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Thursday, 20 October 1949

Mr DEDMAN (Corio) (Minister for Defence and Minister for Post-war Reconstruction) '. - by leave - I move -

That the bill be now read a second, time.

The purpose of this bill is to arrange for the financing of long service leave benefits which have been granted by an award of the Coal Industry Tribunal issued on the 14th October, to certain employees in the coal-mining industry. Other measures which will be brought forward shortly are complementary to this bill and, taken with this measure, form a single scheme. Honorable members will doubtless be aware that after having lodged a claim with the Coal Industry Tribunal for long service leave, which up to that time had not been determined, on the 19th May of this year the miners federation also included long service leave in a log of claims served on the colliery proprietors, the Joint Coal Board and the Australian and State governments. This log of claims was considered at a series of conferences of the parties concerned. At these conferences it was emphasized that if an award of long service leave were made, the cost could not be borne by the individual owners but would have to be financed on an industry basis. The representative of the Australian Government, Senator Ashley, said that, if long service leave were granted either by agreement between the unions and the proprietors or by an award of the tribunal, the Australian Government would arrange for finance for such a scheme. At the same conference, the then New South Wales Minister for Mines, Mr. Baddeley, representing the New South Wales Government, stated that his Government would " play its part ". Honorable members will know that those conferences broke down. The tribunal then proceeded to conclude the hearing of the long service leave case, and announced that it would issue a draft award for discussion between the parties on the 14th June. Because of the general strike in the industry and the events which preceded it, the draft award was not issued. After the strike ended, the matter was reconsidered by the tribunal, which has now made an award in respect of members of the miners' federation employed in the coalmining industry. This award is identical with that made in draft form prior to the strike. The Government is now proceeding to provide the machinery for the running of the scheme.

It will doubtless be evident to honorable members that it would be impracticable for the cost of the leave to be made the full financial responsibility of the individual employers. I shall mention some of the reasons. During their working lives, many employees have changed from one employer to another, and it would be inequitable to place the cost of all such employment solely upon presentday employers. Some collieries are not financially capable of meeting the additional cost involved by the leave. Many employees have been employed in the past by colliery companies that are no longer in existence. Moreover, employers would be reluctant to employ men with previous employment in the industry because of the additional liability for long service leave that their employment would involve. This would tend to make labour less mobile than is desirable within the industry, and could result in a loss of skilled labour to the industry. It is also not unreasonable to provide some protection to employees against employers going out of business or becoming insolvent. Under these circumstances, the award can only be financed on an industry-wide basis. To make this possible the establishment of a central fund is necessary in order to spread the liability evenly amongst employers, and particularly to finance the heavy burden p{ introspective liability.

Broadly, the scheme now placed before the House in this interdependent set of three measures is that an excise of 6d. a ton will be placed upon coal produced by those employees in the coal-mining industry who will receive the benefit of long service leave. The proceeds of this excise will be placed in the Commonwealth trust fund and from this fund the Treasurer of the Commonwealth will be empowered to make grants to the States. It will be necessary for each State to which the award applies, that is, all States of the Commonwealth excluding South Australia, to pass complementary State legislation to authorize the State to reimburse employers for their long service leave liability under the award and for the State to recoup this expenditure from the Commonwealth. The State legislation will need also to establish appropriate administrative arrangements and make the necessary machinery provisions. After the passage of the present legislation, the Treasurer (Mr. Chifley) will negotiate with each State and upon the passage of the necessary State legislation a formal agreement will be entered into between the Commonwealth and the State to provide in detail for payments from the Commonwealth trust fund to the State. It is provided in clause 4 of the bill that these agreements must be approved by the parliaments of the Commonwealth and the State before any payments are made from the central fund. It is intended that the agreements shall specify in each ease the award to which the scheme applies. Commonwealth funds will not be provided for any increased expenditure arising out of amendments to the award or any additional awards relating to the coal industry until the agreements have been amended and the amendments ratified by the parliaments.

The long service leave that has been awarded by the Coal Industry Tribunal is broadly on the basis of three months' leave for every ten years' service in the industry. Under the award, long service leave is to accumulate in the future at the rate of one-eighth of a shift for each five consecutive shifts worked. Long service leave will become due when 65 shifts of entitlement, or thirteen weeks' leave, have accrued. For an employee who works continuously, this approximates to three months' leave for ten years' service, but if the employee does not do this continuous service he will take correspondingly longer than ten years to become entitled to his thirteen; weeks' leave. For past periods of employment in the industry leave has been awarded on the basis of five days' leave for each year pf employment up to a maximum of thirteen years, that is, a maximum of three months' leave in respect of all past employment. No leave may be taken before the 1st January,. 1954, but provision has been made in the award for payment in lieu of leave in cases of retirement due to age or ill health or in cases of death. A further provision of the award is that in the future theaward will be suspended in the event of ai strike in any district until the tribunal! otherwise orders. Because of the general strike, the tribunal has imposed a penalty which means that employees must work approximately a further twelve months in order to gain the same entitlement as they would have had if the strike had not. taken place.

The a ward issued in respect of members of the miners' federation will cover all coal mines throughout Australia, with the exception of the State coal mine at "Wonthaggi, the men there being already entitled to long service leave under Victorian State legislation,- and Leigh Creek field in South Australia and the open-cut brown coal mines in Victoria, neither of which are subject to the jurisdiction of the special industrial authorities that have been established for the coal-mining industry.

Under the measure to be introduced to impose an excise on coal, it is proposednot to tax coal produced by a State. However, the Government proposes that, where applicable, the States shall he asked to pay into the trust fund an amount equivalent to the excise and thus become entitled under the agreement to reimbursement of the cost of long service leave payable to employees at State mines-.

The cost of the scheme has been estimated on the basis that there will be a peak period for leave in 1954 and the? two or three years following and in the few years following 1960. As I have already mentioned, except for payments in lieu of leave to employees in certain cases, leave will not be taken before 1954. Over the next eleven years, which in the two peak periods of leave entitlement, the cost of leave at current wage rates will call for an annual payment of approximately £360,000 into the fund. This suggests a levy of 6d. per ton on all coal produced except at Wonthaggi and open-cut brown coal mines in Victoria and at Leigh Creek in South Australia. I commend the bill to honorable members.

Debate (on motion by Mr. Holt) adjourned.

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