4th Parliament · 3rd Session
The President took the chair at 3 p.m., and read prayers.
MINISTERS laid upon the table the following papers : -
Census and Statistics Act 1905. - Regulation (Provisional) relating to Return of Trade Union Statistics. - Statutory Rules 1912, No. 227.
Defence Act 1903-1912. - Regulation Provisional) amended - Military Forces. - Statutory Rules 1912, No. 226.
Public Service Act 1902-1911. - Promotion of T. Gillin and Miss J. W. Thompson to position of Clerk, Fourth Class, Pensions Branch, Department of the Treasury, New South Wales.
Telegraphs and Telephones Special Works Account Act 1911. - Transfers dated 4th December, 191 2.
– In view of the motion of which the Vice-President of the Executive Council has given notice relative to a suspension of the Standing Orders governing a call of the Senate, will he consider the advisability of making a pronouncement as early as possible as to the date which he proposes to fix for the call ?
– I was anxious to see the Leader of the Opposition this morning to confer with him on that question, but I had in my mind Tuesday next as being the most suitable date for the call, and will give notice in time for that date.
– Tuesday will be the return day of the call?
– When will the notice be issued ?
– I hope to give notice to-morrow. “Later -
Motion (by Senator McGregor) agreed to -
That so much of standing order No. 278 as refers to a period of twenty-one days be suspended for the purpose of expediting the passage through their remaining stages of the Constitution Alteration (Trade -and Commerce) Bill, the Constitution Alteration (Corporations) Bill, the Constitution Alteration (Industrial Matters) Bill, the Constitution Alteration (Trusts) Bill, the Constitution Alteration (Nationalization of Monopolies) Bill, and the Constitution Alteration (Railway Disputes) Bill.
– I desire to inform the Senate that some time ago, owing to the limited accommodation at the disposal of the Naval Forces, the great number of recruits coming forward for the Navy, and the desire of the Government, and we believe also of the Parliament, that as many as possible of those manning the Fleet Unit should be Australians, we approached the Government of the United Kingdom with a request that the third class cruiser Pioneer, which it was proposed to recall to Great Britain, should be lent to the Government in the same way as the cruiser Encounter has been lent for training purposes. I am able to announce that to-day we received from the Government of the United Kingdom a cablegram making a free gift of the cruiser Pioneer to the Australian Government.
asked the Minister representing the Treasurer, upon notice -
– The answers to the honorable senator’s questions are -
asked the Minister representing the PostmasterGeneral, upon notice -
– The answers to the honorable senator’s questions are -
asked the Minister representing the Minister of External Affairs, upon notice -
– The answers to the honorable senator’s questions are -
The report for the year 1910 was printed and copies forwarded to various bodies interested in the work. Thirty-six copies were forwarded to the Clerk of the Senate on the 30th September, 1911, for distribution amongst the members of the Senate.
The report for the year 191 1 is now being printed.
Motion (by Senator McGregor) agreed to -
That standing order No. 67 be suspended for the remainder of the session for the purpose of enabling new business to be commenced after half-past ten o’clock at night.
Bill received from the House of Representatives; Standings Orders suspended; Bill (on motion by Senator McGregor) read a first time.
Bill received from the House of Representatives; Standing Orders suspended; Bill (on motion by Senator McGregor) read a first time.
Bill received from the House of Representatives; Standing Orders suspended; Bill (on motion by Senator McGregor) read a first time.
Bill received from the House of Representatives ; Standing Orders suspended ; Bill (on motion by Senator McGregor) read a first time.
Debate resumed from 6th December (vide page 6562), on motion by Senator McGregor -
That this Bill be now read a second time.
– - I desire to say a few words with regard to Senator Millen’s criticism of this Bill. He devoted particular attention to the fact that the Government were proposing to use loan money for the purchase of land for postoffice purposes, and he seemed to think that this proposal came into conflict with the declared Labour platform. The Labour platform lays it down that borrowing should be restricted, and the party have always said that they did not oppose borrowing for reproductive works. The honorable senator, speaking of the Bill, said -
It provides money for the purpose of purchasing an area of land for the purposes of a post-office site in Perth. We have been buying land for such purposes almost from the inception of Federation, but we have hitherto never resorted to borrowing. The lands have always been paid for out of revenue.
– That is a reproductive work.
– Why is this more» a reproductive work than were other land purchases made by other Governments and by this Government for precisely similar purposes?
I propose to show that this proposed purchase will be reproductive in a sense in which other land purchases could not be said to be reproductive -
The capital cost of the premises is, in round numbers, £166,400; .£153,000 provided by this Bill. When the whole capital cost has been paid, the charge for interest thereon may be taken at 3 per cent., making the annual charge for interest £4,980.
The present rents derived from leased properties amount to £9,500 per annum, and thus, on that basis (when the .land is paid for), the Commonwealth will be receiving £4,520 Per annum more from rents than the amount chargeable as interest on capital.
Assuming that the General Post Office will be built on the proposed site at once, it lilli not be necessary to disturb any leases for construction, but an expenditure of about £1,000 would be required to replace portions of premises.
The opening of the new road a year hence will, however, disturb several premises, the rent now received from which aggregates £3,215 per annum.
– Is any allowance made for compensation to tenants?
– No, because none of the tenants will be turned out. The tenants are now in possession of the front- ages to Murray-street and Wellingtonstreet, and it is not proposed to disturb them. The post-office is to be placed somewhere between Murray-street and Wellingtonstreet, and a new street is to be opened up between the two streets. In the construction of this new street some of the tenants will be disturbed -
If only such disturbance is effected as is necessary to make the new road (but without disturbing property on the south-east of that road) the situation when the General Post Office is completed will be -
But the Commonwealth would then be relieved of an annual payment of£2,625 for the present General Post Office, valued at£75,000. The Commonwealth would also receive rents on undisturbed properties yielding, at present rates (which, however, will increase with improvement to locality), , £6,285 per aniium. Thus the situation would be -
1 he proposal is, however, that the Commonwealth, after opening the new road, will, in 1915, terminate all leases to the south-east of that road. The further reduction of rents (therefrom) will be ; £1,080 per annum.
The Commonwealth would, however, then have at its disposal frontages of 74 feet to Murraystreet, 300 feet to the new road, and 74 feet to Wellington-street. The rentals for those frontages are estimated at£3,500 per annum ; thus the Commonwealth would lose the existing rentals of £1,080 per annum, and re-let for £3,500 per annum, or an increased revenue of £2,420 per annum. The situation would be : -
It will thus be seen that, as far as the honorable senator’s references to this work are concerned, it is an easy matter to demonstrate that it will be absolutely reproductive work.
– -You cannot get money at 3 per cent, to-day.
– That remains to be seen.
– One per cent, is not enough to allow for depreciation on buildings..
– Even if½ per cent, is added to the interest charge, the work will still be reproductive. The honorable senator, on finding that the Labour platform did not help him, because it did not bind us to oppose borrowing, had recourse to cutting out portions of speeches made by members of the Labour party, stripping them of their context, and, irrespective of the subjects to which they referred, applying them to this subject as if they were made on proposals such as those set out in this Bill. He quoted the Prime Minister as having said -
They are not justified in altering the policy of the country because they find themselves in financial difficulties. If that were permissible, then, I presume, responsible government, as we understand it, would be at an end. The fact that the electors confirmed the action of the Parliament in 1902 in refusing to adopt a borrowing policy was a direction to all Com- monwealth Ministries that the settled policy of the Commonwealth should be to abstain from borrowing until a contrary direction had been given by the people.
Now let us look at the position to which these remarks apply. They referred to the Loan Bill introduced by Sir George Turner in . 1902. The proposal to borrow was made at a time when the Commonwealth Government had a surplus revenue. The surplus in the financial year 1901-2 was£888,741. This was the amount available to be paid over to the States in excess of the three-fourths of the Customs and Excise revenue to which they were entitled.
– The Minister is making no allowance for the interest on the transferred properties to which the States were entitled.
– That would not have represented more than one-fourth of the total amount.
– But that amount should be deducted ‘before any excess is taken into account.
- Sir George Turner’s proposal was brought in at a time when we were returning to the States, . on the average. £1,000,000 per annum in excess of the
Customs and Excise revenue to -which they were entitled. Here is Sir George Turner’s proposal -
Practically, a blank cheque was to be given, and the Government were to be authorized to spend money on any kind of work - defence works, postal works, or land resumption.
– A schedule was given indicating that a great deal of postal work had to be carried out.
–If the honorable senator will look at the Bill he will find that it has no schedule.
– Particulars were given by Sir George Turner when introducing the Bill.
– Later on, when the Budget was submitted, members of the House of Representatives found that certain works had been excluded from the ordinary Works Estimates, because it was intended to provide for them by means of this Loan Bill, and .when that position was put to Sir George Turner, he defended his action by pointing out that several of the States had deficiencies, and he actually proposed that the Commonwealth Government should borrow money so that they might return a larger amount to the States, and save them from having deficiencies. That was the proposition to which the Prime Minister took exception, and any honorable senator on this side of the House would attack a proposal of that kind. Senator Millen said -
It seems that it was entirely wrong foi Sir George Turner to borrow for postal works, but that it is entirely right for Mr. Fisher to borrow for the same thing. Mr. Fisher went on to say - “ I hold the strongest views on this question, and am in no doubt regarding my own position as to the wisdom of a non-borrowing policy-. We took a wise step in refusing to borrow in the early days of Federation, and I hope that we shall continue to do so.”
These remarks were made in connexion with the second loan proposal of the Commonwealth Government - the Government of which the honorable senator was a member. A Naval Loan Bill was introduced in 1909, and the Prime Minister’s remarks had reference to that measure. There is absolutely no comparison between proposals such as that referred to by Mr. Fisher and the present proposal, because they were in no way reproductive. Senator Millen quoted Mr. Thomas as saying, on the 30th November, 1909 -
There is something to be said for the policy of raising money by loans to provide for reproductive works, although, personally, I am opposed to such a policy.
Mr. Thomas also said ; “ So soon as a loan policy is initiated in connexion with the construction of reproductive works, there sets in a certain measure of extravagance.”
Mr. Thomas’ statement there is again made on the Naval Loan Bill, and in what position do we find the Government was in then? On the 30th June, 1908, there was a surplus of .?330,000, and in November, a few short months after that surplus was declared, they, brought in a loan proposal for ?3,500,000 for absolutely unproductive works.
– Did Mr. Thomas proclaim himself as opposed to borrowing, even for reproductive works?
– Yes, .he did. Speaking for myself, I would have been opposed at that time to a Loan Bill, even for reproductive works. I should have said to the Government, “ The financial year has just closed with a surplus of ?330,000. Where is your justification for going on the money market to borrow when you have a buoyant revenue and a surplus to play with?” The position now is that there is no surplus for the present year, that these are necessary works as well as reproductive works, and therefore the Government are justified in doing what we would not have been justified in doing had we a surplus.
– Does the Minister say there was a surplus then?
– There was a surplus on the 30th June, a few months before that statement was made.
– The honorable senator said that when we left office there was a deficit.
– There was after you had been in office long enough. Then Senator Millen quoted the following statement by Mr. Watson -
As far as I am concerned, any proposal for loan expenditure, unless the occasion be urgent, and unless the purpose be very important indeed, will meet with strenuous opposition. Every effort that I can put forth to prevent Australia in engaging upon a borrowing policy will be put forth upon this and every other occasion when I have the opportunity in Parliament. There is always a much greater disposition to be careless about expenditure when we have not to bother ourselves about taxation in the meantime.
Let us look at the circumstances under which Mr. Watson made that statement. I have already stated that on the 30th June, 1908, there was a surplus of ?330,000. Mr. Watson made those remarks when speaking on the Budget in August, 1907, and was replying to an interjection made during his criticism of Sir John Forrest’s proposal to extend the Braddon section. The interjection was made by. Mr. Poynton, “ We are paying for public works out of revenue”; and following that interjection Mr. Watson made those remarks. We have to remember that the Commonwealth policy enunciated by Sir John Forrest was to extend the Braddon section, and to continue to pay the States after the ten-year period three- fourths of the Customs revenue. Mr. Watson, speaking with the knowledge that we had already disposed of one proposal to borrow for the benefit of the States, was pointing out that already under the Braddon section the Commonwealth had scarcely sufficient revenue in the coming year to meet its liabilities. He pointed out what would happen if Sir John Forrest’s proposal was indorsed - that the Commonwealth would be forced to take up a general borrowing policy for all its public works. He was urging that there should be a revision of the Braddon section, and he made those remarks in order to show the people of Australia that if the Braddon section were extended, the Commonwealth would have no resort but to take up a general borrowing policy, and so he voiced his hostility to a borrowing policy.
– To any borrowing policy, especially for such works as the Northern Territory Railway.
– You cannot take remarks like that without due regard to the situation which was then being dealt with. Senator Millen further quoted Mr. Watson -
While the right honorable gentleman - [referring to Sir John Forrest] - was out of the chamber, I said that, although he seemed to appreciate the immense obligations which confront Australia from a national stand-point, he altogether failed to explain how he proposed the money should be raised to carry out those great projects consistently with his proposal to extend the Braddon clause.
I would point out that the entire position is varied by the fact that the Braddon section was not extended -
Sir John Forrest. Which project?
Mr. WATSON. ; The opening up of the Northern Territory, provision of an adequate local defence, and railways - to the west and the north.
Sir John Forrest. Carry them out by means of loan money.
Mr. WATSON.; Certainly good old policy of borrow and burst. Let us get back to loans, the never failing resource of the spendthrift politician.
– T am so glad you quoted that.
– I never intended to leave it out, because it is so pertinent to the point at issue, and that is, that the whole of Mr. Watson’s remarks were directed’ towards the impossibility of continuing the Braddon section, and that the consequence of continuing it would be that the Commonwealth must take up a general borrowing policy. He instanced particular works, including defence, to show that if the Braddon section were continued those works would have to be provided for out of loan. Again, on the 30th December, 1902, Mr. Watson made these remarks -
I maintain that the pay for the various necessary works out of loans is against the best interests of the people. In my view, loans always lead to false notions as to the value of economy.
Those remarks were made on the Supply Bill. The surplus at the end of June, 1903, was ?1,145,234, and yet the proposal at that time was that we should borrow . *
– For necessary works.
– The only justification given for borrowing was to increase the amount which would be handed back to the States. There was ample money for all the works required by the Commonwealth, and the Commonwealth is suffering to-day, and has been suffering for years, from the policy which Sir George Turner and his Government carried out of handing back those huge surpluses to the States, instead of’ spending them on the post-offices. Senator Millen referred to what the State Government in his own State had done. In that I do not propose to follow him at all. I have no doubt there is a complete reply to everything that he said in regard to the New South Wales Government, but I do not think it is the province of this Chamber to discuss that. Senator Millen said -
Western Australia has ever borrowed for roads and bridges, and in answer I say that I have shown that there was never a Loan Bill introduced in any part of Australia for such an unwarrantable purpose as the purpose for which this Bill has been introduced.
I have already shown that so far as the returns from the postal lands in Perth are concerned, we show not only a return of interest, but also a profit. We shall ultimately require much of that land, and we should be foolish to buy a small piece of land in a rising city like that, and afterwards be compelled to acquire other land at an enormous cost.
– Why do you not do that in every other city of the Commonwealth ?
– We would if we could. I do not know that there is not good justification for doing that in the capital of the honorable senator’s own State. Now I come to another proposal in the Bill, and that is to borrow £375,000 to redeem loans on the Northern Territory and the Port Augusta railway. Those loans carry interest at the present time at the rate of £3 12s. 3d. per cent. Under this Bill the Commonwealth will pay 3J per cent, on the money raised.
– The Minister will recollect that I advanced no opposition to that portion of the Bill.
– The honorable senator advanced a sweeping charge against the whole Bill; he never qualified it. I Shall quote the senator’s own words -
I have shown that there never was a Loan Bill introduced in any part of Australia for such an unwarranted purpose as the purpose for which this Bill has been introduced.
The saving on those two loans will be 2s. 3d. per cent.
– When do those loans fall due?
– I cannot say offhand. If the honorable senator will refer to the Budget he will find when they fall due.
– I have looked at the Budget, and I cannot find it there.
– The saving on those particular loans of .£375,000 is £420 per annum. It is only a small amount, but capitalized it reaches a pretty substantial amount, and at any rate it is a saving. I ask Senator Millen, how many of the States have effected a saving by the redemption of their loans”? The honorable senator will find that on very few redemptions has a saving Been effected. Senator Millen further stated -
The facts are that, so far as Labour Governments are concerned, there has been more money lent to them by the people of Australia than to all the other Governments put together.
I asked Mr. Knibbs, the Government Statist, to supply me with the figures, and he has furnished me with the following particulars. It is headed Particulars of loans by State Governments during last three years. Figures have been taken from the last three annual statements made by the respective State Treasurers referring to loans floated in the financial years 1909-10, 1910-11, and 1.911-12.” The following are the particulars : - Labour Governments, 1909-10, not in power; 1910-11, New South Wales, £6,331,713; 1911-12, New South Wales, ,£4,864,634; Western Australia, £2,587,070; South Australia, no loan floated, but sales of stock and Treasury Bills were made at the Treasury from day to day. Other Governments : 1909-10, New South Wales, £10,723,523.
– Were those renewals?
– They are loans. I am dealing with the honorable senator’s general statement as to borrowing.
– Is the honorable senator dealing with loans floated or loans redeemed ?
– I am dealing with loans floated during the year 1909-10, and I am replying to the honorable senator’s statement that more money had been borrowed by Labour Governments than by all other Governments put together.
– I repeat the statement.
– The honorable senator is a very bold man in view of these figures.
– They do not include loans drawn from Savings Bank deposits.
– Why did not* the honorable senator say so on Friday? He never made any qualification of his general statement.
– I make the statement now.
– It is rather belated. I am dealing with the statement made on Friday, and which went into Hansard. In the same year, 1909-10, Victoria borrowed £594,658; Queensland, £10,301; South Australia, £2,101,612 ; Western Australia, £1,342,000; Tasmania, £689,449. Total for all States under Liberal Governments, ?15,461,543. In 1910-11, the figures are - New South Wales, ?400; Victoria, ?3.907.3i4-
– Does the honorable senator say that New South Wales only borrowed ?400 in that year?
– No; the Labour Government only borrowed that sum. Queensland borrowed ?305,800: Western Australia. ?650,000; Tasmania, ?756.584Total for all States. ?5,620,098. In 1911-12, the figures are: Victoria, ?3.497; 168 ; Queensland, ?977,809; South Australia, no loan floated, but sales of stock and Treasury bills were made at Treasury from day to day; Tasmania, ?850,992. Total, ‘all States, ?5,325.969The total borrowed during the last three years by Labour Governments was ?13,783,417; by Liberal Governments, ?26.407,500, or twice as much.
– Those figures are absolutely incomplete.
– They are the figures given to me by Mr. Knibbs, the Commonwealth Statistician, as to the borrowing of the respective States during those years.
– If the honorable senator wants the truth, he can ascertain it from the Statistician.
– Does the honorable senator mean to say that I asked the Statistician to supply me with something that was not the truth ? I have given the loans floated, and it was to them that the honorable senator referred. If he was not including money borrowed from the Savings Banks, why did he not say so? The object of his remark was to give the people outside the impression that his figures. related to money borrowed by Labour Governments.
– I will repeat the statement outside and- justify it.
– Dealing with borrowing for the purpose of lands, Senator Millen attempted to make the people believe that because borrowing has been resorted to for the purpose of purchasing this particular piece of land in Perth, it was intended to borrow for all lands required for post-office sites. But I only need to point out that this site has been dealt with in a particular way because there are particular features about it. It is not proposed, nor has it ever been suggested, by the Government that we should borrow for post-office sites throughout the Commonwealth.
– Why this one, then?
– The honorable senator quoted Mr. Knibbs - to whom, it appears, he has resort for information when it suits him - to the following effect: -
The Trust Funds have at various times enabled several State Treasurers to tide over awkward financial positions, but the propriety of allowing deficits to be frequently liquidated in this manner is worthy of very serious consideration.
Upon that Senator Millen commented -
I need only to alter one word of that quotation. The Trust Fund is to-day being used by the Commonwealth Treasurer to tide over an awkward financial position.
The Vice-President of the Executive Council interjected -
Would the honorable senator put the money in a box and keep it there uninvested?
Senator Millen said ;
No. I should not do anything of the kind. I may ask Senator McGregor whether the Government are using these funds for the purpose of earning interest. If so, they could get interest from the State Governments or from the banks. They are not bound to buy a block of land in Perth in order to find an investment for these funds.
What was the honorable senator’s purpose in making that observation? Was it not to make the people believe that there was some danger in the proposal made by this Bill - that, in some way, we were going to make an illicit use of the Trust Fund? Otherwise, what was the object of the quotation from Mr. Knibbs? The passage quoted referred to the State Treasurers, who had at times seized Trust Funds ear-marked for specific purposes.
– As yours are.
– What is the bank notes trust account ear-marked for? It is ear-marked, of course, for a specific purpose. But let us see what that purpose is. Section 8 of the Australian Notes Act reads as follows : -
Part of the moneys standing to the credit of the Australian Notes Account shall be held by the Treasurer in gold coin for the purposes of the reserve provided for in section g of this Act, and the Treasurer may invest the remainder or any part thereof.
What this Bill proposes is that money shall be invested for the specific purpose set out in the schedule. Where is there anything illicit in that? The law provides for it, and was designed for that very purpose. It was always understood that the money would be used for such purposes.
– Does the Minister say that this amount will come out of the notes issue reserve?
– It will come out of any Trust Fund which it is desired to make earn interest. But Senator Millen endeavoured to make out that some illicit use was to be made of the Trust Fund. He quoted the Fleet Trust Account, and pointed out what would happen when we wanted money for naval purposes. He said that the money would have been invested, and would not be available for those purposes. Nothing of the sort can happen, or will happen. Nothing of the sort is intended to happen, because we have ample money in the Australian Notes Account for meeting the demands upon us when due, and no further proposal for borrowing for that purpose will be necessary.
– By depleting the reserve.
– No; not only is there a balance to the credit of the Australian Notes Account, but the moneys lent to the States are lent on short-dated loans, which will come back to the Commonwealth Treasury long before the purposes for which the other Trust Accounts are allocated will require the money in them to be used. Senator Millen also said -
As the Government are lending their trust money at 3^ per cent., and the New South Wales Government cannot borrow under 4 per cent., I am entitled to say that it is foolish, in dealing with this transaction, to estimate that the interest will be ‘ less than the lower of those sums.
The honorable senator was not accurate even there. As a matter of fact, the rate of interest obtained by the Commonwealth on loans to the States is not $ per cent., but £3 8s. per cent.
– The Government lent that money some time ago, when money was cheaper than it is to-day.
– When the honorable senator was dealing’ with facts, he might as well have given facts; and he did not say that he was dealing with the money which the Government are now lending. He said that we had lent money at 3J per cent. It is not so.
– The £3 8s. per cent, is the average. The last loan was at 3^ per cent.
– The honorable senator went on to say -
A further sum of £750,000 is needed in connexion with loans floated by South Australia, which will mature during the next three years. These commitments, .which total nearly £10,000,000, we shall have to face during the next few years, and the most with which we shall have to meet them is the £7,000,000 provided by the notes issue.
There the honorable senator was trying to make out a case to the effect that we shall be committed by this Loan Bill to a general loan policy. On that point, I only wish to say that if the worst comes to the worst - if we have to redeem these loans, as the honorable senator indicated, by further borrowing - provided that we can always do what we have done in this case, we shall have made a good bargain for the Commonwealth. If we can always effect a saving of J per cent, interest we shall have done good business, and, so far from being blamed for that, we ought to be commended. I have nothing more to say on this Loan Bill, except to add that the two vital points relate to the post-office in Perth and the redemption of loans in the Northern Territory. As to both of them, I have shown that the Commonwealth makes a profit by the transaction, and benefits considerably ; and that so far as the honorable senator’s sweeping statement goes with respect to the borrowing of Labour Governments compared with Liberal Governments, it is clear that Liberal Governments have borrowed twice as much as Labour Governments in the same time.
– There has been a great deal of discussion as to what has been in the past and what is now the policy of the Labour party with regard to borrowing. I have always understood that the idea of the Labour party since I became connected with it twenty years ago was that ultimately borrowing should be entirely stopped. But that does not mean that immediately the Labour party got into power an end would be put to borrowing. A change of a system that had been in vogue for a considerable period could not be effected suddenly. Therefore, if honorable senators of the Opposition hoped that immediately the Labour party got into power an end would be put to borrowing, they were likely to be disappointed. But during the period of the Labour Government in the Federal Parliament the ideal of the Labour party with regard to borrowing has been practically carried out. Hitherto the Government has constructed all its public works out of revenue. Large areas of land have been bought out of revenue. The Fleet, so far as it has been advanced, and defence generally, have been paid for out of revenue. So that in regard to those matters the Labour party has carried out the original ideal with regard to non-borrowing. I say at once that personally I do not believe in borrowing. My idea is that some method of constructing public works can, and ought to, be devised without resort to this method. But, as I have already said, this cannot take place suddenly. It can be accomplished only by slow degrees. T. think that every reformer, whether he belongs to the Labour party or any other party, should always keep before him some objective; and the idea that I have in my mind is this : ‘At the present moment huge sums are going to waste, and are being poured into the pockets of private individuals, which ought to go into the public Treasury. 1 am referring now, of course, to community-created values. The objective which I believe every financial re- former who belongs to the Labour party has in view is that ultimately those values shall go into the public Treasury, where they of right belong. Before that day conies many a hard battle will have to be fought, many a bridge and railway will have to be built, and many a trouble met. But that is the financial objective which every Labour man should keep continually before him. The Federal Labour party has. never lost sight of its original ideal. Borrowing has been , restricted most severely. We have heard no end of complaints from members of the Opposition that money has not been borrowed for the building of a Fleet, the construction of Defence works, the erection of public buildings, and a number of other things which the Federal Labour Government have paid for out of revenue.
– The Opposition would borrow to build rainbows.
– [ believe that they would. I do not conceive that I am capable of doing this question the justice it deserves, but I invite honorable members to consider the system as it at present exists. In every country of which we have any knowledge there is annually a large accumulation of wealth, 95 per cent, of which passes into the pockets of a very limited section of the people. The money has to be reinvested. It is extorted in the first place from the people in the shape of community-created values, rent, interest, and profits, and is again loaned back to the people. There is thus constituted a perpetual burden upon them. First of all, the money that belongs to the people is practically stolen from them, as it is in Australia, in the shape of communitycreated values. Then this stolen money is loaned back to the people from whom it has been taken, and the system keeps them in a condition of perpetual servitude and poverty.
– It is out of the unearned increment, if it could be got, that the honorable senator would construct public works ?
– Undoubtedly, that is what I should do. I wish members of the Opposition and of the party with which I am connected to understand that I am not now speaking as one responsible for the Labour party, but am giving merely my own ideas. The policy of the Labour party is the restriction of borrowing. I agree with that policy because it is not possible at once to completely abandon all borrowing.
– The honorable senator will admit that it is not unreasonable that, side by side with the party’s platform, we should read the declarations of its leading statesmen.
– I do not care two straws for its leading statesmen. I do not care who they are, what they are, or what they say. I take the public platform of the party as my guide, philosopher, and friend. I signed that document, and so long as I remain a member of the Labour party I intend to abide by it.
– Is the honorable senator not bound by what he tells the electors from the public platform?
– I never tell the electors anything upon which I care to go back. I am always perfectly honest with them. Possibly that accounts for the confidence which apparently they place in me. I do not go before the electors with my tongue in my cheek, as no doubt a number of honorable senators do. I tell them the straight-out truth.
– And, thank God, rhat you are not as other men are!
– I am a Pharisee, of course. In any case, I am as honest as I can be with the electors and with myself. In passing, let me say that it seems to be impossible to please the Opposition. Whether we borrow or do not borrow, they howl at us. That is, no doubt, quite natural and proper from a party government point of view. But if we have gone astray in connexion with this question of borrowing, the Opposition should be pleased, because to borrow is the height, depth, length, and breadth of their policy. They want to borrow for everything. They would borrow even to construct rainbows, as the VicePresident of the Executive Council put it just now. They have no idea of finance other than to buttress financial institutions, and people generally, who have money to lend. The idea of the Labour party, and my own personal idea, is that we should get out of the hands of the pawnbrokers. There is no reason under Heaven why we should be running continually cap-in-hand to Cohen to borrow our own money back again. This is a very important matter, in view of the way in which it concerns the welfare of the people. We should have definite ideas upon it, and should keep our minds fixed upon the ultimate objective all the time. The ultimate objective of the Labour party is to do away with the necessity of borrowing. If the Labour party abandons that idea, in my humble opinion it will be taking a wrong course. So far I have seen no evidence of such an abandonment. The Federal Labour party has a particularly good record in this connexion. It is only now, when no other funds are available, and for a very necessary purpose, that it embarks upon a borrowing policy. In Senator Millen’s most excellent speech, from a purely Opposition point of view, he tried to show that the Government was not only going back upon its own policy with regard to borrowing for a piece of ground and buildings- upon it in Perth, but was also making a very bad bargain. One objection he urged was that they were buying more land than they needed. Probably we are buying more land than is needed for present requirements, but Senator Millen knows as well as any other man in the Federal Parliament, or out of it, that Australia is yet only a child in swaddling clothes, and that probably within half-a-century every inch of the ground which has been purchased by the Government for a post-office in Perth will be required for public buildings. It will be required in a very .short period proportionately to the life of the nation. I think that it is exceedingly good business on the part of the Government to make provision in this matter for future expansion. In other capitals, where extensions of post-offices and other public buildings have become necessary, the various Governments have had to go upon the market and buy land and buildings at prices which were very much above their real value. In my view the Federal Government and the Minister mainly responsible for this transaction have done exceedingly well, and I wish that something of the same kind could be done in every capital throughout Australia.
– It is a good business deal for the taxpayers.
– Undoubtedly it is. It will pay for itself in the meantime, and may save millions sterling to some future generation. I know what the Leader of the Opposition and honorable senators allied with him would like,. They would like the Federal -Government to pursue the old policy, and secure the little piece of land necessary for present requirements in order that in a few years we should be compelled to buy from some private individual owning the adjacent land, who may have the ear of the Government of the day, at a price very much in excess of its true value for the property then required.
– Why not “ the ear of the Government of tha day “ with regard to this deal?
– I think that the evidence that no one has the ear of the Government with regard to this deal is on the face of the deal itself.
– Why suggest it in the future ?
– I have seen the thing done in connexion with other Governments.
– My trouble is that I cannot see this.
– This particular transaction might be a bad one. The honorable senator may see further into a milestone than I can, but on the face of it I say that this is a really good piece ->f business. The land and buildings .h.mcost £160,000. The buildings which will not at present be required by the Government are tenanted, and likely to be tenanted until the Government require them. The rental is about £”10,000 a year. Senator Pearce estimated the interest at 3i per cent., I think.
– No, at 3 per cent.
– That is too low at the present time. I put the interest on the capital invested at 4 per cent., which would amount to between £6,000 and £7,000. So that there is a clear margin of, say, £3,000.
– The honorable senator is overlooking some facts which the Department itself has supplied. There is an amount of £500 a year for maintenance of the leased buildings. Over £160 per annum is payable as rates to’ the municipality of Perth, and there is a factor known as depreciation, which is important in the case of comparatively old buildings.
– I was going to refer to all those factors, but taking them all into consideration the Government are still in a fairly good position, since they will lose nothing by the deal.
– And the value of the property is increasing all the time.
– As Senator Guthrie rightly interjects, the value of the property will be increasing all the time. If some new gold-fields are discovered in the West, as we all hope will be the case in the very near future, these values, instead of increasing slowly, will go up by leaps and bounds, and probably in the course of ten or twenty years what has been bought for about £170,000, may be worth £1.000,000, or more. But this is a matter of detail. I desired chiefly to refer to the suggestion that the Labour party . had abandoned its policy of no borrowing. It has not done anything of the kind, but like every other human institution it is the victim of circumstances. It finds itself confronted with evil conditions, which can only be swept away by time and patience and as opportunity presents itself. But I believe that the ideal of the Labour party with regard to borrowing is now what it was at the beginning.’ We see that if the community-created land values were paid into the public Treasury, as they ought to be, and not to private individuals, as they are, they would of themselves be sufficient to build the necessary public works - railways, public buildings, roads, and bridges - throughout the Commonwealth. If honorable senators will take the land values throughout Australia, and allow 5 per cent, thereon, they will find that the position I am taking up is one which is not very far from the truth. Of course I, with other members of the Senate, realize fully that the day of the complete consummation of this policy has not’ yet arrived, probably will not arrive for many years. But that the Federal Labour party and the Labour Government have kept to the original policy with regard to borrowing has, I think, been amply proved by the conduct of both the party and the Government since they came into power in Australia.
– We have heard two interesting speeches on the loan policy from two distinguished members of the Government. It was quite patent to the ears of anybody, and it was exactly so intended by the Minister of Defence, that his speech should be read and taken as an apology - an apology by comparison with the past, and, through that apology, an apologetic justification for the difficult and inconsistent position in which the Government now find themselves. He began with an apology, and his. speech was an apology throughout, and a member of the party has just ended a speech with a complete repudiation. They can reconcile their position to the Senate, and also to the supporters of the Labour party.
– How can you call Senator Stewart’s speech a repudiation?
– Because Senator Stewart pointed out, if I understood him properly - and I think he intended to convey it - that if the financial plank of the Labour platform were carried out as it was originally intended, there would be no borrowing at all. He has gone further, and pointed out that if the idea of paying for public works out of the unearned increment of the community - which, according to him, is easily available - were realized, there would be no necessity for any loan or borrowing policy. I think that there is no man in the Labour party in Australia to-day who is so familiar with the platform, and has been so strongly insistent on that financial plank as the basis of the financial policy of the party, as has Senator Stewart, and when we have the head of the party apologizing for the policy, and a strong supporter like Senator Stewart repudiating it practically in its entirety, the only conclusion which the Opposition and the general public can come to is that they really do not understand what their policy means, or, if they do, that they do not intend to carry it out.
– Who is apologizing for the policy?
– Do you not think that the correct explanation is that every man is at liberty to interpret it, and to vary the interpretation according to times and circumstances.
– Exactly ; and now we have had a version from the Minister of Defence, as I shall show from his speech. After the handling which it has received from Senator Millen, Hansard ought to be burned. The Labour party, as well as the Liberal party, has got itself into the position in which it raids it must borrow. Circumstances have so developed - and they have developed as part of a deliberate policy on the part of the Labour party - that they must either repudiate their policy in regard to railway development in the Commonwealth or repudiate borrowing. It cannot be carried out without borrowing. Fortunately for us, Hansard remains to prove irrefutably that originally when the Labour parly came into this Parliament the thing on which perhaps they prided themselves more than anything else was their repudiation of a borrowing policy. At the first opportunity they got here they repudiated it, and forced a Treasurer, who, unfortunately, was not strong enough to resist the pressure brought upon him, to withdraw his borrowing proposals, and fall back upon revenue.
– And he was prepared to eat dirt.
– I do not say “ to eat dirt,,J because I think that there is such a thing as political necessity and political expediency.
– That is what Sir John Forrest did, at any rate.
– What is this loan policy now but a policy of expediency, which in itself is a complete departure from that hard and fast rule of no borrowing?
– Can you point to a plank in the Labour platform which forbids borrowing ?
– I am entitled to look at the plank in the light of the interpretation which Senator Stewart has given to it.
– And he deliberately said that it was his own.
– And, more than that, I think that on finance and many other matters Senator Stewart is just as able and lucid an exponent of the Labour platform and policy from his point of view as he is from the other. There is such a thing as expediency. The reference by
Senator Millen to the declaration of Mr. J. C. Watson with regard to borrowing makes that point amply clear. On the 27th August, 1907, Mr. Watson said -
As far as I am concerned any proposal for loan expenditure -
By the use of the word “ any,” he was negativing “ all “ proposals for borrowing. I wish to emphasize his words. “ As far as I am concerned,” he said, “ any proposal for loan expenditure will meet with strenuous opposition “ - he was opposed universally to borrowing. But mark the conclusion of his statement. It shows exactly what he intended when he expressed his opposition to “ any “ proposal for loan expenditure.
– At that time.
– I am going to deal with that time. Let us take his statement as he made it.
– And not as they want to tone it down now.
– Exactly. The context will show that my honorable friends opposite cannot tone it down. The Minister of Defence tried to explain it away, but it is inexplicable in the fact of the clear, simple language of Mr. Watson. And his clear and simple intention could not be clearer or more emphatic than the words themselves - yes, there is one thing which is clearer and more emphatic than the words themselves, and that is the- context in which they are used. He said -
As far as I am concerned any proposal” of loan expenditure, unless the occasion be urgent, and unless the purpose be very important indeed, will meet with strenuous opposition.
In other words, any proposal for loan expenditure will meet with strenuous opposition. That is what the words are ; that is what the words mean.
– The strenuous opposition was not threatened to that proposal,, but to “any” proposal.
– To “ any “ proposal. To use a term in logic it was universal. What do the words, unless the occasion be urgent, mean. It is thoroughly understood that a National Government might be confronted with an emergency - with war or preparations for war - which everybody, even the strongest and’ staunchest Labour member supporting the principle of unearned increment, as put forward by Senator Stewart, would hold, and very properly hold, that this principle should be relaxed.
– It is not merely a case of relaxing, but a case of hurrying to get it where you can.
– Let my honorable friend read Mr. Watson’s words with that qualifying context. It is clear that what he meant was that a national emergency - a war or preparations for war, or some financial emergency such as the States were confronted with in 1893 - might require a modification of the broad principle. But the broad principle he had first laid down universally. It is clear from the words and the context, taken together, that his meaning was that there should be no borrowing for public works expenditure, but that the money should come out of the general revenue. On that line of argument, and with that explanation, it is clear that Mr. Watson boldly informed Parliament what was the loan policy of the Labour party until this Government came into power. What is the explanation given by the Minister of Defence? He has stated that the reason why the Labour party opposed the proposal of Sir George Turner at that time was that the Commonwealth Government were returning an average of £880,000 a year to the States. It would be absurd and unjust, he practically contends, when they were handing back , £880,000 a year to the States, to go into the open market and borrow money for public works. But the argument cuts both ways. When the revenues were small, possibly there was more justification for it; but there ought to be no justification, in a case where the Commonwealth get a revenue of £22,000,000 odd. When the . Commonwealth Government had control of only a comparatively small amount for carrying out urgent matters, and were returning, as they were bound to do under section 87, a certain amount of revenue to the States, one could understand why the Treasurer could use that as an argument not for tightening up the States any further, or for tightening up himself, or for going into the open market either in Australia or outside.
– That does not answer the position of paying away unnecessarily the surplus of the one-fourth share which he could keep, and then borrowing.
– My point is that with a revenue of £22,000,000 odd to deal with, the Government ought not to have to borrow in order to aid their revenue. It is inconsistent, and worse than inconsistent, to make a charge against a former Treasurer, who had only £6,000,000 or £7,000,000 to carry out everything.
– There is no comparison between what is being done now and what was being done then.
– No. There is the fact that the Commonwealth Government were tied down by section 87 of the Constitution. They had less money of their own, so to speak, to deal with. They were confronted with public works, and naturally the Treasurer at that time would, in order not to increase the pressure on himself, seek to borrow. But no such circumstances prevail now. The Treasurer is discharging practically all his obligations to the States to-day by paying back to the States only half of what Sir George Turner and his Government had to pay back under section 87. The differentiation only makes the aggravation of this loan policy, in the circumstances, all the greater. There is another consideration which is put before us, and of all people in the world, it is put before us by Senator Stewart, who is so strong on the unearned increment, and that is that a portion of this loan is to be applied to the purchase of land for a post-office at Perth. We are told that this purchase is bound to be a good bargain. This statement originally made by the Vice-President of the Executive Council has been repeated by a number of honorable senators opposite, and even Senator Stewart could not help joining in the chorus. But how can it be a good bargain unless the unearned increment is realized upon? As a matter ‘of fact, this is nothing but a speculation on the improving value of the property, and if the Government are going to adopt this policy in connexion with the post-office at Perth, why should it not be followed in regard to postoffices and Customs Houses everywhere?
– Do you want the Government to rent buildings everywhere?
– No. I do not want them to rent buildings if they do not require them. I have always held that there is no objection to borrowing for reproductive works. The defence in regard to this transaction is that it would be a good bargain in the future. In other words, from Senator Stewart’s point of view, the Government are taking advantage of the unearned increment, whereas, from the other stand-point, the investment may be regarded as a speculation. The inference, from all we have heard from honorable senators opposite, is that the land will become more valuable, and that this will be a good thing for the nation. But apparently it is denied that similar investments would be a good thing for the individual. The arguments used in connexion with the Perth Post Office remind me that some little time ago the Minister of Home Affairs went to Sydney and publicly announced that he contemplated buying up Martin-place, in order to acquire additional sites for post-office purposes. He also informed the people that £1,000,000 spent in that quarter for the purpose indicated would be one of the best investments the Commonwealth could make. After his romantic scheme had been made public, the Attorney-General had his attention called to the announcement, and described it as an “ Australian Night’s Entertainment,” and practically removed it from the sphere of practical proposals.
– And we have not heard anything more about it.
– Yes ; there was a little more - something that was rather humorous in so far as it had a bearing upon the relations existing between the Minister of Home Affairs and his colleagues. In addition to the Attorney-General, whose attitude I have indicated, the Treasurer also smiled the proposal out of court. He blew the “ hifalutin “ scheme to ribbons, and subsequently the Minister of Home Affairs maintained that he had just as much to say as the Prime Minister so far as the policy of the Government was concerned. He pointed out that the Caucus made the Prime Minister, as well as the Minister of Home Affairs, and that Ministers were on an equality. For the same reasons that were advanced by the Minister of Home Affairs when he proposed to spend £1,000,000 in Sydney, we are asked to approve of the expenditure of loan money in the purchase of a post-office site at Perth. Another reason that has been put forward in support of this proposal is very plausible at first sight, but is of no value when closely examined. We are reminded that we shall be borrowing from ourselves. But I would ask whether the proposal is any the better or worse on that account ? Personally, I think it would be a great deal worse for us to borrow from ourselves rather than from others, in view of the present financial conditions. There was never a time in the history of Australia when we more urgently required all the money we could get for investment in the development of our resources. We know that the Australian money market is as tight as ever it was. I admit that money is tight all the world over, but in no other country is the pressure of financial stringency being more severely felt than here. We know that overdrafts are being called in, and that advances have been practically brought to an end by the banks. It is common knowledge that every sovereign that can possibly be accumulated is being retained by the banks,” and one of the worst things we could possibly do would be to go into the Australian money market for borrowing purposes. The outlook is not at all cheerful. The exports of gold from Australia from 1st January to 19th September, 191 1, represented a value of £6,163,112, whereas for the corresponding period of 191 2 the exports were valued at £10,008,197, or a difference of £3,945,085. This additional gold had to be sent out during the current year to meet our heavier liabilities, and there does not seem to be any indication of a diminution in the export of gold. For ten months of the current year we have exported gold to the Value of £8,860,167, or assuming the same proportion is maintained to the end of the year we shall have exported £10,632,000. For the corresponding ten months of 1911 our gold exports were valued at . £5,821,707, or, assuming that the same rate of exportation was maintained for the year, the total would be . £6,995,707. Therefore, during the current year we are being called upon to pay between . £3,000,000 and £4,000,000 in excess of the amount required from us during the preceding year. Now, taking the exports and imports, we find that during the first ten months of 19 1 2 the imports were valued at £65,057, 812, or, allowing the same proportion for the full twelve months, the total for the year will be £78,057,812. The imports for 191 1 amounted to £65,000,000. In other words, we are importing very heavily during the current year as compared with the previous year, and the difference will probably amount to £15,000,000.
– What has that got to do with the loan market?
– I wish to show that at present the Australian loan market is the worst one to which we could go for borrowing purposes, and that the general principles which I am putting for- ward are not in any way weakened by the statement that we are proposing to borrow from ourselves. If we must borrow, the world’s market will be a better one for us than the Australian market. The figures I have quoted show how very stringent the conditions are in the local money market, and if the flow of gold continues, as at present, the Government will not be able to borrow money here, nor will they be able to obtain more money from the taxpayers, but they will be compelled to go into the open market to raise money to carry out public- works.
– The speech of the Leader of the Opposition bristled with misrepresentations with regard to the attitude of the Labour party, and the exposure to which most of those misrepresentations has been subjected has not prevented the honorable senator by interjections, and other honorable senators, from continuing the same line of argument. Senator Stewart made certain statements as to what he deemed to be the objective of the Labour party from a financial stand-point, and he gave us his ideas with regard to borrowing. He made it perfectly clear that he was speaking for himself up to a certain point, and he then repeated the actual wording of the Labour platform, and pointed out that only by that plank of the Labour platform were the members of the party bound. I regard it as distinctly unfair for honorable senators to continue to indulge in misrepresentations after plain and straightforward explanations are given. We can only assume that this course of conduct is pursued for electioneering purposes.
– How does the honorable senator get over Mr. Watson’s statement ?
– I take it that no better explanation could be given than that offered by Mr. Watson himself. Within the last twenty-four hours I have had an opportunity of asking Mr. Watson what he said, and what he meant.
– What he said is in Hansard; what he meant is another thing.
– Mr. Watson made many statements in regard to financial matters which are recorded in Hansard, and I do not suppose his observations on the occasion to which the honorable senator has referred were confined to the few remarks quoted. Mr. Watson assured me that he had always been favorable to borrowing for reproductive works, and had never opposed borrowing for that purpose when it was clear that the money could not be otherwise obtained. He said that the whole purpose of his remarks on the occasion referred to was, in view of the circumstances then existing, that, even though he said that “ at any time” or “at all times “ he would be opposed to borrowing, it was clearly understood that he had regard to the circumstances that then existed.
– Why did he not say that?
– I appeal to the common sense and fair play of every one to say whether there are not thousands of occasions on which speakers leave a great deal to be understood in view of the surrounding circumstances.
– Leave something to the intelligence of the audience !
– Just so; to the intelligent understanding of the audience, having regard to the circumstances under which the remarks were made. I am making no apology, nor am I indulging in any special pleading. I say most distinctly that thousands of electors believed, and still believe, that the circumstances under which the Federal Treasurers were returning a portion of the unspent one-fourth, to which the Commonwealth Government was entitled, to the various States, did not justify the Commonwealth Government in borrowing, though borrowing might be justifiable under different circumstances. We held, rightly or wrongly, that the Commonwealth should use the whole of that one-fourth, to which it was entitled, before it went on the market to borrow money. I know that Senator St. Ledger, who, when he is not carried away by his imagination, tries to be fair, will readily understand the position we take up.
– I can understand it, but I do not approve of it.
– But the honorable senator can draw a fair distinction between comprehending a position and sharing the same views. My own views on borrowingmay be very extreme, but I say that no one has a right to pin the party to anything other than that put forward on the platform of the party. Personally, I do not believe in borrowing, and we should not make nonborrowing our objective in the dim and distant future, but should endeavour to carry it out as soon as possible. If there is one thing I am more proud of than another in connexion with the work of the party prior to my entering this Parliament, it is the steadfast and successful opposition that was offered to borrowing. I am glad that, during the ten or eleven years of the existence of the Commonwealth, it has kepi off the loan market, and I would be more pleased if we could continue to take up the same attitude for all time. I have absolutely no belief in borrowing as a policy. It should be a matter of expediency, and should be resorted to when there is no other opening; but I should make this one exception: that, if we borrow for Commonwealth purposes from funds in the possession of the Commonwealth for which we would otherwise have no outlet, it is a wise and prudent course to pursue when we have no other revenue available. Senator St. Ledger, I think, entirely misunderstood the contention raised by the Ministers who have spoken when he pointed to the difficulty of successfully initiating loans in our own market owing to the financial tightness. The Minister did not refer to going on the Australian money, market to borrow when he spoke of borrowing from ourselves. He meant the actual borrowing of money from our own pockets as a Commonwealth - taking the money from the Trust Fund. It is immaterial whether we take money directly from the Notes Account or from any other Trust Account which is not immediately required for the purpose for which it is set aside. Take, for instance, the large amount which we will require for defence purposes. We all know that that will not be required within the current financial year, or for some considerable time, and, instead of allowing the money to lie idle, it is good financial business to utilize it for any remunerative purpose. Honorable senators opposite, who pride themselves on their very superior commercial knowledge, should welcome and indorse any policy of using the money that we have to the best possible advantage, when it otherwise would be lying idle.
– You cannot repeat this experiment always. You are not likely to always have such’ a surplus in the Trust Fund.
– When we have not got it we will not attempt to use it.
– What will you do then ?
– We will let the future ta’ke care of itself. Can any man living tell what our financial requirements will be many years hence? I have for many years been a consistent opponent of borrowing, and I have no faith whatever in the more modified way in which that plank is looked at in the State of New South Wales than it is here. I should like to point out that the plank in the New South Wales State Labour platform is not precisely on all fours with that in the Federal platform, and it is absurd to contend that we are in any way responsible for what the Labour party of that State may do. In the administration of their affairs they are a separate entity, as we are in ours. I think honorable senators opposite would be the last to father everything that may be done in the State Legislatures by the Liberal parties in those Parliaments. What I wish to point out is that, out of this loan of a little over £”500,000, £”,376,000 odd is to be applied to the redemption of existing loans. It has always been the policy of this and every other party to provide for the redemption of existing loans by borrowing. It would be impossible to make provision for the ordinary expenditure and for redemptions out of current revenue. There is no mention made by honorable senators opposite of the £360,000 to be expended on the renewal of loans which this Commonwealth Government is not responsible for incurring, but which was incurred in connexion with works taken over from a State. It is strange that honorable senators opposite have seized on the smaller amount which is to be expended in Perth, have entirely confined their criticism to that, and dropped altogether reference to the fact that the far larger amount is to be expended for absolutely unavoidable purposes. Honorable senators opposite, as well as members of their party in another place, condemn the Labour party because it does not propose to erect these buildings, and carry out other public works, out of loan money, and then they come here and condemn us unhesitatingly because we propose to do that very thing, and in the best possible way. Instead of throwing stones at us they should reconcile their conduct with their professions.
– It is only incidentally remunerative. It is not remunerative in the ordinary sense, such as in the case of a railway.
– A railway may not be a reproductive work; indeed, there are many railways in every State that are not reproductive. Here is a case where the work is so obviously reproductive that it is beyond the speculative character of many railways, and is therefore more justifiable than they would be. Honorable senators opposite agree with the statement that the expenditure of money in purchasing land in a young and rising city is likely to be remunerative owing to the growth of land values. I should like to refer to the paradoxical sort of argument of Senator St. Ledger. He says that we condemn the appropriation by individuals of the community-created value in land which we say the community should retain, and then he proceeds to condemn us for what he calls speculating in land values. But we are not doing that as an individual or personal matter. If we buy land now which will hereafter have an added value of that kind that will be securing the added value for the community.
– That is to say, what is wrong for the individual is right for the State.
– Of course, it is in many instances. The position is entirely different. The contention is that that value should go to the community, and anything which will secure any portion of it for the community is directly carrying out the very essence of the principle which we have been advocating. I maintain that the argument of honorable senators opposite is contradictory. I am sorry that Senator Millen was not here when I referred to what Mr Watson stated. A man’s own word is. very fair evidence of what he meant so far as any context may be required to enlighten one. Mr. Watson told me no longer ago than last night that he was speaking entirely with regard to the circumstances that then existed. He said that he never has been, and is not now, a complete anti- borrower. He believes in borrowing for reproductive works. His statement was made entirely in view of the circumstance that there was an unexpended surplus from the one-fourth which the Commonwealth was entitled to, and he did not believe in returning any portion of that to the States while going in for borrowing. Mr. Watson was most emphatic in stating that that was the attitude that he took up generally, so that even if he did not go to the length of explaining that, it was in conformity with the position which he took up.
– Mr. Watson was very unhappy then in the choice of his words.
– I contend that when a man is speaking to an audience that knows what his sentiments are, he in very few cases covers every possible objection that may be raised by those who are endeavouring to misrepresent the attitude of his party. In regard to this loan, there is only a small portion that is to be used for the purpose of buying a post-office site and erecting buildings. The purchasing of that land now is in conformity with our policy, because in the future it will have a very much greater value, and even if there is not a sinking fund in connexion with the cost of the buildings, there will certainly be such a large increase in the value of the land itself as to far more than compensate for the deterioration of the buildings erected on the land.
– I think the creation of a sinking fund was one of the planks of the Labour party’s platform?
– Personally, I think very little of a sinking fund, unless borrowing is stopped. To take money out of one pocket and put it into another is not of much value.
– That is what is being done now.
– In the present instance we are taking money from the Trust Fund and investing it, because if we did not do so it would be unremunerative.
– Not unremunerative, because the Government could lend it out at 4 per cent.
– There is no doubt whatever that the money which the Commonwealth pays out of one fund will come back into another. Therefore, we are not losing money by the transaction. If there is any justification for borrowing at all, surely it must be stronger when money is borrowed to be used for a remunerative purpose. We have been met with the statement that since the abolition of the compulsory payment to the States of threefourths of the Customs and Excise revenue the Commonwealth Government had a much larger revenue to handle, and that, therefore, there is not the same excuse for borrowing as there was when Sir George Turner was Treasurer. But it must be remembered that the payments of the Commonwealth then were very small. The Federal services which have been tak” en over from the States have been developed, and have involved an enormous additional expenditure, which accounts for the additional revenue received. In regard to
Defence, for instance, the expenditure was trifling from a Commonwealth point of view when Sir George Turner was Treasurer. Now the expenditure in thai direction amounts to millions sterling, and it is growing. We are paying for the construction of battleships and for the training of our Military Forces entirely out of revenue. The postal services, which were being starved in Sir George Turner’s time, are now being looked after. Additions and new works involve an enormous expenditure. There are large out-goings for oldage and invalid pensions, and the States have been relieved to a large extent on that account. We have also incurred additional liabilities through making our old-age pensions payments more liberal. One might go through many items, and show where the Public Services taken over from the States have not only been added to in number, but have been’ developed and amplified in every direction. There is, therefore, ample reason why the larger revenue of the Commonwealth should have been expended, and the additional expenditure by no means points to extravagance. That being the case, I say that we have an infinitely better cause for borrowing now than the Commonwealth had at the time when it refused to expend one farthing more than it could avoid of the Customs and Excise revenues, and was handing money back to the States unnecessarily, whilst, at the same time, proposing to go on the money market to provide for necessary expenditure. Nothing has been said by Senator Millen, who spoke forcibly and at length, to justify this criticism.
– Senator Pearce blamed me for not going further into detail.
– Senator Rae might say that Senator Millen’s speech was not only forceful, but ingenious.
– I always knew that he was ingenious, but somehow or other, in the exercise of his ingenuity, , he has a knack of so representing what others have said that their statements are made to mean something entirely different from what was intended.
– I am satisfied to leave the quotations which I made to any impartial jury.
– If they are left to the impartial jury of the Senate, I am certain that the decision will be against the honorable senator. There is a certain unfairness in being too ingenious, and in taking what a speaker has said on one particular occasion and applying it to entirely different circumstances. Take, for instance, what the honorable senator said in regard to the statement of Mr. Thomas.
– How can the honorable senator qualify those words - that he was against borrowing for reproductive purposes ?
– The statement of Mr. Thomas was that a good deal might be said for borrowing for reproductive purposes, but that, personally, he was opposed even to that.
– Under those conditions.
– He did not say anything about conditions.
– Whenever we can get an opportunity, by raising sufficient from the taxation of the wealthy, to construct all public works out of revenue, I shall be absolutely opposed to borrowing a single penny for any purpose except the redemption of existing loans, or some unforeseen national emergency.
– Would not the honorable senator take money for such purposes out of the people’s pockets?
– No; because it is clear that loans borrowed at different periods and in different amounts will have to be redeemed at different times. It would be absolutely impossible so to regulate the revenue of the country so as to pay off loans by that means. It is an absolute absurdity to attempt to do such a thing. Within the next few years one or two States have loan money to repay to the extent of twenty or thirty millions sterling. That money could not be raised from revenue. If 0 my policy could be carried out, I would have no fresh borrowing, and would proceed to establish a sink-5 ing fund to pay off loans already existing. But, until we do stop borrowing, a sinking fund is a farce. I contend, with Senator Stewart, that we should be prepared by direct taxation gradually to provide sufficient funds to construct public works, and I think that other sources of income which could well be applied to that purpose would be profits from existing industrial undertakings of the Commonwealth, and from any monopolies which might be nationalized, and revenue derived from the taxation of community-created values. I believe that we could adopt such a system without injury to any deserving section of the community.
– I think the honorable senator is departing from the subjectmatter of the Bill.
– If I am doing so, I am only following the example of other honorable senators. But I will not trespass further in that direction. One argument for not borrowing for general purposes is that national necessities might require the Commonwealth Government to borrow at some time of emergency. If that should be the case, and our credit was sound, whilst our position was free from anything in the nature of a mortgage oyer our assets, we ought to be able to borrow on advantageous terms. But to do that we should, as far as we can, avoid borrowing in time of peace. We should live within our income, so that in time of emergency we should be able to borrow on the most favorable terms. On this occasion, the greater part of the money to be borrowed is required for redemption of existing loans. The other portion is required for a reproductive work. If ever there was a justifiable loan it is this. It is further justified by the fact that our Notes Issue Reserve Fund is available for the purpose, and that consequently we are not taking money out of the pockets of the people, but simply making a wise use of our own money. If it is good business to lend from the Trust Fund to the States, it must be equally sound business to utilize thismoney for our own Commonwealth purposes.
– Some time ago the Prime Minister said that he dreaded a seventh borrower appearing in the market. I find from the Budget-papers that in 1911 this * Parliament passed a Loan Bill authorizing the borrowing of £2,460,476. We are now asked to borrow , £529,526. We have made forced loans through the note issue to the extent of £5,703,816. Those three sums total £8,693,818. I find that the amount required to retire loans is £602,526. If we deduct that from the £8,693,000, we find that the actual net borrowing of this Government will be considerably over £8,000,000. The Government have entered into the business of money-lending as well as of borrowing. They borrow and lend out at the same time. The Budget-papers show that up to the 30th June no less than [£5,000,000 has been invested in the various States. That money was quite enough to meet the requirements covered by this measure. Some of the loans fall due in June and August of next year.
– Short-dated loans are profitable.
– The Government are only getting 3, 3½, and 3¾ per cent, on those loans. When Senator Rae speaks of short-dated loans, it is signicant to remember that no less than £3,130,000 has been invested in stocks which will fall due between 1919 and 1926. We can hardly call that a shortdated loan. The fact of the matter is that the reason why the Government are asking to be allowed to borrow this money is that they have been taking moneys available from the note issue, which, beyond the reserve, might have been legitimately used for purposes such as those for which this Bill is being passed, and have invested them outside. They have invested these moneys at 3 per cent., and now are going to borrow for the purposes of this Bill at 3½ per cent. Any one who imagines that the present Government have not borrowed something like £8,000,000 in three years will be making a serious mistake. What the Government really propose to do is to rob Peter to-day in order to pay Paul to-morrow.
– The honorable senator’s party never had a “ bean “ to lend to anybody.
– The simple explanation of that is that under the Braddon section they were compelled to. pay back all surplus revenue to the States. Owing to the muddle which the Government have made in borrowing trust monevs, in order to lend them again, it is possible that the money asked for under this Bill should be borrowed. But I wish to say that I do not approve of the Government entering into the business of money lenders by raising money from the people in excess of requirements, whether by a forced loan, as they have done in connexion with the note issue, or in the form of excessive or unnecessary taxation. They should take as little as possible from the pockets of the people, and pay their way by managing the affairs of the Commonwealth as economically as possible.
– - I do not propose to say more than a few words on this measure. I am not acquainted with the particulars of the land purchase transaction in Perth, and am unable to say whether it is as good as has been represented. I am, however, quite prepared to admit that it is a wise ‘policy, when the opportunity presents itself, to secure sites which will improve in value, and will be required for public purposes later on. I am not prepared to say that the practice adopted by the Government in dealing with trust moneys is a wise one. I am inclined to believe that it is rather a dangerous practice when it can only be availed of by the raising of a forced loan from the people as the Government did in connexion with the note issue. It should be remembered that most of the money in the Trust Fund has already been hypothecated for specific purposes, and to apply it to other purposes is a diversion of trust moneys which may not be available when required for the purposes for which they have been set aside. At the last election the manifesto issued to the electors of Victoria by the Political Labour Council indicated that the Labour party were dead against borrowing. It was pointed out that Australia had already borrowed some £230,000,000, and the statement was made that not one penny of that amount need have been borrowed. Can any one realize the absurdity of such a statement? What would this country have been had we not borrowed in the early days, when there were no people here upon whom to levy taxation? In this debate honorable senators on one side have endeavoured to show that members of the Labour party have said that they would not borrow, and honorable senators opposite have been concerned to explain that when they said that they meant something else. I admit that members of the Labour party are at liberty to change their mind and review what they said in the past, and that, as the circumstances have altered, they may alter their policy. We know that, speaking generally, the State Labour parties have entirely altered the non-borrowing policy. In New South Wales they have borrowed £10,000,000 in two years. In Western Australia they have borrowed £2,000,000, and the Labour Government in South Australia also borrowed money. The Federal Labour Government will need to borrow very largely if they are to carry out the works to which the Commonwealth is committed. I rose particularly because, in his reply to the attack of Senator Millen on Friday last, the Minister of Defence has made statements which are not accu- rate. The honorable senator stated that Senator Millen should be very careful when he made statements that they were accurate. But, in referring to the time, in 1902, when Sir George Turner proposed to borrow money, the Minister of Defence said that Sir George Turner did not set out clearly what the money he proposed to borrow was for.
– I said that the Bill did not show what it was for.
– Senator Millen interjected that a statement was submitted to Parliament of the way in which it was proposed that the money should be expended, and that it was for works connected with the Post and Telegraph Department.
– The honorable senator said that the schedule to the Bill showed that, and I said that there was no schedule to the Bill. I have a copy of the Bill here.
– -The Minister of Defence then said that the statement referred to did not bind Sir George Turner, because it was not in the Bill. Knowing Sir George Turner as I do, and knowing what the Commonwealth owes to him for putting the business of the Treasury on a splendid and solid footing, and aware, as I am, of his reputation as an absolutely straightforward, honest, and careful man, I had some doubts as to the accuracy of the Minister’s statement.
– The Liberal “push” did not think that of him, because it was not long before they “ biffed “ him out.
– I do not know to whom the honorable senator refers when he speaks of the Liberal “ push.” “ Push” is a word used amongst larrikins ; it is not used by educated people or By legislators. I took the trouble to inquire into the matter, and I find that Sir George Turner submitted to Parliament a very lengthy statement, in which he showed clearly how the money proposed to be borrowed was to be spent.
– Would Parliament be necessarily bound to give effect to what was contained in that statement?
– The honorable senator might wait until I have finished. The statement refers to works in New South Wales, Victoria, Queensland, and the other States. I need not give the particulars, but the works are all connected with the Post and Telegraph Department. Our honorable friends opposite have gibed at
Liberal Governments for not keeping the Post and Telegraph Department uptodate, but they are the very persons who refused permission to obtain the money necessary to keep the Department uptodate.
– Yet the Liberal Government had £1,000,000 to hand back to the States.
– If they did, they handed the money back to the same people, and it did them good. The Minister of Defence said that the statement submitted by Sir George Turner did not bind the Government of the day, and that if the money had been borrowed it might have been used for some other purpose. I have here a copy of the Bill which was introduced by Sir George Turner, and read a first time on the 4th June, 1902. It authorizes the borrowing of certain moneys, and proposes the expenditure of £650,795 for public works and buildings. Sir, this Bill contains a schedule of all the works set out in the statement to which I have referred.
– I have a copy of the Bill which does not contain such a schedule.
– Therefore the statement by the Minister of Defence that the Bill was submitted without any schedule is absolutely inaccurate.
– There is no schedule attached to the copy of the Bin I have here.
– I find that the schedule to the Bill sets out the amount to be expended in New South Wales in connexion with the Sydney General Post Office; in Victoria; in Queensland for buildings at Brisbane; in New South Wales for telephone, telegraph, and postal works ; in Queensland, South Australia, Western Australia, and Tasmania. Every item of expenditure is included up to the total amount of the proposed loan -
– What is the date of the Bill?
– It was read a first time on 4th June, 1902. It is clear, therefore, that the statement which has been made to discredit a former Treasurer of the Commonwealth is absolutely wrong, and the gibe that Senator Millen should be careful to be accurate in his statements comes with a very bad grace from a Minister who evidently was not sure of his facts, and tried to bolster up an argument by casting discredit upon a former Treasurer of the Commonwealth. I am not opposed to this Bill. I have said that it may be a very wise course to secure ahead lands which may be required for public purposes. I do not know whether all the details of the transaction are correct; but I shall not quarrel with it, because it is what I would have done myself.
– - I have only a very few remarks to make in reply to the numerous observations which have been made in connexion with this measure. I point out to Senator Chataway that, whatever the source from which we secured the money necessary to carry out the purposes of this Bill, we were bound to introduce the measure, and set out the various items in it, or we should have- had no authority to get the money from anywhere. A statement has been made by Senator Millen that, in connexion with the purchase of land and buildings at Perth, we actually require only about £149,000. That statement, I am informed, is substantially correct. But interest will have to be paid on that amount from the time the Commonwealth takes over the property. It was necessary to make provision from the time the property was taken over by the Commonwealth until this money was provided and actually paid over to the original owners of the property.
– So that the Government are borrowing to pay interest?
– Because it is a part of the purchase money until the purchase is completed. It is necessary to provide for the total amount required to enable us to take over the property. There will be no borrowing to pay interest in the future; but until the transaction is completed, Senator Millen knows as well as does any one else that we are under an obligation to fulfil the terms of the transaction, and that is what is being done.
– As a business proposition, if the Government are paying interest on the purchasing price, they should receive the rents of the property.
– With regard to Senator McColl’s criticism, the honorable senator honestly declares that the acquisition of land such as this for a good purpose is advisable. He has not questioned the merits of the transaction at all. His only trouble arose from a difference of opinion between himself, -Senator Millen, and the Minister of Defence. The Bill has been favorably received, and I hope it will soon be carried.
Question resolved in the affirmative.
Bill read a second time.
In Committee :
Clause i agreed to.
Clause 2 (Minister may borrow £529,526).
– In reference to a statement by the Vice-President of the Executive Council as to the reason why the amount proposed to be borrowed under this Bill for the purposes of the acquisition of lands and buildings at Perth is in excess of the amount necessitated by the purchase itself, and includes’ a sum for interest, I should like to say a word. If I understand the transaction aright, the Government purchased this block of land, and the houses upon it, for a little under £170,000. They paid a cash deposit of £17,000. I find that my figures are not quite correct; but, as Senator McGregor has admitted, there was a difference between the amount we owe on that land and the amount we are to borrow, namely, £153,000. The Minister quite rightly said that it was due as interest on the purchase money from the completion of the purchase until the Bill becomes, law, and we can make our own deduction. I can quite understand that we have to pay interest on the purchase money to the vendors; but surely, if we have to pay interest, we ought to get the rents derived from the properties since the date of purchase? Are we to pay interest on the purchase money and the benefits to go to other people? That seems to be the position, unless the Minister can offer some other explanation. I understand that the transactions were completed about six months ago. Necessarily, if we concluded a bargain with the vendors then, and can not pay until this Bill goes through, we owe them interest on the purchase money; but the property should count as ours from the time we commenced to pay interest, and the rents ought to be ours from the date of purchase.
– If the rents equal the interest.
– The rents are alleged by the Government to be greatly in excess of the interest. Why are we to pay interest if the rents are to go to the vendors? On the contrary, if the rents are to come to us, there ought to be no necessity to include in the Loan Bill an item of £3,000 to pay interest. We have heard a great deal about the borrowing policy of the Government, but here the
Vice-President of the Executive Council has admitted that they are going to borrow money to pay interest. I cannot allow the clause to pass until I know more about this matter.
– - Ifeel rather inclined to compliment the Government on their changeof view. This is a Bill to authorize the borrowing of half a million, notwithstanding all the outcry against borrowing, restriction of borrowing, and never borrowing except for reproductive works. I am glad to know that the Government are alive to the fact that it is a proper thing to borrow on certain occasions, and for certain purposes. Here they have purchased a property on which they intend to erect a postoffice, and, if I understand rightly, other buildings, which are to be let and will bring in a certain revenue. I have felt all the time that, as regards permanent public works - that is, works that are to last for half a century - it is not a good policy to take the money for their construction out of the revenue for the year in which it is spent. Therefore, I am pleased to see that the Government are adopting this policy. It is said that this money is to be borrowed from our own people, but there is nothing in this clause to indicate where it is to be borrowed. The Minister said, “ We are going to borrow from our own people.” He meant by that phrase to borrow from the Trust Accounts which have been created. _ I take it that the funds in the Trust Accounts are laid aside for specific purposes. If there is a sudden demand on the Trust Fund, and more money is wanted, is money to be called in immediately to reimburse the Trust Accounts? We ought to know more about that matter. We have had questions on the notice-paper -about the tightness of the money market, and about the banks calling in their money. If they are putting pressure on their- customers, as has been stated here, they may put pressure on the Government. They may want some of the sovereigns for the notes which they have lying by; and if there is a sudden call on the Trust Fund, where are the Government going to try to get the money to reimburse the Trust Accounts ? I do not object, as a matter of principle, to the Government borrowing for permanent works, because - for buildings which are to last for half a century - it is a very fair thing to borrow the money provided that it shall be spent on the buildings and gradually repaid. But to talk about “ borrowing from our own people,” seems to me to be altogether absurd when money is wanted in Australia as it is at present. Instead of “ borrowing from our own people,” the people should be allowed to use their own money, and the Government should get money from outside the Commonwealth - from a foreigner or anywhere they like - so long as they pay a fair rate of interest. The spare money we have here ought to be devoted to developing Australian industries rather than be borrowed by the Government for a purpose of this kind.
– Is not the construction of works in Australia an Australian industry?
– T am not objecting to the money being used for that purpose, but congratulating the Government that they have come to a sane view in regard to some of these matters. I am disposing of this fallacy of borrowing, from our own people. When we have vast resources, as we have, we ought not to think about borrowing from our own people, but the spare money here ought to be worth a great deal more than ,3 per cent, or 4 per cent, in developing those resources. What we ought to do is to create a greater feeling of confidence in regard to our resources, and so encourage persons not to hoard their money or to lend it to the Government, but to put it out in legitimate enterprise in developing our resources; and for public works let us get money from those who have money to spare, and are willing to lend it at a low rate. I do not intend to oppose the passage of the Bill in any way, because I think that the principle is right.
– Will not money flow in from other parts of the world?
– I feel quite sure that in time to come the Government will have to borrow money from outside people if they are going to develop Australia as it’ ought to be developed. What would have happened to the States if they had had to wait until they could afford to construct out of revenue all their railways, waterworks, and great undertakings?
– They would have been better off to-day than they are. They would have had more.
– We should have been a hundred years behind the times. The railways in the Commonwealth are worth pretty well all the money that has been borrowed for public purposes. There is a time to borrow, and a purpose for which to borrow. The Government propose to borrow £153,000 for that purpose, and the balance of the amount for the redemption of existing loans.
– Just now Senator McColl charged me with making a misstatement in connexion with a Loan Bill introduced by Sir George Turner. I interjected, although he refused to listen to my interjection, that the Bill I had in my hand contained no schedule. I had applied for a loose copy of a Loan Bill, and the Bill I had was exactly the same as the Loan Bill to be found on page 1083 of the House of Representatives’ Bills for the session of 190 1-2. I read the purport of the Bill, which was “ A Bill to authorize the borrowing of money on the public credit of the Commonwealth,” and also clause 2, as follows : -
The Governor-General ma)’ borrow on the public credit of the Commonwealth money to an amount not exceeding one million pounds for such public works, buildings, and undertakings and matters connected therewith as the Parliament authorizes by any Act, and for repaying into the Commonwealth Consolidated Revenue Fund any sums before or after the commencement of such Act expended on any such public works, buildings, or undertakings or matters connected therewith.
After I read that clause I said that there was no schedule attached to the Bill, nor is there.
– That was no!’ the Bill.
– A Bill authorizing that loan is on the records of the other House, and there is no schedule attached to it.
– That is not the Bill authorizing the loan expenditure.
– I can only take the meaning of words. This is “A Bill to authorize the borrowing of money on the public credit of the Commonwealth,” and is to be found on page 1083 of the bound volume of House Bills for the session of
T901-2. What Senator McColl has in his hand is not a copy of this Bill at all.
– No; but 3’ou did not get the right Bill.
– What the honorable senator has in his hand is not a copy of this Bill, but a copy of -
A Bill to authorize the expenditure of certain moneys.
It is the Loan Appropriation Bill that followed the Loan Bill from which I was quoting. In the Loan Appropriation Act –which I had not seen - there is a schedule which Senator McColl read, but he charged me with misrepresenting the position, and said that tho Bill I had quoted from had a schedule.
– I did not.
– The Bill which I quoted from has no schedule, but the Bill which the honorable senator quoted from was the Loan Appropriation Bill, which is to be found on page 1085 of this volume.
– The point of this controversy between the Minister of Defence and Senator McColl was as to whether the Parliament to which Sir George Turner applied for authority to borrow was made aware of the purposes” for which the money was desired.
– That is not the point at all.
– That point was raised by interjection by Senator Rae, who now denies it. The Minister talks aboutwriggling, but he has been doing nothing else all the afternoon. I shall .show that he came here with information .which was absolutely misleading.
– Show that.
– I intend to do it directly, but I shall take my own time, as the honorable senator told me once. The point in regard to Sir George Turner’s Bill was as. to whether Parliament knew the purposes for which the money was wanted. Senator Rae interjected, and, turning to the Minister, said, ‘ ‘ Although you might have had the Minister’s word, he might have gone out- of office.” The Minister wished us to believe that Parliament was asked to vote the sum without knowledge of the purposes for which it was required. With a copy of the Bill in his hand, he allowed that impression to go forth. Here is the clause to which the House, of Representatives was invited to assent -
The Governor-General may borrow on the public credit of the Commonwealth money to an amount not exceeding one million pounds for such public works, buildings, and undertakings and matters connected therewith as the Parliament authorizes by any Act-
– That is what I said.
– What was the good of the honorable senator stating that the Minister might have spent the money as he liked ?
– Did I not read the whole of the clause?
– The honorable senator assented, by interjection, to the statement made by Senator Rae.
– I made my own statement.
– There was the answer to the whole of the argument which was addressed to the Chamber at that time.
– I read the whole of the clause.
– Honorable .senators heard what the Minister read. The Bill brought in by Sir George Turner secured the rights of Parliament, and bound the Treasurer of the day, whether he himself remained in office or went out. It laid an absolute obligation on the Treasurer to spend the money only in the way approved of by Parliament. That was the -point brought forward by the Bill.
– The point brought forward by Senator McColl was that the Bill I quoted from, had a schedule.
– That is absolutely wrong.
– The Minister ought to have been candid, and told the Senate that at the time he referred to the whole details of the proposals were laid fully before Parliament. I wish to contrast the action of Sir George Turner in putting information fully before Parliament with the action of the Minister this afternoon. The Minister challenged a statement made by me last week that the Labour Governments in Australia had been borrowing more than Liberal Governments.
– You said they have been borrowing more than all the other Australian Governments put together.
– The Minister may have it that way if he likes for the present. He brought forward a set of figures, which he assured the House had been obtained from the Government Statistician, for the purpose of showing what amounts had been borrowed by Labour and Liberal Governments respectively during the three years 1909-10, 1910-n, and 1911-12. The moment the Minister read the figures I knew that he had abstained from giving the House the whole truth. The figures quoted by the Minister, and which I have no doubt he obtained’ from the Government Statistician, represented the total amount borrowed by Labour Governments during the years referred to as only £13,000,000. I refuse to believe that the Minister has not a better knowledge than to be misled into the belief that that amount represents the total borrowings of Labour Governments in the three years, and I accuse the Minister of absolutely withholding information or of being more ignorant than he, as a public man, ought to be.
– Does the honorable senator say that those figures do not represent the whole of the loans raised in that time? His statement deals only with loans.
– Exactly. Would the Minister regard money borrowed by a State Government from the Commonwealth Government as a loan?
– Then he has not included in his statement the amounts borrowed by the States from the Commonwealth.
– You spoke of loans - of money borrowed.
– When I asked the Minister whether he considered that money borrowed from the Commonwealth by the States was loan money he answered in the affirmative. Now he is turning round, sneaking away, and raising quibbles. The Minister, as a member of the Government which granted the loans, should know what money was lent bv the Commonwealth to the States. And yet he has brought forward a statement exclusive of the moneys which went from the Commonwealth Treasury to the State Governments.
– What alteration would that money make, even if it were included?
– That is not all that has been left out of the Minister’s statement. When the Minister puts forward information of this kind, does he do so in order to discredit me, or to mislead the House ?
– lt discredited your statement, anyhow.
– It did nothing of the kind. We have the statement of the Minister that the Labour Governments in Australia during the years mentioned borrowed only £13,750,000, and I want to show how inaccurate that statement is. Turning to the details, I find that in the year 1910-n the only Labour Government that is debited with having borrowed is the New South Wales Government. But I hold in my hand a Loan Act, which was passed at the instance of the Verran Government in South Australia, authorizing the raising of £4,750,000.
– Did they borrow the money ?
– Yes, from their local Trust Funds.
– Does the honorable senator accuse Mr. Knibbs of supplying me with false information?
– I am not making any accusation against Mr. Knibbs, and I am not going to allow the Minister to shelter himself behind Mr. Knibbs.
– He supplied me with the information T gave to the House.
– I am tired of the Minister coming here in this way and tendering misleading information.
– Do not be insulting; keep your temper.
– The Minister wants to know whether the money was borrowed by the South Australian Government. It is immaterial whether or not the whole of the money was borrowed in the one year.
– They may not have borrowed a penny of it in that year.
– They may not have done so. But I can show that the Labour Governments have been borrowing very heavily from their Savings Banks and the Commonwealth Government, and that last year the total loan expenditure amounted to £15,000,000. This money was spent out of loan funds, but what the Minister calls the public debts were increased by only £10,000,000. It is highly discreditable for any public man to handle figures such as those submitted by the Minister without a knowledge of the subject on which he is speaking. I have justified every statement I have made.
– You will have some trouble to justify the sweeping statement you made that the Labour Governments have borrowed more than all the other Governments put together.
– I do not assume that the statement that I used those words is correct.
– Look in Hansard.
– I intend to do so. Even if I made such a statement, it would not be difficult of proof. As a matter of fact, the Labour Governments of Australia have entered upan a regular financial debauch.
– I would point out that this is a discussion in Committee, and I think we have gone past the stage at which general principles should be debated.
– I have no desire to transgress the rules. I wished to show that I had not spoken upon this subject without making myself acquainted with the facts and figures, and that I presented the whole of the facts and figures to the House. I shall be glad if the Minister will act in the same way. With regard to the clause now under discussion, I would like some explanation as to how the interest is to be paid, and why we are already creating a debit and have to borrow money to pay interest on this transaction The land cost £166,370, and, according to the Treasury officials, 10 per cent, was paid out of the Revenue Account by way of deposit, leaving a balance of £149,733. Now, the Bill provides for a sum of £153,000, or £3,267 more than is due to the vendors - unless interest has to be paid. When I asked a question about this, the Minister admitted that the extra amount was intended to meet interest and charges, and 1 understand that the interest liability arose in this way : Having purchased the property some time ago, but not having been in* a position to pay for it until the Bill went through, the Government considered it was only right and proper to pay interest to the vendors, who were being kept out of their money. But if we are to pay interest in respect to the money we have not paid, the rents accruing from the property should be ours. If the vendors are receiving the rents, should we be called upon to pay interest? It is very curious, and it can scarcely be a coincidence, that the amount of £3,267 represents, within £1 or £2, 5 per cent, for six months on the amount still owing to the vendors. Now, I want to know whether the Minister of Home Affairs has agreed to pay interest at the rate of 5 per cent, until the transaction is completed. 1 would not demur to a businesslike arrangement ot that kind; but if such an agreement . has been entered into the Commonwealth Government ought to be receiving the rents from the property.
– If the honorable senator will consider the matter for a few moments he will know that rents paid in respect to property acquired by the Commonwealth are paid into the Consolidated Revenue, and that if that money were required to be allocated to the payment of interest on the purchase money an item would have to be inserted in the Appropriation Bill. We think the same thing can be accomplished more expeditiously and easily by making provision in the Bill as at present, and we think, moreover, that by this means we shall be overcoming the red-tape system of which we hear so much in the newspapers and on the public platform. I understand that the tenants are paying their rents to the Commonwealth Government, and that the money is being paid into the Consolidated Revenue.
– I am very glad to have the information afforded by the Vice-President of the Executive Council ; but I do not know whether it will be very gratifying to my honorable friends opposite. It would now appear that whilst the rents are being paid into the general revenue, the Government intend to borrow money to pay the interest.
– The circumstances justify us.
– Circumstances may be held to justify anything. It is just as well that we should know that the revenue is deriving the benefit of the rents received from this investment, and that loan money is to be devoted to the payment of interest.
– Against that we have paid a portion of the purchase money out of revenue.
– The honorable member would not have been aware of that fact if I had not dug it out. I was fully justified in the statement I made on Friday that there was an amount in regard to which no explanation had been forthcoming, but that I had no doubt represented interest and charges which were to be paid out of the proceeds of the loan.
– Senator Millen did not supply the missing figures which he said were necessary to complete the statement relating to the moneys which have been borrowed by the Labour Government.
– The Chairman would not permit him to do so.
– I propose to readthe letter which the Government Statistician sent to me when he forwarded the figures which I have communicated to the Senate.
– Have you your letter to the Government Statistician ?
– I did not write to the Government Statistician, but I referred Senator Millen’s statement to my secretary, and asked him to write to the Government Statistician, and request him to supply figures as to loan moneys during the last three years. Here is the letter received by my secretary - -
Melbourne, 9th December, 1912.
In reply to your letter of the 9th inst., I am sending you the information required by the Minister of Defence in the accompanying table. The figures have been taken from the last three annual Statements made by the respective State Treasurers, referring to loans floated in the financial years 1909-10; 1910-11, and 1911-12. In that period there have been three State Labour Governments in power in Australia; those of Messrs. McGowen (New South Wales, October, 1910 to present time) ; Verran (South Australia, April, 1910, to February, 1912) ; and Scaddan (Western Australia, November, 191 1, to present time). The loans in the remaining States have been contracted entirely by Liberal Governments.
Yours truly, (Signed) G. H. Knibbs, Commonwealth Statistician.
These are the figures supplied to me by the Government Statistician as to the loans effected by the respective State Governments. If the statement is misleading, I have been unintentionally the means of disseminating it. I do not admit that it is misleading. Senator Millen’s statement refers specifically to the loans raised by Labour Governments, and he said that the Labour Governments had borrowed more money by way of loan than other Governments. I quoted his remarks, and I instructed my secretary to get from the Government Statistician the figures dealing with the matter. I think that when Senator Millen reads the proof of his remarks he will find that he referred specifically to that matter.
.- When Senator Millen does read his proof, and when the Minister reads his proof, we shall probably know what is meant. But I am not concerned with that. What I am concerned with is this : That I think it is absolutely obligatory on the Minister, after what has been said, to produce at some definite time the letter which was sent by him-
– Not by me, by my secretary. My secretary has gone home, but I shall do that to-morrow.
– The Minister, though only a layman, knows enough of law to know that what he has done by his agent, especially when, he as a Minister does something through his secretary, is done by himself.
– Certainly it is.
– I go no further with this controversy than to invite the Minister to get a copy of the letter sent to Mr. Knibbs, through his secretary, by his instructions. Any answer which the Minister may have read this afternon has no proper relevancy until we know exactly the text of the question which Mr. Knibbs has answered.
– It deals with the question of loans.
– It may deal with the question of loans in half-a-dozen different ways. The answer is dependent entirely upon the question which brought it about. I understood the Vice-President of the Executive Council to say that the Government did not indulge in the usual redtape practice. Is that what the VicePresident of the Executive Council said?
– I did not make a general statement. I made it with respect to the transaction under discussion.
– He said that the Government avoided red tape in that particular transaction.
– Is that what the Vice-President of the Executive Council said ?
– I do not see much avoidance of red tape. The Vice-President of the Executive Council has told us that the rent of these properties has gone into one pocket, and that the interest has been paid out of another. Is that what he calls avoiding red tape?
– In a simple financial transaction of this sort the whole thing could have been done by one Department just as an ordinary business man would have carried out the transaction. If an ordinary business man had been buying this land he would have credited on the one side the rents that were due, and on the other side debited, the interest. The Government have not done that.
– You know that two, in fact, three Departments, are involved according to the old precedent.
-That is an admission that the old red-tape procedure is in force to-day, not a proof that it has been done away with. The vendors of this property may be said to have lent the Common wealth Government money, and I want to know what interest the Government have paid on it. I heard some mention of 5 per cent., and I want to know if we are paying 5 per cent, pending the completion of this transaction. I also want the Vice-President of the Executive Council to tell the Committee what rents have been received from this property since the agreement for sale was executed. I think the Committee is entitled to that information. I want to compare the amount paid by the Government in interest because of this delay of six months, with the amount the Commonwealth has to receive with respect to rents due for the same period.
.- The Minister of Defence said I charged him with suppressing a schedule to a Bill. I did nothing of the kind. I could not have done so, because I had at the time the two Bills in my hand. I knew he had the wrong Bill. What I did charge him with was that he stated that no statement as to how the money was to be spent was submitted when the then Treasurer asked for a loan. It was submitted. I did not charge him with suppressing anything.
– You said it was dishonest.
– No; I said that he made an inaccurate statement. I put it mildly, and, I think, politely. He said that Sir George Turner had submitted proposals for a loan without submitting what that loan was for, and there were one or two senators on the other side who made sneering interjections on that remark. I did not charge the Minister with suppressing the schedule to any Bill, but I did charge him with making a statement that was not correct.
– I think honorable senators on this side thought that was what Senator McColl did charge the Minister with. Possibly the honorable senator, in his haste and temper, does not quite remember the language that he did use. I distinctly heard him use the words “inaccurate” and “dishonest.” Senator Millen stated that it was an interjection by me which drew that statement from the Minister. I did not say anything about the dishonesty or otherwise of any previous ‘Treasurer but I asked if there was anything to prevent the purpose of that loan being changed after it was effected. We know that money is sometimes borrowed for one purpose and used for another, and it was only after the
Minister had quoted the Loan Bill that Senator McColl brought forward the Appropriation Bill, which the Minister had not seen at the time.
– In reply to Senator Clemons. I may say that the honorable senator knows that it would be quite out of the question for me to supply all these details; but if the honorable senator will ask for them in the form of a return or a question on a future day, I shall endeavour to get them. I was not the Minister who carried out the transaction. I have to take the information that is supplied by the officers of another Department, and they never suspect that small details of this description will be gone into. They consider that a general statement witu regard to the purpose of the loan ought to be quite sufficient; but if Senator Clemons desires to be more critical, and will ask for the particulars in the form of a return or a question, I shall endeavour to get them, but I do not want to delay the passing of the Bill.
– Surely it is not too much to ask the rate of interest that is being paid on the balance due and what rate of interest is going to be paid to the Trust Fund for the moneys borrowed from it. We do not know from what Trust Account this money is going to be taken.
– If the Vice-President of the Executive Council has not got this information I am not going to attempt to delay the passing of the Bill. I think the information I have asked for is information which the Committee ought to have, but if he has not got it now I do not propose to delay the matter any further. We do know that the Commonwealth is paying some interest on the purchase price. We also know that certain rents are accruing to the Commonwealth in respect of those properties, and I certainly think that when we are in Committee dealing on business lines with the purchase of a property that is information which ought to be .supplied. I shall take the first opportunity, probably by question to-morrow, of asking him to supply the information which I think ought to be given to-day.
Senator Sir JOSIAH SYMON (South Australia) [6.12]. - We would be glad to get the simple information which ordinarily, would be given by any one who wants authority to raise a sum of money for the purpose of paying off a debt. The amount stated is £153,000. All that is asked for is that some particulars should be given as to the way in which that amount is made up. I should not think it was beyond the possibility of my friends on the Ministerial bench to say what the rate of interest is. That ought to be a very simple thing. Either they have told us too much or too little. Either they have been given barely enough information themselves, or else, for some reason or other, they are indisposed to communicate the information to the Senate. I think they could within five minutes ascertain that information by communicating with the Treasurer in the other Chamber. It is a very simple thing, and it would facilitate business. The Vice-President of the Executive Council is always courteous and ready to facilitate business. It would have been a very easy thing whilst we have been debating this matter to ascertain that information. It would be very much more satisfactory if we got it now rather than after the Bill is passed, to elicit it by means of a question. If any alteration ought to be made in this amount - I do not suggest that there should be - it should be made now. There is no object in getting the information at all, unless in connexion with the consideration and passing of the Bill. I shall not go into the question as to whether it is better to have those rents passed into the Consolidated Revenue, and an appropriation made afterwards to pay interest, but we certainly ought to be given this information so that we may be able to set one against the other to see whether the Government are making a satisfactory bargain or not. We ought to know exactly what we are paying for this property, and the basis upon which we are borrowing this £153,000.
Clause agreed to.
Clause 3 agreed to.
– If we pass the Schedule it is perfectly true, as Senator Symon pointed out, that any question that we may ask hereafter will be, to put it mildly, much too late. It cannot possibly form the basis of any subsequent criticism. Does not Senator McGregor think that he ought to report progress now, and let us have an answer to the question that has been asked?
– The position is that so much of the money provided for in the schedule will be spent as is really necessary. Senator Clemons will recognise that some margin must be allowed when business of this kind is being carried out.
– There is .another matter about which I feel curious. In view of the statement of the Vice-President of the Executive Council that rents are to be received into the general revenue, and that interest is to be drawn out of the Loan Account, I should like to know what authority is to have control of this business? It is obvious that the Post-office will have nothing to do with it, because only part of the property is to be under the control of the Post and Telegraph Department. Is the Department .of Home Affairs to act as a house and land agent ?
– Why not?
– I simply want to know. If we are going into a business of this kind, buying up properties all over Australia, we shall need to establish an Estates Branch.. I should like to know whether provision has been made for controlling properties of the kind. The rents ought not to be put down as revenue obtained by the Home Affairs Department. There ought to be a proper system of accounts.
– Of course, the AuditorGeneral will take very good care that there are no irregular transactions in connexion with these properties. I do not know what may happen in a few years, when the work of the Commonwealth extends, but for the present this business will be under the control of the Department of Home Affairs. The rents received will go into the Consolidated Revenue. I have every confidence in the Auditor-General, and we can rely upon it that he will see to it that nothing irregular takes place.
– I should like to ask a question in regard to the item in the schedule as to the redeeming of loans of South Australia in connexion with the Northern Territory. At what rate of interest was that money borrowed, and what interest is it proposed to pay now?
– The information that I have with regard to loans to be redeemed, and which were originally raised by the South Australian Government, is that there will be a saving of something about 2s. 3d. or 2s. 4d. per cent. The Commonwealth will have more favorable terms than South Australia had.
– I understand the position to be that it is not possible to point specifically to any debts incurred by the South Australian Government on account of the Northern Territory for which we are liable. South Australia seems to have borrowed sums of money, and from the proceeds of those loans a certain proportion was spent in the development of the Territory.
– That is so.
– That being the case, there is no particular loan for which we are responsible, but I believe that an arrangement has been made by which the Commonwealth Government undertake to lift a proportionate share of each loan falling due. That means that in three years we shall have to meet £700,000 falling due.
– I should like to know the total amount of loans for which the Commonwealth is liable in connexion with the Northern Territory and the Port Augusta railway?
– I gave the information required by Senator Rae when the Northern Territory was under discussion. As far as I recollect, the total amount on account of the Port Augusta railway was somewhere about £2,300,000, and there was an accrued deficit of over £700,000. I cannot remember the exact amount. If I had thought the information’ would berequired I should have had it available. The total indebtedness is about £5,500,000.
Schedule agreed to.
Title agreed to.
Bill reported without amendment.
Standing Orders suspended, and report adopted.
Bill read a third time.
Bill received from the House of Representatives; Standing Orders suspended; Bill (on motion by Senator McGregor) read a first time.
In Committee (Consideration resumed from 5th December, vide page 6445) :
Clause 4 -
Provided that -
if it appears that the claimant has a claim for compensation for the injury under any other law in force in the Commonwealth or any other place, compensation under this Act shall only be allowed upon the claimant undertaking not to claim compensation for the injury under any such law;
where the workman continues in theservice of the Commonwealth after the injury, any pay received by him from the Commonwealth shall be deducted from any compensation payable under this Act in respect of the same period. (4.) Any undertaking given in pursuance of paragraph (e) of sub-section (2.) of this section, shall have effect as a contract between the claimant and the person from whom the compensation is claimed.
Upon which Senator St. Ledger had moved -
That the words “if it appears that the claimant has a claim,” paragraph (e), sub-clause 2, be left out, with a view to insert in lieu thereof the following words : - “ if, within the time hereinafter in this Act limited for taking proceedings an action is brought to recover damages independently of this Act for injury caused by any accident, and it is determined - in such action, that the injury is one for which the Commonwealth is not liable in such action, but that he would have been liable to pay compensation tinder the provisions of this Act, the action shall be dismissed ; but the State or Federal Court inwhich the action is tried shall, if the plaintiff so choose, proceed to assess such compensation, but may deduct from such compensation all or part of the costs which, in its judgment, have been caused by the plaintiff bringing the action instead of proceeding under this Act. In any proceeding under this sub-section, when the State or Federal Court assesses the compensation, it shall give a certificate of the compensation it has awarded and the directions it has given as to the deduction for costs, and such certificate shall have the force and effect of an award under this Act.”
– Only one reason has yet been given for the refusal of the Government to accept my amendment, and that is the startling <one that there are constitutional difficulties in the way of its acceptance. This is the first time that the present Government have been deterred by constitutional difficulties. It was mentioned that ii injured workmen were given, under this Bill, recourse to the State Courts, a constitutional difficulty might arise. To meet that, I have slightly altered the provision which I have taken from the Imperial and State Act, so as to confer jurisdiction upon the State Courts. To confer jurisdiction upon those Courts is one proposition, and for the State Courts to decline that jurisdiction is an entirely different proposition. I remind honorable senators that the Bill itself, in paragraph b of this clause, and paragraph e, which we are now considering, recognises the jurisdiction of State Courts. In the circumstances, the objection raised to the amendment may be described as absurd and finical. It is possible that 99 out of 100 cases arising under this Bill would be met by its provisions, and adequate compensation would be recoverable, but it is the one-hundredth case which may cause hardship, and I am leaving the 99 to go after the one-hundredth case, and provide for that. If a Commonwealth workman is injured, he has the right to claim compensation at common law under a Workmen’s Compensation Act of any of the States, or an Employers’ Liability Act. And .under paragraph b of this clause we provide that he shall not be entitled to recover compensation, both independently of, and also under, this Act. That is quite right if a man secures compensation by an appeal to a Court under another Act; he should not be at liberty to seek an additional remedy under this Bill. But paragraph e provides -
If it appears that ‘ the claimant has a claim for compensation for the injury under any other law in force in the Commonwealth or any other place, compensation under this Act shall only be allowed upon the claimant undertaking not to claim compensation for the injury under any such law.
There is such a thing as a law of. estoppel, and a claimant defeated in an application for compensation in a State Court would be estopped under paragraph e if he sought compensation under this Bill. Bevan, in his work on the Workmen’s Compensation Act of 1906, and referring to a law in which the provision I ‘wish to have inserted in this Bill is contained, says -
Section r, sub-section zb, gives a workman in :a case to which it applies an option whether he will claim compensation under this Act or take proceedings against the employer independently of the Act. But having that option he must take it subject to the condition on which it is given, namely, that though he may have two modes of relief he cannot have both. Therefore a concluded election to accept one of these modes of relief operates to debar him from claiming the other.
He cites his authority for that statement, and says further -
To this there is a saving given by sub-section 4.
Sub-section 4 of the Imperial Act here referred to is not in this Bill.
– What is it?
– It is practically the amendment I have moved. It is contained in the Imperial Act, and in four of the State Acts.
– The honorable senator should have had his amendment printed and circulated amongst honorable senators.
– I might have done so, but it has been quoted over and over again. It is so long that the VicePresident of the Executive Council described it as having been framed by myself in a “ diarrhoea of words.”
– Is it a copy of a provision in the Imperial Act?
– It is adapted from the Imperial Act, and made applicable to Commonwealth conditions, and a similar provision is to be found in four of the State Acts. The only reason given for refusing to accept the amendment is that there are constitutional difficulties in the way. I have already said that the jurisdiction of the State Courts is recognised in paragraphs &and e of this clause, and if the State Courts decline the jurisdiction we are in a position to force them to exercise it. What practically would be the effect of the amendment? An employe of the Commonwealth may be injured to such an extent that £500 would not be adequate compensation for his injury. He might be advised to appeal to a State Court under an Employers Liability Act for a larger sum. If he succeeds, no harm will be done. If he proceeds at common law, and is given a greater amount of compensation than is provided for under this Bill, no harm will be done. But if he has misconceived his remedy-
– Or has been illadvised.
– O Or if he has been ill-advised - as Judges differ, lawyers may be pardoned for differing - arid fails in any way, he will be thrown out of court entirely, and when he seeks a remedy under this measure the Commonwealth Government, I contend, can, if they choose, plead paragraph e as an estoppel, and demand that before he can claim the compensation under this provision he shall give an undertaking, even if he has a right to claim compensation under any other law, not to seek that remedy.
– If he fails at common law, will he forfeit his right under this Bill?
– It seems to me that the Commonwealth Government can plead that paragraph e has that effect.
– Suppose’ that he first sues at common law, and fails, and then goes to the Commonwealth ?
– Then the Commonwealth Government can plead this provision, and force him to give an undertaking before they give him a penny by way of compensation.
– But he will have exhausted his other remedy. He can then give an undertaking freely.
– How can he give an undertaking, he having already done the thing which he is asked to undertake not to do?
– Then the undertaking would be of no value.
– Why not say so in the clause?
– If a litigant goes to the Commonwealth first, he must give an undertaking not to go anywhere else.
– If the Commonwealth Government are advised that the man may have an action against them, either at common law, or under the State Employers Liability Act, they will put an undertaking in front of him. and decline to assent to his claim until he has signed it. Ought a man, in the circumstances, to be put to that risk? Neither the Imperial Act nor any State Act puts a man to that risk, but saves him from it. The Commonwealth Government can have the matter investigated thoroughly, and the Crown Law officers may say, “ This man has an action against you at common law, or probably an action under the State Employers Liability Act. He may get £2,000 or £3,000 damages if he chooses to sue. Now, protect i-ourselves right before his eyes, and make him face the risk of signing a declaration under paragraph e.” Is that fair?
– Let us hear what the Government have to say about the matter.
– I am trying to drag something out of the Government. I hope that they will accept the amendment.
– I am sure that every honorable senator will give the Commonwealth credit for doing the very best it can in the circumstances. What possible object can it have in depriving an employe of what is his just right? I wish to point out that the Imperial Workmen’s Compensation Act, as well as every State Act on the subject, is different altogether from this Bill. The Imperial Act is a general Compensation Act with respect to accidents occurring in the employment of workers throughout Great Britain, and so is every State Act with respect to compensation to workmen generally employed in that State. But this Bill deals with only a section of the workers in Australia, namely, the employes of the Commonwealth. If Senator St. Ledger recognises that fact, he must acknowledge that the case he has referred to under the English Act has no relation to this measure, because the employe and the employer are different.
– No ; it is a matter of law, not of person.
– Paragraph b of the clause only provides that an employe” cannot recover compensation first from the Commonwealth under this Bill, and then claim compensation from the Commonwealth or anybody else under another law. It provides that he cannot do the two things at the same time. The clause which Senator St. Ledger is endeavouring to amend does not debar any employe of the Commonwealth who, in the course of his employment, has met with an accident, from taking action under any other law, if he thinks that it will be to his benefit to do so, and if he fails there he can take advantage of this measure. But it provides that if he elects to come under this measure straight-away - and that is what every sensible employe will do, because it will be the most liberal and most certain legislation existing in the Commonwealth - he will have to give an undertaking not to seek a remedy under some other law at the same time. What more does the employe want ? If he comes under another law, and gets compensation, of course he will not be able to get compensation under this measure.
– - But, suppose that he does not?
– If the. employe” cares to come under this measure, he must give an undertaking not to sue under any other law, and we may rely upon his legal advisers putting him on the right track. Since the Imperial or a State Act is a general Workmen’s Compensation Act, the Court, working independently under that Act, can dismiss a case, and has dismissed a case. Although it may be a State Court which will try a complaint under this measure, yet it is very doubtful whether, under the Constitution, we could direct a Court in a State, as we could not direct a Court in Great Britain, to dismiss a case. If Senator St. Ledger desires to make what is plain and straightforward at present complicated and difficult, he will stick to his amendment. But if he wants simplicity to prevail throughout the whole of this legislation he will withdraw it.
Senator ST. LEDGER (Queensland; [8.26]. - I certainly shall not withdraw my amendment, but will leave it to the decision of the Committee. Let me give a case which the Minister has not touched. Leaving out the question of the exercise of the State jurisdiction under the Employers’ Liability Act, what will happen if an. employe1 of the Commonwealth sues at common law in a Federal Court, and fails?
– -Then he can come under this measure.
-Then there is no meaning, to my mind, in paragraphs b and e, because the latter says that if it appears that he has a claim, he must make a declaration before tie can come under this measure that he will not claim under the State Act.
– Yes ;” if he claims to come under this one first.
– It may be so.
– It is to be before the claim is allowed. It may be without a Court case at all ; read the words of the provision.
– I cannot read paragraph e in that way.
– It says that “ compensation under this Act shall only be allowed upon the claimant undertaking not to claim compensation for the injury under any such law “ ; that is, before there is a Court case at all.
– Yes; but suppose that he has been advised not to proceed under this measure and he has made a claim at common law in a Federal Court, what are the Government going to do?
– If he fails, he can come under this measure.
– I wish I was sure of that. It will not be denied by the Minister that, if the Commonwealth thinks that a man may have a claim for £5,000 damages at common law, it cannot ask him to sign an undertaking not to seek a remedy under any other law. The man will be barred, then, from seeking a common law remedy.
– No; because he will have decided to come under this measure.
– Why should the Commonwealth do that? Under this provision it can play fast and loose with an injured employed The Commonwealth Government can say to him, “ Sign this undertaking before you go to any Court of law.”
– Not before you go to any Court of law; before you go under this law.
– Is that what it means ?
– Then what is the objection to making that clear by this amendment? You can get out of any difficulty that may arise with regard to conferring jurisdiction on the State Courts, but why not allow it to apply to your own Federal Court? Why not place the question beyond all doubt?
– Supposing sub-clauses b and c are contradictory, will not the former prevail over the latter?
– No. They must be read together. It is the one case in the hundred that will be the hard case.
– When the claim is dealt with it mav not have to go to a Court at all.
– Dealt with I By whom ?
– By the Government.
– Supposing the Government stands on its rights, and requires the man to sign this declaration ? We frame laws so that as far as possible there shall be no doubt with regard to them, but there is a doubt about this provision. Sub-section 4 of .the Imperial Act which corresponds-
– That deals with a different kind of -compensation altogether.
– It is of no use the Vice-President of the Executive Council trying to bluff me. It deals with exactly the same kind of case.
– The Imperial Act only dealt with a section of the people when it was first passed. For instance; it did not extend to buildings over 30 feet in height.
– That was afterwards modified. I say, “ Deal with your own employes, and allow your employes to go into your own Court.” It must be admitted that if the Commonwealth is advised that the claimant may have an action atcommon law in the Federal Court, the Commonwealth Government can block him under sub-clause e. They can say, “ No. You will not have a penny. You must sign that declaration.” The moment the man has signed that declaration his common law rights in a Federal Court are gone. If the man elects not to sign the undertaking, it is a very nice point as to whether he will have an action in the Federal Court at common law, and that point should be placed beyond all doubt. There is a remarkable difference between this Bill and the Imperial Act in that respect, and there is a remarkable departure in this Bill from the provisions of at least four of the Acts of the States of the Commonwealth. The Commonwealth Government when dealing with their own employes leave the question of their liability in doubt, while the Imperial Act and the Acts of four of the Australian States make the position clear.
– Do you not think that an injured employe will have perfect freedom to appeal to the Court at common law, or under the Employers’ Liability Act?
– What is to stop him?
– Sub-clause e, I think.
– When he signs the undertaking it will become a contract.
– Sub-clause b is clear.
– There is no doubt about that. I have proposed this amendment, which appears in the Imperial Act and the Acts of four of the States, but which does not appear in this Bill, in order to make the position clear. The Commonwealth Government, when dealing with its own employed, should be subject to the same obligations as a private employer under the Imperial law and the State laws. It may be that if a- man chooses to sue at common law even in the Federal Court, and the Commonwealth doplead sub-clause e, there is no estoppel,, but the risk is too great, and my amendment would place the question beyond: doubt. The only objection that can beoffered to it is that if we were to attempt to confer jurisdiction on the State Courtsthe State Courts would decline to exercisethat jurisdiction. Even if that be granted, it should be made quite clear that when an employe of the Commonwealth is suing in the Federal Court he should have the samerights as he would have if he sued at common law a private employer in any part of the Commonwealth.
– There is a great deal in the argument put forward by Senator St. Ledger, and I think it is a matter,, not of introducing the unwieldy section that is in the Imperial Act, but of revision. of this clause in order to make the position clear. I believe the intention of. theGovernment is not to prevent a man from: suing at common law, but as far as 1 can make out the draftsman has followed closely the provision in the Seamen’s Compensation Act which we passed last year. In that Act the departure was made, but. the position was made clear in paragraph c,. sub-section 2, of section 5, which reads -
If it appears that the claimant has a claim.for compensation for the injury under any law of the United Kingdom or of any other part of the King’s Dominions, or of any foreign country, compensation under this Act shall only beallowed upon the claimant undertaking not toclaim compensation for the injury under any such law.
If a seaman is injured, and he can claimunder the Commonwealth Act, or StateActs, or any Act in the United Kingdom, or a foreign country, he must enter intoan undertaking not to pursue his claim inany of those other countries as well as against us. Sub-section 4 of the Seamen’s - Compensation Act is reproduced in this Bill, and reads -
Any undertaking given in pursuance of paragraph (e) of sub-section 2 of this section shall’ have effect as a contract between the claimant and the person from whom the compensation isclaimed.
If compensation is claimed under the Commonwealth Act a contract is entered’ into between the claimant and the employer that the claimant shall not claim under any Act in the United Kingdom, the King’s Dominions, or any foreign* country, but that does not prevent him from an action at common law in any particular country . The whole point, with me is whether this Bill does so prevent ;him. I have looked closely into the point, and I think that it is only a matter of draftsmanship. I do not believe that the intention of the Government is to prevent a man from claiming at common law. lt must be remembered that the Bill does mot apply to the Commonwealth only, because the clause says -
Or any other law in force in the Commonwealth or any other place.
That may be Belgium, Holland, Great Britain, or any other country.
– Where you may have employes?
– Or where we may be having work done by a contractor or sub-contractor.
– Take the case of a Commonwealth employe1 engaged in London on certain work.
– If he claimed under the Imperial Act he would not be able to claim- under this Bill.
– He would not be likely to claim under the Imperial Act.
– I think he would prefer to claim under the Imperial Act, because if he wanted to pursue his case against the Commonwealth he would have to come to the Commonwealth to do it.
– His claim, could be granted.
– His claim could not be granted, because the English Courts have no jurisdiction.
– You are assuming that every one who meets with an accident will take action against the Commonwealth.
– I am assuming that. My experience is that the question of awarding compensation is always put to the arbitrator. There have been few cases that have been settled independently of arbitration, because the whole question hinges on the amount of compensation. The Bill sets forth the maximum amount that shall be paid by the Commonwealth Government in any case. That is the very reason why the case should be put to the arbitrator, to show that the State is entitled to pay the maximum in every case. The arbitrator is the Court.
– In every case that I have known, a stipendiary magistrate has been the arbitrator. This Bill provides exactly the same machinery. The only point that is not clear, to my mind, is this : Under the Bill, if a person is injured whilst in the employment of. the Commonwealth, he is entitled to get compensation except where there has been wilful and serious negligence on his own part. Is that workman to be shut out from going to Court if he prefers to do so, rather than to claim compensation under the Bill?
– He is not shut out.
– Take the case of a public servant who is killed whilst on duty. Suppose that the widow or next of kin consults a solicitor, who advises that it would be expedient to sue under the common law, because by so doing a larger amount of damages would be obtained than under this Bill. Suppose that when the case goes to Court, the widow is unable to prove her case. In that event, under the Imperial Act, the Judge who tried the case at common law could nonsuit the plaintiff, but could, at the same time, assess damages under this measure.
– Where is that prevented by the Bill? The honorable senator ‘ instances the case of a person suing at common law first. That would not apply here. The clause relates to instances where a claim is made under this Bill in the first instance.
– I have read the clause in conjunction with other- Acts, and have studied the greatest authority on workmen’s compensation, and I am inclined to think “that the plaintiff who proceeded under common law in the first instance would have to give up bis right to claim under this Bill. If the Government can give me an assurance I shall be satisfied. I do not want a public servant to suffer because of some mistake of ours in framing the Bill. Our Public Service ought to have all the benefits that are conferred upon workmen in private employment.
– I have given the assurance on the authority of the Crown Law officers.
– If the Crown Law officers advise that there is nothing in the Bill to prevent a claimant from suing at common law in the first instance, and, in the event of failure, falling back upon this Bill, I shall be satisfied. I quite agree that no person has a right to get compensation, under two Acts. But a claimant has the right to claim under the law from which he thinks he will benefit ‘ most.
– I direct attention to the language of paragraph b, “ the workman shall not be entitled to recover compensation both independently of and also under this Act.” I understand that to mean that he could not recover, but that he could take proceedings in any Court; and that if he got a verdict he would have to be satisfied with it.
– He takes his risk.
– But suppose he does not get a verdict in the Court in which he proceeds ?
– -Then he does not “recover.”
– Will the Crown Law officers assure us of that?
– That is the assurance we have.
– Suppose that the case is dismissed.
– Then the plaintiff does’ not “ recover.”
– That seems to me the common-sense reading.
– The clause does not say that the plaintiff shall not proceed, but that he shall not “ recover “ a second time.
– If he recovers some amount, no matter how small, I. assume that he has to be satisfied with the verdict.
– If the clause did not mean that, it would have said that the claimant “ shall not be entitled to proceed.”
– I understand, then, that if a claimant does not recover, that is to say, if he does not get a verdict from a Court, he can claim against the Commonwealth under this Bill. But if he claims under this Bill first, he must not appeal to any other Court afterwards. If the Government are assured by the Crown Law officers that that is the meaning, I am satisfied.
– I was at first in doubt as to the relation of paragraph b to paragraph e. I think that an employe’ is perfectly protected as far as paragraph b is concerned. What appeals to my mind is that the latter portion of the paragraph, which says “ shall not affect any civil liability of the Commonwealth under any other law.” Senator St. Ledger has quoted the Imperial Act extensively. I remember the first Workman’s Compensation Act being introduced into the House of Commons, where it was passed on the ist July, 1896. One of the provisions of that measure was that a workman engaged in the erection of a building had to fall 30 feet before; he could recover compensation. If ai workman was going to fall from a scaffold’! he had to make up his mind to fall 30’ feet, or not fall at all. Otherwise he would get nothing.
– I think the provision was that a building had to be 30 feet high before a workman could recover.
– If he fell 29 ft. 6 in., and was killed, his widow and dependents received no compensation. It it absurd to bring in the Imperial Act in relation to the framing of this Bill.
– The Imperial Parliament has amended the Act since the time referred to by the honorable senator.
– I admit that the original Act has been modified, but even yet the Imperial Parliament has not passed an Act allowing employes of the Government to recover compensation. So that- we are showing the Imperial Government instead of their setting us an example.
– I think the honorable senator is wrong in saying that at workman in the employment of the Imperial Government cannot claim compen«sation.
– This measurelays down no qualification in regard’ to» Federal employes claiming against the Government. I should hesitate to agree to’ the passing of this clause if I thought that’ paragraph e would debar an employe’ of the Commonwealth from claiming compensation under any other civil law. But! having listened to the legal arguments onboth sides, I am satisfied that paragraph.- b makes ample provision for the protectionof the workmen.
– - I do not know whether clause 5 has: been considered in this connexion; but if’ occurs to me .that it might have some bearding upon the matter. It provides that proceedings for recovery of compensationunder the Bill are not to be maintainableunless the claim for compensation has beenmade within six months from the occurrence of the accident. I take the case of a man who says, “I shall try my luck at common law before I appeal to the Commonwealth,” and proceedings in his action– are dragged out for over six months from the time of the occurrence of the accident.
– That would not affect the matter.
– He would have given notice.
– If he gave notics, he would be immediately requested to sign an undertaking that he would not seek compensation under any other law.
– That is the trouble.
– If the honorable senator will read the whole of clause 5 he will find that provision is made for the extension of the time.
– That is for a reasonable cause. Would the holding up of an action be regarded as a reasonable cause r
– If an action were pending, that would be a reasonable cause.
– - I admit what the Vice-President of the Executive Council has said with respect to the effect of paragraph b. I have noticed what is provided for also in paragraph c ; but I have failed to understand the reason for the insertion of paragraph e, which is not to be found in any other Workmen’s Compensation Act I know of. In the circumstances, I should like to be sure as to the effect of the paragraph. I have quoted cases where, but for such a provision as I desire to have inserted in this Bill, no relief would have been open to injured workmen. However, I am told that the Crown Law officers have decided that the use of the word “ recover “ in paragraph b will affect the case of a person claiming compensation from the Commonwealth under paragraph e. It is contended that if an. injured workman has not recovered compensation, he will be regarded as a claimant under paragraph e, though he may have tried to recover compensation under some other law. I doubt that; and the Government must accept the responsibility of declining to accept the amendment I have moved.
– I move -
That in paragraph e, after the word “ claim,” the words “ against the Commonwealth or any person “ be inserted.
– That will meet the case of a man working under a contractor?
– Yes. It is consequential on the amendment we have made including the Naval and Military Forces. I propose later to move the insertion after the word “compensation,” of the words “ or for any gratuity or payment.” That is necessary, because under regulations an employe” may have a claim to a gratuity or payment.
Amendment agreed to.
Amendments (by Senator Pearce) agreed to-
That after the word “ compensation, “ paragraph e, sub-clause 2, the words “or for any gratuity or payment “ be inserted.
That in sub-clause 4 the words “ and the person from whom’ the compensation is claimed” be left out, with a view to insert in lieu thereof the words “ and the Commonwealth or person as the case requires from whom the compensation gratuity or payment is claimed.”
Clause, as amended, agreed to.
Clauses 5 and 6 agreed to.
Clause 7 (Remedies both against the Commonwealth and a stranger).
– This clause makes provision for a dual remedy against the Commonwealth or any other person. It will render other persons liable to compensation for injury to an employe1 of the Commonwealth. There should be no objection to that.
Clause agreed to.
Clauses 8 to 10 agreed to.
Clause 11 (Regulations).
– I should like to ask whether the Government intend to introduce a provision providing for compensation in the case of workmen who contract a disease arising from the nature of their employment. I referred to the matter when we last discussed the Bill. This measure deals only with compensation for injuries received as the result of an accident, and it does not, as most of the State Acts do, make provision for the case of an employe” of the Commonwealth who contracts a disease arising from the nature of his employment. I think that in such cases compensation should be allowed in just the same way as it is proposed under this Bill to allow compensation in the case of a workman who breaks a leg as the result of an accident. Persons in the employ of the Commonwealth may contract lead poisoning or a number of other diseases owing to the nature of their employment, and may be affected quite as seriously as if they suffered an injury as the result of an accident. I should like to hear whether the Government intend to make any provision in that direction.
– This is a Bill to provide for compensation in the case of accidents to workmen in the employ of the Commonwealth. Permanent employes of the Commonwealth are entitled to receive a certain amount of pay during the time they are absent by reason of sickness. A casual employe absent from his work by reason of sickness would not be entitled to compensation. I hope that in the near future something may be done by legislation or regulation to meet such cases. Casual employes will, under this Bill, be compensated for injuries arising from accidents. Diseases which may be contracted owing to certain conditions of employment are not due to accident. I hope that in the near future legislation will be introduced to deal with sickness and unemployment, but it should be associated with such legislation as that providing for old-age and invalid pensions. It is, we think, beyond the scope of this measure providing compensation for injuries resulting from accident.
– This is a Workmen’s Compensation Bill, not merely an accident Bill. Nearly every State Act provides for compensation where a workman contracts a disease in the course of his employment. I do not know why the Commonwealth should be less liberal in regard to its employes than is a State. If not at present, there may yet be some work carried on by the Commonwealth where disease may be contracted.
– A linotype operator, for instance, may contract lead poisoning from working over a pot of lead all the time.
– If he proves that he got lead poisoning in that way, he will he entitled to compensation.
– No, because it would not be an injury.
– It would not he an accident, but he would be entitled to compensation, I think. The Commonwealth will have a- printing office, and ought to be made liable for any disease which may be contracted by an employ^ in that way. The- Commonwealth Act ought to be as comprehensive as any State Act. The Vice-President of the Executive Council might have an amendment drafted. and on a recommittal of the Bill it could be inserted in about five minutes. That would be a very simple thing to do.
Clause agreed to.
Schedules and title agreed to.
Bill reported with amendments.
Motion (by Senator McGregor) proposed -
That so much of the Standing Orders be suspended as would prevent the Bill being passed through its remaining stages without delay.
– I wish to explain that I had given notice of one amendment, and intended to move several others, but through being out of the chamber for about three minutes I lost the chance.
– Order ! I think that the_ honorable senator should make this explanation on the report stage of the Bill.
Question resolved in the affirmative. Motion (by Senator McGregor) proposed -
That the report be adopted.
– I had given notice of an amendment of some importance, and there were other amendments which I intended to move, but on returning to the chamber after an absence of three or four minutes I found that the Bill had gone through Committee. I cannot blame any one but myself, but the .Minister in charge of the Bill must know that an honorable senator cannot always remain in the chamber, and I ask whether the Government will consent to a recommittal of the first schedule. Any honorable senator who . desires to move an amendment should have an opportunity of doing so. I submit that the people who are interested in this measure should not suffer simply because I was compelled to leave the chamber for a few minutes. I was here all day waiting until the schedule would come on. When I withdrew Senator St. Ledger was deep in his amendment, and I expected that he would keep the discussion going until I came back. I move -
That the Bill be recommitted for the reconsideration of the first schedule.
– I am very sorry that Senator Stewart missed his chance. I really thought that from- the different arguments which had been advanced he had come to the conclusion that it would be of no use to move the amendment, because the Go- vernment is not. prepared to assent to it. It is one to which I have already referred in connexion with other matters. It more nearly relates to an amendment of the Old-age and Invalid Pensions Act, because its purpose is to grant pensions to the widows and orphans of those who have been killed by accident in the Commonwealth service! I know that the amendment has been circulated with a very laudable purpose, but I hope that Senator Stewart will see that it is necessary to proceed in another way. The provision would hamper and overload a Bill of this kind, and therefore I trust that he will not press his motion for a recommittal as the Government cannot see its way to support the amendment. I think that it would he only a waste of valuable time to recommit’ the’ Bill, and bring about any very lengthy argument in favour of the amendment or against it. I really thought that the honorable senator had given up the idea of amending the schedule, and was absent on that account.
Question - That the Bill be recommitted - put. The Senate divided.
Majority … 4
Question so resolved in the affirmative.
In Committee (Recommittal) :
First schedule. (1.) The amount of compensation under this Act shall be -
where death results from the injury- (i.) if the workman leaves any dependants wholly dependent upon his earnings a sum equal to his earnings in the employment of the Commonwealth during the three years next preceding the injury, or the sum of Two hundred pounds, whichever of those sums is the larger, but not exceeding in any case Five hundred pounds :
where total or partial incapacity for work results from the injury, a weekly payment during the incapacity not exceeding fifty per centum of the workman’s average weekly earnings during the previous twelve months, if he has been so long employed, but if not then for any less period during which he has been inthe employment of the Commonwealth, such weekly payment not to exceed Forty shillings.
– I move -
That all the words in sub-paragraph a (1) of paragraph 1 after the word “ sum,” where first occurring, be left out, with a view to insert in lieu thereof the following words : - “ to his widow fifteen shillings per week during her life or until she remarries and to each child ten shillings per week until it reaches the age of sixteen years.”
The object of this amendment is to provide some substantial compensation for the widow and family of a workman who has been killed, or who has died through an accident, while in the service of the Commonwealth. The principle which I should like to place before the Committee is this : If a man dies or meets with his death indirectly through an accident in the service of the Commonwealth, his widow ought to become a charge upon the Commonwealth. If a man’s life is sacrificed in the service of the Commonwealth, it is only a fair proposition to make that his dependents should be looked after by the Commonwealth until they are able to provide for themselves. The amendment does not ask for anything in the way of charity. It simply provides that the Commonwealth shall give to the widow and family a quid fro quo for the life of the father and the breadwinner. Under the schedule as it stands, the minimum amount of compensation in case of death is £200, and the maximum £500. During the second-reading debate I instanced the case of a woman left with a family of four young children, aged, say. two, four, six, and eight. Eightyears would elapse between the death of the husband and the time when the eldest of the children would be sixteen. Ten years would elapse in the case of the second child, twelve in the case of the third, and fourteen in the case of the youngest. During the whole of that time, not only would the burden of providing for those children be thrown upon the mother, but there would also be cast upon her the’ duty of earning her own livelihood, and the only assistance she would have would be the maximum amount of £500. It might be any sum between £200 and £500, but it could not be more than £500. I submit that £500, although it looks a big sum, is entirely inadequate compensation to a family such as I have indicated, for the loss of the breadwinner.
– In some cases there might be eight or ten children.
– There might. _ I am merely taking the case of a small family. To think of investing £500 for the widow and family is altogether out of the question, because, even if it were invested in Government securities at 4 per cent., which is a very high rate of interest for that form of investment, the income would be £20 only, or something like 7s. per week. So that if the money is- -to be of any benefit to the widow and family, the principal must be spent. Five hundred pounds is equal to the result of three years’ earnings of a man getting £3 per week. The widow and children can live on £2 per week. At the end of five years the compensation is exhausted, and the widow is thrown entirely on her own resources to earn a living, not only for herself, but for the children. Each of those children is of value to the community. We are anxious to get more population in Australia, and with that object the States, and the Commonwealth to a certain extent, are encouraging emigration from other countries. We ought, in the first place, to do our utmost for the children who are born upon Australian soil, and when children are deprived of their natural protector, the Government ought to step in and do all. it can for them until they are in a position to earn their own living. I think the amendment is a fair and reasonable one, and I trust the Government will see their way to accept it. The Vice-President of the Executive Council, when replying on the second reading, said the Bill was not for the purpose of paying pensions, or anything of that kind; it was simply to provide for compensation. This amendment provides for compensation, and as, by the Bill, weekly payments to a person totally incapacitated can be commuted for a lump sum or an annuity, the principle of a pension or annuity is already embodied in the measure.
– I am sure that every member of the Government, and every member on this side of the Chamber, and, I dare say, every member on the other side, would only be too pleased if we could grant pensions such as are proposed by the amendment in a time of difficulty; and not only grant them in connexion with servants of the Commonwealth, but the working sections of the community in every walk of life. It would not be fair to the workers, who have to go out into the cold blast of competition throughout the whole of Australia, and who meet with an accident or misfortune, that they should have only the State Acts to fall back on in connexion with accidents, and that the employes of the Commonwealth should be placed in such an advantageous position. Senator Stewart must remember that it is the workers in every walk of life who would have to make their contributions towards the amounts that would be distributed by way of pensions among the widows and orphans of those who had been in the service of the Commonwealth. The liberal allowance proposed to be made to the widows and orphans of Commonwealth employes is not for the purpose of enabling the widows to sit down and enjoy themselves in peace and contentment during the rest of their lives. The widow gets this compensation for the purpose of enabling her to get into some little business, or carry on some calling, until such time as her children are in a position to assist her.
– lt is a subsidy.
– That is so. It is a subsidy on account of a loss that they have sustained; and I think it will be time enough to consider the widows and orphans of deceased Commonwealth servants when we are considering the position of other widows and orphans. Honorable senators are all aware that you, sir, have a motion on the business-paper dealing with this very question, and I hope the time will come when the Commonwealth will be in a position to bring in a general scheme providing, not only for all invalids as well as old-age pensioners, but for all widows and orphans who are left in an unfortunate position. Senator Stewart has neglected to look at another phase of the question. It’ you are going to give a widow with four children, of whom the youngest is only eight, 15s. per week until she is married, she will never get married, and the very object which Senator Stewart has in view with regard to peopling Australia with young Australians will be defeated. I believe Senator Stewart is endeavouring to do something in the interests of the widows and orphans of former public servants, but before he proceeds to do anything of that kind, I ask him to consider the hundreds of thousands of other widows and orphans.
– We are not dealing with them now.
– No ; but when we begin to deal with widows and orphans, let us deal with all the widows and orphans in Australia, and not one small section at the expense of the rest. Although I should be glad if we were m a position to do this, and far. more. I ask honorable senators to consider the position of the Commonwealth. At the present time we have enormous commitments to meet, and although we may desire to do all that Senator Stewart wishes, still we should have discrimination enough to know that an amendment like this, upon such a Bill, is not the very wisest legislation that could be passed.
– I quite understand that this is such a drastic amendment that Ministers naturally feel somewhat averse to accepting it. But it appears to me that the argument of the Vice-President of the Executive Council that the widows and orphans of the rank and file of the citizens outside the Commonwealth Service are not going to receive such good treatment as the widows and orphans of public servants, ought not to carry much weight, because, taking things by and large, the position of those working in the Commonwealth Service is above the average of the same class of ability outside the Service.
– There are as good men and women outside as inside the Public Service.
– I am not saying that there are not. I am simply replying to the honorable senator’s argument. It has frequently been said that the Commonwealth should make an example of its Service in regard to the treatment of employes. Therefore, if we pay a high minimum rate during the lifetime of our employes, the argument holds good for treating their widows and orphans better than the widows and orphans of persons outside the Service are treated. Then, again, it does not follow that we should reject the amendment, because a very much larger sum than .£500 would be disbursed between the time of the supposed widowhood and the attainment of the age of sixteen years by the youngest child. Some widows would be without families. Where there were large families the presumption is that the elder children would be earning something. In the case of those who were at the age mentioned by Senator Stewart, there is no earthly reason why we should say that the widow should have just barely enough to keep both body and. soul together. The- Vice-President of the Executive Council mentioned that this Bill provides a means whereby a widow deprived of her husband by accident would be able to get into some little business to keep her and her children. But, like every other human quality, business ability is something which .everybody does not possess. There are some people who could never make a success of a business.
– I rise to order. Section 53 of the Constitution provides that the Senate may not amend a proposed law so as to increase any charge upon the people. The mimimum proposed in the schedule to this Bill is £500. That sum at 5 per cent, would return 10s. per week. Senator Stewart’s proposal is to pay 15 s. per week, which capitalized would amount to .£750. That is an increased amount as compared with the sum specified in the Bill. I submit that, according to the rulings that have been given by preceding Presidents of ‘the Senate, an amendment of this kind cannot be moved, inasmuch as it involves an increased charge or burden upon the people
– The point of order raised by Senator Chataway has been considered by me, and I am of opinion that the section of the Constitution which he has quoted does not apply to this Bill. This is really a machinery Bill. If it were ruled that Senator Stewart’s proposal could not be moved in the form of an amendment he would still be able to move a request for an amendment. But, in my opinion, the section referred to does not apply to the Bill, which does not appropriate revenue, and, therefore, the amendment is in order.
– I was alluding to the argument which has been used in regard to giving widows a sum of money with which to start businesses, and was mentioning the fact that there are many persons who are unable to make the best use of a lump sum of money.
– That is an argument against compensation being paid in any case.
– No; I am pointing out that there are many persons who are not able profitably to handle large sums of money.
If you give some people a sum of money which is not sufficiently large for them to live upon when placed in a bank or invested, they are not possessed of the business ability to handle it wisely, and in many cases widows and families would soon be in a state of destitution or no better off than if no compensation at all had been paid. In cases where large sums of money have been collected for the widows and orphans of those who have met with mining accidents - as in the instance of the Bulli disaster - it is nearly always administered by some trust or board, which pays pensions or annuities. That step has been taken because it has been found from experience that if money were paid in a lump sum it would be of little use to widows and orphans. At any rate it is not so valuable as it is when paid out periodically. For that reason a proposal to make some kind of periodical payment appeals strongly to me. The argument about the payment of a weekly sum on account of each child tending to prevent widows from marrying does not appeal to me strongly, because it a widow likes a man, and he can adequately keep her, he would probably spend a great deal more on her than 15s. a week. If she preferred the 15s. to marrying the man, she ought to keep it, and give a chance to a single girl. There is great competition among widows, at any rate ; and if a widow met a man whom she liked, I do not think she would stick at 15s. a week-. It is not such an enormous sum after all. I am not a particularly egotistical person, but I do not think my wife would care to lose me for £5,000. In regard to young families, I put this point to any one who has any knowledge of bringing up children - whether it is not a fact that both parents are necessary for the proper care and upbringing of a family. If, unfortunately, children are left fatherless, and the mother has to take the place of both parents, assistance is all the more necessary. Consequently, it is not unreasonable to accept an amendment of this kind to assist widows in bringing up their families. As to. paying a lump sum to put a widow into a business, I remind the Senate that aptitude for business does not pertain to every one, and it is not every one who can handle a large sum like £500 or £5,000. The more some people have, the more likely they are to be “ taken down “ or to squander their means. If there were a possibility of substituting a weekly allowance, I feel sure that it would be a better investment both from the point of view of the widow and family, and of the Commonwealth, than would be the payment of a lump sum.
– Senator Rae has answered Senator McGregor’s objections to my amendment, but I should like to supplement what he has said. In regard to the cost involved, I have no idea what ‘ it would be. No doubt the Commonwealth Statistician could give an estimate.
– In the case the’ honorable senator quoted, by the time the youngest child arrived at sixteen years of age the amount paid would be £1,600.
– Even so, the money would be well spent. In any case I think that when a widow and family lose their breadwinner in the service of the Commonwealth, the Commonwealth is under an obligation to see them through. The Commonwealth could not exist unless certain works were carried on ; and if some unfortunately lose their lives in the carrying on of those works, surely the widows and families of those mcn should not be called upon to endure the added anxiety of poverty and want in addition to the loss of the father in the case of the children, and of the husband in the case of the wife. The loss of the parent and the husband should be sufficient in itself, but when to this is added poverty, want, and suffering caused through that loss, the circumstances often become deplorable. If we stopped to count the cost in everything we did we should never do anything. What was the argument of the Opposition when old-age pensions were first mentioned ? They said “Look at the cost.” We waved that argument aside, and said “ Never mind the cost. These old people must be provided for. They have borne the heat and burden of the day, and we are not going to see them destitute in their old age. We shall, therefore, give them pensions.” Again, invalids who are incapacitated from earning their own living are given pensions.
– And there is a maternity allowance provided for.
– I was going to refer to it. It is open to the richest people in the land. I ask, where is the consistency of the Government in this matter? We subsidize people who do not require assistance, and the Government in this case refuse to help people who do re- quire assistance. That is wholly inconsistent with the dictates, I will not say of humanity, but of justice. We say to the rich woman, “ If you have a child, we shall make you a present of die sum of £5.” She may have an income of £5,000 a year, live in a palace, drive around in a beautiful motor car, be able to obtain the luxuries as well as the necessaries of life, and may spend upon herself and her surroundings more than would be sufficient to provide for 100 families, yet we have agreed to pay this woman a sum of money which she does not want, and at the same time we refuse to assist in any substantial or useful way the widow and orphans of a man who loses his life in doing the work of the Commonwealth. The Vice-President of the Executive Council has said that with a sum of ,£500 a widow might go into business. I have never seen anything so lamentable as the attempts of the widows of working men to make a living for themselves and their children by keeping small shops. They have no business training, are suddenly projected into a sphere of which they have, no knowledge, and, as Senator Rae has pointed out4 they become very often the victims of people who are more clever than themselves, or of their own simplicity. That argument is worth nothing, because 95 per cent, of working men’s wives have no training which fits them for business, and, further, we know that the day of the small shop is passing. The big stores are everywhere wiping the small people out. The probabilities are that the widow and family of a working man would be unable to subsist upon the profits of a small store. I am aware that there are thousands of widows who have kept stores in the past and are keeping them now, ekeing out a miserable existence in that fashion; but the opportunities in that direction are less now than ever they have been before, and are likely to be still less in the future. One other reason which the Vice-President of the Executive Council gave against my amendment was that the payment of 15s. a week to a woman for life might induce her not to marry again. That is not an argument at all. If she wished to marry, or some one wished to marry her, I do not suppose that the payment of a sum of 15s. a week would prevent the marriage. That is a matter which might very well be left to the woman herself. We have nothing to do with whether she marries again or not.
Our responsibility is to the widow and children of a man killed in the service of the Commonwealth, and according to my amendment, if the widow did marry again, she would forfeit the weekly payment. The honorable senator also said that, because we could not provide for all the widows and orphans in the Commonwealth, therefore we ought to provide for none.
– I never said anything of the kind. I said that when we were providing for them all we could take these into account.
– I remind honorable senators that the people of the Commonwealth have a responsibility to the widows and orphans of men killed in their service which they do not owe to each’ other. They have an added responsibility in the case of those who were dependent upon persons killed in the execution of work carried out for them.
– Would the honorable senator not include other dependents such as fathers, mothers, and mothersinlaw ?
– No, I would not. The honorable senator is now trying to make the thing ridiculous. If he cannot accept the amendment he oughtat least to treat it in a serious manner. We cannot at present provide for the widows and orphans throughout the Commonwealth, but I hope that the day is not far off when we shall do so. There is a motion on the business paper of the Senate at the present time dealing with that matter, and if it goes to a vote I shall support it. I say that the widows and orphans of the Commonwealth should be a charge upon the people of the Commonwealth. Human life is of more value than is anything else to the Commonwealth, young life more especially, because it is upon the young lives that the stability and safety of the Commonwealth depend. I trust that honorable senators will not be led away by the arguments of the Vice-President of the Executive Council, but will do the right thing by voting for my amendment.
Question - That the words proposed to be left out be left out - put. The Committee divided.
Majority … …. 4
Question so resolved in the negative.
– I wish to move another amendment in sub-paragraph b of paragraph 1 of the first schedule. I shall first of all state to the Committee the object I have in view in submitting the amendment. The provision as it stands provides for a weekly payment during incapacity of a sum not exceeding half the average weekly wage of the workman during the previous twelve months. Under the amendment I wish to move the workman would receive the whole of the average weekly wage for the first month during which he is incapacitated, and half that wage for the period that came after. One reason why I move the amendment is because I think that men who meet with accidents in the Public Service ought to be treated at least as considerately as are members of the Public Service who become sick, and are unfit to attend to work for any particular period. Regulation 77, under the Public Service Act reads -
Application for leave of absence on the ground of illness shall be supported by the certificate of a duly-qualified medical practitioner.
The Chief Officer in cases of sickness or illhealth may, on production of satisfactory evidence, provisionally grant extended leave not exceeding three months in accordance with the following schedule ; but a schedule of all leave granted under this regulation shall be submitted monthly for the approval of the Minister, who may in any case disallow the leave so granted : -
If a servant has been over five years and under ten years in the employment of the Commonwealth, he gets full pay for two months and half-pay for one month, and if he has been over ten years the full pay is for three months. I think that men injured in the service of the Commonwealth ought to be at least treated on an equal basis with servants who become sick in the ordinary course of events, and have to leave through sickness. That is all that is claimed in my amendment. Honorable senators will, 1 think, see that it is a perfectly fair proposition. If the amendment which was carried here the other day is agreed to by the other House, all that a person injured will be able to claim from the moment of injury will be half his wages ; whereas under the Public Service regulation, if a man takes influenza, and has to go home, that is, with a doctor’s certificate, and receives leave of absence for a month, he gets full pay for a month. Surely men who meet with an accident in doing the work of the Commonwealth ought to be put on as liberal a basis as its other employes. In the first place, I move -
That after the word “during” in subparagraph b of paragraph 1 the words “ the first month of “ be inserted.
I shall take a division on that question. Honorable senators know exactly what I am driving at. My proposal means that the workman will be paid his full wages for one month instead of half wages during the whole period of his illness.
– I hope that Senator Stewart will not persist in his amendment. We have endeavoured to make this Bill as liberal as we possibly could. Very often disaster occurs when a Bill like this is loaded. It causes delay, and we do not know where finality may be reached. In this Bill, we provide for a . payment up to £2 a week, whereas the State Acts only provide for a payment of half the employees wages, and not to exceed£1 a week. We provide for double that amount. I think that our Bill is fairly liberal, and I ask honorable senators to look at the matter from that point of view. We have wasted a good deal of time.
– Wasted !
– I consider that all time is wasted which is not effective in its results.
– Then many a day you have wasted.
– Necessarily some time is wasted. I know that the honorable senator is not submitting this proposal for that purpose. I ask honorable senators to remember the liberality of this legislation in comparison with any other legislation of the same character in any part of the world.
– I do not want to waste time, but I certainly think that Senator Stewart deserves thanks from the Senate for the care and attention which he has bestowed upon this Bill. What strikes me in connexion with his amendment is that if at present the Public Service regulation provides for payment for one month in the case of sickness, subject, of course, to the Minister’s right of disallowance, which, 1 suppose, is very rarely exercised, and is practically a dead letter. It will be a very difficult thing, if we have a different rule” applying to another case, to always draw a distinct line where sickness can be separated from accident. There should be a distinct value in having a uniform practice for sickness brought about by ordinary causes.
– The regulation will not apply to a large number of the men who may be injured in the service of the Commonwealth, because they will not be permanent employes.
– That is not quite the point I mean.It may lead to some injustice, if not confusion, in the administration of the Public Service, unless the honorable senator’s amendment is adopted, because one class of men is on a different footing from another class. There are provisions whereby, if an accident is caused by wilful negligence on the part of the employe, he may not receive consideration. I mean that it will not be an absolute payment in all circumstances. There are qualifications which will deprive a person of the benefits under this measure. If we take an ordinary accident, which is not due to a person’s own fault, but to any one of a thousand and one causes, it is really more deserving of compensation than is an ordinary illness. I maintain that, in a very large measure, ordinary sickness is a person’s own fault. If a man has anything like a decent constitution to start life with, and pays due attention to what he eats, drinks, and wears, and to exercise, it is very largely his own fault if he gets ill.
Perhaps this is a bit ahead of the subject, but I look to the future, when it will be considered absolutely criminal on the part of persons to be ill, and to be a punishable offence.
– What great men you would kill !
– I refer to those who start fairly, of course; there are many eminent men who start with a poor constitution. So much sickness is brought on by indiscretion in eating, drinking, and many other causes, that a person who is suffering from an unavoidable accident is a more deserving subject for remuneration and ade quate treatment than are many persons who may assist in bringing about their own illness by indiscreet methods of living. Ordinary accident is more deplorable than ordinary sickness, and in many cases is far more deserving of commiseration and adequate treatment. It may lead, I repeat, to confusion in the administration of the Public Service when we find one system governing one set of employes and another system of calculating compensation provided for the other set.
Question - That the words proposed to be inserted be inserted (Senator Stewart’s amendment) - put. The Committee divided.:
Majority … … 3
Question so resolved in the negative.
Bill reported without further amendment; reports adopted.
Bill read a third time.
Bill received from the House of Representatives ; Standing Orders suspended ; Bill (on motion by Senator McGregor) read a first time.
Motion (by Senator McGregor) proposed -
That the Senate Jo now adjourn.
– I desire to ask the Minister of Defence if he can give any explanation of the long delay in receiving the promised report about the alleged flogging or caning of a cadet who attended the Sydney Grammar School. The incident occurred some time ago, and as the officer concerned and the place where the incident occurred are within a short distance of one another, it seems - peculiar that there should be any circumlocution about getting a report on the matter. It looks to me as though some of those concerned were trying to concoct some feasible story before they let the Minister know their version of the incident. It is also stated - I do not know with what degree of truth, but the statement has appeared in, the Sydney press - that a cadet named Wall was punished by the adjutant and some other officer.
– Do you know what area ?
– I do not, but I think I could get the information. It is stated that the same officers who are concerned in the case of the Sydney Grammar School boy are also concerned in the case of this lad, who is the son of a widow, and is working for the Fresh Food and Ice Company in Sydney. The charge against him was that he had repeated an order given by his officer. It is said that the officer had given the order “ Shoulder arms,” “ Present arms,” or “ Order arms,” and the lad afterwards explained that he merely repeated it in order to memorize it, and did not mean it as an insult to the officer. For this alleged offence, the adjutant and another officer arrested the lad and took him to the barracks, and caused him to be flogged. When he returned home, his mother saw that he was in some pain or trouble, and questioned him, but he refused to give her any satisfaction. After he was asleep in bed, however, she examined him, and found great weals on his body, which had been inflicted by a stick or cane. She was urged by her neighbours to take the matter to Court, but she did not like to. Many people do not care about going to the Law Courts. The statement is that this officer said to the lad that he could either be prosecuted and fined, or take a flogging. The lad replied that he was poor, and could not afford to undergo a prosecution, and so the two officers flogged him. Whether the story is a true one or not, I do not know ; but investigation of these matters should not be delayed. If there is going to be strict military discipline and prompt obedience by cadets of the orders of their officers, there should also be prompt action with regard to officers who are guilty of this kind of conduct. If the facts are as alleged, the officer should be dismissed from the service. If we are going to introduce the old system of flogging into our Defence Force, it will soon burst up the show, and those who share my feelings will help to do it. I am not putting this forward as fact. I am merely making the statement as it has been reported. What I want to know is the reason for the delay that has occurred in connexion with the report on the matter.
– This is the first time that case has been mentioned.
– I am not so unreasonable as to blame the Minister for not taking action regarding a matter of which he has no knowledge, but I do say that there has been delay in connexion with the other case.
– I should like to complain of the unnecessary delay that has occurred in connexion with an investigation which the Minister promised into the prosecution of cadets in Hobart, several weeks ago, and which was brought under his notice at least three weeks ago. I refer to those prosecutions in which the cadets concerned alleged that they were prevented from, attending the statutory drills owing to the fact that the Deputy Postmaster-General at Hobart would not give them the time off. Some difficulty may have occurred to prevent the Minister getting the information placed before the Senate, but there seems to have been too much delay altogether, and it would appear as though the Senate were going to rise without the information. If the statement is true, I think that the official concerned is entitled to the strongest censure by the Minister controlling his Department, and strong measures ought to be taken to prevent one Department coming into direct conflict with the administration of another very important Department. I urge the
Minister to supply us with information as to the truth or otherwise of the statement at the earliest possible moment.
– Senator Rae brings forward a complaint regarding an alleged delay in furnishing a report on a case which was brought under my notice, I think, about a week ago. Honorable senators know that we have not a system of centralization. We have attempted to decentralize ; that is to say, officers in New South Wales are under the Commandant of New South Wales, and, as far as discipline is concerned, administration is not carried out from Melbourne. When a case like this is reported, I bring it under the notice of the Adjutant-General. He then has to instruct, the particular Commandant to get a report, and the Commandant has to call upon the Area Officer to supply a report.
– The old circumlocution.
– There is no other way of doing it. The Commandant is on the spot, and can deal with discipline there, but the case does not come immediately under his notice. It has either been reported by inspectors to him, or it comes under my notice, either by letter or by representations made by a member. It can easily be seen that when a case is mentioned here it takes some little time to bring it under the notice of the Commandant, and for a report to be furnished by the Area Officer.
– Each one should not take his own time-
– No, and I do not think Be does. The Area Officers are not permanent officers; they are not permanently paid, and they can only do the work in a certain portion of their time. Delay often occurs in dealing with officers who are not permanently employed. In regard to the. other case Senator Rae must recognise that it first came under my notice to-night. I have no personal knowledge of the facts. I cannot assume that they are correct. The ‘honorable member would not expect me to do so. I must send the matter on for report. As to the honorable senator’s remarks about the practice of flogging, I can assure him that while I am Minister there is no danger of any such thing being _ permitted. No military officer can bring in such a system unless the political head of the Department allows it. I will see that the reports on the two cases are obtained as early as possible.
– I did not export that the Minister would sanction flogging, but will he see that nothing of thekind is done without sanction?
– It the cases, are proved the officers responsible will be severely dealt with. There is not the slightest doubt about that. With regard to Senator Long’s complaint, the question to be dealt with is 4: complicated one. It concerns the Post and Telegraph Department as well as the Defence Department.As far as my Department is concerned, I have had inquiries made, and the report came to me yesterday. Inquiries were made from the cadets concerned, and thev have made written statements to the effect that they were prevented from attending drills. Now we are sending on the reports to the Postmaster-General in order that lie may get the- statements of hisofficers 011 tlio charges made.- It would not be right for me to assume that the statements are correct until the officers of the Post and Telegraph Department have made their statements. I have no right to call upon them for reports, but as sooit as I received the papers I minuted them- tobe forwarded to the Postmaster-General, asking him to inform me whether thecharges are correct, and what his officers had to say about them. I also minuted’ the <papers that the matter is urgent. Sothat everything that can be done has been done. The Defence Department is not solely responsible, nor can we accept the statements of the cadets without giving the officers against whom the charges are made an opportunity of replying. As soon as a reply is received from the PostmasterGeneral I will make the information available.
Question resolved in the affirmative.
Senate adjourned at 10.47p.m.
Cite as: Australia, Senate, Debates, 10 December 1912, viewed 22 October 2017, <http://historichansard.net/senate/1912/19121210_senate_4_69/>.