PARLIAMENT IN SESSION

Dominion, Volume 27, Issue 74, 20 December 1933, Page 12

PARLIAMENT IN SESSION

Second Reading Speeches on Finance Bill

LABOUR OBJECTION TO PROPOSALS

dejection of Hostile Amendment by 42 Votes to 24

.Morning, afternoon and evening “Xon House of Representatives yesterday. Second-read mg :sp q the Finance Bill (No. 2) extended over the three sessions. Stro ag iSSBEgs the National Expenditure Adjustment Act as from.Aprd 1, In protesting against the first-mentioned clause some OPP^ 1 ™ members stated.that they would use all t e orm: o S . p their command to impede its passage, even if it meant keeping ra H “ Rt Hon. J S G. Coates, said that when the workers compensat on legislation was first introduced into New Zealand it vvas not co templated that an employer would be responsible for personal injury to a worker caused by an earthquake while in th « co “ rs * of emnlovment. The Leader of the Opposition, Mr. M. J. Savage, said-cover could be obtained on a building against destruction by earthquake, but a person injured in that building during an earth nuake was to be given no cover at aIL 9 A™amendment that the Bill be refused a second reading was moved by Mr. J. A. Lee (Lab., Grey Lynn), who declared S no measure placed before the House had caused him greater indignation. A division was reached shortly before the supper adjournment, this resulting in the rejection of the amendment by 42 votes to 24. . . . r In order that those interested might have an opportunity ot giving evidence, the Native Affairs Committee has recommended that the Native Rating Amendment Bill, giving legislative effect to the report of the commission on rating on Native lands be not allowed'to proceed,

FINANCE BILL Hostile Amendment LABOUR OPPOSITION Insurance and Pensions EARTHQUAKE COVER Strong exception to the provision regarding tlie liability of insurance companies in respect of workers’ compensation claims arising out of earthquakes, and also to the proposal to legalise reductions in widows’, old age, miners’ and soldiers’ economic pensions were taken by Labour members at the second/ reading stage of the Finance Bill in the House of Representatives yesterday. They declared that the Government ■ was. safeguarding its own supporters at the expense of the working people, and a hostile amendment was moved by Mr. J. A. Lee (Lab., Grey Lynn).

not proposed to go as far as this, and the clause in the Bill limited exclusion of liability to accidents arising out of the real “community” risk —the risk of falling buildings and of fire following earthquake. This risk was the one to which all men in some degree were exposed, whether they came within the provisions of the Workers’ Compensation Act or not. ’ :. Mr. A. Harris (Govt., Waitemata): Is. there similar legislation in other countries? Mr. Coates: At the moment I cant answer that question. I will do so later. Mr. W. J. Polson (Govt., Stratford): The point is that the insurance companies have refilled to take the risk? Mr. Coates: Yes, they say they would have to go out of business. Mr. H. T. Armstrong (Lab., Christchurch East): A good thing for the country, too! Mr. Coates said that since the Hawke’s Bay earthquake disaster the Government had been seriously concerned to find some way of mitigating the financial loss which a severe earthquake entailed, without having recourse to public funds for rehabilitation purposes, as was necessary in 1931. One of the conclusions clearly established from the San Francisco and the more recent Napier earthquake was that the greatest damage to property was from fire-following an earthquake, but in common with the practice in other parts of the Empire, New Zealand fire insurance policies did not ordinarily provide against loss by fire following an earthquake. If such protection was required, it was necessary to contract for it and pay an increased premium, which was relatively high and more than the average insured could afford to pay.

In moving the second reading of the Bill, the Minister of Finance, Rt. Hon. J. G. Coates, said that the clause dealing with earthquake insurance was necessary as a result of the recent Privy Council decision in the case Brooker v. Thomas . Borthwick and Sons. (Aust.), Ltd., and related appeals. Mr. A. S. Richards (Lab., Roskill): Was the decision too humane for the Government? Mr. J. A. Lee (Lab., Grey Lynn) : A big bonus to party funds! Mr. Coates: It is a peculiar mind that will Interject like that, and a very unjust remark for any hon. member to make. ■ , Government members: H?ar, hear. Mr. Coates said that, broadly speaking, it was decided by the Privy Council: (1) Where a worker is injured by some force of Nature, e.g., lightning, heat of sun, extreme cold (unconnected with the employment), he cannot recover unless he can show he was exposed in a special degree by his employment to suffering such An injury, but if by physical contact with the place of employment injury results therefrom this associates the accident with the employment, and nothing further need be considered. If the roof falls on him or he slips on the premises, there is no need to make further inquiry as to why the accident happened. (2) The fact that a workman is injured in the streets while on Ids master’s business establishes an accident arising “out of” the employment, though the risk was shared by all members of the. public using the streets in like circumstances. Liability Never Contemplated. Mr. Coates said it could be reasonably suggested that when the workers’ compensation legislation was first introduced into New Zealand it was not contemplated that an employer would be responsible for personal injury to a worker caused by an earthquake while in the course of his employment, but by a long line of cases the construction j of the words “arising out bf” had been progressively broadened until the country' was now faced with a liability on employers which in the event of a disastrous earthquake In a thickly-popu-lated area would be unquestionably greater than could be borne. That liability had to be met even though the risk to the worker was no greater than to members .of the general public who might be equally exposed in the locality. '' "It may be contended,” said Mr. Coates, ’’that the risk is one which it Is possible for employers to insure against, but the contingent liability is so immeasurable that the insurance companies have stated their inability t<o continue to undertake it.” Mr. W. E. Parry (Lab., Auckland Central): Then we could do it ourselves.

, California’s Experience.

Mr. Coates: If the companies withdraw, the resources,of the State office might be totally inadequate to meet the liability, and of course lb would be useless to expect individual employers themselves to meet a responsibility which present Insurance resources find it impossible to undertake. Mr. R. Semple (Lab.,. Wellington East): Does this legislation arise out of the decision of the Privy Council? Mr. Coates: Yes, that is correct. Mr. R. McKeen (Lab., Wellington South) : You want to protect the insurance companies? Community Risk. Mr. Coates said that, from the purely practical point of view of finance, it was necessary to bring the present employers’ liability in the event of an earthquake disaster within limits which could be envisaged. It might be reasoned that no accident arising out of an earthquake should be compensated for on the ground that an earthquake was an act of God, but it was

“It is the case also," continued Mr. Coates, “that lessons taught by earthquake disaster are soon forgotten by the community in general, and property owners are inclined, with a return to normality, progressively to dispense with special insurance against the consequence of earthquake. Thus, to protect owners against their own shortsightedness in their own interest and to conserve the liquid resources of the State in the stress of earthquake catastrophe, it is considered that Are insurance policies should provide, as a usual term insurance against fire following earthquake.” Mr. Coates said it had been found necessary in the State of California to do so, and some of the Insurance companies operating in New Zealand were also operating in that State. Power, therefore, was taken in the Bill before the House to approve Are policy conditions and to ensure that they were uniform, but it was not-proposed to exercise that power until an agreement was arrived at with the insurance offices as to rates and conditions. It was recognised that the inclusion of the risk presented considerable difficulties both to the companies and the State Fire Office, and that it was necessary for the matter to be referred overseas and for the companies to consult together before finality could be reached, which might not be for some months. The clause was a step in the right direction. Protest By Mr. Savage. “I protest with all the sincerity of my being against this method of legislation," declared the Leader of the Opposition, Mr. M. J. Savage. “The most important legislation of the session is being rushed into a Finance Bill of 63 clauses at a time when honourable gentlemen are expected to make it possible for Parliament to rise to-morrow night. The responsibility is on members to say whether they are going to do that or not.”

Mr. Savage said the Bill was full of proposals that should be the subject of separate Bills. He 'wondered how long people would tolerate what was going on in,Parliament. He had greater opportunities than most people to study the Bill, and he was still wondering where many of the clauses would ultimately land the country. The subsidies to rabbit boards had been reduced by id per cent., and, curiously enough, the foljow’ing clause made a present of 10 per cent, to the racing clubs of the Dominion. He claimed to be a sport, and he was objecting to it. A man who was a sport would not have asked for it.

ment, the Minister asked who was going to accept, responsibility. He said it was impossible to arrive at anything like a premium that would cover the risk. That was a remarkable statement. They could arrive at a premium to cover the building but not the man who happened to be in it. He did not know that argument was any use to the Government.

Mr. Coates: We will be glad to have it. Mr. Savage said that in the end the people of New Zealand had to cover the risk, either by taking up collections, or in an organised way by insurance. “We are not going to desert anyone in disaster,” said Mr. Savage. Mr. Coates: Who is suggesting that?

Mr. Savage: The Government is suggesting it. In future we are going to desert the people who buffer from earthquake while following their occupations. Mr. Coates : Oh, nonsense. Mr. Savage said the clause meant nothing else. Mr. Coates: I did not suggest that at all. The honourable gentleman is arguing two ways.

Mr. Savage said he was arguing one way? The man who had got compensation out of the Hawke's Bay earthquake would not benefit in future if this became law. It was taking away a right that belonged to the workers to-day.

• Labour Amendment. The following amendment was moved by Mr. Lee:

Tins House declines to accord tlie second reading to a Bill which, while proposing to legalise irregular and illegal reductions of widows’ old age, miners’, and soldiers’ economic pensions, and while proposing to destroy important legal rights of wage-earners under the Workers’ Compensation Act, makes no provision for improving the position of the unemployed workers and their dependants, or for reducing in any way the prevalent destitution and distress.

“I do not know of any measure brought before this House that has caused me such indignation,” declared Mr. Lee. While the Government could do nothing for the old age pensioner, the unemployed man, the discharged soldier and the sweated girl, individuals known to be substantial contributors to party funds were able to get what they wanted. Mr. Coates: Nonsense. Mr. Lee: No one pours so much money into the political coffers as insurance companies. The Government yields to the dictates of those who control insurance corporations and the newspapers. The Minister knows these organisations are the main contributors to party funds. Mr. Coates: That is utterly incorPrime Minister, Rt. Hon. G. W. Forbes: I deny that statement. Mr. Coates (to Mr. Lee) : You are irresponsible. If the Insurance companies do not get protection they Will not take the risk. Mr. Lee: Let the State take the risk. ■ , Mr. Coates: That is another matter. _ . , Demand for Legislation.

Mr. Lee: Let us take the South British Insurance Company, from which came an incessant demand for this legislation. Mr. Coates: Let me say the Soutn British Company did not come into it. ' Mr. Lee: Sir George Elliot did not make representations! Oh, no. They were in the Press from one end of the country to the other. If wealthy insurance corporations or the banks want anything they can get it, but not so the ,farmer, the unemployed: man and the sweated labourer. The Minister says' I let my indignation run away with me. I am pleased it has. This Bill proposes to reverse a judgment of the Court; It sets out to determine that the. Court ruled in the wrong way.

Mr. Coates: Oh, no. Mr. Lee: That is what it amounts “Irresponsible Chatter.”

Another clause sought to validate the illegal Act of the Government in withholding pensions. Probably this had not been validated before because the Government had only a very slender majority when the pensions were originally reduced. People who weye to be affected by the Government’s legislation about irrigation were surely entitled to have an opportunity to state their side of the case, but no such opportunity had been given them. Earthquake Insurance. My. Savage criticised the clause dealing 'with earthquake insurance. If, as the result of an earthquake, the roof £eU on a man engaged at his employ-

Further remarks of Mr. Lee were described by Mr, Coates as “irresponsible chatter.” The Minister added that no representations had been made to him by the South British Insurance Company. Mr. Lee: Probably representations were made for the combined insurance offices. Mr. Coates: The only discussions I had were with the State Office. Mr. Lee: Resolutions were carried at the annual meeting of the South British Insurance Company and also by other companies,. According to the Minister those resolutions went nowhere. Where did they go to? Mr. Coates: They might have gone to the Minister in charge of the Government Insurance Department. Mr. Lee: Well, if the Minister of Finance did not rceeive them the Government did. The Prime Minister said he had not been approached by the insurance companies, but the K manager of the State Fire Office had informed him that the companies could not carry on in view of the Privy Council’s decision. Mr. W. E. Parry (Lab., Auckland Central), in seconding the amendment, said that the Bill had caused considerable disappointment, not only to the House, but to the country generally. More especially was it disappointing to those who were in difficult circumstances or had been in difficult circumstances for the last three or four years. There had not been one Bill during the session, including the present one, which had done anything to alleviate the difficulties of the great mass of the community. Members would go back to their constituencies only to meet the people poorer than when they left them. In the present Bill could the Minister point to a single thing that was going to assist the people to whom,he referred? Surely the Minister must realise that the proposal in connection with earthquake risk was going to penalise the 'workers of this country. He knew of the difficulties quite well, but the last speaker had been accused of having a miserable mind because he objected to the protection being taken away. The present Bill was no place for such legislation at all. How could the Minister justify the inclusion _of such a clause of such a far-reaching nature In the dying hours of the session? The Minister had the right to bring down an amendment to the principal Compensation Act, and to give every interested organisation, including the insurance companies, an opportunity to give evidence before a committee. The Prime Minister could not deny that right to give evidence. He asked the Prime Minister to withdraw the clause from the Bill.

"IrreguJar Reductions.”

Mr. P. Fraser (Lab.. Wellington Central) challenged any Government member to disprove one word of the amendment moved by Mr. Lee. The Bill, he said, proposed to legalise irregular reductions of pensions. The charge was admitted. The Prime Minister asked the House to believe that he made a mistake, that the law draftsman made a mistake, that the Pensions Department made a mistake, that the Minister in charge of the Bill made a mistake, and that the Legislature itself made a mistake. .

Parliament had passed the legislation authorising the pensions reduo-

tlons, not from April 1 but from May 10. What sort of action was the Government stooping to in trying to validate its mistake? Why had the Government not taken steps at the time to validate the discrepancy? The reason was that the Government had a majority of two on the division to reduce old age pensions and would not face up to a further division to try and validate what it had done in reducing pensions as from April 1. Right from April of last year until the present time the illegal operation of the law had been allowed to stand unvalidated. Unless the Controller and Auditor-General had drawn pointed attention to the matter it might have never been validated and the Illegality would have remained for all time, the Government trusting to the fact that the people affected were poor and had not the ordinary means to gain redress. There was tenderness of heart shown by the Government for the international money lenders, but an entire disregard for the welfare of the people. Referring to the clause in the Bill in connection with claims for workers’ compensation, Mr. Fraser said those most vitally concerned had had no opportunity to place their views before members. Even at the present late stage of the session the Labour Party was determined to oppose the proposal to the utmost.

"Purely Electioneering.”

Mr. S. G. Smith' (Gov., New Plymouth) said that all the talk which had come from the Labour benches was purely electioneering. He urged the Government to delete the clause in the Bill which made it necessary for a fee of 10/6 to be paid in the case of appeals to the Government Appeals Board, the fee being refunded if the appeal was successful. He said this would amount to a severe hardship to a Civil Servant who was in the unfortunate position of having to make an appeal, and he asked the Minister to drop rhe clause. ’ Mr. Parry: He’ll drop it all right. This is a “ready.”Mr. R. McKeen (Lab., Wellington South) said it was obvious that Mr. Smith’s request was a piece of propaganda, and that when the committee stage was reached the Minister would announce that “in response to representations from certain Government members” it had been decided to drop the clause. Mr. Smith: Anyhow, the member for New Plymouth is a good New Zealander. Mr. McKeen; I suppose the inference is that I am not a New Zealander. Well, I am not a New Zealander. Mr. Smith: Hear, hear. Mr.,- McKeen: I am a Scotsman. I would rather be born a man in Scotland than a fool Ln New Zealand, and an ass. Mr. Speaker: Order; Will the hon. gentleman please resume his seat? Did he apply those terms to a member of the House? Mr. McKeen: I did. Mr. Speaker: Well, thejion. gentleman must withdraw and express his regret immediately. Mr. McKeen: I am prepared to withdraw. Mr. Speaker: And to express regret I

Mr. McKeen: Yes. Rising to a point of order, Mr. Lee said there was no doubt it was in the mind of the member for New Plymouth that to be born other than a New Zealander was to be something offensive. Was the hon. member entitled to infer that the member for Wellington South was something offensive because he was a Scotsman, he asked.

Mr. Smith: No, no. Mr. Speaker: I need hardly ask the hon. member to give an assurance on the point. . . . Mr. Smith: I meant nothing offensive. I come from Scottish descent and I am proud of it. Mr. Parry: Well, why did you make the remark you did?

Mr. Speaker: Tlie House seems very restless to-night, and I may liave to take steps to deal with some hon. member. I don’t want to do that with the holiday season coming on. I must ask hon. members to restrain themselves and not to interject.

Mr. McKeen added that in the dying hours of the session the Government was handing back to racing clubs money that should go into the revenue of the country, and at the same time refused to honour its mistake and to pay to the pensioners what they were entitled to.

Mr. A. M. Samuel (Ind., Thames) said the Bill contained so many policy questions that it warranted the adjournment of the House until after Christmas, because hurried consideration of such important legislation was not in the best interests of the country, He thought the Government was illadvised in inserting in the Bill the clause dealing with pensions. Seeing that a mistake had been made 1, thought the mistake was one that should be paid for by the Government, which was responsible. Shortly before tjie supper adjournment a division was taken on the amendment; which was defeated by 42 votes to 24.

Mr. R. Semple (Lab., Wellington East) said the Bill ought to be called the Validating Bill and not the Finance Bill. It was validating many funny things. Many of the deaths in the Napier earthquake were caused by shoddy buildings, and if the clause were passed; it would mean that employers could erect buildings not fit for men to work in. The contractor who built the Nurses Home at Napier should have been put on trial. The home was a mere skeleton, a death trap. If the House passed legislation against what the highest court in the British Empire declared to be a right and proper interpretation of the law, if the House exempted wealthy insurance companies, what was going to happen in the years to come? The clause was a dangerous one, and he appealed to the Government to withdraw it. “If the Prime Minister insists upon that clause going into the Bill, then we will exhaust all the forms of this House in order to defeat it,” Mr. Semple said. In reply, Mr. Coates said he thought an arrangement had been come to that should be satisfactory in the meantime. He had an amendment drafted providing that in the case of any one disaster or series of disasters occurring within seven days the insurance companies and those they indemnify would not be liable for more than £50,000. That was about the amount represented in the Hawke’s Bay earthquake, and he thought the Insurance companies had met the position very fairly. He could give an undertaking that a Workers’ Compensation Act would be introduced next session, when the whole question would be thoroughly and completely investigated. The Bill was read a second time. The House then went into Committee to discuss the clauses in the Bill. (Left sitting.)

PETROL COMPANIES

Prime Minister’s Promise of

Fair Treatment

“BILL ON RIGHT LINES”

An assurance that petrol companies would receive fair treatment was given by the Prime Minister, Rt. Hon. G. W. Forbes, when moving the second reading of the Motor Spirits (Regulation of Prices) Bill in the House of Representatives early yesterday morning. Mr. Forbes said the Bill was to give effect to the recommendation of the Industries and Commerce Committee in its report on the petitions of the Associated Motorists’ Petrol Co., Ltd., the South Island Motor Union, Incorporated, and the New Zealand Farmers’ Union, Incorporated. These organisations petitioned tor the enactment of legislation to provide for the fixation of prices of petrol so as to prevent unfair competition or for any other action that might be advisable in the public interest. The Bill provides for the issue of an Order-in-Council fixing maximum and minimum prices of petrol. After mentioning the steps taken by the Government to .regulate transport, Mr. Forbes said it was felt that the supply of petrol could no longer be left to any uncontrolled interest. The Government had to take action to see there was no exploitation and unfair practices. The Bill was in the interests of the motor industry. It was Recognised that a great many thousands of pounds were invested in the petrol industry in this country.. Traders had a right to fair treatment, and he could assure petrol companies they would receive it. The Leader of the Opposition, Mr. M. J. Savage, said the Bill was on the right lines. The Government was really forced to do something to maintain reasonable conditions in the trade. He felt sure the Bill would meet with the wishes of members. The Bill was read a second time. MORTGAGE RELIEF Amendments to Measure VOLUNTARY SCHEMES Amendments made to the Mortgagors and Tenants Relief Bill by the Statutes Revision Committee were reported to the House of Representatives last evening. The original proposal was to give power to the courts to bind, stock mortgagees, and the Bill itself provided for a scheme of distribution of the proceeds of farming operations. For this provision has been substituted authority for the court to bind stock mortgagees not entering into voluntary arrangements with mortgagors. The court can then make an order along lines that it considers equitable. As a guide four voluntary pooling schemes actually in operation are given as a schedule. They are arrangements between (a) stock mortgagees and the Public Trust; (b) stock mortgagees and the State Advances Department; (c) stock mortgagees and the Lands Department; (d) stock mortgagees and the banks, , , ■ . ■ i Provision has also, been made in the amended Bill for the prevention of any process of execution by way of judgment or bankruptcy proceedings which would tend to upset schemes either voluntary or. by order of the court. The other amendments are merely of a machinery nature and designed for the better administration of the Act. The clause authorising the abolition of the personal covenant in mortgages on property owned by religious, charitable or educational bodies has been struck out of the Bill. CITY MILK SUPPLY Wider Powers of Inspection CRITSC IN UPPER HOUSE Some opposition was met. by the Wellington City Milk Supply Amendment Bill, a measure designed to check “bootlegging” in milk so far as Wellington is concerned, when it reached its second reading in the Legislative Council yesterday. The Hon. C. J. Carrington contended that the Bill went a little too far in giving power to inspectors to examine milk supplies which they merely suspected to be in excess of regulations. Mr. Carrington proposed to amend the clause in question by substituting the words “reasonable means to believe” for “suspect.” There was a distinction between the two, he said. He objected to the clause altogether He thought there was just a little too much power given to inspectors.

The Rt. Hon. Sir Francis Bell said the Act gave an inspector power to inspect milk, and the question was whether this power could be used outside the city. Mr. Carrington said if the provision were included in the Police Offences Act) a person might be accosted by any constable on mere suspicion. It appeared to him that the clause in the Bill gave an inspector power to stop any person whom he suspected. Surely it was enough that an inspector had the power bo examine where he had reasonable belief that the regulations were', not being carried out. Sir Francis Bell said if Mr. Carrington's suggestion were adopted, it would have to be proved whether an Inspector had reasonable cause to suspect. The difficulty would be what was “reasonable cause.”

Mr. Carrington said he did not intend to propose the amendment. He would withdraw it, although he certainly would vote against the clause." On a division being taken, the clause was carried by 11 votes to 2, Mr. Carrington and Sir James Allen being the two dissentients. The Bill was .put through the remaining stages and passed. BILLS BEFORE COUNCIL The following Bills were passed by the Legislative Council yesterday: The Bluff Harbour Board and Bluff Borough Council Empowering Bill, the Wellington City Empowering and Special Rate Consolidation Amendment Bill, the Napier Harbour Board and Roman Catholic Archbishop Enabling Bill, the Petone and Lower Hutt Gas Lighting Amendment, the Hawke’s Bay Rivers Amendment Bill, the Whakatane Harbour Board Vesting Bill, the Wellington City Milk Supply Amendment Bill, the Waimakariri River Amendment Bill, the Napier Harbour and Napier Borough Enabling Bill, and the Napier Harbour Board Loan BilL