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Wednesday, 18 May 1904

Mr WATSON (Bland) (Treasurer) .- I desire to lay upon the table the following paper: -

Copy of a letter from the Right Honorable the Secretary of State for the Colonies to His Excellency the Governor-General, dated 33rd March, 1904, regarding the use of the title of " Honorable" by members of the first Parliament of the Commonwealth of Australia.

I move -

That the document be printed.

I make this motion as a cover for a general statement of the intentions of the Government in regard to matters of policy, and, with your permission, Mr. Speaker, to provide an opportunity for a full discussion by honorable members of the statement I am about to make. Honorable gentlemen will easily understand that as Ministers are all new to office, and have had at their disposal a time all too short in which to consider the important matters with which they have had to deal - though I admit we had no right to ask the House for a longer adjournment - it has been impossible to prepare for consideration this session any large general measures of policy. There is now a comparatively short time remaining of the session which began in March last; but before Parliament is prorogued it will be necessary to consider the Budget,' and, therefore, it seems impossible to deal with more than a short programme if the Ministry are at the end of the session to have the credit of having accomplished work, rather than of having submitted for discussion a long and impossible series of measures. The view we take is that we should submit a practical programme - a list of measures which we .have a reasonable expectation of passing during the time at our disposal. I will therefore briefly indicate a few of the matters in regard to which we hope to introduce legislation - providing, of course, that political exigencies allow us to do so. For immediate work we propose to resume the discussion upon the Conciliation and Arbitration Bill at the point at which it was dropped by the last Administration a few weeks back. We are in agreement with the members of the last Administration so far as the general principle involved in the measure is concerned ; that is, we believe in a measure providing for compulsory arbitration, as distinguished from any substitute put forward in either State or Federal politics for voluntary arbitration. As we are in agreement upon that point, and are anxious to get through business in the shortest time possible consistent with effective consideration, we intend to take up the Bill at the point at which it was dropped, and we propose to fill the blank created by the carrying of the amendment of the present Minister for Trade and Customs by inserting, first, a provision to apply the Bill to railway servants, and, secondly, a provision extending its operation to those employed in industries carried on by or under the control of the Commonwealth, or of a State, or of any public authority constituted under the Commonwealth or under a State. Guided by the opinion of our learned Attorney-General, we take the view that this Parliament is empowered by the Constitution to include within the scope of the Bill all industrial servants of the Commonwealth or of a State. Beyond that we feel, according to our reading of the Constitution, that we are not entitled to go.

Mr Crouch - Then the Government have abandoned the public servants ?

Mr WATSON - We have not abandoned the public servants. Personally, I have never asserted that we are bound to include the clerical employes of the Governments of the Commonwealth and the States "other than those who may be incidentally connected with industrial concerns carried on by those Governments. The honorable and learned member for Darling Downs brought the subject prominently before the House in September last, and, in answer to an interjection made by him while I was speaking, I said that I entertained considerable doubt as to our right to bring within the scope of the Bill public servants other than, those engaged4 in industrial enterprises carried on by the Governments of the Commonwealth and the States. We propose to bring within the scope of the Bill, first, the railway servants of the States, and, secondly, all other servants of the Commonwealth or of the States who are engaged in industrial enterprises carried on by those Governments.

Mr Willis - Will the carrying of that proposal be regarded as of vital importance ?

Mr WATSON - That will be a matter for the Government to consider when the occasion arises. I have never made the matter one of vital importance, though I shall have excellent examples in the conduct of honorable gentlemen opposite of longer experience in politics, to justify any stand I may take in the matter. So far as that part of the Bill is concerned, honorable members may be sure that we shall show a proper appreciation of our constitutional position. At the same time I do not think it is a proper thing to attempt to coerce the House by making threats as to our attitude on a question of this sort.

Mr Reid - Much better leave it to the caucus.

Mr Batchelor - Which caucus ?

Mr WATSON - I have protested time and again against a position of that kind being taken by Ministers, and in September last, when the Bill introduced last session was dropped by the late Administration, I took the stand that they had no right to make a matter of detail a Government question. At the same time, I will not now say what attitude Ministers will assume if the measure is not amended in the direction they propose.

Mr Deakin - To the members of the late Administration the matter was one, not of detail, but of principle.

Mr WATSON - I admit that the honorable and learned gentleman had the right to distinguish between details and principles. For my own part, I expressed the view as far back as six or seven months ago that the matter was one of detail, and, therefore, if occasion arises, I shall be free to take any course without going back upon principles already enunciated. Another alteration of considerable importance which we propose to make in the Bill' is in providing for the appointment of only one permanent member of the Court, the Justice of the High Court, who will preside. We propose to eliminate those provisions of the Bill which make the two assessors permanent members of the Court. There are various reasons for this change, though I shall not now more than briefly outline them. In the first place, we must be guided to some extent by the experience of other Governments who have similar legislation to administer; and we are aware that grave dissatisfaction exists amongst a large proportion of those affected by the decisions of the New South Wales Arbitration Court because the cases brought before it are adjudicated upon by assessors who know nothing whatever of the technical details of the industries in regard to which the disputes arise. That dissatisfaction has, in many instances, culminated in the expression of lack of confidence in the constitution of the Court. We, therefore, think it desirable to appoint additional members of the Court, or assessors as they may be more properly termed, selected for each dispute by the parties concerned; but if both parties are satisfied to abide by the direction or decision of the Judge alone, no assessors will be appointed. Another aspect of the question to which attention may be directed is that the measure has been framed for the prevention rather than the cure of industrial disputes. We hope that the existence of the Court will obviate the need for large expenditure to bring its machinery into active operation, and, if we are justified in that assumption, it will be unwise to provide for an elaborate tribunal with all the paraphernalia of an ordinary Court of Justice, before which, perhaps, no case will be brought for some considerable time. For these reasons we consider ourselves justified in proposing, at any rate as an experiment, that the Court shall consist ofthepresiding Justice and special assessors chosen by the parties concerned, whenever they think them necessary. Another amendment which, perhaps, will not be quite so popular among honorable members belonging to the learned professions, will prevent the appearance of counsel before the Court without the consent of both parties to a dispute. The experience of the trades unions of New South Wales is against the appearance of counsel. It is true that the presiding Judge there has expressed the opinion that counsel have occasionally assisted him in arriving at a clearer conception of the causes of disputes, but, on the other hand, in New Zealand, where a similar Act has been in operation for a much longer period, experience shows that disputes are investigated at a much lower cost than is the case in New South Wales. When I visited that Colony recently, I was assured by those interested that in many instances large and important disputes have been disposed of at a cost of not more than £10.

Mr Wilks - The honorable gentleman is killing the business of the Minister for External Affairs.

Mr WATSON - Both the Minister for External Affairs and the Attorney-General have shown a patriotism in regard to this matter which is worthy of imitation. These, are the principal alterations, but there are many others with which honorable members may make themselves acquainted by consulting the schedule of amendments which is now being circulated. We believe that with these amendments, we shall be able to pass the Bill through this Chamber within a reasonable time, and send it to another place, where I have every reason to believe that it will receive a cordial reception, with the result that the measure should become law very shortly. Another proposal is to introduce, as the first measure in the Senate, a Federal Capital' Sites Bill. No one in the community has appreciated more than I have the immense influence which the selection of the Federal Capital site should have in largely dissipating the interprovincial jealousy existing, more particularly between the two larger States.

Mr Kingston - Hear, hear.

Mr WATSON - In New South Wales we have been fully able to appreciate just how far many questions have been prejudiced by the mere fact that they were first proposed in Victoria> and during the three years in which I have resided mainly in Victoria I have come to the conclusion that that feeling is just as pronounced in this State as in my own. In view of this fact, I feel sure that we cannot expect any great diminution of this unfortunate feeling until we settle the question of the Federal Capital site, and the Parliament is removed from those sinister implications as to the influence which is exerted in one or other of the two great cities of the Commonwealth. Moreover, I believe that a settlement of the question will tend to encourage the growth of a larger and broader national feeling than that which has hitherto existed in regard to Federal politics. I admit that it ' is said that the establishment of the Federal Capital involves a large expenditure. Eventually, no doubt, the outlay of a very large sum will be involved, but if, in the council's of the nation we have economically minded men, who are content 'to work on a common-sense basis, and to always cut their coat according to their cloth, there need not be any large expenditure in this connexion for some time to come. I am informed that the Victorian Parliament was content for twenty years with an expenditure of ^20,000 upon the buildings in which we are now sitting. In the first instance, the complete design was put forward, but only the two legislative halls were erected. Some temporary adjuncts were also provided, and the Parliament was content with this accommodation for twenty years after the introduction of responsible government. Somewhat similar lines might well be followed in regard to our accommodation at the Federal Capital. We should first, I think, adopt a definite design, which would leave room for no mistake that could be foreseen by human prescience, and which would permit eventually of grand and noble edifices being erected, which would, do credit to, and be worthy of Australia. For the present, however, we might very well be satisfied with buildings which, whilst serving our immediate purposes only, would be in consonance with the complete plans agreed upon. Therefore, I think that the general statement that the establishment of a Federal Capital would involve extravagance and waste of money is not justified. Judging from my experience of the past- three years, I venture to think that whatever Government may be in power, when expenditure upon the Federal Capital is proposed, the House is not likely to support any extravagant expenditure, or the outlay of anything beyond the sum absolutely necessary for carrying out the Federal scheme. One feature of the proposed Bill will be a provision that the area to be selected shall not be less than 30 miles square, or 900 square miles, and it will also be provided that' the land so acquired shall not be alienated.

Mr Skene - Why "30 miles square " ?

Mr WATSON - We mean 30 miles square or an equivalent area. The shape of the Federal territory will not matter. As was agreed by this House last session, the idea is that the area shall not be less than a certain minimum. It does not matter whether we speak of 30 miles square, or 900 square miles. We hope by the means I have stated to retain for the benefit of the Commonwealth - and the Commonwealth means the tax-payers of Australia - all the unearned increment that accrues through the expenditure of the tax-payers' money, and I have yet to be convinced that when the matter is put fairly and squarely before the people of New South Wales there will be any grave objection on their part to such a course being followed by the Federal Parliament.

Mr Willis - Oh, yes, there will.

Mr WATSON - That is a matter of opinion. In my constituency, which has not a site to offer for the Federal Capital, my views have been indorsed by the result of the general election.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - The Prime Minister's constituency is very close to one of the proposed sites.

Mr WATSON - I do not think that that affects the question. My opponent entertained views similar to those which I have expressed. It is the intention of the Government to push on the Bill through all its stages in this House, after it has passed the Senate.

Mr Reid - The Bill is to be introduced in the other Chamber?

Mr WATSON - Yes, as the first measure. We could not introduce it into this House for some time, because of the Arbitration Bill, and we propose to put it forward as the first measure for consideration in the Senate.

Mr McColl - Will the Government name the site?

Mr WATSON - No. I should very much like to arrive at a Ministerial decision in that respect, but I think that in view of the fact that members of the Government, in common with honorable members generally, took up a decided attitude with regard to the sites when the Bill was before us last session, it would be too much to expect us to submit a definite proposal.

Mr Skene - Will the Government confine themselves to two sites?

Mr WATSON - No, we shall not. I think that every site which has a chance ought to be open for selection by a new Parliament; but I do not expect that any great number of sites will have such chances as would encourage their supporters to persist in thrusting them forward.

Mr Chapman - There is only one site in it.

Mr WATSON - I think so, too.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Has the Government any idea as to the means which ought ! to be adopted in order to reach finality on ! the question? ,

Mr WATSON - I do not think there is j any likelihood of a protracted dispute be- I tween the two Houses. I am glad to say, on behalf of the Labour Party, both in this House and the Senate, that they are determined to push this matter through as a national question. Owing to the strength of the party in the Senate their help in that Chamber'' ought to be of material assistance in the settlement of the question.

Mr Chapman - Will the Minister bow to the will of the majority of his party ?

Mr WATSON - I shall, decidedly. I have- always done so. I do not anticipate that the will of the majority will be in favour of the site advocated by my honorable friend ; but in any case I shall abide by the will of the majority. After the Bill is passed, it is the intention of the Government to enter into communication with the New South Wales Government, with a view to having the areas proposed as sites for the Federal Capital specifically set apart for the purpose.

Mr Reid - The Government do not propose to make the proposed area of 900 square miles an absolute sine qua non ?

Mr WATSON - No, our representations will take the same form as those which were made by our predecessors. We shall indicate the desirableness of setting apart the area specified. ,

Mr Reid - But the Government will not make it an absolute condition.

Mr WATSON - No. That is a matter for negotiation, and I hope that we shall be able to arrive at an amicable understanding with the State authorities. On the initiative of the late Minister for Home Affairs, contour surveys of the proposed sites at Dalgety, and in the neighbourhood of Tumut, were undertaken some little time ago. These reports are now available, and will be laid upon the table of the House to-morrow. Therefore, honorable members will almost immediately have an opportunity to peruse the reports of the surveyors, and arrive at a more definite understanding of some of the details.

Mr Fuller - Has a contour survey of the Lyndhurst site been made?

Mr WATSON - No. The honorable and learned member will recognise that we are not responsible for what has been done. The surveys were initiated by the late Minister for Home Affairs, and we have not had time to arrange for any further surveys. Personally, I am familiar with the Lyndhurst site, and I do not think there is any grave necessity for a contour survey. Its general features are well known to be quite suited for the purpose of. a Federal Capital.

Mr Willis - It is the best.

Mr WATSON - No doubt there is a good deal to be said on that point. I believe, however, that even if we had time there would be no necessity to engage in a contour survey of the Lyndhurst site. Another measure which we intend to introduce is the Trade Marks Bill, about which there can be little difference of opinion. I confess that I do not understand why it was not introduced as a necessary corollary of the Patents Bill. I know that in the States trade marks legislation has been worked in conjunction with that relating to patents without involving any additional expense. I think, therefore, that a Trade Marks Bill might have been introduced at the same time as the other measure.

Mr Deakin - It was left alone in order to avoid delay in the passing of the Patents Bill.

Mr Kingston - The Patents Bill was big enough by itself. It would have been a huge work if the other measure had been included.

Mr WATSON - No doubt that is true. Still, I have always regarded the federalization of trades marks as a necessary corollary of the patent law, and I think that under Federal administration such legislation should involve very little extra expense. We have to keep up a staff for the purpose of administering the Patents Act, and we could deal with trade marks by means of the same staff at very little, if any, extra expense. The next Bill with which we propose to deal is that relative to the appointment of a High Commissioner in London. . I do not think I need say more at this stage than that, in the first place it. was contemplated by the Federal Convention that such an officer would be appointed to voice in a distinct way the feelings and aspirations of Australia before the great nations of the world, and particularly in connexion with our relations to the British Government. We are told, in some quarters, that this proposal involves another extravagance on the part of the Federal Government. My own view, however, is that, so far from involving extravagance, it should afford means of economising if the States Parliaments rise to the possibilities of- the situation. In the first place, we require 'such an officer' to properly represent the feelings of Australia with regard to those great questions of current importance which are always cropping up in London. ' We have interests in the South

Pacific, . and elsewhere in the southern hemisphere, connected with trade and other matters, which are constantly requiring attention, and we cannot rely for an adequate representation of our views with regard to such matters upon the AgentsGeneral, who are responsible only to their respective States Governments. If a High Commissioner were appointed within a comparatively short time the States Parliaments should be able to abolish the offices of their Agents-General and substitute for them, probably, some form of commercial agent, with an inferior status and a much less expensive establishment in the capital of the Empire. That should lead to material economies, having regard to the cost to which the States are put in maintaining AgentsGeneral, each with his secretary, his staff of clerks, and the whole paraphernalia of a Department resident in London, each largely duplicating the work of the other. During the last three years most unfortunate misconceptions have arisen on various occasions as to the scope and intention of legislation passed by this Parliament. On various occasions the people of Great Britain - I will not say because of ignorance, but because of misapprehension as to the intention and effect of such legislation - have shown an altogether false conception of trie general trend of Australian politics. It would be, in my view, most unfortunate if, having the opportunity .to correct that state of affairs, we neglected to avail ourselves of it, simply because of the raising of the parrot cry of extravagance. It should be open to the States to replace their Agents-General by commercial agents, and if they so desired to avail themselves of the services of the High Commissioner as a financial adviser. We presume, of course, that a man of high attainments will be appointed to the office of High Commissioner. Such a nian would be able to act as financial adviser to the Governments of the States, and, if they so desired, to deal with the inscribing of their loans and the payment of interest on their debts. In addition, the High Commissioner would be able to give assistance in the carrying out of the immigration proposals of which we have heard so much of late. I know that a number of the States Governments are anxious to second the work initiated by the late Prime Minister, in respect of immigration. I am sure that we all are most anxious that Australia, with all its resources, should be made known to the people of Europe, and more particularly to the people of Great Britain ; but it seems to me that it will be impossible to bring about that happy consummation unless we have some one in London who can speak on behalf of Australia generally, and also work in harmony with the Governments of the States in relation to the necessary measures that must be passed by the States before emigration to this continent can assume any large proportions. For my own part, I feel that unless the States Governments are prepared to cooperate with us - and to co-operate in no uncertain way - it is useless to expect anything in the way of a large immigration for some time to come. The key to the position is held by the States Governments.. They have control of the lands of Australia, and unless those lands are made available- unless they are opened up and their possibilities advertised in places where farmers, or would-be farmers, are to be found - we need expect for some years hence but little advance in the way of immigration. With a High Commissioner as energetic and as far-seeing as is Lord Strathcona in the representation of Canada - with a representative of like abilities and energy - we need have no fear.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - A Commissioner with similar means?

Mr WATSON - I feel that it would be necessary for the Commonwealth to make adequate provision for the office.

Mr Reid - Might I suggest that ihe Government could not find a man of wider knowledge for the office than is the honorable member for Darwin.

Mr O'malley - The appointment should be given to the right honorable member himself.

Mr WATSON - The honorable member for Darwin has already informed me that he would be quite willing to give way to the right honorable gentleman opposite. He recognises that from our point of view a great benefit would be conferred on Australia if the right honorable member were sent to. London.

Mr Reid - If we went together we should, at all events, have a happy time.

Mr WATSON - I do not think it is necessary to say any more in this regard, save that the Government feel that it is essentia], from all points of view, that the appointment of a High Commissioner should be made at the earliest possible date. We intend to re-introduce,- with very little alteration, the Bill introduced in the Senate by our predecessors in regard to fraudulent trade marks. The principal alteration will be in the title of the measure. The Bill was known as the Merchandise Marks Bill, and we propose that it shall be entitled the Fraudulent Trade Marks Bill. Its object will be to prevent a continuance of the commercial immorality which is practised at the present time both by- importers and manufacturers.

Mr Wilks - That is a' big order.

Mr WATSON - I do not say that we can, beyond all doubt, insure the removal of iniquities of this description; but by passing some such measure as I have indicated we shall be able to minimize them. I do not wish to detain the House by giving detailed descriptions of the frauds which the Customs Department has traced in connexion with many branches of industry. I may say, however, that it has been found, for example, that cotton, goods are sometimes sold as linens; that socalled woollen goods have in some cases consisted almost entirely of cotton, while in other cases there has been a larger admixture of cotton; that jewellery marked 1 8 carat was in reality only 9 carat; and that alleged lime-juice - bearing, I am sorry to say, the brand of " Parramatta "-


Mr WATSON - I trust that it was a libel on Parramatta. My own conviction is that it never saw the district which the honorable member so worthily represents. The fact remains, however, that this alleged lime-juice contained no lime-juice whatever, but was found to consist of acids and water. . A thousand and one instances of these evil practices might be given, and I feel that the measure which I have indicated, while not involving any party question, will be of material value to the community. Another measure with which we propose to ask the Parliament to deal is a Bill relating to Papua. It will be mainly on the lines of the measure introduced by the late Government, but one or two small alterations will be made.

Mr Reid - What will the Government do with their coloured labour dependency ?

Mr WATSON - Had the right honorable member been present a year or two ago when we dealt with the taking over of Papua, he would have known that I expressed grave doubt at that time, as to the propriety of thus widening our sphere of responsibility. We have an enormous territory to adequately defend and develop, and although I did not press the question to a division, my own opinion at that time was that it was unwise to enter upon a quasiImperial policy at such an early stage in the career of the Commonwealth j but it is now too late to discuss that aspect of the question. We have assumed the responsibility, whether it is wise or not, and that being so, the duty lies upon us as men to carry it out to the best of our ability. We have to do our utmost from a humanitarian stand-point for those who are now in Papua. I am sorry to say that, so far as appearances go, recent occurrences in Papua have not increased our chances of impressing the native population with the unswerving firmness and justice of our control. That, however, is a matter which will be- inquired into at a .later stage. At present, owing to the lack of necessary legislation, developmental work is absolutely suspended in the dependency. We are holding the territory in a most extraordinary way. We control it under an Order in Council of the Imperial Government, which allows us a nominal authority, but actually gives us very little control, and until the Parliament passes some measure sanctioning a govermenta organization for Papua, it will be impossible to secure adequate development of the territory.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Why should we be so anxious to develop Papua? Have we not plenty to do in Australia ?

Mr WATSON - I agree that we have ; but if for no other reason than that we should do our duty to the native population of Papua, it is necessary that we should spend a large sum of money in the dependency. Our finances will not permit of an adequate grant without any return, and, therefore, it seems to me essential that we should give reasonable opportunities to those who desire to settle there - under proper conditions - on land which has already been acquired upon equitable terms from the natives themselves. . This land, at present, is not being utilized, and it appears to me an unfortunate thing that we should be spending some ,£20,000 on the maintenance of the government of the territory and getting practically no return. We propose to amend the Bill as introduced by the late Government, by introducing clauses dealing with the question of land tenure, and declaring that no land shall be alienated. They will enable the general terms of the leases to be fixed by the

Governor in Council - that is practically the Legislative Council of Papua - with a general direction as to drawing a distinction, so far as periodic reappraisements are concerned, between urban and rural lands. We recognise that, so far as town lots are concerned, we may be able' to secure settlement, notwithstanding that we insist upon comparatively frequent reappraisements of the rentals. But in regard to rural settlement, we consider that it will be essential in the first instance to offer the pioneers who are willing to improve the country which is largely malarial, heavily timbered, and very expensive to work, some encouragement by giving them long preliminary terms at pepper-corn rentals, and without re-appraisement. The leases, however, will be subject after the expiry of the first period to re-appraisement at fixed intervals. Our desire is that a distinction should be drawn between urban and rural lands, and beyond that it is unnecessary to go in the Bill itself.

Mr Mauger - What will the Government do with regard to the resolution passed by the House in reference to the prohibition of the drink traffic in Papua?

Mr WATSON - We do not intend to take any action in regard to the drink question there.

Mr Mauger - But will the Government abide by the decision of the House?

Mr WATSON - We are so anxious to secure the passing of the Bill that we certainly shall abide by the decision of the House in regard to that question. It is not a party question, and although I should regret to see the Bill amended in the direction 'indicated, I do not think we should be justified by any such consideration in further delaying the. granting of a Constitution to Papua, and thus retarding its development. If such an amendment is carried, I feel sure that it will be demonstrated within a comparatively short period that the principle is inapplicable to a community such as that of Papua, but even if there is a majority in both Houses in favour of the proposition referred to, it will, nevertheless, be our duty to get the Bill passed. The feeling of those at present residing in Papua, and who are not whisky drinkers to any extent, is strongly favorable to the admission of intoxicating liquors under proper restrictions. But I do not intend to deal with that matter at the present stage. Let me say further, that we purpose introducing a Postal Bill to correct minor defects in the

Postal Rates Act, and to deal with postal matters generally. I may say here that we propose removing the prohibition of the employment of the aboriginals of Australia contained in the coloured labour section of the Post and Telegraph Act. So far as I am personally concerned, the existence of that prohibition is a pure inadvertence. It was never intended that by any prohibition of coloured labour we should place the aboriginal natives of Australia at any disadvantage or interpose any barrier to their employment. I do not say that they are people who may be safely intrusted with contracts; but if it is found that contractors desire to employ them we have no desire to interfere in the slightest degree with their employment. Having touched upon the question of coloured labour, I may be permitted to say that I am in a position to correct a- misapprehension which has been spread very largely throughout Australia during the last few months in connexion with the insistence upon the employment of white labour under 'the general mail contracts between Australia and England. Some time ago the late Postmaster-General called for tenders for new contracts for the carriage of mails between Australia and the Motherland. The honorable gentleman, unfortunately, in my view, did not see his way to publish the details of the tenders received. My colleague, the present Postmaster-General, has since given particulars of the tenders to the public.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - And very properly, too.

Mr WATSON - I had an opportunity of interviewing Mr. Anderson, the manager of the Orient Company, at Sydney, on Saturday last, and obtained from him direct particulars, not only as to the price at which the company would be prepared to carry the mails, but also as to the reasons by which they were, actuated in asking for a much higher subsidy than they had previously received.

Mr Deakin - He was preparing that information at my request two months ago. I asked him to let me know exactly what he thought would be the extra cost involved in the employment of white labour only, and also the grounds upon which he asked for any increase at all upon the company's previous tender.

Mr WATSON - I am glad to hear the statement of the' ex-Prime Minister. It is quite .in accord with what Mr. Anderson told me. He admitted that he had prepared the information which he gave me at the request of the honorable and learned gentleman. Some perplexity, however, still exists in my mind iri the endeavour to understand why the honorable and learned gentleman, who had so manfully shouldered the responsibility for the white labour section of the Post and Telegraph Act, had not communicated to (he public the reasons which lay behind the. request of the Orient Company for an increased subsidy.

Mr Deakin - Mr. Anderson promised to put his statement in writing.

Mr WATSON - I understood that the honorable gentleman had received the communication before vacating office.

Mr Deakin - I had not at that time.

Mr WATSON - Mr. Andersonshowed me a letter which the honorable and learned gentleman should have received before he left office.

Mr Deakin - I received a letter containing some particulars about so much a mile.

Mr WATSON - Yes ; and I understand it also contained other particulars. From the account of an interview with Mr. Wesche, of the P. and O. Company, which is published in the Argus this morning, I presume that Mr. Wesche communicated with Mr. Anderson, and there is this statement made -

Mr. Andersonhad stated that the information given by him to the Prime Minister was not supplied with the view to publication ; but of course Mr. Watson was the one to decide whether or not it should be made public.

That would appear to contain an implication that in giving certain information to the press I have divulged something which was given to me in confidence. That is not correct, and I feel sure that Mr. Anderson never intended to give colour to such a statement. What occurred was this: Mr. Anderson told me that he had prepared for the late Prime Minister certain information, and he submitted to me a copy of the letter, together with other particulars. It is quite correct to say that the statement given to me was not prepared for publication ; but after Mr. Anderson had submitted the information to me, I asked him whether I should be at liberty to make public the particulars contained in the document which he gave me, and he said that I might do so if I considered it necessary.

Mr Kingston - That is what he admits.

Mr WATSON - Yes ; but the statement' which I have quoted from the Argus may leave the impression, in some minds, that I received something under the seal of confidence, and then exercised my own judgment in making it public.

Mr Kingston - Mr. Anderson says the honorable gentleman was entitled to do what he did.

Mr WATSON - I can say that I was, because I asked Mr. Anderson's permission to make the documents public. 1 am justified now in stating with authority that the demand for an increased subsidy by the Orient Company has not been due to the insistence of the Federal Parliament upon the employment of white labour only upon mail vessels. Mr. Anderson, as representing the Orient Company, admitted at once that if they were permitted to employ any labour they chose, they would still, under existing conditions, have to ask the same sum for the carriage of mails.

Mr Kelly - Did he not say that the company would look for some allowance to be made in certain cases where the boats were late ?

Mr WATSON - Not an allowance in cash. He said that if the steamers were late, because of desertion on the part of the crews, the company would ask to be exempt from any penalty so long as that could be proved. That is a minor matter. But the idea which has been sedulously fostered throughout Australia has been that the extension of the White Australia principle to the mail vessels has led to an increase of 100 per cent, being asked for the carriage of mails. That 1 wish to deny absolutely on the authority of a man who is in a position to know the facts. Mr. Anderson stated, that the facts were that - the Orient Company being paid only at the rate of 2s. 7d. per mile, it was impossible for them to compete with the P. and O. Company getting 4s. 7d., counting all their services to India, China, and Australia, and whilst the German Government were paying a subsidy of 6s. 8d. per mile, and the French Government over 8s. per mile. He says in his memorandum that the service to Australia pays only during some five months in each year, and that it is impossible for them, to continue a regular service through the canal in view of the enormous canal charges and other expenses involved with either white or black la*bour unless they get a subsidy of at least ^150,000 a year, as Compared with a ' subsidy of ^86,000 a year paid at the present time. Whether it is wise for us to pay this increased subsidy in order to secure the additional facilities afforded is a matter which any Government will have to consider very carefully before coming to a decision. There are many interests concerned. We have to look to the interests of the producers in the rapid carriage of perishable products, and we have to ascertain how far their requirements may be met by services other than those concerned in the carriage of mails under present conditions. The interests of the producers and of the commercial community on the one hand, and of the taxpayers of the Commonwealth on the other, are such that we must have further time to consider the question before arriving at any decision. Another Bill which we intend to introduce is one to provide for a survey of the Western Australian railway. I am sure that our friends from Western Australia will be gratified to hear that. I have been in communication with the Premiers of South Australia and Western Australia for some days past in connexion with this matter. I shall have the pleasure at a later stage of laying upon the table a copy of the correspondence which has passed by wire between the Premier of South Australia and myself in this connexion. The effect of it is that- Mr. Jenkins' Government is prepared to permit a survey to be made.

Sir John Forrest - We knew thai before.

Mr WATSON - I am aware of that. But I was hoping that we should have received a little more from the Government of South Australia. I am sorry that the Premier of that State has not gone as far in the matter as I desired; but he is prepared to consider the question of allowing the construction when the survey has demonstrated that the cost will not be excessive. That is the most that I could get from him. With regard to the correspondence between Mr. James and myself, I am not yet at liberty to place that before the House. ' In its preliminary stages it has been confidential ; but I am justified in saying that I have every reason to believe that the Government of Western Australia will be willing to act liberally in regard to any, possible loss that may accrue after the railway is constructed. Under these circumstances I feel that we are justified in asking the House to carry the proposed Survey Bill. I do not think it should be held to commit either the Ministry or individual members of the House to carry through the construction of the railway at a later period, unless the circumstances as then known are found to be such as will justify the large expenditure involved. But so far as the present proposal is concerned it does seem to me that in view of the manner in which persons, who perhaps said more than they were entitled to say with authority, encouraged the citizens of Western Australia to hope that this transcontinental railway would be undertaken, we are justified in having a survey made to demonstrate beyond all doubt what the cost of the construction of the line will be, and also what is the character of the country through which the proposed railway will go. On this head we have a remarkable diversity of opinion amongst so-called authorities. But we are aware that no flying survey, which merely traverses one line of country, and shows nothing of the country north or south of that line, can satisfactorily determine the question whether country which is said to be likely to add another province to Australia if opened up, will really bear that description or not.

Sir Langdon Bonython - What is the present estimate of the cost of the line?

Mr WATSON - Something over £4.000,000. The cost of the survey, I understand, would be about £20,000. I think that from an exploratory stand-point alOne we should be justified in incurring some expense upon a survey, even though the railway should not afterwards be built. Mr. Johnson. - What is the route proposed? Is it the coastal route?

Mr WATSON - I understand that the Tarcoola route is the one proposed. Before the Bill is introduced the Government will consider the question whether the prospects of Tarcoola justify the line being taken that way. If there are sufficient mineral and other prospects discovered in the direction of Tarcoola, we should, no doubt, be justified in so deviating the line as to take them in. That is a matter for consideration, and it would not involve a great increase in the cost of survey to have both routes included one out and the other in, one via Tarcoola, and the other via Eucla and Port Augusta. My own information, I admit, is that the difficulty of finding sufficient, water is a very great one. But it would seem extra-

Ordinary that where the country is said to be good, and where there is a sufficient rainfall to secure a fair spring of grass, it should be impossible to conserve water at a moderate cost. In western New South Wales we have had experience in conserving water in most unlikely places, and I am glad to say that we have in many instances succeeded in doing so at a cost commensurate with the benefits gained. We also intend to introduce an amending Electoral Bill, to deal with a number of minor defects which have been discovered in the working of the Commonwealth Electoral Act. For instance, we intend to provide that bribery on the part of a candidate standing for election shall be sufficient to. invalidate his election and to prevent him from taking his seat. When the existing Electoral Act was passed I think that the . House inadvertently omitted to bring that offence within the purview of the High Court. So far as the obiter dicta of the Court goes it would appear that we omitted to take that precaution.

Mr Wilks - What about a redistribution of seats?

Mr WATSON - My colleague, the Minister for Home Affairs, has already taken steps to have the rolls in New South Wales and Victoria revised, but I do not think that the other States are at present affected, although it may, perhaps, be found that Queensland is entitled to another representative. In regard to the two States in which there is an admitted necessity for a redistribution of seats, the Minister for Home Affairs has asked their respective Governments to assist us by means of the police in collecting accurate rolls on the basis of the Federal franchise. We recognise that a re distribution is necessary, but, before anything is done in that regard, accurate Federal rolls must be collected in order to give the Commissioners who will have to be appointed a proper basis to work upon. My honorable colleague informs me that, generally speaking, the difficulties in regard to enrolment exist only so far as New South Wales is concerned, the Victorian rolls having been specially collected, and being therefore fairly accurate.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - When are the Government going to pay the men' who did the work of the last elections?

Mr WATSON - In every case, where no attempt at an overcharge has been made, payment, so far as the head office knows, has been made.


Mr WATSON - Then the honorable gentleman had 'better see the- Minister for himself. I am informed that in one or two cases the claimants are being compelled to substantiate their charges in the Courts, but in those cases what are regarded by the Department as absolute overcharges are being made.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - I am speaking of cases in regard to which there is no dispute.

Mr WATSON - I am assured that in every case of that kind the account has been passed for payment. The money is available, and there is no reason why these accounts should not be paid.

Mr Wilks - Do the Government favour equal electoral districts?

Mr WATSON - Yes; so far as practicable.

Mr Wilks - And the States are to be redistributed to bring that about?

Mr WATSON - Yes.

Mr McColl - The Government will not find the rolls in the northern districts of Victoria anything like accurate.

Mr WATSON - The Minister for Home Affairs has already taken steps to see if the rolls in some parts of Victoria are accurate, and, where sufficient reason is shown, that action will be extended to other parts of the State. The Bills to which 1 have referred constitute practically our programme for the session.

Mr McCay - When is the session to end ?

Mr WATSON - Although I have occupied perhaps an unjustifiable length of time in referring to these measures, a number of them are measures which are not affected by party opinion. A few, such as the Conciliation and' Arbitration Bill, will occupy us for some time; but most of them should not require lengthy discussion, and I have no doubt that when they come to be considered, they will be dealt with in a comparatively short space of time.

Sir William Lyne - Do not the Government propose to do something in connexion with the Navigation Bill?

Mr WATSON - I am about to refer to that measure ; but I wish first to speak of the Inter-State Commission. On the initiative of the late Government, ' the Premiers of the States were asked to bring before the Conference of Railways Commissioners which recently met in Sydney the question of preferential, differential, and competitive rates, with a view to seeing how far existing grounds for complaint' in regard to them could be removed. I have since followed up that action by telegraphing to the Attorney-General for New South Wales, asking him to be good enough to bring the matter under the notice of the Railways Commissioners again, so as to insure action being taken if possible. In reply, I have been informed that resolutions, which are not yet available, but which I hope to have before me shortly, were passed, which tend to show a reasonable probability of these rates being so ' minimized as to remove many of the complaints which have so justifiably been made against them. My hope is, that, by getting the Railways Commissioners to mutually agree to the abolition of preferential and differential rates, we may largely obviate the necessity for the appointment of an Inter-State Commission. None of us deem it wise to incur avoidable expenditure, and it is my conviction that the Inter-State Commission, if it be found necessary to appoint it, will have no work to do after it has been in existence for twelve months, assuming that its members display a reasonable diligence in addressing themselves to the task before them. Once they have settled upon a line of policy respecting Inter-State rates, it is reasonable to expect that the Railways Commissioners will not needlessly and carelessly come into collision with it, knowing the power of the Commission to enforce its determinations. Once a policy is announced by the InterState Commission, it will be conformed to by the Railways Commissioners, so that the members of the Inter-State Commission will have nothing further to do, until the lapse of a long interval of time. I admit that other matters besides railway rates would come within the scope of the Inter-State Commission. We have at the present time an anomalous condition of affairs with respect to wharfage rates.


Mr WATSON - Yes.

Sir William Lyne - And in respect to shipping freights, too.

Mr WATSON - I do not think we have the same necessity to interfere in regard to shipping freights ; but, as regards wharfage rates, there is no doubt that in some of the States local products are allowed to be landed without charge, or at lower charges than those imposed upon imports from other States. That is an undesirable condition of affairs, and amounts to a preference opposed to the spirit and letter of the Constitution. But if we succeed in removing by mutual arrangement between the Railways Commissioners most of. the difficulties at issue, surely similar good sense will be shown by the authorities responsible for wharfage rates. If we are able to put before the Governments of the States the alternative that, if they do not take action in removing the anomalies complained of, and cease from imposing improper charges, they will be responsible for imposing upon the citizens of the' Commonwealth an expenditure of many thousands of pounds a year, most of them will, in my view, see the need of coming to an understanding which will remove the causes of complaint. Even if they do not, there is another alternative which I think worthy of consideration, and which the Government has under attention at the present time, and that is to appoint as members of the Inter-State Commission, not outsiders with salaries ranging from £1,000 to £3,000 a year, but State or Commonwealth officers, who will be able to conform to the provisions of the Constitution, but who will not require large increases of salary for the performance of these additional duties. It may be objected to this suggestion that we should be relying upon persons who have not the required calibre to deal with the important questions which will come before the InterState Commission, but I do not think that that objection will hold good. Notwithstanding my limited acquaintance with, the important public officers of the Commonwealth and of the States, I know quite a number whose long experience, probity, and keen judgment would commend them to the public as fitted to occupy these important and distinguished posts. Therefore, if it is found necessary to appoint the Inter-State Commission, it may be done without involving the Commonwealth in any large additional expense. Another question which must be considered in this regard is the control of the waters of the Murray. At present an unpleasant degree of friction exists in respect to this matter. The people of South Australia insist that there should be no diversion which might prevent a large minimum flow of water through that State at every period of the year, and, whilst, on the one hand, the Commonwealth authority is charged with the duty of controlling navigation, it seems to me impossible for us, at the- present time, to come to any determination as to the limits to which other States may go in regard to the reasonable conservation of water for irrigation. Therefore, some authority which will be able to pronounce judicially between these contending interests must 'be set up. That, in itself, may constitute a reason which will ultimately necessitate the appointment of an Inter- State Commission on an inexpensive basis. However, our policy is to avoid, as long as possible, the incurring of any expense in the matter, and I hope that, in any case, there will be no need to appoint a large or expensive Commission. The Navigation Bill, introduced in the Senate by the late Administration, contains, as honorable members are aware, some hundreds of clauses, and as Ministers have naturally been busy in acquainting themselves with the detailed work of their Departments, and in the consideration of other measures, it would be unfair to expect us, within the short time at our disposal, to have dealt thoroughly with this measure. We see in it, however preliminarily, large grounds for objection, and have, therefore, decided to relegate it to a small Royal Commission. The appointment of such a Commission has been asked for by all sections of the community. The unions with which I have been indirectly associated have been almost unanimous in asking for its appointment. They contend that the Bill contains clauses which they regard as objectionable, and does not contain clauses which they regard as essential for the proper carrying on of the shipping industry. Other sections of the community have an interest in this matter, and each of them have put forward their representations. I do not favour- the appointment of an undue number of Royal Commissions, and certainly I should not approve of a large Royal Commission in this instance, because a. large body almost invariably leads, to delay in the presentation of the report* and difficulty in arriving at anything like a unanimous finding. Therefore, our view is that a small Royal Commission should be appointed to consider this most important question. We should expect a progress report very soon* and a final report within at least a few months of their appointment, but apart from any such final report we should be prepared to introduce a Bill next session. Every step will be taken by the Government to insure the presentation of the report to the GovernorGeneral in ample time to allow Ministers to digest the recommendations, and the evidence, and to, if possible, meet the objections raised to the measure by those who are held to possess particular information upon the points, at issue.

Mr HUME COOK (BOURKE, VICTORIA) - Do the Government propose to do anything in regard to the iron industry ?

Mr WATSON - Not at present. Another measure with which we hope to deal next session is that relating to Federal Quarantine. We do not propose to introduce it at present, for the reason that the Minister for Trade and Customs has asked the States Governments to allow the heads of their Health Departments or other duly authorized officers to attend a Conference in Melbourne, with the object of assisting him in arriving at a decision as to the most economical as well as the most effective manner of treating the question. This is largely a professional and departmental matter, and does not involve any political question. We have already received a reply from the New South Wales Government 'to the effect that they are quite agreeable to send an officer to assist us, and I think honorable members will agree that, even if the Bill were introduced this session, it would be desirable to first submit its provisions to experts.

Sir William Lyne - That does not affect the policy of the Government. I presume that the Government have made up their minds to introduce a Bill of some kind.

Mr WATSON - Yes, our. only object is to so shape the provisions of the Bill as- to avoid friction and insure efficiency. There is one other matter with regard to the work of this session upon which I should .like to sky a word or two. Even at this early stage, I think it is desirable, as a matter of policy, to indicate to the House that the Government have, made up their minds to ask for the grant of a large sum, apart from the ordinary military estimates, for expenditure on warlike material. The impression has got .abroad in the past that the Labour Party are opposed to any adequate, provision being made for defence. We have on several occasions led an attack upon the military estimates, and have assisted to cut down, by a very large sum, the votes proposed, with results which, I' believe, afterwards proved very acceptable to the late Treasurer. Because of this, it has been assumed in many quarters that we had .no desire to see Australia defended, and did not wish to make any adequate provision . to that end. So far from that being the case, I would remind honorable members that, when the Estimates were .under consideration in 1901, 1902, and 1903, I specifically offered, on behalf of the Labour Party, to vote any reasonable sum in order to provide necessary armament, equipment, ammunition, and warlike stores generally.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Are we to understand that the Government propose an increase in the total military vote?

Mr WATSON - Yes, we do. As Treasurer, I should endeavour to cut down the military vote in some directions even below the present figures. There are some items of expenditure with which I think we might dispense for one or two years, whilst we are making special provision for warlike material.

Mr McCay - To what items of expenditure does the Prime Minister refer?

Mr WATSON - -I have not yet gone into the matter in detail.

Mr McCay - The Prime Minister might perhaps mention the class of items in regard to which he contemplates economy.

Mr WATSON - Well, I think that we might minimize the expenditure upon camps of instruction. We might substitute local for general camps for one or two years, in "order to save money, which would act as a partial set-off against the heavy expenditure upon warlike material.

Mr McCay - That has practically- been done this year.

Mr WATSON - In some respects that may be true, but, although the camps which were held this year were called local, as distinguished from one general camp for each State, they involved a large expenditure, especially for railway travelling. Of course, the railway fares are paid over to the State, but nevertheless they form an item pf our expenditure. I might mention, for instance, that the whole of the light horse from the south of Sydney were conveyed by train to the' Clarendon camp. This operation necessarily involved an enormous expense for the conveyance of men and horses.' I am not now attempting to indicate the exact lines upon which we can cut down the ordinary military votes, but, whether we can cut them down or not, I submit that it is absolutely essential that we should spend a large sum in .providing -warlike material.

Sir George Turner - What amount does the Minister propose to spend?

Mr WATSON - .£120,000, and more if I can get it. .

Sir George Turner - That is what I proposed last year. The Minister for De- 1 fence asked for £266,000, and I requested him to recast his estimates so that they should not exceed £125,000.

Mr WATSON - I am glad to know that the arguments, we put forward had some effect.

Sir George Turner - I said before that we were going to spend £125,000 - that for the first year we could afford only £75,000, in addition to what we could save in the Defence Department, but the total amount would not be very much short of £125,000.

Mr WATSON - At any rate, I propose to ask for £125,000 at least, and all I can get in addition to that amount.

Mr Chapman - Is it true .that the Government propose to cut down the expenditure upon cadet corps?

Mr WATSON - We have not arrived at any decision in the matter.

An Honorable Member. - It would be a great mistake if that were' done.

Mr WATSON - There is plenty of time in which to announce the details of our proposals.

Mr Chapman - The newspapers made an announcement to the effect I have indicated.

Mr WATSON - I am not responsible for what' appears in the newspapers. The position I take is that we must spend a comparatively large sum in providing armaments and other warlike material. There is one aspect of this question upon which I should like to say a word or two. It seems to me that at present our naval vote is an absolute waste of money. We have provided in the Naval Agreement for a contribution towards the maintenance of the Imperial Squadron. I did not approve of that agreement ; but there it is. It provides for the creation of Naval Reserves, from which the Imperial Squadron may recruit in case of necessity, and,, therefore, it seems to me that our purely local Naval Forces will form only a second reserve, and that without training. These so-called Naval Forces are of no value for harbor defence under present circumstances, because our forts are manned solely by our Military Forces. I understand that the late Minister of Defence proposed that we should secure the use of a third-class cruiser for Sydney, and others as they might be obtainable for other ports, and upon such vessels train our Naval Forces. I dissent altogether from any such proposition, because I hold that it would be absolutely impossible to properly train men upon ! a ship which dare not show its nose outside a harbor. Then there was another proposal to keep the Cerberus in commission. That vessel, even though she were armed with the most modern weapons, would be still only a floating fort, capable of proceeding from point to point only with the greatest difficulty.

Mr Reid - That would be absolutely one of the maddest of ideas.

Mr WATSON - I quite agree with the right honorable gentleman. It costs £19,000 per annum to maintain the Cerberus, and the late Government agreed to spend £20,000 in re-arming her, which was necessary before she could be considered even as a floating fort.

Mr Chapman - Is the Prime Minister aware that Sir George Sydenham Clarke approved of keeping the Cerberus in commission ?

Mr WATSON - I do not care whether he did or not. The naval experts we have in the Commonwealth are unanimous in. their denunciation of the proposal, and any common-sense individual must see that to keep in commission a vessel that could steam . only nine knots under extreme pressure, even though she were armed with the. best of guns, would be ridiculous, in view of recent developments in naval warfare. No doubt Sir George Clarke is an authority upon defence matters, but I question whether he has given that detailed attention to the harbor defences of Melbourne that has been bestowed upon them by others. We suggest that the Cerberus should be put out of commission, that the £20,000 proposed to be spent ir» re-arming her should thus be saved, and that the men engaged on her and other vessels should be transferred to torpedo destroyers to the extent to which we can afford to provide them. We may be able to hire a number to start with, but if we were only able to build one vessel per- annum, we should soon be able to train a large number of men of the so-called Naval Forces. Their training, at week ends - which is consistent with our general policy in regard to the Militia Forces - would be of such a character that it would prove of advantage if trouble arose. We should thus be able to supplement our harbor defences, and provide a force which could act on occasions as the eyes and ears of the Imperial Squadron for scouting purposes.

Mr Deakin - We proposed to make pro vision of that kind.

Mr WATSON - No doubt, but according to what appeared in the newspapers, it was proposed to hire the Mildura, or some other third-class cruiser - an obsolete boat with obsolete weapons - for the purpose of training our men to act as a second reserve for the Imperial Squadron.

Mr Chapman - Does not the Prime Minister think that it would be fairer to give the House the information contained in the Defence Department instead of that published in the newspapers, which his colleague must know to be incorrect ?

Mr WATSON - I should be very sorry to do the honorable member any injustice.

Mr Chapman - Does not the Prime Minister know that £20,000 has been saved in connexion with the Cerberus this year?

Mr WATSON - That does not affect my argument. The sum proposed to be devoted to re-arming the Cerberus has not been spent, but I understand that it was proposed to spend £5,000 immediately.

Mr Chapman - Nothing of the kind.

Mr WATSON - That amount was set down for expenditure next year.

Mr Chapman - The Minister is totally wrong.

Mr WATSON - Is it not true that the honorable member proposed to utilize thirdclass cruisers at Sydney and elsewhere for the training of the Naval Forces?

Mr Chapman - No, we proposed to provide training ships for the naval cadets, which the Government now propose to . do away with.

Mr WATSON - If my statements are not correct I withdraw them.

Mr Deakin - If the honorable gentleman turns to the papers he will find that I made inquiries both as to the cost of torpedo destroyers and submarines.

Mr WATSON - I am glad to hear it. I was giving myself credit for having hit upon a new idea, but I am glad to learn that it occurred to the honorable member before. He will, no doubt, assist in giving effect to it.

Mr Reid - We have now a member of the Ministry who has been a military man, and therefore knows something about this matter.

Mr WATSON - I was only a corporal.

Mr McCay - Did not the late Ministry leave the papers relating to this matter in the Department? "Mr. WATSON.- I presume so; but I have not seen them. 2 x

Mr Chapman - Would not the honorable gentleman have acted more fairly by looking them up before speaking in " this way ?

Mr WATSON - I shall be glad to do so, and to withdraw any statement in regard to the honorable member which a perusal of them shows I should not have made.

Mr Chapman - The honorable gentleman should examine Sir George Clarke's paper on the subject before he asserts that the scheme is a mad one.

Mr WATSON - Even Homer nodded, and even Sir George Clarke might be wrong in his judgment. The point I wish to make is that we are inviting the House to vary its policy in regard to naval defence. We contend that there is really no provision at present for harbor and coastal defence, that the Imperial Squadron, whatever reasons there were for entering into the agreement for its presence in these waters, does not provide for the coastal or harbor defence of the Commonwealth. If torpedo destroyers,, which are economical, which cost little to build or maintain, can be obtained, we shall be able to train our men on them in a way that will prove effective in the defence of Australia. We intend inviting the House to proceed in that direction.

Mr McColl - Do the Government propose to appoint a Council of Defence? The term of office of the Military Commandant of the Commonwealth will shortly expire, and something will have to be done in the matter.

Mr WATSON - Quite so. I have not yet been able to give the matter that detailed consideration that I should like to bestow upon it ; but after a cursory glance at it, I am inclined to think that we might with advantage decentralize our administration ; that in regard to the details of administrative work, to which reference was made some twelve months ago by the honorable and learned member for Corinella - the authority to spend money to secure stores from the Ordnance Department, and to deal with many other matters - we might very largely localise the administration, and thus reduce not only the friction which arises from the present system, but also the expense which it incurs.

Mr McCay - ;At present the whole tendency is the other way.

Mr WATSON - That should be altered.

Mr McCay - An officer's time is occupied for the most part in signing documents instead of in drilling his men.

Mr WATSON - I have not yet had time to go into the whole question; but my feeling is that we should, as far as possible, adopt a policy of decentralisation, converting the Commander-in-Chief, if not into an Inspector-General, at all events into an adviser as to a general policy for the Military Forces of Australia, and not allowing him to remain an administrator.

Mr Reid - If the Council disagree, who is to take action?

Mr WATSON - That is a matter of detail. I think it is only right that the House should be apprised of what measures we propose to introduce next session. As I have already indicated, we propose to introduce the Navigation Bill next session, and also a Bill relating to old-age pensions;

Mr Reid - But the Government will give full attention to the report of the Royal Commission on the Navigation Bill ?

Mr WATSON - Certainly. I think the right honorable member was absent from the Chamber when I referred to the proposed Commission.

Mr Reid - I .heard what was said. It would be idle to appoint a Commission unless the Government proposed to pay some regard to its report.

Mr WATSON - What I intended to convey when previously dealing with this matter was that we propose to appoint a Royal Commission, which will consist of only a few members - as' the right honorable member knows, a small Commission is more consistent with expeditious work than is a large one - and to invite it to get to work at once and furnish us with a report as early as possible, consistent with the preparation of an adequate statement on the question. This session must certainly extend over several months, and some months are also bound to elapse between the closing of the present and the opening of the next session, so that the Commission will have some time at its disposal. I thought it desirable, however, to make the proviso that, even if the Commission were not ready to present a final report at the opening of next session we should nevertheless introduce the Bill and thus avoid undue delay.

Mr Reid - There would be a waste of money if regard were not paid to the Commission's report.

Mr WATSON - Quite so ; but we wish to guard against the possibility of being prevented from introducing the Bill because of the absence of a final report. The Commission might have furnished us with a number of progress reports, although its final report- might not be available at the opening of the session ; but, generally speaking, we should not attempt to move without having an adequate report.

Mr Chapman - Do the Government propose to do anything this session with regard to a Commonwealth system of old-age pensions ?

Mr WATSON - That matter will be dealt with next session. The Navigation Bill will be the first measure introduced, and the Old-Age Pensions Bill will be the next. We admit that there are huge difficulties in the way of the establishment of a Commonwealth system of old-age pensions, 'but difficulties are created only to be surmounted, and we think that in this case they can be- overcome. We are willing, at all events, to pledge ourselves to introduce that measure during next session.

Mr McCay - Are the Government prepared to indicate how they propose to provide the necessary' funds?

Mr WATSON - That is rather much to expect at the present stage. We have had only three weeks in which to prepare our programme.

An Honorable Member. - Why do the Government put these proposals forward if they are not prepared to go into details?

Mr WATSON - Simply because we think it due to the House to apprise it of our proposals. I repeat that we believe we see our way clear to deal with the oldage pensions question. We also propose during next session to take steps in regard to the tobacco monopoly. It is known to us that the importation, manufacture, and distribution of tobacco throughout Australia to-day is, practically speaking, in the control of one combine. I am informed, and believe the information to be correct, that beyond that combine there are only two small concerns - one in New South Wales, and the other in Victoria - manufacturing tobacco. All the distributing agencies, so far as imported tobacco is concerned, are in the hands of one combine. They purchase from the producers, and have the power to fix the rates at which tobacco may be obtained by retailers, and thus to fix the price at which it may be obtained by the consumer. It is true that ve might vary the excise duty with a view to making an alteration in the profits of this combine; but they have such complete control over the business that they would be able to pass on the increased burden, and so maintain their profits at the present rate. I am reminded by one of my colleagues that we do not propose to retail tobacco.

Mr Reid - Then the middlemen will, after all, come in.

Mr WATSON - It is unnecessary to remind the right honorable gentleman that here, as in some other parts of the world, there must be a certain degree of competition amongst the retailers of tobacco. They cannot afford to combine.

Mr Reid - Shall we have a certain quantity of samples submitted to us ?

Mr WATSON - I should imagine so. We should be fairly safe in trusting the right honorable member to examine them, for we know that he does not smoke. I was about to say that the tobacco industry is to-day an undoubted monopoly. I do not believe in the efficacy of anti-trust legislation, and, in my opinion, nothing short of the absolute resumption of this particular monopoly by the State will cure the evil. It is true that in the United States of America attempts have been made at various times to pass anti-trust legislation, calculated to be of some value, and that in one or two instances such legislation has temporarily "scotched" the desire of individuals to form big monopolies or combines. But for how long has such legislation had this effect ? It is invariably, found that the proverbial coach and four can be driven through it. The trouble is in relation to the cure, and the State can restrain those who are operating monopolies to the detriment of the general public, only by taking control of the industries.

Mr Kelly - And so making a bigger monopoly in each case.

Mr WATSON - That is so; but in such a monopoly the people would be partners, instead of having their blood, so to speak, drawn out of them.

Mr Kelly - The tobacco monopoly of France is not in the interests of the people.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - It is to their interest not to smoke the tobacco. The quality depends on the financial exigencies of the' State.

Mr WATSON - If, as the honorable member suggests, the people of France are content, because of a sense of patriotism, to smoke inferior tobacco, that is no reason why a British community should be so foolish as to place men in charge of the State manufacture of tobacco who would not give them the very best they could obtain for the money.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - They increase the revenue by reducing the quality.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - There is no such thing as "best."

Mr WATSON - I should like to say that there is no reason why, in regard to the details of the working of any scheme of this description, we should follow the example of France. In the first place, we should not be justified in my view in spending even £1 of the State's money in this direction whilst we allowed political influence - whether exercised by a private member or a Ministry - to have any effect upon the administration or working of such a Department. That is one condition in regard to the taking over of great public concerns by the State, from which. I, at all events, shall never deviate. Non-political management and freedom from any influence on the part of Parliamentarians must be insisted upon before any such work is taken over.

Mr Deakin - Do the Government propose a Commonwealth tobacco monopoly?

Mr WATSON - Yes.

Mr Deakin - And where do they find the power?

Mr WATSON - I have looked into that matter.

Mr Fisher - Provision is made.

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