Territory Stories

Debates Day 1 - Tuesday 8 October 1991



Debates Day 1 - Tuesday 8 October 1991

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Parliamentary Record 6


Debates for 6th Assembly 1990 - 1994; ParliamentNT; Parliamentary Record; 6th Assembly 1990 - 1994




Made available by the Legislative Assembly of the Northern Territory





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Legislative Assembly of the Northern Territory

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Attribution International 4.0 (CC BY 4.0)

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Legislative Assembly of the Northern Territory



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DEBATES - Tuesday 8 October 1991 to provide for its own needs. On this there can be no legal argument and I again issue my challenge to state MPs - legally prove otherwise, if you can. Even Sir - then Mr - Frank Nicklin clearly recognised the legal existence of this power of Queensland to provide for its own needs from its own state bank when, as Leader of the then State Opposition, he wrote to a very dear friend of mine - now deceased - under the date of 15 September 1948, and here is a photostat copy of that letter. Mr Nicklin said then, and I quote: ... it may be necessary for us, for our own protection, to exercise the rights we have under the constitution to establish our own state bank ... Legally then, every Queensland treasurer has possessed the power to advise the Queensland parliament to legislate to set up its own state trading bank, apart from a state savings bank, to provide all of its own financial needs. I challenge the production of any legal evidence that any state treasurer has ever given that advice, or recommendation to the parliament, as I challenge the production of any legal evidence that the state parliament has ever bothered to, cursorily, let alone seriously, examine and question Treasury advice in the light of the parliament's only legal-constitutional power to set up and use its own state bank to provide for all its own intrastate financial needs. In their defence, some politicians may try to claim that the state parliament was forced to tie up with the Commonwealth Savings Bank, rather than establish their own state trading bank, because of the terms and conditions of section 105A .of the Commonwealth Constitution and the 1927 financial agreement - an agreement which runs until 1985; that under those terms the state parliament has no alternative than to borrow money from the money market, the Reserve Bank or Commonwealth and private banks because the Loan Council has to approve all borrowings except short-term bank overdrafts. Such a defence would be an absolute public acknowledgement of a politician's supreme ignorance and failure to properly inform himself in these matters. The High Court, in the aforementioned Bank nationalisation case - see page 338 in 76 CLR (1948) - in referring to the 1927 financial agreement, clearly stated that: By it the state submitted to the control the Loan council with respect to public borrowing ... By no known application of constitutional law interpretation and construction could the advancement of credit facilities, by a state-owned trading bank to the state parliament for intrastate purposes, be legally classified as public borrowing. With respect to local government borrowing from the state-owned trading bank, with parliament's approval, neither section 105A nor the financial agreement could be called in aid by those who may try to challenge me on this point. However, the present method of Australian Loan Council gentlemen's agreements with the states on local government borrowing on the loan market is clearly ultra vires of section 105A and the agreement. Under the Queensland Local Government Act, every alderman and councillor who actually voted to raise such types of loans is clearly legally liable, individually and severally, for the 2675

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