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Friday, 30 April 1971


Senator SIR KENNETH ANDERSON - No. They are separate.


Senator CANT - I rise to direct the attention of the Senate to the unsatisfactory position that exists within the offshore petroleum industry today. In 1967 the Government brought before the Parliament legislation to pro vide, for the administration of the off-shore petroleum industry. The preamble to that Bill, which is now the Act, reads:

Whereas in accordance with international law

Australia as a coastal state has sovereign rights over the continental shelf beyond the limits of Australian territorial waters for the purpose of exploring it and exploiting its natural resources:

This is a clear statement by the Commonwealth Parliament that it is a coastal state which has constitutional rights over the area of the continental shelf. Senator Webster - That, of course, means the Commonwealth, does it not?


Senator CANT - There is only one coastal state in the international sphere. In the preamble the. Commonwealth weakens its own hand by stating:

And whereas Australia is a party to this Convention on the Continental Shelf signed at Geneva on the twenty-ninth day of April, One thousand nine hundred and fifty-eight, in which those rights are defined:

And whereas the exploration for and the exploitation of the petroleum resources of submerged lands adjacent to the Australian coast would be encouraged by the adoption of legislative measures applying uniformly to the continental shelfand to the sea-bed and subsoil beneath territorial waters:

The first matter to which I draw the attention of the Senate is that as a result of evidence given before the Senate Select Committee on Off-Shore Petroleum Resources which was inquiring into the legislationthe Petroleum (Submerged Lands) Act: - it was revealed that there were serious weaknesses in that legislation, particularly in Part II which has for its purpose the application of the laws operative in the States, whether they be Commonwealth laws, State laws or common law, in areas adjacent to the States. Some of the learned witnesses who appeared before the Committee cast grave doubt on whether Part II did, in fact, do what the Commonwealth set out to accomplish. As a result, at a meeting of Attorneys-General held in Hobart in March 1969 it was agreed between all parties that section 9, which is the section that applies the laws, would be amended. I emphasise the date. In March 1969 this agreement was arrived at. If one goes to the non-justiciable agreement which underpins the petroleum submerged lands legislation, in clause 6 of that agreement it will be found that no amendment can be made to the legislation unless there is unanimous agreement between the 7 governments. In March 1969 the 7 governments agreed to amend the legislation.I am advised by one of my colleagues who is skilled in the law that the amendment as agreed to would eliminate much of the objection and doubt which Professor O'Connell, a highly trained lawyer, had expressed concerning the application of the law. We find that South Australia amended particularly section 9 which is the section about which I am speaking. There are other sections but I am referring particularly to section 9. The South Australian Parliament amended its legislation in November 1969. Western Australia amended its legislation in November 1970. The Commonwealth, Tasmania Victoria, New South Wales, Queensland and the Northern Territory - which would amend by ordinance - have not made any amendment. I shall again read the third paragraph of the preamble to the legislation. It states:

And whereas the exploration for and the exploitation of the petroleum resources of submerged lands adjacent to the Australian coast would be encouraged by the adoption of legislative measures applying uniformly to the continental shelf and to the sea-bed and subsoil beneath territorial water:


Senator Wright - Briefly, what was the effect of the Western Australian and South Australian amendments?


Senator CANT - The effect of the amendment was to make clearer the fact that the laws operating in the States would apply in areas adjacent to the States. These areas are defined in the legislation.


Senator Wright - Did the amendment make the legislation more uniform?


Senator CANT - The fact that 2 States have amended the Act and that 4 States, the Commonwealth and the Northern Territory have not amended it clearly discloses that uniform legislation to control the industry was never at any time necessary. Section 9 which is a rather short section has 5 sub-sections in it. Its purposes is to pick up the whole body of law operating in a State and project it out to sea to operate in the adjacent area. This is an important procedure. It is done in quite a simple way. A committee was appointed to do this drafting work although the bulk of it fell upon the chief Parliamentary Counsel in Canberra, Mr Ewens. At that stage he was the Parliamentary Draftsman. What he had drafted had to be approved by the various State authorities. Professor O'Connell raised a doubt as to whether the Commonwealth could go as far as it purported to go. under the external affairs power. He raised a doubt that a State could legislate extra-territorially unless it could establish a nexus with the State itself. As a result, that section was amended by two States. Section 9 of the Act, of course, placed some clear restrictions upon the Commonwealth Government. .We have a Constitution which was made, in the horse and buggy days which the people have refused repeatedly to allow the Commonwealth to amend in order to catch up with the conditions which exist today. Subsection (3.) of section 9 reads: (3.) This section does not -

(c)   apply to the provisions of any law or instrument that is not within, the authority of the Parliament or Government of the Commonwealth;

The Commonwealth can transport laws into adjacent areas only if they are laws which are capable of being passed by this Parliament: Honourable senators will know the restrictions that are in the Constitution of the Commonwealth. Sub-section (2.) reads: .The provisions referred to in. the last preceding sub-section apply to and in relation to all acts, matters, circumstances, and things touching, concerning, arising out of or connected with the exploration of the sea-bed or subsoil of the adjacent area for petroleum and the exploitation of the natural ' resources, being petroleum, of that sea-bed or subsoil, and. not otherwise . . .

This sub-section threw grave doubts upon whether, in the event of criminal acts being committed out to sea on oil drilling rigs, pipe laying barges or those sorts of things, the Commonwealth Crimes Act or the States criminal code applied. In the opinion of Professor O'Connell the Crimes Act did not apply.


Senator Wright - Did not apply?


Senator CANT - Did not apply. There is a firm of solicitors in Victoria, which is the most active State in oil exploration and exploitation, who are advisers are to Ingram Contractors (Australia) Pty Ltd, the largest contractors out to sea in adjacent areas of Victoria. That firm has had to advise Ingram Contractors that if criminal acts are committed in working places- in adjacent areas the criminal law does not apply.

The amendment seeks to overcome that position. Senator Greenwood was kind enough to give me advice. He was of the opinion that the amendment does cover most of the things raised by Professor O'Connell. Therefore it is important for the legislation to be amended in accordance with the unanimous agreement entered into between the parties in March 1969.

I would think that we cannot get thi* legislation amended by. this Parliament before the Budget session, although it was about this time last year that I asked the Minister for National Development (Mr Swartz) when the amendment would bs passed through this Parliament. The answer was that he did not think it would be possible to do it during the autumn session of last year but it would be done , in the Budget session of that year. It has not been done. It is not proposed to bc done during this autumn session. It is now 2 years since the parties unanimously agreed to the amendment.

I read . in the newspapers this morning that the Victorian Parliament has gone into recess for the winter. So it is obvious that this legislation cannot pass through the Victorian Parliament before it resumes for its Budget session later this year. I do not know the position with respect to the Parliaments of New South Wales and Queensland nor do I know the position with respect to the Legislative Council for the Northern Territory. But I regard this matter as of such importance that some urgent action should be taken to have legislation promulgated. It has been drafted; it has passed through 2 State Houses of Parliament. lt must pass through the other 5 Houses of Parliament and the Northern Territory Legislative Council in the same form. For this to be done would only require the legislation to be printed, and I say that it should be done.

Section 101 of the Petroleum (Submerged Lands) Act allows the Designated Authority - that is the officer in charge of the legislation in each of the States, generally the Minister for Mines in that State - to give directions to a permittee or a licensee, that is, an individual or corporation that has been issued with a permit to explore for oil or an individual or corporation that has been given a licence to exploit petroleum, to use the words of the

Act, which has been found. Those directions may be given on any matter upon which regulations may be made. The directions may be contrary to the regulations, if regulations have been made. To date regulations have not been made. The directions can' override the regulations. In other words, the directions given by the Designated Authority can wipe out anything that this Parliament has done. But the important part of it is that the directions may be given only to the permittee and the ' licensee. As honourable senators will know, most if not all of the work that is carried out is being carried out by contractors. At least that is the position in Bass Strait. The Designated Authority in the States is unable to give directions to a contractor to carry out work, as provided in section 97 of the Act, for the health, weir fare and safety of the work force. The Designated Authority is not capable of directing a contractor to do that. If he gives a direction the contractor can ignore it. It is not binding upon him.

The amendment agreed to in March 1969 sought to recover this position and allow the Designated Authority to. direct anyone in the field - contractor, permittee, licensee or the holders of any other documents. It is important that this should bc done. I am not saying that contractors in . Bass Strait and off the north west coast are doing as they like, but they could be able to do as they like. The meeting of AttorneysGeneral in Hobart which was called as a result of evidence given to the Senate Select Committee on Off-shore Petroleum Resources saw the seriousness of this position and agreed unanimously that the legislation should be amended. Yet more than 2 years after that agreement was arrived at we find that the legislation has not been amended.

I wish now to direct my attention to Appropriation Bill (No. 3). I hope to be able to ask some questions in relation to the appropriations during the Committee stage of the Bill, but there is a particular matter I want to bring to the attention of the Senate. When the then Treasurer presented the Budget on 18th August last year he said:

Since total expenditure is estimated at $7, 883m the Budget shows a surplus of $4m.

However, when speaking about the Post Office - I take the Post Office as only one example of what is going on - the then Treasurer said in the same speech:

To avoid a Post Office loss this year, and to enable the Post Office to make its contribution to financing the desired capital programme, it is proposed to raise charges to increase receipts by about $42m in 1970-71 and about $53m in a full year. The proposed increases cover postal charges, telephone rentals, the telephone connection fee and charges for certain other services. The PostmasterGeneral will presently give further details.

When we look at the current estimates we find that some very large supplementary appropriations are sought by some departments - not all departments - in Appropriation Bill (No. 3). We are told that the reason for the increases in postal, telegraph and tele-' phone charges is that costs have increased since 1st October 1970, which is when thelegislation was passed in this place. But we find that the extra $42m that is sought- to be gathered into the Treasury by the increase in postal, telegraph and telephone charges is not a consideration in respect of receipts and expenditure for the year when the Budget! is presented. Therefore it is not correct for the Treasurer to say that he provides for a surplus of $4m because the departments between them will have to expend their proportion - not the whole - of the increased charges amounting to $42m. Let us take it that the Commonwealth is a 30 per cent contributor to the charges made by the PostmasterGeneral's Department. We find that the Commonwealth Government's additional expenditure will be $21m, yet the Treasurer comes into the Parliament and makes a statement that there will be a $4m surplus. - This is government by deceit. It is government that takes no account of increased expenditure by the Commonwealth for various departments because the Government says that this cannot be estimated.

The Government says that when a department makes up its estimates of expenditure for the year - they have to be made about May or early June for consideration by the Cabinet - that department has no knowledge of what another department may be doing with respect to increased charges. It is unable to make an estimate in advance for increased charges made by another department. I suggest that in the computer age adjustments in expenditure can be made within hours and, in many cases, within minutes. I suggest that when it is found that the estimates of expenditure by the various departments reach a particular figure and the estimates of extra revenue that is to come to the Commonwealth due to various departments raising charges on the Commonwealth and the people are known, the adjustments to the estimates of the various departments can be made very quickly. In this way as near as possible to a correct picture can be placed before the people at Budget time. I do not criticise the Treasurer in person in any way. He is the functionary, for good or ill, who has to carry out this job on behalf of the nation. No criticism is intended of the character of whoever holds the office. But he comes into the Parliament and tells . the people of Australia, through an official document, that, the Commonwealth will have a surplus of $4m for the year without any regard to the extra SI 20m of additional appropriations that are required in these supplementary' estimates.

We know that there will be additional receipts by the Treasury. The increase granted in the national wage case is estimated to have put several hundred million dollars into the' coffers of the Treasury; so if is quite likely that there will be a bigger surplus than the $4m' which the Treasurertold the people there would be. That increase 'was outside the control of the Department. The things that were within the control of the Parliament, that is, the additional charges that will have to be met and that are not taken into consideration when the estimates are brought up, have been completely ignored.

There is one other matter I want to refer to. I ask you, Mr Deputy President, to advise .me whether I am in order in raising it. I want to refer to the charges that are being inquired into at HMAS Leeuwin', the Fremantle naval depot. I think every honourable senator here would have knowledge of accusations, of allegations, that are being made with respect-


Senator Wright - I suggest that, withinthe spirit of our rule, the honourable senator should not refer to matters that are being inquired into by a judge. I suggest that he should not canvass those allegations.


Senator CANT - 1 take the point. I do not want to offend.


Senator Wright - Judge Rapke has to deal with it and he would be prejudiced by any remarks made here. We usually extend that privilege to the judiciary. .


Senator CANT - Very well, 1 will leave it at that. 1 forcefully request Senator Cotton, who represents the Minister for National Development, to ask his colleague even at this late stage, to attempt to get before this Parliament before we rise the amendment to the Petroleum (Submerged Lands) Act 1967-68 and to impress upon those States which have not amended their legislation the urgency and seriousness of the legislation being amended as agreed. I suggest to the Leader of the' Government in the Senate (Senator Sir Kenneth Anderson) - he is not in the chamber at the moment but I hope someone will draw his attention to my remarks-that 1 there should be a wider use of computers in the. presentation of the Budget during, the next sessional period in order that a more correct picture of the financial. -workings of the Parliament may be presented^ at- that time.







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