MEMBER RESIGNS

New Zealand Herald, Volume LXXV, Issue 23111, 9 August 1938, Page 6

MEMBER RESIGNS

TJPPEK HOUSE SEAT VICTORIAN PARLIAMENT CONNECTION WITH COMPANY GOVERNMENT CONTRACTS [from, our own correspondent] MELBOURNE, August 3 Keen public interest has been taken in a politic.il development which has led to a decision by Sir George "Wales, a former Lord Mayor of Melbourne, to resign from the Legislative Council, to which he wfis elected two years ago. The development began when Mr. A. G. Allnutt, Country Party member for Mildura, speaking on a motion for the adjournment of tho Legislative Assembly last week, alleged the Sir George' had contravened the Constitution Act Amendment Act and was, therefore, not entitled to hold his seat in tho Legislative Council. Sir George, said Mr. Allnutt, was a shareholder in the Hardware Company of Australia Proprietary, Limited, which held Government contracts extending up to 1939. ' Thero were nine shareholders in the company. Section 24 of the Act provides for the disqualification from membership of Parliament of a person holding Government contracts or being a shareholder in a company of fewer than 20 shareholders which holds such contracts. Labour Party to Sponsor Candidate The secretary of the company (Mr. F. T. Hunt) said later that, although only nine shareholders were registered in the company at September 10, 1937, there had been more than 20 members on the share register for some months past. The Ministry instructed the State Crown Law authorities to investigate the allegations' of Mr. Allnutt, but in the" meantime Sir George tendered his resignation. He refused to comment on the position or to indicate whether he would recontest Jiis seat, which he would be entitled to do in view of the reconstitution of the company. In the meantime the Labour Party has announced that it will sponsor a candidate. Sir George was regarded as a United Australia Party member, although parties are not recognised officially in the Legislative Council. Sir George was Lord Mayor of Melbourne from 1934 to 1937, and his early term of office fell partly within the period of the centenary celebrations. He represented the city at the Coronation in 1937. He is still a member of the City Council. Bill to Amend the Act Although the Hardware Company and other companies with which Sir George is associated contract with the Melbourne City Council, the conditions of contract are different, and it has been generally accepted that, as long as no member of the council takes part in a debate on any recommendation in which as a trader he is'interested, he is com- ' plying with the Corporation Act. A bill to amend that Act was introduced in the Legislative Assembly recently, and one of its proposals is to tighten the conditions governing the acceptance of contracts. This bill has not yet reached the Legislative Council, and conflicting views on it are expected to be placed pertinently before the public at the forthcoming by-elec-tion to fill the seat vacated by Sir George. . The following statement was made today by Sir George's solicitors:—"Sir . George Wales, prior to his election on May 23, 1936, was and has ever since then remained a shareholder in Hard- • ware Company of Australia Proprietary, Limited. That company, prior to May, 1936, and up to the present time had one and only one contract in each year falling within the definition of section 24 of the Constitution Act Amendment Act. Small Benefits from Contracts "The total amount of goods supplied by the company under all these contracts since May, 1936, to date is £298 8s 6d, which represents .106 per cent of tnfe company's total turnover for the Period. Applying to this total figure tj»f company's ascertained rate of profit"* over its "whole undertaking during this period, Sir George's maximum possible interest or benefit as a shareholder in his own right in the contracts over the period is represented bv the amount of fivepence, and the total interests and benefits, direct and indirect, of himself, his wife and family by the amount of £1 75." A sequel to Sir George's resignation occurred in the Legislative Assembly yesterday, when the deputy-leader of the Opposition, Mr. W. S. Kent Hughes, moved the adjournment to discuss "a definite matter of urgent public importance, namely the position of members of Parliament with respect to Government contracts and also members of the public service under the Constitution Act 'Amendment Act.'' The motion was ruled out of order by the Speaker, Mr. T. Tunnecliffe, on the ground that the administration of . the Government was not involved.

Mr. Kent Hughes said a number of members were in danger unwittingly of being "shot out" unless th§ position was clarified.