The Prime Minister has forwarded for my advice the following letter:

I am forwarding herewith copy of the notes of a deputation which met me in Melbourne on the 8th May and which requested that the Commonwealth Government should pass legislation requiring any industry receiving a bounty to pay award wages to employees in that industry.

I should be grateful if you would arrange for this matter to be looked into and for a report to be furnished on the legal aspects associated therewith.

The power of the Commonwealth to legislate as to industrial laws is restricted to legislation with respect to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State. This power could not, therefore, be used to support the suggested legislation.

The power of the Commonwealth with respect to bounties is to make laws with respect to bounties on the production or export of goods, but so that such bounties shall be uniform throughout the Commonwealth.

The primary question is whether the Commonwealth when making a grant of a bounty may or may not impose conditions. Certainly it could not do so if the imposition of conditions would result in the bounties not being uniform but, although the matter is not entirely free from doubt, I am of the opinion that the grant of a bounty to all producers (or to all exporters) of certain goods subject to compliance with a condition which is uniform throughout the Commonwealth would not violate the requirements of the Constitution as to uniformity.

Whether the Commonwealth can make a bounty dependent upon the uniform conditions being fulfilled, when those conditions appertain to a sphere of law beyond the power of the Commonwealth, is a question not unconnected with the points at issue in Barger’s case (6 C.L.R. 41). It is significant that the dissenting judgments of Isaacs and Higgins, J.J., in that case really mark the birth in the High Court of those principles of interpretation which ultimately triumphed in the Engineers case (28 C.L.R. 129). How far the High Court would now follow the majority decision in Barger’s case is therefore open to doubt.

Assuming, however, the correctness of the Barger decision, as I have for the purposes of this Opinion, that case bears a marked distinction from the present problem. The legislation then under consideration, although passed under the guise of the excise power, was undoubtedly intended to secure the observance of certain standards of industrial conditions. According to the majority of the High Court, it was not a law with respect
to taxation.

To insert a condition, which must be observed before a bounty may be paid, would not, however, mean that the bounty legislation would cease to be a law with respect to the granting of bounties.

The worst that can be said is that the imposing of the condition is not a law with respect to bounties. That would be to say, however, that no conditions (other than those relating to Commonwealth power) could be attached to a grant of a bounty. In my opinion section 51(iii) would not be so narrowly interpreted by the Courts. It would, I think, be construing section 51 as if the power conferred were a power to make laws ‘granting bounties, etc.’, whereas the power is a power to make laws ‘with respect to bounties, etc.’.

I am therefore of the opinion that the power to make laws with respect to bounties includes a power to grant bounties subject to conditions (always providing the requirements as to uniformity are preserved) and that even assuming that the majority decision in Barger’s case will be acceptable to the High Court as at present constituted, the Commonwealth may make the grant subject to the observance of certain standards of industrial conditions so long as the real and primary object of the legislation is the grant of bounties.

From this it follows that I believe the past practice of including a special provision to this effect in all bounty Acts would be upheld by the Courts.

The question submitted for advice, however, appears to contemplate that separate legislation might be enacted specifying the observance of awards as a condition applicable to all bounties. Whether the Court would hold such legislation to be a law with respect to bounties is a question open to doubt and probably dependent on an answer to whether the High Court would or would not follow the decision in Barger’s case.

[Vol. 32, p. 366]