Senate
29 September 1922

8th Parliament · 2nd Session

  1. Senate
  2. 8th Parliament
  3. 1922

The President (Senator theHon. T. Givens) took the chair at 11 a.m., and read prayers.

page 2883

QUESTION

IMMIGRATION

co-operationof queensland.

Senator FOLL:
QUEENSLAND

– I ask the Minister representing the Prime Minister whether he has seen a statement appearing in the Melbourne press this morning in connexion with the Commonwealth Government immigration scheme, in which the Premier of Queensland states that he understands that the Commonwealth Government have entered into an agreement with the States of Western Australia and Victoria with regard to an immigration policy, and, further, that Queensland has been ignored in the matter?

The PRESIDENT (Senator the Hon T Givens:
QUEENSLAND

– Order!. The honorable senator has not himself the right to make a statement in asking, a question, and the Premier of Queensland cannot be accorded a right in this Senate which honorable senators themselves do not possess.

Senator FOLL:

– I ask whether the Premier of Queensland was justified in suggesting that the Commonwealth Government have ignored Queensland and tho Queensland Government in connexion with the Commonwealth immigration scheme ?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– In consequence of a somewhat similar question submitted to me yesterday by the honorable senator, I have had an opportunity of looking into the matter to find out exactly how it stands. The information with which I am furnished, and portion of which I can say from personal knowledge is correct,. is as follows: -

At the October-November 1921 Conference between Commonwealth and State Ministers, a resolution was carried to the effect that, with a view to providing for the employment of the immigrant in the preparation of land for settlement, and for subsequently affording him an opportunity of settling upon such land, the States should submit concrete schemes, and the Commonwealth should borrow the necessary money if such schemes were accepted. The Government of Queensland, in common with the Governments of the other States, was subse- quently urgently requested, on -two occasions, o submit definite proposals in compliance with the tenor of the Conference resolution. The details asked for were to include, inter alia, the work the Government would guarantee to immigrants, the number of immigrants they were prepared to absorb, and the amount of money required from the Commonwealth for the necessary developmental works connected with the land proposed to be made available. The . Government of Queensland did not supply the desired particulars in regard to any concrete scheme, with the result that no agreement has been entered into between the Commonwealth and that State with regard to the land settlement of immigrants.

Senator FOLL:

– Following upon the answer to my question, I ask the Minister representing the Prime Minister whether if the people of Queensland are wise enough to return a sane Government who will have the encouragement of immigration as a part of their policy, he anticipates that a favorable arrangement could be. entered into between the Commonwealth Government and such a Government of Queensland to give effect to that policy ?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– The offer of the Commonwealth Government with regard to immigration is still open to all States alike.

Senator Wilson:

– And all kinds of Governments.

SenatorE. D. MILLEN.- Irrespective of the Government.

Senator MacDONALD:
QUEENSLAND

– Following upon the question asked with regard to the vexed matter of immigration, I ask the Leader of the Government in the Senate if the statement attributed to Mr. Theodore in this morning’s ‘ press to the effect that he had not been able to get any information from the Commonwealth Government is true?

The PRESIDENT:

– Order ! The honorable senator has just listened to my ruling that an honorable senator has not the right to make a statement in asking a question, and no one outside, whether he be the Premier of Queensland, or any one else, can be accorded a right which honorable senators themselves do not possess.

Senator MacDONALD:

– The only basis upon ‘which I can found my question is the statement attributed to the Premier of . Queensland. If he is right in the statement he makes, the charge of a lack of courtesy and neglect to communicate rests with the Commonwealth Government. I therefore ask the Leader of the Government in the Senate if the statement which appears in this morning’s press, that the Premier of Queensland, representing a Labour Government, has not been able to get any information from the Commonwealth Government on the subject of immigration, is true?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– We. seem to have been given evidence that a feeling of camaraderie prevails between representatives of the same State in the Senate. Senator MacDonald has just put to me a question which Senator Foll, also representing Queensland, submitted a moment before, and which I endeavoured to answer to the best of my ability.

Senator MacDonald:

– I do not think it has been answered.

Senator Foll:

– It was not answered to suit Senator MacDonald.

Senator MacDonald:

– ‘Apparently the’ Minister was prepared to answer it to suit Senator Foll.

The PRESIDENT:

– Order !

page 2885

QUESTION

POST AND TELEGRAPH DEPARTMENT

Broken Hill Mail Contract

Senator MacDONALD:

– In the absence of Senator Gardiner, I ask the Minister representing the Postmaster-General whether he is now in a position to reply to the question which Senator Gardiner asked yesterday concerning a Broken Hill mail contract?

Senator EARLE:
Vice-President of the Executive Council · TASMANIA · NAT

– On 28th September, Senator Gardiner asked the following questions: -

  1. Who has the present mail contract for running mails, &c, from the Broken Hill postoffice to Sulphide-street railway station?
  2. When will this contract expire?
  3. What is the amount being paid to the present contractor in connexion with this work?

I promised that the information would bo obtained. The following are the replies supplied by the Postmaster-General : -

  1. Thomas Clarke, Broken Hill.
  2. 31st December, 1924.
  3. £100 per annum.

page 2885

QUESTION

NEW GUINEA TERRITORY

Land Ordinances and Regulations

Senator MacDONALD:
for Senator Gardiner

asked the Minister representing the Prime Minister, upon notice -

Can the Minister give the date when the Land Ordinance and regulations in connexion with the Mandated Territory of New Guinea Will be brought into force?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– It is impossible at this stage to fix a definite time, but it is anticipated that the regulations in question will be brought into operation at an early date.

page 2885

QUESTION

DEFENCE DEPARTMENT

Officers entitled to W-ae Pensions.

Senator MacDONALD:
for Senator Gardiner

asked the Minister for Repatriation, upon notice -

  1. Is it a fact that every returned officer in the employ of the Defence Department, With the exception of General Sir C. B. B. White, has qualified for a war, pension?
  2. Are any of the officers in the employ of the Defence Department receiving the war pension*
  3. la it a fact that a war widow in New South Wales is receiving a pension of 9s. per fortnight?
Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– Theanswers are as follow: - 1 and 2.1 do not know. War pensions arepaid purely on the medical assessment of applicants’ disabilities due to or arising out of war service. No information is sought from pensioners as to their places of employment, nor the s: mounts of earnings received by them, as these are not factors in the assessing of the rates that shall be paid, and, therefore, no record is kept of the same.

  1. No. The lowest pension payable to a widow whose husband’s death is due to war service is 47«. per fortnight.

page 2885

QUESTION

DATE OF GENERAL ELECTION

Senator LYNCH:
WESTERN AUSTRALIA

asked the Leader of the Government in the Senate, upon notice -

Whether, if an election is to be held before Christmas, the Government will see that the date is so fixed as to cause the least inconvenience to harvesting operations in the four wheat-producing States?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– I can assure the honorable senator that the point raised by him will be borne in mind.

page 2885

AUSTRALIAN SOLDIERS REPATRIATION BILL

Motion (by Senator E. D. Millen) agreed to -

That leave be given to introduce a Bill for an Act to amend sections 7, 22, and 44 of, and the 2nd and 4th schedules to, the Australian Soldiers Repatriation Act 1920-21, and to provide additional payments for persons suffering from certain specified disabilities.

Bill presented, and read a first time.

Senator E D MILLEN:
Minister for Repatriation · NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

.- I move-

That so much of the Standing Orders be suspended as would prevent the second reading of the Bill being taken without delay.

In submitting that motion I inform honorable senators that I do not desire to close the debate on the second reading to-day. I think it would be of advantage” if I were afforded the opportunity of making an explanatory second-reading speech. The adjournment over the week-end will give honorable senators an opportunity of studying the Bill.

The PRESIDENT (Senator the Hon T Givens:

– Before putting the motion, concerning which, there is no notice on the business-paper, I may say that it requires an absolute majority of the whole Senate to carry it.

Question resolved in the affirmative, there being an absolute majority of the whole Senate present, and no dissentient voice.

page 2886

SUPERANNUATION BILL

Second Reading

Senator PEARCE:
Minister for Home and Territories · Western Australia · NAT

.- I move-

That this Bill be now read a second time.

I desire to intimate to honorable senators that there will be no objection to the debate being adjourned in order that they may have a full opportunity to consider my remarks in moving the second reading. I intend, first of all, to deal with two classes of criticism directed against the measure. One is that it is an election bribe, and the second that not sufficient time is being given for its consideration because it is heing rushed through. In regard to the first criticism, I direct attention to the fact that, when the Government were seeking to be returned at the last election, , a deliberate promise was made by the Prime Minister (Mr. Hughes) that this legislation would be introduced. Every member of this Parliament returned as a Nationalist, unless he dissociated’ himself from this policy, may he assumed to have been elected on the understanding that he would support a policy which would bring about a superannuation scheme for the Public Service. Circumstances prevented the Bill being passed earlier. One of those circumstances was the fact that the drafting of the measure required the serious consideration of Cabinet, and its examination, subsequently, by actuaries to determine whether it was sound or not. I have had a pretty long experience in Cabinet myself, and it happened to be, shall I say, my misfortune, to be a member of the various sub-Committees that were appointed by Cabinet to consider this scheme. I know of no other measure that has received such close attention by Cabinet. As regards the principle, that, of course, was declared in the policy of the Government, but the machinery part of the scheme called for the closest consideration of more than one sub-Committee of Cabinet, and it has been reviewed, not merely by the Statistical Branch of the Home and Territories Department and officials of the Treasury, but ako by outside actuarial authorities in regard to its soundness.

Senator Keating:

– I notice that the name of Mr. Wickens, the present Statistician, has been mentioned as- one who investigated the Bill. Did Mr. Knibbs also consider it?

Senator PEARCE:

– In the earlier stages of the scheme, yes, because he was then in charge of the Statistical Branch, and, of course, he was consulted.

Senator Keating:

– Did he express an opinion as to its soundness?

Senator PEARCE:

– I feel pretty sure that he did; but, of course, in the later stages Mr. Knibbs had discontinued h.s connexion with the Statistical Branch, and I cannot say if he was consulted as to the scheme now before the Senate.

It is, of course, well within the knowledge of all honorable senators that this measure was promised and was included in the policy of the Government at the last general election. The object of the scheme is to provide payment for those who have given a life-long service to the State, so that on retirement, or in the event of their becoming incapacitated, they will not find themselves in a state of . pecuniary embarrassment. The number of employees who will be affected will . be, approximately, 23,400. From the point of view of the Public Service, there is, of course, a very good reason why the scheme should be initiated. I want also to put the point of view of the , general public in regard to this matter. We all know that in the absence of some superannuation scheme there is the strongest disinclination on the part of Ministers and heads of Departments to discontinue the services of persons, even when in the interests of the public it is desirable that they should be retired. The Minister and the head of a Department may know that the person con- cerned has not been in receipt of a sufficiently high salary to enable him to provide for his old age, although he may have done his best, and, in the circumstances, the Minister is very loath in- deed to punish a man by throwing him out into the world in his old age.

Senator Lynch:

– Why this tenderness in the case of a public employee as against that of a private employee?

Senator PEARCE:

– It is part of that human sympathy which we all exhibit to a more or less extent.

Senator Lynch:

– A man is mighty lucky to be a public employee.

Senator PEARCE:

– I am not so -sure that even Senator Lynch, with all the stern rigour of his character, would not hesitate, if he were a Minister or a head of a Department, before he called upon an officer of the Public Service to retire, if he knew that the officer concerned had not been able to make some provision for his old age. Even in private employment men are frequently retained for many years after their services have ceased to be profitable to their .employers.

Senator Crawford:

– Many of these private firms have pension schemes of their own:

Senator PEARCE:

– That is quite true. They have adopted pension schemes for this very reason. With this scheme in operation the head of a Department, or the Public Service Board, would know if they have to send a man down on account of increasing age or other disability, that,* at any rate, there was some provision for him.

This principle of superannuation is being discussed in certain quarters as if it were something entirely new, whereas it is an old-established principle. It is recognised in the Public Service of the United Kingdom by the Superannuation Acts of 1834-1909. For those officers who entered the Public Service in Great Britain after the 19th April, 1859, and before the 25th September, 1909, the provision is as follows: - If the officer has served for ten years and upwards he receives a pension of one-sixtieth of his salary for each year of service, with a maximum of forty-sixtieths. In respect of persons appointed on or after 20th September, 1909, eightieths is to be substituted for sixtieths, but, in addition, the officer receives, on retirement, a lump sum equal to one-thirtieth of his annual salary for each completed year of service, but not exceeding one and a half times, his annual salary.

In Tasmania, South Australia, and Queensland superannuation payments are made entirely by the employees; but m New South Wales the contributions are* borne equally by members of the State Public Service and the State Government. In the New Zealand superannuation scheme, payments by the employees are on the contributory basis to a fund, and an annual payment of £86,000 is made from the Consolidated Revenue to the fund. In addition, the Government pays such further sum, if any, as is actuarially required to meet charges on the “find during the ensuing year. There the contributions begin at 5 per cent., if the age does not exceed thirty when the first contribution becomes payable, and rise to 10 per cent, if the age exceeds fifty. The New South Wales , scheme is based upon equality of contributions, with concessions to employees, of thirty years of age and over, and it also provides for advance payments by the Government.

The Bill adopts the New South Wales principle of pound for pound contribution, but instead of making an advance contribution of sums into the fund, it provides for payment based on the actual payment of the benefits provided by the Bill.

The principle of superannuation funds contributed to by employers and employees is recognised by ‘ some of the largest public institutions in Australia, such as banks and insurance, finance, and trading companies. The following is a list of superannuation schemes in Australia: - The Vacuum Oil Company pays the entire cost of a liberal pension scheme; the British Imperial Oil Company pays £1 for £1, and also grants liberal bonuses to the fund ; the Royal Insurance Company pays the entire cost ; the Colonial Sugar Company and the Eastern Extension Telegraph Company contribute £1 for £1. The following institutions have considered it wise to /have staff pension funds: - Government - New South Wales Public Service, New South Wales Railways, Queensland Public Service, South Australian Public Service, South Australian Public School Teachers, South Australian Police, Victorian Eire Brigades Board, Victorian State Savings

Bank, Port Phillip Pilots, West Australian Police, New Zealand Public Service (Public Service, school teachers, railways), South African Public Service. Banks - Practically all, including Commonwealth Bank, Bank of Australasia, Bank of New South Wales, Commercial Banking Company of Sydney, National Bank, Commercial Bank. Insurance Companies - nearly all,” including the following : - Royal Insurance Company, Australian Mutual Provident Life Assurance, Temperance and General Life Assurance Society, National Mutual Life Assurance. Private firms - Dalgety ‘and Company, Colonial Sugar Refining Company, Vacuum Oil Company, Marcus Clark and Company, British Imperial Oil Company, Australian Gas Light Company, British Australian Tobacco Company.

The effect of the Bill is to place on Commonwealth public servants, as a class, the necessity of making a moderate contribution, during their working years, towards meeting the cost of their subsistence during old age or earlier invalidity. No other class in the community is under similar legal compulsion. The aged and infirm, if private means are not available, are provided for by means of old-age and invalid pensions, the cost of which is borne by the general community. If public servants as individuals are forced to exercise thrift and to provide something for old age and invalidity, the genera] community, to. the extent of that provision, is so much better off. The public applaud a firm which financially assists a pension scheme contributed to by its employees, but many do not realize, when criticising a Civil Service pension scheme, that the general community, which, through the Commonwealth Government, makes a contribution to the Public Service Pension Fund also contributes, in the shape of business profits, to the pensions payable to the retired employees of the private firms.

In regard to the money cost to the Commonwealth, the effect of the Superannuation Bill is to transfer to the Public Service Pension Fund a considerable portion of the obligation which the Government is required to meet for old-age pensions. Of males over sixty-five years and of females over .sixty years, one-third are in receipt of old-age pensions. This fact indicates that, without a Superannuation Fund, the Commonwealth would probably have to meet a large expenditure for oldage pensions for retired employees and their wives, especially as the great majority of Commonwealth Government employees belong to the lower-paid grades,’ such as letter-carriers, line repairers, assistants, &c, whose wages, even if thriftily used, are barely sufficient to provide against old age and infirmity. Let me interpolate, to drive home the point, that the Government proposal to withdraw from the Public Service Arbitration Act all public servants who are in receipt of a higher salary than £310 per year will only exempt from the provisions of that Act about 5,000 employees, so there are nearly 20,000 in receipt of loss than £310 per year. To put this matter into figures, the Commonwealth, under the Old-age Pensions Act, may be compelled to provide old-age pensions for an employee and his wife, representing a total of £78 per annum. Under the Superannuation Bill, the Government would contribute £52 per annum to the pension of an employee who receives a pension of £104, so that the Government actually saves £26 per annum in such cases.

Senator Rowell:

– Will this debar them from receiving old-age pensions?

Senator PEARCE:

– Yes. In every such case the Government will actually make a saving. The points mentioned above are, of course, quite apart from the general view that the knowledge that, in old age, or in the event of invalidity, an officer or his widow and children would be reasonably provided for, would have the effect of making the officer not only more contented’ to remain in the Service where his training and experience can be best employed, but would add greatly to his efficiency as an officer.

I now come to the consideration of the Bill, and I shall make a few explanatory remarks on its principle.

Senator Lynch:

– The contributions ro the fund increase as salaries increase.

Senator PEARCE:

– Yes. We have recognised that some provision should be made by employees because our Public Service Act compels them to take out life insurance policies.

Senator NEWLANDS:
SOUTH AUSTRALIA · ALP; NAT from 1917

– ‘Will such policies still have to be continued?

Senator PEARCE:

– It will not be compulsory. Payments into a fund to be known as the Superannuation Fund will be made periodically from the Public Service, and also from the Consolidated Revenue, but in the case of the Government these payments will not be, as in New .South Wales, advance payments. It will be built up from three sources, consisting of contributions from public servants, payments from the Consolidated Revenue Fund, and the interest earned from the investment of the fund. This income will be free from Federal and State taxation, and the contributions put into the fund by employees of the Commonwealth are also to be allowed as deductions in their income tax assessments, both Federal and State. The Bill provides that all benefits are to be paid out of this fund. The only other expenditure will be for administration. It is not anticipated that this will form a very heavy charge; but, in any case, it will be paid out of the Consolidated Revenue. Ample provision is made, for the investment of the fund in recognised trustee investments.

The Bill further provides for a quinquennial investigation concerning the state and sufficiency of the fund. The first of these will be undertaken at the expiration of five years after the commencement of the Act, the commencement being the date notified in a proclamation by the Governor-General. This quinquennial investigation must be made by an actuary, whose duty it will be to present a report to the Board, and he will bo bound to state whether a reduction or increase in the rates of contributions payable to the fund, or in the proportion payable by the Commonwealth, will be necessary.

The management will be undertaken by a Board of three persons to be appointed by the Governor-General. One of the members must be a qualified actuary. Another must be appointed from among persons nominated by the public servants in a manner to be prescribed. Having a financial interest in the fund, it is a fair principle that the contributing employees should be permitted a voice in its management. The members of the Board will be appointed for seven years, and will be paid such remuneration as the Governor-General may determine.

The officers affected number 23,400, approximately. “ Employee “ means a person employed in a permanent capacity by the Commonwealth, who is by the termsof his employment required to give hia whole time to the duties of his employment, but does not include a Justice of the High Court or a Judge of any other Court created by the Parliament. “ Service “ means “ Service under, or employment by, the Commonwealth.” The Bill covers the general body of permanent public servants of the Commonwealth, including those employed permanently by the Railways, the Defence and Navy Departments, the officers of Parliament, and 1 a small number of Commonwealth Bank officers, whose rights are expressly reserved.

Senator Garling:

– What is permanent service in the Defence Department?

Senator PEARCE:

– That is defined in the Bill. It does not cover those who are engaged for short terms, such as five and seven years. The essential feature of the employment in the Commonwealth Service is that it must be of a permanent character.

The next matter relates to pension units to be provided under the superannuation scheme. The Bill fixes pension units in clause 28 as follows: -

  1. The sum of Twenty-six pounds per annum shall be the unit of pension.
  2. The minimum amount of pension to any contributor shall, except where this Act requires a pension to be actuarially determined, be two units, and the minimum of pension to the widow of a contributor or pensioner shall be one unit.

That clause contains the working principle of the Bill. The contributions by an employee must be in respect of units of pension, and the number of units in respect of which an employee must contribute must have relation to the salary of the employee, in accordance with a scale of what will be known as salary groups, set out in clause 13, where it will be seen that there is allotted to each salary group a certain number of units as being the units of pension to which the persons in that group shall contribute. Special attention is invited to subclause 2 of clause 13, under which ait employee receiving less than £208 a year may elect to contribute any number of units up to four,, so that an officer on a low salary may receive £2 per week for himself and £1 per week for his widow. The following table shows the number of units an employee shall contribute: -

The scale of contributions has to be considered from two points of view - “ first, that of all employees who enter the Service after the commencement of the Act ; and, secondly, that of those who are already in the Service when this measure becomes law. As regards the first class, to an employee who enters the Service after the commencement of the Act, the scale of units as specified above shall apply. With respect to persons who are in the Service at the commencement of the Act, all those under the age of. thirty must contribute in respect of units of pension as specified in the scale. An employee who, at the commencement of the Act, is not less than thirty, will not be compelled to contribute for more than two units. He may, within three months of the date notified for the commencement of the payment of contributions - (1) elect within the said three months to contribute, at the rates prescribed for the age of thirty, for two, two and a half, three, or four units for which he is entitled to contribute, having regard to his rate of salary; and (2) if the period of his continuous service is not less than ten years, may elect to contribute at the rate appropriate to his age as provided in the schedule fox units additional to the above. In every case where an employee satisfies the Board that adequate provision has been made for himself and family, the Board may exempt him from contributing for mire than two units of pension. If a contributor’s salary is reduced* from one group to another, the number of units for which he is compelled to contribute will be reduced to the number appropriate to the salary group to which he has been reduced. Any contributions previously paid by him in respect of units in excess of the reduced number will be credited as payments for paid-up pensions to be actuarially calculated. In all cases where the age of forty is reached there is no compulsion upon a contributor to increase his contribution, notwithstanding any increase of salary. He has the option to do so.

The amount of contributions to be paid by an employee is based on - (a) the number of units or half-units in respect of which the employee contributes; (6) sex; and (c) the age at which the employee commences to contribute for each unit or half-unit. During the five years next following the. commencement of the Act, and until other tables are prescribed, schedules I. and II. provide the rates of contribution to be paid fortnightly by male and female members, which are based on the retiring age of sixty-five, the age of sixty-five being the retiring age fixed by the Public Service Act.

The following tables show the rates to be contributed fortnightly by male and female employees: -

It will be seen that the contributions are by no means excessive in view of the benefits to be provided.

I come now to contributions by the Commonwealth The provision for payments by the Commonwealth into the Superannuation Fund is made upon a different basis from that which is provided for in the New South Wales Act.

The recent criticism directed against the New South Wales Act in connexion with Government contribution does not, therefore, apply to the clauses of this Bill. These clauses provide that the Commonwealth shall supplement the pension which the employee’s own contributions would furnish. Here I desire to quote the following table prepared by the Commonwealth Statistician (Mr. C. H. Wickens), showing the estimated cost to the Government in successive years: -

That table is, of course, based upon the assumption that the number of individuals in the Service will remain at 24,000.

The Bill applies to a number of persons who come under the Act at the time of its commencement whose ages are somewhat advanced, and allowances have been made on the introduction of this measure’ for lower rates of contribution by them than those specified for such ages. Such an experience is always undergone in the initiation of any public or private scheme, and it would not be equitable to call upon the contributors at an advanced age to pay for all their benefits upon the actuarial basis of their age and corresponding contribution. The difference between the contribution at such a reduced rate and that required under the normal rate has to be undertaken by the Commonwealth by increased payments when the benefits are payable. I notice a criticism, in the press this morning which seems to assume that this is a new discovery, and that the Government and Parliament were not previously aware of it. Those who write such criticism give members of Parliament very little credit for what is called “ nous.” The article was ostensibly contributed by a banker. If be had only referred to some of the banking schemes he would have found .that the banks had to face the same position. If a superannuation scheme for a service or a bank could be commenced with every employee, from the head or the governor down to the least important, at the same age, it would simplify matters very greatly. In the Commonwealth Service some employees are already at the age of 65 years, and are about to retire, and at the other end there is the last messenger boy just over 16 years of age.- ‘ If we were to call upon those who have nearly reached the retiring age, or those who have. reached it, to pay the actuarial equivalent of the pensions they should receive, they could not do it. It would be quite unfair. The general body of taxpayers are asked to take up that difference so as to equalize the burden upon those who will become recipients of a pension.

The Bill is made retrospective, and applies te certain persons over the age of sixty-five who have made no contributions. In their case the whole of the burden of the payment of benefits has to be. borne by the Commonwealth.

All contributions are deducted from the salaries at the time of payment, and are forthwith sent on to the fund.

An employee becomes entitled to a pension upon his retirement on attaining the age of retirement. A contributor who has been in the Service for not less than seven years, and who is retired on the ground of invalidity or physical or mental incapacity to perform his duties, is entitled to a pension, irrespective of when that contingency may happen. The determination as to invalidity or physical or mental incapacity for performance of duties, and as to whether the invalidity or incapacity is due to the employee’? own fault, will be a matter to be decided by the Board.

Summarized, the benefits under the Act will be a pension to the contributor, a pension to the contributor’s widow, ana pensions for a deceased contributor’s children up to the age of sixteen.

If an officer retires between the ages of sixty and sixty-five, as he has the right to do under the Public Service Act, or if he is called upon to retire between those years, he is entitled to a pension which is the actuarial equivalent of his contributions, and of the Commonwealth payments in respect thereof.. Of course, it must be less than the full pension, because his contributions end earlier, and his pension commences earlier. He will have the option of contributing in a lump sum or by instalments the actuarial equivalent of contributions to a later age not exceeding the maximum age of retirement.

If an officer is retrenched after ten years’ service, he is entitled to the repayment of all his contributions, and also to the actuarial equivalent of the share of the pension payable by the Commonwealth. He may choose to receive payment, either in a lump sum or as a pension.

If an officer resigns, or is dismissed, or is discharged, he is entitled to a refund of hia. contributions, without interest. Interest is not payable in such a case, because the officer’s risk in respect of invalidity and death benefits has been covered during the whole of the period of service.

When a contributor dies before his retirement, his widow is entitled for her life to one-half of the pension to which the husband was contributing. If a pensioner dies his widow is entitled for her life to one-half of the pension payable to the deceased husband, or to £26 per annum, whichever is the greater amount. If a widow re-marries her pension ceases. If a contributor or pensioner dies, an amount of £13 per annum is payable to the widow in respect of each child until it reaches the age of sixteen years. This does not apply to children of a pensioner’s marriage after retirement.

I purpose now to deal with another class of case - officers who have been retired before the commencement of the Act. The measure has been made retrospective to the 31st December. 1920, because its introduction has been delayed, and the

Bill was definitely promised. It is now proposed to make it retrospective to officers who retired at the age of sixty-five, the usual age, or on account of invalidity, after the 31st December, 1920 There are about 116 “officers who are affected up to the present date. An officer with ten years’ service who was sixtyfive years of age before the commencement of the Act, and retires at any time after the commencement of the Act, will be entitled, without contribution, to a pension, in accordance with his salary, but not exceeding four units, that is to say, £104, which the actuaries declare is about the average pension.

The scheme contains a number of provisions to meet the cases of transferred officers, and enables them to receive benefits under the scheme. The general rule is that the Act shall not apply to employees who have a vested or contingent right to a pension or retiring allowance under any other Act or State Act. Nevertheless, provision is made to enable those who have pensions or other rights under State Acts to get some benefit under the scheme.

It will not be compulsory for any employee to assure his life or continue in force any policy of assurance, and any policy held by the Commonwealth for the purpose of any Act relating to the Public Service will be placed at the disposal of the employee. Any employee whose life is assured at the commencement of the Act may transfer the policy to the Board to continue the payment . of premiums. Where this is done the Board will duly pay the premiums, and, on the maturity of the policy, will pay to the employee or his personal representative the sums received on the policy less the amount of the premiums paid by the Board, with compound interest at 4 per cent, per annum.

Senator Lynch:

– Will the premiums paid by the Board be deducted from the units ?

Senator PEARCE:

– The Board will pay the premiums on behalf of the employee, and on the maturity of the policy will deduct the amount so paid.

Senator Sir Thomas Glasgow:

– Is it proposed to continue the retiring allowance - the long furlough - that is now granted ?

Senator PEARCE:

– Yes; six months furlough for twenty years’ service, and twelve months furlough for forty years’ service.

The Government, in order to check thoroughly the financial basis of the scheme, referred it to an actuarial committee consisting ofH. M. Jackson, F.I.A., F.S.S., Actuary to the Temperance and General Mutual Life Assurance Society; C. H. Wickens, F.I. A., F.S.S., Supervisor of Census; and F. W. Barford, M.A., A.I.A., of the Commonwealth Bureau of Census and Statistics. Mr. Barford acted as secretary to the Committee, which reported as follows: -

As a result of their investigations, and in view of the provisions in the Bill for quinquennial division of rates, the Committee is satisfied as to the sufficiency of the fortnightly contributions set out in the schedules to the draft Bill herewith.

After a general review of the scheme certain amendments were made in the Bill by Cabinet, and the further amended Bill was referred to the Committee. On 15th September, 1922, the Committee furnished a further report, which stated -

We’ have examined the amended copy of the Bill, and have compared the amendments with the provisions that we had beforeus when preparing our report of 23rd September, 1921.

We are of opinion that the amendments which have been made will not have any effect whatever on the sufficiency of the fortnightly contribution, to which we have already certified, as set out in the schedules to the Bill-

In the concluding paragraph of its report the Committee says -

With regard to the cost to the Government in subsequent years, we have’ reviewed the data on which our original estimate was based, and are of opinion that the figures furnished in our report of 23rd September, 1921, will be sufficient to meet the pension payments of the Government in successive financial years, provided the Service retains its present strength, and constitution. Increase in strength or variation in age and

Bex constitution would necessarily cause variation in cost.

That report is on the Bill as now presented to Parliament. I submit the Bill with confidence to the consideration of honorable senators, and I believe that if it is carried it will increase the efficiency of the Service; well lead to contentment in the Service, and add to its attractiveness. Notwithstanding the general impression that the Public Service is very attractive, there is a constant drift away from it. We are losing employees at the rate of about 1,000 per annum, and these are the more ambitious and efficient men. Provision such as’ is made by the Bill should be the means of inducing the better class of employee to remain in the Service.

Senator Lynch:

– The brilliant young fellows may be suppressed deliberately.

Senator PEARCE:

– They may, and that is why the Government regard this as only one of a series of measures dealing with the Service. We do not look upon this Bill as standing by itself, and we do not intend that it shall go forward by itself. It has two complementary measures. One is the Public Service Bill, which has already been passed by this Chamber: That Bill gives a greater degree’ of control, and confers powers upon the Board of Commissioners to deal with disloyalty, want of discipline, and promotion. It gives more effective control to the officers in charge of Departments, and confers on them infinitely greater power than is given by any similar legislation in Australia. We also regard as complementary the proposed measure to exempt all employees receiving a salary of £310 per annum and over, from the operation of the Arbitration (Public Service) Act. The Government say that these three measures must stand or fall together. If they are all passed into law we believe that the joint effect will be not only to make the Service more contented and efficient, but to give the people better value for the money expended.

Senator GARLING:
New South Wales

– I welcome the Bill very cordially indeed. It is a simple act of justice due to men, who have been drawn away from the ordinary avocations of life, and who have been employed under conditions that to a great extent unfit them, after any length of service with the Government, to follow any other calling. It is a simple act of justice, because, for ten years, I suppose, a measure such as this has been held up to the Service as one which was to be brought forward for its benefit. If the Bill were being considered alone, and not in conjunction with the other measures, to which the Minister. (Senator Pearce) . has referred, I would hesitate somewhat to accord it my wholehearted support at the present juncture, but, realizing that, side by side with this Bill, we are bringing into operation machinery that will result in greater efficiency in the Service, and, what is better, than all, procure for members of the Service that reward for merit and efficiency that they are unable to obtain by the rule of thumb methods adopted in the Arbitration Court, where an employee is graded according to the length of his service, and not according to the merit of that service. I can see that those two measures together will result in building up a working machine of infinitely greater efficiency than we have ever had. I am not proposing to-day to enter into any criticism of the second-reading speech of the Minister, who, I hope, will be able to make available to honorable senators a copy of the very clear statement he has just delivered. If honorable senators had an opportunity of considering his remarks between now and, say, next Tuesday, we would be in a much better position to pass the Bill expeditiously than if we had to blunder through it immediately.

Senator Pearce:

– I shall ask that proofs of my speech be made available to any honorable senator requiring a copy.

Senator GARLING:

– I would like to know whether all members of the Naval and Military Services other than clerical employees are provided for under the Bill. I find that the persons regarded as employees are those “ employed in a permanent capacity by the Commonwealth.” I have a clear recollection that, when a previous Bill was before the Chamber, I raised a question on behalf of noncommissioned officers, and other military ratings, and it was made quite clear that such men were not permanent. While the Commonwealth could demand of those men five or three years’ service, those men had no right to demand that their services be retained by the Commonwealth for the full length of such respective periods. Unless they are provided for somewhere in the list of proposed amendments that has been circulated in the Senate, I fear that a great injustice will be done to them. In clause 24, I notice that a contributor who has been in the service for not less than .seven years, and who is retired on the ground of invalidity, or of physical ot mental incapacity to perform his duties, shall be entitled to a pension. That shows that an employee only needs to serve for a period of seven years to entitle him. to the benefits of the Bill. There are men employed in the Naval and Military Forces, who have served for periods ranging from seven to as many as thirty-one years, but who, unless we extend the definition of “employee”, and make it abundantly clear beyond all quest on, are likely to be excluded from the benefits of this wise measure. I have before me a list of no less than seventy-one members of the Royal Australian Garrison Artillery employed at Queenscliff, not one of whom has served less than 9even years, and whose rates of pay certainly do not compare favorably with those of the ordinary civilian employee. Not one of them is drawing more than 3s. 6d. a day. Admittedly they have other . allowances, but that is the rate of their pay Is it clear that they are brought within the scope of the Bill?

Senator Pearce:

– No; it is clear that they are excluded.

Senator GARLING:

– T am glad the Minister has told us that, because it makes our duty obvious.

Senator Pearce:

– They are all on short term engagements, and their engagements have been extended from time to time. In the case of Jong term engagements, officers are brought within the scope of the “Bill.

Senator GARLING:

– Tn that case I should say -that there can be now no long term engagements, or, at any rate, very few of them. Many of the men to whom I refer are. non-commissioned officers. No less than thirty-four of the seventy-one men I have in mind have been permanently employed in the Military Service for a period of fifteen years and upwards, and the whole seventy-one have served for periods of seven years and’ upwards. When a man has been continuously employed for twenty or thirty years, surely his connexion . with the Public Service becomes of a permanent nature. The aim of the measure is to aid those men who, as the time for their retirement approaches, find themselves unfitted to go out into the world and provide for their declining days, owing to the conditions under which they have been employed,’ and the rates of salary paid to them. Many of the men, to whom I have le- ferred, have given service abroad of a character that the ordinary civilian is never called upon to render, and yet it is now proposed that they shall be excluded from the scope of the Bill. I propose, as tb p measure is passing through the Committee stages, to draw the attention of the Senate more closely to this matter, with a view to seeing whether these men cannot be included. 1 am assured by Senator Glasgow that among the proposed amendments distributed among (honorable senators is one to bring this class of employee under the Bill, but I accept the assurance of the Minister (Senator Pearce) that these officers have been excluded.

Senator Pearce:

– I said that they were excluded from the BilL I do not say that there is no proposed amendment under which they would be included.

Senator GARLING:

– Then, the point is open to discussion.

Senator Pearce:

– Certainly.

Senator GARLING:

– These men can be compelled to remain in the Service for a period of five years, but they cannot compel the Commonwealth to keep them in that employ. A sergeant in the Permanent Forces who, I will suggest, is retiring in a few months at the age of sixty, and who has thirty odd years of service to his credit, will, if he be excluded from the operation of this Bill, have to wait five years before being entitled to the only pension he will get, namely, the old-age pension. A gunner who might retire at the age of fifty-five years after thirty years of service would have to wait ten years for that pension.

Senator Fairbairn:

– Are there any gunners of that age?

Senator GARLING:

– Yes. There are thirty-four men among those to whom I have referred, who have put in fifteen years’ service and upwards, and I dare say that twenty-five of them have rendered service of twenty years and upwards.

Senator Pearce:

– Some warrant officers on the instructional staff have thirty-five years’ service.

Senator GARLING:

– I can quite realize that that is so. I have in mind the case of a man which will give point to myplea that these men be brought in under the scheme. Let me, without desiring to put this man’s service personally before honorable senators, because his case is merely typical of many others in the Service, state that a warrant officer - a master gunner at Point Nepean -has. like many others, devoted half his life to the service, and made it his trade.

He holds about the best qualifications he could get. He has had over twenty years’ service, nearly four years of wh’ch were with the Australian Imperial Force and Australian Flying Corps abroad, partly in Mesopotamia, with Townsend’s Division, afterwards in Palestine, and then in France. He belongs to the Australian Instructional Corps, and is a member of the Royal Australian Garrison Artillery, with which regiment he served in New South Wales and in Thursday Island, and is now serving in Victoria. Apparently, after all these years of service, this man, with an excellent record, and many others who have put up similar records, are left out of this Bill, unless, amongst the amendments which I understand are to be proposed by the Minister, there is one whereby they will be restored to the place which, I submit, not only as a senator, but as a member of this community grateful to the men who have done such service, they should occupy under this Bill. I am certain that the public will desire that when the time comes for their retirement these men should be rewarded for service faithfully performed. I ask the Minister to consider what can be done to meet such a deserving class of cases as I have referred to? I do not otherwise intend to discuss the Bill at this stage. I thought, and still think, that there is some doubt as to whether these men would be included in the Bill, and between now and the time when we go into Committee on the measure, the Minister may have an opportunity of looking into the matter.

Debate (on motion by Senator Senior) adjourned.

page 2898

ASSENT TO BILLS. ,

Assent to the following Bills reported: -

Commonwealth Electoral Bill.

Entertainments Tax Bill.

Customs Tariff Bill.

page 2898

CUSTOMS TARIFF (INDUSTRIES PRESERVATION) BILL

Second Reading

Senator EARLE:
VicePresident of the Executive Council · Tasmania · NAT

– I move -

That this Bill he now -read a second time.

This is a Bill the necessity for which in the administration of the Customs policy of Australia has been proved as the result of investigations by the Customs Tariff Board, lt will ‘be quite fresh in the memory of honorable senators that a year ago we passed a Customs Tariff (Industries Preservation) Bill with the object of preventing the dumping of goods into Australia in competition with good? of Australian manufacture, and also with the object of preventing the manipulation of trade in consequence of the depreciation of f.he currency of different countries of the world. One of the most serious aspects of the situation in which -the Customs Department finds itself at present is the enormous depreciation of the currency, particularly of Germany. I am not a finance expert, but I do submit the opinion that, after all, except for the manipulation of invoices, bills of lading, and so forth, the depreciation of the currency of any country does not in actual practice matter very much. I believe that the agitation over the currency question is very much overdone.

Senator de Largie:

– What! In view of the depreciation of the mark from 21 to over 6,000 to the sovereign !

Senator EARLE:

– That is so. Notwithstanding the fact that in. normal times the value of the mark was 21, and to-day it is 6,475 to the sovereign, the German who makes a piano or any other article eats as much brown bread and as much sausage, and drinks as much beer, as he did when the value of the mark was much higher. Consequently, I am of opinion that, except for the trickery of finance in fixing up invoices to defeat our system of Protection, it is not a matter of much consequence in the actual production of goods whether the sovereign is worth 21 marks or 6,475 marks. I think that C. J. Dennis, in a humorous account of his supposed travels in search of fortune, puts the position very tersely. When he is in Germany he receives 6,475 marks for a sovereign, and thinks he has a little fortune, but he is not satisfied. He goes on to Russia and gets as many million roubles, so many that he has to get a waggon to carry them, but”, unfortunately, becoming hungry, he parts with the lot for a meat pie. That is .about what it amounts to, and shows how little advantage there is in the protection of goods by having a depreciated currency. If you can buy an article for a mark when marks are at 21 to the sovereign, and it takes 1,000 marks to buy it when marks are 20,000 to the sovereign, what does it matter so far as production is concerned ?

Senator Wilson:

– Does the honorable senator think that any one quite understands the position of exchange in the world to-day?

Senator EARLE:

– I am taking a practical view of it.

Senator Wilson:

– I did not think that the honorable senator was doing so.

Senator EARLE:

– I do not think that, so far as the production of goods is concerned, it matters very much what is the value of the German mark.

Senator Wilson:

– According to the honorable senator’s argument, the value of the “ pie “ does matter.

Senator EARLE:

– This Bill, it may be noted, proposes the amendment of sections 5, 6, 8, 9, 11, and 12 of the principal Act. The Customs Tariff (Industries Preservation) Act,- which is generally known as the “Anti-dumping Act,” was passed last year to protect Austral’ an industries from the dumping of goods, particularly from countries having a depreciated currency. The Act does not, however, deal entirely with goods coming from countries with a depreciated currency. It provides against various kinds of unfair competition. Section 5 of the Act, which is amended by clause 2 of this Bill, deals with dumping by selling goods in Australia at less than a reasonable price. Practically speaking, it applies to instances where goods are sold to Australia at less than the:r cost of production, or where they are sold without profit to the manufacturer. Subsection 4 of section 5 defines a reasonable price as the cost of production abroad plus 5 per’ cent, plus f.o.b. charges. The Bill seeks to amend the provision, with respect to the addition of 5 per cent., to permit of an addition not exceeding 20 per cent., as determined by the Minister after investigation has been made by, and a report obtained from, the Tariff Board. The 5 per cent, now provided for in the principal Act is a very low rate to add foi- some goods ; but it is proposed that, if the Minister, after a report has been received from the Tariff Board, considers 5 per cent, sufficient, there will, of course, be no increase in such instances. Section 6 of the original Act, to be amended by clause 3 of this Bill, deals with similar instances to those dealt with by section 5, excepting that section 6 deals with goods on consignment, whereas the previous section deals with goods sold to Australia. The amendments proposed to section 6 are on similar lines to those proposed to section 5. It will be seen that the amendment proposed to subsection 4 of sect : on 5 makes the maximum rate 15 per cent., whilst the amendment proposed to sub-section 5 provides for 20 per cent. The reasons for the differentiation are that the 15 per cent, is added to the value of the goods, including freight, insurance charges, and duty, whilst on the other hand the 20 per cent, is added only to the cost of production abroad. It will be noted that neither section 5 nor section 6 of the original Act has anything to do with the matter of depreciated currency. Clause 4 of the Bill, dealing with section 8 of the principal Act, has been’ specially designed to protect Australian industries from dumping from countries with depreciated exchange. Two schedules of the existing Act provide for duties ranging up to a premium of 75 per cent. Those schedules will 6till remain, but when the depreciation gets below the provision of those schedules, that is to say, when the currency depreciates to less than one-twelfth of the normal value, the schedules and advalorem duties will be abandoned, and a specific rate of duty will be substituted. The amount of the new duty will represent the difference between the landed duty paid cost in Australia of foreign goods and Australian wholesale prices of Australian goods.

Senator Wilson:

– So the duty on the article imported will be charged on the basis of the wholesale price in Australia.

Senator EARLE:

– It will really he an advantage to the Australian producer, in that instance, of about 5 per cent. Clause 4, in sub-clause 5, also alters the basis of value for duty. Instead of charging duty on the ordinary value under the Customs Act, the duty will be charged on that ordinary value plus the amount of the dumping duty. The following example will bring the matter more, closely home to honorable senators, and illustrate the operation of the section as amended. If the value of certain goods in Germany is, say, £100, and the freight £10, insurance and f.o.b. charges £3, the ordinary duty (40 per cent.), if calculated in the usual method (£100, plus the statutory 10 per cent.), would be £44, landing charges £2, and profit to be determined as a reasonable turnover profit, £15, making the total landed cost of foreign goods in the warehouse, Melbourne, £174.

Senator Wilson:

– That, in itself, is an increase of 75 per cent, on the original cost.

Senator EARLE:

– If the value of similar goods in Australia were £200, the dumping duty on the foreign goods would be £26, the difference between £174, representing the landed cost of foreign goods, and £200, representing the cost of the Australian commodity.

Senator Senior:

– That would make the duty about 64 per cent.

Senator EARLE:

– Sub-clause 5 of clause 4 now comes in to fix the value of goods upon which the ordinary Tariff will be calculated. This provision means that instead of charging duty on £100 as would have been done in the past, the duty will now be charged on the basic -value of £100, plus the dumping duty of £26, or £126. This means that the £44 appearing as being the duty, if calculated in the ordinary way, is not the actual duty at all. The actual duty will be £55 8s., which provides a small margin of about 5 per cent, in favour of the Australian article.

Clause 5 deals with section 9 of the parent Act. That section was enacted to preserve in the United Kingdom the preference afforded to it by our Customs Tariff of 1921. On most items the preference given Britain is 10 per cent., hut as the value of foreign goods might be tremendously lower than the value of British goods, the preference is more than accounted for by calculating the duty on the British higher value, even after the dumping duty has been charged. It will be remembered that the dumping preference duty is the difference between the foreign export- value on the one hand and the British home consumption value on the other. The amendment means that duty will be charged on the ordinary foreign value plus the amount of the dumping duty.

Senator Vardon:

– Does that mean that the British manufacturer gets “the benefit of the Act?

Senator EARLE:

– Yes; it means that the preference which Australia intended to give Great Britain over other countries will be effective. Clause 6 of the Bill amends section 11 of the Act, which provides against evasion of dumping duties by consigning goods. The appearance of the word “ two “ instead of the word “ three “ was a typographical error in the original Bill. Section 12 of the Act is dealt with in clause 7. That section provides that the various duties imposed by the Act shall be separately charged. There follows a proviso that not more than a total of 15 per cent., can be charged as the result severally or collectively of sections 4 and 7 inclusive. The Bill aims at the removal of this disqualification. ‘Sections 4 to 7 refer to dumping other than exchange depreciation dumping. Section 7 deals with freight dumping in subsidized ships, and restricts the power of the Department to go beyond what is set forth in the Act itself.

One of the principal causes of complaint on the part of manufacturers who may be affected by dumping is the practice of overseas firms in dumping end of season’s goods in Australia. In a sense, this may be regarded as a kind of nation cheap sale. Certain goods have their run at high prices in the country of origin, and, at a convenient time, the residue is shipped to Australia, arriving or the commencement of a similar season.

Senator Payne:

– Or in any other country.

Senator EARLE:

– That is so. The practice is to dump goods in Australia after certain profits on their sale have been made in the country of origin, in much the same way as any business man, after having made his profit on stock, is prepared to offer the remainder at reduced prices. My sympathies are with the Australian manufacturer who has to compete with manufacturers overseas in respect of goods which may he dumped in this country.

Senator Wilson:

– You have very little sympathy for the “ cove “ who has to buy and wear or eat certain stuff that, will be affected by this Bill.

Senator EARLE:

– I have every sympathy both for the manufacturer and the employer of the “ cove “ - as the honorable senator puts it - who has to buy and eat the stuff. I want to see that the employee has the wherewithal to get something to eat. I hope the honorable senator does not intend to raise the whole question of Protection on this measure.

Senator Wilson:

– I intend to raise some objection, at all events.

Senator EARLE:

– I know that, of course.

Senator Wilson:

– Especially when we have the high priest of Protection to deal with.

Senator EARLE:

– I did not expect the Bill to pass without debate, because I know the honorable senator believes in a measure of Free Trade.

Senator Wilson:

– A reasonable Tariff.

Senator EARLE:

– We should remem ber that no matter how cheap certain goods may be, unless we have the wherewithal to buy them - and that may be insured by remunerative employment provided by our secondary industries - their cheapness will not be of any advantage to the consumer.

I think the main features of the Bill may be more effectively dealt with in Committee. The necessity for such a measure has been discovered’ by the Tariff Board, the members of which have amply fulfilled the mission for which they were appointed. I* expected a great deal from the Board, and I am not disappointed. Members of that Board are not only efficient, but thoroughly energetic, and are doing their utmost to give effect to the expressed wish of this Parliament that in Australia we shall cultivate a spirit of self-reliance that is inseparable from the development, on sound lines, of our secondary industries. They have advised that the amendment of the Act is imperative. Therefore, apart altogether from my own views as to the soundness of the policy of Protection, I submit the second reading of the Bill in the confident belief that the recommendations of that Board will have considerable weight with honorable senators. The Board has carried out its work with such determination that I am convinced, not being able to personally go into ali the technicalities and intricacies necessarily associated with Customs administration, that the Bill, which has been introduced on its recommendation, will bc acceptable to those who believe in an effective policy of Protection.

Senator Wilson:

– The Minister did not need any convincing.

Senator EARLE:

– I do not need any convincing, because I have made a life study of the question. I am not a geographical Protectionist like Senator Wilson, who believes in import duties being imposed on marble and other South Australian products, but who is a Free Trader when commodities which are not, produced in South Australia are concerned. I look upon Australia as one great country, and it does not matter to me whether articles which are essential to the industrial life of Australia are manufactured in Queensland, New South Wales, Western Australia, or any other State. If they are manufactured in Victoria, Tasmania will benefit-

Senator Wilson:

– And if manufactured in Tasmania, the whole of Australia pays.

Senator EARLE:

– Quite so. Tasmania, in the near future, will be one of the principal manufacturing States of the Commonwealth, and notwithstanding the fact that its possibilities have, until recently, been ridiculed, it is making wonderful progress. Other countries similar in size to Tasmania have as many millions of people as Tasmania has thousands; but as the Commonwealth progresses, Tasmania will also progress. We must abandon the idea, of depending upon the products of foreign manufacturers, and the policy adopted of providing those articles which are indispensable to our national life is one which has received the indorsement of a large majority of the people. It is only by encouraging Australian manufactures that we can effectively compete with other nations, where the standard of living is much lower than it is in Australia.

Senator MacDONALD:
Queensland

– As I interjected during the second-reading speech of the Minister (Senator Earle), this appears to be one of the Bills which has been introduced in consequence of the approaching election. Throughout Australia there has been considerable consternation, particularly in the minds of manufacturers, as to what was likely to happen when goods from other countries began to flood the Australian market, at very low prices, in consequence of the extraordinary fluctuations in foreign exchange rates. But we heard very little as to the action the Government intended to take, and although considerable criticism has been directed towards their dilatoriness in dealing with a threatening situation, it is not until this late hour that this measure, which is only one of many to be submitted, is brought forward. The Minister in charge of the Bill is a strong Protectionist; but I shall not quarrel with him on that account.

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– Will the honorable senator ask leave to continue his remarks?.

Senator MacDONALD:

– At the suggestion of the Minister (Senator E. D. Millen), I ask leave to continue my speech later.

Leave granted; debate adjourned.

Sitting suspended from 12.54 to 8,80 p.m.*

page 2900

AUSTRALIAN SOLDIERS’ REPATRIATION BILL

Second Reading

Senator E D MILLEN:
Minister for Repatriation · NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– I move -

That this Bill be now read a second time.

I must apologize to honorable senators for the fact that the Bill itself is not yet available for distribution, but I anticipate that copies of it will be in the hands of .honorable senators before the Senate rises. In view of the advantage to senators of having the second-reading speech delivered now, I think they will pardon me for proceeding without the Bill being actually in their hands. There is no intention of continuing the debate at this sitting.

I have caused to be distributed a table which will not form’ portion of the Bill, but is intended to illustrate how the proposed new schedule will operate. For the purpose of my remarks the measure may be divided broadly into two parts. One consists of a series of minor amendments, the purpose of which is to clarify certain ambiguities existing in the main Act, and to give effect to what was clearly the intention of Parliament when it passed the original measure. In the light of later experience it has been found desirable to amplify and tighten up certain powers which the Commissioners have vested in them. I propose to indicate briefly the more important ones, briefly, because they are matters for discussion in Committee rather than on the second reading. One of the amendments, which is typical of the others’, I will explain. It has been found that owing to the draftsmanship of the previous Act the Commissioners had no power to hold property. That is clearly an oversight, because they are made a. corporation capable of suing and being sued, but owing to a defect in the Act their powers are not complete in that respect. Experience has unfortunately* revealed the necessity for tightening up the authority given to them to take proceedings in cases of fraud. I do not want honorable senators to assume that there is any great volume of fraud, but still, there is unfortunately a number of cases in which the Department is being taken advantage of, and it is desirable that the authority , which the Commissioners now have vested in them should be strengthened to enable them to deal with such cases, which is an obvious attempt to take the Department down.

The other, portion of the Bill, which embodies what is really its main purpose, provides for a liberalized scale of payments to limbless and maimed men, who are generally referred to as ‘‘amputation cases.” I do not want the Senate or the country to run away with the idea that the present pensions, which as this proposal indicates, we regard as. too low, are niggardly when they are compared with those of any. other country in the world. Australia has no need to be ashamed. At the time when they were fixed they were thought to be, by comparison with pensions for other classes of cases, fair and equitable, as viewed by the standards and experience of other countries. Further experience has given us a better view of the relative degrees of incapacity which result from the various injuries to which our fighting men have unfortunately been subjected. With the rates proposed in the Bill Australia is placed, as far as these cases are concerned, head and shoulders above any other country in the world in its liberality.

The new schedule submitted with the Bill is founded on one which the Limbless Soldiers’ Association submitted, and the only alterations made in the Association’s proposals are in two directions in which it has been thought desirable to go a little further than the Association asked us to go. The Association has not taken into account, probably because it had overlooked it, one or two forms of amputation which the experience of the Department justified us in believing were entitled to the benefits of the improved schedule. One of the variations from the schedule proposed by the Association is the inclusion of a type of amputation case to which the Association made no reference, and the other is to include in the additional benefits some of those cases known as “ spine cases.” A copy of the schedule was submitted to the Association, and honorable senators will accept it as some evidence of the spirit in which the Association approached the subject when I say that the Association has now furnished me with an assurance that it regards the rates as fair and satisfactory. That statement shows that it approached this matter, cot with a desire to overreach or ask for undue pensions, but, having obtained what it regarded as reasonable, it has volunteered the information that the new rates satisfactorily meet its requests. I received a letter to-day from the president of the Association, who, after having referred to the proposals in the Bill, concluded by saying -

As president of the above body I wish to assure you that the increases proposed will give entire satisfaction.

I put that forward because it is quite reasonable to assume that honorable senators, in their various States, may meet individual nien who will put forward views in favour of something perhaps a little ‘more liberal than the schedule Dro.vides for their particular form of amputation. The Association and the Department, in reviewing the proposals, have had to bear in mind the relativity of one form of disability to another. Acting in that way, and reviewing the problem as a whole, we have arrived at a truer sense of proportion, as between one form of disablement and another, than could be arrived at by one individual considering only his own case. The Association has given some careful though); to the apportionment of pensions, and with those apportionments the Department is able to agree.

The maximum rate of pension at present is £2 2s. a week, except for those cases which come under a special rate and receive £4 4s. I ask honorable senators in considering the Bill to discard from their minds the four guinea pensions. The basic rate of pension at present is £2 2s., and it is proposed to make the rate for serious amputation cases £4. The less serious amputations are graduated down from that amount. I ask honorable senators to keep clearly in mind that the basic change is the substitution of £4 for £2 2s., and if they do that’ they will realize the purpose and scope of the Bill.

Senator Russell:

– Do not some of the most serious cases get free houses ?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– No. The housing scheme does not provide for free houses anywhere, ‘and is not part of the Repatriation Bill.

Senator Elliott:

– Will dependants receive additional amounts?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– No.

Senator Russell:

– I understand that a lot of associations have been formed for the purpose of providing soldiers with free houses.

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– I cannot say what associations have been formed. ‘ It is rather a common practice in this country, when any repatriation matter has to be considered, or statements have to be made regarding repatriation, to ignore the Repatriation Department. The last person who is asked for advice is the head of the Department. Public committees are formed to deal with this and that phase of the matter, and they invite everybody to participate except the Repatriation Department. We cannot be responsible for the misleading information which some of these bodies publish. Many of them make statements which they no doubt believe to be true, but which they could check very easily if they consulted the Department.

Having indicated that the main purpose of the Bill is to lift the pension from £2 2s. to £4, I would like to say how we propose to give effect to it. it is not proposed to disturb the existing pension list at all, but it is proposed to bring in a fifth schedule which, while leaving the old fourth schedule untouched, will provide for supplementary and additional payments. Honorable senators may say, ‘ Why not abolish the existing schedule and put in an entirely new one?” That would necessitate, possibly, a review of all these cases, leaving the present cases exactly as they are, but providing for extra payments per week for every man according to the amputation set out in the schedule. If a man is now receiving £2 2s. a week, it is proposed to give him £4. The proposal in the new schedule will not disturb the existing schedule, but will give the man an additional payment of 38s. That avoids the question which might arise as to what proportion of a man’s present pension was paid because of amputation, and what proportion because of other disabilities. We simply provide that a man who has lost an arm shall get so much a week extra, and that a man who has lost a leg shall get so much- a week extra. We do not entrench upon the pension which a man receives because of disabilities other than amputations. The table I have issued show? exactly how the schedule will work out. I direct attention to the-i fact that the table is prepared on the basis of fortnightly rates. All the pensions are set out in our Act at fortnightly rates, and are paid fortnightly. Taking the last line in the table, it is seen that a man with one arm amputated below the elbow now receives 63s., and under the new proposal will receive 70s. Instead of abolishing the old schedule under which he receives 63s., and substituting a new schedule giving him 70s., we say that he shall retain his present pension and receive an extra payment of 7s. It makes no difference to the total payments to the man, but it does prevent him from being made a possible victim of receiving an extra amount because of his amputation and having it withdrawn from the amount he receives on account of ‘other disabilities.

Senator Elliott:

asked me whether additional amounts would be paid to the dependants of limbless men, and I replied “No.” The Association did ask. at one time, that the pensions of wives should be increased proportionately to the pensions of their husbands. That, I submit, is not an equitable way of dealing with the matter. It is difficult for me to find any reason why we should increase the pension paid to the wife of a soldier suffering from one form of disability unless we also increase the pension payable to the wife of a soldier suffering from another form of disability. I hope the Senate will recognise, as the Bill does, that there is a difference in the disability suffered by a man with a serious form of amputation, as compared with an ordinary pensioner. We meet that by saying that whilst the ordinary pensioner shall get £2 2s., the amputation case shall get £4. Having decided to pay the man according to his disability, I am unable to see why we should also increase the wife’s pension. If we were to say that the widow of a soldier who had been getting £4 should also have an increase, we should find it impossible to resist the logical result of that, and it would be necessary to increase also the pension of the widow of a soldier, only receiving £2 2s., so I cannot see the equity of increasing; the wife’s pension in this case. We are already increasing the husband’s pension by nearly 100 per cent, in many cases.

There were other Bequests by the Association, and some of them I need hardly refer to, because they were largely matters to be determined bv administration, and many of the requests, I am glad to say, have been anticipated. Honorable senators had a memorandum from the Association placed in their hands, and probably they thought that some of the matters dealt with should be attended to, so I shall indicate what the requests were, and what the Department says regarding them. The Association asked, first of all, in its communication to me, that all pensions granted to limbless and permanently disabled soldiers should be granted for life, irrespective of the soldier’s earnings. My answer to that is that those pensions are being paid. A man with ai arm off may be a millionaire, but he gets the pension set out in the schedule. I think the Association was misled when itput forward that request, judging by one or two cases arising under our second schedule. I refer to the £4 per week pension for totally and .permanently incapacitated men. These were defined as men not capable of earning more than a neg ligible portion of their ordinary income. That £4 pension has been wrongly granted to certain men, who were assumed at the time to be unable to earn anything. When it was found, a little later, however, that some of those men had gone back to their pre-war occupations, and were earning full wages, it could not then be fairly, said that they were totally incapacitated. The pension was, therefore, withdrawn, not because they were earning money, but because the pension had been wrongly granted. I think it was a case of that kind that led the Association to think that it was the amount of money a man earned that determined the amount of his pension; but that is not the case at all. It was only to be granted if it was shown that the man was so totally and permanently incapacitated as to be able to earn only a negligible part of his ordinary income.

The Association also asked that the pensions paid to wives ^should be increased in the same ratio as the pensions to husbands. I have just dealt with that point. According to the literature the Association has distributed, it now modifies that request, so as to make it apply to those cases where the pension is less than 75 per cent, of the amount granted in the case of total incapacity, but I see no more reason why we should increase the portion than the whole. We are mak:ng the extra payments to husbands because we regard their .disabilities as relatively greater than they were when the first Pensions Act was passed. In addition to the pension of £4 we provide an attendance allowance for the more serious cases. Take the case of a man who has lost two arms and is wholly dependent on the services of an attendant for the performance of the smallest office in life.

Senator Elliott:

– There are very few of them, I think.

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– There is only one that I know of. Where both arms have been amputated the attendant’s allowance is £2, and in lesser amputations it is £1.

Another request is that, on the death of a limbless soldier, no matter what the cause, or when it occurs, his wife should be regarded as a war widow. I cannot see any more reason to regard the widow of a limbless soldier as a war widow, than the widow of any other soldier. At present a soldier’s wife is regarded as a war widow if her husband dies at any time in consequence of war services. But if, in the course of his civil avocation, he dies, his wife does not become entitled to the pension payable to a war widow. We cannot differentiate between a limbless soldier dying, say, from some epidemic, and another soldier dying from a valvular heart. If we accept death due to ordinary causes in the case of one class, can we refuse it to other classes? We- say, therefore, that .in view of the liberal increase being paid to the limbless men, we see no reason for differentiation between their widows and the widows of other pensioners.

Senator Elliott:

– Will these rates be still subject to re-adjustment if the man proves capable of supporting himself?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– No. The pensions for amputation cases are payable irrespective of whether a man is a millionaire or not. * Even a man so affluent as the honorable senator who interjected would be entitled to the pension if he had lost a limb.

Senator Elliott:

– I thought you said that one of the complaints was that if a man received a pension because of permanent incapacity, and it was subsequently found that be was. able to support himself, the extra allowances would be deducted.

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– That is the case under the second schedule, where £4 per week is provided’ for total incapacity, but the pension” might not have been granted on account of amputation at all. I said that probably the request of the Association arose from some ambiguity as to the real purpose of the second schedule. This schedule was regarded as something quite apart from the ordinary schedule rates, and it was decided that where a man waa so permanently incapacitated from any cause as to prevent him from earning more than a negligible portion of his income, he was to receive £4 per week. In one case the Commissioners gave a man the benefit of the doubt, and they found, a few weeks afterwards, that he was earning his former wage. Clearly such a man would not be entitled to the £4 pension.

If honorable senators will take the trouble, as they should do, to in spect what the Government are doing for these men in such places as the Anzac Hospital, they will see that they are maintained, not only liberally, but sumptuously. The men have the option of residing at a hospital and drawing the pension of £2 2s., or of living outside and drawing £4 a week. That reminds me of one of the new provisions that I think honorable senators will readily assent to. Under the existing law it is provided that men receiving that special rate of pension can only draw it when they are not members of an institution, but it is found from experience that a man may be living out-‘ side, and it may be necessary for him to enter a hospital for medical treatment, or for an operation. At present, we have to withdraw the pension when he enters the hospital, but his home has to be maintained just the same, and it is obvious that temporary residence in an institution was never intended by Parliament to deprive him of the full benefit of his pension. It is now proposed, therefore, that, where the recipient is an inmate of an institution for a short period only, the special pension is not to be withheld.

Senator Russell:

– The hospital at Brighton is practically a palace. There is a committee of “over 200, and the in» mates are taken to picture shows twice a week.

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– I hope honorable senators will make themselves acquainted with the way the institutions are conducted. Everything that can humanly be done to bring sunshine to the lives of the men is being done.

Senator Sir Thomas Glasgow:

– Where there is a special case of total disability, and the man is outside an institution, is there any allowance for attendance?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– He will receive £4 per week, 18s. for his wife, and an allowance for children, and, in addition, the Bill proposes to grant him an attendance allowance of £1 per week. It was necessary to .provide that this allowance should be paid in such cases as the Commissioners thought fit. We had a blind case recently- or so it was described medically - and the man had been in one of our institutions. He wanted to go to his home, and not long afterwards his wife proceeded against him for as- sault. She alleged that he- had chased her round the room with a chair.’ We might conclude that in that case an attendant was not required for the man, however necessary it might be to provide one for the wife and the neighbours. Spine cases, so medically described, cover quite a wide range of cases, and so it is proposed in spine cases to leave to the Commissioner the right to determine whether the increased pension should be paid or not.

The Limbless Soldiers Association has further asked that in assessing pensions all other disabilities arising from war service be taken into consideration, even if such disabilities are not cited on the medical history sheets. This is rather a matter for administration, and I am pleased to inform the Association that what they propose is what is done to-day. To do otherwise would be, not to help the Department, but it might be to injure the soldier. Very often a soldier discharged for perhaps five years reveals some disability, and the question arises whether that is due to war service or to his civil avocation. It is very often found on reference to the medical history sheet that the seeds of his new trouble were sown during his military service, and the reference more often helps than injures the soldier. The Department holds the view that a reference to’ the medical history sheet very often discloses information necessary to enable the medical ‘officer to arrive at a correct diagnosis of present trouble. I venture the opinion, and I ask honorable senators to accept it, that this practice helps rather than injures the soldier. A reference to the previous medical history may create a doubt, and the man will get the benefit of that doubt. The suggestion of the Association .in this regard is due, probably, to knowledge of some particular case, but one of the greatest difficulties in the world is to solve a problem by the consideration of individual cases. It is an old maxim that “ hard cases make bad laws.” There may be one or two cases to which sufficient consideration has not been given, but it will be agreed that here and there a cog may slip in such a big Department. It is impossible to believe, in view of the very large number of cases that have to be dealt with, that occasionally mistakes will not be made. It is possible on one or two cases to generalize too much, and on the whole, I am satisfied that the Department is acting wisely and in the interests of the men in the course it adopts.

The Association further asks that where knee or elbow action is lost or affected, below knee and below elbow amputation should be treated as above knee and above elbow amputation. That is done under this Bill, which makes it clear that although it might appear that an amputation below the elbow might be met by a somewhat lower pension than an amputation above the elbow, if the amputation is of such a character that the elbow joint has gone or if the limb without any amputation is held to be as useless as if it were amputated, the disability is regarded as an amputation for which the soldier should be paid the higher rate of pension.

The Association asks also for an increase of the pension payable to a man who has lost one eye. The pres’ent rate of pension for the loss of one eye is the 50 per cent, rate, or £1 ls. per week. In view of the pensions paid in respect of other disabilities, I think that that cannot be considered an unfair pension for the loss of an eye. There are many eases in which smaller pensions are paid for disabilities which one might be disposed to consider represented a greater handicap in life to the soldier than the loss of an eye. In view of the whole scale of pensions, I suggest that men who have lost an eye are not treated unfairly when compared with men suffering from other forms of disability.

Senator Garling:

– Are there many men who have lost an eye?

Senator E D MILLEN:
NEW SOUTH WALES · FT; ANTI-SOC from 1910; LP from 1913; NAT from 1917

– I do not know that there are, but I am not influenced by the number of men suffering from a disability so much as by the nature of the disability and the handicap that it represents. I think that that is what will weigh with honorable senators.

I believe I have dealt with the main requests received from the Limbless Soldiers Association, and have not neglected to refer to any matter of importance. I shall endeavour to have the Bill distributed to honorable senators before the Senate rises, in the hope that we may be able to proceed with the discussion of the measure on the resumption of our business next week.

I need only add, I think, that honorable senators will probably agree that it is not the most pleasant position in the world to be a Minister, who is occasionally called upon to say “ No “ to requests in these cases. One’s sympathy is naturally aroused when he sees a man suffering considerable physical incapacity. When a request is made for a certain rate of pension he may be disposed, in many cases, to be even more liberal than is provided for under this Bill. But when one considers the whole scheme and remembers that we have to deal with the ordinary facts of life he is frequently compelled, as T have been, to say “ No “ in cases where his sympathies would induce” him to say “ Yes.” I ask honorable senators to bear that in mind. It is quite easy when we propose a pension of £4 per week in these cases for some one to suggest that the pension should be £5, £6, or £7. I should not want to say that either amount would be too much, but we have to pay some regard to the total liability involved, and to what is a fair thing to the men all round. It might be suggested that the pension should be equal to a standard living wage, and in serious cases the pension provided for amounts to considerably more than that. Many men are drawing from £6 to £7 per week, including allowances to wife and children. On the whole I am encouraged by the fact that the Limbless Soldiers’ Association is generally satisfied with the scheme proposed, and I submit the Bill to honorable senators with every confidence.

Donate fon motion by Senator Macdonald) adjourned.

page 2906

CUSTOMS TARIFF (INDUSTRIES PRESERVATION) BILL

Second Reading

Debate resumed (ride page 2900).

Senator MacDONALD:
Queensland

– I was saying when the debate on the second reading of this Bill was adjourned, that I do not altogether dissent from the attitude taken up by the Minister in charge of the measure (Senator Earle). As I mentioned in a previous debate I stand firmly for the principle of a self-contained Australia, not only in the matter of de fence, but also in the matter of secondary and primary production. Secondary production is the matter with which this Bill is concerned. In my view we should have in this country every possible form of secondary industry that can be profitably engaged in. I agree with the Minister that it is necessary to protect Australian manufactures from the evil effects of the dumping of imported goods, the product of cheap labour. When this measure is forced upon our attention by the Government in the dying hoursof the session it is difficult to avoid the impression that it represents an appeal to the electors. If it had been introduced much earlier the people of Australia might have been spared a good deal of alarm created by the statement that cheap goods of German manufacture were being rushed into this country. Whilst I am in favour of a sufficient measure of protection for our secondary industries against the importation of cheap foreign goods, we should protect local consumers and those engaged in the primary industries of the country from the possible operation of anything like a local manufacturing combine that might attempt to squeeze them beyond all bounds. I have nothing further to say at this stage of the measure, and I will be prepared to assist its passage through Committee.

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clause 1 agreed to.

Clause 2-

Section 5 of the principal Act is amended by omitting from sub-section 4 thereof the words “5 per centum,” and inserting in their stead the words “ such addition, not exceeding 20 per centum, as is determined by the Minister after inquiry and report by the Tariff Board.”

Senator FAIRBAIRN:
Victoria

.- We are dealing with this Bill very hurriedly. There is a matter which I do not quite understand, but which I think comes under this clause. We want to protect the British manufacturer against manufacturers in countries where the currency has been depreciated to an extraordinary extent. This clause deals with the definition of a reasonable price, and as I understand it the price of a motor car, for instance, is taken to be the price at which it is sold in Great Britain. I am told that a British car is exported at a considerably lower price than it is sold for in Great Britain.

Senator Earle:

– Is that not a species of dumping, if the article is exported to Australia at less than the price for which it is sold in the. country of manufacture?

Senator FAIRBAIRN:

– There is very little done here in the manufacture of motor cars, and I understand, therefore, that the object of the clause is really to protect the British manufacturer of motor cars against those of other countries. Still I do not think that the British manufacturer should be protected to the extent proposed. Under this Bill he would get 20 per cent, protection, and I do not desire that he should be given further protection by permitting him to export his cars to Australia at a lower price than a foreign car is assessed at for duty. I would suggest to the Minister that the clause might be postponed in order that more time might be given to consider what its effect is likely to be. It would be fair to assess the value of, say a’ motor car or an implement at the price at which it was exported or at which it was sold locally, whichever was the lower. That would not interfere with the price in Australia. Our manufacturers would still have an ample protection of 20 per cent., plus the freight, and, therefore, should not be under any disability. I have not had time to look into this matter myself. I hope, therefore, that the Minister will give careful consideration to this point.

Senator EARLE:
VicePresident of the Executive Council · Tasmania · NAT

– I would like to meet Senator Fairbairn’s request, but the Department is particularly anxious to have the Bill passed, in order to deal with certain specific cases of goods which may be brought in at under fair market value through depreciation of currency in the country of origin, and other cases in which goods have been invoiced at under their actual value. The Act provides that the duty shall be levied upon the value in the country of origin, plus, roughly, 10 per cent., but, in practice, it is found that not only is the Customs Department defrauded, but that the manufacturers of Australia are not getting that protection which Parliament intended them to have.

I doubt very much whether the clause really covers the question raised by Senator Fairbairn, but if there is an anomaly - I do not think it can be very serious -

I ask him to overlook it, and allow the Bill to go through. It is the result of very mature consideration by members of the Tariff Board. I am submitting another measure, one’ to amend the Customs Act, to bring it into conformity with the two alterations in our Customs law, which also is very necessary in the interests of our manufacturers.

Senator FAIRBAIRN:
Victoria

– The Minister (Senator Earle) says that it is necessary to get this measure through. I agree with him. But, surely, to introduce a- Bill in the morning and expect tq get it passed in the afternoon is rushing things a bit, and not quite in accordance with ordinary common sense, in my opinion. The Minister might very well adjourn the debate until the next day of sitting. That will only be -two or three days hence. In the meantime, we could look into the question and be in a position to say whether it is a reasonable Bill.

Senator EARLE:
VicePresident of the Executive Council · Tasmania · NAT

– I am anxious to meet Senator Fairbairn’s wishes, and at the same time I desire to have these measures cleared off the business-paper, because there is a considerable amount of other work before the Senate. I think that if I agree to allow the Bill to remain in Committee over today, that should meet Senator Fairbairn’s request, if there is no objection to any of the “other clauses.

Senator Keating:

– There is objection to every one of them.

Senator EARLE:

– In the circumstances, then, I will agree to report progress. .

Progress reported.

page 2907

CUSTOMS BILL

Second Reading

Senator EARLE:
VicePresident of the Executive Council · Tasmania · NAT

.- I move-

That this Bill be now read a second time.

This Bill is incidental to the other measure which is under consideration in the Committee of the Senate, and it is the desire of the Customs Department to have it passed concurrently with that measure. It is practically confined to an alteration of section 154 of the Customs Act and amendments of the machinery provisions of that law. It is very closely related to the Bill amending the Industries Preservation Act, which is now before the Senate Committee. Section 2 of the Customs Tariff (Industries Preservation) Act - the original Act - provides that the Act shall be incorporated and read as one with the, Customs Act. This is necessary to enable all the machinery provisions of the Customs Act to be used in connexion with the collection’ of these duties under the Dumping Act. A very strong recommendation has been made by the Tariff Board for the amendment of the basis of assessing duty under the Customs Act. The Bill follows precisely the recommendations of the Tariff Board. The existing practice is to compute the duty on the fair market value of the goods in the principal markets of the export country. The value is taken whether it is higher or lower than the money price which the Australian is paying for the goods. The proposal in this Bill is to charge duty on that fair market value abroad, or on the price which the Australian importer pays for the goods, whichever is the higher duty. This is the only principle involved in the Bill. The other amendments are merely consequential to the introduction of that principle, or definitions of terms to give effect thereto. It will be noticed that in the Bill the term “ current domestic value “ is used. This term is synonymous with fair marketvalue, as used in the parent Act.

Senator Keating:

– It is defined in this Bill, but where doe3 it occur in the Act itself?

Senator EARLE:

– The reason for the change of term is that the expression “ current domestic value “ was recommended for adoption by a London conference last year. The conference was between representatives of the London Board of Trade and representatives of the Customs of all the Dominions. It might be mentioned that for some time, when prices were soaring rapidly in the period 1917-1918, the revenue benefited considerably by that provision. Th» reason for that was that the prices would rise after the goods were ordered from Australia, and duty would have to be paid on the value in the foreign country at the date of shipment to Australia.. Then came a period when values were rapidly falling, and the importer, as a general rule, got back all that he had lost to the Department in the earlier periods. In the present period and generally, in norma] circumstances, the two prices, *i.e., the price in the country of export for home consumption and the* price at which goods are sold to Australia, would not differ at all in bond fide trade circumstances. Where they might differ is where goods are being sold to branch houses at specially low rates because of the relation between buyer and seller - or in the case of, particularly, Eastern merchants who invoice their goods to Australia at c.i.f. prices. In these instances the merchant here pays duty ‘ on those c.i.f.’ prices after deducting therefrom the freight and other non-dutiable charges. The Eastern merchant has a way of inflating the non-dutiable charges and relatively reducing the value upon which duty is paid. The honest trader will be far better protected under this new provision than he was under the old. Another important point from the mercantile view is that the present system frequently necessitates inquiry abroad as to the fair market value, and it has been, unfortunately, necessary to call upon merchants many months after original payment for the payment of ‘additional duty. The Tariff Board reports that the new principle will, to a very large measure indeed, remove the necessity for such action. The provision for levying duty on the higher of these two prices is already in operation in Canada and South Africa, and the latest proposal of the United States Government is to amend their Customs Act to the same effect. The Imperial Government goes even further, and charges duty on importations into the United Kingdom on the c.i.f. and e. price. The new .provision will greatly reduce the number of investigations which it has been found necessary to make in the countries of export, and will avoid delay caused by inquiry, and the resultant dissatisfaction arising from the adjustment of duty short paid. It is confidently anticipated that experience will prove to Australian importers that this proposal will not add to their work nor greatly to the duty they will have to pay from the United Kingdom, but rather will greatly decrease work, largely dispense with the most objectionable practice of charging back duties, avoid innumerable deposits of duty, and constant presentation of documents already dealt with. It will also mean that the Australian manu- facturer will receive the protection Parliament really intended to give him, but which is not secured by the present practice. The fact that other Dominions and countries have seen the necessity for alteration should hasten its adoption by the Commonwealth. It is to be expected that with the intention of avoiding the dumping duties provided by sections 8 and 9 of the Industries Preservation Act, manufacturers in affected countries will increase their invoice values so. as to enable their customers to escape payment of the heavy penalty duties. The manufacturer will, of course, gain by this action if the increase is genuine. While duty is payable on the basis of current domestic value, there is nothing to prevent exporters falsely declaring to higher invoice (selling) prices, and drawing on buyers only for the proper amount. The false declaration would enable duty to be evaded as the evidence of detriment to Australian industry would be concealed. If the price shown on the invoice as the price charged to the Australian importer is higher than the declared current domestic price, it is essential, in the interests of local industries, that the duty should be, charged on that value, otherwise the benefits of the Industries Preservation Act will be nullified. It is necessary to mention that the current domestic values are necessarily shown on invoices in the currency of the country of export. Existing law allows them to be converted to sterling at the exchange rate ruling at the date of export. This is in accordance with the decision of the High Court in a recent test case. It is quite a regular thing for invoices from Czecho-Slovakia - which country’s currency has depreciated to one-eighth of its normal value - to show current domestic values which, converted at the exchange ruling at date of export, give a value for duty about one-third of the price charged for the goods, and scores of such have come under notice. A similar state of affairs exists, although not so pronounced, in respect of importations from other countries with depreciated currencies, such as Italy, France, and Belgium. If, as a result of the depreciation of a currency to one-eighth, as in the case of Czecho slovakia, declared current domestic value can bo reduced to one-third the selling price to Australia, it is obvious that the German mark having depreciated to l-200ths of its normal value, the declared domestic value on which duty is at present payable might genuinely be reduced to l-50th of the price charged to the Australian purchaser. If such a result really happened, it is obvious that the importer here would only pay l-50th of the duty that Parliament meant him to pay, and that Australian industries would only be protected to the extent of onefiftieth of what Parliament intended. It is clear that Australian industries will be doomed if actual happenings reduce the duty payable to even one- tenth of the proper duty. But there seems good reason to believe that a much larger reduction is likely. The remedy suggested in the draft Bill is that duty shall be based upon the price which the Australian purchaser pays for his goods or on the current domestic value, whichever is the higher. Unless this alteration of section 154 is approved, section 9 of the Industries Preservation Act will be wholly ineffective to protect British industries. At present the penalty duty may be imposed, but the value for duty is the domestic value in Germany. The most effective method to check attempts to defeat Australian and English industries is to require payment either on the domestic or export price, whichever is the higher. Nor is this danger confined to countries with depreciated currencies. Apart altogether from the present abnormal position of the world’s trade, the two countries against which this protection is most needed are America and Japan, both countries having appreciated currencies. Before the war the necessity for this alteration was clearly emphasized, but officers were not generally supported. Tt is worthy of mention that the two business members of the Tariff Board, after very fully and carefully studying the position, strongly support the officers in their request for the proposed amendment of section 154. Consequential amendments are also proposed for sections 155 and 156. of the main Act, but these do no more than make the necessary provision to give effect to the suggested alteration to section 154. The measure has been introduced after a thorough investigation, of the situation by the Tariff Board, and the Department is convinced of the necessity of such a Bill. Section 154 of the Customs Act must be amended in order to give effect to the will of Parliament.

Senator Keating:

– But this repeals sections 155 and’ 156.

Senator EARLE:

– Those amendments are largely of a machinery character, and the main purpose of the measure is to repeal section 154. In view of all the circumstances, I do not think honorable senators will oppose the Bill.

Debate (on motion by Senator Keating) adjourned.

page 2910

IRON AND STEEL PRODUCTS BOUNTY BILL

Second Reading

Senator EARLE:
VicePresident of the Executive Council · Tasmania · NAT

.- I move -

That this Bill be now read a second time.

Honorable senators will remember that reference was made to this measure when the Customs Bill was under consideration. It was intimated that the. duty on wire, wire-netting, galvanized iron, and also traction engines, would be remitted, and that the position would be met by the payment of bounties. This measure is to give effect to that promise, and the only point which may require explanation is in connexion with clause 2, which defines fencing wire. Reference is made to the Tariff item 13 6e, because under that item there is power to extend the provision by by-law. The definition is worded in such a way that bounties may be paid upon any wire delivered under the reduced Tariff rate provided in a recent amendment. A similar provision will, of course, apply in all the other instances in which bounties will be payable on all lines on which the duty has been reduced. Clause 3 relates to power to pay bounties. It will be noted that the bounty will be payable on goods delivered from Australian factories on and after the 14th day of September, which is the date on which the Tariff reduction will take place. The proviso in clause 3 is the usual proviso in bounty Bills, designed automatically to cut out or reduce the bounty if clrcumstances should at any time warrant the bringing down of a proposed resolution restoring the Tariff on (he articles covered by the bounty.

Senator Lynch:

– Do the Government propose to pay a bounty on the actual amount manufactured?

Senator EARLE:

– The total expenditure will be £250,000 a year, and regulations will be introduced to provide for the apportionment of that amount of money over the different industries provided for under the Bounties Act. Clause 4 is inserted as a safeguard against a manufacturer being forced by a purchaser to defeat the object of the measure by transferring the advantage of the bounty from .the manufacturer to some other party. The provision in sub-clause 2 of this clause scarcely requires explanation. It may safely be assumed that the Minister will not authorize the use of imported articles except in some emergency. Honorable senators will notice by the Bill that it is intended that all material in the manufacture of the articles upon which the bounty is paid shall be, as far as possible, Australian; but the Minister may grant permission for the use of imported material.

The amount stated in clause 5 is £250,000 a year, which is the amount to be expended on the bounty. Clause 6 requires that the Department shall receive satisfactory proof that the articles have been manufactured in Australia before the bounties are paid, while clause 7 provides for an audited account of the works upon which the bounty is demanded beir/g presented to the Government. No action is contemplated under clause 8 unless there is evidence that the main object of this legislation is being defeated. Th:s section would not be put into operation unless there was reason to believe that the consumer was not getting the proper advantage that should accrue to hiin under the provisions of the Bill. The clause provides that the Minister, if he is not satisfied that the manufacturer is selling his goods at a reasonable price, may withhold the bounty. Therefore, if under any circumstances the manufacturers of these articles in Australia obtained a monopoly, and sought to exploit the public, they would not be encouraged by the payment of the bounty.

Clause 10, honorable senators will notice; provides for certain conditions in regard to labour. The Minister, if he is not satisfied with the cond tions under which the employees in the industry are worked or paid, may invoke the interference of a Judge of the Arbitration Court to make an award. While the nation is paying a considerable sum of money, in the interests of the farming community principally, the Government think they should take steps to insure that the artisans who provide the materials get fair treatment. There is a further clause increasing the penalties under existing Acts from £100, or s;z months’ imprisonment, to £500, or twelve months’ imprisonment, for breaches or infringements. It is considered necessary to make that alteration in view of the fact that a very much larger amount of money is involved than has been the case under any similar Act in Australia previously. As honorable senators are familiar with the Bill, and must have anticipated it in consequence of what was said in the Budget statement and in my own speech on a previous Bill, it is quite unnecessary for me to make any further explanation.

Senator Lynch:

– Do , the Government propose to pay a bounty upon galvanized iron which goes into consumption in the city areas?

Senator EARLE:

– It is impossible to differentiate between iron which is used in provincial and country centres. The honorable senator means that the bounty ought to be paid exclusively for the benefit cif country residents. I quite sympathize with his point of view, but it would be quite impracticable to give effect to it.

Debate (on motion by Senator de Largie) adjourned.

Senate adjourned at 3.56 p.m.

Cite as: Australia, Senate, Debates, 29 September 1922, viewed 22 October 2017, <http://historichansard.net/senate/1922/19220929_senate_8_101/>.

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