Australia twenty-five years ago, there ought never to be one, or that, because slavery existed in many countries a little over a century ago, we should countenance slavery to-day? If this regulation be agreed to, a depositor who has been doing his level best to save money for his wife and family, and to provide for future needs, may, through no fault of his own, go to the bank one day, and find that all his savings have vanished. What sort of a position is that in which to place a man? We will not allow a private bank to enjoy this protection, and why should we give it to the Commonwealth Bank? The introduction of a general Banking Bill is contemplated before long, and I am perfectly certain that, when it is before us, Parliament will not recede from the position that it has already taken up. If that be so, let us have uniform banking legislation, which will apply to the Commonwealth Bank as well as to every other banking institution. Let us be willing to accept for ourselves that which we think good enough to prescribe for others.
– I have listened to-night to some startling arguments in defence of the regulation which it is proposed by this motion to disallow. I have endeavoured to see if by piecing them together I could make out something in the nature of a case in support of the action taken by the Government, but have absolutely failed to do so. The VicePresident of the Executive Council, in attempting to defend this regulation, discussed everything but its merits. He appealed first of all to party considerations, and then attempted an appeal to prejudice by pointing out that, the proposal submitted by- Senator St. Ledger real/y came from those who had opposed the establishment of the Commonwealth Savings Bank.
– Is that not correct?
– No; it is neither correct nor fair. Honorable senators on both sides dissented from the view taken by the Government on, a former occasion in regard to a proposal of ‘this kind ; and the merits of this proposition are not affected by the question of whether it comes from one side or the other. I despair of ever hearing the Vice-President of the Executive Council discuss anything on its merits when he has an opportunity to fall back upon an appeal to party or prejudice. One argument which has been emphasized by the Vice-President of the Executive Council in one form, and by Senator Symon in another, is the claim that depositors should be compelled to pay for the negligence of the bank. That is what this regulation really amounts to. There is nothing in it to differentiate between the negligence of a depositor and ‘ the negligence of the bank. Whether the negligence is chargeable to the one or the other, the cost is to be paid by the depositor alone. Senator Symon said, “ If we reject this regulation we shall hold out a placard that, no matter how careless a client may be, the bank will pay every time.” That seems a rather startling proposition; but if we reverse it it read’s that if we agree to this regulation we shall hold out a placard that, no matter how careless the bank may be, the client is to pay every time. Both propositions seem to be unfair, and a little absurd. To say that the bank should pay for the carelessness of its client is not one whit more ridiculous than to say that the client should pay for the carelessness of the bank. Each should pay for its own carelessness, and not for the carelessness of the other. A fair test of the proposal is to do what Senator Givens has been trying to do - to test it by its application to a private bank.
– There is a vast difference between an ordinary bank of issue and a savings bank. In the case of a bank of issue, a pass-book has not to be produced when withdrawing money.
– Senator McGregor has constantly been trying to persuade the people that a Government institution is superior to a private one. He now makes the pitiful admission that the Government Bank is so much inferior that it cannot afford to give to its depositors the same measure of fair play that is given by a private institution.
– We are not asking for this in connexion with the general business of the Commonwealth Bank.
– The honorable senator falls back upon the plea that this regulation applies to a savings bank in connexion with withdrawals for which a passbook must be presented. That practice has been insisted upon as a safeguard from time immemorial. But no one has attempted to show that that was the only safeguard which a Savings Bank could have. Senator Symon said that this is a Savings Bank, and not an ordinary bank. Well, we all know that. We knew that months ago, when we passed the Act. We were all aware that it was the intention of those who were responsible for the management of the bank to issue passbooks. We knew that depositors would have to present their pass-books when they paid in money or took it out. As for the pass-book, all I can say is that, having looked into this matter very closely, I utterly fail to see the reason for a proposal which compels a man who makes a deposit to present his pass-book when he does so. This pass-book fetish has got hold of Savings Bank officials to such an extent that they are not even prepared to examine into the necessity for it. They have come to regard the pass-book as both the foundation stone and the keystone of their whole system. They seem to think that they could not run a Savings Bank on any other lines. The only merit that I can discover in the system is, that it is a very old one; but it is’ new to me that honorable senators opposite, who are generally so ready to condemn a thing because of its antiquity, should on this occasion be so ready to defend this system simply because it is old. To show the great length to which honorable senators will go, I point out that Senator McGregor tried to persuade the Senate that if this regulation is allowed to stand, it does not necessarily follow that it will always be enforced. He held out visions of the grossest favoritism that I have ever heard of in connexion with any banking institution, public or private.
He said that if any depositor happened to lose the money deposited in the bank through fraud, it did not necessarily follow that the bank would abstain from making good that loss, but that it would be open to the bank to bear the loss if it liked. Are we to conclude, then, that the Minister seriously meant us to understand that there is to be one regulation for one set of depositors, and another regulation for another set, and that the bank is to ignore this particular regulation when it chooses? If so, let it go out to all Australia that this Commonwealth Savings Bank is not to be run according to any fixed business ideas, but is to be run according to the amount of favoritism a depositor can secure, and according to the amount of generosity which the management are prepared to display. That is truly an extraordinary doctrine for any one to put forward, and still more extraordinary to be espoused by a responsible Minister of the Crown.
As to the action of the Government in reference to this matter, I am forced to make reference to the remarks of Senator Symon. The honorable senator said that although the Senate struck out a specific clause in the Bank Bill, it left the power of regulation there, and that, consequently, it was competent for the Government to frame this particular regulation. We admit that it is legally competent for them to do so. Legal competency was never brought in question at all. The point is whether it is a right and proper thing for this Government, having accepted the view of the Senate when this measure was going through, to depart now absolutely from what Parliament decided. Senator Symon was so pressing with this argument as to the power of regulation being left at the command of the Government, and as to its being entitled to do what it has been doing, that I was forced to interject that, if that view be right, it follows that if the Senate reaffirms the position which it took up a few months ago and rejects this regulation, the Government will do a right and proper thing if it revives the regulation tomorrow. We can protest again and again, but the Government can re-introduce the regulation immediately. There ought to be some finality here. I make this concession to the Government - a word which ought to fall pleasantly on the ears of Senator Pearce - that if they had allowed the law passed by Parliament to come into working order, and then, after a few months’ experience had found that Parlia-
Senator Millen. ment had made a mistake, there might have been some justification for the Government in the light of that experience coming down to Parliament and saying : “ We tried to give effect to the will of Parliament, but we have found that the law is defective, and we have exercised the power that Parliament gave us to make good that defect.”
– We have had the ex1perience of the States’ Savings Banks.
– The Government had that experience when Parliament refused to give them this power. They have no more experience to-day than they had then. It is not merely that Parliament has taken certain action in this matter, but that the Prime Minister himself gave a promise which has been disregarded and lightly set aside by this regulation. I should like to remind Ministers, who seem to think that their occupation of the Ministerial bench justifies them in taking the most arbitrary action, that this particular proposal received as strong a condemnation at the hands of their supporters as it received at the hands of the opponents of the measure both in the Senate and in the House of Representatives. There was very strong opposition from the Government side of the House to the clause in question when the Bill was under consideration elsewhere. The opposition, in fact, was so strong that Mr. Fisher evidently began to see the wisdom of retreating from the attitude which he at first took up. Dr. Maloney, I am under the impression, is a supporter of this Government. He spoke very strongly against the clause in the House of Representatives. He followed Mr. Catts, Mr. Riley, and other speakers on the same side. After Dr. Maloney had been speaking some time, Mr. Fisher made an interjection saying -
If there is going to be so much fuss about the matter we will let the amendment go, though I am satisfied that it will weaken the operation of the Bill.
I pause to point out that Mr. Fisher by that interjection gave an assurance that rather than occupy time at that period of the session, he would let the amendment go. If he had not told the House that, honorable members would not have ceased from their opposition, and by rejecting the clause of the Bill in that House would have doubly affirmed the opposition to it. A little further on in the debate Mr. Fisher made this remark -
I thought that we might improve the position by adding the words “If it is proved that the depositor failed to take reasonable care of his pass-book.”
That was not an unreasonable suggestion. I referred just now to the possibility of devising a regulation that would throw upon the bank the responsibility in case of carelessness, whilst leaving upon depositors the responsibility for carelessness which could be avoided by them. That was what was in Mr. Fisher’s mind when he made the interjection. What has become of that suggestion now? Apparently it has been forgotten. He went on to say in another interjection -
Probably it would be well to let the matter go now and see how the Bill works. We can amend it afterwards if necessary.
That was, after they had experience of its working. These three interjections constitute a promise made by the Prime Minister; but what has become of that promise?
– We are carrying it out.
– The promise was to amend the Bill in the direction indicated, if that were shown to be necessary ; but there has, as yet, been no experience of the working of the bank, or anything which should have caused any decent Government to break their promise. The regulation, although in substance practically the same as that “ turned down “ by the Senate some months ago, contains a slight alteration in the language which seems to make it, in view of the decision of the Senate, even more arrogant. The regulation reads - in case any person presenting a depositor’s pass-book and producing a withdrawal form purporting to bear the signature of the depositor, or stating himself to be the depositor . . .
That is enough of the regulation to show that it has been drawn so as to leave an unfortunate depositor not the slightest loophole for escape, and that, no matter how careless the bank may be, not a shred of responsibility attaches to it. The bank has opportunity to check a signature, but no matter how clumsy a forgery may be, it is immaterial so” long as the same letters are written on the document. A depositor may write in a light feminine hand, and yet some clumsy, heavy-handed person may write the same name, and it will “purport” to be the same signature, and thus exonerate the bank. What position would Senator Barker, for instance, have taken up if a proposal of this kind had been made by a non-Labour Government - if it had been proposed to throw this shield over a private institution ? The night would not be long enough” to re echo back the denunciations of the honorable senator.
– Not if the proposal was just and fair.
– But Senator Barker would not then think the proposal just and fair.
– - How does the honorable senator know that?
– Because I have been two years in the Chamber with the honorable senator. I can only express my regret that, in a proposal of this kind, the Government have treated the Chamber and Parliament unfairly. The Government are also treating their followers unfairly, because they call upon them to ignore the position of the Chamber and make an unreasonable demand on their party loyalty. Any Government who had the slightest regard for their duty to the House, would have abstained from taking this action. It merely shows that no matter how serious the a( tion may be that the Government decide to take, they can at all times, by appealing to party loyalty, insure an acquittal on the most damaging charge. Whether or not the Government have done this with the full knowledge of Mr. Fisher’s promise, they have opened a new and unpleasant vista in parliamentary life. I should like to think that the action has been taken at the instance of the Governor of the bank without, possibly, Ministers giving the matter any serious consideration. I hope also that this is an oversight on the part of the Government, of a distinct promise by the Prime Minister.
– Say it is both.
– I should have no hesitation in saying so, if I thought it necessary, but it seems to me that the Government have to plead guilty to one or the other. They have acted unfairly to Parliament in trying to do by regulation what Parliament declined to sanction, and also in ignoring the promise given by Mr. Fisher - a promise which undoubtedly caused the debate in another place to terminate. It is not at all sufficient to say that this regulation has been recommended by the Governor of the bank. The probability is that Mr. Miller has been following the precedent set by other Savings Banks without looking too closely into it. Whatever may be said of Mr. Miller, he has had no experience of Savings Bank business, and, therefore, might be inclined to follow the steps already marked out by similar institutions. We must remember
.- This regulation is introduced in defiance of the Act of Parliament, and of the distinct determination on the part of the Senate.
– Show us anything in the Act that would disallow this regulation.
– This Chamber struck this provision out of the Bill, and yet we have it introduced by regulation. It is the duty of the Leader of the Senate to protect the Senate. It is an “ illbird that fouls its own nest,” and there is no doubt that the Senate’s nest is being fouled by such conduct. I have never yet, in my long parliamentary experience, seen a determination of a House of Parliament evaded in such a way. Apart from the merits of the case, it is the duty of the Leader of the Senate to support the previous decision of the Chamber. If it were found on experience that such a regulation was necessary, there is a proper way to introduce it. It has been clearly shown that no honorable senator opposite has supported the Government in their contention; and I hope that, on a division, they will act up to their convictions.
– So many aspects of the question have been raised that it is difficult to be brief. One of the most important points is that emphasized by Senator Millen, namely, that, no matter what may be .the decision of the Senate at this late hour, there is a distinct conflict between the assertion of the Prime Minister and the action of the Governor of the bank. The VicePresident of the Executive Council, in replying to my speech, at once introduced
– All those who voted against this before are on the same side tonight.
– If the proposal is going to be defeated-
– There is no danger of any defeat on this side.
– Although the whole weight of reasoning and argument has come fro-m-the other side of the House in support of my motion, reasoning is apparently to be put entirely on one side, because the Government know that at this late hour they have the numbers.
– What about Senator Symon’s speech?
– I was about to deal with it. There is a well-known saying that a man’s main enemies are those of his own household. Honorable senators opposite, and Senator Symon also, can apply that remark in any way they like. The honorable senator’s speech in extenuation of the Government must have fallen on the ears of honorable senators opposite like dew upon a desert. To me, his defence was to some extent amusing. His first plea was that we should not place the Commonwealth Savings Bank” in unfair competition with some of the State Savings Banks. He is not often here, but had he been present when the debate on the Commonwealth Bank Bill took place, he would have known that the regulations of almost every State Savings Bank were carefully considered in Committee. The Government, when seeking to pass the clause which the Senate rejected, pointed out that the State Savings Banks had a similar provision, and appealed to us to let” it go for that reason. Senator Symon’s . statement was therefore no news to us, although he probably thought he was discovering something new. Notwithstanding the fact that some of the State’ Savings Banks have that protection, the Senate deliberately rejected the clause. One of the most amusing statements made by the honorable senator was that about the danger signal which a precaution of this kind was, both to customers of the ordinary bank and depositors in the Savings Bank. If my memory serves me correctly I was the author of a similar, if not an identical phrase, when the Bills of Exchange Bill was under discussion in the Senate. A provision of this kind was sought to be included in the Bill, and I remember that I referred to it as a danger signal or a flag. Consciously or unconsciously, Senator Symon has to-night adopted my argument, and almost the very expression I used when the Bills of Exchange Bill was under consideration. The provision was rejected deliberately by the Senate on that occasion, and again when the matter was reconsidered in connexion with the Commonwealth Bank Bill. So that Senator Symon imported nothing fresh into the discussion when he repeated expressions which were used in dealing with a similar matter two or three years ago. In drawing a distinction between a Savings Bank and an ordinary bank, Senator Symon referred to the Savings Bank depositor’s pass-book as his “ title deed.” He said that it was his security, just as the possession of a title deed secures to a man his property, and if the Savings Bank depositor neglected to protect his bank pass-book, Senator Symon, in common with the Government, said, “ Let him go hang.” But the honorable senator, in comparing the Savings Bank depositor’s bank book with a title deed, forgot that title deeds are known to the legislation of all the States, and that in all the States there is such a thing as an assurance fund, from which, if the possessor of a title dee’d is deprived of his land or property through any negligence on the part of the Titles Office, and some other person is unlawfully registered as the owner of the land, he is given compensation. The analogy between a title deed and a Savings Bank depositor’s pass-book was an unfortunate one for a lawyer to draw. I do not pretend to the experience and keenness of Senator Symon ; but I take advantage of this, opportunity to turn the law against the honorable senator by reminding him that the possessor ot a. title deed is specially protected from fraud through any negligence on the part of the Titles Office by an assurance fund. I might carry the argument further, and say that the Parliament of the Commonwealth intended that the depositor’s passtook should be his title deed by providing that if there were any negligence on the part of the Commonwealth Savings Bank authorities they should make good any loss suffered by the depositor as the result of such negligence.
Sitting suspended from 12.15 to l a.m. (Thursday).
– It is perfectly true that honorable senators upon both sides of the Chamber have, at different times, expressed different opinions as to the extent to which the Commonwealth Bank should be protected, and the extent to which the funds of depositors should be safeguarded. Upon both occasions that this question has been discussed, the Senate has refused to declare the measure of protection which should be granted either to the bank or its depositors.
– We refused to declare that only upon one. occasion.
– We refused to declare it upon the Commonwealth Bank Bill, and we arrived at a similar decision on a kindred subject, upon a former occasion. We thought it better to allow the law to stand as it is, without in any way qualifying the decision given in the case of Marshall v, the Colonial Bant
Yet an attempt is now being made to define the law by means of regulation. Upon the face of it, that is dangerous legislation, and legislation contrary to the intention of Parliament. I again appeal to honorable senators to dissent from a regulation having the effect of legislation, seeing that both Houses of this Parliament have refused to legislate upon the subjectmatter of it affirmatively.
Question - That the motion be agreed to - put. The Senate divided.
Majority … … 3
Question so resolved in the negative. Senate adjourned at 1.11 a.m. (Thursday).
Cite as: Australia, Senate, Debates, 7 August 1912, viewed 22 October 2017, <http://historichansard.net/senate/1912/19120807_SENATE_4_65/>.