3rd Parliament · 2nd Session
Mr. Speaker took the chair at 10.30 a.m., and read prayers.
page 11701
Progress report presented by Sir John
Quick, and recommendations read by the Clerk as follows -
Your Committee beg to recommend Federal legislation providing -
.- The report just presented is confined to questions of procedure. As to past offences and recent allegations reflecting on Parliament, the Committee has taken preliminary action which will be followed up, the nature of which I am not now at liberty to disclose. Meanwhile I give notice of my intention to move that the report be taken into consideration onWednesday next.
– The consideration of this matter must be subject to the convenienceof the House, but I recognise the importance of getting a statement from the honorable and learned member, and am sure that honorable members desire an opportunity to carefully scrutinize the proposals of the Committee both before and after he delivers it. I move -
That the report be printed.
– It will contribute to the proper settlement of the question to hear the honorable and learned member for Bendigo as early as possible, and I think there should be an interval between the delivery of his explanation of the Committee’s proposals and their consideration by the House.
– The honorable and learned member for Bendigo is at liberty to give notice of his intention to move a motion on any day he may think fit.
– Will the motion have precedence on that day?
– Yes, as it affects questions of privilege. The honorable and learned member may plead privilege when rising to address the House.
.- I do not object to the printing of the report, but I shall object to giving to its consideration precedence of’ other business which I consider more urgent. If we were being asked, to deal with recommendations regarding the cases already mentioned in this Chamber–
– They are under investigation.
– I cannot, at this stage, allow the report to be discussed. Under the Standing Orders allquestions of privilege have precedence, which means (bat the honorable and learned member for Bendigo will have the right to move his motion on the day appointed, but it will be competent for another honorable member to move the adjournment of the debate on the conclusion of his speech.
.- I think that it would be convenient if the honorable and learned member for Bendigo made his statement before the general discussion, and if he is ready to do so now the House would like to hear him. The discussion of the report could then be adjourned until a convenient day next week.
– I have nothing to add to the report, which speaks for itself.
– Then no statement is necessary.
– Not at the present time.
Question resolved in the affirmative.
Report ordered to be printed.
page 11702
– After your ruling yesterday, Mr. Speaker, inregard to the reading of newspaper paragraphs, I am in a bit ofa quandary as to how I should proceed. It is necessary, for the purpose of a question which I wish to put to the Minister of Defence to read the following paragraph, which appears in to-day’s Argus, headed, “ Federation and defence. Disastrous disappointment “ -
Sydney, Thursday. - Lieut. -Colonel Onslow, addressing the Women’s Patriotic Club on Australian defence to-night, said that federation in respect to defence had been a disastrous disappointment. We had obtained an able soldier in Sir Edward Hutton, who, thwarted, baulked, and insulted by the Government, had returned - ti England in disgust. Since 1905 we had had a military board. The Deakin scheme was a disastrous folly. He did not believe that the best brains of Australia were connected with it. It was really conscription. Officers should be higher in the social scale than their men. The Swiss military system would not be at all suitable to Australia.
Does the Minister think it right for an officer commanding a large force of citizen soldiers to criticise the Government in that way ; and will he, if the report is correct, take steps to remove this officer from his command at once?
– : It must not be forgotten that he is a member of Parliament, and that the soldier members of this Parliament express themselves pretty freely on defence questions.
– He ought to be back selling rum.
– It is in violation of the Standing Orders for honorable members to interject in this way, and makes the orderly conduct of business impossible.
– I apologize.
– So do I.
– The fact that an officer is also a member of Parliament places on him a special responsibility. I do not know that any one will attach great value to the opinions which have been cited, though it must be acknowledged that the report is not a full one. The public have, on one side, the views of Lieut.-Colonel Onslow, and on the other, those of Lord Roberts, and can decide between them. The statement seems to imply that none except those of so-called high social standing should be given positions of trust in our defence forces; but if we were dependent on such persons, there would be no defence for Australia.
– Do not “ play it down.” It is very easy to talk like that.
– In arranging forthe defence of the country, we shall not “ play it down” to a shoddy aristocracy. It is the policy of the Government to promote its officers according to merit, irrespective of social position, and the views attributed to Lieut. -Colonel Onslow are in direct opposition to those of every member of the Cabinet.
– I wish to ask the Minister of Defence a question arising out of that put to him by the honorable member for Maranoa. Is he aware that comments such as are reported to have been made by the officer in question are against the regulations, and if he finds, on inquiry, that the report is correct, will he cause action to be taken?
– The fact that an officer is a member of a State Parliament does not entitle him to ignore discipline and regulations.
– I thought that the Government invited all officers to express their opinions freely.
– Not on a matter of this sort and in this manner.
– It would be unwise to come to a conclusion without first obtaining the fullest information. When that information is secured the honorable member may rest assured that the right thing, will be done.
page 11703
– Now that we are on friendly terms in regard to Defence matters, I should like to ask the Minister of Defence whether he will lay on the table of the House the papers in regard to the surrender of Captain Crouch - an incident that took place some years ago?
– I agree with the leader of the Opposition that it is not well to wander among political tombstones.
page 11703
– Will the Prime Minister afford the House an opportunity to pass this session the Seat of Government Bill?
– I should be very glad if the opportunity offered. I hope it will.
page 11703
– I desire to ask the Prime Minister whether he will announce in the House this session the determination of the Government regarding the granting of preference to British goods where tenders are called by departments for the supply of imported material ?
– I shall certainly make a statement this session, but, judging by the delay I have experienced, it is a matter of some difficulty to ascertain what is being done by the several departments in various parts of the Commonwealth. A certain measure of freedom is allowed in different parts.
– I am inclined to think that the Prime Minister is under a misapprehension as to the information I desire. I wish to obtain information, not as to the custom of the departments, but as to the determination of the Government. We have granted a preference to certain imports from Great Britain, and I wish to know the decision of the Ministry as to the preferential treatment of British goods in connexion with tenders for departmental supplies.
– The honorable member’s question is more restricted thanI thought it was, but I have been making inquiries as to the custom of the departments, believing that information so obtained will furnish material on which to arrive at a decision.
page 11703
– Can the Prime Minister state whether the valuation of transferred properties has yet been completed, and, if it has, will he inform the House of the total value at which they have been assessed?
– The valuation is nearly complete, and I expect that within a very short time it will be finally determined.
page 11703
– I wish to ask the Prime Minister whether, in view of the fact that the Tariff appears to have been finally disposed of by another place, the Government are in a position to state definitely when the present session will be brought to a close?
– I am not informed that the Tariff has been finally disposed of by another place. If it has been, I shall endeavour to make a statement next week.
– In view of the length of the present session, and the probability of our enjoying only a short recess, will the Prime Minister consider the advisableness of inviting the House to sit on Saturdays and Mondays, in order that the session may be brought to a close as soon as possible?
– We propose to ask the House to sit next week over Friday, and to meet on the following Monday, with a view to finishing the business that week.
page 11704
– Is the Prime Minister aware that the trade union laws of Australia are notoriously out of date, and, if so, will he consider the advisableness of introducing a Commonwealth Trade Union Bill ? ,
– I cannot at the moment say that we have the constitutional power to pass such a measure.
page 11704
– I desire to ask the Postmaster-General whether he is aware that a very large number of persons, who for business reasons, are compelled to take press copies of telegrams, find that the paper on which the telegraphic forms are printed is so flimsy as to render it impossible to do this. In view of the complaint, will he cause a supply of forms printed on better paper to be placed at the disposal of such persons.
– I have never heard a complaint.
– I shall have inquiries made.
page 11704
– Has the PostmasterGeneral read the leading article in yesterday’s issue of Comments, and, if so, considering the nature of the indictment which it makes against him, what action does he propose to take to vindicate his attitude in regard to the matter therein dealt with?
– I have read the article, but do not consider it of sufficient importance to justify any action on my part.
page 11704
– With reference to previous questions relating to the operation of a regulation providing for the reduction of accumulated holidays and leave of absence as a set-off against sick leave in Customs cases, and the fact that this rule is not in operation in other branches of the service, has the Minister of Trade and Customs considered the advisableness of withdrawing this order, thereby placing the officers of the Department on the same basis as officers in other branches of the service.
– Instructions have been given, and I shall be glad to give the honorable member their full text.
page 11704
– I very much regret that I have to call attention to a statement reported to have been made by the Treasurer, and to have to make a personal explanation in regard to it. Not content with the exercise of his rights and privileges as a member of this House, the Treasurer, as soon as we rose last night, made a statement to press representatives in regard to the reduction of departmental Estimates, and endeavoured to lay as much blame as he could upon my shoulders. In that statement, which is published in this morning’s newspapers, I have been misrepresented.’ In my own defence I find it is. necessary to say that the Estimates for this year were not finally settled by me before I retired from the Government.
– The Estimates in relation to the Post and Telegraph Department?
– The Estimates of every Department. I resigned office as Treasurer before they were finally settled. I had not decided finally on their limits, and had not consulted the Cabinet, and therefore the Estimates as introduced in this House were not what they would havebeen had I remained a member of the Ministry. At the time I resigned, as far as I can remember, it was not finally decided what amount the Prime Minister would require for Defence purposes. My colleagues did not seek interviews with me in regard to the Estimates of their respective Departments, but myinterviews with the leading officials were of the most amicable character. I heard on their part no expression of dissent from the way in which I dealt with the draft Estimates, as far as I had consulted them, and was not aware that they disapproved of any action taken by me. Atno time was any representation made to me by any of my colleagues as to departmental dissatisfaction with what I had done with their Estimates. So far as I was aware, the officers of the different Departments were satisfied. Yesterday the Minister showed me a departmental paper on which in my own handwriting appeared a statement indicating that I had reduced the Works and Buildings Estimates of the Post and Telegraph Department by £27,100. That fact had passed from my mind. The Department asked for £32,000 for the construction and extension of telegraph lines in New South Wales, and I reduced the amount to £30,000, a reduction of £2,000. As a matter of fact, only £14,000 had been spent in that direction during the previous year, and I thought that £30,000 would be sufficient. Then again, I reduced the Estimates for similar works in Victoria from £120,000 to £100,000. I considered that as the Department during the previous year had expended only £84,000 on such works, £100,000 would be probably as much as it could expend during the present financial year. The total reduction made by me was £27,100. Then he is reported to have said that I sent back the EstimatesinChief of the Department, reducing the amount asked for from £547,000 to £511,000. So far as my memory serves me, I was informed by Treasury officials that those particular draft Estimates were too large, and that if they were agreed to we should be unable to show a balance.
– But the right honorable member was responsible.
– I am not seeking to evade responsibility; I am only stating what actually took place. I am almost ashamed to refer to this matter; but, apparently, confidential notes of a Treasurer - confidential not as against the next Treasurer, but only so far asthe public are concerned - have been unearthed. The decision as to carrying out the suggestions in these notes rested, of course, with the Cabinet afterwards ; they were merely preliminary notes, not final, prepared in order to ascertain how much could be allowed for each Department. And because I used my own pen, instead of allowing some one else to do so, these confidential notes of mine of proposed amendments made by me several times in regard to the same Department, which had not even been submitted to the Cabinet, are now published by the Treasurer in order to shield himself and attempt to throw the blame on me. Personally, I think this a most unusual proceeding. Why should confidential Ministerial notes on such a thing as Estimates, made and altered several times probably, and never intended until the last moment to be final, be published with such a motive? The present Postmaster-General did not occupy that office while I was a member of the Government; and, therefore, he knew nothing of those Estimates, and had nothing to do with them.
– Will the right honorable member allow me? One is always disposed to permit the largest possible latitude in the way of personal explanation. If the right honorable member thinks he has been misunderstood, or misrepresented, he is entitled to make an explanation ; but, at the same time, I imagine he is going beyond legitimate bounds, and I ask him to bring his remarks to a conclusion as soon as possible.
– I am very sorry to have had to say what I have. I only desire to add. that these notes were confidential, and were not final, and for my own use or that of the Department only. I might have thrown them in the wastepaper basket if I liked, as they were merely scrap notes for final settlement; and it is most improper, in my opinion, for a future Treasurer to use them in order to shield himself at my expense. I regret very much having to make this personal explanation, in view of the fact that the honorable gentleman and myself worked together on terms of personal friendship as colleagues foryears.
– The right honorable member is now debating the question he proposes to ask.
– I only desire to add that the present Minister of Trade and Customs was Postmaster-General all the time I was Treasurer, and that I always tried to assist him to the utmost, never refusing, to the best of my belief, any request he made for moneys necessary for the administration of his Department. I desire now to ask that honorable gentleman a question whether, on any occasion when he was Postmaster-General, he ever made a request to me as Treasurer for money, for thepurposes of his Department, that I refused to comply with ?
– I may point out that when I became PostmasterGeneral, I was in an unfortunate position, inasmuch as the first Estimates I had to present had been practically prepared by my predecessor. On the second occasion when the- Estimates were prepared, 1 happened to be out of the country, and, consequently, I cannot rax my memory, or be expected to answer any question regarding them.
– What as to the third time?
– As to the third time, I. have no recollection of ever asking the right honorable gentleman as Treasurer for any money which he did not give me. Occasionally he might cavil at the amount asked for, but I generally managed to secure what I wanted at the finish; and therefore I cannot say that he ever refused any funds for which I made a request.
– I desire to make a personal explanation. The right honorable member . for Swan has charged me with . bringing confidential documents into this Chamber, and in reply I have to say that I have introduced no documents, but those of a public character. I did let the right honorable member see a document yesterday, to which his name was attached.
– Was not that in reference to ,£27,100?
– I do not desire to have any wrangle’ over the matter.
– Perhaps not; but the honorable gentleman chooses to go outside and make statements.
– I must ask, not only honorable members who are new to the House, but, more especially, those who have been leaders, and have had long political experience, to obey the Standing Orders. »
Sir John Forrest. - I express my regret at interjecting.
– What hap-‘ pened was that the right honorable, member left the office of Treasurer very suddenly.
– I deny that.
– When the right honorable member, did resign, he left Estimates which were’ ready for the printer’s hands.
– But they had not been before the Cabinet.
– I was compelled to take office when the right honorable gentleman resigned ; and I had to work night’ and day in order to have my Budget ready for presentation to the
House in the short time at my disposal.. The Estimates which had been prepared by the right honorable gentleman showed that the sum asked for by the Postal De,partment was £547,000.
– Why give Cabinet secretsaway ?
– These are not Cabinet secrets, but are set forth in public documents. The right honorable member for Swan, as Treasurer, very rightly sent the departmental Estimate back with a request that it be reduced. The Department reduced the* Estimate by £30,000, or thereabouts, and when it was returned to the Treasurer, he further reduced it by £77,100. In addition, he made furthersavings to the extent df £23,000. That was the condition of the Estimate when I received and accepted it.
– Surely the Treasurer- is not condemning the right honorable member for doing that?
– I am not; indeed, it is very likely I should have done the same myself. On the statement and request of the Secretary to the Department, I made a saving of .£25,000 more - nothing was done without the advice of the Department. As I said, it is quite DOSsible that I should have done as the right honorable member did.
– Is it fair that there should be these remarks?
– I am making a personal explanation on the attack’ levelled at me by the right honorable member for Swan. At that time, the estimated’ revenue left a very small . surplus over the whole year; and it is the duty of a Treasurer to see that he does not introduce Es’timates of expenditure which he cannot meet. That is what influenced the right honorable member, and I am not blaming him. I only take notice of the fact, because the leader of the Opposition last night attacked me for doing something which I did not do.
– I desire to ask the Prime Minister whether he will use his influence with his colleagues to prevent the dis- ‘ closure of their relations, either while they are still colleagues, or when any of them may have left the Government?
– I have never yet had any personal difference with past or present colleagues, arid I hope I “never shall ; but what does occur, and what has, un-“ happily, occurred, arises from misunder-standings in the heat of debate. I know’ as a fact that the two honorable’ members who now take different views, have always been the best of friends outside; and if they had, understood each other, there would never have been the necessity for these explanations.
– As the matter has gone so far, it is just as well that I should be quite satisfied about it. I have no recollection of the occurrences as stated by the Treasurer - I only know what he has shown me. Will the Treasurer be good’ enough to, let me see those papers, in company with the Secretary of the Department, so that I may be satisfied as to the
£77,100?
– I shall be very happy to let the honorable member have access to all information. The documents are public documents.
– The Treasurer in the course of his explanation informed us that on the resignation of the right honorable member for Swan, he was compelled to take office as Treasurer. I should like to know from him what pressure was exerted, and whether it was entirely of a political character ?
– My colleague’s statement is absolutely correct. I applied the pressure and insisted on him taking office.
page 11707
-Will the Post master-General lay on the table of the House a copy of the correspondence which has taken place relating to the negotiations with the Eastern Extension Telegraph Company in reference to the Tasmanian cable?
– I have no objection.
– I desire to ask the Postmaster- General whether he thinks it is a business-like procedure, which he seems to have adopted, of calling for tenders for the laying of the cable to Tasmania before the necessary money has been voted by the House? It seems to me that a vote-
– There must be no discussion on a question.
– I only desire to say that the usual plan is first to obtain supply, and then to call for tenders, and I desire to know whether the PostmasterGeneral intends to continue on all occasions the course he has adopted in this case?
– It certainly would not be a business-like procedure to wait until we were in the hands of the company, and compelled to accept any terms they offered. Tenders have been called in anticipation in order to save time, and the House will be asked to deal with the matter in some way before any tender is accepted.
page 11707
– I desire to ask the Prime Minister whether he will take into consideration the matter of amending the Standing Orders, so that, in the interests of public business, a certain time may be allotted to questions without notice at each day’s sitting ?
– I think the honorable member has anticipated a very general desire on the part of the House. I should have introduced the subject before, but, as we were so close to the end of the session, did not deem it desirable to do so. Some arrangement ought to be made by which notice of questions should be required.
page 11707
asked the Prime Minister,upon notice -
– I have not read the letters in question, and have no desire to. The only knowledge that I have obtained in this matter is from a telephone message received by my secretary this morning from Mr. Marshall Lyle, of Melbourne, who is referred to in the fourth question, repudiating, so far as he is concerned, the statements made. All I know of Dr. Arthur is that he is an extremely enthusiastic and able advocate of immigration. I do not read all his letters, and do not feel called upon to sit in judgment on them.
page 11708
asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s Questions are as follow -
page 11708
asked the Postmaster-General, upon notice -
– Inquiries are being made, and replies will be furnished as early as possible.
page 11708
asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s questions are as follow -
page 11708
– On the 27th inst, the honorable member for Cook asked two questions with reference to the tests to which letter carriers are subjected when; applying for promotion as sorters. In addition to the reply then given, the following further information has been fur- nished by the Deputy Postmaster-General, Sydney-
page 11709
Motion (by Mr. Dugald Thomson) agreed to -
That a return be laid upon the table of the House showing -
The cost to each State, in the year prior to Federation, of each of the services since transferred to the Commonwealth.
The revenue, if any, derived by each State from each of such services in the same year.
The present annual cost to each State ofeach of the services which are yet to be transferred to the Commonwealth.
The present annual revenue, if any, derived by each State from each of such services not yet transferred.
Where, in the accounts of a State, the income or expenditure of a transferred or transferable service has not been separated from that of other services, an approximate estimate to be furnished.
page 11709
Motion (by Mr. Johnson) agreed to -
That a return be laid upon the table of the House showing -
The revenue received from duties of Customs and Excise for each State annually since the passing of the first Commonwealth Tariff Act, including the amount received for the first quarter of the current year.
Total amount of salaries paid in each State in respect of the collection of duties for that State.
Total number of officers in each State employed by the Department, and how classified.
The number and classification of officers, and salaries paid to each, employed in Sydney, Melbourne, Brisbane, Adelaide, Fremantle, Hobart, and Launceston.
Salaries paid in connexion with the central administration common to the whole of the Commonwealth. Such salaries not to be included in the returns relating separately to each State.
page 11709
Debate resumed from 31st March (vide page 9875), on motion by Sir William Lyne -
That this Bill be now read a second time.
Upon which Mr. Joseph Cook had moved, by way of amendment -
That all the words after the word “That” be. left out, with a view to insert in lieu thereof the words - “the consideration of “this Bill be postponed until the financial relations of the Commonwealth and the States can be dealt with as a whole.”
.- In my opinion, this Bill is merely a machinery measure, for which the Constitution clearly provides, five years after the imposition of a uniform Tariff. In debating it upon a former occasion, the right honorable member for Swan, who said that he was curious to know my view of it, asked whether I was prepared to do justice to the States. My reply is that I am most desirous of doing justice to them, and I trust that the time will never come when I shall attempt to inflict injustice, either upon the States or the Commonwealth. When this measure was being discussed, about six weeks ago, the objection which was urged to it by the. honorable member for Parramatta and myself was that it should have been accompanied by a financial statement, or, as an alternative-, that it should not have been proceeded with until the Premiers in Conference had an opportunity of debating the financial relations of the Commonwealth to the States. But, during the course of the debate which has taken place, the Bill has been attacked, not only upon the ground that it was introduced at an inopportune time, but also upon its merits. Viewing it from the latter stand-point, I am heartily in accord with it. By passing’ this Bill we shall do no more than we ought reasonably to do if we intend to discharge the duties which have been delegated to us as a Commonwealth Parliament. I have no doubt that this Parliament has complete power to appropriate the whole of the 25 per cent, of the net Customs and Excise revenue specified in the Constitution.
– Nobody denies that. We can spend it too.
– I am glad to hear the honorable member admit that we have a
Tight, not only to appropriate the money, but to spend it, if the demands of the Commonwealth services require that to be done.
– But we have no surplus now.
– I am inclined to think that we have. But, if the honorable member’s contention be correct, he should be an ardent advocate of this Bill, so that every month the surplus might be credited to a trust fund to be operated for carrying on the services of the Commonwealth.
– But there is no surplus.
– The honorable member is not always accurate in his statements. I think that we shall have a surplus, and a very considerable one.
– The Treasurer says that he will have a surplus of £427,000 this year, but ,£350,000 of’ that amount is due to the States as interest, upon transferred properties.
– It needs’ a lot of explanation to buttress the honorable member’s original statement. From my point of view, there will be a substantial surplus. The right honorable member for Swan has asked, “ Shall we do justice to the States?” I say, “ Yes.” The verdict which has been given repeatedly at general elections is undoubtedly the concern of this Parliament. I have read the programme of the honorable member for Swan, and I know that he was an earnest advocate of a Federal system of old-age pensions.
– So I am now - just as strong as is the honorable member.
– This Bill, if carried, will enable a Federal scheme of old-age pensions to be initiated at. least eighteen months earlier than would have been possible bv any other means.
– But can Ave constitutionally do that which this Bill purports to do?
– The legal members upon both sides of the House declare that it is perfectly within our constitutional powers to pass this Bill.
– Who says so?
– The honorable member for Flinders, who is a K.C, has not the shadow of a doubt as to the constitutionality of the Bill. As a matter of fact, 110 lawyer has yet definitely stated that it exceeds our powers under the Constitution; But even if its constitutionality were in doubt, surely the question is ot sufficient importance to justify us in taking the step that it is proposed to take.
– Then the end justifies the means?
– I have never argued in that way. But we cannot shuffle upon this question. Like myself, the honorable member is thrice pledged to a scheme of Federal old-age pensions. Here is the means of initiating such a system, and yet he says that we ought not to avail ourselves of it. It will be within the recollection of honorable members that I recently submitted a motion affirming the urgent necessity for establishing such a scheme.
– And every honorable member backed up the honorable member.
– Exactly. The honorable member himself was so heartily in support of the motion, that he desired provision for such a scheme to be made immediately. At that time, I did not know by what means the desired result could best be accomplished.
– I wonder that the honorable member did not ‘ know how his purpose could be achieved if the- position, is now so clear.
– Whilst I was speakingupon that occasion, the deputy leader of the Opposition interjected - “ What is the honorable member talking about? He knows that .we cannot find the necessary means to provide for a system of oldagepensions. His talk is all moonshine.”’ My reply was that it was not my duty topoint out the means by which the desired result could be brought about. My motionmerely asked the House to affirm that the matter was urgent. Honorable membersunanimously did so.
– The honorable member has just discovered a means of gaining his end after looking at the matter all these years.
– The honorable member does not do himself justice in making such remarks.
– I must ask the House to permit the honorable member for Wide Bay to make his speech without interruptions. I notice that he has frequently to raise his voice to make himself heard above the hum of conversation which isi proceeding, even while I am speaking. I am amazed that honorable members should exhibit such an utter disregard of the Standing Orders, to which their attention has been so frequently called. I must also ask the honorable member for Swan not to make a running commentary upon the speech of the honorable member for Wide Bay, but to speak himself at a later stage if he desires to do so.
– The honorable member for Swan has asked why I did not tackle this question earlier. But I would point out that we had no power to deal with it in this way until five years after the adoption of a uniform Tariff. That period expired about the time that a general election was at hand. Later on Parliament went into recess, whilst the Prime Minister visited Great Britain ; and therefore we have not lost much time in dealing with it. We could not have tackled it very much earlier. Within ten days after the House had affirmed my motion that the establishment of a Federal system of old-age pensions was an urgent matter, I made a public statement, to the effect that I was in favour 01 this Bill, as under its provisions an amount could be’ appropriated and credited to a special trust fund, which would help to provide the Federal Treasurer with the necessary funds to commence paying old-age pensions from the 1st July, 1909.
– In any case, I suppose the honorable member’s policy is to make up for lost time?
– There has been returned to the States, from the inauguration of Federation until the 30th June, 1907, £5,728,114 more than the States’ threefourths. In no year have there been sufficient funds to pay Federal old-age pensions.
– - But the honorable member thinks that now that we have no surplus, we shall have sufficient funds?
– A parrot could repeat that cry. If we are to have no surplus, this measure will be without effect. If we expend the whole of our net quarter, and the profits from various services, it will be inoperative. But there should be, and, I think, will be, a considerable surplus. I expect that at least £1,000,000 will be accumulated before July, 1909.
– A great deal more than that, according to the estimate I have.
– My anticipation is that there will be then at least £1,000,000 accumulated in a trust fund, and available for the payment of old-age pensions. According to my calculation, an accumulation of about £I,250,000 would be more satisfactory. The question is, are honorable members .prepared, at this stage, to anticipate that accumulation by an appropriation? It is within the power of the Commonwealth to provide for other necessary expenditure as well as old-age pensions, under a trust fund, and it will be the duty of the Government to so provide for it if they think it necessary/ Will the Treasurer say what the increase of revenue has been under the new Tariff?
– About .£2,000,000.
– The people of the Commonwealth have this year paid into the Treasury £2,000,000 more than they paid in previous years, yet the honorable member for Parramatta says that we have no money.
– The money has been taken out of the pockets of the people, and should be put back again.
– The Labour Party has been accused by the Opposition of advocating a Commonwealth old-age pensions system merely as a placard. They have said, “ We are more desirous than you to establish a Commonwealth old-age pensions fund ; but we know that it cannot be done yet.” It would be a scandal if, now that we are taking from our citizens annually £2,000,000 more than they were forced to pay in previous years, we still said, “We believe in a Commonwealth old-age pensions system, but we cannot yet afford to establish a fund for that purpose.”
– It must not be forgotten that the larger States already have old-age pensions systems.
– Although honorable members say that we cannot yet establish a Commonwealth old-age pensions system, I say that we can under the Bill.
– In my opinion, illegally.
– If we go beyond our powers, the Bill will be invalid. The right honorable gentleman has himself stated that this is a question for legal men. The honorable member for Flinders, in a clear, lucid, and emphatic speech, said that there was not a shadow of doubt as to our right to exercise these powers, and the strongest adverse opinions I have heard from legal members have been the expression of a doubtful hesitation in regard to the matter. Three or four of the lawyers whom I have consulted say that they believe this legislation to be within our powers.
– Has the honorable member obtained deliberate opinions from lawyers, or is he speaking of mere casual observations ?
– The opinions were not paid for; but I think that. they were the result of deliberate consideration’. The people, from whom we have extorted ‘ so much money, should be able to look forward to the receipt of pensions should they in their old age desire them. Not only have the toiling masses to provide the great bulk of our revenue, but, as the Minister of Defence pointed out to-day, they have also to find the flesh and blood to defend the country. Therefore, this, is not a party issue; men of all shades of opinion should be delighted at the opportunity to use part of our one- fourth of the net revenue for old-age pensions on the ist of July, 1909. It is not necessary to discuss at length the principles of a Bill which are apparently generally accepted, though I should make a passing reference to the Conference of Premiers held since it was introduced. It was thought that an opportunity should be given to the Premiers to express their opinions on the subject before we finally dealt with the measure ; but we have not got as much help from their deliberations as was expected. I am pleased that the Conference resolved that, in its opinion, a’ Commonwealth old-age pensions scheme should be established at the earliest moment. But it made the establishment of such a scheme conditional, whereas we, in our promises to our constituents, have been unconditional.
– They tried to strike a bargain.
– I do not object to that ; but we, being pledged in this matter, dare not strike a bargain. If we did, we should be unworthy of our positions, and ought to give our constituents an opportunity to say whether they desire that we should continue in their service. There seems to be a hazy idea that, if the Commonwealth expends the whole of its net quarter of Customs and Excise revenue, some of the States will lose more than others. 1 deny that the expenditure will be disproportionate to any serious extent. Each State must pay its share of new expenditure according to population.
– That is so with regard to old-age pension payments.
– And with regard topay ments for other new services. I do not suppose that the Government require a measure of this kind for transferred services. They have a constitutional warrant for expending their share of the revenue upon such services. I do not think, however, that one State could be debited with such expenditure in another, though I donot dogmatize in this matter. New expenditure, however, will be charged per capita, an arrangement which is fair to all the States. The statement that the large States will provide nearly the whole of the necessary money is. erroneous. Each State will, for all purposes of calculation, practically be called upon only to furnish sums for the payment of old-age pensions to its own citizens, and should be proud to be in a position; to do so.
– While Queensland, New South Wales and Victoria wilt be relieved of their present expenditure.
– I shall deal with that later. If all the States had old-age pensions schemes and if they dealt with each other reciprocally they would still be unable to do what can be done under our legislation. . That is an additional reason for urgency. Should the States which now have old-age pension schemes in operation be financially embarrassed by this Bill, they will have the remedy in their own hands. It is open to them by. a State Act to empower the Federal Government to pay their old-age pensions out of the proportion of Customs and Excise revenue returnable to them, and as soon as they do that their embarrassment will cease. The Commonwealth will pay instead of the State. The States need not suffer a day longer than they please; but in the case of the States which have no old-age pension scheme in operation, it is absolutely necessary that we should act without delay. This measure simply means that if we pass this session an Old-age Pensions Bill, and make an appropriation for the specific purpose, there will be no legal obstacle in the way of our paying into a trust fund to help, meet’ the obligations which the Federal Treasurer may thereby have to meet in the early future.
– What is the estimated cost of a Federal system of old-age pensions ?
– I have estimated it at £1,500,000 for the first year.
– Including the£900,000 already being expended on old-age pensions by two States?
– Yes; and the States may relieve themselves of that burden whenever they please. The passing of a Federal scheme will certainly not mean the imposition of an additional burden on States which already have local schemes in operation. Since this Bill was last under discussion, I have received letters from every State which satisfy me that the people, and more particularly those in States which have no old-age pension schemes, are almost unanimous in the desire that a Federal system should be inaugurated without delay.
– The wonder is that the most radical States - Western Australia, Queensland, and South Australia - are those who most strongly resist the making of this sensible arrangement.
Colonel Foxton. - Queensland now has an old-age pensions scheme.
– It is only fair to say that the Queensland Parliament has passed an Old-age Pensions Act, which will come into operation on the 1st July next.
– I am glad to hear it.
– It will, therefore, be seen that Queensland, like New South Wales and Victoria, may by its own act relieve itself from any embarrassment. If the Governments of those States desire the Federation to take over the payment of old-age pensions, they need not be financially embarrassed. The other States must be prepared to meet this new expenditure. If the Customs and Excise revenue this year will be nearly£2,000,000 in excess of the amount received under the old Tariff, then old-age pensions should be a first charge upon that excess. I go so far as to say that we should not be doing more than our duty by appropriating money, and accumulating it in a fund for the purpose of meeting Federal obligations incurred by pur own Acts and due at a future date, subject to section 87 of the Constitution. We are undertaking duties of a national character which have hitherto been performed by some of the States, and’ 110 one can fairly accuse this Parliament of being extravagant. On the contrary, the charge has been made again and again that we have been too niggardly. In the early days of Federation some of the States found themselves in a position of difficulty owing to the severity of the drought, and -the return to them of surplus revenue in excess of their threefourths of our net revenue was considerate and becoming on the Commonwealth’s part. That return was made according to law, and the States were fully entitled to it. It may be that the amount returned to more than one of the States as the result of this special appropriation will be less than three-fourths of their Customs and Excise revenue.
– That will probably be the position of Western Australia.
– Probably that will be the experience of more than one State. But it will not be ah infringement of the principles of the Constitution.
– We want to deal fairly with them.
– Certainly we do. That is my aim, but in dealing fairly with the States I certainly hope we shall not deal unfairly with the people of the Commonwealth.
– Are we to deal fairly with the States Treasurers or with the people of the States?
– I cannot dissociate a State from the people of that State.
– The State means the people.
– Then why this eagerness to defend the States as distinguished from the people? The Constitution provides that the people of the States shall elect members of the Senate, and that the people of the’ Commonwealth shall elect the members of this House. It is difficult for any one who is not a lawyer to appreciate the difference between the terms “the people of the Commonwealth” and “the people of the States.” I recognise the distinction, but certainly do not appreciate the difference.
– It means the parts and the whole.
– Quite so, but the framers of the Constitution had something in their minds when they expressly declared that the people of the States should elect the members of the Senate, and that the people of the Commonwealth should elect the members of the House of Representatives.
– I suppose that the States Governments and Parliaments have to deal with the finances of the States on behalf of the States.
– Men are always willing to take up the arduous duties of office as soon as they are elected by the people. We must not forget that a member of Parliament can do nothing without the people. We have arduous duties to perform, but the people can always find plenty ready to shoulder the reponsibilities of political life. We can do nothing except by the verdict of the very people who constitute the States, and the point that I wish to impress upon honorable members is that those people have given a thrice repeated verdict which we must not set aside. The Prime Minister has in view in connexion with this measure the initiation of a system of defence of which as regards its naval side I entirely approve, and my views on which I have previously expressed in no uncertain manner. No one can deny that the members of the party with which I am associated have always been opposed to the Naval Agreement. When it was first put before us in 1903 by Sir Edmund Barton we did not approve of it; we did our best to defeat.it, and were nearly successful. At that time the people were opposed to the attitude we took up, but I believe that to-day three-fourths of the people of Australia are entirely in favour of it. I do not mean that we should inaugurate a system of coastal defence which should not be associated with the defence scheme of the Imperial authorities. Honorable members will agree that it would not be wise, or even reasonably sane, for us to talk about initiating a scheme of defence dissociated from Great Britain. But in a country which is wholly dependent upon another, we search in vain for that essential of manhood which makes a worthy people and a worthy nation. So soon as a nation leans upon another for support,its people as a people begin to decline. The many natural difficulties with which we have to contend have made the virility of our people what it is to-day ; and it would be a sad day for Australia, and those who are to govern her hereafter, if, whilst she is practically a nation, with a constitution under the Crown of Great Britain, her manhood were to shirk their responsibility of defending their country to the last man. The whole question at issue is simply one of method. I am one of those who believe that we should take our own responsibilities upon our own shoulders. I have always been in favour of coastal as opposed to field defence.
– Does the honorable member mean that we should defend all our trade, or only our coastal trade?
– I mean that we should begin, at the earliest possible moment, with the defence of our harbors and our seaboard generally.
– And let the Old Country do the rest?
– Somepeople seem to fear that if Australia had to stand alone in her own defence, she would speedily go to the wall. I hold that the people of the Commonwealth are just as capable of defending themselves as are those of any other country.
– Yes; but not of defending Australia.
– I go so far as to say that Australia could probably defend herself against any European nation. That may be regarded as an exaggeration.
Colonel Foxton. - That we could defend ourselves without the assistance of the British fleet?
– Yes. I would remind the honorable member of the experience of the Transvaal. Tens of thousands of troops were sent from Great Britain, and after the British had suffered three unfortunate defeats the London Times screamed like an hysterical individual for Mr. Chamberlain, then Secretary of State for the Colonies, to appeal to the Colonies for assistance.
– How many troops did we send?
– Hundreds of thousands of troops were necessary to conquer a country with a smaller population than Victoria.
– The Transvaal had no coast line to defend.
– I could, if necessary, refer the honorable member to the view expressed by quite a number of British Admirals, that no European power save Great Britain could afford to send a navy here.
– The honorable member is off the track.
– I have perhaps drifted away from the subject-matter of the Bill itself. Those who oppose the creation of a small fleet of our own, base their opposition on the assumption that, if we start defending ourselves in this way, Great Britain will desert us. Is it not a fact that some of the most shrewd advisers of His Majesty the King have stated, from time to time, that it would be of great assistance to tlie Imperial Government if we had naval depots and a small fleet to defend our own shores ? ls it not a fact that almost all authorities declare that all we require at present are ships capable of holding off any stray cruisers for two or three days until the Imperial Fleet shall arrive? I take this opportunity of saying that I have never supported the restriction of the present Australian Squadron of the British Fleet to Australian waters; because my belief is that, where trouble is, there the ships should go. First, we should- secure a system of old-age pensions at the earliest possible date; and I hope that a Bill will be introduced immediately and passed this session providing for their payment not later than the 1st July next year. The initiation of a system of defence for our coast and harbors should also be undertaken at the earliest moment, but I cannot anticipate that the money will be required for a very considerable time, lt is only fair, however, that Parliament, as an earnest, should give some indication of its intention; and, therefore, I hope that this Bill will pass after reasonable debate, seeing that it raises no party question, and should be dealt with in the true Federal spirit, in the interests of the people of Australia as a whole.
– I have listened with much attention to the honorable member for Wide Bay ; and I think that if I were to describe his speech as solely one iti favour of old-age pensions, I should not be inaccurate. The validity and legality of this measure does not trouble the honorable member. From his arguments one would almost infer that, in his opinion, practically the end justifies the means, whether or not those means are constitutional. I am altogether opposed to the Bill, and was. prepared to vote a direct negative. As, however, I cannot, under present circumstances, take such a course, I intend to support the amendment moved by the honorable member for Parramatta. In my opinion this Bill is not correctly named : it ought to be described rather as “a Bill to prevent the return to the States’ of about £700,000, which the Government do not know how to spend, or have not arranged to spend.” My contention is that the measure is an invasion of section 87 of the Constitution; that it is an attempt to perpetrate a grave breach of faith, and that it is a departure from a clear and honorable understanding, made with the States prior to Federation, at the Federal Convention of 1 898 - an understanding on which the States of Australia federated. Those words cover the whole of the contention which I shall advance, in opposition to the measure. Immigration, defence, old-age pensions, and other important or beneficent questions, have nothing whatever to do with my opposition to the Bill. The honorable member for Wide Bay placed prominently before us the great necessity and advisableness of adopting a scheme of oldage ^pensions at the earliest possible moment. 1 agree with the honorable member on that’ point; but I hold that it has nothing to do with the matter we are now discussing, and, therefore, I shall not touch upon it in the slightest way.
– This measure provides the only means I know.
– If the means could thus be provided constitutionally and honorably I should have no objection, but my contention is that this measure is unconstitutional, besides being a breach of faith.
– The right honorable member’s objections are on constitutional grounds ?
- Yes, and also on the further ground that the Bill represents a departure from a clear and honorable understanding made prior to Federation, and in support of this latter contention I intend to show what the framers of the Constitution said and meant when section 87 was passed. As the Attorney-General says, my contention is, in the first place, that the Bill is ultra vires, and, then, that if it is not ultra vires, it is an attempt to perpetrate a grave breach of faith with the States. I wish to say once and for all that there is no doubt that the Commonwealth, under section 87, can expend annually the whole of the one-fourth of the net revenue from Customs and Excise.
– The right honorable member admits that.
– Certainly ; if one can read plain English, it must be admitted. But the section does not say that the Commonwealth shall spend the whole of the one-fourth; indeed, it infers from the use of the words “not more than,” that the Commonwealth may not spend the whole of the one-fourth during the ten years’ operation, of the Braddon section.
– The word “ apply,” and not the word “spend” is used in the sect ion.
– I take those two words to have the same meaning.’I take the word “ applied “ to mean “ used or employed. ‘ ‘ The section does not provide that three-fourths, and three fourths only, of the net revenue shall be returned to the States, because, as I have already pointed out, it implies that more may be returned. I contend that if the Commonwealth does not spend the whole of the one-fourth, the unspent or unused portion must, under section 87, be returned to the States. That view has been acted on ever since the establishment of the Federation.
– What is provided for is the unapplied portion.
– But I submit that “unapplied” and “unused” have the same meaning.
– That is just the point to be argued.
– If a quibble as to whether the word “ applied “ means “ used “ or not is all that can be advanced, I do not see much force in the contention. At any rate, the view I have presented has been acted upon up to the present’ time ; and I have never heard anything to the contrary suggested. No suggestion to the contrary was made at the Convention in 1898, nor has any been made since, although nearly eighteen months have elapsed since the bookkeeping period could have teen terminated. No suggestion of the kind has been made by any Prime Minister, Treasurer, Leader of Labour Party, or, indeed, by any one in this Parliament, except a remark of the honorable member for Flinders, some months ago, who said he thought such an interpretation was possible. I do not know that the honorable member made ‘ that remark very deliberately. It was, I think, an opinion that the question was open to doubt.
– No; I expressed a contrary opinion to that of the right honorable member.
– I am referring to what the honorable member for Flinders said nearly a year ago. The honorable member, however, on 31st March last, rushed in, and took up the cudgels on behalf of the Government, and expressed a view which is adverse to my contentions and to the interests of the States ; and he has the credit, as well as the responsibility, of being the first to suggest such an invasion of States rights.
– There always has been a doubt on the point.
– The honorable member for Flinders was the first I ever heard suggest a doubt.
– The doubt has always been present.
– Then it must have been kept very close, because I had never heard it expressed by any one before. When I was busy endeavouring to adjust the financial problem between the Commonwealth and the States, I never heard any suggestion of the kind made. The Commonwealth may spend the whole of the one-fourth if it chooses, but, if it does not spend or use the whole of its one-fourth then, I think, it is clear that the balance must be returned to the States. Further, I contend that under section 87 of the Constitution, this House has no power to credit any unexpended portion of the Commonwealth’s one-fourth share of the net Customs and Excise revenue to a trust account, except for the purpose of paying a charge or debt actually incurred, or a liability actually existing.
– Suppose the Commonwealth enters into a contract?
– I will deal with that point directly. I desire to point out to the honorable member for Wide Bay that we have not merely to consider what is desirable in this matter. A great many things are desirable, which it is impossible for us to obtain. If we can, constitutionally, secure the necessary funds to initiate a Federal scheme of old-age pensions, without any breach of good faith with the States, I am quite in accord with most of what the honorable member said.
– I have consulted numerous lawyers upon the matter, and most of them are positive that this Bill is constitutional, while only a few entertain the shadow of a doubt about it.
– If we desire to expend the full one-fourth share of the Customs and Excise revenue, to which we are constitutionally entitled, we are at liberty to do so. Why have we not spent it? In this connexion I wish to defend the action taken by my old friend and colleague, Sir George Turner, in the early day of the Federa- tion. Recognising that- the States were then suffering under a great many difficulties, he naturally desired to return to them as much money as possible, so as to enable them to meet their obligations. At that period several of the States required liberal treatment financially by the Commonwealth. Queensland was suffering from- a terrible drought, and Tasmania was in difficulties by reason of the falling off of Customs revenue. Even a few thousand pounds were of consequence to Tasmania in those days, whilst Western Australia required every penny that she could get to assist in developing her immense territory. I think, therefore, that when Sir George Turner did his utmost to sustain the financial position of the States during the difficult time that they were passing through, his action commanded the approval of the people of Australia. In his speech on 31st March last, the honorable member for Flinders attached very great importance to section 81 . of the Constitution - so much importance, indeed, that he appeared to almost ignore the provision contained in section 87. He, apparently, forgot that section 81 is a general provision which is to be found in the constitutions of all British countries. It relates to the power of Parliament to appropriate money for the services of the country. It would be impossible to carry on a Constitution if Parliament had not power to appropriate revenue for the public service, subject, of course, to its constitutional powers. But I submit that the words in section 81 “to be appropriated for the purposes of the Commonwealth in the manner, and subject to the charges and liabilities imposed by this Constitution,” do not give us full power, for the power is limited by the provision contained in section 87. The honorable member for Flinders seemed to treat the power conferred under section 81, as if it were plenary, whereas I contend that it is limited by the words of section 87. . I submit that the language of section 81 is general in character, and must be read subject to the specific words of section 8y, “not more than one-fourth shall be applied annually by the Commonwealth’ towards its expenditure.” I take the word “applied” to mean used. The section continues -
The balance shall, in accordance with this Constitution, be paid to the several States, &c.
I believe that the words of this section mean that the Commonwealth is at liberty to expend not more than onefourth of the net Customs and Excise’ revenue, and that -the balance of threefourths - or more - shall be returned to the States. I come now to the words “ its expenditure” contained in section .87. I contend that those words mean actual expenditure. They would, I think, include money due on contracts to the extent of the work actually performed. 1 believe that they would also include repayments of actual debts and such like. . If we appropriated money to pay debts incurred by the Commonwealth or in connexion with contracts actually performed for the Commonwealth, it would be proper to charge it against the expenditure for the year, and it might be put aside if it had not actually been paid until the claims against it we’re presented.
Colonel Foxton. - Would the honorable member say that the money had been “ used “ in those circumstances?
– Yes. The work would have been done, and the money would be actually due.
– How could it lie said to have been used when it was actually in the Treasury ?
– The work would have been performed and the money would be actually due, and consequently I hold that it would have been “ used.” At one time the practice in Western Australia, and in other States also, was to keep the Treasury accounts open for some time after the end of the financial year, for any accounts which had ‘not been paid at the close of the year, to be paid and charged against the year to which they belonged.
– If they were not paid during the month following the close of the financial year the money had to be revoted.
– That would depend upon the Audit Act. If the accounts were passed by a certain date the money was paid and charged up to the year’s expenditure.
– But the money did not pass away from the State Treasury. ‘
– We have not to consider what is best for the Commonwealth or State Treasuries, but solely what is right from a constitutional point of view. The words “its expenditure” do not in my opinion include money set aside in a trust- account to meet prospective charges, prospective debts, and liabilities for works which have not been undertaken orwhich, perhaps, have not even been decided upon. Yet that is what this Bill purports to do. Out of our one-fourth of the Customs and Excise revenue it proposes to set aside money for the purpose of meeting prospective charges and debts and liabilities for works which may not have yet been thought of.
– They have been thought of.
– Under this Bill money might be appropriated for works which may not be undertaken for years. Parliament might say that it would undertake a certain work ten years hence and appropriate money for that purpose and charge it as an expenditure for this year, keeping it back from distribution among the States.
– Why not?.
– Because we are prevented from doing so by section 87 of the Constitution.
– What about the bounties which have been voted?
– As claims for the bounties are made annually they will be paid annually. The money will not be held in reserve to be paid some years hence.
– But it has already been appropriated.
– My contention is that appropriation is merely the authority to expend money, but that expenditure is an Executive act based on that authority. The meaning of the two words is therefore quite distinct. Evidently the honorable member thinks that I do not know the difference between the words “ appropriation “ and “expenditure.”
– But sometimes we may be allowed to think that the honorable member is wrong.
– How is the right honorable member going to pay for the transcontinental railway?
– I see no great prospect of paying for it from current revenue, and as this great work is necessary and urgent, I should pay for it out of loan funds, just as all the railways in Australia have been paid for, as well as nearly all the other great public works in New South Wales. I repeat that the words “its expenditure” refer to bona fide and existing liabilities and not to prospective, visionary liabilities. That is my deliberate belief. It seems strange that I should have to defend the interests of the States against the views of the honorable member for Flinders, who sits alongside me. For some reason or other he has been anxious to take the credit for this thing, when, as a matter of fact, it will do him a lot of harm.
– I have never said that I desire to take credit for it.
– The honorable member said on 31st March last that “he had anticipated that there would have been some little acknowledgment for the suggestion,” by the Government. I am really sorry that he should be open to the charge of endeavouring to deprive the States of what I consider is their just due. The honorable member for Flinders dealt with annual appropriations for the payment of sinking funds in regard to loans. My opinion is that it is within the power of the Commonwealth to pay out of its one-fourth of the Customs and Excise revenue annual payments to such funds.
– Then the honorable member gives away the whole position.
– I do not think so. If an Appropriation Act authorizes the payment annually of a sum for the repayment of a debt which has been incurred, it can surely be paid out of the one-fourth of the Customs and Excise revenue. But until 1910 this Parliament is not sovereign in regard to expenditure. Its powers of expenditure in regard to Customs and Excise revenue are limited by section 87 of the Constitution.
– What about the Post Office revenue ?
– I am not concerned with that now - it does not affect the question, viz., the validity of the Surplus Revenue Bill now before us.
– The right honorable member wishes to further restrict the powers of this Parliament.
– I certainly do not. I have no such desire or intention. I merely desire that we shall keep within our bounds. I do not wish to take from the powers of the Commonwealth ; but I am equally opposed to the Commonwealth taking from the powers of the States. Under section 87 of the Constitution, the Commonwealth is not, in my opinion, empowered to set apart, out of its one-fourth of the Customs and Excise revenue, money to be placed to trust funds, to be expended hereafter. As I was a member of the Convention which framed the Constitution,
I may fairly take credit for some knowledge of its intentions. I am astonished that the Prime Minister, who was also one of the framers of the Constitution, should lend his name and reputation to a Bill of this kind. The Treasurer, too, was a member of the Convention. The honorable member for Wide Bay is continually saying, “ Let us be honest, and act as honest men.” That is what I want his party to do on this occasion.
– The right honorable member accused me of using any means to an end.
– The honorable member’s argument amounted to this : that we should “ try it on ; that if it does not come off we shall be put right, and no harm will be done.”
– I say that, even if there is doubt about our powers, we should proceed to exercise them in this case.
– I do not agree with the honorable member. Especially in legislation affecting the States, we should make certain that we are acting within our constitutional limits. I will read, for the purpose of proving my contention That the Bill, even if not ultra vires, is a grave breach of faith with the States, quotations from the speeches of some of the most prominent members of the Convention. Their opinions ought surely to have some weight as to what was the intention of the framers of. the Constitution. The late Sir Edward Braddon, on the nth March, 1898, in moving the insertion in the draft Constitution of what is now section 87, providing for the return to the States of three-fourths or more of the Customs and Excise revenue - I refer honorable members to the official report of the Melbourne session, page 2378 - said -
The balance of such net revenue remaining after the application of the sums actually applied …. shall be distributed among the States.
The word “ applied “ means, in my opinion, “used.” .The Treasurer was also a member of the Convention. At the time he was sitting in Opposition in the New South Wales Legislative Assembly, and, perhaps, little thought that he would ever become a Commonwealth Minister. He said - page 2426 -
I have, on every occasion when I have referred to it, advocated that there should be some definite return to the States provided for. I hailed, with very great pleasure, Sir Edward Braddon’s amendment when he brought it in. It is simple and effective, and will coincide entirely with what I have advocated upon this question. I also think that, as regards the small States, as well as possibly the ‘larger ones also, this is one of those clauses which will help very materially to recommend the Bill. If we give up this £6,000,000 of revenue, and the States have no power of raising revenue through the Customs, and no guarantee from the Federal Treasurer that they will get a return, there is only one alternative, and that is imposing excessive direct taxation to fill up the gap ; and that would prevent a great many persons from voting for the Bill.
What a “ falling off “ there is now ! He did not then appear to be so much in favour of direct taxation. . As a matter of fact, he opposed the acceptance of the draft Constitution, by the people of New South Wales, being afraid of the powers conferred on the Commonwealth. Sir Edward. Braddon said further, page 2429 -
No more than a certain proportion of the net Customs and Excise revenue should be applied to the purposes of the Commonwealth, while the balance, which might be greater than threefourths of the Customs revenue, would be available for distribution amongst the States in proportion to their contribution.
– What does that mean?
– What I have said it means. He continued - page 2456-
For the Commonwealth expenditure there would be set aside a sum not exceeding onefourth of the Customs net revenue, . leaving the balance, whatever it may be - a balance certainly, of three-fourths, and possibly at first of more than three-fourths - to be distributed amongst the States.
I now ask the House to listen to what Mr. Speaker, who was also a prominent member of the Convention, said on the subject. After saying that the draft provision to which I have referred might be held to mean, that only three-fourths of the net Customs and Excise revenue would be annually returned to the States, he added -page 2457-
What I want to provide is that the whole of the unexpended balance shall be paid over to the States. For that reason I should like the Drafting Committee, to adhere to the original wording of the clause, which was : - The balance of such net revenue remaining, after the application of the sums actually applied, viz., three-fourths, or more than three-fourths, shall be distributed among the States.
This is the very point that is being put forward in this Bill - and it appears that it has not, in the opinion of some persons, been made so clear that they cannot override it.
– That wording was rejected.
– The Convention was ‘‘satisfied that the words used covered that meaning. Sir Edmund Barton, the leader of the Convention, and the chief member of the Drafting Committee, in explaining what the meaning of the words used were, said - page 2457 -
What we intend the amendment to mean is that the whole of the unexpended balance of the Commonwealth shall be paid over to the States.
With that assurance all the members of the Convention were satisfied, and agreed to the provision.
– Sir Edmund Barton also used the words “ shall be appropriated.”
– There is nothing about appropriation being considered as expenditure, or providing that the unexpended balance of the one-fourth may be placed to a trust fund for future use and not returned to the States. There is nothing in that to suggest that an unexpended balance under section 87 would be regarded as an expenditure, on the ground that it had been appropriated, or, in other words, had been authorized to be expended, but had not been expended. Sir Edmund Barton said that the whole of the unexpended balance would be annually paid over to the States. In summing up the work of the Convention of 1897-8, at page 2471 of the official report of the debates at Melbourne, Sir Edmund Barton said -
I will pass on to a much more important provision very lately introduced into the Bill. That is a provision that a fourth only of the net revenue of the Commonwealth will be allowed to be expended by the Commonwealth. That is to say three-fourths or more of the revenue must annually come back to States whose citizens are taxed.
All this goes to show that, from the beginning to the end, the intention of the Convention was that under the Braddon section the Commonwealth should annually return to the States any unexpended balance remaining after liabilities actually in existence had been met. There is no ambiguity in these words. The honorable member for Wide Bay has reminded us that this is not a party question, and I appeal to honorable members, again quoting the honorable member, “ as honest men,” to say what is the plain, clear, unmistakable meaning of these words. It would seem that, with some honorable members, the endjustifies the means.
Mr.J. H. Catts. - The leader of the Labour Party did not say so.
– He did not actually use those words, but I think that that inference might be drawn from his observations. After reading these words, uttered by prominent members of the framers of the Constitution at the Convention of which the Prime Minister and the Treasurer were members, I appeal to honorable members not to support this proposal on the part of the Government. Is it likely that, but for the proposal of the Government to take advantage of this measure to assist in bringing into operation a scheme of old-age pensions, we should have found the Labour Party, consisting of twenty-six members, prepared to support this Bill, irrespective of the interests of the States ? I am just as strong a supporter of old-age pensions as is any member of the Labour Party, and but for my vote and the votes of members from Western Australia who supported me, the power to deal with old-age pensions would not have been in the Constitution ; but I urge that the fact that it is proposed to finance a Federal system under this Bill cannot override constitutional considerations, or the honorable understanding made with the States before Federation. That a majority in this House appears to be opposed to the views I have urged, and seem to. me to be willing to do what I consider is a grave injustice to the States, will not cause me to waver in my determination to perform what I believe to be my duty, a duty that I owe to my own State and to the people of Australia generally. I owe, too, a duty to the Constitution which I took part in framing, and I am not going to subscribe, without the strongest protest, to an interpretation of that Constitution which, I am sure, the Convention did not intend to be placed upon it, and which I do not think is legal.
– In quoting the speech made by Sir Edmund Barton, the honorable member omitted a few words which, so to speak, “ upset his applecart.”
– I do not think that statement can be accurate, but, if I have said or quoted anything that can be controverted, the honorable membermay do it.
– He drew a distinction between appropriated moneys and expended moneys.
– Then the honorable member would have me believe, which I am not prepared to do, that on two different occasions Sir Edmund Barton expressed conflicting views. I have endeavoured to place before the House all those portions of his speeches which appear to me to have a bearing on this question. I am surprised at the attitude of the Government and of the Labour Party, which is always boasting of its desire to do justice. Where are the defenders and protectors of the rights of the States on the Government side of the House? One would imagine from the attitude of honorable members on the Government side of the House, and especially in the Labour corner, that they had not been returned by the people of the States of Australia; that they were here, not to represent the States who have sent them here to look after their constitutional rights and interests, but that these matters were of secondary importance to the passing of some warlike or beneficent measure.
– For which the people ask.
– The Labour Party seem to think more of such measures than of the constitutional rights and interests of the States which send them here to protect and represent them.
– We are looking after the whole of the people of Australia.
– Are honorable members having any regard for the people of the States in voting for this Bill ?
– Are not the people of the States identical with the people of the Commonwealth ?
– I have not said that they are not. The Labour Party, in this House more particularly, seem to ignore or forget the promise to, and the honorable understanding made with, the people of the States during the Federal campaign. They seem, also, willing to overlook in this case the provisions of the Constitution for the protection of the revenue of the States, and, apparently, are never better pleased than when they are able to do something which will place the Treasurers of the States in financial difficulties.
– The right honorable member is merely making a whip for himself.
– Honorable members of the Labour Party seem to forget the great duties and obligations resting upon the Parliaments of the States. They have responsibilities which affect as closely, if not more so, the material welfare of this country than do those of the Commonwealth Parliament. The nurturing and education of the future men and women of Australia is intrusted to them. The opening up of the country by means of railways, roads, bridges, and water supply schemes, and also the immense work of subduing the wilderness and making the land available for occupation and settlement rests with’ them. They are intrusted with the maintenance of law. and order, and with promoting and assisting production from the soil all over this great continent. Remembering all these great duties and obligations, we ought surely to have some sympathy with them in the gigantic work they have intrusted to them.. But we find on the Government side of this House very little sympathy for the States, if we may judge by this and other measures. The Treasurer seems to have no regard for the obligations resting upon the States, and the demands made upon their revenue. His sole desire seems to be to try to please honorable members of the Labour Party. He will never please them ; he will never satisfy them until he signs their pledge, and joins their ranks. I wish that he would do so, for he is, to all intents and purposes, a member of that party. He is returned by the Labour Party, and kept in office by them.
– We kept the. right honorable member in office for five years.
– That is not so from my point of view.
– We did. The honorable member is most ungrateful.
– I do not feel that I owe the honorable member anything, and have no desire to be in his debt.
– Order. The honorable member is entirely out of order.
– The honorable member for West Sydney is offensive.
-I ask the honorable member for West Sydney not to interject so frequently.
– And so offensively.
– Order. I did not hear the honorable member for West Sydney make an offensive interjection. Had I done so, 1 should have called upon him to withdraw it. At the same time, I would remind the right honorable member for Swan that he sometimes interjects when other honorable members are speaking, and that, therefore, he should make some allowance for interjections by others.
– I think, Mr. Speaker, that the honorable member provoked the interjections by his unwarranted aspersions upon a number of members of the party with which I am associated.
– What does the honorable member desire to speak upon?
– I withdraw everything.
– So do I. The obligations and duties devolving upon the States are so great that it is difficult for them to make ends meet. They could, with advantage to Australia, spend millions more than they have at their command. Even if our revenue this year will be .£2,000,000 in excess of that of last year, I fail to see why we should take from the States £500,000 of that total, unless we have expended it. The people of the States are clamouring for new services to open up the country and settle people on the land, and I utterly fail to understand why this Bill should have been introduced at the present stage. Surely the Government might keep faith with the States until 1910, and until then, at all events, return to them any unexpended balance of the one-fourth under section 87 at the end of each year, as in my opinion is the legal as well as moral interpretation of section 87. Apart altogether from any question of law, I do not think that it can be denied that this proposal is utterly wrong, and that it will be considered by the States to be a grave breach of faith. We have great power in regard to expenditure and taxation, and’, if we wish to finance any scheme designed to benefit the people, we can surely find some way of doing so without trying to drive a coach-and-four through the Constitution for the purpose of depleting the revenues of the States. The course that we are asked to take cannot, I think, be justified. Even if it is legal, it is inexpedient, and reflects discredit upon its advocates. It is wrong that we should even try at this stage to take away from the States, who have not sufficient to provide for their present requirements, a large sum to which they are entitled. In Western Australia we have to build railways out of loan moneys, the revenue being insufficient to meet such demands. There are hundreds of miles of railways awaiting construction, and money has. to be borrowed for that work. I am not here to mince words, neither do I wish to be discourteous to any honorable member, but, as I have said before, the power of the Labour caucus is so strong that its wishes must be complied with, even if it interferes with compliance on the part of honorable members -with the interests of their constituents. If it were not an iron.bound organization, should we find every member of it in agreement with respect to. such a measure as this ? They do not seem to care for the Constitution. They have in view the providing of funds for a scheme which members on this side of the House are ready to help them to secure if they will take a proper course, and every other consideration has to be ignored.
– I rise to a point .of order. Is the right honorable member in order in saying that no member of the Labour Party takes any heed of the Constitution, and that there is an agreement between members of the Labour Party, which overrides their allegiance to the Constitution, and the oath which they have taken as members of this House?
– If the right honorable member for Swan spoke of any honorable member of this House as being false to his oath, he certainly must withdraw the remark. I did not hear him make such a remark. If I had, I should have called upon him to withdraw it without waiting for a point of order to be raised.
– I in no way referred, pr intended to refer, to the oath taken by honorable members, which has nothing to do with their action in this case. I was referring only to the organization r>s a whole, and did not intend my remarks to be personal to any member of this House.
Sitting suspended from 1 to 2.15 -p.m.
page 11722
Bill returned from the Senate with the following message -
The Senate ^returns to the House of Representatives the Bill intituled “ A Bill for an Act relating to Duties of Customs,” and acquaints the House of Representatives that the Senate does not further press Requests No. 40 (as to part), 62, 74 (as to part), 75, 86, 88 (as to part), 91 (as to part), 92 (as to part), 94> 95, “i (as to part), 11S, 141, 154, and 162 (as to part), with which the House of Representatives has not complied, and has agreed to the modifications of the House of Representatives in regard to Requests Nos. 34, 37, 46, 90, 91, 93- r3°, >45> and 229.
The Senate has agreed to the Bill returned herewith as amended by the House of Representatives at the request of the Senate.
page 11722
Bill returned from the Senate with the following message -
The Senate returns to the House pf Representatives the Bill for “ An Act relating to Duties of Excise,” and acquaints the House that the Senate has agreed to the Bill as amended by the House at the request of the Senate.
page 11723
Debate resumed -
– When the House adjourned for lunch, I had almost arrived at the end of what I desire to say, but, before I sit down, I should like to recapitulate in a few words my contentions. I contend that, under section 87 of the Constitution, this House has no power to place any unspent or unused portion of its one-fourth of the revenue to a trust account, except for the purpose of paying a charge or debt actually incurred, or a liability actually existing. I contend also that the words “ its expenditure ‘ ‘ in section 87 mean actual expenditure, and might, I think, include money due on contracts to the extent of work actually performed, and also the repayment of actual debts and such like. But I have contended - and I contend now - that the words “its expenditure” do not include moneys set aside in a trust account to meet, prospective charges, prospective debts, or prospective liabilities for works not vet incurred, or not yet decided upon. In fact, my contention is that the words “its expenditure” mean bond fide and existing, and not prospective ox visionary liabilities which” may never come forward for payment. I contend also that, apart from the constitutionality of the measure, it is an attempt to perpetrate a grave breach of faith, and is a departure from a clear and honorable understanding made before Federation with the States. In the course of this debate it has been said in so many words that if this Bill is illegal, it cannot do any harm, because it may be set aside by the High Court. That, I think, is a most vicious principle - if I may use so hard a word - to introduce, especially into legislation which affects the States so vitally and so directly. I regret that this sort of idea should have entered the minds of honorable members. Surely that is not the spirit in which > during these early days of Federation, and during the continuance of the Braddon section, we should enter on legislation which affects the States. Why should the Government’ desire, or even think of, introducing legislation which I have no doubt they will admit, is, on the face of it, of - doubtful validity ?
– No.
– The Treasurer says, “ No “ ; but T think that there are laymen quite as capable as himself, and a great many lawyers, who could be found to say that there is a great deal of doubt as to the validity of this measure. I suppose that later on we may be addressed by some legal members, and we shall then see whether there is or is not any doubt in their minds as to its validity. I think few will venture to say that there is no doubt whatever.
– No one can state more than his own opinion.
– But there are some things so evident that we may almost stake our existence on them. At any rate, I do not think the honorable member for Flinders will say there is no element of doubt as to the interpretation which may be placed on this Bill by the High Court. My point is that it must be admitted that there is an element of doubt in this matter - though I have no doubt myself - and if that is so, then especially when we are dealing with friendly States, composed of our own people, we should not try to strain our powers to the uttermost. For a long time I have had strong complaint to make in regard to this straining of the Federal powers. The desire of the Government seems to me to strain them so much that there are often questions raised before the High Court as to the validity of our Acts.
– The right honorable member will admit that, so far, only one Act has been declared invalid.
– But the other Acts were “ pretty close to the wind,” and if the Government have been fortunate in most of the cases, there has ever been an element of doubt. Personally, I have been in accord with some of the Acts called in question; but I certainly am not in favour of the Bill before us, and of some other measures which the Government have tried to pass. “ I commiserate the Government a little, because I will not assume that they very much relish the course they have pursued. Unfortunately the state of parties in this House has forced the Government to introduce these Bills, or go out of office.
– That is not the issue.
– But it is, I regret to say, a fairly accurate statement. I am sure that the members of the Government expect honorable members to take an independent course, and say what they think, of course, as politely as possible.
– Catts. - The honorable member would like to be back amongst the “ flesh pots.”
– I have no such desire. I would not be under the thumb of the honorable member and his party again on any terms ; the honorable member may take my word for that. The honorable member may be content to do as he is told, and be kicked about from pillar to post by outside bodies and unions, but I am not.
– It suited the honorable member very well when he was in the Government.
– Yes, I have no fault to find with the personal treatment I received from the honorable member who interjects, and indeed from the majority of honorable members who sit with him.
– They did not treat the right honorable member badly, and I see no reason why he should not come back again.
– I appreciate the honorable member’s kindly feeling towards me, as shown by that observation. In conclusion, I ask again why we should strain the Constitution to its utmost limits when the result must be to injure the States. I appeal to the Government to think of the great obligations and duties which are cast on the States in the opening up and development of the country, the placing of people on the land, and in promoting the general production and progress of this great continent, and if there is to be any straining of the Constitution, to let it be in the direction of helping the States. I have tried to do only what I consider to be my duty in upholding what I know, from my own personal knowledge, was the intention of the framers of the Constitution. I am firmly of the opinion that this Bill is contrary to the Constitution, and is, moreover, a grave breach of that honorable understanding which was arrived at between the States and the Commonwealth’ at the Melbourne Convention of 1898, prior to Federation.
– No one will complain of the right honorable member for Swan for exercising his independent judgment in accordance with what he believes to be his duty as a member of this Parliament, and as one who had something to do with the passing of the Constitution.
Although I concede that much, I must admit to a feeling of deep regret that the right honorable member should even suggest that this Bill is in any way a breach of faith or a violation of the spirit of the Constitution. The feeling of the House all through has been to pay the greatest regard to the rights and duties of the States ; in fact, a great deal of our trouble has arisen from a sincere desire on the part of the Treasurer and honorable members to iri.no wise embarrass the States in the early stages of Federation. We’ realized that during the early life of the Constitution there were certain limitations which were intended as a direction to this Parliament ; and during the first five-year period, when we were realizing what our finances were, and what the effect of Federation might be on the States, it was felt that we should stay our hands and “ go slow.” Possibly we have erred in going too slowly, and’ in failing to realize that the people of Australia created the Commonwealth Parliament as a national Parliament, and vested it with national powers, to be exercised for their good. The general attitude of this Parliament has been, and still is, one of sympathy with the States. Another impression that the honorable member left upon the minds of his hearers was that the Commonwealth and States are entirely separate entities, apart from the people. I think that the electors’ view of the matter will be : “We have established two sets of agents - Federal and State. We have given them separate powers, the first set to act for us in Federal matters, and the second to act for us in State matters.
– I have never disputed that.
– But the right honorable member talked about the Commonwealth and the States as if the Commonwealth were something external to the people, when, as a matter of fact, both are one and the same people. His argument practically is that we should hand over to the States all the money that we can, and thus cripple the Commonwealth. To do so means that we shall be obliged to levy heavy imposts upon the people if we intend to fulfil our national functions. In all our financial proposals with the States we should so arrange our affairs that neither will be obliged to impose unnecessary burdens on the taxpayers. What we want to realize is that both the Commonwealth and the States derive their authority from the same persons. The honorable member put his position very clearly, and, from that standpoint, he is to be congratulated. He contended, first, that this Bill is unconstitutional; secondly, that it is contrary to the spirit of the Constitution-
– Contrary’ to the honorable understanding which was. arrived at.
– He also urges that to depart from that honorable understanding would be tantamount to a breach of faith. I will deal with his points seriatim. His claim that the Bill .is unconstitutional is based upon -his contention that it violates section 87 of the Constitution. He urges that the meaning of that section is that the money which the Commonwealth does not actually expend in one year, or which is not set aside to meet an existing debt or liability, or to cover payments in connexion with contracts to the extent to which they have , been fulfilled, must be returned to the States. The section in question reads -
During a period of ten years after the establishment of the -Commonwealth and thereafter until the Parliament otherwise provides, of the net revenue of the Commonwealth from duties of Customs and of Excise not more than onefourth shall be applied annually by the Commonwealth towards its expenditure.
– There might be only a small part of it required.
– The Commonwealth is, therefore, entitled to apply “ towards “ its expenditure one-fourth of the net revenue from Customs and Excise duties.
– Has not that section to be read in conjunction with another?
– I shall deal with that point presently. The section does not read “shall not expend,” but in effect “shall not apply.” What is the meaning of the word “ apply,” when used in connexion with financial sections?
– It means “ used,” I think.
– No. Section 81 of the Constitution deals with general appropriations. It reads -
AH revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund to be ‘ appropriated for the purposes of the Commonwealth in the manner and subject to the, charges and liabilities imposed by this Constitution,
– That ‘ provision is contained in every Constitution.
– It contains no limitation .as to the power of appropriation. It does not even say that am appropriation shall be for the specific objects set out in section 51 of the Constitution. In- connexion with a similar section contained in the United States Constitution., Story summarized the. arguments in. favour of the wider interpretation, as follows : The argument in favour of the power is derived, in the first place, from the language of the clause conferring the power, secondly from the nature of the power which renders it in the highest degree expedient, if not indispensable, for the due operations of thenational government ; thirdly from the early, constant and decided maintenance of it by the Government and its functionaries, as well as by many of the ablest statesmen of the United States from the very commencement of the Constitution. Section 81 of our Constitution must, therefore, be interpreted in the widest possible way. It must necessarily be so interpreted when it is remembered that we have to deal with national institutions, and that without revenue we cannot discharge our national functions.’ The Commonwealth has been endowed with great powers t and the power of appropriation must be proportionate to the other powers conferred upon it. The right honorable member for Swan . contends that the power of appropriation is limited by section 87, which he argues provides that all money not actually expended by the Commonwealth during the financial year must be returned to the’ States. He bases his argument upon the use of the word “ apply.” But I would point out . that that word, is always used in connexion with appropriations, and that it really means “ appropriated for the purposes of the Commonwealth.” It is now an ordinary practice in the High Court in interpreting the Constitution to contend that we must look at Statutes enacted by the Imperial Parliament, with the view to giving to similar words in our ownConstitution a similar meaning. Now if we look at Act 63 and 64 Vic, we shall find that it reads : “ An Act to- apply a sum out of the Consolidated Revenue “-
– The word “ used” means the same thing as “apply.”
– No. It has a very different meaning. The Act reads : “ An Act to apply a sum out of the Consolidated Revenue Fund to the service of the year ending on the. thirty-first day of
March, one thousand nine hundred^, and to appropriate the Supplies,” &c. That is the way the Imperial Parliament uses the word “ apply.”
Sir- John Forrest. - What does the Attorney-General say that it means?
– It means “ set aside for the purposes of the Commonwealth ‘ ‘ - as was pointed out in the Convention by the late Sir Edward Braddon.
– Does the dictionary give that meaning?-
– To ascertain the meaning of words, we mav look to Statutes. The first Act passed by. this Parliament was “ An Act to grant and apply ‘ ‘ a certain sum out of the Consolidated Revenue. Consequently the words ot section 87 mean that not more than one-fourth of the revenue from Customs and Excise duties shall.be applied and appropriated annually towards the services of the Commonwealth. Otherwise why is the word “ towards “ used in that section? If the word “applied” means “used “ as the honorable member contends, the section would read : ‘ ‘ Not more than one-fourth shall be used annually bv the Commonwealth towards its expenditure.”
– Appropriation does not mean expenditure.
– Section 87 allows the Commonwealth to appropriate or set aside “ towards “ its expenditure one-fourth of the net revenue derived each year from Customs and Excise duties.
– Whether we expend it or not?
– Yes.
– That is. the whole point at issue.
– The Constitution adds-
The balance shall, in accordance with this Constitution, be paid to the several States, or applied towards the payment of interest on debts of the several States’ taken over by the Commonwealth.
The honorable member places implicit reliance upon the wording of that section. But I submit that his contention cannot be maintained in view of what I have already said. His next point is that we must look at the spirit of the agreement made between the several States. In this connexion, he has quoted the opinions of members of the Federal Convention. But in every one of those utterances, I would, 1 point out that the word “apply “ is used, and in moving an amendment to this very provision, which was finally adopted, the late Sir Edward Braddon, who seemed to thoroughly understand the meaning of the word, said -
It would be preferable that, for the Commonwealth expenditure, there should be set aside not exceeding one-fourth of the Customs’ net revenue, leaving the balance, whatever it might be - a balance certainly of three-fourths, and possibly, at first, of more than three-fourths - to be distributed amongst the States.
– From what page of the ‘Federal Convention debates is the Attorney-General quoting ?
– From page 2456. 1 would, point out that it is not safe to rely upon isolated passages from speeches in the Convention for an interpretation of the Constitution. Then Sir Edmund Barton, on page 2457, is reported to have said -
If my honorable friend will refer back,, he will see that not more than one-fourth shall be appropriated by_ the Commonwealth. ‘
He used the word “appropriated” there in a’ technical sense,1 so that what he meant was that any unappropriated balance should be returnable to the .States. The right honorable member for Swan quoted’ Sir Edmund Barton as saying -
What we intend the amendment to mean is that the whole of the unexpended balance of the Commonwealth shall be paid over to the States.
But, later on, Sir Edmund Barton explained what he meant by unexpended balance. Let me read the whole passage -
– What I want to provide is that the whole of the unexpended balance shall be paid over to the States. For th: t reason I should like the Drafting Committee to adhere to the original wording of the clause. ,
– What we intend the amendment to mean is that the whole of the unexpended balance of the Commonwealth shall be paid over to the States.
– I understand it to mean the balance of the revenue collected, less onefourth.
– If my honorable friend will refer back he will see that not more than onefourth shall be appropriated by the Commonwealth. If less than one-fourth is appropriated, the unexpended balance, which may be more than three-fourths, will go back to the States.
The whole context must be considered in arriving at an opinion.
– That passage supports my argument.
– Every honorable member must form his own conclusions; but 1 think that the reasonable construction is that not more than one-fourth shall be appropriated, and that the word “applied” means “ set aside.” You appropriate to meet expenditure.
– Expenditure follows appropriation.
– Yes.
– Prospective or immediate.
– Yes. What is lawful expenditure depends on section 81. The Constitution provides for three financial periods, the first being that created by section 89, to last until the imposition of uniform duties of Customs and Excise. Section 93 creates a second period, to last for at least fiveyears after the imposition of uniform duties, the. section continuing, with certain modifications, the provisions of section 89. The third period is created by section 94, which says -
After five years from the imposition of uniform duties of Customs, the Parliament may provide, on such basis as it deems fair, for the monthly payment to the several States of all surplus revenue of the Commonwealth.
– That provision was framed at a time when the Braddon provision was perpetual.
-I am dealing with the Constitution as it is. The Braddon provision says that the balance shall be paid in accordance with the Constitution, which must be read as a whole, to arrive at its meaning.
– The Government has already established trust funds. Was that constitutional or unconstitutional ?
– I hold that what has been done can be justified. The technical system of bookkeeping provided for’ in connexion with the first and second financial periods, continues until the Parliament otherwise provides, which we propose to do now. The object of the Bill is to legislate under section 94, and to supersede the provisions of section 93, leaving Parliament free to deal with surpluses.
– We cannot interfere with section 87.
– What is being done is subject tothe provisions of section 87. Sections 89 and 93 appropriate balances to the States; and although the Bill repeals section 93, the balances remaining over and above the Commonwealth requirements will still be so appropriated ; but by virtue of this Bill, it may be contended that the word “expenditure” as used in section 93, has arestricted meaning,
But if it be construed strictly to mean the actual expenditure and payment of money, the Constitution would be unworkable, because it is impossible to make up actual balances every month all over Australia, and pay them to the States. . Therefore, it is obvious thatthe word has a wider meaning. In my opinion, it is intended to cover debts or obligations due, or to become due. Had the Commonwealth taken over the debts of the States, with a liability for interest of £8,250,000 a year, it would have had the power to retain the money necessary to meet the obligation out of general revenue. Whether the word “ expenditure ‘ ‘ can be applied to general appropriation for the purposes of the Commonwealth is questioned, and this Bill will remove that doubt. “ Surplus “ is distinct from “ balance,” and means moneys in hand over and above the sums appropriated for the purposes of the Commonwealth. Under the Constitution we have clearly the power to pass this Bill, and it is necessary to pass it to enable us to carry on the great work intrusted to us. The Constitution having endowed us with national powers, they carry with them the right to appropriate moneys, without which such endowment would be futile.
– Except for part of the speech of the right honorable member for Swan, the argument, so far, has centred round the constitutionality of this measure. I admit at once that that is very difficult to decide, and that laymen do not get much light, either from the provisions of the Constitution, or from the opinions of those learned in the law, who seem to take opposite sides. Therefore, I-and, no doubt, many other lay members - must hold that the constitutionality of the measure is uncertain, and that the Government and law officers of the Crown must take responsibility for recommending it to Parliament.
– We recognise the seriousness of this responsibility.
-I am sure of that. It would do no credit to the Government, or to Parliament, if our measures were to be held unconstitutional by the High Court. Coming to the Bill itself, the first question which arises is as to its necessity.
– That is absolute.
-The Minister has not said so. Parliament has. already sanctioned the establishment ot trust? funds, such as it is proposed to establish under the Bill, and has- allowed money to be placed to their credit.
– To meet debts . coming due.
– Not in every case. They have been established for a variety of purposes - to provide small-arms ammunition, to pay Customs officers overtime, to obtain defence clothing material, and for many other purposes.
– Are they suspense ac= counts ?
– They are trust funds. Some of “those in the list which I have here are such as the constitutional question raised has nothing to do with; the officers’ guarantee fund, for example. But other of those trust funds were established so that it should not be necessary to pay to the States at the “end of the financial year the sums placed to their credit, and if their establishment is constitutional, there is no need for the Bill.
– The Bill is necessary to do away with the effect of the bookkeeping sections.
– The Government is not doing away with the bookkeeping system. It the trust funds already established are constitutional, we can establish more, and. absorb any portion of the revenue that we choose to allot to them. If they are constitutional there is no need to pass this Bill; but if they are not the passing of this Bill will not make them constitutional.
-r-We are dealing with future trust funds, and if the- honorable member’s contention is correct’, that some existing trust funds are not constitutional, surely we are justified in taking steps to make future ones legal.
– The passing of a Bill such as this might make them legal, but not constitutional.
– Does the honorable member say that we can establish trust funds without an Act of Parliament?
– We can establish trust funds under the Commonwealth Audit Act. The Attorney-General said that the right honorable member for Swan, and others, did not seem to recognise that the electors were represented bytwo agencies - the one a national, and the other a State agency. He seemed . to imply that the electors of the States, being identical with those of the Commonwealth, would be prepared to trust the national agency just as freely as they would trust a State agency in this matter.
– That is hardly a correct statement of what I said, but I did say that although there was a tendency on the part of some to regard the Commonwealth as something external, as a matter of “fact, the people had two agencies.
– The AttorneyGeneral did not furnish a reply to the right honorable member’s contentions. The right honorable member showed that there were two agencies in respect of the one set of individuals, but that those individuals had deliberately placed a limitation, so far as matters of this kind are concerned, upon one of those agencies. The whole difference of opinion is in regard to whether that restriction is what the right honorable member for Swan says if is, or is as described by the AttorneyGeneral. .
– I was referring rather to that part of the right honorable member’s speech in which he pointed out the great duties cast upon the States in. respect ofthe development of their territory.
– THOMSON.- The right honorable member certainly was. not overlooking the dual representation of the electors.
– Does the honorable member distinguish between a trust fund £jid the appropriation of money?
-There is no necessity to distinguish between the two. All money paid into trust funds other than those of a domestic character - such, for instance, as a trust fund established in connexion, with- guarantee payments by public servants - must, first- of all, be appropriated.
– There must be an Appropriation Bill?
– Exactly ; there must be an Appropriation Bill such as we pass every year.
– Does not this Bill come within that category ?
– I do not think so. It is really a Bill to legalize a further appropriation for future purposes. There has been much dispute .as to the exact meaning of the words “ used “ and “applied. ‘ ‘ Judging by the Treasurer’s forecast, it seems to me that we shall have to take into account the meaning, not merely of these words, but of the word “ take.” lt would seem from the Treasurer’s statement of his intentions that it is a case, not of using or even of applying money, but of taking money.
– He said distinctly that it was to provide for specific purposes under the Constitution.
– The Treasurer said that, in the future, the Government would require all surplus revenue, and meant to have it.
– Only for the specific purposes of the Commonwealth under the Constitution.
– I desired an assurance’ in that regard, for the power given by the Bill is a very wide one. I do not object to the establishment of a Federal scheme of old-age pensions. On the contrary, I have always approved of old-age pensions being under the control of the Commonwealth. I supported the system as a State undertaking in preFederation days, and with the establishment of the Commonwealth I considered that such a scheme should be taken over by the Federal authority. But if the Ministry pass an Old-age Pensions Bill, it will annually absorb far more than any surplus Customs revenue we are likely to have. That is another reason why this Bill seems to me to be unnecessary.
– Is it not necessary to provide for an accumulation?
– The Minister now takes power to accumulate, or to hold oyer, for the purposes of the Commonwealth, considerable sums in a trust account. Then it has been claimed that this Bill will only absorb the actual surplus, and as regards that surplus it is said that we have been returning to the States every year, on an average, £800,000 in excess of the proportion of revenue to which they are actually entitled. We have not teen doing anything of the sort. A considerable portion of that amount, Tanging from £350,000 to £400,000 or £450,000, really represents interest on the value of the transferred properties which we have not yet paid to the States. They certainly have not lost anything in that regard, because the surplus moneys which we have returned to them have been far in excess of the interest actually due in respect of those properties. But we have no right to take credit to ourselves for having returned to the States, on the average, £800,000 a year in excess of what we were required to do, when, in reality, we have handed back to them only about one-half of that amount. The other day, the Treasurer, when foreshadowing the requirements of the Commonwealth, indicated that, even during this year of boom revenue, he anticipated a surplus of only £400,000 odd. He did not make it clear whether or not we should have that surplus after appropriating £250,000 for naval defence purposes. In that case, we should have a surplus of only £200,000 ; and, in the other, a surplus of something over £400,000* In reality, we shall’ have little or no surplus. As the Prime Minister told us to-day, the valuation of the transferred properties is practically complete, and immediately it has been settled, interest upon them will become payable by us. We become the trustees, though not the owners, of the properties ; and we have to provide the interest out of our onefourth of the revenue, thus absorbing the surplus of this boom year. The Minister foreshadowed that, in the immediate future, he did not anticipate so large a revenue, and that he expected still larger demands, apart altogether from old-age pensions. I really do not know whatre.sult is to be attained, at any rate this year, by” means of this Bill. It would have been much better not to have introduced this measure, but to have brought down an Old-age Pensions Bill, which would, in itself, absorb all the surplus, and more. Of course that might necessitate a financial arrangement with two or three of th* States, who would be asked to give an equivalent contribution in consideration of their being eased of the obligation to pay pensions. In any case, however, all” th<; surplus would be more than absorbed bv old-age pensions; and I see no necessity whatever for measures of the sort now before us. Such a Bill has not been found necessary hitherto. We are supposed to be intending to take only a portion of the surplus, and when’ we ask where the surplus is, we find that it does not exist. The Treasurer will admit that the . payment of interest, which will shortly begin on the transferred properties, will practically absorb all that is anticipated as surplus. Another matter of regret is that in this measure the system of bookkeeping is continued. This is most unfortunate, in view of the fact that one of the strongest reasons for Federation was that it would get rid of the obstacles and difficulties in the way of trade between the various States. The desire was to have free borders and free coasts as between State and State, so that, among other things, the trouble and expense of passing complicated entries for goods might be done away with, and a free exchange substituted, such ss there ought to be in what is one country.
– The honorable member must admit that any change would cause dislocation to some extent.
– We have o n 1 v to make an arrangement in accordance with our experience since Federation. What was the bookkeeping period provided for ? One of the objects of Federation was to make the well-to-do States assist the less well-to-do States; but it was found that a burden might be placed on the weaker States unless there was a guide as to the duties paid on goods actually consumed in each State. Thereupon the clumsy, awkward, but, I must admit, for the time necessary, system of Inter-State bookkeeping was established. Now, however, we are at the end of the five years, and, with the experience gained, we know what would be a fair’ adjustment between the States. As a matter of fact, there has already been an adjustment between New South ‘Wales and Victoria, and, that being so, it ought to be possible for the Commonwealth to devise a scheme fair to all the other States. Yet, here it is proposed to continue the present troublesome and inaccurate system.
– It is not so much a matter for the big States as for the smaller States of Tasmania and Queensland.
– But it is known what the effect has been in those States under the bookkeeping, system.
– Had there been no bookkeeping section, Queensland would have been a very heavy loser”.
– Then it would appear that the present system must go on for ever.
– I quite agree with the honorable member as to the undesirableness of the system.
– As a matter of fact, the present system is more troublesome and difficult than the preFederation system of collecting duties, inasmuch as now an analysis has to be made of, say, a coat ; it has to be ascertained whence the buttons, the thread, and the cloth have come. Indeed, the system is only made possible by evasion - to use an Irishism, it is only possible. because it is. not observed. It is impossible for me to believe that the firms who handle these goods make the complete analyses which are called for under the bookkeeping section ; and the work can be done only in such a rough manner” as to make it quite inaccurate. I feel sure that a settlement could be come to which would pav every consideration to the smaller States, and thus there would be removed a system which is a blot on our Federation. I did hope that when Ministers were dealing with the question, they would abolish the bookkeeping; but, on the contrary, we find it deliberately continued by means of this measure. There are no issues at stake that could not be easily met, and it is most desirable that we should, in every respect, feel that we are one people. It ought to be possible to send goods from Melbourne to Perth or elsewhere, with just as much ease as from Melbourne to Warrnambool.
– The conditions are worse in the retail trade.
– No doubt the honorable member could give illustrations of the difficulty and the absurdity of the system which, though useful for its immediate purpose, was never intended’ to be continued. I have not attempted to” say whether the Bill is constitutional or not, simply because I do not know. Reading one portion of the Constitution would lead me to believe that it is constitutional, while another portion of the Constitution leads me to a contrary view ; and, in my opinion, only the High Court can settle the question. If our application of moneys to trust funds in the past was constitutional, then the Bill is not required; and, on the otherhand, if it was unconstitutional, the passing of this Bill will not alter the situation.
– I listened with interest to the speech of the right honorable member for Swan, who seemed very impatient because honorable members did not agree with all he had to say. The right honorable member, in taking the view that the Bill is unconstitutional, said that he felt a burden of responsibility resting upon him, owing to the fact that he was a member of_the Federal Convention. I suppose that for a. period after the inauguration of Federation there was a good deal of responsibility on those who had been members of the Con- vention j but that responsibility, . I think, ended when Parliament appointed a High Court to interpret the Constitution. Under the circumstances, the right honorable member for Swan has no more responsibility in this connexion than has any other honorable member, and a great deal of his eloquence, and the resentment he showed towards honorable members who ventured to interject, was meaningless. If the Bill is ultra vires the High Court will say so,” and to me the question seems one of policy rather than one of constitutionality. Much of the legislation to which the right honorable member was a party has been reversed, and, so far as we have a forecast, the High Court will be against another Act > which- the right honorable ‘ member assisted in passing. The passing of this and similar Bills will make it so much less possible for the States to carry on the services which they have at present under their control, and, in this way, the object of Federation will be accomplished, inasmuch as the Commonwealth will be asked to take over these services. The States will then have less to do, be less important and less arrogant, and more easy to live with than is the case at present. There is what is called a fight for States rights, but in reality these are not rights. The States have certain functions to perform, and, if we withhold money, their remedy is to ask that the services be taken ‘over by the Commonwealth. The Treasurer estimates that the revenue derived from Customs and Excise this year will exceed that of last year by £2, 000.000. Should his estimate prove correct, the Commonwealth will thus receive £500,000 more than it received last year. But that sum will prove altogether insufficient to enable the Government to give effect to the policy, foreshadowed by them, even if they were able to credit the whole of it to a trust account. But I contend that .any moneys credited . to such a . fund ought tn be regarded as a set off to the amount due to the States as interest upon the transferred properties. I presume that a certain rate will be allowed upon their capital value. If the Government pay the States interest upon the transferred properties, no money will be left in the trust account. Of course, it mav be urged that no harm will result from the passing of this Bill. The honorable member for Wide Bay devoted most of his speech t” emphasizing the desirableness of establishing a Federal system of - old-age pensions. May I point out that such a system cannot be in augurated consequent upon the passing of this Bill, except in the very distant future. A sum of £1,500,000 is required to cover the cost of a Federal scheme of old-age pensions, and long before that amount has been accumulated, other demands ‘ will have been made’ upon the trust fund - demands which must be met promptly. There are’ Acts upon our statute-book which will make heavy demands upon the’ money which it is proposed to credit to that fund. For instance, there is the cost that will be incurred in ‘ giving effect to the defence scheme of the Government, and the outlay that will be involved in the construction of the. proposed Kalgoorlie to Port Augusta railway. We have also to bear in mind that the projected line will probably not pay, and the Commonwealth will have to make up Hie deficiency. Recent returns show that the mines of Western Australia are upon the down grade, and that the quality of the ore is deteriorating with depth. Interest upon the capital cost of the railway will also be a charge upon the Commonwealth. Then we shall have to face the loss that will be incurred in administering the affairs of the Northern Territory, and the payment of interest upon its public debt. . All these schemes will be a charge upon the trust fund which it is proposed to create, to say nothing of the bounties, the payment of which has been authorized bv Parliament. Consequently, if the Labour Party expect that we shall be able to annex the whole, of the additional .£500,000 to which I have referred, as the nucleus of a Federal oldage pensions fund, . they will be disappointed.
– Shall we not have sufficient ‘ money with which to start such a fund?
– Not sufficient to begin the payment of pensions.
– We shall wait until we have accumulated sufficient funds for the purpose before we initiate that scheme.
– But all the charges which I have outlined will fall due before sufficient, funds have been accumulated for that purpose, and the money will have been disbursed..
– In addition to which the Treasurer will be receiving a less revenue.
– So that the Labour Party will be defeated in their object. It is impossible to inaugurate such a scheme by passing this Bill. The
Labour Party is being hoodwinked in this connexion, and nobody recognises that better than do the Prime Minister and Treasurer. The honorable member for Parramatta has submitted an amendment in favour of postponing the consideration of the Bill until the financial relations of the Commonwealth and the States can be dealt with as a whole. I do not think that his proposal provides a satisfactory solution of the problem. When we take over the States debts, the States will have to provide for contributions of interest to the Commonwealth in order to satisfy demands.
– My amendment said nothing about the States debts.
– But it refers to the financial relations of the Commonwealth to the States.
– Yes.
– Possibly the honorable member had in his mind the matter of payment for the transferred properties. Whilst I do not feel disposed to oppose the amendment, I should prefer to see the Bill rejected. I do not think it is expedient to establish the trust fund that is proposed. If we do so, the States will probably test its validity in the High Court, and in any case, we are merely meeting trouble half way. If we want to initiate a special scheme of old-age pensions, let us impose direct taxation for that purpose. Certainly, we cannot provide the necessary money by passing this Bill. The Attorney-General has spoken upon the question of the constitutionality of this Bill. To my mind, it is” a matter of little consequence whether he is right or wrong in his contention, inasmuch as the measure will be inoperative for the old-age pension scheme. And, moreover, if the Bill is constitutional, the Constitution Act al ready gives the powers that are asked for in this measure. If we place it upon the statute-book, its constitutionality will probably be challenged by the States which will resent the creation of a trust fund. The only justification for the creation of any such fund would be an intention to relieve the States of some of the services which they at present administer. In the end, I believe that the finances will adjust themselves.
.- I do not propose, at this hour of the day, to occupy much time in discussing the measure. The case for both sides has been strongly and fairly put. The right hon orable member for Swan raised the point that the Bill is unconstitutional, while the Attorney-General has contended for its constitutionality. Although the right honorable member for Swan said that he did not speak as a lawyer, he argued with considerable skill and ability, evidently understanding his subject thoroughly, because he was able to handle it as well as a great lawyer could have done. Undoubtedly in this he was assisted by his long experience as a Minister of the Crown, in the State of Western Australia and in the Commonwealth. For five or six years he helped to administer the sections of the Constitution with which he dealt, and, no doubt, understands their inner, as well as their apparent, significance. But for the views in opposition to his put forward by some of my legal friends, I should entertain no doubt as to the soundness of his contention. Indeed, I think that, so far, he has had the better of the argument. He has created so much doubt as tojustify the belief that the question will never be settled except by the High Court. Bur the right of the States or of the Commonwealth cannot be prejudiced whether the Bill is passed or not, because both are secured by the Constitution. The measure cannot be considered as one to interpret the Constitution ; it is rather declaratory. Paragraph d of clause 4 provides that -
All payments to Trust Accounts, established under the Audit Acts 1901-1906, of moneys appropriated by law for any purpose of theCommonwealth shall be deemed to be expenditure.
The question arises whether a saving or setting aside of money - the placing of it to a trust account - is an expenditure. We are asked to declare that it is. I support the view put forward by the right honorable member for Swan, that under section 87 of the Constitution the Commonwealth can apply only one-fourth of Customs and Excise annually towards its expenditure. Does “ applied annually “ mean “ used “ or “spent annually?” After hearing the arguments which have been put forward, I think that it does. Money not used or spent annually must be returned to the States. There is a manifest distinction in the Constitution between “applying” revenue or money and “ appropriating “ it. Section 81 provides for appropriating the revenue of the Commonwealth, that being the first section in which the word is used. Section 82 enacts that -
The costs, charges, and expenses incident to the collection, management, and receipt of the
Consolidated Revenue Fund shall form the first charge thereon ; and the revenue of the Commonwealth shall, in the first instance, be applied to the payment of the expenditure of the Commonwealth.
The terms .” appropriating “ and .” applying” are not synonymous, but have different meanings, and should receive different significations. Section 87 says that not more than one-fourth of the Customs and Excise revenue shall be applied annually by the Commonwealth towards its expenditure, and, although it is dangerous to dogmatize on constitutional questions, my view is that what is meant is “ used annually “ or “ spent annually.” Money that is not used or spent within the year must be paid to the States. That was the intention of the framers of the Constitution. Passages have been quoted from the reports of the debates of the Convention, which show that it was understood that the whole of the unexpended balances would be returned to the States, and that interpretation has been placed on the Constitution from the beginning. It has been the practice of the Treasury to return to the States all unexpended balances, and I see no reason why that practice should be altered ; indeed, I think that it cannot be legally altered, and that the declaration that payments to a trust fund shall be deemed expenditure will be null and void. It is a contradiction of terms to say that appropriations shall be expenditure. The word “ applied “ occurs for the second time in the Constitution in the second paragraph, of section 87. In that connexion it undoubtedly means paid. “ Applied towards the payment of interest “ means paid towards the interest –spent in the payment of the interest. It does not ‘ mean “appropriated,” be-, cause there is a previous- appropriation. Personally, but for this obstacle in the Constitution, I should be quite willing’ t’o vote for the Bill. As a matter of convenience, it would be a most desirable thing to do, if we had the power to save the unexpended balance, and- pay it’ into a Trust Account - to hoard it up for big Federal enterprises. But I have to consider what are the rights of the States as well as of the Commonwealth. I am not prepared in any way to abridge “the undoubted constitutional and legal rights of the States. I do not believe that the States will tamely acquiesce in any invasion of those rights. If they do acquiesce in this Bill, it will stand. If they “ do not, they can bring an action against the Federal Treasurer to recover the unexpended balance.
– Is that desirable?
– It is not desirable to promote .litigation between the Commonwealth and the States. It would Be disastrous t’o take any attitude that appears to be fighting the States, invading’ theirrights, of encroaching upon their privileges. We ought rather, if possible, it. cultivate friendly relations with the States Governments, which are part of the machinery of the government of the Commonwealth, just as much as we are. They form a part of the King’s Government of Australia, and there is no occasion for contest or conflict between them and the Commonwealth Government. So far as concerns the intention of this Bill to facilitate great Federal enterprises, such as old-age pei> sions and naval defence, I am as anxious to promote and assist those objects as is any other honorable member, but I am not prepared to violate the fundamental principles of the Constitution, even for the sake of promoting popular measures. If this Bill is invalid, it may mean a little delay, but in eighteen months or two years the Braddon section will cease to operate, and arrangements may be made for entering upon those great’ national enterprises in the meantime. It will take a couple of years before we can expect to develop” a scheme of naval defence that will involveactual expenditure, and in the same wayit may take eighteen months or two years before Federal machinery for the payment of old-age pensions throughout Australia becomes effective and operative. By that time the Braddon section would have ceased to operate. There are other matters in connexion with this proposal which I would criticise, but as the time for adjourning has now arrived, I shall reserve my further remarks for the Committee stage, if it is reached. In the meantime, I hope it will be understood that no one who has criticised this Bill is adverse or hostile to its ultimate objective, but that the objections raised by the right honorable member for Swan and those who agree with him are founded upon legal, technical, and constitutional principles ‘that we feel bound to assert. From that point of view, I think the House will pause before it launches upon an enterprise which will undoubtedly bring the Commonwealth into conflict with the States, may lead to prolonged litigation, » and will tend to create further irritation and ill-feeling between the two important branches of the King’s Government in Australia.
Debate (on motion by Mr. Atkinson) adjourned.
page 11734
The following Bills were returned from the Senate without amendment or request -
Additional Appropriation (Works and Buildings) Bill 1007-8.
Additional Appropriation Bill, 1905-6 and 1906-7.
Additional . Appropriation (Works and Buildings) Bill, 1905-6 and igo6-7.
page 11734
Motion (by Mr. Deakin) proposed -
That the House, at its rising, adjourn’ until Monday next at 3 o’clock.
– It is proposed to proceed with the Surplus Revenue Bill.
– And nothing else?
– If there should be any necessity, which I hope there will not, we shall go on with the Parliamentary Papers Bill.
Question resolved iri the affirmative.
page 11734
Motion (by Mr. Deakin) proposed -
That the House do now adjourn.
.- I wish to draw the attention of the Prime Minister to an important and urgent telegram that I have just received from the Premier of Western Australia, to the following effect -
Federal Treasurer issued instructions not pay any moneys over to State. ‘ I have wired Prime Minister as follows : - “ Permanent Head Commonwealth Sub-Treasury has notified Treasurer that he has received instructions not to pay. any balance to State for month of May, or any later period till further notice. Such action calculated seriously embarrass States finances, and am advised contrary Constitution. Shall be glad know under what power and for what purpose Federal Treasurer has taken such arbitrary action. Last month we received seventy-seven thousand odd pounds, and it is necessary May surplus should be paid at once to include in to-morrow’s balance. Please issue immediate instructions to pay and wire me immediately.” Will you please take immediate action in House ascertaining whether instructions are general to all States, and wire result.
– The honorable member should not be frivolous on an important matter of this kind. I regret to say that honorable members in that corner do not seem to take any interest in the States that they come from, or for any other. I submit that the action taken by the Federal Treasurer is absolutely flouting the Constitution. It is arbitrary and illegal. The Constitution provides that -
The Commonwealth shall pay to each State month by month the balance (if any) in favour of the State.
What law has been passed altering that? The’ Surplus Revenue Bill is not yet law, and yet action has been taken to flout the Constitution as if that Bill had been approved by Parliament, and assented to. The action of the Treasurer is one of the most arbitrary and ill-advised that could possibly be taken, and I hope that the Prime Minister has sent a reply to the Premier of Western Australia, stating that whatever instructions have been issued are contrary to the plain words of the Constitution, and that the ordinary practice, adopted for the last seven years, will be continued.
– I think that we ought to have, before the Prime Minister himself replies, some statement from the Treasurer furnishing an explanation-
– Oh, dear, dear, dear ! .The hororable member is singing out before he is hurt !
– I am not “ singing out “ at all. I am simply asking, as respectfully as I can, for an explanation from, the Treasurer.
– I also wish to ask whether the Treasurer cannot see his way to throw some light on the matter that has been brought before the House by the right honorable member for Swan. Surely when the Premier of a State telegraphs to a member of this House on a matter of such importance, the Minister of State primarily responsible ought to be able lo offer an immediate explanation. .1 do not think we are asking for any more than we are entitled to.
– Oh, sit down, sit down !
– I am quite prepared to sit down if the Treasurer is prepared to get up.
– Honorable members opposite are squealing-
– Order ! I have not yet called the Treasurer. Has the honorable member for Wentworth finished his speech ?
– Now that the object of my speech is attained, as the Treasurer is prepared to speak, I have nothing more to say .
– What happened was this : The end of the month of May has not yet arrived. It has been usual, when the end of the month falls on a Saturday or a Sunday,to pay on the Friday. The Acting Under-Treasurer telegraphed to the States on this occasion giving reasons why the balances were not to be paid to the States to-day. The reason was this - that it was hoped that the Surplus Revenue Bill would be passed. The Bill ought to have been through. I hope that it will be through before the end of next month. There is no intention, nor was there ever any intention, to create a breach of the Constitution.
– Will the Treasurer countermand the instruction ?
– As the Surplus Revenue Bill has not yet become law, the money will be paid to the States in the usual way - the three-fourths, at any rate.
– Oh, no.
– As far as the Constitution requires, the money will be paid. But I am not going to say any more about the matter.
.- The explanation which the Treasurer has given us has created very grave doubts-
– It ought not to do so. I have said that whatever the Constitution requires will be done.
– As I understand, the telegram which the right honorable member for Swan read stated that the instructions given were that neither this month’s balance nor the succeeding month’s balance were to be paid. The question which I wish to ask. is this - is it the serious intention of the Government, or of the Treasurer, before the Surplus Revenue Bill is passed, to deprive the States not merely of what may be the surplus for the remain ing month, but to deprive them of an amount equal to all the surpluses that they have had duringthe preceding months of this financial year? Because, if that be so, I venture to think that that state of affairs will put a totally different complexion upon the whole proceeding, from that which has been put upon the policy of the Government by this House. It will mean making the Surplus Revenue Bill retrospective in the very worst sense, by taking back from the States, in effect, what has been paid over to them, and depriving them absolutely - if that view be right - of the provision which the Constitution has made for them for the remaining month of this year. I cannot believe that that is the real meaning:
– It is merely in the honorable member’s imagination.
– It is not merely my imagination, because-
– But it is.
– Because the Premier of Western Australia, in the telegram sent to the right honorable member for Swan, if I caught its purport aright, says that the instructions ofthe Treasurer were-
– The language is, “ nor any othermonth.”
– So that the instructions apply to “ any other month.”
– There is no need for excitement. If necessary, the officers will get fresh instructions.
– It seems pretty clear that what I have stated is the fact. It means this - that during the past ten months of this financial year, the Treasurer’s view’ is that we have been paying too much to the States, and that we are now going to take money back from the States. If the telegram of the Western Australian Premier means anything, it means that; and, further, that we are going to take money back from the States by extracting from them all the revenue to which they would otherwise be entitled during these last two months of the financial year. If that be the intention of the Treasurer) I. think that it requires further explanation. I suggest that the explanation which the Treasurer has given us needs to be further explained, or else-
– The honorable member is under a wrong impression. Surely that is enough.
– The Treasurer himself must know-
– I amnot going to say any more about it.
– I am not going to allow the Treasurer to prevent me from proceeding to express my views on this subject. The right . honorable member for Swan has read a telegram-, the meaning of which is as clear as possible, if the statement in it be true. That telegram was sent by the Premier of Western Australia, and it says that instructions have been given not to pay any moneys to that particular State.
– The Prime Minister has a copy of the telegram also.
-I want to know - and I think that the House is entitled to know - whether such instructions were, in fact, issued ; and, if they were issued, are they capable of any other meaning whatever than that the intention of the Treasurer is to compel the States to refund the moneys which have been paid to them monthly during the past months of this financial year ?
.- I think that we have aright to complain of the tone adopted by the Treasurer towards honorable members of this House when he. is asked for information upon important public questions. Honorable members are entitled to resent the contemptuous manner adopted by the. Treasurer when addressing himself to members on this side of the House, The . manner in which he addressed the honorable member for Wentworth was, undoubtedly, unbecoming to. the dignity of the Treasurer’s position.
– What did I say to him?
– The Treasurer has no right to treat any honorable member in such an abrupt, curt and overbearing manner. The question under discussion has arisen in consequence of the telegram received by the right honorable member for Swan from the Premier of Western Australia. But the matter affects every other State’s finances. The explanation given by the Treasurer was not satisfactory ; in fact, the Treasurer’s explanations never are very satisfactory. I understand the position to be that instructions will now be given by theTreasurer that only the three-fourths constitutionally payable to the States will be paid. That may have been a wrong impression, but the. Treasurer’s explanation was so short, snappy, and incoherent, that the House does not really know even now what is the real financial proposal he has in mind regarding the amount to be paid to the States for this month.
– What the Treasurer means is that the three-fourths will be paid this month.
– The Treasurer did not even make that clear. It remains for another honorable member’ to explain what he thinks was in the Treasurer’s mind. I do not think that any honorable member is much wiser now than he was before the Treasurer spoke; and I feel” quite sure something is to be kept back.
– It is very unfortunate that so simple and clear amatter should be distorted.
– Is that a fair statement ?
– It is perfectly plain that the Treasurer’s telegramrelated only to the month of May, and to any later month. In the next place, I should have thought that honorable members were aware that this question was dealt with at the recent Premiers’ Conference. I informed the States Ministers that the Surplus Revenue Bill was proposed to affect any sum to be paid after that date, and not any moneys already paid to them.
– It does affect moneys paid before.
– It does not.
Question resolved inthe affirmative.
House adjourned at 4.15 p.m.
Cite as: Australia, House of Representatives, Debates, 29 May 1908, viewed 22 October 2017, <http://historichansard.net/hofreps/1908/19080529_reps_3_46/>.