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Tuesday, 9 December 1930


Senator O'HALLORAN (South Australia) . - For once honorable senators opposite are filling a role totally different from that which they have filled since the present Government has adorned the treasury bench. Instead of complaining that the Government does not propose to go far enough, or that it is indulging in drastic legislation or administration, they are condemning it because it has not gone far enough. There is a striking lack of unanimity of opinion amongst honorable senators opposite concerning the principle embodied in the bill. For instance, Senator E. B. Johnston contends that it provides for a definite reduction in the allowances of Ministers and members of Parliament, and the salaries of certain members of the Federal Public Service, while Senator Reid says that it is pure camouflage and in reality is not a reduction at all. It must either he a tax on, or a reduction in, salaries. But whichever it may be, it will reduce the cost of -the Commonwealth Public Service for the ensuing financial year. Honorable senators opposite contend that the only way in which to balance the budget is by reducing the wages of the workers irrespective of their status in the community. They would indignantly repudiate the suggestion that they were members of a low-wage party; but the tone of their speeches suggests that they are. Every argument they have adduced has been to the effect that the budget ought to be balanced by a reduction in wages of workers. I can visualize that in some instances it may be necessary to reduce wages in order to balance the budget; but in this instance it would mean that Parliament was to arbitrarily reduce the wages of lower-paid public servants, which have been fixed by various arbitration tribunals.


Senator Sir George Pearce - Is the principle affected by high or low wages?


Senator O'HALLORAN - It makes a very great difference, because the great bulk of the salaries of the lower-paid public servants, which have been fixed by an arbitration tribunal, should not be altered by this Parliament. The Leader of the Opposition (Senator Pearce), who referred to the action taken by the Labour Government in South Australia, suggested that a similar policy should be adopted by this Government. The only salaries that have been reduced by the Labour Government in South Australia are those received by persons in precisely the same class as are to be affected by this legislation. They include members of Parliament, railway commissioners, the Commissioner of Police, the Agent-General, and other highly paid public officers. Speaking from memory, I believe that apart from members of Parliament, and officers of Parliament, no public officer in that State earning less than £1,000 has been compelled to submit to a reduction.


Senator Sir George PEARCE - What about the school teachers?


Senator O'HALLORAN - They were not reduced by legislation, or any administrative act of the State Government; but by the tribunal which fixed their salaries. A suggestion came from the employees that something in the nature of a mutual agreement should be entered into, and that was done. The great bulk of Commonwealth public servants, of whom there are over 34,000, are earning less. than £300 a year, and of this number 80 per cent, are employed in the Postal Department, which is a profitable undertaking, and are scattered throughout the Commonwealth performing a multiplicity of tasks under varying conditions. Tho only way in which their salaries or allowances should be varied is by an appeal to the proper tribunal.


Senator McLachlan - That tribunal does not exist.


Senator O'HALLORAN - A public service arbitrator will be appointed at the proper time. A large number of the lover-paid public servants are governed by awards of the Federal Arbitration Court, which is at present functioning. It has been said that when other salaries were being reduced those of a section of the Commonwealth Public Service, subject to determinations of the Public Service Arbitrator, were being increased. Why were they being increased? Honorable senators who make this charge against public servants know the conditions under which the determinations were made, and that they provide for periodical adjustment based upon the cost of living figures. They also know that these conditions were established by the Government of which they were either members or supporters. When the cost of living was rising, Commonwealth employees, who were' governed by these awards, had to wait until the time for revision same round before they received any advancein their salaries. There was then a considerable lag between the increase in the cost of living and the adjustment of their salaries. Is it fair that those who stood by the system of arbitration when it was against them should be penalized now that the cost of living is falling? I ask those honorable senators opposite, who mgc that, when times are bad, the public servants should immediately come into line and make a. sacrifice, whether they agree that, when the Commonwealth revenue is abounding, and there is a surplus in the Treasury, a portion of that surplus should be disbursed among the public servants? When conditions were against the public servants, honorable senators opposite stood for the strict observance of the law by which salaries were fixed: now that the tide is turning, and the public servants have a momentary advantage, they urge that awards should arbitrarily be set aside in order that the budget, may be balanced.


Senator Reid - Why not?


Senator O'HALLORAN - During my public life, I have always stood foursquare for arbitration. I do so to-day. For that reason I do not stand for this Parliament becoming a machine to reduce wages in times of depression, unless the same liberty to interfere with awards is permitted when revenue is abounding and the Treasury is overflowing. The bulk of these agreements and awards will come up for review within the next few months when any necessary adjustment can be made.

The members of the Opposition are inconsistent in that while they blame the present Government for having increased the cost of living, they urge that the salaries pf public servants should be reduced because the cost of living has fallen by 20 per cent, during recent months. They also contend that the Government has made the Commonwealth public servants a sheltered community notwithstanding that they know that at the conference in Melbourne, the recommendations of which they so enthusiastically support, it was agreed that the Federal Treasurer should leave to the State Treasurers the field of taxation on incomes less than £500 per annum. Because the Commonwealth Government has honored that agreement it is accused of having created a. sheltered section in the community.


Senator Sir William Glasgow - Public servants living in Canberra pay no State income taxation.


Senator O'HALLORAN - The public servants resident in Canberra form only a small proportion of the Commonwealth public servants throughout Australia. The total population of the Federal Capital Territory is a- little over 7,000 persons, and includes farmers, graziers,, business people, and minors, in addition to public servants. It is true that those few Commonwealth public servants escape the payment of State income taxes; but I venture the opinion that any one of them would willingly change places with a fellow officer Occupying a similar position, bearing the same salary in any of the State capitals, and cheerfully pay the State taxation to escape from Canberra.


Senator Sir George Pearce - Does the honorable senator think that their salaries ought to come down?


Senator O'HALLORAN - Whatever reduction might be made ought" to be made by the tribunals responsible for the fixing of the salaries of publicservants, and should follow the same principle th aft operates when the cost of living is rising. I again remind hon'orable senators that the awards under which public servants operate are subject to review annually. When the time for revision comes round they will be reviewed by the proper authority, and any necessary adjustments made. Honorable senators opposite are quick to recommend aj reduction of public servants' salaries when they are obtaining some little benefit from the fall in rho cost of living; but they were not anxious to suspend awards to enable their salaries to keep pace with the increased cost of living.


Senator Sir George Pearce - -The late Government introduced a bill to deal with the allowances of public servants.


Senator O'HALLORAN - It was a bill to deal with their allowances by eliminating most of them. The public servants of t.ho Commonwealth receive no allowances to which they are not entitled; yet the late Government sought to deprive them of those allowances.

The Leader of the Opposition (Senator Pcarce) charged the present Government with having increased the cost of the iPublic Service since it assumed office, lie supported his contention by qtioting from the report of the Public Service Board for the year ended 30th June last. The right honorable senator must accept his share of the responsibility for any increase in the number of public servants in that year, seeing that he was a member of a government which was in office from July to November, 1929. Indeed, his responsibility must go further than that, for the present Government had, in the main, to carry out t he budget proposals of the previous Government in respect to departmental expense. It is scarcely fair that the right honorable gentleman should blame the present Government for what hiB own government planned. A fairer test would be to take the cost of the Public Service for the current financial year, for which the present Government will be solely responsible. As the bill provides for that sacrifice which the times demand, it has my support.

Senator DUNCAN (NowSouth Wales) |"5.49]. - In common with other honorable senators supporting the Government, Senator 0'H.alloran finds it somewhat difficult to square the actions of the Government with the promises the Labour party made before the last eleo- tion. The honorable senator has made as strong a case in support of the Government's proposals as could be made. I congratulate him on his speech. Like the curate's egg it Avas good in parts. There were some parts that were not quite as good as we should have liked them to be. The Government and its supporters are finding it exceedingly difficult to justify the measure that is now before the Senate. When we remember what, has been said in the immediate past by those supporting the Government with regard to matters that are very similar to the proposal now before the Senate - the reduction of income, wages, &c. - we realize how difficult it is for them to find their feet when discussing thiis matter. We were assured that this Federal Labour Government would strenuously fight any proposal to reduce wages. But the facts of the position seem to have thrust themselves upon the Government, in common with a good many other people in the community, and it now makes what can only be regarded as a gesture, and perhaps in some respects a most unfortunate gesture, of its intention sooner or later to take that step which honorable senators of the Opposition knew to be unavoidable - an adequate reduction of government expenditure. This proposal affects only a few hundred civil servants. As. was pointed out, by the Leader of the Opposition (Senator Pen roe), the great majority of Commonwealth public servants will not be affected, for the present at any rate; but is it to be believed, even by the rank and file of the Civil Service, who, by the terms of the measure, are deliberately excluded from this taxation, that they will escape for any very reasonable length of time? Once the principle has been endorsed that reductions must be made, and reductions of a substantial character, its general applicability, to the Service is inevitable.

This is not a straight-out proposal to reduce salaries. It. would have been more honest if it were. It is a proposal to tax salaries, to bring about the reduction that, ought to be made in governmental expenditure.


Senator Rae - I do not see that the term employed makes a bit of difference. " A rose by any other name would smell as sweet."







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