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Monday, 11 June 1928

Mr LATHAM (Kooyong) (AttorneyGeneral) , - I agree with the Deputy Leader of the Opposition that the books of the Australian Workers Union are well kept. Its accounts are clear and detailed, and its returns are lodged as the rules require. In. that respect it is a model organization; but, unfortunately many others do not follow its excellent example. If all of them were as correct in their methods as the Australian Workers Union, it is unlikely that these clauses would have been proposed. Under a section of the act, regulations have been made giving the Registrar power to call for almost any return from a union.

Mr BLAKELEY (DARLING, NEW SOUTH WALES) - Only in relation to certain specified matters.

Mr LATHAM - A union may be required to furnish returns of its members, and accounts, and alterations of its rales. That is a fairly comprehensive list. Under that section regulations are in force which are substantially the same as the provisions of these clauses. Unfortunately, many organizations are not aware of these rules, and, according to the last report of the Industrial Registrar, on the 31st August last 43 unions and six employers' organizations were in default. Circulars have been sent to these bodies reminding them of their obligations. It would have been possible to proceed against the defaulters for a penalty of £2 for each week of default. But it appeared to me that, as the obligation was not generally understood, it would be better to bring it prominently before the organizations by expressly stating it in the statute itself, instead of in more or less obscure rules and regulations. That is substantially the reason for this amendment. I hope the 43 defaulting unions will now inform themselvesof the contents of the bill.

Mr Seabrook - Can the court enforce these provisions?

Mr LATHAM - Unless they can be enforced, it is useless to pass them. The Deputy Leader of the Opposition has asked why the words " such other records as are prescribed " have been put into the proposed section. The purpose of that is to enable the Registrar to call for any return not specified which he may think it desirable to have.

Mr Blakeley - Has the AttorneyGeneral in mind the minute books of the unions ?

Mr LATHAM - No; but it may be desirable at some time to require an organization or branch to keep certain records which cannot be specified in advance. The proposed new section is more specific than the existing rules, in so far as it requires, among other things, ' the keeping of a list of the union's officers " and of every person holding, whether as trustee or otherwise, property of the organization or of any branch of the organization, or property in which the organization or branch has any beneficial interest." The penalty also has been altered. The present law imposes upon the organization a penalty of £2 for each week in default. The bill provides in the case of an organization or branch for a maximum penalty of £100, and in the case of a secretary or other prescribed officer, a penalty of £2 for each week in default. The obligation placed upon the organization is to keep and file such records as are required. The obligation placed on the secretary or other certified officer is to certify such records by statutory declaration. I have little doubt that if the penalties which have already accumulated against the defaulting organizations were enforced they would amount to much more than £100 each.

Wo read far too frequently of defalcations in connexion with the funds of both friendly societies and trade unions. Unfortunately, it is not within the power of this Parliament to legislate in respect of friendly societies, but it is time that the State laws were strengthened in order to prevent these losses.

Mr Charlton - The law in New South Wales is fairly tight.

Mr LATHAM - Large defalcations have occurred in Victoria, and special attention has been called to them by the registrar of friendly societies, who is of opinion that dishonesty is assisted by the employment of unskilled auditors. Persons who are quite honest, but who do not understand accounts, are appointed auditors by lodges anc5 branches of friendly societies, and their auditing is so inefficient that it is easy for a clever officer to get away with the money of his organization. Only recent.1/ we had unfortunate examples of defalcations in connexion with trade unions. The bill provides that every organization and branch shall appoint annually a qualified person as its auditor, and any doubt as to whether the appointee is qualified will be settled by the registrar.

Mr Scullin - In what way does this affect the settlement or prevention of industrial disputes?

Mr LATHAM - The honorable member is referring to the degree of control that can. be exercised over organizations. This Parliament is entitled to define the conditions upon which organizations shall be allowed to obtain registration under the act. It may well say that it will not accord to any organization of employees the right to obtain an award of the court unless it is conducted financially and otherwise in accordance with the standards prescribed. That is the foundation of all legislation respecting organizations.

Mr Scullin - The Attorney-General referred to organizations of employees. Does not this law apply to all organizations?

Mr LATHAM - Certainly; it applies to all organizations of employers and employees. But the employers' organizations are able to protect their funds more easily than organizations of employees. The protection of funds is always more difficult for organizations which receive their funds in small amounts, weekly or monthly, than for organizations which receive annual contributions. A special audit would not be ordered so long as the accounts of the organization were properly kept; but it is desirable to provide that when the Registrar is of the opinion that for any reason whatsoever an audit should be conducted he should have power to order it. I assure honorable members that the Government has introduced this provision solely to protect the financial interests of members of organizations. If it is considered that one auditor would be sufficient I am willing to amend the clause to that effect.

Mr Blakeley - Who is to pay for the audit ?

Mr LATHAM - If a special audit is ordered by the Registrar I am quite prepared to provide that the Government shall pay for it.

Mr Scullin - I am glad to hear the Attorney-General agree in this connexion with an argument that I used in relation to secret ballots, namely, that when the Government imposed an expense upon an organization it should pay it.

Mr LATHAM - I move-

That the words " two qualified persons as special auditors ", sub-section 4, be omitted with a view to insert in lieu thereof the words " a qualified person as a special auditor."

Amendment agreed to.

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