2nd Parliament · 3rd Session
The President took the chair at 3.30 p.m., and read prayers.
PETITION.
Senator PULSFORD presented a petition from the Council of the New South Wales Alliance, praying the Senate to pass the Canteen Bill.
Petition received and read.
COMMERCE ACT: REGULATIONS.
Senator MACFARLANE.- I desire to ask the Minister of Defence, without notice, if he will set aside anhour or so of Government time for the discussion of the regulations under the Commerce Act ? I may mention that, owing to the condition of the notice-paper, it will be almost impossible for the motions of Senator Mulcahy and myself to be reached before the regulations have acquired the force of law. I ask for this concession as the motions really deal with public business.
Senator PLAYFORD. - I prefer that the time allotted to Government business should not be taken up with the consideration of private business. Possibly that honorable senator may be able to arrange with those who have private business on the notice-paper to allow him precedence for his motion.
Senator Macfarlane. - I shall try to do so.
Senator PLAYFORD. - If, however, that cannot be accomplished, I promise the honorable senator to give him time on some evening, say from 9 to 11 o’clock, for the discussion of the matter.
Senator Keating. - The regulations cannot come into force if a notice against them has been given in either House.
Senator PLAYFORD. - Yes ; but the honorable senator wishes to make his objections known.
Senator Lt.-Col. Gould. - The motion has to be dealt with within fifteen sitting days.
Senator Millen. - Parliament may be prorogued before we can deal with the motion.
Senator Keating. - Then the regulations will not come into force.
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– I ask the indulgence of the Senate to make a personal explanation.
Honorable Senators. - Hear, hear.
– On Tuesday evening, when Senator Guthrie was speaking on the Australian Industries Preservation Bill, he referred to a statutory declaration which I had quoted from Mr. Henry Best. He said -
Mr. Best, at the time of making the declaration, was lying in the Melbourne hospital undergoing an operation, and the local manager for the United Shoe Machinery Company drove to the hospital, and obtained his signature. The signature was obtained at a time when Mr. Best was not absolutely in possession of his whole mental faculties.
Yesterday I received from Mr. Best the following further statutory declaration: -
I, Henry Best, of Fitzroy, in the State of Victoria, hoot and shoe manufacturer, do solemnly and sincerely declare -
I am informed that Senator Guthrie, on the twenty-first instant, in the Senate, stated that my affidavit, dated the fourteenth instant, read by Senator Pulsford, was made when I was too ill to be responsible for my actions, or words to that effect.
This statement was unauthorized by me, and I am in no way responsible for its having been made.
I now re-affirm and indorse in every particular the contents of my affidavit, dated the fourteenth day of August, one thousand nine hundred and six.
I am now almost recovered from my illness, and have returned from hospital to my own home.
I offered to make the affidavit of the fourteenth of August, after seeing the report of Senator McGregor’s speech in the Herald, and without any request therefor by or on behalf of the United Shoe Company.
And I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of an Act of the Parliament of Victoria rendering persons making a false declaration punishable for wilful and corrupt perjury.
Declared at Fitzroy, in the State of Victoria, this 22nd day of August, One thousand nine hundred and six.
Before me, John G. Yager, J. P.
Motion (by Senator Croft) agreed to -
That the document read by Senator Pulsford be laid upon the table and printed.
– I beg to lay the affidavit upon the table.
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– I have to report to the Senate that to-day, accompanied by honorable senators, I proceeded to Government House and there presented the AddressinReply to the Governor-General’s Speech, and that His Excellency was pleased to make an appropriate answer.
page 3261
Motion (by Senator Pearce) agreed to -
That one month’s leave of absence be granted to Senator Matheson on account of urgent private business.
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Bill read a third time.
page 3261
Senator PLAYFORD laid upon the table the following papers: -
Amended regulation relating to cadet corps, paragraph 22, Statutory Rules 1906, No. 61 ; amended regulations relating to the retirement of Warrant and Non-Commissioned Officers, paragraph 123, StatutoryRules 1906, No. 59, and paragraphs 175, 176, 181, &c, Statutory Rules 1906, No. 58; amended financial and allowance regulations, paragraphs 103, 113, 174, &c, Statutory Rules 1906, No. 60.
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– I move -
That the Bill be now read a second time.
I recognise that in asking the Senate to pass a Bill for the purpose of amending the Constitution, I am taking upon myself a- very great responsibility. I would have preferred if the Government could have seen their way clear to adopt the recommendations made by the Tobacco Monopoly Commission.
– Why did not the honorable senator force their hands?
– That good old fallacy that we are in a position to force the hands of the Government is disproved by the fact that we would force their hands on this question if we could, but we have not the power.
– It only proves that it has not been exercised.
– It shows that the nonsense which is sometimes talked outside by honorable senators about the power of the caucus over the Government is in the nature of a fairy tale. I expect to receive the_ hearty support of all the members of the Opposition, because we are all aware that the only effect of passing the Bill will be to refer the question to the electors. Mv honorable friends are telling the people of Australia that they are anxious to sink the fiscal question, and to have a straightout fight on Socialism or anti-Socialism, and here is a splendid opportunity afforded to them.. By passing this Bill they will be able to raise at the next election that direct issue on the question of the adoption or rejection of the Bill’.
– But we can do that without the aid of the Bill.
– The honorable senator and others go about the country and talk in a vague fashion about Socialism or anti-Socialism.. Here is a definite socialistic proposal on which, if the Bill be passed, the electors will have to be consulted. I cannot conceive of a more practical way of getting a vote on the question at the next election. I feel sure that I shall receive the hearty support of all antiSocialists here in getting an opportunity then to fight the Question in a definite fashion. We are forced to recognise that the powers of the Parliament in the direction of nationalizing industries are limited by the Constitution.
– The honorable senator disputed that before.
– On that occasion 1 expressed my opinion as a layman, and I now bow to an opinion which was not then in my possession, and that is the opinion, of the Attorney-General. Up to that time the only opinion available was one which had been given to the Iron Bonus Commission, and it was of a very indefinite character. The opponents of nationalization read it to mean that the Commonwealth could not nationalize industries, while the advocates of nationalization interpreted it to mean the opposite. It was capable of both interpretations. So far as the tobacco monopoly is concerned, we have a definite expression of opinion which cannot be disregarded by any one, and therefore I put aside my own . opinion. With regard to taking over any industry which! may become a monopoly wel are limited to the implied powers of the Constitution. It is held that, under the implied powers, we could establish iron works for the manufacture of guns, small arms, ammunition, and also for the construction of war ships. It is also held that, as we have to carry the mails round the coast, we could construct ships for that purpose under the implied powers of the Constitution. But when we come to deal with monopolies such as the tobacco monopoly and the sugar monopoly, I think it must be recognised, especially in the light of the opinion given by the Hon. Isaac Isaacs, that -there is no implied power which would enable the Commonwealth to monopolize those industries. The Bill, if passed, will have to obtain the indorsement of a majority of the electors in a majority of the States. Honorable senators can be assured that if the Bill passes both Houses, and then has to run the gauntlet of obtaining the votes of a majority of the people in the majority , of the States and be successful in doing so, it will undoubtedly express the will of the people of Australia. That consideration should disarm much of the opposition that might otherwise be offered to the Bill. A proposal to nationalize an industry cer.tainly can never become law unless there is a tremendous force at the back of it. We are willing to accept the gage on this question. If those senators who call themselves anti-Socialists are in earnest, and mean what they say, they can do no less than give us the opportunity to ascertain whether the people indorse their policy or that of the supporters of this Bill.
– We shall find that out at the elections.
– We invite them to give us the opportunity. If Senator Gray wishes to fight the next election on the basis of Socialism or anti-Socialism, he could not have a better opportunity than by putting this Bill before the electors, and having it to point to as the dividing line. He can hold it up before them as an example of what the Socialists, wish to do. Surely he could not wish for a better chance.
– The honorable senator has given us an opportunity to do that without incurring the expense of a referendum. The introduction of the Bill will have that effect.
– To point to the Bill and to denounce it as a mere proposal would be so much empty talk, and would not be effective. If, on the other hand, the Bill has been passed by Parliament, and is definitely before the electors, there will be a straight-out issue, and a direct expression of opinion can be obtained apart altogether from the fiscal and other issues. I contend that it is necessary that the Commonwealth Parliament should have the further power that the Bill seeks to give to it. If it can be proved that a monopoly does exist in the Commonwealth, and that it is or may become harmful unless the Commonwealth has power to take it over, the States are not in a position to deal with it advantageously. There is no doubt that the States have the power, but if any State endeavoured to take over the monopoly in the tobacco industry, it would almost be courting failure. In fact, the Royal Commission which investigated the tobacco industry in Victoria some years ago recommended that the best method of dealing with it was to make it a State-owned concern ; but also came to the conclusion that owing to the boundaries between the States - there being no Federation at that time - they could not recommend that that should be done at that juncture. I think that if we consider the sugar monopoly and1 the tobacco monopoly, it will be recognised that undoubtedly if they are to be nationalized the best authority to control them is the
Federal Parliament, not the States. Under the States there would necessarily be a divided form of control.
– How does the honorable senator define a monopoly ?
– I take it that each of us can define the .term for himself. For my own part I say that, when an industryhas become so concentrated that a very large proportion of it is practically under the control of one interest, and when it could bv the exercise of its power crush out all opponents and prevent competition, it is a monopoly.
– Where does that condition exist?
– It exists to-day, as the honorable senator ought to know, both in regard to sugar and tobacco. It is true that the tobacco monopoly allows a certain amount of competition in order that it may be said that there is no monopoly, but I can prove that if the tobacco combine chose to use its power, it could without the slightest trouble crush out of existence all its competitors in Australia.
– Oh !
– I am afraid that the honorable senator has not profited by his experience as a member of the Royal Commission. We shall not be treading on unknown ground in dealing with the tobacco monopoly as I propose. British people are notorious for their love of precedent. They like to feel, before entering upon any new path, that some one else has gone there before. I can show that, in regard to the tobacco industry, we shall be following what is now a well-trodden path. France, for many years, has conducted the manufacture of tobacco, cigars, and cigarrettes, as a State monopoly. AustriaHungary and Italy also have their tobacco factories under State control. Still later the rising young country of Japan, after sending experts round the world to study the various systems adopted by civilized nations, and after having had some experience of private enterprise in the manufacture of tobacco, nationalized the industry. Byits means, Japan has been enabled to raise a war loan of ^60,000,000, making the tobacco monopoly the security for the money. The Japanese tobacco monopoly last year realized in net profits upwards ‘ of £4,000,000. The Japanese knew what they were doing when they adopted that course. They did it /for revenue purposes. But I am also in possession of evidence to the effect that when Japan took over the tobacco monopoly, the great BritishAmerican Trust had established itself in the country, and was rapidly becoming the chief manufacturer of tobacco in Japan.
– As a matter of fact, the trust had established a monopoly there. The Japanese Government waited until it had put in the latest machinery, and then took over the industry.
– The Australians are amongst the greatest tobacco smokers in the world. The Japanese people are not pipe smokers at all. They consume principally cigarette tobacco. In France, as in most European countries, including the United Kingdom, the consumption of tobacco is below that in Australia. The price of tobacco in European countries and in America is greater than it is in Australia, and the cost of manufacture in Australia, while it is higher than in the other countries I have named, is not so much higher as to account for the difference in the retail price. Therefore, the proportion of profit derived’ from the tobacco industry in Australia is greater than it is in the other countries mentioned.
– The honorable senator knows the price paid for leaf in those countries ?
– Yes, and I know the price paid for leaf in Australia also.
– France pays as high a price as do other, countries. She buys in the best markets of the world.
– The result of the Commission’s investigations as regards foreign monopolies ‘ is given on page xi. of the majority report, paragraph 36. The Commission says -
With regard to the probable results of the nationalization of the industry, we have every reason to believe that it would be distinctly beneficial from a revenue point of view. France, Italy, Austria, Hungary, and Japan all derive large revenues from this source. France, in 1902, obtained a net revenue of ^13,297,464; Italy, 1902, ^6,419,237; Austria, 1901, £6,107,000. Japan, after sending officials to study the financial systems of European Governments, and after trying the system of taxation by Customs and Excise duties, took over the whole tobacco industry last year, and made it the security for her war loans to the extent of ^60,000,000. France has a revenue from tobacco per head of population of 6s. 10¾d., or of 3s. 1.4c!. per lb. The average retail price for all forms of tobacco, cigars, and cigarettes being 4s. Nd. per lb. (See Mr. Jacob’s statement - Q. 6257), the average wholesale price being 3s. io./d. per lb. (Se£ Mr. Ferguson’s statement). Tables accompanying this report, and compiled from conservative estimates given in evidence, show that Australia receives in revenue from tobacco duties per head’ of population 7s. 4 n-i4d., or 2s. 9 4-7d. per lb., the average retail sale price of all forms of tobacco, cigars, and cigarettes is 6s. 10 4-7d. per lb., the average wholesale price being 5s. 3 4-7d. per lb. The consumption per head in France is 2.178 lbs.; Australia, 2.645 lbs.
– Where was the information relative to the Japanese obtained from ?
– Partly from the evidence of Mr. Ferguson, the Chief Inspector of Excise, and partly from Mr. George Carter, one of the witnesses.
– I think I am correct in saying that no evidence was obtained direct from Japan.
– What does the honorable senator mean by “ direct” ?
– It was all second or third hand evidence.
– The evidence of Mr. Ferguson was obtained by him from the Japanese Customs officials.
– Where is the evidence with respect to the Japanese having made inquiries in Australia and elsewhere?
– It is contained in Mr. Ferguson’s evidence.
– Would the honorable senator mind giving the Senate a statement as to wages paid, hours worked, and the proportion of females to males employed in the industry in France?
– I am not going into the whole question of the manufacture of tobacco.
-Col. Gould. - The honorable senator is wise not to do so !
– The cost of manufacture in France is, I have stated, lower than it is in Australia, and that is accounted for by the high wages paid in Australia. It is a fact that higher wages are paid in the tobacco industry in this country. But there is nothing peculiar in that, because the same remark has to be made in regard to all other industries in Australia. The tobacco industry is not singular in that respect. But there is this important fact to bear in mind - that the wages paid in France in the tobacco monopoly are higher than the wages paid by private enterprise in any similar form of industry in that country. That is the real comparison to be’ made - not the comparison between the wages paid in. Australia and those paid in France.
Taking into consideration the difference in the cost of living, it can be said that the employes in the French State factories are treated in a manner superior to that in which any private employer in Australia treats his employes. In the French industry there is an accident fund, and an old-age pensions fund. Any employe, after serving for a number of years, is entitled, on retiring, to receive a pension for the rest of his life. Honorable senators can find that information in the evidence given before the Commission by Mr. Jacobs.
-Col. Gould. - What is the amount of the pension, and what are the wages paid?
– The honorable senator will find a full statement on that subject in the evidence. It is too lengthy for me to read now.
Senator Higgs. - If the honorable senator gives the details, Senator Gould and others who are interjecting will vote for his Bill !
– Yes ; I am quite sure that they will ! In arriving at an estimate as to the cost of manufacture in Australia, and as to the probable profit, the Royal Commission was met with a very great difficulty owing to the absolute refusal on the part of the members of the combine to disclose their profits, or their cost of manufacture.
– Mr. McKay did the same before the Tariff Commission.
– But we were able to find out practically all that we wanted to know. We were able to ascertain by another method exactly what it costs to manufacture cigars, cigarettes, and tobacco in Australia, what the material costs, the retail selling price, and the cost of distribution. We were able to find that out indirectly from the evidence of the manufacturers themselves, although they refused to give us the information directly. If honorable senators will turn to the tables a, b, and c, compiled bv the Commission, and printed in the report from pages 12 to. 15, they will find that the whole of the results arrived at there are derived from the sworn evidence of experts engaged in She manufacture and distribution of tobacco. For instance, in arriving at the cost of the tobacco leaf, we took the evidence given by the manufacturers. In arriving at the cost of manufacturing tobacco, we were able to ascertain what we wanted to know from the evidence of the manager of the New York and Brooklyn Tobacco Company.
– He was only an accountant.
– Is Mr. Jacobs anything else? Does he actually make the tobacco in which he is interested? But Mr. Jacobs, although he does not actually make tobacco, has access to his own books ; and does he not know the doings of his own company? Similarly, Mr. Davis, although he is an accountant, was fully capable of giving us an opinion as to the cost of manufacturing. He did give us the cost of manufacturing three grades of tobacco, and our estimate of the cost of manufacture is based on the sworn evidence given by him. Mr. Davis is not to be regarded, either, as one who is opposed to the combine. His expressions of opinion were friendly to it - so much so, indeed, that I had suspicions as to whether he was not connected with it in some way.
– Is his firm one of the associated firms?
– So far as we were able to ascertain, he was not connected with the combine, although he was engaged in the same business.
– Therefore the combine is not a monopoly to that extent?
– No more than a fly on a locomotive is part of the train. In regard to the manufacture of cigars, we had the evidence, not only of members of the combine, but also” of cigarmakers outside the combine, many of whom are carrying on business in Sydney and Melbourne. Some of the makers, like Mr. Schuh, manager for Snider and Abrahams, one of the biggest competitors; outside the combine, gave us valuable information. We were able, by taking this information and analyzing it, to ascertain, as I have explained, exactly what we wanted to know. Mr. Schuh, I may remark, did not express himself as opposed to the combine in any way. We had’ from Mr. Ferguson, who obtained them from retail shops in Melbourne, samples of practically all the forms of cigars,; cigarettes, and tobacco, with their prices. We were able to ascertain the proportion sold, and could arrive pretty accurately at the relative values of the samples imported and manufactured for sale in Australia. So that honorable senators will find that the tables which I have mentioned are fairly reliable. If they err at all, they err on the side of making the profits appear less than they actually are. In fact, we had one witness before the Commission, Mr. George Carter, who has made a life-long study of this subject. He presented an estimate based on his own experience, and disclosed a profit of nearly twice as much as that shown by the Commissioners.
– Does the honorable senator not know that Mr. Carter has made two or three reports, one contradictory of the other ?
– I do not know that Mr. Carter has done so, but I do know that Mr. Jacobs attempted to prove that Mr. Carter’s evidence was misleading. Mr. Jacobs himself, however, came so nearly within a charge of that kind, that I would not place him as a judge in regard to any action of Mr. Carter.
– Mr. Carter issued a circular about six months before, which contradicted his other statements.
– On page 14 of their report, the Commission make a comparison between the present system and the system which they recommend. It is shown that in 1904 the -
Population was 3,927,025 ; consumption, 10,386,236 lbs. or 2-643lbs.perhead; gross revenue,£1,452,754; net revenue, after deducting 3 per cent, cost of collection,£1,419,253 ; net revenue per head, 7s. 2 14-19d., net revenue per lb., 2s. 8 2-5d. ; average retail selling value, all forms of tobacco, 6s. 10 4-7d. per lb.
Taking it that the prices, the cost of leaf, and manufacture, population, and consumption remain as at present, it is estimated that under a State monopoly the figures would be -
Revenue (gross),L3,572,895; net revenue, £1,821,825; cost of production, purchase, and sale,£1, 751,070; present net revenue, Customs and Excise,£1,419,253; balance, additional revenue under Stale monopoly,£402,572 ; net revenue per head,9s. 31/3d. ; net revenue per lb., 3s. 61-10d.
– Has the honorable senator allowed for the increased wages under a State monopoly?
– I am taking the cost of manufacture, which includes wages, as at present under the Wages Boards and Arbitration Act decisions; but, as a matter of fact, the wages paid in Adelaide, and, I believe, in some instances in Sydney, are below those fixed by the Wages Boards in Victoria. I should now like to show what has been the effect of private enterprise on this industry in the past. It is sometimes said that
State monopoly would crush out individuality and prevent private enterprise; but what has been the experience in other countries where the tobacco industry is a State monopoly? In France the tobacco industry has been a State monopoly for over 100 years. In 1901 France produced 55,914,869 lbs. of local leaf, out of a total of 80,693,824 lbs. of tobacco manufactured - that’ is, practically 55,000,000 lbs. out of 88,000,000 was local leaf. Australia, with the tobacco-grower in the beneficent hands of private enterprise, produced in 1903, only 802,237 lbs. of leaf, out of 6,601,211 lbs. of tobacco manufactured.
– Is the honorable senator aware that 8d. per lb. was given for Australian leaf, and that when it was sent Home it sold for 41/2d. per lb. ?
– I am aware of a good many things of which the honorable senator has no knowledge in connexion with this industry. If the honorable senator had gone with the Royal Commission to Tumut, he would not have been surprised at the fact that the Australian leaf realized only 5d. per lb. in London. After the treatment meted out to the growers, I can almost believe the combine capable of anything.
– Is the honorable senator aware that Australian leaf for which the manufacturers gave 8d. per lb. was sold in England at 41/2d. per lb.?
– I am aware that the trust offered a prize for the best leaf grown at Tumut, and pledged itself to give 8d. per lb. for the first-prize leaf. What happened was that the grower who won the first prize received 8d. per lb. for the quantity which was put into competition, but for the stock of leaf of the same quality which the grower had, he was not given 8d. per lb., or anything like that price.
– That is absolutely untrue.
– I ask that that statement be withdrawn.
- Senator Gray must withdraw that remark.
– I withdraw the remark, but I say that the statement is incorrect.
- Senator Gray will have an opportunity to follow me, and there is no necessity for him to make statements or remarks of the kind to which I have objected. The trust, in order, as it was said, to prove that it did “ the fair thing,” offered to purchase a barrel of the tobacco of the first prize quality, and send it to England for sale in the open market. As a matter of fact, however, the growers had no representative to look after their interests, and were not aware what leaf was sent to England.
– Does the honorable senator infer that the manufacturers in this connexion did what was wrong ?
– From my experience of the manufacturers, I should think they are capable of anything, and I shall tell the honorable senator why. The representative expert of the tobacco combine was present during the giving of evidence at Tumut, and when the winner of the first prize tobacco was being examined, a sample of the tobacco was placed upon the table. This grower is a native of America, and has followed the occupation of tobaccogrower all his life. He told the Commission that the leaf then produced would, in America, be worth 8d. per lb.
– Who brought the expert from America?
– He was brought out by the tobacco combine. This witness, on oath, gave his word that he would expect to realize in America Sd. per Jb. for such leaf. The witness who followed was the expert buyer for the combine, and he, indicating the sample of tobacco, said, “ I venture to say that that tobacco sold in South Carolina would not realize more than 5d. per lb.” I asked him whether he was sure that it would realize 5d. per lb. in America,, and he replied in the affirmative. I then pointed out to him that in Australia* there was a duty of is. per lb., and that, therefore, on his own showing, that tobacco should be worth is. sd. per lb. in Sydney, without considering freight, although the combine had given only 8d. per lb. for a small parcel. That was the evidence of the expert buyer of the tobacco combine. If there is anything in the statement of honorable senators opposite that a duty raises the price of the article, especially when there is not sufficient local production to satisfy the demand, then that leaf should be worth at least is. 5d. per lb., duty paid, in Sydney.
– Can the honorable senator point, to any country where the manufacturers pay a higher price for leaf than is paid in Australia?
– It is such treatment as I have indicated that makes me very suspicious of anything the combine may do. Let me now, however, return to the subject of the production in France, as compared with that in Australia.
– The honorable senator, in one of his previous speeches, gave us the reason for the unsatisfactory position of the tobacco-growing industry in Australia ; he said it was owing to the ig norance of the growers in preparing the leaf.
– I have received some information since which causes me to think that the grower knows more than I gave him credit for. At any rate, the grower is showing hia good sense by not producing any leaf at present. In 1890 there were 4,740 acres under tobacco cultivation in Italy, the Government of which had not long taken over the industry. In 1902, the acreage in that country had increased to 12,293, a difference of 7,553 acres in twelve years. There was a time when Australia cultivated a fair acreage, and produced a large quantity of tobacco. The acreage and production reached their highest point in this country in 1888, when 6,641. acres produced 7,868,112 lbs. of leaf. Since 1888 there has been a gradual drawing together of the factories, which have become fewer and fewer, until in the last three years we have seen the monopoly by the tobacco combine.
-Col. Gould. - Had the Excise nothing to do with the decrease of production ?
– Had change of taste nothing to do with it?
– In 1903, in Australia, 1,323 acres produced 802,237 lbs. of leaf, a decrease of 5,419 acres and of 7,065,875 lbs. of leaf. I recommend these figures to our farmer friends as an example of what is happening in Italy and France under State Socialism, as compared with the position of the grower in Australia under private enterprise.
– I suppose the honorable senator acknowledges that the quantity of tobacco produced was reduced very considerably before the combine came into existence ?
– Certainly. I say that the reduction has been going on since 1888.
– Then the combine has nothing to do with it.
– The combine has a great deal to do with the reduction.
– What ! Before it came into existence?
– The honorable senator does not seem to grasp the fact that since 1888 the factories have been becoming fewer, and that buyers have been disappearing and competition lessening, until, in 1900, thelatter practically disappeared because there was only one buyer. Ever since 1888 there have been two movements in the tobacco trade of Australia - a gradual diminution of competition in the manufacture, and the elimination of the tobacco grower from amongst our farmers. There is another significant feature to which I drew attention, when dealing with the Australian Industries Preservation Bill, namely, the lessening the cost of production, and the increase of profits to the manufacturers. There is indisputable evidence that in the case of certain brands of tobacco, there has been an increase of price since 1901. Of course, I know that the combine contend that this is clue to the Tariff, but it is significant that in some States the Tariff, so far from warranting an increase in price, should have been followed by a decrease. In South Australia, for example, practically no local leaf was used prior to Federation. Every bit of leaf which entered South Australia at that time had to pay a duty, and the Excise was not higher then than it is at present ; therefore, the throwing down of the InterState barriers opened to the Australian manufacturers a. market for local leaf. Ever since those manufacturers have been , largely using local leaf, which, of course, pays no duty ; and in their sworn evidence they give the average price as under 5d. per lb.
– Was the import duty as well as the Excise duty, in South Australia the same before Federation as now?
– No, but very nearly the same.
– I mention that, merely because it is a factor that the honorable senator seems to ignore.
– I can assure the honorable senator that the duties do not affect the case I am presenting, the difference being so small. If honorable senators turn to the evidence of Mr. Ferguson, they will there find the rates of duties in the various States. . The point is that, so far as raw material is concerned, the manufacturers in South Australia had to nay duty ‘prior to Federation, whereas since then at least one-fourth of their raw material has been duty free. The duty before Federation was greater than the whole cost of Australian leaf at the present time, so that, on the manufacturer’s own showing, and on the facts as presented to the Commission, it cost more to produce tobacco in that State prior to Federation than it has cost since. There has been no substantial increase in the price of foreign tobacco leaf since Federation. The position is much the same in the other States as in South Australia. It will be found that, on the whole, so far from Federation having made it more expensive to manufacture, it has resulted in a saving. It is a fact, however, that for” Havelock,” and one or two other brands, the prices to the retailers were raised shortly after Federation. Prices were not raised to the consumer, because the additional cost to the retailer was so small that it could not be passed on ; and the result is that the combine has deprived the retailers of a certain amount of profit, which the latter previously received. The same conditions prevail in relation to certain lines of cigars.
– It is remarkable that the retailers have found no fault.
– The retailers have found fault. Scores of retailers told me of the exactions of the combine, but when I invited them to give evidence they said’ that theydid not want to be “ thrown into the streets “ - that to give evidence would be more than their business was worth. The only retailers whom I could induce to give evidence were those in a large way of business - practically wholesalers - who spoke in the most flattering terms of the combine, and, no doubt, got their reward in, perhaps, better terms in the future.
– The honorable senator could not get any independent tobacconists to give evidence?
– Not any small retailers. The combine has derived the whole of the profit from the increased prices, and, in addition, has by the very organization effected a saving in the case of production. I have here some figures which I compiled from the very valuable evidence of Mr. Ferguson, the Chief Inspector of Excise. I recommend those figures to the attention of honorable senators, because they constitute a mine of information from an unbiased and reliable source. The figures are shown on page 22 of Mr. Ferguson’s evidence, and show that in 1901 the production of manufactured tobacco amounted to 5,075,537 lbs. ; of cigars, 183,877 ; and of cigarettes, 741,597 lbs. - a total production of all forms of manufacture of 6,601,211 lbs. In 1904, the local production was as follows: - Tobacco, 7,018,560 lbs.; cigars, 250,042 lbs.; cigarettes, 995,271 lbs.; making a total weight of 8,263,873 lbs. As compared with the production in 1901, that shows an increase of 1,343,023 lbs. of tobacco, 66,165lbs.of cigars, and 253,674 lbs. of cigarettes, or a total increase of [,662,662 lbs. If we refer to Mr. Coghlan’s book for 1901-2, we find that the number of employe’s in tobacco, cigar, and cigarette factories in 1901 was 2,979. If we refer to the evidence of Mr. D. Ferguson, on pages 274-6, we find that in 1904 the number of employes in all these factories in Australia was 2,816. With 163 fewer employes in 1904 than in 1901, the combined factories produced 1,662,662 more lbs. tobacco of all forms.
– How does the honorable senator account for that? Is that owing to machinery?
– It proves that the elimination of competition is a good thing, because it cheapens production. By that means, the combine have been able to save a lot of useless labour, such as commercial travellers, agents, and various commissions, and to concentrate their labour into larger factories, instead of having management staffs in each State. They now practically do all their manufacturing in two States. We have there a practical illustration that collectivism is better than competition, that it is a cheaper and better form of production altogether.
– Because it does not pay for a lot of useless labour.
– Will the honorable senator wait until he hears what conclusions I draw from those facts?
– Did not the Commission obtain later figures as to the number of hands employed ?
– No. I am quoting official figures, which, of course. I prefer to those of the combine. In any case, the combine could only state how many hands they employed in their own factories, whereas the official figures embrace all the factories in Australia. If the honorable senator will recollect that, in Victoria, there are upwards of fifty separate cigar makers, some of them using only their own labour, he will see how impossible it is for the combine to give accurate figures, Every cigar-maker has to pay a license, and, therefore, the Inspector of Excise is in a position to know how many men are employed.
– By this Bill the honorable senator would destroy every one of those small industries?
– What nonsense ! We would do exactly what the combine has been doing. We would still further economise and concentrate, but we would not crush out the growers, as the combine have done. Let us now see what conclusions are to be drawn from the figures. In 1901 the production of the factories amounted to 2,216 lbs. of all forms of manufactured tobacco, cigars, and cigarettes for each person employed, while in 1904 it amounted to 2.934! lbs. per head, so that 7181/2 lbs. more tobacco, cigars, and cigarettes was produced by each employe under the combine in1904 than in 1901. It was proved before the Commission - and I refer honorable senators to tables A, B, and C on pages 12, 13, and 14 of the report - by the evidence of the combine’s witnesses that the average manufacturing cost of all forms of manufactured tobacco, cigars, and cigarettes was about1s. 71/4d. per lb. I am taking the farthing as representing 4-11d. It is not quite accurate, but it is near enough for the purpose of making a comparison. The combine saved the labour of 163 employes in 1904 which, at a production per head in1901 of 2,216 lbs. of tobacco, represented 361,208 lbs. The remaining employes produced 1,662,662 lbs. more in 1904 than was produced in 1902, thus making a total gain of 2,023,388 lbs., the manufacturing cost of which at1s. 71/4d. alb represented a saving of . £162,595 in 1904 as compared with 1901. No evidence can be produced to show that between those years the combine raised the wages of any of their employe’s. On the contrary, it can be proved from sworn evidence, and from figures supplied by the combine, that during those years they replaced male labour with female labour, and consequently effected a saving in wages rates, because the females received a lower wage. Under the same system the number of boys was increased, so that the saving which is represented by these figures is much below the mark. The saving alone to the combine must have approached to £200,000 per annum as the result of the combination. The singular point is that there is no one in the Senate or elsewhere who is’ bold enough to sa.y that the combine have passed on to the general public a single penny of the saving.
– Does the honorable senator mean ^200,000 over and above what they were losing, owing to the competition which he acknowledged to exist before the combine was established?
– I do not admit that they were losing. At any rate, if the combine were losing money why did they not say so? Why did they npt show the people of Australia) that it is not the profitable enterprise which it is supposed to be? I took particular care, as did other members of the Commission, to ask each witness representing the various factories in the combine what were their profits, and without exception they refused to tell us.
– Very properly.
– If it is a losing concern, what had the combine to lose by disclosing the amount of the loss? What had thev to lose by saying to the people of Australia, “ This industry, which the Labour Party want to nationalize, would be a losing concern, as you will see if you look at our balance-sheet “ ?
– -The honorable senator is twisting what I said. I said that prior to the establishment of the combine the extraordinary competition, which the honorable senator acknowledged in the majority report, showed almost to a certainty that at that time, at all events, they were losing money.
– I do not admit that, and it is not courteous on the part of the honorable senator to accuse me of twisting anything. He must admit that, holding the opinions I do, my deductions are fair.
– When I spoke of twisting, I did not mean what the honorable senator understood.
– I contend that this monopoly constitutes a national danger to Australia. A combination which’ cheapens production and eliminates waste is a good thing, but it is a bad thing to leave a monopoly in the hands of any individuals. I have no animus against the members of the tobacco combine as individuals, but I contend that the power which they hold over the people of Australia constitutes a national danger. I am not prepared to allow that power to remain in the hands of any individuals, because it has been shown that it can be- used to oppress the producer and the consumer;. When an industry obtains the power which a mono poly confers, the only safety lies in the control and ownership of the industry by the people. Suppose that it were taken over by the Commonwealth, does any one think for a moment that the people would countenance the state of affairs which in twenty years has decreased the cultivation of tobacco by 5,000 acres? The experience of France and Italy shows that a State which is interested in placing its people on the land would encourage the growing of tobacco. Of course, it will be urged that the tobacco combine have increased the growing of tobacco leaf, and spent money.
– Have they not?
– I am not prepared to admit that they have.
-Col. Gould. - Before the combine was formed, what happened?
– I admit that before the combine was formed the firm of Hugh Dixson and Sons did spend a large sum upon experiments in tobacco growing. J fail to see where the combine have done anything to assist the growers of tobacco leaf. On the other ‘hand, by the prices which they have been paying, and through there being only one buyer, they have practically crushed out the growing of leaf in Australia. The charge is sometimes made that under a State monopoly an inferior quality of tobacco would be supplied. Now, the people of France, whatever may be their faults, cannot be accused of lacking the organ of taste, because they are supposed to possess the finest palate of any people in the world. After all, the quality of tobacco is entirely a question of taste. I venture to say that if I could get some pure tobacco leaf, and I may say that I am stating the result of my experience
– I thought the honorable senator was a non-smoker?
– I made an experiment upon some members of the Commission. It must be remembered that in the United Kingdom the only ingredients allowed to be used in the manufacture of tobacco are water and some sweetening in the form of sugar. If I could get these three ingredients, put the article under a press, and give the tobacco to an honorable senator who has been smoking, say, Havelock tobacco, probably he would pronounce it to be vile stuff. If I gave a man who has always smoked tobacco as made in England a plug of Havelock tobacco, or a similar brand, he would pronounce it to be vile stuff. The quality of tobacco, I repeat, is purely a matter of taste. To a Frenchman French tobacco is the best in the world.
– He cannot get any other.
– That old idea has been thoroughly exploded. A Frenchman can get any tobacco he wants, because he is allowed to import it; in fact, the Government will import it for him if he likes. There are importers of tobacco, cigars, and cigarettes into France, but the imported tobacco cannot be sold in competition with French tobacco, simply because the Frenchman has been used to the local tobacco, and, in fact, prefers it.
– At what price do Frenchmen get imported tobacco?
– One witness told the Commission that he was not in England very long before he sent out to Australia for some of his favorite tobacco, as he could not stand the English tobacco, and other witnesses who had come from England said that they did not like their first taste of Australian tobacco. Will anyone contend that if the Commonwealth were to take over the tobacco factories tomorrow the makers of tobacco would at once lose their knowledge of the process. My service on the Commission has taught me that the Australian smoker smokes tobacco containing a lot of seasonings, such as no other smoker in the world smokes, and seasonings which, moreover, are by no means necessary for the making of tobacco.
– They are not injurious, though.
– Some of them may be injurious.
– An analytical chemist has told’ me the very opposite.
– That may be. Are the seasonings put in for the benefit of the smoker? If any honorable senators hold that view, they are very simple. When the leaf is bought by the manufacturer, being dry, it is at its very lightest weight. In the steam pipe it absorbs a considerable amount of moisture, and if it were pressed and manufactured in .that state, what would happen? It would become mouldy. Every pound of moisture which the manufacturer can get into the leaf means so much profit to him. If the retail price of the article is 3s. per lb., every pound of moisture he puts into the leaf means a profit of that amount to him. Therefore, he has to put into the leaf something which will not allow the tobacco to go mouldy. The seasoning is put in not to benefit the smoker, but to counteract the effects of the moisture.
– If an unlimited quantity of moisture were put into the leaf, smokers would not buy the tobacco.
– No matter what the smokers like or do not like, as much moisture as the leaf will hold is put in, and I make that statement as the result of my visits to the factories. The seasoning is not put in to pander to the taste of the public, but to enrich the manufacturer. Leaving the tobacco monopoly, I desire to show that there are other monopolies in Australia. The sugar monopoly, for instance, has a big effect upon Australian industry - because sugar enters into a large number of manufactures. Practically one firm refines all the sugar used in Australia. It meets with very little competition, because, as in the case of the tobacco combine, there are only a couple of small outside firms, and these do about 5 per cent, of the total trade. The sugar combine, in Western Australia, at any rate, give rebates to the buyers in order to get control of the whole trade of Australia, and so stop the sale of imported sugar. By the aid of their monopoly, they are able to raise the price of sugar up to the limit allowed them by the Tariff. Although they make a profit of £300,000 per annum, still, during the past season, they refused to give the growers of sugar cane in Queensland a fair price. As a matter of fact, it is paying ai lower price for cane than is paid by the State-owned sugar mills in Queensland.
– Would the honorable senator propose to give the growers in a bad season exactly what thev liked to ask f or ?
– What the State is now doing in Queensland1, it will, I presume, continue to do.
– Besides, this is not a bad season.
– Of course it is not. The fact that the State mills in Queensland are paying a price higher by some shillings per ton than the Queensland Sugar Refinery is paying shows that the State treats the grower better and fairer than a private monopoly does.
– It has not done so in the’ past.
– It is doing so today. The fact is, however, that this sugar monopoly has practically the power to fix the price of sugar-cane in Australia, and also has power to fix the retail price of sugar. Therefore, it has in its grip on the one hand the growers of sugar-cane, and on the other hand, the manufacturers who require sugar as a raw materia] for the production of their commodities. No monopoly should- be allowed to exercise such a baneful influence as that. There is another possible monopoly to which Senator de Largie has, on several occasions, drawn attention. I allude to the iron industry. Honorable senators who have listened to me will agree that the probabilities are that if that industry is established in Australia, it must, from the nature of things, become a monopoly. There is not room in Australia for more than one large ironworks. Indeed, the market is so ‘ restricted that to start the iron industry in Australia must inevitably conduce to monopoly. The iron industry, I venture to say, deserves the name of mother of all industries as no other does. If we here, as has been done in America, let private capitalists get control of it, we shall have our Carnegies and our Jay Goulds, and other millionaires, and in the future along with them we shall have the usual crop of paupers and poverty-stricken people.
– The honorable senator means that that will be the effect if we have the iron industry under a protective Tariff?
– Tariff or no Tariff, I do not think that there will be much difference. The evidence given before the Royal Commission shows that iron can be produced in Australia at lower cost than that at which it is being produced in America. The point is a debatable one, perhaps, but I venture to say that with a fair amount of capital in Australia, especially if it operates in conjunction with American capitalists, the probabilities are that it would be possible to establish an iron industry without a Tariff. But Tariff or no Tariff, I maintain that the manufacture of iron ought to be a national industry, and that we ought not to allow it to get into the hands of private monopolists. Next, take shipping. The matter has been dealt with very fully, and, there fore, I do not intend to refer to it except to say that I regard it as being as necessary to have coastal shipping in the hands of the State as it is to have State-owned railways. If it is essential - and it can be proved to be essential from the example of monopolies in America - that the railways should remain the property of the people, and be worked for their benefit, it is equally necessary that the shipping on our coasts - which constitute ari artery of commerce just as our railways are arteries of commerce - should become the property of the people. Unless the people of Australia take steps to prevent it, the shipping ring will become a national danger. We have, I contend, a right to ask that the power which this Bill proposes to secure shall be given to the Commonwealth in order that it shall be “n the position to say to monopolists, “ We shall take your monopoly out of your hands, compensating you for it, and in future running it in the interests; of the people.” The object of this Bill is to ask for that power, I invite honorable senators opposite, if they believe that a majority of the people of Australia are opposed to the Commonwealth having the’ power, to take this opportunity of proving it. If they vote against the Bill, what conclusion must we come to? That they are afraid to obtain an expression of opinion on this question - that they are afraid to let the people of Australia say whether they will give this Parliament the power to pass such legislation as that to which I have referred. Therefore I shall wait with interest for the vote that will be cast upon this Bill. I ask honorable senators to give us an opportunity of appealing to the people as to whether they will give the Commonwealth Parliament this power; remembering that, even if we are successful in our appeal, it will still be an open question whether any particular industry shall be nationalized. No industry can be taken over unless with the consent of the people, and unless there is a majority in both Houses of this Parliament in favour of the proposal.
Debate (on motion by Senator Millen), adjourned.
page 3272
Bill received from House of Representatives, and (on motion by Senator Playford), read a first time.
page 3273
Debate resumed from 16th August (vide page 2925), on motion by Senator Dobson -
That the Bill be now read a second time.
– I should like, in commencing my speech, to indorsethe protest made by the Minister of Defence in regard to the extremely intemperate speech on a temperance subject delivered to the Senate by Senator Dobson. It is a curious thing that if you want to hear anything that is absolutely intemperate and inflammatory, you must expect to get it from some one who is an ardent advocate of temperance. Such gentlemen may believe in temperance with regard to intoxicating liquors, but they always appear to me to be the victims of verbal and mental intoxication. On the occasion to which I refer, I am afraid that my honorable friend Senator Dobson was no exception to the rule. I wish to say at once that my honorable friend did not mean it when he accused those who opposed this Bill of being fond of drink, and of being claimants for the right of men to get drunk when they liked.
– I never said anything of the kind.
– I begthe honorable senator’s pardon. I took down the expressions as illustrating the type of remarks which he addressed to the Senate in support of the measure. If he denies having used them, of course - subject to a reference to Hansard - I must accept his denial. But whether my quotations are literally correct of not, they are not unfair representations of the kind of remarks which he made, and I am sure that when he made that intoxicating speech, he did not honestly mean all that he said. I desire to deal with some of the evidence - if I may so term it by a stretch of language - which Senator Dobson submitted to the Senate in support of his views. Honorable senators will recollect the manner in which he denounced the evidence quoted by Senator Turley as being taken from American sources, and therefore to be discounted. But Senator Dobson himself fell back upon quotations from an American temperance journal. I leave it to honorable senators to determine whether the evidence brought forward by Senator Turley, obtained from official records, and from reports submitted by officers of the United State’s Army, and by their chaplains and medical officers, is not entitled to outweigh the quotations from the temperance journal produced by Senator Dobson.
– Senator Turley’s evidence was in the interests of those who conduct the drink business, which runs mad in the United States.
– Here is my honorable friend again giving fresh evidence of his want of temperance !
– I stand to my guns.
– The honorable senator is standing, not to guns, but to saloons. He is an advocate for the maintenance of drinking saloons.
– Nothing of the kind. The honorable senator wants to put drink before our young men in their camps and barracks.
– I do not want to close up places where our young soldiers will get what they require under proper regulation, and drive them to drinking saloons. I regard the source of my honorable friend’s evidence as indicating his want of logic, when he denounces the high official authorities quoted by Senator Turley, and brings forward a partisan temperance journal in support of his contention.
– The journal which I quoted based its statements upon statistics and facts.
– The statements might have been published bona fide, but the very fact that they were quoted from a temperance journal indicates that the source was prejudiced. One can reasonably assume that a journal devoted to a particular cause will naturally select for publication only such evidence as supports its own views. But, on the other hand, Senator Turley produced evidence from people who are totally disinterested - clergymen, medical officers, and military ‘officers, who have formed their opinions as a result of experience.
– They made their statements on account of the saloon’s which were established close to the camps.
– My honorable friend himself said, in dealing with his American quotations, that the dives established outside the military camps were the great curse of the American Army. Yet he is an advocate for such establishments.
– What?
– Let him stand to his guns now. My honorable friend showed fromhis own quotations that the great evil that has attended the military forces in America was due to the saloons which hedge the camps around on every side. But what does he now propose to do? Does he propose that we shall have total prohibition in this country? Not at all. He wants to abolish the consumption of liquor under the discipline of the camp, but outside he would permit its sale. Does he believe in local option?
– Certainly I do.
– ‘It is a curious thing that, while our policy has been to remove from our citizen soldiers every disability which could differentiate them from ordinary citizens, while we give them the right to vote, and enable them in other respects to exercise the rights and privileges of citizenship, Senator Dobson urges that, so far as drink is concerned, they should be put in a distinct class by themselves. He believes in local option so far as concerns the ordinary citizen ; but where the soldier is concerned (he would not allow the principle of local option to apply. If the soldiers decided in favour of the abolition of the wet canteen, I should maintain that their wishes ought to be respected.But I deny the right of Senator Dobson, or any one else, to say that, if any soldier desires, to nave a glass of liquor” he shall have to go outside hisbarracks or his camp to buy it. If Senator Dobson were prepared to go in for absolute prohibition, I could understand his point of view. But, as he proposes to leave the hotels outside the barracks and camps flourishingvigorously, under no discipline, and with all sorts of other attractions, from which the canteen is free, it appears to me that his attitude is utterly illogical.
– My attitude is that I would have no public-house inside any barracks or camp.
– But does the honorable senator believe in the maintenance of the public-house up against the barracks or camp? If my honorable friend is so strong on the point, why does he not advocate prohibition?
– I would vote for prohibition, so far as concerns the supply of drink to ouryoung soldiers.
– But, at the same time, the honorable senator would allow the young soldier to go outside his barracks, and get as much drink as he liked.
– That is not correct.
– Does my honorable friend then believe in absolute prohibition ?
– We could not enforce it. If we could I would vote for it.
– Exactly ; and if we abolish the canteen, we shall not have abolished drinking, or removed it beyond reach of the soldier. We shall merely have stopped it from being sold where it can be consumed under restriction, and where there is every inducement for temperance to be observed.
– My honorable friend is very intemperate and unfair, so far as my argument is concerned.
– If I have been unfair, I express my regret, and if I have been intemperate, I can only say that it was due to the evil communications that corrupt good manners.
– Let the honorable senator continue to advocate the inside “ pub.”
– Why should Senator Dobson be so touchy about the “ pub “ outside?
– I am not; but the honorable senator is advocating the “ pub “ inside.
– I shall always advocate the public-house under proper control and discipline, as against the publichouse free from control and discipline.
– This debate has caused the Minister to issue fresh regulations for the control of canteens.
– Senator Dobson has asked where there is a case of a properly controlled canteen. My reply is that no one who had ever seen the canteen in the Victoria Barracks, Sydney, would ask the question.
– There is drunkenness there.
– It would be a fortunate thing if the percentage of drunkenness in Tasmania were as low as it is in the Victoria Barracks, Sydney.
– There are no canteens in Tasmania.
– I am speaking of the whole population of Tasmania. Although I have lived for some time in Sydney, it was only on the introduction of this Bill that I took an opportunity to have a look at all the frightful horrors we have been given to understand are associated with canteens. Having gained my impression of a canteen from some of the speeches made by advocates of the Bill, I went to the Victoria Barracks, Sydney, with a certain amount of fear and trembling, having some doubt whether it was the sort of place I ought to visit. The canteen was a revelation to me. The Minister will confirm my statement that a better or more orderly club could not be conceived ; indeed, one would not know there was a canteen there, unless taken to rather an out-of-the-way place where it is conducted. In connexion with the canteen are splendid recreation and billiard rooms, a small hall with a stage and pianola, and various other accessories for the innocent entertainment and amusement of the men.
– Chess and draughts are also provided.
– There is everything that can be conceived of as being likely to attract the men away from the injurious and, unfortunately, seductive influences outside.
– No barmaids.
– No barmaids. The man in charge of the canteen is under no inducement to force liquor on anybody ; on the contrary, he himself would be penalized if he allowed the soldiers to consume more than they ought. Compare that discipline with the conduct of an ordinary hotel. Did any one ever hear of a barmaid or barman being dismissed for selling to a customer more liquor than he could safely carry? I venture to say that the penalty would be the other way about.
– There are numbers of barmen who are ordered by their employers not to serve drunken men.
– That is so; I am not making any accusation against the ordinary conduct of the trade. But honorable senators will recognise a considerable difference between an ordinary barman and a man in charge of a canteen, who knows that nothing a customer can say can affect the authority which issues the instructions I have indicated.
– Is the honorable senator speaking of canteens generally, or of only one canteen?
– I am speaking of the canteen at the Victoria Barracks, Sydney.
– Does the honorable senator not know that the Minister has stated publicly that irregularities have occurred in each of the canteens?
– Not in connexion with drunkenness.
– The idea of giving credit for drink ! Is that the way to regulate canteens?
– Do saloons not give credit ?
– I have nothing to do with saloons - I desire to get rid of them. Does the honorable senator know that the Minister is going to prohibit all spirits at canteens? Is that the liberty of the subject?
– Is it my friend’s method of answering a question, to ask another one ?
– I must really ask Senator Dobson to restrain his impetuosity.
– As to the question of local option, I find on going through the figures contained in some papers which were laid upon the table, that something like 239 men of the Permanent Forces are in favour of the maintenance of the canteen, while only 28 are in favour of its abolition. I do not know what majoritySenator Dobson would require to determine the question of local option ; but, in face of the figures I have mentioned, two things are apparent - first, that an overwhelming majority are in favour of the maintenance of canteens, and, secondly, that the men most competent to form an opinion, see no evil in the canteen. I am of opinion that of 250 odd men there must be a considerable percentage who, even if they themselves took drink in moderation, would still vote for the abolition of the canteen atsome personal inconvenience, if they, thought its maintenance detrimental to their fellow soldiers. I understand from the Minister of Defence that I am at liberty to read a letter which he has received, and which he has been courteous enough to hand to me this afternoon. This is a letter addressed to Lt.-Col. Wallace, Commandant in Western Australia, by the Rev. Edward Makeham, of the Chaplains’ Department, Commonwealth Military Forces, and late chaplain in the Royal Navy. I ask the indulgence of honorable senators while I read this letter, which appears to me to nut the case in a remarkably clear and able fashion. It is written by one who, both from his experience and calling, may safely be accepted as a competent and thoroughly reliable guide. The letter is as follows : -
With regard to the proposed abolition of canteens in barracks and military camps, may I be permitted to enter a plea for their continuance.
During 12^ years service in the Royal Navy, and nearly 15 as a Seamen’s Missionary and Harbour Chaplain, I have had abundant opportunity of noting the advantages and disadvantages of the canteen system, and have always found a properly conducted canteen conducive to good order and discipline.
The establishment of naval canteens at Malta, at the Naval Barracks at Sheerness, and on the guardship at Portsmouth, with each of which I was for a short time connected, considerably reduced the number of offences, especially leavebreaking, smuggling liquor, and breaking bounds; while on the other hand an endeavour to close the canteen at the Sailors’ Home in Hong Kong resulted in increased drunkenness and crime arising therefrom.
The establishment of a canteen places the sale of liquor under control ; the men themselves are also interested in the preservation of order - the canteen being at once closed if any breach of discipline occurs by the privileges being abused.
The absence of a canteen invites the establishment of public houses and grog shops in the vicinity of camps and barracks, and these places are, as a rule, not managed by the most desirable characters. There is also the sly grog seller to be taken into account - a class of occupation which always flourishes where total prohibition is established.
The Commonwealth Force, being a Citizen Force, is necessarily more free than the Imperial, but in this particular matter the conditions are not widely different.
The legislation proposed does not prohibit the use of intoxicants in camps, &c, but only the sale. It may naturally be expected then that men who are not total abstainers will take their own supplies of liquor into camp with them, a practice which, I think, would most certainly lead to grave trouble.
In the management of a canteen I would suggest that : -
Beer and wines of good quality be sold.
Temperance drinks, such as lemonade, ginger ale, &c, be always on sale.
The sale of spirits be strictly prohibited.
The President of the Canteen Committee be a commissioned officer not below the rank of captain.
All profits, after necessary working expenses are paid, to be devoted to the recreation or other fund for the benefit of the men.
That letter should arrest the attention, of those who desire to deal with this matter apart from any pledges. The case is stated with moderation, and the opinions expressed ought to weigh with honorable senators I desire now to give a few figures as to the relative percentage of drunkenness within barracks and forts, and amongst the general community. I do this because Senator Dobson, in dealing with the same figures some time ago, brought out results quite different from those I am forced to draw. I find, from a return placed on the table by the Minister of Defence, that the value of the drink consumed in all the canteens represents an average of £5 7s. nd. per head of the men. That, however, has tbe discounted, though to what extent I cannot say.
– To a very considerable extent discounted.
– At the foot of the return is a note stating that, in addition to the permanent troops attached to the barracks or forts, the members of the citizens’ forces, who attend parades, classes of instruction, and so forth, also use the canteens. It will be seen, therefore, that the average of 7s. nd. must be very largely reduced as applied to the members of the permanent forces only.
– It would be reduced to about per head, I suppose.
– It is no good supposing.
– There are hundreds of volunteers and others who attend drills, and so forth.
– How many times a year - two or three?
– I am not going to dogmatize on figures, but merely say that an allowance must be made. Whether that allowance should be is., ros., ox £1, noone can say, although we may be inclined to guess. The true figures could only be obtained by a very careful noting! of the number of casual visitors attending the barracks and forts. But I take the figures as they stand, and regard £5 7s- as representing the’ value of the liquor consumed per head by the men within the forts and barracks. In New South Wales the amount consumed per head within the barracks is ^4 3s. 6d. ; in Victoria, £7 os. yd. ; in Queensland, £7 5s. : in South Australia, ^3 os. rod. ; and in Western Australia, £12 6s. 8d. The average for the whole general population of the Commonwealth is ns. id. per head, and I find some difficulty in bribing the figures down to a common standard. It is generally accepted that we may take one adult male for every five of the population, but it would be unsafe to assume that all the ladies are teetotallers, and, therefore, it is impossible to say how much the adult males of the community do drink. If we take the adult males as one to five of the population, this means an expenditure of £1715s5d for every adult male in the Commonwealth. Honorable senators may reduce that amount as much as they think proper in consideration of drink supplied to those under twenty-one years of age, or to the females of the community. What I desire to show is that, subject to this allowance, while every adult male in the general community consumes drink to the value of £17 15s. 5d., the men inside barracks consume drink to the value of only £5 7s.11d. per head. While we cannot dogmatize as to the figures, we may safely draw the conclusion that the difference is so great as to justify us in assuming that men within barracks, as compared with the general population, are moderate drinkers.
– Hear, hear; very moderate !
– I should like now to draw attention to some figures relating to the arrests on the charge of drunkenness.
– Before the honorable senator leaves the figures he has just quoted, he ought to bear in mind that of thirtyseven drunkards, twenty-nine got drunk outside canteens. See what the honorable senator’s statistics are worth - not a dump !
– The fact is that twenty-nine men got drunk at those places which Senator Dobson would not prohibit, while only eight got drunk in the canteens which the honorable senator would prohibit. We have to remember, in a question of this kind, that there is remarkable difference between civil and military drunkenness.
– That is very wonderful !
– Senator Dobson will understand when I point out that while a civilian, though very drunk, is not interfered with as he walks along the street, so long as he is able to take care of himself, and does not annoy anybody, a soldier, if he shows the slightest sign of liquor within barracks, or when he is in uniform, he is looked after. It means that drunkenness, in a military sense, is much more serious than it is in a civil sense; and, therefore, the light percentage of arrests within barracks must be regarded as even lighter in reality than it would appear from a mere consideration of the figures. It is an unfortunate thing to have to say, but the charges of drunkenness dealt with by the Courts of the Commonwealth amount to 11.68 per1,000 of the population, which, assuming all those charged to be men, at the rate of one to five of the population, amounts to 581/2 per 1,000 men. Of course, an allowance may be made for the fact that some of those charged are our unfortunate sisters; but still, there are the figures. In connexion with canteens, however, I find that all the charges, even including those where the drink was got outside, amount to only 41 per 1,000; and if we have regard only to those who are charged with offences as the result of drink obtained at the canteens, the proportion is 9.3 per 1,000 as against 581/2 per 1,000 outside. All this seems to me to point to the fact that, as we cannot abolish liquor at the present stage of society - as it is generally admitted that prohibition would absolutely break down, and that we must rely on proper regulation and control: - it would be remarkably foolish for us as a Legislature, with those facts and figures before us, and unkind to the men themselves, if we abolished the canteen and left no place for. social meetings, and for the obtaining of moderate refreshments except those public houses, saloons, and dives which Senator Dobson has again and again affirmed are the real cause of the demoralization of the American Army. For those reasons, it is my intention to oppose the second reading of the Bill.
– I desire to say a word or two in support of the Bill. After having listened very carefully to the long speeches made in opposition to the measure, I ask myself what it is we desire to accomplish. To answer the question, we have first to ask ourselves whether canteens are a necessity. If the answer to the latter question be in the negative, why should canteens be allowed to exist, in so far as they are what may be termed grog shops. A great deal of argument has been culled from outside sources for the destruction of the efforts put forward in support of the Bill. It struck me that many of the arguments used by honorable senators had the, no doubt unintentional, effect of heaping anathema upon the head of our soldier. Whilst they have been endeavouring to defend the soldier, and certain so-called privileges, they seem to have forgotten the fact that they have been making the soldier out to be one of the most wretched creatures who can be found on God’s earth. They have been describing him as a veritable slave to his own appetites; as a man who, if liquor be placed within his easy reach, will become one of the most inebriate, disconsolate, disreputable beings of whom we can conceive. I am really astonished that any honorable senator should regard the person to whom, in certain circumstances, we are prepared to intrust the welfare of the nation, and upon whom we depend for its defence, as being absolutely impotent when it comes to a question of controlling his appetites. Surely if a man is not able to control himself in small things, the money that we spend in endeavouring to make him a defender of the nation might as well be thrown into the sea !
– Is not that an argument which could be used against closing publichouse bars?
– I do not think that my argument has anything to do with either the closing or the opening of public-house bars.
– But men are the same whether soldiers or otherwise !
– Yes, and when the opportunity arises I shall take a similar attitude in respect to publichouse bars.
– In order to be consistent, the honorable senator had better close the bar upstairs.
– I am prepared to do that. There is no one in the Chamber who is more anxious than I am to record his vote for the closing of the bar upstairs, for I always believe in setting my own house in order. I thought that I . had already indicated very clearly my view on that point. At the present moment, however^ we are dealing with a Bill, not for the abolition of the canteen, but for the abolition of the traffic in strong drink within the canteen. Surely there are a thousand-and-one attractions besides those of strong drink which may be introduced to the canteen. If the use of strong drink is calculated to benefit humanity, and to make pleasant out communications, social and otherwise, there ought to be a canteen at every man’s door or backyard.
– There is very nearly.
– I do not know whether there is or not. All I know is that the nearest canteen is at a considerable distance from my place. If strong drink is held up as an attraction to keep our soldiers under discipline, and within barracks, in order to perform their dutiesto their King and country, I am satisfied’ that we as a people have degenerated toa very great degree. I wonder what thesoldier will think of this.
– He has already stated what he thinks.
– I am half inclined to think that the soldier has not yet thought out the matter.
– He was asked the question, and he answered it.
– We know how questions are asked at times.
– In many cases he expressed arn opinion on the Bill before he was asked the question.
– In many cases the soldier may have expressed anopinion. But in his reflective moments he may say to himself, “ The legislators of the country are urging that, unless the canteen be upheld - unless we have at our command drink of every kind, in order that we may spend at the rate of £5 or a head per annum - we shall go outside the barracks and make beasts of ourselves. “
– Oh, no.
– Has not that been the drift of the argument in opposition to the Bill?
– No.
– Has it not been attempted to be shown that if thestrong drink were taken away from thesoldier in his canteen he would be drivento go outside for his liquor? There wasone honorable senator who went so far asto say that the abolition of the canteen would drive the soldiers into the drinkshops and the brothels surrounding the barracks, leaving us to draw the inference that the men whom we are training for the defence of the country are, when let loose, the basest members of the community. I am not prepared to admit that. I believethat a soldier has all the sterling qualities of manhood, and that he cannot be called1 a pig any more than can any one of us.
– Let him have his. drop of grog inside the barracks.
– In the same way the honorable senator might say, io respect of the whole of the community, “ Let the people have their drop of drink wherever they will.”
– So the)’ can.
– Then why <lo we regulate the traffic?
– We regulate the sale of drink in the canteen. It is also regulated outside.
– The regulation is illogical.
– Surely the honorable senator would allow a man to have bread.
– Most decidedly.
– We regulate the sale of bread bv law.
– Yes, by saying that a man shall only have what he pays for.
– There are other regulations.
– We say that a man shall have 2 lbs. or 4 lbs. of bread in his loaf.
– So far as New South Wales is concerned, the honorable senator us quite wrong, for we do more than that there.
– In what’ way is the sale of bread regulated in New South Wales?
– As to the hours within which it mav be sold.
– And the time within which it may be eaten?
– No; we have not gone quite so far as that.
– In Victoria we have a regulation as to the paper in which bread may be wrapped.
– In New South Wales do they allow a man the opportunity of stating .ali what (particular period he shall eat his bread ?
– Should the Labour Party get into power I believe that there us a probability that they will abolish even that amount of’ liberty.
– I do not (know that my party has ever had such an intention. I have always understood that it desired to get bread for men, whilst the party to which the honorable senator ^belongs does not care very much whether *nen get bread or not. According to the remark of the Minister of Defence, the regulation of the sale of liquor is illogical. If that it is a good thing for a man to have his beer or his whisky be logical, then let him have it when and in what, quantity he chooses. I regard a soldier as a man, too. He is, perhaps, under greater self-control than are many of us. His very training and environment teaches him self-control, and to conduct himself as a man should. A military member of the Senate gave, as an illustration, the conduct of the militia forces in the old country.Any man who is well posted must know that there a militia man has simply two; callings in life. One is to go to camp for twenty-one days in the year in order that he may drink the whole of that time, and the other is to rest entirely until the next? camp is held.
– Is that the honorable senator’s definition of a militia man ?
– In my time in the old country that was the type of man we had in our militia.
– They are better now.
– I do not know whether they are or not. I am simply stating the facts as they are known to me. In my time, there was not a scallawag who was not a member of the militia forces. Surely, we are not going to reduce the defenders of Australia to the standard of that militia ! On the contrary, are we not inclined to look upon our soldiers as reputable and respectable citizens who would be able, if called upon, to defend the country? The more opportunities we give to men to drink, and the more encouragement we give to debauchery, the less will be the possibility of getting that soldierly efficiency which is so essential to the defence of the country. I do not see any necessity for keeping liquor in the canteen. I do not suggest the withdrawal of any opportunities of recreation from the soldier. On the contrary, the canteens ought to be made attractive, and to provide for the edification and betterment of the men. I cannot believe, however, that the sale of whisky and other strong drinks is an essential to recreation or good behaviour. On the contrary, it degrades. It not only lessens the physical force of a man, but deadens his mental faculties. Its use has exactly the same effect upon a soldier as it has upon a civilian. We ought to do all in our power to prevent either soldier or civilian from becoming degenerate owing to the use of strong drink. Believing that the Bill would operate in the interests of the soldiers, especially of young men who are generally susceptible to evil influences, I shall support its second reading. I shall always be found voting on the side which goes for the abolition of the drink traffic and the betterment of mankind generally.
– This Bill is one that it is not easy to discuss temperately and moderately, as most measures that come before Parliament are discussed. It touches an article of consumption that we all agree is under some circumstances the cause of very great evil. Even moderate drinkers, as well as persons who abstain from drinking intoxicants, will agree that the question is surrounded with difficulties. I sympathize most heartily with the enthusiasm:, and, as has been expressed with some degree of justice, the intemperance, of the advocates of the Bill. I sympathize with it because there is great justification for it in the fact that very great evils do arise from the consumption pf intoxicating liquors, and because I believe that the bulk of the people who advocate their abolition are convinced that that abolition is possible, and that every attempt should be made to achieve it. Having said that much, however, I have to acknowledge that I feel that to abolish canteens while other facilities remain for the soldier to get drink, so far from being, conducive to greater sobriety on the part of the soldier, would rather tend to increase drunkenness, and would lead to a more baneful and pernicious form of drinking. My honorable friend, Senator Henderson, has delivered an address stimulated, I am sure, by a feeling of abhorrence at the very great evils that the drinking habit entails upon the people of all parts of the civilized world. But we have to deal with this matter as practical men from the experience which we have of life. We shall all agree that if drinking could be abolished in the ranks of our soldiers it would be very desirable to abolish it. But the question that we have to consider is whether by abolishing the canteen we should stop drinking or reduce drunkenness. I am inclined to think, and certainly experience, so far as we have had evidence, teaches, that to abolish the canteen, so far from abolishing or minimizing drinking will lead to a greater amount of drinking, and drinking of a more baneful character than that which now prevails. If that view be correct, even Senator Henderson, Senator Dobson, and those who feel with them, as I” Ho, must see that we ought not to adopt a course which “would create such results.
– Hear, hear; but we absolutely believe that the abolition of the canteen would reduce drinking.
– All experience proves the contrary.
– Absolutely no.
– I beg to assure the honorable senator that I feel as strongly as he does about the evils which follow from drinking, and agree that we should resort to every expedient to minimize it. But I consider that the expedient now proposed would not minimize, but increase, drinking. I have had an intimate acquaintance with aggregations of men in camps. I was for several years secretary of the Railway Workers’ Union - an asociation of navvies, as they are called, who construct railways, and whose work is mostly done in places remote from public- houses. I have always found that the worst drunkenness - that drunkenness which produces the most frenzied and insane acts on the part of those who become drunk - occurred in places the most remote from publichouses, where the law regulates the sale and the policeman exercises supervision. One Sunday morning I was in a camp where by law no liquor was permitted to be sold, and where, consequently, there was no regulation. I saw there no fewer than 53 fights - actually 106 men standing up to fight each other in a frenzied condition produced by drinking at a slygrog shop.
– Did the honorable senator count them?
– I. did. It was my business to be there as secretary. I need not tell honorable senators - they can easily realize - how horrified any selfrespecting man would feel at such a sight.
– Every new mining camp presents somewhat similar scenes.
– These men were no worse, I think, than ordinary rough labouring men usually are. I do not think they were more brutal than ordinary men. But they had no means, decently and orderly, of gratifying the passion which they possessed for strong drink. Means were presented to them indecently, and without any order, of obtaining drink of the worst/ and most maddening character. That was my experience in connexion with some 5,000 men. I do not wish to convey the impression that drunkenness was the general characteristic of them ; but it is the sort of drunkenness that prevails where there is no regulation. I have not the slightest doubt that if canteens were abolished, soldiers would become sly-grog sellers. That is not to say that they would become worse than ordinary citizens. Ordinary citizens, we know, wherever drink is attempted to be prohibited, become sly-grog sellers.
– That is saying very little for official regulation.
– But my honorable friend proposes to abolish official regulation.
– Oh, no !
– He proposes to abolish the canteen.
– To abolish strong drink, not discipline.
– If my honorable friends are going to make this a Bill to more rigidly control the drink traffic outside barracks and camps, they will receive my hearty support. But that is not what they propose- They propose to say merely that the soldier who wants’ to drink- the soldier who has just the same desire for drink” as the average citizen - shall be denied in his home the privileges that ordinary citizens have. The barracks are soldiers’ home, and this is a proposal to deny him the rights which ordinary citizens enjoy in their homes.
– The Bill deals not only with barracks, but with camps in the field.
– We are dealing particularly with permanent canteens.
– Not necessarily.
– The field is the soldier’s home when he is in camp. I believe that the preponderating opinion of scientific men and decent citizens is that, under reasonable conditions, without undue or abusive use, strong drink is, to some people, a comfort and an advantage. Our soldiers being drawn from the ranks of ordinary citizens, possess, in just’ about the same percentage as do people outside barracks, that desire for drink. Until we are prepared to control more rigidly or to abolish absolutely the use of alcohol, both inside and outside barracks and camps, we shall not be acting logically or fairly tto our soldiers if we impose restrictions upon them which we are not prepared to impose upon ourselves and upon other citizens. I have no hesitation in saving that if I believed for a moment that the abolition of canteens would lead to increased sobriety on the part of soldiers I should be prepared to vote for their abolition. But I am as; confident from my experience as I can possibly be that the abolition of the canteen would not lessen drinking amongst our soldiers, but would lead to a kind of drinking that would be more baneful to them.
– That is a bad argument. It lowers the soldier terribly.
– It does not lower the soldier any more than it lowers the ordinary citizen. The soldier is; indeed, only an ordinary citizen, except that in some respects, he is a little bit better. He is, for instance, selected because of his physical health and fitness. What I am urging is that in connexion with ordinary citizens whether there is regulation or no regulation, there is drinking ; and where there is drinking without regulation, experience teaches us that it is more baneful than where it exists with regulation. I had a curious experience in New Zealand, where I travelled for seven weeks a few years ago. I travelled with a gentleman whose duty is was to accompany a Commission to which I had been appointed. He was a very fine fellow indeed. He was always, as we all were, sober, until we struck a prohibition section of New Zealand. Then I never saw a man more drunk in my life than he was. On the Cheviot estate, which was a prohibition area, we could not get drink, so the law said; but nevertheless. I never saw a man more drunk than this man was. Possibly it was an accident - possibly a constitutional defect asserted itself over him just at that time. But still, there was the fact.
– Does not the honorable senator know that in the prohibition districts crime and drunkenness have decreased ?
– I will tell the honorable senator what I also know - tha’ recently the late lamented_ Richard Seddon proposed, in connexion with the prohibition law of New Zealand, to make it an offence anywhere in that country for any person to be found with drink on his premises. But the prohibitionists objected to that. Those who wanted to prevent the “other fellow “ from drinking would not support the proposal. Yet the logica! issue of prohibition is that no one should be allowed to drink anywhere within the prohibition area, and that any oone found with drink in his possession shall be guilty of an offence.
– That is no argument, seeing that it is proved that prohibition makes for sobriety and lessens crime.
– I quite agree with the honorable senator in that. But I believe that the abolition of the canteen would not prohibit drinking among our soldiers. It would go on just the same, unless it was made an offence for a soldier to have drink in his quarters. Without such a regulation, merely to abolish the canteen would be to aggravate an evil, which would be very much greater than the drinking evil which at present is alleged to prevail. Probably drinking would prevail to a greater extent than it does now, but it would be of a very much more harmful character, and would take place under conditions where the same supervision could not be exercised, as is the case when liquor is consumed at the canteen. For these reasons, I shall vote against the second reading, of the Bill.
– Why not vote for the second reading, and put in the Bill in Committee what the Minister says that he is prepared to consent to?
– I think that the proposal is evil in its essence. The Bill is wrong in principle, because it imposes upon the soldier a disability that honorable senators are not prepared to impose upon the ordinary citizen.
– The Minister proposes to prohibit the sale of spirits in the canteen.
– I do not know what the Minister has proposed to do. I have always been a local optionist. I believe that it is a proper democratic principle that the majority should rule. If the majority of the soldiers in a barracks, or the majority in a camp said, . “ We think that it is baneful to permit the sale of liquor within the precincts of our camp,” they should have the right to expel it. But I think it is wrong of us to impose upon soldiers a disability that we are not prepared to impose upon ourselves. The whole proposal is illogical; and even if it were logical, it is not calculated to produce the result that is aimed at.
– I think that it is the duty and the desire of all of us to minimise intemperance in every reasonable way. I am quite prepared to admit that those who are opposing the abolition of canteens are desirous of seeing that result achieved. At the same time, I believe that to remove the temptation is always a good way to minimize an evil. Both in my legislative and administrative career, I haveon every opportunity endeavoured to reduce the opportunities to indulge in drink, which I regard as one of the greatest curses under which the people of Australia suffer. It has been proved that where opportunities to drink have been reduced, decrease of intemperance has been a natural corollary.
– That is not the experience of those who know anything about the matter.
– I am of a contrary opinion. Opportunityto do wrong often results in wrong, and we know that Shakespeare says -
How oft the sight of means to do ill deeds
Makes ill deeds done !
Senator Millen twitted Senator Dobson with advocating the saloon and opposing the canteen - with advocating a “pub” outside, and opposing a “pub” inside. It would be equally fair, or equally unfair, to charge Senator Millen with advocating a “ pub” both inside and outside. There is no doubt that canteens afford opportunities to drink during hours of duty ; and that brings me to the contention that a canteen is on a very different footing from an hotel . An hotel is usually availed of by people after office or business hours, whereas the canteen is open to the soldier during the time he is actually engaged in his professional duties.
– Are canteens open all day?
– No.
– Canteens are practically open the whole time.
– They are open only at stated hours.
Senator STANIFORTH SMITH.But they are open during the time the soldiers are on duty.
– I do not say that is not so; but canteens are open only at stated hours.
– Are people engaged in industrial organizations granted the privilege of canteens?
– The honorable senator had better go and see the canteen at the Melbourne Argus office.
Senator STANIFORTH SMITH.Is it usual to allow canteens on premises where industrial operations are carried on?
– People do not live, and sleep and make their homes on industrial premises.
Senator STANIFORTH SMITH.What I say is that canteens where liquor is sold are open to the soldier during his (business or professional hours, whereas a similar privilege is very infrequent on industrial premises. Why should we not allow the members of the civil branch of the Public Service - say those engaged at the Treasury Buildings - to have a canteen?
– The Treasury Buildings are not the home of the public servants.
Senator STANIFORTH SMITH.In my opinion, the cases are quite parallel. In the camp and in the field, canteens are allowed; and there seems to be no reason, if that be so, why there should not be canteens for the civil branch of the Public Service during business hours.
– The civil servants are not then at their homes.
– The camp or the field is not the home of the soldier.
– Yes, it is, for the time being.
– Why not have a canteen for the Australian Navy.
– The number of the members of the Naval Forces is too small to support a canteen.
Senator STANIFORTH SMITH.Why should there not be canteens in factories or foundries? If residence is to be the great justification of canteens, why is there not a canteen for the police or for the fire brigade? “
– Because all the constables do not live at the police barracks.
Senator STANIFORTH SMITH.Neither do all the soldiers live in barracks.
– All unmarried constables live in the police barracks.
– Is Senator Smith quite sure that the police have not canteens ?
Senator STANIFORTH SMITH.I am quite sure. I am not advocating the abolition of canteens, but only the abolition of the sale of intoxicating liquors at canteens. As a matter of fact, in the canteen soldiers are granted a privilege which is denied to the whole industrial army - which is denied to other branches of the Public Service, including the police and the fire brigade. This Bill, instead of proposing to put soldiers on a different footing from that of other citizens, really proposes to put them on exactly the same footing. In the United States, where there is a population of 80,000,000 people, canteens have been abolished, and on this point we have had ‘a great deal of evidence, for and against, quoted to us by Senators Turley and Dobson. What those honorable senators quoted were individual opinions expressed by people who have had an opportunity to observe the conditions both before and after the abolition of canteens in the United States.
– There is not much evidence as to the conditions after the abolition of canteens.
Senator STANIFORTH SMITH.There has been a great deal of evidence as to the conditions which prevailed after, and while canteens were in existence.
– There was less drunkenness in the Army in the United States while canteens were in existence than there is to-day.
– The supreme fact overlooked is that the Go vernment of the United States, which must have the best interests of the Army at heart, has decided to continue canteens without the sale of liquor, and I know of no popular proposal to re-establish the sale. The opinions which have been quoted to us are nothing when compared with the opinion of the whole 80,000,000 people of the United States, as expressed by the Legislature, which denies soldiers the so-called privilege of being able to obtain intoxicating drink during military hours.
– The soldier’s hours are twenty-four a day, chough he may be actually on duty only three or four hours.
Senator STANIFORTH SMITH.And while the soldier is on duty the canteen is open.
– But the soldier cannot leave his duty and go to the canteen.
Senator STANIFORTH SMITH.Members of fire brigades are on duty twenty-four hours in the day, and yet they have no canteen.
– The members of fire brigades are very few in number, as compared with soldiers.
– At the head fire-station, Eastern Hill, Melbourne, men have to be on duty at all times, and the principle is exactly the same as” that which applies to soldiers. The American people are not likely to be carried away by fads, and yet they have decided to abolish drink at canteens.
– That must have been done just before an election.
– Whether that be so or not, drink is still abolished at military canteens in the United States, and there is no organized opposition to the present conditions.
– In England canteens have not been abolished.
– The English people are admittedly slow to do away with abuses - they are exceedingly conservative in regard to their institutions. If we are to mould our legislation on that of Great Britain, there is no occasion for an Australian Parliament. When the referendum was taken amongst the soldiers, I believe the question put to them was whether or not they were in favour of the “abolition of canteens.”
– No.
– It was so stated in the press; and I believe that many of the soldiers voted against the abolition of drink with the idea that they were voting against the abolition of the canteen, which is, as we all know, a sort of military store.
– That was not so. Does the honorable senator propose another referendum?
– This Parliament is here on a referendum of the people, who gave us plenary power to make laws. The Minister of Defence does not appear to quite understand what local option is. It does not mean handing over the whole power to a few persons engaged in one industry or profession, but it means the consent of the whole people.
– Local option is applied in districts.
– Do we offer local option to the Public Service as to whether they shall establish a canteen? What this Bill proposes is to give soldiers the same rights and privileges as are enjoyed by ordinary citizens ; and if the soldiers at Queenscliff want all, or any, of the hotels there abolished, they have equal voting and local- option power with the rest of the community. The question is whether soldiers shall be allowed to obtain liquor inside barracks and camps during professional hours. My own opinion is that we should not propose to abolish canteens unless we are prepared also to abolish the canteen in Parliament House. The refreshment bar here is open s during our professional or legislative hours, and I am quite prepared to support the abolition of the sale of drink here. We should be placed on the same footing as that on which it is proposed to place the soldiers. If the refreshment bar were closed, members of Parliament, like the soldiers, would not be denied the right to obtain refreshment outside.
– Is the honorable senator prepared to allow the soldiers to say whether or not the parliamentary bar shall be closed?
– I never heard such a ridiculous suggestion in all my life !
– The honorable senator is proposing to abolish the bar in barracks.
– We are here to make laws, while the soldiers are there to defend the country. We are empowered by the Constitution to legislate, and we are acting within our rights in dealing with canteens, which, allowed by law, may be abolished bf law. I am quite prepared to credit the opponents of the Bill with intentions equally as good as those which I entertain, but I have always adopted the plan of_reducing opportunities to drink wherever possible. When I was a member of the Licensing Bench on the Western Australian gold-fields, I did everything I could to prevent the granting of fresh licences, and during my tenure of office scarcely an additional licence came into existence. As the dinner hour has now arrived, I ask leave to continue my remarks on a future occasion.
– I think that no honorable senator, under such circumstances, ought to be granted or not granted permission to continue his remarks at the dictum of any one honorable senator. If I put the question whether Senator Smith be permitted to continue his remarks any honorable senator may object, and I do not’ think that is fair when a speech is interrupted by ordinary business arrangements of the Senate. I have thought over this matter for some time, and I propose now, and in the future, not to ask the Senate to grant leave to an honorable senator to continue his speech when that speech is interrupted by the dinner hour. I now rule that Senator Smith may continue his speech without asking for leave when the debate is resumed.
Debate adjourned.
Sitting suspended from 6.30 to 7.45 p.m.
page 3285
In Committee (Consideration resumed from 22nd August, vide page 3178):
Clause 4 -
Any person who, either as principal or as agent, makes or enters into any contract, or is or continues to be a member of or engages in any combination, in relation to trade or commerce with other countries or among the States- -
with intent to restrain trade or commerce to the detriment of the public ; or
with intent to destroy or injure by means of unfair competition any Australian industry, the preservation of which is advantageous to the Commonwealth, having due regard to the interests of producers, workers, and consumers, is guilty of an offence.
Penalty : Five hundred pounds.
Every contract made or entered into in contravention of this section shall be absolutely illegal and void.
Upon which Senator Sir Josiah Symon had moved by way of amendment -
That after the word “contract,” line 18, the word “ hereafter “ be inserted.
– I really forget for the moment whether Senator Keating said that the Government were going to accept the amendment or not.
– We prefer the wording of the clause as it is.
– Surely there cannot be any harm in putting in the word “ hereafter.” I fail to see how it would be possible for a contract to be made in contravention of an Act which did not exist, so that the clause must refer to future contracts.
-If so, what necessity is there to put in the word “ hereafter “ ?
– To make certain that it does refer to future contracts.
– I would appeal to the Minister to accept the amendment which has been moved with a genuine desire to improve the Bill. On his own showing, it would appear that it is intended that the clause shall only apply to agreements made after the passing of the Bill. If that is the intention, and there is a feeling on this side that it is not expressed with sufficient clearness, it seems most unreasonable that he should resist an amendment which he admits will do no harm.
– Cannot my honorable friends accept our statement that that is really what is intended?
– It is not a question of doubting the Minister’s word. The words in question have been interpreted in two ways, and the only desire is to properly express our intention that the Bill shall apply to only future agreements. Even admiting that the Minister is right in his interpretation of the words, he will not be made wrong by accepting the amendment.
– In the various States there is a strong and widespread fear that existing arrangements may be brought under the operation of the clause.
– If they are continued, undoubtedly they will.
– If I mistake not, Senator Trenwith dealt with this point a few days ago, and elaborated the desirability of allaying such apprehensions. If the Government, however, deliberately refuse to accept a very simple amendment, which would make our intention quite clear, the public can only form their own conclusions on the point. I hope that the Minister will not refuse any longer to accept so simple a solution of the difficulty.
– I should be only too glad to accept the amendment if I were perfectly satisfied that it would not cause difficulty. It is not easy, to say, when we alter the wording of a clause, whether the effect will be exactly what we expect. We all know that the members of the legal profession are so subtle, that they can twist a provision in all sorts of directions. As I understand the clause, it means that in the case of a contract entered into before the passing of the Act, a person will not be liable to any retrospective pains or penalties if it is in contravention of the Act.
– We only want to make that clear.
– I think itis clear. The clause goes on to provide that every contract made or entered into in contravention of this section shall be absolutely illegal and void. I do not know whether, if we inserted the word “ hereafter,” it might not in some way conflict with the first part of the clause. It might in some way limit the power which is there given, and I do not want that to be done.
I am afraid that if the amendment were made, it might be argued that it would give persons a loop-hole for saying that the provision could only apply to contracts made after the passing of the Act. What we say is that we will not punish men for having entered into a contract which is made illegal by the clause, but if we make the amendment, we may really say that contracts hereafter made may continue to run for ever. I think that there is an element of danger attached to the amendment. In matters of legal interpretation, I have to trust to my honorable colleague, who is a lawyer. He informs me that there is a slight danger in making the amendment, and he would prefer that the clause should stand as it is.
– We have to look at what the clause proposes to do, in order to understand whether contracts made in contravention of it would be affected. The first part of theclause says that the making of a contract with intent to injure an Australian industry is a punishable offence. It must be done in contravention of the Act, and when it is so done, the offender is punishable with a fine of£500.
– Suppose that extensive contracts have been entered into during, the discussion on the Bill?
– The object of the clause is to punish offenders who make contracts in contravention of it. Obviously, a man cannot make a contract in contravention of a clause before it is enacted. The clause goes on to provide that a contract made or entered into in contravention of it shall be null and void. Clearly, it cannot have any reference to a contract now existing, and consequently to a contract which was not made in contravention of it.
– Why not put in the word “ hereafter”?
– I have received a string of amendments which have been suggested’. It is proposed, for instance, to put the word “wilful” before the word “ intent.” Would it not be absurd to make that amendment, because the intent must be wilful? To insert the word “hereafter” in this clause is obviously unnecessary, because the object is to provide a punishment for the offence of making a contract in contravention of it, and then to declare that the contract so made - not any other contract - shallbe null and void. Clearly it must be a contract made after the pro vision had come into force, or it could not be a contract “ made or entered into” in contravention of it.
– If the statement of Senator Trenwith be correct, it follows that the difficulty foreseen by the Minister will arise. If, as Senator Trenwith affirms, the clause would only be operative in respect of an agreement made after the passing of the Act, then the contention of the Minister that an agreement made prior to the passing of the Act could not continue to run its whole course must fall to the ground. Suppose that twelve months ago an agreement was made for a period of seven years. According to Senator Trenwith, it would not come within the scope of the Act.
– If a man continues to be a member of a combination he would.
– Does the Committee desire to have in the Bill a clause which would allow a contract of that kind to run its full term or not, or does it agree with Senator Trenwith that all existing contracts should be allowed to continue, irrespective of the passing of the Bill? Here we have from two laymen two different readings of the clause.Could a stronger argument be required as to the necessity for revising its wording ? Suppose that the clause is passed as it is, and that there is in existence an agreement which was entered into before the Bill became law, and which contains a condition that certain payments shall be made. If, as the Minister contends, an existing agreement would come within the four corners of the Act, then it seems to me that one party to that agreement could decline to make his payments, on the ground that it had been rendered null and void by the passing of the Act. Surely it is not desired to draw a knife across existing business arrangements ? .
– No. That would only happen if he did something with intent to restrain trade or to destroy an Australian industry.
– It ought to be made abundantly clear whether the clause will allow existing contracts to continue indefinitely or not. In the circumstances, I think that the clause should be amended in order to remove all doubt on the point, or, failing that, there should be an assurance from the Minister that an opportunity will be given later on, after he has consulted with his colleagues or advisers, to reconsider the point.
.- I think that honorable senators have confused two things in the clause. It first creates the offence of making or entering into- a contract, and then it goes on to say that if any person commits the offence of making a contract in contravention of the section, or continues to be a member of a combi’nation, the contract shall be null and void. I feel perfectly clear that that cannot possibly refer to a contract made before the passing of this Bill. Therefore, it is not necessary to insert the word “ hereafter.” If it is the intention of the Minister that contracts already made which are in conflict with this measure shall be illegal, he will have to state that specifically in the Bill. I feel quite certain that the measure would not be so in terpreted bv a Court, as it stands at present.
– It seems to me that Senator Trenwith^ argument is very good so far as it goes, but still, I cannot see any harm in putting in the word “hereafter.” What objection can there be to make assurance doubly sure?
.– I may point out that sub-clause 2 does not refer to a person at all. It only refers to a contract, and apparently has reference to the contract dealt with in sub-clause 1. As I previously pointed out, it. appears to me that a contract could not be made in contravention of an Act which did’ not exist. Therefore, a contract made in the future must be referred fo. But seeing that the Minister thinks that a contract made before the passage of the Bill might be voided, it is surely only prudent to insert a word to make it perfectly sure that the interpretation of the clause shall be that which the Senate desires to put upon it. The suggestion to insert the word “ wilful “ before “ intent “ affords no reason why we should not insert another word which is obviously necessary to prevent a misunderstanding. There is a difference of opinion, as to whether the clause as it stands is retrospective or not. Surely it is better to clear up the matter by inserting “hereafter.” That would make it quite clear that contracts made before the passing of the Bill would not be voided.
– I am confirmed in my impression of the desirableness of this amendment by noting the exact’ terms used by Senator Trenwith in his secondreading speech. He said, after making it clear that he himself was satisfied with the clause -
Speaking for myself, I have no doubt at all on the subject. It is perfectly clear to me that under no circumstances can this Bil] affect agreements entered into before it is passed1, lt is quite impossible that such agreements could have been made in contravention of a section of an Act which had no existence. Still I think the Minister of Defence would be wise if, by some statement or other, he were to make that per- . ffectly clear to the public mind, so that those who are now nervous on the matter shall be reassured.
– The Attorney-General stated that in another place.
– I think that the Min.ister of Defence should state it also in the Senate, and in terms as definite as they can possibly be made. It cannot be made too clear. Many persons are nervous and anxious on the subject, and it is as well that their minds should be relieved.
After arguing further on the clause, he finished up with this remark: -
I am not now endeavouring so much to reply to objections raised in the Senate, as to remove anxiety which I know to exist in the minds of individuals outside with reference to the possible operation of this measure.
With those words before us, from, perhaps, the warmest supporter of the Bill in the Senate, how can we hesitate to urge the Government to adopt this very simple amendment ?
– I hope that the Committee will not insert the word “hereafter.” I am satisfied that it will merely create a loophole around which the legal men will cluster. I have given a good deal of consideration to this point, because, like Senator Trenwith, I was approached by persons who thought they were interested in having the point made as definite as possible. Even if it were desirable to insert any words to carry out Senator Pulsford’s idea, the word “ hereafter “ is pot the best one to employ. The words “ after the passing of this Act “ are usually employed to express what he desires. “ Hereafter “ is an indefinite term, and would probably lead to a great deal of argument by clever gentlemen of the legal profession. But it is not necessary even to insert “ after the passing of this Act,” because the meaning is so obvious on the face of the clause. Even if the Minister of Defence did “make a statement to the contrary, he was, as he would say, “caught on the hop,” and had not fully considered the meaning of the clause.
Would it not be a peculiar thing in passing a Bill dealing with the criminal law to say “ after the passing of this Act no one shall commit a murder “ ? The clause is quite clear and definite, and any one who reads it must recognise what is meant. Honorable senators opposite have on several occasions attempted to strike out words from Bills that were no less objectionable, or, indeed, more objectionable than the word “ hereafter “ would be in this clause. In the one case, they wish to strike out a word, and in another case to insert a word, just, it appears, for the purpose of altering the Bill without affecting the meaning in the least degree.
– It is undesirable that the deliberations of this Committee should be assailed with the imputation that amendments are made merely for the purpose of inserting or striking out a word without desiring to affect the meaning of the Bill. The discussion that has already taken place furnishes a complete answer to Senator McGregor. The fact that there is a wide difference of opinion even amongst those who support the Bill as to what the1 clause means is ample justification for the discussion. If we are going to have such suggestions they will not be likely to tend to the smooth progress of our work, or to the speedy passage of legislation. Nothing has been said or do,ne by honorable senators on this side of the Chamber that gives the slightest warrant for the suggestion that we are animated bv any other desire than to make the Bill as workable as possible. It is in that spirit that I have acted, and I sincerely regret that the Minister has not accepted the amendment.
– A number of honorable senators during the second-reading debate said that they supported the Bill because they thought it would have, the effect of dealing with trusts and would prevent dumping, though the opinion was expressed that . it would be unsuccessful in that respect. I feel quite sure that the measure will be wholly unsuccessful if the word “ hereafter “ is inserted. Suppose that to-morrow,’ as the result of this discussion, an agent for foreign firms entered into a large contract, extending over many years, with the result of flooding the Australian market with a particular kind of machinery for the next twenty years. It might be possible under the dumping clauses to deal with such a contract ; but it is now proposed to insert a word that would enable such a thing to be done. I hope that the Senate will reject the amendment, feeling certain that it would entirely annul any good that the clause might do, or any good that the anti-dumping clauses might effect.
– Surely honorable senators will not be misled bv a suggestion so ridiculous as that made by Senator Croft. Dumping is a business of a spasmodic character, and no one would dream of entering into an arrangement for dumping goods and losing money on them for twenty years. The suggestion is absurd.
– Does the honorable senator mean to say that warehouses do not make their contracts years ahead?
– No one would dream of contracting to lose money twenty years ahead. There is no reason to fear that a ridiculous contract of that kind will be made.
– I can quite understand a member of the Committee who is disposed to think that the clause ought to be retrospective opposing this amendment, but I cannot understand a senator who does not adopt that view objecting to the insertion of a word which makes it perfectly clear to what extent the clause will operate. It may be urged, and I suppose it has been urged, that the insertion of the word “ hereafter “ is unnecessary, and that the clause as it stands is quite sufficient. I can quite understand a lawyer - if honorable senators can find such a man - who thought it desirable that Acts of Parliament should be passed containing provisions so ambiguous and doubtful in their meaning that they would give him an opportunity of getting some work, voting for such a provision. That, I think, would be the result if this clause were allowed to remain as it stands. Putting my own personal interpretation upon it, I should say that it is extremely likely that it will have a retrospective effect. I understand that Senator Playford has expressed the same view. I do not wonder at any man, applying the light of common sense to the clause, saying that it is possible that it may be retrospective. Whether it is desirable to make it retrospective or not, is a different question. But if there are members of the Committee who think that it ought not to be retrospective, I should say that we, as a revising chamber, if we are nothing else, should insert words to make our meaning, perfectly clear. Even if we do make the clause slightly redundant, it is better to do that than to let it remain ambiguous. It is better to express in the clearest language exactly what we mean, even if we have to put iti one additional word in about 100, than to allow a clause to go the meaning of which is doubtful. Because, after all, the insertion of the word “ hereafter “ would not add very much to a clause of this length. It is very undesirable that we should pass a clause which has a retrospective effect. I shall certainly support the amendment, or some such amendment. Whether we insert the word “hereafter” or whether - if we wish to make the phraseology uniform - we adopt words which I notice are fairly common in this Bill, and say ,r after the commencement of this Act,” is not material. At any rate, “ hereafter ‘ ‘ means the same thing.
– Personally, I see no harm in the word “ hereafter,” but I have had an opportunity of consulting the Attorney-General, and he thinks that it would be redundant, that there is no necessity for it. He would prefer that the clause should passi as it stands. In his opinion, the x clause is sufficiently clear. If honorable senators turn to clause 10 they will see that the point is made abundantly plain by the words “ after the commencement of this Act.”
Senator PEARCE (Western Australia) £8.26]. - If this legislation is to be effective it must not be of the “ kid glove “ variety. The United States legislation is certainly not of that description, because, in some cases, special Acts have been passed to meet contracts in existence. We should make up our minds that if we pass the Bill it shall be in such a form as to deal with existing contracts. The Bill practically says that a combination in restraint of trade is illegal, and in Australia to-day there are such combinations by virtue of contracts or agreements. Are we to allow those contracts to remain in perpetuity, and thus create a favoured section, because it has been clever enough to commence operations before the passing of the Bill ?
– The amendment would not prevent such persons being reached.
– But if the word “ hereafter “. be inserted it will place be yond the scope of the clause every combination in restraint of trade now in existence in the Commonwealth. The first part of the clause defines1 the scope, and then states the crime and provides the penalty. Sub-clause 2 thereupon declares that every contract - that is every contract which involves an offence - is illegal ; not only punishable, but illegal.
– And yet the honorable senator has heard the Minister say that “hereafter” is redundant.
– Yes. I do not think that this anti-trust legislation will be veryeffective in any case, but it will be a farce if we recognise existing combinations, which have their force by virtue of contracts. What is the secret of the power of the Standard Oil Company in Australia to-day, but the numerous contracts with grocers, who have bound themselves, in order to get an advantage, to take only the oil of that company for a certain length of time? Are those contracts to be allowed to continue?
– They certainly will continue, whether we put in ‘’ hereafter “ or not, unless it be proved that they were entered into with a design to destroy an Australian industry.
– The contracts I mention have a design to destroy the only industry opposed to the Standard Oil Company. One of the other oil companies import their oil in bulk, and the tinning and casing is an Australian industry, which is fast being destroyed by means of the rebates and contracts of the Standard Oil Company.
– The position which the honorable senator is stating now will not be altered whether “ hereafter “ is inserted or not.
– My reading of the clause is that on the passing of the Bill all contracts in restraint of trade, which come within clause 4, become illegal and void.
– Even if they have been made before the passing of the Bill?
– Either before or after. The Bill, in my opinion, is introduced for the purpose of breaking up combinations in restraint of trade. If a combination be a crime, is the Bill not intended to put an end to it, as well as to provide against similar combinations in the future?
– Surely there can be no doubt about that.
– But honorable senators opposite are urging that “hereafter” should be inserted in order that those contracts may be allowed to continue.
– The idea is that the Bill shall not be retrospective in regard to punishment.
– The punishment is provided for in another part of the clause, which goes on to provide that any such contract shall be null and void. Almost every grocer, I suppose, in Western Australia is trading under a contract with the Colonial Sugar Refining Company.
– There is no contract.
– The honorable senator is speaking without authority, because there is an agreement.
– Which can be broken at any moment.
– Yes; on the grocer forfeiting the amount of the rebate.
– That is very trifling. There is no contract,
– It is not trifling, because, in some cases, the rebate amounts to upwards of £100.
– There is no contract.
– A grocer showed me an agreement, which to me, as a layman, appeared very like a contract ; at any rate, it is an agreement not to take the sugar of any other producer under a penalty of forfeiture of the rebateheld by the company. I hope the Minister will not agree to the amendment.
– I agree largely with what Senator Pearce has said, but I point out that, even if “ hereafter “ is inserted, all the honorable senator’s objections are adequately met by the first part of the clause, which provides the very adequate penalty of £500. If there were a contract in existence at the present time, and an act was being committed under it in violation of paragraphs a and b of sub-clause 1 the penalty would still remain, no matter what words we may insert in sub-clause 2 ; and what Senator Pearce fears could not happen. But there is a difference between declaring such a contract absolutely illegal and void as to every single part of it, and removing an offence because it is committed under an existing contract. I think the penalty ought to remain, butwego too far if we destroy every part of an existing, contract, even a part which may be perfectly fair and square as between the parties.
– The clause refers only to what is done in contravention of the Bill.
– That does not so appear from the wording of sub-clause 2, according to which, if any part of a contract is in contravention of the clause, the whole of that contract becomes illegal and’ void. We must recognise that there maybe many parts of a contract with which we should not want to interfere; and any part that is in contravention of the clause is met by the adequate penalty of £500. Senator Pearce, in his anxiety to make it perfectly certain that no contract in contravention of the clause shall continue, goes too far, because he wants to destroy the whole of the good part of a contract, such as we would be perfectly willing to allow two citizens, to enter into.
– A contract is only affected by the Bill if it is in contravention of paragraphs a and b of sub-clause 1.
– If sub-clause 2 remains as at present, every part of any contract made in the past will be made null and void, whereas only a part of it may constitute an offence.
– Why not insert some qualifying words making sub-clause 2 apply only to such contracts as are in contravention of the section?
– Any words of that sort would suit me, but I do not think it is necessary to make null and void every contract entered into, it may be years or months before, simply in order to make sure that there shall be no contravention of the measure.
– I think Senator Pearce is wrong; in imagining that the existence of a contract would be a defence in the event of a person being charged under the Bill. Such a contract would be no defence.
– I do not take the view that it would.
– Senator Pearce assumes that people will go on committing offences right and left under existing contracts.
– What I said was that an existing contract might continue, although fresh contracts could not be entered into if in contravention of the section.
– An existing, contract would not be a defence in the case of an injunction. ,
– I never said it would.
– An injunction would toe sought to meet a certain case, but it would not necessarily void the contract. It is not wise to pass legislation making void a whole lot of contracts entered into previously. No one would know until a case came into Court whether a particular contract was void or not. Senator Millen presented a very strong illustration when he spoke of an agreement for the hire of machinery. Would Senator Pearce say that, in such a case, the hirer should be relieved of all obligation to take care of the machinery, pay rent for it, and hand it over at a certain time, or at the expiration of the contract ?
– There is need for other words to meet such a case, but not the word “ hereafter.”
– We ought not to make previous contracts illegal, but provide that if anything illegal is done under them, it may be rectified , or persons punished. It is quite right and proper to declare that all contracts of the kind, made after the passing of the Bill, shall be illegal and void; but clearly previous contracts should not be made illegal by subsequent legislation.
– -Sub-clause 2 only refers to contracts under which an offence has been committed.
– I think that if the word “ so “ were inserted between “ contract “ and “ made,” the sub-clause would be perfectly clear, showing as it would that the contract referred to was a contract contemplated by the first part of the clause.
– Surely that amounts to the same thing.
– I raised no difficulty in regard to sub-clause 2 until we heard so many speeches indicating that there is an intention to make it retrospective.
– Not at ‘all; it is not proposed to punish a man for anything done before the passing of the Bill.
– The Minister clearly told us that, in his opinion, if anything in a contract made before the passing of the Bill was found to be in contravention of the Bill the contract would be void. Other honorable senators have expressed themselves very strongly in favour of making it clear that it is intended that the Bill shall have retrospective operation. Those honorable senators are, I think, under a mistaken idea that if such contracts are not made void offences may be committed with impunity. I speak subject to the opinions of others, but I do not think that the existence of a contract would be any excuse for an offence. We should be very careful not to make void previous contracts, because we do not know to what extent we may be interfering with the rights of perfectly innocent persons.
– I do not think there is any intention on the part of any honorable senator to make the provisions of this Bill retrospective ; and by “ retrospective “ I wish to convey the ordinary meaning of the word, namely, that a man shall not be punished under this Bill for any act which prior to its passing, was not an offence. I understand that the Bill is to apply to all existing contracts, and that the moment it passes those contracts which are in any way in contravention of its provisions will become illegal and void.
– Contracts made before the passing of the Bill?
– It does not matter when the contracts were made; the Bill clearly applies to all contracts which are in existence when it becomes an operative factor in our legislation. If that were not so the Bill would be valueless. If we insert the word “ hereafter,” I am inclined to think that an existing contract would become a defence, and a tower of defence, in case of a charge being laid under the Bill, because the word would indicate that what was intended were contracts made after the passing of the measure. If, prior to the passing of a Bill, contracts were made which were bad and calculated to be injurious to Australian industries, then the word “hereafter,” if inserted, would clearly perpetuate them. I hope that the Minister will adhere to the wording of the clause, because if the alteration were made, the danger of w’hich Senator Drake spoke, might become an obstacle to the true application of the legislation.
.- It appears to me that the sub-clause ought to read in this way -
Every contract, whether entered into before or after the passing of the Act in contravention of the Act shall be void so far as it is in contravention of the Act.
That would leave all other parts of the contract in full force and effect. We all know that there are not many trusts carrying on business in Australia. Suppose that in Australia there are two or three trusts, and that at this moment they have contracts with dozens of citizens, which tend to fix and regulate prices, and thereby stop free competition. Are we to pass a measure to regulate and control trusts, and, at the same time, to leave all those contracts absolutely sound and legal? I quite understand that a contract will not save a man from the illegality which he commits. If our desire is to put an end to trusts which do restrain trade and stop competition, why cannot we say that every contract which has that effect shall be void ?
– Because there is no necessity. The first part of the clause deals most effectively with all those persons.
– That is where the argument of Senator Drake comes in.
– As a matter of common law, every contract which is in unreasonable restraint of trade is bad.
– But we are saving contracts which are made before the commencement of the Act.
SenatorPlayford. - We do not save them if they are made in contravention.
– I should like Senator Keating to tell us what the Government think that the clause does mean.
– Ifany honorable senators wish to save existing contracts, so far as they are legal after the passing of the Act, what is really required is to add to the subclause the words “ so far as they are in contravention of this section.”
– That is understood without putting it in.
– What they want to say is that, “ every existing contract, as far as it is in contravention of this section, shall be void.”
– Senator Best was not present when Senator Drake urged that certain contracts have already been entered into, which undoubtedly come within the meaning of paragraphs a and b of subclause 1, as regards certain provisions, but contain other provisions, relating to such matters as the care of the machines and the payment of rent, which! are perfectly lawful, and which we do not want to declare void.
– To carry out the honorable senator’s idea, what I would suggest is the insertion of a new sub-clause to the effect that “ all existing contracts, so far as they are in contravention of this section, shall be void.”
– That would do.
– But we are told that the clause does not apply to existing contracts.
– The first part of the clause applies to existing contracts and combinations.
– I think it deals with an entirely different thing. I wish to point out to Senator Best that Senator Drake, while taking that view, is supporting the insertion of the word “hereafter.” That is not the way for the latter to accomplish what heis aiming at unless he wishes to perpetuate that part of the agreement which is made unlawful by the Bill.
. -When we hear so many honorable senators, including the Minister of Defence, expressing the opinion that contracts made before the passing of the Act will be made null and void by the clause to the extent that they are in contravention of it, that, I submit, to Senator Best is a very good reason for making assurance doubly sure by putting in the word “hereafter,”
Question - That the word “ hereafter “ proposed to be inserted be inserted - put. The Committee divided.
AYES: 8
NOES: 17
Majority … … 9
AYES
NOES
Question so resolved in the negative.
Amendment negatived.
Clause agreed to.
Clause5 -
Penalty : Five hundred pounds.
– In the opinion of a good many honorable senators this clause is ultra vires, because under the Constitution the Commonwealth has no power to deal with trade and commerce within a State. Holding the view I do, I shall vote against the clause as a whole. I do not think that any more important proposal has ever come before the Senate, because it is an attempt to interfere with trade in a State, which, in my opinion, is a matter reserved exclusively to the State Parliament by the Constitution. Although I intend to vote against the clause as a whole, still I do not care to lose the opportunity of moving an amendment similar to the one I proposed in a previous clause. It is more necessary in this clause, because if we have any power of interfering with trade concerns within a State, it is desirable that the provisions of this legislation should be applicable in cases where there is a combine to raise the prices of commodities. Throughout the Bill, the intention seems to be always to punish persons who sell things cheaply. In my opinion, it is desirable that they should come within the purview of the measure if they unfairly raise prices as well as lower them. Therefore I move -
That after the word “ combination,” line 5, the following new paragraph be inserted : - ” (aa) with intent to unduly raise the prices of commodities to the detriment of the public ; or “.
.- The amendment, although, apparently, innocent in itself, is certainly calculated to impair the effectiveness of this provision. Accord ing to all American cases, an attempt to unduly raise the price of commodities would be a restraint of trade. The amendment would cut down paragraph a because the latter might be taken to have a meaning different from “ restraint of trade.” It would shake the very full meaning which, by the American cases, is attached to restraint of trade. According to the Sherman Act, a mere agreement for the purpose of fixing prices at all, whether reasonable or unreasonable, is regarded as being in restraint of trade, and consequently illegal. Senator Drake wishes to pick out a proceeding which is manifestly included in that phrase. I hardly think he will deny that his proposal is most distinctly covered by paragraph a.
– I do not admit that at all.
– I have quoted a number of American cases which clearly show that the mere fixing of prices whether reasonable or unreasonable, is in restraint of trade.
– Does this provision carry out the American construction?
– No; it is lighter than the American law. The Sherman Act of the United States declares to be illegal any restraint of trade, reasonable or unreasonable. According to English law, it is only an unreasonable restraint of trade that is illegal.
– If the banks combined to fix a rate of exchange, would that be illegal ?
– The mere fixing of a rate of discount or interest would not be an act in therestraint of trade. My contention is that, first of all, this amendment is covered by paragraph a, and, secondly, that to insert it here would be calculated to aggravate the wide effect of paragraph a.
– I cannot admit that the amendment is covered by paragraph a. I do not think that a combination to raise prices would necessarily be held to be in restraint of trade. What I propose is the same term as is used in the Canadian Act; and, if fixing a price is to be held to be in restraint of trade, why has the Government inserted in clauses 7 and 8 the words - the supply or price of any service, merchandise, or commodity.
Why not leave that under the heading of “restraint of trade”? At any rate, my amendment would make it quite clear that it would be an offence to unduly raise the price of commodities in restraint of trade. I spoke in my second-reading speech of the possibility of a combination of coal merchants being formed to raise the price of coal. It might be that the requirements were so great at that time that the consumption of coal would go steadily up. How could it be held that the trade in that particular article had been restrained when the figures showed that the consumption was increasing? An increase of consumption, therefore, would prevent a conviction, whereas raising the price of commodities would be a thing that would be perfectly clear, and could be easily proved. I hope the Committee will seriously consider this matter, and will agree to this amendment.
.- I will mention the case to which I referred. It is the Addyston Pipe and Steel Company v. The United States. It was dealt with in 1889, and is reported in volume 175 of the United States Reports, page 211. The note I have here is -
Power to regulate Inter-State commerce includes power to interfere with and prohibit private contracts in restraint of such commerce. Combination of manufacturers and vendors to raise prices is in restraint of Inter-State trade.
Question - That the words proposed to be inserted be inserted - put. The Committee divided.
AYES: 11
NOES: 12
Majority … … 1
AYES
NOES
Question so resolved in the negative.
Amendment negatived.
– I must once more appeal to the Committee to consider clause 5. It appears to me to be perfectly clear that those who think that Parliament has power to pass this clause are relying upon an interpretation of paragraph xx. of section 51 that certainly does not give effect to the spirit of the Constitution. The argument comes down to this - that in consequence of the word “ status “ having been dropped out of paragraph xx. during the Convention, the Government is prepared to take advantage of that drafting amendment to push the provision as far as it will possibly , go. To do so is not in accordance with the spirit of the Constitution. Hitherto we have endeavoured to be careful not to encroach upon the States rights. The States have, in some instances, I think assumed an unreasonable attitude with regard to what the Commonwealth has done. But if we do anything like this, we shall give edge to the complaints of the States, because we shall interfere with them in a matter in regard to which they are naturally very jealous. Probably there are few subjects upon which people are more “touchy” than their trading rights; and by this clause we are asserting a right to go into a State and interfere with the trading operations carried on within it in a manner that may lead to great difficulty. The Committee should put aside the views that have been expressed as to the proper construction of the Constitution, and should consider whether it is a fair and right thing that we should in this way interfere with the trading rights of a State. The contention of those who are supporting the Government really depends upon an inaccurate, and what I must call a tricky, interpretation of the Constitution. I do not for a moment think that the High Court would give that narrow interpretation to it. I feel perfectly certain that in accordance with the well-known rule that every Constitution shall be construed as a whole, the High. Court would consider that paragraph xx. is subject to the general powers with regard to trade and commerce contained in paragraph 1. of section 51. If we want to ascertain what power we have in regard to trade and commerce, we must look exclusively to paragraph 1. of section 51 and to section 98. In the latter section, in regard to trade and commerce, the Constitution makes a distinction as clear as possible between the rights of the Commonwealth and the rights of the States, giving to the Commonwealth the matters that can best be controlled by it, and leaving to the States all domestic matters. That is the general rule that is observed throughout the Constitution. I submit that there is no departure from that rule with regard to trade and commerce. All trade between the States and between Australia and foreign countries is given to the control of the Commonwealth, but trading within a State is left exclusively to the State. We are here presuming to interfere with trading corporations within a State, making a distinct difference between the operations of corporations and the operations of trading firms. As I pointed out yesterday, there might be on two sides of one street a corporation and a private firm doing exactly the same kind of business; and if the view of the supporters of this clause be correct, one would be acting under Commonwealth law and the other under State law. That would cause more resentment on the part of the States than almost anything we have yet done. There is already sufficient trouble and friction between States and Commonwealth. We should not rashly add to it. I hope that the Committee, having an opportunity to reconsider the matter, will act wisely, and will not give the States any ground for further umbrage by passing a clause of this character.
Senator MULCAHY (Tasmania) [9.20). - We had yesterday a long debate upon this point, in which, as usually happens in regard to legal questions, the lawyers differed. Some extraordinary contentions were put forward bv Senator Best, who held that if there was anything in the shape of a ridiculous anomaly in the Constitution, we should accept it loyally, and legislate to put it into effect.
– No one suggested that there was a ridiculous anomaly.
– The honorable senator distinctly used the word “ anomaly.”
– “Anomaly” not “ridiculous anomaly.”
– It is our duty in legislating to act, not only in accordance with the letter, but also with the spirit of the Constitution. . What was intended by the constitutional provision in question can be_ ascertained from the debates that took place. Having heard honorable senators on each side, I was very much impressed by the arguments of Senator Symon and1 Senator Drake. But since then, I havehad an opportunity to converse on this subject with two well known members of the legal profession, who are members of another place. One is a staunch supporter of the Government, and the other, although not a Government supporter,’ is recognised as an able lawyer. Both these gentlemen are strongly of opinion that if we pass thisclause it will be ultra vires. Surely that should make us pause. The point is a verv important one, and if it goes to a vote- I shall have to support Senator Drake.
– We cannot tell whether it is ultra vires until it goes before the High Court.
– Surely we should try to find out, and not make ourselves ridiculous ?
– Both the AttorneyGeneral and Senator Best assure us that the clause is right.
– Senator Keatingyesterday declared that we even had the power with regard to marriage to pass legislation making it unlawful for the wife and husband to carry on two different businesses.
– I did not declare anything of the kind. If the honorable senator’s appreciation of Senator Best’s argument is as clear as his appreciation cf my point, he does not do it much justice.
S’enator MULCAHY. - I am speaking from recollection.
– What I said was that we had full power to regulate the conditions as to marriage.
.- The Committee has a right to expect that the legal colleague of the Minister in charge of the Bill will give us an opinion on this matter. It appears to me that the clause is absolutely unconstitutional, and I quite agree with Senator Drake that we have no right to pass it on the understanding that if it is ultra vires, the High Court can put us right. We do not desire legislation of thekind. We do not wish to give the High Court an excuse to interfere, or the citizens an excuse for saying we have taken away their States rights. Both Senators Baker and Symon pointed out that this clause must result in a position absolutely ridiculous.
– We have had all this before.
– I have not heard Senator Keating’s view of the matter ; and I should like to. learn whether that honorable senator can justify the clause as it stands? If Senator Keating will say that this clause is constitutional, I shall sit down.
– Will the honorable senator accept my assurance?
– I should like to hear the honorable senator’s opinion.
– I am surprised to hear the Minister of Defence say that this question has been discussed. I have been here since clause 5 was called upon-
– This question was discussed on clause 4 yesterday.
– I am glad I was not present when there was such an irregularity. In any case, I do not see whyclause 5 should have been discussed on clause 4.
– Senator Symon introduced the question when discussing clause 4-
– Even so, I do not think it right.
– Senator Symon introduced the subject on an amendment.
– However, the point is not of much importance. I entirely agree with what Senator Drake has said as to the States aspect of the clause. I certainly think it is wrong for us to interfere with the prerogative of the States, wherever the slightest doubt exists as to our power. In this case there is not the slightest doubt that we are doing what we ought not to do. I do not quarrel with the contents of the clause, but I most strongly object to our attempting to take away from the States any power which was left to them by the Constitution. I am a stranger to the arguments that were introduced yesterday, but I ask Senator Playford how he justifies - putting aside altogether the question of interference with the States - that which, while it does not apply to the wrongful acts of a single individual, seeks to make illegal similar acts when committed bv a corporation ? Senator Drake has given us an instance of what might happen under the clause. A corporation on one side of a street might be conducting its business under Commonwealth law, and a private firm on the other side might be engaged in similar operations under State law, each being competitors. Is Senator
Playford satisfied to allow private individuals to do what he decides is wrong on the part of corporations?
– The answer is that, under the Constitution, we have power to deal with corporations, but not with individuals.
– But is the position satisfactory to Senator Playford? This Bill draws the attention of every individual in the community to the fact that he may legally do what the Commonwealth Parliament has declared to be wrong on the part of corporations. I cannot be a party to passing any part of a Bill which is so unwise, and so insulting, in my opinion, to the dignity of Parliament. Ir seems ridiculous for us to deliberately and advisedly say, that because we have power over corporations we will exercise that power, although we cannot touch individuals. . A wrong does not consist in the person, but in the act done.
– We are inviting corporations to resolve themselves into individuals.
– Of course, and inviting people to resort to all sorts of subterfuges, which can only have the effect of making the law ridiculous. I do not suppose that any honorable senator thinks that an act is either better or worse when committed by a corporation than when committed by an individual, or vice versa.
– Corporations are likely to be the more powerful and do the greater injury.
– I do not agree with Senator Playford.
– Trusts and combinations are corporations.
– There is no difference between the acts of a person and the acts of a corporation ; though, unfortunately for the purposes of this Bill, “ person “ includes “ corporation.” But does Senator Playford seriously suggest that we should proceed with this partial legislation, which cannot have any other result than to make us ridiculous? I make these remarks with the full indorsement of the desirability , of the object of the clause. If it be (rood to stop the operations of injurious monopolies as between States, then it must be good to stop such operations within a single State. If it be shown that such legislation is beyond our power we should forego it regretfully, and not make ourselves ridiculous. But, sup- posing we are not infringing any State rights, we shall become still the more ridiculous if we limit ourselves to one class of corporations. Rather than attempt to pass this partial, inadequate and incomplete legislation, it would be more consonant with the dignity of a legislative body to refrain altogether. .
– - J regret that Senator Clemons did not hear the arguments on this question when clause 4 was discussed.’ The discussion yesterday was not quite irregular, because it took place on an amendment. The question that then struck me was - have we the necessary power, or have we not? I should like Senator Clemons to look at this matter closely, because, from a constitutional point of view, he might be able to enlighten some honorable senators. If we have the power to prevent foreign corporations, and trading and financial corporations formed within the limits of the Commonwealth, from doing wrong, and we have not power to prevent individuals from doing similar wrong, are we to refrain, from passing preventive legislation in regard to the former ?
– Undoubtedly ; if we cannot pass an Act worthy of a place on the statute-book we should leave the matter alone.
– We all agree that we cannot interfere in this connexion with individuals in a State. But I wish Senator “Clemons to give some little consideration to paragraph xx. of section 51 of the Constitution, which deals with such corporations, as I have already indicated. If we have, power to legislate with regard to those corporations, to what extent have we the power to legislate? The argument yesterday turned on the point of the original use of the word “ status “ in regard to those institutions. What does “status” mean? Nobody told us - neither ISenator Drake, Senator Symon, nor Senator Baker. The latter honorable senator quoted from “the Convention debates, but even they did not enlighten us as to the limit of our power to legislate.
– There was some limit, because of the word “ status,” which, however, has been removed.
– I should’ now like to call honorable senators’ attention to a few little comparisons. The very next paragraph of section 51 gives us power, for the “ peace, order, and .good govern ment “of the Commonwealth, to legislate in the matter of marriage and divorce. Does that mean the “status” of marriage and divorce - -t’he “ status “ of the man or the woman? Does that paragraph not give us power to deal with every phase of marriage and divorce, so far as the Commonwealth is concerned ? If that be so, have we not the same power with respect to foreign corporations, and trading and financial corporations formed within the limits of the Commonwealth? Let honorable senators look at some of the paragraphs, of section 51 of the Constitution in which limitations are imposed. Paragraph xiii., for example, gives the Commonwealth Parliament power to legislate with respect to
Banking, other than State banking; also State banking extending beyond the limits of the State concerned, the incorporation of banks, and the issue of paper money.
There is a limitation in that paragraph, but there is no limitation in the paragraphs relating to corporations, or to marriage and divorce, quarantine, and so forth. But, even where there is a limitation, have we not power under paragraph xm. to deal with banking, from the foundationstone to the top of the edifice, so far as the Commonwealth is concerned. Would it be considered an interference with States rights if we commenced to do so tomorrow ? Even if we introduced a clause in the present Bill, could that be called an interference with States rights ? We could be prevented from interfering with State banking in a State, but we might institute an Inter-State Bank, covering the whole Commonwealth. So far as each paragraph i-s concerned, our powers are unlimited, subject only to the reservation’s contained in’ each paragraph. I did not take part in the discussion yesterday, because I consider that clause 5 presents the proper opportunity. The Government have introduced a Bill in which they, as far as possible, deal with foreign and Inter-State corporations, companies, and combinations. The Government have not power to deal so completely with matters confined to any one State, but under paragraph xx. they have power to legislate with regard to foreign corporations and trading or financial corporations formed within the limits of the Commonwealth. I can quite imagine that the Government said, “ Although we may not be able to prevent all the evils that are contemplated in the clause, we can prevent them under the Constitution, so far as these corporations are concerned, and we shall do so.” Clause 5 is now before -us, and will Senator Clemons tell us, after looking at the Constitution, that we have not the power to pass such a provision ? I do not want Senator Clemons to give a hasty answer, but to consider the point. If we have power with regard to banking, insurance, marriage and divorce - if every paragraph of section 51 gives complete power within itself - then under paragraph xx. we have power to pass this legislation, either as part of- this Bill or in a special measure. Are there any institutions more likely to interfere with the trade of the States, or of the whole of the Commonwealth, than are foreign corporations and trading or financial corporations? The power of such institutions to interfere with the trade of the country is almost unlimited. I shall not attempt to give instances, although I could cite any number. As to whether it is wise to pass such legislation under the circumstances referred to by Senator Clemons, I ‘am not prepared to argue with that honorable senator ; but I believe that, where we can pass such preventive measures, we ought to do so, and that is why I express the hope that this clause will be passed without any alteration.
– The clause before us is one of very grave importance. It would be a very good thing for the people of Australia to take note, as I am sure they will, of the views which are held by a number of honorable senators. In some of the States the people will, I think, be much surprised to find their representatives here prepared to “ give them away “ as States. I have here a statement by Mr. Nash, the financial editor of the Sydney Daily Telegraph, and one of the bestinformed commercial men in Australia. It is as follows : -
It will be seen that the “ person “ can only lie reached if the combination or monopoly extends beyond a State, but the corporations are ito be reached at any point. The reason for this is .apparently that the Commonwealth has powers <to make laws for “ foreign corporations and Trading and financial corporations formed within the limits of the Commonwealth.” But the power to make laws for foreign and local trading companies undoubtedly refers to com’pany law, and not to place them under restraints differing from the private individual in respect to their right to trade. We altogether doubt the -distinction which the Bill seeks to inforce in this particular, which would be quite inequitable.
The fact is that the Commonwealth has no power whatever to disturb the internal trade of any State. It can stop imports and exports on the coast, and oan legislate for Inter-State transfers, and there its power ceases. But take any important industry now in the hands of “corporations,” the Commonwealth dare not stop it, as it would throw vast numbers out of work, and injure producers and consumers. We are inclined to regard these provisions as little more than a farce. The Bill claims the power to paralyze monopolies and combinations, but we altogether doubt those claims ever being inforced.
That is a very strong expression of opinion about the clause, and I believe that it is thoroughly accurate. It certainly expresses the view which is held in New South Wales with regard to proposals such as are now made by the Government. If the debate has done no other good it has elicited from various senators the assertion that they are prepared to go beyond the limits of the Constitution, and to take powers which it has not bestowed upon them.
– It is not fair to say that. Thev are not prepared to do that.
– The honorable senator now wants to repudiate that intention^ but I think it has been made abundantly clear that the rights of the States are in great jeopardy, and, strange to say, they are in almost more danger from the Senate which specially represents the States than from’ the House of Representatives. I strongly urge honorable senators to think out the position before they go to meet the electors.
– It was not fair for Senator Pulsford to say that there are some senators who are,, prepared to go beyond the limits of the Constitution. There are ‘some honorable senators who, in supporting the clause, are prepared to go further than he is, but that is entirely because their reading of the Constitution is different from his.
– I want to make that known.
– No honorable senator who is going to vote on the opposite side to Senator Pulsford objects to that being made known. What I object to is the statement that I am prepared to go beyond the limits of the Constitution. When those who have been regarded as amongst the leading lawyers in this Parliament take different sides on this point, as they do on many other points arising out of the interpretation of the Constitution, is it surprising that laymen should also take different views? The AttorneyGeneral, Senator Keating, and Senator Best have expressed one view, while Senators Symon, Clemons, and Drake hold an entirely opposite opinion. If I, as a layman, find that there is any doubt as to the construction of a provision in the Constitution, I must apply my own commonsense, and read into the words that construction which appears the most feasible. Under paragraph xx. of section 51 of the Constitution, the Parliament is empowered to legislate with respect to - foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth.
It does not say whether the corporations shall extend beyond the limits of any one State or not. Then under paragraph xxxv. the Parliament has power to legislate with respect to - conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State.
In that case, note, it is specially stated that the disputes shall extend beyond the limits of any one State. It has been contended by Senator Drake that it was never intended that Parliament should have power to deal with trading or financial corporations which are operating only within the limits of any one State. If that is the case, why was not the intention specifically mentioned in paragraph xx. as it is in paragraph xxxv. ?
– I contend that we cannot deal with them in regard to trade and commerce.
– As a layman, 1 have to look at the face of the Constitution, and to put upon the words that construction which seems to me the most reasonable. When I find in some paragraphs of section 51 a specific statement as to what we can or cannot do, it seems to me, as a layman, that paragraph xx. gives us power to deal with various corporations within the limits of the Commonwealth, whether they are operating within a State or beyond its confines. I admit that Senator Drake put a very strong argument as to the wisdom of taking this step when he pointed out that although a corporation and a single individual might be acting in restraint of trade on opposite sides of a street, we would have power to deal with the corporation, but not with the individual. That argu ment does appeal to me; but there again. I have to look at the matter from the stand-point of a layman. It seems to me that there is more likelihood of injury being done to the community in the matter of restraint of trade by a corporation than by an individual.
– If the clause is passed, and it is good, what will happen ?
– We shall have power to restrain the corporation.
– But supposing that we can, what will happen?
– We will have power to stop corporations from doing that which we believe to be an injury to the community.
– We want to stop the thing being done, and not the persons doing it.
– Exactly, and so far as we are empowered by the Constitution we shall stop the thing being done. We have not power, however, to deaf with an individual so acting. If an individual is found to be acting in restraint of trade, or doing an injury to the comm unity, it will remain for the State Parliament to interfere. We are not responsible for that anomaly ; the responsibility rests with the framers of the Constitution.
– A State Parliament has power to deal with both corporations and individuals when they are trading within its limits.
– The fact that in this Bill we have exercised our power in regard to corporations may be an incentive to the States Parliaments to exercise their power in regard to individuals. I intend to vote for the clause as it stands.
.- When I read the Bill for the first time, clause 5 appeared to me to be ultra vires, but after listening to the debate I have come to the conclusion that, apparently, we have power to deal with foreign corporations, and trading and financial corporations formed within the limits of the Commonwealth, but that we cannot deal with individuals who may commit as like offence. Senator Pulsford has attempted to show that legislation of that character - passed in the exercise of a power which we believe we have - is an invasion of State rights. Such a contention is absolutely farcical. We can understand such charges being made by irresponsible persons, but we have reason to pause when we hear them made on the floor of the Chamber. What is the position? It is contended that because we cannot reach one class of individuals we must therefore let all go free. We are not responsible for the drafting of the Constitution. We can do no more than exercise to the fullest extent our legislative power in this regard, and as in the case of the Commerce Act it will remain for the States Parliaments to supplement our legislation. It seems to me that there is a strong consensus of opinion in favour of the view that, constitutionally, we have the right to impose this restraint on foreign corporations, and trading, or financial corporations formed, not within a State, but within- the Commonwealth. The fact that we have no power to place a limitation upon individuals does not appeal to me as a reason why we should not exercise our power in regard to corporations ; and the exercise of the power is not an invasion of State rights, but the mere performance of a duty which is intrusted to us by the Constitution.
– If we have power to restrain corporations from doing the public an injury, I shall be quite willing to exercise it. Therefore, I can, at least, say that in the arguments I am about to offer, I am not allowing the wish to be father to the thought. I have listened to the discussion with a view to satisfying myself as to the vote which ought to be given. It is contended that each one of the various legislative powers contained in section 51 ‘ must be regarded as separate and complete in itself, and that, therefore, while under paragraph i., we have a general power with regard to trade and commerce, yet, under other paragraphs, we may, also have trade and commerce powers, so far as they are carried on or affected by the particular individuals or subjects dealt with therein. Under paragraph xx., which deals with foreign corporations and trading or financial corporations formed within the limits of the Commonwealth, it is contended that we have absolute power to legislate - not merely as to the way in which corporations shall lie formed and registered, or what particulars they may publish, but as to everything which they may do or refrain from doing. If we have the power to regulate the commercial and trading operations of a corpora tion, then I want to ask honorable senators where it will land us ? Let us take, for instance, paragraph xxxv., dealing with conciliation and arbitration -
Conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State.
That is exactly on all-fours with paragraph x., which reads -
Trade and commerce with other countries and among the States.
The two paragraphs are on all-fours, inasmuch as there is. the same limitation which prevents us from legislating unless the subjectmatter extends beyond the boundaries of any one State. I go a step further, and say that if having the power to deal with foreign corporations, we have the right to deal with their trading and commercial undertakings, so we should have the right to bring them under an arbitration law different from that which prevails for the rest of the community. We could have an arbitration law which was limited by paragraph xxxv. to “ industrial disputes extending beyond the limits of any one State,” but if a corporation in Melbourne had a dispute with its employes, which did not extend beyond its own factory, we could claim the right to bring it under our arbitration law, because we have full power to deal with corporations.
– Hear, hear ! The Minister of Defence and Senator Keating said that there is no stopping place.
– There can be no half-way house in this matter. I was not present when Senator Symon submitted a proposition by which he sought to measure the accuracy of the Government’s intention, but I understand that Senator Keating agreed that any one married under a Federal law-
– We have the fullest power to regulate the conditions of marriages and’ the consequences.
– And not their trading?
– And our regulations might involve the question of separate trading.
– That is exactly as I understood the matter– that we have the right to deal with marriages as with arbitration. Suppose that we passed a marriage law. If the contention of my honorable friend be correct, any one who was married under that law could be dealt with under the trade and’ commerce power. Have we a right to say to those who are married under a Federal law, “ You shall be under certain trade restrictions within the State in which you live?”
– What I said was that we could attach, certain conditions .and consequences to marriage within the Commonwealth if we legislated with regard to that subject.
– Even in> regard to trading operations?
– They might affect trading operations.
– Do honorable senators suppose that it was ever intended that the Commonwealth Parliament should have power to legislate with regard to marriage and divorce, so as to provide in a monstrously absurd fashion how people who were married should conduct their trade?
– This is utterly absurd ! Of course, it is possible to reduce anything to an absurdity.
– It is not necessary for any one to make an effort to reduce things to an absurdity, so far as this Bill is concerned. I go back to my original instance. I ask Senator Best to say, if the interpretation that he gives of the point under discussion be correct, whether be will deny that we can, so far as foreign corporations are concerned, claim the right to deal with an industrial disputes that thev may have?
– Undoubtedly, I deny it.
– If Senator Best affirms that each of the paragraphs in section 51 is absolutely complete in itself, and that so far as they give us power to legislate, we can legislate in and over and around the subjects, and if he then tells me that while we can restrain the trade of a foreign corporation, or a banking corporation, we cannot also deal with any industrial disputes which thev may have - all that I can say is that his argument is utterly incomprehensible.
– Does Senator Millen contend that if Senator Best’s argument is correct, we have a right to deal with foreign corporations under the paragraph respecting conciliation and arbitration?
– Exactly. We have absolute power to deal with a corporation, but we cannot touch, it in respect of industrial disputes unless they extend from one State to another.
– Section 51 lays down a limitation with regard to industrial disputes, but it does not make any limitation with regard to corporations.
– We have absolute full and complete power to deal with foreign corporations restrained only by the limitations we find in section 51. We have absolute power to deal with foreign corporations in respect of disputes with employes limited by paragraph xxxv. We have absolute power to deal with, the trading of a corporation limited by paragraph 1. If there is a. limit in the one case there is in the other; and if there is no limit in the one case there can be none in the other. Yet Senator Best assures us, on his reputation as a lawyer, that while we must read paragraph xx. side by side with paragraph xxxv., dealing with conciliation and arbitration, we are under no obligation to read paragraph xx. side by side with the paragraph that deals with trade and commerce. I have never, in the course of not a few years of parliamentary experience, heard arguments put forward which have so little substance in them, but which at the same time have met with so rapid an acceptance. I can only assume that honorable senators have allowed the wish to father the thought before looking into the matter carefully, and arriving at a cautious conclusion. I am anxious to restrain corporations or any one else from doing a public injury. But I believe that in this case we are acting against the Constitution, and are trenching upon the domain of the States. I appeal to honorable senators to consider this matter very carefully. It has often been said that the special function of the Senate is to protect States rights. From that point of view this is a very serious matter. I believe that the majority of the members of the Senate recognise the obligation that rests upon this Chamber, and that if they could be shown that this was a provision that did entrench upon States rights they would’ be with me in resisting it. But there is a doubt; and what is our duty in that case? It appears to me that we, whose special function it is to protect States rights, should in a case of doubt hesitate until we have an opportunity of satisfying ourselves upon the question in dispute. I am riot prepared to believe that the Government would desire to hurry honorable senators to a decision before there has been ample time to consider the point.
– I wish there was a little hurry !
– The Government has been trying to hurry matters, but more haste does not always mean more speed. The Minister cannot dispute my contention that there is a danger. If there has been any delay he has been largely responsible for resisting quite inoffensive amendments. I again appeal to honorable senators to recollect the special functions of this Chamber, and if there is a doubt, to give the benefit of it to the States whose interests they are supposed to protect.
– There is another point which strengthens Senator Millen’s argument. Paragraph
– With the consent of the State.
– Upon the argument advanced by Senator Best and the Government, the Commonwealth possessing those railways would have full power over them with respect to trade and commerce. Yet we find if we turn to section 98 of the Constitution, that there is a special provision dealing directly with trade and commerce, with navigation and shipping, and with railways the property of a State. Paragraph xxxii. of section 51, gives the Commonwealth control of railways for naval and military purposes. The Constitution includes a special section to provide that our powers with regard to trade and commerce shall be extended in. regard to those matters, showing how careful the framers of the Constitution were to express exactly what was meant by our trade and commerce powers. It seems to me to be perfectly clear that just as in regard to conciliation and arbitration, if we wish to know what powers we possess we must look to the paragraph dealing with the subject, so, if we want to know what powers we possess with regard to trade and commerce, we must look to paragraph 1, where we find that our power is to legislate with regard to trade and commerce with other countries and among the States.
Question - That clause 5 stand part of the Bill - put. The Committee divided.
AYES: 13
NOES: 9
Majority … … 4
AYES
NOES
Question so resolved in the affirmative.
Progress reported.
page 3302
Motion (by Senator Playford) pro posed -
That the Senate do now adjourn.
– A few days ago the Minister of Defence, who is the leader of this Chamber, made the following answer to a question as to the business to be dealt with by the Senate: -
The Australian Industries Preservation Bill will, unless something extraordinary takes place, be kept at the head of the notice-paper until it is disposed of.
There was a promise that, unless “ something extraordinary “ took place, the Bill with which we have been dealing to-night would be kept at the head of the noticepaper until it was disposed of. But the Minister, after giving his word to the Senate broke it - unless he can show that “ something extraordinary “ did take place - in my absence. If was not courteous to me to say the least of it. I accepted the assurance that the Bill with which the Senate has been dealing to-night, would continue to be dealt with until it was disposed of. But last night the Minister suddenly had the order of the day for the resumption of the debate on the second reading of the Judiciary Bill called on, ant? that Bill was rushed through, and read a third- time to-day. I hope that Senator
Playford will explain the matter in such a way that any honorable senator, whether taking up a friendly attitude towards the Government or not, will be able to accept his word when he makes a definite promise in regard to public business.
– I certainly stated that I intended to keep the Australian Industries Preservation Bill at the head of the notice-paper, unless something special occurred. I do not know whether I said “ something extraordinary. “
– I quoted from Hansard.
– If I did I meant “something special.” The facts are that a gentleman known as the leader of the Opposition in another place called in question the action of the Government in not pushing on with the Judiciary Bill in the Senate ; and the leader of the Opposition here was also desirous that the Judiciary Bill should be proceeded with. Furthermore. I did riot bring on the Judiciary. Bill without notice. I informed honorable senators that I intended to keep the Australian Industries Preservation Bill first on the notice-paper until the usual dinner adjournment yesterday, and that afterwards we would proceed with the Judiciary Bill. I gave clear and proper notice of that intention.
– No one who was not present in the Chamber would know of it.
– Every member of the Senate is supposed to be here. What right have honorable senators to be away? If they are away they must take theconsequences.
– They know now that they cannot take notice of the Minister’s word.
– I do not know that any other honorable senator would say that he could not take my word. What I said, or meant to say, was that unless something special occurred we would proceed with the Australian Industries Preservation Bill until it was disposed of. I did not depart from that determination until something special had occurred, and I gave notice to the Senate.
, - Mr. President-
– The Minister has replied.
– I am perfectly willing to allow discussion to go on.
– A senator who proposes a motion has the right of reply, but he cannot speak again unless some amendment has been moved.
– Senator Playford rose while Senator Clemons was still speaking, and he can hardly be said to have spoken in reply.
– Strictly speaking, according to the Standing Orders, the debate has finished, but if any one has been misled through Senator Playford speaking before the debate was really finished, I will allow it to be reopened.
– I wish to say that yesterday, through not wishing to interpose to disturb the harmonious relations that existed, I made no strong objection to what was being done with regard to the Judiciary Bill. I was partly instrumental in leading Senator Clemons to believe that the Australian Industries Preservation Bill would be proceeded with, and that no other business would be brought on until that had been completed. Arrangements were made between Senator Clemons and my self, which did not necessitate his attendance here during the progress of that measure. Yet we are told that because the leader of the Opposition in another place, and the leader of the Opposition here, expressed a wish-
– I do not say that the leader of the Opposition here expressed any wish. I told him what I proposed to do, and asked him whether he saw any objection, and he saw none. It is usual and courteous on the part of the representative of the Government to, as far as possible, consult the leader of the Opposition in regard to the conduct of business.
– No doubtthe leader of the Opposition would consent to the proposition made by the representative of the Government ; but it seems to me that there was another consideration quite as important, namely, the understanding which had been arrived at previously.It is all very well for the leader of the Opposition in another place to appear just when he chooses, and upset arrangements which have been made not only in another place, but in this Chamber.
– The leader of the Opposition in another place did not upset any arrangement.
– There was a re- quest made by the leader of the Opposition in another place that the Judiciary
Bill should be hurried on, though he did hot give the slightest shadow of a reason for urgency, or for that measure being interposed during the progress of the Australian Industries Preservation Bill.
– I gave -due notice the day before.
– But it was then too late to give notice, considering that senators had made arrangements on ‘ the faith of the understanding that had been arrived at. I am quite satisfied that the Minister of Defence had no intention to put honorable senators to any inconvenience ; but, at the same time, it does not seem quite right that, simply because the leader of the Opposition, in another place, expressed a wish, a previous arrangement should be upset, and the members of the Senate put to inconvenience.
– I do not think that Mr. Reid made any request that would justify honorable senators taking up the position they have.
– Mr. Reid did not make any request, but merely a suggestion. I have in this matter acted in all good faith, and taken the usual course under the circumstances. Complaint was made that the Judiciary Bill was not being pressed forward, and I saw the leader of the Opposition in this chamber, and said that on the following day, if he had no objection, I intended to consider the so-called’ Anti-Trust Bill until the dinner hour.
– How . could the Minister of Defence do that after the final and definite statement he had made?
– My “final and definite statement “ was subject to conditions.
– Only if “something extraordinary “ took place.
– It was “extraordinary” to find the leader- of the Opposition in another place.
– What has another place to do with the Senate?
– I took the opportunity to inform the leader of the Opposition in the Senate what I proposed to do, and he saw no objection. Further, I rose in my place, and stated my intentions, and no honorable senator objected. I did what I thought was right and proper; and all I can say is that I am exceedingly sorry if honorable senators were unintentionally deceived or inconvenienced in any way. Perhaps, the better way in the future would be not to make any promises, and thus avoid trouble.
– Is it the intention of the Government in the future to acquiesce in Mr. Reid’s suggestions as they have on this occasion?
– I do not know. The Government always desire to consider the! leader of the Opposition in any reasonable request.
– The Minister did not tell the leader of the Opposition in the Senate of the statement made the day before.
– I should say that the leader of the Opposition was here and heard the statement.
– I am sure he did not hear it.
– All I can say is that I am very sorry if any honorable senator was deceived, or prevented from being present when an important Bill was under discussion.
– Of course I was deceived, or I should have been here.
Question resolved in the affirmative.
Senate adjourned at 10.30 p.m.
Cite as: Australia, Senate, Debates, 23 August 1906, viewed 22 October 2017, <http://historichansard.net/senate/1906/19060823_senate_2_33/>.