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Wednesday, 27 May 1914


Senator DE LARGIE (Western Australia) . - Senator Ready, who has the right to resume the debate, has missed his boat from Tasmania. I do not know exactly what his position will be on his return, but I hope he will be allowed to resume his speech before the debate closes. I shall not deal with the constitutional aspect of this debate, which has been most ably covered by Senator Pearce, who showed in a very fine speech that the present constitutional position does not warrant the double dissolution which the Government are seeking. We have to remember that we are living under what is called representative government. There is no complication in the present situation in the shape of balance-of-power parties or third parties. There is a clear-cut, well-defined party position. We have two parties, with no go-betweens, and consequently, by counting noses, we know exactly where we stand. At the last election, where the Government claimed a victory, inasmuch as they are now in possession of the Ministerial benches, they actually failed to secure a majority of the seats contested. That fact alone shows that no good case can possibly be made out for their claim for a double dissolution. We know that in this Parliament there are sixty-five members in opposition to the Government, who have only forty-five members. Even at the last election only forty-five men came back from the country on the Ministerial side, as against forty-eight of their opponents. These facts prove that they are a minority Government, and therefore in seeking a double dissolution they are asking for something to which they are not constitutionally entitled. Their claim cannot possibly hold good in these days of representative government, seeing that the two simple measures that were introduced in another place and sent up here to form test questions were passed there only by the casting vote of the Speaker. I propose to devote the rest of my remarks to the state of affairs that has existed on the transcontinental railway since the present Administration took office. Questions have been asked in this chamber in regard to a contract at the Western Australian end of the line, and I am sorry to say that Ministers have not been candid in their replies. They have not stated the case as it actually exists, or as it existed recently. They have tried to mislead the Senate in order to get out of a difficulty similar to that into which they fell over £h\e Teesdale Smith contract. They recognise that they have what I might call a "rotten, bad case ' ' in connexion with the latter contract, and in order to avoid having a similar exposure hanging over their heads for letting a contract without calling for tenders, they have tried in a rather slippery manner to side-step the question by making out that the other contract to which I refer is merely a small piece-work matter, and not a contract at all. I will read the replies given here - and these are merely a repetition of those given elsewhere - to show the miserable way in which Ministers, recognising the difficulty that they are in, have tried to get out of their responsibilities. With regard to what is known as Mr. Morris' contract, Senator Pearce asked -

1.   Has a contract been let for portion of the clearing and earthworks of the Kalgoorlie end of the trans- Australian railway line?

2.   To whom was the contract let, and what are its terms?

3.   Were tenders called for such contract, and in what newspapers, and for what length of time?

4.   Will the Minister lay a copy of the contract on the table of the Senate? and the answer was -

Not as usually known as a contract. In July, 1913, I approved a recommendation of the Engineer-in-Chief that lie should have authority to let piece-work where it was considered that the work could be carried out to better advantage and more economically by doing so; also of the rates being authorized by the Engineer-in-Chief. The Engineer-in- Chief fixed a scale of rates, and several small portions of piece-work were let by the acting Supervising Engineer, Kalgoorlie.

As a matter of fact, the contract was let to Mr. Morris, who has been for many years a well-known contractor on the gold-fields of Western Australia, in partnership with Mr. Mayman. It is all nonsense to make out that such a wellknown firm as Mayman and Morris would go in for a piece-work system. No one who knows them would believe it for a moment, although the statement might go down with those who are not acquainted with them. So far from this being a small piece-work job, there are at least 130 men employed by the contractor and paid daily wages in the usual way. A task is not set out for them any more than it was for the men employed under the Government in constructing other portions of the line. The men are engaged as they were under the Government in clearing and carrying out the earthworks from the 72-mile to the 200-mile peg. The contractors have entered into an agreement with the union controlling this class of work in that portion of Australia. This is the agreement that was entered into in Kalgoorlie on February 26th -

Negotiations were concluded to-day between the Trans-Australian branch of the General Workers Union and Messrs. Mayman and Morris, contractors for the Government, on the subject of increased rates of pay and improved conditions of labour for men employed on formation and clearing work on the Western Australian section of the Trans-Australian railway. The result was that an agreement, was arrived at which dates from 1st March next, and will last until the men reach the 200- mile peg. They are now- 75 miles out. The rates of pay and conditions are set out as follow : - Gangers, 20s. per day, wet or dry-

The men employed by the contractors when previously employed by the Government were promised that their rates of pay would be increased from the time they reached the 60-mile peg for all work beyond that point. I do not hold the present Government responsible for themaking of that promise, because they did not make it. It has been their practice to repudiate almost everything the previous Government did in connexion with the employment of labour, and the previous Government were pledged to increase rates when the 60-mile peg was reached. The contractors *m this case have recognised the. universal rule in the West that rates of pay shall be increased in accordance with the distance of the work from Kalgoorlie, where it is acknowledged that the minimum rates for work in that part of the country are .paid. The rates provided for in this agreement are much higher than the rates previously paid to the men engaged in the work, but that was only in accordance with what was expected by the men when they got beyond the 60-mile peg. To continue, the rates of pay provided for in the agreement -

Navvies, 13s. 4d.; tip-men, trimmers, hammer and drill men, and jumper men, 14s. 2d.; nippers, 10s. per day; scoopmen and ploughmen, 13s. 4d.; tool sharpeners, 15s. per day; clearers, 13s. 4d.; powder monkeys, 15s.; tradesmen's labourers, 14s. 2d.; camel-drivers, leading hands, 15s. per day, seven days a week, no overtime; camel-drivers, off-siders, 13s. 4d., seven days a week, no overtime. The following conditions have been arranged : - Free supply of shovels-

That is more than Mr. Teesdale Smith did for the men engaged under his contract.

Walking time shall be allowed the men for walking the full distance one way.

The agreement goes on to explain that -

The secretary of the union, Mr. Costello, has been appointed by that body to represent the men affected.

Honorable senators will see that this work is being carried out under an agreement which is as much a contract as that entered into with Mr. Teesdale Smith. Whether there is a written contract between Mr. Morris and the Government we do not know. We do know that Mayman and Morris have undertaken a contract, and are employing all the men who were previously employed by the Government on the construction of the line. The contractor has recently been obliged to stop work, not because he withdrew from the piece-work proposition, as stated by Ministers, but because the rail head is so far away from where his operations were stopped that he is unable to get water and provisions out to keep the men going. Since the strike on the line occurred, the engine running to the end of the rails has been stopped because the men engaged upon it are on strike with the rest. Honorable senators will see from this that there is something which the Government are concealing. Why were they not candid enough to admit that they had entered into a contract with Mr. Morris, and omitted to call for tenders ? They have offered various excuses to make good their contention that this is not a contract at all, but merely piecework, the .object being to free themselves of responsibility for not having called for tenders for the work. I hope .the Government will yet recognise their responsibility in the matter, and do what decent people would do in the circumstances. The whole administration in connexion with this railway is so smellful that men having any respect for their own reputation would insist upon an inquiry into everything connected with it. I sympathize with the Government to some extent, because I recognise that they were guided by a consulting engineer who was a most unreliable person. If they have been led into this through following his advice they should let the Senate know how far that advice went. While the Government would be justified in acting upon the advice of the Engineer-in-Chief upon purely engineering matters, that would not free them from the responsibility for the policy adopted in connexion with the construction of this railway. We know that, in regard to the construction of public works, there is a well-defined difference between the policy of the present Government and the policy of the Labour party. We know that they have proclaimed their intention to have everything on this railway done by contract, as far as possible, instead of by day labour. We can agree to differ as to the merits of the two systems, but where the condition of giving publicity to their intention has not been fulfilled, in order that public money should be spent to the best possible advantage, the Government ought to set at rest the suspicion which is in the public mind regarding these jobs. It is they alone who are responsible for the suspicion which surrounds the Teesdale Smith contract. I do not propose to say more about the Morris contract, except that it is on all-fours with the Teesdale Smith contract as regards noncompliance with the ordinary condition of calling for tenders. As regards the rates, I do not think that there is anything wrong. We know that the rates Mr. Morris and Mr. Mayman were paying were the cause of the stoppage of the whole of the works. You cannot persuade a man who lives in the backblocks that he is entitled to be called anything else but a blackleg or a scab if he is caught working for less than the current rate in his district. Now the current rate in the locality of this contract is 13s. 4d. per day. The Government will not give that rate to the men, and consequently the responsibility for the strike can be surely ascribed to them. How long do they intend to allow this state of affairs to continue? The whole of the construction work in Western Australia is suspended. I can assure the Government that they need not expect the men who do the hard work to cave in. They are not likely to work for less than they believe they are entitled to receive. The job will be at a standstill until the Government are prepared to pay the current rate in the district. It was stated here to-day, in reply to questions, that the Government are paying higher wages than are paid' to men working on mines.

That' is an absurd statement. A man on a mine is doing different work entirely. The Government might just as well have said, in reply to the questions to-day, that they are paying higher wages at Kalgoorlie than are paid at Melbourne. If the Government wish to see this work proceeded with, there is only one thing they can do, and that is to agree to pay the current rate of wages. The pick and shovel work which is done on the surface for the road boards is much more comparable with the work done on the railway, but it is absurd to compare labouring work on the surfaceof a mine - and very simple kind of work it is - with the work of road-making. In the bush, right away from Kalgoorlie, there is no means for a man to live in the same way as he can do in an established town. Everything is so different that it is really foolish to make a comparison. In regard to the wages paid by road boards on the gold-fields, in every instance of which I have had experience, the rate of pay has been higher than that which is offered by the Government for doing somewhat similar work. I have mentioned these facts in the hope that the Government may reconsider their position, and try to bring about a settlement of the dispute at the Kalgoorlie end of the transcontinental railway.


Senator O'Keefe - They cannot be in much of a hurry to finish the line.


Senator DE LARGIE - They are in no hurry apparently; otherwise they would have tried to bring about a settlement earlier. I wish to touch briefly on the Teesdale Smith contract. I do not propose to go into details, because I think that the matter has been placed so fully before the Senate that there is now very little left to be said by me. I notice that no supporter of the Government has endeavoured to justify the attitude taken up by the Assistant Minister of Home Affairs. He said he was responsible, and was going to accept all responsibility, for the contract. That statement sounds all right, but where does his responsibility begin and end ? For a Minister to make that statement, and let the matter drop at that, is not going very far; he is not taking a great load on his shoulders. It has been shown as clearly as is possible that the contract has cost at least £20,000 more than it should have cost - that is, in comparison with the cost of similar work on the transcontinental railway.


Senator O'Keefe - That is to say, it has cost double as much as it ought to have done.


Senator DE LARGIE - Something like £41,000. The work, based on thecost of similar work in similar country' on the transcontinental line and on the gold-fields railways,' has cost at least. £20,000 more than it should have cost. I ask the Government what is the responsibility of Mr. Kelly in a case of" this kind?


Senator Senior - Are you aware -that In South Australia the line from Tailem Bend to Pinnaroo was built at a cost of £973 per mile?


Senator DE LARGIE - That is quite true, but the railways in South Australia, have not been built as cheaply as the lines in Western Australia, where much higher rates obtain. Mr. Kelly is reputed to be a rich man. Is he going to make good the £20,000 which, through his ignorance, or perhaps something worse, he lost to the taxpayers in handing over this contract to Mr. Teesdale Smith? If he says in a " hifalutin " way that he takes all responsibility, let him "carry the baby." Let him find the money that Mr. Smith is pocketing, and thenwe shall see that there was some meaningin his statement to the House. Either he must be prepared to pay the bill or he must admit that he has been robbed,, and retire from his position, so that the public may feel that something like business methods are being pursued in the Home Affairs Department. If he hangs on to the position and to his cash, he is taking no responsibility; he is merely taking a little kudos of a cheapkind, and that, I am confident, will not satisfy the public, nor do I think it will satisfy the members of the Senate or of another place.


Senator O'Keefe - He does not seem to be quite so " cock-sure " as he was.


Senator DE LARGIE - I think it is ridiculous for the Assistant Minister, in the face of what honorable senators know about railway construction, to take up the attitude he does. The Minister of Defence made a comparison betweenthe cost of the Canberra line and the cost of the 14 miles of line let to Mr. Teesdale Smith, and also between the two kinds of country. The comparison is absolutely ridiculous, . consideringthe undulating and rocky nature of the country at Canberra. Any political novice, even a kindergarten politician such as Mr. Kelly, should know that it will cost a great deal more to build a railway in country where there are rivers to be crossed, bridges to be constructed, hard rock to be excavated, and so on, than to run a line over flat country where there is practically little other than sand to shift. Any man who seriously institutes a comparison between the two kinds of country, or the construction of a railway through them, merely exhibits want of knowledge. Let me now point out the cost of railway construction in Western Australia. The first gold-fields railway constructed in Western Australia was the line from Southern Cross to Coolgardie, a distance of 114 miles. It was constructed through country somewhat similar to that which the transcontinental railway is to traverse, and it was built at a cost of £527 per mile on a 3-ft. 6-in. gauge. The work was carried out by contract, and perhaps it is the most cheaply constructed line in Australia. The goldfields railway from Mulliwa to Cue, a distance of 196 miles, was constructed at the rate of £640 per mile. The line from Coolgardie to Kalgoorlie, a distance of only 23 miles, cost £726 per mile. These figures indicate the kind of country which the transcontinental railway is being taken through, and suggest, too, that behind the Teesdale Smith contract, costing, as it does, over £3,000 for earthworks alone, there is something which has not been revealed. I feel satisfied that Parliament will unearth the something. There is no need for me to further thresh this subject. We have heard a good deal about the contract. I now propose to tell the Senate something about the man who is behind this contract, in order that the public may be seized of the full facts of the case, and may know the kind of individual with whom the Government like to do business.


Senator Blakey - He told me that he preferred cheap coolie labour to Australian labour.


Senator DE LARGIE - I can quite understand that. Mr. Teesdale Smith is very well known in Western Australia, where for some time he stood at the head of the biggest Timber Combine in the Commonwealth. He filled the position of general manager of that combine, and drew a salary of £5,000 a year - an enormous salary even for a trust to pay. Whilst he was drawing this magnificent emolument he paid the most wretched, sweated wages ever paid by any man who has employed labour there.


Senator McGregor - Was not that what he got the £5,000 a year for ?


Senator DE LARGIE - There is no doubt that, in order to make up the £5,000, he had to take a good deal from the labouring man. He paid the notoriously low wage, for Western Australia, of 7s. per day, and not until a strike took place was any improvement in the condition of his employes effected.


Senator Mullan - It is a pity that he could not be made to live on 7s. a day.


Senator DE LARGIE - To compel him to do that after having received a salary of £5,000 a year would mean starvation to him. On one occasion, whilst filling the position of manager of the Timber Combine, Mr. Smith was asked if he regarded 7s. per day as a sufficient wage to enable a man to maintain his wife and family. His reply was, "I do not concern myself at all about how far 7s. a day will go. I am here to get labour at the cheapest possible rate, and all that I will give is 7s. per day." I may mention that Mr. Frank Wilson, the Leader of the Opposition in Western Australia, who is the paid advocate in the Arbitration Court of the Timber Combine - he occupied a similar position to that which was filled by Senator Oakes before he entered this Chamber-


Senator Lynch - He was a paid agitator.


Senator DE LARGIE - Yes. I hope that Senator Oakes gave satisfaction for the wage which he received. Mr. Frank Wilson went even one better than Mr. Teesdale Smith. He wanted to get labour for 6s. 6d. per day. I mention these facts for the purpose of showing what would be the lot of the workers if such persons had their way. At the time of which I speak, the truck system was in full swing in that portion of Western Australia which was ruled over by the Timber Combine. Honorable senators will understand that these timber concessions are a considerable distance from established towns. The word "concession," I confess, is rather a confusing one, and I have never been able to understand why it is applied to these districts. However, it is the word which is always used in Western Australia. The Timber Combine rules these places with an iron hand. It has its own stores, and it will not allow business men to go there and enter into competition with them. I have seen commercial travellers ordered off the trains which run between the Government lines and those of the Timber Combine. They were not allowed to solicit orders in the timber mills. I repeat that the truck system was in full swing at the time, and it is well known that the men employed by Mr. Teesdale Smith frequently found themselves in debt when pay day came round. Not only was the truck system followed, but for the houses which, in some instances, the men had built for themselves out of scrap timber, rents were charged that were out of all proportion to the value of the buildings. In this way Mr. Smith's £,3000 or £5,000 a year was made up. It was made up by robbing the workers in that particular industry. After the strike a change came over the scene. Mr. Teesdale Smith's resignation was announced to the public. For some time it was not known what led up to his resignation. When I read some of the correspondence in which that gentleman engaged, in order to influence the public mind in regard to trusts and combines, it will be seen what an unscrupulous character he is. Evidently he did not like the idea of losing the very good billet which he had enjoyed. But one would expect that a man occupying such a position would have had some sense of decency and loyalty to the company which had employed him, and that he would not seek to " blow the gaff " on them after he had lost his berth - that he would not expose their tactics and endeavour to do them harm. But that is precisely what he did. He attempted to injure them through quite a number of persons. At that time there was a newspaper published in Perth called the Morning Herald, the editor of which was Mr. Drayton. Mr. Drayton received a very great quantity of matter from Mr. Smith which was calculated to expose the methods pursued by the Timber Combine. The correspondence which I propose to read by no means exhausts the material in my possession; and if an inquiry is instituted into the Tees dale Smith contract, I shall embrace the opportunity to place the whole of it on record. Mr. Teesdale Smith, writing; from the Australian Club, Melbourne, on the 16th March, 1908, said-

Dear Chinn. - Let Drayton know that business pressure prevents me sending my weekly budget by this mail. Besides, I think one does not want to get going too strong so far away from polling clay.


Senator Oakes - Was that letter published in the newspapers?


Senator DE LARGIE - Not in the form in which I am giving it. The letter proceeded -

Ease up a bit, and drop a bombshell about once a fortnight or so. - Yours, &c., Teesdale Smith.

That letter was written to a man whom Mr. Teesdale Smith has endeavoured to injure as much as possible - I refer to Mr. Henry Chinn, late Supervising Engineer of the Western Australian section of the transcontinental railway.


Senator Oakes - I thought there was something similar to the Chinn business about it.


Senator DE LARGIE - Mr. Smith is one of those individuals who were mentioned by Mr. Deane. I intend to connect Mr. Deane with Mr. Teesdale Smith, and to show that there is something behind that combination which has not yet been made public. This is a matter which should be probed to the bottom. When the Chinn inquiry was in progress, Mr.. Deane repeatedly stated that he had been warned by Mr. Teesdale Smith to have nothing to do with Mr. Chinn. We tried to find out from Mr. Deane what Mr. Teesdale Smith had said against Mr. Chinn, but could get no direct reply to our queries. All that we could get was an insinuation that Mr Deane, as Consulting Engineer-in-Chief, should not employ Mr. Chinn on the railway. He said he also had a letter that he had received; but we could not get that letter out of Mr. Deane, nor could we get Mr. Teesdale Smith to come forward and give evidence at that time. It would have been interesting if Mr. Smith had come forward. Perhaps we should have found out things which would have prevented the Government from having anything to do with him. The second letter is dated from the Hotel Australia, Sydney, 5th March, 1908, and runs as follows : -

Mr. McMurtee,general manager of Millar's Combine, with his eastern manager, is here fixing up timber contracts with the Merchants' Association, which will bind them to obtain all supplies of jarrah or Western Australian timber sold, absolutely from the combine. It is rumoured that the price has advanced about 20 per cent., which means that the consumer will be paying fully 40 per cent. more than he was five years ago, previous to the unholy union of association and combine - which has brought forth a miniature trust of the Standard Oil type. It is an open secret that jarrah shipped by Millar's Combine has always received from the shipping associations more favorable terms than the timber shipped by other producers, either in the shape of rebate or lower freight. The one deadly principle aimed at by the Standard Oil Combine was the rebate system, and it was through that means that they were enabled, step by step, to undersell and drive out all opposition.

Tours, &c.,

H.   Teesdale Smith.

There is no doubt as to the originals of these letters, and we shall challenge the Government on them. I hope the Government, for the sake of their own reputation, will take up the challenge. The third letter, which is dated 5th March, 1908, is addressed from the Weld Club, Perth, the leading club in that city, in the following terms: -

Get your friend to publish a real snorter,as a leader or sub-leader, on the question of the co-operative agreements - could make a really artistic bit of reading.


Senator Millen - We are getting an insight into Mr. Chinn now. You are letting the light in on him.







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