Guide 3 to NSW State Archives relating to Responsible Government - OCR - Flipbook - Page 206
A Guide to New South Wales State Archives relating to Responsible Government
Believing that a referendum was necessary before the Bills could become law, the
Legislative Council passed both Bills on 10 December 1930. Lang then announced his
intention of presenting the Bills for Royal assent without a referendum.15 Consequently,
A K Trethowan and other Members of the Legislative Council commenced proceedings in
the Supreme Court of New South Wales seeking injunctions to restrain the presentation
of the Bills for Royal assent. Following the granting of the injunctions, the validity of
section 7A was upheld by the Full Court of the Supreme Court, the High Court of
Australia and, ultimately in 1932, by the Privy Council.
During the period before the fate of the 1930 Bills was determined by the courts, Premier
Lang continued to push for further appointments to the Council. In November 1931 a
further 25 Members were appointed, two of whom were women. By 1932 the
membership of the Council had increased to 126.16
Lang was dismissed from the Premiership, however, due to a financial conflict with the
Commonwealth Government which had arisen out of his refusal to pay interest on the
public debt owed by the State. The Commonwealth Coalition Government paid the
bondholders and then passed the Financial Agreement Enforcement Act to recoup itself
by appropriating the funds of the New South Wales Government (requiring certain State
taxes to be paid directly to the Commonwealth and requiring the banks to transfer State
funds held by them to the Commonwealth). When the High Court upheld the validity of
this Act, Lang ordered all State funds to be withdrawn from the banks (to prevent them
from handing the funds over to the Commonwealth) and all State revenue to be paid
directly in cash to the Treasury.
Two Treasury circulars were issued by the Lang Government, The first of 12 April 1932
directed New South Wales public servants to hold funds and insist on cash or bearer
cheque payments. The second of 10 May 1932 suggested that, as the Commonwealth
apparently had power to seize New South Wale Government funds, the State would have
no money for salary payments and that the Commonwealth had or thought it had no
obligation to pay New South Wales public servants.
Governor Game thought the circular of 10 May contrary to a 6 May 1932 Proclamation
issued by the Commonwealth Government ordering New South Wales public servants to
pay State receipts into the Commonwealth Bank to the credit of the Commonwealth and
asked Lang to either show it was legal or withdraw it. Game also hinted he may ask for
Lang's resignation or dismiss him. On 13 May, offering no advice as to its legality, Lang
replied to the Governor that the circular represented a Cabinet decision and would not be
withdrawn. Lang declined to resign and was dismissed by Game on legal advice that the
circular was illegal and that Lang was breaking Commonwealth law.
The Governor swore in the Stevens Government before proroguing Parliament. At the
ensuing election the second Lang Government was replaced by that of Bertram Stevens.
Labor's numbers in the Legislative Assembly were reduced from 55 to 24 seats; the
coalition had 66.
In September 1932 legislation was introduced to reform the constitution and powers of
the Legislative Council, based upon Bavin's 1929 reform bill. Following detailed debate
and amendment the bill was agreed to in December 1932. The machinery was then put
in place for the holding of a referendum.
15
MORRISON, A S, "Dominions Office Correspondence on the New South Wales Constitutional
Crisis 1930-1932", in Journal of the Royal Australian Historical Society, (Vol. 61, Part 5, March
1976), p.328
16
see History of the NSW Legislative Council on
, the website of
the Parliament of New South Wales
State Records Authority of New South Wales
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