Canberra, 24 July 1969
I have read with interest your letter of 28th February which sets out your views on certain broad policy issues. 1
Before commenting on your letter I want to say that I regard very highly the work that the Administration is doing. Over the period there have been some quite serious circumstances of tension and so far the storm has been ridden. This progress devolves great credit to you and your officers for judgment and attitudes shown on these occasions.
As to the views set out in your letter, generally in the broad, 1 am in agreement but there are some points on which I have a different view.
Since these comments are given in a broad sense they are intended to contribute towards an area of understanding rather than to be taken as constituting a formal expression of Ministerial approval. Particular proposals will, of course, be put forward through the normal channels in the ordinary way. In the proper exercise of co-operation and understanding in the implementation of Commonwealth policies there is no alternative.
You rightly stress the importance of securing indigenous involvement in our development programme and since you wrote your letter I believe that, at least, the problem has been emphasised and a first measure to a solution has been the policy to stimulate co-operatives. Training schemes need to be devised and localisation needs to be pressed in the private sector.
‘The advancement of the local people’ has figured prominently in official statements regarding the policy of accelerated economic development. It is the fundamental objective of the present economic development programme. So far as the programme succeeds in accelerating economic development, it will produce or at least increase the problem of native involvement. You might consider whether or not the momentum of the economic development programme should be a charge on the Economic Adviser with formal responsibility for native involvement in the programme. You may care to furnish your views on the above.
I place great importance on the role of the Administrator’s Executive Council. I was impressed with the contribution made by individual members of the Council when I met them for a general discussion on my last visit to the Territory. It is no simple matter to involve these people in the details of departmental responsibility but in the broader sense of Council deliberation and discussion I cannot help but feel that they would be most useful and the more that this involvement is encouraged the more they will feel part of the governmental system. I believe that the proper functioning of the A.E.C. holds the key to the success of the parliamentary system in Papua and New Guinea.
I accept that the factors you list may work ‘to force the pace’ of political development. I will be receptive to any specific proposals you may put forward for more effective consultation with Ministerial members, individually or in the Administrator’s Executive Council on policy matters. I leave it to your discretion whether you obtain formal A.E.C. advice on the 1969/70 Estimates or not.
I do not agree with your statement, as drafted, that we must avoid a situation in which the budget strategy appears to have been imposed by the Commonwealth Government. I prefer to regard the strategy as settled already by the House of Assembly and the Commonwealth Government in the Economic Development Programme and the House of Assembly’s endorsement of it. I see no reason so far as Ministerial Members are concerned why there should be any ‘confrontation’ over budget matters. I accept that any proposed significant variation from the estimates endorsed by the A.E.C. should be referred back to the A.E.C. before being finally approved. Your suggestion that the Minister not exercise direction on certain matters of detail, however, seems to me to involve greater questions of responsibilities that2 your letter suggests. In any case I am not prepared to see a drift into a situation in which the Commonwealth provides two-thirds of funds for the government of the Territory and does not control expenditure.
The Department will be discussing with the Administration the extent to which Ministerial Members are now exercising their responsibility in the Departments with a view to a joint report about it. This is now a more urgent matter since a constitutional committee has been set up.
l support your views, particularly on the importance of involving Local Government Councils in more responsibility. I have always felt that this is the most effective training area for democratic procedures. In a sense, the preparatory school from which the most useful participants flow on to the grammar school of national parliamentary responsibility.
I congratulate you on your decision to hold A.E.C. meetings in various large centres. People in these areas will tend to feel part of the Government system.
I support your view that the permit system should be reviewed. We are allowing too many undesirables into the Territory.
The functioning of the House of Assembly appears to be stabilising but legislation in the House appears to be dealt with far too quickly and I believe that greater effort should be made to remedy this situation.
I have had complaints from elected members that sitting hours during daylight hours should be extended in order to enable more parliamentary business to be completed within the present period of sessions.
The matter of delegations has been dealt with by the Secretary3 and other matters raised in your letter, I believe, could be the subject of further correspondence.
[NAA: A452, 1967/7354]
Administrative delegations and the role of Assistant Administrators: continued
debate
Although agreement on the principles guiding administrative delegations was apparently reached between Territories and the Administration during 1968,1 disagreement over practical aspects continued into early 1969. There also remained tensions over the status of Assistant Administrators.
Some progress was made in May. Stressing the need ‘to bring [the matter] to finality’, Warwick Smith proposed that Assistant Administrators have a ‘role in relation to the Administrator … somewhat akin to that of a Deputy Secretary in a Commonwealth Department’.2 They would ‘not be vested with either specific or general delegations’ and they would ‘not have any statutory relationship with Departmental Heads or Ministerial Members’-but they would ‘be called upon to act in lieu of the Administrator as necessary, and bring to finality any subject within the full range of matters coming within the competence of the Administrator’. Their duty statement would be ‘to advise and assist the Administrator on more important policy issues’; ‘to relieve the Administrator of many representational responsibilities’; ‘subject to further developments, to continue their present roles in the House of Assembly’; and ‘as directed, to undertake specific assignments on behalf of the Administrator’. Expanding on the relationship between Assistant Administrators and Ministerial Members, the Secretary suggested that ‘Whilst Ministerial Members would not be subject to decisions or directions by any officer of the Administration other than the Administrator, the Assistant Administrators would be expected … to advise Ministerial Members and otherwise to help them and contribute to the smooth workings of arrangements under Section 25 of the Papua and New Guinea Act’. 3
Hay telexed in reply that there was in his view ‘a wide area of agreement which will enable us to present to the Minister a generalised duty statement’, and he recommended that the position be re-named ‘Deputy Administrator’.4 At the same time, he noted that there remained ‘areas of disagreement’, namely ‘relations between Assistant Administrators and Ministerial Members, and your concept of a roving deputy’. ‘The second of these’, he maintained, ‘involves the way I perform my own duties and I must insist that this be a matter for discussion by me with the Minister’. In June, Barnes approved Warwick Smith’s duty statement, while being informed that there ‘is some disagreement on how this arrangement is to work in practice’. 5
Similar uncertainty lingered over financial and works authorisations. In a letter of June to Barnes, Hay had accused the Department of seeking to delay the implementation of greater delegations to the Administration, especially in regard to the authorisations agreed in July 1968.6 Privately, he felt he had been
held to ransom by George Warwick Smith who, as a kind of quid pro quo, wanted to get my agreement to the transfer of the works programming section from the direct control of Les Johnson … into the Treasury. I think this was a direct criticism of the way works programming had been handled by Les Johnson … I certainly took the view that while there were faults with the administration of the program we were better off with the experience which his supervision had provided and so I resisted the transfer of this function to the Treasury, although I didn’t disagree with it in principle7
Warwick Smith reacted to Hay’s letter with indignation. In a counter-representation to Barnes, he commented acerbically that
it seems the Administrator does not accept that he is purely the agent of the Minister in the Territory. His messages frequently do not seek the ‘approval’ of the Minister—they often say ‘please advise the Minister that I intend to do this’. He believes he has a right to approve much larger sums of money, and thus the Department has no proper role in these matters.8
In explaining the delay, Warwick Smith wrote of
a continued consideration in the Department (including getting an advising from Attorney-General’s) of the difference of view on whether Assistant Administrators should have greater delegations than Ministerial Members. The Department has stood by the constitutional position that only the Administrator can direct Ministerial Members. The Attorney-General’s Department holds this view. It follows from the arrangements approved under the … Act that delegations to Ministerial Members must not be less than delegations to any officials other than the Administrator.
Rejecting Hay’s wish to avoid (‘in the foreseeable future’) the transfer of works programming from the Administrator’s Department to the Territory’s Treasury, Warwick Smith argued that such a transfer was necessary for ‘maximum effective control’, and he pointed to the ‘Administration’s past failure to conform with procedures laid down’. He recommended that the delegations agreed in July 1968 be effected ‘as soon as the Works Programming Unit is located in the … Treasury, and [that] they are to take effect on the basis that no official of the Administration, other than the Administrator himself, is to hold delegations greater than the relevant delegations held by Ministerial Members; and that the Minister wishes to know where the Administrator proposes final responsibility within the Administration should be in future for works programming’. Barnes approved the recommendation.9
Partial resolution of these tensions was achieved in November.10 After a meeting in Canberra with Hay, 11 it was announced that Ministerial Members would henceforth hold financial delegations equal to departmental heads, excepting the Treasurer. 12 The same principle would apply to statutory delegations, in regard to which Ministerial Members would exercise authority in ‘the more important cases’. These changes were said to ‘give effect to the principle that a Ministerial Member will exercise responsibility in respect of the functions of his office jointly with the departmental head’. The AEC was simultaneously given authority to ‘admit to a design list proposals for new works where the estimated cost does not exceed $200,000’. 13
Disagreement over the Works Programming Unit, the role of Deputy Administrators and greater financial delegations does not appear to have been folly resolved by the end of 1969.14
1 Document 259. In mid-June, Warwick Smith made a draft note of ‘Points that might be made by [the] Minister’ in reply to Hay. Inter alia, he wrote: ‘No general endorsement: specific policy proposals where required … Constitutional Development—[i] MM’s authority in the Departments [ii] stand MM’s and AEC up to own decisions … Responsibility for surveillance of the [development program] rests with [the] Economic Adviser. House of Assembly—don’t encourage the expatriates. Reaffirm that pace and nature of p.d. [presumably, political development] are for the people themselves to decide— bulk of the people. Why not have a full time political spokesman and S.O.M. [possibly, Senior Official Member] as Admr.? … [Concerning the] Words … “at a later stage, actual devolution of power is envisaged”. The Administrator is there to respond to the wishes of the Minister (see July ‘66 1etter [Document 53]) … The Government places great stress on greater participation by the Territory reps in the government of the Territory. [Regarding Hay’s suggestion on increasing involvement in budgetary and financial decisions] Hay didn’t want MM in Budget working party … “my second suggestion”—spell it out, but don’t think officials can rule the roost. [On paragraph beginning “I see the third”]—this is up to Hay as Administrator—formal advice it should be[;] danger of compensation [should probably read “confrontation”] is not as great as danger of puppets [;] set up legislation committee. Programme of political education and of accelerated economic development indicate the difficulties and dangers of hastening the process of modernisation or development: both these activities are paternalistic whereas the aim is self-help and greater self-reliance … What are the basic issues? Land; Social Development; Participation; Public Service Localisation. When the Commonwealth seminar in Canberra was discussed officials were horror-struck. Nonsense.’ (20 June 1969, NAA: NA1983/239, 49/8.) The last sentence was apparently a reference to the incident described in footnote 36, editorial note ‘Tensions in the House: the Chatterton and Lussick bills’. A resultant draft letter from Barnes to Hay—seemingly written by Warwick Smith or a senior colleague—was much longer than the final version and reads in part: ‘I note your view that we have not secured Papua New Guinea involvement in the success of the economic development programme. This has to be expected in the nature of things. As you recognise, it is not wholly an economic issue. I would be glad if the Administration would forward through normal channels proposals for steps designed to increase actual and practical involvement of native people in the programme as well as to reduce the emotional tensions inherent in the situation. [Regarding advancement of local people] much can be achieved if the scope of the Ministerial Membership system is fully exploited. The [AEC] is a useful vehicle for exercise of collective responsibilities. There is, however, little indication in the papers coming to me of any initiative or positive approach by the Council, and there is always the danger of the Council being too ready to go along with Administration proposals rather than its members thinking out their own positions. Collective responsibility in the A.E.C. may be helpful, but it is not in my view enough. There must be ample exercise of [MM] authority in the respective departments if the intentions of the system are to be carried out, if the system is not to be discredited, and if necessary pressures for further moves towards self-government (arising out of an ineffective [MM] system) are to be avoided … the attitude of Administration officers towards the Commonwealth Government and the Department seems to show a lack of understanding. All officers of the … Administration are public servants responsible to the Commonwealth Government … through the Administration to the Minister … you refer to my having stressed the necessity for the Government’s basic policy to prevail … I quite agree with you that much depends on the way things are handled—this applies perhaps even more to the views and attitudes of the official members in Port Moresby than to decisions in Canberra’. Warwick Smith also suggested that the ‘efficacy’ of the Administration might be helped by appointment of ‘a single official to be responsible to you and through you to me on all House … and political matters’. The Secretary remarked that another official could be placed ‘under the Administration to control and direct the Administrator’—though he likely intended to communicate the reverse (24 June 1969, NAA: NA1983/239, 49/6).
2 Presumably, this should read ‘than’.
3 See editorial note ‘Administrative delegations and the role of Assistant Administrators: continued debate’.
1 See editorial note ‘Administrative delegations and the role of Assistant Administrators’.
2 Letter, Warwick Smith to Hay, 5 May 1969, NAA: A452, 1969/142.
3 See Document 197.
4 Telex 3665, Hay to Warwick Smith, 21 May 1969, NAA: A452, 1969/142.
5 Submission, Warwick Smith to Barnes, 12 June 1969, ibid.
6 See submission, Warwick Smith to Barnes, 15 July 1969, ibid.
7 Hay interview, 1973-4, NLA: TRC 121/65, 7:1/22.
8 Submission, Warwick Smith to Barnes, 15 July 1969, NAA: A452, 1969/142. On 16 July, Warwick Smith put a note to Ballard: ‘I think we ought to … give the Administrator another dissertation on the political situation, replying in effect to the constitutional/political aspects of his February report [Document 259]’ (NAA: NA1983/239, 49/6).
9 Shortly after communicating Barnes’ views on financial and works authorisations, Warwick Smith wrote in a separate letter to Hay: ‘The Minister also asked me to write to you on the more general question of the relationship of officers of the Administration to the Commonwealth Government. He is not sure all officers of the Administration understand this relationship, the essence of which is that they are all public servants, responsible through their Departments and the Administrator to the Minister for External Territories to the Commonwealth Government. They have no independent authority of any kind. In this they are in exactly the same position as a public servant in Canberra or an officer of a Commonwealth Department operating directly in the Territory. The Minister also suggests it would perhaps help relationships, in any cases where the situation is not fully understood, if you could get the people concerned to understand that in advising the Minister regarding submissions by the Administration the Department is carrying out its own constitutional and statutory role. In the Minister’s view the Administration and the Department are two arms of the Government which must work as a team and which can in no circumstances be regarded as competitors’ (29 July 1969, NAA: A452, 1968/2309).
10 On 5 November, Warwick Smith had sent a note to Ballard: ‘Talk to me about [delegations] without fail today. I want to take the question of delegations quite objectively and very finmly’ (NAA: NA 1983/239, 49/6).
11 See telex 10737, DOET to Administration, 13 November 1969, NAA: A452, 1969/4912.
12 Administration press release, 18 November 1969, NAA: A452, 1969/142, and cablegram 1246, DEA to UNNY, 20 November 1969, NAA: A452, 1969/4912.
13 Various conditions were attached to the new delegations including, inter alia, that MM approvals for expenditure would be ‘in accordance with approved policy and functions … and the exercise of due economy’; the AEC’s authority had similar strictures.
14 See letters, Warwick Smith to Hay, 4 November 1969, NAA: A452, 1969/142.