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Wednesday, 24 May 1939

Mr SPEAKER - Is the motion supported ?

Five honorable members having risen in support of the motion,

Mr THORBY - I direct the attention of honorable members especially to the action of the Minister for the Interior (Senator Foll) and the PostmasterGeneral (Mr. Harrison) in accepting or approving of a tender other than the tender which was accepted by me when I was Minister for Works. I should like to outline briefly the history of the position, because I feel that it is a dangerous precedent to allow to pass. Possibly the Minister for the Interior made a mistake. A considerable time ago the Government of the day decided that it was absolutely necessary to provide for additions to the Sydney General Post Office. Inquiries were made and conferences and discussions with the responsible officers were held, and it was ultimately definitely decided that additions were necessary. The Government accordingly took steps to secure the necessary land and resumed a site adjacent to the General Post Office. Subsequently, plans and specifications were prepared under instructions from the Government.


Mr THORBY - Thorough investigations were made and it was decided that additions were necessary to cope with the work of the General Post Office. Officers of the Works and the PostmasterGeneral's Departments conferred as to the plans and specifications, and ultimately these, together with the estimates, were considered by Cabinet. Tenders were then called. Alternative tenders were asked, first, for a building with granite facing on the lower and terra-cotta facing on the upper floors, and, secondly, for granite facing on the lower and sandstone facing on the upper floors. The two sets of specifications were submitted to the whole of the contractors, and a very satisfactory list of responsible contractors tendered. The tenderers numbered ten, twelve or fourteen - I speak from memory - and their tenders were considered by the department. The matter was further considered by Cabinet and a subcommittee of Cabinet consisting of the then Postmaster-General (Mr. Archie Cameron), the present PostmasterGeneral (Mr. Harrison), and myself as Minister for Works, was appointed to complete the consideration. The matter was carefully considered, and the tenders were dealt with in the ordinary way by the departmental officers. Prior to my hearing of the amounts of the tenders, it was reported to me that a certain contractor had made representations that he was dissatisfied with influences outside the jurisdiction of the department. I want fair to Ministers and to senior officers. I asked for further particulars and granted an interview to the person who lodged the complaint, and heard what he had to say. The complaints that he lodged were similar to the complaints that he had lodged with the department at Canberra on the previous day. I was satisfied that things were not as they should be so far as certain suppliers of articles required by the contractors were concerned. The complaint was that those outside suppliers had quoted different prices to different contractors. That was a serious position, because it meant that the outside suppliers could influence prices to such a degree as to decide who should get the tender by submitting the lowest price to the Government. That ' was not as it should be. I discussed the matter with the senior member of my department, the Director-General of Works, and I myself carefully investigated the whole of the tenders. Then I went through the whole of the list of the tender prices with the Director-General of Works, after which I discussed the matter with the then PostmasterGeneral and asked him to discuss it with his officers and let me know if he concurred in the proposals that I had put forward. After the lapse of one or two days, the then Postmaster-General and I had a further discussion, and he stated definitely that he concurred in my views, having discussed the matter, I understand, with officers of his department. After that I had a discussion with the Assistant Minister, now the PostmasterGeneral (Mr. Harrison), in his office in the Commonwealth Bank building. From the windows of his office I pointed out to him the existing post office building and the site of the proposed new building, and indicated the approximate height of the new building. We discussed the kind of material proposed for facing the building - the only matter in question - and reference was made to the prices submitted in the various tenders. I said what I proposed to do in connexion with the acceptance of the lowest tender, and the Assistant Minister concurred with me. There was no difference of opinion between me and either of my two colleagues on the Cabinet sub-committee which was dealing with the matter.

Mr Harrison - That is hardly a correct statement.

Mr THORBY - If the honorable member disagrees with anything I say, he will be able to reply later. I am trying to put the matter fairly and to describe what occurred, incident by incident. I have no desire to misrepresent ' any Minister or official, but I believe that this matter should be ventilated, because an amount of more than £400,000 is involved. This is the first time I have e vettaken up the time of any parliament,

State or Federal,by moving the adjournment of the House, but I feel justified in doing so on this occasion. I went into the matter of the tenders with officers of my department, who recommended that I should accept the lowest tender for a building faced with terra cotta above the lower storeys. The Government architect recommended terra-cotta facing. The Director-General of "Works was quite easy on the matter, hut when I went into it I became convinced for several reasons that the building should be faced with sandstone. In my opinion, and in the opinion of most competent persons with whom I have discussed the matter, the sandstone finish provides a much more substantial job, and, in addition, the tender for that kind of finish was £1,451 less than for the other. Another reason for favoring the sandstone finish was that it would provide a substantial amount of work for quarrymen and stonemasons in Sydney who badly need it. Their services are in demand only for stone used in the construction of big city buildings, whereas bricklaying and other work can be obtained by other tradesmen who are in demand all over the Commonwealth. If the building were finished in sandstone it would conform to the existing post office which is stone-faced, though of a different style I admit. Moreover, practically every other building in that vicinity is faced with stone. There is no terra-cotta faced building anywhere nearby in George-street, Martin-place or Pitt-street. All are of stone. If honorable members take the trouble to look for themselves, they will see that every substantial building in that area is faced with stone. I defy the Commonwealth architects, or any others, to justify a terra-cotta faced building as . against a stone-faced one in this area. My opinion in this regard was shared by the Prime Minister (Mr. Menzies) who insisted that the large Patents Office in Canberra should be stone faced in order to improve the appearance of buildings in this city. There was every justification, if the tender prices had been about equal, for giving a casting vote in favour of the stone-faced building.

When I examined the tenders I found that the lowest tender for a building faced with terra cotta was £410,776 while the lowest tender for a stone-faced buildingwas £409,325, a difference of £1,451 in favour of the sandstone finish. The Government may reply that that is a small amount on. a job costing over £400,000, but I do not care if it were only £5; when tenders are called, the lowest tender received from a suitable firm should be accepted. The. officers of the department will bear me out when I say that there was no difference in the specifications, except as regards the facing of the upper stories. Therefore, the question was whether we should pay £1,451 more for what was, in my opinion, an inferior job.

Mr Beasley - The. fact that there was a difference of only £1,400 on so big a job does not look well to me. The tenders were tooclose.

Mr THORBY - No, I took the opposite view. I do not believe that there was collusion among the tenderers. A strange thing is that, of the two contractors whose tenders are now under discussion, the one who put in a higher tender for the terra-cotta facing, put in the lowest tender for the stone facing, but I do not suggest that there is anything wrong in that. About a dozen tenders were received, and I believe that there was. genuine competition between them.

Mr Scullin - Was the honorable member satisfied regarding the stability of the lowest tenderer?

Mr THORBY - Yes. The officers of my department were convinced that there was no reason why the lowest tenderer should not be given the contract. On the 18th April of this year, while I was Minister for Works, I approved of the acceptance of the tender of John Grant and Sons Limited for the construction of a building faced with sandstone, the contract price being £409,325. That was the original, unaltered tender. I would not allow any tender to be altered, any more than any other Minister should. The Department of Works had recommended the other tender, because it was for a building faced with terra cotta. After I went out of office I found that the matter had been revived. As late as last week an announcement was made by the present Minister for the Interior (Senator Foll) to the effect that the Government had accepted the tender of the firm of H. G.Whittle and Sons Proprietary Limited, the price being £410,776. That prompted me to ask a question in this House of the Minister representing the Minister for the Interior. I was asked to put the question on the notice-paper, and here it is -

1.   Has the contract to erect additions to the general post office, Sydney, yet been signed?

2.   If so, who was the successful tenderer?

3.   What is the contract price?

4.   Was the lowest tender accepted?

5.   What materials arc specified for the front elevation facing Pitt-street?

The following reply was supplied to me last Tuesday -

1.   No.

2.   Although the contract is not yet signed, H.G. Whittle and Sons 'Proprietary Limited have been notified of the acceptance of their tender.

3.   £ 41 0,776.

4.   The specification called for alternative tenders for terra cotta facing and sandstone facing. The lowest tender for terra cotta facing was accepted.

5.   Facing with granite on the lower floors and terra cotta for the upper storeys.

Sir Charles Marr - Is H. G.Whittle and Sons Proprietary Limited a Sydney firm?

Mr THORBY - I believe so, but I am not concerned about that. My point is that the duly constituted authority of the Commonwealth to deal with the matter was the Minister for Works, no matter who he was. He approved of the acceptance of the lowest tender on the18th April. His successor in office first indorsed that decision, but later reversed it and accepted another tender for a building faced with terra cotta. I submit that the Government should amply justify that alteration of a previous decision. Particularly should it justify substituting terra cotta for stone on a large building in an area where practically all the buildings are stone faced. I had no wish to be unfair to the members of the Government on this matter. Immediately I ascertained what was being* done, I waited upon the Minister for the Interior (Senator Foll). He called into his office the new Postmaster-General (Mr. Harrison) and we discussed the subject. I told the Ministers in their office that I was not satisfied with what had been done, and that if they persisted in the course that they had set for themselves I should take the matter further.

They have persisted, and, therefore, I am inviting the attention of honorable members to all the circumstances of the case. Not only the Minister directly concerned, but also the Government itself, should be required to justify this alteration. It is true that I was told in reply to my question that the contract had not yet been signed, but it is also true that an announcement has been made that approval has been given to the acceptance of a certain tender. I wish to make it clear that I acted in a strictly orthodox manner. I obtained advice from the appropriate officers and subsequently signed an approval for the acceptance of a tender. It was not my place to go further. My signed authority will be found upon the departmental files. I make it clear that the lowest tender for a stone-faced building was accepted. That was the end of my responsibility. It was not my place publicly to announce the acceptance of the tender, for the reason that the Treasury, at that stage, had not. made available all the funds required for the contract. I instructed my officers to approach the Treasury for the purpose of securing the funds needed. In the meantime a change of government took place and the alteration that I have indicated has been made. I take definite exception to the Government acting in this way without fully explaining the reasons which prompted it to do so.

Mr McCall - What reasons were given to the honorable member when he interviewed theMinisters?

Mr THORBY - One reason was that the building could be obtained at a lower cost and another was that since I had signed approval for the acceptance of the tender a. new process in the manufacture of terra cotta has been evolved which would reduce the cost. I am not prepared to accept those reasons. If the process of manufacturing terra cotta has been varied to such a degree that the material is now obtainable at a less costly figure, the thing to do is to call for new tendersfor the work.

Honorable Members. - Hear, hear !

Mr THORBY - New tenders should have been called publicly, and it would have been proper had the appropriate Minister notified this House that that course was being followed.I think, also. that I should have been notified, for, in effect, what has been done repudiates my signature, and casts a slur upon a decision which I had made. I am quite prepare^ to face the most open inquiry that the Government can arrange on this subject, and I shall not protest against any variation of my decision provided it is made on just grounds and in a proper way. But I object to the hole-and-corner method that has been adopted. I do not think that I am disclosing any confidence when I say that the present Minister for the Interior actually endorsed my decision. Subsequently he reversed both his own and my decision. I do not wish to be unfair to the honorable gentleman, or to any one else, but I think that the Minister hardly realizes the seriousness of what he has done, or the full extent of his decision.

Mr SPEAKER - The honorable member's time has expired.

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