They presented cheques to each bank and took away well over a million pounds in state government deposits, mostly in small denominations, in suitcases that could then be used to pay wages and salaries.
The cash was stored in the vaults of Treasury’s Bridge Street building and kept out of the hands of Commonwealth officials. Uniformed and armed police patrolled the vicinity and the corridors, giving the Treasury building the appearance of a barracks.
The crisis meant that Treasury now operated as a bank, with special cheques able to be exchanged for cash over the heavily guarded counter.
This situation was frightening for some, infuriating for others, but for the Treasury officers, it was a massive and unprecedented professional challenge.
Eventually NSW Governor, Sir Philip Game sacked the Lang Government, citing breaches of the Audit Act and circulars instructing State public servants to break federal law concerning the recovery of funds owing to the Commonwealth.
The Governor appointed a caretaker Premier and Treasury officials found themselves with a new master and a new challenge – to repair the State’s finances and restore confidence in its governmental processes.
One of the first actions was to move £4,769,502 from the Treasury vaults back to the private banks.
For NSW Treasury, the ordeal was over, but it had arguably revealed itself as adaptable and capable under the most trying of circumstances.
