House of Representatives
5 November 1908

3rd Parliament · 3rd Session



Mr. Speaker took the chair at 2.30 p.m., and read prayers.

page 2041

PRINTING COMMITTEE

Report (No. 3), presented by Mr.

Storrer, and read by the Clerk.

Motion (by Mr. Storrer) proposed -

That the report be adopted.

Mr BOWDEN:
Nepean

.- In the last report of the Printing Committee we had a similar statement of the papers recommended to be printed, nothing being said as to those not so recommended. I wished to have printed the Papuan ordinances, but there was not an opportunity to get the House to express an opinion on the subject, although, I understand, the printing of them was subsequently ordered by the Senate. There should be a record of all documents dealt with by the Committee, and of its decisions in regard to them.

Mr SPEAKER:

– The report of the Committee is submitted in its present form in order that the hands of honorable members may not be tied. If the House were asked to adopt a report recommending that certain papers be printed and that others be not printed, it would not be possible for an honorable member, without the rescission of a resolution, to move subsequently, as can be done . now, that a document, the printing of which was not recommended by the Committee, be printed.

Mr DEAKIN:
Minister of External Affairs · Ballarat · Protectionist

– My clear recollection is that I gave instructions that all the Papuan ordinances should be published, and do not know that this has prevented the Printing Committee from recommending that they be printed, but shall take steps to make certain that they are printed, either on the recommendation of the Committee, or on some other authority.

Mr HUTCHISON:
Hindmarsh

– Ordinances are always printed. An honorable member who desires the printing of a paper which the Committee has not recommended to be printed has only to move in that direction.

Question resolved in the affirmative.

page 2042

PAPER

Mr. DEAKIN laid upon the table the following paper -

Merchant Shipping Legislation - Despatch, dated3rd September,1908, from Secretary of State for the Colonics, together with copy of correspondence between the Secretary ofState and the Governor of Mew Zealand.

page 2042

QUESTION

LITHGOW IRON INDUSTRY

Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP

– Has the Prime Minister yet come to a decision in regard to my request that the report of the New South Wales Government testing officer on theLithgow iron industry shall be made a public paper?

Mr DEAKIN:
Protectionist

– I had received a copy of the report before getting that obtained by favour of the honorable member. It contains the opinions of an expert employed by the Government of New South Wales to test and report on the Lithgow ore and pig iron, and the conduct of the industry generally. The paper, though short, is very interesting, and if the copies which I understand have been circulated amongst honorable members are not sufficient, I see no objection to having it printed as a Parliamentary paper.

page 2042

QUESTION

CHINESE IN QUEENSLAND

Mr McDONALD:
KENNEDY, QUEENSLAND

– Has the attention of. the Prime Minister been called to a paragraph in to-day’s Age stating that Chinese at Atherton- are overrunning the place, and are arriving at the rate of three per day. Some of the Chinese gardeners are said to be almost ignorant of the English language and customs.

Will the Prime Minister ascertain whether there is any truth in the statement that Chinese are landing in the northern parts of Australia and settling in the Atherton district? I ask the question on behalf of the honorable member for Herbert.

Mr DEAKIN:
Protectionist

– I had noticed the newspaper paragraph, and have caused inquiries to be made. The statement may be connected with the fact that of late there has been a steady drift of Chinese into Queensland from the Northern Territory, and from Port Darwin in particular.

Mr Crouch:

– About Port Darwin they can all talk English pretty well.

Mr DEAKIN:

– Most of them can. The statement that the new arrivals at Atherton appear to be unfamiliar with English speech is suspicious.

page 2042

QUESTION

TELEGRAPH OPERATORS: USE. OF TYPEWRITERS

Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP

askedthe Postmaster-General, upon notice -

  1. Is it a fact that in the States other than New South Wales an annual allowance has been made to telegraph operators providing and using; their own typewriters on telegraph work?
  2. Is it a fact that similar concessions have been promised to New South Wales telegraph operators ; that in late promotions to the head office preference has been given to operators having a knowledge of typewriting, and that some officers have provided their own machines for typing purposes?
  3. What steps have been taken to bring this arrangement into operation in New South Wales, and when will the payments in connexion therewith be made?
Mr MAUGER:
Postmaster-General · MARIBYRNONG, VICTORIA · Protectionist

– The answers to the honorable member’s questions are as follow : - 1.In accordance with the provisions of the Public Service Regulation 166, allowances arepaid in cases where telegraph operators are required to provide typewriters and accessories.. In New South Wales the Department had, prior to Federation, purchased its own machines, and consequently the conditions there, so far as the: Sydney office is concerned, are differentfrom those existing in other States.

  1. The promise given was that in all future cases the officers of the New South Wales branch of the Department were to be accorded the same consideration as those in other States. The Deputy Postmaster-General, Sydney, reports that, preference is given in transfers to the Head Office in Sydney to operators having a knowledge of typewriting and flint permission hasbeen given to some officers to use typewriters in order that they may make themselves proficient, but on the distinct understanding that this does not give them precedence in the receipt of the allowance when granted also to some operators who are expert typists.
  2. Instructions were issued, but upon inquiryI find that the amount was omitted from the Estimates. Steps will be taken to provide funds as soon as possible.

page 2042

NATIONALIZATION OF INTERSTATE SHIPPING

Mr HALL:
Werriwa

– I: move -

That in the opinion of this House it is desirable that Inter-State shipping should be nationalised.

In submitting this motion, I am asking honorable members to consider a proposal which will shortly be well within the range of practical politics. In other parts of the world, the tendency towards nationalization has been first to transfer to public ownership transport services. In Australia, while our land transport is a public concern, all transport by sea is controlled by private enterprise; and I propose this afternoon to examine and compare the results of each system. It is a fact that during, say, the last twenty years, there has been a great advance in the way of invention in connexion with both public and private services of the kind ; and my object this afternoon is to apply to the services still in the hands of private enterprise the tests which have been applied to those owned by the public. I admit, of course, that we may fairly look for better service on the railways than we had eighteen or twenty years ago. There is now, practically, the same expense of management as had to be met then; the same salaries are paid to the Railways Commissioners and the managerial staff has not been duplicated, although we have a larger service. As a matter of fact, there is, naturally, better management both in private and public enterprise than formerly ; and that has never been more manifested than in connexion with’ the public services of the world during the last twenty-five or thirty years. The Public Service is no longer a place where a man can find room for a son not able to hold his own elsewhere ; the person who desires to enter the Public Service must, by examination, prove himself worthy, altogether apart from any influence he may command.

Mr TILLEY BROWN:
INDI, VICTORIA · ANTI-SOC

– Is that not a good thing ?

Mr HALL:

– Of course. In addition, there has been an increase of population and increase of production and business generally, which enables a better service to be provided. In connexion with railways, particularly, certain inventions have been applied to haulage, and have, I understand, reduced the coal bill to some extent. I desire to particularly direct the attention of honorable members in the Opposition corner to the results during the last twenty years of the publicly-owned land transport services in Australia. In New South Wales, for instance, the railway employes now work forty-eight hours per week, instead of fifty-four hours, as formerly.

Mr J H Catts:

– That is, the running staff.

Mr HALL:

– Quite so. Then to the Treasury of New South Wales, as the owner of the railways, there has been a net profit of over £648,000 towards its surplus.

Mr TILLEY BROWN:
INDI, VICTORIA · ANTI-SOC

– How does the honorable member make that out?

Mr HALL:

– My authority is the report of the Chief Commissioner of Railways, which shows that the surplus last year on the working was . £648,356.

Mr Bowden:

– The honorable member must not forget that, owing to the way these accounts are kept, past deficiences are absolutely wiped off.

Mr HALL:

– Quite so, but I remind the honorable member that the surpluses are also wiped off, and that, for the previous year, a surplus of £659,916 was shown. I quote these figures to show, first, the benefit there has been to the employes, and, secondly, the benefit there has been to the Treasury. But we see even greater advantages accruing1 to the general public, who are the users of the railways. In 1891 the rates for the carriage of coal and shale were over 33 per cent. higher than they are to-day ; the rates for firewood have been reduced from1s. and 1s.10d. per ton per mile to¾d. per mile; the charge in the case of grain and flour has been reduced from . 66d. to36d., while the carriage rates for both live stock and passengers have also been reduced. The man who travelled by rail twenty years ago had to pay 64d. per mile. To-day he is carried for . 43d. per mile, a reduction of 33 per cent. Within the space of twenty years, the employes of publicly owned transport enterprises have secured better wages, the public throughout the States have reaped huge profits, with the result that taxation has been remitted, while the users have obtained an all-round advantage of over 33 per cent. in rates. When one turns to private enterprise in transport, one finds that the shipping companies, for instances, have, during the same period, secured greater advantages and effected greater economies than have been apparent in connexion with our railways.

Mr Chanter:

– Will the honorable member compare the results obtained from State-owned railways with those obtained from the private railways in Australia?

Mr HALL:

– The private railways of Australia are so insignificant that I do not think a comparison can be made between them and those owned by the States. I should not hesitate, however, to compare the publicly-owned railways of Australia with private railways elsewhere, where railway companies carry on extensive operations. I ask honorable members to consider the advancement that has been made in connexion with the shipping industry during the last eighteen or twenty years. Shipping companies to-day enjoy the advantages of larger services and better management. They have been able to effect great economies as the result of the expenditure of millions of pounds of public funds, which has enabled them to take their vessels where they could not go before. I have only to remind honorable members of the enormous expenditure of the Melbourne Harbor Trust; the expenditure of public moneys on the port of Brisbane ; the immense sum that has been expended on dredging Port Jackson; and the large expenditure on the Fremantle Harbor works. As the result of this outlay of public money, shipping companies can carry on their business to-day far more economically than they could in times gone by. Then, again, the vessels employed are much larger than they were eighteen or twenty years ago, and this increase in size has led to more economical working.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Surely the locomotives employed on the railways have also increased in size, weight, and power?

Mr HALL:

– They have ; but to nothing like the extent shown in the increase in size, tonnage, and power of our shipping. If a shipping company to-day has 5,000 tons of cargo to transport from one place to another, it may carry it in one vessel, whereas twenty years ago it would probably have been unable to put it on to two. It could carry that 5,000 tons of cargo on one vessel with one captain and one set of officers and engineers, whereas in years gone by it would have required at least two captains and two sets of officers and engineers for the work.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I do not wish to controvert what the honorable member is saying; I simply suggest that he is losing sight of the fact that the average train load has, at least, doubled within the last twenty years.

Mr HALL:

– Perhaps I did not enter sufficiently into details when I referred to that phase of the question. I frankly admit, however, that one of the advantages enjoved by our Railways Commissioners to-day, as compared with twenty years ago, is to be found in the fact that we have a much larger population and far greater production than we then had.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– They say that that is also a disadvantage from their point of view.

Mr HALL:

– If the average trainload has been doubled, the average shipload has been considerably more than doubled within the same period. That represents a substantial economy for the shipping companies. A steamer of 1,000 tons burthen requires three or four engineers, whilst a steam-ship of 5,000 tons requires only six or seven engineers. Then, again, the smaller vessel would require eight deck hands, whilst a 5,000-ton steamer carries only twelve. In other words, the larger vessel can cany five times the cargo, with an increase of about only 50 per cent. in the number of its hands. The coal bills of shipping companies have likewise been considerably reduced. The average 2,000 ton steamer of twenty years ago would require 40 tons of coal to enable it to cover a certain distance, whereas a 5,000-ton steamer fitted with triple expansion engines would run the same distance to-day on 80 tons of coal in considerably less time. A saving of over 10 per cent. in the coal bill is secured in this way, and a saving of over 12 per cent. in the time occupied That, again, means a substantial economy.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– The consumption of coal varies on different vessels.

Mr HALL:

– I am speaking of the average in both cases. Shipping companies do not equip their vessels with triple expansion engines instead of the old compound engines for the mere fun of the thing ; they make the change because they are thus able to effect economies. They secure in that way a comparatively slight saving in the quantity of coal used, but a substantial reduction in the time taken to do a journey.

Mr Atkinson:

– The honorable member must not forget that the capital sunk in uptodate steamers to-day is very much larger than it was.

Mr HALL:

– And so with new railways.

Mr Atkinson:

– The cost of railway construction has been decreased.

Mr HALL:

– That may be so in respect of a given line, but the capital expended on any one new railway will compare with that expended on any one ship. Another.very substantial economy is secured by the use of improved loading gear. The average steamer to-day has larger hatches and’ ten times thenumber of winches that were employed on a steamer twenty years ago, and can be loaded in considerably less time than it took to load a vessel of similar size in days gone by. Twenty years ago cargo had to be stowed away in small spaces, whereas to-day there is plenty of room in which to handle it. Shipping companies enjoy far greater ad- vantages than fall to the lot of publiclyowned railways, but what is the result of their operations? I have said that the hours of the railway employes of the States have been substantially reduced, but that remark will not apply to the hours of seamen. I am told that, with the exception of a few highly-favoured officers in charge of very large vessels, the men employed in the shipping industry receive practically the same wages as were paid many years ago, and that they work the same hours as before. I am told, further, that since, as the result of the Shipping Combine, competition has ceased in connexion with our Inter-State shipping, fares and freights have been raised. So that all the inventions and improvements that have expressed themselves in the case of the railways in the shape of better conditions for employes, bigger profits for the Treasury, and a cheaper service for the public, have, in the case of shipping, expressed themselves in advantages to the few who happen to be shareholders in the companies. All the economies that the last twenty years have brought, have gone, in the case of shipping, into larger dividends, bigger reserves, increased capital, increase of ships built out of profits, and watered stock. That has been the result in that particular domain of private enterprise. It is absolutely impossible to obtain from their balance-sheets anything like a reasonable idea of the profit that the average shipping company is now making. Financial experts give it up, but there is no doubt that, owing to the highly favourable position in which the Inter-State ship-owners find themselves, they are making huge profits at the expense of the public. In the case of the Adelaide Steam-ship Company, I quote the following from evidence given in 1906 before the Navigation Commission by a gentleman who is now Melbourne manager for the firm of Messrs. J. and A. Brown -

I bought £10 shares in the Adelaide Steamship Company about sixteen years ago at 32s. each.

When asked the price of those shares today, he said -

They were £10 shares; but they have since been called in, and five £5 shares issued for each £10 share; and I think these ^5 shares are £6 5s. in the market to-day, so they are about £3°-

That means that the capitalist, who sixteen years ago bought Adelaide Steam-ship

Company’s shares in the open market for 32s. each, can now. sell them for over £30 each.

Mr Atkinson:

– He is a very lucky man.

Mr HALL:

– Any man who owns shipping company’s shares is a lucky man.

Mr Glynn:

– The value of the shares has increased to a large extent because the assets have increased.

Mr HALL:

– Yes, and they will go on increasing. If we allow the present state of affairs to continue, all the advantages will still go into the pockets of the favoured few instead of being available for the benefit of the general public. I am assured that the Adelaide Steamship Company is not more successful than other shipping companies.

Mr Glynn:

– To discount the effect of those comparisons, I point out that the shares now represent bigger assets.

Mr HALL:

– But those assets have been obtained, not by calling up fresh capital, but by building up huge reserves from profit. A large increase of assets may put the company in a better position, but it does not alter the fact that what a man bought for 32s’. he can now sell for over £30. That is a great profit, but I am assured that it represents the average profit of the Inter- State shipping companies. They must be making great profits, for they have not followed the example of the Railways Commissioners in reducing freights and fares. They have not given better wages, and are pocketing what in the case of a public enterprise goes into the hands of the Treasurer. There are in the House certain gentlemen who have a great belief in the efficacy of competition as a means of solving difficulties connected with private enterprise. But, however much they may favour competition, they can get none from the shipping companies to-day. Those companies have a ring, and it may be well to place on record how it works. I have heard honorable members of the Opposition say that there can be no monopoly of the ocean, but the fact remains that there is such a monopoly.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Who ever said that? I have never heard it said.

Mr HALL:

– I think the honorable member interjected in the course of a speech of mine that there could be no monopoly of the ocean.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– That is quite right. But it ‘is different from what the honorable member said before.

Mr HALL:

– There is an effective monopoly of the ocean so far as Inter- State shipping is concerned, and 1 am assured that it exists very largely in the case of international shipping also. Let us examine the way in which the combine works, for it is only by the existence of the combine that those huge profits are possible. I quote from evidence given before the Navigation Commission by Mr. Mcpherson, who represented the Melbourne Chamber of Commerce and the Importers’ Association of Victoria. Asked by the AttorneyGeneral to explain how the combine worked, he gave this example -

In 190:5,’ when I had 300 tons of iron to ship to Fremantle, I went to the shipping people to learn the rate of freight. They held a meeting, and then they gave me a quotation. They said “You will have to pay 18s. a ton now, but in twelve months’ time, if you confine all your shipments to the ports on the north and the west to the companies within the ring, we shall grant you a rebate of 20 per cent.” In other words, I had to leave with them a hostage of 3s. 6d. a ton on the 300 tons, and let it stay in their hands for twelve months. Had I not agreed to confine all my shipments to the Association, I should have had to charge r8s. a ton for the freight of tlie iron, and probably I should have lost the business. Of course I said, “ Very well, if those are your terms I shall accept them. I shall pay the rSs. per ton now.” But when I quoted a price to my customer, I quoted on what is known as the c.i.f. basis. I paid the freight to Fremantle, and last month I got from the shipping people a cheque for £7$.

That is the way in which all Australian merchants are now dealt with. They have to put up what that gentleman calls a hostage of 20 per cent, as a guarantee that they will not encourage any competition to come into the market, or accept lower freights offered by rival steam-ship companies. By that means the Inter-State companies have succeeded in setting up an effective monopoly of coastal shipping, and hold to-day considerably over ,£100,000 of the merchants’ money, any part, or the whole, of which may be forfeited whenever any merchant takes it upon himself to exercise his liberty in choosing to send his goods by another vessel.

Mr Knox:

– What evidence has the honorable member as to that amount of £100, 00c ?

Mr HALL:

– The evidence of Mr. McLennan, who invented the system, and who stated that nearly three years ago the amount was considerably over £60,000. I have further evidence, which to me is convincing, that with the increase of business it has risen to considerably over £100,000. The gentleman who invented the system, but who afterwards on leaving the companies was prepared to give the show away, stated also that about 20 per cent, of that money was never claimed, owing to the delays and difficulties in getting it, and for various other reasons. In asking the House to affirm the desirability of the State ownership of shipping services, bringing sea transport into line with land transport, I submit that a comparison of the advantages gained by the public from the State administration of the railways with those gained in connexion with private control of the shipping services, will make it appear to any unprejudiced observer that the public interest demands that sea transport shall become a State concern. Railway freights and fares are much lower than they were twenty years ago, and the railways do much more to develop the country than is done by the shipping companies. For years New South Wales has worked some twenty non-paying lines. But no shipping company would work non-paying services merely for developmental purposes. Where there is an almost immediate prospect of recouping the outlay, a shipping company, for a time, may run a service at a loss ; but the State can afford to run lines at a loss, purely for developmental purposes, without interfering with the reduction of the freights and fares, or the earning of surpluses. When New South Wales was suffering from the last bad drought, the shipping companies did nothing for the protection of the public interest, but the public railways carried starving stock and fodder for practically nothing, trucks being nin 600 and 700 miles for a charge of about ios., which was not enough to pay for the axle grease used.

Mr Chanter:

– The private railways of the State refused to reduce their rates at that time.

Mr HALL:

– Naturally. It would have been foolish on their part to reduce rates, and so reduce their profits. Private persons are not in business for philanthropic reasons; their design is not to benefit the country, but to enrich themselves. I do not blame them, nor do I complain of them. Were it my good fortune to be offered shares in, say the Adelaide Steam-ship Company, I should take them gladly, regarding the public as fools for letting me enjoy the profits. I blame, not those who are managing the shipping companies, but the parliamentary representatives who allow shipping transport to remain a private concern, and the electors who send men here to stand by the existing state of things. Greater economy is possible in connexion with a public service than can be practised by private companies, seeing that in the one case there is a monopoly, while in the other there is always competition, or the fear of it, to be provided against. The companies forming the shipping combine do not know that it may not break up at any time, and, therefore, they are building vessels which are not really required for the trade, to be held in reserve against another period of competition. If sea transport were a, Government monopoly, only such boats would be used as were needed for the service. Committees, which made inquiries in Germany in connexion with railway and shipping transport, recommended that it is a decided advantage to have through bills of lading, covering both land and sea transport. If a man could send wheat from one part of Australia- to any other by means of one bill of lading, it would be a great convenience to all concerned. It is admitted - and I ask the attention of those who will not go with the Labour Party in demanding the nationalization of monopolies - that most of the leading writers on political economy, whether Socialists or non-Socialists, have expressed the view that the day is not far distant when all transport will be a State concern. It has been found by experience that it is of the greatest assistance to the building up of other monopolies, to secure a transport monopoly. Those who have written the history of the Standard Oil Company - perhaps the most successful trust in the world - have told us that what made its success possible, was the securing of all means of transport. It would be possible for our shipping combine to work in with our sugar monopoly, if it were thought that it would pay to do so.

Mr Atkinson:

– What about our antitrust law ?

Mr HALL:

– -I expressed my opinion on it when the Bill was introduced. I do not hesitate to say again that persons cannot be made to fight when it pays them better to act in concert. That it pays the shipping companies to remain in combination is shown by an examination of their balance-sheets. A Committee of Congress, in America, so far back as 1874, seeing the beginning of the Standard Oil Trust, made the following recommendations -

The only means of securing and maintaining reliable and effective competition between railways is through national or State ownership, or control of one or more lines which, being unable to enter into combinations, will serve us a regulation of other lines. One or more doubletrack freight-railways honestly and thoroughly constructed, owned or controlled by the Government, and operated at a low rate of speed, would doubtless be able to carry at a much less cost than can be done under the present system of operating fast and slow trains on the same road ; and, being incapable of entering into combinations, would no doubt serve as a very valuable regulator of existing railroads within the range of their influence.

That was the recommendation of antiSocialists. Even scientific non-Socialist writers, like Hobson and Ripley, admit that it is unsafe to allow the control of transport to remain with private enterprise. Besides the reasons which I have given, I would mention as an additional ground for supporting the motion, that the economies which will result from future improvements and inventions should be enjoyed, not by those who now control the shipping services, but by the great mass of the people.

Mr Johnson:

– This sounds like Socialism.

Mr HALL:

– I hope that I may apply to it the words of the honorable and learned member for Bendigo, “I do not care whether it is Socialism; it is common sense.” Engineers, generally, think that we are on the eve of greater alterations in connexion with marine engines than have yet been known. It is thought that the internal combustion engines will take the place of the external combustion engines, and that great economy will be effected in that and other ways.

Mr DUGALD THOMSON:
NORTH SYDNEY, NEW SOUTH WALES · FT; ANTI-SOC from 1906

– Then this is not a good time for buying up old ships.

Mr HALL:

– Unless the State takes control, the shipping companies will benefit by these improvements, as they benefited by the adoption of triple expansion eng. nea. Inventors will not stop still after 1908. New improvements will be put forward every year, and it is for us to say whether the public or the shareholders in the shipping companies should get the advantageof them. I hope that within a few years this Parliament will be able to effectively protect the people from the robbery associated with private monopoly, by managing, our coastal services for, and in the interests of, the people.

Mr FOSTER:
NEW ENGLAND, NEW SOUTH WALES · ALP

.- I have listened with great pleasure to the speech of the honorable member, who has put some very important facts before us. No doubt, the anti-Socialists look upon his proposal as a further encroachment of co-operation or Socialism upon the domain of private enterprise. But this seems inevitable in the progress of the world. Even those who bitterly opposed such Socialism a few years ago, are coming to see that in these matters the public interest is served by co-operation, and many converts to our views are being made. It seems to be thought by some that the Labour Party stands for the nationalization of monopolies only. Personally, I think that whenever the’ public will benefit more by co-operation than by private enterprise, the State should step in. The settlement of Australia is thickest all round the coast-line of the continent, and it seems likely that in the near future the coastal railway services and the shipping services will clash. The New South Wales Parliament has resolved upon the construction of a railway from Newcastle to the Northern River districts. When first proposed, it was very hotly criticised, it being said that there would be very active competition for freight between the coastal shipping companies and the Government, perhaps to the disadvantage of the latter. If the shipping were in the hands of the Government, these splendid transport services could be worked in perfect harmony, and aid, in a much more efficient way than they now do, the development of our industries. Our producers have suffered greatly at the hands of the shipping companies, in consequence of careless handling; and time after time have experienced losses, because they were not in a position to fight a big corporation in the Law Courts. Unless a man has practically a certain case, he has small hope of any compensation ; whereas, if the shipping were in the hands of the Government, the chances are that cases of the kind would scarcely be heard of. Another advantage of Government control would be the provision of more seaworthy ships, which, of course, means much for the producers ; and, further, the conditions would be much improved for the men employed on the vessels. Every one knows the great struggles there have been to better the lot of our seamen. The shipping companies, as the honorable member for Werriwa has said, cannot be blamed for desiring to make profits; and any demands for better conditions have always been fought from that point of view. However, there is no necessity for me to dwell on a point that is self-evident. There remains the better treatment which passengers would have, if the shipping were under Government control. I have travelled all round Australia, except in the far North ; and I have had some experience of voyages between here and New Zealand. From my observations I can say that unfortunate steerage passengers are treated almost like pigs ; and I have often thought that the companies ought to be ashamed to accept their money and then afford such miserable accommodation. I have seen steerage passengers, who were subject to mal-de-mer, forced to breathe a foetid atmosphere in itself calculated to make any one ill. Of course, although it may seem very paltry, the shipping companies save something on the food of such passengers; and, in. the aggregate, that saving must amount to many thousands of pounds in the year. In the early days of the Western Australian rush we had some glaring examples of the treatment meted out to steerage passengers by private companies. We can well understand how different the conditions would be under Government control - how much more comfortable the position would be, not only of passengers, but of the seamen. A further fact is that some of the old tubs and barges, now on the coast, are so slow as to inflict great hardships on the shippers of perishable products. I have very much pleasure in seconding the motion of the honorable member for Werriwa.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– I suggest that this debate be adjourned, in order that I may consult the Cabinet on the subject.

Debate (on motion by Mr. Chanter) adjourned.

Motion (by Mr. Hall) proposed -

That the resumption of the debate be made an Order of the Day for Thursday, 19th November next.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I do not know why there is a desire to have the debate adjourned.

Mr SPEAKER:

– That question has been settled.

Mr Chanter:

– This is a serious proposal, and it requires consideration.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Is it really serious? I thought that honorable members were only out for a little airing, though, no doubt, their speeches will make admirable reading in the local newspapers.

Mr SPEAKER:

– The question before the House is the date for the resumption of the adjourned debate.

Mr J H Catts:

– Is the honorable member for Parramatta in order ?

Mr SPEAKER:

– The’ honorable member for Parramatta is perfectly in order in discussing whether the adjourned debate shall be set down for 19th inst. - that is the only Question before us.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– In my opinion, there is no need for an adjournment, because honorable members are quite ready to vote.

Mr SPEAKER:

– The question of the adjournment has already been agreed to.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Then, to put myself in order, I move -

That the words “ 10th November “ be left out, with a view to insert in lieu thereof the word “ to-morrow.”

It seems quite unnecessary to discuss a matter like this session after session,, and always postpone it.

Mr Hall:

– The nationalization of Inter- State shipping has never before been discussed by us.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The question was discussed in connexion with the provision of Commonwealth mail steamers, and on the report of a Royal Commission which dealt with that question, and every honorable member knows as much of the subject to-day as he is likely to know in two weeks’ time.

Mr Hall:

– I should like to know some of the honorable member’s reasons for opposing the motion.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I was about to point out that the honorable member, as he had a perfect right to do, used only those arguments most favorable to his proposal ; the obligation rests on us here to bring out the facts. It seems to me that the Government simply desire to tide over the afternoon. Strange to say, the Honorary Minister appears to be permanently in charge, of business on private members’ day, and invariably desires to consult the Cabinet.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– We have discussed several questions on private members’ day, and disposed of them.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– At any rate, it is very inconvenient to have only the Honorary Minister here, and the Prime Minister absent.

Mr HUME COOK:
BOURKE, VICTORIA · PROT

– Apparently, the honorable member wishes to dispose of this question straight off !

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– And so would the Honorary Minister if he were not influenced by other motives ; but honorable members in the Labour corner cannot be put off in a peremptory way. Is there any undertaking that the Government will provide an opportunity for the discussion of this matter in a fortnight’s time? The notice-paper for the 19th inst. is pretty full ; and there is another motion for that day, in the name of a Labour man, in favour of the nationalization of the tobacco industry. The honorable member for Werriwa is consenting to an adjournment,knowing right well that, there is not a shadow of chance of the discussion on his motion being resumed on the 19th.

Sir William Lyne:

– Let us get on with business.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I might as well waste a little time, as honorable members in the Labour corner do, with frivolous motions which mean nothing, and are intended to mean nothing. The honorable member for Werriwa, after defending his proposal with a great deal of ability and erudition, is consenting to an adjournment, which he knows means the shelving of the question for the session. “ What is the use of such political fireworks? I should like to know the Government attitude on the question, and also the attitude of the colleagues of the honorable member for Werriwa. There may ba evolution and growth even in the Labour comer ; but I remember distinctly that about two years ago, when the mail steamer question was under discussion, the late leader of the Labour Party said that the time was not ripe for nationalization.

Mr Batchelor:

– He said that InterState shipping ought to be nationalized first.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Did the honorable member definitely commit himself to the nationalization of the Inter-State shipping ?

Mr Batchelor:

– I am not going to commit him.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– It is easy to express hypothetical preferences when there is nothing better to do; but I have yet to learn that the late leader of the Labour Party is in favour of nationalizing shipping of any kind.

Mr SPEAKER:

– The only question before the Chair is the date for the resumption of the debate.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I am trying to show th:t there are reasons why this motion is being shelved. It seems to me that there is nothing serious about the whole business. In another Chamber a section of the LabourParty-

Mr SPEAKER:

– The honorable member must not refer to debates in another branch of the Legislature.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I do so only to point out the propaganda of the Labour Party. It really appears, judging by the perfunctory and dilettante manner in which these questions are discussed and postponed that there is no serious intent, and the sooner people who are interested in the success of such motions know the facts the better it will be. An opportunity is now presented for the honorable member for Werriwa to do something, but he absolutely declines, although he knows that another opportunity will not arise for many weeks. He is deliberately postponing this business to a day when he knows there will not be the remotest chance of dealing with it.

Mr J H Catts:

– Does the honorable member know that that is misrepresentation ?

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The honorable member, in a parrot-like way, says that half-a-dozen times a day A parrot could make thatstatement in a much better voice.

Mr Hall:

– But not at a more appropriate moment.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– Perhaps not. The people outside, who are the judges, can form their own conclusions. The honorable member for Werriwa is deliberately proposing to adjourn further consideration of his motion until the 19th November, knowing full well that on that date two other motions, which cannot be disposed of during the time available for private members’ business, will take precedence. The honorable member may say that I am misrepresenting the facts, but they speak for themselves. As to many of these proposals, concerning which honorable members of the Labour Part) profess so much anxiety, and for which they struggle so keenly in verbal conflict, I do not think that they have any intention that they should be carried into effect in the immediate future.

Mr Hall:

– I wish, Mr. Speaker, to reply to the debate on the motion for the resumption of the debate.

Mr SPEAKER:

– There is no right of reply to a motion of that kind. After a debate on the second reading of a Bill or any substantive motion, the mover hasthe right of reply, but there can be no reply toa debate on a mere motion to fix a date on which an Order of the Day shall be set down for consideration.

Mr Hall:

– May I make a personal explanation ?

Mr SPEAKER:

– As soon as I haveput the question. As the amendment is not seconded, 1 cannot put it.

Question resolved in the affirmative.

page 2050

PERSONAL EXPLANATION

Mr HALL:

– I desire to make a personal explanation. The honorable member for Parramatta has said that I have endeavoured to have the resumption of the debate on my motion with reference to the nationalization of InterState shipping fixed for a day on which it could not possibly be taken, since two other notices of motion - one of them relating to the nationalization of the tobacco industry - would take precedence. I can only say that the honorablemember, in his desire to criticise our motives, does not seem to be able even to read the notice-paper correctly. If he will take the trouble to refer to it, he will see that the resumption of the debate on my motion on the 19th November would not clash with the debate on the motion for the nationalization of the tobacco monopoly, which is set down for that date. The adjourned debate on the motion I have; submitted will be an Order of the Day, and will be called on immediately after consideration has been given to the Public Service Bill introduced by the honorable member for West Sydney.

Mr JOSEPH COOK:
PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– I admit that I have made a mistake.

Mr HALL:

– Then I have nothing more to say.

page 2050

QUESTION

DIRECT TAXATION FORNATIONAL DEFENCE

Debate resumed from 8th October (vide page 952), on motion by Mr. Mahon -

  1. That in the opinion of this House, the practice of defraying the cost of national defence out of Customs and Excise taxation is inequitable and unjust, and ought to be discontinued.
  2. That, as one of the main objects of national defence is the protection of private wealth in its various forms, the possessors of such wealth should be required to contribute by direct taxation an adequate sum towards the naval and military expenditure of the Commonwealth.
Mr MAHON:
Coolgardie

– The proposition which I have the honour to submit embodies a principle so obviously just as to be unchallengeable on any ground of equity. Stated in the fewest words, this principle is that the cost of national defence is a proper and legitimate charge against the wealth of a nation. This resolution, indeed, runs parallel with that ancient canon of taxation which provides that the contribution of citizens towards the expenses of government should be in proportion to the revenue which each enjoys under the protection of the State. The development of highly -organized society has evolved some complex problems, but it has also conferred upon the units in society increasing .benefits directly and indirectly. To the owners of wealth, organized societyguarantees security of its possession and continuance of its enjoyment - a service for which organized society is entitled to be directly recouped. I propose to show that our existing system of taxation is defective in this regard : that it permits wealth to escape adequate payment for the protection extended to it, and imposes the larger share of the burden upon the small incomes of the middle class and upon the scanty earnings of the workers and the unpropertied mass. It is quite true, of course, that national defence is instituted for additional ends other than the protection of the country’s wealth. We maintain it for the preservation of home and liberty, because we desire to hand down to our children all the benefits of an enlightened civilization. This separate aspect of the question cannot be ignored, and in its proper place it will receive consideration. Now, whatever objection may be offered to this resolution, it cannot be opposed on the ground that it introduces an innovation. From the earliest times the wealth of England was levied on to provide the sinews of foreign wars as well as the funds for internal defence. At first the obligation rested on the King, whose resources were supplemented by exactions from the nobles. It is on record that the estates of the King, from the Conqueror to the Confessor, covered the country and comprised numerous manors, many towns, together with rights of rent-charge over other towns.. His resources were, therefore, abundant. The army and navy were certainly recruited from the common people, but the taxation for war purposes did not directly touch them. Indirect taxation was scarcely known at all in early England, the then existing duties of Customs yielding merely nominal amounts ; while the device of Excise taxation was not acclimatized in Britain until about 1642. It is interesting to recall that the Parliament of the time borrowed it from the Dutch, and that the King and the Cavaliers denounced it as an unheard of tyranny. They speedily adopted the system themselves, however, collecting the tax whenever they were able. Excise was again denounced at the Restoration; but, as Professor Thorold Rogers points out, it was made hereditary so that the great landlords might emancipate their estates from feudal dues at the expense of the general public. The reproach has a modern application, for in relieving wealth from its proper share of the cost of protecting it, we are granting its owners undue advantage similar to that which the great landlords wrested from Parliament centuries ago. But to return. A few instances out of many may be cited to show that in olden times the wealth of England bore almost the whole cost of military enterprises. A part of the finance of Cromwell was heavy direct taxation of land. The owners regarded the tax as intolerable, but they had to pay it. In 1453, Edward IV. obtained from a property tax money to recover Aquitaine. In 1641, some ^400,000 were exacted from certain counties and towns for the suppression of the great insurrection in Ireland during that year. In 1649, a levy °f £90,000 was made for paying the forces, and in 1657 Scotland was called on for £6,000, and Ireland for £9,000 per month for military purposes. In. 1672, a tax of £1,500,000 was levied on several counties and nine cites and towns to assist Charles II. in his nefarious war against the Dutch. It is worthy of note that after he got the grant he stole the goldsmiths’ money. A part of the cost of the war of the Austrian Succession in 1748 was paid from levies on houses and private carriages, while eight -ears later publicans, owners of plate, cards, and dice were called on to help in meeting the bill for the Seven Years War. These citations mark Britain’s constant recognition of the duty of wealth to provide for defence at home and aggression abroad. And the principle is. still vital in British finance, as high income taxes and heavy succession duties sufficiently attest. Neither in ancient nor modern England, then, can we find precedent for our action in saddling the poor with the heavy end. of that load which should be borne almost entirely by the rich. We stand practically alone as participators in a flagrant form of class taxation. Its class character would be seen at once were the tax collected directly from the people. Let us imagine a tax-gatherer going round and taking from the unpropertied worker at the end of the week a portion of his wages as his share of the cost of protecting property. The dullest would in such circumstances perceive the infamy of the transaction. He would ask inconvenient questions, and make awkward comparisons. Possessing no property, he would see that he had little, if anything, to fear from an enemy’s confiscation or demands for indemnity. He would naturally insist on knowing why he should pay as much, or nearly as much, as his wealthy neighbour, for whom a war of conquest would have real terrors; because even if he escaped confiscation, wealth would assuredly p;w whatever indemnity a successful invader succeeded in exacting. It was not the wage-earners of France, but the owners of the wealth of France, who found the £i, zoo, 000,000 for the victorious Prussians in 187 1. And so it must ever be. Only the persons who have the money can pay the fine. They therefore are mainly concerned in seeing that no enemy should be in a position to inflict a fine. On this point, a recent writer resorts to special pleading, in order to rebut the doctrine advanced by Montesquieu in his Esprit des Lois. The latter affirmed that the revenues of a State consist of the portion which each citizen gives of his fortune in order to enjoy securely the rest - a definition differing only in phraseology from Adam Smith’s. This the critic describes as the quid pro quo theory of direct taxation - an excellent theory and an apt description of it. But he objects that “ The services of the State are wholly incapable of exact measurement and apportionment to individuals.” Not all services, surely. In Australia we obtain many services from the State - and we intend to receive more - which are accurately appraised and paid for according to the use made of the service in each case. Then we are told that if the State merely offered to each individual security of property in exchange for taxes, the weak - requiring greater protection - should pay more than the strong, and those most able to pay might contribute least. But no class is weaker or stronger than any other when the country is menaced by an enemy. If the enemy is able to take the country, he takes control of everything and everybody in it, strong as well as weak. Finally,, it is said that public expenditure confers collective advantage which cannot be stated in quantitative terms. That this is not so as regards defence expenditure may be realized by conceiving the position of a country from which all naval and military protection had been suddenly withdrawn. Property in such a country, on the appearance of a formidable enemy, would have little, if any, exchangeable value. What sane person would to-day buy with gold something which might be wrested from him next week or next month ? Hence the advantage which wealth derives from effective national defence can be stated, not only in “quantitative” terms, but in terms of tolerable precision. The advantage lies in continued ownership as against the alternatives of confiscation or the payment of a heavy indemnity. For that advantage the owner ought to pay a proportionate premium. He does so when he insures his house against fire, his jewellery against robbery, or his yacht against shipwreck. As he recognises the fairness of paying these premiums out of his own pocket, why should he expect less-favored citizens to pay from their poverty the bulk of the premium against the confiscation of his property by an invader? This brings me to a consideration of the relative contributions of the several sections of thepeople to the total indirect taxation, from, which defence expenditure is met. As tothis, one might base an estimate on thecommon facts and observations of daily life. He might without much danger of unfairness disregard statistics, and generalize that as the workers constitute the vastmajority of the State, and as the taxation, is levied on articles of general consumption, their payment to the revenue must beimmeasurably larger than that of the affluent minority. Both Customs and Excise Tariffs are specially devised to reachthe bulk of the community. If these Tariffs did not touch articles in general’ use, Governments would not have sufficient revenue to meet their obligations. It would be futile to digress into a discussion of the point that many taxable articles - may be classed as luxuries or superfluities, and that if the worker chooses to indulgein these things, he is taxing himself. All?

I propose to say on that heading is, that many commodities not found indispensable in a primitive state of existence have come, through usage and example, to be regarded by the average man of to-day as necessaries. 1o escape taxation altogether a man would need to live like an anchorite. Let me anticipate the contention that the worker can dispense with the burden he now bears by giving up spirits, beer, and tobacco. The answer is that if he abandoned the use of such commodities, the necessities of government would compel the transfer of the taxation to articles which he and his family cannot do without. We have to raise a revenue of eleven millions yearly, and no financial genius has yet appeared in this country to show how that can be clone without making a levy on the general community. But I do not propose to rely on any process of generalization to enforce and Illustrate the conclusions at which I have arrived. I intend to make it clear, by the recognised method of handling figures, that over eight of the eleven millions to be raised this year will come out of the pockets of wage-earners and persons with comparatively moderate incomes. This, of course, is an approximation, for the available data is insufficient to enable one to reach infallible results. The House is therefore entitled to know how the estimate has been reached, and having given it, I shall gladly welcome the closest analysis and the freest criticism. It will be admitted that the gross taxation payable by each class is to be gauged mainly by its numbers. I repeat the word V mainly,” because the number of any selected group is not an unerring guide to its spending capacity. I am far from contending that, man for man, or family for family, the worker consumes taxable commodities of equal value with the affluent person. But as he usually rears more children, he will relatively contribute more to the revenue than the head of a smaller well-to-do family, each using the same proportion of dutiable goods. Mr. Sydney Buxton, M.P., says -

In every purchase the poor man pays for his poverty. He pays more highly because he cannot afford to buy largely ; he pays more heavily because he cannot afford to buy of the best. Taxes are levied at the same rate on different qualities of the same article, with the result that the duty is far more burdensome on the cheaper than on the costlier article.

And he then mentions that certain inferior tobacco paid a duty of 1,000 per cent. on> value, while on the best kinds of cigars the impost ranged between 10 and 20 per cent. This remark- is applicable in a measure to our own Tariffs. With a slight exception as to tobacco, there is no differentiation inthe duties imposed. The highest quality of spirits and the lowest quality, bear the same duty. Beer, sugar, and other articles come within the same category. Theeffect is that the poor, whose narrow means, compel the use of articles of inferior quality, pay on an equal consumption of dutiable goods an undue share of the taxes. Hence, to remedy this inequality and restore the balance, justice demands the imposition of direct taxation for general purposes as well as for national defence. Considering the pressure on our resources, the demand that the propertied minority shall pay adequately and directly for thepreservation of their wealth may be expected in the near future to become irresistible. Taking official statistics as a basis, I now proceed to deal with the distribution of wealth in this country and itscapital and annual values. The private property in Australia was valued in 1903, by Coghlan at £981,979,000, land and improvements on land accounting for £683,944,000, or nearly 70 per cent, of the total. Cog/dan admits that this, which takes no account of good-will and other items, is an under-valuation, and that £36,000,000 might be added to his estimate of the wealth of New South Walesand Victoria alone. Using round figures, the private wealth of Australia may therefore be safely set down at £1,000,000,000. One thousand millions ! One needs pause to realize the colossal proportions of this accumulation. Yet the owners of it donot directly contribute a shilling to the fund which guards it against confiscation. The whole case might be allowed to rest on the statement of this pregnant factAt 4 per cent., £1,000,000,000 will earn £40,000,000 per annum. Three-fourths of it probably earns more than 4 per cent., because Government securities vield almost that rate on an average, and the return from private investments is generally a point or two higher. Now, it mav be admitted that if this wealth were held in equal or nearly equal shares bv the units of the community, there would be no great hardship in paying for defence out of indirect taxation. But it is notorious that the wealth of this country is held by comparatively few individuals. Mr. Coghlan points out that in 1903 half the private wealth of New South Wales was owned by some 3,000 persons. The figures he supplies suggest that his estimate was well within the mark. The assessment was £368,778,000, of which 81 per cent., or £300,000,000, belonged to 3,073 individuals. The rest of tha population of New South Wales, numbering 1,424,269, possessed less than 19 per cent. of the wealth - under £69,000,000. Applying this deduction to the wealth and population of all Australia, it will be seen that 8,450 persons own £810,000,000 ; while the remaining £190, 000,000 is divided amongst 3,918,540 persons. Carrying the analvsis further, as Coghlan’s researches enable us to do, the results are even more striking. In 1903, New South Wales contained 739,589 adults, of whom no less than 544,972, or nearly 75 per cent., possessedno property whatever. The corresponding numbers for the Commonwealth would be - total adults, 1,308,000; adults without property, 981,000. Here it may be remarked that the word “ adult “ is not the equivalent of “breadwinner,” since there are many breadwinners who have not reached adult age. As everv 100 adults maintain 125 dependents, it follows that 2,635,000 persons must be deducted from the number who own the £190,000,000 worth of property. So that the anomaly may be more clearly perceived, let me summarize the position : -

Owned by 8,450 persons - £810,000,000.

Owned by 1,283,540 persons - £190,000,000.

Owned by 2,635,000 persons - nil.

Totals - (population), 3,926,990; (wealth), £1,000,000,000.

It is, unfortunately, not possible by any data from Coghlan to trace further the distribution of the £190,000,000. A more exhaustive examination would probablv disclose that the owners do not exceed half -a-million persons. Indeed, this conclusion is strengthened by a study of the annual incomes of the people, so far as statistics are available. The census of 1901 fixed the number of breadwinners in the Commonwealth at 1,652,280. Allowing for the increase in population since 1901, the total breadwinners should now be 1,684,000. As the position of the Commonwealth is substantially reflected in that of one of the older States, the statistics of Victoria, which are the completest available, may be used as a measure of the incomes of the Australian people. The standard may not be absolutely exact, but Victorian conditions do not differ so materially from those of the other States as to vitiate the estimate. As the Victorian quota of our total population is about 30 per cent., the number of breadwinners in this State may be taken at slightly over 505,000. Yet the last income tax returns, 1906-7, show that only 8.7 per cent. of the breadwinners, that is, 44,262 persons, earned sufficient to warrant attention from the Income Tax Commissioner. This leaves 461,000, or over 91 per cent. of the breadwinners in this State, whose earnings did not reach the taxable minimum of £151. Income tax is collected on wages, salaries, fees, profits, and other earnings - “ personal exertion “ is the orthodox term - but the tax is also collected on incomes from property. Now, we find that, excluding those who pay on property income, the number of Victorian income taxpayers dwindles down to 39,753, or 7.9 per cent. of the total breadwinners. Thus we see that 92 out of every 100 engaged in industry receive less than £151 per annum, a fact which deserves the strongest emphasis. The returns show that£12,709,857 earned by personal exertion was taxed, of which 34,822 persons earning under £500 yearly paid on £5,086,688 ; and 4,931 persons earning over £500 annually paid on£7, 623, 169. As to propertv. 8,348 persons paid on an income of £2,929,544. The significance of these results will be apparent at a glance. An income of over10½ millions was received by propertv owners and others earning over £500 annually ; while a group nominally over four times greater divided little more than five millions. As this latter group includes all receiving from £151 up to £500, the latter being an exceptional income, it is a fair inference that the bulk of the taxpayers in this group earn less than £250 per annum. Had the statistics shown the number who pay on earnings between £151 and £300, the disparity in the incomes of the several groups would be still more pronounced. However, in the incomplete form chosenby the Government Statist, the Victorian results prove that the masses, who pay so much for the protection of wealth, possess an insignificant share of it. In the following: table. I have sought to apply the Victorian data to the population of the Commonwealth.

That is to say, the results shown would be come taxation enforced in Victoria were exobtained if the rate and conditions of in- tended to Australia : - Dealing first with the taxable income from personal exertion, it will be seen that 60 pex cent, of the total is divided amongst 12.4 pe.- cent, of the taxpayers earning over £500 ; and 40 per cent, amongst the remaining 87.6 per cent, of the taxpayers. Those receiving more than £1,000 per annum constitute only 4.3 per cent, of the taxpayers, yet they receive over 40 per cent, of the total income. Passing to the incomes from property, 68 per cent, is received by those with incomes over £500 - although they number less than r7 per cent, of the taxpayers - while 32 per cent. " of the income is divided between 83 per cent, of the taxpayers. Interesting as these comparisons are, they do not arrest one's attention so forcibly as the meagre return which property apparently yields to its owners. We have seen that *Coghlan* estimates the capital value of land and improvements at nearly 684 millions, which, at 4 per cent., would give £27,360,000 annually. Does the discrepancy in the return of twenty and a-half millions in The annual revenue mean that three-fourths of the land and improvements earn nothing? Such an assumption is negatived by common knowledge. Or is it that ownership is spread over so many individuals that the income of each does not reach the taxable minimum? That theory is contradicted by the officially attested fact that 75 per cent of the adults ii. this community possess no property whatever. A more likely solution, I think, than any, lies in wholesale exemptions and gross under-valuations. {: .speaker-KDR} ##### Mr Ewing: -- Is the honorable member speaking of incomes? {: .speaker-KLB} ##### Mr MAHON: -- No, property. For instance, the annual rateable valueof land and improvements in Victoria in 1906 was £n.795,i43, yet its assessment for income taxation is. under three millions. From this it is clear that a tax on land and improvementsthroughout Australia, if based on that of Victoria, would permit five owners out of six to evade their liability to the community What emerges from a review of the position is briefly this : That a large majority of adults possess no property at all r that as to the remainder, those of small incomes are in vast preponderance; and that the lion's share of the wealth belong* to a very small group numerically. We have now to see in what proportion this group contributes to the fund from which its possessions are protected ; how much is paid by persons with small incomes, and next the part of the load borne by the unpropertied masses. It may be necessary to repeat here that mere poverty exempts no one from a contribution to revenue indirectly collected. Indirect taxation is a burden on consumption, and every one is a consumer ; while direct taxation is an impost on property. This- inquiry, therefore, involves an effort to trace the stream of Customs and Excise revenue to its source, in which admittedly little aid is to be had from our statistics. The contribution of each class to the- revenue has, however, been minutely and laboriously investigated in Great Britain. In 1882 a committee of the British Association found that 75 per cent, was the workingman's contribution to the revenue from beer and spirits. A later investigator, **Mr. Philip** Snowden, M.P., declares- that four-fifths- of the revenue from sugar, tobacco, coffee, *&c.,* are paid by the workers. It may be said that the conditions studied by these authorities differ greatly from those prevailing in Australia. That is quite true. Our wages and standard of comfort are, happily, higher than those in the Old Country. The incomes from winch **Mr. Snowden** and others draw conclusions do not permit of the outlay which the earnings of corresponding classes in Australia easily overtake. Nevertheless, although **Mr. Snowden's** estimate, when applied to Australia, is rather conservative, I propose to adopt it in regard to all commodities entering into general consumption. In the absence of reliable knowledge of the average wage of Australian workers, I am obliged to follow the Victorian Statist in placing all earnings under £500 per year in one group. My contention, then, is that the population of this group pays four-fifths of the total Tariff taxation on certain commodities, and three-fourths of the taxation on the remainder. For the year ending 30th June next, it is proposed to raise £11,040,711 through Customs and Excise, of which no less than £8,696,290 will be paid by people of moderate means, by wage-earners and persons having small and precarious incomes. Here is the estimate in detail : - The foregoing figures are submitted for criticism, and I shall be glad if honorable members will analyze the results for themselves. They will see that in fixing 20 per cent, as the contribution of wealth to our revenue, the case against its fortunate possessors has not been strained. Remembering that 92 per cent, of the breadwinners of Victoria earn less than £151 per annum, an even more startling disparity could have been shown had that percentage been applied to the total breadwinners of the Commonwealth. But I am content to display the anomaly in drab rather than in lurid colours. It can be summarized in a single sentence : A fraction of the people own four-fifths of the wealth and pay one-fifth of the cost of protecting it ; while the rest of the community, who possess only one-fifth of the wealth, carry four-fifths of the burden of its protection. Now, let us see what that burden is, and what it is likely to grow into. This year, it is proposed to vote £[1,094,097 for the general purposes of defence. To this total certain items must be added - £250,000 for harbor and coastal defence, and £55,000 for manufacture of equipment. If the cadet system expands as the Government profess to expect, the provision made for this part of the forces must be considerably augmented. We have heard also a good deal about an Australian Navy, or the nucleus of it, and this, too, calls for considerably more money than is allotted in this year's proposals. Then again, the Estimates should show a charge for interest on the cost of buildings and fortifications. It is a part of our expenditure, yet it is omitted from all calculations of the total cost of defence. *Cog/dan* estimates the cost of these works at £2,000,000, and adds that they were built mostly out of loan moneys. Apart from the items of cadets and ships, the real expenditure of the Department is now about £1,480,000 per annum. If the Government really intends to embark on a naval policy of any dimensions, its appropriation to that end must be vastly increased. Before we are aware of it, our outlay on defence will approach £2,000,000 per year ; it cannot be avoided, unless the assured increase on the naval side is balanced by reductions in the cost of land defence, which is very improbable. An outlay of £2,000,000 means a deduction of nearly 24s. per annum from each breadwinner in the Commonwealth. The office boy earning 5s. per week will give a month's pay to the fund. The farm labourer, the navvy, the miner, and the shearer will do five or six day's extra ploughing, delving and shearing to make up for their rich employer's evasion of his liability in connexion with the defence of his wealth. If any one of them were bluntly commanded to do this, he would probably revolt. Unless hard toil had ground the manhood out of him, he would assuredly resist any compulsion to make such a sacrifice of time or pay for this purpose. Yet, by indirect taxation, he finds, without a murmur, his considerable quota to the fund which protects the wealth of others. With him the antecedent condition is absent in the timeworn commonplace that " Where ignorance is bliss, ''twere folly to.be wise." In his case, ignorance is a calamity and folly a crime - a crime against himself and those dependent on him for subsistence. We shall probably hear, in the course of this debate, that the protection of wealth is only a subsidiary object in any scheme ot national defence; that nations equip ana maintain armies and armaments chiefly to preserve their national entity, their free institutions, and the lives and liberty of their citizens. " Is patriotism dead and pride of racial supremacy extinct?" is one of the indignant queries which one almost hears in anticipation from the Opposition benches. Those who favour this motion will be told that they take a sordid and mercenary view of an exalted ideal, under whose inspiration the ordinary man becomes a hero capable of deeds of deathless fame. No one who has watched the progress of a war-fever will under-estimate the potency of appeals addressed to the belligerent instincts and passions of men. The Spectator who retains his senses, however, detects their cynical insincerity. For instance, certain individuals are heard to declaim one moment that it is the common duty of every man, poor as well as rich, to defend the country at the risk of his life. Let a worker offer himself for- Parliament, however, and in the next breath these same gentry say, " Why should we elect this fellow - he has no stake in the country !" They are quite dogmatic about the duty of the worker to society " when the guns begin to shoot," but dubious whether he should enjoy certain privileges when all is plain sailing. Though good enough to fight for them, he is not good enough to legislate for them. The only place where they cheerfully acknowledge the equality of the worker is on the field of battle. For these reasons, one is inclined to suspect the sublime sentiment and exalted rhapsody which runs through these appeals to patriotism. It is vain to attempt to disguise the fact that, in any grave national emergency, wealth stands to lose much more than poverty. This fact is attested by the history of all warfare between nations. And while it is incontrovertible that citizenship carries with it the reciprocal duty of defending the State on the " tented field," with wealth still remains, and must remain, the obligation of supplying and maintaining all the other coefficients requisite for the dispersion of the nation's enemies. Now, on the ether side, one occasionally hears the remark that " the worker has nothing to fight for." With that, as a general proposition, I venture to disagree, though not violently. I think the Australian worker has a good deal to fight for, and it is the intention of the Labour Party that he shall have very much more. There is no need to enumerate here the advantages he possesses over his fellows in the Old World. But I do not vehemently dissent from the proposition, because it is conceivable that there are some honest men in this country who have reasonable grounds for adopting that view. Consider a case typical of the great industrial army - that of a man who, after long years of hard and poorly-paid toil, finds his powers waning. The needs of a family, illness, accident, or some other cause over which he had no control, may have prevented him from making any provision for old age. Or, take the man who trudges the streets of our cities, or tramps the plains of the interior, in quest of an elusive and precarious job. If, after reflecting on their position, these men were to conclude that they could not be much worse off were Australia a German or Russian possession, how should we show them to be wrong? Would honorable members convince them, by a declamatory recital of the blessings of free institutions, freedom of speech and action, liberty of the subject, and the rest: or would they suggest that membership in a world-wide Empire ought to compensate for a shortage of rations? These men would probably answer, presuming that they had patience to answer at all, that sentiment does not satisfy hunger, and that the free institutions which permit one man to amass a million while thousands alongside him remain all their lives plunged in penury, evoke no special enthusiasm. We must count on such views living and expanding while conditions of gross inequality^ are tolerated by society. If the worker is to feel that his country is worth fighting for, his country must see that he receives his rightful share of the wealth produced by his labour. His country must not tax him to protect property in which he possesses no share or visible interest. The larger reform is not for accomplishment to-day or next year ; but the minor one can be effected here and now by crystallizing into law the resolution which it is my privilege to submit. It is not a novel proposition, for I have shown that it is warranted by precedent. It is feasible and' practicable, since the aggregate wealth of the country is known and can be assessed for taxation ; and it is urgent because the removal of every wrong should not be delayed. I commend it to the favorable consideration of the House with the assurance that it satisfies the accepted canons of taxation, and complies with those elementary principles of justice! which should regulate the affairs of all civilized communities. Debate (on motion by **Mr. Johnson)** ad- 'journed {: .page-start } page 2058 {:#debate-8} ### COMMERCE (TRADE DESCRIPTIONS) BILL Motion by **Mr. Hume** Cook (for **Mr. Groom)** agreed to - >That leave be given to bring in a Bill for an Act to amend the Commerce (Trade Descriptions) Act 1905. Bill presented and read a first time. SUPPLY *(Formal).* Question - That **Mr. Speaker** do now leave the chair, and that the House resolve itself into Committee of Supply - resolved in the negative. {: .page-start } page 2058 {:#debate-9} ### MANUFACTURES ENCOURAGEMENT BILL *In Committee* (Consideration of GovernorGeneral's message). {: #debate-9-s0 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · Hume · Protectionist -- I move- >That it is expedient that an appropriation of revenue be made for the purposes of a Bill for an Act for the Encouragement of Manufactures in the Commonwealth. It is not necessary for me to speak to this motion, since we shall presently have the Bill itself before us. {: #debate-9-s1 .speaker-KCO} ##### Mr GLYNN:
Angas -- I do not know what position we shall occupy if we agree to this motion and proceed at once, as the Treasurer suggests, to the further consideration in Committee of the Bill itself. When the matter was under consideration some weeks ago, several honorable members were informed that they would have an opportunity in Committee to discuss the general principles of the measure, as if the second-reading stage had not been passed. I do not know whether they desire to avail themselves of that opportunity, but when the Manufactures Encouragement Bill was before us two or three years ago some considerations were adduced that it would be well to bring before honorable members before they record their votes. The bonus system was begun in Canada about 1884, and has been several times increased down to the present day. It was anticipated, when it was first started, that it would be in force for only about five to seven years, but at the expiration of the first period the bonuses were continued, and subsequently increased. In 1906. **Mr. Fielding,** a Minister, stated in the debate on the Budget, that they would have to extend the bonus system for at least four years longer. Apparently, this was because it had not been as successful as was anticipated within the temporary period. The experience of Canada is important, because we propose, by this Bill, to sanction the outlay, in a few years, of £304,000. {: .speaker-KIN} ##### Sir William Lyne: -- Does the honorable member desire to make a speech on the general question now ? I shall have to recommit the Bill in any case. {: .speaker-KCO} ##### Mr GLYNN: -- I do not want to speak at length, but a number of other honorable members desire to address themselves to the general question. {: #debate-9-s2 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · HUME, NEW SOUTH WALES · PROT; IND from 1910 -- If the honorable member will allow me to intervene, I wish to state that when the very question to which the honorable member is referring was raised, I said that if the rules of the House permitted, an opportunity would be given to discuss the Bill generally. I understood that an intimation to the effect that that opportunity would be given, came from the Chair. I do not know at what stage that would be ; but as I desire to amend several clauses, I shall have to recommit the Bill, and, I presume, a general debate could take place then, if the House so desired. I do not wish to go back on any promise I gave at that time, because it is not wise to attempt to rush the Bill through unduly, or without further debate. We reached a certain point at the end of last session, when a proposed amendment prevented the Bill from going further, but some of the clauses were not as well worded as I thought they should be, and I have had the opportunity of asking the Crown law officers to draft amendments, which will make the Bill much better and clearer. The general principle, however, has been debated so often that there cannot be much more to say about it, but if honorable members desire to say more, I have no objection, and shall do my best to secure for them that privilege. {: .speaker-K99} ##### Mr Johnson: -- We should have a quorum for the discussion of this measure. *[Quorum formed.]* {: #debate-9-s3 .speaker-KCO} ##### Mr GLYNN:
Angas .- On a motion to recommit the Bill, honorable members are confined to the particular objiects for which recommittal is sought. I do not think a debate on the general principles of the measure will be allowed at that stage. I know that some honorable members wish to debate the Bill generally, and my desire is that they should not be baulked of their opportunity. The Bill has been before us two or three times, and there was a fairly ample discussion on the second reading three or four years ago, but some honorable members, who are here now, had not the advantage of listening to the debates then, and, perhaps, may not have been able to look up the records in *Hansard.* It may be useful that a more condensed edition of the arguments presented before - with any novelty that a member of Parliament may be guilty of - should be brought to bear on the consideration of the measure now. I have stated what occurred in Canada - our great exemplar in this matter. The bonus there was 6s. 8d. per ton when **Mr. Fielding** spoke. In those circumstances, I ask the Committee to consider whether there will not be in a few years an obligation to add to the £304,000 that we are now asked to vote, and whether on the whole the prospects of the iron industry justify this fairly large outlay. A Committee sat upon the question of a bonus for the iron industry in 1901 or1902. The evidence showed that there were not verygreat deposits, within a commercial distance of the ports, of iron ore likely or certain to pay for working if the bonus was granted. There is iron all over Australia, but it does not follow that there are those huge, and conveniently situated deposits such as resulted in the! aggregation of large capital and wealth in America when inthe hands of some of the bigger commercial magnates there. {: .speaker-JUV} ##### Mr Mcwilliams: -- There is one in Tasmania. {: .speaker-KCO} ##### Mr GLYNN: -- Probably ; and the Iron Knob in South Australia is referred to as being practically a mountain of iron. The point is whether the deposits are near enough to coal, and to ports of export, and to the various industries in which iron will be used, to make the manufacture of pig iron commercially profitable. There is not the shadow of doubt that throughout Australia there is a sum total of iron deposits of a pretty large amount ; but that there is in any particular spot a vast deposit so placed as to be commercially very profitable is, on the report of the Commission, somewhat doubtful. It was also pointed out in evidence that the output in Australia must necesarily be small, because the consumption is not large. Evidence on that point was given by several experts, among them **Mr. Pearson,** of Gawler, now, I think, manager for Martin and Company, who stated that very few men would be required to turn out the amount of pig iron consumed in Australian manufactures. He added that through freight, wharfage, and other items, the industry had already a fairly large protection. If that is so, I fail to see how this sum is to result in a very large addition' to our manufacturing operatives. As against this, figures were brought to show what a great number of operatives were engaged in the iron industry, which includes manufactures. On that point, there is not a shadow of a doubt but in this connexion, we must consider only those directly connected with the manufacture of the particular articles placed in the schedule. The largest bonus is to be given for pig iron. Honorable members should consider what the prospects of the industry are, and what are the possibilities of consumption in our limited market of the few items in the schedule. Assuming that production soon outstrips consumption in Australia, what prospects are there of finding profitable markets elsewhere? With the honorable member for Denison, I say there are none. America is exporting large surpluses, and Japan has spent between £2,000,000 and £3,000,000 recently in establishing competitive works. Therefore, even if we are fortunate enough to have a large surplus for exportation, there is little chance of placing it at a profit either in the markets of the Old World or in what will perhaps be in the near future the wider fields of the New, among the Eastern races which arc now awakening from the commercial lethargy of centuries. Is our experience likely to be different from that of Canada? Canada has continued, indefinitely, a bonus that was put on for a short period. {: .speaker-JWY} ##### Mr Chanter: -- And built up a great industry. {: .speaker-KCO} ##### Mr GLYNN: -- Not through that. The *Canadian Year-Book* shows that there is a good deal of importation. {: .speaker-JWO} ##### Mr J H Catts: -- They have a duty as well. {: .speaker-KCO} ##### Mr GLYNN: -- They have a duty, and the proportion of their manufactures turned out from iron made from native ore does not at all attest the success of the industry. {: .speaker-K7U} ##### Mr Crouch: -- It is being fed almost entirely on the bonus. {: .speaker-KCO} ##### Mr GLYNN: -- That appears to be the case in Canada. When, with the tremendous expenditure that is likely to be before us in the next eight or ten years, we are asked, on the mere recommendation of a Minister, to sanction an initial outlay of about £304,000, we ought to consider the possibilities of success in view of the Canadian experience. {: .speaker-K7U} ##### Mr Crouch: -- The Japanese are living on their bonus also. {: .speaker-KCO} ##### Mr GLYNN: -- I have pointed out that Japan has started works which are likely to prevent the possibility of any export that we seek to establish going in her direction. I ask honorable members to look at the report of the Commission and the evidence. They will find that some manufacturers of iron do not regard the bonus at all favorably. They speak of the cost of the raw material, and the possibility of its being made greater, thus neutralizing the protection under the proposed system, because after a few years the bonus alone will not be the only protection given. There will be an import duty which will amount to a pretty substantial addition to the cost of production in our iron manufactures. {: .speaker-KNH} ##### Mr Mathews: -- And with possibly no increase in the import duty on the manufactured article. {: .speaker-KCO} ##### Mr GLYNN: -- There may not be, but, at all events, there will be an increase in the cost of the raw material of many industries. {: .speaker-KVJ} ##### Mr Storrer: -- They like protection for their own industries. {: .speaker-KCO} ##### Mr GLYNN: -- Manufacturers who wanted protection for their own industries gave evidence before the Tariff Commission disputing the expediency of the proposed bounty. Whatever may have been their impelling motive, it is not easy to set aside the logic of the figures which they adduced. They pointed out that the local consumption is comparatively small, that the establishment of a profitable export trade is practically impossible, and that, by reason of transport, wharfage, and other charges, the industry now enjoys considerable protection. {: .speaker-KEA} ##### Mr Kelly: -- Did they give similar evidence when asking for protection for their own industries? {: .speaker-KCO} ##### Mr GLYNN: -- I do not suppose so. The moment that you touch protection, you get an extraordinary conflict of opinions. However, although that may discount the authority of particular witnesses, it does not affect the force of their arguments. lt is to the logic of the figures adduced, not to the character of the witnesses - who, as citizens, I know to be beyond reproach and men of great ability - that I call attention. Their evidence led me in the first instance to oppose the proposal, and nothing has since come before me to affect my judgment in the matter. {: #debate-9-s4 .speaker-JWO} ##### Mr J H CATTS:
Cook .- We are asked to affirm the expediency of an appropriation for the purposes of a bounty on the production of iron, amounting to, I understand, about £30,000 a year. {: .speaker-KIN} ##### Sir William Lyne: -- Not exceeding £30,000 a year. {: .speaker-JWO} ##### Mr J H CATTS: -- On many occasions of late, grievous complaints have been urged against the administration of the Department of the Postmaster-General. From all parts of the Commonwealth comes the cry that urgent needs are not being attended to. We have heard even that business men cannot get connexions to telephone exchanges. When these complaints are voiced here, we receive but the one reply, continually reiterated, that there is not enough money to put matters right. Yet, although the fund at the disposal of the Government for the conduct of the services of the country is acknowledged to be insufficient, Ministers ask us to vote a bounty of £30,000 a year to benefit a wealthy private firm. {: .speaker-KXO} ##### Mr Page: -- I have known a man to buy ahouse just after going insolvent. {: .speaker-KEA} ##### Mr Kelly: -- Although the Government is supposed to be hard up, it has just bought a vacht. {: .speaker-JWO} ##### Mr J H CATTS: -- It is quite on the cards that, without most careful administration, there may be a shortage of money in connexion with very important commitments. I feel certain that the Treasurer has under-estimated the cost of a Commonwealth old-age pensions scheme. Of course, it may be possible to so administer the Act as to bring the expenditure within the limit he has set. down. But it must be remembered that, under the State Acts, married couples receive less than we propose to pay, and a number of restrictions are enforced which are not provided for by our Act. The Commonwealth Act is in no sense a pauperizing measure, and I hope that it will not be administered in a pauperizing spirit. {: .speaker-JUV} ##### Mr Mcwilliams: -- How much does the honorable member think is needed for a Commonwealth pensions fund? {: .speaker-JWO} ##### Mr J H CATTS: -- Between £1,800,000 and £2,000,000. {: .speaker-KXO} ##### Mr Page: -- According to the Treasurer, only £1,200,000 will be required. {: .speaker-KEA} ##### Mr Kelly: -- Does not the honorable member for Cook accept the Treasurer's figures ? {: .speaker-JWO} ##### Mr J H CATTS: -- No doubt the Treasurer can produce figures to support his estimate.; but I think that most honorable members are of opinion that if the Act is to be administered as Parliament intends, the cost will be more than £'£,200,000 a year. Should there be any shortage, duties on tea and kerosene will probably be proposed, the poor being taxed 011 the necessaries of life, to put money into the pockets of a firm which is well to do. {: .speaker-L1P} ##### Mr Wise: -- The ooor were not benefited by the remission of the duty on tea; it was the tea merchants who reaped the advantage. {: .speaker-JWO} ##### Mr J H CATTS: -- The honorable member has but little knowledge of economics, if he thinks that taxes can be imposed on the necessaries of life without making the lot of the workers harder. {: .speaker-L1P} ##### Mr Wise: -- The honorable member would vote to close down these iron works ? {: .speaker-JWO} ##### Mr J H CATTS: -- That is not my desire. The position I take is that, if the people of the Commonwealth are to be taxed to support this industry, they should enjoy the profits of it. {: .speaker-JWY} ##### Mr Chanter: -- Provision is made for that in the Bill. Either the State or the Commonwealth Government may ' at any time take over the industry. {: .speaker-JWO} ##### Mr J H CATTS: -- The Bill does not empower the Commonwealth to take over the industry. {: .speaker-K7U} ##### Mr Crouch: -- lt has not the constitutional right to do so. {: .speaker-JWO} ##### Mr J H CATTS: -- The Prime Minister, when Attorney-General in the Barton Administration, said that it has. {: .speaker-KFK} ##### Mr Groom: -- He said that the Commonwealth could control iron works only incidentally to the management of railways or the exercise of *some* corresponding power. {: .speaker-JWO} ##### Mr J H CATTS: -- The honorable and learned member for Flindershas given the deliberate opinion that the Commonwealth could nationalize the iron industry. {: .speaker-KVJ} ##### Mr Storrer: -- Is the honorable member alwavs guided by the opinions of lawyers? {: .speaker-JWO} ##### Mr J H CATTS: -- On constitutional points, I pay to them the respect that is due. Last winter the secretary to a relief society at Enmore, which is in my electorate, showed me a list of persons who had not enough blankets to keep them warm. I induced the State authorities to ask the police to investigate the matter, and they substantiated the representations made to me. The result was that blankets were supplied. Yet we are now asked to adopt a proposal which must inevitably result in further taxation on the necessaries of life of poor people such as these. {: .speaker-KEA} ##### Mr Kelly: -- Did the honorable member vote to increase the duty on blankets? {: .speaker-JWO} ##### Mr J H CATTS: -- That has nothing to do with this question. Blankets are cheap enough. These people could not afford them at any price. My point is that if a bounty is granted for the production of iron, it will be necessary to impose Customs duties on the necessaries of life in order to raise sufficient revenue. About 900 men are employed in the Lithgow works, of whom about half, according to the information I have received from a man who has worked there, will be affected by this proposal. About half of the men employed are engaged in working up scrap iron. {: .speaker-JWY} ##### Mr Chanter: -- According to the resident secretary, 600 men will be affected. {: .speaker-JWO} ##### Mr J H CATTS: -- I think about 500 men. A bounty of £30,000 would give them a little over £1 a week each. {: .speaker-JWY} ##### Mr Chanter: -- It would also give employment to thousands of others. {: .speaker-JWO} ##### Mr J H CATTS: -- I do not think so. I believe that if a meeting were held at Lithgow, the people there would vote for the nationalization of the industry rather than for a bounty. A workman coming from there informed me that, at the recent public meeting, only about sixty were present, and they were directly interested in this business. The case might be different if it could be shown that the firm which owns the Lithgow works has not sufficient money to carry on. {: .speaker-JRH} ##### Mr Bowden: -- It cannot be compelled to carrv on at a loss. {: .speaker-JWO} ##### Mr J H CATTS: -- No; but if it has faith in the industry, it may well be asked to put its ownmoney into it. {: .speaker-JRH} ##### Mr Bowden: -- It has put in £250,000. {: .speaker-JWO} ##### Mr J H CATTS: -- It can find the £30,000 proposed to be granted as a bounty. In my opinion, it is bluffing the Government and honorable members by the threat that the industry will collapse if a bounty is not paid. {: .speaker-L1P} ##### Mr Wise: -- **Mr. Sandford** came to the ground for want of assistance. {: .speaker-JWO} ##### Mr J H CATTS: **- Mr. Sandford** came out of the business with more money than he had when he went into it. {: .speaker-JWY} ##### Mr Chanter: -- **Mr. Rutherford** spent £70,000 in it. {: .speaker-KIN} ##### Sir William Lyne: -- £108,000. {: .speaker-JWO} ##### Mr J H CATTS: -- Why should not the present firm risk its own money, if a profit is to be made out of the industry? It wishes the Government to let it risk the people's money. {: .speaker-KEA} ##### Mr Kelly: -- Does not the honorable member desire to put the people's money into it? {: .speaker-JWO} ##### Mr J H CATTS: -- If the people get the benefits, but not otherwise. It cannot be imagined that the Hoskins Company have gone into this venture blindfolded ; and my own opinion is that they would be prepared to invest their own capital if the money were not provided by the Commonwealth. We cannot expect this or any other firm to refuse a bonus ; and we can easily imagine how the employes could be persuaded to attend public meetings, and give some colour to the threats to reduce wages and so forth. {: .speaker-JRH} ##### Mr Bowden: -- Messrs. Hoskins have put £250,000 into the industry. {: .speaker-JWO} ##### Mr J H CATTS: -- Then why is it desired that the Commonwealth should pay £30,000 a year? If the firm had come to us, and said that they had put their all into the industry, and were likely to fail, there mightbe some justification for the present proposal. As a matter of fact, however, fhey have ample money, and either they have no faith in the industry, or they refuse to invest their own, evenwhen they know there will be an ample return. The honorable member for Nepean has spoken more than once of the needs of the postal service ; and I ask him now whether that service ought to be neglected in order to pay Messrs. Hoskins this subsidy ? {: .speaker-JRH} ##### Mr Bowden: -- I do not say that the subsidy will go to Messrs. Hoskins, or that the postal service ought to be neglected. {: .speaker-KEA} ##### Mr Kelly: -- The honorable member for Cook has said that the finances are satisfactory. {: .speaker-JWO} ##### Mr J H CATTS: -- I said nothing of the kind. {: .speaker-KEA} ##### Mr Kelly: -- But the honorable member voted that way. {: .speaker-JWO} ##### Mr J H CATTS: -- The honorable member knows perfectly well that the motion of no-confidence was a mere " put- up- job " to bring the direct Opposition and the Opposition corner together. It will be remembered that the leader of the Opposition saidthathe could not expect the Labour Party to vote for the motion, and, therefore, he appealed to the Opposition corner. {: #debate-9-s5 .speaker-10000} ##### Mr CHAIRMAN: -- I must ask the honorable member not to pursue that line of argument. {: .speaker-JWO} ##### Mr J H CATTS: -- Quite so, **Mr. Chairman** ; my only justification is that honorable members of the Opposition have a little " gag " which they try to introduce on all occasions. First of all, I say that Messrs. Hoskins have the money to put into this industry. {: .speaker-JRH} ##### Mr Bowden: -- What is the honorable member's authority for that statement? {: .speaker-JWO} ##### Mr J H CATTS: -- My authority is the fact that Messrs. Hoskins have not said the contrary ; and the honorable member in his heart knows that the firm do possess the money. {: .speaker-JRH} ##### Mr Bowden: -- I know nothing at all about Messrs. Hoskins' financial position. {: .speaker-JWO} ##### Mr J H CATTS: -- It is not as though Messrs. Hoskins had been in this industry for many years. When **Mr. Sandford** showed that he was not able to conduct the industry successfully, Messrs. Hoskins invested their money, knowing all the circumstances and taking all the risks. {: .speaker-JRH} ##### Mr Bowden: -- Does the honorable member not think that Messrs. Hoskins proved their *bona fides* by investing £250,000? {: .speaker-JWO} ##### Mr J H CATTS: -- Certainly, and that is why I contend that they will invest their money in the industry if the request for a bonus is refused. At any rate, we can well understand that people so deeply interested ab they are will not run the risk of a closing of the works for the sake of £30,000 ayear. {: .speaker-L1P} ##### Mr Wise: -Why did Sandford shut down if the business is so successful? {: .speaker-JWO} ##### Mr J H CATTS: -- The honorable member will have an opportunity to address himself to the question, and, in the meantime.I do not think it is fair that I should be subjected to this running fire of interjections. {: .speaker-L1P} ##### Mr Wise: -- But the honorable member is instructing us ! {: .speaker-JWO} ##### Mr J H CATTS: -- I should say that, from all appearances, no one could instruct the honorable member in anything. The firm in question has money, and they ought to be prepared to invest it if they have any faith in the future of the industry. In any case, if their faith is weak, why should we be called upon to invest the people's money ? A further fact is that this firm, to whom it is proposed to give £30,000 a year, is already subsidized by the State Government, not in money, but in kind, seeing that their goods are carried on the railways for next to nothing, and that they earn big returns from Government contracts. The report signed on behalf of the delegates of the Lithgow Ironworkers' Association states that the New South Wales Government are avowedly anxious to see the industry well established, and will undoubtedly grant special railway concessions and favorable contracts for the supply of railway material. {: .speaker-L1P} ##### Mr Wise: -- I thought the honorable member said that the employes would do anything their employers told them to do ! {: .speaker-JWO} ##### Mr J H CATTS: -- I said nothing of the kind. I should like to know what the assistance rendered to this firm by the New South Wales Government means in actual cash. The firm are getting a considerable advance on contract prices, and, as I have already said, concessions in regard to the charges for the carriage of their ores and iron. {: .speaker-JWY} ##### Mr Chanter: -- Concessions are also given to other industries. {: .speaker-JWO} ##### Mr J H CATTS: -- But not to the same extent. {: .speaker-JRH} ##### Mr Bowden: -- The concessions are on account of the bulk of the stuff carried. Messrs. Hoskins pay £55,000 . a year in freights. {: .speaker-JWO} ##### Mr J H CATTS: -- If so, then Messrs. Hoskins get more than an equivalent from the public on the price of their iron. What this firm really wants the Commonwealth to do is to provide them with a working profit ; and if we grant the bonus there will certainly be clamour for further payments in the future, if we may judge from the experience in Cinada. Of course, it is a rather peculiar position I find myself in. We support the Government, and keep them in power for a certain time, and then they bring down measures to which we absolutely object ; and, when we fail the Government, they turn to the Opposition, who come to the rescue. {: .speaker-KEA} ##### Mr Kelly: -- Why so jealous of those supporting the Government? {: .speaker-JWO} ##### Mr J H CATTS: -- I am not jealous, but I know that, where the money of the working classes is concerned, we shall find the conservative elements of the House coming together. If the Government were to propose a duty on iron, I should support it, in preference to a bonus, because a duty is paid, if it influences prices, by the people who use the material, whereas a bonus means the levying of taxation on the necessaries of life of working men and women. {: .speaker-KEA} ##### Mr Kelly: -- I thought that the honorable member, as a protectionist, held that the duties are not borne bv the people. {: .speaker-JWO} ##### Mr J H CATTS: -- No doubt the honorable member thinks a great many things. {: .speaker-KEA} ##### Mr Kelly: -- I wish I could say the same of the honorable member ! {: .speaker-JWO} ##### Mr J H CATTS: -- But most of the thoughts of the honorable member mean nothing. He has never heard me say that I am a protectionist ; and, as a matter of fact, I have voted for duties in some instances on the new protection basis. {: .speaker-KEA} ##### Mr Kelly: -- New protection which the honorable member has not got ! {: .speaker-JWO} ##### Mr J H CATTS: -- And which we shall never get, if the honorable member has his way ; the honorable member takes good care that, so far as he is concerned, the working men shall have no advantage. There are great national undertakings in front of us, necessitating large expenditure; and, although, at the present moment, the public are not getting those services which we have contracted to give them, it is proposed to vote £30,000 per annum to a wealthy firm. By the imposition of a duty we should be able to exercise a more effective control over the industry than would be possible if a bounty were granted. With the passing of the new protection proposals of the Government we should be able to determine the maximum prices at which iron and steel should be sold and to fix the minimum wages to be paid in the industry. Some of the Conservative members of the House seem to be amused at that statement. They desire absolute freedom of contract, and do not believe in the regulation of prices. {: .speaker-JWY} ##### Mr Chanter: -- Provision is made in the Bill for the payment of fair wages in the industry. {: .speaker-JWO} ##### Mr J H CATTS: -- But we are not likely to obtain for the workers in the industry the measure of protection that would be secured to them in the circumstances I have indicated. {: .speaker-JWY} ##### Mr Chanter: -- If fair wages were not paid the bounty would be withheld. {: .speaker-JWO} ##### Mr J H CATTS: -- We had a practically similar statement with regard to what would be the position of the workers in the agricultural implement-making industry under the Excise Tariff (Agricultural Implement) Bill, but we know that our efforts in that connexion failed. The Government did not exercise any great anxiety in that aspect of the matter. {: .speaker-KXO} ##### Mr Page: -- That was a different matter. The honorable member has already explained the difference between a bounty and a duty. {: .speaker-JWO} ##### Mr J H CATTS: -- In reply to the honorable member for Maranoa, I would say that I have never made a hostile interjection whilst a member of our party has been addressing the House, and I regret that we cannot give expression to our views on matters outside the party platform without some of our colleagues making an attack upon us. A proposal to give to those who already have more than enough £30,000 per annum obtained from the workers of Australia meets with no opposition from the Conservative members of the House. They do not seem to be prepared to seriously consider an objection to such a scheme. Before long we shall probably be asked to put duties on tea and kerosene and to pay away the revenue so obtained to those who already have more than they need. When the last Bounties Bill was under consideration the financial position of the Commonwealth was not that which now confronts us. The position today is altogether different. {: .speaker-K5J} ##### Mr Coon: -- Is that why the honorable member is opposed to this Bill ? {: .speaker-JWO} ##### Mr J H CATTS: -- That is an additional reason why I am opposed to it. On behalf of the electors who returned me to this House I offer the most vigorous protest of which I am capable against the passing of a measure under which £30,000 per annum will be taken from the revenue obtained largely from the workers and distributed amongst men who already have more than enough. {: #debate-9-s6 .speaker-JWY} ##### Mr CHANTER:
Riverina .- I do not think that the honorable member who has just resumed his seat has given this question the consideration it deserves. {: .speaker-JWO} ##### Mr J H Catts: -- Having spoken on it before, I did not wish to go into every detail. {: .speaker-JWY} ##### Mr CHANTER: -- Quite so. I merely suggest that the honorable member does not appear to have given to the history of this movement in Australia the close attention that it deserves. It is well known that several attempts which have been made to establish the iron and steel industry in Australia without Government assistance have absolutely failed. The people of that section of the Commonwealth which I have the honour to represent have considered the question of whether it is desirable that the work of establishing the industry should be speedily undertaken, and have authorized me to give an affirmative answer. We have now to consider what are the best means to adopt. Some of my honorable friends of the Labour Party agree with me that the industry should be established as soon as possible, but I think that it should be entirely under Government control. {: .speaker-KNH} ##### Mr Mathews: -- They think that that is the only effective control. {: .speaker-JWY} ##### Mr CHANTER: -- One answer to that contention is that we have no power to nationalize the industry. The States mav do so, and under this Bill it will be open to the State in which ths industry is established within twelve months of the cessation of the bounties to nationalize it. Having regard to the experience of those who have endeavoured, without Government assistance, to establish the industry on a firm basis, have we any reason to believe that others will be prepared to sink their money in a similar venture? But if, as the result of the granting of a bounty, it is established on a reasonably sound basis, we shallbe able to take further action. That stage having been reached, there will be no necessity, as was suggested by the honorable member for Cook, to continue the payment of the bounty. The object of a bounty is to enable the local producers to gain control of the home market. The industry having been firmly established, commercial associations would be formed to enable it to compete in the local market with iron productions from abroad. But what has been our experience? The moment a local iron and steel manufacturer has been able to put his products on the market, a ring has been formed in the importing interests, " and prices have been reduced to such a level as to render it impossible for him to pay reasonable wages and carry on. Having in this way succeeded in crushing the local industry, the importers have once more put up prices. The tree that we are seeking to plant today needs to be watered and guarded very carefully if it is to grow and flourish. Once it has become well-rooted, the watering, or in other words, the payment of the bounty, may cease. We shall then be able to impose aduty such as we have imposed to assist other industries. The honorable member for Cook said that a duty on iron and steel would be borne only by the users, whereas the cost of the bounty would be borne by the people generally.I should like to ask him whether' the users are not the great body of the people of Australia? {: .speaker-JWO} ##### Mr J H Catts: -- Not necessarily. {: .speaker-JWY} ##### Mr CHANTER: -- The bulk ofour people are interested in the iron and steel industry, and those industries which are dependent upon it. We annually import something like £8,000,000 worth of iron and steel, and manufactures of which they form a part, so that the question that we have now to consider has a wider significance than the honorable member for Cook would have us believe. It does not relate solely to the few hundred workers who have been employed in the iron works at Lithgow. {: .speaker-JWO} ##### Mr J H Catts: -- They would reap the immediate benefit of a bounty. {: .speaker-JWY} ##### Mr CHANTER: -- Certainly ;but tens of thousands of others would also be benefited. Those who have invested their money in this industry ask that they shall receive some assistance at the hands of the Commonwealth, and they have as much right to ask for it as had many other manufacturers who have secured it at our hands. The only way in which we can assist them at the present timeis by granting a bounty. The imposition of a duty before the establishment of the industry would fall directly upon the users of iron and steel, since there would be no local competitive influence to check the price of imports. In years to come, as the result of the payment of this bounty, we shall have created that competitive influence, and it will prove an effective check on the prices charged for iron and steel from abroad. In dealing with a question of such magnitude, we ought not to consider whether, as the result of the passing of this Bill, we are likely to have one post-office or one telephone exchange less than we ought to have. The Commonwealth is not insolvent. {: .speaker-JWO} ##### Mr J H Catts: -- But the Public Service is starved. {: .speaker-JWY} ##### Mr CHANTER: -- I know that there are individual cases of hardship, but the Public Service of the Commonwealth may trust to the wisdom of this Parliament to remove its grievances. It can rest assured that it will receive at the hands or the Government as much consideration as it is possible for any Service to get. I would remind honorable members that, with the adoption of the Naval Defence policy put forward by the Government, we shall be building our own warships, and shall need an unlimited local supply of iron and steel. The industry is intimately connected with our military services and our commercial and domestic requirements throughout the Commonwealth. Can the honorable member for Cook point to any country in the world that has established an iron and steel industry without assistance at some time or other from the Government? It has been tried, but has not succeeded. We are working now in the light of experience. In New South Wales the Government had to assist to place the industry on a sound foundation. The experience of Canada has been quoted, but there would not be the slightest chance in the Canadian Parliament of discontinuing the bonus, if it were known - as it is known by the Canadian authorities - that without it the industry would stop, and their iron and steel would have to be imported. They know that it is a national requirement, and will willingly go on paying the bonus even if they have to do so to the end of time, because it is in the interests of the nation as a whole, as well as of individuals. The Australian iron industry will not be confined to Lithgow, in New South Wales. This is not a bonus to Hoskins Brothers only. It was proposed in this House before Hoskins was heard of. {: .speaker-JWO} ##### Mr J H Catts: -- For the same firm. {: .speaker-JWY} ##### Mr CHANTER: -- Years ago another firm was waiting for the passage of this Bill to establish worKS in Sydnev and Tasmania. Land was bought on Lane Cove River, where it was intended to put down the works and import the ore from Tasmania. {: .speaker-JWO} ##### Mr J H Catts: -- Lithgow can turn out all the iron required in the Commonwealth. {: .speaker-JWY} ##### Mr CHANTER: -- I hope the honorable member will enlarge his ideas. The Commonwealth is not going to stand still. We hope to see it grow in population and requirements, and industries not only established at Lithgow but dotted all over the continent. Where we have iron ore in one place, we have coal in another, and we shall soon get a commercial combination that will bring about the production of pig iron if we give the necessary assistance. If we give no assistance, we shall have no iron and steel industry. {: .speaker-KXP} ##### Mr Palmer: -- What State assistance has already been given to the industry? {: .speaker-JWY} ##### Mr CHANTER: -- It has been assisted by the New South Wales Government guaranteeing a certain price for Government contracts. {: .speaker-JWO} ##### Mr J H Catts: -- And by cheap freights. {: .speaker-JWY} ##### Mr CHANTER: -- The New South Wales Railway Department has given the manufacturers of iron and steel at Lithgow simply the same freight reductions as have been given to pastoralists, farmers, and other producers. The railway authorities recognise that it would be a calamity to lose the iron and steel industry. {: .speaker-JWO} ##### Mr J H Catts: -- The industry is now given greater concessions than are given to farmers and pastoralists. {: .speaker-JWY} ##### Mr CHANTER: -- A return quoted this afternoon by the honorable member for Werriwa shows the traffic receipts on the railways for passengers and freights, and I venture to say that if the honorable member for Cook compares the rates he will find that other industries get even cheaper carriage. We ought not to regard this question from the stand-point of whether we can afford the money. Surely the Commonwealth is not so low down in the financial scale as to be unable to afford £30,000- a year to build up a great national enterprise. If the amount were ,£60,000, I would give it my vote and heartiest support. If there is one industry more than another that should receive the assistanceof the Commonwealth Parliament itis the manufacture of iron and steel,, which is the basis of every other industry. If the States will not assist it, we must do so. When **Mr. Kingston'sBill** was before the House, the States wereappealed to, and almost pleaded with, totake over 'the industry and get the bonusthemselves, but for financial or other reasons they would not or could not do so. We have lost six or seven years of valuable time, and we have no industry whatever. I trust that honorable members whowant the industry nationalized will recognise that there is a provision in the Bill permitting the State Government to take over the works at any time, under specified conditions. Let us give the industry a start now. Let Parliament show that it, *bond fide,* wants the industry established, and* the great heart of the people of Australia will agree that it never did a wiser or safer thing than in starting this great enterprise. {: #debate-9-s7 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · Hume · Protectionist -- I had hoped that there would not be a long discussion on this motion, because the Bill, although not quite in its present form, has a long history. A great many opinions have been expressed, and speeches made, upon "it. The first Bill was introduced in May, 1902, by **Mr. Kingston.** It was referred to a Select Committee, but the report was not submitted to Parliament. The Bill lapsed at the prorogation. The next Bill was introduced in March, 1904, by myself. Owing to changes in the Ministry the debate was not continued until the close of the year. It was taken into Committee, but lapsed at the prorogation. The third Bill was introduced in 1905, but a point of order was taken by the deputy leader of the Opposition, and another Bill had to be brought in. This was negatived in the Senate by one vote. It passed this House by a large majority, and its loss in the Senate was owing to the temporary absence from the Chamber of two members who were favorable to it. {: .speaker-JWO} ##### Mr J H Catts: -- It will be lost in the Senate again. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- It will be lost anywhere if the honorable member has his way. In November, 1907, a similar Bill was brought forward, with the addition of the item " wire netting." The debate was continued in June, 1908, but there was no time to get the Bill through. That is the Bill that has now been reintroduced, and is under discussion. There has been a debate on every occasion, and I had hoped that by this time it would be short; but I feel bound to show that the position taken up by the honorable member for Cook is not correct, and that it will be a calamity if the Bill does not become law. {: .speaker-JWO} ##### Mr J H Catts: -- Has the Treasurer money enough for the Post and Telegraph Department ? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Yes, plenty. If the Post and Telegraph Department looks after its own affairs, and does as a private firm would do, it has plenty of money at present; but, of course, we have to find more and more each year. {: .speaker-JWO} ##### Mr J H Catts: -- Is there enough for this year's requirements? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I have not the slightest doubt there is ; there is also plenty of money for the purposes of this Bill.I intend to propose several amendments. {: .speaker-KGZ} ##### Mr Hedges: -- I hope the honorable member will strike out " wire netting." {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I do not propose to do anything of the sort. {: .speaker-KGZ} ##### Mr Hedges: -- Then we shall have to do it for him. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I am satisfied that the honorable and unprogressive member will kill the Bill somehow, if he can. {: .speaker-KFJ} ##### Sir John Forrest: -- That is not fair ; he is for the Bill, but he is not in favour of a bountv on wire netting. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Put it out, and put the Bill out. In the first place, I shall have to extend the time for another year in each case, and I would take out of clause 6 the words " reapers and binders made after the 31st day of December, 1910." I propose to insert a second subclause at the end of clause 7, providing that - >No bounty shall be authorized to be paid directly or indirectly to any State or any authority constituted under a State. The reason for that is that an arrangement was made by the New South Wales Government with **Mr. Sandford,** by which he received some consideration, the State taking his iron at a certain price, while he was to hand over to the State any bounty received. That is not proper, and I do not think we should pay the bounty to a State. {: .speaker-JWO} ##### Mr J H Catts: -- Not if the State conducts the business? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Not even if the State owns it. Why should the Commonwealth pay a bonus to a State? If the State is going to do the work, let it do so on its own account. I intend to insert a new clause, 10 a, to deal more effectively with rates of wages. I did not like the clause previously agreed to. It was a provision which was drafted hurriedly, and I_ think that this, which I propose to substitute, is an improvement upon it - 10A. (1) The person claiming any bounty under this Act shall, in making his claim, certify to the Minister the rate of wages paid by him to employes in connexion with the manufacture of the goods on which bounty is claimed. {: type="1" start="2"} 0. If the Minister finds that the rates of wages, or any of them, are below the standard rates prescribed by any Commonwealth or State industrial authority, or, in the absence of any such standard applicable to the goods, are below the standard rates paid in the locality in which the goods are manufactured, the Minister may withhold the whole or any part of the bounty payable. {: .speaker-KNH} ##### Mr Mathews: -- The Minister knows that that provision is unconstitutional. {: .speaker-KFK} ##### Mr Groom: -- It is not unconstitutional. {: .speaker-KNH} ##### Mr Mathews: -- Then why was not a similar provision adopted in connexion with the new protection legislation? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- This is quite a different matter. The honorable member for Cook said that the iron deposits are not sufficiently large. {: .speaker-JWO} ##### Mr J H Catts: -- I did not say that. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I understood the honorable member to say that our iron deposits are not sufficiently large to justify the granting of a bounty, and the honorable member for Riverina referred to what had been done in connexion with the Tasmanian deposits. {: .speaker-JWO} ##### Mr J H Catts: -- What I said was that one company could turn out all the iron required by the Commonwealth. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- In addition to the New South Wales deposits, there are very extensive and very rich deposits in Tasmania. In fact, there is only one mine in the world known to be richer than the Blythe River mine. In South Australia there is at least one rich field, and probably more. {: .speaker-KGZ} ##### Mr Hedges: -- There is also iron in Western Australia. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Yes. No country contains better supplies of, iron ore than does Australia. {: .speaker-KYT} ##### Mr Knox: -- Iron ore is to be found in every one of the States. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Yes. As to the objection that this is a proposal to grant a bounty of which only one firm can take advantage, I would point out that, asthe honorable member for Riverina mentioned, the bounty was proposed long before the present firm came into existence. {: .speaker-JWO} ##### Mr J H Catts: -- The present works were then being controlled by another firm. The concern has simply changed hands. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- The iron industry of Australia was founded by **Mr. Rutherford** thirty or forty years ago. He sank £108,000 in his enterprise, and when he went to Sydney to try to sell his iron the importers formed a ring, and determined to undersell him by £2 a ton. He was a fighting man- I am glad to say that he is still alive - but he was ultimately compelled to close his works. {: .speaker-JWO} ##### Mr J H Catts: -- The same thing could happen again, even if the bounty were given. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I do not think so. **Mr. Sandford** continued the work done by **Mr. Rutherford,** and, although he battled hard, was not successful, probably for want of sufficient funds. The present company has shown its *bona fides* by investing over £200,000 in the business. According to a report furnished by **Mr. Allard,** at the instance of the New South Wales Government, it loses 3s. a ton on its output of iron. I am informed that yesterday, in connexion with a contract invited by South Australia, the Lithgow firm tendered at 82s. a ton, and was beaten by an English firm tendering at 65s. As nearly all the iron imported is carried free, as ballast, the outside competitors of the firm have nothing to pay by way of freight. At the present moment there are 500 tons of iron in vessels in the port, brought here as ballast. This competition takes the heart out of local manufacturers, who cannot compete against the rings which are formed against them, or the cheapness which has resulted from the depression in the iron trade abroad, particularly in Great Britain. {: .speaker-JWO} ##### Mr J H Catts: -- The granting of the bounty will not affect the competition of the rings to which the Minister refers. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I think that it will. It is not intended that this bounty shall go to one. firm. The Government may make grants to three or four firms. {: .speaker-JWG} ##### Mr Fowler: -- Does the Treasurer anticipate that more than one firm will apply for assistance? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Yes. I believe that a company will be formed to work the Blythe River deposits. If I had money to invest, I would put it into such a concern. There is also a South Australian mine, which is likely to be worked. The object of the bounty is to induce other companies to start. In Canada the granting of bounties has brought about the establishment, not of three or four, but of many iron works. At the present time there are 1,000 men employed in the Lithgow iron works, the wages paid to them amounting to £106,000 per annum, while the payments to the Railways Commissioners of New South Wales total £56,000. The cost of producing pig-iron is almost wholly made up of expenditure on wages. In England, pig-iron costs 42s. a ton to produce, and, at Lithgow, 70s. a ton, the difference being almost entirely due to the difference between rates of wages. In England, the wages cost of production is 8s. 9d. per ton, and at Lithgow, 19s. a ton. The output of the Lithgow works during the last twelve months was 30,000 tons of pig-iron, and 10,000 tons of bariron and steel, while **Mr. Allard** computes the loss suffered by the company during that period at £15,764, or an average of 3s. a ton. He further says that, in his opinion, the charge for depreciation is inadequate, and that the net loss is, therefore, substantially more. I know **Mr. Allard** to be a capable and very careful man. His report was made to the order of a Judge of the Supreme Court. The Lithgow Ironworkers' Union, and the Esbank Ironworkers' Association, both support the Bill. Their members have expressed a determination not to accept any reduction in wages. {: .speaker-JWO} ##### Mr J H Catts: -- It was to be expected that they would support the Bill. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- If the underlying principle of the measure were a bad one, they would not be swayed by personal considerations. {: .speaker-JWO} ##### Mr J H Catts: -- Does the Treasurer think that they would oppose a measure which means the spending of more money in Lithgow? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I think that they would be honest enough to do so, if the principle of the measure were wrong. {: .speaker-JWO} ##### Mr J H Catts: -- There is no question of honesty. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- If the works are to be kept going, a bounty must be granted, or there must be a reduction in wages, which the men say they will not accept. The proprietors of the works have been perfectly open. They asked that their affairs should be investigated, and I have given the substance of the report of the expert who made the investigation. They naturally say, " Seeing that we are losing heavily, we cannot keep going without reducing wages.'' Mr.J. H. Catts. - The expert's report has not yeT been criticised by the body investigating the matter.It is based on information supplied by the bookkeepers of the firm. {: .speaker-KIN} ##### Sir WILLIAM LYNE: **- Mr. Al** lard is an honorable man, who would not accept incorrect information. {: .speaker-JWY} ##### Mr Chanter: -- What he says is corroborated by the threat to close down the works. {: .speaker-KZG} ##### Mr Roberts: -- That is only suggested as a possibility. {: .speaker-KW8} ##### Mr JOHN THOMSON:
COWPER, NEW SOUTH WALES · PROT; LP from 1910; NAT from 1917 -- What is **Mr. Allard's** opinion as to the quality of the iron? {: .speaker-JWO} ##### Mr J H Catts: -- I understand that **Mr. Allard** is an expert accountant, not an iron expert. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- No doubt, he obtained reliable information regarding the quality of the iron. The State Government has repeatedly sent experts to the works, and they have pronounced the iron produced to be of the best quality. In certain cases it is too good for ordinary commercial use. Any one is at liberty to go and witness the tests, which are of the highest character. One great reason whv this industry should be promoted is the absolute necessity, in view of our defence proposals, of having the means of providing our own munitions of war. I am not at all opposed to the Government undertaking this industry, and would be glad if an amendment of the Constitution could be made to enable that step to be taken. In any case, this enterprise ought to be pushed on ; and enthusiasm for little fads in one direction or another should not be allowed to stand in the way. . And as the representative Parliament of Australia we ought to give a lead. I regard it as an absolute disgrace that this matter should have been delayed for so long. I may say that when rifles were wanted for the South African war, none could be obtained for NewSouth Wales until the war was over, and this only shows the absolute necessity for the establishment of the iron and steel industry in Australia. I can hardly think that the honorable member for Cook has any idea of what the importations are. I have before me the import returns of iron and steel manufactures into Australia for the past four years,; and for purpose of analysis, I have divided them into three classes - (1) Raw or partly manufactured iron and steel ; (2) Manufactures of iron and steel ; (3) Machine and machinery. The figures are as follow; - >Value of imports of iron and steel, raw or partly manufactured - 1904, £1,583,521 ; 1907, £2,674,388 - an increase of over £1,000,000, or over 67 per cent. > >Value of imports of iron and steel manufactures 1904,. £3,675,651; 1907, £5,795,518- an increase of over £2,000,000, or over 58 per cent. > >Value of imports of machines and machinery - 1904, £1,623,867; 1907, £2,868,535- an increase of over £1,000,000, or over 75 per cent. > >The total value of imports of iron and steel and manufactures thereof - 1904, £6,883,039; 1907,£11,338,441 - an increase of nearly four and a half million pounds, or over 64 per cent. Of this £11,338,441 worth, 61 per cent. comes from the United Kingdom, about 20 per cent, from the United States and Canada, about 13 per cent. from Belgium and Germany, and about *6* per cent. from other countries. Tne table proceeds - >During the period under review (1904 to 1907)- the imports of wire have increased over 80 per cent. in value; the imports of pipes and tubes have increased over 100 per cent. in value ; the imports of bolts and nuts have increased over 100 per cent, in value ; the imports of axles and springs have increased over 100 per cent. in value ; the imports of rails and railway material have increased over 300 per cent. in value ; the imports of wire netting have increased over 400 per cent. in value. > >The weight of imported iron and steel, raw or partly manufactured, was, in 1904, 3,311,039 cwts., and in 1907, 5,041,050 cwts., an increase in weight of 87,000 tons. > >The weight of the imports in iron and steel manufactures and in machines and machinery cannot be ascertained, but the above figures will show the enormous expansion which has taken place in this class of imports. Comparison between quantity of Australian iron and steel produced and the quantity imported : - The Lithgow Works produced in 1907 40,000 tons of iron and steel. During the same year we imported over 252,000 tons of raw iron and steel, besides eight and a half million pounds worth of iron and steel manufactures. ; That is the position, and it is an impotent one. Let us get to work. The industry can be taken over by the Government at any time. {: .speaker-KZG} ##### Mr Roberts: -- Not at any time. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Yes; after a certain number of years. *Sitting suspended from 6.30 to 7-45 p.m.* {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I do not want to unduly extend my remarks, but this matter is so important that it is well to give all the information available on the points which, have been raised in the debate. I have now particulars of what has happened in Canada, and they are as follow : - >In 1883 the Canadian Government introduced the system of bounties at the rate of 6s. 2d. per ton on pig-iron, irrespective of origin of ore. > >In 1890 this was reduced to 4s. 2d. per ton, but was increased to 8s. 3d. per ton in r8g3. > >In 189S it was decided to make the bounty 12s. 4d. on iron made from Canadian ore, and at the same time to give a bounty of 8s. 3d. per ton of iron made from imported ore. > >In 1903 the bounties were reduced to irs. id. and 7s. 5d. respectively. > >In 1904 they were 9s. 3d. and 6s. 2d. respectively. > >In 1905 they were 6s. gd. and 4s. 6d. respectively. > >In 1906 they were 4s. 4d. and 2s. lod. In 1907 an Act was passed fixing the bounties as follows : - 1907 and 1908 - 8s. 8d. per ton on iron from Canadian ore; 4s. 6d. per ton on itoh from imported ore ; 1909 - 7s. and 2s. lod. respectively. 1910 - 3s. 9d. and is. Sd. respectively, after which time it is expected that the bounties will cease. > >The duty ou imported pig-iron into Canada is 10s. 3d. per ton, with a preferential duty to Great Britain of 6s. 2d. per ton. _ The total amount paid in bounties on pig iron since 1883 is £1,097,600. {: .speaker-KW8} ##### Mr JOHN THOMSON:
COWPER, NEW SOUTH WALES · PROT; LP from 1910; NAT from 1917 -- Is the diminishing bounty in view of the protective duty? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I do not know, but the fact remains that production has increased immensely in Canada; and, possibly, the industry is now on such a basis as not to require as much assistance as formerly. The information I have proceeds - >The United States duty on imported pig-iron is 16s. 6d. per ton, with a duty on steel of from 18s. 8d. up to £1 7s. 6d. per ton. {: .speaker-JWG} ##### Mr Fowler: -- That is what made the fortunes of Carnegie and other millionaires. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- While most people are opposed to industries of this kind having too great a dominating power, we find that the iron manufacturers of the United States are able not only to supply all the requirements of that country, but to undersell Great Britain in steel rails. {: .speaker-JWG} ##### Mr Fowler: -- Quite so ; on account of the prices obtained inside of the United States {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Then there is the other advantage that both Canada and the United States are able to produce their own defence materials, and that is one of the reasons why we should sink all differences, and deal with this question from a patriotic stand-point. My information proceeds - We have thus examples of countries, with raw material in no greater abundance than we have; and all of the facts show the necessity of our not permitting this question to drift any longer. The production of steel has increased in a similar way, and the industries working in these metals show a corresponding progress. Canada's output of pig-iron when the System of bonuses was introduced into that country, was the same as the output of the Lithgow Ironworks during the past year, namely, 30,000 tons. In 1906 Canada produced over half a million tons, and Australia has all the natural advantages and facilities to break that splendid record, as Canada had the United States on her very threshold as a competitor for her trade. I now desire to give one or two extracts from an article in the *Canada's Century,* by **Mr. Barrett,** F.R.G.S.- >Not many years ago Canada was entirely dependent for the supply of her requirements in iron and steel, the manufactures thereof, and machines and implements of all sorts, upon Europe and the United States. Year by year, however, Canada has been increasing her own productive capabilities in these particulars, until she now finds herself in certain respects practically independent of extraneous assistance. It is on the development of the iron and steel industries from her own self-contained resources that the advancement of all the various branches of engineering in the Dominion depends. . . . In considering the iron and steel industry of the Dominion it is one that is developing so rapidly, presents such vast industrial possibilities, and promises to be so all important a factor in the promotion of the permanent prosperity of the Colony that if demands especial review . . . efforts in this direction, that is, the development of these particular industries, have been very greatly facilitated by the duty imposed on iron entering the Dominion - for a good deal of the imported ore was used in admixture with the native product - and by the increased encouragement offered by both the Dominion and Provincial Governments in the way of bounties. That is the history of the Canadian iron industry as shortly as I can give it to honorable members. Now let us see what the Lithgow expert, appointed by the Government, has to say. This is the official who tests the whole of the iron; and in the *Lithgow Mercury* of 14th October, there is printed a statement made by him - . The quality of this wrought iron made from the native ores has shown a vast improve - ment over the re-rolled scrap. The Government specification provided for various qualities, which had to withstand the most rigid tests ; in fact, the specified tests in some cases were so severe that only iron equal to the very best selected * Lowmoon " could meet them. Thousands of tons of wrought iron have been produced at Lithgow during the new contract period, and the stringent requirements of the railway and public works engineers have been met in a very satisfactory manner. After giving some figures which it is unnecessary for me to read, he went on to -say - >Hundreds of tests are made monthly. That is an answer to those who have said that we have no satisfactory guarantee as to the quality of this iron. {: .speaker-KFN} ##### Mr FOSTER:
NEW ENGLAND, NEW SOUTH WALES · ALP -- It cannot be any good, -since it is produced in Australia ! ' {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- That is what some people think. The Government testing engineer went on to say - >There is no doubt that the Lithgow steel will, following the lead of other countries, rapidly supersede iron for most engineering purposes. The contract price is less than half that of imported iron of similar strength and ductility. That was the point that I was emphasizing before we adjourned for dinner. The Lithgow iron is too good for some purposes. It is superior to the imported iron, which is used in many cases. {: .speaker-KFN} ##### Mr FOSTER:
NEW ENGLAND, NEW SOUTH WALES · ALP -- The machinery made from our own iron will last too long. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- We certainly do not desire to see vessels built of Australian steel losing their propellers or shafts. We have no desire that accidents should occur as the result of the use of inferior materials. The Government expert went on to say - >It speaks well for the management that, in face of many initial difficulties consequent upon the introduction of a new industry, they have been able to supply iron and steel fully equal and in many cases superior to the imported material. Special mention might be made of the high-grade iron for railway draw gear and the high-grade steel regularly produced. These extracts point conclusively to the value of the iron produced at Lithgow, and I hold that our conduct will be reprehensible if we do not take steps to develop the vast deposits of iron ore to be found all over Australia. The only other point that I wish to mention is that Messrs. Hoskins, according to the statement from which I have quoted, are losing 3s. per ton on their iron as produced at Lithgow. That loss is increased by the cost of delivery, which is not taken into account. I am aware that it would be necessary to erect certain machinery costing a large sum of money at the Lithgow works, in order to enable certain branches of the industry to ba opened up there ; but I think that I have shown good reason for the proposal that I have submitted. Had the Government thought it possible to carry a duty on iron, I should have been glad to propose one. On one occasion I did introduce a measure providing for the imposition of a duty; but the Bill was blocked practically from the moment of its introduction, and I could not proceed with it. I obtained information as to what were the prospects of passing into law the Bill that I am now submitting, and it seems to me that this is the only way in which such an industry as this could be assisted. I hope that the Bill will be carried. By passing it we shall do something that will redound to the credit of the Parliament, and will assist not only Messrs. Hoskins, but any other firm that invests its capital in the industry. It will give such men heart in their efforts to develop this latent source of wealth. I believe that there is every prospect of the industry being developed here to an even greater extent than it has been in Canada. It may not grow as rapidly here as it has in the United States; but if we do not make a start; we shall never promote the local production of that which is absolutely essential to many other local industries. We have imposed duties to assist other manufacturers, but have failed to place on the statute-book of the Commonwealth any measure to encourage this great industry, or to give those who have invested their capital in it any protection from dumping. The surplus iron and steel manufactures of the United States of America, and probably some of the surplus products of Canada, as well as of other countries, are dumped in Australia. Practically no freight is paid on them, and they are sold at a lower price than is ordinarily charged. Whilst we allow that to be done, we are permitting what should be a great source of wealth to remain dormant. We are neglecting a splendid opportunity for the local investment of our own money, and neglecting, too, the development of what should be a source of employment at good wages for hundreds of our workers. I hope that a division will be taken on this motion to-night, so that the recommittal stage of the Bill may be proceeded with to-morrow. {: #debate-9-s8 .speaker-KEA} ##### Mr KELLY:
Wentworth .- The Minister in charge of this motion said he could plead justification for the introduction of the measure to which it relates. He quoted statistics showing what the iron bounty had done for Canada and other parts of the world, in further justification of his proposal, but I did not hear a word from him in attempted justification of the reduction of the amount of the bounty that is proposed to be paid. {: .speaker-KIN} ##### Sir William Lyne: -- I shall deal with that matter when the Bill is in Committee. {: .speaker-KEA} ##### Mr KELLY: -- The one statement I thought we should get from the archangel - if I may venture to traduce the archangels - of protection in Australia was a justification for reducing the bounty originally proposed to be paid on the local production of what must be the base of the great bulk of the protected industries, of Australia. Although I shall support the Bill, I do not claim to be a protectionist. Since this is a week of pedigrees, may I say that Protection, to my mind, is by Greedy Prejudice out of Political Intrigue, and that I am not going to back such a horse. We in Australia have accepted the principle of protection, and have endeavoured to build up local industries. If we are going to build up the protected industries of Australia, we must start from a solid foundation, otherwise the whole argument for making the country selfsupporting will rest upon what the protectionists describe as the rotten foundation of importations. The structure which my honorable friend the engineer of the Government is endeavouring to build on ai» Australian fiscal policy will rest on an absolutely unsound foundation, until we can have the local production of iron, the basis of all protected industry, properly encouraged. I am satisfied that the Lithgow ironworks must close down unless they receive Government assistance. Faced with the political situation as I find it today, I am compelled to support the measure brought forward by the Government. I must say, however, that I did expect that the Treasurer - the man who is in the very forefront of the protectionist movement in Australia - would have apologized to the protectionist public of the Commonwealth for his action in proposing so large a reduction of what was originally intended to be the bounty payable on the local production of iron and steel. {: #debate-9-s9 .speaker-KGZ} ##### Mr HEDGES:
Fremantle .- It was not my intention to speak to this motion until the Treasurer thought fit to accuse me of having tried to destroy the Manufactures Encouragement Bill, and of being an unprogressive member. As a matter of fact, I voted for every clause in the Bill, until we reached that part of the schedule in which provision is made for the payment of a bounty on the local production of wire netting from imported wire. If that provision remains in the Bill, I shall certainly oppose it. I venture to say that although the Treasurer has indulged in much vapouring in this House as to what he has done to promote the industry, he has not done half as much as I have to assist the Lithgow ironworks. Two years ago, in Western Australia - not in New South Wales - I let a contract for £26,000 worth of waggons to Messrs. Hudson and Ritchie, who produced a certificate from the New South Wales Government authorities that Lithgow iron was of the requisite quality to permit of its use for the draw- gear and other ironwork of the waggons. That iron was used in their construction, but I doubt whether the Treasurer" has ever contributed a penny to the encouragement of the industry, although he describes me in this connexion as an unprogressive man. He is constantly making erroneous statements ; it is well known that he is seldom right. I shall vote for the Bill, but shall certainly oppose the provision made in the schedule for the payment of a bounty of 10 per cent, on the production of wire netting from imported wire. I fail to see what it has to do with the Australian iron industry. The next item in the schedule, which relates to the production of pipes of certain sizes from imported material, may be placed in the same category. It should be clearly understood that any article mentioned in this Bill must be made from iron produced from Australian ore. I stated previously that if the wire netting was woven from wire made in Australia I should not mind giving a bounty of £3 a ton to encourage the industry, but we are asked to do too much for an industry which uses imported wire. If the Treasurer can see- his way to add the words, " made from Australian ore" to the last two items I shall vote for them, and be prepared even to increase the percentage of bounty to be given. Notwithstanding that the Bill is meeting with opposition from the supporters of the Government, I hope it will pass this House and be successful in its operation. {: #debate-9-s10 .speaker-JRH} ##### Mr BOWDEN:
Nepean .- I had intended to speak at some length, but 1 believe that the interests of the industry will be best served by the vote being taken without delay. As I shall have the right to speak later in Committee upon the Bill, I shall reserve my remarks until then. {: #debate-9-s11 .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- On previous occasions I opposed similar measures submitted by the Treasurer, not because I was against encouraging an industry of this character by a bonus, but because I thought that the iron industry, being practically the mother of all other industries, and one which, as in other countries, would attain great dimensions, would ultimately, if left in the hands of a private company, partake of the nature of a monopoly. I therefore desired, and still desire, that the States should take the matter in hand, as they have done the railways, and, in some instances, the tramways - whilst not blocking private investments in the industry guaranteeing the public against its becoming a monopoly. Failing that, I was disposed to agree to vote money to assist private interests, largely because my own State refused to consider the industry as one which it could engage in, in spite of the fact that the Government is a large consumer of iron. There is sufficient consumption by the State to keep the industry going for a large part of the time. {: .speaker-JRH} ##### Mr Bowden: -- The State could not consume more than half the output at the present time. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- The State consumption is, at any rate, a large factor. Without it the opening for the industry would be very small. Failing State control, I said that I was prepared to vote money to establish the industry by means of a bonus, but that I wished to see the public interest safeguarded in the Act itself, so that if the industry were placed upon a workable and sound basis by the taxpayers' money the State or Commonwealth should be enabled to acquire proprietary rights in it at a fair valuation, if that at any time were thought desirable, in order to prevent the creation of a private monopoly. I understand that the Treasurer is now prepared to recommit the Bill and give honorable members an opportunity of moving in that direction. If so, I shall place no obstacle 1 in the way of the proposal which he has submitted., Whilst I recognise that it is useless, in view of the hostility of the State Government, to insist upon provisions which we inserted in a previous Bill, I shall, when the Bill is recommitted, do my best to- safeguard public interests by the insertion of a clause to permit the resumption of the industry by the State or Commonwealth at any future time. The position of the industry at Lithgow at present is that a blast furnace has been erected, and a considerable amount of pig iron_ produced from native ore has been placed upon the market. It is stated by **Mr. Burrow,** C.E., the State Government's testing engineer at the foundry, in a report, that many of the problems which presented themselves in connexion with the production of the iron have been successfully overcome. I am pleased to learn that it is possible to produce at the Lithgow foundry pig iron that can- be used in many manufactures. During (the , last twelve months 6,500 tons of pig iron have been produced there, and have entered into consumption' in the State railways. Standard tests show that iron produced at Lithgow from native ore compares most favorably with any other that comes into competition with it. We have already voted bounties to assist other industries, more particularly those connected with agriculture, and I see. no reason why some consideration should not be given to a big industry such as this should be if Australia is to progress along the lines that we wish for her. I hope that, as the result of this further consideration of the measure, something substantial will be done to establish the industry, and that _ the Minister will recognise that, in asking the public to assist it in its infancy and in its period of stress arid' trial by putting their hands into their pockets to provide a bonus, he should at the same time make ample provision to allow the industry to be controlled in the interests of the public if at any future time it threatens to become a monopoly. {: #debate-9-s12 .speaker-JX9} ##### Mr FRAZER:
Kalgoorlie .- If we are undertaking a policy of granting bounties to establish industries in Australia, I admit frankly that the iron industry is one that deserves special consideration. It should have received consideration long before industries that were benefited by another Bounties Act passed by this Parliament. I have long thought, in connexion with this proposal, that we required a comprehensive statement of the financial position of the Commonwealth. The Treasurer has made such a -statement covering the past financial year, and a forecast of the position to the 30th June, 1909. That, of course, is as far as most Treasurers are in the habit of going. {: .speaker-L1R} ##### Mr Agar Wynne: -- When they mortgage the future they ought to tell us how they are going to meet their engagements. {: .speaker-JX9} ##### Mr FRAZER: -- It is impossible to pass a Bill of this description to be of any use to those whom it is intended to benefit without to some extent mortgaging the future. We could not seriously consider a proposal to grant a bounty to the iron industry for twelve months. Consequently I do not think the Treasurer should be seriously blamed for not predicting the exact financial position of the Commonwealth at the end of the financial year 1913-4 - the date at which it is proposed that these bounties shall terminate. {: .speaker-KJE} ##### Mr W H IRVINE:
FLINDERS, VICTORIA · ANTI-SOC; LP from 1910; NAT from 1917 -- Not for not exactly predicting the position, but when we are asked to commit the country to permanent additional expenditure of millions of pounds per annum, the least that could be expected is that the Treasurer should give some outline. {: .speaker-JX9} ##### Mr FRAZER: -- I agree that the Government should state the approximate liabilities which their immediate proposals will hand down to future Parliaments, but an ' ' additional expenditure of millions of pounds per annum " is not contemplated by this measure, at any rate at present. {: .speaker-KJE} ##### Mr W H IRVINE:
FLINDERS, VICTORIA · ANTI-SOC; LP from 1910; NAT from 1917 -- Certainly not. {: .speaker-JX9} ##### Mr FRAZER: -- The Treasurer has. made a conservative estimate of £12,000 for this financial year. {: .speaker-KIN} ##### Sir William Lyne: -- I spoke subject to advice. That is the estimated expenditure for the period from January to June next. {: .speaker-JX9} ##### Mr FRAZER: -- I hope that the honorable member's estimate, in this case, is nearer the mark than his estimate regarding the probable expenditure under the Invalid and Old-age Pensions Act. {: .speaker-JRH} ##### Mr Bowden: -- The Lithgow works will not get more than £24,000 a year, which will be ,£12,000 for the half-year. {: .speaker-JX9} ##### Mr FRAZER: -- My honorable friend sees only Lithgow. No doubt, if he were to express his thoughts fully, he would tell us that the only application for a bounty will come from that quarter. {: .speaker-JRH} ##### Mr Bowden: -- I do not think so. {: .speaker-JX9} ##### Mr FRAZER: -- I think that the Lithgow works alone will be benefited in the near future by the passing of the measure. I am not opposed to giving consideration, for the establishment of a national industry, to the successors of the enterprising **Mr. bandford,** whose enterprise has met with such strenuous competition that it is surrounded with considerable business risks. But we must carefully weigh the financial proposals submitted to us in the light of our commitments up to 1910, and a careful scrutiny of the data before us shows that a bounty of 12s. per ton is more than should be asked for. I find that to manufacture a ton of iron at present costs the company between 2s. and 3s. more than the product fetches in the open market. {: .speaker-JRH} ##### Mr Bowden: -- Those figures relate- only, to the cost of production at Lithgow, and do not take freight into consideration. {: .speaker-JWG} ##### Mr Fowler: -- The company gets a reduction of 70 per cent, in freight. {: .speaker-JX9} ##### Mr FRAZER: -- Does not the honorable member for Nepean think 9s. too much to allow merely for the selling of the iron? {: .speaker-JRH} ##### Mr Bowden: -- The freight to a State' like Western Australia would be from 13s. to 14s. a ton. {: .speaker-JX9} ##### Mr FRAZER: -- I think that that is an over-estimate, although, owing to the shipping combine, it would be dearer to send pig-iron from Sydney to Perth than to get it from New York or San Francisco. The combine charges extravagant freights for the transport of goods from the eastern States to Perth. {: .speaker-KRN} ##### Mr Sinclair: -- All the States suffer because of the high freights charged by the shipping companies. {: .speaker-JX9} ##### Mr FRAZER: -- Western Australia is in a worse position than the other States. {: .speaker-JWY} ##### Mr Chanter: -- The freight to Fremantle from England is 10s. more than that to the eastern States. {: .speaker-JX9} ##### Mr FRAZER: -- When a full cargo is consigned to Fremantle, the freight is no higher than to the eastern States, but if a steamer has to put in there to discharge a part cargo of certain kinds of goods, the freight is higher. In connexion with the proposed bounty, Western Australia will have to pay her share of the total cost, and, if she uses the iron produced at Lithgow, will be charged more to ha.ve it brought from Sydney to Perth than she would have to pay to get iron from New York or San Francisco. However, I do not take the narrow view, because I am prepared to give reasonable encouragement to the establishment of a national industry. But I am not called upon to vote for a larger expenditure than is necessary. The granting of a bounty is preferable to the imposition of a duty, at all events, until Australian production is sufficiently large to meet the requirements of the country. The imposition of ai duty before the local production had met the local demand would penalize all secondary industries using iron as a raw material. I think, however, that a bounty of 12s. per ton is too much to ask for, seeing that the difference between the cost of production and the selling price is only 3s. I would not make the bounty as low as that difference, because we ought to give encouragement to the export of the Lithgow iron to markets Other than those of New South Wales; but I think that a bounty of 7s. 6d., which is 4S. 6d. more than the difference between the present cost of production and the selling price, should be sufficient for all purposes. {: #debate-9-s13 .speaker-JMG} ##### Mr ATKINSON:
Wilmot .- No doubt the establishment of the iron industry in Australia is of vital importance, because iron is a commodity indispensable to so many industries, and necessary for the production of means of defence. Notwithstanding that Australia's output of primary produce is, per head of population, greater than that of any other country in the world, we have already granted bounties for the State encouragement of various rural industries of much less importance than the iron industry. Our present financial position is not too good, but if money is to be paid in bounties, I would rather see it go to foster the iron industry than to encourage industries of less importance. I am practically pledged to support the granting of a bounty for the production of iron, but, since giving that pledge, I have come to the conclusion that the iron industry could be better established in Australia by the imposition of a duty of 15 per cent. ' I have been given to understand, on pretty good authority, that if such a duty were imposed, a large amount of capital would be invested in the working of iron ore deposits in various parts of Australia. However, as a bounty has been proposed, the immediate question to consider is : Would it have the desired effect? Had I no doubts on the point, I should give my best support to the proposal, but, according to a balance-sheet showing the operations of the Lithgow iron works, which was published some time ago, every ton of pig-iron produced there costs about 9s. more than it can be sold for, while bar iron and steel costs from 2s. 6d. to 3s. per ton more than it fetches in the open market. It seems to me that if we give a bonus,; this company at Lithgow may be able to carry on while that bonus lasts, but that, when the assistance is withdrawn, they will find themselves in the position they are in to-day. In Canada, similar results have followed, and the Government find it necessary to continue the assistance, or let the industry cease. {: .speaker-KEA} ##### Mr Kelly: -- That same argument applies equally against the duty. {: .speaker-JMG} ##### Mr ATKINSON: -- I should not desire to see a duty removed if it succeeded in establishing the industry ; I am prepared to regard this matter entirely apart from fiscal considerations. Looking at the figures I have quoted, it seems very doubtful to me whether the bonus will establish the inlustry, because it will not prevent the importation of foreign iron. If a bonus would tend to remove foreign competition, the end we have in view might be attained ; but while there is that competition, I cannot see how the local manufacturers can capture the Australian market. With a duty, however, the local market might be obtained, and then, doubtless, with increased protection, the cost per ton would decrease. I notice from the figures published in reference to Lithgow, that, in the period when there was the greatest production, the price per ton was lowest. I am pledged to support an iron bonus; and we must not forget that the Messrs. Hoskins went into the venture 011 the understanding that Parliament would do something for the industry. {: .speaker-JX9} ##### Mr Frazer: -- What is that? {: .speaker-JMG} ##### Mr ATKINSON: -- The present company had some reasonable grounds for anticipating that Parliament would assist the industry. {: .speaker-JX9} ##### Mr Frazer: -- What grounds? {: .speaker-JMG} ##### Mr ATKINSON: -- There was an assurance, or something like an assurances, that the Treasurer would introduce a Bonus Bill, and the people engaged have shown a fine spirit of enterprise and pluck, which, 1 am sure, would also lead them not to expect me to support a bonus simply for the benefit of themselves. I am practically pledged, as I say, to vote for a bonus, ant) I shall, of course, adhere to that pledge. {: #debate-9-s14 .speaker-KJC} ##### Mr HANS IRVINE:
GRAMPIANS, VICTORIA · ANTI-SOC; LP from 1910 -- Looking at the matter from an Australian point of view, I think that if any bonus is given, it should be for the production of our own iron and steel. If we hope to be a great and progressive people, we must supply ourselves in this connexion, and, for that reason, I support the Bill. I do not think, however, that the bonus proposed will establish the industry in other States, where I should like to see it established. The bonus might be extended for a term of years, and then abandoned, and a fair duty substituted. That, however, is *in futuro,* and, in the meantime, the bonus ought to be increased if necessary. But the Government propose to reduce the bonus from £250,000 to £150,000, and I cannot see that the latter amount will have the effect of establishing an industry in Western Australia, South Australia, or Tasmania. We know from analysis that there are magnificent ores in the three States I have mentioned. I have no desire to see this bonus go into the pockets of one firm only, and it looks as if that would be the result of the present proposals. That would not. be in accordance with the desire or wishes of the people of the Commonwealth, but we must be just to those men who have established the industry at Lithgow, because they were led to believe that a Bonus Bill would be passed by the Federal Parliament last session. Our friends in the Labour corner desire to nationalize this industry, but, in my opinion, it would be better to leave it to private enterprise, and, bv inducing competition, encourage the manufacture in all the States. Above all things, if we desire to be a self-contained people, we must produce our own iron and steel ; and, therefore, I believe that the Bill will be accepted. As to wire netting and wire, we ought not to pay any bonus unless the manufacture is from Australian ore. {: #debate-9-s15 .speaker-F4P} ##### Mr REID:
East Sydney .- I have always looked with extreme scepticism on efforts to found any great industry by artificial methods; but, at the same time, I consider that there are fewer objections to the bounty system than there are to the protective system. It is rather surprising to me that gentlemen who are protectionists and who have voted large duties to protect industries which are insignificant as compared with the one under notice, should raise difficulties in the way of a bounty being given. I can understand the difficulty protectionists are in, seeing that iron is the raw material of our manufacturing industries. While manufacturers are strong protectionists in reference to everything they want to sell, they are strong free-traders in connexion with what they want to buy ; and they desire free-trade in iron because it is one of their vital necessaries. I do not think there is an industry which stands before the people ot Australia with a higher claim than the iron industry at Lithgow. It was established by a man of great enterprise, entirely at his own risk; he sank everything he had in the world in the industry, without the barrier, or the encouragement, of a Tariff. Men are a credit to Australia who. without the slightest security, sink the whole of their fortune in an endeavour to establish a great industry. It is quite easy for men of enterprise to come forward when there has been a barrier set up against imports, but my highest admiration is reserved for such enterprise as that displayed by **Mr. Sandford.** We have now in the industry another firm who have, I suppose, risked all that they have in the world, and who, for their great enterprise, have earned arc honorable name in the industrial sphere. I think that the right honorable member for Swan knows this firm favorably in connexion with the great national works which ha was instrumental in carrying out in Western Australia. {: .speaker-KFJ} ##### Sir John Forrest: -- Hear, hear. {: .speaker-F4P} ##### Mr REID: -- This firm are a credit to Australia, and .when the honorable member for Cook speaks of the wealth of the firm, all I can say is that they have sunk every penny they have in the world, risking all in an industry which has a larger element of encouragement to labour than, perhaps, any other in Australia. {: .speaker-JWO} ##### Mr J H Catts: -- Does the right honorable member think thatthe firm have put all their money into this venture ? {: .speaker-F4P} ##### Mr REID: -- I fancy they will have to. {: .speaker-KIN} ##### Sir William Lyne: -- They have invested £247,000. {: .speaker-F4P} ##### Mr REID: -- I know that the amount is over £200,000, and I guarantee that there is not a penny owned by this firm which is not pledged in connexion with the industry. Of course, we have to be critical as to the rate of bounty which is to be given ; but at present we are simply dealing with the message. I wish to take advantage of this opportunity, without speaking atany length upon a measure which has been so often before the House, to complain very strongly of the unfair way in which the Treasurer has accused honorable members of the Opposition of preventing the passage of the Bill at the end of last session. That was a very unfair charge and was especially levelled at the honorable member for Illawarra. The facts are that the Bill was introduced within two or three days of the end of the session. {: .speaker-JUV} ##### Mr Mcwilliams: -- Within two or three hours of the end of the session. {: .speaker-F4P} ##### Mr REID: -- I did not wish to overstate the facts. It was on 5th June last that the House was suddenly asked to proceed with the consideration of the Bill, which had been before one House or the other for two or three years. I understand from the honorable member for Moreton that we have already agreed to the first' part of the schedule, but that must be open to reconsideration. If it is proved that a bounty of 12s. per ton is absolutely proper and necessary, I am content to accept that rate, but I wish to point out that, years ago, I strongly opposed the Bill,my reason for doing so being that **Mr. Sandford** swore before the Iron Bonus Commission that the cost of producing pig iron in Lithgow was only 36s. per ton. If that were so, local manufacturers would not be entitled to a bounty because the cost of production in the United States and Great Britain is 50 per cent. higher. I am satisfied now that **Mr. Sandford** made an extraordinary mistake, and that the cost of production here, instead of being 36s. per ton is about £3 12s. or £3 13s. per ton. Consequently, my strongest objection to the Bill has disappeared in the light of the further knowledge we have. {: .speaker-JX9} ##### Mr Frazer: -- £3 10s. per ton is now said to be the cost of production here. {: .speaker-F4P} ##### Mr REID: -- **Mr. Sandford** said that the cost would be only36s. per ton, but in the light of the further knowledge we have, it seems to me that this claim for a bounty is at least as justifiable as any claim for a bounty ever put before this Chamber. Question resolved in the affirmative. Resolution reported ; report adopted. *In Committee* (Consideration resumed from 5th June, 1908, *vide* Vol. XLVL, page 1 2 180) : Schedule- On which **Mr. Kelly** had moved by way of amendment - >That after the words " wire netting " the words " not being prison made " be inserted. {: #debate-9-s16 .speaker-KEA} ##### Mr KELLY:
Wentworth .- The object of my amendment, which was moved when the Bill was before us at the close of last session, will be clear to honorable members when they read the schedule. It is to prevent the payment of the bounty on prison-made wire netting, which is now being produced in large quantities in Australia. {: .speaker-F4P} ##### Mr Reid: -- Is wire netting being made ir. Australian gaols? {: .speaker-KEA} ##### Mr KELLY: -- It is being made in Pentridge. I understand that the Government are prepared to accept the amendment. {: .speaker-KIN} ##### Sir William Lyne: -- That is so. {: .speaker-KEA} ##### Mr KELLY: -- Then I have nothing further to say. {: #debate-9-s17 .speaker-KCO} ##### Mr GLYNN:
Angas .- I am sorry that we have not a little more information as to what would be the effect of the passing of this amendment on the present production of wire netting in Australian prisons. I do not know that it is a commendable amendment. It might lead to tha destruction of a prison industry that may be a source of reformation to some of the men engaged in it. They are practically to be shut out of the industry by the payment of a bounty to those engaged in the manufacture of wire netting outside our prisons. {: .speaker-F4P} ##### Mr Reid: -- But the gaol authorities have cheap labour. {: .speaker-KCO} ##### Mr GLYNN: -- I am afraid that the amendment is rather too lightly entertained by the Committee to permit Of successful opposition being offered to it. {: #debate-9-s18 .speaker-L1R} ##### Mr AGAR WYNNE:
Balaclava -- The Government of Victoria, instead of allowing prisoners in the State gaols to remain idle are employing them in the manufacture of various articles. Men so employed are not competing with free labour outside. The wire netting manufactured at Pentridge is sold to farmers nt a higher rate than is charged for the imported article, and it is also used for enclosing Crown lands with rabbit-proof fences. I do not know why prisoners should be allowed to remain idle. The Government of Victoria has expended £30,000 or £40,000 in erecting a wirenetting plant at Pentridge, and we are now asked to say that that plant' shall be thrown into disuse. {: .speaker-KEA} ##### Mr Kelly: -- Wire netting is now being made in Pentridge without a bounty. {: .speaker-L1R} ##### Mr AGAR WYNNE: -- And it is also being produced outside without any bounty. The people of Victoria will have to contribute to the cost of this bounty, and yet the Government of the State are not to be permitted to draw any part of it in respect of wire netting made in its prisons. It is far better that prisoners should be made to earn their .own living, than that they should be kept in idleness at the expense of honest working men. I fail to see why thebounty should not be paid on prisonmadewire netting produced as it would be produced if the industry were nationalized. This prison industry is advantageous to> the State, and, although I could understand objection being raised to the importation of prison-made materials, I fail tosee why this amendment should be made. {: #debate-9-s19 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · Hume · Protectionist -- The amendment, I think, isa good one. I certainly object to the payment of a bounty on prison-made goods. The State of Victoria is at present having; wire netting made in its prisons, in competition with that produced by men who have invested money in the industry. It used to be the custom of New South Wales - and I believe that the practice still prevails to prevent the sale of goods made in the prisons of that State. I shall accept the amendment. {: #debate-9-s20 .speaker-L1H} ##### Dr LIDDELL:
Hunter .- The views expressed by the honorable member for Balaclava on this amendment are somewhat parochial. He appears to hold a brief for the advancement of Victoria asagainst all the other States. I do not think it right that prison labour should enter into competition with that outside, and I would remind the honorable member that, even if this prison industry inVictoria be ruined by the passing of the amendment, there is no reason why those engaged in it should not be employed in other directions. They might be more profitably employed in the work of afforestation. In that way they would do goodservice to the State, without coming intocompetition with free labour. The honorable member's argument is a weak one, and we have had on his part a display of parochialism, such as ought to be discouraged in this House. {: #debate-9-s21 .speaker-F4P} ##### Mr REID:
East Sydney .- I hopethat the honorable member for Balaclava will not think that those who favour this amendment, have any desire to see personsin confinement deprived of opportunities of industry and of learning trades. I should' hope that we wish every opportunity to beafforded those in our gaols to learn tradeswhich will be of service to them when they have completed the sentences under which they may be confined. But we are now dealing with a Bill which could scarcely fit such a case as the honorable member has referred to. Surely there is a distinction between an enterprise, such as that at Lithgow, and the manufacture of wire netting in one of His Majesty's gaols? The conditions of labour in our prisons are of a kind that do not prevail outside. I do not think that the unfortunates engaged in the manufacture of wire netting in Pentridge receive 8s., or 10s., per day for their labour. If the Victorian Government paid any such wages there might be some show of an argument for giving the bounty. {: .speaker-L1R} ##### Mr Agar Wynne: -- I dare say the labour costs more. {: .speaker-F4P} ##### Mr REID: -- Their living does not cost more. {: .speaker-L1R} ##### Mr Agar Wynne: -- Yes, it does. They cannot manufacture wire netting as cheaply there as it can be made in Sydney. {: .speaker-F4P} ##### Mr REID: -- Then gaol in Victoria must be a most desirable place to get into. If the living is better there than amongst the people outside it is a most dangerous argument in favour of getting into trouble. My recollection of prison dietary scales floes not tally with that of the honorable member. If the people in Victorian gaols are on some special dietary scale like those we get in some of the clubs in Australia, it is quite another matter, but my impression is that the cost of their keep cannot be very great. The expense of building gaols can scarcely be debited to the wire-netting industry carried on inside them. The security required for gaols has nothing to do with the manufacture of wire netting. I do not see how there can be any analogy between the cost of an enterprise outside of gaol and that of an enterprise inside it. {: .speaker-L1H} ##### Dr Liddell: -- Every industry in Victoria must be protected, {: .speaker-F4P} ##### Mr REID: -- I realize the thorough consistency of the honorable member for Balaclava. There is an instinct in his idea which is thoroughly characteristic. > If there is a Victorian industry in a gaol or anywhere else he will fight for it, and properly so from his point of view, because it is in accordance with his political principles. {: .speaker-L1R} ##### Mr Agar Wynne: -- He does not play for popularity. {: .speaker-F4P} ##### Mr REID: -- I hope "that the desire to earn the good opinion of one's fellow-men is not an undesirable feature in ordinary, frail humanity. Some rise superior to such considerations, but I do not regard the wish to be thought well of by the people of the country in which one lives as deserving of reproach. With every desire to be perfectly fair even to a gaol industry in Victoria, I do not see that there is a fair analogy between the two things. If the honorable member for Balaclava has some official information which shows that the wire netters in the Victorian gaols have tobe specially fed and specially pampered in order to produce the requisite quality of netting, there may be something in his contention, but if they are treated as the ordinary prisoner is treated, my impression is that he gets very plain fare and no wages. He gets a slight recognition of his industry when he leaves the gaol, but I do not think that constitutes a wage. Surely the Government of Victoria, in securing Tor practically nothing the labour of persons confined in gaol gets bounty enough. {: .speaker-L1R} ##### Mr Agar Wynne: -- They cannot sell thenetting at the same rate as the Sydney firm. {: .speaker-F4P} ##### Mr REID: -- That comes from the sort of management which prevails under such conditions. The free play of private enterprise has no chance in the Victorian branch of the industry. Is there really a wire-netting industry in a gaol in Victoria? I heard something' about a plant that was to be established. The Bill' would have to be radically altered to fit in with a bounty on prison-made! goods, andI confess I see no unfairness either to theVictorian Government or to the prisoners- in supporting the amendment. Amendment agreed to. Amendment (by **Mr. Page)** proposed - >That the following words be added after thoselast inserted : - " and made from Australianore." {: #debate-9-s22 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · Hume · Protectionist -- The carrying of this amendment would simply mean that theBill would be of no use so far as the wire netting industry is concerned. I should' have been glad to put those words in, but there is not the slightest prospect of wirebeing made here for several years. {: .speaker-L1R} ##### Mr Agar Wynne: -- Cannot it be made here as well as in Germany ? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- It might bedone if the honorable member would put up his money to erect the necessary works. The honorable member's attitude now israther contrary to his previously expressed desire to give a bounty on prison labour. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- Why give a bonusfor Australian ore and also for Germanwire ? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- Let honorable members look at the matter from a reasonable and practical stand-point. This bounty is supposed to be given only until 1912. I have made inquiries as to whether it was possible or at all probable to obtain and erect the machinery to make the wire in that period, and I find that it cannot be done. {: .speaker-L1R} ##### Mr Agar Wynne: -- It could be put up in six months. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- The honorable member does not know what he is talking about. When in England, I went to Hatfield's works at Sheffield, to ascertain whether it was practicable to arrange for the manufacture of wire in Australia within a reasonable time. I had that in my mind, because it had been talked about before I left. I saw the works that bad been erected there. They are very expensive. The wire is easily enough made with the proper machinery, but it takes extremely heavy machinery to do it. The first ingot is put through an immenselypowerful machine. If there were a prospect of the amendment being of any use, I should not oppose it ; but it simply means killing the Bill so far as it relates to the wire-netting industry. {: .speaker-JMG} ##### Mr Atkinson: -- Surely the elimination of this bounty of £50,000 will not wreck the whole Bill ! {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I think it will. {: .speaker-JWG} ##### Mr Fowler: -- If that is so, it deserves to be killed. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- The honorable member for Perth will, I know, kill the Bill if he can. The amendment would make a farce of this part of the Bill, for there is not the slightest possibility of having wire made from Australian ore for the next three and a half years. {: .speaker-KFJ} ##### Sir John Forrest: -- Then, what do we want the bonus for? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- To help our own people. The right honorable member wants to help the foreigner, and have German wire netting imported. {: .speaker-KXO} ##### Mr Page: -- That is not fair. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- It is absolutely true. {: .speaker-KFJ} ##### Sir John Forrest: -- The honorable member has no right to be so offensive. He attributes motives to me. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- We propose to pay the bonus only for three and a half years. {: .speaker-KFJ} ##### Sir John Forrest: -- The time could be extended. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- When the suggestion was made that the wire netting should be made from wire produced from Australian ore, I thought it would perhaps be possible to allow some reasonable time, say, a couple of years, before that provision should operate, as I thought it might be an inducement to the people to erect the necessary machinery in the time. {: .speaker-JUV} ##### Mr Mcwilliams: -- This bounty will go on for twenty years, as has happened in Canada. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- The bounties, as now proposed, are to last only for a comparatively short time, and then it will be for Parliament to decide whether they shall be continued. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- Would the honorable member limit the bonus to wire of British manufacture? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I should very much prefer to do that. I want to prevent the cheap and rotten wire netting from certain parts of the world coming into competition with Australian manufacturers of good netting. {: .speaker-KXO} ##### Mr Page: -- Say " Australian or British." {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I should like to hear a little more on the subject; but I should much prefer that, if I am to accept any amendment, to an amendment which would let all the rubbish of the world come here in competition with our own manufactures. I feel very much disposed to accept the honorable member's proposal ; but I do not like to pledge myself to do so at this moment. {: #debate-9-s23 .speaker-JX9} ##### Mr FRAZER:
Kalgoorlie .- I am afraid that the Treasurer, in his anxiety to pass the Bill, does not fully grasp the effect of the provision with which we are now dealing. It grants a bounty of 10 per cent, on the value of wire netting and wire produced within the Commonwealth. But does he seriously contemplate the free importation of pig-iron to encourage the manufacture of wire here? {: .speaker-KIN} ##### Sir William Lyne: -- No. The production and use of locally-made pig-iron will be encouraged and brought about by other provisions in the measure. {: .speaker-JX9} ##### Mr FRAZER: -- The bounty with which we are now dealing is for the production of wire as well as for the manufacture of wire netting; but if a bounty of 10 per cent. is to be given for wire as well as for wire netting, it surely cannot be intended to allow the free importation of pig-iron for the purposes of making the wire. {: .speaker-KIN} ##### Sir William Lyne: -- No. {: .speaker-JX9} ##### Mr FRAZER: -- Then the Treasurer must admit that the language used does not express his meaning. {: .speaker-KIN} ##### Sir William Lyne: -- I think that it does. {: .speaker-JX9} ##### Mr FRAZER: -- In my opinion, it does not. Unless it is stipulated that a bounty will be given only for wire made of Australian pig iron, the provision will be a failure. There is not a wire-making plant in Australia at the present time. {: .speaker-KEA} ##### Mr Kelly: -- The bounty is to be effective only for a short period, within which, the Treasurer tells us, the industry cannot be established. {: .speaker-JX9} ##### Mr FRAZER: -- I admit that the Treasurer's proposals were open to criticism in that respect. But what I am now suggesting is that the production of wire netting should be dealt with separately from the production of wire. If there is no reasonable prospect of having wire made in Australia, for a considerable time to come, the propriety of inserting the amendment of the honorable member for Maranoa in regard to wire netting is open to argument; but it certainly should be inserted if the bounty is to be given for the production of wire as well as for the production of wire netting in the manner proposed. But, to my mind, 10 per cent, on the value of the article produced is too large a bounty to give for the encouragement of the wireweaving industry. {: .speaker-KGZ} ##### Mr Hedges: -- Wire netting is woven on imported machines. {: .speaker-JX9} ##### Mr FRAZER: -- I understand that the cost of the operation is not more than from *2h* t° 3 Per cent. {: .speaker-JWG} ##### Mr Fowler: -- That is a liberal estimate. {: .speaker-JX9} ##### Mr FRAZER: -- It is proposed to give a bounty of 10 per cent, on the value of the completed article, to encourage an industry which is a mere matter of weaving imported wire into netting. If the bounty is agreed to by Parliament, the makers of wire netting will get a considerable profit, or the price of the article should be considerably reduced. If the Treasurer separates the proposals in regard to wire and wire netting, it may be reasonable to hold back for a time the stipulation that the bounty shall be paid in respect only to wire netting in which Aus- tralian ore has been used; but if the provision is to remain as it stands, we should insert that stipulation. {: #debate-9-s24 .speaker-L1R} ##### Mr AGAR WYNNE:
Balaclava -- The Treasurer, who has always posed as a protectionist, now proposes to prohibit the manufacture of wire in this country. {: .speaker-KIN} ##### Sir William Lyne: -- That is not true. {: #debate-9-s25 .speaker-10000} ##### The CHAIRMAN: -- The Treasurer must withdraw those words. . {: .speaker-KIN} ##### Sir William Lyne: -- Then I will say that the statement is not correct. {: .speaker-L1R} ##### Mr AGAR WYNNE: -- The Treasurer told us that he had been to Sheffield. I have been there, too. A large Sheffield firm has stated that it can erect in Australia, within twelve months, a plant sufficient to meet the requirements of the Commonwealth ; but the Treasurer tells us that that cannot be done. If Australian ore is to be used for the manufacture of other iron, it should be used for the manufacture of wire iron. When the honorable gentleman was introducing the measure on a former occasion, he said that the importations of wire iron and steel into Australia were worth £520,000 ; of pipes and tubes of iron and steel, £35-2j°oo ; and of barbed wire, £70,000. He laid emphasis on the fact that these importations were worth, in the aggregate, nearly £1,000,000, and he said that he wished to encourage the manufacture of these goods in Australia. But by opposing the amendment of the honorable member for Maranoa, he is doing his best to prevent the establishment of this industry here. If he were a true protectionist, he would support the amendment requiring the use of Australian ore in the manufacture of Australian wire on which bounty is to be paid. According to the evidence taken by the Tariff Commission, the cost of weaving wire into netting is exceedingly small. {: .speaker-KGZ} ##### Mr Hedges: -- About 12s. a mile. {: .speaker-L1R} ##### Mr AGAR WYNNE: -- Yet the Treasurer proposes a bounty of 10s. a ton for the weaving of netting from wire imported from Germany, Belgium, or, perhaps, Japan. He will not allow wire to be manufactured in this country. {: .speaker-KJE} ##### Mr W H IRVINE:
FLINDERS, VICTORIA · ANTI-SOC; LP from 1910; NAT from 1917 -- He will accept the amendment. {: .speaker-L1R} ##### Mr AGAR WYNNE: -- He said that he would not, and he asked time to consider the proposal. He wishes to find out how the cat will jump. I intend to support the proposal of the honorable member for Maranoa. Twenty years ago I imported from New South Wales, for the erection of a rabbit-proof fence, a large quantity of netting which was then being made there under free-trade. Notwithstanding that the industry has been successful without any protection, the Minister proposes to give it a bounty which will have the effect of preventing the manufacture of wire from Australian ore, and will encourage the use of imported wire. {: #debate-9-s26 .speaker-KIN} ##### Sir WILLIAM LYNE:
Treasurer · Hume · Protectionist -- I do not think that the point taken by the honorable member for Kalgoorlie is a good one. The intention is to give a bounty on wire netting, and a bounty on wire manufactured from Australian ore. We wish to assist the manufacture of wire netting made from Australian ore. The honorable member for Balaclava has unfairly twisted my statements. As a rule he tries to be fair, but to-night he deliberately accused me of opposing the manufacture of Australian wire from Australian ore, notwithstanding that I am trying to get a bounty for the encouragement of that industry. {: .speaker-JRH} ##### Mr Bowden: -- There is nothing to prevent the use of Australian pig iron. {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- There is an inducement to make the pig iron here under the bonus. {: .speaker-JX9} ##### Mr Frazer: -- Does the Treasurer not think that the production of wire is likely to be more expensive than the production of wire netting? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- I think it is likely to be much more expensive, so far as the machinery is concerned. {: .speaker-JX9} ##### Mr Frazer: -- Why not separate the two items? {: .speaker-KIN} ##### Sir WILLIAM LYNE: -- This wording is prepared by the Crown Law officers, and, in my opinion, carries out the intention. I do not think it very probable that any Sheffield or other firm could have wire works erected here in twelve months. . {: #debate-9-s27 .speaker-K5J} ##### Mr COON:
Batman .- If there is an industry that has not received proper consideration at our hands it is the wirenetting industry. It was started, I think, some twenty-three years ago by **Mr. Sandford** in New South Wales ; and, for some time, enjoyed a duty of 10 per cent. When the Tariff was under consideration it was stated that boys were principally employed at very low wages, the honorable member for Grampians asserting that 30s. a week was the usual figure. How ever, I Rave here a wages sheet , which shows wages ranging from £4 to *j£$* 6s. 3d-> *£3* 6s., and so forth. {: .speaker-KJC} ##### Mr HANS IRVINE:
GRAMPIANS, VICTORIA · ANTI-SOC; LP from 1910 -- The statement was not my own, but one made by a member of the honorable member's own party. {: .speaker-K5J} ##### Mr COON: -- There is not a man, except a labourer, who receives less than 7s. a day. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- Does the honorable member know that there was a big strike at these works? {: .speaker-K5J} ##### Mr COON: -- I understand there was a strike some years ago, owing to trouble under an old manager, but, at the present time, with a new man in charge, the employes are well satisfied. When the industry was started wire netting was selling at £35 a ton, and, when the duty, was imposed, the price was still further reduced, while the size of the works was increased. However, the duty was taken off, with the result that the importer began to dump his goods into the country, as he is doing today. The amendment, if carried, will have the effect of throwing 150 men out of employment. {: .speaker-KXO} ##### Mr Page: -- What rubbish 1 There has never been a bonus before. {: .speaker-K5J} ##### Mr COON: -- If the amendment is carried it will be impossible to pay proper wages and compete with sweated goods from Germany and elsewhere. It has been stated in the *Sydney Morning Herald* that the result will be to throw 150 men out of employment, and Victorians are accused of bringing this about. It is stated that if this had been a Victorian industry the duty would have been continued; and yet we are now asked, in the face of a petition from 450 men, to pass an amendment which will have the effect of reducing employment to the extent I have indicated, although I am sure that the honorable member for Maranoa would be the last to welcome any effect of the kind. In Victoria **Sir Thomas** Bent, when he saw the extent of the competition, offered to give the local manufacturers a preference to the extent of £1,000 on wire netting; and, if assistance is not given, it will be impossible to pay proper wages. What surprises me is that, so far as I know, not a single New South Wales representative has visited this factory ; and I am inclined to think that if there had been more knowledge on the subject on the part of honorable members, different action would have been taken by this House. At the present time some £636 is paid each week in wages. {: .speaker-KJ8} ##### Mr Hutchison: -- How will the proposal before us throw men out of work? {: .speaker-K5J} ##### Mr COON: -- Because wire must be imported at the present time; and it has been estimated that a factory and plant cannot be established under two or three years. Let me remind the honorable member for Balaclava, who says that a Sheffield firm is willing to erect wire-netting works inside twelve months, that in England today there is an agitation for a duty, in order to protect the English workmen against the German wire-workers. The present Prime Minister of England stated some time ago that some action would have to be taken in order to compete with the sweated labour of Germany. {: .speaker-L1R} ##### Mr Agar Wynne: -- And the honorable member desires to let the results of that labour come in here free ! {: .speaker-K5J} ##### Mr COON: -- The honorable member may think that he can side-track me with that interjection; but he desires to have not only wire, but wire netting free. {: .speaker-L1R} ##### Mr Agar Wynne: -- I do not. {: .speaker-K5J} ##### Mr COON: -- We do not insist on other manufacturers using only Australian timber, Australian leather, Australian iron, and so forth, before giving them any protection ; and the same consideration should be given to the workers of New South Wales as to the workers of any other State. I am surprised that the members of the Labour Party should support such a proposal as that before us. {: .speaker-KNH} ##### Mr Mathews: -- I do not believe that the wages quoted by the honorable member are paid I {: .speaker-K5J} ##### Mr COON: -- That is rather an unfair remark, seeing that I have here an original wages sheet. {: .speaker-KNH} ##### Mr Mathews: -- I think that the sums quoted must be paid fortnightly, and not weekly. {: .speaker-K5J} ##### Mr COON: -- I have been personally informed that these are the weekly wages paid. {: .speaker-JX9} ##### Mr Frazer: -- Does the honorable member desire to have Australian wire made from Australian ore? {: .speaker-K5J} ##### Mr COON: -- I want these men to be employed. I may say that, when I visited the factory, I was handed this original wages sheet, and the manager gave me permission to interview any man as to his hours and wages. The week consists of fifty-two hours for some workers and forty -eight hours for others, and the employes receive extra payment for overtime. I asked six of the men what wages they received, and found that their statements tallied with the wages appearing in the pay-sheet. I also saw a number of boys employed in the industry, and learned that they were receiving from 25s. to 36s. per week. {: .speaker-KNH} ##### Mr Mathews: -- I wish that the honorable member would induce some of the iron-masters in my electorate to pay such wages. {: .speaker-K5J} ##### Mr COON: -- As a member of the Labour Party, the honorable member should see that good wages are paid by them. I trust that the Committee will agree to grant some assistance to the wire netting manufacturers of Australia. The honorable member for Maranoa, I am sure, would not like to see men working for 15s. a week. That is not the policy of the party to which he belongs; and, in view of the documentary evidence that I have produced as to the wages paid in the industry, I hope that the Committee will agree to the payment of the bounty as desired by the Treasurer. {: #debate-9-s28 .speaker-KJC} ##### Mr HANS IRVINE:
GRAMPIANS, VICTORIA · ANTI-SOC; LP from 1910 -- The honorable member for Batman appears to be a walking encyclopaedia with regard to industrial matters; but his facts are usually wrong. He has told us to-night that we have to protect 150 men who are engaged in making .wire netting. The ambition of Australia, however, is to have not 150 but 1.50,000 men employed in the industry. In order that our desire may be realized, we need first of al! to establish the local manufacture of pig iron and the making of drawn wire from Australian material. Unless we do that, the manufacturers of wire netting in Australia will always have to depend upon America or some other country for their raw material. If we are to become progressive, we must be able to work up our own raw materials. We are certainly prosperous, but, in some respects, are retrogressing rather than progressing. Australia is more prosperous than is any other country with a like population ; but that is due largely to our glorious climate and our rich . natural resources. If we have men seeking, like the honorable member for Batman, to strangle industry, we shall never go ahead. I thought that, with the passing of the Tariff, we were to have fiscal peace, but the Treasurer is now endeavouring, by a subterfuge, to obtain that assistance for the manufacturers of wire netting that was refused when the Tariff was before us. The honorable member then proposed a duty of 25 per cent, or 30 per cent., but was unsuccessful. We recognised that it is of the highest importance to Australia that our farmers, squatters, and graziers should be able to obtain wire netting at reasonable cost, in order that they may be able to cope with the rabbit plague, and we refused to agree to the imposition of such a duty. But for wire netting, this season we should have had no grass or stock left in some districts. The honorable member for Batman has probably spent all his days in Melbourne, and seems always to look at life through Melbourne spectacles. I would advise him to visit the back blocks, in order that he may become familiar with the privations of the primary producer. *If* he does so, he will talk of finding employment, not for 150 men in a city, but for thousands in the country. I repeat that this proposal is only a subterfuge on the part of the Treasurer to re-open the Tariff. He threatened to bring it forward when he was beaten on the wire-netting duty ; and he ought not to ask us to agree to a bounty being paid on the manufacture of wire netting unless he' is prepared at the same time to submit effective proposals for the establishment of not only the pig-iron industry, but that of the manufacture of drawn wire. By accepting the amendment moved bv the honorable member for Maranoa he will do what is right in the interests of Australia. I intend to support the amendment. {: #debate-9-s29 .speaker-KXO} ##### Mr PAGE:
Maranoa .- The honorable member for Batman has been weeping and wailing about the possibility of 150 men being thrown out of employment by the proposed alteration in regard to this bounty. He has let the cat out of the bag. The Treasurer could not keep his understudy muzzled, and he has given away the whole show. {: .speaker-KIN} ##### Sir William Lyne: -- What has he given away ? {: .speaker-KXO} ##### Mr PAGE: -- He has told the Committee that if the proposed bounty is not agreed to, 150 men will be thrown out of employment. This is merely an attempt on the part of the Treasurer to secure by a side wind protection for the local manufacturers of wire netting. As long as I represent a pastoral constituency no vote of mine will be cast for the imposition of a duty on wire or wire netting. Such an impost would be in the nature of a class tax. Is the honorable member for Batman aware that tens of thousands of men, women, and children, and not a mere 150 men, are dependent for a living upon the pastoral industry, and that it is only by the use of wire netting that they are able to fight the rabbit invasion ? I have no desire to destroy any industry. This Bill has been introduced to encourage the Australian iron industry, which is certainly a worthy one. I should like to see it nationalized, but, failing that, I am prepared to do the next best thing - to assist in the establishment of the industry so that it may be nationalized at some future time. As to the statement that the acceptance of my amendment would lead to 150 men being thrown out of employment, .1 should like to ask the honorable member for Batman what those men have been doing up to the present? {: .speaker-K5J} ##### Mr Coon: -- They have been out of work. {: .speaker-KXO} ##### Mr PAGE: -- Are the Lithgow works closed down? {: .speaker-K5J} ##### Mr Coon: -- Not yet. {: .speaker-KXO} ##### Mr PAGE: -- Then how can these men be out of employment? Whilst in Queensland, I saw in the newspapers a paragraph to the effect that the wire used in the local industry was not coming to hand according to contract, and that the manufacturers wished to substitute imported netting for that which they had arranged to supply. The honorable member for Batman would give them a bounty of 10 per cent, on wire netting made from cheap German wire, or wire imported from some other country competing with Great Britain. {: .speaker-K5J} ##### Mr Coon: -- No; British-made wire. {: .speaker-KXO} ##### Mr PAGE: -- My amendment is purely Australian in sentiment, but I propose to amend it by providing that the bounty shall be paid in respect of wire netting made from Australian ore, "or Britishmanufactured wire." {: .speaker-JWY} ##### Mr Chanter: -- And the honorable member would put the word "wire," now appearing in the schedule, in a separate line. {: .speaker-KXO} ##### Mr PAGE: -- Yes. Will the honorable member agree to the amendment as I propose to amend it? {: .speaker-KIN} ##### Sir William Lyne: -- We have already inserted an amendment after the word wire - namely, the words " not being prisonmade," so that I do not think it would be possible at this stage to do what the honorable member desires. {: .speaker-KXO} ##### Mr PAGE: -- Then will the Government agree to recommit the paragraph so that the further amendment may be dealt with? {: .speaker-KFK} ##### Mr Groom: -- Yes. {: #debate-9-s30 .speaker-KUF} ##### Mr SPENCE:
Darling .- It has always been understood that the granting of a bounty is designed to encourage an industry in its initial stages, and if we are to encourage this industry, we ought to provide for a bounty to be paid on the manufacture of wire from Australian iron. We have had from the honorable member for Batman a confession that this industry, which has been established for many years, is unable to carry on unless the taxpayers contribute to its support. The Treasurer stated that both the period and amount to be paid are limited. If we are to adopt the principle that an industry which has been established for years, and paying, according to the honorable member for Batman, good wages - although that is news to us - is to come to the taxpayer for assistance because it discovers that it cannot continue, let us understand it. It will mean entering into a permanent contract to assist the industry, because when the bounty expires those concerned will come to Parliament again, and plead that the 150 employes will be thrown out of work unless further assistance is given. We have heard, by interjection since the honorable member for Batman sat down, that these men are out of work, and, consequently, getting no wages, whereas the honorable member said previously that they were getting £3 a week. Let us do things with our eyes open. If we are going to interest ourselves on behalf of the taxpayer in various industries where private enterprise has to acknowledge that it has been a dead failure, and appeals to the public to help it to pay the wages, let us shape our proposals accordingly. We aits departing entirely in this item from the principle of bounties. It would be well worth while to offer a bounty for the manufacture of wire. That is a much more important and costly undertaking than the mere weaving of the wire, after it is made, into wire netting. It would' be much more advantageous to the country to give a bounty for the making of wire than for the secondary industry of making wire netting. The Bill begins at the wrong end of the business. In spite of the assertions of the honorable member for Batman, the wire netting factory in New South Wales has been at work for a great number of years. The honorable member did not mention the well-known fact that the ex-Premier of New South Wales, instead of encouraging the local firm, imported wire netting wholesale from wherever he could get it. That gentleman was not concerned in the least whether those 150 employes had work or walked the streets, and we are appealed to now to keep them in work. We should look into the matter to see where we are drifting. It would be better for the honorable member for Maranoa to separate the proposal for a bonus on wire made from Australian ore from the question of a bonus for wire netting. {: .speaker-KXO} ##### Mr Page: -- I have separated them. {: .speaker-KUF} ##### Mr SPENCE: -- Then I am altogether with the honorable member. Many thousands of people have a direct interest in getting wire netting as cheaply as it can be made. They would like to see it made in Australia, but the question affects far more than the particular interests of one factory, although, of course, we should like to help that to continue. I ask the Treasurer to offer an inducement in the Bill to the Sheffield firm that has been mentioned to erect a plant in Australia for the manufacture of wire. I see no reason why they, should not come here. There will be, for years, a considerable demand in Australia for iron wire of all sizes, and also for wire netting. ' There is a good opening for that firm if adequate encouragement is offered them. I should be prepared to give a good bounty with that object, and then the wirenetting industry would be associated, as a secondary one, with the wire-making industry. If we are to be asked to adopt the principle of assisting industries already established, I can bring along my shearers, 40,000 strong, who particularly deserve a bounty, seeing that they get only three months' work in the year. The idea that an established and growing industry should appeal to Parliament for a bounty to help it pay wages, on the plea that otherwise men will be thrown out of work, seems ridiculous. Why does not private enterprise confess at once that it has been a failure, and give up decently, instead of appealing for State aid in this piece-meal fashion ? {: #debate-9-s31 .speaker-JWY} ##### Mr CHANTER:
Riverina .- The honorable members for Balaclava and Grampians were unduly severe on the honorable member for Batman. From what I heard on one occasion, I can corroborate that honorable member's statements in regard to the Sydney wire-netting industry. I heard three of the men who were deputed by all the employes a( those works to come to Melbourne and place before as many honorable members as possible the true history of the industry. The wage sheet produced is the correct one, but, in consequence of the reduction of the duty previously imposed, the men admitted that the employers, although doing their best to keep the works going, could give them only half time. {: .speaker-JWG} ##### Mr Fowler: -- The cause was the shortage of the raw material. {: .speaker-JWY} ##### Mr CHANTER: -- That was only partly the reason. The extreme dumping of inferior wire netting, made in Germany, and put on the market at such prices as the Sydney firm could not possibly compete against at a profit, was the real reason. When in Sydney, I went to the trouble of going through the books, and I can state that the company, in order to keep the concern going, and in the hope that they would get some assistance from the Australian Parliament, were absolutely compelled to sell netting at less than it cost them to manufacture. They were holding the fort until they could get into a position to meet their competitors on fair and even ground. {: .speaker-KJ8} ##### Mr Hutchison: -- Where do they get their wire from? {: .speaker-JWY} ##### Mr CHANTER: -- They have to import it, but whether it comes from the United Kingdom or Germany 1 do not know. I am in favour of the amendment, but I suggested - and that suggestion has been approved of by the Government - the separation of "wire" from "wire netting," so that the wire netting could be manufactured either from Australian-made wire, or from wire manufactured in the United Kingdom, while in a separate line we could offer a bounty on wire made from Australian ore, in order to encourage the erection of a plant to manufacture wire, which the Sydney and other firms could afterwards use as the raw material to weave into netting. The men at the Sydney establishment speak highly of the way they have been treated, the wages that they were paid, and the desire of the proprietors to give them as much work as possible. I have explained how the firm are now prevented from giving the men full work. The large importations of wire netting by the State Government, as mentioned by the honorable member for Darling, were also a factor in lessening their trade. As this is an established industry we should, in the meantime, assist it to give the men already in employment full time, and, if possible, to ' enlarge their premises, with a view to the employment of more men. Then, after a reasonable time hasbeen allowed to others to begin themanufacture of wire from native ore, the makers of wire netting will be in> a much better position to expand their industry. This industry has had a varied'experience. Its career has been like a switchback railway. It has been assisted' by the Government temporarily ; it hassometimes been protected by a duty, and then the duty has been withdrawn, so that the firm have never known where they were. They have 'been honestly led to believe, not only by this, but by other, Parliamentsthat they would get assistance, and they have hung on in the hope that they would' be enabled to establish themselves to meet the competition of the imported inferiorarticle. The honorable members for Balaclava and Grampians - I am sorry that they are not now present - spoke from acountry point of view ; but so do I, and *I* have had a long experience. Those whohave used the imported German wire netting, which is sold at dumping prices, and' used also the honestly manufactured netting of Sydney, will admit at once theimmense superiority of the latter. Thehonorable member for Batman has supplied1 me with samples of the two. The difference between them is apparent. The Treasurer and others can bear out my statement that the Australian netting i vastly superior to that which comes from Germanyand which has been sold at a lower price.. Another phase of the matter to which - serious attention must be given is the fact that the netting made in German v, and exported to Australia, is bounty-fed. Our manufacturers cannot meet such competition without assistance, and it is proposed. in accordance with an amendment which II *»m* glad r h ; i r the Government has accepted:, that a bounty shall be given on nettingmanufactured from wire imported from theUnited Kingdom, and a bounty offered for wire manufactured from Australian pig: iron. I hope that the latter bounty willinduce some capitalist to erect here a plant for the manufacture of wire, so that withina year or two we shall be able to compel1 the makers of wire netting who claim assistance to use only Australian-made wire. When Australia is getting wire nettingmade from wire manufactured from local' pig iron, her farmers, graziers, and otherproducers will be able to obtain their fencing material cheaper than it is at present,, and the primary industries will benefit accordingly. {: #debate-9-s32 .speaker-KCO} ##### Mr GLYNN:
Angas -- I see no objection to the proposed amendment of the honorable member for Maranoa, but its terminology requires some alteration. {: .speaker-KXO} ##### Mr Page: -- The Attorney-General has promised to draft a provision which will meet the case. {: .speaker-KCO} ##### Mr GLYNN: -- I was going to suggest that it will be sufficient to insert the words - and being made from Australian ore, or, in the case of wire netting, from wire manufactured in the United Kingdom. The word " British," under the Acts Interpretation Act, does not include Ireland. As originally introduced, the Bill was merely a measure to encourage the manufacture of certain articles, the words " in Australia " being subsequently inserted to meet an obvious oversight. In the first part of the schedule we offer a bounty for the production of pig iron from Australian ore, and why should we not apply the principle by encouraging the use of such pig iron? In Canada, where a higher rate of bounty is given for the manufacture of articles from pig iron made from Canadian ore than for articles made from pig iron made from imported ore, in 1902 about 46,000 tons of the former was used, as against 276,000 tons of the latter. That shows what a farce the bonus system introduced into Canada in 1884 has proved. It has really encouraged the importation of foreign ore, the pig iron made from it being exported on many occasions to be dumped into the United Kingdom. I shall support the amendment, although it is a little inconsistent with some of the provisions of the Bill. The proposed bounties are nominally to operate only for a time; but, in ray opinion, like those of -Canada, they will be retained for all time. Were the Ministry conscious of the developments of its policy, it would probably commit political suicide ; but Providence having blessed Ministers with but a limited vision in these matters, we must assume, as they do, that bounties will not be perpetual, and that after a time import duties will take their place. Import duties, however, will not affect this particular bounty, because we are providing that the goods must be manufactured from Australian ore, and it is beyond the bounds of credibility that our ore will be exported to be made into pig iron to be subsequently imported. {: #debate-9-s33 .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- I do not think that the honorable member for Batman furthered his cause by the extremely biased manner in which he presented the claims of the company which he has chosen to champion. Honorable members are better informed than he supposes. I need not repeat the details put before the Committee on other occasions ; but it is well known that the New South Wales manufacturers of wire netting were not long since charging from *£4°* to £45 per mile retail for their output. Notwithstanding that prices were so high, and that there was so great a demand for the netting that orders had to stand over for months, the firm treated its workmen so badly that they felt compelled to strike. A firm which treats its men decently, sharing with them its profits, will be fairly treated by Parliament; but when a firm not only charges the consumer too much, but at the same time grinds the faces of its workmen, it is not likely to get much consideration from the party with which I am associated. The utterances of some of the employes of this firm in respect to the conditions under which they were compelled to work are recorded in *Hansard.* Some of them, rather than stay in the firm's employ, went to work in the sugar industry up north, an industry in which, we have been told, only black labour should be employed. {: .speaker-K5J} ##### Mr Coon: -- But things have changed for the better since then. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- The price of wire netting is much less now than it was then. Formerly conditions were so bad that the Government of New South Wales, although opposed to the policy of State interference, and supporting the view that private enterprise should be left unhindered, felt it necessary, for the protection of the thousands of its producers who were suffering from the depredations of rabbits, to make arrangements for the importation of netting from the old world. This was placed at the disposal of farmers and graziers at a price much less than the local manufacturers were charging, deferred payments being allowed. The local firm tendered for the supply of wire netting for £31 10s. a mile; but the Government found that it could import netting of equally good quality, and sell it free on train for' £26 a mile, while at the present time prices are still lower. Had the New South Wales firm in its time of prosperity, when it enjoyed practically a monopoly, dealt fairly with its work people, instead of sweating them, and had it charged less for its production, it would command more sympathy now. The honorable member for Batman has spoken of the difficulty it has to carry on its business at present. He says that without assistance such as is proposed, men will be thrown out of work. The Treasurer has admitted that in the past the company incurred huge liabilities with which it is now faced. {: .speaker-KUF} ##### Mr Spence: -- That is due to bad management. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- That may be so, but whatever the cause, we are now being asked to assist a company, not to carry on its present industry, but to make up for losses incurred in days gone by. Whatever may be the requirements; of this particular firm, the needs of the primary producers are more urgent. It is essential that they should be able to obtain their wire netting at a reasonable price. They do not ask for it at a price which would require its manufacture by men receiving sweating wages ; but they do not wish to be charged as much as they had to pay prior to the intervention of the State Government. Wire netting is required in order to carry on the industries of the primary producers ; and if the honorable member for Batman desires to consider the majority of the people, who are vitally concerned, he will lift his eyes beyond the small manufacturing section to which he has referred - beyond one company and one small section of the community. I could refer the honorable member to information supplied by the , workmen themselves, as to the conditions under which they are employed and the wages they receive; and that information, I think, would be the most practical reply that could be given to the statements which have been made. We are asked to offer a bounty to an industry natural to the country ; and, beginning with the iron, we go by stages to the completed articles, including wire netting. There must, of course, be wire, on the production of which there is a bounty. But there are honorable members who seem prepared to " jump" the manufacture of the wire, and restrict the bounty to the weaving, irrespective of where the wire comes from. Those honorable members claim to be preferential traders ; and they have now offered to them an opportunity to give practical expression to their principles. If the proposal be passed without any qualification, the effect will be to give a bounty on wire netting weaved from what protectionists in this Chamber have described as rubbishy German wire. I am prepared to adopt the proposal of the honorable member for Maranoa. In my opinion these two items should be separated, so as to avoid confusion ; and we ought to give a substantial bounty on Australian-produced wire. Until we are in a position to produce wire, I am prepared to give a bounty on wire netting, but on wire netting made not from foreign rubbish, but from British manufactured wire. If the Treasurer is prepared to meet the Committee to that extent, I can give him my support, but not otherwise. {: #debate-9-s34 .speaker-KGZ} ##### Mr HEDGES:
Fremantle .- The Treasurer first of all impressed on us the fact that the iron deposits at Blythe River, Tasmania, were as good as any in the world, according to the tests made ; and that he understood there had been a drive put in for about 600 feet. Further on in his remarks on a former occasion, he referred to the great imports not only of pig iron, but of bar iron ; and I particularly wish to point out that the honorable gentleman asserted that we have all thenecessary raw material for the manufactureof iron. The Treasurer, as reported ire *Hansard,* also said that the old Bill provided for a bounty for the production of wire netting, whereas he now proposed to. have a bounty on the production of the wire as well. That being so, one would! naturally think that the wire must be madefrom Australian ore; and I claim that it is most essential that wire should be madein Australia. The tendency now is to cut up large estates, and I suppose that thereis ten times *as* much fencing done now asever before. The netting should certainly be made from Australian wire. {: #debate-9-s35 .speaker-F4P} ##### Mr REID:
East Sydney .- According to the Bill, there is a bonus of 10 per cent, to be given, but that includesthe value of the foreign wire. Surely honorable members would not consent to givea bonus of 10 per cent, on the value of foreign wire imported into Australia. {: .speaker-JSM} ##### Mr THOMAS BROWN:
CALARE, NEW SOUTH WALES · ALP -- That will be the effect unless we provide otherwise. {: .speaker-K4I} ##### Mr HUME COOK:
BOURKE, VICTORIA · PROT -- I do not know exactly what the Treasurer said, but I" understand that he proposes to recommitthe item with a view to altering the wording, so as to make clear his intention. {: .speaker-F4P} ##### Mr REID: -- I have not heard what theproposed alterations are ; but I understand-) that the Crown Law officer's were consulted in this matter. It is obvious that, if the netting is not to be made of Australian wire, the bonus of 10 per cent, will be paid on foreign-made wire. According to the Bill, the bounties are limited to goods manufactured! in Australia ; and, consequently, the principle of the measure is that the goods are to be manufactured here. It will be seen, however, that in the case of wire netting, that principle is departed from, because the most important part of the manufactured article is not made here. If honorable members look at the other lines, they will see that_ the pig-iron must be made from Australian ore, that the puddle-bar iron must be made, from Australian pig-iron, and that the steel must be made from Australian pig-iron- the raw material is Australian all ' through. {: .speaker-KGZ} ##### Mr Hedges: -- What about the iron and steel tubes? {: .speaker-F4P} ##### Mr REID: -- The case of iron and steel tubes is governed by clause 3. {: .speaker-K4I} ##### Mr HUME COOK:
BOURKE, VICTORIA · PROT -- lt is proposed to add words providing that iron and steel tubes shall be made from Australian pigiron or steel. {: .speaker-F4P} ##### Mr REID: -- I was not aware of that ; but it is a sudden change, seeing that the Treasurer was championing the policy of giving a bonus On imported wire. The honorable gentleman pointed out that the bonus was good for only a certain number of years, and that it would take longer than that to provide the necessary machinery. It is extraordinary that the Treasurer should have so completely changed his attitude; but, if he has done so, the change will bring this line of the schedule into harmony with the other lines. {: .speaker-KFN} ##### Mr FOSTER:
NEW ENGLAND, NEW SOUTH WALES · ALP -- The Treasurer has agreed to do so. {: .speaker-F4P} ##### Mr REID: -- I was not aware of that; because the last word I heard from the Treasurer was distinctly in another direction! However, if the Treasurer has given way, I have nothing further to say. {: #debate-9-s36 .speaker-KFN} ##### Mr FOSTER:
NEW ENGLAND, NEW SOUTH WALES · ALP -- I understand the amendment to be to include the words " wire netting made from British manufactured wire, and wire made from Australian ore." {: .speaker-10000} ##### The CHAIRMAN: -- Those words were suggested, but not formally moved; the only words moved were " and made from Australian ore." {: .speaker-KXO} ##### Mr Page: -- I moved additional words, and they were accepted by the Government. {: .speaker-10000} ##### The CHAIRMAN: -- Then the amendment will read "made from Australian ore or British-made wire." Amendment agreed to. Amendment (by **Sir William** Lyne) moved - >That after the word "diameter" the words "made from Australian pig-iron or steel" be inserted. {: #debate-9-s37 .speaker-KGZ} ##### Mr HEDGES:
Fremantle -- * fail to see why this provision should be limited to pipes of not more than 4 inches internal diameter. The manufacture of larger pipes is of equal importance. I am satisfied with the proposal that the bounty shall be paid in respect only of pipes made from Australian ore; but object to the restriction of size. I wish to propose that the limitation as to diameter be omitted. {: .speaker-10000} ##### The CHAIRMAN: -- Such an amendment can only be moved on the Treasurer agreeing to withdraw that submitted by him. {: .speaker-KGZ} ##### Mr HEDGES: -- Will the Treasurer agree to my proposal ? {: .speaker-KIN} ##### Sir William Lyne: -- No. {: .speaker-KGZ} ##### Mr HEDGES: -- Various large water conservation works are in progress in New South Wales and other parts of the Commonwealth, and there is likely to be a big demand for much larger pipes than are mentioned in this schedule. Why should we not encourage the manufacture of larger and heavier pipes? I hope that the Treasurer will agree to my proposal. {: .speaker-KIN} ##### Sir William Lyne: -- Let it go.' {: #debate-9-s38 .speaker-KXO} ##### Mr PAGE:
Maranoa -- I think' that the argument advanced by the honorable member for Fremantle is worthy of consideration. A short time ago, in Brisbane, there was a large demand for. 6-inch, 8-inch, and 12-inch cast-iron water pipes, and I fail to see what . objection there can. be to the proposal to extend the diameter of the pipes to which this provision shall apply. Amendment agreed to. {: #debate-9-s39 .speaker-JX9} ##### Mr FRAZER:
Kalgoorlie .- Before the question - " That the schedule, as amended, be agreed to " - is put- {: .speaker-KIN} ##### Sir William Lyne: -- That will be only a formal matter; I am going to recommit the Bill to-morrow, or whenever I can get at it. {: .speaker-JX9} ##### Mr FRAZER: -- Do I understand that the Treasurer recognises that the schedule is not in the form in which it should be finally passed? {: .speaker-KIN} ##### Sir William Lyne: -- I have said that I will recommit it to-morrow. {: .speaker-JX9} ##### Mr FRAZER: -- For the purpose of dealing with the question of percentages? {: .speaker-KIN} ##### Sir William Lyne: -- And there are a good many other amendments. Schedule, as amended, agreed to. {: #debate-9-s40 .speaker-JX9} ##### Mr FRAZER:
[Kalgoorlie .- In the event of the Bill being reported to the House with amendments, what procedure will be adopted ? {: .speaker-KIN} ##### Sir William Lyne: -- I shall move to recommit the Bill for certain purposes. {: .speaker-JX9} ##### Mr FRAZER: -- To amend the schedule ? {: .speaker-KIN} ##### Sir William Lyne: -- I shall not confine myself to that ; there are one or two other matters to.be dealt with. Bill reported with amendments. House adjourned at 11.3 p.m.

Cite as: Australia, House of Representatives, Debates, 5 November 1908, viewed 6 July 2017, <http://historichansard.net/hofreps/1908/19081105_reps_3_48/>.