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Thursday, 12 October 1911

Senator DE LARGIE (Western Australia) . - I move -

That the report of the Royal Commission on Postal Services laid on the table on the 5th October, I 0 I O, be approved by the Senate.

This motion refers to a matter that has been very often mentioned, not only in this Chamber, but elsewhere. On many occasions before the report of the Commission on Postal Services was tabled, it was urgently asked for, but although it has now been upon the table of the Senate for twelve months, honorable senators opposite do not appear to be in any hurry to discuss it. I leave them to explain why that is so. As a member of the Royal Commission I feel it to be my duty to move that this report be approved by the Senate. lt is so voluminous that it will be admitted that it would be impossible to exhaust it in one discussion. I do not propose to go through the whole of the report to-night, but merely to touch upon the points which I think are of most interest to-day. Many of the recommendations of the Commission have been adopted by the present Government. As the necessity for some of the reforms proposed appeared during the investigations of the Commission, they were adopted even before the report was drafted. As a matter of fact, many of the recommendations of the Commission had already been acted upon.

Senator W RUSSELL (SOUTH AUSTRALIA) - That has not been acknowledged.

Senator DE LARGIE - It is quite true that there has not been much acknowledgment of the work of the Commission. Their work and their report have undoubtedly had a beneficial effect on the Post and Telegraph Department. Quite a number of reforms have been instituted in the conduct of that Department since the investigation by the Commission began. As I played but a minor part in the preparation of the Commission's report, I should like, in fairness to the late chairman of the Commission, who is no longer a member of the Federal Parliament, to say a word in praise of his services on the Commission, and of the report as it appears before us. The gentleman to whom i refer is unable now to speak on his own behalf in this Parliament, and though he was a member of the party opposed to that to which i belong, i think it is only right that I should say that the report is a great tribute to the ability of Mr. Wilks, because it is his work more than that of any other member of the Postal Commission. He and the secretary, Mr. Synan, put in a great deal of work.

Senator Rae - What about Mr. Webster?

Senator DE LARGIE - Mr. Websteralso deserves credit for the work he did on the Commission. But he is still a member of another place, is still the " unabridged " Webster, and is therefore able to speak for himself, as he no doubt will, in due course. I am speaking now for those who are unable to speak for themselves in this Parliament, and I say that Mr. Wilks, as chairman of the Postal Commission, and Mr. Synan, as secretary of that Commission, deserve every credit for the very comprehensive report which has been laid before us. I should say that the career of the Commission was rather rocky. There were several occasions on which it appeared that its work would be brought to a .close, and several attempts were made to upset it. As a member of the Commission, I was determined that, so far as I was concerned, I would see the work through, but, for party purposes, I am disposed to think, several attempts were made to prevent the Commission going on with its inquiry into the many grievances of which we heard so much before it was appointed. There is no use blinking the fact that for a considerable time before the appointment of the Commission grievances of all sorts, suffered by various officers of the Department, were discussed in the Senate and in another place, and public complaints were made as to the unsatisfactory nature of the services rendered by the mail, telegraph, and telephone branches of the Department.

Senator Sayers - They still exist.

Senator DE LARGIE - Many of them do, no doubt ; but I shall be able to give a list of many that have been removed.

Senator Chataway - The honorable senator's list is going to contain the complaints that have been removed?

Senator DE LARGIE - I propose to refer to the grievances that have been removed. It is quite impossible in such a department as the Post and Telegraph Department of the Commonwealth to have in practice the very latest developments in connexion with every branch of its work. As time goes on new and better methods of work are being continually discovered, and the time may never come when we shall have a Post and Telegraph Department completely uptodate in every possible respect. But this much I will say, that, even at its worst, the Post and Telegraph Department of the Commonwealth was a long way ahead ot many similar departments in other civilized countries of the world. During the investigations of the Commission we found, on making comparisons, that, speaking of the work of the Department all round, in very few of the services performed by it could any one country in the world claim to have a better system. I think it is only fair to say that, because there is a feeling prevalent that our Post and Telegraph Department is behind the times. That is not so. In the handling of mail matter and in the services rendered by the telegraph and telephone branches it will be found that the Commonwealth Department is as much up-to-date as are those of most of the countries of the world. Whilst I make that claim I do not by any means admit that the Department was all that it should be, or that it is yet all that we can make it. There are still many defects to be remedied, and much work to be done. Regarding the troubles of the Department, I may say that long before the Federal Government took it over, matters were in a bad way in many respects. The Commission had evidence to the effect that the telephone branch in particular was in an obsolete condition in most of the States. When the Commonwealth assumed responsibility for that branch of the service, there was occasion to spend a very large amount of money on its improvement. For some reason or other the various States had declined to spend money on telephones for some time previous to the inauguration of the Commonwealth. When the Commonwealth Government found that that state of affairs existed, an attempt should have been made to remedy it as soon as possible. But years were allowed to elapse before any proper inquiry was made. During that time, as has been said more than once, we were starving the Department. It was only natural to expect, therefore, that things would not improve. The reason was not far to find. Money was urgently required. It was the lack of funds for establishing new exchanges with metallic circuits and up-to-date switchboards, and carrying out various other improvements, that caused the Department to get into a very backward condition.

Senator Rae - Ah ! lack of funds again!

Senator DE LARGIE - It was lack of money that was the cause of all the mischief.

Senator Rae - That is the consideration that "makes calamity of so long life."

Senator DE LARGIE - During the first six years of our Federal existence, the Commonwealth Treasurer seemed to be more anxious to find money to pay over to the States a larger sum per annum than they were entitled to receive under the Constitution, than to improve our own services. Consequently, the Departments were starved. Without thoroughly realizing how matters were allowed to drift through lack of funds, we can scarcely understand why it was that this Department got into such a backward condition. With the , £6,000,000 sterling that was handed over to the States, the Commonwealth could and should have promoted many new works that were required. Instead of doing that, however, we handed the money over without even laying down any condition in respect to payment for the transferred obsolete telephones. We did not even ask the States to recognise that this . £6,000,000 should be accepted in discharge of our obligations in respect of properties they had transferred to us. Nevertheless, during the last ten years, the cry has been constantly raised, " When is the Federal Government going to pay for the transferred properties ? "

Senator Chataway - The honorable senator will admit that the Opposition, under Sir George Reid, strongly urged that that extra payment to the States should be regarded as a portion of the amount due for the transferred properties.

Senator DE LARGIE - I am not aware that any such contention was raised. If so, I am afraid it was put forward in a very indefinite and unbusiness-like manner. The point is, however, that nothing was done. To-day, we find ourselves responsible for the transferred properties and the £6,000,000 paid in excess of the constitutional obligation is not acknowledged in any shape or form.

Senator Chataway - We certainly owe money for transferred properties, for which we have paid nothing yet.

Senator DE LARGIE - What is the use of saying that, when the Commonwealth has paid , £6,000.000 to the States in excess of what it need have paid?

Senator Walker - We only gave back to the States what they had paid into the Treasury, and what we did not require for Commonwealth purposes.

Senator DE LARGIE - It' is useless to quibble about the point. The money was very much required tor Commonwealth purposes, lt must, at all events, be admitted that .to-day we are wiser than we were at the beginning of our Federal existence. Otherwise, provision would have been made either to spend this excess amount on the Federal Departments, where money was urgently required to make the services efficient, or we should have stipulated that the money was handed over to the States in part payment for the transferred properties.

Senator Chataway - That should have been done, but the. Labour party voted against it when it was proposed.

Senator DE LARGIE - I do not think the matter ever came to a vote. I have been a member of this Parliament throughout, and I do not remember such a proposition being made.

Senator Chataway - i admit that it did not come before the Senate.

Senator DE LARGIE - As far as i know, it never came before the other House either.

Senator Chataway - Oh, yes.

Senator DE LARGIE - However, we have now to consider the report that is before us. No matter what we might have done in the past, our mistakes will not get us out of our difficulties nor lessen our responsibilities in the future. Whether the present Government continues in office or whether the Opposition finds itself in the place of responsibility later on, there will certainly be an obligation to discharge in respect of the transferred properties, and also for new works in connexion with the Post and Telegraph Department. Before I touch on the matter of finance to any further extent, let me point out that when the Postal Commission entered upon its inquiry, it was found that the management of the Department had been far from satisfactory. We discovered that there had been a considerable amount of friction, for a number of years, between the chief officers of the Department in the various States and the Central Office in Melbourne. The old anti-Federal feeling had not disappeared. The Deputy Postmasters-General in the several State? suddenly found themselves in a secondary position. They discovered that they had to act under an official head located in Melbourne, and that they could no longer act entirely on their own responsibility. They felt that their importance had been somewhat diminished, and were inclined rather to pursue their own course than to obey orders which came from the Central Administration. I know that in Western Australia this difficulty was as apparent as in any other State. It certainly existed in Victoria. Indeed, we found the Deputy PostmastersGeneral in several States, instead of acting on the instructions received from the Central Office, as they should have done, inclined to throw obstacles in the way of the successful execution of those orders. Consequently, we had a state of affairs which could not make for success. In proof of these statements, it is scarcely necessary for me to refer to the report of the Royal Commission; but perhaps it would be just as well that I should read a paragraph so that honorable senators may be able to follow the various points upon which i shall comment. Paragraph 10 of the report states -

Whilst the experience of the heads of the States Post and Telegraph Departments was necessary in the drafting of a scheme of Commonwealth control, it was unwise to depend upon that alone in view of its limitations. Your Commissioners consider that before the Post and Telegraph Bill was submitted to Parliament a Royal Commission should have been appointed to inquire into and report upon the management and financial position of the services, including valuation of properties and bookkeeping systems, and also upon the advisability of obtaining the assistance of an independent organizer of exceptional ability, with experience in controlling post and telegraph affairs on a large scale, to advise the Government as to the best method to adopt in amalgamating six different Departments into a homogeneous whole.

We found when we entered upon our work that, instead of the Commission having been appointed too early, it was actually brought into existence six or seven years too late. We came to the conclusion that had a Royal Commission been appointed to inquire into the transferred Departments, and had an audit been made of the value of the properties we were taking over, so that our position might have been reviewed before we legislated, we should have been able to pass a Post and Telegraph Act much more suitable to the requirements of the Commonwealth than was the Act which was placed upon the statutebook. Paragraph 12 of the Commission's report says -

The evidence does not disclose that any effort had been made to ascertain whether the policy as formulated was properly interpreted bv the Deputy Postmasters-General. For a considerable period after Federation a good deal of friction, culminating in IQ07, existed between the heads of the States branches and the Central Executive. It was natural that the chief officer of each State, possessing State experience only, would endeavour to imprint on the Department the local system which he had assimilated, and which, probably for many years, he had controlled. Your Commissioners are of the opinion that, if the Central Executive had possessed itself of a better personal knowledge of the conditions affecting the Deputy PostmastersGeneral of the various States, the dissatisfaction which had existed between the Central Executive And the deputies would have been reduced to a negligible quantity.

Whilst I find fault with the men who were at the head of the Department in «ach State - that is to say with the Deputy Postmasters-General - the whole of the blame does not by any manner of means rest upon them. We found that there was a lack of sympathy in the Central Office, which did not do all that might have been expected to understand the various State officers, and to work in harmony with them. I dare say that if the whole subject had been gone into thoroughly a great deal of blame would have had to be apportioned to both sides. We have, however, got away from that state of affairs to-day. We now have established a better method of controlling the Department, and a larger measure of sympathy exists between the Central Office and the administrative officers in the States. One of the startling facts which we discovered in relation to the management of the Department was that the heads of the service were, in some cases, by no means well versed- in their business. That is rather an important statement to make, and one that should not be lightly made. But the investigation made by the Commission, and the evidence which was given, justifies us in coming to that conclusion. As a matter of fact, men who were at the top of the service, who held very important positions, and drew handsome salaries, had not so good an acquaintance with the work of the Department as had officers on the lower rungs of the ladder. We found some of these lower-paid officers much better acquainted not only with the work of the Commonwealth Department, but with postal facilities existing in other countries than were the heads of the Department in some States. This was especially noticeable in the case of an officer of the General Division in New South Wales - a gentleman who, when he had a holiday, spent it in investigating the methods which obtained in the British Post Office, and in the French Post Office. He came before the Commission and gave us a very large amount of useful information in regard to the improved working of the Department. But when we asked officers occupying the highest positions in the Department what they knew of the methods of postal management which obtained m foreign countries they had to reply that they knew nothing.

Senator Henderson - Was the man who was able to supply the information dismissed?

Senator DE LARGIE - I do not think that that drastic course was adopted. If justice were done, the gentleman to whom I refer would not still be in the General Division.

Senator Needham - He is still there?

Senator DE LARGIE - Perhaps the very fact that he possesses special knowledge, will be a bar to his promotion. That was the state of affairs which existed, so far as some of the heads of the Department were concerned. But a notable exception is Mr. Hesketh, the electrical engineer, who has travelled largely in America and in the United Kingdom. He was an fait with . the workings of the Postal Department quite outside his own particular branch, and from him the Commission received a great deal of assistance in framing their report. The conclusion at which we arrived in this connexion was that facilities should be granted to officers occupying high positions in the Department to visit other countries with a view to acquiring a better knowledge of the conditions which obtain in the Postal Departments of those countries. Mr. Hesketh benefited a great deal as the result of his visits abroad. The Government certainly paid his expenses,, and a similar course should be adopted in the case of other officers. Nor would I confine these visits to the heads of Departments. Even the humblest officer in the General Division - provided that he shows the requisite capacity - should be afforded an opportunity to go abroad and bring back the knowledge which he may gather in the course of his travels.

Senator Needham - The money would be well expended.

Senator DE LARGIE - It would be. One of the chief features of the scheme propounded in the Commission's report is a policy which, so far, has not received recognition either from the "Government or from the officials controlling the Department. The basis of that scheme is that a different method of managing our postal affairs should be adopted in the future. I am quite aware of the drawbacks inseparable from party government, and of their relation to a big Department like that ot the Post Office. In this connexion we ought not to forget that that Department has probably suffered more as the result of party government than has any other Department. When we recollect that since Federation was accomplished we have had no less than eleven Postmasters-General, it will be seen that anything in the form of a continuous policy has been almost impossible.

Senator Walker - How many UnderSecretaries have we had?

Senator DE LARGIE - Only two. But I would point out that the powers of the Under-Secretary are very limited indeed, even in matters of administration. The Commission recommends that, whilst we should not lessen Ministerial control of the Department, we should aim at having a continuous policy, and with this end in view it urges the creation of a Board of Management Instead of having a permanent head who in reality isfar from being what his title implies, owing to the political changes which occur from time to time-

Senator Gardiner - Paragraph 13 says that an incomplete conception of the Federal spirit existed among the Deputy PostmastersGeneral. What was the Commission's view of the Federal spirit?

Senator DE LARGIE - I have already pointed out, that in the early days of Federation there was an absence of the Federal spirit which should have been exhibited if successful administration was to be secured. The Deputy PostmastersGeneral in the various States - at Sydney, Melbourne, and Perth, for example - did not work in with the Central Office, as they should have done. The friction thus occasioned was a factor which contributed a great deal to want of successful management.

Senator Rae - The Deputy PostmastersGeneral ought to have been removed from one State to another from time to time.

Senator DE LARGIE - I do not know that that would have effected an improvement, but those officers are not now in the Department. The Board of Management recommended by the Commission would consist of a general manager, who would be its chairman, a postal director, and an electrical director. That is to say, the three chief branches of the Department would each have a representative upon it. Perhaps, if I read the paragraph in the report bearing on this matter honorable senators will be better able to grasp the system. Paragraph 55 reads -

Your Commissioners consider that, in order to insure sound and economical administration, a basic change is essential, and recommend that a Board of Management, consisting of three directors, namely, a general manager (chairman), a postal director, and a telegraph and telephone director, be appointed to control the Department. From a careful consideration of the requirements of the Department, it is deemed advisable to allot the functions and duties of the respective directors as follows : -

(1)   The General Manager should be chairman of the Board of Management, and should be immediately responsible for finance and general administration.

(2)   The Postal Director should be responsible for the management and general supervision of the mail services.

(3)   The Telegraph and Telephone Director should be responsible for construction and maintenance.

The next paragraph elaborates the position and states -

Your Commissioners are strongly of the opinion, from the evidence given and from personal inspection of the various branches of the Department, that the Board of Management recommended would effect great savings within a short period, in addition to the large savings which should result from the removal of staff matters from the control of the Commonwealth Public Service Commissioner.

That is an important departure from the existing method -

Evidence was given to the effect that the position of the Chairman of the Board of Management would be worth a salary of at least £2,000 per annum. Your Commissioners are not prepared to recommend the amount of salary necessary, but consider that, in order to secure suitable members for the board of. management, it is imperative that attractive salaries be provided, as the service requires the highest standard of administrative ability procurable.

Senator Walker - I do not think that £2,000 a year is a penny too much.

Senator DE LARGIE - I do not think it is, if we can find the right man for the position. The fact that there weretwo Labour representatives on the Commission, and that they did not wish to lessen thai amount, is a refutation of the chargewhich we frequently hear that Labour men are anxious to reduce all to a dead level of equality. Paragraph 57 of the report reads -

Under a Board of Management as recommended, the position of the Ministerial head would be that of the connecting link between the Parliament and the Department. The Minister would retain complete control of matters of policy as laid down by Parliament. Such Board of Management should equip Parliament through he Postmaster-General with reliable advice on the financial condition of the services, which would serve as a guide to Parliament and the Postmaster-General, and enable them to avoid alterations of a drastic character without the fullest consideration of all their bearings on vital issues.

Unfortunately, that method has not been pursued in the past because vital alterations have been made without any consideration being given to what would be their effect on the services which the Department is asked to perform -

The Board of Management should furnish the Parliament with an annual report covering the past year's transactions, including a balance-sheet disclosing the financial position of the several branches of the Department. Your Commissioners contend that without such guidance Parliament is unable to appreciate the necessities of . this enormous and ever-expanding Department.

So far as an annual report on the finances of the Department is concerned we have never had a complete one presented. It is true that a statement has been made concerning the financial position of the Post Office, but it has been of very little assistance in illustrating the real position.

Senator McColl - The honorable senator means a balance-sheet ?

Senator DE LARGIE - Yes, I mean a complete balance-sheet. The Commission found that no data were available which would indicate the true financial position of the Department. The various accountants were completely in the dark. When we asked them why they had not information to offer they, merely replied that they had been following the old method which obtained prior to the advent of Federation.

Senator McColl - We could never get a complete balance-sheet in regard to the Postal Department from the States prior to Federation.

Senator DE LARGIE - Unfortunately, each State was equally lax in this respect.

Senator Ready - Could not the officers give the Commission an approximate idea of the financial position?

Senator DE LARGIE - Several statements were made, but as no reliance could be placed on them the Commission had to ignore them.

Senator Henderson - Within a million or' two they knew nothing about the position.

Senator DE LARGIE - It was more than that, I think. I have already mentioned that the telephone branch in particular was in a bad state when the Department was transferred to the Commonwealth.

That state of affairs was allowed to continue for years until the public protested very loudly. The Postal Commission found that this particular branch had been starved, for the want of funds. In every State new metallic circuits and switchboards,which cost considerable sums, had been asked for by the heads, but they were told that no funds were avail-, able, and for that reason the services got from bad to worse. To make things still worse, instead of trying to secure all. the revenue which we could possibly have collected, we burnt the candle at both ends, so to speak. We not only reduced the vote to the Department for new works, but we also crippled our finances by reducing the telephone rates. This we are informed, by the heads of the Department, was done in defiance of advice tendered by responsible officials whose duty it was to advise the Minister of the day.

Senator Walker - Does that include penny postage to the United Kingdom?

Senator DE LARGIE - No; the telephone rates were reduced prior to the estatelishment of penny postage, and though penny postage was introduced by the Government of which I am a supporter, I think it was as great a blunder as was the reduction of the telephone rates. I am not here to cover up the sins of this Government when they do a thing of that kind, any more than are my political opponents.

Senator Rae - You are absolutely wrong.

Senator DE LARGIE - lt is all very well for such a remark to come from Sena-: tor Rae and those who were foolish enough to vote for penny postage before we could afford it.

Senator Rae - We can afford it easily enough.

Senator DE LARGIE - No. The fact that we cannot get sufficient money voted for new works and mail facilities in the back blocks, where they are much required,is very good evidence that we cannot afford penny postage. Australia adopted penny postage long before it was able to afford it. There is no country in which' mail matter is carried such long distances, officials are paid so well, and letters are carried at such small rates, as in Australia,

Senator Rae - The postage is quite enough. Let us get taxation from the rich' and we will pay that and more besides.

Senator Millen - What is the cost of penny postage?

Senator DE LARGIE - It is too early to say, I think.

Senator Millen - Do you remember the estimate which was given?

Senator DE LARGIE - , £400,000 a year.

Senator Millen - And that you say we cannot afford?

Senator DE LARGIE - No. .

Senator Millen - What will be the cost of the railway from Port Augusta to Kalgoorlie ?

Senator DE LARGIE - That is another matter, which will be dealt with when we are considering the financing of that railway. Financially, 1 think that it will do Australia a great deal of good.It will make remunerative many of the long mail services which are now being conducted at a loss. I desire now to refer to the accounts' system which the Postal Commission found in vogue. Take, for instance, the telephone branch. I have already mentioned that in 1907 the Postmaster-General reduced the telephone rates in opposition to advice tendered to him by the heads of his Department. The Postal Commission found that there was a considerable loss on the telephone branch. We discovered that people were very anxious to get telephone connexions, and that a very large number of subscribers resulted. There was an outcry about persons not being able to get connected, and so on. But when it was revealed that on every telephone which was erected there was a loss of at least 20s. or 25s. a year, we realized that the greater the number of subscribers secured the larger was the loss. The need for an increased amount was very obvious, I think, from the beginning. The increased revenue obtained has put the finances in a somewhat better position than they were in previously. If Mr. Thomas acted somewhat hastily in regard to penny postage he is entitled to somecredit for having put the finances somewhat straight, so far as the telephone rates are concerned. The Postal Commission recommended that the accounts should be put on a different basis. We advised that an accountant should be appointed to provide a better method of bookkeeping, and that a complete balance-sheet should be issued annually showing exactly the position of each branch, so that we might ascertain which was profitable and which was unprofitable. With this information in our possession we should be able to proceed much better, from time to time, with regard to alterations. In the past we were in the dark, and brought about reductions which, had the true financial position been known,

I do not think that Parliament would have been so foolish as to permit. The improvements which were effected after the Postal Commission was appointed, and the necessity for which was revealed during the inquiry, are enumerated on page 8.

Senator Rae - Have not some of these improvements involved new expenditure?

Senator DE LARGIE - Undoubtedly, and I think that we can very well afford it, too.

Senator Rae - According to your argument these improvements should be condemned.

Senator DE LARGIE - Why?

Senator Rae - Because we cannot afford these things.

Senator DE LARGIE - The honorable senator is treating the matter in a rather humorous vein, although it is a painful sort of humour.

Senator Rae - I understood that you were arguing that we could not afford these things.

Senator DE LARGIE - Among the improvements which have been made, and the service concessions which have been granted, are the following : -

1.   Increase in the permanent staff by making provision in the 1909-10 Estimates for 1,500 additional officers.

2.   Larger votes granted for telegraphic and telephonic construction works.

3.   Telephone rates remodelled.

4.   Position of Chief Accountant created.

5.   Chief Electrical Engineer's staff augmented.

6.   Introduction of Wheatstone instruments on Inter-State telegraph lines.

7.   Reduction of the number of grades of postoffices from thirteen to seven.

8.   Overtime worked in the General Post Office, Sydney, partly paid for.

9.   Accommodation obtained at the Central Railway Station, Sydney, for the Mail Branch.

10.   Sorting test simplified in May,1909.

11.   A conference of departmental officers held to investigate the question of broken shifts in the Mail Branch.

12.   Additional grade of Senior Assistant established.

13.   Age for the admission of telegraph messengers to Service increased, and age of retirement extended.

14.   Appointment of outside supervisors of telegraph messengers.

15.   A uniform Postal Guide introduced.

16.   Improvement made in the compensation allowed for Sunday work.

17.   Letter carriers' beats in Sydney readjusted.

18.   Privileges extended to temporary employe's.

19.   Procedure under punitive sections of Commonwealth Public Service Act simplified.

These are the principal improvements which were brought about before the report had been printed, so far as the management and the services of the Department are concerned. Another important recommendation made by the Postal Commission was the appointment of a Staff- Committee to perform .the work which is now performed by the Public Service Commissioner. Our recommendation, which appears at the bottom of page 22, reads as follows -

Some officers representing associations within the Service considered that the Commonwealth Public Service Commissioner safeguards their interests, and maintained that independent Commissioners would be directed by strictly commercial principles, and that the officers' status would be reduced.

Your Commissioners consider that those members of the staff who do their work thoroughly need not fear unjust treatment, as a competent Board of Management would dispense with promotion by seniority, and advancement would depend upon merit. In obtaining the requisite data to enable the Board of Management to act judicially, it would have the assistance of competent State Staff Committees, composed of officials possessing both technical knowledge and experience of postal affairs, which would insure equitable treatment to the members of the Service. It is obvious that the existing practice of basing promotion on seniority and merit combined does not result in obtaining the most efficient service. The adoption of the system proposed would be an incentive to the staff to aspire to a higher standard of efficiency. The only way to obtain a properly efficient and progressive Department is by recognition of merit and capacity for development. Recommendations on all vital matters presented by the associations during the course of the inquiry will be made and will be set out under " Organization."

The Staff Committee in each State would be composed of three officials.

Senator Rae - At the Central Office in each State, I suppose.

Senator DE LARGIE - Not necessarily. The Staff Committee in each State would be composed of three men in the Department, who know the value of the work which officers perform, and have a good knowledge of postal work in its various aspects. We felt that the control of the Department should be in the hands of men who know thoroughly its work. We had proof that it was a wrong principle to put at the head of the Department, to control promotions, or make appointments, a man who had not a complete knowledge of the technique and the value of the work to be done. We, therefore, recommended that so far as this Department is concerned the position of Public Service Commissioner should be abolished, and that in each State a Staff' Committee should take his place in making appointments or promotions in the service.

Senator Rae - If that rule were applied to the other Departments it would mean dispensing with the Public Service Commissioner.

Senator DE LARGIE - It will, of course, be for Parliament to say whether his office is to be abolished or not, and I agree that there would not be the same necessity for such an officer if we were to take the control of the officers of the Post and Telegraph Department out of his hands and put it into the hands of a Staff Committee. The Commission recommends that the Staff Committee should do this work, and common sense will suggest that they should be in a better position than any man outside the Department, who does not understand the work to be done, to say which officers should be appointed to do different kinds of work.

Senator Rae - Would the members of the Staff Committee retain their present positions, or would their whole time be taken up with the work proposed to be given to them ?

Senator DE LARGIE - Even if their whole time were taken up with this work, and that can only be discovered by actual experience, it should be no reason for refusing to adopt a more satisfactory system than that in operation at the present time.

Senator Walker - Can the honorable senator inform the Senate how many employes there are in the Post and Telegraph Department ?

Senator DE LARGIE - There are at least 13,000.

Senator W RUSSELL (SOUTH AUSTRALIA) - Too many for any one man to boss.

Senator DE LARGIE - As Senator W. Russell suggests, it is almost impossible for any one man to control so many officers engaged in different kinds of work. I do not wish to detract in any way from Mr. McLachlan's ability. I quite recognise that he is a very able man, and has done very valuable work. He has had many obstacles to overcome, and has had a very hard row tr> hoe, but I still contend that the head and manager of a Department should be responsible for appointments and promotions in' that Department, and is in a better position to judge the capacity and value of the services of those under him than any one outside the Department can possibly be. It is because we felt that the proposal we have made is essential to the good working of the Post and Telegraph Department that we made this recommendation.

Senator McGregor - Should we not have one Department doing the work in one way and another in a different way if that proposal were adopted?

Senator DE LARGIE - No, the Board Of Management would have a considerable say in the work of the Staff Committee.

Senator McGregor - That is dealing only with the Post and Telegraph Department. I was referring also to other Departments of the Public Service.

Senator DE LARGIE - Senator McGregor is aware that the report I am discussing deals only with the Post and Telegraph Department, and we need not al the present time trouble ourselves with other Departments. Since this report was tabled the Public Service Commissioner has published a memorandum upon it to which 1 should like to give some little attention. He criticises the report very severely, and questions many of the statements made in it. I think that it is only fair that a gentleman Occupying his position should be given some attention, as anything he may have to say touching a subject of this kind should be worthy of consideration. At the beginning of his report he says that the arguments in favour of a new order of things are neither convincing nor conclusive. I quite recognise that no matter what reasons we might give for the appointment of a Board <>f Management or a Staff Committee, if either the one or the other involved the abolition of his position we could hardly claim that they should convince him that we were fight in our recommendations. It would be like trying to convince a man sentenced to death that the sentence passed upon him was a just and proper one. I shall not, therefore, attempt to justify the recommendations of the Postal Commission to the Public Service Commissioner, hut I intend to prove that our recommendations would be for the good of the Department and the good of the Commonwealth, and that should be our first and last consideration. The grievances of the officers of the Department are not, I think, quite so pressing to-day as they were prior to the investigations of the Commission. Many of the recommendations of the Commission have been put into practice or partially adopted, and as a result it will be admitted that the officers are in a much better position than they were. I find Mr. McLachlan complains that he was not given ample opportunity to put his side of the case to the Commission. I think that is rather an unfair statement for the Public Service Commissioner to make, because he was kept in touch with the investigations of the Commission from the beginning. He was supplied with a copy of the evidence, and he was, with one exception, the very last witness to be examined. In the various States his inspectors were given ample opportunity to make the most complete statements. They were kept well posted with the evidence given by representatives of associations of officials in the Department. We endeavoured to afford them every opportunity to learn the nature of the evidence that was being tendered, so that they might be in a position to answer it. In the circumstances, 1 say that when twelve months after the report was tabled Mr. McLachlan complains that he was not given a proper opportunity to put his case his statement is rather an unfair one to make.

Senator Henderson - The Commission never curtailed his opportunities, did they?

Senator DE LARGIE - There was no curtailment of his opportunities. We asked him for a complete statement of his case. He submitted a typewritten statement covering, I think, about thirty pages, and on that he was examined at considerable length.

Senator Walker - Would the proposed Board of Management be non-political ?

Senator DE LARGIE - Certainly. It would have to do only with the administration, and not with the policy of the Department. Mr. McLachlan disputes the statements made to the Commission as to the salaries paid to sorters, letter-carriers, and such officers in New Zealand. He complains that we accepted evidence on the subject that was not reliable. I have here the classification list printed by the authority of the New Zealand Government, and I find that, according to the list for 1908-9, sorters and letter-carriers in the Dominion were then paid the very salaries which Mr. McLachlan disputes as being incorrect in the evidence tendered to the Commission. We were informed that they were paid as high as £200 a year. I have a list before me including quite a number of lettercarriers and sorters paid at from £180 to £200 per annum. The classification list for the following year, published by the New Zealand Government, includes even a larger number of these officers paid up to the rate of .£200 a year. It is therefore proved by New Zealand official publications that the evidence as to the rates of pay of these officers in New Zealand tendered by the representatives of associations in our Post and Telegraph Department was quite correct. Mr. McLachlan seems to think that the members of the Commission recognised no responsibility in making their recommendations. He suggests that they were very generous, and all that sort of thing, and that the representatives of associations asked for something quite unreasonable. However, we find that the recommendations we made have been accepted to a considerable extent by the Public Service Commissioner himself. It will be admitted that many of the recommendations to which he has objected must have been justified, or he would not have put them into practice, as he says in his memorandum he has done. I should like now to direct attention to the salaries paid to some officers at the time the Commission began their inquiry, and to compare them with the salaries the same class of officers are receiving to-day, and with the recommendations on the subject made by the Commission. If we take, for instance, officers of the Fifth Class of the Clerical Division, we shall find that they were formerly paid £40 a year to start with, and the salary advanced by regular increments up to ,£180. The Commission recommended that the salaries for these officers should run from ,£60 a year with annual increments until they reached ,£200. In the General Division the rates for mail officers were from £180 to £228. The Commission recommended 'that they should be from £210 to £240, and they are now receiving from £198 with annual increments until they reach a maximum of £228. The despatch officers were formerly paid at from £174 a year up to a maximum of £180. The Commission recommended that the salary of these officers should be £200 a year, and we now find that the Government have increased the salary in their case to £180 a year. Junior sorters formerly started at £144 a year and went up to £156. Senior sorters started at £162 and went up with the usual increments to £168. They are now receiving from .£144 to £168. The recommendation of the Commission was that they should, start at ,£150 and should go on until they received £190, which is a little higher than they are now receiving.' Letter-carriers formerly started at .£60 a year, and went on until they reached a salary of £150 a year, but it took them twenty years to reach that maximum salary. Now they start at £72 a year and reach a salary of £150 in twelve years, so that they reach the maximum very much more rapidly than they did before. Mail drivers and postal assistants receive the same salary. Linemen were formerly paid £114 per annum, rising by increments, until they received ,£150, but they took twenty years to reach the maximum. Now the salary paid commences at £126, rising until the amount of £150 is reached. The Royal Commission recommended that the salary should start at £120, and rise to £156. Senior linemen formerly received £144, and the maximum was £156. They are now being paid £144 at the commencement, rising to £156. Line foremen formerly received £162 at the beginning, rising by increments to .£168. The Royal Commission recommended that the salary at the commencement should be ,£168, t0 £J92- They are now receiving £168 at the commencement, rising to £180. Line inspectors formerly commenced at £174, rising to £348. The Royal Commission recommended that the minimum should be £200 and the maximum. £350! The Government has increased the salary to £192 at the commencement, rising to a maximum of £348. Mechanics - that is, fitters employed in the Telephone and Telegraph branches - formerly commenced as boys at the very small salary of £26 per annum, rising to £1 10. "The Royal Commission recommended that they start at £60, rising to £t6o, but the Public Service Commissioner has gone even better than we proposed to do. These mechanics now start at £72 a year, but the maximum is not so high as' that recommended by the Royal Commission, being only £180. Foremen mechanics formerly commenced at £162 and the maximum was £180. The Royal Commission recommended £200 as a minimum, and £250 as a maximum.-. The salary paid by the Government has been increased to £192 as a minimum, and £240 as. a maximum. Supervisors of telephones formerly commenced, at £132, rising to £150. Now they receive £144 as a minimum, and £156 as a maximum. But these officers have been placed in two grades according to the nature and . value of the work. In the higher grade the maximum is £168. The Royal Commission recommended' that they should start at £162, and that the maximum should be £180.

Senator Rae - I beg to call attention to the state of the Senate. [Quorum formed.]

Senator DE LARGIE - I have a few more figures to quote. I recognise that the quotation of figures is tedious, but I consider that these details are important. Telephone monitors formerly started at £114, rising to £i$o. Now they start at j£i26, rising to ^150. The Royal Commission recommended that they should start at .£120, rising to £i$6. Telegraph messengers formerly commenced with a minimum of £26, rising to a maximum of £51- The Government have increased the rates to a minimum of .£39, and a maximum of .£60. I find that these increases, according to a calculation made by the Public Service Commissioner, amount to an increase per annum in the General Division of ,£90,000, and in the Clerical Division of .£50,000, or a total of .£140,000 per annum. On page 20 of the Public Service Commissioner's memorandum there is a comparative statement showing how necessary were the increases of salaries provided for the officers. It also proves that the stand the officers made in relation to increases of salary was justified by the increases which the Public Service Commissioner himself has brought into existence. I find from these figures that so far from the Royal Commission having been extravagant, and having made recommendations without due consideration, the amounts that we recommended were, according to this statement, not so great as were those which the Public Service Commissioner himself recommended. According to this information the cost of the recommendations proposed by the Royal Commission would only be ,£37,650 per annum, as against increases of ^7.830 recommended by the Public Service Commissioner. I mention this statement to show that the Royal Commission did not, without due consideration, make any recommendations for increases of salary, nor did it do so without having sufficient proof that increases were thoroughly justified. I think I have now quoted enough to show that the recommendations put forward by the Royal Commission are justified both in relation to grievances and salaries. They are also justified as far as concerns the working conditions of the Department. But there are still many of our recommendations yet to be put into practice, and I hope that the further increases they involve will be made as early as pos sible. I claim to have proved that & new system of management is required in the Department, and that the kind of control that has hitherto existed will not suffice in the future. We require drastic alterations to be made. The report of the Royal Commission provides a better system of working the Department than has prevailed in the past. If this system were brought into practice we should have a greater degree of efficiency in the service, both in connexion with our mails and with the telegraph and telephone systems. The Government of the day, or the officials at the head of the Department, may wish to ignore this report. But to do so will not get them out of their difficulties. They will have to take steps to reform the Department. The alterations recommended by the Commission may be carried out in a piece-meal fashion, or the authorities may adopt this report of ours holus-bolus, and so revolutionize the system ; but of one thing I am assured- that, sooner or later, as time goes on, it 'will be proven that this report contains recommendations affecting the good working of the Department which will have to be adopted whether the officials manifest opposition to them or not. Having now spoken at greater length than I had intended - there are many things in the report I have not touched on, but I hope to deal with them when I reply at the close of the debate - I conclude by saying that' I have great pleasure in moving that the Senate approve of the Commission's report.

Debate (on motion by Senator Findley) adjourned.

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