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Tuesday, 12 November 1974
Page: 2274

The CHAIRMAN -Senator Laucke, you are in order in dealing with the matter now.

Senator LAUCKE - Thank you. In the report of Estimates Committee C the Committee has reaffirmed a recommendation made by that Committee in November of last year. This recommendation reads:

That the matter of the interpretation of the 1965 compact insofar as it relates to new policies should be referred to the Senate Standing Committee on Constitutional and Legal Affairs.

I shall explain the compact at length in a few moments. Estimates Committee C decided unanimously that at the conclusion of the Senate's consideration of Appropriation Bill (No. 2) I should seek leave of the Senate to move a motion which, if passed, would refer the interpretation of new policies to the Constitutional and Legal Affairs Committee. There may be a number of honourable senators not conversant with the implications of the matter which I now raise. I point out that section 53 of the Constitution provides, in part:

The Senate may not amend proposed laws imposing taxation, or proposed laws appropriating revenue or moneys for the ordinary annual services of the Government.

Section 54 of the Constitution states:

The proposed law which appropriates revenue or moneys for the ordinary annual services of the Government shall deal only with such appropriation.

The question of the interpretation of the Constitution as to what revenue or moneys should be considered as falling in the category ' for the ordinary annual services of the Government' has since Federation been regarded not as a matter for the Government's interpretation or for that of the High Court but rather as a matter to be decided by the Parliament. In 1964 the then Leader of the Government in the Senate announced a government decision as follows:

Briefly, the Government has decided that, from 1964-63, the contents of the Appropriation Bill and the Appropriation (Works and Services) Bill will be amalgamated, subject to the separation out and inclusion in separate measures of any particular items which, as a matter of interpretation, do not fall within the description of appropriations for the ordinary annual services of the Government.

In the debate on the motion to take note of the statement an amendment was moved as follows:

That the Senate refrains from the determination of its constitutional rights in respect of the proposed change in the contents of the annual Appropriation Bills and resolves to consider such Bills.

The Appropriation Bills 1964-65 were in fact presented in the form that the Government had proposed but a committee of government senators was set up under the chairmanship of Senator Sir Mangus Cormack to inquire into the matter and to present a report to the Government. It was finally presented to the Parliament in 1967. It is Parliamentary Paper No. 55. The personnel of that Committee were Senator Sir Magnus Cormack then Senator M. C. Cormack- as Chairman, and Senator G. C. McKellar, Senator Wedgwood and Senator Wright. The introductory lines of the report from that Committee of government senators on Appropriation Bills and the ordinary annual services of the Government read as follows:

The 1964 decision to change the form of the annual Ap-

Sropriation Bills involves a reduction in the powers of the S enate.

Certain recommendations were made in respect to the method of handling Appropriation Bills, not as a composite set of financial figures but with separation. Discussion followed the tabling of the report and the then Treasurer announced what is now known as the 1965 compact to which I referred in my opening remarks. It is recorded in Hansard No. 46 of 1965 at pages 1484-1485 as follows: the Government has now decided that henceforth there will be a separate Bill, subject to amendment by the Senate, containing appropriations for expenditure on-

(   a ) The construction of public works and buildings;

(b)   The acquisition of sites and buildings;

(c)   Items of plant and equipment which are clearly definable as capital expenditure;

(d)   Grants to the States under section 96 of the Constitution; and

(   e ) New policies not authorised by special legislation.

Last year members of Estimates Committee C queried whether it was appropriate that proposed expenditure for the national health insurance plan and the National Commission on Social Welfare should be included in Appropriation Bill (No. 1) for 1973-74, a Bill which the Senate could not amend or in Appropriation Bill (No. 2) which the Senate could amend. In other words, should provision for moneys to cover new policies be included in a Bill for annual services which could not be amended or should it be included in the other set of financial papers- in Appropriation Bill (No. 2)- which the Senate could amend? The reply of the Treasurer at that time, Mr Crean, to the Committee reads in pan:

In determining bids to be included in Bill No. 2 (Document B) for these Commissions I have observed the undertaking given by the then Treasurer, Mr Holt, which was expressed in Hansard, Volume 46 pp. 1484-1485 of 13 May 1965 as follows: the Government has now decided that henceforth . . .

There is again listed the items which would be the subject of inclusion in Appropriation Bill (No. 2). Mr Crean went on to say:

This undertaking followed Mr Holt's separate discussions with a committee of Government senators and representative members of the House of Representatives in May 1965 in order to reach agreement on how to proceed on the recommendations of a committee appointed by Government senators on 'Appropriation Bills and the Ordinary Annual Services of the Government '.

He proceeded:

The undertaking (e) above in relation to new policies was in fact a precis of recommendation (8) contained in the Committee's report of 28 October 1964:

Recommendation (8), with the heading 'New Policies' which is underlined, states:

As far as possible, the first provision for new policies which have not been authorised by special legislation, and for which the annual Parliamentary authorisation proposed is an Annual Appropriation Act -

This is underlined - should be included in a Bill for other than the ordinary annual services of the Government.

Mr Creanstated further:

The underlining has been added because it highlights the crux of the issue which distinguishes the provisions to which your Committee took exception, from other provisions for new policy included for the first time in Document B. It seems to me that the proposed expenditures questioned by members of Committee C conform in that the Social Welfare Commission Bill 1973 is now before the Senate and 1 understand that the Minister for Social Security intends to introduce the Health Insurance Commission Bill 1 973 during the current sittings.

Moreover, the practice followed this year is consistent with that adopted in the past, e.g., the provision for the Australian Commission on Advanced Education, Division 237, Appropriation Act (No. 1) 1971-72 (the enabling legislation was assented to on 9 December 1971) and the provision for the administrative expenses of the Anglo-Australian Telescope Board, Division 234, Appropriation Act (No. 1) 1970-71 (the enabling legislation was assented to on 4 November 1970).

I feel that the Treasury interpretation of recommendation 8 of the Government Senators' Committee on Appropriation Bills is acceptable as a literal interpretation. But, I cannot, and in November 1973 Estimates Committee C did not, feel that the interpretation made was in the spirit of the 1 965 Compact. To accept such an interpretation would be tantamount I believe to agreeing that a Government could place any financing for new policies in a Bill which the Senate may not amend purely on the basis that the required legislation would be forthcoming at a later date. The Senate would be called on to pass finance for new policies, legislation for which may not have been even seen at that time by any member of the Parliament other than immediate Party members.

The more practical course would appear to be for funds for new policies which had not received legislative authorisation at the time of the Budget to be included in the Appropriation Bill which the Senate may amend. However the matter is a complicated one and for this reason I consider that a committee of the Senate should investigate the matter and report to the Senate. In considering the estimates for 1974-75 Estimates Committee C found two matters which it doubted should have been included in the Bill which the Senate may not amend.

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