Senate
1 August 1945

17th Parliament · 3rd Session



The President (Senator the Hon. Gordon Brown) took the chair at 3 pan., and read prayers.

page 4781

QUESTION

RATIONING

Special Issue of Sugar - Adminis tra une Activities - Clothing Supplies.

Senator COOPER:
QUEENSLAND

asked the Minister for Trade and Customs, upon notice -

In view of the availability of oranges for making marmalade jam, will the Minister consider the early release of a special sugar ration of 6 lb., similar to that made last year.

Senator KEANE:
Minister for Trade and Customs · VICTORIA · ALP

– The question of special sugar releases for domestic jammaking is constantly under review. Recently great difficulty has been experienced, particularly in New South “Wales and Victoria, in maintaining the normal civilian ration. In Victoria as a result of an industrial dispute, many weeks’ production of refined sugar was lost. In New South “Wales, a sudden very heavy service export order which had to he met temporarily placed that State’s stock of refined sugar in a very precarious posi- tion. As soon as normal stocks of refined sugar are built up at refineries in those’ two States, consideration will be given to releasing a special jam issue.

Senator ARNOLD:
through Senator Large

asked the Minister for Trade and Customs, upon notice -

  1. Does the Minister know that complaints have been made of delays in the office of the Deputy Director of Rationing, Sydney, in handling day-to-day business; and, if so, does he consider such complaints justified!
  2. Can he give me some figures showing the volume of business transacted in that office on an avenge full working day I
Senator KEANE:

– The answer to the honorable senator’s questions are as follows : -

  1. Such complaints have been received, but, taking all the circumstances into account (particularly the large volume of work as shown by the answer to paragraph 2 of the honorable senator’s question), I do not consider ths.t they are justified.
  2. The following statement would fairly represent the work handled on an average full day: -
Senator COOPER:

asked the Minister for -Trade and Customs’, upon notice -

  1. Has the. Minister seen the press report* from Brisbane, published- in the Sydney Morning Herald of the 21st July, to the effect that, unless man-power and other authorities act quickly, the 00,000 men about to be released from the services will find themselves getting round in a makeshift of civilian and army clothing?
  2. In view of the claim made in the reports that hats and shirts are unprocurable and that tailors cannot cope with any big demand for suits, will he order an immediate inquiry into the clothing position in Queensland;
  3. Will he ascertain if large quantities of shirting are held by the Division of Import Procurement, and, if so? will he arrange for the release of a quantity to Queensland, and confer with the various- Commonwealth authorities concerned with a view to rectifying the conditions referred to?
Senator KEANE:

– The answers to the honorable senator’s questions- are as follows : -

  1. Yes.
  2. The clothing position in all States is continually under review. Clothing is being manufactured to the full extent of man-power and materials available. -However, the reports will be referred to the Minister for Supply and Shipping, whose department is the responsible authority for the provision of clothing for discharged service personnel.
  3. Sufficient shirting for the making-up capacity available has been released to quota holders by the Division of Impart Procurement and further substantial quantities are now in process of distribution. Queensland traders have not been able to take up the full quantities of shirting material offered to them.

page 4782

QUESTION

HOUSING

Compulsory Acquisition or Land

Senator BRAND:
VICTORIA

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

With reference to regulation ISA of the War Service Moratorium -Regulations, will the Attorney-General state whether be will consider the revocation of his approval to the Victorian Housing Commissions compulsory acquisition of building blocks of land owned by members of the fighting services, many of whom are still overseas and even prisoners of war?-

Senator KEANE:
ALP

– The matter is of importance and is receiving the personal consideration of the Attorney-General.

“WHEAT INDUSTRY.

Stocks - Wheat fob Stock Feed.

Senator MATTNER:
SOUTH AUSTRALIA

asked the Minister representing the. Minister for Commerce and Agriculture, upon notice -

  1. What amount of wheat in Australia was held by the Australian Wheat Board on 1st July, 1945, or’ nearest convenient date!
  2. How much wheat will be made available for distribution as feed wheat to each State during July and August of this year?
  3. What are the factors considered . when arriving at a basis on which allocations of wheat as stock feed are made to each State?
Senator KEANE:

– The Minister for Commerce and Agriculture has supplied the following answers: -

  1. 41,000,000 bushels.
  2. The wheat available- for distribution a: feed wheat in the various States during July and August is as follows: -
  3. The allocations to the various States were based on their respective sales for the first nine months of 1044 which was considered to be a representative period for this purpose. Adjustments in these figures were made as considered necessary after the incidence of the drought conditions on demands for feed wheat in the various States had been taken into consideration.

page 4783

QUESTION

SALES OF MOTOR VEHICLES

Senator COOPER:

asked the Minister for Trade and Customs, upon notice -

  1. Has the Minister’s attention been drawn to a statement in the Sydney Sunday Sun of the 22nd July, by Mr. J. Wool te, of Newcastle, made at a meeting of the New South Wales Motor Traders Association, to the effect that regulations governing the motor trade had forced some members to become semiblackmarketeers because the Government had not allowed the legitimate trader one penny profit on the sale of cars, while ordinary people could sell their cars at the pegged price?
  2. If bo, is it a fact that the alleged discrimination exists, and will he state whether the Government intends to remedy the position in the interests of legitimate traders?
Senator KEANE:
ALP

– The answers to the honorable senator’s questions are as follows: -

  1. Yes.
  2. There is no discrimination. The demand for used vehicles is at present so great that owners are able to obtain the full maximum price without selling through dealers. As the dealer is also limited to the full maximum price he must purchase at a lower price if he wishes to make a profit. It is not proposed to vary the pre-war practice under which any person was free to sell his motor vehicle privately.

page 4783

QUESTION

YOUNG WOMEN’S CHRISTIAN ASSOCIATION

Travel Permits

Senator COLLETT:
WESTERN AUSTRALIA

asked the Minister representing the Prime Minister, upon notice -

  1. Is is a fact (a)’ that thirteen women of Western Australia recently offered their services as Young Women’s Christian Association workers in the hostels and convalescent depots in the Smith-East Asia and Middle East Commands; (6) that these offers were accepted by the appropriate British authorities; (c) that permission to proceed was accorded by the Department of the Army and the Department of Labour and National Service, and passports granted and issued?
  2. Is is a fact that permission to proceed abroad was subsequently withdrawn?
  3. If so, by whose direction, and for what reason, was the permission withdrawn?
Senator KEANE:
ALP

– The Prime Minister has supplied the following answers : - 1. (a) and (6) Yes, except that the thirteen women referred to were from various States, only three being resident in Western Australia; (c) the departments referred to indicated that they offered no objection to the proposed departure of these women. They had no authority to grant permission. Pass ports were prepared in favour of some of the women in anticipation that approval would be given. 2 and 3. With the exception of one of these women, who was an American citizen, the issue of passport facilities was withheld in accordance with a decision of the Government placing a ban on the grant of such facilities (except in very special circumstances) to Australians to enable them to proceed for service abroad. The Government’s decision is related to the extreme shortage of man-power and, woman-power for essential services in Australia at the present time.

page 4783

SPECIAL ANNUITY BILL 1945

Bill received from the House of Representatives

Standing and Sessional Orders suspended.

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

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That the bill be now read a second time.

This bill is designed to provide out of Consolidated Revenue an annuity to the widow of the late Prime Minister, the Eight Honourable John Curtin, at the rate of £500 per annum. It will be observed that the annuity is to be paid in monthly instalments. Provision is made for the cessation of the annuity in the event of the widowhood being terminated by remarriage.

The late Prime Minister represented the electoral division of Fremantle from 1928 to 1931 and from 1934 until the time of his death. He was Leader of the Opposition in the House -of Representatives from October, 1935, until October, 1941, when as assumed the offices of Prime Minister and Minister for Defence. He came to this high and responsible office at the most critical period in the history of Australia. The Allied Forces with which Australian Forces were associated, had been fighting valiantly in Europe and on the sea and in the air to withstand their foes, whose deliberate plans to dominate the world were meeting with some success. Japan was a potential menace, but had not yet declared its intentions. However, only two months later Japan struck without warning and began its onward rush until some of our island territories adjacent to Australia were captured, thousands of our soldiers had been made prisoners, and our continent had been bombed. Such was the situation which faced the late Prime Minister shortly after assuming office. There was then the gravest danger that our continent would be invaded by a cruel and barbarous foe. At this fateful hour, the Government was constantly faced with critical national situations and momentous decisions had to be made almost daily. The late Prime Minister devoted his great talents and energies unsparingly towards mobilizing and directing our resources to ensure that our land should remain inviolate. I know that all honorable senators will join with. me when I pay tribute to the outstanding leadership which the late Mr. Curtin gave to this country in those dark days, and which he continued to give during nearly four years until, happily, before his death, the enemy in Europe had been defeated, and in the Pacific, danger had been removed and victory was no longer in doubt. The enormous volume of work arising out of the war, and the great responsibility which the late Prime Minister had to shoulder, undoubtedly made serious inroads upon his health. Even after making vital decisions involving the employment of members of the forces, or .their transport in dangerous waters, the late Prime Minister’s thoughts constantly turned to them and who knows what he endured in his quiet hours? It will be recalled that last year, notwithstanding his pre-occupation with affairs of state in Australia, ,he undertook a most arduous mission to the United Kingdom and the United States of America to enter into consultations concerning the prosecution of the war. The mission involved a journey of some 30,000 miles, and in all probability took severe toll of his strength. But for the exigencies of war, the late Prime Minister’s widow could reasonably have expected years of financial security and the association of her husband. He, however, spent himself in the cause of his country in its time of peril.

I believe that this Parliament, and the people of the Commonwealth, would wish that his widow should be adequately provided for, and, therefore, I commend the measure to honorable senators for their favorable consideration.

Senator FOLL:
Acting Leader of the Opposition · Queensland

, - Members of the Opposition support this measure, and like honorable senators opposite, we regret very much the necessity for it. Not only does the measure draw attention once again to the loss of a colleague from this Parliament, whose passing has caused us all the pro- foundest sorrow, but also it is a reminder of the unfortunate fact that in this country no other means of dealing with cases of this kind are provided. This is the second occasion within the last few years on which a Prime Minister has died in office, after shouldering great burdens which must have taken serious toll of his health, and once again it has become necessary to make financial provision for the widow. On this occasion, I believe that it would not be out of place to draw attention to the fact that some special provision should be made for men who give yeoman service to their country and to this Parliament, and whose remuneration is not adequate to enable them to safeguard their future. I recall that Mr. “W. 0. Archibald, after many years of service as a Minister of the Crown, died some years ago absolutely penniless in a home for aged men in South Australia. There have been other cases of that kind. Since I have been a member of the Senate I have heard many speeches in which honorable senators of all parties have urged the provision of a superannuation or pensions scheme for members of the Parliament. To-day, when honorable members and honorable senators are taxed up to the hilt, they have to meet heavy expenses while travelling through their electorates, as well as hotel expenses while they are attending sessions of the Parliament in Canberra. As they must meet these heavy commitments out of their salary of £1,000 a year, they find it- impossible to make provision for their old age. Ministers are in exactly the same position, because practically all of their ministerial allowance is absorbed by tax. “Whilst J regret raising this matter, I believe that I do so appropriately on the bill now before us. The Opposition supports the bill. We regret extremely the circumstances which have rendered its introduction necessary. As I have said, a measure of this kind draws attention to the disability suffered by many members after giving many years of service in the Parliament, and the need to remedy that position.

Question resolved in the affirmative.

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

page 4785

MATRIMONIAL CAUSES BILL 1945

Bill received from ‘ the House of Representatives.

Standing and Sessional Orders suspended.

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

Second Reading

Senator ASHLEY:
Minister for Supply and Shipping · New South Wales · ALP

, - I move-

That the bill be now read a second time.

The Commonwealth Parliament has full legislative power with respect to divorce, but no divorce legislation has hitherto been passed by the Parliament, with the exception of a short act passed after the last war, the provisions of which are analogous to certain provisions of the present bill. The objects of this bill are twofold: First, to enable an Australian woman married- to an overseas serviceman or other person from overseas to institute divorce proceedings in Australia, and, secondly, to provide that a person domiciled anywhere in Australia may institute divorce proceedings in the State or Territory in which he or . she is for the time being resident. The necessity for some provision relating to a marriage between an Australian woman and an overseas serviceman arises, as honorable senators will understand, by reason of the number of such marriages which have taken place in recent times. In order that the Senate may have a proper understanding of the bill, I shall refer briefly to the existing jurisdiction of Australian courts in divorce. The first point is that the jurisdiction of an Australian court to dissolve a marriage arises, generally speaking, only where the parties to the marriage have their domicile in the State or Territory concerned. The second point is that the domicile of a person is the country in which is situated his permanent home. The third point is that the domicile of the married woman is always that of her husband. Where an Australian girl marries, for example, a United States serviceman in Aus*tralia, their normal expectation would be to return to the United States of America after the war, that is, to the place where the man has his home and where he carries on his civil occupation. In such a case, the permanent home of the serviceman is still regarded as being in the. United States pf America, so that he retains his domicile there. In accordance with the third point mentioned above, his wife also becomes domiciled in the United States of America. Under the existing law, if the husband or the wife commits a matrimonial offence, such as would entitle the other to institute divorce proceedings, those proceedings cannot be instituted in Australia because the domicile, that is, the permanent home, of the parties, is not in Australia. This position is capable of inflicting grave hardship, particularly in cases in which the wife desires to bring divorce proceedings. There would, in most instances, be considerable practical difficulty and inconvenience in adducing the necessary evidence to found divorce proceedings in an American court. Moreover, it is only persons with considerable’ means at their disposal who could afford to institute proceedings overseas. The bill is designed to provide that proceedings to dissolve such a marriage, which has broken up before the parties have returned to the land of the husband’s permanent home, may be taken in the courts of this country. The proposed provisions would not apply where the parties have gone to live in the country of the husband’s permanent home, since it appears to be just that, in those circumstances, the ordinary rules should apply. I gave as an example the case of an Australian woman married to a United States of America serviceman, but the provisions in the bill are applicable to any marriage celebrated in Australia between a man domiciled out of

Australia and a woman domiciled in Australia, on or after the 3rd September, 1939, and before an appointed day which it is not proposed to fix before the end of the war. When, in peace-time, a man from another country marries an Australian girl, he would normally be able to return to his own country. But in the present abnormal circumstances, a couple cannot in many cases return to the husband’s permanent home. The problem to be met is, therefore, a temporary one, and. for that reason the Government thinks it desirable that the application of the provisions of the bill should be limited to marriages celebrated within the prescribed period. The principle of this part of the bill is one which, I trust, will commend itself to the Senate. Similar legislation has already been passed in Great Britain, and provision is included in this bill for a reciprocal arrangement between Australia and any other country passing similar legislation for the recognition by each country of divorces granted under the corresponding legislation in the other.

The bill also makes provision to meet the difficulty which arises where a person wishing to obtain a divorce is resident in a State which is not that of the domicile. It frequently happens that a wife is deserted by her husband, who goes to another State and establishes a new domicile there. As I have said, a wife cannot acquire a domicile separate from that of her husband, so that in such a case she acquires her husband’s new domicile and cannot take proceedings for divorce in the State where she resides. In some, if not all, of the States, provision has been made to meet this difficulty by providing that a deserted wife shall be deemed to have retained, for the purposes of divorce proceedings, her domicile in the State in which she was deserted. It is by no means certain, however, that a divorce obtained under this provision is valid elsewhere than in the State in which it is obtained, and if either party to the marriage remarries elsewhere he or she runs some risk of committing bigamy. The position I have mentioned is a cause of great hardship. The difficulties of expense and of producing the necessary evidence frequently preclude a deserted wife from instituting divorce proceedings. The need for an Australia-wide matrimonial domicile was raised by the late Mr. Maurice Blackburn when he moved in the House of Representatives in March, 1936, that legislation should forthwith be introduced to meet this need. In the course of his speech, Mr. Blackburn said -

I propose that we should hare an Australian domicile and that a person who comes to Australia and lives in any part of it and chooses Australia as his permanent, final and definite home, should be regarded as domiciled in Australia, and that this should be acceptable in any State court. . . .

The domicile of a person should be settled once and for all by this Parliament, and the States, in order to determine jurisdiction; should, under Commonwealth law, adopt such a test of jurisdiction - probably that of the usual place of residence.

Reference to the need for legislation to overcome the difficulties arising in connexion with the exercise of divorce jurisdiction by the courts was made by Sir Isaac Isaacs, then Mr. Justice Isaacs, in a case decided about thirty years ago, when he said -

For the purposes of divorce jurisdiction, the Australian States are still different countries. The difficulty must be faced where ….. different communities have different views and laws respecting matrimonial obligations, and a different estimate of the causes which should justify divorce. But section 51, sub-section (xxii) of the Federal Constitution gives the Commonwealth Parliament power to make laws with respect to “ divorce and matrimonial causes “ and 1 would wish to draw the attention of the Commonwealth Parliament to the question in order that consideration may be given to the desirability of allowing the present state of things to continue in the Australian community.

From time to time, other judges also have made references to the need for Commonwealth legislation to remedy the present undesirable state of affairs.

The bill does not provide for an Australian domicile in respect of matrimonial causes, nor does it provide for uniformity in divorce law in Australia, but it does purport to remove some of the disabilities at present suffered by persons, particularly women, in connexion with the institution ‘and conduct of matrimonial causes in Australia. Under the existing laws a suit for divorce must be brought in a court of the part of Australia in which the parties are domiciled. This has been found to be a cause of hardship in many cases, and accordingly the bill provides that a person who has been resident in a State or Territory for not less than one year may institute divorce proceedings in that State or Territory although that person is not domiciled there. The grounds on which the divorce may be obtained are the grounds provided by the law of that person’s domicile. I wish to emphasize the latter provision particularly, because its effect is not to enlarge or increase the grounds on which any person may take proceedings for divorce. The sole effect of the provision is to help the person to take proceedings in the court of the part of Australia in which he or she is resident, but only on the grounds which would be available if proceedings were taken in the court of the domicile. The objective of this part of the bill, I am sure, will commend itself to the Senate. This legislation will be of benefit to many women who at present, through lack of means or other circumstances, are prevented from obtaining a divorce to which they are morally, if not legally, entitled.

Senator FOLL:
Acting Leader of the Opposition · QUEENSLAND · NAT; UAP from 1931

– There will be no opposition to this bill from senators on this side of the chamber, for we recognize that the large influx of people into this country owing to the war has made this measure necessary. The Minister (Senator Ashley), in moving the second reading, said that the bill, of course, did not make any attempt to institute a uniform divorce law for Australia. Section 51 of the Constitution empowers this Parliament to legislate in order to apply a uniform marriage law to Australia, but the exercise of that power has been studiouslly avoided by Commonwealth governments of all political colours since the achievement of federation 45 years ago. It is most desirable that in the near future a uniform divorce law be instituted throughout Australia.

Senator Collett:

– Marriage law, too.

Senator FOLL:

– Yes. That is also provided for in the Constitution. I regret that some marriages of Australian women to Allied servicemen have . been wrecked, but I suppose that that is one of the inevitable results of war. Many more marriages have been happy, and I hope that they will continue to be. I hope the bill will achieve the intended result.

Question resolved in the affirmative.

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

page 4787

SUPERANNUATION BILL (No. 2) 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That the bill be now read a second time.

This bill aims to protect the superannuation rights of certain State employees who will be appointed to the Commonwealth Public Service in connexion with the administration of the Commonwealth Employment Service established under the Re-establishment and Employment Act. An employee who resigns from the State service to come over to the Commonwealth, and who pays to the Commonwealth Superannuation Board the amount of refund of contributions received by him from the State Superannuation Fund,, will be eligible to continue his contributions at the same rate as under the State scheme. These contributions will be in respect of rights to units of pension under the Commonwealth Act, which are certified to be the equivalent of the rights under the State act, and which will be based on the retiring age of 60 or 65 years, whichever is appropriate. Such an employee will not be required to submit to the usual medical examination in respect of those pension units and the Commonwealth will, for a period of five years from the date of appointment, relieve the superannuation fund of any liability due to the waiving of the medical test.

If at any time in the future it is necessary to increase the rates of contributions generally, provision is made that the contributions payable by these employees in respect of the pension units brought over from the State will also be increased by similar amounts.

A State employee may, on appointment to the Commonwealth service and if he so desires, retain the amount of refund received by him from the State fund and not pay it to the Superannuation Board. In that event, the employee will come under the Commonwealth scheme as a new contributor at rate for age next birthday and will also be required to pass the usual medical examination.

Senator COLLETT:
Western Australia

– There is nothing in this measure to which the Opposition takes exception. I understand that its object is to meet the superannuation circumstances of a considerable number of officers transferred from the Public Services of the States to the Commonwealth Public Service as the result of the expansion of the activities of the service.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 3 agreed to.

Clause 4 -

After Part IVc. of the Principal Act the following Part is inserted: - “ Part IVd. - Special Provisions in Relation to Certain Former State Employees. “60an. - In this Part, unless the contrary intention appears -

State employee’ means a person appointed or employed under Division 9a of Part III. of the Commonwealth Public Service Act 1922-1945 who, immediately prior to his being so appointed or employed, was a contributor to a State Fund;

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That, in proposed new section 60an, in the definition “ State employee “, the figures “ 1945” be left out with a view to insert in lieu thereof the following figures and words: - “ 1 943, as amended by the Commonwealth Public Service Act 1945 “.

This amendment is necessary because theRe-establishment and Employment Act has not yet been proclaimed. The amendment makes the necessary alterations to the citations of the previous bill.

Amendment agreed to.

Clause further consequentially amended and, as amended, agreed to.

Title agreed to.

Bill reported with amendments; report adopted.

Bill read a third time.

page 4788

WINEOVERSEAS MARKETING BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That the bill be now read a second time.

This bill amends the Wine Overseas Marketing Act in several respects, its principal feature being the appointment of two additional representatives of grape-growers to the Australian Wine Board. Honorable senators will be aware, no doubt, that the Australian Wine Board as at present constituted consists of nine members, seven of whom represent co-operative, proprietary and privately owned wineries and distilleries; one the Commonwealth Government; and one the grape-growers who supply grapes to wineries and distilleries. The representatives of wineries and distilleries are appointed on the nomination of their appropriate associations and the grape-growers’ representative upon the nomination of the FederalGrapegrowers Council. Grape-growers constituting the Federal Grapegrowers Council have displayed considerable interest in the activities of the Australian Wine Board and because of the close association existing between grapes and wine have expressed a strong desire for increased representation on the board. As an expansion of the grape industry in connexion with post-war planning undoubtedly will demand attention, such a request is considered to be fully justified and it is proposed by this bill to increase the number of grape-growers’ representatives on the board to three. It is therefore proposed that section 5 (2) of the principal act should be amended accordingly. The additional two representatives are to be appointed inthe same manner as the present one, namely, upon the nomination of the Grapegrowers Council. The first appointments will be made for the unexpired portion of the three years term for which the present members were appointed, so that subsequently, all appointments will be made at the same time.

Another amendment to be effected by this bill protects the position of members of this Parliament or of a State Parliament who may be appointed to the Australian Wine Board. As section 9 is worded at present, such an appointment might have the effect of voiding the election of a member to the Commonwealth or of a State parliament as such an appointment may be regarded as” an office of profit under the Crown”. The section as amended makes it clear that a member of Parliament is only to be reimbursed for his out of pocket expenses incurredby reason of his membership of the board. Other members are of course paid fees as prescribed by the regulations for their services. None of the present members of the board is affected by this amendment which is being incorporated to bring the Wine Overseas Marketing Act into line with similar acts relating to other industries.

The position of permanent officers of the Commonwealth Public Service who may be appointed to the Australian Wine Board is also clarified. Such officers are paid for their services in accordance with the provisions of theCommonwealth Public Service Act, and the amendment of the Wine Overseas Marketing Act now under review provides that in such circumstances any fees or allowances shall be payable to the Commonwealth. Similar provision is made in relation to an officer of the Commonwealth Public Service who may be appointed as a member of the London agency of the board if such action be found desirable.

Owing to the wording of section 10 of the principal act, it has been necessary for the Australian Wine Board to meet in the month of July for the sole purpose of electing its chairman. Section 29 of the act provides that the board must submit an. annual report before the 30th September each year, and it is proposed to authorize the board to elect its chairman before that date also. The bill also makes provision for the appointment of a chairman should that position on the board become vacant during the year.

Some of the amendments are not of great moment at present but are necessary to meet possible emergencies which may arise. The principal alteration is the provision to grant additional representation to grape-growers, which accords with the Government’s policy of granting producers the fullest measure of control in the disposal of their product.

Senator MATTNER:
South Australia

– It is not the intention of the Opposition to oppose this bill, but I should like to make a brief comment on the proposal that an additional two representatives of the growers shall be appointed to the Australian Wine Board. In view of the statement by the Minister for Trade and Customs (Senator Keane) that the grape industry is to be given greater consideration in the future, the appointment of three growers’ representatives to the board is a wise decision on which I commend the Government.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 4 agreed to.

Clause 5 (Executive Committee of Board).

Senator MATTNER:
South Australia

– In my remarks on the second reading, I omitted to point out that of all the States, South Australia is the biggest wine producer, and has the most extensive interests in the grape industry. For that reason, I express the hope that two of the three members of the proposed board will be representatives of South Australian producers and interests.

Clause agreed to.

Clauses 6 and 7 agreed to.

Title agreed to.

Bill reported without amendment; report adopted.

Bill read a third time.

page 4790

DARWIN LANDS ACQUISITION BILL 1945

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That the billbe now read a second time.

This short measure is designed to authorize the acquisition by theCommonwealth of freehold land in the town of Darwin and its environs. A full description of the area affected is contained inthe schedule to the act. It is proposed to acquire the land either by agreement or compulsory process in accordance with the provisions of the Lands Acquisition Act 1906-1936, as applied by the Lands Acquisition Ordinance 1911-1926 of the Northern Territory. As set out in clause 3, land may be acquired for either or both of the following purposes -

  1. the replanning and development of the town of Darwin and its environs; and
  2. the institution of a system of leasehold tenure from the Crown in respect of any such land.

Clause 4 provides that the value of any land acquired shall be assessed without reference to any increase in value which might arise from the proposal to carry out the purposes specified. Clause 5 will authorize the appropriation of the sums necessary for the acquisition of the land. By clause 6 land acquired in pursuance of the act becomes Crown land.

As the result of the bombing of Darwin, many of the houses and buildings were destroyed. Other property has been demolished to meet defence requirements. The whole of Darwin’s “ Chinatown “ has disappeared. It is the carefully considered view of a number of authorities that all freehold land in the Darwin area should be acquired by the Commonwealth, and that in future town allotments should be made available under a system of leasehold tenure on a basis similar to that operating in Canberra. The proposal is strongly supported by the Central Hirings Committee, the War Damage Commission, the well-known town planner, Mr. R. A.

McInnis, the Administrator of the Northern Territory, the Commonwealth Surveyor-General, and the Interdepartmental Committee on Darwin. A group of army officers, all of whom have had experience in civil life in town planning and dealings in land, prepared a report on and plan for the town of Darwin after a lengthy period in the north. They strongly advocated the institution of a leasehold system for the town. This report was fully endorsed by senior Army officers in the area.

The acquisition is desirable in order to enable the future development and potentialities of Darwin to be exploited to the best advantage from both a civilian and a defence point of view. The present time is most opportune for the acquisition of all privately-owned property at a minimum cost. The Commonwealth is already committed to a substantial part of the cost and there will be no disturbance of civilian activities. The civilian population has not yet been permitted to return and at present no private businesses are functioning. Practically the whole of the existing buildings are still occupied by service personnel for defence purposes. The proposed alteration of tenure will also have the effect of conserving to the Commonwealth the unearned increment in the land arising from the heavy expenditure of Commonwealth funds which may be anticipated in the development of the town. It is hoped that it may be possible in many cases to acquire the privatelyowned land at the unimproved capital value and to arrange with the owners of the improvements to lease the land and retain the improvements thereon. It can be expected that a proportion of the improvements are erected on blocks which will not fit in with the town plan which will ultimately be adopted. In such cases the compensation payable would be in respect of both land and improvements.

In the town of Darwin proper there are 491 sections held under freehold tenure and 74 sections held under leasehold tenure. Of these, 219 sections were unimproved at the 19th February, 1942. the date of the Japanese air raid on Darwin, and 214 sections had buildings standing on them at the 22nd April, 1944, indicating that 132 sections which were improved at the 19th February, 1942, carried no improvements at the 22nd April, 1944. In the area suburban to Darwin there are 65 sections held under freehold tenure, and 121 sections held under leasehold tenure. Of these, 97 sections were unimproved at the 19th February, 1942, and 59 sections had buildings standing on them at the 22nd April, 1944, indicating that 30 sections which were improved at the 19th February, 1942, carried no improvements at the 22nd April, 1944. It is not possible at this stage to give a firm estimate of the cost of the proposed acquisition, but the following tentative figures prepared by the Central Hirings Committee will give some indication of the cost involved. - Unimproved value of land, £150,000, value of improvements, £500,000, total, £650,000. Against this sum the Commonwealth is already committed to an expenditure in the vicinity of £200,000 for damage by enemy action, fire, demolitions, occupation and other causes. Thus it would appear that the net cost to the Commonwealth of the acquisition may not exceed £500,000.

Senator GIBSON:
Victoria

.- [ do not think that any member of the Opposition will oppose the measure, notwithstanding the fact that some honorable senators on this side oppose the nationalization of land just as strongly as they oppose the nationalization of industry. This will be the second instance of the nationalization of lands, the first being Canberra. I am not satisfied- that Darwin will be the capital of the Northern Territory. It will be the principal sea-port, but if the Northern Territory is to be developed to any great degree, I imagine that Alice Springs, or some other centre, is more likely to become the natural capital. I am opposed to the nationalization of land even in city areas. Of course, one must recognize that leasehold tenure is essential in extensive areas in the Northern Territory, “Western Australia and Queensland, where, in some districts, thousands of acres are held by one lessee. However, it is wrong to apply the principle of nationalization to homes and dwellings. The average person takes a pride in his own home, but when the land on which the dwelling stands is leasehold, he cannot strictly be said to own his own home. I hope that we shall not repeat in Darwin the system followed in Canberra of segregating residents according to their salary ranges. It is entirely wrong to separate the people on that basis. We should encourage the community as a whole to mix. Such class distinction should not be permitted.

With respect to the payment of compensation I ask that the right of appeal be given to persons whose freehold is acquired by the Government, should they be not satisfied with the compensation offered to them. In cases of compulsory acquisition no allowance whatever is made in respect of the sentimental value which owners may attach to their properties. Under the regulations applying in the Northern Territory, owners will have the right to appeal to the Supreme Court, or perhaps, the High Court, but the cost involved in such procedure would, in many of these cases, exceed the total value of the land proposed to be resumed. Owners of property should have an inexpensive right of appeal against any valuations that will be made. The total amount of money involved is not great, as the unimproved value of the properties proposed to be acquired is estimated at £150,000. The Government seems to consider that the value of land in Darwin will be enhanced after it comes under government control, but I do not think so. As the improvements on the land to be acquired are valued at about £500,000 it would appear that the Government will retain about £200,000 of insurance money belonging to persons whose properties have been damaged or destroyed. According to the Minister’s statement, that money will be retained by the Government and deducted from the amount to be paid to the owners of such properties. The Senate should know what the Government has in mind in regard to the future of Darwin. For instance, does the Government propose that hotels and business places there, as well as the land, shall be nationalized? We should know also what expenditure is likely to be incurred in the development of the town. We are entitled to something more than the bald statement that the Government proposes to take about 90 square miles of country and convert it into leasehold land. I agree that the Government would be justified in resuming land for public buildings, parks, sports grounds, schools, aerodromes and other amenities necessary to a modern city. If land for those purposes only were to be compulsorily acquired, no one would object; but many owners of property in Darwin are likely to receive less than the amounts paid by them for their property. An example of what may be expected at Darwin may be seen in what occurred in connexion with land acquired for extensions to the Essendon aerodrome. Many owners of land there were paid only about one-fourth of what the land cost them. I hope that that injustice will not be repeated at Darwin, and that owners of property there will at least be recouped their expenditure in the purchase of land. I am disappointed at the lack of development which has taken place in the Northern Territory during the last 20 or 30 years, and I look forward to the time when considerable progress will take place in that portion of the Commonwealth. The white population of the Northern Territory is still small, but if some of the land which is now devoted to cattle raising were converted into sheep land, and divided into smaller areas, the number of settlers could be increased considerably, and they would have a good chance of success. I do not like the leasehold system; I much prefer freehold; but as the Government has the numbers, and apparently is determined -to place this legislation on the statute-book, I can only say that we on this side wish it well.

Senator HERBERT HAYS:
Tasmania

– The purpose of this bill is to acquire private property in the town of Darwin so that all the land there shall be leasehold. That is not an entirely new principle in legislation, but I agree with Senator Gibson that the owners of the property to be acquired should not have to incur unnecessary expense in lodging appeals against the value placed on it. Whenever the Government sets out to acquire land, it seems to drive a hard bargain. It is well known that many owners of property compulsorily acquired <y the Government have suffered losses.

It may be that some of them bought the land as a speculation, but even in those cases I hope that in valuing their properties the Government will err on the side of generosity rather than adopt a harsh policy. In order to obtain what he considers is a fair price for his land an owner of property should not have to incur heavy expenses in obtaining the services of a person to plead his case. In all cases of litigation in which it is involved the Crown has the advantage. Rather than run the risk of incurring the expense of an appeal case many persons will accept the sum offered, even though they believe it to be too small. I hope that the mistakes of the past in connexion with acquired property will not be repeated in connexion with properties at Darwin. Whether the area proposed to be acquired is more than the future needs of Darwin will require, I cannot say. The proposal outlined in this bill is in the nature of an experiment. Although it is safe to assume that, for a good many years Darwin will not be much more than a garrison town, and that its population will consist largely of government officials, there is no doubt that it will assume greater importance in the future. A better harbour, as well as fortifications for the defence of the town, will have to be provided. I hope that some recognition will be given to the sentimental value of property to owners, and that they will not be put to heavy expense to defend their rights.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– I hope that the Minister for Trade and Customs (Senator Keane) will reply to the points raised by Senators Gibson and Herbert Hays, and particularly that he will give some indication of the Government’s policy for the future development of Darwin. For instance, I ask him to indicate whether the Government intends to acquire not only the land, but also hotels and business places in Darwin. The Government must have some plan in mind. We should know what the next step is likely to be. When I was Minister for the Interior, I was responsible for sending Mr. Mcinnes, a town planner, to Darwin. He submitted a valuable report in which he indicated what was necessary to make a satisfactory town on the site occupied by the present town. As honorable senators know, Darwin has grown up more or less haphazardly, and unless the town is dealt with as a whole, as this bill contemplates, it will be practically impossible to lay it out as a modern town should be planned. The existence of some freehold land should not be allowed to stand in the way of the planning of a modern town. As a former Minister for the Interior, and one who has taken some interest in Darwin, I believe that there is no alternative to an almost completely fresh start if Darwin is to become a town of which Australia will have reason to be proud. There are some excellent modern buildings there, but the absence of a general plan of development has depreciated their value. I hope, however, that in developing Darwin the Government does not propose to conduct an experiment by socializing businesses, hotels and amenities generally.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

in reply - All owners of property at Darwin will have a right of appeal against the Government’s valuation of their property. It has been suggested that in defending their rights, property-holders may be involved in considerable expense. I point out that in the House of Representatives the Minister for the Interior (Mr. Johnson) said that, if necessary, he would consider the appointment of a special tribunal to deal with appeals. My officers inform me that it will not be necessary for all owners of private property there to move off their land. The bill before us is the first step towards a comprehensive scheme for the development of Darwin. There will be no difficulty in arriving at the value of the land. Already numerous acquisitions have taken place and values are fairly well established. As to improvements on the land, it will be necessary to have a close liaison between the Department of the Interior, the War Damage Commission, and the Hirings Administration, all of which will be involved. Conferences have already taken place between representatives of those bodies, and there is no fear that a satisfactory working arrangement cannot be arrived at. It is not the intention of the Government to engage in business in Darwin.

Senator Gibson:

– Or to nationalize the hotels?

Senator KEANE:

– No. The purpose of the Government is to ensure that Darwin shall be rebuilt on modern town planning lines and that those who will live there in the future shall have the maximum of comfort.

Question resolved in the affirmative.

Bill read a second time, and reported from committee without amendment or debate.

Standing and Sessional Orders suspended; report adopted.

Bill read & third time.

page 4793

LIFE INSURANCE BILL 1945

Second Reading

Debate resumed from the 19th July (vide page 4237), on motion by Senator Keane -

That the hill be now read a second time.

Senator J B HAYES:
Tasmania

, - This bill provides for the control of life insurance offices in Australia. One could be forgiven for saying, at first sight, that it is not necessary, because Australia has’ been particularly fortunate in its splendid life insurance companies. Many of our life insurance offices, which I will not name, are the embodiment of fair dealing, integrity and soundness, and would be a source of pride in any country. Nearly all life insurance offices in Australia are mutual societies, the whole of whose profits are divided between strengthening their organization and the payment of bonuses to policy-holders. There are no shareholders to whom dividends must be paid. The bill sets out, by means of such controls as supervision and audit, to raise the standard of companies that may not be up to the required high standard. I hope nothing will be done by the Government to prevent worthy new companies from starting business, or to impose harassing restrictions on existing companies. Of course, all companies, for their own purposes, conduct their own audits through fully qualified auditors, but the bill empowers the Government, if it is not satisfied with the solidity of a company, to appoint auditors to make a .check audit.

I see nothing wrong with that. Too much care cannot be taken to ensure that everything shall be above board with companies or individuals having the control o£ people’s property or money, I think the principle of this measure should be extended to cover solicitors, sharebrokers and others who hold clients’ money on trust or otherwise. I hasten to say that practically every solicitor and sharebroker in Australia could immediately account for every penny of the money of their clients, but there may be exceptions that should be guarded against by the institution of a system of audit similar to that provided for in this bill. The principal reason for the introduction of this measure is the need to protect policy-holders. They are the persons that need protection. The people that insure their lives, for either a term of years or the whole period of their life, desire to be absolutely sure that the contracts shall be carried out. This bill will go a long way towards giving them that assurance. Like other honorable senators, I have received from the New South Wales Branch of the Industrial Life Assurance Agents Union, a letter setting out its opinions about this legislation; It is a large union. According to the letter, it has a membership of 3,500 in New South Wales. It asks that clauses 78, 79 and 129 be amended in certain directions. The letter says -

We are afraid if the existing provisions- of the hill are retained that the power proposed to be granted to an actuary to certify the amount of commission to be paid under a table or on a policy will be dangerous. The actuary would presumably be employed by the company and could be prejudiced by such employment.

I have been notified by the Minister in charge of this bill (Senator Keane) that amendments to be proposed by him will meet the wishes of the union in that matter.

Senator Keane:

– The union has acquiesced.

Senator J B HAYES:

– I am glad of that. The letter proceeds -

The other amendment we seek is that similar provision be made to protect agents and employees as this bill now provides to protect guarantors of such agents and employees, re. garding returns of commissions paid when policies lapse. The present practice, which the act does not seek to reform, is that an em ployer pays or credits an agent commission in respect of a new policy sold, but should the policy owner fail to pay at least three years’ premiums, then the agent must pay hack all the commission he received for the work of introduction, this notwithstanding the fact that the employer does not refund any of the premiums paid on the policy.

I do not know whether the Minister has considered that matter or whether the amendments he proposes cover it, but it does seem, prima facie, worthy of consideration, and I hope that the Minister in his reply, will say something about that.

Part VI. empowers the Government to set up by regulation any kind of insurance office in Australia. This is a bill dealing with life insurance, but this Part, when passed into law, will enable the Government to set up an insurance office to deal with not only life insurance but also fire, accident, and all other kinds of insurance. I do not li’ke the principle of the Government being able to take that action without reference to Parliament. If the Government considers it necessary at any time to set up an insurance office to handle any kind of insurance it should introduce legislation for thai purpose so that the Parliament shall be the deciding authority. In the establishment of an insurance office there are one hundred and one things that have to be done that should be the subject of specific legislation fully debated and considered by the Parliament.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– I agree with the Minister for Trade and Customs (Senator Keane) that this bill is overdue. In New South Wales, some years ago, a lot of mushroom life insurance companies’ sprang up almost over night and went out of existence about as quickly, with consequent loss’ to shareholders and policy-holders. Had this legislation been on the statute-book, that would not have been possible. Fortunately, most States years ago enacted effective life insurance legislation, but New South Wales, the greatest State of all, was for years, negligent of its duty to protect policy-holders. No fidelity bond was required on the establishment of a life office. Any one could establish a life office merely by printing a name on a window; getting a table and chair and accepting .premiums on people’s lives. Many such companies were absorbed by other companies, but some companies went right out of existence, with considerable loss to policy-holders and shareholders alike.

Although mutual life companies are a striking example of what the people can do’ by co-operative effort, I have never been able, for the life of me, to understand why the great mutual life offices of Australia, which have done wonderful work, have not reduced the rate of premiums in accordance with the greater expectation of life that has been brought about in the last 30 or so years by medical science. The probable reply of a life insurance company to a statement that it should reduce premiums in accordance with that trend would be, “But look at the bonuses we pay “. The person who takes out an insurance policy on his life is not so concerned with the bonus rate as with obtaining at the cheapest possible rate a cover on his life in order that his dependants may not be left destitute on his death. Most people insure their lives when rearing young families to ensure that in the event of their early death, whether the policies be endowment policies, payable at a certain age, or whole-life policies, their families shall be provided for. That is their main concern. Attractive bonuses are not so important to them as are low premiums. I think, therefore, that the insurance companies would act wisely if they reduced premiums in accordance with the increased expectation of life.

No objection is raised by the Opposition to the general provisions of this measure. Clause 132, however, gives to the Government authority to establish a Commonwealth Government insurance office, and I should like to know if it is the intention of the Government to establish such an office and to operate it in competition with the big mutual companies. Personally I believe that it would be far better for the Government to exercise control over the existing powerful and efficient companies-, and give them every encouragement to continue their operations-, rather than to establish a socialistic government insurance office to operate in competition against them.

I say again that in view of the great advance that has been made by medical science, life assurance companies would be well advised to consider whether or not premiums on life assurance policies are not too high. If they are too high, then a reduction should be effected so that people in this country may obtain the benefits of life assurance under the most favorable terms.

Senator COOPER:
Queensland

– Life insurance has grown in popularity tremendously during the past 50 years. One reason for that growth is that insurance offers to people a sound investment for their money. The percentage of the population holding insurance policies iri this country is not so great as it is in some of the older countries. No doubt one reason for that is that Australia is a comparatively new country, and offers more opportunities for advancement and small investment than are offered in the older countries. Insurance in Australia had a very small beginning but there are now more than 4,000,000 life insurance policyholders iri this country. That shows the degree to which the people of Australia have become insurance-minded. Life insurance policies are not the prerogative of one particular class of individuals. They are held by people in every walk of life. Thus legislation will be applicable to ali life insurance companies in. this country - a reform that is long overdue. At present, life insurance companies operate under the laws of the various States. The main objective of the bill is to safeguard the interests of policy-holders but the measure includes a clause which I would rather see omitted. I refer to the provision empowering the Government, by regulation, to set up a government insurance office.

Senator Keane:

– That will not be done without legislation. That is quite definite.

Senator COOPER:

– I am glad to have that assurance from the Minister. It takes quite a lot of sting out of the bill. For some years past, a State insurance office has been in operation in Queensland. In that State also there is a law compelling insurance companies to deposit with the Treasury sufficient funds to safeguard the claims of their policyholders. Certain clauses of this measure are on somewhat the same lines as the provisions of the Queensland State legislation. The Queensland Government insurance office has proved a successful venture, lt has, of course, a monopoly of workers’ compensation insurance, and it is compulsory for any person who receives an advance from a governmental institution for the construction or purchase of property to insure that property with the State Insurance Office. If a Commonwealth Government Insurance Office is to be established, is it the intention of the Government that it shall operate in competition with the Queensland Government office? Commonwealth law of course, would be paramount, and if a Commonwealth Insurance Office were established it would, as far as I can judge, be able to take over the business of the State office.

It is pleasing to know that such a large proportion of the people of this country deem it expedient to hold life insurance policies. That is a very healthy condition, and one which should act as a brake upon any government which may be tempted to take action which might lead to currency inflation Holders of insurance policies would be the first to suffer from inflation, because the purchasing power of their policies, upon liquidation, would be substantially reduced.

There are a few matters upon which I shall seek further information when the bill reaches the committee stage.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clauses 1 to 3 agreed to.

Clause 4’ - (I.) In this Act, unless the contrary intention appears - “trade union” means any association registered under any State Act or law of a Territory as a trade union.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That, in sub-clause (1.), after the definition of ‘trade union” the following definition be added : - “war service’ means service with any

Naval, Military or Air Forces of any part of the King’s dominions and includes any engagement in aviation as part of that service.”

The definition of “war service” is made necessary by the amendment of clause 121, secured by the honorable member for Balaclava (Mr. White) in the House of Representatives. This clause prevents a company from limiting the benefit of any policy issued after the commencement of this legislation if the death of the person insured occurs on war service, unless the person who effected the policy has .agreed to that limitation in writing. It seems desirable to make particular mention of aviation as it is common practice for companies to have two limiting clauses in their policies, the first dealing specifically with war risks, and the other with aviation risks.

Amendment agreed to.

Senator COOPER:
Queensland

– This clause states that - “ collector “ includes every person, howsoever remunerated, who, by himself or by any deputy or substitute, makes house to house visits for the purpose of receiving premiums payable on policies, and includes such a deputy or substitute.

I should like to know whether that definition covers collections in factories of premiums on industrial policies, or collections under the group assurance schemes? Is it limited only to house to house collections?

Senator Keane:

– No, it may cover other things.

Senator HERBERT HAYS:
TASMANIA · NAT; UAP from 1931; LP from 1944

– What will be the position under this amendment of ordinary citizens who travel by air? Will their life insurance policies be affected in any way?

Senator FOLL:
Acting Leader of the Opposition · Queensland

– The point raised by Senator Cooper is causing much concern to several honorable senators, because under the definition “collector “ means a person who “ makes house to house visits “. In recent years, there has been a large development of group schemes in the field of industrial life insurance. Members of staffs in shops and factories form groups and pay a small amount each week, the total amount of the premiums collected in this way being paid to the company by cheque. Some life insurance companies quote special concessional rates in respect of policies taken out under the group scheme. Such policies are listed under Table I. which, in insurance practice, is included in the industrial section. Does the phrase “ house to house visits “ in the definition of “ collector “ mean houses solely, or does the definition cover a collector who may collect premiums in shops or offices?

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

Senator Herbert Hays, apparently, referred to the practice in recent years of outlining certain risks on policies. The amendment in no way applies to that practice as far as civilians are concerned.

Senator FOLL:
QUEENSLAND · NAT; UAP from 1931

– Does the definition “ collector “ cover persons who receive premiums in factories or shops? Is the term used in the sense in which it is understood in life insurance practice?

SenatorKEANE. - The term is used as understood in life insurance practice.

Clause agreed to.

Clause 5 -

This Act shall apply to State insurance extending beyond the limits of the State concerned.

Amendment (by Senator Keane) agreed to -

That the word “This” be left out with a view to insert in lieu thereof the following words: - “Subject to the next succeeding subsection, this “.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That, at the end of the clause, the following new sub-clauses be added: - “ (2.) Where the policies issued by any authority of a State carrying on life insurance business are guaranteed bythe State, Division 2 of Part III. of this Act shall not apply to that authority. “ (3.) The provisions of this Act shall not apply to -

any fund which is maintained by a company in respect of any part of its life insurance business, where none of the liabilities arising out of that part of its business relates to any policy registered by the company in Australia; or

b ) the part of the life insurance business in respect of which that fund is maintained.”.

If a State Government life insurance office desires to transact business beyond the limits of the State concerned, it must comply substantially with the provisions of this bill as the Commonwealth is responsible for seeing that policy-owners in other States receive benefits which are not less than are secured to them by the provisions of this bill. If, however, the State office has its contracts guaranteed by the Government of that State it is obviously not necessary for it to lodge a deposit with the Treasurer. Proposed new sub-clause 2 makes this clear.

If a company has a separate fund for its overseas business, that fund may be subject to the provisions of the country to which it relates, and such provisions may not be consistent with the provisions of this bill. It may not be possible for the company to comply with the legislative requirements in both Australia and the other country to which the fund relates, and as the responsibility of the Commonwealth is to see that only Australian policy-owners are fully protected, proposed new sub-clause 3 provides that any fund which does not include a liability to any Australian policy-owner shall not be subject to the provisions of this bill.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 6 agreed to.

Clause 7 (Repeal).

Senator FOLL:
Acting Leader of the Opposition · Queensland

– Does the clause mean that the payment of deposits required from companies under a State act will automatically cease! Will such deposits in future be payable to the Commonwealth, , and will insurance companies be entirely subject to this measure? I should like to be assured that no duplication of deposits will arise under the clause.

Senator Keane:

– There will be no duplication.

Clause agreed to.

Clauses 8 to 32 agreed to.

Clause 33 (Increase of deposit where securities have depreciated).

Senator HERBERT HAYS:
Tasmania

– Sub-clause 1 reads -

If the Treasurer is satisfied that by reason of depreciation in the value of securities or other cause the value of money and approved securities deposited by a company with him falls short of the value required by this Act, he may, by notice in writing, require the company to deposit with him money or approved securities or both to a value deemed by him to be sufficient to bring the amount of the deposit to the value required by this Act.

How will this provision he applied, say, in a time of depression, or during a period when for various reasons, such as drought, the value of securities may depreciate substantially? Would the Treasurer call upon a company to increase its securities when, for the reasons I have mentioned, it would be beyond its capacity to do so? What exactly is implied by “depreciation in the value of securities ?”

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- If there were a serious depreciation in the value of securities, action would have to be taken by the Treasurer. This clause merely enables the Treasurer to keep the value of securities deposited up to the required level. In the event of a temporary depreciation, the clause would not be applicable.

Clause agreed to.

Clauses 34 to 37 agreed to.

Clause 38- (2.) Subject to the payment and application of such sums as may be allocated as surplus in pursuance of section fifty of this Act, the assets of a statutory fund shall not, so long as the company carries on the class or classes of life insurance business in respect of which the fund was established, be available to meet any liabilities of the company other than -

  1. liabilities referrable to that class or those classes of life insurance business; and
  2. liabilities charged on those assets or any of them immediately prior to the commencement of this Act, and shall not otherwise be directly or indirectly applied for any purpose other than the purposes of that class or those classes of life insurance business.
Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That,in sub-clause (2.), after the word “ liabilities “, first occurring, the words “ or expenses “ be inserted.

The reason for the amendment is to make it clear that the normal expenses of life insurance business may be paid from the statutory fund. It is obvious that this has to be so as all the premium and interest payments go into that fund and there would in many cases be no other money from which to meet the expenses. It was considered that the use of the word “liabilities” ofthe fund would include normal expenses, but as some doubts have arisen the opportunity is taken to resolve them.

Amendment agreed to.

Clause further consequentially amended and, as amended, agreed to.

Clauses 39 to 46 agreed to.

Clause 47 - (1.) A person appointed as an auditor of a company shall not be capable of performing the functions of an auditor under this Division unless the Commissioner has approved of his performing those functions.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That, at the end of the clause, the following new sub-clauses be added: - “ (4.) An appeal shall lie to the Court or the Supreme Court of a State or Territory against any refusal of the Commissioner to approve of any person performing the functions of an auditor under this Division, or against any revocation of an approval given in respect of any person under this section. “ (5.) On any such appeal, the Court may confirm or disallow the refusal or revocation.”

This amendment provides that an auditor shall have the right of appeal against any adverse decision of the commissioner regarding his qualifications to perform the function of an auditor under Division 4 of this bill. This amendment was submitted by the Leader of the Australian Country party (Mr. Fadden), in the House of Representatives, and the Government, after consideration, has decided to accept it.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 48 and 49 agreed to.

Clause 50 - (3.) If, as a result of the latest valuation made in respect of a company in pursuance of this Division, the valuation balance-sheet of any statutory fund of the company discloses that the amount of the statutory fund is greater than the amount of the liabilities of the company in respect of that fund, the company may allocate the surplus or any part of it, in any manner consistent with the provisions of the instruments constituting the company and the articles of association or other rules of the company:

Provided that -

in respect of the surplus derived from participating policies, the amount allocated to or for the benefit of the shareholders of the company shall not exceed twenty -five per centum of the amount allocated to or for the benefit of the owners of those policies.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That, in paragraph (b) of the proviso to sub-clause (3.), the words “ the surplus derived from participating policies” be left out with a view to insert in lieu thereof the following words: -that part of the surplus which is derived from participating policies registered by the company in Australia”.

This amendment makes it clear that the limitation on the allocation of a surplus to shareholders needbe applied only to that part of the surplus which is derived from Australian policy-owners. The Government could hardly enforce a provision of this nature in relation to business transactedbya company outside Australia.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 51 to 77 agreed to.

Clause 78 (Premium rates).

Senator COOPER:
Queensland

– Sub-clause 4 provides -

An actuary in approving a rate of premium in respect of any class of policy under this section shall have regard to the maximum rate of commission or rebate proposed to be paid or allowed to any person in respect of that class of policy.

As I interpret this provision, an actuary who is employed by the insurance societies will have the sole right to fix the rate of commission payable to an agent. But industrial tribunals have already made a number of awards dealing with the remuneration and allowances of insurance agents. If my interpretation of this sub-clause be correct, the decision of the actuary will override the awards of industrial tribunals, and this may have serious consequences. For example, the Arbitration Court, in making a determination, takes into account the cost of living, but an actuary would not do so. I ask the Minister (Senator Keane) to explain whether agents will still have access to the Arbitration Court, despite any decisionby the actuary?

Senator Keane:

– Yes. The necessary provision is made in clause 79.

Clause agreed to.

Clause 79 -

Where a rate of premium is approved by an actuary in respect of any class of policy the company shall not, except with the approval of an actuary, pay or allow in respect of any policy of that class a commission or rebate at a greater rate than the maximum rateof commission or rebate to which the firstmentioned actuary had regard when approving the rate of premium.

Amendment (by Senator Keane) agreed to -

That, after the word “actuary”, second occurring, the words “ or the Commissioner “ be inserted. “

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That the words “ at a greater rate than the maximum rate of commission or rebate to which the first-mentioned actuary had regard when approving the rate of premium.” be left out with a view to insert in lieu thereof the following words: - at a rate greater than -

the maximum rate of commission or rebate to which the first-mentioned actuary had regard when approving the rate of premium; or

the maximum rate of commission or rebate payable by the company, immediately prior to the commencement of this Act, in respect of policies of that class (if any) issued at the rate of premium so approved, whichever is the greater.”.

This clause was designed to prevent a. company from arbitrarily increasing its rebates on premiums in order to attract new business. At no stage does the bill attempt to fix the rate at which agents shall be remunerated, as this is a matter tobe determined by agreement or by arbitration. As it stands, the clause could be used to enforce reductions of the present commission rates. The two amendments make it clear that any increase of commission rates must be approved by the commissioner, or the company’s actuary, though it is left open for a company to negotiate in the usual way for reductions of the present rate. These amendments comply with the requests made by the union, which has had a long consultation with the Government’s advisers on the matter. I understand that the amendments meet with the wishes of the organization.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 80 to 89 agreed to.

Clause 90 (Assignment or mortgage of industrial policy not valid without consent of company).

Senator COOPER:
Queensland

– Sub-clause 2 reads -

If the company refuses its consent, the policy owner may appeal to the Commissioner whose decision shall be final.

Will the Minister enlighten us as to who the commissioner will be, and will he explain why provision has not been made for an appeal to a judicial body?

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– As owners of industrial policies are not always aware of the rights that they possess in regard to the surrender value of their policies, they frequently borrow money from money lenders at exorbitant rates of interest, the money lenders in such instances requiring them to assign their policies. Some of the larger companies are prepared to lend money on policies at lower rates of interest. It is not intended that the company shall be able to refuse consent to an assignment except where such refusal would be in the interests of the policy-owner. Hence the right of appeal to the commissioner against any unfavorable decision by a company.

Clause agreed to.

Clauses 91 to 102 agreed to.

Clause 103 (Probate or administration may be dispensed with in certain cases).

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That, at the end of the clause, the following new sub-clause be added - “ (3.) All persons to whom any such moneys are paid shall apply those moneys in due course of administration and, if the company thinks fit, it may require those persons to give sufficient security by bond or otherwise that the moneys so paid will be so applied.”.

This clause allows a company to pay claims up to £500 plus bonuses to certain specified relatives of a deceased person without requiring them to produce probate or letters of administration. Similar legislation is in force in all States except New South Wales and is found to be of great benefit in facilitating the early settlement of claims. It has been sug gested, however, that the clause might lead to certain persons misapplying the policy moneys, and the amending words, which are based on those in the corresponding Tasmanian Act, make it clear that the money shall be applied in due course of administration, and that tha company may, if it thinks fit, obtain a bond to this effect.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 104 to 108 agreed to.

Clause 109- (2.) A policy effected either before or after the commencement of this Act by the parent or a person in loco parentis of a child, whereby a company contracts to pay, on the death of the child under ten years of age, any sum of money which under sub-section (1.) of this section the company is not prohibited from contracting to pay, shall not in respect of the contract to pay that sum be deemed to be void by reason only that the person effecting the policy had not at the time the policy was effected an insurable interest in the life of the child.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That sub-clause (2.) be left out.

Sub-clause 2 deals with insurable interest in the case of a child’s policy and is now redundant in view of the wider provision as to insurable interest in clause 86.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 110 to 119 agreed to.

Clause 120 (Effect of suicide or capital punishment on policy).

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That the clause be left out with a view to insert in lieu thereof the following clause: - “ 120. A policy shall not be avoided merely on the ground that the person whose life is insured died by his own hand or act, sane ot insane, or suffered capital punishment, if, upon the true construction of the policy, the company has thereby agreed to pay the sum insured in the events that have happened.”.

As some doubts have arisen as to the interpretation of this clause, particularly the provision relating to suicides where the policy has been assigned, it seems desirable to adopt simpler wording which is taken from the New South Wales and Victorian acts on the subject of suicide. In effect, the new clause states that if the company has agreed to pay the sum assured in any event, whether to the assignee or not, it shall make that payment, notwithstanding the fact that the life insured committed suicide or suffered capital punishment.

Amendment agreed to.

Clause, as amended, agreed to.

Clause 121 (Condition as to war risk void).

Senator HERBERT HAYS:
Tasmania

– This clause reads -

Any term or condition of a policy issued after the commencement of this Act which limits, to an amount less than the sum insured, the amount payable under the policy in the event of the death of the life insured occurring on war service, shall not have any force or effect, unless the person who effected the policy agreed in writing to the insertion in the policy of that term or condition.

The clause provides that after the passing of this act the insured person must agree in writing to any change in the terms or conditions of a policy. Does it mean that a policy which was in force ‘before the passing of this legislation shall be subject to certain loading should the policy owner enlist in the forces? Can the Minister say whether such change shall be at the discretion of the company, and whether it can be made without the knowledge of the insured person? If that be so, the insured person may be in a position that he will have to pay the amount of the loan as, for instance, in connexion with a policy which is about to mature. What is to happen in the event of there being a conflict between the insured person and the company? The clause may affect a person who is called up for service and an injustice may be done to him.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– This clause deals with future policies and not with policies taken out before the war began. The provision is clearly selfexplanatory.

Senator HERBERT HAYS:
Tasmania

– If the insured person does not sign the altered conditions, what will be the position in regard to these policies? In the event of a dispute between the insured person and the company, what action will be taken to settle it?

Clause agreed to.

Clauses 122 to 133 agreed to.

Clause 134- (1.) The Commonwealth Government Insurance Office -

  1. may carry on life insurance business and such other kinds of insurance business as are prescribed.
Senator FOLL:
Acting Leader of the Opposition · Queensland

– I see no reason why Part VT. should be included in the bill. This measure is for the purpose of introducing uniformity of control of life insurance business. Why, then, does the Government take power to establish a Commonwealthowned insurance office? Senator Hays asked this question during, the secondreading debate, and the Minister, by interjection, said that no action- would be taken by the Government to establish a Commonwealth insurance office without bringing down further legislation for that purpose. Nevertheless, this part, including clauses 132 to 138, gives to the Government ample power to establish an office without enacting further legislation. Is it the intention of the Government to establish such an office immediately? Does the Government not appreciate the value of the work that has been done by existing companies, most of which work on a co-operative basis? There is no necessity for the Government to establish a socialistic insurance office to compete with the existing offices.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- I move -

That, at the end of the clause, the following sub-clause be added: - “ (3.) The Commissioner shall not be an officer of the Commonwealth Government Insurance Office.”

During the debate in the House of Representatives it was suggested that the commissioner might use confidential knowledge obtained from other life insurance offices in order to advance the business interests of the Commonwealth Government insurance office. Such a practice would be unethical and is not contemplated, but in order to clarify the position, this amendment, which was suggested by the Leader of the Opposition in the House of Representatives (Mr.

Menzies), provides that the commissioner shall not be an officer of the Commonwealth Government insurance office. I assure the Acting Leader of the Opposition (Senator Poll) that no attempt will be made to establish a Commonwealth Government insurance office without passing further legislation through this Parliament.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 135 and 136 agreed to.

Clause 137 (Taxation).

Senator KEANE:
Minister for. Trade and Customs · Victoria · ALP

.- I move -

That the clause be left out with a view to insert in lieu thereof the following clause: - “137. - (1.) Subject to this section, the Commonwealth Government Insurance Office shall not be liable to pay taxes imposed by or under any law. of the Commonwealth Olof any State or Territory, but that Office shall pay to the Treasurer such sums as are determined by the Treasurer to bc equivalent to the amount of the taxes which it would be liable to pay if it were a company. “ (2.) The Commonwealth Government Insurance Office shall be liable to pay such stamp duties imposed by or under any law of the Commonwealth or of any State or Territory ad it would be liable to pay if it were a company. “ (3.) The Commonwealth Government Insurance Office shall be liable to make such contributions as it would be liable, if it were a company, to make under any law of any State or Territory relating to fire brigades.”.

It has been pointed out that a life insurance company is subject to taxes other than income tax, and as it is desired that a Commonwealth Government office should have no undue advantage in this respect, it should likewise be liable to pay those taxes. The fact that some of these taxes would normally be paid to a State raises a complication, as it is not desirable that a Commonwealth instrumentality should pay taxes to a State government. Therefore, although the same amount of taxes will be paid, it is provided that the payment shall be paid to the Commonwealth Treasurer. A similar provision is included in the act which regulates the New South “Wales Government office, in which all amounts which should be assessed as taxation are payable to the New South Wales Colonial Treasurer. For similar reasons it is also provided that stamp duties and fire brigade dues shall be paid. These payments will be made to the authorities concerned.

Senator FOLL:
‘Acting Leader of the Opposition · Queensland

– I do not oppose the amendment. It is merely a matter of words. The whole provision in relation to payment of taxes by a Commonwealth Government insurance office relates only to book entries, because clause 136 states that all liabilities incurred .in respect of policies issued by the Commonwealth Government Insurance Office shall be the responsibility of the Crown. Although a debit might appear on the office books, the loss would, in fact, be borne by public funds.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 138 to 140 agreed to.

Clause 141-

Any .person may, upon payment of Buck fee as is prescribed, inspect at an office of the Commissioner any document furnished to the Commissioner under section fifty-two of this Act, and make a copy of,, or extract from, the document.

Senator KEANE:
Minister for Trade and ‘Customs · Victoria · ALP

– ] move -

That, after the word “ under “, the following words be inserted: - “sub-section (2.) of”.

If this amendment were not made, all the correspondence that the commissioner’ might have with a company, under subclause 3 of clause 52, regarding its returns, would become public property. This is undesirable, as the correspondence might ultimately lead to an appeal to the court under sub-clause 4 of clause 52. The amendment makes it clear that only the original documents returned under sub-clause 2 of clause 52 shall be available for inspection by the public.

Amendment agreed to.

Clause, as amended, agreed to.

Clauses 142 to 150 agreed to.

First, Second and Third Schedules agreed to.

Fourth Schedule -

Rules fob Calculation of Value of Liabilities on the Minimum Basis.

In the calculation on the Minimum Basis oi the value of the aggregate liabilities of a statutory fund in respect of its policies, the following rules shall apply: - (1.) The rates of mortality used shall be rates assumed according to the following tables: -

in respect of ordinary policies which are life policies other than annuity policies, the ultimate table based on the experience of insured lives for the years 1924 to 1029, and published on behalf of that Institute and that Faculty under the short title of A 24-29 Table; and

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

. -I move -

That in paragraph (1.) after the word “ tables “, first occurring, the following words be inserted: - “or to such other tables as are prescribed “.

This amendment and the next one which I shall move relate to the mortality tables to be used in the minimum basis for valuation. An error in the quotation of a short title for the A 1924-29 table is now corrected. As more up-to-date tables may be published, it is provided that the commissioner may, by regulation, vary the mortality tables.

Amendment agreed to.

Amendment (by Senator Keane) agreed to -

That in sub-paragraph (b) of paragraph (1.) “A 24-29” be left out, witha view to insert in lieu thereof “ A 1924-29 “.

Senator FOLL:
Acting Leader of the Opposition · QUEENSLAND · NAT; UAP from 1931

. -It has been brought to my notice that the rate of interest shall be an assumed rate of 4 per cent. per annum. Three per centum per annum should be substituted for the following reasons : -

The minimum actuarial valuation basis is a type of Sprague valuation providing for an assumed interest rate of 4 per cent. The Sprague valuation, in effect, means that the large per centum of the liability for the first year is ignored and is made up in the subsequent year or years. All leading insurance offices in Australia to-day value on a pure net premium basis, which means that the full actuarial liability is provided for at the end of each year, including the first year. In view of the reduced interest earnings on funds, the interest rate provided for under the present bill is too generous, and should not be more than 3 per cent. at any time. Government loans which are the main life assurance companies investments, show, after allowing for taxation, a net return of under 3 per cent., and the possibility that this return may decrease in the future, is all the more reason why the provision for interest rate for the actuarial valuation, should he not higher than 3 per cent.

In addition to valuing on a net premium basis, most of the leading offices to-day assume an interest rate of 2½ per cent. to 2¾ per cent., and those that use the 3 per cent. basis make an additional internal reserve, which practically reduces the interest rate assumed to a good deal less than 3 per cent.

Senator Keane:

– This is a concession to the weaker companies, but the basis becomes much stronger after ten years.

Schedule, as amended, agreed to.

Fifth Schedule agreed to.

Sixth Schedule-

Rules for ascertaining the surrender value of a policy in certain cases for the purposes of Division 4 of Part IV. of this Act.

The surrender value of a policy at any date shall be the present value (according to the contingency upon which the policy is payable) of the amount of the paid-up policy which would be granted as at that date, determined according to the Rules set out in Part I. of this Schedule, or the amount payable at death if death were to occur at the date as at which the surrender value is calculated, whichever is the less.

For the purposes of the last preceding rule -

interest shall be assumed at the rate of Five pounds per centum per annum;

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That, in sub-paragraph (a) of paragraph 2 of Part II., after the word “ annum “ the following words be inserted: - “or at such other rate as is prescribed”.

In changing financial circumstances it may be desirable to vary a rate of interest used in calculating surrender values. The power to vary this rate of interest ‘by regulation is contained in the Victorian acts that are the basis of the surrender value provisions of this bill.

Amendment agreed to.

Schedule, as amended, agreed to.

Seventh Schedule agreed to.

Title agreed to.

Bill reported with amendments.

Standing and Sessional Orders suspended ; report adopted.

Bill read a third time.

Sitting suspended from 6.58 to 8 p.m.

page 4804

COMMONWEALTH ELECTORAL (WAR-TIME) BILL 1945

Assent reported.

page 4804

COMMONWEALTH PUBLIC SERVICE BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That the hill be now read a second time.

The Re-establishment and Employment Act provides for the establishment of a Commonwealth employment service. If honorable senators will refer to section 47 of that act, they will see in some detail a description of the functions of the employment service. As was expressed in the White Paper onFull Employment, it is the Government’s intention to develop, in the shortest possible time, an employment service to provide a free service of the highest calibre to employers and workers. It will be an integral part of the Department of Labour and National Service. Time is a vital factor because the service must be functioning before demobilization if it is to play a significant part in the rehabilitation of discharged service personnel and the reestablishment of civilian war workers. The demands on the service at that time will be very heavy. The employment service will, however, be a continuing instrument and a most important piece of machinery in the fulfilment of the Government’s plans for maintaining a high level of employment in Australia. In considering the means which should be adopted to set up the employment service, the Government concluded that there was already at hand an organization which, with development and suitable modification, could be moulded into an employment service. I refer to the National Service Office organization, which, in addition to discharging purely man-power functions, is, in fact, already discharging some of the functions of an employment service. In particular, a special rehabilitation section has been developed as an integral part of the whole organization to deal with the employment rehabilitation of discharged service personnel. These, with the exception of those specifically released to undertake work of high priority, whose rights are nevertheless preserved, are assisted to the utmost extent in finding employment suitable to their qualifications, experience, aptitude, physical conditions and personal circumstances. That is the function of an employment service. When it became necessary after the outbreak of the Pacific war for the Commonwealth to set up an organization to mobilize all our labour resources, the States very generously made available to the Commonwealth the services of a number of State officers then engaged in labour exchange work and associated with labour departments. They also seconded to it a limited number of experienced officers who had special qualifications or administrative experience fitting them for the work to be undertaken. All of these officers have, over the course of the last three years or more, acquired valuable experience in employment work and the Government considers that the Commonwealth cannot afford to lose this experience at a time when it has made the development of a Commonwealthwide employment service a matter of major policy. Accordingly, it proposes to make provision for the appointment to, or employment in, the Commonwealth Public Service of the State officers and employees concerned, and this bill makes that provision. Representatives of the Commonwealth recently met representatives of the State Governments under the chairmanship of the Minister for Post-war Reconstruction (Mr. Dedman) and discussed the terms upon which the State officers might be so appointed or employed. This bill, in conjunction with the bill to amend the

Superannuation Act, which has already been passed, is in conformity with the arrangements discussed at that conference.

What this bill provides for is the appointment to the Commonwealth Public Service of permanent State officers now engaged in the performance of certain defined duties in or for the Department of Labour and National Service. It also provides for the employment in the Commonwealth Public Service in a temporary capacity of those temporary State employees mentioned in the bill similarly engaged and it converts the status of certain other temporary employees appointed by the Director-General of Man Power into that of temporary Commonwealth public servants.

Let us consider first the permanent officers. Those who will be eligible for appointment in a permanent capacity in the Commonwealth Service will be those State officers who have been performing im, or on behalf of, the Department cif Labour and National Service, duties in relation to the organization of manpower, or the placing or rehabilitation of persons in employment and matters related thereto. Others who will be eligible for permanent appointment will be State officers who are members of the forces and would otherwise, in the opinion of the Public- .Service Board, have been performing similar duties, and State officers who, in the opinion of the Public Service Board, would be without positions in the State Public Service because of the establishment of the Commonwealth Employment Service, or of the carrying out of the Unemployment and Sickness Benefits Act. Those eligible for temporary employment in the Commonwealth Public Service are those temporary State employees of similar classes of eligibility who were employed in the State services before the 31st January, 1942.

Clause 6 deals with the continued temporary employment by the Commonwealth of the temporary employees appointed by the Director-General of Man Power, including those who were appointed under the machinery of the State Public Service Acts after the 31st January, 1942, specifically for the purpose of secondment to the directorate. Those employees, though technically tem porary State public servants, are really in no different position from those appointed by the Director-General directly. The temporary employees dealt with by the clause are really already Commonwealth employees, and all that the clause does is to pass them from the jurisdiction of the Director-General from a staffing point of view to that of the Commonwealth Public Service Board.

One of the most important features of the bill is that no State employee, as defined in the proposed new section 81a, will be appointed or employed in the Commonwealth Public Service unless he so elects. The proposed section 81b deals with this. The Public Service Board is drawing up a staff establishment for the Commonwealth Employment Service, and what is proposed is that each State employee will, when being requested to elect, be advised of the classification of, and the remuneration payable and the conditions generally applicable in respect of the proposed appointment or employment. There will be no alteration of the State employees’ status on their becoming Commonwealth public servants. Thus, permanent State officers will become permanent Commonwealth officers, and temporary State employees will remain temporary employees on transfer to the Commonwealth. State officers will be appointed to the division of the Commonwealth Service equivalent to that in which they were employed in the State Service. Because of special experience and qualifications, and because they will be needed to undertake similar work to that performed in the State Service, some State general division officers, who will thus automatically become Fourth Division officers in the Commonwealth, may be allotted to positions normally classified in the Third Division. However, all this will be made clear to the State employees, and it will be for each to weigh the question whether ‘he should transfer or stay with the State. Subject to the provisions of the bill, when once the officer or employee becomes a ‘Commonwealth public servant, he will be, for all purposes, subject to the provisions of the Commonwealth Public Service Act and regulations as though he had been appointed in the normal way.

In setting up its employment service the Commonwealth is undertaking what has previously been regarded as a function of the States. I need not repeat the reasons moving the Government to decide to establish its own Australia-wide service. The point I wish to make now is that because the Commonwealth is assuming these functions the bill must make provision to remove any hindrance to the transfer to the Commonwealth, of the State officers previously engaged in the State services in the performance of these functions, as well as of those other State officers who have over the past three or more years gained specialized experience of employment matters which we cannot afford to lose. Accordingly, provision has been made in the proposed section 81e for the non-application of any preference law to the appointment or employment of the State employees defined in section 81a. What this bill really does is to enable a limited number of State public servants who have been on loan to the Commonwealth for a number of years, and those other State servants defined in section 81a, to become Commonwealth public servants. The States themselves want this secondment arrangement finalized so that they can adjust their own staffing position. Moreover, without these State servants the Commonwealth .would experience difficulty in establishing its employment service within the time available. The officers concerned constitute only the nucleus or core of the organization that will be required, and’ the preference lawwill apply to any appointments to the Commonwealth Public .Service of any other persons who may ultimately be needed to staff the employment service.

The bill also provides for the preservation, after appointment or employment in the Commonwealth Public Service, of the basic rights and privileges that the State employees possess. The proposed section 81f gives a guarantee that, after they become Commonwealth’ public servants, they will not be any worse off from the remuneration point of view than they would have been in the State service. Employees on incremental scales are covered by this section. Necessary qualifications to this guarantee are expressed in the section. The bill also makes provision regarding continuity of State with Commonwealth service, preservation of accrued recreation leave and certain furlough entitlements regarding such leave. In all, the Government believes that the conditions set out in this bill, which must be considered in conjunction with the amending Superannuation Bill to which I have already referred, are generous. The object has been that, as the successful establishment and development of the Commonwealth Employment Service is largely dependent on the Commonwealth acquiring the bulk of the State servants eligible under the bill, the conditions to apply to their transfer should be at once such as would be fair and equitable to all parties affected and not repel State servants when considering whether to elect to transfer. At the same time, honorable senators will appreciate that we have to obviate the creation of internal staffing- problems and anomalies within the Commonwealth Public Service by introducing a group of officers with special privileges. And so, subject to the special provisions of the bill to which 1 have referred, when once the State officers become Commonwealth public servants following their election to resign from the State services, they will, as T have already stated, be in just the same position as all other Commonwealth public servants.

Senator COLLETT:
Western Australia

– As indicated in the secondreading speech of the Minister for Trade and Customs (Senator Keane) this bill is related to the Superanuation Bill with which the Senate has already dealt. The Opposition has no objection to the bill but in committee I shall have some comments to offer in regard to clause 5.

Senator FINLAY:
South Australia

– In his second-reading speech the Minister for Trade and Customs (Senator Keane) said that certain classes of persons will be eligible for appointment in a permanent capacity to the Commonwealth Public Service. I should like him to indicate clearly whether the rights of the men now with the fighting services are protected.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– I should like the Minister, when replying to the second-reading debate, to indicate what is likely to be the effect of this bill on State employment bureaux. I understand that there is some conflict of opinion between governments of the Commonwealth and the States, particularly the Government of Queensland, regarding the establishment of permanent Commonwealth employment bureaux. In the early period of demobilization, much additional machinery will be required so that the fullest information may be made available as to where jobs can be obtained. Some of the States have efficient employment services at present. Mr. Hanlon, the Acting Premier of Queensland, was averse to the Commonwealth authorities taking over from the Government of Queensland the employment bureau which operates in various parts of that State. During the war period, many public servants, as stated by the Minister in his second-reading speech, were seconded by the Commonwealth Government for duty in connexion with the Man Power Directorate, but it would be inadvisable to have labour bureaux established by the States competing with that to be inaugurated by the Commonwealth. The Minister said that these conditions operate to some degree as the result of arrangements made by the States, but will thebureaux of the States which certain State governments do not desire to surrender operate in competition against the proposed Commonwealth organization? I hope that the Minister will clarify the position.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

in reply - The only States in which State employment bureaux operate are New South Wales and Queensland. An arrangement has been made by which there will be no duplication in New South Wales, as the authorities in that State are prepared to vacate that field. In Queensland there is a similar organization, and conversations are now taking place with a view to action being taken there similar to that in New South Wales, but no finality has yet been reached in the matter. Queensland desires to retain its own organization. The object of the Government in this bill is to obtain a single employment autho rity, and I regard the proposal as an excellent one.

Question resolved in the affirmative.

Bill read a second time.

In committee:

Clause1 - (2.) Section twenty -three ofthe Reestablishment and Employment Act 1945 is amended by omitting sub-section (6).

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.-I move -

That, in sub-clause (2.), the words “omitting sub-section (6.), “ be left out, with a view to insert in lieu thereof the following words: - “inserting in sub-section (6.), after the word ‘ amended ‘ the words ‘ by the Commonwealth Public Service Act 1945 and ‘ “.

When this bill was drafted it was assumed that the Re-establishment and Employment Act would be in operation before this measure came into force. However, that act has not yet been proclaimed to commence, and it is therefore necessary to make this amendment so that the citations of this bill will be in proper form.

Amendment agreed to.

Clause further consequentially amended and, as amended, agreed to.

Clauses 2 to 4 agreed to.

Clause 5 (Interpretation).

Senator COLLETT:
Western Australia

– Sub-section1 of proposed new sub-section 81e states -

The provisions of any law of the Commonwealth providing for preference in any matter relating to the employment of discharged members of the Forces shall not apply in relation to the appointment or employment of State employees under this Division.

I assume that the inauguration of the employment service contemplated under his measure will result in the establishment of a new department arising out of circumstances created by the war. In order to man this department in the first instance, certain transfers are to be made more or less en bloc from the State Public Services. The appointments will be permanent in some cases, and temporary in others. Are we to understand that the temporary employees may be replaced by ex-servicemen when the latter become available, and that permanent employees may be similarly replaced? Am I to understand further that this will he only the nucleus of a very much larger department? If that be so, will appointments be reserved for ex-servicemen? I am concerned that soon after the passage of the Ee-establishment and Employment Act, the Government is presenting legislation which specifically prevents the granting of preference to servicemen. This action is likely to lead to grave misunderstanding, and I trust that the Minister in charge of the bill (Senator Keane) will explain the intentions of the Government in the matter.

Senator BRAND:
Victoria

.- After reading proposed new section 81b, it seems that State public servants are to be transferred to the new Commonwealth Employment Department. Sub-section 1 of the proposed new sub-section states that the provisions of any law of the Commonwealth providing for preference in any matter relating to the employment of discharged members of the forces shall not apply in this case. Hundreds of State public servants are now serving in the forces, and if preference is not given to them in connexion with the proposed transfers what will happen to them on their return to civil life? I apprehend that State servants who are now to be transferred will be given a new status and higher salaries, whilst men now serving overseas will be prevented from acquiring that status and will be deprived of opportunities for promotion. Something should be done to safeguard the’ interests of State employees now serving overseas. I should say that a public servant could learn the duties of a manpower official in a couple of weeks. It is nonsensical to say that the persons now employed are the only men who could do the work required of officers of the Commonwealth Employment Service. The proposed new sub-section 81e should be recast.

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.- The number of men to which the bill will apply is 270. Some of them are already permanent employees in State services and in their case, the question of preference does not arise, because they are being transferred to permanent positions similar to those which they are leaving.

Senator Collett:

– Will they retain their existing rights?

Senator KEANE:

– Yes. A section of the men who will be transferred will be temporary employees, and they will retain their existing rights. The staff of 270 men is only the nucleus of the big staff that will be eventually required, and full preference to ex-service personnel will be observed with regard to all future appointments. The men to be transferred are skilled in the class of work required of them. Capacity, personality and ability to handle men under most annoying conditions will be required of these officers. More complaints are dealt with by man-power officials than by officials in any other government activity, and in many instances the complaints are due to the individual officers concerned not possessing the personality required in dealing with men. When general demobilization is commenced, one of the key jobs of the government of the day will be to see that lil- work is effectively done, and that men returning to industry are dealt with in such a way as to make the organization operate smoothly. This clause has been inserted to ensure that certain men employed in the State services shall be transferred to the Commonwealth as soon as their services can be secured.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– The Minister for Trade and Customs (Senator Keane) has pointed out that the men to be transferred to the Commonwealth Public Service constitute only the nucleus of a very large staff. Members of State Public Services who have been doing this work, and who are to be transferred to the Commonwealth Service, will, quite properly, retain their accruing rights. A number of other men are only temporary employees. Is the Government disseminating information about this new department in the ranks of the fighting services, particularly amongst men likely to become eligible for release under the plan for the release of personnel with five years’ service, and under the other scheme for the reduction of the fighting strength of the land forces to three divisions? Some of the men eligible for release under the Government’s proposals are dubious about accepting discharge, unless they know what jobs will be offering on their return to civil life. Where new Government departments are being established, steps should be taken to make known to members of the fighting forces that vacancies will arise in those departments. Many men with five years’ war service are naturally anxious for discharge, and I think that they should be automatically released. Numbers of them have not accepted the Government’s offer because they consider that by doing so they might be letting their mates down, but I consider that a man who has rendered five years’ service, including two years’ service overseas, is, apart from sentimental considerations, well entitled to release. Thousands of these men are not quite sure whether they want discharge or not, because they do not know what employment will be available to them on their return to Australia. In cases like this we should let the men in the services know what opportunities are offering in new departments. It could be done very well with the assistance of the Army authorities.

Senator COLLETT:
Western Australia

. -I think the Minister appreciated the force of my representations, and in his reply he stressed the need for appointing to this department officers with knowledge and personality. Some of the men who come back after a period of service will need handling in a special way, which is within the knowledge only of men who have themselves served. I stress the need for staffing the department with such men.

Senator Brand:

-Can the Minister say whether these State public servants will be employed temporarily or permanently ?

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.Permanent men will be permanent and temporary men will be temporary. Thirty-five per cent. of the 270 officers to be transferred are returned men, and form part of the nucleus staff in this department. It is estimated that we shall require altogether 1,500 men. In the appointment of staff other than State officers, the principle of preference to returned servicemen will be applied.

Senator BRAND:
Victoria

.- Speaking in this chamber about two months ago, I stated that there were 167 officers in the Department of Postwar Reconstruction drawing salaries of £500 a year and more, and of that number only 31 were returned soldiers of the last war or of the present war. I do not know how the Minister arrived at his estimate of 35 per cent.

Senator Keane:

-The figures which I cited just now apply to the Department of Labour and National Service, not to the Department of Post-war Reconstruction.

Senator MATTNER:
South Australia

– The Government proposes to take from the States 270 officers for this department and the Minister said that it is proposed eventually to build up the staff to 1,500. Will the additional officers also be taken from the States?

Senator Keane:

– No.

Clause agreed to.

Clause 6 agreed to.

Title agreed to.

Bill reported with amendments; report adopted.

Bill read a third time.

page 4809

SCIENCE AND INDUSTRY RESEARCH BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

. -I move -

That the bill be now read a second time.

As at present constituted by the Science and Industry Research Act 1926-1939, the Council for Scientific and Industrial Research consists of three members nominated by the Commonwealth Government, one of whom is the chairman; the chairmen of the six State committees, and other members co-opted by reason of their scientific knowledge. The three Commonwealth Government appointees form an executive committee, which exercises all the powers and functions of the full council in the intervals between its meetings.

The activities of the Council for Scientific and Industrial Research have necessitated a widespread and adaptable organization. Undesirable centralization has been avoided in two main ways. In the first place, the policy has been followed of establishing laboratories in different places in the Commonwealth where the necessary facilities, contacts, and other suitable conditions could best be found. Secondly, a State committee, widely representative of scientific and industrial interests, has been established in each of the six States. These committees advise the council on general matters, and on particular subjects of investigation and research. For about twelve years after its establishment, the work of the Council for Scientific and IndustrialResearch was devoted mainly to the solution of problems affecting the agricultural and pastoral industries. Unlike manufacturing concerns, which often can employ their own scientific staffs, the farmer and the pastoralist are dependent on outside help for the solution of their problems which require research. It was a recognition of the greater need of the primary producer which directed the council’s early policy. However, in 1937, the Commonwealth Government decided to extend the activities of the Council for Scientific and IndustrialResearch so as to provide assistance to secondary industries, and the council proceeded to establish several laboratories for work in that field. It was thus in the fortunate position of being able to render to these industries assistance of vital importance almost immediately after the outbreak of war. In fact, the remarkable technological advances and developments in secondary industrial production during the war would, to a large degree, have been impossible had it not been for the assistance rendered by scientific research, and this may well serve as a forceful illustration of what may be accomplished in times of peace.

For the purpose of carrying out its research work, the council has established a number of divisions and sections. The divisions, of which there are now twelve, comprise the major establishments for which special laboratory buildings have been erected and equipped; the sections generally include establishments which have not reached a stage of development, so far as the scope and magnitude of their operations are concerned, that would justify their designations as divisions As the council’s investigations are on a Commonwealth-wide basis, and as many of the investigations being conducted - particularly those concerned with problems affecting the agricultural and pastoral industries - necessitate experimental work in the field, a number of field stations has been established in various parts of Australia. The divisions established are -

  1. Plant Industry, with main laboratories at Canberra and field stations.
  2. Economic Entomology, also with main laboratories at Canberra and field stations.
  3. Animal Health and Production with main laboratories in Melbourne and Sydney and field stations.
  4. Biochemistry and General Nutrition, with main laboratories at Adelaide and field stations.
  5. Soils, also with main laboratories as Adelaide and extensive operations in the field.
  6. Forest Products, with main laboratories in Melbourne and field experiments.
  7. Food Preservation and Transport, with main laboratories at Homebush, New South Wales, and a subsidiary laboratory in Brisbane.
  8. Fisheries, with main laboratories at Cronulla, New South Wales, and experimental work in coastal waters of Australia.
  9. National Standards Laboratory at Sydney.
  10. Radiophysics Laboratory, with main laboratory at Sydney and subsidiary laboratory at Melbourne with operational research groups.
  11. Aeronautics, with laboratories in Melbourne.
  12. Industrial Chemistry, with laboratories in Melbourne.

The following are the sections: -

  1. Research Station, Murray Irrigation Area, Merbein, Victoria.
  2. Irrigation Research Station, Griffith, New South Wales.
  3. Lubricants and Bearings, Melbourne.
  4. Dairy Products, Melbourne.
  5. Mineragraphic Investigations, Melbourne.
  6. Ore-dressing Investigations, Melbourne.

Adelaide and Kalgoorlie.

  1. Building Materials Research.
  2. Section of Mathematical Statistics.
  3. Information Section.
  4. A section for Council for Scientific and Industrial Research activities in Tasmania will shortly be established there.

Since 1926, Sir George Julius has presided as chairman of the council, and during the nineteen years that have elapsed the council has developed into a great organization, with ramifications into almost every sphere of scientific research. That is a comparatively brief period as the lives of scientific institutions go, but a vital one in the scientific and industrial development of Australia. The council has achieved a distinguished place among the scientific institutions of the world. This is an achievement of practical importance in the lives of all Australians, without which the Commonwealth as a nation could not have played the part that it has played, and that it will play in war and peace - a part which future historians will record among the significant factors in our history.

Advice has been received from Sir George Julius that he considers that the time has arrived when he should relinquish the position of chairman of the council. Sir George’s retirement will probably take place at some time during the present year. Appreciation of his devotion to duty and of the supremely important results which the council has achieved during his term of office has been conveyed to him. The retirement of the first chairman of the council coincides with the time when we must prepare for the important task of applying to the problems of peace and post-war reconstruction the scientific organization and experience gained by the Council for Scientific and Industrial Research, and applied so successfully to the problems of war. The need for the application of scientific knowledge in both primary and secondary industries will be greater than at any time in Australia’s history. Australia will be facing a new world, full of industrial surprises, and of scientific and technical developments unthought of a few years ago. During the war, government authorities and industrial undertakings have learned to rely more than ever before on the help of the scientist. In the post-war period, the Government, as well as industry, will be even quicker to recognize the role which science in general, and the Council for Scientific and Industrial Research in particular, must play in solving the problems on which Australia’s future development depends. The Council for Scientific and Industrial Research must be more than a great scientific institution ; it must be an integral unit of industrial society, and must play an important part in public education. It must foresee the problems which cry out for solution, and must maintain close contact with the departmental or industrial authorities that have problems that need to be solved.

Having regard to all the circumstances of the case - the impending retirement of the council’s first and only chairman, the wide ramifications of the council’s work, and the part which it is being called upon to play in post-war reconstruction and development - it is desirable that the organization of the council should be modified so as to enable it to maintain a close contact between the day-to-day direction of its work and the developments which are tn.ring place outside in industry, in the universities and elsewhere. This can be achieved in two ways: first, by increasing the number of members of the council, and secondly, by appointing additional members to the executive committee. As regards the council, the Science and Industry Research Act already provides that the council may, with the consent of the Minister, co-opt additional members by reason of their scientific knowledge. After consulting the council, consent has recently been given to the co-option of’ four additional members.

The number of members of the executive committee cannot, however, be increased without an amendment of the act. The appointment of two additional members, increasing the number from three to five, as provided in this measure would not only facilitate closer contact with activities in the world of affairs but would have the additional advantage that it would permit of a distribution of the burden which has grown increasingly heavy in recent years. Moreover, it would, in the long-term view, provide a larger reservoir of experience to meet the changes which must, inevitably arise when other members of the present executive retire, thus maintaining continuity in the direction of the council’s work. The council has been consulted on this matter, and concurs in the view that an increase of the number of members of the executive committee is desirable. The amendment contained in the bill is in itself a small thing, but it symbolizes the successes of the Council for Scientific and Industrial Research to date, and is an earnest of wider efforts and achievements to come.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– The Opposition will support the bill, and facilitate its passage. I and my colleagues desire to be associated with the very fine tribute which the Minister for Trade and Customs (Senator Keane) has paid to the Council for Scientific and Industrial Research in respect of the work it has performed since its inception, and also with the tribute to the Chairman of the Council, Sir George Julius. Those who have had any association with the Council for Scientific and Industrial Research are aware of the admirable work which Sir George has performed since the establishment of that body. Under his able chairmanship, assisted by the executive ability and scientific knowledge of Sir David Rivett, the organization has played a remarkable part in the development of our primary and secondary industries. Therefore, the Opposition endorses the tributes paid by the Minister to the Council for Scientific and Industrial Research and its officers.

I take this opportunity to remind the Minister for Trade and Customs of a series of questions which I have asked, regarding any action taken by the British and Allied Governments to carry out scientific investigations in Axis countries now under control of the Allies. Immediately the army of occupation advanced into Germany and the guns ceased fire, many scientists from Great Britain and allied countries, including Canada, were on the spot to investigate secret formulas and patents held by Germany and Austria. German chemists and engineers were among the most brilliant in the world. I believe that the reparation which Germany must make to those countries which it so ruthlessly attacked should include the disclosure of its valuable scientific formulas and patents, and that these, regardless of the international protection they were formerly accorded, should be made available to the world at large. I emphasize that Australia should associate itself with the investigations now being made by scientists overseas to secure these Ger man scientific formulas. Otherwise we shall find that they will be taken over by other nations, and, probably, we shall be obliged to pay royalties should we require to use them. Germany led the world in the dye industry, for instance, its secrets in that industry being unknown in any other country. Those and other secrets should now be freely made available to the rest of the world. I mention these matters in view of the statement by the Minister, with which I agree, that science is bound to play an increasingly important part in the development of our primary and secondary industries.

Senator GIBSON:
Victoria

.- The Council for Scientific and Industrial Research was established by the BrucePage Government which made available the sum of £500,000 for that purpose. Since its foundation the council has done exceptionally good work in the interests of our primary and pastoral industries. The council will require to augment ite staffs for station work, because much of its research in respect of animal husbandry is now centred in its laboratory in Melbourne. It will be necessary to undertake intensive research in the field of soil analysis, particularly with respect to the deficiency of minerals in our soils. Great developments have resulted since the introduction of superphosphate many years ago, and this progress can be supplemented very substantially by increased knowledge on deficiencies in soils. It is known, for instance, that cobalt and sulphate of copper, applied in small quantities, render grasses more palatable and nutritious for stock. The Minister for Trade and Customs (Senator Keane) in his second-reading speech said that the Council for Scientific and Industrial Research will extend its investigations into secondary industry. Tremendous scope exists for such work. Already, secondary industry is benefitting from discoveries made during the war, and the Council for Scientific and Industrial Research is the proper body to consolidate that progress. I believe that it will do as good a job for secondary industry as it has already done in the interests of primary industry. I support the bill.

Question resolved in the affirmative.

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

page 4813

COMMOWEALTH INSCRIBED STOCK BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

– I move -

That thebill be now read a second time.

This bill seeks to amend the Commonwealth Inscribed Stock Act 1915-1943 to provide for -

  1. the widening of the exemption from stamp duty now applying to Commonwealth loans;
  2. alteration of the conditions of acceptance of National Savings Stamps in payment of loan subscriptions; and
  3. facilitating the transfer of stock held on account of estates of deceased persons.

Opportunity is also being taken to cut out some dead wood from the principal act and to make some minor amendments which experience has shown to be necessary. Exemption from stamp duty is already given by section 52a of the act to documents relating to the purchase, transfer, or transmission of Commonwealth securities, but documents relating to the conversion or redemption of securities are not accorded this protection. Amendment of this section on the lines proposed will remedy this omission. Provision is also made for documents, cheques and drafts relating to the payment of interest to be exempted from stamp duty. Where payment of interest is made by Commonwealth cheque, payment of stamp duty does not arise, but where Commonwealth securities are lodged with the trading banks for safe custody, arrangements are made for such banks to pay the interest on such securities on behalf of the Commonwealth. It is anomalous that drafts and other docu ments used by the banks in making such payments on our behalf should be liable for stamp duty, while similar instruments issued by the Commonwealth itself do not attract stamp duty. If this is not corrected, some holders of Commonwealth securities will pay stamp duty on their interest cheques, whilst others will not. This amendment of section 52a is necessary to give to Commonwealth securities the full exemption from stamp duty which it has always been intended they should have.

An alteration is required in section 57a of the principal act which governs the acceptance of National Savings Stamps in payment for treasury-bonds or stock. Under this section as it now stands such stamps may be accepted in part payment of loan subscriptions if their face value is £2 or a multiple of £2. Since this provision was made, it has been decided to accept instalments in respect of subscriptions to loans at the rate of £1 per month and an amendment of. the act is necessary to enable these instalments to be made by means of National Savings Stamps.

Another amendment relates to stock which forms part of the assets of a deceased estate. The act at present provides that where a transmission of stock has to be effected in consequence of death, probate or letters of administration must be produced to the Registrar of Inscribed Stock. This condition may be waived where the face value of the stock doea not exceed £100 in amount, but it happens from time to time that there is no will, and although the estate may consist of more than £100 in stock, the total assets are so small as not to justify taking out letters of administration, or the estate is being administered by a public trustee or other such officer. The proposed amendment is for the purpose of enabling the Registrar, in such cases, to accept other evidence of authority to administer an estate, and thus make it more convenient to deal with stock held on account of small estates.

Division 4 of Part III. of the principal act relates to the issue of stock certificates to bearer. This division is redundant; it has never been used as it has not been found necessary to issue this type of security. Flexibility in dealing with stock is achieved by the arrangement under which stock and treasurybonds, which are payable to bearer, are interchangeable. It is considered,’ therefore, that this portion of the act should be repealed. Other amendments are of a minor character and are either machinery or administrative provisions.

Senator FOLL:
Acting Leader of the Opposition · Queensland

– The Opposition has no criticism to offer of the measure. “We shall facilitate its passage.

Question resolved in the affirmative.

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

page 4814

NATIONAL DEBT SINKING FUND BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

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

Second Reading

Senator KEANE:
Minister for Trade and Customs · Victoria · ALP

.-] move -

That the bill be now read a second time.

In 1927, when the Financial Agreement was implemented, Australian and sterling currencies were at par, or, in other words, the Australian £1 was the equivalent of the £1 sterling. It was only in 1931 that the Australian £1 suffered heavy depreciation. Substantial variations of the exchange rate between Australia and London and New York were never contemplated when the National Debt Sinking Fund Act or the Financial Agreement was brought into operation and contributions to the National Debt Sinking Fund on either Commonwealth or State debt have continued to be made on the basis of the mint par of exchange as existing prior to 1931.

With the amendment of the Financial Agreement in December last, provision was made that the sinking fund contributions prescribed by that agreement shall be calculated on the basis of the mint par of exchange prevailing on the 1st July, 1927, the date from which the original agreement took effect. The

National Debt Sinking Fund Act prescribes the contributions which shall b<; made to the National Debt Sinking Fund in respect of Commonwealth debt It is now -deemed desirable to bring the provision in that act in respect of contributions on overseas debt into line with the Financial Agreement.

The proposed amendment in clause 1 of this bill, as in the case of the similar amendment to the Financial Agreement, will validate the practice which has been followed for years of calculating sinking fund payments on Commonwealth overseas debt in Australian currency. Clause 3 proposes to delete two sub-sections of section 9 of the original- 1923 act, which require the payment to the National Debt Sinking Fund of one-half of the ne profits derived by the Commonwealth Bank. These sub-sections are superfluous, as adequate provision in this respect ha? been included in the Commonwealth Bank Act for several years.

I commend the bill to the favorable consideration of honorable senators.

Question resolved in the affirmative.

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

page 4814

AUSTRALIAN NATIONAL AIRLINES BILL 1945

Bill received from the House of Representatives.

Standing and Sessional Orders suspended.

Bill (on motion by Senator Cameron read a first time.

Second Reading

Senator CAMERON:
PostmasterGeneral · Victoria · ALP

– I move -

That the bill be now read a second time.

In introducing this bill for an act to provide for the establishment and operation of National Airline Services by the Commonwealth, I contend that the proper approach to this highly important question should be - First, is it in the interests of the people as a whole? Secondly, is national ownership and control of civil airlines preferable to a private monopoly? These are the real questions to be considered. We should be clear in our minds and understand that to-day, Australia, in common with every other responsible nation in the world, is on the threshold of the air age. To understand that is to admit that the debate must go far beyond any question of petty party politics.

There should be no need for me to emphasize that aviation is intensely vital to-day as a national instrument; that, inevitably, it is a part of the very core of the economic, social, diplomatic and defence policy of the nation. That vital truth has been proved beyond all question in the exigencies of war. And, if we are to prosper as a nation and play our part worthily in world affairs, it must find full expression in the peace that is to follow. There is little doubt that the end of the war will see a considerable development in civil flying. War, tragic as it always is, has in aviation, as in many other developments, accelerated the rate of progress in engineering and scientific development. Every nation which hopes to maintain any place in the world of to-morrow must take full advantage of the technical and scientific progress achieved during the war, and make full use of their application as instruments for peace.

The civil aviation industry in Australia during this war has performed magnificent service. Civil aircraft and civil aircrews have been used in war zones to aid our own forces and those of our great ally, the United States of America, in many perilous undertakings. Many of the air transport services required by our Allies have been performed wholly by civil aircrews; and many civil aviation personnel joined the Royal Australian Air Force, providing a readytrained nucleus. I mention this to indicate the importance of civil aviation in the air strength of the nation. For a considerable period in the Pacific war, Australia was a major operational base. Because of this, the Government was compelled to provide, at great cost, facilities of all kinds all over the Commonwealth in the form of airfields, landing -trips, hangars and workshops. The meteorological services which, before the war. were comparatively insignificant, have been expanded to cover the whole comment and the islands to the north. New radio and navigational aids have been installed, employing the latest type of equipment and, whilst the programme mapped out has not yet been completed, airways in Australia, where this equipment has been installed, compare favorably with any overseas. Most of this work was due to the imperative needs of war. It represents a very large capital outlay. Fortunately, much of it will be of value in the post-war development of the internal air services.

If the bill is examined dispassionately, it will be seen as a measure comparable to those which gave Australian governments control of the postal services and the railways. There is no basic difference between these essential services, and the operation of a system of airlines. An argument, very widely publicized by opponents of this measure, is that a3 the Government’s referendum proposals were defeated last year, and as one of these proposals wa3 for Commonwealth control of air transport, the Government, in proposing this measure, is acting in defiance of the expressed will of the people., This is not in accordance with the facts. Those who charge the Government with a breach of faith overlook the all-important fact that the Commonwealth has always had power over interstate air transport, and that this powerwas not affected by the failure to carry the referendum. It was not a part of the submission to the people. Had the referendum been successful, this legislation would, in all probability, have covered intra-state as well as interstate airlines; but as the powers sought were not granted the legislation has been drafted within constitutional limitations.

Before I analyse the contents of the bill, I desire to return to the wider national issue. The Government, being realistic, recognizes civil aviation as a national instrument. In doing so, it is really following a policy which was recognized by the Churchill Government in its White Paper on the subject, issued in March of this year. That document stated -

Air Transport is a service in which the community as a whole has a direct interest. The criterion as to whether a particular route should he flown is not merely : Is it commercially profitable? There are services which are essential in the public interest, but which offer little or no prospect of a direct financial” return. Unlimited competition in the air by private operators would mean that competing services would be concentrated on the remunerative routes; and that the taxpayer, while reaping no benefit from the more lucrative routes, would be compelled to support by subsidies those services which, although desirable for public or social reasons, would initially, at any rate, be run at a loss, and might, in some cases, never show a profit.

The essential point in that statement is the admission that the taxpayers are unable to reap the benefits from lucrative routes whilst paying subsidies. To this, the private airline operators have no effective reply. The British Labour party which, only a few days ago, was charged by the people of Britain in so triumphant a manner with forming a Government, has pledged itself to bring airlines under national control. Lord Swinton, a former Minister for Civil Aviation in the United Kingdom, under whose guidance the White Paper was issued, clearly took a very progressive view of the question. The Sydney Morning Herald staff correspondent in London on the 23rd February reported him as having told a meeting of the Aerodrome Owners Association that the United Kingdom Government regarded no one as having a vested interest in air transport except the travelling public. That was Lord Swin.ton’s view, but I shall go further. This Government insists that the so-called vested interest in air transport, far from being confined to the travelling public, belongs to the entire community. Development of air transport on truly progressive lines, as is proposed in this bill, must inevitably have a far-reaching influence for good on the social conditions which govern the lives of millions of people who may never leave the ground.

Nor was Lord Swinton alone in the British Parliament in his intelligent outlook on this question. During the debate in the House of Lords on the British Overseas Airways Act 1939, the Marquis of Zetland, representing the Government, made this important admission -

In our view, a non-profit-making public corporation set up by statute, will offer greater possibility of advancing British civil aviation than a limited liability company, which must, of course, quite properly, watch its shareholders’ interests and also bc sure of its subsidies and contracts before it can embark on a far-sighted development pro- gramme for the operation of new air services with up-to-date and increasingly costly aircraft.

Taking the other British Dominions as examples, we find that in Canada the entire trunk route system, comparable to the Australian interstate airways system, is under government ownership, control, and operation. In South Africa, all air services are owned and operated by the government. The New Zealand Government has recently announced its intention of nationalizing the whole of the Dominion’s airlines.

Now, let me outline what the Government sees as the real issues. There are four - the economic obligation, the social obligation, national development and national defence. The Government’s economic obligation raises questions on which there have been the greatest misrepresentations. Foremost among these is the very vital matter of the degree to which private airline operators rely on government subsidy for profitable operation. In the main, the basis of all the arguments in opposition is the claim that major airlines now operate entirely without subsidy and that they, in fact, return a substantial profit to the Treasury. These statements ignore entirely the Government’s contribution to airline operations by the provision, maintenance and operation of aerodromes, radio and navigational aids, lighting facilities and meteorological services, all free of charge to the operators. The Government has more capital’ invested in these facilities than is represented by the entire equipment of all the Australian airline companies. However, leaving this major contribution out of the calculation, it can be demonstrated that payment for the carriage of mails on a poundage basis at the present rates constitutes a subsidy to the extent of at least 50 per cent, of the payment made. The fact that current mail poundage payments are a disguised subsidy is recognized by impartial authorities on the economics of air transport, prominent among them being Oliver J. Lissitzyn, from whom I shall quote. Mr, Lissitzyn is a. research fellow of the Council on Foreign Relations of the United States of America, which is equivalent to the Royal Institute of International Affairs in Great Britain. His’ work on the economics of civil aviation entitled “ International Air Transport and National Policy “ was published by this council. Mr. Edward P. Warner, of the United States Civil Aeronautics Board, himself one of the foremost American authorities on the subject, described Lissitzyn’s study as a notable contribution to the political history of air transportation. Mr. Lissitzyn shows clearly that mail poundage payments at the present rates constitute a substantial disguised subsidy. On page 158 of his work, he has this to say -

American air transport is still dependent on direct governmental assistance, which, although it takes the form of payment for the carriage of mails, in principle is based on deficit covering. Airlines also enjoy extensive aid, the cost and value of which are incapable of precise determination.

The Minister for Civil Aviation (Mr. Drakeford) stated that payments for the carriage of airmail were fixed at a rate which bears no relation to the service rendered. Those who have studied the Government’s case will appreciate that it does not rest on theoretical statements, but upon facts which can be clearly demonstrated. One method by which this contention can be tested is to compare the amounts received by the airline operators for the carriage of different classes of freight. My colleague instanced the wide disparity between the rates charged for the carriage of mail, and that for the carriage of other freights between Melbourne and Sydney. Opponents of the bill made no attempt to explain the reasons for this disparity. It is a point they studiously avoided. To indicate that this was not an isolated and particularly favorable example selected for the Government’s case, I shall now give to the Senate figures showing the average rates charged for the carriage of various classes of freights per lb. mile over the whole Australian airline system for the year 1943-44. They are-

Thus, the companies receive from the Government for the carriage of airmail, three times the amount per lb. mile that they charge for the carriage of passengers or freight. This is in direct contrast to the fact that on the railway services, mail is carried for about one-quarter the rate charged for other freight, and about one-sixth the rate for the transport of passengers.

Seen in cold print, these figures point to an irrefutable conclusion: Payment for the carriage of mails is not based on the value of the service rendered but contains a large measure of subsidy which is one phase of the Government’s contribution to the development and maintenance of civil aviation services; but there is still another aspect of this same question. The Airline Operators Secretariat has widely distributed an advertisement headed “ Subsidy in Reverse “. In this advertisement it is claimed that, though the Government has paid to the airline companies £3,167,000 for the carriage of mails, the Government has received £3,294,000 in return from the airlines in the form of revenue, and thus, to quote this advertisement -

All these payments have been fully returned with a net profit of £127,230 to the taxpayers.

This statement is a complete misrepresentation. The truth is that from this source the Government has not received anything back from the airline companies, The Government’s revenue of £3,294,000 mentioned, is a sum received by the Department of Civil Aviation from the Post Office and not from the airlines. It represents the balance of the amount paid by the people of Australia in surcharges for air-mail letters after the Post Office has deducted its special costs incurred in handling airmail. The amount of surcharge bears no direct relation to the airline operators’ costs, or their remuneration for conveying airmail. It is a tax levied on the public, the proceeds of which pay Post Office costs, contribute to the provision of aerodromes and other facilities for the development of civil aviation, and provide a fund for the payment to the airline operators for their share in the carriage of the mail. Mr. Lissitzyn emphasized this point in discussing the degree of subsidy included in mail payments to American airlines. He said -

The Post Office, for reasons of publicpolicy, may fix the airmail postage rate at such a low level that revenues could not possibly cover the cost of the service. The reverse is also true. The airmail postage rates might be set at a level so high that the Post Office revenues might equal or exceed the payments to the carriers, and yet the payments might include a substantia] amount of aid to the carriers.

During the debate on this measure in the House of Representatives, the claim was made on behalf of the private companies that the rates charged by airmail contractors in Australia were the lowest charged anywhere in the world. It was specifically stated that they were certainly lower than those charged in the United States of America. It is noteworthy that Australian National Airways Limited has also made this claim for its own organization. These claims are not borne out by official figures. The average rate paid in Australia for the year ended the 31st March, 1945, was 0370d. per lb. milo. The latest figures available from the’ United States of America are for the eleven months ended the 30th November, 1944. They indicate that the rate paid by the four principal domestic airline companies averaged 0224d. per lb. mile. It will be seen that the average Australian rate was at least 50 per cent, higher than the average American rate. No figures are available of later payments to the airline companies in America, but it is known that the United States of America Civil Aeronautics Board tentatively reduced the United States of America domestic mail rate from .0225d. to .012d. per lb. mile - effective from the 1st January, 1945 - and the companies have been required to show cause why those lower rates should not be adopted. Even among Australian companies the Australian National Airways rate is not the lowest. For the year ended the 31st March, 1945, their average payment per lb. mile was over half as much again as that paid to one other company operating under a poundage contract and was actually higher than the average rate paid throughout Australia to all airline companies including the directly subsidized operators. It is interesting to note that the rate of .012d. per lb. mile, to which the United States of America Civil Aeronautics Board proposes reduction, is identical with the rate forecast for post-war airmail carriage by Mr. A. B. Corbett, former Director-General of Civil Avia- tion. Apparently, both Mr. Corbett and members of the United States of America Civil Aeronautics Board regard this rate as an estimate of the economic value of the service rendered in the air carriage of 1 lb. of mail per mile.

Recognizing its social obligation, the Government sees urgent need to insist on the development of civil aviation as a valuable counter to centralization. This, coupled with the nation’s migration policy, is of extreme importance. It will help to ensure more equitable distribution of social benefits in keeping with the high standard of living in Australia. This entails the unfettered extension of air mail, passenger and freight services, which can never be brought to their full pitch of national efficiency while the people are deprived of returns from the more profitable routes. The Government bases its conception on a realistic appreciation of the truth that to-day air transport is no longer an end in itself; it is the means to an end - a most vital endprogressive national development. While acknowledging what private enterprise has already done in establishing and maintaining developmental services, T emphasize that such operations have been possible only by virtue of government assistance. It has been claimed that private enterprise could and would equally establish and maintain developmental services, by applying to this purpose profits made on inter-city services. They could, but there is no guarantee that they would, and even though they did, such services would be inadequate. Private enterprise could be expected, at the most, to use only a proportion of profits to that end, whereas a government agencywould not be under the same restraint, and, in fact, under the bill, can. be directed to establish or continue services that the Government considers necessary in the interests of development. If the commission’s profits on its other services are insufficient to meet the lo3S incurred on such developmental services, the Government will make good the deficiency. The constitutional limitations on the Government’s powers to operate airline services will debar the commission from establishing many purely intra-state services desirable in the interests of development. It is hoped that some arrangement will be reached which will result in those services being established and maintained iti the interests of the development of Australia. The Government will be pleased to explore these possibilities further with the other interests concerned.

The third issue concerns national development. War needs have greatly accelerated the development of aviation. This is nowhere more evident than in the size, weight and speed of aircraft and in the elaboration and intricacy of navigational and safety devices. Estimated costs for. necessary development of the main Sydney and Melbourne airports alone exceed £8,000,000, or more than twice the entire pre-war expenditure on :ill Australian aerodromes. That even these figures are very modest compared with expenditure overseas is indicated by the expenditure of about £25,000,000 on New York’s new airfield at Idlewild. As I see it, Australia’s basic problem in civil aviation is this : Over an area comparable to that of the United States of America, we intend to develop a network of modern airlines, but to provide funds for the creation and maintenance of the necessary aerodromes and other ground facilities we have the resources of only 7,000,000 people to draw on compared with 120,000,000 in the United States. I believe that every taxpayer that appreciates this fundamental factor in the Government’s case will wholeheartedly endorse the decision we have reached to take over control of the interstate airlines so that the profits accruing through (he use of these expensive facilities, provided at the taxpayers’ expense, shall go, not into the pockets of private shareholders, but into public revenue for the further development of this great public utility.

The fourth main issue, with which we are greatly concerned and for which the bill is very definitely designed, is national defence. Honorable senators should require little more proof of that than the lessons of the last five and a half years of war. It will, of course, be argued by opponents of the bill that privately-owned airlines can be adjusted to function in war-time. That is true only insofar as existing services can be impressed for war service, but I direct the attention of honorable senators to the pattern of civil aviation as it can be developed under Government ownership. The nationalization of interstate airlines should facilitate co-ordination between civil operations and the Royal Australian Air Force strategic requirements, particularly in regard to types and characteristics of aircraft and engines, development and location of workshops, and facilities for maintenance and overhaul, and in regard to arrangements for temporary interchanges of personnel for training purposes. Government ownership of the main civil airlines will facilitate encouragement of local manufacture of aircraft and engines, and will allow better co-ordination of the requirements of civil and service aviation in this direction. The objectives of encouragement of local manufacture and coordination of Royal Australian Air Force and civil aviation needs should be attainable without sacrifice of efficiency in the commission’s operations, and the commission, being .charged with the responsibility of operating its services efficiently and economically, can be relied on to represent the matter strongly if the attainment of the previously mentioned objectives is likely to conflict with the commission’s responsibilities for efficient and economic operation. Should any such conflict arise, it will become the duty of the Government to determine the matter in order to best serve the interests of the nation as a whole. Government ownership of airlines can bc much more than justified by this issue alone.

The history of civil aviation in Australia is the history of aviation in all other countries. The first to start were the intrepid pioneers of flying. The earliest flights were largely experimental and not a few of them were accompanied by tragedy. Those pioneers were handicapped by lack of capital, frequently by lack of encouragement, and invariably by lack of suitable equipment. Indeed, they were handicapped by the lack of practically everything but courage a-nd a determination to keep on flying in the hope that their efforts would be recognized, and that civil flying would become an accepted mode of transport and communication. Few off them ever made the grade from a commercial point of view, yet their contribution in the development of civil aviation was very real. Then appeared what might be regarded as the development of regular local services designed to serve local communities and supported by local interests. Such services were chiefly confined to what might be termed owner-operator undertakings. The resources of the operators were comparatively small, and their services were accordingly restrictedboth in area and extent. Some owner-operator services are still being conducted in certain areas of Australia with the aid of government subsidies. Many of the local air transport services became, in the course of time, faced with failure as commercial enterprises. The lesson from this is that civil air services require considerable resources for successful operation. The inevitable trend in the circumstances has been that the successful operator was able to buy out operators in financial difficulties, or to take over routes discontinued through the commercial failure of former operators. When it became apparent that public expenditure had made the field of civil aviation profitable for the investment of private capital, the shipping interests, one of the most powerful monopoly groups in the country, decided to kill two birds with one stone. They decided to extend their profit-making holdings, and at the same time prevent the new form of transport from endangering their vested interests by competition. What followed ? Let us first take a look at the share register. We find listed a proprietary company named Australian National Airways Limited with the following shareholders: -

That list, honorable members will agree, might well have come straight from Lloyds Register. But where are the great pioneers of aviation, in whose names there has been so much sentimental appeal in the propaganda opposing the bill? We look for them in vain. There is a touch of irony in the fact that the very name of this monopoly company is the name under which the late Sir Charles Kingsford Smith and his gallant partner Charles Ulm began their brilliant, but ill-fated, pioneering air service. The only change in this name is the significant word “ proprietary “. So we discover that one by one the small pioneer enterprises are disappearing from the register. It is the inevitable process of absorption by monopoly. This strongly entrenched combine has behind it such resources that the struggling companies have little option but to accept merger or outright sale. Doubtless, some, at least, of them were glad to do so, but the fact remains that they are swallowed by a monopoly.

The official story of Australian National Airways, Wings of To-morrow - quite a prophetic title, honorable members will admit - reveals the names of eight such enterprises which became merged - perhaps I should say submerged - in this monopoly. Here are the names -

Tasmanian Aerial Services Proprietary Limited.

Holyman Airways Proprietary Limited.

Adelaide Airways Limited.

West Australian Airways Limited.

Airlines of Australia Limited.

New England Airways Limited.

Rockhampton Aerial Services Limited.

North Queensland Airways Proprietary Limited.

How that combine has grown ! Whereas in 1938 sixteen companies were operating in 1944 only nine remained, though the passenger miles flown were more than doubled in this period. Here we reach perhaps the most important evidence of all. Between 1940 and 1944 a total of £1,900,000 was paid to all airline companies in subsidies and mail poundage fees. But that is not all. Out of that total of £1,900,000 Australian National Airways Limited received £1,350,000, or, 70 per cent. But that is not all. The latest figures, those for the twelve months ended the 31st March, 1945, show that Australian National Airways Limited received 85 per cent, of the total payments in subsidies and mail poundage fees.

It was argued in the House of Representatives that the Government could and should have prevented the development of this monopoly, but the fact is that the Government recognizes that a monopoly in civil aviation is inevitable, and that from certain points of view it has many advantages. Experience has proved that an organization operating a multiplicity of airlines will almost certainly carry on more economically than will a number of companies each operating separate routes. Administrative costs decrease proportionately with the size of the organization. This is clearly borne out when the multiplicity of operations is appreciated, such as meeting requirements in respect of spare aircraft, engines, equipment, traffic staffs and supervision, buildings, workshops, and advertising. Savings can also be effected in the training of crews and ground staff and many other expenses, some of which are due only to rivalry between companies.

This bill means, quite simply, that the Commonwealth, acting logically, will take over the control of interstate airlines commensurate with its obligations and commitments in the development of this essential industry. Since a monopoly is inevitable, it must be a government monopoly operated for the nation. Since that is our intention, let us look again at the Commonwealth’s stake in civil aviation, which has always been greater than the combined stake of the private airlines companies. According to the latest, figures, the Department of Civil Aviation’s investment in capital expenditure is £4,157,000. In addition, the Department of Air and the Department of Aircraft Production, during the war, have incurred very substantial expenditure on aerodromes and hangars, some of which will be of value for civil purposes. The cost of those improvements which are of immediate or potential value for civil use is £7,337,000. Thus the total Commonwealth investment on ground facilities which will be used for. civil aviation has already reached £11,500,000, or more than eight times as much as the investment of all the private operators, which is Jess than £1,500,000. We must remember too, that the greater part of this capital expenditure is being used by the private companies without cost to them.

In debate in the House of Representatives, there was bitter complaint that Australia lacks emergency landing grounds and navigation aids. One opponent of the hill 3poke of the revolving beacons which he passed every quarter of an hour while flying across the United States of America. Australia, he declared, was as backward as a tenth-rate power in this respect. He said that there were few emergency landing grounds even between Sydney and Melbourne, as compared with any main air route in the United States of America. His fears might have been subdued, had he known that every time he flies from Sydney to Melbourne he is served by three main aerodromes and four intermediate emergency landing grounds. If he does not sleep throughout his journey, and is not so filled with scorn of things Australian that he is blind to evidence of what is provided for his safety, he can observe at intervals of fifteen minutes, as in America, the beams from rotating beacons flashing out from ten successive stations on this route. In case he should still think that Australia is a tenth-rate power in this respect, he may as well know that on the same route there are five aeradio stations.

Having dealt at some length with the considerations which have influenced the Government to decide to establish national control of the airlines, and having traversed the main objections advanced by opponents of government ownership, I shall now give an explanation of the bill itself. The Government has made it clear that the airline companies and those employed by them will he. given fair and just treatment. Tn the matter of compensation to the companies, the final arbiter will, if necessary, be the High Court, whose discretion on any such matter would, of course, be fully acceptable to the Government. The bill provides for the establishment of a statutory corporation which will be called the Australian National Airlines Commission, which will be charged with the responsibility of providing safe, efficient and economically operated airline services between the respective States and Commonwealth Territories, and within Commonwealth Territories. The Commission’s powers to establish and maintain air services may be extended with the approval of the Minister to cover international services. The Commission will consist of five commissioners, one of whom will be the chairman and one the vice-chairman. The commissioners will be appointed by the Governor-General. The chairman will be appointed for five years, the vice-chairman for four years, and the remaining three commissioners for four years, three years and two years respectively. Commissioners will be eligible for reappointment for further terms of three years. Normally, meetings of the commission are not expected to be held more frequently than once a month, although more frequent meetings will probably be necessary in the early stages. The remuneration of the chairman is left for determination by the Governor-General, but that of other members is fixed by the bill at £500 per annum for the vice-chairman and £400 per annum for the remaining three commissioners. Travelling and other allowances are to be at rates determined by the Governor-General.

The commission is required to appoint a general manager, who will be the chief executive officer of the commission. The staff of the commission is to be appointed by the commission, and recruitment of clerical staff is to be on the basis of open competitive examination. However, authority is reserved to the commission to appoint to certain prescribed positions persons who do not possess all of +he qualifications laid down in the hi1!. The salary of the general manager is to be determined by the Governor-General, and the salaries of other officers in excess of the rate of £1,500 per annum are subject to approval by the Minister for Civil Aviation. With these exceptions, the commission is empowered to fix terms and conditions of employment of all other persons in the service of the commission. The rights of any officer of the Commonwealth Public Service appointed to the service of the commission are preserved.

The airline services which the commission is authorized to conduct as a common carrier are those which cross State boundaries or boundaries between a State and Commonwealth Territory or which are wholly within Commonwealth Territories. The airline licences will be issued to the commission as provided in the Air Navigation Regulations. Provision is made for the commission to contract for the execution of any work or service authorized under the bill, subject to the approval of the Minister in the case of contracts for supplies from overseas in excess of a value of £10,000. Power is given to the commission to purchase and dispose of assets, but where the value exceeds £5,000, or, in the case of leases of land, where the term of the lease exceeds a period of five years, the approval of the Minister must be sought. The Minister may direct the commission to establish or alter or continue to maintain any particular air service, and if, in compliance with the Minister’s direction, the commission shows a loss in any financial year after making due provision for sinking and reserve funds, the commission will be entitled to be reimbursed by the Treasury.

Provision is made for an initial appropriation of £3,000,000, from which advances will be made to the commission as necessary to enable it to establish and operate its scheduled air transport services. The terms and conditions of these advances, including the security and basis of repayment, are to be determined by the Treasurer. The commission is required to prepare annual estimates of receipts and expenditure. Its accounts are to be kept in a form approved by the Treasurer, and are to be subject to audit by the Auditor-General. Rates, taxes and charges, except income tax imposed under any Commonwealth law, are to be paid by the commission. The Treasurer may authorize also the payment of other rates, taxes or charges. The commission is authorized, subject to the approval of the Treasurer, to set aside out of its revenue such sums as it thinks proper as reserves for depreciation or other purposes. The profits of the commission! are to be devoted to the payment of interest on advances m’ade by the Treasurer, repayment of such advances, the establishment and development of such airline services as are approved by the Minister with the concurrence of the Treasurer and in such other directions as are similarly approved by the Minister. The commission is required to furnish to the Minister an annual report and financial accounts which are to be laid before both Houses of the Parliament, and is to supply such other reports and information as the Minister may from time to time require.

Power is given to the commission to acquire compulsorily aircraft and other property, not including land, required for the purposes of the bill, and provision is made for the payment of compensation for assets so acquired. Though there is no legal obligation on the Commonwealth to pay compensation in .respect of loss suffered by an operator by reason of an existing airline licence becoming inoperative in consequence of the establishment of the commission’s service, the bill authorizes such compensation for the period up to the date of expiry of such airline licence. The method of dealing with claims for compensation is set out in the bill, including the establishment of a compensation board, presided over by a magistrate, to hear and determine claims and appeals. Where either party is dissatisfied with the decision of the Compensation Board, an appeal may be made to the High Court of Australia. The bill provides that where an airline licence is issued to the commission for any airline service authorized by this bill, and the commission has established that service, any airline licence held by any other person whose aircraft call at stopping places served By the commission is automatically rendered inoperative as regards the carriage of traffic, other than intra-state traffic, between those stopping plane*. ro long as the commission is maintaining an adequate service between those stopping places. It will be seen, therefore, that existing airline licences are unaffected by the bill, except insofar as the services operated under those licences cater for traffic which is adequately provided for by the commission’s services.

After the commencement of the act, no new airline licences will be issued to persons other than the commission or a contractor of the commission authorizing the carriage, between any stopping places on the commission’s services, of certain classes of traffic which those services are capable of handling adequately. The limitations in respect of existing and proposed airline services to which I have just referred do not apply to international airline services authorized by the Commonwealth Government. The bill contains a prohibition against persons contracting for the carriage of persons or goods for reward on any interstate service or service serving a territory unless such service is covered by an operative airline licence. Penalties are provided in the bill against any person who establishes or operates a public transport service in competition with the commission, and also for other offences, against the provisions of the bill. Claims for damages or compensation in respect of personal injury are limited to certain specified amounts.

The commission is authorized to make by-laws in respect of certain matters, and the usual provision is also made for the making of regulations. The powers and functions of the commission, as set out in the bill, do not conflict in any way with the powers and duties of the Minister or of the Department of ‘Civil Aviation under the Air Navigation Regulations, and those regulations, including all the safety provisions contained in them, will be applicable to the commission’s services equally with other operators’ services. In conclusion, I make the plea that this bill must be viewed in the light of the greatest good for the greatest number. The measure marks one of the first great steps to harness a new and growing force for the full service of the people. Its real purpose is to translate the mastery of the air into something which is the common right, of the people.

Debate (on motion by Senator Foll) adjourned.

page 4824

HOUR OF MEETING

Motion (by Senator Keane) agreed to-

That the Senate, at its rising, adjourn to to-morrow, at 10 a.m.

page 4824

ADJOURNMENT

Western Australian War Industries: Engineering Facilities - Australian Forces : Releases - Western Australian State Savings Bank - Repatriation - War Pensions - Potsdam Conference: Ultimatum to Japan; Statement by Minister for External Affairs - Stocking of Crown Leases - Answers to Questions - United Nations Charter.

Motion (by Senator Keane) proposed -

That the Senate do now adjourn.

Senator COLLETT:
Western Australia

. - Prior to the coming into power of the present Government, the best known leader of the Senate was Sir George Pearce, and it was his custom to allow full scope for honorable senators to discuss, on the motion for the adjournment of the Senate, matters of moment or of pressing urgency. Ministers then gave a considered reply to the matters which had been discussed. That practice has fallen into disuse of late. Last Tuesday week, I mentioned the preservation of the aircraft production workshop at Bayswater. I do not think that the Leader of the Senate (Senator Keane) made any reply at all, nor has the subject since been commented upon.

In these days, we hear a great deal about the reduction of the armed forces, with a view to releasing as many men as possible. I have here particulars of a case from Western Australia, in which a man of 43 years of age, with a sick wife and six children, five of whom are infants, applied for release from the Air Force. His release was recommended by the Department of Man Power, hut in reply to my representations on his behalf, I received a communication which contains this paragraph -

Ifind on inquiry that- ‘s discharge has been recommended by the Deputy Director of Man Power in Western Australia. However, on accountof the man-power position of the mustering of service policemen approval cannot be given for his discharge at the present juncture.

If a policeman is to be retained on the grounds that his services are essential, then the positionbecomes absurd.

On the afternoon of Thursday, the 26th July, Senator Eraser, by way of interjection, when Senator Gibson was speaking, suggested that the Government Savings Bank of Western Australia had, under - or because of - a Nationalist government, failed and the people had lost their money. Here is the actual story. In the year 1931 Mr. Lang, who was then Premier of New South Wales, announced his intention to default in the payment of interest on moneys borrowed by the State of New South Wales in Great Britain and elsewhere. He alleged that he was compelled to take this step by the then existing depression. However, the announcement, among other results, caused a. rush of depositors in the New South Wales State Savings Bank to withdraw their deposits. As a consequence, the hank shut its doors, and immediately afterwards the Scullin Government and the Commonwealth Bank Board intervened. This incident caused a feeling of insecurity generally in Australia regarding State-owned banks. In Western Australia, the State Savings Bank enjoyed the support of depositors to a much greater degree than did the Commonwealth Savings Bank, and this was a greatadvantage to the State Government, as it gave the Government control of moneys which could be used to the advantage of the State. The Commonwealth Bank was, at the time, very anxious to become possessed of the whole business of savings banks, and had made offers to take over the Western Australian State Savings Bank. These offers were not accepted. At the time of the Lang incident the position was that, as far as any run on the Western Australian State Savings Bank was concerned, that bank held a very large sum in Commonwealth loans, and if the Commonwealth Bank had been willing to advance even 50 per cent, of the face value of such investment, this would have provided ample money to meet any run. In the spring of this year, 1931, the State Premier was attending a Premiers Conference in Melbourne. Shortly after he left Western Australia, there was a slight run on the State Savings Bank, but the Acting Premier and Acting Treasurer dealt with this successfully. It was during the conference in Melbourne that negotiations with the Commonwealth Bank for the taking over of the State Savings Bank were resumed, and it is ‘believed that the ultimate decision was influenced by the continued refusal of the Commonwealth Bank to lend any money against its own bonds. The bank did not fail, nor did any depositor lose principal or interest.

Senator BRAND:
Victoria

.- On the 14th June the Minister for Repatriation (Mr. Frost) replied “ No “ to my question -

Is it a fact, that, despite the intention of Parliament that the onus of proof should rest with the Repatriation Commission, such a policy is not being adhered- to ?

I asked this question, amongst others, because there was every reason to believe the commission was adhering to the policy followed prior to the 1943 amendment to the Australian Soldiers Repatriation Act. This amendment was intended to place the onus of proof on the commission, and not on the appellant, in respect to the granting of a war pension on account of a disability caused or aggravated by war service. When this amendment, recommended by the all-party committee, was before this chamber, many honorable members expressed the opinion that too many difficulties had to be overcome by the applicant in producing evidence that his disability was due to war service. It was impossible, in many instances, to collect such evidence. Hence the amendment. The underlying principle, according to the wishes of Parliament, was to give the soldier the benefit of the doubt. Ever since the Repatriation Act was passed in 1920, I believe that principle as a whole has been followed in dealing with soldiers of the 1914-18 war. My information is that soldiers, sailors and airmen of the present war have to fight harder to obtain a war pension. The onus is still on the serviceman to prove his eligibility. Regulation 48, sub-clause 1, relating to this matter, states -

A medical practitioner shall, in reporting on any claim in relation to a member of the forces, set out in his report his opinion (a) in the case of a claim in respect of the death of the member as to the cause of the death, (6) in the case of a claim in respect to the incapacity of the member - as to the nature and extent of the incapacity, and shall also set out whether in his opinion, the incapacity from which the member is suffering, or from which he died, resulted (i) from an occurrence happening during the period he was a member, (ii) resulted from his employment in connexion with naval or military preparations or operations, (iii) is directly attributable to his employment as a member, (iv) arose out of or is attributable to his service as a member, or (v) has been contributed to in any material degree, or has been aggravated by the conditions of his war service. Sub-clause 2 says, where a medical practitioner entertains any doubt concerning any of the matters which by the last preceding sub-section he is required to report upon, he shall state in his report that he entertain* such a doubt, and shall indicate as far as practicable, the nature and extent of his doubt.

Seeing that a soldier, before final acceptance for service, undergoes a very searching medical test, and is later passed fit for active service, surely he has established u claim for a pension commensurate with his disability if he has become incapacitated. According to the Repatriation. Commission, this is not so. The soldier has to prove that his disability has not been due to some pre-enlistment cause - that, for example, his father or grandfather had no ailment which might be the reason for the aggravation caused by his war service. How can a soldier prove, or disprove, that he inherited such an ailment? He is called upon to give a history of hie health from babyhood. Surely, this is stretching things too far. Where does the benefit of the doubt come in ? Regulation 47 distinctly says the applicant should be given the benefit of the doubt.

I have been associated with soldiers all my life. I know some who will try to wangle anything. Some will say to a cobber, “I’ll give it a fly”, in the hope of “ getting away “ with it. But for one of that type, there are a dozen genuine men suffering a war disability who should be given the benefit of the doubt. The object of the amendment to which I have referred was to place the onus of proof on the commission, and not on the applicant, that is, to give him a reasonable chance to receive a war pension commensurate with his disability, which was not recorded on his medical history sheet when he proceeded on active service. I direct the attention of honorable senators to a minority report by Mr. O’sullivan, a member of the War Pensions Entitlement Appeal Tribunal tabled on the 28th February last. His observations on the Repatriation Department’s administration reveal the necessity for another all-party committee to straighten out certain anomalies in the act, besides giving the commission latitude in dealing with border line pension cases. The record of all-party committees so far appointed has been very successful. I know of no instance in the Parliament in which matters affecting ex-service personnel has been treated on party lines. Therefore, I urge the Minister representing the Minister for Repatriation to look into the matters T have raised and to consider the advisability of appointing an all-party committee to investigate the anomalies referred to by Mr. O’Sullivan.

Senator SHEEHAN:
Victoria

– I believe that reference should be made in this chamber to a matter of great importance to this country which was the subject of a statement issued recently by the Minister for External Affairs (Dr. Evatt). The Senate should note particularly the attitude adopted by a section of the press, particularly the Melbourne press, with regard to the Minister’s statement dealing with the ultimatum issued by the Potsdam Conference to Japan, in which the Minister dealt with the fact that Australia had not been consulted in that matter. A section of the Melbourne press has attempted to ridicule that protest of the Minister. I am aware that the Minister is quite capable of looking after himself, but I believe that some notice of the attitude of the press in this respect should be taken by members of the Parliament generally. I am pleased to note that the press in Great Britain has not accepted the Minister’s protest in the manner in which the Melbourne press suggested that the protest would be received in that country. The Melbourne press said, in effect, that the Minister responsible for speaking in regard to external affairs on behalf of Australia had no right to make that protest, and almost suggested that he should apologize for drawing attention to the fact that Australia had not been consulted on this very important matter. Honorable senators will appreciate the importance to Australia of the peace terms which will be imposed upon Japan. We realize that Australia stood in very grave danger of invasion by Japan. No part of the British Empire, with the possible exception of India, stood in graver peril of such invasion. No protests were made in the past, or. if they were made they were not backed up effectively, in order to prevent Japan from developing military bases in various parts of Asia, as the result of which it was obvious that the Japanese would menace this country. Much ha? been said about the part that Australia has played in this war. Tributes have been paid to the gallantry of our soldiers in various theatres of war, including the Middle East, ‘Crete, Libya and Greece; and I suggest that no more glorious story can be told than that which has been told of the wonderful tenacity and heroism of those young Australians who, practically untrained, went to New Guinea and stopped the advance of the Japanese towards this country. It is wrong for the press of Australia to suggest that we are not a selfgoverning country, and. in effect, to say that Australia and the other member? of the British Commonwealth of Nations should forget that there is such a thing as the British ‘Commonwealth of Nations. When matters of such importance to this country are under discussion, Australia is rightfully entitled to some consideration, and should be advised as to the probable peace terms that will be imposed upon an enemy which has menaced us for so long. Surely, no one suggests that the same .position exists to-day as existed at the outbreak of the war when the then Prime Minister of Great Britain, Mr. Chamberlain, said that it would be possible that certain parts of the Empire would be lost, but that these would be recovered later, indicating the possibility of the invasion and subjugation of Australia by the Japanese until such time as Great Britain and its allies could retake Australia from the enemy.Surely, we do not live in that age to-day. Surely, we realize that the future of this country is wrapped up with the position in the Pacific, and that Australia has livery right to he consulted as to what is likely to happen.

Senator Herbert Hays:

– And the rest of the Empire.

Senator SHEEHAN:

– That is so. The question I raise is why this very important part of the Empire, which is so vitally concerned with the peace terms that will he imposed upon Japan, should be told by a section of our own press that it is not the business of the Government elected by the people during the war - a Government elected because of its ability and power to organize this country during the war - to look after our own interests in the final stages of the war in the Pacific. I am pleased to note that as the result of the recent change of Government in Great Britain, responsible spokesmen of the new administration have suggested that such a thing is not likely to recur and that Australia will be informed of decisions on international affairs in future. I fully recognize the position of the “ Big Three “, who assembled at Potsdam, and the importance of the decisions that they were called upon to make. I am notquarrelling with that aspect; but I consider that Australia was entitled to be advised on this matter, and when a responsible Minister of this Government directed attention to it, the press acted unfairly to this country in suggesting that it was none of our business.

Senator Collett:

– Has the Minister foi1 External Affairs (Dr. Evatt) consulted this Parliament on the decisions of the San Francisco Conference?

Senator SHEEHAN:

– I should not like to think that any honorable senator supports the action of the press in this matter. I am directing attention to the attitude of a section of newspapers, and as a representative of the people in this chamber, I have a perfect right to do so. T deplore the attitude of those journals, which gave expression to “ Little Australianism”. Evidently they have not recovered from their chagrin because a Labour government is in office in Australia., because a Labour Minister complained that Australia had not been consulted, because Labour Ministers played a very important part in the councils of the Empire, and because. Labour Ministers will, in future, speak from the Mother of Parliaments on behalf of the British Empire. Those newspapers appear to be suffering from a fit of pique, and have seized upon this matter in an attempt to expose the Commonwealth Labour Government to ridicule and contempt.

Senator HERBERT HAYS:
Tasmania

– When speaking on the Drought Belief Bill- last week, I mentioned, among other things, that the shortage of feed on Government pastoral leases might be caused partly through over-stocking, and said that it might be desirable that a board, or some other authority, should inspect these properties, which are a national asset, for the purpose of seeing that they are not deteriorating. Senator Courtice, who followed me, subjected my suggestion to a good deal of banter, but the Minister for Health (Senator Fraser), when replying to the debate, ridiculed the idea, and stated that I had implied that an inspector should be appointed to count the stock depastured on Crown leases. Since that debate, 1 have obtained a specimen copy of a lease granted pursuant to the Leases Ordinance 1918-1937, as applicable to the Australian Capital Territory. This document sets out clearly the obligations of the tenant to the Commonwealth, as the landlord. Among the conditions of the lease are the following: -

Not to permit or suffer any stock not the property of the lessee to depasture on the said land without the consent in writing of the Commonwealth first had and obtained. The onus of proof of the ownership of any stock depasturing on the said land shall lie upon the lessee.

Not to over-stock the said land or any portion thereof. The Minister shall in all cases be the sole judge as to whether or not the said land is over-stocked, and may at any time by his officers or servants enter upon the said land and make a count of the stock depasturing thereon.

Although the Minister ridiculed my suggestion, the conditions of a lease granted in the Australian Capital Territory provide for the inspection of properties, and for the Minister or his agent to enter upon them and count the stock for the purpose of ensuring that the country is not over-stocked. I mention this matter because I made my suggestion offhand last week as a precaution against overstocking.

Senator KEANE:
Minister for Trade and Customs. · Victoria · ALP

– in, reply - I have noted Senator Collett’s complaint regarding the munitions establishment at Bayswater. Mr. Jensen, of the Department of Munitions, will see Mr. Harris to-morrow morning and obtain an answer to the question. Mr. Harris has been dealing with this matter, but, unfortunately, some delay has occurred in supplying an answer. For the information of honorable senators generally, I mention that some delay has arisen in furnishing replies to certain questions asked in this chamber, and I have directed a minute to each Minister asking him to request the responsible departmental officials to expedite the replies. Honorable senators will realize that during the last month, many departments have been engaged on preparing legislation. I do endeavour to see that answers shall be provided to every question asked in this chamber, and I am at a loss to understand Senator Collett’s comment that he was afraid that the excellent practice observed by a former Leader of the Senate was; evidently being departed from. I have gone out of my way to have the unrevised issues of Hansard examined every day for the purpose of expediting answers to questions, and I shall continue to do so. If the honorable senator will give to me the name of the member of the Royal Australian Air Force who desires his discharge I shall have the matter examined by the Minister for Air (Mr. Drakeford). The Minister for Health (“Senator Eraser) replied recently to the point raised regarding the Savings Bank, so I need not refer to it now.

Senator Brand suggested that anomaliesin the Australian Soldiers’ Repatriation Act should be examined by a parliamentary committee, and I shall discuss the proposal with the Minister for Repatriation (Mr. Frost). I agree with Senator Sheehan’s remarks about the attitude of the press. After all, the announcement was a momentous one; but I suggest to him that he did not emphasize sufficiently that Australia is more vitally concerned than the United States of America, Great Britain or any other nation in any decisions affecting future peace in the Pacific. Australia is isolated, and is the outpost of civilization in these waters. Other nations bordering on the Pacific are more favorably situated than we are.

Senator Collett:

– When may we expect a statement from the Minister for External Affairs (Dr. Evatt) on the decisional of the San Francisco Conference ?

Senator KEANE:

– The Senate will go into recess until the 29th August. I had hoped that the statement would be made in the House of Representatives to-day, but that was not done. However, this will be one of the first matters for consideration on our return. I understand that a statement is being prepared dealing with the results of Uncio. I agree that the results of the San Francisco Conference, as they affect this country, will overshadow any domestic legislation which may be introduced into this Parliament. If we can arrive at some formulae which will rid the world of war we shall have done an epic job. We can hold conferences, and organize the workers or the intelligentsia of the world, but our efforts will be of no avail unless we train the people of the world to see the futility of waging war. In other words, there must be a guarantee that peace will be adequately policed. I understand that the Attorney-General has prepared a voluminous document, and I shall see whether it is possible to have it released during the forthcoming recess so that honorable senators may have opportunity to study it before Parliament resumes.

Question resolved in the affirmative.

page 4828

PAPERS

The following papers were presented : -

Arbitration (Public Service) Act - Deter minations by the Arbitrator, &c. -

No. 41 of 1945- Hotel, Club, Restaurant and Caterers Employees’ Union of New South Wales.

No. 42 of 1945 - Australian Journalists’ Association.

No. 43 of 1.945 - Australian Journalists’ Association.

Black Marketing Act - Regulations - Statutory Rules 1945, No. 114.

Commonwealth Public Service Act - Ap- pointment - Department of Works and Housing - L. J. Price.

Customs Act- Customs Proclamation - No. 634.

National Security Act -

National Security (Economic Organization) Regulations - Order - Exemption.

National Security (General) Regulations -Order - Evacuation of area. .

National Security (Man Power) Regulations - Orders - Protected undertakings (88).

Northern Territory Acceptance Act and Northern Territory (Administration) Act - Ordinance - No.5 of 1945 - Medical Practitioners Registration.

Senate adjourned at 10.30 p.m.

Cite as: Australia, Senate, Debates, 1 August 1945, viewed 22 October 2017, <http://historichansard.net/senate/1945/19450801_senate_17_184/>.