9th Parliament · 2nd Session
The PRESIDENT (Senator the Hon. T. Givens) took the chair at 3 p.m., and read prayers.
– I desire to ask the Minister for Home and Territories (Senator Pearce), without notice, if it is a fact that, owing to the delay in the preparation of the subdivisional plans of the building leases at Canberra, it has been decided to postpone the sale of the leases? If tha-t is the case, who is responsible for the delay, and has the date of the proposed sale been fixed?
– It has not been decided to postpone the sale. I am awaiting a report from the Federal Advisory Committee as to the present position before again bringing the matter before Cabinet.
The following papers were presented : -
Northern Territory - Ordinance No. 15 of 1924- Crown Lands.
Report to! the League of Nations on the Administration of the Territory of New Guinea from 1st July, 1922, to 30th June, 1923.
asked the Minister representing the Minister for Trade and Customs, upon notice -
– No alteration is contemplated at present.
asked the Minister representing the Minister for Trade and Customs, upon notice -
Have the Government come to any decision regarding the disposal of the s.s. Gunemba, or do they intend to allow her to remain in the Brisbane River to accumulate barnacles T .Senator’ WILSON. - The vessel in question was disposed of by public tender to a private purchaser oh the 2nd October, 1923.
Colonel AINSWORTH’s Report.
asked the Minister for Home and Territories, upon notice -
– The answers are -
asked the Minister representing the Prime Minister, upon notice -
– The answers are -
General Sir N. MACREADY’s Statement.
asked the Minister representing the Minister for Defence, upon notice -
– The answers are - 1. and 2. The High Commissioner has already refuted the statement, and it is not thought desirable to give any further publicity to the matter.
Motion (by Senator Pearce) proposed -
That tho Bill be now read a third time.
.- When the Minister for Home and Territories (Senator Pearce) submitted this bill to the Seriate a short time ago he stated that the Public Service Board was so submerged in its work that it was imperative in its interests and in the interests of proper classification that this bill, which is to amend the act of 1922, should be passed as quickly as possible.
I wish to emphasize the statement I made during the second-reading debate that tho act of 1922 specifically set out the duties of the board. The board, it provided, should, amongst other things, classify the Service, and that having been ‘ done the classification was to be published in the Commonwealth Gazette, so that the Com.monwealth public servants would have the opportunity to peruse the scheme, and, if so disposed, to submit appeals to the right quarter. Before the classification had been completed, however, the board has approached the Government, and has said that its powers are not sufficiently drastic - that it requires additional powers. To do what? What no Public Service Commissioner has been able to do since the inception of federation and the establishment of the Commonwealth Public Service. The board is doing its work, it is true, but not to the satisfaction of a considerable section of Commonwealth employees.. It is freely stated that it has given generous consideration to public servants in receipt of high salaries, but it is an actual fact that the salaries of. those, on the breadandbutter line are to be further reduced. The members of the Labour party will not countenance such action. We also enter a vigorous protest against the action of the board, in regard to the classification of certain Commonwealth public servants. I have a letter - J expect other honorable senators Have received a similar communication - from the branch secretary of the Postal Sorters Union of Australia. Ho puts forward a plain statement that cannot be- contradicted. He says -
In the case of members of this union, the classification proposals provide for reduced rates of pay ranging up to £10 a year, in the majority of cases, and the creation of an additional efficiency test to qualify for advancement beyond £252 a year. In other words, the proposals referred to aim to obtain a higher standard of efficiency on the part of the employees by .the remarkable expedient of reduced rates of pay.
The claim; of the board that higher efficiency among the postal sorters will be obtained by a reduction of their wages will not bear examination, and the postal sorters are not the men I have always taken them to be if they stand for this sort of treatment. In my opinion the best way to get good results from men in the Public Service is to treat them properly. Many of them, instead of having their wages reduced, are entitled to increases.
– The decrease proposed by the board is quite unjustifiable. In. some cases it amounts to £10 a year.
– If members of the Public Service Board, heads of departments, or Public Service inspectors, who are all well paid for their services, were on the bread and butter line, how would they view a proposal of their bosses to cut down, their wages, at a time when the cost of living was increasing., in order to make them give better service ?’ A short time ago the Public Service Arbitrator heard the claim of the Postal Sorters’ Union for increased wages, and, after an exhaustive and costly hearing., delivered an award that gave- the sorters .£238 a year, with annual increments, of £8’ a year until their wages reached £286 a year. The Public Service Board now proposes to reduce these rates. If. it has the power to do so, what good purpose is served by having a Public. Service Arbitrator ?
– Can the Public Service approach the Public. Service Arbitrator after the board has made its classification ? I am asking because if they could do so, it would be a neverending process, like a dog chasing his tail.
– Exactly. There would be no way of reaching finality. I want to know what right the Public Service Board has to alter an award, and reduce wages. The cost of living has increased since the award was made, so that instead of having their wages reduced, the men should have had them ‘increased.
– Can we deal with that reduction of wages by defeating the third reading of the bill?
– No, but the defeat of the bill would be an intimation to the Government to tell the Public Service Board to stay its hand. Apparently, the knife is being utilized ‘ ruthlessly, and always against men on the bottom rung of the ladder. We have been informed in the public press, this morning, that the adoption of some of the proposals of the Public Service Board will create a big army of unemployed, that men with long periods of service who have apparently given every satisfaction up to the present will be dismissed, and that the wages of others on the bread and butter line will be reduced.
– The honorable senator is not advocating the re tention in the Service of men for whom there is no proper employment ?
– I am doing nothing of the kind’.
– Then where does the -honorable senator’s reference to unemployment apply?
– I do not admit that there are in the Commonwealth Service to-day men who are not doing useful work, and I flatly contradict a statement made by a Minister that there are men in the Service who are being paid for doing nothing.
– BROCKMAN - Of coarse, the honorable senator is in a better position to know than the Minister.
– It is only natural thai the Public Service Board., in order to justify its existence-, will- make out that there are excess officers, in various departments; but my view is that with the gradual extension of. the functions of the Commonwealth, and the creation of additional departments, the Service will need to be’ increased rather than decreased. Awards by an Arbitration Court aire binding on all private employers. Why should not an award made by the Public Service Arbitrator be binding, on the Government and on the Public- Service Board ?
– It is a serious reflection on the Public Service Arbitrator if his awards are not binding.
– The reflection is not on the Public Service Arbitrator, but on the Government who appointed him, and also appointed the board. Do Ministers propose to stand idly by and allow this business to go on - on the one hand a Public Service Board saying, “ We shall proceed on our way “; and, on the other hand, the Public Service Arbitrator saying, “ I shall proceed on my way;” with no possibility of finality “being reached. However, I have entered my protest against certain phases of the classification put forward by the Public Service Board, and against the way in which certain sections of the Public Service are being treated. I hope the Government will, give some attention to the case I have made out on behalf of the men in the lower ranks of the Service:
– I feel strongly on this matter, in view of representations made to me from many centres of the state that I have the honour to assist in representing. The only point I am concerned about is the reduction in salaries, affecting more particularly the postal sorters, that has been brought about contrary to the decision, after the fullest possible inquiry, of the Public Service Arbitrator. The postal sorters’ organization went to the arbitrator with certain claims in regard to wages and working conditions. These men were represented before the arbitrator, and they had the fullest possible opportunity to state their case, as it appeared to them, in a fair way, and after an exhaustive inquiry the arbitrator gave his decision. The classification of the Public Service Board provides for rates of pay from £240 to £276 per annum, obtainable by annual increments of £6, with a qualifying test for advancement beyond £252 - a perfectly fair decision, under the circumstances. The rates of pay fixed by the arbitrator are from £238 to £286, obtainable by annual increments of £8. It will be seen that the postal sorters have been classified for a reduction of £10 on the maximum salary, while the yearly rate of increments has also been reduced, and an extra efficiency test has been prescribed for men on the £252 mark. The rates fixed were based on the Commonwealth Statistician’s cost of living index number 1642 for the twelve months ended June, 1923. For the twelve months ended March, 1924, the index number increased to 1720, which warrants not a reduction in salary, but an increase. It seems to me that, if the Government is to recognize the principle that the wages paid to its employees in the lower grades are to be fixed in accordance with the cost of living, there is a lot in the contention of these men that, instead of their wages being reduced, they should have been increased. I consider that the decisionof the Public Service Board imposes a considerable hardship on these men, and I cannot endorse it in any circumstances. If the board had left the rate of salary as it was, the decision would, perhaps, have been bad enough, in view of the increased cost of living, but to impose an efficiency test, and also reduce the salaries by £10 per annum, seems quite unjustifiable. I desire to add my protest to that voiced by Senator Findley. I hope that, the Government will indicate to the Senate that it also recognizes the injustice of the decision, and intends to take some action to alter it.
– I also protest against the action of the Public Service Board in this instance. The Public Service Arbitrator was appointed for the purpose of relieving the pressure that existed in the Commonwealth Arbitration Court. Had the award been given by that court; it would not have been questioned by the Public Service Board. It was understood that the arbitrator was appointed to make awards in exactly the same way as the Commonwealth Arbitration Court, and the action of the board in this case is outrageous. Not only do honorable senators on the Opposition side feel strongly on the matter, but I believe that honorable senators on the Government side generally take the same view. Having regard to the cost of living at the present time, and the buoyant condition of the Commonwealth revenue, it is altogether unfair to reduce the’ wages of men in the lower-paid branches of the Service. Bather than reduce their salaries, we should consider whether we could not make their lot easier than it now is. If it would benefit these men to vote against the third reading of the bill, I should adopt that course, but it would be of no use. I hope, however, that the Government will take notice of the protest made.
– The opinion among honorable senators seems to. be general that the postal sorters have not had a fair deal. A fear has been expressed, and I think it is well grounded, that if the third reading of the bill were defeated, no good object would be served. But I think there is a way in which honorable senators who have spoken against the board’s proposal may achieve their end, and that is by recommitting the bill in order to insert a new clause. I therefore move- -
That the bill be recommitted, with a view to inserting a new clause, to follow clause 7, as follows : - “ That in every case the Public Service Commissioners shall observe, the awards given by the Arbitrator.”
It has been represented to me by a number of employees in the Public Service, all of whom are receiving what appears to be a very small salary, considering the present hard times, that they are being unfairly treated. It has been pointed out that the latest classification provides for rates of pay from £240 to £276 per. annum, obtainable by annual increments of £6, and that a qualifying test is to be applied for advancement beyond £252. Considering that the rates of pay fixed by the arbitrator are from £238 to £286, with annual increments of £8, it will be seen that these men are to be subjected to a reduction of £10 on the maximum salary, and the yearly rate of increments is to be reduced, with an extra efficiency test for men on the £252 mark. It is Surprising that, while these conditions are to be imposed on men in the lower grades of the Service, nothing of the kind is suggested in regard to those in receipt of higher salaries. A good deal of discussion has taken place in Various parliaments in Australia at different times with regard to the basic wage. For a time I was under the impression that the idea was to apply the basic wage in such a way that men who were receiving less than a living wage would be given a sum sufficient to ensure them the necessary standard of comfort. The basic wage certainly achieved that object, but it also had the effect of increasing substantially the salaries of persons who were receiving up to £500 per annum. The alterations proposed will affect very harshly those public servants who are receiving small salaries. Some time ago, I understand, the Postal Department issued .regulations insisting that householders should provide letter boxes, the idea ‘ being that letter carriers would thereby be able to cover larger rounds than at present are possible. I believe that it is also intended that the letter carriers shall deliver parcels in their spare time. I have no doubt that this classification will apply to those officers. The time is opportune for those who are opposed to this action not only to voice their opposition, but to take a practical step to defeat it.
– The Government, for several reasons, cannot accept the amendment. It is obvious that Parliament would stultify itself if it agreed to such an amendment. Parliament has appointed two bodies, each having separate and distinct functions, but those functions relate to the same officers at different times. A Public Service Board has been appointed, which has had delegated to it certain powers. Senator Findley is quite wrong in thinking that the only duty of the board is that of classification.
– I did not say that.
– If he reads section 17 of the principal act he will find that the classification of the Public Service is ‘only one of the board’s functions. By an act of the Parliament of the Commonwealth a Public Service Arbitrator also has been appointed. That gentleman performs in relation to the Public Service the same functions that the Arbitration Court performs in relation to the industrial section of the community outside. He is a court of appeal to which the employer and the employees may submit claims regarding wages, hours, or conditions of labour. The employer in this case has delegated to the Public Service Board the function of classifying and of fixing the wages and hours of the Public Service. If public servants are dissatisfied with the classification of the Public Service Board two courses are open to them. The Public Service Act lays it down that they may lodge an appeal against the classification, and, in addition, the associations representing the various classes or grades of the Service are vested with the power to appeal to the Public Service Arbitrator. That power of appeal still exists. If Parliament agreed to the amendment it would say in effect, “ We have appointed these two bodies, but we now say to the one, ‘ In drawing up your classification scheme you shall not exercise any choice or judgment, you shall be bound by the ‘ decisions of the Public Service Arbitrator.’ “ What Senator Grant has not foreseen is that his proposal will cut both ways. He has his eye only on the reductions that are alleged to have been made. Senator Findley admitted that in certain cases increases had been granted, but he wrongly stated that the increases were given only to the higher salaried officers. The amendment would prohibit the Public Service Board from granting increases. If the view expressed by Senator Grant is the view held by Parliament, it should say, “ The classification of the Public Service is the duty of the Public Service Arbitrator. Why have two bodies dealing with the one . matter? Wipe out the power to classify the Public Service and to fix salaries that is vested in the Public Service Board.”
– Is not every outside employer bound by the awards of the Arbitration Court?
– Of course he is; and so is the Government. Parliament has legislated to give the Public Service Board the power to classify, but that is’ not all that it has done.
– Can the Minister state whether, in this particular instance, the wages actually paid will be the wages stipulated in the Arbitrator’s award, or those fixed under the classification of the Public Service Board?
– The wages will be paid according to the classification of the Public Service Board until they are altered on appeal to the Public Service Arbitrator.
– In ‘ this case public servants are to be paid less than the wage awarded by the Public Service Arbitrator.
– That is so in some cases; but in other cases they are to be paid more. It is but natural to expect that these two bodies will not think exactly alike. The classification has revealed that they do not. The Public Service Board has thought fit to disregard what the Public Service Arbitrator did previously in two directions. It is alleged that the board has, in some cases, reduced the salaries. It is further alleged that in other cases the board has increased salaries. If the view of Parliament is that the Public Service Arbitrator alone should fix salaries, the Public Service Act should be amended in that direction.
– If the members of the Public Service appeal to the Arbitrator, is the Public Service Board bound by the decision of that gentleman?
– The Government is bound by the decision.
– ‘What then becomes of this power of .the board? That power is taken from it.
– It is to the extent that it is interfered with by an award given later by the Arbitrator.
– The Public Service Board has ‘taken away from public servants the award of the Arbitrator, but the Arbitrator can restore it to them?
– That is so, and there is a reason for it. I remind the ‘Senate that the Public Service Arbitrator never has before him, at the one time, the whole of the Service. He has before him at different times certain sections of the Public Service, and he proceeds to fix wages and hours of labour, having regard to the circumstances, and on the evidence produced to him at that particular time. In a classification of the Public Service the board reviews the whole of the Service at the one time. Having regard to the relative value of the services rendered by the various sections, it brings in a classification scheme for the whole of the Service, which then starts de novo from the adoption of the classifi-cation. The various .organizations can, if they choose, avail themselves of the Arbitration Court, and bring the interests of the various sections up for review.
– Then the amendment would make for immediate uniformity.
– It would not make for uniformity at all. The classification of the board makes for uniformity. That classification may be wrong, but, at all events, it is uniform, since it covers the whole of the Service. The amendment, if adopted, would absolutely stultify the will of Parliament as expressed in the two existing acts. In the circumstances, I trust that honorable senators will not accept it. If they take the view that there should be only one authority to deal- with the Service there is another way of securing that end,, and that is by an amendment of the act in that direction.
– The amendment as submitted by Senator Grant is scarcely in order. It would limit the committee to the exact wording of the proposed new clause. The committee would not ha-ve power to consider what the new clause should or should not be; and that would be contrary to the honorable senator’s intention. I have pointed out to Senator Grant that the proper method is to move for the recommittal of the bill, with a view to inserting a new clause to follow clause 7. If the amendment is so framed and is agreed to, it will leave the committee perfectly free to insert the proposed new clause in any form it chooses. Senator Grant, I am .glad to say, has agreed to alter his ‘amendment, and he asks leave to withdraw it so that he may submit it in the form I have suggested.
Amendment, by leave, withdrawn.
Amendment (by Senator Grant) proposed -
That the bill be recommitted for the consideration of a new clause to follow clause 7.
– I listened very attentively to the Minister (Senator Pearce). When he seriously addresses himself to a subject he is always worth listening to. He has informed us that the present act expresses the will of Parliament, and in reply I remind him, as Senators Findley, Duncan, and Grant have already done, that the interpretation of the act is in conflict with the intention of Parliament. Parliament now has an opportunity of asserting that the Public Service Arbitrator’s awards shall b& final. If we recommit the bill and insert the. suggested amendment it. will go to the other House, and I venture to say that 9.0 per cent, of its members will be in favour of that amendment. It is not. desirable that, after the Public Sendee Arbitrator has inquired into the conditions of the Public Service and decided, what are fair rates of wage and conditions of work, the- Public Service Board should, by an interpretation, of the act, evade, the award.
– Both sides will have a chance to put their views before the Arbitration Court.
– The proposed new clause will be an intimation to the Public Service Board that Parliament has definitely decided that the decision of the Public Service Arbitrator shall stand. At present all the difficulty is caused by one side claiming that the other will not obey the awards of the court. In November last an award was given, and the men interested had to wait until April before it could be given effect to.
– What award, was given in November last? Awards are made every month of the year.
– The Postal Sorters award was given in November last.
– Senator Pearce asks what award was given in November last. In reply, I inform him that an award was given dealing with the men who are’ now complaining of being reduced, contrary to the provisions of the award.
– One section only. Senator GARDINER.- I hope the Minister will be fair. Because Parliament’ was not sitting at the- time, immediate1 effect could not be given to the award. It had to be laid on the table of Parliament. The men concerned had to wait until April. This was not a fair thing for the employees. I appeal to honorable senators to put. themselves in the place of these men. They had financed their organization,, had defended their claim, and had got an award. Then they had to waitnearly six months before it could be given effect to. It became operative in April, but before the end of July the Public Service Board arrived at a classification which took away the advantage gained by the men from the court. Thisis not a party matter at all. I am not speaking with the object of embarrassing the Government. I have met these men, who have put their case before me. One section: told me that the reclassification took away £9 from each member of the organization, taking into consideration the arbitrator’s award and the annual increments. Then there was the question of the test examinations, which was raised by Senator Duncan, who pointed out that, before men who were on the £252 a year mark could advance to the higher grades,, they were required to pass an extra test examination. That is not quite fair. If a man is at the top of his classification, if he has rendered faithful service over a long period, of time, it is not reasonable to ask him to pass a test examination before he can secure an increase in salary. This is only another way of preventing the arbitration award being given effect to. The amendment will give the Senate an opportunity of redressing the grievances of the poorlypaid public servants. Men getting £252 a year certainly cannot be regarded as- well paid,, in view of the present cost of living, and they should not be subjected to a reduction in pay. I know the statement was made in- another place by a Minister, in answer to a question, that the Public Service should be satisfied, because the reclassification had added £20,000 a year - I speak from memory as: to the amount - to the total annual expenditure. I am not going to question the Minister’s statement as to the amount, but I suggest that it is. little consolation for a man whose salary has been reduced £6 or £8 a year to be told that, as far as the whole of the Public Service is concerned, the classification has increased salaries by £20,000 a year. Such arguments are of no use, and the treatment of public servants in such a way is very undesirable. I do not think that, public servants generally throughout the Commonwealth, particularly the Commonwealth public servants, have ever been adequately remunerated. There may be a few officers who are holding comfortable positions, but, as far as others are concerned) - I do not care whether they are in the top, the intermediate, or lower grades - they have never had the rewards for service available to those outside. In this instance, we are dealing with hundreds of men who, to use a familiar ‘expression, are on the bread line, and who, judging by the figures of the Arbitrator, are not receiving more than a living wage. Some of them have been in the Service for 20 or 30 years, and the highest salary they can receive is £278 or £286 per year. I ask the Minister, in all earnestness, to agree to the bill being recommitted. The whole question could then be considered, not as a party one, but on its merits.
– It is a non-party, question.
– If those honorable senators who are loyal to the Government intend to support the Minister, I have nothing more to say.
– Or if those loyal to the Opposition vote en bloc, as they always do.
– I am quite sure that the Minister misunderstood .what I meant.
– The honorable senator is making an appeal for votes to honorable senators on this side.
– I have great respect for those who support the Government of which they are followers, irrespective of the position, but I ask, apart from any desire that any one should be placed in a false position, that the bill be recommitted. The whole matter could then be debated. If the proposal is considered unsound, it can be thrown out, but any action taken should be irrespective of party. This matter has arisen very suddenly. It was not arranged by the Opposition. Honorable senators opposite have received a communication similar to that received by honorable senators on this side. There has been no organization on our part to submit the amendment. I appeal personally to the Minister to support the recommittal of the bill, because if he will not oppose the recommittal, the whole matter can be decided in committee. If that course is agreed -to, I shall abide by the result whatever it may be. The action of the board, in this instance, can be repeated in connexion with future awards. The Minister has stated that the public servants can again appeal to the Arbitrator. They could, of course, appeal, say, next month, and the decision of the Arbitrator could be given a week after Parliament adjourned, but as. Parliament might not reassemble until March, one can easily imagine the position in which they would be placed if the decision were in their favour. If a new award were made, it would have to lay on the table of the Senate for a specified period before it would become effective.
– If they already have an award, why should they again have to appeal to the Arbitrator?
– That puts the whole position in a nutshell. The Senate will settle the matter as far as this branch of the legislature is concerned, and if the proposed amendment is adopted, it will go to another place for consideration. If after full consideration has been given to the question, Parliament decides that the award shall stand, the men concerned will not suffer. We should then have finality; and we should have a satisfied and contented Service.
– And take away one of the principle powers of the board - the power of classification.
– That is a ‘ power which Parliament ‘creates. Parliament has never given away its own powers. We have the power of creation, construction and abolition, and if we have created a Public Service Board, with the power of reclassification, that power should not extend to the alteration of awards. If the board is to follow a system under which an award which has been in operation only since April can be upset, it is time an alteration was made. I wish to regard the members of the board as gentlemen worthy of the positions they occupy, and’ not as men trying- in an underhand way to do what the arbitrator would not openly let them do. If the board is interfering with awards without evidence before it, all I can say is that it is misinterpreting the intentions of Parliament, or misinterpreting its powers as a board. Parliament now has an opportunity to insert a clause in the bill, under which the powers of the board can be made perfectly clear. The members of the board, apparently, imagine that by a system of reclassification they can go outside an award. That may not be their intention, but it would appear to be so. Classification of the Service can be conducted in such a way that the award of the Public Service Arbitrator is altered, and such a practice should not be allowed to continue. In every capital city in the Commonwealth there is a large body of men already up in arms against the actions of the board. It is unwise to have public servants in every state seething with discontent, and seeking an opportunity to obtain justice. I am glad that the opportunity has arisen at this juncture to consider their grievances, and I trust the Minister will not divide the Senate but will consent to the bill being recommitted, so that an amendment may be framed which will meet with the approval of the committee and which will, I think, be acceptable to another place. Public servants should not receive a lower salary than the Public Service Arbitrator granted them. This is not a party move. I did not know on what particular phase of the question Senator Findley intended to speak, and I was not aware of the form in which Senator Grant’s amendment was to be submitted. I agree with Senator Duncan that it is’ necessary that we should have finality. We stand for arbitration, and we desire arbitration awards to remain in existence until amended by the authority which made them. Satisfaction in the Public Service can be obtained only by paying adequate salaries and working under a system in which finality can be assured. I trust the Minister will allow the question to go on the voices, so that we may get into committee, and there insert a clause expressing the opinion of the Senate based on the latest information before us.
– It is my intention to support the motion for the recommittal of the bill, because, as I understand from the explanation of the Minister (Senator Pearce), the present position intro duces a harassing and totally unnecessary stage into the procedure whereby public servants are prevented from obtaining an adequate and proper salary for the service they render. The Minister stated that if after reclasisfication a public servant is dissatisfied, he. has the’ right to appeal to the tribunal which has already considered his case. Why should not the Public Service Board observe the awards .already given? These appeals are unnecessary and harrassing, and, I venture to say, extremely .expensive, as the time of public servants and the Arbitrator is wasted. Knowing that the bulk of our public servants are under-paid, I am glad to be, in this instance, at any rate, in agreement with the Leader of the Opposition. As far as I am concerned, this is not a party matter, and I am not going to regard it as such. The recommittal of the bill meets with my approval, and, if an amendment be submitted in the form, suggested, I shall also support it.
– 1 intend to support Senator Grant’s1 motion for the recommittal of the bill, and sincerely trust that the Government will agree to that proposal without further1 discussion. The Minister (Senator Pearce) has stated that by agreeing to’ it we shall stultify a previous decision of Parliament. If we are to have a full discussion, the bill should be recommitted,, and the question fully debated in committee, where we can determine whether we shall be stultifying ourselves by following the course proposed. I have received letters from persons vitally interested in the question now before the Senate. My sympathies have always been with the under-dog, whether he is in the Service or anywhere else. I trust the Government will not oppose the recommittal of the bill, because, if the motion is agreed to, we will then be able to consider the pros and cons, and come to a decision. If we find that we will be stultifying a previous action by inserting a clause in the form proposed, it will be for the committee to decide, after consideration of the amendment which Senator Grant proposes io submit, what course should be adopted.
– It seems most undesirable thai; there should be any overlapping in this matter. The question of whether the Minister or Senator Grant is right is immaterial, as the present position must be altered. The Public Service Board did not display much business acumen, because in reclassifying these officers it should have accepted the award rate as a basis instead of attempting to reduce it. I am a believer in Arbitration Court awards. As a representative of the employers, I have had a good deal to do with them. We put up as good a fight as we can in support of what we believe to be a fair wage, and once the decision of the court has been given, I always think that, whether it be in our favour or not, we should abide by it. Whatever action we take this afternoon should be on a proper basis, and the likelihood of two authorities clashing “ should be avoided. ‘ Senator GREENE (New South Wales) [4.5]. - To enable us to clarify our minds in regard to this matter, I would suggest that the Minister agree to the recommittal of the bill, to enable honorable senators to discuss the proposal with greater freedom.
– I do not intend to oppose the recommittal of the bill, but I am not going to agree with what is proposed. . Senator GREENE. - I do not pledge myself to support any amendment which Senator Grant may submit, but it seems that an extraordinary position has arisen, and,. I think, contrary to the intention of Parliament. In my wildest dreams I never contemplated that the establishment of a Public Service Board would enable that body to set aside an award already granted to members- of the Service. I cannot understand, what the Minister meant when he said that, in the event of an award being, given, the Government are bound to abide by the determination of the Public Service Arbitrator, seeing that power is given now for another government body established under statute to set aside such an award, which I. understand has been done by the reclassification. On examination it may be found that it is not possible for the- board toset aside the award of. the. arbitrator, but to have the two bodies side by side with a chain of first classification, then appeal, and then possibly another classification followed by another appeal, would be to- reduce the whole position to an absurdity. Therefore, I am pleased that the Minister is prepared to have the bill recommitted, so that the point may be threshed out in committee.
.- It is well that the Government should know the views of the Senate. When the Arbitration (Public Service) Act was passed t we were all under the impression that when the arbitrator to be appointed under the provisions of that measure would give his decisions, they would be final and binding upon Parliament. Subsequently we passed an act to establish a board to control the Public Service. I have not the slightest desire to interfere with that board’s powers of classification, but I think that it was not the intention of the Senate that the board should have the .power to over-ride an award given by the Public Service Arbitrator. It was intended, I think, that in any classification the awards of. the arbitrator should be taken into consideration. It is my opinion that the board by interfering with one of the arbitrator’s awards has now gone beyond what Parliament intended, and I think it is time the board’s position was clearly defined.. When a claim is submitted to the arbitrator,, the employees present their evidence, and the representatives of the Government submit their case. The whole matter is threshed out as in the Federal Arbitration Court before the parties to the case, and the arbitrator gives his decision on the evidence as. submitted to him by both sides. Why then should the Public Service Board, representing the employers, be permitted to upset the award of an arbitration court by issuing a fresh classification altering the wages payable to the men whose case has already been determined by an arbitrator ? No employers’ association meets with a view to upset an award after itsagents have appeared before the Federal Arbitration Court. Employers are expected1 to obey any award given, and to wait a certain time before again applying to the court. In the case of the Public Service, however, without any fresh application to the arbitrator, the board has brought out a new classification without regard to the evidence the employees have already successfully submitted to the arbitrator. It was not the intention of the Senate that, two bodies should be constituted to clash in this way, and if the present position. is .allowed to continue there will be no end of trouble. Therefore, I trust the Government will give further .consideration to the powers allotted to the Public Service Board and the Public Service Arbitrator, so that in future there will be no such clashing, and no waste of time and money through the employees having to return to the arbitrator whose award has been upset to re-submit to him the evidence they have already put before him.. I trust that the powers of the Public Service Board and the Public Service Arbitrator will be clearly defined, and that the time of Parliament will not be wasted in having to hear, appeals by the Public Service. When the Public Service Act and the Arbitration (Public Service) Act were passed, public servants no longer had a right to come to this superior court to ask members of the Commonwealth Parliament to decide their claims. People outside the Service are expected to abide by the decisions of the Federal Arbitration Court, but apparently public servants have the right of access to Parliament to ask us to upset the decisions of statutory bodies. While I recognize that it is the duty of Parliament to remedy any injustice, I regard it as an anomaly ‘“‘that the Public Service should have the advantage over the rest of the community of having the right of appeal to the supreme court of Parliament to adjust its grievances. It was to avoid that sort of thing that I welcomed the appointment of a board to control the service independently of Parliament. With our eyes open, we gave that board certain functions to perform, and we should expect it to do its work without the time of Parliament having to be wasted in reviewing that work.
– Not long ago my honorable friends opposite were very indignant because the members of a certain union would not work under an award given by the Arbitration Court. The men knew that in giving that award, the president of the Court, as he admitted, had made a mistake, yet they were condemned on all sides. My friends opposite hounded them down and called them all sorts of hard names. The press throughout Australia urged that they should be gaoled for their refusal to: work. All. they did was to refuse to sign on. They did not leave their work, and, therefore, there was no strike. To-day we have a Public Service Board refusing to obey an award of a court duly constituted by an act of this Parliament, yet no one is asking that the members of that board be gaoled. According to the law of averages, these officers who have been classified at reduced salaries should- be given an increase. When their claim was fairly fought out before the arbitrator, the index figure of the cost of living for the twelve months ending June, 1923, was 1642. The figure for the twelve months ending March, 1924, was 1720. Thus, the officers should be given an increase, and should not have their wages reduced. When these officers went before the Public Service Arbitrator, they were termed “ letter sorters,” but the Public Service Board j which is defying Parliament and the award of a properly constituted tribunal, calls them “mail officers.” The classification provides for rates of pay from £240 to £276 a year obtainable by annual increments of £6, with a qualifying test for advancement beyond £252. The present rates of pay as fixed by the Public Service Arbitrator run from £238 to £286, the maximum being obtainable by annual increments of £8. It will thus be seen that these officers will be subjected to a reduction of £10 on. the maximum salary, while the yearly increment will be reduced. At the same time, an extra efficiency test is placed on those who desire to go beyond the £252 mark. A high and mighty board has overridden the award of the arbitrator by a classification against which the men dare not say a word. I know that there are officers in the Public Service who have absolutely refused to become permanent, because of the restrictions imposed by the act. The proposed reduction will make it impossible foremen to carry out their duties to their wives and families. Therefore, it would be wrong on the part of the Senate if it did not take the opportunity to insert something in this bill to prevent an autocratic Public Service Board from interfering with au award of an arbitrator based on the cost of living.
.- I would not have spoken had it not been for the remarks of Senator McDougall. The general tone of the debate prior to his speech was that there was something technically wrong with the powers given to the Public Service Arbitrator and the
Public Service Board. No honorable senator opposite intended to make use of the debate to launch a personal attack upon the members of the Public Service Board. If the board has apparently flouted an award of the arbitrator, the blame must rest, not upon the board, but upon the Parliament that gave it the power to do this. Section 5 of the Public Service Act says: -
If the Governor-General approves of the classification, a notification of such approval, together with a statement of any alterations made’ in the classification upon appeal, shall be published in the Gazette
Section 6 says: -
Notwithstanding any determination made under the Arbitration (Public Service) Act 1020, upon the publication in the Gazette of the notification of the approval of the Governor-General of the classification (in this sub-section referred to as “ the approved classification “), the classifications and salaries of the offices, and of the officers assigned thereto dealt with in the approved classification shall, subject to this Act, be those respectively allotted to those offices and officers by the classification:
Provided that nothing in this sub-section shall be deemed to affect the operation of any determination made by the Arbitrator of a claim relating to the salaries allotted by the approved classification.
Thus, Parliament deliberately gave the Public Service Board the power to override an award made by the arbitrator.
– But there is a further appeal to the arbitrator.
– That is the position I am coming to. When the Arbitration (Public Service) Act was passed, there was a tremendous congestion in the Federal Arbitration Court. Of 50 cases awaiting hearing, 40 were claims put forward by Commonwealth Public Service organizations. Outside organizations desirous of having their claims heard were complaining of the long delays occasioned by the congestion. It was pointed out when the bill to appoint a Public Service Arbitrator was introduced that a tremendous amount of the congestion in the Federal Arbitration Court would be relieved when the Public Service cases were removed from the Federal Arbitration Court. But every one understood that the public servants were not to lose any of the benefits they enjoyed when they had the right to have their claims heard before that Court. If I had had the least idea that the appointment of the Public Service Arbitrator would limit the rights and privileges of public servants, I should not have supported the withdrawal of their right of access to the Conciliation and Arbitration Court. Members of the Public Service can now go to the Public Service Arbitrator, and obtain an award; but the Public Service Board is not compelled to abide by it. If employees exercised their right to refer their case again to the arbitrator, it is not likely that, having already heard the evidence on both sides, the arbitrator would alter his decision.
– Why should they have to go twice to the arbitrator ?
– They should not.
– If they went again to the arbitrator, they might be awarded more.
– Assume that an increase in salary was awarded by the arbitrator. If the board still disagreed, there would be no finality. I regret that Senator McDougall made a somewhat personal attack on the members of the Public Service Board. I believe that the desire of every honorable senator is to deal with the matter from a non-party point of view, and remedy the defect in the legislation. When the board was appointed, its many duties were laid down, and the tasks imposed upon it made it necessary for it to use the pruning knife in certain cases. It appears to - me that the board is now endeavouring to carry out the provisions of the act under which it was constituted. If that act is at fault it is the duty of Parliament to put it right.
Amendment agreed to.
In committee (Recommittal) :
– I move -
That the following new clause be inserted to follow clause 7 : “7a Notwithstanding anything contained in the Commonwealth Public Service Act 1922, section 27, the awards made by the Public Service Arbitrator shall be observed by the Public Service Board of Commissioners, and such awards, when approved by Parliament, shall take effect from the date on which they were agreed to by the Arbitrator.”
Awards by the arbitrator are arrived at after evidence has been given by the employees, and after the Government has presented its side of the case. When any other authority, by a new classification, or in any other way, endeavours to set aside the decision of the arbitrator, it must have a very damaging effect upon the Service. Owing to the increasing cost of living and the difficulties confronting the employees, there is a great deal of discontent in the Postmaster-General’s department. I suppose no branch of the Service comes more into contact with the general public than does this department, and probably the letter-carrying section of it is more closely in touch with the people than any other. I think that there is considerablejustification for the discontent that has existed for some time. In November last year, as a result of the expenditure of a good deal of time and money, the postal sorters secured an award, but as Parliament was not in session, the award remained a dead letter until some time after Parliament had assembled. Now these employees are confronted with a further difficulty. The Public Service Board, under its scheme of reclassification, has decided to vary the award of the arbitrator. Seeing that the cost of living has increased since the award was made, there should be an increase, and not a reduction, in the salaries of the employees. There is no reason why the award arrived at by the arbitrator, after hearing evidence from both sides, should not be observed. I admit that, on some occasions, organized industrial unions have reluctantly observed the awards of the Arbitration Court, but, on the whole, the Labour movement in the Commonwealth stands for arbitration. It is true that a limited number of men, quite honest in their opinions, are entirely opposed to arbitration, and want something more sudden and drastic. But, generally speaking, the Labour unions desire industrial peace, and are agreeable to having their wages and conditions of employment determined by arbitration. In private employment, the alteration of an award, as is now proposed, would not be tolerated. The Public Service Board may think that they have done the right thing, but,to my mind, their action is subversive of the best interests, not only of the Public Service, but of the Commonwealth generally. It was never contemplated by those who took an interest in the establishment of federation, and particularly in the constitution of the Senate, that this Chamber would develop into a replica of the other branch of the legislature. The idea was that the Senate should represent the states. Honorable senators can discuss matters of this kind on a very much higher plane than can honorable members of another place. The other house is essentially a party house. Every honorable senator can view this matter in a strictly non-party light. He can visualize the conditions under which employees in the Postal Department work, and he, must realize that those employees have been unfairly treated. The opportunity is now present to rectify what I believe is a wrong. The amendment sets out that any award made by the Public Service Arbitrator must be observed by the Public Service Board of Commissioners, and that the commissioners shall not be permitted to set aside such an award. A proper method is provided for setting aside an award, and that is by lodging an appeal with the court. The securing of an award to-day is a very costly business; and takes a long time. These employees are not financially in a position to incur that expense. I confidently believe that the second part of the amendment, which proposes to make the award, when approved by Parliament, retrospective to the date on which it was agreed to by the arbitrator, will have the approval of the committee. I have moved it, believing that it is in the best interests of the Commonwealth and of the employees in the Postal Department.
-(Senator Newland). - I suggest to the honorable senator that the proposed new clause be worded as follows : -
Clause 7 (a) Notwithstanding anything contained in section 27 of the principal act, the awards made by the Public Service Arbitrator shall be observed by the Board.
The honorable senator should not insist upon moving the latter portion of the amendment, which reads - and such awards, when approved by Parliament, shall take effect from the date on which they were agreed to by the Arbitrator - because that would necessitate an amendment Of the Arbitration (Public Service) Act.
– I agree to the new clause being put to the committee in the amended form suggested by the Chairman.
Amendment, by leave, amended accordingly.
– Whilst I have every sympathy with the objects sought to be achieved by Senator Grant, and whilst I agree that it is most unfortunate that in the first portion of the classification which has been ‘ gazetted by the Public Service Board the salaries allotted to the offices held by some public servants are lower than the existing rates, it seems to me that Parliament itself is responsible for what has been done, and that Parliament has already provided a means for dealing with it. Senator Grant, 1 think, will find that his proposed new clause is a contradiction of section 27 of the principal act, which reads -
As soon as may be after the commencement of this ‘act, the board shall classify officers, other than officers of the first division, within the divisions specified in section 23 of this act, in accordance with the importance and character of the work performed, and the classification of each office, the officer assigned to the office, and the salary of the officer, shall be notified in the Gazette. The classification of the Commonwealth Service may be gazetted wholly or in sections, as the board deems expedient. ,
That section deals with the whole matter of classification. It contains a number of sub-sections, one of which sets out that a,n individual officer who is dissatisfied with his classification shall have the right to appeal to the board in respect to that classification, and it also states the manner in which such an appeal shall be made. Sub-section 6 reads -
Notwithstanding any determination made under the Arbitration (Public Service) Act 1920, upon the publication in the Gazette of the notification of the approval of the GovernorGeneral of the classification (in this sub-section referred to as “ the approved classification “), the classifications and salaries of the offices and of the officers assigned thereto dealt with in the approved classification shall, subject to this act, be those respectively allotted to those offices and officers by the classification.
Parliament, in passing that sub-section, deliberately indicated that the classification should set aside, if necessary, the existing awards of the Public Service Arbitrator. Sub-section 6 has the following proviso : -
Provided that nothing in this sub-section shall be deemed to affect th3 operation of any determination made by the Arbitrator of a claim relating to the salaries allotted by the approved classification.
That proviso means that after the making of the classification - which may or may not, according to the judgment of the members of the Public Service Board, set aside determinations of the Public Service Arbitrator - the Public Service has the right, in respect of salaries only, to go back to the Public Service Arbitrator and claim from him a re-adjustment of salaries. That has been deliberately done by Parliament, apparently with the desire to obtain, by the classification, uniformity, which, may or may not have been interfered with by the awards of the Public Service Arbitrator, and to reestablish the right of the Public Service to have their salaries re-adjusted by the Public Service Arbitrator. That is what has happened. In practice it can happen only once.
– Does the honorable senator contend that, after the Public Service Arbitrator has determined a claim relating to salaries fixed by the classification, the Public Service Board cannot reclassify next year?
– That is the law, as I read it. The act is very clear and definite. It says -
As soon as may be after the commencement of this act the board may classify the offices. That is what it has done. I have not’ had time to go right through the act to” see if the board can classify the service over and over again, but I do not think that it can. The Minister, no doubt, will be able to give honorable senators more detailed information than is in my possession.
– There is only one classification of the service, but individual positions may be subsequently classified.
– That is what I thought was the position. It is perfectly clear that the board can move individuals from one classification to another. It can make new positions, and can take an individual from one class and put him in another class. An officer would not desire to remain in class V.« for the whole of his life if he could get a position in’ Class I. The board, however, cannot lay down a complete classification for the Public Service on more than one occasion. The classification that has been made has set aside the determination of the Public Service Arbitrator. The power to do that was deliberately given by this Parliament to the Public Service Board.
– Does the honorable senator think that Parliament deliberately gave the Public Service Board the right to reduce the salaries of public servants ?
– Yes. I pointed that out in this chamber at the time.
– I tell Senator Gardiner quite frankly that when the act was before another place in 1922, I did not realize the extent to which it might affect the individual salaries of members of the Public Service. The probability is that it was thought at the time that the proviso to sub -section 6 of section 27 would safeguard public servants, because that proviso laid it down that the final determination of the Public Service Arbitrator in relation to salaries -under the classification should prevail.
– It will, therefore, ‘be necessary for the Public Service organizations to again approach the Public Service Arbitrator. . Senator GREENE.- Unfortunately, it will be necessary for any organization, the members of which are dissatisfied with the salaries that have been allotted to the offices they hold, to approach t’ie Public Service Arbitrator and obtain from him a further determination; but having done that, the determination of the Public Service Arbitrator will prevail over the salaries that have been fixed by the Public Service Board under the classification. The board cannot make a reclassification.
– Under a new bill it could.
– If Parliament decided to set aside- the present law and bring in a new act that could be done; but as the law stands the position is as I have stated. The classification has. been made. Parliament gave to the board the right to set aside the existing award of the Public Service Arbitrator, and it has also given to public servants the right to again approach the Public Service Arbitrator^ whose award shall prevail.
– I hope the committee will vote for the amendment. It is a plain, understandable proposal. Those of us who have followed the bill since its introduction are cognizant of the provisions in the act, and particularly that section referred to by Senator Greene. We know the powers given to the Public Service Board under section 27. We are also aware that there is a Public Service Arbitrator to whom dissatisfied public servants may appeal from time to time. Let us strip this question of all its- legal technicalities, and look at it from the point of view of- the man in the street. There are in the Public- Service thousand’s of employees who are permitted to band themselves into organizations if they so wish, and if they are dissatisfied with their conditions or rates of pay they may appeal to the Public Service Arbitrator. In November last a number of employees in- the Postal Department did so appeal, and after the Arbitrator had made his award, which has been observed for a short time, the board, being dissatisfied, apparently set about a reclassification of the Service; and by this means disregarded the award. The Minister says that dissatisfied public servants may appeal again to the Arbitrator, notwithstanding that some of them may have been before the Arbitrator’ but a few months- ago-, and tender the same evidence in support of their claim. We all know that the cost of living has; increased, and that, the difficulties of members in the Public Service have been multiplied as- a result partly of administrative actions. Irrespective of where we sit in. this chamber, we all ought to wish for finality in our legislation. There is no finality about this bill. Would any honorable senator supporting the- Government conduct, his business in the same manner as it is proposed to administer the Public Service under this bill? Why was the Public Service Arbitrator appointed 1 According to the. statements in the. press at. the time, our. Arbitration Courts were, so crowded that it was impossible for large sections of dissatisfied employees, in the Public Service to get a hearing. This tribunal was. created in order to ease the position. Suppose public servants had. gone to the Arbitration Court, as distinct from the Public Service Arbitrator, and the court had made an award. Would honorable senators then stand by the Public Service Board if that body said, “ Court or no court, we are going to disregard the award made % “ If that stand were taken in such circumstances, there would be such a hue and cry from one end of Australia to another that any honorable senator who supported a Government that countenanced such a policy would not have his chances of re-election enhanced when next he met his constituents’.
– Under, the act the board may, by a classification, absolutely evade an award.
– And I want tho committee to say that in future that shall not be possible. Senator Grant’s amendment is quite clear. It provides that notwithstanding anything contained in the act the board shall observe the awards made by the Arbitrator. ‘ There is nothing in it to which honorable senators can take exception. I like the tone of the speeches made from the ranks of Government supporters on this question. I was particularly pleased to hear Senator Thompson say that the Public Service Board should take the rates fixed by the Arbitrator as a commencing point.
– That can yet be done.
– If honorable senators will vote for the amendment it will be. This is not the time to cut down wages. If we want a contented Service, and to get, the best results from Government employees, they must receive a wage that will enable them at least to live in decency and comfort. Does any honorable senator think that the rate fixed under the present classification scheme for mail officers is a living wage for married men with families ? It is not, in my opinion, and the committee should not stand for a wage that is more or less a sweating wage.
– It, is somewhat better than the old rate, for men in the lower grades.
– There are some members of the Public Service on a lower classification than that, and we all know that the purchasing power of £A or £5 a week to-day is, approximately, only about half what it ‘was in pre-war days. I trust that the committee will, by voting for the amendment, insist on justice being done to those to whom, apparently, justice is to be denied by the Public Service Board. Although the amendment may appear to be in conflict with section 27 of the act, we should not be concerned about that. If we carry the amendment it will be for the Government to see that the necessary alterations are made in the other provisions of the act. We are concerned only with the business before us to-day. By voting for the amendment we can improve the bill, and at the same time do justice to members of the Public Service.
– I hope the committee will not accept the amendment. I associate myself with what Senator Greene has said. In fact, I thought I had told the committee that if. the amendment were carried Parliament would stultify itself. The act provides that the Public Service Board may make a classification of the Public Service, and also that public servants aggrieved with the classification may appeal to the arbitrator. I doubt very much that this clause, if carried, would have any effect, because there would then be two contradictory provisions in the act, one authorizing the board to make a classification, and another, inserted later, stating that notwithstanding anything contained in the act, the award of the Public Service Arbitrator shall stand.
– It may so happen that a classification, subsequent to an award, may absolutely destroy the award.
– There can be only one classification. Section 27 (1) of the act provides that, as soon as may be after the commencement of the act, the board shall classify officers other than officers of the first division. When the board has classified the Public Service, there cannot be another classification.
– The object of the amendment is to ensure that, under the classification, rates of pay shall not be below those fixed by an award of the Public Service Arbitrator.
– But the classification in point has been made. It has been gazetted, and is in force.
– There may be future classifications.
– That is a legal question. The section gives power to the board to classify the Service, and there is a saving clause in regard to arbitration. I again appeal to the committee not to stultify itself by . inserting two contradictory provisions in the principal act. Honorable senators either did not know what they were doing when they passed this provision in the original bill, or they do not know what they are doing now. The Government cannot accept the amendment, and I ask the committee not to support it.
.- When the Minister (Senator Pearce) quoted a clause to show that there should be a classification after the passing of the act, and made it appear that there could be no further reclassification, I did not know what he meant. I think the board can conduct a further reclassification. A portion of the Service has been classified. Senator Greene said that we had given the board power to do what it has done, but Parliament never gave it the power to alter an award of the arbitrator. I imagined that competent men would be appointed members of the Public Service Board, and that they would not within three months of their appointment deliberately upset a decision of the arbitrator. If action was deliberately taken in that direction the members of the board arc not fit to fill the positions which they occupy. “When the act was passed it was believed that it would be administered in a common-sense way, but if it is not to be so administered, it should be amended. I do not wish to call for a division, because I do not wish the loyal supporters of the Government to be compelled to vote in order to rectify what is shown to be a wrongful act on the part of the Public Service Board. The act under which the board was appointed only came into operation a little while ago, and before June we were confronted with a classification which altered an award of the Public Service Arbitrator. What will be the position if we carry the amendment? “We are not interfering with the reclassification. The board can classify as it wishes. “We are not interfering with the salaries or wages paid, but simply providing that the board’s classification shall be in accordance with the conditions laid down by the arbitrator. “We should make it unmistakably clear to the board that, so far as Parliament is concerned, there shall be no reduction in wages or salaries as a result of reclassification. It may be unfortunate if reclassification increases the salaries of certain officers in higher positions. The Prime Minister, in reply to a question in another place, said that the Service ought to be satisfied, because the expenditure in consequence of the reclassification had increased; but somE of the men affected in a particular division claim that they, will be losing £19 per annum, which is a serious reduction. If the proposed new clause is adopted, it will merely state in plain and defi nite language that the power of the board to go beyond an award as a result of reclassification is withdrawn.
– We should provide that any existing award must be the minimum.
– Exactly. I suppose there is provision in the act giving the Public Service Board the right to appeal against an award. If the public servants have to go to the arbitrator, tho Public Service Board should have to approach the arbitrator in the matter of reductions.
– It does.
– In this case it did not. We want a simple statement in a straightforward way. The present position could not easily have been foreseen. If an honorable senator had pro-, posed an amendment in the original bill to meet a position such as that which has now arisen, the Minister in charge would have ‘ said, “ Can any one imagine the board, within three months of its appointment, endeavouring to reduce an award?” The board has made a reclassification which concerns hundreds of men, chiefly in our cities, under which an increase granted in November, which was not available until April because Parliament was not sitting, is now to be withdrawn.
– The officers concerned have the right to go to the arbitrator who granted the award, and will they not do so?
– The opinion of the Senate is, I believe, that the salary rates should be maintained. That is what the new clause provides, and the Minister should accept it without a division. It is unfair to ask the supporters of the Government to go before their constituents and admit that they voted for a reduction in wages. The new clause submitted by Senator Grant provides, in effect, that the Public Service Board shall not make a reduction in the wages of the lower-paid member’s of the Service. We do not wish to interfere with the powers of the Public Service Board, but, as a Parliament, we desire to define more clearly what its powers are, in view of experience gained through the exercise of its authority. If the members of the board are competent men, they will regard the insertion of this clause as a clear indication of the intentions of Parliament; but if- it is rejected; they will feel that Parliament supports their action. For the sake of as few thousand pounds, general dissatisfaction in the Service will prevail, and men upon whom we depend for good service will be discontented. From the circulars I have seen in. the possession of honorable senators, it would appear that there is perhaps the most widespread activity in the Public Service- that I have known of during my parliamentary career. A. halfdozen men came to my house the other day and submitted their grievances, but I did not consent to move in the matter until I ascertained the exact position. Senator Findley received a communication from the Victorian branch, but no arrangement was mad’e on this side for any organized opposition. If, now that the bill has been recommitted, no alteration is made, the outlook, both for those who oppose the proposed new clause, and the Public Service generally, will be very Unsatisfactory.
– There seems to be a little misunderstanding in regard to the position. Senator Gardiner has stated that he’ did not understand what was meant by the amendment contained in clause 27 of the original bill when it was before the Senate. “ S’enator GARDINER - That is not what I’ said.’
– The honorable senator said that he would not have supported the alteration if he had understood it.
– Not if it meant a reduction in wages.
– I am. quite sure the honorable senator did not understand me- when- I pointed out the- position when the bill was under discussion in- this chamber. I said that the effect of clause 27 was that when a classification had been made by the board appointed under the act it automatically wiped out every arbitration award affecting wages of public servants as from the date of the classification.
– Did the honorable senator ever hear of greater madness?
– It may be undesirable, but the fact remains that I clearly indicated to honorable senators what it- meant, and in spite of my urging that it was ridiculous1 it- was agreed to. It. is useless, for honorable senators to say that they’ did not understand the position, as they had an excellent opportunity of realizing what would be: the effect when the measure, became law. Under- the powers conferred upon the Public Service Board it has: effected a partial reclassification which has been gazetted and- has become- law. That is the position of those people on whose behalf complaints have been made, and their rights in regard to arbitration awards which existed, say,, yesterday have gone. The amendment submitted by Senator Grant will not restore them.
– It will. Will the Public Service Board continue reclassifying ?
– The amendment,, if adopted, will not. restore the salaries of those already dealt with. -
– Then why did the. honorable senator support the recommits! of the bill ?
– I have since had an opportunity of ascertaining the exact position. Parliament was’ not quite so unwise- as- the Leader of the.- Opposition- thinks,, and the honorable senator was not quite< so foolish as he imagined. When, the original bill was going through, a proviso to clause 27 was inserted to the effect that any reduction under the reclassification could not hebrought about for a period of twelve months after the reclassification. The letter carriers and others referred to today, who,, under the reclassification, havehad their wages reduced to the extent mentioned, will not be affected, as regard’s salary, until twelve months have elapsed’ from the date on which the classification was gazetted. Within that period they have the opportunity and right to go to the Public Service Arbitrator for the purpose of getting an award; they are amply protected. In fact, if the Public Service- Arbitrator- thinks that they are entitled to additional wages, and I have no doubt he will re-affirm his previous award, they will receive the wages they were getting prior to the reclassification. We- wipe out all the- existing awards affecting public servants who have been- classified and start off de novo. Any portion of the service- reclassified’ has the’ right to go to. the arbitrator for’ an award. This matter has beenworrying some honorable senators who think that when the public servants obtain a new award from the arbitrator, the Public Service Board will issue a new classification, but under the Public Service Act that cannot be done. The board can make a classification, but the Leaderof the Opposition fears that they may have tine power to make a further classification. As a lawyer I wish to assure him that it cannot.
– But an amending bill could be introduced.
Parliament exercises its power there is nothing within the constitution it cannot do.
SenatorGARDINER. - Under what clause is a further reclassification prevented.
– BROCKMAN.- Clause 27 specifically provides that the board may make a reclassification. The board was given power to make a classification, but that did not mean that it had the power to make a further classification.
SenatorGardiner. - What is the honorable senator’s authority for saying that.
– The matter is governed by the doctrine of expressio unius exclusio altering. The board may make one classification, and one only, and having made that, it is prevented from making another, and once a classification is made the associations may go to the Public Service Arbitrator and secure awards with which the board cannot interfere.
– The honorable senator has not quoted anything from the act to show that the board will be prevented from making a further classification.
– The board will have no authority to do so.
– The whole personnel of the Service may change in five years, and necessitate reclassification.
– In such circumstances it may be necessary for Parliament five years hence to give power to some one to reclassify the Service ;but as the act now stands the board can classify once only.
– What provision of the act says so ?
– Sec tion 27.
– Section 27 merely provided that there was to be a classification after the passing of the act.
-‘ ‘ A classification “ means one classification only.. It is useless for the honorable senator to try to convince me to the contrary.
-It is useless for the honorable senator to tell me that the act contains something which is not in it.
– I am doing nothing of the sort.
SenatorPearce. - The interpretation placed upon the act by Senator DrakeBrockman is the accepted view of the PublicService Board.
– No doubt the board has had the benefitof’ legal advice. I am trying to let my friend opposite have the benefit of my specialized training in the interpretation of statutes. If he has any doubt about my opinion let him consult the officer of the Crown Law Department who is in attendance. I have not the slightestdoubt he will tell him that what I have stated is correct in every particular.I am assured by an officer of the Public Service Board, who is in attendance, that I am correct when I say that if an officer’s salary is reduced upon classification the reduction willnottake effect for twelve months.
SenatorKINGSMILL (Western Aus tralia) [5.27]. - It is an old saying, but none the less worthy of belief, that “ the evil that men do livesafter them.” Apparently the evil done two years ago is resuscitating itself with a vengeance, and has given rise to what has almost degenerated into what might be called an acrimonious debate. Senator Pearce has implored us not to stultify ourselves. Does it not occur to him that the stultification occurred two years ago, and that those of us who believe in this amendment are endeavouring to repair the error then made. If, when the original bill wasunder consideration, Senator DrakeBrockman pointed out to the Senate what the effect of clause 27 would be, I cannot imagine how honorable senators would consent to such a waste of time, trouble and expense as to set aside awards which were, I take it, fair awards - awards that had been the subject of earnest con sideration, and had involved considerable expenditure - and; start as it were de novo on the completion of this classification. Gradually, as the debate goes on, more and more new points are creeping into it. I thought for a moment that the classification was finished. It appears mow that it is not yet finished. It would <be very interesting to learn to what extent it is finished. As Senator Drake-Brockman has said, apparently those people who have already been classified are without the right of appeal, and even with the help of this amendment they will have to go through the ordinary course of asking the Public Service Arbitrator, who has already given an award in the first place, to make a fresh award. I acquit the Government of any criminal intent, but the foolishness of this is very apparent. I shall vote for. the amendment, because I wish the intention of Parliament to be made evident in relation to those officers who have not yet been classified. There is still a fair proportion of the Public Service whose classification has not yet taken place, and I do not want those men* to be forced again to the risk of having new .awards made for them. I do not want the Government to be put to the expense and waste of time involved in the making of these awards. I think that Parliament did a very foolish thing two years ago when it expressly stated, as it apparently did, that all awards should be wiped out by the Public Service Board’s classification. There may have been a reason for this step, but it has certainly not yet been explained. Undoubtedly, as shown in this debate, certain public servants have suffered a great deal, or are about to suffer a great deal, of personal loss, and as a new member, of the Senate I intend to do my best to repair the wrong, which, apparently, older senators have done to the Public Service.
– It is obvious that this matter is sufficiently important to warrant further consideration. I, therefore, propose to report progress.
– I move -
That tho bill be now read a second time. This is one of the most important measures that the Senate will be called upon to deal with during the present session. The statistics and information given by the Treasurer (Dr. Earle Page) in another place have been printed and circulated among honorable senators. Therefore, instead of indulging in a survey of banking in general, I shall content myself with an examination of the provisions of the bill itself. If this measure is carried, it will really give effect to what was intended by a majority of the people when the Commonwealth Bank was established. What the sponsors for the original bill intended - I was a member of the Government that introduced it - was not given effect to by it as finally passed. The bank, as constituted by that measure, had very limited scope. This bill will extend its functions. It makes it what many people believed it was designed to be - a bank of deposit, issue, * discount, exchange, and- reserve. In the original act, provision was made for the control of the bank by a governor. The present bill makes a vital change in that respect, for, whilst it provides for a governor and a deputy governor, it is also proposed to introduce a system of board management, which is the more familiar form of bank management as we know it in Australia. All the private banks here have their boards of directors as well as their general managers. This remark applies not only to the private banks carrying on business in Australia; but also to such banks as those of the United States of America, France, and South Africa, and the Bank of England. Then, too, the bill makes an important alteration in that it places the note issue under the control of the general board of the bank, thus linking up with the Commonwealth Bank the two great activities of banking, and the issue and control of notes. This alteration should do much to make the Commonwealth Bank what we desire it to be - a central bank. There could be no more appropriate time than the present for the extension of the functions of the Commonwealth Bank and for giving it the control of the note issue, since the disorganization of the world’s finance brought about by the war - a potent factor in every country - should warn us of the grave dangers of faulty management of banking or banking institutions. Of course, we know that the rate of exchange is the most pressing question in every country, and it is particularly serious to Australia at present in connexion with its oversea trade. The rate of exchange fluctuates to a surprising extent from time to time without the causes for the alteration being clearly apparent, at any rate, to the ordinary mind. This constitutes one of the most puzzling phases of banking and finance, and one of the most difficult with which to deal. Let me mention two instances of alterations in the exchange position that have occurred comparatively recently/ In 1920, money in Australia was not tight, but Australians had large commitments to meet in Great Britain. They found not merely that an excessive rate had to be paid to remit money to that country, but in many cases it was impossible to effect any remittances. There are some striking evidences of this in the possession of the Treasury. It was a most serious matter, because there were a lot of old commitments which could not be met, and doubts arose in Great Britain as to the financial soundness of many well-established and prosperous Australian businesses, with a consequent injury both to those businesses and to Australian credit. In 1922 the exchange position was entirely reversed, and for many months it has been almost impossible, except at tremendous cost, to transfer to Australia all the moneys realized by the sale of Australian produce overseas, or the ‘moneys being raised abroad for Australian development. Not only has that position come about, but money within Australia is so tight that it is hard to get advances from the banks for the most desirable purposes and on the safest securities. Even money in the hands of private persons is not available for ordinary investment to the same extent as usual. This fact, I know, is to some extent attributable to the State Governments having been forced, largely because of the exchange position, to borrow on the Australian market, for developmental works, instead of going on the London market as they would under normal conditions. Incidentally, there has been a great increase in the interest charge for Government loans, and this has had a reflex influence on the interest charged for loans for private business. A consideration of these factors forces us to realize that the important function of banking can be properly performed only with the guidance and control of a central bank. Decision and settled policy are essential. Divided counsel and clashing interests of individual bankers must, in the end, be fatal to good credit and management, and banking can be raised to perfection only by the action of a central bank working always, for the good of all. This is obvious ; so much so, that central banking is recognized by the leading nations as a necessity. I do not profess to have any special, knowledge of finance or banking, but nobody who has been in the Government as I have been during and since the war could have failed to glean from that experience some knowledge as to how finance is conducted in Australia. As Senator Greene and other honorable senators who have been members of various Ministries are aware, there have been occasions when Ministers have been called to conferences with the representatives of the various banking interests of Australia. What has always impressed me is the fact that while those representatives occupy leading positions in the financial world, and are deservedly men of high repute, there is a lack of any body of individuals in Australia that can look at the financial question from a central bank point of view, and more ‘ especially, consider the interests of the country. The best efforts of the bank representatives is mainly, and quite naturally, directed to promoting the interests of their respective banks. They look at all matters of public finance, whether war or reconstruction finance,” f rom the point of view of how they affect the interests of their particular institutions as opposed to those of the other banks, or how they affect their banks as against possibly the public interests. The establishment of a central bank will give Australia, as it has given the United States of America, South Africa, and England, a competent and educated opinion on all questions of public finance and banking that will be of the utmost value. As time goes on, and the bank gains the confidence, not merely of the public, but, what is perhaps more desirable, the confidence of all the private banks, the latter will look to the central bank for leadership and guidance in all complicated financial crises, whether of exchange or any other phase of the phenomena of finance. This will be of incalculable value to Australia. The aim and ambition of the Government is to create such a body in and through the medium of the board proposed to be appointed to control the Commonwealth Bank. I hope that what I have said will not be thought to be in any way a reflection on the banking material that we already have in Australia. I believe that that material is as good and as competent as. that to be found in any other country; but it must be admitted that no bank in Australia to-day is in the position of a central bank, and, therefore, no one of them, can crystallize and co-ordinate the banking opinion in Australia as would a truly central bank carrying- out in its entirety the functions of such an organization. In order that I may set out the alterations proposed in the bill, let me briefly refer to the history of the. Commonwealth Bank. It was established by an act passed by the Commonwealth Parliament in 1911. Generally speaking, the bank was authorized - (a) to receive money on fixed deposit or current account; (6) to make advances by way of overdraft or loan; (c) to discount bills and drafts ; and (d) to carry on the business of a savings bank - this, however, to be kept in a separate department. A provision was included, making the Commonwealth responsible for the payment of all moneys due by the bank. Another clause placed the management of the. bank in the hands of one man, who was. to be appointed for a period of seven years, and was to be entirely beyond political control, except in some routine details of no special importance: According to the original act, the capital of the bank was to be provided by the issue of debentures up to £1,000,000. By an act passed in 1914, the amount was increased to £10,000,000, but the bank has not vet issued any debentures. The act of 1914 authorized the Commonwealth Bank to purchase the business of any other bank; also to take over any state savings- bank. In both these matters the. approval of the Commonwealth Treasurer had first to be obtained. No bank has been purchased by the Commonwealth Bank. Two states have handed over their savings bank business to the Commonwealth Bank, namely, Queensland and Tasmania, the. terms including, in. each case,, a provision that the ‘.state is to have the right to borrow from -the bank 70 per cent, of the increase of deposits. Though the original act provided that half the profits of the bank might be used towards, the redemption of .Commonwealth or state public debts, no portion was devoted to that purpose, and the whole, amounting, at 30th June, 1923, to £4,403,987, has been used- in the business of the bank. Indeed, it cannot now be said that the Commonwealth Bank has no capital, because the accumulation of profits has furnished it with a sum for that purpose. “Under the National Debt Sinking Fund Act passed’ last session, one-half of the profits must be paid into the sinking fund, and the first instalment of £61,672, representing half the profits for the six months ended 31st December, 1923, has already been paid over by the bank to the National Debt Commissioners. At the time of the establishment o£ the bank, the paper currency of Australia was under the management of the Treasurer, but the experience of the. war showed the desirability of placing the issue entirely beyond political control. An act was, therefore, passed in 1920 establishing a note issue department of the Commonwealth Bank, and placing it in. the hands of the- Governor and three other directors, the Governor being given a casting vote in case of equality of voting. Although the management passed over to the Commonwealth Bank, the notes remained an obligation of the Treasurer, as before, and in case of emergency the issue may be brought back to the Treasury by the issue of a proclamation, for such period as may be specified. The profits of the note issue, under the new management, are payable into the Consolidated Revenue of the Commonwealth. The making of a profit of over £4,500,000 by an institution which was established only twelve years ago, is a notable performance, particularly when it is remembered that the bank has never had a capital, except that which was created out of its. own earnings.. On page 14 of the pamphlet containing the speech of the Treasurer (Dr. Earle Page), in moving the second reading of this bill in another place, are to be found some interesting facts, to which I invite the attention of honorable senators. ‘ While the earnings of the Commonwealth Bank constitute a. notable record, it. may be also said that the bank has had a notable opportunity to make those earnings. live main amendments are proposed in the bill, viz.: - (1) Appointment of a board of directors, to control not only the general business, but also that .of the note issue. (2) The provisions of clause 5 will result in the strengthening of the bank by the provision of further capital. (3) Under clause 10 the board will fix and publish its discount rate. (4) Clause 17 makes provision for the private banks to settle their balances through the Commonwealth Bank. (5) Clause 17 also relates to the compilation of statistics. All these amendments are intended to increase the efficiency of the ‘Commonwealth Bank and make it a central bank.
– Can the Minister say whether it is proposed to discount foreign bills?
– I cannot, offhand, say whether that is so, but I shall obtain information on the point. I take it that when a foreign bill has been discounted by another bank it can be rediscounted by the central bank. It is proposed that the bank shall be managed by a board of eight directors, consisting of the Governor of the bank and seven other persons. One-man control is inadvisable for an institution, the policy of which may affect production, employment, and prices. Here I should like to say that I think the Commonwealth was exceptionally fortunate in being able to place the destinies of the bank in the hands of such a gentleman as the late Sir Denison Miller. There, is no doubt that that gentleman did a wonderful service to the bank and to the Commonwealth. He had some critics, as every man has who renders conspicuous service, but I think that on the whole it is generally recognized that he had a wonderful record of public service, and did a great deal’ towards placing the bank in the splendid position which it occupies to-day. In constituting the board the Government recognizes that the government of a central banking institution should include everything that varied experience and mature judgment can supply. The Government, believes that the qualifications necessary for the carrying out of the extended functions, of the bank cannot be found in one man. It is proposed that there shall be two officials on the board, viz., the Governor of the bank and the Secretary to the Treasury, the last named being included in order to ensure proper liaison between the Treasury and the bank, so s to keep the hoard of directors *au with, the national financial position.
The Secretary to the Treasury is at present a director of the note issue department of the bank. I am also authorized on behalf of the Government to say that .it is intended that the Deputy Governor of the bank shall attend . meetings of the board in order that he may keep himself in touch with what it is .doing. He will not be a member of the board and will not exercise any of the functions of its members. It will readily be realized, however, that the Governor of the bank, may, at times, be seized by illness, and the Deputy Governor may suddenly be called upon to exercise his functions. It is desirable-, therefore, that the Deputy Governor should be in close touch with the board, so that he will be acquainted with its policy and the methods that are being adopted by it. Thus, if he is called upon at -any time to perform the duties of the Governor, he will not be new to the board and the board will not be new to him.
– Can the Minister say whether the oath of fidelity and secrecy which the Secretary to the Treasury will have to take will prevent him from communicating to the Treasurer matters relating to the business of the bank?
– As I have said, He will be the liaison officer between the board and the Treasurer. If he were sworn to secrecy as against the Treasurer he would hardly carry out those functions. Therefore, I think that the honorable senator’s question can safely be answered generally in the negative, except as tq details of the business of private indi’7 viduals. ‘,’
– I presume that the Treasurer also will be sworn to secrecy.
– Senator J. B. Hayes, as an ex-Minister of the Crown knows that the Treasurer, in common with other Ministers, is sworn to secrecy. It must be remembered that the Commonwealth Treasury handles a very large business, controlling in its receipts and expenditure -upwards -of £120,000,000 per annum, and it is necessary to co-ordinate the work of the Treasury with -that of the bank. Already we have had experience showing the extent to which the resources of the Treasury can be made available for the ‘Support of banking operations generally, and there can be no doubt that the linking up of. the operations of the Treasury with those of the bank will strengthen the system of central banking. There is precedent for this proposal, because the Secretary to the Treasury in the United States is the Chairman of the Federal Reserve Board, which governs the whole of the central banking system. The Comptroller of the Currency (a Treasury officer) is also a member of the Federal Reserve Board of the United States. It may be stated, too, that of the directors of the Bank of France, three must be officials of the Government Treasury Department. In considering the qualifications required in the six other directors, the Government has been, impressed by the fact that in the two most recently created central banking systems, those of the United States of America and of South Africa, particular care was taken to have commerce, agriculture, and industry represented on the governing boards. It has been decided that four of the directors of the Commonwealth Bank shall be persons who are or have been associated with manufacture, agriculture, pastoral pursuits, other primary industries, or commerce. The intention is that these four directors shall have special and intimate knowledge of those businesses or industries, as well as a knowledge of finance. In order that the requirements of every part of the Commonwealth shall be kept in view in the management of the bank, a clause has been inserted in the bill requiring that fair representation of the geographical divisions of the Commonwealth shall, as far as possible, be arranged in the making of appointments to the board of directors. A similar provision exists in the Federal Reserve banking law of the United States of America. The remaining two directors are to be appointed because of their knowledge of currency matters. Tim is necessary, because the appointment of the present directors of the note issue department of the Commonwealth Bank are terminated by the bill, and the control of that department will pass to the general board. The importance of determining the exact amount of paper currency is so very great, and the complexities are so formidable in relation to the effect upon the community, that the Government believes it is absolutely necessary to place currency experience upon the general board of the bank. For the same reason the board, although permitted to decide all other questions by a majority of votes, will not be allowed to determine questions relating to the note issue unless the determining majority includes two of the following, namely: - The Governor of the bank, the Secretary to the Treasury, and the two directors appointed because of their knowledge of currency. I wish to qualify that by saying that since my notes were prepared the Government has come to the conclusion that the same result can be achieved in another way, and I shall at a later stage indicate an amendment that I shall propose to that particular provision. Here, again, there is a valuable precedent, because the management of the Bank of France in-, eludes three censors, whose unanimous approval is required in connexion with any decision relating to the issue of the notes of the bank. It is proposed that the chairman of the new board shall be elected by the directors themselves. It is thought that the Governor of the bank should not be the chairman of the board, because he will be the chief executive officer of the board. In that matter we are following the example of private banks, because the general manager of a private bank is not the chairman of its board.
– The bill does not provide that the Governor of the bank shall not be the chairman of the board.
– I think that it does.
– I do not think the bill prevents him from being elected by the board to the position of chairman of the board.
– It is intended that he shall not be the chairman of the board. In conferences which Ministers have had with the general managers of the private banks, there has been found an astonishing unanimity of opinion that the chief executive officer should not be the chairman of the board. The official view will at all times be thoroughly well expressed at board meetings by reason of the fact that the Governor of the bank will be one of the directors on the board. As I have already stated, the geographical divisions of the Commonwealth will be kept in view in the making of appointments to the board of directors; but, in order to enable the board to be supplied with full information of a local character, the Government proposes that there shall be a board of advice in such principal cities of the Commonwealth as may be specified by the Governor-General, by notice published in the Gazette. The number of members of the boards of advice will not be more than three, and, as far as practicable, directors of the bank will act also on boards of advice. Each board of advice will be required to submit to the board of directors, at least once a month, a report in writing concerning the affairs of the bank in the district in which the board of advice exercises its powers. A director or officer of any corporation other than the Commonwealth” Bank, carrying on business which is wholly or mainly that of banking, will not be eligible for appointment as a director or a member of the boards of advice. The board may appoint from among its members an executive committee of not less than three directors to carry on the business of the bank between the meetings of the board. The merging, by repeal of section 60d by clause 14, of the management of the note issue with that of the general management should be of great advantage to the banks and the business community, because there can be no doubt that the power of issuing notes is a most valuable banking reserve. I think our experience in the war demonstrated that fact. The new board will have the power, just as the present Notes Issue Board has, of issuing notes, both in case of emergency and for ordinary business expansion. Critics of the Notes Issue Board have held that it did not function as it should. The Government has perfect confidence in the present personnel of that board, but recognizes that its powers were scarcely wide enough to enable it properly to handle the banking and exchange difficulties which have arisen. The transfer of the note issue to the control of the general management of the bank should inspire confidence on> the part of the other banks and the business community generally, and should place the whole matter of the currency upon a satisfactory footing. The Commonwealth Bank started without any capital, and has accumulated profits amounting to about £4,500,000. It is proposed to capitalize £4,000,000 of these profits, to authorize the Treasurer to raise by way of loan sums aggregating £6,000,000, and to hand over the proceeds to the Commonwealth Bank as additional capital. When the whole sum has been raised, the Commonwealth Bank will have a total capital of £10,000,000. I hope that no honorable senator will fall into the error that an, honorable member made in another place, and assume that we are going to start the bank with a loan bringing up its capital to £10,000,000, upon which it will have to pay interest to the Treasury, whether it needs that amount or not. This provision in the bill means that the capital will be raised as it is required.
– Presumably, the Commonwealth Bank will have to pay interest to the Commonwealth Government on any money which is loaned to it, and added to its capital in that way.
– It will have to pay interest by way of- dividends. I shall deal with that matter later.- The Government does not propose to interfere with the authority already included in the Commonwealth Bank Act, under which the bank may issue debentures up to £10,000,000. It is not expected that the whole of the authorized. funds will be raised in the near future, but the Government thinks that legal authority should be - given for adding to the strength of the bank as and when the management finds that additional capital is necessary. The bank, of course, will pay the interest on any loan raised by the Treasurer for the purpose indicated.
– Will the interest which the bank will be called upon to pay be that paid by the Government for the loan?
– I cannot say that.
– Is this £10,000,000 additional to the capital of £10,000,000 already provided for by the act?
– Yes. The bank has power under the principal act to raise by debentures a sum of £10,000,000. This £10,000,000 is an additional amount. The Bank of Australasia has a total capital and reserves amounting to £7,746,000, and the Bank of New South Wales has similar .reserves amounting to £10,055,000. No alteration is proposed in regard to the distribution of the profits of the bank. As at present, one-half of the profits, not including the net earnings of the note issue, which are payable into the revenue of the Commonwealth, will be placed to the credit of the Bank Reserve Fund, and the other half will be paid into the National Debt Sinking Fund. One of the most important functions of a central bank is that of rediscounting, by means of which, under all ordinary circumstances, every other bank is able to convert its bills of exchange into legal tender money. The ability to :get cash in case of need is of the greatest value to banking. Though some of the banks urge that more legal tender notes be issued, they have said over and over again that all they really want is the right to get notes in case of need. Their attitude is quite understandable, because unexpected demands may reduce to an uncomfortable level the cash reserves of the most prudent banker. Moreover, whenever a slight monetary, stringency manifests itself, there is a tendency for bankers to make every effort towards an increase of cash reserves. Thus, the stringency is aggravated, unless there is a central bank, and the business world is placed under more restrictions than the case really warrants. There can be no doubt that a strong rediscounting central bank exerts a steadying influence in this direction, because confidence is inspired by a knowledge that help is at hand if needed. Of course, the right to get cash from a central bank, must be given with caution, otherwise there might be undue expansion, followed by an inevitable collapse. The safeguard lies- in the power of the central bank to increase its :rate of discount. The re*-. sponsibility of the central bank manager ment in this regard is very great, because the. whole of the business, of the country is (more .or less influenced by. that rate. The whole matter must be left to the new . board,, which. will be required ,to, publish
Kits., .discount rate only when, it , finds r itself in,’. a. j position to take .up. that usual function- ; of a central bank. Nothing in the, bill has direct reference to the handling ,of exchange difficulties. All that iCani.be done in this direction is dependent; 41Don the> power of the central bank . to, , -give, , . .assistance to the other banks., and .to arrange, with proper safeguards, for the seasonal fluctuation of the amount of .-currency. These are matters, not for legislation,, but for continuous management by an expert board, which will from time to time take all necessary action after full ‘consideration of tall the circumstances, and .which will be continuously .studying the situation from the’ point of view of the public interest, rather than from the point, of view of profit– making. A provision has been inserted in the bill, requiring the banks to settlebalances as between themselves by cheques drawn on the Commonwealth Bank. This will necessitate the keeping by each bank of some funds with the Commonwealth ‘Bank, and will tend to strengthen the central system. There is to be no compulsion as to the amount to be kept by any bank at credit with the Commonwealth Bank, but it is hoped that confidence in the new management will bringabout voluntary placing of considerable credits with the Commonwealth Bank, just as is the case with the Bank of England, which holds practically all the cash reserves of the ordinary banks, and which, in the true .sense of the term, is a bankers’ bank. It is desired that the banks shall’ be required to furnish statistics to a Commonwealth authority. The proposal . is that the details shall be arranged on a basis similar to that which has been used in the past for statistics furnished to state authorities.
I propose now- to ta;ke what is -a somewhat unusual course in a second-reading speech. I hope I shall not be out of order -at this stage in indicating certain amendments which the ‘Government believes it ‘ is necessary to make in the bill, and which will be submitted when we reach the committee stage. I am doing so now because the amendments will be circulated, and as they are of a very important character it is, I think, only fair that honorable senators .should have an opportunity of .studying their effect on the measure. In clause 5, dealing with the capital of the bank, we pro-, pose to strike . out . of paragraph b the . word “lent,” and insert the. word. “ granted.” This amendment is not soimportant as those to follow. In clause- 6, which relates to the power of the ‘Commonwealth to borrow money -to lend to -the” bank, we propose to insert the words “grant,” “grant,” and “the grant” in lieu of the words “lend,” “loan,’’ and “ loans.” This amendment is to make it ‘ clear that the money is not to be. repaid ‘ by the bank at any time, and that dividends calculated on an interest basis shall be payable to the Commonwealth .indefinitely. Honorable senators will remember that I postponed definitely answering a question which Senator Greene put. to . .me a few minutes ago on this point..
– That is to say, it is to all intents and purposes making it shareholders’ capital.
– That is so. In clause 7 dealing with local boards of advice, we propose to insert after the words “ Governor-General “ the words “ with the advice of the board.” This is to, ensure that a local board, shall be composed of men who are likely to work harmoniously with the central board. Obviously that is very desirable. In clause 7 also, dealing with note issue matters, we- shall ask the committee to strike out all the words after “ effective ‘” and insert the following: - “ Unless six directors vote for it when eight directors are present, or five directors vote for it when less than eight directors are present.” This amendment will remove invidious distinctions between directors, and will tend to the promotion of harmony in working. At. the same time, the provision will make it clear that decisions relating to the currency are very important, and require something more than a mere majority of the directors present. In France three censors must be unanimous before any decision relating to the note issue can be effective. To clause 12 we propose to add a sub-clause, striking out the word “Governor,” and inserting the word “ Board.” This will place with the board a power at present resting with the governor. “We shall also ask the committee to amend section 60 o of the act by adding the following: - “Provided that’ Australian notes shall not be issued to the Commonwealth Bank without the approval of the Treasurer.” This is. to prevent the board from issuing notes to itself on an unduly liberal basis. As the board will have power to determine the issue of notes to other banks, it is hardly right that it should also determine the issue of notes to itself without some check.
– Has not the trouble in the past been that the board would not issue notes when the Treasurer wanted it to do so ?
– That is a matter of opinion. I am not here’ to speak for the Treasurer in matters of that kind ; I would rather the honorable senator gave notice of his question. We propose also to repeal section 60 p of the act to give effect to a generally expressed desire that in so important a matter as the note issue, a change shall not be made except with the consent, of Parliament.
– That is the emergency section.
– Yes. In that part of clause 17, which deals with the settlement of balances with banks, we shall ask honorable senators to strike out the words “the 31st day of January, 1925,” and insert a “ a date to be proclaimed.” This will give to the banks an opportunity of doing voluntarily what is required by the clause., In that case proclamation may be indefinitely deferred. In clause 17, dealing with the nature of institutions to furnish statistics, after the word “ public,” we propose to insert the words <r and allows interest thereon.” This will exclude from the operation of the clause such firms and companies as receive deposits merely for the convenience of clients, and which do not allow interest. It cannot fairly be said that such firms and companies carry on the business of banking. If honorable senators will carefully consider the effects of the amendments, they will see that many of them arise from criticism directed by public bodies, and’ also in Parliament and elsewhere, to the bill. The Government believes that the amendments now proposed to the measure will silence that criticism, and generally tend to strengthen the bill..
– Is it proposed to extend j;he time allowed’ with regard to the forfeiture of inoperative accounts ?
– I do not think there is in the measure any provision dealing with that matter.
– The time is quite long enough anyhow.
– In conclusion I may say, in answer to- a question asked by Senator Greene, that it will be the definite function of the bank to discount foreign bills. It will be profitable to do so.
Debate (on motion by Senator Gardiner) adjourned.
.- I move -
That the bill be now read a second time, I submit the: bill without offering any apology, because I have felt for a considerable time that such a measure is necessary if we are to get the best results from our system of compulsory enrolment. For some time we have been spending annually very large sums of money in the enrolment of electors. We have even gone so far as to compel electors, should they change their places of residence, to notify the divisional returning officers within a specified time, failing which they are liable to a fine. We should, I think, recognize that the natural corollary to compulsory enrolment is compulsory voting. Claiming to be a democratic community we naturally expect the people of Australia to be sufficiently interested in the constitution of the national Parliament to see that it is thoroughly representative of political thought in the electoral divisions. Unfortunately,- this claim cannot be substantiated. All our efforts to retain interest in electoral matters have failed lamentably ‘during the last few years. At the last Commonwealth elections in 1922 we were in the most unenviable position that only 57.95 per cent, of the people entitled .to vote exercised the franchise. Taking the Senate election results for that year, the figures’ for the different states showed that New South Wales polled 54.49 per cent, of the total number of electors enrolled. In Victoria the percentage was 56.23; in South. Australia, 53.23; in Western Australia, 46.71; in Tasmania, 45.63; and in Queensland, 82.66. These figures disclose that out of a total population of a little more than 5,000,000 of which 2,982,424 are electors, 1,254,178 electors failed in their duty.. That fact should, of itself, commend this measure. Parliament is supposed to be a reflex of the mind of the people. If the people exhibit no interest in the selection of their representatives, it must necessarily follow, in the course of time, that there must be considerable deterioration in the nature of the laws governing the social and economic development of this country. We claim, with a certain amount of pride, that our national legislature of Australia is based on democracy. The presumption is that our laws are enacted by a majority of the electors represented by a majority of the members in this Parliament. Actually, however, a Parliament elected by less than one-half of the electors places upon our statute-book laws, which govern the policy of the Commonwealth. That surely is a travesty on democratic government, and was never contem- plated when we adopted our present electoral system and provided for compulsory enrolment.
– Compulsory enrolment may be useful to the Income Tax Department.
– Yes; but it has failed to cause a great number of Commonwealth electors to take an interest in public questions. Many reasons are assigned by electors for not going to the poll, and many business men whose interests are usually confined within the walls of their dwellings or places of business, when asked if they intend to vote, say that they have not any time for politics. Apathy and indolence of that description are to be found in all directions, and then is a large section of people who derive all the benefits available from legislation enacted but who never accept any individual responsibility. Compulsory enrolment enables our rolls to be as complete as possible, but there can be no advantage to the country if the electors who are co’mpulsorily enrolled do not exercise their right on election day. If the amendment of the electoral law, which I am submitting, is enacted, it will be found that in a short time there will be a wonderful improvement in the political knowledge of the people.
– Compulsory voting is in force in Queensland.
– Yes. Queensland has had compulsory enrolment and compulsory voting for some time. The Queensland measure relating to compulsory voting was enacted in 1915, and at the last federal elections, held in 1922, 82.66 per cent, of the total number of electors enrolled voted. Although federal electors were not compelled to exercise the franchise on that occasion, the fact that they had been accustomed to voting at state ‘ elections enabled Queensland to occupy the proud position of polling practically 26 per cent, more than any other state. I do not suggest that compulsory enrolment will compel every elector to go to the poll at the first Commonwealth election held under a system of compulsory voting, but we could reasonably anticipate that the increase in the number of. votes polled throughout Australia would be equal to 25 per cent. If such a result could be achieved it would more than justify an amendment of the law in the direction I propose. The fact that legislation was considered by members representing a greater number of people than hitherto would have a good effect upon the community. We are only a young nation, with great problems still to solve, and unless something is done to revive interest in public questions the outlook in regard to future legislation cannot be particularly bright. There is in our midst a number of people who, owing to religious convictions, will not go to the poll on election day. They claim that they are taught not to participate in elections, but they will not break the law.
– They must be religious cranks.
– I do not suggest that. I believe in every man and woman having the right to his or her religious opinion. The measure I have submitted is not a lengthy one. It has been drafted on lines laid down by the Federal Parliament in 1915, when an act providing for compulsory voting in connexion with a certain referendum, which was not submitted to the people, was placed on the statute-book. It is not based on the Queensland act.
– What fines are proposed for non-compliance with the proposed law t
– The provisions of the bill may be briefly stated:
Sitting suspended from 6.30 to 8 p.m.
– Briefly, clause 2 provides that it shall be the duty of every elector to record his vote at each election, and the duty of each divisional returning officer, at the close of each election, to prepare a list of the names and descriptions of the electors enrolled for his division who have not voted at the election, and to certify the list by a statutory declaration under his hand. Within a prescribed period after the close of each election the returning officer shall post to each elector whose name appears on the list he has prepared, a form on which the elector is required to state the reason why he did not vote. Upon the receipt of the replies, which must be furnished within a prescribed time, each returning officer will note opposite each name on his list his opinion whether the reason advanced by the elector for not voting is a true, valid, and sufficient reason. If it is not a true, valid, and sufficient reason the elector will be liable to a penalty not exceeding £2 for his failure to record a vote.
– What does the honorable senator mean by “ a true, valid, and sufficient reason “ ?
– Under the Elec- ‘toral Act persons who are incapacitated through illness, or persons who from any other cause are unable to attend at a polling booth to record their votes, may vote by post, but certain authorized witnesses are required not only to enable a postal vote to be recorded, but also to enable an application for a vote to be made. It is quite possible that many persons are so far away from the nearest town that no authorized witness is within their- vicinity. An elector so situated, and with no means of getting to a polling booth, would have a valid reason for not exercising his vote. The provisions of this bill are directed against those who. have facilities to vote, but fail to do so. If we made an analysis of the voting in any locality we should find in all probability that the number of persons who, with every facility to reach a polling place, failed to record votes was as large as the number of those who were unable to vote because of distance from persons authorized to witness postal votes or lack of facilities to reach a polling booth. In conjunction with the Electoral Act this bill will provide every facility for the recording of votes, but those who wilfully abstain from voting will be liable to a penalty of £2. The main object is to compel those who enjoy all the privileges of living in Australia, and all the advantages of Australian law, to take a keener interest in the welfare of their country than they have hitherto shown. It is deplorable that such a large percentage of those who are qualified to vote, and have already complied with the compulsory enrolment provisions of the Electoral Act, should refuse, . sometimes without any reason whatever, to accept any individual responsibility for the selection of the men to be entrusted with the task of framing the legislation about which, as a rule, they are the very first to complain. There is no need for me to labour the question. I believe that the principles of the bill commend themselves to honorable senators. We have a democratic Parliament, and if we desire to maintain democratic government we should do our best to force those who live under that form of government to see that it is democratic, not only in name, but in deed.
– Senator Payne has brought forward a democratic proposal to which I take no< exception, although, as a rule, I view with grave suspicion anything in a democracy that savours of compulsion. According to the figures given by the honorable senator,, only 45 per cent, of the people of Tasmania voted at the recent Commonwealth election as against 82 per cent, of the people of Queensland. I fail to see the justice of the claim that if 55 per cent, of the people of Tasmania believe that there, is no candidate whose name is. on the: ballot-paper for whom it is worth while to vote, they should be- compelled to vote. However, I recognize that we cannot stand still in electoral matters, and that there is a spirit abroad that something should be done to compel people who are indifferent, or even those who do not appreciate the character of the candidates offering, to go to the poll. I am not too sure that compulsory voting will be a satisfactory solution of the trouble, and I really think that I am voting for the bill because it is. part of the. Labour platform that people should be forced to vote. The State of Queensland adopted compulsory voting in 1915, and as. the result a Labour Government has been in office in that state ever since. Measured by that result the bill introduced by Senator Payne is a most excellent one, but I am not too sure that similar laws produce the. same results under every condition. I have a just cause fox complaint against Senator Payne in that his vision is too- narrow. At the last two elections for the Senate, the candidates suffered from a system of counting votes under which the. electors were not. given the opportunity to. have their votes counted for more than one of their candidates, although there were three vacancies to be filled. In conjunction with Senator Payne’s proposal, provision should’ be made to alter this pernicious system and allow every voter to have a vote counted for each vacancy to be. filled. When it was my good fortune to be elected in 1919, the votes recorded for the other candidates of the Labour party were not counted, yet, according to the result of the succeeding election, Senator McDougall would have polled more than I did if his votes had been counted on the oceasion on which I was elected. When I was out of the way, and he had the opportunity to get the votes cast for him counted, he was also elected..
– That being the case, what more does the honorable senator want ?
– I do not want the people to have to wait for three years to secure the election of a senator who, under a less absurd system of counting votes, would have been returned to this chamber at an earlier date. I want every elector to have the opportunity to give a vote to fill, each vacancy.. I do not like piecemeal electoral reform because an honorable senator is smitten with a splendid idea of compelling people to vote. I believe that Senator Payne’s proposal will become law, but I do not know that the question of compulsion has been settled even on the case the honorable senator has’ submitted. I do not know that it ought not to. he left to the liberty of the individual elector to exercise his judgment as to whether he should vote or not. I shall submit an amendment to provide that it shall be regarded as a valid excuse for not voting if the person has objections to voting on religious grounds. It must be remembered that Saturday is regarded as the Sabbath by a large section of. the community.. There are also many people who object to voting on principle. Senator Payne seems: to think that as religious people are lawabiding they will not break the law, and, therefore, will vote if the act says that they must do so. Every consideration should bo shown for the religious susceptibilities of even the smallest section of the community. ‘ If any elector notifies the electoral officer, before the issue of a writ, that he objects on religious grounds to exercising his vote, it should be a good and sufficient excuse for not voting:
– All people could do that.
– The bulk of the electors’ would comply with the ordinary requirements, of the- law. Compulsory voting involves a further trespass on the liberty of the people. How often do electors find themselves in the position of having to vote for candidates whom they do not desire to support? I hold the view that the opinions of the negligent and apathetic section of the electors are not worth obtaining.
– We should educate that section.
– Compulsory education can be applied successfully to the young, but to apply it to adults is a different matter. If we compel people to vote we have no guarantee that they will register a formal vote. I believe that the proposal before u3 is a plank of the platform of the Labour’ party, and, seeing that it has been introduced by a Nationalist, I suppose that I am committed to vote for it, but to- my mind it represents a further trespass upon the liberty of the people. The whole trend of state and federal legislation is in the direction of further interference with the liberty of the subject, and the people will eventually revolt against it. I realize that this interference is the . price that has to be paid for the benefit of government, but it is possible to make the price too high. In committee I intend to submit an amendment, for I think it wise to -exempt any elector who, prior to the issue of the writ, notifies the returning officer that he has a religious objection to voting on the particular day fixed for the .poll. Unpalatable .as the bill will be to thousands of people,, it will be less objectionable if it does not -cut across the grain of their religious beliefs.
– It is true that compulsory voting is a plank of the Labour party’s platform, and supplements the provision made some years ago for compulsory enrolment, which has not proved the failure that many people predicted it would be. It is regrettable that at the last election a large number of electors failed to exercise their obligation as citizens of the Commonwealth. Some of the opponents of the Labour party stated that success came to it by reason of the small percentage of the electors who recorded their votes, but I maintain that the larger the poll the better the result to the Labour party. Many important issues hung in the balance at that election, and why the people refrained from exercising the franchise passes my comprehension. I do not call an Australian a true citizen if he does not realize to the full his responsibilities of citizenship, since the right to vote has been won for him ‘without effort on his part.. My mind carries me back to the Chartist movement of .1848. I remember reading of the early struggle in .England for the franchise. I re. collect reading the report of a banquet tendered, on the anniversary of his 79th birthday, to the Marquis of Lincolnshire, formerly known as Lord Carrington, who was once Governor of New South, Wales. In responding to the toast of ‘his health he spoke of the Chartist movement, and of the Life Guards then being quartered in his father’s stable. He also recalled the fact that cannons had been placed on Westminster Bridge, and he remembered being told by his father that the Duke of Wellington had ‘ been instructed to marshall his troops to prevent the Chartists from presenting their petition. The Marquis of Lincolnshire added that he had lived to see all the principles of the Chartists made law except one. In those days they were -considered dangerous and revolutionary, and -a menace to the peace and ‘good government of the Empire. With the passage of years the right to vote by ballot has been won for us, (but I regret that, on account of systematio canvassing, the secrecy of the ballot is sometimes violated. Every citizen of adult age, irrespective of poverty or wealth, enjoys equality of voting power:
– Except in regard to the Legislative Councils.
– I am speaking, of course, of the federal franchise. Adult suffrage was not in vogue when the Commonwealth Parliament was ‘constituted. I was associated with those who carried on a consistent agitation in favour of the enfranchisement of the womanhood of Australia, and after a short period adult suffrage was granted, but I regret to say that it has not yet been embodied in the. Constitution. It is now proposed by Senator Payne, that voting shall be made compulsory. W6 can take a horse to water, but we cannot compel it to drink. How, therefore, can we compel people, by a system. of compulsory voting, to record an effective vote. I believe that, if a person feels that he must attend a polling booth or be liable to a fine of £2, he will record a vote, even though it be an ineffective one. At the last Victorian state election I experienced difficulty in ‘choosing between candidates “ A “ and “’ B.” The election of neither, I considered, would confer any advantage on the party to which I belong. But, as I ‘have always advocated that an elector should exercise his right to a vote, I considered that I should not set a bad example by refraining from voting. Before I entered the polling booth my intention was to make my vote ineffective, but I altered my mind, and voted effectively. At the last federal election nearly 1,250,000 of those who were enrolled did not record a vote. I know that hundreds of names appear on the rolls which should hot be there. No matter what the system might be, it would be difficult to prevent that. The names of those who constantly refrain from voting should, after a time, be struck off the roll.
– What would be the use of that?
– Less work would be involved in the compilation of the rolls.
– It would accentuate the present disadvantages.
– It would not. If those persons at any time found fault with the legislation that had been enacted, they could be asked, “ What have you to do with it? Your name is not on the roll, and you did not take an interest in public matters when you were enrolled.”
– Such persons frequently air their views to electors who are unaware that they have not recorded a vote.
– That is true. In what way does the honorable senator propose to prevent it?
– By compelling them to vote.
– That would not get over the difficulty. The bill makes the following provision by clause 2, subclause 4 -
Within the prescribed period after the close of each election the divisional returning officer shall send by post to each elector whose name appears on the list prepared in accordance with sub-sections (1.) and (2.) of this section, at the address mentioned in that list, a notice,- in the prescribed form, notifying the elector that he appears to have failed to vote at the election, and. calling upon him to give a valid, truthful, and sufficient reason why he failed so to vote.
Under that provision 1,250,000 notices would have had to be sent out after the last federal election.
– A big proportion of that number would have voted had there been compulsory voting.
– In Queensland notices are sent out.
– Prior to the last election notices were not sent out in Queensland. The voting right in that state was exercised by approximately 83 per cent, of the persons enrolled. In that case it would be necessary to send out probably half a million notices.
– The Metropolitan Water Supply and Sewerage Board in Brisbane sends out notices to those who fail to vote.
– If £2 were collected from each elector who did not vote, it would pay to send out notices.
– That is the maximum penalty, which is rarely imposed. I agree with the main principles underlying the proposal to provide for compulsory voting. Elections are becoming very costly in Australia, and there is a big section which feels that it is incumbent upon the candidates, or the parties supporting them, to convey them to the polling booths. It was one of the proudest days of my life when I became possessed of the right to cast a vote, and I walked a considerable distance to record my vote. Now a fleet of vehicles is provided, costing a considerable sum of money, to convey electors to the poll. Conveyances should be placed at the disposal of those who are physically infirm, or unable to walk to the polling booth, but no difficulty would be experienced by the great majority of voters, particularly in constituencies that are not extensive in area, if they had to use “ shanks’s pony.” I believe that compulsory voting would considerably minimize the cost of elections. The National party possesses unlimited funds, and is in a position to commandeer all the uptodate motor cars that are available at election time. The Labour party is not so well circumstanced. I do not know what are the views of the Government respecting this measure, but I feel that I cannot vote against it.
– The honorable senator does not want to vote against it.
– Some persons will say that we should . not concern ourselves with those who are not interested in the welfare of the country, or in the legislation that is enacted by the Government of the country, that we should allow them to go their own way. I do not share that view. I say that it is the duty of the citizens to take an interest in the welfare of their country, and to exercise their right to choose a representative on election day. I therefore think that it would be a step in the right direction to provide for compulsory voting.
– If this bill is passed, does the honorable senator think that there ought to be a double dissolution to see how it will work?
– The honorable senator ought not to talk about double dissolutions in this chamber. We have had one double dissolution, and it was disastrous to the party of which he is a member. The bill, if passed, will probably involve the Electoral Department in a greater amount of work, but, at the same time, it will stimulate interest in matters that are of vital moment to the people of Australia. It is regrettable that indifference and apathy were displayed at some recent elections. Nothing is more harmful to the government or to the country. At the last federal election the complaint was general that it was impossible to secure audiences, and that it was difficult to interest the people in the very important questions that required to be considered. The bigger the interest taken by. the people in the elections, and the larger the vote that is recorded for one party or another, the better for the people and for the Government.
– I did not intend to speak to this motion, but as the discussion has developed it has provided me with food for reflection. I intended to consider this proposal very carefully, but some of the speeches that have been made have placed me in a quandary. I listened with great attention to Senator Gardiner when he was informing the Senate that he believed that this was a very important part of the programme of the Labour party. At the same time, however, he did not fail to exhibit qualms of conscience as to whether it would be in the interest of the people to introduce the nasty element of compulsion. I am inclined to favour that view, but I am sorry to find that there ‘ are so many conscriptionistson the opposite benches who have become seised of the necessity of almost taking decent citizens by the scruff of the neck and compelling them to attend the polling booth :to record a vote. I do not believe in conscription! I hate it at any time if there is any possible alternative. I was sorry to hear Senator Findley speak so pronouncedly in favour of the conscription of the citizens I What is the world coming to ? I stand for freedom ! - Honorable senators opposite promulgate the theory and seek to establish freedom by outraging it. They seek to preserve liberty by strangling it. I stand where my forefathers stood, and shall preserve to the utmost of my power that last remaining vestige of freedom which Senator Gardiner says is trembling in the balance and is now about to be assaulted by this proposal of my respected friend, Senator Payne! I am placed in a quandary. I do not know where this new-fangled idea will lead me. I foresee all sorts of difficulties. I am of the opinion that these attempts to tinker with our electoral law, instead of accomplishing the object sought, will lead to a directly opposite result. I remember that prior to tie last federal election the grouping system was introduced by this Government, of which I am such a servile supporter. In this chamber I raised a lone voice - a voice crying in the wilderness - asking honorable senators to return to common sense and to recall what the adoption of that system would mean to our electoral machinery. How has it panned out? Has it reduced the number of invalid votes? I do not like tosay, “I told you so.” I do not like people to look upon me as a prophet. Although I am a prophet in a certain sense, I want that to be understood without having to state it. I do not care to call attention to my qualifications. I pointed out at the time that this grouping system would lead to a result the very opposite of that intended. This system was imported from America, where it is the worst feature of the electoral law. It is a form of compulsion which, instead of reducing the number of invalid votes, has almost doubled them. These newfangled ideas should not be introduced until the ground has been thoroughly tested. Let us suppose that the Federal Parliament, in its folly, embodies the principle ‘ of compulsory voting in the electoral law, and thereby still further disfigures that law.
Imagine a decent-minded citizen being dragged to the polling booth and being required to record .his vote. Suppose, for instance, that a man named Michael Murphy did not go. Hitherto, when imaginary personages have been referred to for the purposes of illustration, “ John Smith,” “Bill Brown,” or some other man with an English name, has had a monopoly in this matter, and I want now to give a countryman of mine a chance. So I say that, suppose Michael Murphy, the elector in question, failed to go to a polling booth to record his vote. Suppose, further, that there was another Michael Murphy in the neighbourhood. The first Michael Murphy, having failed to record his vote, on being asked for his reason, might plead guilty, but offer as a perfectly fair excuse, and one which certainly has been very prevalent of late, the plea that he was so full of political ignorance that he did not know which way to vote, so he stayed away from the booth on polling day. Imagine then the presiding magistrate saying to him, “ Why did you not inform your mind?”, and if he replied, “How could I do that?”, the obvious suggestion for the magistrate would be, “ Read the newspapers.” Leaving out of consideration altogether the possibility of our friend Michael Murphy not. being able to read - which would, of course, greatly complicate matters - what would be the position ? Imagine any man toeing compelled to read the Melbourne newspapers, or, at all events, some of them’.
– He might read the Aye.
– Well, the Age never reports what I have to say, because on one occasion I chastised that journal rather severely. The Age is free to flagellate public men, but if any public man dares to turn round and criticize that journal, woe betide him ! Henceforward his name will never appear in its pages. But let me return to my illustration. Does not Senator Findley see that if we take one foolish step we must take another, and that if a man, by reason of compulsory enrolment, is to be compelled to vote, he will be obliged to read the newspapers to inform his mind? Otherwise he must go down to the Yarra bank. Imagine the independent citizens of this country being compelled to go there to get their political ignorance dispelled ! All these, I -remind honorable senators, are possibilities arising out of this bill. All these things, I repeat, are possibilities. This is why there is a doubt in my mind eta to the wisdom of passing the measure. Such things take a lot of consideration. I see, by the way, that it is on the Labour party’s platform. It was not on that platform at one time. It got there lately. I suppose, of course, it has been put on the Labour party’s platform for a perfectly altruistic reason, not, surely, to advance the interests of the party, or to increase its members in public favour ?’ Not for a single moment ! But we have been told by the Leader of the Opposition. (Senator Gardiner) that it is on the Labour party’s platform. Why? We will assume that it got there by some mysterious process; but not, mark you, for party purposes’! Now I can see some light. The Labour party has come to the end of its tether. We are told by Mr. Theodore that there are dreamers and visionaries within the ranks of the party; that there are faddists who can .fad, but can do no more. Since this proposal is on the Labour party’s platform, but not for party purposes, it would seem that the Labour party has come to the end of its tether. Its members do not expect to make any further political progress.
– They cannot, if they have come to the end of their tether.
– Of course. Imagine the Labour party attempting to put into operation the objective of its extremists. The Labour Government in Tasmania, honorable senators will note, has sold its ships ; and nothing .has happened to it. I was ‘expelled from the Labour party for something not nearly so serious as that departure from Labour policy; but the Labour Government in Tasmania, being a law unto itself, can turn Government ships over to private enterprise and nothing happens. In their case the .position is different. In Western Australia the only socialistic butter factory in the country was sold - also by a Labour Government. The Labour party, I repeat, has come to the end of its tether. From all that has happened lately, it would appear that from 30 per cent, to 40 per cent, of the people do not give a hang how they vote. They are tired of both parties, and stay at home to mind their own business. But amongst that 30 per cent, or 40 per cent, there are few who want to follow the modern torch bearers out of the wilderness of social darkness. There is one party that has dropped the .torch bearer. That party, I need hardly add, is the Labour party.. This proposal should be weighed very carefully. I can see ahead difficulties, that might easily make it inoperative. It is an attempt to manufacture public opinion, instead of allowing it to evolve along natural lines. I am against all such, proposals. I think, with Senator Gardiner, that whilst there is a remnant of that liberty remaining to us we should cherish it, instead of allowing’ it to be filched from us by shortsighted visionaries. Although I respect Senator Payne very much, and recognize that this bill is an endeavour to improve the present condition of things,. I am still doubtful. It was. thought that the group system, to which I have referred, would be an improvement. It was nothing of the kind. It only increased the number of invalid’ votes. For the moment, I do not know how I am going to vote upon the measure. I shall require time for consideration. In the meantime, I hold my opinion in reserve. Whether I shall vote for the bill depends very much upon how the debate develops.
– At one time, people were prepared to fight for the right- to exercise the franchise. To-day the position is completely changed. Elected members of Parliament, and their supporters, have to exercise the most strenuous efforts to induce some electors to record their votes. Notwithstanding all that,- is done, a large number of people persistently refuse to go to the poll. In fact, many people, year after year, decline to take the necessary steps to become enrolled.. Some years ago Parliament decided that, enrolment should be compulsory, and enacted a penalty for failure to do so; but there is a great reluctance on the part of the authorities to enforce the penalties.
– A large number of penalties- are enforced every year.
– As a rule, the fine is half-a-crown or thereabouts.
– The defendant, has 1o pay costs as well.
– Even _ under the present system a great many people fail to enrol, and now it is proposed to go a step, further and compel the people to vote. This system has been in operation for some years in Queensland. I am not quite sure, but I think that, on an average, a fairly substantial percentage of the electors exercise the franchise.
– Up to 89 per cent, in oue division.
– At all events, they have succeeded in retaining a Labour Government in office in that state. I do not think that compulsory voting is enforced in amy of the other states, but since there is now a Labour- Government in every state except New South Wales, and as compulsory voting is only operating in Queensland, it does not seem that the proposal will necessarily be to the advantage of my party. Whilst I am prepared to admit that it is possible to force people to the poll, I doubt very much if the re- . suits will be much more satisfactory than they are to-day under the present system.
Senator Hoare. The position in Queensland shows that they will be.
-Everything is quite right, so far as that state is concerned. It only requires another turn of the wheel to make the position more satisfactory from our point, of view in this parliament. The. bill proposes to apply the compulsory methods of voting to the Commonwealth, elections. Objection has. been raised to certain sections of the Act, including the grouping system, the method of voting, and so on. Those objections are somewhat beside the issue, but on that point it seems to me that the exhaustive group preferential voting ensures, amongst other things, that the party securing the greatest number of votes will get a majority of representatives in the parliament. It is as . if the old method of placing^ a cross in front of the candidate’s name were adopted and continued by the elimination of the last candidate. That is how it works out, and the method is a satisfactory one. Quite a number would prefer to return to the system under which a cross was placed in front of the candidates whom an elector supported,, and while that is, in a sense, satisfactory, it is quite obvious that under such a system the votes of those who supported a minority would be lost. Under the present system such votes- are transferred to- other candidates-. . The DEPUTY PRESIDENT (Senator Newland) - I ask the honorable senator not to continue that line of argument.
– Senator Gardiner was allowed to. discuss such matters for a considerable time.
The DEPUTY PRESIDENT.- Order ! The honorable senator has already been called to order for departing from the provisions of the bill. I ask him to discuss the question before the Chair.
– I shall do so, but on the next occasion when I think an honorable senator is being given unnecessary latitude I shall call your attention to the fact. To-night Senator Lynch was allowed to roam-
The DEPUTY PRESIDENT.- I have allowed the honorable senator >a good deal of latitude, and I now ask him to discuss the provisions of the bill.
– I am obliged to bow to your ruling, Mr. Deputy President, and I shall do so. We are asked to agree to a proposal embodying compulsory voting at federal elections, which is a complete departure from the present system.
– The principle is embodied in an act that was passed in 1915.
– Yes, but that act has never been in operation. If this measure is passed, the act will become operative at the next federal elections. 1 am not altogether opposed to experiments of this character, but I realize the force of some of the arguments submitted to-day. To compel persons to go to the polling booth and to number the names of the candidates on the ballot paper in their order of preference may be possible to a certain point, but, even when these people reach the booth, they cannot be compelled to record a formal vote. I do not anticipate that, in many cases, they will wilfully record an invalid vote, and, on the whole, compulsory voting would, I think, be an advantage. I should like the honorable senator who introduced the bill to more .clearly provide who shall be exempt from the provisions of the measure. I do not wish a general election to be held on any day other than a Saturday, although that day is the Jewish Sabbath, and a number of estimable citizens have an objection to voting on such days. People should not be compelled to act contrary to their religious scruples,’ but, if a time could be arranged at which they could vote, without any infraction of their religious principles, I do not think any objection would be raised. Consideration must also be shown those physically incapacitated and those who are not Within a reasonable distance. of the polling-booth. Such persons should be exempt. Although the proposal is an innovation in connexion with federal elections, the principle is one which ought to be adopted. If it is found that it does not work smoothly the act can be repealed. I shall support the second reading of the bill, but in committee I shall ask that provision be made not to penalize those who cannot vote owing to physical or other disabilities.
Question resolved in the affirmative.
Bill read a second time, and reported from committee without amendment or debate.
.- I move-
That, inasmuch as the Commonwealth Parliament, after grave consideration, has fixed the amount of protection that each individual industry should enjoy from unfair oversea competition, the Senate is of opinion that no tenders should be accepted for Government requirements, the effect of which would be to raise the rate of duty above that applicable to the commodity required and thereby to upset the judgment and determination of Parliament.
This motion, as clearly indicated by its wording, briefly means that I wish to preserve intact the full and complete power of Parliament. Theoretically, the Parliament of the country is supreme. It has the sole duty of enacting the legislation of the Commonwealth, and has also to see that that legislation, whether it be good or bad, is administered in the spirit in which it was passed by Parliament. The action of the Government in accepting a local tender for fourteen locomotives for use on the Port Augusta to Oodnadatta railway - a tender which was considerably higher than others- necessitates a discussion of this character. I am quite aware that Governments on every occasion have ‘the liberty of exercising their best judgment without it being subject to the review of Parliament at the times, but in this case the Government, of which I am a supporter, has exceeded the authority of Parliament. The particulars in connexion -with the purchase of these locomotives are somewhat startling. In the first place, tenders were invited for fourteen locomotives, and prices were submitted from English and Australian firms, and, I believe, from some continental manufacturers. The tender of Messrs. Thompson and Company, of Castlemaine, which was for £136,400, was accepted,, although the lowest British tender’ for similar engines was £81,200. The engines were to be delivered under steam for trial purposes. The lowest British tenderer would have had to pay a duty of 27^ per cent., which would have amounted to £19,800. That amount added to the tender price of £81,200 makes a total of £101,000, which still is £35,400 below the Castlemaine tender. It is quite clear that this is a very big sum to pay on fourteen engines, even if the owners of those engines paid duty on them and placed them on the Port Augusta-Oodnadatta railway line. If we add this £35,400 to the duty they would have paid in any case, we find that the effective protection afforded to the- local manufacturer is the extraordinarily high rate of 76 per cent, above the price of the British tender. It was never intended by this Parliament that any Australian manufacturer should receive such an excessive rate of protection.
– It is nothing in comparison with the shipbuilding stunts.
– I quite believe that. Although the Government may have had the best of intentions, it did not consult the interests, of the people, particularly those in the interior, who are to be served by the engines for which the tenders were called, when it gave Thompson and Company, of Castlemaine, protection to the extent of 76 per cent. It was a good thing for the Thompsons of Castlemaine, but a mighty bad thing for the Thompsons of the “ Never-Never.” The Port Augusta-Oodnadatta railway is the most shocking example of a bankrupt railway line. According to the report of the Commissioner of Railways, the total loss on the line - which is 470 miles in length - for the last eleven years has been £1,346,000, at the rate of about £122,000 a year. Is not that huge loss sufficient for the taxpayers to stand without adding to it over £55,000 on fourteen loco motives for use on the line?- The annual loss on the line is sufficient to pay interest on £2,480,000, about the cost of one of the cruisers the Government proposes to purchase. The running costs on the line have increased from 10s. 9d. to 14s. 7d. a mile during the last two years. If, during the consideration of the tariff in this Parliament in 1920, it had been mentioned that the time would come when the Commonwealth Government would allow between 70 and 80 per cent, additional protection upon Commonwealth requirements in favour of the Australian manufacturer, the suggestion would not have been tolerated. I fail to see why we should now be called upon to place this extra impost on the cost of affording means: of transport and communication to men who are trying to develop the interior, so that a firm of engineers in Castlemaine may produce fourteen locomotives. I am a Protectionist. I have always been a Protectionist. Since I have been in this Parliament I have consistently given votes to foster the industries of Australia within reasonable limits; but I. do not propose, in this or any other case, to go to the extreme fanatical limit of imposing such outrageous rates of duty as have been imposed in connexion with the contract for these locomotives. Where will it end? If this Parliament lets the matter go by default, the Government will assume, and will be entitled to assume, that its action o.i this occasion has been endorsed. The Senate has an ample opportunity to awake to a sense of its responsibility and say what it thinks on the matter. I am not prepared to share any responsibility for the imposition of these outrageous rates of duty. I wash my hands of the imposition of any excessive duties which press more heavily than even the tariff does on the primary producers of Australia. I am always in favour, of a fair thing, but when we see how protection is working in Australia, and when we are told by Senator Kingsmill of the extraordinary prices that are being paid for the construction of vessels in Australia as compared with the price at which they can be bought in Great Britain, we are led to the conclusion that, under our baneful system of protection, a section of the people, is not doing its duty to the country, while at the same time it is benefiting by the patronage of the Government, and of this Parliament, in the shape of excessive protective duties. I raised my voice on a former occasion upon this subject, and I hope to continue doing so, because I have some sympathy for the men who are helping to develop the country without protection, and who are holding their own in the markets of the world without a particle of government help. A glance at the map shows that the railway line for which these locomotives are intended crosses a part of the continent, vast and limitless it is true, but certainly of a description that will not permit of heavy expenditure on the part of the men who take it nip for pastoral or any other purposes. For the time being cultivation of that land is out of the question. No one will go there unless he has sufficient inducement, not only to make ends meet, but also to make a fortune within the space of his natural life. If he succeeds, .good luck to him, but if he is to be saddled with the extra expense of having the locomotives that are to give him means of communication made in Australia under the protection afforded by an excessively high rate of duty, how can he be induced to go there, either to help to people it or to develop it ? It may be away from the subject, but I say again that the effort which is being made in Australia to bring about a kind of equality between citizens engaged in different industries is an absolute sham. We urge people to go to the dry and waterless areas and try to grow wheat, as it may be grown in .the neighbourhood o’f the Port Augusta-‘Oodnadatta railway, and, at the same time, we saddle them with extra duties in order to foster and encourage men who have the hardihood to ask Parliament to impose these extra duties to put them on an equal footing with people engaged in the same industries in other parts of the world. . The time will’ come when those who are expected to go out into the interior and bear the heat and burden of the day will refuse to do so if, at the same time, they are also asked to bear their share of the cost of pampering and coddling city industries by all forms of extravagant protection. That is why development is now arrested in a part of Australia which every well-disposed citizen is anxious to see developed. If a man loves his country to any extent, he had better put his love to the test by seeing that a fair deal is done between people engaged in rival fields of industry. Let him give certain industries a fair degree of protection, but let those who receive that protection deliver the goods, and let the degree of protection not be that which makes people lazy and flabby and absolutely reliant on excessive rates of duty, and dole after dole, as evidently these people ia Castlemaine are. Was it ever con-t templated that men would ask for such a protection? Yet they have been given protection to an extent that must press more heavily as time .goes on upon that section of the community that ‘deserves more at our hands than do any people situated in .such a pleasant location as Castlemaine or anywhere in the State of Victoria. It is time we called a halt in this matter. I appeal to those protectionists who think that protection is in the interests of the country, to hold the scales with some .semblance of fair-; ness between those who are supporting a protection policy for the young industries of Australia and those who are earning undreamt-of incomes because of the duties imposed in particular cases. One would have thought that Mr. Hoskins, who was here during the passage of the Tariff Bill, was on his last legs, yet I suppose to-day he is one of the most independent and wealthy ironmasters of Australia. , In Sydney, there is ,a huge pile of buildings going up - almost blotting out the sun - which, I am told, belongs to Mr. Hoskins. That gentleman made it ‘his daily and nightly duty to rest on the doorstep of this Parliament House seeking the imposition of duties. As a result of his efforts he has been enabled to put up a monu-mental building ten or twelve stories high in the heart of Sydney. I could understand if, out of the proceeds of these excessive duties, he had done something to develop the interior of Australia. If he did something to. help those who assisted him to make his colossal fortune; I should not mind .so much. He must have made that building out of the proceeds of the industry he led this Parliament to believe was unprofitable. I ask myself if I am justified in enforcing this policy of protection, which is laying .such a heavy burden on the endeavours of those who are holding Australia for us - if they will not hold it, no one else will - while at the same time it . is enabling others to build up vast fortunes such as those made by Hoskins and Company, and others. Possibly Thompson, of Castlemaine, will erect a big building in Melbourne. Good luck to him if Parliament will allow him to do so, but he will not do it with my consent.
SenatorKingsmill. -What about the Sunshine people
– I know Mr. McKay very well. He came to the Senate, and from the appeals he made. one would have thought he had not a second coat to his back. But he does not stand alone. Others are in the same boat so far as seeking favours from the Federal Parlia ment is concerned. The sequence is palpable. Alter coming to this Parliament, or sending agents here to represent them, they have succeeded in amassing fortunes at the expense of those people who go out into the interior, and with breaking hearts, broken boots, and poor fare live like dingoes in the black fellow’s country, lucky if they end their lives outside the Bankruptcy Court.
SenatorMcDougall. - The people whom the honorable senator condemns pays his expenses.
– Who do?
SenatorMcDougall. - They contribute to the funds of the National party.
– I am a member of that party, and’ I have a letter from the organization which will put a very different light upon the subject. The letter is from Mr: Wilmott Cooke; the finance secretary of the National party, and the concluding sentence reads -
The basis of contribution to the party funds. is £30 per annum for each senator. There is no allowance made in respect of election years, but should you desire to raise the question you might write to me, and I will bring it before the committee.
Thirty pounds per annum is more than I ever contributed to party funds when 1 was associated with the Labour party. I invite Senator McDougall or Senator Gardiner to be as frank in this matter as I have been, and tell us what he pays to thefunds of the Labour party. If they cannot, or if they will’ not, then I am on an independent footing compared with them, for whom somebody else has to pay.
I feel sure that the motion will receive the support of the Senate. I simply desire honorable senators to- record the opinion that the will of Parliament should not be subordinate ‘ to that of any Government. The Government may have had the best of intentions, but, as Sydney Smith has said, there is nothing more dangerous, not even a Bengal tiger going along a street crowded with children, than a stupid person of good intentions. I do not suggest that the Government is stupid, but I contend that, although it may have had good intentions, the net result of its action in this case has been to place an unnecessary burden on those people whose interests it should be the first duty of the Government to safeguard. I am a supporter of thisGovern ment, and I claim to be no less loyal to it by reason of my independent expression of opinion. I should not be a supporter of any Ministry if it meant forgoing my right to express my candid opinion on all occasions. Actions such as those of which I complain penalize the fearless and hardy pioneer. Ease the burden on him and your citieswill prosper. Overburdenhim and your cities . will stagnate and decay.
Debate (on motion by SenatorPearce) adjourned.
Motion (by SenatorPearce) pro posed -
That the. Senate do now adjourn.
– Referring to the debate on the previous motion, and the letter read by Senator Lynch, may I ask whether the National party is organizing for an election, and expects trouble next Monday? Seeing that Senator Lynch has been asked to’ contribute the sum of £30 to the funds of the National party, the suggestion is that the party is preparing for something. Has’ this letter any bearing, however remote it may be, upon the possible disruption of the Composite Government, owing to the National party refusing to agree to the Country party’s conditions?
– I hope that both Senator Gardiner and Senator McDougall will be as frank as I have bees.
Question resolved in the affirmative.
Senate adjourned at 9.37 p.m.
Cite as: Australia, Senate, Debates, 17 July 1924, viewed 22 October 2017, <http://historichansard.net/senate/1924/19240717_senate_9_107/>.