In relation to the Social Services Consolidation Bill, introduced in the Senate, I am asked to advise—

1.  Whether, having regard to the third paragraph of sec. 53 of the Constitution, the Senate may amend the Bill so as to increase from 5/- to 10/- the weekly endowment for the first child;

2.  Whether, having regard to the first paragraph of sec. 53, the Bill is one which may properly originate in the Senate.

Proposed laws

To begin with, sec. 53 differs from sec. 55 in dealing throughout, not with ‘laws’, but with ‘proposed laws’. The avowed intention was that the requirements of the section should be regarded merely as matters between the two Houses, and that, when a proposed law had become a law, the fact of non-compliance with these requirements should not affect the validity of the law. There are a number of dicta of Justices of the High Court that this is the effect of the section: see Osborne v. Commonwealth, 12 C.L.R. at pp. 336, 351–3, 355–6, 373; Buchanan v. Commonwealth, 15 C.L.R. 329; Comm’r of Taxation v. Munro, 38 C.L.R. at pp. 188, 210.

It seems clear that questions arising under sec. 53 are matters of Parliamentary procedure, argument as to which can be addressed only to the Houses.

Charges or burdens on the people

The words ‘charge or burden on the people’ are apt words to describe the imposition of taxation. It has been suggested that they also cover appropriations of money; and also that they cover such matters as the relevant provisions of the Social Services Consolidation Bill—namely, provisions which, though they do not appropriate money, yet in combination with Appropriation Acts affect the amounts which will be expended.

All these questions raise difficulties of interpretation of sec. 53. Before discussing these difficulties, it is worth while to see whether any guidance as to the intended meaning can be had from the Debates of the Conventions of 1891 and 1897–8, seeing they are questions to be decided in the political arena, and not in courts of justice where such an examination would probably be considered irrelevant.

Proceedings in the 1891 Convention began with some general resolutions moved by Sir Henry Parkes, one of which was that the House of Representatives should possess the sole right of originating and amending all bills appropriating revenue or imposing taxation. (Deb. p. 23). In the ensuing discussion there was much difference of opinion about the power of the Senate as to money bills. At p. 449 Sir Henry Parkes strongly supported the resolution, and said:

All taxes levied must be burdens on the people of the country. The freest condition would be to have no tax; and every tax, let it take what form it may, is a burden upon a free people. Every expenditure derived from the revenues produced by these taxes must affect the people in the same way in which the imposition of burdens affects them.

He went on to say that the principle was that the popular chamber should alone be entitled to deal with measures ‘affecting the imposition of burdens and the distribution of revenue derived from the taxes so imposed’; and that it was not consistent with this that the Senate should have power to veto in whole or in detail ‘any bill introduced for the purpose of expending money … or for increasing the burdens of the State.’

Eventually it was agreed to limit the resolution to origination, as to which all were agreed, on the understanding that a Committee would work out an acceptable compromise to submit to the Convention (p. 463).

The clause brought up by the Constitutional Committee (of whose discussions there is, so far as I know, no available record) was, except for minor matters of form, almost identical with secs. 53 and 55 of the Constitution (see p. 706). In introducing the Committee’s draft bill to the Convention, Sir Samuel Griffith (p. 526) described the compromise as not allowing the Senate to amend the annual appropriation bill or bills imposing taxation, but giving it the power to suggest amendments on the lines of the South Australian practice. He made no mention at all of charges or burdens.

According to Mr. Dibbs (p. 752) the Committee had been ‘talked into’ the compromise by Sir Henry; and the only further allusion I can find to ‘burdens’, was by Sir Henry on p. 271, where he said that if an amendment upsetting the compromise were moved, he would submit another amendment restricting the Senate from amending or touching bills appropriating revenue ‘or imposing new burdens upon the people.’

I cannot find that the phrase was mentioned at all in the Convention of 1897–8, when after much debate—in which the talk was of ‘money bills’ without further specification—the 1891 compromise, though fiercely attacked from both sides, was ultimately adhered to. And I cannot find anywhere any suggestion that the section was intended to apply to anything but appropriation and tax bills. On the contrary, in the 1891 Convention Sir Samuel Griffith (at pp. 714–5) said: ‘As to all laws, except two classes, the rights of the two Houses’ (seil. as to amendment) ‘are absolutely co-ordinate.’ And he named the two classes—the annual appropriation bill and tax bills.

The above extracts suggest, for what they are worth, that the words were probably those of Parkes; that he regarded them as referring to taxes only; and that Griffith did not regard that provision as a particularly important part of the compromise. 

In support of the proposition that the words are also apt words to apply to appropriations, it may be argued that an appropriation of moneys, if followed by expenditure, can only be met out of public moneys, and charged either against the Consolidated Revenue Fund or a Trust Fund; that it thus diminishes the public resources, and must in the end result in a reimbursement by taxation which would otherwise be unnecessary; and therefore that it is equivalent to, and so is in effect, an increased charge or burden on the people; that the public moneys belong in a sense to the people, and a charge or burden on them is to all intents and purposes a charge or burden on the people. Some such arguments, in the case of the Sugar Bounty Bill, were used in 1903 in opposition to the Senate’s claim to a right to amend the Bill, and are summarised by Harrison Moore, in his book on the Constitution, p. 149. But the reasoning seems too remote from the text. A charge or burden on the revenue is not, in the Parliamentary sense, a charge or burden on the people; it does not act on the people at all, but only on a Fund derived from past charges on the people. And the results suggested, of increased taxation, are altogether speculative. It does not follow from increased appropriation that there will be increased expenditure; not does it follow from increased expenditure that there will be increased taxation. What the paragraph forbids is an increased charge on the people; a mere appropriation does not constitute such a charge.

Charge or burden in the Context

If that is the natural meaning of the words ‘charge or burden’, read by themselves, is there any compelling reason in the context to give them any other meaning?

If the paragraph refers only to proposed laws imposing taxation, why does it not say so straight out, without introducing a new phrase? Besides, there would be no point in forbidding the Senate to amend upwards a proposed law which it may not amend at all.

And even if it were meant to include proposed laws appropriating moneys for other than the ordinary annual services, why not say that plainly?

It seems that if the paragraph is to have any effect at all, it must refer to proposed laws other than proposed laws imposing taxation or appropriating moneys. And the words are ‘any proposed laws’, without qualification. The suggestion adverse to the Senate’s power is that the paragraph refers to proposed laws which, without appropriating money, affect the amount of expenditure.

But to give the paragraph an effect, there is no need to stretch the words ‘charge or burden’. It could equally apply to proposed laws which, without imposing taxation, affect the amount of taxation.

A case the draftsmen may have had in mind is that of a bill, not a money bill in any sense, into which the Senate might wish to insert a clause increasing a charge or burden, in the proper sense of the words. To give the paragraph an effect, it is quite unnecessary to stretch the words beyond their natural meaning.

I cannot see that there is anything in the context that requires that.

(It may be, by the way, that the reason why the paragraph escaped clarification in the revision stages of the Convention is that it formed part of the early compromise in one of the most critical issues—a compromise that had been more than once attacked and narrowly escaped defeat, and to tamper with which was dangerous.)

Bill originating in Senate

Independently of the above reasoning, I think that sec. 53 does not apply to bills that originate in the Senate.

The fourth paragraph provides that the Senate may return to the House of Representatives any proposed law which the Senate may not amend. These words certainly suggest that the proposed law has come from the House of Representatives; that is, that the prohibition of amendment only applies to proposed laws that have come from the House of Representatives.

This is in accord with the purpose of the whole section: that in case of a difference between the two Houses, the House of Representatives shall be responsible for the form of the bill—though the Senate has a voice as to whether, in that form, it shall become law.

It would be pointless to forbid the Senate to amend its own bill, when it can achieve the same result by withdrawing the bill and re-introducing it with the amendment.

Moreover, any amendment which the Senate may not make it may request the House of Representatives to make. It would be absurd for the Senate to send its own bill to the House of Representatives with a request for amendment.

My answer to the first question asked is, therefore, that in my opinion the Senate may make such an amendment—

(a)  because the amendment does not increase a proposed charge or burden on the people; and

(b)  because sec. 53 does not apply to bills that originate in the Senate.

Does the Bill impose taxation or appropriate moneys?

It clearly does not impose taxation. The matter of appropriation needs further consideration.

Sec. 81 of the Constitution provides that—

All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth …’

The National Welfare Fund Act 1943–1945 establishes a Trust Fund (within the meaning of the Audit Act, sec. 62A) to be known as the National Welfare Fund, and provides that in each financial year there shall be paid out of the Consolidated Revenue Fund, which is appropriated accordingly, certain fixed sums, to be applied for the purpose of the National Welfare Fund. Moneys standing to the credit of the Fund are to be applied in making such payments as are directed by any law of the Commonwealth to be made from the Fund, in relation to … welfare or social services.

The Principal Act which the Social Services Consolidation proposes to amend makes detailed provision for different kinds of pensions and benefits. Sec. 136 of the Act directs that payment of benefits under the Act (except certain expenditure to be made out of moneys appropriated by Parliament for the purpose) shall be made out of the National Welfare Fund.

The Bill provides certain further benefits: particularly an endowment of 5/- weekly in respect of a first child.

Neither the Principal act nor the Bill contains any provision for any appropriation of money from the Consolidated Revenue Fund.

In my opinion, the appropriation, within the meaning of secs. 81 and 53, is by the National Welfare Fund Act, not the Social Services Consolidation Act. The former Act appropriates the money, for a purpose of the Commonwealth, subject to the condition of a further direction before expenditure; and the fact that the further direction is to be by a law of the Commonwealth does not affect the fact that the appropriation is effected by the former Act.  See N.S.W. v. Commonwealth, (the Surplus Revenue case) 7 C.L.R. 179; Pharmaceutical Benefits case, 71 C.L.R. 237; and cf. Surplus Revenue Act 1908, sec. 5.

Addendum

By way of historical reconstruction, I picture Parkes’ mind as working something like this:

I don’t trust these cold lawyers’ words—‘imposing taxation.’ Something might slip past them on a technical point. Let us have a good democratic statement’s phrase, that says just what we mean; no increase of charges or burdens on the people. Something that will appeal to the people at the hustings.

And the lawyers let them slip in, to please the old man. They seemed to be sound political philosophy, and no one made any close investigation into their exact application, or how they fitted in with the rest of the section. Parkes himself seemed to be the only man who set any store by them, and he took every opportunity of airing them. In the subsequent debates, in 1891 and 1897–8, the fight concentrated on requests as distinguished from amendments: whether they were thinly disguised amendments, or just an opportunity for the Senate to inform the House of Representatives of its views; and the ‘charges or burdens’ faded into the background.

[Vol. 39, p. 98]