Senate
7 December 1960

23rd Parliament · 2nd Session

  1. Senate
  2. 23rd Parliament
  3. 1960

The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.

page 2123

QUESTION

THE SENATE

Senator McCALLUM:
NEW SOUTH WALES

– I ask you a question, Mr. President. In view of the rather poor lighting and the bad ventilation of this chamber, which have somewhat impaired our labours during the last few days, are there any steps you can take or have taken to improve those matters?

The PRESIDENT:

– The air in this chamber is the purest air you can possibly have. It is Canberra air which is brought in, washed, cooled, and then put over an ionized screen to prevent germs from coming into the chamber with it. The temperature is checked continuously and the air in this chamber and the other chamber is checked every half hour. The lighting was installed in 1927 and despite the many inquiries and tests we have made up to date, we have not arrived at any better system of lighting than we have at present. The matter of lighting is being very carefully investigated by experts from outside firms in Melbourne and by the Department of Works. I hope to have an improved system of lighting introduced in the future, but for the time being honorable senators may take my word that the air in this chamber is as pure as it can possibly be made.

page 2123

QUESTION

CONSTITUTIONAL REVIEW COMMITTEE

Senator BROWN:
QUEENSLAND

– My question is directed to the Leader of the Government in the Senate. Is the Minister aware that a report of. a possible double dissolution has disturbed the mental serenity of a few federal legislators? Will the Minister kindly direct the attention of his fellow workers in the Cabinet to paragraphs 204 and 205 of the most excellent report by the Constitutional Review Committee presented in 1959? Those paragraphs read - 204. The Committee recommends that, upon a deadlock arising, it should be within the power of the Governor-General, acting on the advice of the Federal Executive Council, to convene a joint sitting of the members of the two Houses as an alternative to double dissolution. The joint sitting should deliberate and vote upon the proposed law in dispute together with any amendments which have been made by one House but not agreed to by the other. 205. The committee recommends that a disputed bill should not be affirmed at such a joint sitting unlesss it is approved by an absolute majority of the total number of members of the two Houses.

Finally, will the Minister recommend that action be taken to write into the Constitution the excellent recommendations of the Constitutional Review Committee and thus help to restore to peaceful normality the mental processes of our perturbed legislators, or in other words, place the whole stupid business of double dissolutions on a reasonable and intelligent basis?

Senator SPOONER:
Minister for National Development · NEW SOUTH WALES · LP

– Mr. President, I sympathize with Senator Brown and his colleagues in the Labour Party at the prospect of a double dissolution. They have, of course, every reason to be apprehensive of such an event coming to pass. The honorable senator has referred to recommendations of the Constitutional Review Committee. I will let him and the Senate into a secret by saying that at present the recommendations are under consideration.

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QUESTION

IRON ORE

Senator LILLICO:
TASMANIA

– Has the Minister for

National Development noted the statement by the Premier of Tasmania, Mr. Reece, to the effect that he is opposed to the export of iron ore from the Savage River area? Does the Minister agree with this contention?

Senator SPOONER:
LP

– I agree in the broad with the statement by Mr. Reece, the Tasmanian Premier, about exports of ore from this deposit; but I should like to have an opportunity to talk to him about it. The policy of the Commonwealth Government is that we should process as much iron ore as possiblein Australia. The Savage River deposit is, by all accounts, a very large one, but the ore has characteristics that do not make it readily usable, and extensive tests may be required before it becomes attractive. There will be a good deal of competition for iron ore, and I expect a number of new deposits to be discovered and to become available. I hold the view that Tasmania would have much to gain from getting this deposit opened up as soon as is practicable, and the easiest way to do that would be to find some one overseas who would use this ore. The deposit would have to be thoroughly explored and then access roads would have to be provided. After that some of the ore could be exported. At this stage, as is contemplated in the general policy of the Government, we would turn our thoughts to processing the ore in Australia.

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QUESTION

CIVIL AVIATION

Senator O’BYRNE:
TASMANIA

– My question is directed to the Minister for Civil Aviation. In view of the aggregate amount of time lost annually, to say nothing of the personal discomfort to delayed passengers, as the result of aircraft throughout Australia circling fog-bound aerodromes while waiting for fogs to disperse, what measures are proposed by the Department of Civil Aviation in the foreseeable future to install fog inhibition and dispersal equipment at fogprone airports such as those at Launceston, Canberra, Mackay and many other places throughout Australia?

Senator PALTRIDGE:
Minister for Civil Aviation · WESTERN AUSTRALIA · LP

– It is a fact that from time to time aircraft are delayed as the result of fog. I doubt whether it is true - in fact I am sure it is not - that the delay caused by fogs is of the order suggested in the honorable senator’s question. I have no hesitation in saying that the technical installations of the Department of Civil Aviation in Australia are, all things considered, comparable to other such installations in any other part of the world. The department keeps up with developments in this field as they occur. I do not think it would be wise for me to try to tell the honorable senator the details of the technical progress that has been made and is in mind. Knowing his interest in these matters, I shall ask the department to prepare a statement for him so that, from his own knowledge of the subject - which is greater than mine - he will be able to see that the department is not lagging behind in any respect.

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QUESTION

IRON ORE

Senator SCOTT:
WESTERN AUSTRALIA

– I should like to pre face my question, which is addressed to the Minister for National Development, by congratulating the Government upon its recent decision to lift the embargo on the export of iron ore. I ask the Minister: What is the position in regard to the export of iron ore from small deposits in Australia? Has any agreement been reached between the Commonwealth and the States in regard to the lifting by the State governments of the blanket on the pegging of iron ore deposits so that prospectors, confident of a reward, may begin a programme of exploration for new deposits?

Senator SPOONER:
LP

– There are a great number of small deposits of iron ore in Australia; but they have not been tested or proved, because there is no immediate use for them. I should think very good opportunities exist for entrepreneurs to prove those deposits and to seek markets for them. As to the matter of Commonwealth and State relations, the Premiers have been informed of the change in Commonwealth policy, which puts any State in the position in which, when granting a title to a specific deposit, it may reserve to itself the right to say whether or not the iron ore may be exported.

I would hope that the States would be decisive about saying whether they thought particular deposits should be reserved for the purpose of establishing an industry within their boundaries, so that prospecting could proceed with a degree of certainty. I hope they would be hesitant about putting an embargo upon export trading, particularly as the formula which operates is deliberately aimed at conserving resources. No one will get carte blanche to export. There is a maximum amount that can be exported, and a period of time is fixed. There will be no chance of any one having discovered a big deposit, enjoying an indiscriminate right to export the metal that is won. In view of the very good co-operation which exists between the Mines Departments of the States and the Bureau of Mineral Resources, I believe that the formula alone will give very good protection to each State.

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QUESTION

WHEAT

Senator McMANUS:
VICTORIA

– Has the Minister representing the Minister for Primary Industry received representations from wheat-grower organizations, particularly in Victoria, protesting against the Government’s proposal in regard to crop payments that are soon to be made? What are the reasons for the Government’s decision in this matter?

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– I personally have not received any representation from the wheat-grower organizations in Victoria, and I am not aware whether the Minister for Primary Industry has received any. I shall ask my colleague to inform the honorable senator whether he has received any such representations.

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QUESTION

TREE PESTS

Senator HENTY:
Minister for Customs and Excise · TASMANIA · LP

– On 8th November last, Senator Hannaford asked the following question: -

Will the Minister representing the Minister in charge of the Commonwealth Scientific and Industrial Research Organization inform me Whether the attention of that body has been directed to the destructive effects of a certain microscopic insect, which I believe is known as the lerp, on the eucalyptus trees in Canberra? As the eucalyptus trees over areas of South Australia appear to be similarly affected, will the Minister take up this matter with the C.S.I.R.O. with a view to having the incidence of this pest investigated to determine whether any measure of control could be exercised in relation to it? I understand that the activities of this pest are having a serious effect on gum trees in large areas of Australia.

The following answer is now supplied: -

The lerp insects belong to a family of sapsucking plant bugs known as the psyllidae. There is an enormous number of species in Australia, and many of those occurring on eucalyptus build a small waxy covering or scale on the leaf to protect themselves. This scale is known as a lerp.

The Division of Entomology, C.S.I.R.O., began studies on the lerp insects damaging eucalyptus trees in Canberra in about 19S3. Work has been concentrated on the species attacking red gums, eucalyptus blakelyi, in the Australian Capital Territory, but subsidiary studies have been made On the same or closely related species over wide areas in southern New South Wales and Victoria. The most important species damaging pink and red gums in South Australia are closely related to the one in the A.C.T. An officer of the Waite Institute has also made some studies in South Australia.

Normally outbreaks of these species are intermittent and of short duration, and tree mortality is negligible. The present outbreaks in the A.C.T., and in some other places have persisted for ten years, but even in the localities most seriously affected where the trees are fairly dense, no more than 25 per cent, have been killed.

The studies by the C.S.I.R.O. have been mainly ecological, with the object of obtaining, an understanding of the causes of these outbreaks, and taking into consideration the weather, para sites and predators, changes in land use and so on. It is hoped that some method of control other than the use of insecticides will emerge from these studies, for it is obvious that the spraying of large tracts of woodland would be difficult and uneconomic. There are many species of lerp insects, each one confined to one species or group of species of eucalypts. In the A.C.T., for instance, the long-range solution to the problem could be the replacement of eucalyptus blakelyi by other species not affected by the lerp insect which is now causing such obvious damage.

Where the cost of treatment is justified, it is not difficult to protect trees which have particular value for ornamental purposes. Such trees are sprayed regularly, with good results, by the Parks and Gardens Section in Canberra.

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QUESTION

SHIPPING FREIGHTS

Senator LAUGHT:
SOUTH AUSTRALIA

– My question is directed to the Minister representing the Minister for Shipping and Transport. Is it not a fact that shipping freights for refrigerated meat cargoes consigned from Australia to the United Kingdom and to European ports are higher than freights for similar cargoes consigned from New Zealand to the same destinations? Is it not also a fact that the differential, which is adverse to Australia in all cases, is 40 per cent, for frozen beef, 18 per cent, for frozen carcass mutton, 24 per cent, for frozen lamb, and 50 per cent, for chilled beef? Will the Minister ascertain the reason for these marked differences, despite the fact that the distance from Australia to the destinations 1 have mentioned is shorter than that from New Zealand? Is it the Minister’s view that the negotiations conducted by and on behalf of Australian producers with overseas shipping interests are carried out in a sufficiently forceful and adequate manner? Can the Minister suggest ways in which this freight differential, which is so adverse to the Australian meat export trade, can be overcome?

Senator PALTRIDGE:
LP

– The subject of overseas shipping freights is of particular concern to my colleague, the Minister for Trade, and I shall be pleased to forward the honorable senator’s question to him and obtain his comments. I think that freights from New Zealand to the Continent are cheaper than freights from Australia to the Continent. I speak only in a general sense. I have no doubt that the figures referred to by the honorable senator are correct, but I do not recall having seen them. The honorable senator has asked about the skill of the Australian negotiators who conduct periodic conferences with the members of the conference lines. I have no knowledge of those gentlemen, but I have no reason to doubt that they are selected for their skill and their knowledge of shipping problems. I am sure that they present the best possible case for Australian exporting interests.

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QUESTION

IRON ORE

Senator WARDLAW:
TASMANIA

– My question is directed to the Minister for National Development and relates to the subject of the question asked earlier by Senator Lillico. I preface my question by stating that Tasmania was greatly interested in and widely approved the recent statement by the Minister in relation to ,the export of iron ore from Australia. The Bureau of Mineral Resources has estimated Australia’s known reserves of iron ore at 368,000,000 tons, of which Tasmania has 200,000,000 tons of an average grade of 46 per cent, iron. Tasmania’s deposits are situated on the Savage River. After intensive drilling and investigations it may be found that the deposits are closer to 1.000,000,000 tons and their importance is increasing yearly. Will the Commonwealth Government investigate thoroughly the prospect of processing Tasmanian iron ore in Tasmania, at the same time giving full consideration to the State’s electric power resources and splendid limestone deposits? If such an investigation is favorable, will the Commonwealth approach large-scale industrial interests, which possess the necessary capital and1 technical knowledge, with a view to establishing a steel industry in Tasmania?

Senator SPOONER:
LP

– It is not easy to record all the facts about these iron ore deposits. Senator Wardlaw says that of the known reserves of 368,000,000 tons, a substantial proportion exists in Tasmania. Senator Wardlaw is under a misapprehension when he makes that statement. The quantity of 368,000,000 tons is the proved reserves that are at present being used or proposed to be used by the steel industry. If my recollection is correct, those proved reserves are in .South Australia, Yampi Sound and1 .Koolyanobbing. Those .three deposits yield ore of an average grade of 60 per cent. iron. The figure of 368,000*000 tons refers to the present known assessment of the extent of those deposits. The deposits have been measured only to a cer-ain degree. The total quantity available in the deposits still remains to be seen. When the deposits were last measured some twenty years ago the estimated quantity available was of the order of 50,000,000 tons less than to-day’s estimate, even though in the meantime we have used 100,000,000 tons. By and large, mining concerns do not incur the expense of measuring reserves beyond their requirements for some time to come. The 368,000,000 tons represents the deposits that are now being actually used or are likely to be used. The figure does not take into account the extent of other deposits at Constance Range, Roper River, Savage River and Scott River, all of which have not yet been property measured or established.

Regarding that part of the question relating to Tasmania, I can only say that the Commonwealth would be glad to assist Tasmania in any way possible to utilize its deposits to the best advantage. I sound this note .of warning, however: In respect of this deposit in Tasmania and most other deposits a good deal of work has yet to be done in order to establish the size of the deposits, the quality or” the .ore and its nature.

page 2126

QUESTION

STANDARDIZATION -OF RAIL GAUGES

Senator -BUTTFIELD. - My question is directed to the Minister representing the Minister for Shipping and1 Transport. It refers to rail standardization of the Peterborough division of the railway in South Australia, which includes the Broken Hill to Port Pirie section of line. Has any decision been reached concerning negotiations taking place between the Governments of South Australia and the Commonwealth on this matter? Is it a fact that current running expenses on the Port Pirie to Broken Hill section of the line could be reduced by approximately £10,000 a week if diesel electric locomotives, capable of conversion to standard gauge at a later stage or when necessary, were ordered1 now and put into service, the conversion to take place at the appropriate time? In view of .the concern in South

Australia at the apparent delay in this matter, will the Minister endeavour to obtain, before the Senate rises, information as to what can be done immediately and when the project may be completed?

Senator PALTRIDGE:
LP

– The latest development in this matter of which 1 am aware is that a conference recently took place between the Prime Minister and Sir Thomas Playford. I understand that to-day, in reply to a question that he was asked in the House of Representatives, the Prime Minister said that no decision had been made, but that the question would be examined by the Cabinet. The other part of the question related to the comparative economics of dieselization and steam. I think it is unquestionable that the use of diesel power is cheaper than steam locomotion.

page 2127

QUESTION

SEARCH FOR OIL

Senator WRIGHT:
TASMANIA

asked the Minister for National Development, upon notice -

  1. Is it a fact that the recent amendments to the Income Tax and Social Services Contribution Assessment Tax provide benefits in income tax assessment for moneys paid to finance companies for oil search although not applied to oil search in the relevant year?
  2. Has the Minister any information as to the extent to which the provision has been availed of?
Senator SPOONER:
LP

– I have made inquiries, and I now answer the honorable senator’s question in the following terms: -

  1. Amendments made last year in the income tax law in relation to moneys subscribed for oil exploration provide, inter alia, that deductions for moneys paid on shares be allowed when contributed to a company interposed between individual investors and an oil exploration company. One of the conditions is that the interposed company shall not have carried on any business other than -

    1. mining or prospecting operations for oil;
    2. the treatment of oil obtained from mining operations of the company in Australia or the Territory of Papua and New Guinea; and
    3. providing capital to oil exploration companies operating in Australia or Papua-New Guinea.

A further condition is that the companies concerned give appropriate undertakings and declarations to the effect that the moneys subscribed on the shares will be used for oil exploration. Before a deduction is allowed it is necessary for the Commissioner of Taxation to satisfy himself that the moneys have been, or will be, used for that purpose.

  1. Information concerning the amount allowed as deductions is not available to me. Public reports indicate, however, that, following the amendments to allow income tax deductions, considerable amounts of capital have been contributed to interposed companies and re-invested by them in companies actively engaged in oil exploration.

page 2127

QUESTION

TELEVISION

Senator BRANSON:
WESTERN AUSTRALIA

asked the Minister representing the Postmaster-General, upon notice -

Is the use of translator or repeater television equipment to be considered as constituting a second station under the Broadcasting and Television Act?

Senator SPOONER:
LP

– The PostmasterGeneral has furnished the following reply: -

In accordance with the definition in the Broadcasting and Television Act 1946-1960, any television station which transmits programmes intended for reception: by the general public is a station and would therefore require to be licensed.

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QUESTION

BANKING

Senator PALTRIDGE:
LP

– On 8th Novem ber, Senator Robertson asked me a question without notice relating to the recent acquisition of a site at Surfers Paradise by the Commonwealth Banking Corporation. I informed the honorable senator that I would bring her question to the notice of the Treasurer with a view to obtaining the desired information from the Commonwealth Banking Corporation. On 17th November, Senator Vincent also asked a question without notice on the same matter.

The Treasurer has now furnished me with the following advice which he has received from the Commonwealth Banking Corporation: -

The Commonwealth Trading Bank and the Commonwealth Savings Bank have a substantial branch in leased premises in Surfers Paradise. The lease expires in 1962. The recent purchase is intended to provide a permanent site for the corporation’s banks. Part of the site in excess of the corporation’s needs, together with some other land owned by the savings bank in Surfers Paradise, is to be sold and it is expected that ultimate establishment costs will be satisfactory having regard to the excellent location of the new site. It is the corporation’s aim to establish branches at the lowest practicable cost consistent with having a location and premises suitable to its customers’ needs.

page 2127

PUBLIC SERVICE BILL 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spooner) read a first time.

Second Reading

Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP

.- I move -

That the bill be now read a second time.

The main purpose of this bill is to amend the recruitment and appointment provisions of the Public Service Act following the Government’s consideration of the Report of the Committee of Inquiry into Public Service Recruitment. The development of a public service of the highest quality and integrity is a first essential of good government; and the quality of the Public Service itself is closely related to the standards established for recruitment. It follows therefore that it is prudent to keep standards of recruitment under review.

The recruitment provisions of the Public Service Act have remained substantially unaltered since the act was first passed in 1922. The Government readily agreed therefore with a recommendation of the Public Service Board that a committee of inquiry should be appointed to inquire into and report upon recruitment methods with the object of improving the quality of recruits. This committee consisted of Sir Richard Boyer, Chairman, Australian Broadcasting Commission; Professor Hytten, former Vice-Chancellor of the University of Tasmania; Dr. W. C. Radford, Director of the Australian Council for Educational Research; Mr. R. S. Parker, Reader in Public Administration, Australian National University; and Mr. F. J. Webb, Commissioner of the Commonwealth Conciliation and Arbitration Commission.

The terms of reference of the committee were -

To inquire into and report to the Prime Minister on the recruitment processes and standards of the Public Service and to make recommendations for any changes which, in the opinion of the Committee, are necessary to ensure that recruitment is soundly based to meet present and future needs and efficiency of the Public Service at ali levels.

I should say at the outset that the Government is indebted to the Boyer committee for its comprehensive and thorough review of the recruitment problem within the Public Service. The committee made a number of recommendations which were interesting, challenging and constructive, and the report is a valuable contribution to the current and future development of the Commonwealth administration. In many respects also it will be a continuing document of reference.

It is a general conclusion of the Boyer committee that the Public Service is not obtaining sufficient recruits of the right quality to meet its greatly expanded tasks and that the Service is too tightly closed against recruitment from outside to positions at intermediate and senior worklevels. In addition, the committee suggests that policies in respect of organization and staff development should ensure that the best use is made of talent available.

The recommendations of the committee, about 70 in all, have been examined most carefully. Many of them have been accepted by the Government, and of these, some are incorporated in the bill before the Senate and the remainder will be put into effect administratively. In other cases the Government endorses the objectives sought by the Boyer committee but prefers to achieve these objectives by means different from those suggested by the committee. In a few cases the Government was unable to accept the recommendations of the Boyer committee whilst in other cases - for example, the employment of married women - the implications of the recommendations are so far-reaching that much further study of them is required before a final decision is taken by the Government. I do not propose to develop a full analysis of the implications of all the recommendations of the Boyer committee in the course of this speech; but I shall say a few words about some of them.

There was a number of difficulties associated with the amendment of the existing provisions of the act in order to achieve the objectives of the committee’s report for clear and flexible recruitment machinery. It has been decided, therefore, to re-cast completely Division 4 of Part III. of the Public Service Act which deals with recruitment and appointment. There is, nevertheless, no departure in the new provisions from the broad principles on which the present legislation is founded.

Appointment to the Public Service will remain in the hands of the Public Service

Board as an independent authority and within the principle of open competition. The Boyer committee in endorsing this principle has recognized that a statement of it in legislation would need to be qualified by a number of important exceptions. The Government, therefore, proposes to continue to apply the principle of open competition without having it expressed formally in the act. The standards for appointment will be set by the board from time to time and notified in the “ Commonwealth Gazette “. The Public Service Board will retain authority to conduct its own examinations or to use the standards of education authorities and provision will be retained for promotion within the service so that the most junior officers will have the whole field of the Public Service open to them, provided they are able to meet the standards which are set for promotion within a division or advancement from one division to another. There will be a firm minimum standard for appointment to the Third Division of the service about which I shall speak presently. It is intended that there will be two general levels for recruitment to the Fourth Division. These will be at elementary and intermediate standard educational level. Within the Second, Third and Fourth Divisions of the service appointments will now be possible, not only to specific positions within a division, but also generally within a division.

The basic requirements for appointment to the Commonwealth Service under the existing act are that the applicant is a British subject, medically fit, and has made and subscribed an oath or affirmation. They are retained in the new legislation. Additionally, it is necessary to make it clear that the board may reject a candidate who, because of character, including police record, or for other good reason, is not considered to be suitable for admission to the Public Service. The board, in the past, has been working on the assumption that it has the ordinary rights of an employer to decide whether a candidate for appointment meets the standard of character and integrity which is clearly essential. But there is some doubt about this and therefore there is included in clause 11 of the bill - section 34 (c) of the new act - a provision to enable the board to be satisfied that a candidate for appointment is a fit and proper person to be an officer of the Commonwealth Service.

The Government has adopted the Boyer committee recommendation that the leaving certificate standard should be the firm minimum requirement for entry to the Third Division of the Public Service. This is a most important recommendation. Entry to the Third Division in this context include-* leaving certificate entry, appointment of ex-servicemen who were previously eligible for appointment at about Intermediate Certificate level, and also transfers from the Fourth to the Third Division, which is done by internal examination.

It would be difficult to bring down legislation owing to the need to take account of the variation in educational standards as between the States. Hence the Government feels that it would be preferable for the Public Service Board to give effect to this recommendation by administrative action. The legislation therefore leaves it to the board to determine the standards of entry, but it is the clear intention that an examination at the level and standard of the New South Wales leaving certificate will be the firm minimum standard for entry to the Third Division of the service, with equivalent examinations in other States - for example, the senior public in Queensland. This minimum standard will apply both on first appointment to the Third Division and on transfer from the Fourth to the Third Division, although the latter may need to be put into effect over a period.

The Boyer committee has made recommendations which are designed to facilitate recruitment of university graduates who have had work experience outside the Public Service as well as graduates fresh from the universities. The committee has also recognized the need for persons, whether they are graduates or not, with particular qualifications and experience to meet special needs both in individual positions and specialized employment categories. The Government supports these objectives and provision is made in the legislation to give effect to them. Entry at university graduate level will be freely used for recruitment of professional or technical officers, but the existing 10 per cent, limit will be retained for recruitment of graduates to other pose in the Second and Third Divisions of the service.

It is proposed to retain the provisions of the principal act which permit the Board to make appointments from outside the Commonwealth Service, subject to certain safeguards and to the established selection procedures. However, the new section 38, which re-enacts the old section 47, will be limited in the future of the appointment of persons of exceptional ability and experience. A new section 37 will be used for most of the appointments of persons with professional and specialist qualifications. Under both these sections the rights of officers will be protected.

The Boyer committee recommended that seniority as a criterion for promotion should be dropped entirely from the Public Service Act and Regulations. I would like to make it plain that we are on common ground with the committee that seniority should not be the sole, or even the principal, basis for promotion in administrative and senior clerical posts within the Commonwealth Public Service. The Public Service Act prescribes that the criterion for promotion in the Second and Third Divisions of the service is efficiency. It is only in a case of equality of merit that seniority is applied.

In examining this suggestion, the Government was impressed with the fact that the Boyer committee’s recommendations would1 extend not only to the Second and Third Divisions of the service, but also to the Fourth Division, which comprises approximately 66,000 officers, and which covers a great variety of employment including skilled, semi-skilled and. unskilled operations, typing staff, general office assistants, minor clerical workers, and so on. The application of a pure efficiency test throughout the Fourth Division would present very great, and perhaps insuperable, difficulties. The Government is not convinced that there is a need to depart from the existing provisions and procedures. In the Government’s view there must be a continuing quest for greater efficiency and the most efficient officers should be preferred for promotion. The bill provides, in clause 13, for an extension and a more flexible application of the principle that in considering officers for promotion to certain positions, regard is to be had to qualifications and aptitude to perform duties of higher positions.

There are two important recommendations of the Boyer committee on which the Government has not yet reached decisions. These are the employment of married women and the medical standards for entry of physically handicapped persons. The Public Service Act at present requires women members of the permanent service to retire on marriage. The Boyer committee has recommended the repeal of this provision and an interdepartmental committee is examining the implications of the proposal. I can assure honorable senators that the Government will consider the problem carefully as soon as this work is completed. I emphasize that we have not rejected1 that suggestion; we are investigating it.

As to the proposed relaxation of medical standards for the appointment of physically handicapped persons, it should be remembered that the Government and the Public Service Board are mindful of their responsibilities in the employment of the physically handicapped and a great deal is being done to provide employment in the Commonwealth Service for such people including those who are no longer physically fit to carry out their previous duties. While the problems of the physically handicapped merit and do receive the Government’s sympathetic consideration, there are difficult problems of definition as well as the need to maintain an overall standard of medical fitness in a career service. The Public Service Board has established a separate committee,, including medical authorities, to examine this question and the conclusions of this group will be considered by the Government.

The” committee has recommended that section 54 of the Public Service Act be amended so that the Public Service Board would be required to make a recommenda-tion to the Governor-General on all appointments as permanent head of a department, and so that if the Governor-General appoints a person other than the person recommended by the board, the reasons for the rejection of the board’s recommenda-tion should be reported to the Parliament. It has been the consistent practice of suc<cessive Prime Ministers to consult with the Chairman of the Public Service Board when appointments to positions of permanent head are required. This is a most desirable practice, and one which we hope will be continued by all future governments. The Government has not, however, thought it desirable to amend the present section of the act in the way recommended by the Boyer committee.

The Second Division of the Service includes officers who are required to exercise executive and professional functions in the more important positions. The Boyer committee recommends that the definition of this division should be amended to read “ administrative or executive functions and officers in training to exercise such functions “. The object of the recommendation is to improve the efficiency of the Service by a clearer definition of the “ administrative career “, which the committee believes can be achieved with the least dislocation by a modification of the Second Division. Basically, the Boyer committee seeks a distinction between those positions which have an important policy advising element and those which have not; and therefore positions of a purely managerial or professional character, containing no policy advising elements, would remain in the Third Division. The Second Division would include all positions with an important policyadvising element, together with intermediate positions that might form part of an administrative career, and below them a training grade with positions suitable for administrative training.

The Boyer committee was concerned that senior officers in the Service are too immersed in routine work and do not get “ time for thinking “ and in making its recommendation it had the very laudable objective of attracting and making the best use of officers with creative ability, and of encouraging self-improvement. The Government supports the objective of the Boyer committee. It feels, however, that the methods by which the Boyer committee sought to achieve this objective, namely the creation of an administrative civil service along the lines of the United Kingdom, would not he suitable in the present circumstances of the Australian civil service. The Government feels that the future requirements in staffing the Second Division of the Service can be achieved by more flexible recruitment provisions and the continuance of advanced training programmes, assistance to officers taking university courses, use of external training facilities such as the

Australian Administrative Staff College, use of the Australian universities and overseas institutions for advanced specialist study, and other methods. This is the present approach by the Public Service Board and it will be intensified from time to time as the demands of the Public Service increase. It will be clear to honorable members that the availability of an adequate number of people, trained and expert in functions of policy advising and policy administration, is so important that recruitment methods, including the composition of the Second and Third Divisions of the Service should be kept constantly under review and the Public Service Board has been asked to ensure that this is done.

Since the First World War, ex-servicemen have enjoyed the following concessions: -

  1. Preference in appointment over other candidates.
  2. Eligibility for appointment up to age 51 years.
  3. Lower medical standards where the medical condition results from war service.
  4. Reduced educational standards - in particular, the acceptance of a qualification of Intermediate examination standard for appointment to the Third Division.

In the view of the Boyer committee, the efficiency of the Service will be improved if minimum educational standards for appointment are fixed and applied evenly at the various levels of recruitment. The legislation provides therefore that ex-servicemen will continue to receive preference in appointment as against other candidates who are not ex-servicemen only where there is equality in qualifications. They will retain eligibility for appointment up to age 51 and receive the same concessions as to medical standards as exist at present. However, they will be required in other respects to qualify for appointment at the same standard and under the same conditions as other candidates. Clause 35 of the bill makes an exception in favour of ex-servicemen who have attained the minimum qualifications for appointment which have previously applied and who are applicants for appointment immediately before the date on which the new provisions of Division 4 of Part

Three come into operation. Such exservicemen will remain eligible for appointment by virtue of their existing qualifications.

Opportunity has been taken to include other amendments which have been found to be necessary for the effective administration of the Public Service. One such amendment gives the board authority to determine conditions of service for the increasingly complex section of the Public Service on duty overseas, where conditions vary from post to post.

I conclude my remarks by saying that in Australia we are fortunate to have a public service of great integrity, which is efficient and dedicated to its task of facilitating good government. It is certainly no reflection on the Service that the objective of the bill before the Senate is to provide machinery for attracting more good recruits to the Service. I pointed out at the beginning of my speech that the establishment of proper standards of recruitment to the Service is essential to the development of a public service of the highest quality and integrity and is a first essential of good government. I conclude on this note and I commend the bill to the Senate.

Debate (on motion by Senator Willesee) adjourned.

page 2132

STATES GRANTS (UNIVERSITIES) BILL 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Spooner) read a first time.

Second Reading

Senator SPOONER:
Vice-President of the Executive Council and Minister for National Development · New South Wales · LP

– I move -

That the bill be now read a second time.

Honorable senators will be aware that, following the acceptance of the recommendations of the Murray committee’s report on Australian universities, the Commonwealth established the Australian Universities Commission with the main functions of giving advice to the Government on the financial needs of Australian universities, and of influencing their balanced develop ment. The Government has received the commission’s first report which has already been tabled and this bill seeks to give effect to the commission’s recommendations for Commonwealth financial aid to assist the States with the development of their universities during the triennium 1961-63.

The Government considers the report of the commission to be a most valuable analysis of the problems which confront Australian universities. It is abundantly clear from the report that the Commonwealth and the States together will have to make large financial grants to universities to enable them to undertake the development that is necessary to overcome present deficiencies and to meet large expected increases in enrolments in the next few years. This bill in effect makes an offer to the States to assist them in their university development and this offer is by way of conditional grants. There is nothing in the bill which departs from the principle that the prime responsibility for university development in a State rests with the government of the State. The rights of the States are fully recognized.

I feel that I need spend little time in justifying the Government’s decision to give support to the States in this field because honorable senators are fully aware that there are present deficiencies in tertiary education in Australia, and that there are some greater demands ahead than have arisen in the past. To correct the situation, continued Commonwealth assistance is necessary. The bill which is now before the Senate and the report of the commission are inseparably linked, and in view of the importance of many of the points made in the report, I think that I should indicate some of the salient features of it before passing to the bill.

Chapter II of the report presents estimates of the likely increase in student enrolments at universities. Table 10 shows that the predictions of the Murray committee have already been shown to be considerable under-estimates. In 1958 some 41,770 students were enrolled at universities, and universities now predict that by 1966 the number will be of the order of 96,000. If this estimate is realized, the ratio of students enrolled at universities to total population will be approaching 1 in 100.

This is a dramatic and explosive development. Student performance also is discussed in chapter II., and after a review of the Commonwealth scholarship scheme the commission supports the need for an increase in the number of scholarships from 3,000 to 4,000 a year.

Chapter HI. of the report deals with academic staff. In spite of considerable staff recruitment in recent years, the number of students in relation to the number of staff is increasing and the position in Australia compares unfavourably with that in the United Kingdom.

The commission goes on to suggest that universities must be prepared to consider far reaching changes in the form of university education, and in teaching methods, in order to meet this problem. As to the availability of additional staff, the commission believes that Australian universities must rely in the main on their own resources for new staff in the next decade. The commission estimates that by 1966 the number of staff would need to be more than doubled to keep pace with the increased number of students. The commission comments that “ It is difficult to see the solution of this staffing problem if the present pattern of tertiary education persists “, but it points out that a similar problem exists in other countries. Chapter VI. deals with these problems in a more fundamental way.

Chapter IV. of the report presents the financial recommendations of the commission and its proposals for changes in the principles of the arrangements for Commonwealth assistance for universities and in the procedures for handling financial aid. I shall refer to these proposals a little later when I come to deal with the main provisions of the bill. Chapter V. deals with residential colleges and halls of residence and puts forward a summary of the commission’s views and recommendations relating to the coming triennium. These include financial recommendations which I shall refer to later.

Chapter VI. of the report presents the observations of the commission under the heading “ Present and Future “. The commission, after restating the magnitude of the problems, in effect asks whether the community as a whole and all the governments concerned are ready to face up to their implications. The commission also asks that the universities should study the problem and consider all possible changes in present patterns of teaching, in the provision of courses and in academic arrangements. These might include changes in university calendars.

In the view of the commission, the expenditures it recommends both for recurrent and capital purposes are essential both to overtake arrears and to cope with the rate of growth of the student population. The report discusses the future form of tertiary education. The commission believes that the problems of tertiary education must be solved within the universities and not in general at the secondary school level. The commission believes it hardly to be possible to continue creating new universities all patterned on 19th century models and hopes to be able to examine al) aspects of the problem during the triennium. It will probably be necessary to seek the assistance of an advisory committee on various aspects of the problem. The report puts forward a number of suggestions as to possibilities which should be examined.

The Government attaches the greatest importance to these comments by the commission. The Government considers the report of the commission to be a most valuable analysis of the problems of university development, which should provoke a great deal of thought and discussion on many questions which will concern governments, universities and the commission over the next few years. The Government shares the concern of the commission on some of the implications of the great increase which is taking place in university enrolments, and has, therefore, taken particular note of the views of the commission on the problems of the availability of staff and on the pattern of the development of tertiary education.

The Government regards the next twelve to eighteen months of the commission’s work on these matters as most vital. As a result mainly of demographic changes, obviously a quite explosive development is taking place in universities. The achievement in recent years has been a very remarkable one, but the changing age structure of our population and other factors have clearly meant that, in spite of greatly increased governmental assistance since the recommendations of the Murray committee were accepted, our universities have found it difficult to do much more than just to keep pace with the increasing number of students without being able to improve the standards of teaching, facilities and research.

We believe that the most serious thought therefore must be given to the desirable form of future development of tertiary education, and that within the universities new and unusual methods must be considered. The commission has mentioned in its report some of the forms of internal re-organization which might well be entertained by universities. We are sure that these, as well as the question of developing alternative institutions, must be vigorously pursued during this triennium; otherwise there will be a need for further increases in expenditure, possibly at levels which cannot readily be sustained.

The forms of re-organization which should be considered must, in our view, include possible re-arrangements in the university working year, re-arrangements to produce a greater use for the existing facilities and a greater use of staff, and the need to give greater attention to the standards of teaching staff. The building programmes of universities must be restrained as to cost and directly related to the most pressing needs. In these circumstances universities themselves should re-examine all their procedures in order to ensure that the funds to be provided are to be used as effectively and economically as possible.

This bill provides for Commonwealth assistance for both capital and recurrent expenditure by the States on a formula basis up to an agreed limit. On the capital side, the basis proposed is £1 for £1 and on the recurrent side £1 Commonwealth for £1.85 State. In addition, the Government accepts the commission’s recommendations to make available £500,000 on a £1 for £1 basis with the States for the purchase of special equipment, and the Government is willing to assist the development of residential colleges and halls of residence in the manner recommended by the commission. The Government also accepts the commission’s recommendation on the question of increasing the number of Commonwealth scholarships.

The development of the Australian National University, for which the Commonwealth has a direct responsibility, must be related in some degree to the development of Canberra as a whole, but the Government has accepted the commission’s proposals in principle. The Government recognizes the need for the provision of science facilities at the School of General Studies and has approved the erection of a new Chemistry School building

Turning now to the main provisions of the bill, honorable senators will note that grants will be made under four main headings: - Recurrent grants, capital grants and grants for equipment and residential colleges. In regard to recurrent grants, provision has been made for payments to new institutions, such as the Monash University in Victoria, in order to permit the appointment of staff for planning purposes. This is a departure from previous practice, as recurrent grants were previously made only to universities providing a teaching or research service. This provision should allow for forward planning and should expedite the development of new universities.

Clause 6 provides for the adjustment of the salary component in recurrent grants. The schedules of the bill are based on a professorial salary of £4,000 per annum, which was the salary that applied to a majority of Australian universities on the date the Universities Commission report was received. Sub-clause (2.) provides for machinery whereby the basis of the salary component may be changed.

For the purposes of recurrent grants, the bill provides for a continuation of the arrangements established by its predecessor, the States Grants (Universities) Act 1958, but on a slightly different basis. Honorable senators will recall that under the Murray committee arrangements for the years 1958-60, the Commonwealth made available unmatched grants known as “ emergency grants “. Under the arrangements proposed in the bill before the Senate, these emergency grants have in effect been absorbed into the general grant for recurrent purposes and new formulas have accordingly been devised. The bill introduces the principle that there should be uniform treatment as between universities and States. At the maximum the Commonwealth is prepared to match in the ratio of £1.85 State to £1 Commonwealth for all universities alike.

The first schedule, which is iri three parts for each of the years 1960-63, sets out the result in tabular form. In effect the recurrent grants work at two levels. The first level is shown by the figures in columns 2 and 3. The second column shows the minimum which a university must receive by way of State grants, fees and so on, before it can attract the first level of Commonwealth grant. Honorable senators will be interested to learn that universities are being asked to expend no more than they did in 1960 in order to attract this level of Commonwealth grant. The second level grants are shown in columns 4 and 5. The figures here represent the maximum additional contribution which the Commonwealth is prepared to make and show the additional amount which a university must receive, from other sources to qualify for this maximum grant. If a university receives funds somewhere between the minimum and the maximum shown, the Commonwealth will pay a proportionate sum.

On the capital side, the bill again provides for uniformity of treatment between States. The Commonwealth will match State expenditure on a £1 for £1 basis for building projects within universities as laid down in the second schedule, of the bill. The bill goes on to provide, in order to achieve flexibility, that the Universities Commission will be able to transfer funds available for one project to another project within the projects listed for each university, provided that the total amount available to each university does not exceed the total shown for that university.

Clause 8 of the bill departs in some respects from the provision of the earlier act. Based on the recommendations of the Universities Commission, the bill proposes that the Commonwealth Government make available £500,000 for the purchase of special equipment. The sum of £250,000 of this amount is to be disbursed to the States in the proportions shown in the third schedule. The remaining £250,000 will be made available to the States on the advice of the Universities Commission but not necessarily in the proportions shown for the first £250,000. In each case the ratio of ‘Commonwealth to State contributions is £1 for £1. It is hoped that this will give the commission the flexibility it seeks to meet more precisely the needs of individual universities within a State.

The fourth schedule to the bill sets out the basis upon which the Commonwealth is prepared to assist in the development of residential colleges and halls of residence at universities. It provides that approved building programmes may be assisted on a £1 for £1 basis and that grants for recurrent expenditure will be made available according to the student population of the college. This has been done so that the colleges may be encouraged to extend and develop their tutorial work among the students.

To sum up the scale and character of the expenditure that would be involved in the years immediately ahead, if there were to be no changes in the traditional pattern of tertiary education in Australia^ makes clear the vital need for the fullest examination of that pattern and for the adoption of new and unusual methods within universities. The Government has therefore welcomed the proposals of the Universities Commission for further inquiries into these matters and has informed the commission that it regards this as a matter of the most vital importance.

The bill that I am commending to the Senate takes its character from two main considerations. First, while it fully recognizes that the prime responsibility for the development of their universities rests with the States, the Commonwealth is prepared to support expenditures at levels recommended by the commission because it accepts that expenditure of this order is largely inescapable. Secondly, university development must go on apace. The needs are obvious. We are a nation with huge demands ahead of us for knowledge and competence in all fields, and we cannot afford to lag behind in making the best possible use of our intellectual and scientific resources.

Debate (on motion by Senator Tangney) adjourned.

page 2135

LOAN (QANTAS EMPIRE AIRWAYS LIMITED) BILL 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Paltridge) read a first time.

Second Reading

Senator PALTRIDGE:
‘Minister for Civil Aviation · Western Australia · LP

– 1 move -

Thai the bill be now read a second time.

The purpose of this bill is to seek parliamentary approval of a borrowing by the Commonwealth of 30,000,000 dollars - £13,300,000- in the United States on behalf of Qantas Empire Airways Limited. The bill provides for an appropriation of Loan Fund to enable the proceeds of the sorrowing, as they are drawn, to be made available to Qantas, lt also provides for an appropriation of Consolidated Revenue Fund to enable repayment of the loan and payment of interest and expenses by the Commonwealth. Arrangements will be made under which Qantas will pay the Commonwealth appropriate amounts before they are paid to the lenders.

It is important that this bill be approved by Parliament before the Christmas adjournment, because Qantas will need to be able to receive the first drawings by early January, 1961, when it has to meet heavy payments to its suppliers. However, it was only a few days ago that the terms of the extremely long and complex loan agreement entered into between the Commonwealth, the Export-Import Bank of Washington and the Boeing Airplane Company were finally settled. It was accordingly not possible to submit the bill, which when passed will approve the agreement, earlier in the present session. I shall shortly introduce a similar bill seeking approval for the borrowing by the Commonwealth of 2,000,000 dollars - £900,000- on behalf of the Australian National Airlines Commission. Although this bill could have been submitted to Parliament some time ago, its provisions are very similar to those contained in the Qantas bill, and it seemed appropriate that Parliament should be given an opportunity to consider the two measures at about the same time.

The proceeds of the Qantas borrowing will assist in financing the purchase of three new Boeing 707-138B aircraft and associated spares, and the conversion of the existing Qantas fleet of seven Boeing 707-138 aircraft into 707-1 38B’s. The turbo-fan engines, which will then be fitted to all Boeings operated by Qantas, will give the planes an increase in cruising speed of some 40 miles per hour, will cut fuel consumption by 10 per cent., will increase their pay-load, and will increase their take-off thrust from 13,500 lb. to 17,000 lb. The possession of these modern planes should be a major factor in strengthening the ability of Australia’s oversea airline to compete successfully on the world’s international air routes, and should further confirm the position of Qantas as one of the outstanding international operators.

As can be seen from the bill and the attached loan agreement, the Commonwealth is in the first place to borrow up to 30,000,000 dollars from the ExportImport Bank and the Boeing Airplane Company. Various other suppliers of the equipment will be associated with Boeing in the arrangements. The Export-Import Bank’s share of the 30,000,000 dollars to be borrowed will be 25,500,000 dollars, and Boeing’s share will be 4,500,000 dollars. The Commonwealth is required by clause 7 of the bill to make the proceeds of the borrowing available to Qantas. An agreement to give effect to this will be signed between the Commonwealth and Qantas as soon as this bill is approved by Parliament and the main loan agreement itself has been duly signed.

The loan agreement entered into with the Export-Import Bank and Boeing follows the pattern of agreements for other loans arranged by the Export-Import Bank. The bank normally requires that the borrower should contribute an amount of not less than 20 per cent, of the total programme in respect of which a loan is sought. The Export-Import Bank then provides up to 85 per cent, of the amount of the loan to finance the remainder of the cost, and looks to the supplier to provide the other 15 per cent. Thus, in this case, Qantas will be expected to provide an amount of not less than 7.500,000 dollars- £3,300,000- from its own resources. In fact, it appears that the total programme will cost about 39,000,000 dollars or £17,400,000, and Qantas will thus need to finance an expenditure from its own resources of some 9,000.000 dollars, or £4,000,000.

As the provisions of the loan agreement are somewhat unusual, and as this is the first occasion on which the Commonwealth has borrowed from the Export-Import Bank,

I will take this opportunity to explain briefly the provisions of the agreement. In general, it can be said that very little cash will actually change hands between the lenders and the Commonwealth. In the first place, there are already contracts with Boeing for the supply of the three new 707-138B aircraft to cost 15,100,000 dollars, and for the modification of the airframes of the seven existing Boeings at a cost of 6,000,000 dollars. Qantas has paid more than its 20 per cent, share of the amounts due on these contracts, which are referred to as “ pre-delivery payments “ in the loan agreement. Article Va provides that, as the remaining payments on these contracts fall due, they will be met jointly by the Export-Import Bank and Boeing, but will involve no cash payment to the Commonwealth. As I shall mention later, the amounts already paid by Qantas in excess of its 20 per cent, share are recoverable under Article V.

Another portion of the loan will be drawn by means of the letters of credit procedure established under Article VI. of the agreement. The letters of credit will be issued by a commercial bank with the approval of the Export-Import Bank in favour of the suppliers of the equipment. Thus, following payment by Qantas to the supplier of its 20 per cent, share of the contract price of the equipment, the Commonwealth will ask the Export-Import Bank to establish a letter of credit for 85 per cent, of the balance of the amount due to be paid to the supplier. When Boeing fs the supplier, paragraph A of Article VI. provides that, as Boeing draws down the letter of credit established by the ExportImport Bank, it is itself deemed to have been extending its 15 per cent, share of the credit.

Rather different arrangements apply when the supplier is the United Aircraft Corporation, which is to supply equipment and services amounting to approximately 9,400.000 dollars. This is because United is not involved, as Boeing is, in extending any credit to the Commonwealth under the loan agreement. The procedure for drawing on the loan for payments to United is that Qantas will again have to pay its 20 per cent, of the contract price, and that the Export-Import Bank will approve the issue of a letter of credit, this time in favour of United. Before then, as provided by Article VI., paragraph B, Boeing has to arrange to extend credit to United to cover Boeing’s 15 per cent, share of the loan.

The contracts with Boeing and United cover approximately 35,800,000 dollars of the estimated cost of the project of 38,900,000 dollars. The remaining 3,100,000 dollars will be paid to other suppliers. In this case Article V. provides that Qantas has first to pay the full amount of the contract price. The Commonwealth then claims a reimbursement from the Export-Import Bank of 80 per cent, of the amount, and the bank meets this claim after obtaining from Boeing its 15 per cent, share of the credit. In the event of a delay in the payment to the Commonwealth of those amounts, the advance procedure authorized by sub-clause (2.) of clause 7 of the bill may operate if required to enable the Treasurer to reimburse to Qantas the amounts which Qantas has already spent, pending the receipt of the funds from the Export-Import Bank.

The reimbursement procedure under Article V. will also apply to the “ predelivery payments “ already made by Qantas to Boeing in excess of its 20 per cent, share of the relevant contracts. As I have said, these contracts involve the purchase of three Boeing 707-1 38B’s and the conversion of the airframes of the seven existing Boeings. The claim for reimbursement will be made by the Commonwealth when the loan agreement has been approved and signed.

The only other feature of the loan agreement which differs to any degree from previous agreements entered into for the purchase of aircraft overseas for Qantas and Trans-Australia Airlines relates to the issue by the Commonwealth of a special form of promissory note. According to Article IV., the Commonwealth is to issue a note for the full amount of the borrowing - 30,000,000 dollars - before any borrowing is made. However, suitable protective provisions are included in Articles VIII. and X. of the agreement to ensure that the Commonwealth is finally required to repay only the actual sum borrowed, and to pay interest on this amount calculated from the dates on which each instalment is received.

The Export-Import Bank agreed in principle to the loan last June. Following signature of the agreement and compliance with the necessary conditions, the loan may be drawn as required, any time up to December, 1961, or such later date as is agreed to by the Export-Import Bank and Boeing. Repayments of the loan will commence in March, 1962, and will be made thereafter in semi-annual instalments, concluding in September, 1968. The first ten instalments will be 8.6 per cent. of the total borrowing, and the remaining four instalments will be 3.5 per cent. of the borrowing. Interest will be payable at the rate of 53/4 per cent. per annum on the amount of the loan from time to time outstanding.

As this is a borrowing that will come within the Commonwealth’s loan programme, Australian Loan Council approval was obtained to the terms and conditions of the loan at the June, 1960, meeting of the Loan Council, and the borrowing was included on the Commonwealth’s borrowing programme for 1960-61.

The general principle of this borrowing is very similar in nature to the earlier borrowings made by the Commonwealth on behalf of Qantas in November, 1956, and June, 1958. In each case the Commonwealth has acted as an intermediary between the lender and Qantas. As in the earlier loans, the Commonwealth will incur no net financial liability, but will give Qantas the benefit of its high credit standing overseas. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2138

LOAN (AUSTRALIAN NATIONAL AIRLINES COMMISSION) BILL 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Paltridge) read a first time.

Second Reading

Senator PALTRIDGE:
Minister for Civil Aviation · Western Aus tralia · LP

– I move -

That the bill be now read a second time.

This bill seeks the approval of the Parliament for the borrowing of 2,000,000 dollars - £890,000 Australian- by the Commonwealth in the United States of America on behalf of the Australian National Airlines Commission. The bill provides for an appropriation of the Loan Fund to enable the proceeds of the borrowing to be paid to the Australian National Airlines Commission. It also provides for an appropriation of Consolidated Revenue Fund to enable the Commonwealth to meet payments of principal and interest and of other charges associated with the loan. Similar amounts will be paid into Consolidated Revenue Fund by the Australian National Airlines Commission before the Commonwealth makes its payments to the lender.

The arrangements for the borrowing to which the bill will give approval are similar to those approved by the Parliament in 1958. Then the Commonwealth borrowed 3,000,000 dollars- £1,300,000- on behalf of the Airlines Commission for the purchase of the first Electra aircraft put into service by Trans-Australia Airlines. This time, the loan is from the Chase Manhattan Bank of New York, which arranged the 13,000,000 dollars loan for Qantas in 1958. As in the 1958 loan for the Airlines Commission, the Commonwealth will make the entire proceeds of the borrowing available to the commission on terms similar to those provided in the agreement entered into by the Commonwealth with the lender, which is annexed to the bill as the schedule.

Trans-Australia Airlines now operates three Electras. The first was financed by a loan from a group of New York banks, and received parliamentary approval under the Loan (Australian National Airlines Commission) Act 1958. The second was purchased by Qantas with the assistance of finance provided under the Loan (Qantas Empire Airways Limited) Act 1958 and was subsequently sold by Qantas to TransAustralia Airlines under the authority of the Airlines Equipment Act 1958. The proceeds of the present borrowing will provide part of the purchase price of the third Electra aircraft, together with related spare parts and equipment. The remainder of the purchase price has been provided by Trans-Australia Airlines from its own resources.

Negotiations for the loan were completed in New York in April, 1960. Following these negotiations, a loan agreement was drawn up and was signed by the Australian Consul-General in New York on 24th August.

Under the agreement the principal amount of 2,000,000 dollars- £890,000- is repayable in twenty equal quarterly instalments between March, 1961 and December, 1965. Interest is payable at 53/4 per cent. per annum on the amount outstanding from time to time. A commitment fee of one-half per cent. was payable on the full amount of the loan until it was drawn on 24th August. After that date, interest became payable at the full rate of 53/4 per cent.

The terms on which this loan was negotiated are comparable with the terms of aircraft loans negotiated in the United States at about the same time. Other provisions in the agreement are similar to those appearing in earlier agreements negotiated by the Commonwealth in the United States for borrowings to purchase aircraft for Qantas and T.A.A.

Under the authority of clause 5 of the bill, it is proposed that the proceeds of the borrowing will be made available to the Airlines Commission on terms similar to those of the original borrowing as laid down in the loan agreement. The airlines Commission will consequently be responsible for payment to the Commonwealth of such amounts as it requires to meet its obligations under the loan agreement in respect of interest, principal and other expenses.

The borrowing of the amount of 2,000,000 dollars is part of the Commonwealth’s loan programme for 1960-61 and was approved by the Australian. Loan Council at its meeting in June last. Thus, before the loan agreement was signed, Loan Council approval had been obtained in accordance with the provisions of the Financial Agreement to the terms and conditions of the borrowing.

The Commonwealth is acting only as an intermediary in this loan, which will therefore involve no net call on the Commonwealth’s cash reserves. By acting as the borrower the Commonwealth has, however, made use of its own high credit standing overseas to obtain terms more favorable than the commission would have been able to secure had it arranged the borrowing directly. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2139

BILLS RELATING TO SALES TAX

Motion (by Senator Paltridge) put -

That the second reading of the Sales Tax (Exemptions and Classifications) Bill (No. 2) 1960 and of the Sales Tax Bill (Nos. 1 to 9) 1960 be made orders of the day for a later hour of the day. (The President - Senator the Hon. Sir Alister McMullin.)

Ayes . . . . . . 31

Noes . . . . . . 27

Majority . . 4

Question so resolved in the affirmative

page 2139

SALES TAX (EXEMPTIONS AND CLASSIFICATIONS) BILL (No. 2)1960

Second Reading

Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP

I move -

That the bill be now read a secondtime.

The Government believes that the issues raised by this bill and in the Sales Tax Bills (Nos. 1 to 9) 1960 are of an importance that warrants their reconsideration by the Senate. As has been stated on a number of occasions during the prior consideration of the measures, the sales tax proposal comprises only a part of a much broader plan to be implemented1 by the Government. The defeat of these measures could unbalance the entire plan. It is not my intention to re-state the case at this stage, as all honorable senators will be familiar with the Government’s views. It is hoped that the Senate will on this occasion reverse the decisions it took when the measures were last considered.

Senator WRIGHT:
Tasmania

.- I did not expect that we would not hear a speech by an Opposition senator. The Government is taking the course of representing the bills which were defeated in (his chamber on Monday night. I want to say, Mr. President, that nothing has come to my understanding to alter my opinion of the measures. I cannot accept the claim, either, that the motor car industry should be controlled or that a sales tax of 40 per cent, on motor cars is appropriate as an economic measure to arrest inflation or to correct the trend of overseas balances. The tax represents nearly £300 on a Holden car. I am convinced that, continued for an indefinite period as the 30 per cent, sales tax of 1956 was, the present impost would be inflationary. It adds artificially to the cost of cars, both business and private. As a temporary measure, it may dampen down the trade, but the cost will be quite disproportionate to the economic benefit as I see it. The measure will do nothing to reduce the recurring significant cause of inflation in this country, which stems from our unique system of national wage fixation by a body which must be re-organized or re-constituted if wage adjustments are to have a real value and ensure responsibility. In 1959 alone that system poured into the financial stream £200,000,000. In conjunction with unreal increases in national wages, commodity taxation on this high scale, in my view, aggravates inflation and increases prices. I can only hope that this contention will now be thoroughly examined and the position remedied. But I need not repeat my views, which were more fully stated in that respect on Thursday last.

The Senate has rejected these measures, but the Government, with the support of the House of Representatives, insists on this bill. It is a bill for the imposition of taxation and, although it is submitted as an economic control and not for revenue purposes, it is a money measure of a description which, under the Constitution, the Senate may not amend. I ask myself then: What is the Senate’s proper course? This House is a house of review and, I hope, will survive as such, notwithstanding difficulties from party affiliations. I belong to a party whose policy is to preserve this Senate as an independent, responsible house of review, but, as such, its authority should be pressed to the point of compelling a government to drop a major measure or to go for election only for every special reasons - for example, an important measure in relation to gold in Western Australia, sugar in Queensland, fruit or aluminium in Tasmania, or, departing from the States’ rights point of view, a measure to maintain a fundamental principle such as the preservation of life insurance companies from control and compulsory loans to governments.

This sales tax measure belongs to a class in which, in my view, the Government, supported by the House of Representatives, is entitled to dominate. The Government, with the House of Representatives supporting it, has indicated that the Senate’s point of view does not persuade it. Therefore, I think, the proper course is that the Senate should yield. It has registered in a parliamentary way its disapproval of the measure. This is not a case in which undue delay would be proper. The industry should know Parliament’s decision. There has been a decent interval for reconsideration.

My outlook is that a deliberative vote in the Senate demands a great sense of selfdiscipline and an objective interpretation of the constitutional relations between the two Houses. The Senate is not a rubber stamp but, on the other hand, it is not a forum for irresponsible obstruction to legislation of an elected government. One must always be conscious of preserving a proper sense of the relationship of our authority to that of the House of Representatives.

I therefore feel that as the Government, with the support of the House of Representatives, is pressing its claim to have this measure passed, it is proper to withdraw my vote from the division. I may say, Mr. President, that in my view it is a case - recalling the statement of a great House of Commons man - of letting the Constitution work. I record my opinion that it was proper, on the first occasion, to vote against the measure as an expression of Senate opinion on a national policy of importance; but now, in view of the insistence of the Government, with the support of the House of Representatives, it is proper no longer to continue that opposition.

Senator KENNELLY:
Victoria

.- Mr. President, we have listened to a lot of nice words that have degraded this institution more than have any others in the years that I have been here - about eight or nine - and have degraded the parliamentary system as we understand it in the British Commonwealth of Nations. I should marvel, yet I do not. I do not marvel because 1 know what certain people are made of. Thank God I know where I am going, on what side I am, what I believe in, and what I will do when I want to vote. If ever, in this or any other place, I do what I have seen done to-day, I shall be delighted that my father and mother have passed on and did not witness a son of theirs showing such a degrading twist of thought.

Senator McCallum:

– You are just being silly.

Senator KENNELLY:

– I might be silly, but if you come into this I will belt hard on other matters.

Senator McCallum:

– I am not frightened of you.

Senator KENNELLY:

– Mr. President, we have witnessed something extraordinary coming from one honorable senator to-day. I have attempted to learn why the prefix “ honorable “ is attached. I want to know what it means. Does it mean, as it does to those of us who are without the advantage of a university education, that a man is expected to honour his word and is expected to do what he believes is right and in the interests of his country? If the word does not mean that, Mr. President, let us hope that at some more appropriate time I can have a chat with you and that you will tell me what it does mean. I shall refer later to the speech that was made here a few days ago.

Senator McCallum:

– You will break your halo if you keep on much longer, you know.

Senator KENNELLY:

– It will be all right as long as I do not break the bottle. I said that if you came into this, I would be tough.

Senator Hannaford:

– What about your action in regard to the Communist Party Dissolution Bill?

Senator KENNELLY:

– All that I say to you is that I marvel at what happened. Senator Wright’s exhibition to-day, with well chosen words, no doubt will salve his conscience. Thank God that it is his, not mine.

Senator Wright:

– And thank God that it is mine, not yours.

Senator KENNELLY:

– This valiant honorable senator claims to be the defender of all that is right. To-day, in a meek and crawling manner, with a mass of words, he informed the people that he will not repeat to-day the vote which he gave only two days ago. Yet we wonder why there are people in this country who believe that this system of parliamentary government is out of date and archaic!

Senator McCallum:

– But you are trying-

Senator KENNELLY:

– My friend, you can go outside because you enjoy yourself outside much better than you do here in the chamber. I am amazed that one who made a speech, portions of which I will read, could get up to-day and utter the words that he uttered.

Mr. President, we have often witnessed Senator Wright take the Napoleonic stance. The only way in which he differs from the man who was placed on St. Helena is that he does not pull his hair across his forehead. But, as I said in the Senate some months ago, or a year ago, he comes here as the Liberace of the Senate with all his acting. However, it takes more than acting to answer for his change of front. I would not for one moment imply that there is anything wrong in his manner. I discount the rumours that I have heard around the corridors. I do not believe them, but they certainly are not nice. While perhaps an honorable gentleman may have missed an appointment in one State some time ago, I often wonder what the future holds.

As I informed the Senate, I intend to quote at length from the speech which he made on this bill. What did he expect the Government to do? Did he expect it to run away. 1 am certain that the Leader of the Government in the Senate (Senator Spooner) does not run away very much, and I respect him for that.

Senator Spooner:

– But when he gets beaten he does not cry like you are crying now.

Senator KENNELLY:

– I do not know whether I am crying, if you wish me to state the plain fact, because I did not think at any time that this measure would not be passed. I knew we would win the other night, but I know the pressures that can be exerted and you know how to apply them. I do not think that when the Labour Party has 26 senators and the Democratic Labour Party has two senators one can hope in his wildest dreams to win on an issue such as this.

The honorable senator has said, through a shower of crocodile tears, that this increased tax is wrong and that it will not do what it is expected to do; but because the House of Representatives has passed the bill and the Government wants it, there is a change in him and a volte face on his part. Would any one in the political life of this country, or any other in which this system of government operates, expect that the Prime Minister (Mr. Menzies), when he has a majority of sixteen in the House of Representatives, would want to submit a bill and have it defeated? Elementary! Certainly not! After all the crocodile tears that we have seen and all the evidence of strength that we have witnessed during the months that the Senate has been in session, one wonders, Mr. President, just what the future holds for this system of government when a person, who has more than ordinary intelligence, who has had the good fortune to have the highest education in his own State, who has made his mark at the Bar and who has become what might be called a legal luminary in his own State, is so craven here! I am amazed to think that one could ever dream that a thing such as this could really happen.

Senator Spooner made a remark about crying. I expected it, my friend, but not from you, because although we may disagree I have always admired your toughness. I have no quarrel with it. This is not a game of pinball or kiss-in-the-ring. But this is not the first time that Senator Wright has made his valiant speeches and when the pressure has been applied he has intimated, as he has done now, that he will not vote on the bill. He has done so before in this chamber. Everyone who has been here in recent years knows that to be true. AH I can say, Mr. President - and I do not refer to any individual - is that I have a dog at home and I am very proud of it. I admit that the dog has relegated me to No. 4 position in the home, but if I give him a clip over the ear he looks at me and stands up because he is a good dog. If he was a cur or a mongrel, what would he do? He would run away. I am delighted to know that 1 have a good dog and I shall treat him as such. I respect my dog. When, at times, one could class a person, by his manner, as having the face of a lion but the heart of a frightened deer, one wonders just how much he really has!

Let me deal now with Senator Wright’s speech made on 1st December.. As reported on pages 1946 and 1947 of “ Hansard “, he said that these bills increase the rate of sales tax on motor cars and station wagons from 30 per cent, to 40 per cent. He went on to say -

Our economy depends to a great degree on our export trade to finance the importation of raw materials, which are the sinews of our development. The Government has limited constitutional powers and it is a notorious fact that the federal form of government shows essential signs of weakness.

The latter statement is true, but that is the fault of the government of the day. For three years this Government permitted a committee, representative of both Houses of the Parliament, to study the Constitution. The committee then submitted a report. If I remember correctly, the Government received the report of the committee in 1958, but, as it has done with a lot of other reports, it has left that report alone. Senator Wright played a very important part on that committee, and it is most interesting to read some of the things he said in his minority report. As appears at 183, he stated -

It is probably a long overdue reform to enact that a member of Parliament who agrees to pawn his vote to any outside organization, Caucus or Party, commits an offence and becomes disqualified.

Senator Wright:

– Hear, hear!

Senator KENNELLY:

– I am delighted that he is adhering to that. He would not deny that he has departed from that principle, having regard to the fact that the word “ party “ is used. Then, as appears at page 185, he referred to that great British statesman, Sir Winston Churchill, and quoted the following remark by him -

In the fiercest clash of debate we have jealously guarded the right of every Member freely to speak for his constituents and for himself.

Then he went on further. These are not Sir Winston’s words, they are Senator Wright’s words -

It is the abuses in its party management which should be corrected.

What I want to say to Senator Wright is this: What he wrote in his minority report-

Senator Wright:

– He is evidencing to-day.

Senator KENNELLY:

– It is not evidenced in his statement to-day. Every one knows the rumours that have been circulating around the corridors. I admit that it needed great courage to do what was done the other night, but I would have thought that if he were courageous on 1st December, he would not have lost that courage by 6th December. But what happened shows how easy it is to be a bad judge. Senator Wright went on to say–

Senator Sir Neil O’sullivan:

– I rise to order. The matter before the Senate is the motion for the second reading of a bill. Senator Wright is not the subject of the bill. I suggest that Senator Kennelly should confine his remarks to the bill.

The PRESIDENT:

– ‘What is the point of order?

Senator Sir Neil O’sullivan:

– I submit that the honorable senator is not confining his remarks to the bill that is before the Senate.

The PRESIDENT:

– The point of order is not upheld.

Senator KENNELLY:

– I wish now to refer to Senator Wright’s speech in the

Senate on 1st December last, when the Sales Tax (Exemptions and Classifications) Bill (No. 2) was being debated. I shall read from his speech. He said -

When one sees the extent by which prices exceed internal costs of production and transportation one becomes aware that the prosperity of our export industries is reaching a dangerous level. That is chiefly caused by the ravenous demand made on the export industries by internal costs in Australia.

That was one of the reasons that prompted Senator Wright to take courage and vote as he did on 1st December. Then he said -

The only other point I want to make by way of preliminary explanation of the view I am compelled to take is this: We are now considering this matter in 1960. We have just passed through the decade of the ‘fifties which, from the viewpoint of negotiating our way through our external trading, and having regard to increasing costs, has been easy. But every year during which the current state of affairs continues will intensify the competition that we shall meet abroad. In my view, the easy assumptions that have been entertained in relation to the ‘fifties would be misleading if applied to the development of our economy in the ‘sixties. I believe that that places a special responsibility upon one.

I am prepared to accept my responsibility as an individual member of the Parliament. That responsibility bears a relationship to the fact that the Senate has authority constitutionally in respect of bills such as the one we are now debating. The Senate has the authority, and therefore the duty, to review proposals of the kind we are now considering and, if necessary, to reject them.

He went on further -

In what way is it suggested that this proposal to increase the sales tax on cars and station wagons will correct our external reserves position or stem the inflation of costs within Australia?

Seemingly, it does not matter now whether this tax will increase costs, as it must do, or whether it will have a great detrimental influence on the economy of this nation. Because the House of Representatives passed the bill, and because the Government demands that the bill be passed here, he does not propose now to do as he did on 1st December. He then referred to a discussion that had taken place between Senator McKenna and Senator Spooner regarding the contribution that the motor industry made to exports and he said -

I found that exchange of views interesting, because I have often rallied to the call which has gone forth on my side of politics -

I wonder Whether he has any side at any time; - - and which has suggested that the only way in which to extricate yourself from an inflationary condition is to produce your way out of it.

He went on to say that the increase that is envisaged in the bill would not be added to the price of export cars. But he sought to prove that the increase, spread over the whole ambit of the industry, must have an effect on the cost of cars that are exported. After stating what the export of cars meant to this country and directing attention to the increased volume of our export of cars, Senator Wright said -

So I remain unconvinced, Mr. President, that the proposal to increase sales tax on cars and other vehicles sold in Australia will have a substantial effect upon our external reserves position. I remain completely unconvinced by the argument that an increase in the sales tax on this essential commodity - used, as we have been reminded, by every family in Australia - will have any effect in reducing inflation in this country.

The honorable senator said that when the sales tax on cars was increased from 16$ per cent, to 30 per cent, in May, 1956, it was supposed to be a temporary measure. It has been so temporary that I am reminded of the temporary employees in the clerical division of the Public Service.

Then Senator Wright indicated what this increase in sales tax would mean to the price of a Holden motor car. He also spoke about steel, and argued that this impost would in no way affect our overseas balances. He added -

Therefore the suggestion that this will be a temporary tax is one that does not justify confidence, in my view.

He pleaded with the Government to place a time limit on the operation of this increase. We all know what would happen to the Australian motor industry if a time limit of six months or nine months were applied. We know that only those persons who were absolutely compelled to buy a motor car would dream of buying one within that period. But that suggestion was contained in the speech delivered by the honorable senator on 1st December. He finished his speech with these words -

  1. . I regret that I cannot convince myself that this proposal is at all appropriate either to stem inflation internally or to correct the situation regarding the external balances, and I oppose the measure.

To-day, Senator Wright said he still opposed the measure. But there is only one way in politics in which to oppose a measure, and that is to vote against it. Never has any one witnessed such a change of attitude towards such an important decision. Senator Wright has put forward a wordy and no doubt well-prepared case, for which I give him credit. But it was lacking in an essential ingredient. To-day the people of this country need men who know what they want, and who have the courage to back up their attitude by their votes and so help this industry. Has it not been said during this debate, and is it not right, that there are other ways in which the present situation could have been remedied without affecting the motor industry?

The Government was told in February, when it lifted import restrictions, what would happen. It knew that luxury goods would be allowed into Australia, that our external balances would drop, and that the economy would be affected. But the Government would rather have luxury goods imported. That being so, it has increased the rate of sales tax on cars by 10 per cent., bringing it up to 40 per cent. Forty per cent., mark you! That must have an effect on the motor industry. Every one knows about the colossal cost of transport in Australia. Any one who runs away with the idea that the cars and station wagons to which this impost is applied are used solely for luxury driving does not know the realities of life outside the Parliament. I know that this impost does not affect trucks, but private cars are used in all phases of industry. Therefore, an increase of sales tax must further raise transport costs. I understand that in Australia transport costs account for 33 per cent, of the cost of commodities. In the United States the figure is 19 per cent., and in Great Britain it is 18 per cent. I remind the Senate that this Government came into office some eleven years ago to put value back into the £1.

I regret what has happened. It degrades this institution. To uphold the prestige of this institution means more to me than the winning or losing of a vote. In world affairs, one thing should be uppermost in our minds - to maintain the respect of this institution so that we may show to other people to the north of us, and not so far away, that we run our affairs according to a system under which men are prepared to state their views and to support those views by their votes. I greatly regret what has happened. I never dreamt I would ever see a situation in which a person as gifted as

Senator Wright, with a brain superior to that of the ordinary man, and lucky enough to have had an education that has been denied to thousands of people, including many people on both sides of this chamber, would do what he has done. Because the whip is cracked and because there is no courage to withstand the onslaught of the whip, he crumbles.

Senator Paltridge:

– There is no lack of courage.

Senator KENNELLY:

– The Minister for Civil Aviation, who is in charge of the bill, interjects. How different is his attitude to-day from that of a few days ago, when he replied to the second-reading debate!

Senator Paltridge:

– You could never accuse him of lack of courage.

Senator KENNELLY:

– I am sorry that I have not with me a report of the speech the Minister made on that occasion. It would make interesting reading. Every one knows what his attitude was then. I did not think his reply to the debate was a good one, because it was rubbing salt into the wounds. However, it helped me, and I smiled on it with great pleasure. But to-day, of course, the honorable senator will be on the Minister’s side - or outside the doors, which means the same thing. If the Minister derives any comfort from that fact, I am willing to let him have it. If Senator Wright belonged to my party - I speak with some knowledge of its ramifications - he would only do this kind of thing once. I say to him, “ Thank God you are not a member of this party “.

Senator Wright:

– I claim that the speech to which we have just listened has misrepresented me, and I ask for leave to make a personal explanation.

Leave granted.

Senator Wright:

– The speech we have heard1 asserted that there were rumours in the corridors which certainly were not nice, and it went on to refer to certain other appointments. Unreservedly, unequivocally and emphatically, I assert that I have not heard any such rumours. If they exist, they are completely baseless.

Senator Spooner:

– I have not heard any such rumours either. I do not believe-

The PRESIDENT:

– Order!

Senator Wright:

– I wish to say that if there is any shred of honour in the man from whom that dirt emanated, he will either move for an inquiry by the Committee of Privileges before the Parliament rises, or withdraw and apologize. His speech went on to refer, from the knowledge and experience that he has imbibed during a tortuous life in public affairs, to the use of pressure. I deny that any pressure whatever has been applied to me by way of discussion, persuasion, threat or otherwise. I have made my decision on my own judgment of the constitutional proprieties. When an announcement is made by the Prime Minister that the Government, with the support of the House of Representatives, intends to claim that a bill should be passed by the Senate, the Senate has its responsibilities.

The PRESIDENT:

– Order!

Senator Wright:

– I am making an explanation, not a speech, Sir. I deny that my decision stems from any pressure. I wish to say, in response to the man who has referred to his dog - we have only his word that it is not a cur or a mongrel - that his electors would bc better represented by the dog than by its owner.

Senator McMANUS:
Victoria

.- The two members of the Australian Democratic Labour Party in the Parliament will vote against the measure. Our reasons for doing so were expressed by Senator Cole during the previous debate in the Senate and I do not propose to go into them now, other than to say that in our view a tax of 30 per cent, is vicious and that an increase to 40 per cent, cannot be justified. We believe that under this measure rich people and business organizations will still be able to obtain motor cars. Business undertakings will simply pass on the increased cost in the form of increased prices. The result will be that the farmer, who must have a new car regularly because of the roads over which he is obliged to travel, and the family man, will suffer. Therefore, we oppose the measure.

I wish to say something about a point that has been raised, not only in this chamber, but also in public discussions and in the press. I refer to the suggestion that there is involved in this matter a constitutional principle of great weight. It has been said that it is the prerogative of the lower House to have its will in relation to a money bill. I have no objection to that view being expressed by the members of the other side of the Parliament who have done so. 1 merely regret that the conversion to that principle of the parties which they support has been so belated. I come from Victoria, Mr. President. In 1947, the upper House of the Victorian Parliament, in defiance of the principle which has been so strongly enunciated recently, refused supply to the lower House and turned the Cain Labour Government out of office. Most of the members of the Liberal Party in this chamber were in politics at that time, yet I did not hear one word of criticism of that decision. On the contrary, they applauded it vociferously, and they reaped the political benefits of it two years later.

I was intimately associated with certain negotiations with the case of the Australian Country Party in 1950, as a result of which we used the upper House to put a Liberal government out of office. To my knowledge, no member of the Country Party in Victoria objected to that decision. On those occasions when the upper House thwarted the will of the lower House to the extent of putting governments out of office, there was unanimous applause, in one instance from the Liberal Party and in the other instance from the Country Party. As Mr. Calwell, the Leader of the Australian Labour Party in another place, has expressed views to the effect that the lower House should prevail, I merely mention that he offered no opposition on at least one of the occasions to which I have just referred.

Senator Vincent:

– But the Government ls not arguing that in this House.

Senator McMANUS:

– The Government has argued that most effectively in another place, and it has also argued it most effectively in the channels available to it through the Australian press.

Why should members of the Senate be criticized because they believe that the Constitution should be operated as it is rather than as some people say that it ought to be? I suggest to those who hold: the opposite view that governments have had countless opportunities to alter the constitutional position of the Senate: had they wished to do so. Apparently, they have not been prepared to do that. Let us not be hypocritical. The view that the lower House should prevail is always strongly asserted by governments which have the numbers in the lower House and do not have them in the upper House. When the positions are reversed they will just as strongly assert the right of the upper House to thwart the will of the majority in the lower House. I object to all this talk about noble constitutional principles. Let us admit that the game of politics has been played for years, and that it has been played once again. My party will continue to exercise such little power as it has in the Senate through my vote and that of my colleague. What alternative have we?

We are told that the House of Representatives is the truly representative body of the people. I deny that. I claim that this Senate, by its constitution, is infinitely more representative of the people than is the other place. Almost 10 per cent, of Australians vote for the Australian Democratic Labour Party, yet that party has no representation in the lower House. Therefore 10 per cent, of the Australian people are without representation in a House which we are told truly represents democracy in this country. If the electoral system to which all honorable senators are wedded denies us representation in the lower House, what alternative have we but to express our point of view through our votes in this Senate. I condemn the attack that has been made in this matter on the rights of the Senate. I hope that honorable senators will continue to stand for whatever rights are given to them under the Constitution. Those who object to such a situation have the remedy in their own hands. They may ask the people to alter the Constitution in any way that they think fit. The attitude of the Democratic Labour Party to this measure has not changed. We think it is wrong and we will vote against it.

Senator WOOD:
Queensland

.~ On the last occasion that this bill was before the Senate I spoke and recorded’ my vote against the bill. Since then a lot of water has flowed under the bridge. There has been a great deal of discussion and representation about this matter. As a parliamentarian T am amazed at the attitude of certain people, some of them representing this nation here and’ in another place, because one does not vote in accordance with their wishes. I came into this Senate as a member of the Liberal Party of Australia. I believe- that the party’s platform and policy give one freedom to express oneself and to vote according to one’s conscience. I am surprised how petty some people in> this chamber and in another place can become. Since, the vote was taken on this measure a few days ago I have, frequently been passed by colleagues, not only, from this chamber, but also from another place. Not all of those persons were back-benchers. Some of them were Ministers. Their attitude is contrary to a liberal outlook. Their conduct is certainly not such as wins friends and influences people. However, it is probably in keeping with the Government’s policy of endeavouring to win friends with the bill that is now before the Senate. The attitude adopted by certain of my colleagues does not worry me. Such people are very petty indeed.

When I spoke on this bill previously 1 said that I would record my vote according to my conscience. The Minister for Civil Aviation (Senator Paltridge) in reply said that I was not the only person with a conscience. When I made my statement I did not say that I was the only person with a conscience. It my colleagues do not vote on this bill as- T do, I will not castigate them. Everybody has a right to vote according to his conviction. 1 recognize that as a member of a party I have certain responsibilities, but I have always believed that the party to which I belong allows its followers certain freedoms. One thing in which 1 believe is that my party does notdirect, me. I recall that- in Queensland not very long ago my party and the Country Party came into power because of a split within the Labour government which was then in office. The Labour Premier and his Cabinet, with the exception of- one person, objected to dictation by their party. It would be a very sorry day if the Liberal Party should decide to direct honorable senators- and honorable members how they should vote. That would not be democratic.

When I spoke on this bill previously 1 gave reasons why I was opposed to it. Certainly representations have since been made to me. Some of my colleagues have spoken to me. I appreciate their actions. It is something of an ordeal to talk to a person in the circumstances in which I find myself on a matter like this, and 1 appreciate my colleagues coming to me. I assure them that every consideration was given to their representations. However, certain ideas are deeply entrenched in my mind. One of them is that the people generally should get a fair deal. Although the Government’s desire to increase sales tax on motors cars may be part of its overall plan to improve the state of the economy, I think that this bill does not give a fair deal to the motoring public.

If we as political parties tell the people certain things and later, by our actions, show that we were not telling the truth, we do not do ourselves justice. We tend to undermine the respect of the people towards the Parliament and political parties. In. 1956, when the Government of which I am a supporter increased the sales tax on motor cars to 30 per cent., it said that the increase was a temporary measure. To-day, that tax is recognized by the Government as a. revenue tax. The Government is now seeking to increase the rate of sales tax by 33i per cent., raising it to 40 per cent., and again it is called a temporary tax. The Government’s action is distasteful to me. I think it will undermine any trust that the people may have placed in the Government’s statement that the 30 per cent, tax levied in 1956 was of a. temporary nature. How do we know that the new rate of 40 per cent, will not. be permanent and will not be considered as a revenue tax? How do we know that at some later stage the Government will not seek to increase the rate to 50 per cent.?

Senator Henty:

– As- happened in the United Kingdom.

Senator WOOD:

– Just because something is- done in the United Kingdom it is no reason why we should do it here. Possibly many things are done in the United Kingdom that should be done here. I do not see any need to compare our position with that of the United Kingdom. Following the last war the United Kingdom was faced with difficulties about which we in Australia knew absolutely nothing. Possibly the effects of the war are still’ being felt in the United Kingdom. It is utterly ridiculous to compare conditions in the United Kingdom with conditions in Australia. For instance, Australia’s war debt bears no comparison to the war debt of the United Kingdom, particularly taking into account relative values of things and relative incomes of people in the two countries. In making those statements, I make it quite clear, again, that to me this is a vicious tax and one which is sectional in its application. I cannot see why the motoring public have been selected for this impost. Look at the other avenues that are open to the Government! Why do all the other products of this country escape the impost? Why is it always the motorist who has to pay more? Even after buying his motor car he does not escape special attention from a taxation point of view; on every gallon of petrol that he uses in the vehicle he pays lid. - I think that is the amount - to Commonwealth revenues.

Senator Mattner:

– He gets mighty good roads in return.

Senator WOOD:

– My friend, Senator Mattner, says that the motorist gets mighty good roads in return for that payment. Let me remind the Senate that when Queensland was deprived of £1,600,000 for roads under the new agreement, I fought-

The PRESIDENT:

– Order! That matter has no relationship to this bill.

Senator WOOD:

– I bow to your ruling, Mr. President. The point I am making is that we should have better roads in view of the amount that the petrol tax contributes to revenue. In Queensland where the roads are not good because of the shortage of available funds there are more impositions on the motorist than probably many people in the south realize.

I want to make it quite clear that I believe that the motorist is saddled with very heavy burdens. Although the state of prosperity of this country may be such as to enable people to buy cars and to pay this additional sales tax on them, I think that the question of fair dealing is in the minds of the people and it should be in the mind of this Government. It seems to me that the motoring public have not sufficiently stood up for their rights, with the result that the Government considers that an easy way to collect more revenue is by increasing the sales tax on motor cars.

Let us look at the basic reasons for the proposed increase of sales tax. One is to reduce the demand for cars in Australia. Another is to reduce inflation in this country. Still another reason is to reduce our imports. But the fact cannot be ignored that the increase of tax will produce more revenue for the Government

In the Budget that was recently considered by this chamber, the Government estimated that this financial year would close with a surplus. I should like to know what the Government proposes to do with the additional revenue that this increase of sales tax will produce. No statement on that aspect of the matter has yet been made by the Government. When the Estimates and Budget Papers are presented in this chamber, each year, we know what revenue the Government expects to receive and its estimate of expenditure. But in this instance, no indication has been given of what the Government intends to do with the additional sales tax that will be received if this measure becomes law. It would be some compensation to the motorist if the money were applied to the development of the road system. How do we know that the additional money collected by this tax will not be placed in a fund from which the motorists of this country will derive no benefit? Is the money to be paid into the Consolidated Revenue Fund, or will it be used to redeem Commonwealth loans? We should be told of the purpose to which it will be applied.

Mr. President, as I mentioned the other night, I think there are better ways - more effective ways - of overcoming the present economic situation than by increasing the sales tax on motor cars. As I said on that occasion, I think it would have been preferable for the Government to confer with the hire-purchase people and endeavour to get them to increase the amount of deposit required and to shorten the term of repayment. I believe that if that had been done the Government would have achieved its objective. Only to-day, I read in one of the newspapers a report of a statement that was made yesterday by Mr. Bisset. who is the chairman of the Australian Hire Purchase Conference. It reads, in part, as follows: -

Mr. Bisset said that if the Federal Government had consulted h.-p. companies before introducing credit curbs, they would have recommended an immediate increase in statutory deposits on all credit buying. This measure, he said, would have reduced credit without the distasteful elements of the recently imposed curbs.

Looking at this matter from a political point of view, one can see that, if that had been done, the hire-purchase people would1 have taken the responsibility, whereas now the Government, by imposing this increased sales tax, is attracting a great deal of odium to itself. The chairman of the Australian Hire Purchase Conference has stated exactly what I suggested in my speech the other night.

This tax is out of line with my thinking. Senator Wright has made his statement. I always pay a tribute to him because he is one of the great minds in this Senate. He is a man of courage and I believe that he stands on his Liberal principles probably more strongly than do lots of us in this chamber. I have very great admiration for him. The fact that he has withdrawn his vote on this occasion, I am quite sure, has given him cause for a lot of thought. I think he made a statement that is in accord with what is set out in the report of the Constitutional Review Committee. The approach to this bill is a matter for one’s own conscience. I do not reflect on anybody’s opinion, whether or not it accords with my opinion.

There is an aspect of this matter apart from the national question. Last Saturday or Sunday in Brisbane I noticed a statement that was made by the Premier of Queensland, the Honorable Frank Nicklin, in which he said that he intends to raise at the next Premiers’ Conference - or the next meeting of the Australian Loan Council - in Canberra the incidence of the credit restrictions that have been introduced because of their adverse effect on my own State of Queensland1, particularly at the present time, which is a period of low employment.

Reference has been made to the rights of this Senate, lt is a States House and it has certain powers. One of the things that amazes me is that whenever the Senate exercises any power there is always a threat to reduce the powers of the chamber. I am not a great legal man; I am no great constitutionalist; I am just a simple public man. But I do believe that it should not be said that the Senate cannot use a power simply because that power has not been used for some years. If the power exists, it can be used. As Senator McManus has said, the members of this chamber are elected on a very democratic franchise. The people of each State elect ten senators. It is possible that because of the basis of our election we have a wider view than others in regard to the States and1 the Commonwealth as a whole. Despite what has been said, I make no apology for standing up and saying that I believe that this Senate has certain rights. I deplore the fact that certain members of this chamber have said that its powers should be reduced. I think that is an entirely wrong attitude. Every honorable senator should be out to preserve the rights of the Senate. Reference has been made to altering the manner in which the Senate is elected. Let me say to the Senate that whatever changes take place in this chamber rest with the votes of senators. On occasions like this when there is a dispute between the two Houses in relation to bills, I have no hesitation in saying that the Senate should use its power to make a decision.

Sitting suspended from 5.45 to 8 p.m.

Senator WOOD:

– Before the suspension of this sitting I expressed some of my views on the measure. I said that I thought the proposed increase was very steep, and that the tax was sectional and a burden on the motoring public. I traversed the position of the Senate, pointing out that whenever the Senate used its power we were told that that power would have to be curbed. I pointed out that the power which belonged to the Senate was there to be exercised and the fact that it had not been exercised for some time was no reason why it should not be exercised now. It is said that because this House is elected under the proportional representation system, the system should be altered and the power of the Senate restricted. Irrespective of the things that are said, I believe that there is no reason why the Senate should not exercise any power that is given to it. When it does exercise its power, there should be no suggestion of taking that power away.

I recall that during the period of office of the Scullin Government, the majority of senators were of my political faith. If I remember rightly, at that time the Senate gave quite a considerable amount of worry to the Scullin Government. The Senate of that day obstructed, delayed or amended legislation much more frequently than is the case when the majorities in each chamber are of the same political faith. If we accept these circumstances when they are in our favour, we should be big enough to accept them when they are the other way. When there is a split in the Government parties and some senators move from one side to the other, that also ought to be accepted. When it was originally reported that two senators who were Government supporters would oppose the bill, it was said that those two senators should not overrule what had been decided by the House of Representatives. It should be recognized that we are elected by the people under the federal system on the same franchise as that on which members of the other place are elected. It should also be recognized that we have a responsibility to the electors, just as have members of another place. I believe that we have a duty to perform here and that we should perform it with a clear conscience.

Senator Sir Neil O’sullivan:

– Leave conscience out.

Senator WOOD:

– I am sorry that that should be sard by Senator O’sullivan. I am not casting reflections on anybody else. This chamber has certain powers and rights. It should be clear in the minds of the people that this was not a case of two senators deciding an issue. This was a case of a majority in this chamber deciding an issue according to parliamentary practice. The learned senator who interjected will agree that when a vote is taken here, no recognition is accorded to the political parties to which the senators belong. That is something that should be kept clearly in mind.

I do not desire to occupy very much more time. When I spoke before the suspension, I mentioned that the Premier of Queensland had referred to the adverse effect that credit restrictions could have in Queensland. Unemployment there has risen as a result of the ending of the sugar cane crushing season, and the closure of meat works and other seasonal industries. These measures have struck Queensland at a very bad time. The proposed increase in sales tax could lead to further unemployment.

Senator Scott:

– What about our over-full employment?

Senator WOOD:

– Senator Scott, who comes from Western Australia, talks about over-full employment, which he says exists at the present time. It might be correct in relation to certain parts of Australia and on the overall picture, but it is not correct in relation to areas on the Queensland coast.

Senator McManus:

– It is not correct in relation to Western Australia.

Senator WOOD:

– I leave that to Senator Scott; he should know. It is very easy to talk about over-full employment and vacant jobs. Nobody wants to be shifted from one State to another because there is not enough employment in his own State and there is over-full employment elsewhere. If things are tough in one area, we should not bring in legislation, having in mind only certain areas of the Commonwealth, when other areas may be adversely affected by the legislation and their, situation made more difficult.

I have in mind many very fine types of men who have lived for years with their wives and families in their own homes in the same community in Queensland. They have a particular interest in the community in which they live. This proposed increase in sales tax is so severe that many of those men will be put out of work because sales of motor vehicles will be reduced. This means that they will have to leave the towns in which they live. That is a very bad outlook for them. Already, in many sugar-producing communities hundreds of people are unemployed. Further little pockets of unemployment will be created throughout the States. Increased unemployment has a psychological effect, and a sense of depression takes hold of the areas. As a consequence there is a tightening of spending, and unemployment increases further. As I said a few nights ago, I am concerned with the human aspect. If this measure affects my State in the manner which I have suggested, it will not be to anybody’s advantage. Last week I had1 a letter from a motor dealer at Southport.

Senator Sir Neil O’sullivan:

– Only one?

Senator WOOD:

– I am sorry that the honorable senator should interject in that. vein. I do not know that there is anything wrong in specifying one instance. I have had a number of letters in regard to the situation, and I am citing this one in particular from Southport. It was from a dealer holding a franchise for very popular motor cars and trucks. He said that formerly he had about 36 employees. Whereas he would normally sell seventeen or eighteen vehicles in a fortnight, in the two weeks following the imposition of the increased sales tax, he sold one. As a result he had to dismiss five employees, lt is all very well for people to laugh. Those five employees are human beings who have a right to be happy and to work, just like anybody else. Each has a heart that ticks and a mind that thinks and he is entitled to as much enjoyment and happiness from life as anybody else. The dealer stated that if the position did not improve he would1 have to dismiss more employees.

Just before I entered the chamber this afternoon, I had a telephone call from a lady living on the south coast of New South Wales. She told me that as a result of the increased sales tax her son’s business had almost collapsed. Her husband is the president of the local branch of the Liberal Party and her son is the president of the Young Liberals. People like that do not talk lightly about matters such as this. She had gone to the trouble of making a trunk line call about the matter. Coming down from Queensland last Sunday by air, I spoke to a man in the motor industry. He is the head of a very big concern which has several other companies attached to it. He told me that these organizations employ many hundreds of people and that in his view this measure could create quite a considerable amount of unemployment. To me, that is a matter of deep, human concern, although I hear arguments about the rights of the Senate and all the rest of it. My view is that we are here to represent the people of the Commonwealth, and as senators we are representatives of particular States. I believe that the Government’s proposal is bad and dangerous and it could act to the detriment of many people in the State I represent, at any rate.

Those are my views, Mr. President. Summarizing them, I believe that the proposed tax is far too steep. It is an imposition on what is said to be a temporary tax.

This bill increases it to 40 per cent., which is far too steep. Such taxes should have a wider range, if the Government wants to achieve its purpose by way of taxation. As I mentioned before, I believe that in co-operation with the hire-purchase companies by the introduction of a higher deposit and a shorter term for repayments the Government could have achieved its purpose just as quickly and more effectively than by the proposed method.

Senator Sir Neil O’sullivan:

– Are you speaking as a matter of opinion or conscience?

Senator WOOD:

– As far as the people of the State I represent are concerned, I do not think this is a matter of opinion or conscience. What really concerns them is whether it is right or wrong; whether it is just or unjust; whether it is fair to the particular section of the community on which the tax is proposed to be levied; and whether it will be beneficial to them in the long run.

This bill has been very contentious and there has been a lot of tension in both Houses in the last two or three weeks. We know that statements have continually been made about the way people intend to vote. The recording of a vote on this matter requires very deep thought and deliberation, and when one casts his vote he does so after giving it due consideration. I have had many deliberations and many talks and I will cast my vote after having given very due consideration to those deliberations. When I cast my vote I will do so in that spirit, because I believe it is best for the people generally. The making of this decision is fraught with many possibilities. I know that there are many men who do not like one taking a certain stand, but I feel that there are times when one must take a stand on a matter even if in the long run it may mean a great loss or sacrifice to the person making the decision. Standing here in the Senate, I say that irrespective of what the consequences may be, I shall vote against the bill.

Senator PALTRIDGE:
Minister for Civil Aviation · Western Australia · LP

– in reply - At the outset, I want to refer to the speech made this afternoon by Senator Kennelly - not, I say at once, because it had any particular relevance to the subjectmatter we are discussing, but because it contained one or two statements which in certain events could have consequences which Senator Kennelly himself did not foresee when he made them. I shall quote two passages from his speech.

Referring to Senator Wright, he said -

But, as I said in the Senate some months ago, or a year ago, he comes here as the Liberace of the Senate with all his acting. However, it takes more than acting to answer for his change of front. I would not for one moment imply that there is anything wrong in his manner. I discount the rumours that I have heard around the corridors. 1 do not believe them, but they certainly are not nice. While perhaps an honorable gentleman may have missed an appointment in one State some time ago, I often wonder what the future holds.

At a later stage, Senator Kennelly said -

What I want to say to Senator Wright in this: What he wrote in his minority report … is not evidenced in his statement to-day. Every one knows the rumours that have been circulating around the corridors. I admit that it needed great courage to do what was done the other night, but I would have thought that if he were courageous on 1st December, he would not have lost that courage by 6th December. But what happened shows how easy it is to be a bad judge.

First, I want to say that I for one have heard no rumour whatsoever going around this Parliament.

Senator Sandford:

– You were not listening; that is why.

Senator PALTRIDGE:

– You may have, and you may have the opportunity to say something about it. Secondly there is not a scintilla of proof of any suggestion - however vague, however devious, however remote, or however wicked - that Senator Wright, in voting on this bill as he votes, whether it be on 1st December or 5th December, is so voting because of some arrangement that exists. I say, as the Minister responsible for this measure, taking the first opportunity to put on record, that any suggestion of a rumour of a deal, if I may so describe it, is completely groundless, utterly false and utterly untrue.

Senator Kennelly also said something today about an interjection which I made in respect of an allegation that Senator Wright showed some lack of courage, which I refuted. That Senator Wright and I should differ in this chamber has long since lost its novelty, but never at any time have I said in this chamber that one of the deficiencies I found in Senator Wright or his arguments was a lack of courage. T want to put that on record.

I wish to refer to one or two statements made by Senator Wright himself. He returned to a theme with which we are all now quite familiar, a theme which he expresses very firmly and which takes the form that most, if not every one, of our economic ills flows from the increases in wages which have been granted by the arbitration commission in recent years. I say to Senator Wright that the Conciliation and Arbitration Commission is a tribunal which is part of the system by which wage rates in Australia are fixed. I do not suppose that it is possible that on all occasions every one would agree with a finding of a wage-fixing tribunal, but the fact is that this is the accepted method of wage fixation in this country.

Having said that, I say equally emphatically that the Government does not fail to recognize the dangers that accrue from constant wage rises.

Senator O’Byrne:

– What about profit rises?

Senator PALTRIDGE:

– You will have the opportunity, at a later hour to-night or to-morrow, to talk about that because legislation which will have the effect to which you are referring will be before the Senate. It will be very interesting to hear what you have to say about that legislation.

We accept the fact that high wages not only are a symptom of inflation, but do in fact add to inflation itself. We know that over a period of years wages have increased far more than costs have increased in this country. We view that, not with displeasure, but with pleasure, because it indicates a rise in real standards. But we say that if those standards are to be maintained, and if any real increase in standards is to be effected, costs of exports and costs generally must be kept low. I say that to Senator Wright to indicate to him just how the Government feels in connexion with this matter, and I refer him particularly to the action of the Government earlier this year, when it took an unprecedented step in relation to the Commonwealth Arbitration Commission.

Senator Wright said that this tax should not be allowed to live any longer than was absolutely necessary. I do not know why he said that, because on Monday evening I referred him to statements made both by myself and by the Treasurer which indicated the approach of the Government to this tax. Those statements set out in specific terms that the Government held itself responsible to keep the matter under review with a view to removing the tax at the first opportunity. I say further that the economic situation of this country is under continual review. It is under day by day review at the Treasury, and as a matter of course Cabinet looks at developments regularly. It will be looking at the economic situation of the country in the autumn, it will be looking at it some two or three months later, and then it will be looking at it again, of course, during the preparation of the budget. It will take whatever action is needed.

Senator Sheehan:

– There is no harm in looking at it.

Senator PALTRIDGE:

– No one can suggest, even by way of the idle interjection which has come from Senator Sheehan, that the Government has at any time failed to take action when action has been necessaryregardless of whether the action was popular or unpopular.

I want to say a word or two about the comments made by Senator Wood. He returned to his old saw. He said that this was a discriminatory tax and that the Government was picking out one section of the community. It has been said in this debate time and time again - without being contested, much less disproved - that this industry is being selected for a particular reason. It is not because the Government has a hate against this industry, nor is it because there is something wicked about this industry. It is because this industry is imposing strains on the economy which are not good for the economy and is affecting other sections of industry. In his desire to be just to one section of industry, Senator Wood is content to sit back and see discriminatory action taken against other sections of industry, which are suffering as a result of the very robustness of the motor car industry.

Senator Wood:

– We encouraged those people to build those factories.

Senator PALTRIDGE:

– Senator Wood may deny what I am saying, but although he has declared his attitude he has not dis proved the facts that have been put before this chamber in respect of this matter. In addressing his mind to this important question Senator Wood has carefully avoided considering this particular aspect of the matter. Does he deny that there is a pressure of employment in this industry far in excess of the general pressure of employment outside of it?

On Monday night I quoted figures which showed that employment in the motor car industry, with all its ancillaries, has increased at the rate of 9 per cent., as against an increase of 4 per cent, in the general range of industry. Figures that have since come to hand indicate that in the motor assembly branch of the industry the increase in employment has been 22 per cent., as against an increase of 4 per cent, in the general range of industry. Does Senator Wood deny that this imposes a strain on overseas funds or that it makes a claim on hire-purchase money which is badly needed elsewhere - money which could possibly be put to better use in providing employment in his own State of Queensland, were it not being used to purchase motor cars?

Senator Wood:

– The Government was skiting about this position at Budget time.

Senator PALTRIDGE:

– I am merely stating the facts and asking Senator Wood to disprove them. He has not even addressed his mind to this aspect of the matter. I said something last night about imports. Further figures that have come to hand show a remarkable picture. For the first four months of 1959-60 the value of the imports of complete vehicles amounted to £3,300,000, and for the first four months of this year the value of complete vehicles imported amounted to £5,700,000 - an increase of 73 per cent. In the case of vehicle components, the increase for the first four months of this year over the first four months of last year is 49 per cent. In the case of rubber it is 23 per cent., and in the case of oil 11 per cent., making a total overall increase of 36 per cent.

I do not wish to strain the credulity of Senator Wood, but he may be interested to see what has been published in the newspapers for all the world to see. I refer to advertisements for employees in one or two motor car establishments. I have here an advertisement from the Melbourne “ Herald “ of 28th October, 1960. It was inserted by the Ford Motor Company and calls for -

Applicant .possessing experience in fault-finding and repair of modern hydraulic controlled machine tools.

The advertisement contains the following paragraph: -

Pius payment plan adds IS per cent to ordinary rates for full attendance.

Does not Senator Wood think that that is excessive? Does he not think that that is imposing a strain on the labour market?

I have also an advertisement inserted by Volkswagen (Australasia) Proprietary Limited. It appeared in the Melbourne “ Herald “ of 21st November. The date is significant because it was after the statement made by the Treasurer. That company, when advertising for employees, said that a job with Volkswagen offered aboveaward payments plus overtime and other incentives such as a car purchase plan. As Senator Wood was speaking, I was wondering how those poor industries in Queensland about which he was talking and which so badly needed succour would fare against such firms.

Senator Wood:

– There is a surplus of labour up there. I guarantee that.

Senator PALTRIDGE:

– Senator Wood said that the increase of 1956 was a temporary tax and that it had never been taken off. I wonder whether the honorable senator has ever asked himself during the period from 1956 to 1960 when it should have been taken off. Would he, as an effective administrator, have removed or reduced the tax at any time between 1956 and 1960? I hear no answer.

Senator Wood:

– I would not have made a permanent tax of what was to be a temporary tax.

Senator PALTRIDGE:

– I can add little to what has been said during the course of this debate. The Senate has had adequate opportunity to discuss the matter in all its aspects. I conclude as I concluded the other night and say this: The fact that this tax rs unpopular in some limited circles is no judgment of the intrinsic merit of the proposal. In Australia to-day, we are all so highly organized that we can raise a complaint against the Government at the drop of a hat, if it suits our will to do so.

This tax, I suggest - I do so quite clearly - has not caused a public clamour at all. There has been a clamour from a restricted number of people in the industry; that is all. The majority of people in Australia, knowing, and being able to establish by comparison, the situation in the motor car industry, accept this increase as being necessary at this point of time. The Government, having reviewed the situation and having had a long look at the general state of the economy and the state of this particular industry, has declared that at this point of time and for the purpose I have indicated this tax should be imposed.

Question put -

That the bill be now read a second time.

The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)

AYES: 29

NOES: 27

Majority . . 2

AYES

NOES

Question so resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

SALES TAX BILLS (Nos. 1 to 9) 1960.

Second Reading

Motion (by Senator Paltridge) put -

That the bills be now read a second time.

The Senate divided. (The President - Senator the Hon. Sir Alister McMullin.)

AYES: 29

NOES: 27

Majority . . 2

AYES

NOES

Question so resolved in the affirmative.

Bills read a second time, and passed through their remaining stages without requests or debate.

page 2155

CRIMES BILL 1960

In committee: Consideration resumed from 6th December (vide page 2122).

Clause 24.

Clause 24. (Proposed section 24ab.) (Opposition amendment No. 20.) “24ab. - (1.) In this section - act of sabotage ‘ means . . . (2.) A person who -

carries out an act of sabotage; or

has in his possession any article that is capable of use, and which he intends for use, in carrying out an act of sabotage, shall be guilty of an indictable offence.

Penalty: Imprisonment for fifteen years. “ (3.) On a prosecution under this section it is not necessary to show that the accused person was guilty of a particular act tending to show a purpose intended to be prejudicial to the safety or defence of the Commonwealth and, notwithstanding that such an act is not proved against him, he may be convicted if, from the circumstances of the case, from his conduct or from his known character as proved, it appears that his purpose was a purpose intended to be prejudicial to the safety or defence of the Commonwealth. “ (4.) On a prosecution under this section, evidence is not admissible by virtue of the last preceding sub-section if the Magistrate exercising jurisdiction with respect to the examination and commitment for trial of the defendant, or the Judge presiding at the trial, as the case may be, is of the opinion that that evidence -

would not tend to show that the purpose of the defendant was a purpose intended to be prejudiced to the safety or defence of the Commonwealth; or

would, having regard to all the circumstances of the case and notwithstanding the next succeeding subsection, prejudice the fair trial of the defendant. “ (5.) If evidence referred to in thelast preceding sub-section is admitted at the trial, the Judge shall direct the jury that the evidence may be taken into account by the jury only on the question whether the purpose of the defendant was a purpose intended to be prejudicial to the safety or defence of the Commonwealth and must be disregarded by the jury in relation to any other question.

Upon which Senator McKenna had moved by way of amendment - (Opposition amendment No. 20.) Leave out sub-sections (3.), (4.) and (5.) of proposed section

24AB.

Clause 52 (Proposed sections 78 and 79.) (Opposition amendments Nos. 30 and 35.)

” 79.-

” (7.) On a prosecution under sub-section (2.) of this section it is not necessary to show that the accused person was guilty of a particular act tending to show a purpose intended to be prejudicial to the safety or defence of the Commonwealth or a part of the Queen’s dominions and, notwithstanding that such an act is not proved against him, he may be convicted if, from the circumstances of the case, from his conduct or from his known character as proved, it appears that his purpose was a purpose intended to be prejudicial to the safety or defence of the Commonwealth or a part of the Queen’s dominions. “ (8.) On a prosecution under this section, evidence is not admissible by virtue of the last preceding sub-section if the Magistrate exercising jurisdiction with respect to the examination and commitment for trial of the defendant, or the Judge presiding at the trial, as the case may be, is of the opinion that that evidence, if admitted -

The CHAIRMAN (Senator the Hon. A. D. Reid). - There being no objection, that course will be adopted.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition Amendment No. 30.) Leave out sub-sections (2.), (3.) and (4.) of proposed section 78. (Opposition Amendment No. 35.) Leave out sub-sections (7.), (8.) and (9.) of proposed section 79.

Last night I opened the discussion on amendment No. 20, which relates to the evidentiary provisions which in effect say that in relation to espionage there are three elements. The first element is the doing of a particular act of sabotage. The second element is that the sabotage must relate to one of four classes of goods. The third element is that there must be an intent to be disloyal or an intent to harm the safety and defence of the Commonwealth. The evidentiary provision that we are now considering is directed solely to proof of intent - not to the act or class of goods, but to the third ingredient. It enables the Crown, without proving any particular act evidencing the intent, to prove the intent, amongst other things, from the circumstances of the case, the conduct of the accused and the known character of the accused as proved. As an Opposition we are not concerned about the first two items - proving the intent from the circumstances of the case and from the conduct of the accused - because under the ordinary law, both those matters being strictly relevant to the offence charged, they would be admissible for consideration in any event. But the known character of the accused introduces a new element that cuts right across the principle that the accused’s bad character is not to be brought into issue unless it is raised by his own action.

I adverted to the sanctity of that principle and I propose to refer again to the case that I mentioned previously in the debate but of which I did not have an opportunity to give particulars. That is the case of Attwood v. Regina, which was decided in March of this year by a High Court bench comprising five judges. The bench was presided over by the Chief Justice. One judgment was delivered conveying the opinions of the five judges. In their judgment they advert to the important principle for which the Opposition contends. The judgment reads -

Bad character may be regarded as the contrary of good character, but as a separate and independent fact or matter it may be proved on a criminal trial only in answer to evidence adduced of the accused’s good character. It is not excluded as irrelevant to the proof of guilt. It is excluded as a matter of policy - policy deeply rooted in principle.

The judges quote from an 1865 case heard before Mr. Justice Willes and say -

The evidence is relevant to the issue but is excluded for reasons of policy and humanity. . . .

May I repeat that to the committee. The judges say that the evidence as to bad character is excluded for reasons of policy and humanity.

Senator Vincent:

– With one very important exception.

Senator McKENNA:

– Let me conclude the quotation, which reads - . . because although by admitting it you might do justice in one case out of one hundred, you would probably do injustice in the other ninetynine.

That was a case decided as recently as last March by five judges of the High Court, who affirmed the principle for which the Opposition contends. That was a murder trial. It took place in Victoria and it establishes the fact that although the State statute law of Victoria prevents an accused person from being cross-examined as to his bad character, it does not prevent evidence that is relevant to the commission of the act being given even if it puts the accused or his character in a bad light. So, as long as the circumstances and the behaviour are relevant to the act with which he is charged, the fact that some element of bad character comes out does not affect the position.

Senator Vincent:

– I do not want to interrupt unnecessarily, but would you not say that the High Court held that evidence of bad character, if relevant, was admissible in those circumstances?

Senator McKENNA:

– The Bench plainly said that. It said that the evidence was admissible if relevant to the act with which the accused is charged. The difficulty with the provision in this legislation is that it obviously goes much further. There would be no need to place it in the act at all because the common law principle is the one applied by all courts. “ Known character of the accused as proved “ is a term that does not appear in anything but this statute in the Commonwealth law. It appeared in one section relating to espionage. The Government now proposes to apply it to the new offence of sabotage as well as the offence of breach of official secrets. The provision is being expanded to enable the Crown to prove guilty intent with ease.

The evidence that may be given as to known character of the accused as proved could range back over his entire life. It is in effect hearsay evidence. It is the known character as proved.

One’s character may change quite substantially. The mind of man and his outlook are probably the most flexible things in nature. You have classic instances of sinners who became saints and vice versa. I need only point to Paul of Tarsus, the persecutor of the Saviour on earth, who later became one of His most ardent disciples. But amongst some of the apostles, Paul was never able to live down some of his earlier activities. There are men who are prominent in the Communist Party who found the error of their ways and are now playing prominent parts in the world. Even in Australia itself one finds that. But the initial taint sticks. The known character, once known, adheres. One of the unfortunate traits of human nature is that people prefer to believe the worst of their fellows. They seize upon scandal with avidity and they by-pass the virtues of a person. That is unfortunately a common human characteristic.

There are dangers inherent in that. It is bad enough in a matter of sabotage. I hope that time will permit me to run through the three offences that apply to things of the sort. I think that the Prime Minister (Mr. Menzies) started to give an instance in his speech in the other place recently, but he did not finish it. He talked about a man dropping a spanner into an important machine and wrecking its operation. That is the act, and the second ingredient - the type of article - is covered. It is now a question of proving intent. It is clear that the dropping of the spanner may have been accidental, but the proof does not appear from the circumstances or the conduct of the individual. The Crown, under this provision, might have recourse to the known character of the accused person as proved. It might take them back over their whole life’s history. There is nothing so easy to confuse as the known character of a man; it is very difficult, indeed almost impossible, to rebut evidence of it. It puts an intolerable burden upon the accused. The truth is that a man can be accused on the spot, even though there was not a guilty intent, from the mere fact of his political outlook, an extremist political outlook. The type of offence that will be an issue in these offences, it has been conceded by the Government, will be a type of political character. That is the type of thing that will be alleged against him - that he is an extremist, a pacifist or what-have-you.

Let me come to the next matter under proposed section 78 dealing with espionage. Let us see what the position is under that section. Again, we have got several ingredients in these offences. Paragraph (c) of proposed section 78 (1.), provides that if a person for a purpose intended to be prejudicial to the safety or defence of the Commonwealth or a part of the Queen’s dominions approaches, is in the neighbourhood of, is in, enters, inspects or passes over a prohibited place, he is guilty of an indictable offence and liable to imprisonment for seven years. So two things have to be established under this provision - a disloyal intent and, secondly, that he approached - I have taken two only of these elements - or is in the neighbourhood of a prohibited place. The guilty intent can be proved solely from his known character as proved to the court.

I want to cite a case. I was in Albert Park in Melbourne some weeks ago with Senator Kennelly, who is interested in the conduct of the park. With him, I went to a prohibited place - to the exterior of it - and looked through the barbed wire fence at buildings which are to be taken back by the trust over which he presides. Therefore, I approached a prohibited place that was in this neighbourhood and in fact I inspected it. I did all that with a perfectly innocent purpose, but if I had a character - a political character - of the type aimed at in this bill, I could have been convicted of guilty intent. I point out to the committee that scattered all over every town in Australia there are factories that are under this bill prohibited places but which are not proclaimed as such, and which have no notice giving warning of the fact that they are prohibited places. It is obvious to any person with the political taint that is contemplated under this bill that he must keep away from every prohibited place. We will come to that particular proposed section later, and I shall indicate that it is impossible under this bill to know what place is prohibited.

Senator Mattner:

– Who had prohibited the particular area to which you referred, and what was the reason for the prohibition?

Senator McKENNA:

– It is a defence establishment with very many buildings upon it. It is situated on a portion of the park that the honorable senator is seeking to get back from the Commonwealth. I was interested on behalf of the honorable senator in the steps to be taken and the use that could be made of the buildings, and that type of thing, lt is a military establishment. On the face of it, that is clearly a prohibited place. But let me put this aspect of the matter: Nobody enters that park without approaching that place; nobody is in the park without being in the neighbourhood of that place; and nobody looks at it without inspecting it. There is one ingredient of an offence. It is far worse when you move away from defence establishments of that nature and come to a factory making any kind of material for use in defence. It, too, becomes a prohibited place.

Senator Vincent:

– You are not suggesting that a person will be convicted, are you?

Senator McKENNA:

– Indeed, no. I hope nobody would suggest that if I entered upon that defence area I would be charged. 1 am sure my version as to why I was there would be accepted. I merely mention these factors to pinpoint the place. But another person whose political complexion might be regarded differently from my own might fit the type of character contemplated in this connexion. The honorable senator will see that any person of that particular type must stay away from prohibited places, be they private factories or defence establishments or what-have-you. I am merely indicating the extreme power that this provision gives to the Crown by facilitating a prosecution - and in a way that it can be completely unfair to the accused. If the honorable senator upholds the provision, I would be very happy to hear from him in due course just how you rebut the allegation of known character as proved. How do you begin to rebut it? Do you call a whole host of witnesses to deny the truth of the allegation of witnesses who claim your character to be such? It is an exceedingly difficult allegation to rebut and it has such serious consequences.

Senator Vincent:

– You are getting into the realm of what could happen as opposed to what might happen.

Senator McKENNA:

– I merely say to the honorable senator that we as legislators are considering what is possible under this legislation. We are not concerned as to how it will work or how it may be administered. We are just concerned with what may happen under it.

Senator Vincent:

– I would be happy if you would say something about that.

Senator McKENNA:

– Yes. I have dealt with the broad aspect of the operation of this particular provision at this stage. I should certainly like to hear from other honorable senators.

Senator WRIGHT:
Tasmania

.- We have now reached the stage of the consideration of the Crimes Bill when it is necessary for the committee to decide whether or not it is acceptable to have the provision whereby intent in respect of the crime of sabotage and the crime of espionage should be provable by evidence of the known character of the accused as proved. I emphasize at once that I should like to confine my remarks at this stage to the crime of sabotage. It is clear that if a defence article is damaged, the person doing the damage is guilty of the crime of sabotage only if he did it for a purpose intended to be prejudicial to the safety or defence of the Commonwealth. So the important matter for consideration is how this bill enables one to prove that the accused’s action was intended to be prejudicial to the safety and defence of the Commonwealth. The importance of intent as an ingredient of crime is outstanding. I hope that the committee will not get the idea that this is a matter only for lawyers. In the early months of this year we had a decision of the House of Lords on the subject of intent in crimes generally, and the leading article in the “Times” on 22nd November, 1960, brought to the general public the importance of this question. It stated -

Many thoughtful members of the legal profession practising in the criminal courts, as well as academic lawyers, are deeply disturbed by a judgment of the House of Lords in the case of Jim Smith. Why? It is not from concern for Smith … It is felt that the criminal law, by a series of judicial decisions, has now reached a point where the moral basis of it is in peril.

In that case a car was observed by a policeman on point duty to have some stolen goods on the back seat. The policeman bravely jumped aboard and endeavoured to stay with the car. Because the driver of the car was taking avoiding action, the policeman was caused to fall on to the roadway and a car coming in the opposite direction, driven without fault, killed him. The question was whether or not the driver of the first car had intended to kill or to do injury to the policeman. The matter was so important as to reach the House of Lords, which gave a decision to the effect that it was not the intention of the person accused that was in issue. The question was: What was the reasonable and probable intention of the average person doing the act which the accused did? That decision of the House of Lords, as I understand it, is directly contrary to a decision of the High Court of Australia. It raises, as the “ Times “ said, the very moral basis of our criminal law.

With regard to intention in the crime of sabotage, all that is necessary for conviction of the accused is that damage be done to a defence article and that it be shown that the accused intended the damage to be to the prejudice of the safety and defence of the Commonwealth. I cannot do better than to make a brief citation from a leading case on the ordinary principle of the English law as to whether or not, for the purpose of proving intention, one may refer to the accused’s bad character. This high authority stated -

It is undoubtedly not competent for the prosecution to adduce evidence tending to show that the accused has been guilty of criminal acts other than those covered by the indictment, for the purpose of leading to the conclusion that the accused is a person likely, from his criminal conduct or character, to have committed the offence for which he is being tried. In 1934 this principle was stated by Lord Sankey, the Lord Chancellor, with the concurrence of all the learned lords who sat with him, to be one of the most deeply rooted and jealously guarded principles of our criminal law and to be fundamental in the law of evidence as conceived in this country.

In the Attwood case to which Senator McKenna referred, the High Court, with all the exalted authority that comes from its statements, said, as to bad character -

It is not excluded as irrelevant to proof of guilt. It is excluded as a matter of policy, policy deeply rooted in principle.

The significance of such a statement from the High Court, presided over by Sir Owen Dixon, should arrest the attention of every member of the legislature.

The authorities have laid down that when one speaks of evidence of character one speaks not of particular acts of a person but of general character. In the much discussed case of Rowton in 1865, we find an illustration of how prejudicial evidence of character may be. The accused was charged with a crime involving indecency. A witness was called and asked about the accused’s character, the accused having already given some evidence of his own good character. The witness said -

I know nothing of the neighbours’ opinions, because I was only a boy at school when I knew him, but my own opinion and the opinion of my brothers, who were also pupils of his, is that his character is that of a man capable of the grossest indecency and the most flagrant immorality.

Senator Hannan:

– But that was thrown out, was it not?

Senator WRIGHT:

– Yes. That is the sort of evidence that comes up for consideration. In that case, it was thrown out, as Senator Hannan says, because the witness purported to speak of the particular knowledge of himself and his two brothers and because the evidence was not general evidence of the accused’s reputation in the neighbourhood. To show the enormity of evidence of that sort, let us consider the judgment of Mr. Justice Willes, which, although a dissenting judgment, was quoted with such approval by the High Court in Attwood’s case. The court said -

But evidence of character is admissible on the part of the prisoner, not alone what people in general, all the multitude, think of him, which is mere rumour.

That was the viewpoint of the whole court, as I understand it, but the extent of Mr. Justice Willes’s dissent was shown when he went on to say -

But there is also admissible what is known of him generally in the judgment of the particular witness.

My theme is that when evidence of character is given, this decision requires that evidence be given generally of his reputation, which must be hearsay, if you try to rebut such a matter as I have put. If the witness had come forward and said, “ He is a man whose reputation in this neighbourhood is that he is capable of the grossest immorality and acts of indecency “, how does the accused defend himself? The use of that sort of evidence as proof of the intent of a person is so contrary to the cogent requirements of our principles that nothing has yet been said to justify it, in my view. Then we should take into account what the outstanding authority, Wigmore, has said. In volume 1, at page 646, speaking of evidence of character, he says -

It is objectionable, not because it has no .appreciable probative value, but because it has too much. The natural and inevitable tendency of the tribunal, whether judge or jury, is to give excessive weight to the vicious record of crime thus exhibited, and either lo allow it to bear too strongly on the present charge, or to take the proof of it as justifying a condemnation irrespective of guilt of the present charge.

It seems to me, Mr. Chairman, that our civilization should have reached the stage where phobias and witch-hunts are foreign to our courts and only evidence which is acceptable on principle is admitted in them. I submit that a strong case must be made out to justify the reception of evidence of general character which is of a hearsay nature. It is said that the safeguards introduced into the bill, requiring the evidence of character referred to to be relevant to the charge and requiring a direction from the judge to the jury that they shall take the evidence into account only for the purpose of ascertaining the accused’s intent, make the clause safe.

Mr. Chairman, there have been numerous cases in which evidence which was prejudicial to the accused has got before the jury and judges took the view that no reasonable tribunal could be expected to efface the matter from its mind. Decisions of tribunals based upon such inadmissible evidence have been set aside even though without that evidence an ordinary man would decide quite conclusively that guilt had been established.

The CHAIRMAN:

– Order! The honorable senator’s time has expired.

Senator McMANUS:
Victoria

.- The two Australian Democratic Labour Party senators will oppose any provision which permits the known character of an accused to be used against him for the purpose of proving his guilt. We believe that such a provision is contrary to the traditions and the practice of British law. We believe that it would be highly dangerous to introduce such a provision into the law. We are in accord with the submissions on this matter that have been made by Senators McKenna and Wright. We have been fortified in our view by our study of a copy of a legal opinion obtained from eminent counsel by the Federated Ironworkers Association, which has been made available to us.

That opinion sums up our views upon this provision so fully that I propose to read certain parts of it to the Senate. It reads -

The Courts have said that intention can never be directly proved as a fact, it can only be inferred from other facts which are proved.

Senator Gorton:

– Whose opinion are you quoting?

Senator McMANUS:

– An opinion obtained by the Federated Ironworkers Association from Messrs. Kerr and Wootten who, I understand, are members of the legal profession practising at the bar.

Senator Gorton:

– That is right. May I ask when it was written?

Senator McMANUS:

– Yes. It was obtained on 21st October. 1960. It continues -

Courts are quite used to inferring intention “ from the circumstances of the case “. including the immediately relevant “ conduct “ of the accused, aided by a rebuttable presumption that a man intends the natural and probable consequences of his acts. In appropriate circumstances evidence of past similar acts by the accused may be admitted to show intention and rebut accident. But the law has set its face against any general inquiry before conviction into an accused person’s character and past conduct. It is recognized that such evidence, which is not logical 11 proof that he committed the act with which he is charged, may have an overwhelmingly prejudicial effect on the mind of the tribunal. The accused himself has the right to make character an issue in the case, but the prosecution has not. Evidence of “ known character “ (which may be held to mean or include reputation), although tendered only to prove purpose, might have a prejudicial effect not only on that issue, but on disputed issues relating to whether the accused did the act alleged at all, including issues of identification, alibi, etc. A man’s “ reputation “ as a fellow-traveller, friend or associate of Communists could be highly prejudicial. Such a reputation can readily be acquired in political and trade union activity. The provision is repugnant to our legal tradition and is in our opinion, unnecessary. The seriousness of the offence does not, in our view, supply any reason for relaxing normal standards of proof, rather the reverse.

I agree with that. The seriousness of the offence inevitably means more serious penalties. Where that is the position, it could be an argument for not relaxing normal standards of proof. The opinion continues -

People who have in fact committed such serious offences may be felt entitled to little sympathy, but we are concerned with persons merely charged, who may well be innocent, and who should not be placed in a position where mere possession of a bad character may substantially destroy their chance of being found not guilty, notwithstanding that that is the fact. We would recommend that the deletion of these provisions should be sought.

I am prepared to hear argument against that opinion, but to Senator Cole and myself it has compelling force. Therefore, at the moment we believe that our duty is to vote against any provision allowing the known character of the accused to be used against him. We have not been influenced by some of the whipped-up opposition to this and other provisions. We have endeavoured to examine these provisions upon their merits. We have been prepared to give the Government every necessary power to deal with subversion, whether by Communists or by others. The opposition of the Democratic Labour Party to everything associated with communism is well-known, but we do not allow our opposition to communism to lead us to do anything that would prevent an accused Communist, or a person with a Communist record, from getting the fairest of trials. We think that this is the kind of provision that would be found rather in the criminal code of a Communist country. We are proud of the very high traditions of British law, and for that reason we will vote for any amendment that will remove from this bill a provision allowing the known character of an accused to be used against him.

Senator VINCENT:
Western Australia

– Perhaps, first of all, I should say how appreciative I am that the Opposition has endeavoured to debate this absorbing and very important question in a cool and calculated manner. This is somewhat different from the highly emotional manner in which the bill was discussed in another place. With great respect to what has been said about the Senate in recent days in other debates, it does say something for the responsible approach of this chamber towards legislation that both Government and Opposition members can endeavour to debate a proposed piece of legislation quietly and objectively. This legislation certainly warrants calm and considered discussion.

Having said that, I wish to make some reference to what Senator Wright said. 1 agree entirely with one remark he made, namely, that this is not a matter that should be ; restricted to lawyers. Every reasonably intelligent layman understands what is meant by an intention to commit a crime. All members of a jury - and they are all, of necessity, laymen - understand what is meant by intention after the learned judge has summed up. It is a fairly simple matter. I. am a little surprised that a general feeling has grown up that discussion of this piece of legislation, and in particular this evidentiary provision, is the exclusive prerogative ot the legal profession. I do not subscribe to that view. I congratulate Senator McManus on giving us a short expression of his view. I appreciate it, although I do not agree with it.

Senator McKenna has provoked me into complying with his suggestion that I should tell him how I would rebut evidence of known character. Now, of course, I am getting into the realm of lawyers. I mention this in passing because I think it is important. No doubt Senator McKenna has stood before many juries - always, of course, in the capacity of counsel. I think he will agree with me that where there is a right to present evidence that is admissible with respect to character - that occurs frequently, because this is nothing new in law - the prosecutor has to be very careful. He can completely ruin his case if he overplays his hand. In my modest experience in the criminal courts, I have seen many cases ruined for the prosecution because the prosecutor was a little too anxious to submit evidence relating to character. I would go so far as to say that evidence of character is something to be regarded very suspiciously by prosecutors. They can lose more cases than they can win by putting it in.

Normally, if a jury gets the impression that evidence of character has been put in for a purpose, it does not matter very much what the learned judge says. The jury will draw its own conclusions about why the evidence has been given, and those conclusions will not always be to the benefit of the prosecutor’s case. In practical terms, I think that is the real answer to Senator McKenna’s query as to- how evidence of character can be rebutted. As counsel for the defence, in most cases I would welcome a prosecutor introducing evidence of character because the more he does so the more he makes a martyr of my client. I admit that there are exceptions.

I say that just in passing. I do not think it is really quite relevant to the discussion. We are now discussing this matter of evidence of character to prove intent. It is unfortunate that - I am afraid it has been done intentionally - an erroneous slant has been given to the purpose of this particular amendment. Time and time again we have heard, even in the course of the debate in this chamber, allegations that offences of sabotage and espionage, and offences relating to official secrecy, can be established by proof of character. I appreciate the comments of the Leader of the Opposition in that respect. He was very careful to delineate the difference between what I have just said and what has been repeated so often in this debate by people who should know better.

I emphasize that this has nothing to do with the proof of acts of sabotage, or of trespassing or moving physically into a prohibited area, or doing what Senator McKenna was doing - looking through the bars. Those physical acts have to be proved by direct evidence in accordance with the normal laws of evidence. Only then does this provision become significant and available to be relied upon by the prosecutor. He can avail himself of it only when the actual physical act of sabotage, espionage or intrusion upon prohibited areas has been in fact proved by direct evidence. Then, and then only, does the second element of the offence become available to be proved by the prosecution. I repeat that only then does this matter of intention become relevant to the issue at all. Up to that stage it has nothing to do with the case.

If the prosecution does not prove by direct evidence the actual acts of sabotage or of physical intrusion upon a prohibited area by a person, then the prosecution must fail and there is no obligation on the part of the defendant even to go into the witness box. All he has to do is to move for the dismissal of the case, and it will be dismissed. I do not think that that element of this piece of legislation has been emphasized properly. I think a wrong emphasis has been placed far too frequently on this provision by critics of the legislation. It has been done, perhaps, unintentionally, but I am afraid more often it has been done intentionally. I am afraid that sometimes it has been done maliciously - certainly by Communists* - with a complete knowledge of what the bill really means. I emphasize that particular proposition first. I shall have something to say about the legal aspect in a minute or two.

It is important that we all should be quite well aware of what we are debating. We are merely debating proof of intention by adducing evidence of known character. Of course, it can be proved by other means too. I pause there to say that the prosecution will always beware of introducing evidence of known character. There is a very good reason, as Senator McKenna pointed out, why evidence of known character is not admissible in criminal prosecutions. It is a matter of policy. But the honorable senator did not say why it is a matter of policy that, generally speaking, evidence of character is not admissible. With certain exceptions to which I shall not refer for the moment evidence of known character is not admissible against an accused person in order to prove an offence because that evidence would prejudice his fair trial. One must go further than to say that evidence as to character is not admissible because it is a matter of policy, as was mentioned by a learned judge. What the learned judge meant was that it is not admissible because it prejudices the fair trial of a defendant. I repeat that that is why evidence as to character is not, subject to the exceptions of which we are all aware, admissible in a trial under our criminal law.

I will not have time just now to develop all I should like to say, but I hope to have another opportunity later. I propose to advance two propositions. The first is this: I believe it would be fair to say that, as far as that particular element of the law relating to evidence is concerned, it is well established that in certain circumstances - the provisions of this bill happen to provide one such circumstance - it is quite normal legal procedure to admit evidence of character in order to prove intention. Following the decisions in Attwood’s case and earlier cases, I suggest that there is no substance in the argument that in cases where intention is a matter of subjective proof this is a quite new or novel provision. It has been in our criminal law for many years. Although Senator Wright looks rather alarmed, he knows perfectly well that it ‘has been in our law for many years.

Senator Wright:

– A provision regarding the right to call evidence as to character?

Senator VINCENT:

– Yes. It has been in our laws and in the laws of Canada and New Zealand for many years. There is nothing new about it. In cases where the proof of intention is a subjective matter, it is an accepted legal proposition, with certain safeguards which I shall mention later, that evidence as to character may be adduced. It is neither new or against the principles of British law.

Let me indicate how many times those principles have been incorporated in British law. There has been a lot of talk about offences against British justice, natural justice, and that sort of thing. As we hold the British principles of justice in the highest regard, it is interesting to note that the principle we are now discussing has been on the British statute-book in the Prevention of Crimes Act since 1871. It was only in 1949 in Fairbairn’s case, which is reported in volume 2 of the King’s Bench reports at page 690, that the provision in relation to character in the statute to which I have just referred was considered. In that year a judgment was given by the Court of Appeal in relation to the known character provisions. Here I join issue with my friend, Senator Wright, who spoke about the admissibility of evidence of a general nature in relation to the general reputation of persons. In Fairbairn’s case, Lord Chief Justice Goddard is reported at page 693 as follows: -

There is no doubt that under the words of that section if strictly construed the character of the defendant can be given in evidence, and therefore previous convictions can be proved on the question whether he intended to commit a felony.

At page 694, Lord Chief Justice Goddard is reported as having said -

If a man is found loitering in the street and acting in a suspicious manner and it is also found that he has had half a dozen previous convictions-

That is not evidence of a general nature; it is evidence of specific instances of known character - obviously he can readily be regarded as a suspected person by reason of his previous convictions. Those convictions supply evidence of his intention to commit a felony.

We need to be very clear about what we are discussing when we speak about evidence of known character. The case I have just quoted is the ruling case, I suggest, on what constitutes evidence of known character. I point out that the British statute has not the qualifications that this measure incorporates.

Senator Gorton:

– It has not the safeguards.

Senator VINCENT:

– Yes, safeguards.

The CHAIRMAN:

– Order! The honorable senator’s time has expired.

Senator GORTON:
Minister for the Navy · Victoria · LP

– Mr. Chairman, I should like at the commencement of my remarks to say how strongly I agree with the point that has been made by Senator Vincent. It is relevant to point out that the provisions in the proposed clause relating to ability to adduce evidence of character in certain strictly regulated conditions are not new or novel. They have existed in the acts of many nations for many years and for many years have formed a part of the laws of Britain which are the basis of British justice against which this evidentiary clause is sometimes said to offend. That should be clearly understood, because in public discussions in the past there has been a tendency to indicate that this is an entirely novel or new proposal. Nothing could be further from the truth. In point of fact, a similar provision to that proposed in the bill before the committee, also forms part of the Police Offences Act in Victoria, the Vagrancy Act in New South Wales, the Vagrancy and Gaming Acts of Queensland, the British Official Secrets Acts of 1911 and 1920, and the Official Secrets Act passed by the Canadian Parliament in 1939. It is also incorporated in the Official Secrets Act passed by the New Zealand Parliament in 1951 and, of course, it is a part of the Crimes Act which was passed by the Australian Parliament in 1914.

In case some one should say that the provision to which we are referring should not be incorporated because the penalty is severe - it is imprisonment for up to fifteen years - I point out that the evidentiary provision which relates to approaching prohibited places, to which Senator McKenna addressed his argument, is included in the Official Secrets Act passed by the Canadian Parliament in 1939. The penalty provided in that act is imprisonment for fourteen years, just as it is in the 1951 act of the New Zealand Parliament. In our present Crimes Act, which we have had for so long, the evidentiary provision that applies to a different class of offences from sabotage, although the principle is exactly the same, provides for a penalty of seven years’ imprisonment. So, there is no new principle in this matter at all, nor is there anything contradictory to British justice in it.

I point out, in addition, as I did last night, that although we have had experience of the operation of Official Secrets Acts in England for nearly half a century, and in Canada and New Zealand for periods varying between 21 years and ten years, I have yet to hear a case cited in any public debate to show that this evidentiary clause that is incorporated in those Official Secrets Acts has led to the kind of injustice which we have been told it might lead to under certain most exceptional conditions.

Senator McKenna:

– Does the Minister know whether the sections to which he is referring have been used?

Senator GORTON:

– No, I only know that the sections have been included in the acts. I have a fairly strong suspicion that those in this country who wish to point out the dangers which they contend are inherent in this provision, would have carried out considerable research to try to find cases to show that injustice had in fact been done under those provisions. I have not heard of any such cases.

Senator McManus referred to an opinion written by two eminent counsel regarding this provision, but I point out to him that the opinion that he quoted was written before the additional safeguards and amendments were incorporated in the legislation that is now before us.

Senator McCallum:

– I do not know from the men themselves, but I have been told, through the society to which they belong, that they are now satisfied.

Senator GORTON:

– 1 did not know that, and I am glad to hear it. I have not been in touch personally with the eminent counsel concerned and therefore do not know whether they have changed their minds, but I was about to venture the opinion that they might well have done so. I am glad to have the interjection of Senator McCallum that the society to which they belong - I believe it is the Congress of Cultural Freedom - has informed him that they are now satisfied with the amendments.

Perhaps 1 may put before the committee at this stage the fact that Sir John Latham, a former Chief Justice, has expressed himself, since the amendments were written into the bill, as now satisfied that the bill meets all the criteria that he requires.

Senator Wright:

– Could the Minister give us the reference to that expression of opinion by Sir John Latham?

Senator GORTON:

– I shall give the honorable senator the reference later. Sir John was quoted by the Melbourne “ Herald “ newspaper to that effect a week or two ago. The reference would be available in the library, but I shall obtain it for the honorable senator if I have time to do so. In the meantime, he may take my word that a statement to that effect has appeared in a Melbourne newspaper.

Having endeavoured to show that there is nothing new in this provision, that it has operated for a long time in other countries, that no evidence of an injustice as a result of its operation has been adduced, and that some opinions which have been quoted were opinions that were expressed before the bill was amended, I wish to move on to a brief discussion of the question whether, assuming that all those things are so, it is right or wrong for a provision of this kind to be in the bill. Let me take the proposition propounded by the Leader of the Opposition when he was endeavouring to show the serious dangers that might flow from a bill of this kind. He told us that he approached a prohibited place - the

Albert Park barracks or something of the kind - and looked through a wire fence. I presume that he went there in daylight and that his approach was not a furtive one. I presume, also, that on seeing somebody in the distance he did not immediately run away as fast as he could. I take it that, quite openly and in daylight, he approached the wire mesh fence and looked through - without any guilty intent, I hasten to add. As I am reminded, his known character, of course, would immediately be a defence against any charge that was brought against him. But the honorable senator’s point was that if he had the kind of character which could be adduced as evidence of evil intent, he would be imperilled.

I put it to the honorable senator that in circumstances such as those he has described, a man who walked openly, in daylight, up to a fence in a public park without any attempt at concealment, and without any attempt at avoiding attention, who stood and looked through the fence and did nothing, would never be convicted by a jury, on those facts, of having an intent to overthrow the Constitution of the Commonwealth through that action. Merely because he could be shown to have been a member during the war, shall we say, of the Nazi Party, or, in more recent years, of the Communist Party, he could not be convicted. The point that I want to make clear, Sir, is that unless his character was one which tended to show that his action in looking through the fence of a defence establishment indicated that he was going to attack that establishment, he would not be in any peril at all.

If his character was the result of drinking too much, running around with women, gambling or anything of that kind, it would not be admitted as evidence in a trial of the kind that we are discussing. You will notice, Mr. Chairman, that I prefaced those ridiculous suggestions by the word “ if “. No character evidence of that kind would be adducible in a trial in order to show the intent of a person to enter a prohibited place or to divulge an official secret. The only relevant character is that which, it is proved - not merely as a matter of opinion - tends to show that the act itself is a part of a general pattern of his behaviour which would indicate to a jury that he was inclined to commit sedition.

Let us take the opposite example, or the one that Senator McKenna gave. Let us assume that an individual, at night and for the purpose of seeking to avoid notice, approaches a defence establishment. Assume that he has in his pocket a pair of wire cutters when he approaches a wire fence. Assume that when a Commonwealth officer sees him from a distance he immediately runs away. That is a matter of conduct and circumstances but it may well not be sufficient for a jury to convict him of having approached that place with seditious intent. He could have had the wire cutters in his possession because he had been straining some wire fences at home an hour or two before. Perhaps he could produce a witness to substantiate that story. He may have run away because he wanted to be alone, because he did not like other people around him. All kinds of explanations can be given. But if you add to those circumstances and that conduct proof that he is a member of a seditious organization - you must prove this to the satisfaction of a jury - you strengthen your case.

This provision would tend to prevent a guilty man from escaping prosecution and would under no circumstances lead to the conviction of an innocent man. We must bear in mind that the only evidence to be admitted is evidence relevant to the person’s act. The judge in the trial decides what is to be admitted and what is not. The jury will not necessarily hear evidence if the judge is not sure that it should be admitted. The jury may be taken out of the court while the admissibility of the evidence is argued before the judge. The final safeguard is the fact that a jury is a body of common sense Australian people whom we trust for the exercise of justice in our most serious offences.

Senator McCALLUM:
New South Wales

– I think I should say something because I may unintentionally have misled the Senate. I have no right to say that the eminent counsel whose opinions were quoted have altered their opinions. Let me explain what I meant. Sir John Latham, Mr. Kerr, Q. C, and Mr. Wootten were consulted by the Congress of Cultural Freedom, a body whose opinions I respect highly and some of whose members - not lawyers - are friends of mine. When I was discussing this matter with one of the most important members of that body he said that he had been very suspicious of this provision in the bill. He had sought opinions and he was satisfied that this provision was no longer dangerous. All that I have a right to say is that eminent counsel gave opinions on the original bill. Those opinions may not be held by them in respect of the present bill. I hope I put that quite fairly.

Senator McManus:

– The basic principle of their opinions would not be affected.

Senator McCALLUM:

– What are basic principles? This is a matter which nonlawyers have great difficulty in understanding. We have here a great many terms torn from their context and quoted as representing British justice or something like that. They are argued with a great deal of emotion. I understand that they would be cold-blooded terms which lawyers would argue among themselves. It is not possible for a person who is not familiar with the procedures and practices of the courts to form the same opinions as the lawyers - certainly not the opinions that an eminent judge would form.. There has been much confusion of thought. I was fairly confused myself when I began a study of this bill, but I have done my best to understand it. I have read all the speeches that were made on this bill in another place. In addition I have read the opinions of eminent counsel. I think that these terms, torn from their context, used with many asterisks and coloured with emotion, will not enable us to understand what is actually done. What 1 want to know is that the person charged will, have a fair trial.

Everybody has been talking about British justice and laws. There are two systems of justice and laws in the British Isles. There is the legal system of Scotland and that of England. I am not sure that there were not parts of the British. Empire in the old days where French law and Dutch law were administered. The people who believe in the English system of law - we should refer to it as the English system because it is not the British system - think that there is no system comparable to it. I have read of trials in other countries where different systems operate which, as far as I could ascertain, were perfectly fair trials.

All that 1 am concerned to know about this provision of the bill is whether the person charged will have a fair trial and whether the special demands of protecting our troops from sabotage and espionage require that special precautions should be taken. That is a possibility and I leave the matter there. I have spoken only to make an explanation and to seek enlightenment, not to try to enlighten other people.

Senator HANNAN:
Victoria

wish briefly to suggest to the committee that perhaps not sufficient emphasis has been placed on the fact that in prosecutions under this clause, if it becomes law, the full burden of proving the commission of the act remains on the Crown. This contentious provision only becomes operative, relevant and of importance where it is necessary to prove the mind with which the act was in fact done. Let us take, for example, the case of a man who drops a spanner into a power dynamo at a defence radar station. The Crown must prove that he dropped the spanner into the dynamo and that it wrecked the installation. It is then open to the Crown in circumstances such as those to produce evidence of known character in order to prove what the lawyers calls mens rea, or the intent with which the spanner was dropped. If a well-known saboteur or a well-known public enemy were able to commit acts hostile to the Commonwealth and if, when charged with those acts, he could say, for example, that his hands were greasy and the spanner slipped, we would find ourselves in an absurd situation.

I point out that in circumstances such as these evidence of character is not a revolutionary provision. For at least 95 years - since 1865 - of British justice it has been common practice that in certain sets of circumstances the prior convictions and the character of the defendant may be put in issue by the Crown before the defendant has been placed upon his defence.

Senator McManus:

– What cases would they be?

Senator HANNAN:

– I will come to them in a moment. In criminal matters normally it is true, as perhaps Senator McManus suggests, that evidence of prior conviction is not given and evidence of bad character is not normally adduced until after the defendant has been convicted. However, if the defendant attacks the character of prosecution witnesses, immediately his character becomes an issue in the trial, in this connexion I refer to the decision of the Court of Criminal Appeal in 1955 in “ Regina v. Clark “. In that case a man was charged with a crime. When he gave evidence, as he was entitled to do, he said that he had made a confession to the police in relation to the crime, but that he was frightened. He said that the confession that he made was in fact dictated by a police officer and it did nor contain what he wanted to say. He said that it was fabricated by the police. In a simple matter of that sort, the Court of Criminal Appeal said that the defendant had placed the character of the prosecution’s witnesses at issue and it was immediately upon the prosecution to prove the prior convictions and any other matters in relation to the defence. This is very important because, as any criminal lawyer will aver, the matter of adducing evidence of a defendant’s prior convictions is of paramount importance. The matter was pursued further in the collection of cases which the lawyers described as acts showing system.

Senator Wright:

– What was said about that in Clark’s case?

Senator HANNAN:

– I have simply said that in Clark’s case so small a matter as the veracity of the prosecution’s witnesses was placed in issue and immediately the Crown was entitled to cross-examine to adduce evidence in relation to the defendant.

Senator Wright:

– That was because of the nature of the defence.

Senator HANNAN:

– No, the point is this: It was a very mild form of attack upon the credit of the prosecution’s witnesses in Clark’s case. To advert to matters of a like nature I think that since we are dealing with legislation at the end of 1960 it is very difficult to find an exact analogy or an exact precedent for the matters in respect of which we are legislating, but it is not difficult to find precedents for the principle.

The lawyers have an expression, “ acts showing system “ which refers to cases where a defendant is charged with a par ticular offence in which it is open to the prosecution to show that he has committed other acts of a similar nature. The classic decision was that given in the case of Makin versus the Attorney-General for New South Wales, which was determined by the House of Lords in 1894. This case is reported in “ Cockle’s Cases and Statutes on Evidence “ at page 89 as follows: -

Evidence is admissible of similar conduct by the accused on other occasions to show the intention with which the acts alleged to constitute the crime were done.

The prisoners were charged with the murder of an infant child, which they had received from its mother for adoption on payment of a sum insufficient for its support. The child’s body had been found buried in the garden of a house occupied by them. Evidence was held admissible that other children had been received by the prisoners on like terms, and that other children’s bodies had been found buried in a similar manner in the gardens of other houses occupied by the prisoners. A decision in the case was given by Lord Herschell, who said -

  1. . In their Lordships’ opinion the principles which must govern the decision of the case are clear, though the application of them is by no means free from difficulty. It is undoubtedly not competent for the prosecution to adduce evidence tending to show that the accused has been guilty of criminal acts other than those covered by the indictment, for the purpose of leading to the conclusion that the accused is a person likely from his criminal conduct or character to have committed the offence for which he is being tried. On the other hand, the mere fact that the evidence adduced tends to show the commission of other crimes does not render it inadmissible if it be relevant to an issue before the jury, and it may be so relevant if it bears upon the question whether the acts alleged to constitute the crimes charged in the indictment were designed or accidental -

And that is the cardinal point which the prosecution under this legislation would have to meet.

Senator Wright:

– That principle will apply if this provision does not go in the bill, will it not?

Senator HANNAN:

– The principle remains, Senator, certainly. The quotation continues - or to rebut a defence which would otherwise be open to the accused. The statement of these general principles is easy, but it is obvious that it may often be very difficult to draw the line and to decide whether a particular piece of evidence is on the one side or the other . . .

I shall not go into the full facts of this case, because they are of no interest to the committee. I merely wish to state the principles on which Lord Herschell relied in the Court of Criminal Appeal. The footnote to the case reads -

It may be noted that, when evidence of similar facts is admissible, the similar facts may have occurred after the offence charged. For example, on a trial for obtaining eggs by false pretences, it was proved that the accused had falsely represented by advertisements that he was carrying on a bona fide business as a dairyman, and evidence was admitted that, subsequently to the transaction in question, he had obtained eggs from other persons by similar advertisements (R. v. Rhodes (1889)).

I refer to these matters to show that the question of character, of a defendant’s prior convictions and associated matters, is not a new provision; it has been a part of the law of British countries for at least 95 years.

Before referring to the case of Harris versus the Director of Public Prosecutions I should point out that under the provision with which we are dealing evidence as to character must be relevant to the events charged. I take again the example of the workman who dropped a spanner into the dynamo. If a person is charged with that form of sabotage it is not relevant to point out that he has been convicted of rape or manslaughter or has served a fixed term of imprisonment for murder. All these matters are irrelevant to the particular crime with which he is charged. That, I think, greatly limits the dragnet provisions to which the opponents of the measure have objected.

I refer now to the case of Harris versus the Director of Public Prosecutions, which was decided by the House of Lords in 1952. The case was one in which a police constable was charged on eight counts of larceny. I shall not read the whole of the judgment of Viscount Simon, but only sufficient to show the principles upon which his Lordship acted. The head note reads -

Evidence of similar facts must be relevant to the offence charged. The court has a discretion to exclude such relevant evidence when its probable prejudice would be out of proportion to its true evidential value.

In giving judgment, Viscount Simon said -

In my opinion, the principle laid down by Lord Herschell, L.C., in Makin’s case-

That is the case to which I referred earlier - remains the proper principle to apply, and I see no reason for modifying it. Makin’s case was a decision of the Judicial Committee of the Privy Council, but it was unanimously approved by the House of Lords in R. v. Ball (1911) A.C. 47, at p. 71, and has been constantly relied on ever since. It is, I think, an error to attempt to draw up a close list of the sort of cases in which the principle operates: such a list only provides instances of its general application whereas what really matters is the principle itself and its proper application to the particular circumstances of the charge that is being tried. It is the application that may sometimes be difficult, and the particular case now before the House illustrates that difficulty . . .

The substance of the matter appears to me to be that the prosecution may adduce all proper evidence which tends to prove the charge. I do not understand Lord Herschell’s words to mean that the prosecution must withhold such evidence until after the accused has set up a specific defence which calls for rebuttal. Where, for instance, mens rea is an essential element of guilt-

And mens rea is always an essential element in criminal prosecutions and charges under this clause - and the facts of the occurrence which is the subject of the charge, standing by themselves, would be consistent with mere accident, there would be nothing wrong in the prosecution seeking to establish the true situation by offering, as part of its case in the first instance, evidence of similar action by the accused at another time which would go to show that he intended to do what he did on the occasion charged and was thus acting criminally. R. v. Mortimer (1936) 25 Cr. AppR. 150 is a good example of this. What Lord Sumner meant when he denied the right of the prosecution to “ credit the accused with fancy defences” (in Thompson v. The King (1918) A.C. 221, at p. 232) was that evidence of similar facts involving the accused ought not to be dragged in to his prejudice without reasonable cause.

The TEMPORARY CHAIRMAN (Senator Anderson:
NEW SOUTH WALES

– Order! The honorable senator’s time has expired.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I should like to reply briefly to the very interesting debate that has proceeded so far. I say through you, Mr. Temporary Chairman, to Senator McCallum that there has not been the slightest evidence of emotion in the arguments addressed this evening. It amazed me to hear Senator Vincent say that the more evidence of bad character that he listened to in the course of a trial, the better he would be pleased, as he thought that that would invite the jury to react against the Crown. My experience is completely contrary to that. What the honorable senator is really arguing is that there is no need for the principle laid down in the common law for centuries and applauded by five judges of the High Court as recently as March in Attwood’s case. The honorable senator rejects the rule that was founded, as has been put to him, in humanity, and that is a matter of policy, as the High Court judges said.

The honorable senator referred to the application of principles of natural justice and described this as a loose expression. That staggers me, because the honorable senator put it far more elaborately when he dealt with the theme in his speech on the second reading. I merely say to him that case law is literally bursting with cases of prerogative writs issued by superior courts to inferior courts for breaches of the rules of natural justice. I suggest that there are no more explicit rules in case law. Apart from their use in the type of case that I have indicated, the honorable senator will find that in the law relating to the expulsion of members from clubs, for instance, the principles are applied meticulously by the courts. I should have thought there was no more precise concept in law than the concept of principles of natural justice. This term, far from being loose, is of the utmost precision.

Senator Gorton took the point that this provision is not novel. In British law it has its genesis, as he said, in the Prevention of Crime Act of 1871. That was an act relating to vagrancy, which provided for penalties of not more than three months’ imprisonment for offences under it. This shows how evil grows out of a little thing. No doubt, the provision was picked out from there and put into the British Official Secrets Act. The Minister claimed that no injustice had been wreaked under that section. I put it to him across the table that there were no instances in which it had been used. I am informed, on authority that I respect, that there is no reported case upon the subject. I incline to the belief that prosecutors in those countries that have adopted this law have been. very properly and decently, ashamed of a provision that would throw overboard rh- great common law principles, and I s”»w<’ that they would not demean them.selves i,… bavins recourse to the door that was open to them. In the view that I take, that is the explanation, and I think that it is the proper explanation. One would expect that, if the provision were in the legislation of quite a number of countries, then, having regard to the unfortunate modern development of spying and that type of thing, which were most rare offences 50 or 60 years ago, it would have been used and we would have had some judicial decisions upon it. I suggest that that argument from the honorable senator does not help the position at all.

He said that a somewhat similar provision appears in State legislation. That is right, to an extent. It certainly does not apply to major crimes. It applies only to matters that do not involve great moral turpitude, such as vagrancy and gaming, and that do not carry a penalty of imprisonment for more than one year.

Senator Vincent:

– Offences of which intention to commit a crime is one of the elements.

Senator McKENNA:

– That is an element of every offence, however major or minor. The honorable senator must recognize it as elementary that there must be mens rea - a guilty mind - in relation to any offence, whether major or minor. That is not relevant at the moment. I want to come back to the State law. It is not true that this provision is completely comparable with that. There is an important distinction. The State law permits the known character of the accused to be used only when coupled with the circumstances of the case. The expression is, “ If from the circumstances of the case and the known character as proved “. Three matters - circumstances of the case, conduct of the accused, and known character as proved - are set up as completely alternative matters in the law we are considering. Under the State law you have to combine two elements - the circumstances of the case and known character. The two elements have to be present. Under this provision, one element alone - known character as proved - may be selected by the prosecution to prove intent. Therefore, the State law and the proposed Commonwealth law are clearly separate and distinguishable.

Senator Gorton:

– How can you bring a case without the. circumstances of the case becoming evident to the court?

Senator McKENNA:

– That is a factor that has to be present under the State law we are talking about before the element of known character can be imported. The very case for which this clause provides is the case in which the act itself does not give any indication of intent. The mere dropping of a spanner into a machine by a workman may be or may not be sabotage. The act itself may be innocent or guilty. How would the circumstances of that case help? Is that not the very reason why the Crown seeks recourse to the known character as proved? A man’s proved political character, not proximate at all to the act of dropping the spanner, is resorted to in order to establish guilty intent. That is the whole reason for objecting to the clause.

I was able to listen to the whole of Senator Hannan’s speech. He referred to the fact that under the existing law evidence may be given of a system of acts. I concede that. I heard Senator Wright’s interjection to the effect that if this provision were struck out, that would still be the position in law. I agree entirely with that view. This is where Senator Hannan failed to distinguish the position: If a man had been acting to a pattern in committing acts of sabotage, such evidence would then be relevant. But where a man is charged with one act of sabotage and he can be proved guilty from his political affiliations or his known character in some kind of political context, that is not establishing system; it is resorting to his character as proved or as known for the purpose of establishing intent. If he had been pursuing a course of conduct of act after act of sabotage, the principle which Senator Hannan mentioned would apply. I agree entirely with Senator Wright’s statement that the striking out of this provision would not affect the recourse of the prosecution to that type of evidence.

As I have indicated earlier, the Opposition feels most strongly on this matter. In this debate we are now disposing of it in respect of espionage and breaches of official secrets, as well as in respect of sabotage. I propose that we vote on all three at the one time.

Senator VINCENT:
Western Australia

– I wish to advert to one or two statements made by the Leader of the

Opposition. He commenced by agreeing with the Minister that the principle involved in this section of the legislation was originally enacted in Britain in 1871 in the Prevention of Crimes Act which, as is well known, is an act that does not cover the trial of major crimes. But the Leader of the Opposition omitted to mention that it has been included in the British Official Secrets Act of 1911 in respect of major crimes relating to breaches of official secrets, and that it was taken almost verbatim from the British acts by the Fisher Labour Government in 1914 and put into section 78 of our Crimes Act, where it still is. It was there during the whole time that my friend, Senator McManus, was a member of the Australian Labour Party. I have not been able to find any record to show that he objected to it during that period. So, it comes as somewhat of a surprise to me that he now objects to it. Of course, that does not prove - I am not suggesting that it does - that it should not be in the statute now.

Senator Toohey:

– This Government has been in office for eleven years.

Senator VINCENT:

– The honorable senator will have an opportunity to speak on this matter shortly.

Senator Toohey:

– I am only trying to ask a question, but yon do not want to answer it.

Senator VINCENT:

– I will answer it, if you will let me develop my argument. This principle has remained in the statute since 1914, I think very properly. Three Labour governments - the Scullin Government, the Curtin Government and the Chifley Government - have permitted it to remain in the act.

Senator McManus:

– There has never been a case in which it has been invoked.

Senator VINCENT:

– Precisely.

Senator Gorton:

– In Australia.

Senator VINCENT:

– Senator McManus has put the words in my mouth. Of course there has not been such a case. Probably that is a very good reason why those three Labour governments permitted this section to remain in the act. They felt that there was no good reason why it should not be there. There have not been any unfortunate consequences, such as those that are predicted by the Leader of the Opposition and Senator McManus, flowing from this section since 1914. I do not suggest that that in itself proves that the section should remain in the act, but surely the onus is now upon the Australian Democratic Labour Party and the Australian Labour Party Opposition - not upon the Government - to establish that the provisions of this section are objectionable. I think that is a fair argument.

Senator McManus:

– Do you not think that there is proof that the principle is objectionable when the legal profession holds the view that it is repugnant to the principles of British justice?

Senator VINCENT:

– The legal profession does not think it is repugnant. The legal profession in Great Britain thought it was a good principle when it was originally placed in legislation in respect of minor offences in 1871, which is now almost 90 years ago, and in major legislation relating to subversion and breaches of official secrets in 1911, and it has been kept in those acts.

In the last month we have been talking a lot about British justice in relation to this bill. British justice saw fit to include the principle in an act in 1911 and review it in 1922, and it has been kept there by Labour administrations. British justice saw fit to put it in an Australian act in 1914. That was done by a Labour administration. I am not arguing that that proves that it is a good provision; I am merely saying this: Eminent Canadian lawyers in 1939 thought it suitable to introduce into Canadian legislation a provision identical with the provision in our existing legislation and because eminent New Zealand lawyers in 1956 thought it suitable to put it into the New Zealand law. In the period from 1871 to 1956 British jurists in Great Britain, Canada, New Zealand and Australia - some of them under Labour administrations - thought that this was a fit and proper provision to be put on the statute-books

I do not say that that in itself proves that this is a good provision; but, as Senator McManus says, there has been no evidence of any unfortunate consequences flowing from it. Surely, in those circumstances the onus is on Senator McManus and the Australian Labour Party to prove that the consequences are objectionable. I merely say that in passing because I want to get away from that subject of what can be assumed from previous legislation. Quite frankly, I do not think that we should assume that that is the reason for the existence of this provision. I am not hinging my argument in respect of this piece of legislation upon the fact that the British introduced the principle in 1871 or the Canadians introduced it in 1939. I suggest that there are other than legal reasons why such a provision should be on the statute-book. I believe it can be established - I have tried to establish it - that as far as jurists are concerned, there is nothing repugnant to British legal principles in the provision that is already in section 78 of the Crimes Act. I do not intend to argue it any further, unless somebody wishes to join issue with me again.

There are other factors that we should consider, which have not been referred to very much to-night. As the act stands to-day, as it was introduced by a Labour government, I venture to suggest that possibly there are or could be dangers in it. I am quite well aware that many of the offences that could be triable and will be triable under these provisions will be committed in a highly political, inflammable atmosphere. I am quite prepared to believe that. I think one must accept that. I believe that, particularly in time of war, we must be very jealous of our principles of justice in trying offences such as these because many of them are political in flavour. I admit all that. That imposes an obligation on this chamber to make certain that every safeguard is provided. I submit that every safeguard has been used. I think that is a fair proposition, and I wish to establish it now. The existing law can be improved, and I think it is being improved by this bill. We have a bald provision at the present time in section 78 (2.) that provides that on a prosecution under that section it shall not be necessary to show that the accused person is guilty of any particular act tending to show a purpose prejudicial to the safety or interests of the Commonwealth, and he may be convicted from the circumstances of character. I think that provision probably has weaknesses in it. In the heat of the emotion that is sometimes aroused during trials with political elements, juries could be affected, and the Attorney-General has very wisely inserted two important provisions which, I think, adequately safeguard the trial of anybody, even in the height of political emotion.

I am quite surprised that these safeguards have not been referred to in this debate. I wonder whether Senator McManus has read them very carefully. They are contained in proposed sub-section (4.) on page 14 of the bill. The first is a very important safeguard. Evidence of character is not admissible if it -

Would not tend to show that the purpose of the defendant was a purpose intended to be prejudicial to the safety or defence of the Commonwealth.

I am not going to develop that, because 1 have not the time to do so. That in itself relates the evidence of known character right to the question at issue. It is useless for people to get up in this chamber and say, as Senator McManus did, that there would be great danger in looking through a barbed wire entanglement in some swamp in Melbourne, and that if a person who did that had a criminal record, or had been a known member of the Communist Party, he could be convicted under this section. The point blank answer is that he could not. His known criminal record would have to be related to the purpose at issue. It would have to be related to the res gestae. That is an important safeguard which is not in the British or Canadian law. It is the safeguard that Senator McManus really wants, but, with all respect, I do not think he understands it.

The second safeguard is even more important. It has some bearing on Attwood’s case, because it is on all fours with that decision. Attwood’s case decided that evidence relating to character is not admissible, and a judge should refuse to admit it, if it would prejudice the fair trial of the defendant. I think every lawyer will admit that that is really all that Attwood’s case says and that at the present time that is the common law of Australia. The Leader of the Opposition referred to Attwood’s case, which says that an accused can be asked questions tending to show that he is of bad character if such questions are relevant to whether he did or did not commit the offence charged. With the greatest respect, 1 submit that the present legislation conforms substantially to Attwood’s case. I invite the Leader of the Opposition to distinguish between Attwood’s case and the collective effect of the existing law plus the two safeguards that have been introduced by the Attorney-General in this legislation.

As a lawyer, I submit that the sum total of those two qualifications in the proposed legislation in fact conform with Attwood’s case and give every possible protection to a person who is not guilty of an offence. On the other hand, they observe the principles of justice with respect to the admissibility of evidence. After all, justice has to be done between the Queen and the accused and a fair verdict given. I think that under this proposed legislation a fair verdict will be given in all circumstances.

Senator McMANUS:
Victoria

– I will not delay the Senate but I wish to say that Senator Hannan and Senator Vincent have ranged all over the world in an endeavour to find instances of this kind of provision being included in the law. All they have shown is that the provision is so rare that where it occurs to-day it is more or less a legal curiosity.

Senator Vincent:

– That is not a fair comment.

Senator McMANUS:

– A lot of challenges were thrown about while I was in my seat. If other people throw challenges about, I am justified in saying something in reply.

The other thing I wish to say is this: If this is such an essential and admirable provision, it is strange that, as far as I can ascertain, it is not the subject of any reported decision either in Great Britain or Australia, and has probably never been invoked. Senator Vincent said that that indicates that it must be a quite harmless provision. My view is that the legal profession think it so repugnant to the ordinary traditions of British justice that they prefer not to make use of it.

I still stand upon the principles that are set out in the legal opinion I quoted. I do not think that the safeguards of the type mentioned by Senator Vincent in any way affect those principles. I therefore am confirmed in the view that I should vote against the provision contained in the bill.

Question put -

That the words proposed to be left out (Opposition amendments Nos. 20, 30 and 35 - vide pages 2155, 2156 and 2157) be left out.

The committee divided. (The Chairman - Senator the Hon. A. D. Reid.)

AYES: 26

NOES: 30

Majority . . 4

AYES

NOES

Question so resolved in the negative.

Clause 24 agreed to.

Clause 25 agreed to.

Clause 26. (Opposition amendments Nos. 21 and 22.)

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition Amendment No. 21.) Proposed section 24f, sub-section (1.), after paragraph (e) insert the following paragraph: - “ (f) to do anything in good faith of a substantially religious or humanitarian character. “.

Proposed new section 24f(1.) will make it lawful to do various things, despite the provisions relating to treason, treachery and sabotage. It will enable people to be critical of our own country and our own government, and also of other countries and their governments. The Government made sure that its amendment of the existing law had application to those main offences, in addition to the offence of sedition. The Government’s amendment is in line with an amendment that the Opposition in another place proposed, and we are happy with what is in the proposed new section. But we are still concerned about a matter which has been omitted. When the original draft of the bill was under criticism, the Attorney-General (Sir Garfield Barwick) gave an assurance publicly that it did not apply to anything connected with an industrial dispute or matter. He also gave an assurance that it did not touch upon any religious or humanitarian matters. He was good enough to include in the bill a provision that it would not be an offence for a person to do anything in good faith in connexion with an industrial dispute or an industrial matter. But he would not take the next step and exempt anything done in good faith of a substantially religious or humanitarian character. I cannot understand why he did not act in relation to that matter in a manner similar to that in which he acted in relation to industrial disputes and matters.

A proclaimed enemy of a proclaimed country might be in an area in which missionaries are active or where qualified medical practitioners, either deliberately or by chance, are temporarily providing assistance. The provision of services of a religious character in many countries would include looking after the physical needs of the natives. To help natives by providing them with food, or to assist them to grow food or to improve their productive capacity may well be taken to be assisting the enemy by any means, as the various sections provide. I know that intent also has to be proved. Intent can be proved by adducing evidence as to the known character of the person concerned. A doctor may be in an area occupied by a proclaimed enemy not of our own country but of another country, and he may feel compelled, by reason of the nature of his profession, to give aid to the wounded. He could be charged with treachery. Of course, I concede that the known character provision does not apply in that case, or in relation to treason. But I believe the Government would have been well advised to have accepted the Opposition’s amendment. I trust that, upon further consideration of the matter, the Government will be disposed to accept it.

Senator GORTON:
Minister for the Navy · Victoria · LP

– Briefly, the view of the Attorney-General is that acts which can be carried out in good faith - for example, attempting to change the mind of the Parliament or attempting to persuade the Sovereign’s counsellors that they are wrong - are acts which, in certain circumstances, can be regarded as being ambiguous and that therefore it is necessary to say specifically that they cannot be the subject of prosecution or conviction. But the Attorney-General takes the view - I think it is a reasonable one - that religious or humanitarian acts genuinely performed are not really ambiguous and could not really be considered to be done for the purpose of overthrowing the Constitution by force, of committing sedition or of disclosing official secrets, and that therefore they do not need to be included in the proposed new section. 1 should say that it would be quite proper and quite safe under this legislation for a doctor who perhaps was caught in the back-wash of a clash in Asia casually, in accordance with his Hippocratic oath, to bind up the wounds of people wounded in his vicinity.

But, of course, it would be quite wrong for him to enlist as a doctor in the service of an army, or a force associated with an army, of a proclaimed country or of an enemy of Australia. There are distinctions, but in general, the answer is that a genuinely religious or humanitarian act is presumed to be what it is on the face of it. Such an act would not be considered to have as its purpose the overthrow of the Government.

Consideration interrupted.

The CHAIRMAN (Senator the Hon. A. D. Reid). - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -

That the Chairman do now leave the chair and report to the Senate.

Question resolved in the negative.

Consideration resumed.

Senator McKENNA:
Leader of the Opposition · Tasmania

– It may be convenient for the committee, Mr. Chairman, to deal with Opposition amendments Nos. 21 and 22 simultaneously and to dispose of them by the one vote. There being no objection to that course being followed, I move - (Opposition amendment No. 22.) Leave out paragraphs (c) and (d) of sub-section (2.) of proposed section 24f.

Paragraphs (c) and (d) relate to the proclaiming of friendly countries and the proclaiming of their enemies. We have already expressed objection to this proposal, and we have debated it at length. We shall vote against these provisions as a protest against the proclamation of countries. I have already made the Opposition’s views quite clear.

Question put -

That the words proposed to be inserted (Oppotion amendment No. 21 - vide page 2174), be inserted.

That the words proposed to be left out (Opposition amendment No. 22 - vide page 2175), be left out.

The committee divided. (The Chairman - Senator the Hon. A. D. Reid.)

AYES: 22

NOES: 33

Majority . . ..11

AYES

NOES

Question so resolved in the negative.

Clause agreed to.

Clauses 27 to 29 agreed to.

Proposed new clause (Opposition amendment No. 23.)

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 23.) After clause 29, insert the following new clause: - “ 29a. Sections thirty j to thirty r (inclusive) of the Principal Act are repealed.”.

The sections referred to in the amendment form a major portion of Part IIa. of the Crimes Act and were inserted in 1926. The first provisions of that part deal with unlawful associations and the penalties that attach to members of associations declared to be unlawful. We are not contesting those provisions. We pick up the part at section 30j, which appears on pages 18 and 19 of the principal act. There are three main objections to the provisions in this part.

Senator Wright:

– I rise to order, Mr. Chairman. There has been no instruction to the committee in relation to these sections, which are in the principal act, and I submit that the proposed amendment does not relate to the provisions of the bill.

The CHAIRMAN:

– Order! As Senator Wright has stated, the proposed amendment is not relevant to the subject-matter of the bill. It could be relevant to the original act, but as no instruction has come to the Committee of the Whole under Standing Order No. 332, the amendment is out of order.

Senator McKENNA:

– I accept that ruling in the light of earlier decisions of the committee and of the Senate. I shall take the opportunity, after the committee stage, to have the amendments in issue.

Clauses 30 to 48 - by leave - taken together, and agreed to.

Clause 49. (Opposition amendments Nos. 24 and 25.)

  1. Section seventy of the Principal Act is repealed and the following section inserted in its stead: -

” 70.

” (2.) A person who, having been a Commonwealth officer, publishes or communicates, without lawful authority or excuse (proof whereof shall lie upon him), any fact or document which came to his knowledge, or into his possession, by virtue of his office, and which, at the time when he ceased to be a Commonwealth officer, it was his duty not to disclose, shall be guilty of an offence.

Penalty: Imprisonment for two years.”.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 24). Proposed section 70, sub-section (2.) leave out “ (proof whereof shall lie upon him) “. (Opposition amendment No. 25). Proposed section 70, sub-section (2.), after “ disclose “ insert “ and which at the time of publication or communication had not been published or made known to the public”.

The Opposition’s amendments relate to the proposed section that deals with Commonwealth officers disclosing information after they have left the service - information that was secret at the time they left. As the provision stands it would remain binding on such officers unless they got specific permission to disclose information. The Opposition sees the possibility that what was secret when an officer left the service may well have ceased to be secret at a later stage by reason of .the fact that it has become public knowledge without contravention of the act. We think that the provision could be improved by our amendment No. 25.

The other matter with which the Opposition is concerned is the fact that the onus of proving that he had lawful authority is cast upon the person who may be accused under this clause. We object to this for reasons that we have stated repeatedly in this place. We think that the onus of proving an offence which renders an accused person liable to imprisonment for two years should fall squarely on the prosecution. This matter is covered by our amendment No. 24. We feel that our amendments, if accepted, will improve this provision.

Senator GORTON:
Minister for the Navy · Victoria · LP

– Section 21c of the principal act states -

  1. . any act, if done without lawful authority, or without lawful authority or excuse, or without permission, is an offence against that law, the burden of proving that the act was done with lawful authority, or with lawful authority or excuse . . . shall be on the person accused.

It is true that the deletion of the words in question could be effected without altering the present position. But even if those words were deleted, under section 21c the burden of proof would still lie on the person concerned. For the sake of uniformity those words have been included.

With regard to the publishing of matter by a person who has ceased to be an officer of the Commonwealth Service, I am informed that it would be a perfectly lawful excuse if the matter disclosed had become public knowledge before it was disclosed by the person concerned.

Question put -

That the words proposed to be left out (Opposition amendment No. 24 - vide page 2176), be left out.

That the words proposed to be inserted (Opposition amendment No. 25 - vide page 2176), be inserted.

The committee divided. (The Chairman - Senator the Hon. A. D. Reid.)

AYES: 21

NOES: 33

Majority . . 12

AYES

NOES

Question so resolved in the negative.

Clause agreed to.

Clauses 50 and 51 agreed to.

Clause 52. (Proposed section 77.) (Opposition amendment No. 26.)

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 26.) Proposed section 77, after sub-section (1.) insert the following sub-section: - “ ‘ (1a.) The foregoing definitions shall apply only to matters which are material to the safety or defence of the Commonwealth or of a part of the Queen’s Dominions.”.

This brings us to Part VII., which deals with espionage and official secrets. Proposed section 77 deals with definitions, which are applied throughout the operative sections establishing the offences of espionage and the breaching of official secrecy. They are exceedingly wide. For instance, “ article “ includes any thing, substance or material. There is a very wide definition of “ cipher “. “ Information “ is defined as meaning -

Information of any kind whatsoever, whether true or false and whether in a material form or not, and includes -

an opinion; and

a report of a conversation; “ Model “ plan “ and “ sketch “ are very widely defined. The Opposition feels that they are too widely defined, having regard to the offences that pick them up. For instance, it is an offence under proposed section 78 (1.) -

If a person for a purpose intended to be prejudicial to the safety or defence of the Commonwealth or a part of the Queen’s dominions -

makes a sketch, plan, photograph, model, cipher, note, document or article thai is likely to be, might be or is intended to be directly or indirectly useful to a foreign power;

And paragraph (b) refers to obtaining, collecting, and things of that sort. Paragraph (c) is applied to a person who - approaches, is in the neighbourhood of, is in, enters, inspects or passes over a prohibited place.

The purpose of the amendment is to narrow the application of the definitions by providing that they shall apply - only to matters which are material to the safety or defence of the Commonwealth or of a part of the Queen’s dominions.

There ought to be no objection to having the definitions narrowed to that extent. The crimes of espionage and breach of official secrecy are important only in relation to the safety and defence of the Commonwealth, and they ought to be tied to that.

Senator GORTON:
Minister for the Navy · Victoria · LP

– I reply to the submissions of the Leader of the Opposition by informing him that in fact, the matters referred to in this proposal are already matters which are limited to matters for purposes of defence because the different definitions apply to matters material to defence since the terms defined are used to define offences that can only be carried out for a purpose intended to be prejudicial to defence. “ Defence “, of course, might be as wide as is necessary, but the important point is that there must be an intent to do something for purposes prejudicial to matters of defence. That is the limitation in that matter. As to the other arguments advanced by Senator McKenna, I point out again that the prime matter in this is the intent which must be proved before a crime can be said to have been committed!

Question put-

That the words proposed to be inserted (Opposition amendment No. 26 - vide page 2177), be inserted.

The committee divided. (The Chairman - Senator the Hon. A. D. Reid.)

AYES: 20

NOES: 33

Majority . . 13

AYES

NOES

Question so resolved in the negative.

Sitting suspended from 11.29 p.m. to 12.5 a.m.

Thursday, 8 December 1960

Clause 52 (Proposed section 78). (Opposition Amendments Nos. 27 to 29.)

Senator McKENNA:
Leader of the Opposition · Tasmania

.- I move - (Opposition amendment No. 27.) Proposed section 78, sub-section(1.), paragraph (a), leave out “likely to be, might be or is “. (Opposition amendment No. . 28.) Proposed sec tion 78, sub-section (1.), paragraph (b), leave out “likely to be, might bo or is”. (Opposition amendment No. 29.) Proposed section 78, sub-section (1.), paragraph (c), leave out “ approaches, is in the neighbourhood of,”.

Amendment No. 27 relates to the offence of espionage. If a person with disloyal intent does certain acts in relation to a document, an article or a thing of that nature that is likely to be, might be, or is intended to be directly or indirectly useful to an enemy or a foreign power, he is guilty of an indictable offence. The Opposition objects to the words “likely to be, might be or is”. We propose that they be eliminated to make the offence relate to making a sketch, &c., that is intended to be directly or indirectly useful to an enemy or a foreign power.

Amendment No. 28 is designed to have the same effect in relation to the crime described in paragraph(b) of proposed sub-section (1.). Amendment No. 29 deals with the offence of approaching, being in the neighbourhood of, being in, entering, inspecting or passing over a prohibited place. In another context I addressed myself at some lengthto that matter, when we were dealing with the evidentiary provision relating to known character as proved. I think that I then gave all the instances of the width of that power that I want to give the committee.

Senator GORTON:
Minister for the Navy · Victoria · LP

.- If amendment No. 27 and amendment No. 28, which seek the removal Of the words” likely to be, might be or is “, were agreed to, the effect would be to limit an act of this kind to one that was intended to be of assistance to an -enemy. The element of intention is there already, because before an act can became a crime it must be done with the intent of overthrowing the Constitution or doing something of that kind. The words proposed to be left out are already in section 78 of the principal act They have merely been repeated in the bill.

Amendment No. 29 relates to people approaching or being in the neighbourhood of a prohibited place. I point out that intent, which must be proved before a judge and jury, is the operative matter. The words proposed to be left out are already in the principal act and no extension is proposed by the bill.

Amendments negatived.

Clause 52. (Proposed section 79). (Opposition amendments Nos. 31 to 34.)

  1. The heading to Part VII, of the Principal Act and sections seventy-seven, seventy-eight and seventy-nine of the Principal Act are repealed and the following heading and sections inserted in their stead: - “Part VII. - Espionage and Official Secrets.

” 79.-

” (5.) If a person receives any sketch, plan, photograph, model, cipher, note, document, article or information, knowing or having reasonable ground to believe at the time when he receives it, that it is communicated to him in contravention of section seveny-eight of this Act or sub-section (2.) of this section, he shall be guilty of an indictable offence unless he proves that the communication was contrary to his desire. ” (6.) If a person receives any sketch, plan, photograph, model, cipher, note, document, article or information, knowing, or having reasonable ground to believe, at the time when he receives it, that it is communicated to him in contravention of sub-section (3.) of this section, he shall be guilty of an offence unless be proves that the communication was contrary to his desire.

Penalty: Imprisonment for two years.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 31). Proposed section 79, sub-section (5.), after “If” insert “, otherwise than for the purposeof transmitting it with all reasonable despatch to a person in lawful authority,”. (Opposition amendment No. 32). Proposed section 79, sub-section (5.), leave out “ he proves that”. (OppositionamendmentNo. 33). Proposed section 79 sub-section (6.), after “If” insert “, otherwise than for the purpose of transmitting it with all reasonable despatch to a person in lawful authority,’’. (Opposition amendment No. 34). Proposed section 79, sub-section (6.), leave out “ he proves that “.

These amendments relate to the crime of breach of official secrecy. They refer to proposed section 79. The Opposition proposes that in sub-section (5.) the following words be inserted after the word “ if “ -

Otherwise than for the purpose of transmitting it with all reasonable despatch to a person in lawful authority.

The sub-section sets up the offence in these terms -

If a person receives any sketch, plan, photograph, model, cipher, note, document, article or information, knowing or having reasonable grounds to believe, at the time when he receives it, that it is communicated to him in contravention of section 78 of this Act or sub-section (2.) of this section, he shall be guilty of an indictable offence . . .

We think that the amendment should be made in order to provide for the possibility that a person may receive something, even if he knows that it was obtained from a person who got it in contravention of the act, for the purpose of transmitting it to somebody in lawful authority. The subsection contains the extraordinary provision that the onus of proving that the communication to him was contrary to his desire is on the accused. We advance the argument that we used a little while ago. We object to that onus. We suggest that the relevant words be deleted. Senator Gorton referred me to section 21c which still leaves the onus on the accused. No doubt the Opposition might have addressed its mind to correcting that section with advantage. We have not done that, so I content myself with moving amendments Nos. 31 and 32 to proposed sub-section (5.). I have moved an exactly similar set of amendments in amendments Nos. 33 and 34. They are in similar terms, with a similar effect in respect of the lesser offence which attracts a penalty of imprisonment for only two years. The arguments I have advanced in support of amendments Nos. 31 and 32 apply equally to amendments Nos. 33 and 34.

Senator GORTON:
Minister for the Navy · Victoria · LP

– The view of the Attorney-General (Sir Garfield Barwick) is that there are already safeguards in the receiving provisions in the present section 79 of the Crimes Act. In the first place, the prosecution must prove beyond reason able doubt that the accused received the article or information. In order to establish the offence of receiving, it is not sufficient merely to show that he has the article or information in his possession. Secondly, the prosecution must prove beyond reasonable doubt that the accused knew at the time he received it that it was being communicated to him in contravention of Part III. of the act. Thirdly, even where the prosecution can succeed in proving those two elements of the offence, it remains open to the accused to show that the article or information was communicated to him contrary to his desire. So there are already fairly good safeguards in the act to cover the contingencies which have been worrying the Leader of the Opposition.

In regard to the onus of proof provisions, which are the subject of amendments Nos. 32 and 34, I point out that even if the words sought to be removed were removed from the provisions to which the amendments refer, the position would be almost the same as it would be with the words in them. I refer the Leader of the Opposition to section 14 of the Crimes Act which provides as follows: -

Where any person is charged . . . with an offence against the law of the Commonwealth, any exception, exemption, proviso, excuse, or qualification, whether it does or does not accompany the description of the offence in the section of the law creating the offence, may be proved by the persons charged . . .

Senator McKenna:

– That is only when the offence is prosecutable summarily.

Senator GORTON:

– That may well be so.

Senator McKenna:

– The section reads, “ Where any person is charged, before a Court of Summary Jurisdiction . . .” Section 14 would not apply to a prosecution on indictment, so the amendment would be relevant in those circumstances.

Senator GORTON:

– That argument is conceded by the advisers to the AttorneyGeneral. However, the principle applies to summary prosecutions under the act. It should not be difficult to show that secret information was received in a particular way, and the Government would prefer to leave the words, which the amendments seek to delete, in the bill.

Amendments negatived.

Senator McKenna (Tasmania - Leader of the Opposition) [12.16 a.m.]. - I move - (Opposition amendment No. 36.) At end of clause add the following proposed section: - “79a. This Part shall not apply to anything which is or has been made available to the public or is or has been a matter of public knowledge without contravention of this Act.’.”.

Because of the existence of Standing Order No. 201 which operated detrimentally to me in respect of Opposition amendment No. 23, we have been obliged to tag this amendment on to an existing clause in order to avoid the operation of that Standing Order. The amendment is not particularly relevant to proposed section 79. It is meant to apply to the whole part.

I have already made it clear just how wide the net is cast in the definitions of crimes sections of this part. It picks up almost any article, particularly articles that form part of or are in prohibited places which are not defined and identified. This amendment is intended to achieve the real purpose of the Crimes Act, namely to ensure that it will not apply to anything that has been made available to the public or has been a matter of public knowledge without contravention of the act. It is quite conceivable that articles such as time-tables, land maps and maps of naval soundings, which are available to the public at large, could be useful to an enemy. They are included in this proposed new section. We seek to exempt articles that have been made available to the public without contravention of the act. This is one dragnet clause designed to narrow the exceedingly wide net which the Government has cast in redrafting the bill.

Senator GORTON:
Minister for the Navy · Victoria · LP

– The view of the Attorney-General (Sir Garfield Barwick) is that this amendment, which seeks to insert a new clause to the effect that part VII shall not apply to anything which is or has been made available to the public or is or has been a matter of public knowledge without contravention of the act, is not strictly necessary because the same result is achieved by the requirement of “ prejudicial purpose “ which is already in the act. If a thing had been made public without contravention of the act, a person could hardly have a purpose intended to be prejudicial to defence in subsequently communicating that thing, unless he did not know that it had been made public or unless its communication at the time and place charged gave it a special significance. In either of those cases, a person could have a purpose intended to be prejudicial to defence with immunity if the Opposition’s amendment were accepted. That is a rather far-fetched example. The real point is that if a thing had been made public it could not be communicated with a prejudicial intent.

Amendment negatived.

Clause agreed to.

Clause 53.

  1. Section 80 of the Principal Act is amended -

    1. by omitting from paragraph (b) the words “ or stored,” and inserting in their stead the words “ obtained, tested or stored “;

Section proposed to be amended -

  1. The following places shall be prohibited places: -

    1. Any place not belonging to the King or the Commonwealth where any ship, arms, or materials or instruments of use in time of war, or any plans or documents relating thereto, are being made, repaired, or stored, under contract with, or with any person on behalf of, the King or the Commonwealth;
Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 37.) After paragraph (e) insert the following paragraph: - “ (ea) by adding at the end of paragraph (b) the words ‘ which is for the time being declared by the GovernorGeneral to be a prohibited place for the purposes of this Part of this Act, on the ground that information with respect thereto or damage thereto would be useful to an enemy or to a foreign power ‘;”. (Opposition amendment No. 38.) At end of clause add the following paragraph: - “ (j) by adding at the end thereof the follow ing sub-section: - (2.) No place declared by the Governor-General to be a prohibited place pursuant to this section shall be deemed to be a prohibited place for the purposes of this Act unless there is exhibited at each point or place of access or entry thereto a sign of prescribed size, contents and form clearly indicating that such place is a prohibited place.’.”.

The Opposition views this matter of prohibited places very seriously. If honorable senators will refer to section 80 of the original Crimes Act they will notice a definition of prohibited places. Paragraph (a) refers to -

Any work of defence, arsenal, factory, dockyard . . belonging to the King or the Commonwealth.

Paragraph (aa) refers to clearly identifiable places such as camps, barracks or places where prisoners of war are detained. Then we come to paragraph (b), which is of particular concern to the Opposition, and to which the first of these amendments is directed. It states that a prohibited place includes -

Any place not belonging to the King or the Commonwealth where any ship, arms, or materials or instruments of use in time of war, or any plans or documents relating thereto, are being made, repaired, or stored, under contract with, or with any person on behalf of, the King or the Commonwealth.

It is obvious that that would relate to any factory where any material of use in the time of war is being stored, fabricated or repaired. It may be that a very small portion only of a large factory is devoted to this purpose, yet the whole factory becomes a prohibited place. It is obvious that hundreds of these places are scattered over most of the cities in Australia. No provision is made for letting persons know what is a prohibited place in the circumstances of paragraph (b). There is no requirement for a proclamation to notify the public and our first amendment is directed to achieve that purpose.

The second of the amendments is directed to achieve a further essential purpose, in the view of the Opposition. All these factories and other places that are prohibited places should have notices plainly exhibited at every point of entry, so that anybody who approaches them, without knowledge of their existence until then, cannot proceed without getting a plain warning. Very grave offences swing upon the point that a person approaches, is in or inspects a prohibited place. To have an undefined and non-specified place is a trap for the unwary, particularly now that the committee has retained the evidential pro vision relating to the known character of the accused. That makes it essential, in the view of the Opposition, that the present definition be widened.

The effect of the two Opposition amendments, Nos. 37 and 38, will be to make these places notifiable by proclamation and to cause proper notices to be exhibited at each entry thereto. In other words, the intention is to give to people who might be charged with committing an offence an opportunity to be on their guard and to avoid such places.

Senator GORTON:
Minister for the Navy · Victoria · LP

– I shall take the second amendment first. I suggest that it is necessary to bear in mind in regard to all these provisions that it must be possible to prove before a judge and jury that there was a prejudicial intent before any crime can be alleged against a person, even though he was in a prohibited place. If the law said that only those places which were placarded at the points of ingress and exit could be regarded as prohibited places, then the places from which we want to exclude the people whom we are seeking to exclude would be advertised in a way in which we would not want them to be advertised.

Senator McKenna:

– These are private places.

Senator GORTON:

– Yes, but there could well be places in the nature of private places which we would not want to announce publicly as places connected with the defence forces or as defence establishments. The point is that the element of intent must be present. This last argument applies also to the question whether a private factory should be proclaimed by the GovernorGeneral before some act committed in it could be triable and punishable under thislegislation.

Amendments negatived.

Clause agreed to.

Clause 54 agreed to.

Clause 55.

Section eighty-two of the Principal Act is. repealed and the following section inserted in itsstead: - “82. - (1.) If a Justice of the Peace is satisfied, by information on oath, that there is reasonable ground for suspecting that an offence against this Part has been, is being or is about to be committed, he may grant a search warrant.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition Amendment No. 39.) Proposed section 82, sub-section (1.), leave out “Justice of the Peace”, insert “Judge or Magistrate”.

Section 82 (1.) is a proposed new section dealing with the issue of search warrants under Part VII. of the act, which relates to espionage and official secrets. The subsection provides for a search warrant to be issued by a justice of the peace if he is satisfied by information on oath that there is reasonable ground for suspecting that an offence has been, is being or is about to be committed. We feel that in matters of this type a search warrant ought to be issued only by a magistrate or a judge, who is far more experienced, qualified and trained in the law. Many justices of the peace have no legal training and no real legal experience. Many of them do not function other than for the purpose of signing declarations and performing the ordinary chores that a justice of the peace performs in his civil capacity.

Senator GORTON:
Minister for the Navy · Victoria · LP

– A justice of the peace is empowered to issue a search warrant under the law of New South Wales and other States. I understand, in fact, that a justice of the peace has always had the power to issue a search warrant. I refer the Senate to sections 354 to 357 of the Crimes Act of New South Wales. It would be a new departure to prescribe that a judge or a magistrate should be the issuing authority. I suggest that this legislation might need to be applied with some speed and that in some cases a justice of the peace would be easily available, whereas a magistrate might not be so easily available. In any case, there has always been authority for a justice of the peace to issue a search warrant. I understand that under New South Wales law a justice of the peace has the power to issue a warrant for arrest.

Amendment negatived.

Clause agreed to.

Clause 56 agreed to.

Clause 57.

Section 84 of the Principal Act is repealed and the following sections are inserted in its stead: -

84.- (1.) . . .

” (5.) No action lies against the Commonwealth or a Commonwealth officer or any other person in respect of any arrest or detention in pursuance of this section, but if the Governor-General is satisfied that an arrest or detention was made without reasonable cause he may award reasonable compensation in respect of the arrest or detention.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 40.) Leave out sub-section (5.) of proposed section 84.

This is an amendment with which the Opposition is particularly concerned.

Proposed new section 84 (1.) provides -

Where a Commonwealth officer has reasonable grounds for suspecting that a person who is in, or in the neighbourhood of, a prohibited place has committed … an offence against this Part, the Commonwealth officer may, without warrant, arrest that person.

A Commonwealth officer is described in clause 4, which amends section 3 of the principal act, in this way -

  1. . a person holding office under, ‘ or employed by, the Commonwealth, and includes -

    1. a person permanently or temporarily employed in the Public Service of the Commonwealth or of a Territory or in, or in connexion with, the Defence Force, or in the service of a public authority under the Commonwealth; and
    2. a Commonwealth police officer.

So, when we talk about a Commonwealth officer having the power to arrest in the circumstances set out in proposed new section 84 (1.), we confer the authority upon a very wide group of persons who are not necessarily police officers. I ask the committee to look at sub-section (5.) of proposed new section 84, which provides -

No action lies against the Commonwealth or a Commonwealth officer or any other person in respect of any arrest or detention in pursuance of this section, but if the Governor-General is satisfied that an arrest or detention was made without reasonable cause he may award reasonable compensation in respect of the arrest or detention.

I should say that that provision expressly negatives the normal right of a citizen to an action for damages for wrongful arrest. It is extraordinary that that right should be so expressly negatived in favour of that extraordinarily wide classification of people who come within the definition of a Commonwealth officer.

The provision which we are discussing really opens the way to a great deal of abuse. It is no answer to say that, if a wrongful arrest is made with very serious consequences to the person arrested, the Commonwealth officer and the Commonwealth are excluded from liability and that the Executive Council may, in its discretion, grant, or the Attorney-General - it might even be boiled down to that extent - may, in his discretion, grant whatever compensation he thinks fit. I repeat that this provision is a complete negation of the rights of individuals. It should never have been in the original bill and should now be excised from it.

Senator GORTON:
Minister for the Navy · Victoria · LP

– I point out that the provisions contained in proposed new section 84 were in the original act without the safeguards with which the bill now seeks to hedge them around. Previously, there was no requirement that a person so arrested could not be held for longer than 24 hours before a charge was laid against him. Previously, there was no requirement that the arresting officer must have reasonable grounds for suspecting that the person arrested had committed or was about to commit an offence. It will now be necessary for the arresting officer to have reasonable grounds. If he acts on reasonable grounds, that is if he acts in pursuance of this section, he is free from action should the charge laid against the person arrested fail, or in any case unless the GovernorGeneral decides otherwise.

I am told that a person would not lose his ordinary common law right of action in the case of an obviously malicious arrest - an arrest which was not in pursuance of this section because it was not based on reasonable grounds. There is some slight advantage in providing for the Governor-General to be able to make payments in cases where an arrested person does not have common law grounds to prosecute because the action of the officer was taken unreasonably. It affords an easier procedure for paying compensation than would be the case in paying it through the Treasury as an act of grace.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I wish to make a very brief comment upon what the Minister has said. I should say that any arrest or imprisonment, whether malicious or not, should be actionable, but subsection (5.) of proposed new section 84 negates the arrested person’s right, whether the action taken was malicious or not. An action for malicious prosecution can arise only if the matter is got before a court. We are talking here not about proceedings in which a malicious prosecution can arise but about an arrest under the proposed new section. We are not concerned about malicious prosecution at all.

Senator Wright:

– The Minister referred to the phrase “ in pursuance of this section “ in sub-section (5.) as distinct from the term “ in purported pursuance of this section “.

Senator Gorton:

– I am told that an action for false arrest would lie in the case you have just been discussing.

Senator McKENNA:

– There would be an action for false imprisonment, which is now negated by sub-section (5.).

Senator Gorton:

– If the arresting officer had no reasonable grounds for the arrest, he would not be acting in pursuance of this section, and an action for false or wrongful arrest would therefore lie. At least, I am so advised.

Senator McKENNA:

– Sub-section (5.) reads -

No action lies against the Commonwealth or a Commonwealth officer or any other person in respect of any arrest or detention in pursuance of this section, but if the Governor-General is satisfied that an arrest or detention was made without reasonable cause-

Senator Wright:

– That is not the same as having reasonable grounds for arresting.

Senator McKENNA:

– No. The subsection continues - he may award reasonable compensation in respect of ‘he arrest or detention.

So, when the honorable senator directs my attention to the words “ in pursuance of this section “, I go back to sub-section (1 .). The next few words in sub-section (5.) seem to take the matter quite out of that category.

Senator Gorton:

– No.

Senator Vincent:

– Surely it is governed by the first expression.

Senator GORTON:
Minister for the Navy · Victoria · LP

– I should imagine that the officer making the arrest has to act in pursuance of the section, which provides that he must have reasonable grounds. If a person were arrested without reasonable grounds and if he brought an action which was decided in his favour, he would make good his action for wrongful arrest. On the other hand, there may well be cases in which persons were arrested on grounds which a court regarded as being reasonable or which it would be very difficult to prove were not reasonable. In that case, the Governor-General could decide that there were not reasonable grounds, despite the fact that the matter had not been taken to court.

Amendment negatived.

Clause agreed to.

Clause 58 agreed to.

Clause 59.

Section eighty-six of the Principal Act is repealed and the following sections are inserted in its stead: - “ 86. - (1.) A person who conspires with another person -

  1. to commit an offence against a law of the Commonwealth;
  2. to prevent or defeat the execution or enforcement of a law of the Commonwealth;
Senator McKENNA:
Leader of the Opposition · Tasmania

– I move - (Opposition amendment No. 41.) Proposed section 86, sub-section (1.), at the end of paragraph

  1. insert “ other than an award, agreement, determination or order made pursuant to the Conciliation and Arbitration Act 1904-1960 or to the Public Service Arbitration Act 1920-1960 or pursuant to any other Act regulating conditions of employment in an industry “.

The purpose of this amendment is to carry out the idea that the Attorney-General had in mind when he said that the act was not aimed at bona fide trade union activity. Proposed new section 86 (1) (b) provides that a person who conspires with another person to prevent or defeat the execution or enforecement of a law of the Commonwealth shall be guilty of an indictable offence. The argument may be advanced that an award of the Commonwealth Conciliation and Arbitration Commission is not a law of the Commonwealth, but I consider such an argument to be a purely technical one.

The purpose of the amendment that I have moved on behalf of the Opposition is to exempt from the operation of the clause an award, agreement, determination or order made pursuant to the Conciliation and Arbitration Act 1904-1960, or to the Public Service Arbitration Act 1920-1960, or pursuant to any other act regulating conditions of employment in an industry. It is so very easy, when men come together to take industrial action, for them to be charged with conspiracy. The trade union movement is particularly concerned about this matter and I think that the Government should accept the amendment. If it does so, it will make doubly clear what the Attorney-General says is already clear. After all, he has made his meaning doubly clear by including an exemption in another clause.

Senator GORTON:
Minister for the Navy · Victoria · LP

– I think that once again the gravamen of the matter is whether people are conspiring with an intent to break a law, with whatever subject it may be concerned, or for nefarious purposes such as those referred to in the bill. If they are so conspiring and if their intent can be proved before a judge and jury, it does not seem necessary to have a limitation in the provision, because nobody who was acting properly would so conspire.

Amendment negatived.

Clause agreed to.

Clauses 60 to 63 agreed to.

The Schedule agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 2185

CUSTOMS TARIFF BILL (No. 4) 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henry) read a first time.

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– I move -

That the bill be now read a second time.

Mr. President, the bill now before honorable senators proposes amendments of the schedule to the Customs Tariff 1933-1960. With one exception, to which I will refer later, the Tariff changes arise from the Government’s consideration of five Tariff Board reports which have already been tabled in this chamber.

The first schedule to the bill deals with the alterations in respect of furnishing fabrics which have operated from 28th October, 1960. The changes proposed are based on the board’s findings and, stated simply, make man-made fibre furnishing fabrics dutiable at the same rates of duty applying to man-made fibre piece goods generally; that is to say, 2s. 6d. per square yard British preferential tariff and 2s. 8id. per square yard most-favoured-nation, while woollen moquettes take duties closely approximating those applicable to woollen piece goods generally. Other furnishing fabrics, wholly of cotton or wholly of linen or other admixed fibres, become dutiable at rates of 37± per cent. British preferential tariff and 50 per cent, most-favoured-nation.

The changes in the level of protection mean a slight increase on woollen moquettes and a reduction in the duty applicable to heavier man-made fibre fabrics. Following representations by the furnishing fabrics manufacturers that there has been a recent trend towards the importation of the heavier man-made fibre fabrics and that the level of protection on these goods was now inadequate, my colleague, the Minister for Trade (Mr. McEwen), has again referred this question to a deputy chairman of the Tariff Board for advice as to whether emergency action by the imposition of a temporary duty under the new provisions recently enacted by the Parliament is justified.

The amendments proposed by the second schedule are based1 on reports by the Tariff Board on - travel goods, chlorination regulators and controllers and voltage regulators. On travel goods and various other bags, cases and the like, the Tariff Board has recommended rationalized duties with little overall change in the level of protection. This has made possible the introduction of simplified Tariff structure on these goods. The new rates of duty are 15 per cent. British preferential tariff and 32i per cent, otherwise for baskets, and 17i per cent. British preferential tariff and 45 per cent, most-favoured-nation for the other goods covered by the Tariff Board’s recommendation.

The Government has decided not to adopt the board’s recommendation for protective duties on imported chlorination regulators and controllers. The proposal, therefore, merely introduces a new item which will have the effect of continuing the present non-protective tariff on these goods. The rates of duty are free British preferential tariff and 7i per cent, otherwise.

Protective duties, as recommended by the Tariff Board, are now provided for two unit type voltage regulators suitable for 6 volt and 12 volt systems, when they are to be used for replacements in motor vehicles. The new rates, which already apply to three unit type voltage regulators, are 27£ per cent, under the British preferential tariff and 40 per cent, under the mostfavourednation tariff. No change is proposed for these goods when for use as original equipment in motor vehicles.

The other amendment which I have mentioned and which is not associated with a report of the Tariff Board, concerns importations by a Government of an overseas country pursuant to an agreement made with the Commonwealth. The goods are for official use and are not for purposes of trade and, consequently, should be admitted without liability as to import duty. There is no provision in the customs tariff to cover these goods and the Government has decided to insert a by-law item which could be used when required for such imports.

The third schedule to the bill gives effect to the Tariff Board’s recommendation in its report on unwrought copper, that some increase be made in the tariff protection now given to local industry. At present, no duty is payable on unwrought copper when the determined price of copper, which is based on the world price, is £275 Australian or more per ton. When the determined price falls below £275, duty is payable at the rate of £1 per ton for each £1 by which the determined price is less than £275 Australian per ton.

As from 3rd January, 1961, the price level at which unwrought copper becomes free of duty will be raised from £275 to £290 Australian. With the current price of copper in the vicinity of £289 per ton, the duty payable would be about £1 per ton. This action is complementary to that proposed in the Copper Bounty Bill which is. now before the Senate. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2187

CUSTOMS TARIFF (NEW ZEALAND PREFERENCE) BILL (No. 3)1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henty) read a first time.

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– I move -

That the bill be now read a second time.

The amendments proposed by the first and second schedules to this bill are complementary to those in Customs Tariff (No. 4) Bill 1960 relating to moquettes with uncut woollen pile and to bags, cases and similar containers.

The New Zealand preferential rates which have applied to these goods when of New Zealand origin are now being removed and the goods will now become entitled to British Preferential Tariff treatment. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2187

COPPER BOUNTY BILL (No. 2) 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henty) read a first time.

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– I move -

That the bill be now read a second time.

In 1958 this Parliament passed a bill authorizing the payment of bounty on copper produced in Australia from indigenous materials and sold for use in Australia. Under the provisions of the Copper Bounty Act 1958, bounty was paid on refined copper sold during the period 19th May, 1958, to 30th June, 1960. Prior to the expiration of the bounty period the Government directed the Tariff Board to re-examine the question whether, having due regard to the importance of copper production both to the national economy and to the economies of several substantial isolated communities, assistance should be accorded the production in Australia of unwrought copper and, if so found, the nature and extent of such assistance. Following completion of inquiry the board delivered its report on 20th May, 1960. As it was not possible to make a detailed examination of the board’s report in the limited time available before the expiry date, the act was extended to 31st December, 1960.

The present act, in conjunction with the Customs Tariff, provides assistance to the industryby a combination of bounty and duty. Duty is levied when the overseas price of copper falls below £275 per ton. Subject to a profit limitation of 10 per cent. on capital involved, bounty is payable with a maximum rate of £45 per ton on refined copper, produced and sold for use in Australia. The assistance by way of bounty and duty gives producers a return of about £335 per ton.

The Tariff Board’s report of 20th May, 1960, has already been tabled. The board considers that assistance will still be required after the expiry of the present act and has recommended the continuance of the present duty-cum-bounty arrangements, but with revised rates. It has proposed that the duty should operate when the overseas price falls below £290 per ton and that bounty rates be prescribed with a maximum of £35 per ton based on the overseas price of £290 per ton or less. The Government considered the report and has decided to adopt, in general, the board’s recommendations.

A resolution to move an amendment to Tariff Item 137, to alter the cut-off point for duty purposes from £275 to £290, as recommendation by the board, was recently introduced in the Parliament. This amendment will operate from the commencement of business in 1961 to correspond with the operating date of the new bounty rates.

The proposed revision in the duty cutoff point and the bounty rate has become necessary because of the changed circumstances in the industry since the present act was passed. The effect of the new legislation will be to give producers an increase of £5 per ton in their return from copper sold for use in Australia. However, as it is expected that bounty recipients will be exporting greater proportions of their output than in the past, it follows that their overall returns on copper produced in Australia may be somewhat less than at present.

There are certain other minor changes provided by the bill designed to facilitate operation of the bounty. In considering the Tariff Board’s recommendation that the bounty be extended for a further five years with review of the rates payable in three years the Government has taken the view that the changing situation in the industry warrants a review both in the form and level of assistance in three years. Before expiry of the bounty period the Government will give careful consideration to its policy of protection to the industry and will then direct the Tariff Board to make a further review of the industry. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2188

SULPHURIC ACID BOUNTY BILL (No. 2) 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henty) read a first time.

Second Reading

Senator HENTY (Tasmania - Minister for

Customs and Excise) [12.57 a.m.].- I move -

That the bill be now read a second time.

This bill is designed to extend the sulphuric acid bounty for a further period of five years from 1st July, 1960. Honorable senators will recall that the Government has for some years encouraged the production in Aus- tralia of sulphuric acid from indigenous materials, notably iron pyrites. Since 1954 a bounty has been payable to acid producers using iron pyrites, and in 1957 the bounty was extended to cover sulphuric acid made from lead sinter gas. The object of the bounty was to compensate the producers for the extra costs incurred in using these materials as compared with imported brimstone.

In May, 1959, the Government decided that, in view of the considerable improvement in the supply position overseas for brimstone, it was economically unsound to continue the policy of encouragement of production from indigenous materials. It then asked the Tariff Board to recommend a bounty which, while not conflicting with the decision to abandon the encouragement policy, would have regard to the Government’s obligations to those producers who had co-operated with it in that policy.

The board delivered its report on 20th June, 1960. The bounty payable in terms of the act then current was due to end on 30th June, 1960. It was then extended for a further period of six months, to 31st December, 1960, to allow time for a study of the board’s report.

The board has recommended, in effect -

An extension of the bounty for another 5 years;

Separate bounties for iron pyrites and sulphuric acid made from it; and

That no bounty be paid on acid made from lead sinter gas.

It proposed alternative bounty rates of £3 or £5 4s. a ton of sulphuric acid, either of which could be adopted by the Government in the light of what it considered to be its obligations to the producers. The lower rate measured the average cost disability of producers, and the higher rate the disability of the highest-cost producer. Similarly, alternative rates were proposed for iron pyrites, with the same criteria in mind. The board’s report was tabled on 30th November, 1960.

This bill will give effect to the board’s recommendations for sulphuric acid, and a bill to implement the proposals for iron pyrites will be submitted for the consideration of honorable senators in a few minutes’ time.

The Government has decided on the lower of the two rates suggested by the board, that is, the rate which is based on the average disability of producers. The higher rate, based on the disability of the highest-cost producer, has been rejected, as even when the Government’s policy was to encourage production the bounty was based on average disability.

The new bounty rate is not specified in the bill, but it will be prescribed in the regulations, to operate on and from 1st January, 1961.

The payment of bounty on sulphuric acid produced from lead sinter gas is to be discontinued because the board has reported that the only producer from lead sinter gas is under no cost disability through the use of that material compared with the use of brimstone.

The bill is designed to limit bounty payments to those producers to whom the Government recognizes an obligation. The only bounty recipients will be those producers who were producing sulphuric acid from indigenous materials before the introduction of this Bill into the House of Representatives on 1st December, 1960. Others who before that date may have incurred substantial commitments to commence production will be allowed a period of six months in which to apply for consideration as bounty claimants in the future.

The rate of profit limitation is unchanged at 12½% of the capital employed in the production and sale of the acid. This rate has applied since the bounty was introduced in 1954. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2189

PYRITES BOUNTY BILL 1960

Bill received from the House of Representatives.

Standing Orders suspended.

Bill (on motion by Senator Henry) read a first time.

Second Reading

Senator HENTY:
Minister for Customs and Excise · Tasmania · LP

– I move -

That the bill be now read a second time.

I referred to this bill a few minutes ago, in my speech introducing the Sulphuric Acid Bounty Bill into this chamber. This bill is designed to put into effect the Government’s plan to pay a bounty on iron pyrites, as a part of its policy of assistance to those producers who have co-operated with it in the production of sulphuric acid from indigenous materials. The bill follows closely the recommendations of the Tariff Board in its report dated 20th June, 1960 on the Sulphuric Acid Bounty Act 1954-1959. The report was tabled on 30th November, 1960.

The board has recommended a basic rate of either £3 or £7 a ton, to be increased or decreased by the same amount, to the nearest1s., as the landed cost per ton of brimstone falls below or rises above £16. The two alternative basic rates are related respectively to the average cost disability and the disability of the highest-cost producer. The price adjustment provision recognizes the fact that the cost disabilities of the iron pyrites producers vary with the cost of imported brimstone. The Government has adopted the lower basic rate, subject to the adjustment clause suggested by the board.

The only recipients of bounty will be producers to whom the Government recognizes an obligation, that is, those who were in operation before the introduction of this bill into the House of Representatives on 1st December, 1960.

The rate of profit limitation, at 12½ per cent., is the same as has been provided for sulphuric acid since the bounty was first paid in 1954, and will be provided for sulphuric acid under the Sulphuric Acid Bounty Bill (No. 2) 1960. I commend the bill to honorable senators.

Debate (on motion by Senator Kennelly) adjourned.

page 2189

POST AND TELEGRAPH BILL 1960

Second Reading

Debate resumed from 29th November (vide page 1800), on motion by Senator Spooner -

That the bill be now read a second time.

Senator BENN:
Queensland

– In 1939, legislation was introduced to make available concessional post and telegraph rates to servicemen, and since that time the members of the forces have appreciated the concessions.

This bill amends the concessions in such a way that some servicemen will be deprived of them entirely and the remainder will be granted only a portion of the existing concessional rates in respect of postage and the use of the telephone and telegraph services. I ask honorable senators to consider whether this is the right time to introduce this form of legislation. We have been told repeatedly during the past week that Australia was never in a wealthier condition than at the present time. We have been told on many occasions that here is a stratum of prosperity spreading all over the Commonwealth and that the people are enjoying that prosperity, but by this bill the Government seeks to take the concessions from some of the servicemen entirely and to reduce the concessions applicable to others. 1 look at the situation broadly. If in 1960 the Government takes away or reduces the whole of the concessions that were granted in 1939, in effect it is bringing about a reduction of the rates of pay of servicemen.

I recall, because of certain activities in which I am engaged here as a member of this Senate, that it was only towards the end of last year that the rates of pay of servicemen were increased. The increases became operative from early this year. I believe that these concessions were taken into account when the rates of pay of servicemen were decided. We have been told by the Minister for National Development (Senator Spooner), who introduced the bill, that the Defence Committee examined the submissions and recommended to the Government that they be treated in the way in which the Government proposes to deal with them in this bill.

Let us have a look at the situation. I repeat that the concessions have been in operation since 1939. In the warp and woof of industrial action, in the fixing of rates of pay such a thing as custom is considered. I say that over the years every time there has been an increase of the rates of pay of servicemen these concessions, which amount to a large sum annually, must have been given full consideration. I know that it is the Executive Government which approves increases of the rates of pay of servicemen, but the Executive Government would have complete advice before it when taking action to increase their rates of pay. The factor of custom should not be removed from consideration in the fixation of the rates of pay of servicemen.

I concede, and the Minister will not deny, that the concession amounts to a substantial sum annually. Therefore, as this is not a trivial matter, we should not deal with it lightly. Actually, by this bill, the Government is reducing the rates of pay of servicemen.

Senator Hannaford:

– How much does the concession amount to?

Senator BENN:

– If senator Hannaford refers to the Estimates, he will find that the concession amounts to about £250,000 a year. The annual vote for the defence of Australia is about £200,000,000. If we passed this subject like a man on a galloping horse we might ask, “ What is £250,000 in comparison with a vote of £200, 000,000”? But that is not the point. Servicemen are away from their homes. They need to communicate with their wives and members of their families, who send letters and parcels to them. It is necessary to have a good relationship between employer and employee. Servicemen are employees of the Government, which proposes to take away some of their concessions and to reduce others. Will that establish a good relationship? Perhaps the Government believes that it can afford to disregard the goodwill of servicemen, but I do not think that it is wise to do so. We have a good body of concientious servicemen now and they should be kept that way. An amount of between £250,000 and £300,000 is a small amount to pay for the goodwill of all our servicemen.

If it is said that the Department of Defence made a recommendation on the matter to the Government let me point out that another committee investigated the rates of pay of servicemen and that the Government, acting upon that committee’s recommendation, made substantial increases in rates of pay. In fixing the new rates, consideration must have been given to the concessions enjoyed since 1949.

Senator Mattner:

– What committee recommended increased rates of pay for the troops?

Senator BENN:

– The Allison committee. For the reasons 1 have outlined, the Opposition opposes the bill.

Senator KENNELLY:
Victoria

– I endorse everything that Senator Benn has said. The total cost of all the concesions of this kind is about £288,000. The cost of those being retained - those for servicemen overseas - is £25,000, so the saving will be £263,000. Why does the Government want to break a contract? It spends a considerable amount of money on recruitment. In 1959-60, expenditure for this purpose amounted to £301,492, and the amount provided for 1960-61 is £486,000. I cannot say that I altogether agree with the policy of the public relations officer who spends a lot of this money. We see advertisements telling prospective recruits that as soldiers they can go around the world. Others say that everybody loves a sailor. I do not know the public relations officer, but he is very lucky that he is not working for me. Another advertisement invites people who want to play a drum, or otherwise embark upon a musical career, to join the Army. Excellent opportunities are promised to good men, but this applies in all walks of life. The latest advertisement that I have seen states that a soldier can save easily, can travel around Australia, can increase his education and trade skill, and can have two years’ overseas tour of duty.

The Government has entered into a contract with these servicemen. It has spent large sums of money to encourage them to join the Services. If this bill becomes effective, everyone in the Services will have a grievance. A person joins under certain conditions. He expects his pay to increase as inflation takes the value out of money. He knows the conditions and he is entitled to get them. We must have contented Services. I know that in peacetime many people say that nothing should be spent on defence. I am not one of those persons. I think that the Government spends an excessive amount, but I certainly want some provision for defence. We must have a skeleton force which can train other men in the event of trouble. When we are at peace, we do not tie up all the naval vessels, although I admit that we have not many. The Government continues to spend millions of pounds on the Royal Australian Air Force. For a long time it has been considering various types of replacement aircraft. Let us hope that the consideration will come to an end soon.

The men in the Services are prepared to stand between us and danger. What is an amount of £263,000 in a total of £200,000,000? I regret that the Government has taken this step. My colleague, the honorable member for Bendigo (Mr. Beaton), who is new to politics, referred in another place to an Army survey unit, the head-quarters of which is at Bendigo but which travels around, mapping the State for roads and other purposes. The members of that unit need to use the postal and telephone services to communicate with their families. We are not short of money internally, although we are a little worried about our external credits. This will always be the case, as these credits fluctuate. At the moment, we are in the trough. Let us hope that before the Parliament resumes next year we shall be, if not on the crest of the wave, at least going in that direction.

The Government, having enlisted men on certain conditions, should not break its contract. It must be quite difficult to get recruits. The amount spent on recruitment this year will be £486,000, but only a handful of recruits wll be obtained. I do not want to go into a long discourse at this hour, but I think that the Government’s proposal is wrong. I think the Government is doing something which will react against it. It is not enticing people to join the Services; and honorable members know that if war came to-morrow, to entice people to join the Services we would not worry if recruits spent perhaps six weeks at Broadmeadows or Puckapunyal in Victoria or at Liverpool in New South Wales. We are not broke, and the cost of this concession will not affect us very much. We are not attracting young men who might want to join the Services and make service life a career. If we did not have any such people to-day we would be hard pushed if real trouble came. I ask the Government, even at this late hour, not to push this measure through, but to have another look at it.

I owe the Army a great deal. I have never gone to the Army for any material such as pontoons or anything of that sort and met with a refusal. The Army is always willing to give something to help the people, and 1 have no doubt that the same would apply to the other Services if they were approached. I ask the Minister to have another look at this legislation; and my main theme is “ Do not break the contract “.

Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP

– in reply - It is never a pleasant matter to remove a concession, particularly when it has been in operation for a considerable period of time. The real test is to consider whether the concession is an equitable and fair expenditure of Government funds. This concession was given long years ago when conditions were very different from what they are to-day. Conditions in the Services have improved very materially indeed. Rates of pay and allowances are now on a vastly different scale from those at the time when this concession was granted. We must remember, also, that this concession was granted materially to those under active service conditions, and it still applies, to an appreciable extent, to those on active service. This is part of the defence vote, and the recommendation that the change should be made came from the Defence Services.

I do not accept the suggestion that this measure will impair the goodwill between the men in the Services and their responsible officers. I do not accept the position that it is a breach of contract. It is a variation of an arrangement. The terms and pay are set out in Army regulations, and to my recollection there is in them no reference to this concession. As I say, we have to use our resources to the best advantage, and in an equitable way. There is no justification for giving these particular concessions, in the present circumstances, to those who are now receiving them. There is a responsibility on those administering the Defence Services to get the best use from the funds made available to them. In their opinion this use of the funds is not justified under the changed conditions, and it is on those grounds that the Government believes the measure should be passed.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator KENNELLY:
Victoria

– The Minister says the Defence Department believes that this money ought to be spent more effectively. What about the millions of pounds spent on H.M.A.S. “ Hobart “ which was then put into moth balls without going to sea at all; or the £9,000,000 which the Public Accounts Committee or the Auditor-General found was paid from one of the services to the Army? I do not say that men wilfully waste the Crown’s money, but I think the sum of £263,000 pales into insignificance in comparison with the sums I have mentioned. With great respect to the Minister - and, I hope, in very calm tone - I ask him not to do this. I say it is a breach of contract. If I had enlisted in the services I would have known what the rates of pay were. It is true that the rates of pay have increased, but that does not answer the question. The only thing that matters is what you can purchase wilh the money you get to-day. The Minister might have had a case if he had said that postage was so much in 1939 and that service personnel had to pay a certain percentage of it - whether in Australia or abroad - and if they had to pay only 50 per cent, of the postage rate in 1939 they should receive the same concession now. The money received by members of the armed services to-day will not buy more bread, butter or milk than it bought in years gone by; and it certainly buys less beer or cigarettes to-day than it bought in 1939. That is the only way in which you can measure money.

If the Government said that service personnel had to pay half postage rate in 1939 and would therefore have to pay 2id., or half of the present 5d. rate to-day, no one could object. Fortunately this country is at peace. We, on this side of the committee, have always been accused of not wanting the services, in peace or war, but of course we have never accepted that. The nien at Bendigo, whom 1 mentioned, are sent all over the place. Surely we do not want only single men in the Army, and many service personnel do not want to remain single. 1 regret that the Minister has taken up the stand he has. 1 do not think he has the strongest of cases. Had he said that the same principle as that applied in 1939 should apply to service personnel in Australia, while leaving those abroad as they are, 1 would not have objected. After all, service personnel serving abroad to-day are, fortunately, serving in areas where there is extremely little danger. They are away in other countries where the climatic conditions may be uncomfortable, but there is no danger. If the Government is to spend a large amount of money on recruitment, I hope that those in charge of the publicity will think out some new slogans and have them made known. I want the forces to get the number of recruits the Government requires. However, I say that the Minister’s case was not strong. To be honest, I suppose that if I were in his place I would do what he has done; but I do not think he has a strong case.

Senator Kendall:

– Why should people in the Services get cheaper postage rates than people in any other walk of life in peacetime?

Senator KENNELLY:

– All I say in reply to Senator Kendall is that a Liberal government gave servicemen a cheaper rate than the ordinary rate in 1939, and whether it is 1939 or 1960, what is the difference in the principle?

Senator Kendall:

– There happened to be a war on.

Senator KENNELLY:

– Is that the reasoning? When these people are in danger, when they have to stand between us and invaders, or have to keep the invaders out, the Government is prepared to give them a concession. But this is peace-time and the whole position, therefore, is different! I think I have given the answers.

Senator Anderson:

– The rates of pay were altogether different.

Senator KENNELLY:

– With the greatest respect to Senator Anderson, who has served in the forces, I say that he knows that the rates of pay to-day would not buy any more than they would in 1939, rank for rank.

Senator Anderson:

– Of course they would. Be sensible.

Senator KENNELLY:

– It is all right for you to say that. If the present rates of pay are better, the Liberal Government made the rates what they were in 1939. So, if the honorable senators opposite say that they wanted soldiers, sailors and airmen on the cheap, they should not blame any one else. I am only trying to relate 1960 to 1939. If the Government had related increases in postage to increases in wages from 1939 to 1960, the Government could argue its way out of it. I say without offence and with great respect that it seems to me that the Government’s attitude is that whatever happens on one day, things will always be a bit calmer on the next. Speaking quite candidly, I say that it seems to me that the Government wants servicemen on the cheap now, and I very much regret that this bill has been introduced.

Bill agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

Senate adjourned at 1.34 a.m. (Thursday).

Cite as: Australia, Senate, Debates, 7 December 1960, viewed 22 October 2017, <http://historichansard.net/senate/1960/19601207_senate_23_s18/>.

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