Port Moresby, 28 February 1969
Confidential
On 31st January, 1968, I wrote to you giving certain observations on policy matters which had occurred to me in my first year as Administrator.1 You told me orally that you were in full agreement with them. I therefore felt that I had authoritative guidance on certain broad policy issues to serve as a basis for directing the Administration’s efforts in 1968.
In this letter I shall review the conclusions of my earlier letter in the light of developments during 1968 and seek your broad endorsement of them as guidelines for Administration activity in 1969.
My first conclusion of a year ago was—
‘ that economic development in the wide sense is the most important thing for the Territory and should continue to receive priority attention’.
There were two subsidiary conclusions—
‘that economic progress is bound to be slow and even partial viability many years off’;and
‘that correct economic policies need public support. A special effort is needed to make development a national task which captures the public imagination’ … 2
Certain qualifications were mentioned in my supporting text, notably a suggestion for ‘some slowing down in the present forced pace of economic development, with a consequent reduction in some of the social strains involved’.
The year 1968 has seen the completion of the Five Year Programme, the endorsement by the Commonwealth Government and the House of Assembly of its objectives and targets as a guide to planning and certain mutually conditional financial undertakings by the Government and the House.3The year has also seen for the first time the magnitude of the potential economic benefit to the Territory and the Australian taxpayer of a successful exploitation by C.R.A. of the Bougainville copper deposits. As you told the Australian parliament ‘If the project goes ahead and is successful it could make a dramatic contribution to Territory revenues and export earnings in the final year of the plan period’. Economically the Territory went ahead satisfactorily in 1968, with the exception of certain aspects which I shall name below. Agricultural production was generally up, there were very favourable prices for cocoa and copra, new plantings of coconuts, cocoa and tea, particularly in the indigenous sector, were up to target. The oil-palm project in New Britain is ahead of schedule and a second project on a similar scale is in sight. Interest in the development of new light industries is increasing. Mr. Gordon Darling (a Director of B.H.P. and a personal investor in the Territory with a fairly penetrating approach described conditions in November as booming). The exceptions were the forest industry (where, partly due to unfavourable market conditions in Japan which may be temporary, logging firms were in trouble and two large new prospects, Gogol and Vanimo, failed to attract overseas investors), the shortage of land for both rural and industrial development, the feeling on the part of Papuans and New Guineans that the plan is something foreign in which they are not really involved and from which they do not stand to benefit.
This brief and necessarily selective analysis causes me to modify my previous (1968) conclusions only to the extent that the long term nature of the development process could be changed if C.R.A. is successful in Bougainville. The benefits of C.R.A. success to the Territory economy and the size of the Australian taxpayers’ commitment are such as to require very special efforts to avoid these benefits being jeopardised by Bougainville seceding.
I am bound to report that the special effort which in 1968 was needed to ‘make development a national task’ has not been effectively put in train. In part this was due to lack of public relations resources. In part it was due to the fact that the development programme did not receive approval in the House until late in the year. The fact remains that we have not secured Papuan and New Guinean involvement in the success of the programme. Indeed Pangu and its supporters are taking the opposite line, that the programme is ‘only for the whites’. Independently of Pangu opinions, I have come across feelings of resentment at the way trading licences are snapped up by the Chinese and Australian businessmen, at the fact that the bigman of the Highlands is expected to grow tea on a ten acre block and cannot borrow from the Development Bank for his labour costs while his Australian social equals get large blocks and do no physical work themselves, at the lack of indigenous capital and expertise for starting new small scale industries. I have also been struck, in discussions with Local Government Councillors, by the lack of understanding of what development is about; so much so that on several occasions I have had to abandon the idea of explanatory and exhortatory statements to them on the programme. To this has to be added the difficulty of persuading even the better educated people in the wealthier rural areas that a national project such as the Highlands highway or a Court building or a high school is valuable and important even though it is not being constructed in their own district. Finally, one of the essential conditions of an accelerated development programme is the presence of foreigners, for the most part Australians, whose remuneration and standard of living is markedly higher than those of Papuans and New Guineans with whom they are in frequent contact. Not all of these foreigners are sensitive to the feelings of Papuans and New Guineans. Those who work for the Government can claim that their presence is essential. A similar claim can be made for those who invest money in productive activities and those who provide important services, commercial and otherwise. They increase production. They pay their taxes. They provide employment and thus help in the process of transferring Papuans and New Guineans from the subsistence to a cash economy. However, too few of them are conscious of the need to share in the development task in ways which will help disperse the feelings of resentment which their presence and standard of living engender.
These factors suggest that more needs to be done in 1969 and the following years to involve Papuans and New Guineans in the process of economic development generally and in the actual five year plan. The Commonwealth Government has not at any stage set itself against tempering some of the harshness of the World Bank report’s economic doctrine by allocating resources to areas and activities not strictly justifiable in economic terms.4 But more needs to be done. I suggest the following lines of approach.
(a) A substantial increase in the rural development fund and its distribution to districts on a per capita basis with some weighting in favour of the districts with least productive capacity and also those where distances are a problem. Such a measure would enable the Administration to publish its allocation to districts and would help to mitigate the present feeling that some remote districts are neglected. The condition that rural development funds are only available for projects for which funds are also contributed by Local Government Councils would continue to apply.
(b) A greater say for Local Government Councils and District Advisory Committees in rural development projects and other purely district elements in district development programmes.
(c) The creation of an indigenous investment fund for the purpose of investing in profitable Territory enterprises and for establishing indigenous businesses. Consideration has been given to the idea of an investment trust or similar institution, but there has been no solution. A priority needs to be given to this.
(d) Encouragement of public companies to seek indigenous shareholders, and of both public and private companies to put Papuans and New Guineans on their boards of directors. There has been a good deal of talk about this but, so far as I know, no action.
(e) A higher priority to small business training, through the Business Advisory Service and the Co–operative Training College. A Small Business Training Institute is in this year’s works programme for Port Moresby, but work in5 it and also decisions on the Co-operative Training College and on staff for the Business Advisory Service are lagging. Chambers of Commerce need to be brought into the field of small business advice and training.
(f) Localization is as important in the economic sphere as it is in the Public Service. There are real difficulties in this because of the financial consequences of localization to private business in cases where it fails. There is no doubt to my mind of the willingness of private business to promote localization, but there is a deep-seated feeling of caution as to how far the process can safely go at the present stage. Certain large companies, e.g. C.R.A., are setting an example. Others, like some banks, are lagging. But the situation is not easy and blame should not be attributed. The Administration should encourage private business to localize and offer its help in such matters as training.
Continued pressure should be kept on Departments to get on with the carrying out of their part in the development programme, including obtaining approvals in good time for projects on capital works related to the fulfilment of targets. I have given a good deal of thought to the question of whether some special organization, such as a Development Commission, should be created for this purpose. My conclusion is against it. For the most part, the programme falls clearly within duties of individual departments. The relatively few projects which can be isolated from departmental functions are, and for the foreseeable future can be, handled by staff in the Administrator’s Department. Responsibility for keeping up the impetus of the programme should rest with the Administrator, working through the I.D.C.C. for command and co-ordination purposes. A high priority will be given to translating the programme into its district components and to the marshalling and allocation of resources and the co-ordination of departmental activity, at district level. In terms of drawing up district programmes I allocated responsibility to the Economic Adviser,6 and have arranged for his staff to be strengthened accordingly.
So far as political development is concerned, the year 1968 was satisfactory enough. I remain convinced ‘that a slow rate of political development is best suited to the Territory’s present capability’. The reason for this is the manifest lack of an indigenous framework—political, administrative and economic—on which to build. It goes without saying that the construction of that framework is of the utmost importance. The main political factors at work during 1968 tend to indicate that most leaders in the Territory are of the same mind. The most articulate expression of advanced thinking which came to my notice during the year was contained in statements to the June House of Assembly meeting by the Pangu leaders, Messrs. Somare and voutas.7 They introduced only one new concept, that of early Home Rule. By this they meant a state of affairs in which the constitutional rules remain as they are now in the Papua and New Guinea Act but in which party has a majority in the House and therefore in the A.E.C. This would give the majority party a good deal of influence in the government without involving any transfer of basic authority from the Australian Government. Pangu sees this as a step short of internal self-goverment which, in turn, is quite separate and distinct from independence. Pangu did not officially in 1968 (nor did any other organized body of opinion) come out in favour of a publicly announced programme of target dates for forward movement towards a date of self-determination (although its Secretary8 has expressed what I take to be a personal opinion in favour of it, without himself specifying any such dates). Pangu has, however, contested your statement of basic policy that in political development movement should be ‘at the pace wanted by the majority of the people’. Their hope, naturally enough (and it receives support from some advisers and from the ‘Australian’)9 is that the pace can be made in political affairs by the minority elite, an ill-defined term, the scope of which takes in predominantly the younger and better educated element of the community.
The attitude of leaders outside Pangu remains cautious. Many people believe that self-government means the departure of Australians and the running down of Australian aid. The Highlanders fear that early self-government would leave them at the mercy of the better educated coastal people. They do not distinguish between self-government and independence. People like the Ministerial Members are conscious of the amount they have yet to learn before they can confidently master their work. I have found a similar diffidence in the more senior public servants. and even among University students.
At the same time there were developments in 1968, some new, some not, which could lead to pressure before long to force the pace. I identify these as follows:
(a) The election to the House of Assembly in 1968 of a number of younger members who, while feeling their way now, have a background which could cause them to become radical for negative reasons (e.g. anti-European, disillusionment with present system). Amongst them, I include Paulus Arek and Olewale from Papua, Traimya10 from the Highlands, Kaniniba from the Mainland, and Julius Chan from the New Guinea Islands. These men are sensitive to the opinions of the younger educated group. They could well feel that the present system fails to provide them with what they want for their electorates and that they could do better themselves if they had the power.
(b) The fact that Papuan and New Guinean leaders, both in politics and the Public Service, have not become identified personally with major policies. The Administrator’s Executive Council and the Government are still ‘they’ and not ‘we’. The rural leaders are not aware that the resources of the Government are dependent on the taxes which the Territory pays. The Government indeed is often regarded as having a store of abundant wealth to which it is the business of a Member of the House to gain access.
(c) The social tensions due to the forced pace of economic development, in particular the differential wage policy. These tensions are increased by thoughtless actions of insensitive individual expatriates. There is, in these tensions, an element of ‘cargo’ thinking which leads some people to suppose that the ‘whiteskins’ have the wealth and deliberately withold the secret of how to acquire it.
(d) The feelings of dissatisfaction in a number of districts with the development resources allocated to them. I have found these feelings in the majority of districts, including two in the Highlands (Chimbu and Southern Highlands). These feelings tend to strengthen long standing tendencies towards fragmentation in the Territory which are in most districts not far below the surface and which in 1968 erupted in East New Britain and Bougainville.11 Separatist movements are factors which will force the pace of political development.
(e) The tendency of ambitious and dissatisfied persons to exploit feelings of dissatisfaction, indeed to create them, for personal or political gain. This is inevitable. On the whole the House has been free of manifestations of it in the last year, the same applies to the student group. But P.S.A. leadership has had some influence of an inflammatory nature. This may well grow. We must also expect attempts from outside to stir up students—high school and teacher groups.
(f) The ‘anti-Canberra’ feeling in the House of Assembly. This feeling is specifically directed against the Department of External Territories, it is not often directed at yourself as Minister, nor against the Commonwealth Government, nor against Australia. I have drawn your attention to this feeling in separate communications. It was strong in the former House. It has been evident in the present House and in the debate on the Lussick Bill12 and in Pangu statements. It is due to, in part, a failure to recognize the facts that ultimate responsibility for the administration of the Territory remains with the Commonwealth Government and that this involves a severe limitation on the legislative powers of the House of Assembly. Where this limitation becomes evident (as happened during the Lussick Bill debate) the House tends to see its origin in a lack of respect for the House on the part of the Government. It is due in part to feelings of frustration on the part of individual members who cannot obtain decisions which go their way on matters of importance to their electorates. Naturally enough there is a tendency to blame the ultimate source of the decision, and to conclude that things would be better if decisions were made in the Territory. It is important not to over-emphasize this ‘anti-Canberra’ feeling. For a start, I do not think it is held by responsible persons such as Ministerial Members. On the other hand it would be wrong to take it too lightly. In my view the Government and the Administration should exercise great care, in its handling of relations with the House, particularly when there are differences over important matters of policy, to avoid provoking emotional reactions by a lack of sensitivity and flexibility.
In order to contain these pressures and to regulate the pace of political development, we need in my view to involve the people through their leaders to a greater extent, and more visibly, than before in the making and carrying out of major decisions. The measures to be taken which I have in mind need to be consistent with broad Government policy. Because there have been some differences of emphasis in various public statements of policy, I set out below my understanding of it so that if necessary that understanding can be corrected:
(a) The basic policy is self-determination.
(b) In the meantime the Territory is in a transitional stage, on a course towards internal self-government. During this stage it is the Government’s intention progressively to enlarge the measure of self-government. It is doing this by encouraging the elected Members of the House to share in the decision making processes. At a later stage, actual devolution of power is envisaged.
(c) After full internal self-government has been achieved, a further period of time would probably be desirable to provide experience in the exercise of responsibility prior to self-determination.
(d) During the transitional stage final responsibility must remain with the Commonwealth Government. Indeed this situation applies so long as the Commonwealth continues to be the Administering authority.
(e) The rate of progress towards internal self-government and in due course self-determination, as well as the act of self-determination itself, should reflect the views of the majority of the people. The Commonwealth is firmly opposed to setting political target dates. Also, the Commonwealth believes that without substantial economic self-reliance, self-government or independence would be a mockery. Further, the Government objective is balanced development—economic, social and political. The Government believes it is going as fast as possible in the light of the policy of balanced development, and it will not be stampeded into going any faster.
In this analysis, I have pointed to two features of the present transitional stage. The first feature has been variously described by you as:
Territory elected representatives taking an increasing share of responsibility for decisions.
Decisions being shared between the elected representatives of the Territory people and the Commonwealth. This sharing of responsibility for decision making has been qualified by you in respect of the budget. You have emphasized the requirements for the Commonwealth to determine the broad strategy of the budget, and to be in a position to influence and finally control the disposition of the Australian taxpayer’s money. It is only within this context that final responsibility within the Territory for advising the Administration on budget policy and planning rests with the Administrator’s Executive Council. More financial autonomy will be given as the Territory’s capacity to contribute to its own revenues increases.
The second feature is the actual devolution of authority to Ministerial Members individually or collectively to the Administrator’s Executive Council, and in all except reserved fields.
I have set out this background in some detail in order to discuss how greater involvement can be secured without deviating from Government policy.
Given that there is as yet no devolution of decision making authority to persons in the Territory, involvement can only come through effective sharing of decision making authority. The following ways are open:
(a) effective consultation in the process of which the Commonwealth is in fact open to influence by Territory elected representatives;
(b) use of the formal ‘advice’ procedure in the Administrator’s Executive Council when policy matters, such as the budget, are under discussion;
(c) delegation of authority, including financial authority, to Ministerial Members, individually and/or collectively through the A.E.C.
So far as budgetary and financial decisions are concerned the options open for 1969–70 for increasing the Territory share of responsibility are therefore:
(a) more effective consultation on policy matters;
(b) refraining in practice from exercising control in certain areas of detail; and
(c) as a new step, putting the budget discussions in the Administrator’s Executive Council on a more formal basis than before, by seeking the formal advice of the Council.
I have already made (separately) certain suggestions which will open up the possibility of more effective consultation within the agreed programme of budget preparation. It is essential that consultation extend to the budget strategy. I accept the need in present circumstances for the Commonwealth to determine, as distinct from agree to, the broad strategy. But we must avoid a situation in which the strategy appears to have been imposed by the Commonwealth Government.
My second suggestion is that you, as Minister, refrain from exercising direction on matters of detail or relating to the putting into effect of the approved budget strategy. There are many instances in the preparation of a budget where a choice has to be made between approved activities for all of which funds are not available. A priority has to be set between competing departmental demands for recruitment and housing or between competing capital works proposals. I believe a good deal of the responsibility for such choices should be left to the A.E.C. It may in due course be possible to formalize what I have called ‘refraining from the exercise of direction’ into a delegation. I do not see that as a condition or a pressing need. The financial delegations to the A.E.C. already in train will go part of the way, but not all, towards meeting this point.13
I see the third step mentioned above as the most important. So far budget discussions have been brought before the A.E.C. as matter for consultation rather than advice. This has been deliberate. It has allowed for greater informality of discussion. It has avoided a situation14 which a disagreement would have to be formally reported to the House of Assembly. The disadvantage has been that this practice has not fully and formally engaged the elected members of the Council. It is another thing to say that the Administration is acting with the formal advice of the A.E.C. The members of the Council would be bound by that advice and would therefore have to accept publicly a greater responsibility for it than in the past. This would be (and would be so regarded) a step towards greater involvement of the A.E.C. in budget decisions. On the other hand, the danger of a confrontation with the House in the event of the Commonwealth Government not accepting the A.E.C.’s advice would be more serious.
Involvement can come in the non-financial area in much the same way as in the financial area, by greater consultation, and by the greater recourse to formal advice from the A.E.C.
There has probably not been enough time since the new A.E.C. came into being to develop the degree of consultation which would influence the involvement of elected members in the Government’s policies. Not only the 1968–69 budget but also the five year development programme were well advanced before they could be put to the Council. Other decisions affecting the Territory were taken before the A.E.C. was consulted, notably the decisions on Asian investment15 and on longline tuna fishing. On the other hand, it is fair to say that there was full consultation on the Lussick Bill and on such important policy matters as economic rentals and amending land legislation.16 The disposition to consult is evident. There is no reason why the process should not continue on a bigger scale. A particular area where this could be done is legislation. I have separately recommended through the Department that we should move to the position where all legislation be to17 go to the A.E.C. both in regard to policy issues and in regard to the final drafting.
It is problematical whether consultation is sufficient, even if developed more fully, to secure the involvement which I have suggested is necessary. One of the troubles is that consultation with the A.E.C. is confidential, and the House and the public are not told what views are expressed by Ministerial Members nor are they able to judge whether the Commonwealth Government is ever influenced by A.E.C. views. It is for consideration whether at some time in the future you should include in a speech or statement a passage about this and express the Government’s intention, as a normal rule:
not to take any major decision without having before it the views of the A.E.C., and
to ‘enter into discussions with A.E.C.’ before taking a decision that differs from its views.
There are other ways by which the measure of internal self-government can be progressively enlarged during the transitional period and before the process of transfer of authority begins. They mostly lie within the scope of your own authority under Section 25 of the Papua and New Guinea Act.18 One which I now recommend is the appointment of two more Assistant Ministerial Members. A suitable time to do this would be mid-1969, after the first effective year of the present House. It would be useful if you would agree to announce now your intention of doing this so that19 Ministerial Nominations Committee could be called together in good time. Later in 1969 it would be possible to review the relative authority of Ministerial Members and Departmental Heads with a view to adjustment in favour of the former.
But my own disposition is to recommend that more attention be paid in the present circumstances to the collective responsibility of elected members through the A.E.C. rather than to their individual responsibilities.
Greater involvement carries with it some risks, in particular the risk of upsetting what you may feel to be the correct balance between sharing the decision making process and maintaining the Commonwealth’s ultimate responsibility. The area in which this risk is the greatest is that of the relations between the Government and the Administration on the one hand and the House of Assembly on the other. I expressed my concern, which I reported on the fate of the Lussick Bill in my letter to you LH.2571 of 2nd December20 at the possibility of frequent confrontations between the Government and the House. 1 felt then, and still feel, that the Government should be flexible in its reactions to even some of the more hasty majority decisions of the House. In your reply you stressed the necessity for the Government’s basic policy to prevail and for official members to play their part in ensuring that this happens.21
The point that with all respect I feel bound to emphasize is this. There is no question of the legal and constitutional authority of the Commonwealth which in the last resort can be exercised through the reserve powers in the Papua and New Guinea Act. Nor is there any question of the duty of official members in such circumstances. But a great deal depends on the methods used by the Government to get its way in the admittedly difficult situation where in the House the elected Members are in a vast majority. The ideal to be aimed at is that because of prior consultation the elected members find themselves willingly supporting legislation to give effect to basic policy. Indeed this is the only set of circumstances in which the Government’s policies will be carried out successfully. Imposed policies will not succeed. This is why, in this letter, I have given such emphasis to the need for involving elected Members in what the Government is doing. To adopt a take it or leave it attitude on important matters in the House, will, to my mind, do more than anything else to bring about premature movement towards self-government for emotional reasons.
I shall be replying in more detail to your letter, but I think it essential to make this general point now. There has seemed to me to be a danger of the balance between sharing in decision making and retaining the Commonwealth responsibility tilting too much towards the Commonwealth with repercussions that will adversely affect the putting into effect the Government’s general policy.22
I have written so far of involvement of elected members of the House. The need goes further than this. Local Government Councils are already being given more responsibility and this process should continue. I propose also to give a higher priority to introducing urban local government. This is already the subject of exchanges between the Administration and the Department. Finally, a new programme of political education is being undertaken.
Involvement is not the only thing which will regulate the pace of political development. It will be affected by our success or otherwise in maintaining national unity. Because this is the subject of current exchanges with the Department I do not pursue it further in this letter, other than to affirm that it will have a high priority in the attention of the Administration.
I turn back now to two other points which I singled out as characteristic of the past year. One of these is the question of social tensions. Looking back, I believe that there was less stress in 1968 than in the two previous years. When I left the Territory for Australia, not only the intelligence machine but also private contacts who normally have a good feedback from indigenes, told me that things were quiet. Within the P.S.A. which tends to stir up tension through its vicious and vituperative methods, there has been dissatisfaction and this has manifested itself in sharp oral attacks on Members. Generally this has not taken a racial tone. But the differential wage system is likely to remain a source of friction, or worse, until enough indigenes are occupying top positions to make it obvious that we are not, as it were, keeping back cargo from the indigenes. If the P.S.C. 23 carry out their announced intention of putting up a new wage claim for local officers across the board in 1968, we must expect tension to rise, at any rate in the urban centres. Measures to contest this are localization; greater care on the part of government and private enterprise in the selection of employees to come to the Territory; more selectivity in the issue of permits to persons who may come to the Territory with the deliberate intention of stirring trouble (for example, among students),24 and finally, better communication between the Administration and the people. I have already spoken to you of the advantages I see in the use of psychological testing as a selection aid, particularly for field staff, and I hope you will support this. There are some weaknesses in the procedures for the issue of permits and I shall be taking these up separately with the Department. Better communication has been a major concern since my arrival in the Territory. Much remains to be done before the Administration’s machinery for communicating its views and for determining how best to do this are functioning effectively. This requires, and will receive, priority attention.
The second point is the dissatisfaction of people in districts other than the Central District with their share of resources and also with the treatment they receive from Port Moresby. I do not think the feeling is any stronger than in previous years, but it exists and affects peoples’ thinking. Although it has for the first time manifested itself in the form of organized separatist or independence movements, there are indications that these feelings of dissatisfaction may crystallize in demands for some form of statehood. These demands could become more vocal in 1969.
In my opinion this kind of development should not affect the important requirement of which I wrote a year ago, when I said:
‘the thing which clearly emerges from a study of economic development is the need for firm government at the centre. This is required in order to put the necessary economic policies into effect. It is also required for another reason, namely to forestall a tendency towards fragmentation’.
Acting on the basis of this statement, I have discouraged the development of identifiable administrative or economic regions and also the amalgamation of Local Government Councils into bodies which could become embryonic state governments. It has been pointed out, by, for example, the Committee on Administrative Procedures, that administration might be more effective if regions were created and if powers were delegated to regional officers. Expert opinions differ on this. The administrative expert in the U.N.D.P. Transport Survey has, for instance, told me that regional works engineers are in many cases a delaying factor in communication between the central government and the district. I see advantage in departments having in their head offices inspectors with regional-type responsibilities and interests. But the broad political reasons for a strong central government when the task is to develop a fragmented Territory of this kind with inadequate resources are to my mind overwhelming. As a corollary, I propose to retain the district as the basic administrative unit. Some rationalization may in due course be needed of the different populations within their present boundaries, but I do not propose to follow the course of amalgamation.
Since pressure for some further local say in district affairs is likely to grow in the future, and because excessive centralization is administratively unsound, I have been seeking ways in which more authority can be delegated to districts. You have approved increased financial delegations to District Commissioners. I have separately suggested a substantial increase in Rural Development Funds to be available to districts. I have arranged for Local Government Councils and D.A.C.s25 to have the maximum consultation before the D.C.C.s25 and that District Commissioners make recommendations on the disposal of these funds. A further avenue for increased delegations is departmental functions, notably the disposal of land. I propose to look into the possibility of this.
I am hopeful that this increased delegation of authority, together with good communication can contain the pressure for statehood. If it does not, or if a worse case occurs, such as a serious move on the part ofBougainville to separate off and become independent, then the Government ought to consider the economic consequences for the future of the remainder of the Territory before permitting it.
I now tum to the social aspects of the Administration’s task in the Territory. It is part of the policy of balanced development that resources be available for social development. The problem, when we lack sufficient resources for economic development in any event, is to determine which areas in the social services groups should get priority, and what total resources they should get. The World Bank Report provided certain guidelines. Education is vital because it produces the trained and qualified manpower without which development could not occur. Funds for Health can be limited. Up till now funds have not been provided for any expansion of welfare, community development and adult education activities, which are on a rudimentary scale. Recent exchanges between the Territory and the Department have covered such matters as low-cost housing, integrated housing, urbanisation and the need to provide opportunities for displaced boys and girls whose schooling and age do not readily qualify them for jobs. The new Department of Social Development and Home Affairs will provide a focus for the further study of these matters. A strong claim for further resources is being made by the legal profession and in the interests of future stability I believe that we need to review this. Another area where I believe insufficient resources have been available is that of the preservation and study of indigenous culture, history, fauna and flora. I have placed certain proposals before you to that end.26 I regret that the reaction has so far been unfavourable. I propose to pursue this matter further in correspondence with you, because our good name as an Administering Authority will much depend on our efforts in this field.
The story so far is largely one of wholesale pillage of the cultural property of the Territory in the interests of a few traders who have bought valuable objects for pitifully low prices and sold them overseas for exceedingly large profits.
I referred in my 1968 letter to relations between the Administration and the Department and also the need for greater delegation to the Administration. I do not in this letter propose to address myself in detail to these matters. But I am bound to report that the working relationship between the two organizations which serve you were not as smooth in 1968 as they were in 1967. It is no less important for officers in the field than it is for elected Members of the House to feel that their views are respected and their knowledge made use of. There has been amongst senior officers a feeling of frustration which is not related to Government policy but to the delays in obtaining decisions on implementation, particularly, but not only, in the New Works area,27 to what I term a disposition on the part of departmental officers to intervene in administrative matters, and also to a tendency on the part of departmental officers to insist on introducing new (and often valuable) concepts into projects already in train, with resultant delays. I have reported to you the state of feeling of Departmental Heads in respect of their claim for reclassification. I have been concerned at the long time this has taken to reach finality, even though the outstanding points of principle were decided by you in October, 1968. Had the attack been a joint one (as happened when in mid-1968 the matter was given a high priority by the Department) the paperwork would have long ago been completed. In the New Works field the Administration has not been able to achieve its targets. Again this situation has been due to delays in getting decisions. Some of this has been the fault of poor preparation, but l believe that if there was a sense of urgency about getting things done and a better understanding of administrative method and more joint attacks then the record would have been better. As I have said privately to you, the Government will be judged very much by its success in getting things on the ground. In many cases the costs of delayed decisions are greater than the amounts which might have been saved by marginally better schemes. This is missing the wood for the trees.28
As you said in your original letter of appointment to me,29 the possibility of tension arising when two sets of officers are closely concerned with overlapping aspects of the same tasks is bound to exist. This is true. The important thing is not to let these things affect the quality of work done for the Government. It is also important to take what steps are possible to ensure the smoothest possible working relationship.
You may be sure that I and other senior members of the Administration will do our best to this end.
I am sending a copy of this letter to the Secretary.
[NAA: A452, 1967/7354]
Conclusion of the Lussick episode
After the Lussick bill was passed by the House,1 the Administration reserved the legislation for consideration by the Governor-General2 and a Government-sponsored inquiry into the arbitration system was made by Professor H.A. Turner of Cambridge University and the Commonwealth Public Service Arbitrator, E.A.C. Chambers. Their report was presented to the Government in late January. Its recommendations were accepted by Barnes and the AEC,3 after which Territories put considerable effort into ensuring that the tactics used to introduce legislative changes would be both effective and of political benefit to the Government. Salient here was the question of who would introduce the changes and ‘how we are to get rid of the Lussick bill’.4 Warwick Smith had been worried about ‘Lussick being built up’ if he were to introduce the amendments5 —and thought was given to having the Governor-General recommend amendments, though Ballard believed that ‘very little of the original Lussick Bill would stand and the Draftsman would be likely to take the view that … this is contrary to the recommended amendments procedure’.6 It was decided in mid-February that Johnson would introduce a new bill,7 but the problem of how to dispose of the Lussick bill remained unresolved. An involved debate on legal technicalities developed. Among the options tabled was that of naming Lussick’s bill in a section of the new bill that would list ordinances being repealed—a move thought by Henderson and Johnson to have ‘political advantages’.8 This was dismissed as legal nonsense by an Attorney-General’s official who said that ‘you can put 2+ 2=5 into a law if you want to make goats of yourselves’9. But DOET went ahead because Hay thought ‘the inclusion in the bill of some provision for repeal would deprive [a later withholding of assent to the Lussick bill] of any political significance’—even though the provision ‘is thought to be of no legal effect’, it ‘amounts to an expression of intention on behalf of the House’.10
On 11 March, Johnson introduced the new arbitration bill which established a tribunal to deal with arbitration claims.11 The tribunal would ask opposing parties to negotiate bilaterally, but if this failed it would move to formal hearings. It also had the power to establish boards of inquiry on ‘issues of general public importance’. The bill contained no provision for appeal.
During debate, Lussick said
he hoped Konedobu and Canberra had learned some lessons. Canberra should see elected members and [the] independent group as being responsible and acting in [the] best interest of [the] people. There was [a] need for more flexibility.12
Lussick introduced a number of minor amendments which added to the tribunal assistant non-voting members nominated by the Administrator—two from the Public Service Board and two from a list submitted by the public service organisations.13 The assistant members would be indigenes who would thereby gain experience of the arbitration system. The amendments were accepted by the Administration14 and the bill was duly passed, after which Hay explained to Territories that ‘support from [the] majority of elected members was largely due to [the] Administration’s willingness to co-operate and if Lussick’s amendments had not been agreed to the bill would have been lost’.15
1 Document 155.
2 Ellipsis in the original.
3 See Document 246.
4 See introduction for discussion of the report.
5 This should presumably read, ‘on’.
6 A. W. McCasker.
7 See Document 200.
8 Maori Kiki.
9 That is, the Australian newspaper.
10 Traimya Kambipi, MHA, Kompiam–Baiyer open electorate.
11 See, for example, Documents 223 (footnote 1), 230, 234 and 247.
12 See editorial note ‘Tensions in the House: the Chatterton and Lussick bills’.
13 See editorial note ‘Administrative delegations and the role of Assistant Administrators’.
14 The word ‘in’ appears to be missing here.
15 See Documents 211 and 232.
16 See Document 226.
17 Presumably, the words ‘be to’ should be omitted.
18 See editorial note ‘Changes to the Papua and New Guinea Act’.
19 The word ‘the’ seems to be missing here.
20 See editorial note ‘Tensions in the House: the Chatterton and Lussick bills’.
21 Final not found. An undated draft is similar in substance to Document 253. On Hay’s contention that confrontation should not develop, the draft retorted: ‘There may be some areas where this attitude would apply but definitely not in basic policy. The Lussick Bill involves basic Government policy and there can be no compromise on the proposals put forward by the House’ (NAA: A452, 1969/152). For a draft of 17 December 1969 on Warwick Smith’s personal files, see NAA: NA 1983/239, 48/5.
22 Hay has commented on the differences he had with Barnes and Warwick Smith over the House of Assembly: ‘[In their view i]t was better—as a matter of tactics—for the Administration to stand firm and suffer defeat in the House … and then rely on the powers of the Commonwealth Government to amend or reject [legislation] … This was a pretty fundamental difference of opinion and I don’t think they ever moved from it, nor did I … official members really had no give on … tactics. It seemed to me that there was a … feeling on the part of people in the Department (and I have heard one or two of them say it) that the House of Assembly really had to be thumbed down occasionally just to show who was who … I was forced to give these instructions to the official members who … were very reluctant because they often felt that a little bit of give and take could have got the great bulk of the Government’s policy through, with a little loss around the edges, but without any ill will that goes with trying to discipline, as it were, a body of adults who were very independently minded and very vociferous’ (Hay interview, 1973–4, NLA: TRC 121/65, 7:1/11–13).
23 This should perhaps read ‘P.S.A’.
24 See Document 254.
25 District Co-ordinating Committees; see footnote 4, Document 72.
26 See Document 254.
27 See editorial note ‘Administrative delegations and the role of Assistant Administrators’.
28 Hay has remarked that ‘there was a considerable degree of frustration on the part of senior officers in Port Moresby … It arose … from the practice in the Department of re–doing all works proposals virtually from scratch within the various branches of the Department. This was a time-consuming operation. It was justified on the basis that it was the Department’s job to pronounce on the proposals which came in from the Administration and separately to advise the Minister on them. I … never agreed with this. I had always believed that the most expeditious way of handling these proposals was for a joint appraisal [see Document 144] … I had never agreed that the Minister ought to interpret his … responsibility to Parliament as requiring him to take decisions over all the area of Government. I held … that a Minister was quite entitled, if he delegated, to indicate in some cases something less than 100 per cent support of administrative actions taken under the delegation—if there was strong criticism of them. The Minister, however, took a very upright line. He would stick up for everything that had been done by his staff. This was consistent with his interpretation of his responsibility to Parliament’ (Hay interview, 1973–4, NLA: TRC 121/65, 7: 1/18–21).
29 Document 53.
1 See editorial note ‘Tensions in the House: the Chatterton and Lussick bills’; also, Documents 253 and 259.
2 Memorandum, Administration (Henderson) to DOET, 10 January 1969, NAA: A452, 1968/4967.
3 Minute, Ballard to Warwick Smith, 30 January 1969, and telex 871, Hay to DOET, 7 February 1969, ibid.
4 Telex 2038, DOET to Somers and Hay, 14 February 1969, ibid.
5 Minute, Besley to Ballard, 21 January 1969, ibid.
6 Minute, Ballard to Warwick Smith, 31 January 1969, ibid.
7 Telex 2359, Somers to Warwick Smith, 17 February 1969, ibid.
8 Telex 1258, Warwick Smith to Besley, 20 February 1969, ibid.
9 Minute, Kerr to Ballard, 20 February 1969, ibid. Attorney-General’s argued that the Lussick bill could not be put into the schedule as it was not yet law (Joe. cit.)—and also stated that the PNG Act demanded that reserved bills go to the Governor-General for assent or rejection (telex K235/2464, Ballard to Watkins, 27 February 1969, ibid.).
10 loc. cit.
11 House of Assembly debates, 11 March 1969, NLA: Nq 328.952 PAP, pp. 992–5.
12 Unnumbered telex, 11 March 1969, Administration to DOET, NAA: A452, 1968/4967.
13 Telex 1783, Administration to DOET, 12 March 1969, ibid., and House of Assembly debates , 11 March 1969, NLA: Nq 328.952 PAP, pp. 996–7.
14 Telex 1783, Administration to DOET, 12 March 1969, NAA: A452, 1968/4967.
15 Telex 1812, Hay to DOET, 12 March 1969, ibid.