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Wednesday, 24 February 1971


Senator Sir KENNETH ANDERSON (New South Wales) (Minister for Supply) (4.19)- I move:

That the Bill be now read a second time.

The purpose of this Bill is to validate certain payments made to members of the three Services during the period 1st April 1961 to 4th February 1966. and to civilians employed under the Naval Defence Act during the period 1st April 1961 to 18th June 1969. This validation action is necessary because it has been established that there were certain formal defects in the financial instruction under which the payments were made. The period in respect of which this action is required commences on 1st April 1961 because all payments made prior to thai date were validated by the Defence Pay Act 1961.

The financial regulations of all the Services empower the Minister of the Service Board to make determinations authorising the payment of certain allowances, etc.. to members of the forces. However, until the regulations of each Service were amended on 23rd September 1963. there was no power to authorise retrospective payments under such determinations.- it is therefore necessary to validate those payments authorised between 1st April 1961 and 23rd September 1963. which involved any kind of retrospective payments. Honourable senators will appreciate. I am sure, that it would be impossible without causing injustice to individual members to ensure that no retrospective payments were authorised under such determinations and, as I have already stated, the regulations have now been amended authorising the making of determinations involving retrospective payment limited to a period of 2 years.

Payments made to members of all Services in respect of which retrospectivity would be authorised ' include: Overseas outfit allowances; overseas allowances for short term duty; overseas transit allowances; overseas living out allowances; child allowances; school expenses; overseas rental allowances, and representation and entertainment allowances. Certain determinations made under Service {Financial regulations were defective for other reasons and the situation in this regard varies with each Service.

In the case of the . Department of the Army, the Financial (Military) Regulations were replaced on 15th March 1961 by a new set of regulations, the Military Financial Regulations. Unfortunately the new regulations did not contain a provision to enable payments to be continued to be made under the authority of determinations made under the repealed regulations. After the contention of the AuditorGeneral that, with the repeal of the old regulations, all determinations should be remade even if no changes were made had been upheld by the Attorney-General's Department, the Department of the Army completed the formidable task of revising and remaking determinations on 4th February 1966. The period during which there are payments which need validation as far as the Department of the Army is concerned is 1st April 1961 to 4th February 1966. Major items in respect of which payments were continued under determinations made under the old regulations include: Scale of clothing and necessaries, replacement of initial issues: scales of issue - rations, and scales of issues - fuel, light, stores.

With regard to the Department of the Navy it was found that certain determinations made by the Naval Board under the Naval Financial Regulations did not meet the formal requirements stated by the Attorney-General's Department to be necessary because they had not been made formally by the Naval Board in session. The last of the formal determinations was made by the Naval ' Board on 12th September 1963. In the case of the Department of Air, all determinations tinder the Air Force Regulations were remade by the Air Board on 23rd September 1963 to remove any doubts regarding the validity of the determinations in force before that date. However, as I have stated earlier, there is a need to cover payments involving retrospectivity in respect of both the Department of the Navy and the Department of Air. The period during which there are payments which need to be validated is 1st April 1961 to 23rd September 1963 for both the Navy and the Air Force.

The payments made to members of the Navy or to members of the Air Force under defective determinations include payments in respect of: Good conduct badge pay; hard-lying money; rent for service residences: issue of uniform kit; mileage allowances; short term duty travelling allowance, and removal of furniture and effects. The Naval Defence Act authorised the employment of civilians and provided that the terms and conditions of employment shall be prescribed in the regulations. The Act was amended in 1968 to enable the Naval Board to determine the terms and conditions of employment of these employees, and the necessary determinations authorising payments to these employees were completed on 19th June 1969. As certain payments had been made which were not prescribed in the regulations, the opportunity has therefore been taken in this Bill to validate the payments made to the civilian employees during the period 1st April 1961 to 18th June 1969. All payments made since that date have been made in pursuance of determinations made by the Naval Board. The payments made to civil employees under the Naval Defence Act included payments for: Fares and allowances incurred in overseas visits; travelling allowances on temporary transfer; allowances paid to staff on trials of ship afloat; meal allowances, and special rates for disabilities, etc.

The total amounts involved have been estimated to be: Department of the Navy, $18,913,600; Department of the Army, 827,270,100; Department of Air, $4,800,000. The payments involved were made in good faith and were in accordance with approvals given by the Treasurer or other competent authority. I commend the Bill to honourable senators.

Debate (on motion by Senator O'Byrne) adjourned.







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