8th Parliament · 1st Session
Mr. Speaker (Hon. Sir Elliot Johnson) took the chair at 11 a,m., and read prayers.
– In view of the seriousness of Sir John Higgins’ proposed remedy for the wool crisis, which the Prime Minister says he is not sure will cure the disease, will the Acting Prime Minister, before introducing a Bill to restrict the exportation of wool, give ample time to all the interests affected to put their case before the Government?
– The matter to which the honorable member refers is one of the most important with which this House has had to deal. I think that the debate on it should proceed to-day; and after the discussion has informed the mind of Ministers, the Government will take the whole subject into consideration. Because of the seriousness of the matter, I do not propose to do anything hastily. On the other hand, action cannot be deferred too long. Ministers must try to obtain from every quarter all available information, and then make up our minds, as soon as we can, as to the course to be followed. My attitude now is one of entire open-mindedness. I shall listen to the forthcoming debate with the greatest interest, so that I may be fully informed before a determination is come to as to the course to be taken.
Mr.RILEY (for Mr. Lavelle) asked the Minister for the Navy, upon notice -
Whether he will inform the House when the additional 8s. per week granted by Award No. 405 of 1921, dated 3rd March,1921, will be paid to the employees concerned?
– The Department of the Navy is paying all awards by Arbitration Courts. If the question refers to a decision of the Shipbuilding Tribunal, the subjectmatter is under consideration.
asked the Acting Prime Minister, upon notice -
Whether he will institute inquiries concerning the overweight of bags of wheat, according to the standards adopted, at PortPirie, consigned per s.s. Roserie, 28th March last, wherein a whole truck load was found to be overweight, some bags to the excess of 13 lbs.; also pership Manicia, on 20th instant?
– Yes. Inquiries are being instituted in connexion with the matter.
asked the Post master-General, upon notice-
– The answers to the honorable’ member’s questions are as follow: -
asked the Minister representing the Minister for Defence, upon notice -
Will he arrange to have the British Army Act (if it is proposed to incorporate it in our Defence Act) printed and circulated among honorable members?
– The clauses which embody the Army Act in the Defence Bill are still under consideration of the Senate, where certain copies of the Army Act have been made available to senators. Before the Bill reaches this House the honorable member’s suggestion will be considered.
– I lay on the table the following papers:-
Peace Treaties. - Papers relating to Signing and Ratification of the Peace Treaties-
Memorandum dated 12th March, 1919, circulated by Sir Robert Borden on behalf of the Dominion Prime Ministers.
Rules of the Peace Conference contained in Annex II. to Protocol I. of the Conference, defining the position and representation of the several Powers, including the Dominions (dated 18th January, 1919).
Correspondence between the Commonwealth Government and the Secretary of State for the Colonies concerning the signing and ratification of the Peace Treaties.
Order in Council passed in Australia, moving His Majesty the King to issue letters patent appointing plenipotentiaries in respect of the Commonwealth of Australia.
The papers which I am now presenting are all the documents of the kind that are in the possession of the Government. We have not some of those referred to by Professor Harrison Moore, and therefore they cannot be laid on the table.
Ordered to be printed.
The following paper was presented : -
Audit Act. - Regulations amended. - Statutory Rules, 1921, No. 49.
Debate resumed from 28th April(vide page 7872), on motionby Mr. Hughes -
That the following paper be printed: -
Wool. - Resolutions of a meeting of woolgrowers held at Parkes (New South Wales) on the 23rd April, 1921, with reference to the Wool Growing Industry.
Mr. TUDOR (Yarra) [11.51.- I do not think that a more important statement than that of the Prime Minister, yesterday, was ever delivered in this Chamber. It was in the nature of an interim Budget, giving information upon various matters in which the countryis deeply interested. The Prime Minister addressed himself to the subject of economy. I can tell the Government how it could save £100,000, though the members of the Country party would not vote for my proposal.
– My suggestion is that, instead of electing a Federal Convention to frame an amended Constitution, the work should be left to Parliament. The election of delegates to the Convention would cost at least £100,000, and the holding of the Convention a sum probably quite as large.
– The holding of the Convention may be allowed to stand over for a time.
– The time for the remodelling of the Constitution has arrived. The Prime Minister has stated that to be his opinion, and I think that the great majority of honorable members agree with it. No one knows better than the members of this Parliament, some of whom have been working under the Constitution ever since it was adopted, and others for shorter periods, what amendments it needs. Probably a certain proportion of members will be elected to the Convention; but, in addition, outsiders will be elected who know nothing of the subject.
– Theymay know more.
– That remark is a gross reflection upon the honorable member himself.
– I am speaking of members of the Opposition, as well as of those on this side.
– A member who thinks that outsiders may know more of the working of the Constitution than he does has no right here; his proper position is outside. The Prime Minister stated that of the £98,000,000 we are spending this year, £90,000,000 had been allocated by this Parliament. That may be so, but, nevertheless, blunders may have been made, and I maintain that there have been blunders. When there is large expenditure such as that on Defence, mistakes are bound to be made. Some of the mistakes of the Ministry are indefensible, and should be remedied as soon as possible. The Prime Minister says that £63,000,000 of the present year’s expenditure is due to the war. If money is rightly spent, I do not object to its expenditure, but some of this, I think, has been wrongly spent. We find money for the States to spend on land settlement, and that arrangement is bound to cause reckless expenditure. I pointed that out at the time it was entered into, and I do not refer to it now merely for the satisfaction of saying “ I told you so.” Unfortunately, my remarks have been justified. I admit that it would have been difficult to avoid what has happened.
– The States will not let us deal with their land.
– That is so.
– A good job, too.
– They have to repay the money advanced to them, and are responsible for its expenditure.
– Yes, but they are also responsible for £18,000,000 which they borrowed in 1914 under a promise of repayment in 1917, and they have not yet repaid a penny of the amount. Similarly, they will wriggle out of this other obligation if they can.
– They pay interest on their borrowings.
– Yes, but they promised to repay the principal in 1917. My right honorable friend was present in the Senate club-room when the promise was made. So long as one Government finds the money and another spends it, the tendency to extravagance will be greater than usual. .The Prime Minister tells us that over £5,000,000 per annum goes in pensions. I am in favour of spending more than that in pensions, and I would allow the pensioners to earn, in addition to their pensions, a sum proportionately as great as they were allowed to earn in 1908. The original pension rate was 10s.’ per week, and it was subsequently raised to 12s. 6d., and then to 15s. per week, because of the decline in the purchasing power of money; but the pensioners are not allowed to earn more than they were allowed to earn in the first instance, sol that they are worse off than they were, because the 15s. which they now receive is worth only as much as 10s. was in 1908, and what they are allowed to earn now is worth less than what it was then. The Government professes to desire economy, and yet the payment of war pensions was transferred from the Old-age Pensions Department.
– By which the pensions were splendidly administered.
– Yes. That was done to create a new Department, which, I understand, is not so well managed.
– Not nearly so well managed.
– Of what use is it to prate about economy and then to unnecessarily create a new Department?
– Was a new Department created for the paying of war pensions ?
– Yes, and you cried for it.
– No new Department was created.
– And there has been no addition to the Commonwealth Public Service.
– Not any. There was merely a transfer of duties from one Department to another.
– The work of paying - war pensions was transferred to the Repatriation Department to justify its continuance. I hope that when the Government practise economy, they will practise it fairly and not fool with it. I would like to know what some of the new departments, such as the Board of Trade, the Bureau of Commerce and Industry, and the Institute of Science and Industry, have done to justify their existence. I am in favour of the Institute of Science and Industry, provided that the right man is appointed to control it. I do not desire to reflect on Mr. Knibbs in any way, or to advocate the claims of any other man, but at the Government laboratory there is a man who, as a scientist, stands head and shoulders above Mr. Knibbs. The Prime Minister said that £14,000,000 was required for the Postal, Defence and Navy Departments. More economy could be practised in the Defence Department. Let any honorable member who is unknown at the Department go there to make inquiries and he will be sent from pillar to post. “ Send the fool further” is apparently the game that is played there. Some of the officers will not deal fairly with a man unless they know that he has somebody’ with influence behind him. In order to economize in the Defence Department, every general and brigadier-general has been retained, but the privates have been dismissed 1 As a further means of economy, it is proposed to hold a seventy days’ camp, and as long as the generals rule the roost that camp will be held.
– Is the honorable member referring to generals who were civilians before the war?
– I refer to the lot. Directly a man steps out of civil life to take up the profession of a soldier he becomes a professional soldier, and there is a great number of such men in. the Department to-day. If a return were prepared of the generals employed in the Department, and the salaries they are receiving,’ it would show one direction in which a great deal of economy could be effected. Before the war there was only one general in the Department.
– If generals are not to rule the roost, who are? Privates?
– The people of Australia, and I shall do my best to see that they do rule the roost, even in preference to such a fine fellow as the Assistant Minister. I agreed with the Prime Minister’s statement that more money should be made available for the Postal Department. He said that honorable members are never happy, except when they are asking for increased postal conveniences. That remark applies to some honorable members more than to others; but there are grave complaints about the telephone system all over the Commonwealth, in city, suburbs and country.
– The honorable member ought to try to use the telephone system in Sydney.
– I know what the Sydney system is like.
– Another instance of Government control.
– The honorable member has recently conducted an inquiry into wooden shipbuilding, in which private enterprise was so successful that one ship had a hump on its back. That is an instance of what private enterprise can do.
– Under . Government supervision.
– If there were not Government supervision over some of these builders the boats would go ‘down as soon as they left the harbor. They would be only _ coffin ships ; I certainly would not sail in them. We heard a great deal about the use of dummy bolts and other defects, and the honorable member places the blame upon the Government supervisors.
– A certain amount of responsibility must rest upon the Government.
– The honorable member reminds me of an anecdote concerning a man for whom a house had been built which fell down as soon as the scaffolding was removed. When he complained to the builder, the latter asked him if he had papered the house. The owner replied “No.” The builder said, “ That explains the collapse; if you had papered the house it would not have fallen down.” The honorable member for Dampier is applying the same argument to the construction of these ships, removing the responsibility from the builder to the owner. As the Prime Minister said, more money is required for the Postal Department. The men who conduct the allowance post offices should be treated more generously. I can speak disinterestedly on that point because there is not one postal contractor in my electorate.
– The great need is for an improvement in the telephone service.
– The telephone system ought to be brought up to date. If it is true that the telephone charges in the Commonwealth are less than in other parts of the world and that the service is not paying its way, the fees should be increased. As a telephone subscriber I say that.
– I cannot credit the figures which have been quoted regarding America because telephones are so popular there, being installed in almost every home.
– I could never use a telephone in London for less than threepence a call.
– I believe that the minimum charge is threepence in London. The Prime Minister said that a reduction of the salaries of the Public Service and members of Parliament has been suggested. I am not in favour of the reduction of either. I desire the Public Servants and all other people in the community to receive the basic wage that was recommended by the Commission appointed by the present Government on the eve of the last general election. The Prime Minister said that if Australia is to have industrial peace it must be prepared to pay the price. I am in favour of everybody in the community receiving the basic wage.
The Wheat Pool has not been very satisfactory. We are told that the accounts for the 1916 pool have not yet been finalized. Do honorable members know why? Wheat to the value of £200,000 or £300,000 was sold to Roumania and the Roumanian bonds which were tendered in payment have gone astray. It is quite possible that they were not worth the paper on which they were printed.
– The wheat was bought by the Imperial Government, and the missing bonds represent only our share of the excess profits.
– I understand that the Imperial Government re-sold the wheat to Roumania and we have not received the money that is due to us from Roumania. That is why the 1916 Pool has not been cleared up. The price of wheat in 1916 was 4s.11d. per bushel; 1917, 4s. 3d. per bushel; 1918, 4s.11d.; 1919, 5s. 7d. ; and in 1920, 6s. 8d. Those were the prices received during the five years in which the Pool had complete control. Members of the Country party have stated that the Australian people have been saved a great many millions of pounds by getting cheap wheat.
– There is no question of that.
– The honorable member spoke of a sum of £13,000,000, and he included in that the value of the 10,000,000 bushels of seed wheat which went to the farmer. The Australian requirements for wheat and flour total 35,000,000 bushels per annum, so that two-sevenths of the total consumption go to the farmer and. benefit himrather than the consumer. I suggest that when the honorable member again quotes those figures he should reduce the amount by one-third.
– How much seed wheat did the Government handle for the farmer? Every farmer looks after his own seed, which does not go into the Pool at all.
– But it has been reckoned in the total as if it had gone into the Pool. We are told that the average price of oversea sales from the present Pool has been 9s. 3d. per bushel. That is due to the fact that in the early part of the year wheat was sold to France, our ally, at 14s. per bushel, in order that, later, wheat might be sold to Germany at 7s.
– The world sells at the market value from time to time.
– The people in Australia have not been charged the market value from time to time.
– They got their wheat for less than market value for five years.
– The Australian people did not get their wheat for less than the figures I have quoted as the fixed prices for the five years. We are told that in future the price of wheat for home consumption will be fixed at the London parity from month to month. If it is right to do that in future it should have been done in the past.
– Will the honorable member state what other countries paid for wheat during the same period ?
– I am more interested in Australia than in other countries.
– The price for local consumption was fixed by two Labour Governments.
– How could two Labour Governments outvote five anti-Labour Governments ?
– By the guarantee they gave to pay the farmers 7s. 6d. per bushel.
– All the State Governments have guaranteed to pay the farmers 9s. per bushel for twelve months for wheat for local consumption.
– They have bought the wheat on the State markets.
– Yes, but they have the right to sell to the millers, and the millers have the right to sell to the bakers, who can charge as much as they like for the bread they make. The difference ought to be made up out of the general revenue of the country. I think my friends in the corner would agree to that proposition. The Labour party would certainly be agreeable to it. It should also be acceptable to the State Governments. At any rate, the people who are least able to afford the money ought not to be called upon to meet the difference in price.
– Is it not a fact that the Queensland Government and the New South Wales Government could, if they chose, bring down the price of wheat in their States?
– Yes, but why do they not do so ? They are probably swayed by the same reasons which actuate the Governments of Victoria, South Australia, Western Australia, and Tasmania.
– The position is not the same in regard to those States.
– That is so, because they have not given any guarantee.
– The whole trouble is the guarantee.
Honorable members interjecting,
– I do not know why it is that, on every Friday morning there is the same trouble. It is almost impossible for an honorable member to speak with any reasonable freedom from interruption. I appeal to honorable members to refrain from interjecting. Each interjection brings a chorus in reply and so much disorder that it is almost impossible for me to hear the debate. I shall name the next honorable member who interjects after I call for order.
– Yesterday the Prime Minister told us that 50,000,000 bushels had been sold last month at an average price of 9s. 4d. f.o.b. Melbourne, and 30,000,000 bushels for home consumption at 9s. a bushel. That would mean that 80,000,000 bushels had been sold at a price averaging over 9s. a bushel, but we have been informed that 210,000 tons, or 7,840,000 bushels, have been sold to Germany at a price of 7s. 9d. per bushel f.o.b. for the major portion of it, and 7s. 6d. f.o.b. for the balance. The German buyers have thus had the advantage of any reduction in freights.
– They are still at a disadvantage in regard to rates of exchange.
– France is in the same position in that respect.
– That is so. If we secure an advantage from Germans because of the low rate of exchange with Germany, we are also deriving an advantage from our sales to France, because the exchange value of the franc is about 50 francs to the sovereign.
I understand that the honorable member for Grampians (Mr. Jowett) intends to speak upon the question of wool. We heard a very interesting address in another part of this building this morning upon this subject. I am not sufficiently acquainted with the wool question to dogmatize upon it, but the Prime Minister told us yesterday that all sections of the community are interested in it, and I realize that if wool has no value Australia must suffer a stringency which is liable to affect every individual in the community. I suggest to the Government the advisability of appointing a Committee of members of this House and the Senate who are interested in the various branches of the wool industry, as workers, growers, fellmongers, or manufacturers. They might be able to suggest some means of getting over the present difficulty. I agree with the Prime Minister that if we have 3,000,000 bales of wool in Great Britain belonging to Bawra, it would be better to hold it up for some time, particularly, as I understand, that the people who own it have already received from the sale of their wool prior to this accumulation sufficient money to enable them to do this. If it is true, as has been stated in some quarters, that in various parts of Australia wool is being burnt and hides are being destroyed, the persons acting in this way ought to be prosecuted, because the man who burns wool is guilty of arson just as much as is a man who sets fire to a house.
– Would the honorable member take away the wool if it were given to him for nothing?
– The pastoralists will give their wool to the honorable member to getrid of it.
– The pastoralists are not burning anything of any value.
– It is just as well to get the views of honorable members upon this matter.
– A farmer might just as well be prosecuted for burning rubbish on his farm.
– We must see that justice is done to Australia. The whole of the House could not arrive at a solution of the trouble as well as could a small Committee such as I have suggested. I hope that my suggestion will be adopted, and that the Committee will get to work speedily and recommend a means by which the wool of Australia can be sold’ with advantage to the Commonwealth.
.- I thank the honorable member for Yarra (Mr. Tudor) for his sympathetic remarks h, connexion with the wool question. He suggests that a small Committee of members of this Parliament should be appointed to gather some facts with reference to wool, with a view to reporting to both Houses. The suggestion is a valuable one, because it is only by gaining the sympathy of all sections of the community, and by treating the matter as an absolutely non-party one, that we can hope to arrive at a just and permanent solution of the present difficulty. I am pleased that the last question touched upon by the Prime Minister (Mr. Hughes) yesterday afternoon before he left for Great Britain was the matter of the’ sale of our wool; and I am glad that the Government have afforded the House the opportunity cf discussing it .fully, because enough has been heard by all honorable members to enable them to realize that, at the present moment, the disposal of our wool is of paramount importance to Australia. The position is serious and, unfortunately, lii-gent. Wool is sold in the markets of the world .every day, and the price is either going up or going down. We cannot afford to postpone action in regard to lim matter, and it is well that full consideration should be given to the position before any decided step is taken.
– I do not think we can conclude our discussion of the matter today.
– It is not possible to do so. I shall be glad to remain here in my place to hear the views of every honorable member who desires to address himself to the subject. If, in the course of my remarks, I do not make myself quite clear, I will be only too delighted to answer any question submitted by any honorable member. As far ‘ back as any of us can remember, wool has been one of the most important of our staple products. Our wool has invariably had a good exportable value and the income received therefrom by large and small sheep farmers alike has been of vast importance, not only to them but to the whole community. To a very large extent, not only the prosperity but the actual employment of vast numbers of the working class of Australia is dependent upon our sheep farmers receiving a remunerative return for the wool they grow. “
I wish to impress honorable members with the seriousness of the position’ by giving a few figures. Australia’s annual output of wool may be said to be roughly 2,000,000 bales, or onefourth of the world’s production, which may be estimated at about 8,000,000 bales. We produce about 50 per cent, of the merino wool of the world. In past times, a certain quantity of wool has been carried over - that is to say, it has not been bought by the actual manufacturers - from year to year, but the proportion of held-over wool has never been very large. Owing, however, to circumstances which are well known to honorable members, there has been of late a colossal accumulation in the carry-over wool of Australia. The old clip owned by the British Australasian Wool Realization Association - commonly spoken of as “ Bawra “ wool - amounts to about 1,700,000 bales.
– Is the whole of that in London?
– No, but the greater part of it is. In addition to this total of 1,700,000 bales of Australian wool, there is a carry-over of 800,000 bales of New Zealand wool, so that the carry-over of the old clip of Australasian wool amounts to 2,500,000 bales. There is also a carryover of 200,000 bales of South African wool belonging to the British Government, making 2,700,000 bales in all.
– What money has been received by the growers in respect of the Australian carry-over?
– The producers have received the appraisement value of 15½d. per lb. for the whole of that wool on a greasy basis.
– So that the whole of the Bawra wool represents profit?
– Yes, one-half of the proceeds of the sale of that wool will go to the Imperial Government and one-half to the Australian wool-grower. It will be gathered from the figures I have given that, inclusive of the South African wool, there is a carry-over of 2,700,000 bales of the old clip.
– In the Pool.
– Yes; in some Pool or other. I come now to what I shall speak of as the new clip, or that in respect of the year beginning in July last.
– Would the honorable gentleman mind explaining the payment of the flat rate of 15½d. per lb. already received by the growers in respect of the Bawra wool 1
– The whole of the Australian wool was originally purchased by the Imperial Government at a flat rate of 15id. per lb. in the grease, and the money was ‘ paid in cash to every woolgrower within a fortnight of the appraisement. This cash payment was made here by the British Government before they had sold any of the wool.
– And there was a further condition that the British Government were to return to the growers 50 per cent, of the profits made on the resale of that wool?
– Yes. ,
– Was there any arrangement with regard to any loss that might occur?
– The Australian growers did not undertake- to share any loss that might be made. As a matter of fact, the British Government have sold enough wool to account for what they have paid the Australian -growers, and whatever is derived from the sale of the remaining 1,700,000 bales of carry-over wool will represent a profit, one-half of which is to be returned to the woolgrowers.
– But there is a glut in the market.
– That is so. In the past the greater .part of each new clip has been sold ‘between November and January or, at the latest, by the middle of February. For all practical purposes, the growers used to have their wool sold very soon after it has been sent to the seaports. At the present moment, however, although we are within two. months of the close of the financial year, not onehalf of the new clip has been sold.
– But in respect of the whole of the carry-over wool the Australian grower has already received payment of a flat rate of 15id. per lb.
– That is so; but certainly nothing like one-half of the new clip has been sold, and there is very little prospect of it being sold during the current financial year. It is estimated that, of the new clip, something like 1,000,000 bales of Australian wool, out of a total of probably 1,600,000 bales, still remains unsold, and. that 300,000 bales of the new clip of New Zealand wool also remains unsold. We thus have unsold a total of 1,300,000 bales of the new clip of Australasian wool, which, added to the carryover of the old clip, gives a stock of 4,000,000 bales still remaining unsold. Roughly speaking, the maximum clip of Australian and New Zealand wool, per annum, is 2,500,000 bales, so that nearly double the quantity of the usual annual output is still unsold. In addition to this, we are faced with the coming in of thisyear’s clip, in respect of which shearing operations will begin about August next. The result of having this accumulation banging over us as a sort of sword of Damocles, has been a constantly falling market, and the best efforts of woolgrowers, wool-brokers, financiers, and others have been devoted, for a considerable time, to an attempt to prevent this continually falling of the market by controlling, in some way, the great excess of supplies. The hold-over wool of the old clip has been arranged for by the creation of the British Australasian Wool Realization) Association. This corporation is quite prepared to handle that wool, and to impose limitations in regard to it so as to bring about a gradual realization in the interests of wool -growers.
It has. been suggested in this Chamber that the wisest course to pursue would be to keep this hold-over of 1,700,000 bales off the market. That, of course, is obvious, and I do not think that Australian wool-growers, although they have a half interest in that wool, desire that it shall, be sold immediately or pressed upon the market. We cannot, however, overlook the fact that they have only a half interest in it, the remaining half interest being held by the Imperial Government.
– But both the Imperial Government and the growers stand to lose nothing, so far as that wool is concerned.
– It might be said that both stood to lose nothing if that wool could be put on one side and there was an end to it. But while the Australian wool-grower is more concerned with the price that he will get for the present clip and the clip now growing than with any prospective profits from the realization of this old wool, we cannot expect the Imperial Government to take up the same attitude. In the first place, the Imperial Government paid. us, in cash, long ago, 15½d. per lb. for this old wool, although a great deal of it remains unsold. And they are also being subjected, not unnaturally, to pressure on the part of people in Britain who desire cheap wool and cheap clothing. These people are urging that, as the Imperial Government owns one-half of this hold-over wool, it should sell it instead of holding it off the market. We have to face the facts, and that is not am unreasonable attitude for these people in the Old Country to take up.
– Although the British Government has paid 15½d. for this wool, the public may demand that it shall be sold for 9d., or even 8d., per lb.
– Yes. The profit made by the resale of our wool was so great that it has left us with a half share in 1,700,000 bales costing us nothing; but that profit was very largely made by means of high prices charged to the British and allied manufacturers.
– Then, the British Government has squared itself. The carryover wool owes it nothing ?
– That is so, bub the half share of the wool belongs to them, and that being so, every arrangement made in regard to it must be a matter for negotiation with the Imperial Government. Negotiations have been carried on for some considerable time by some of the ablest men of the Empire, including Sir Arthur Goldfinch and those acting with him at the other end of the world, and Sir John Higgins and those acting with him at this end. These men have come to a perfectly fair arrangement. They are prepared, at the same time to meet the owners of the free wool in a reasonable way. But wecannot expect the Imperial Government to put its carry-over, wool entirely on one side, leaving the market solely to the owners of the new clip. They have, however, made what seems to those concerned a very fair arrangement, namely, that for every six bales of Australian and New Zealand wool sold’, they should be allowed to sell two, in other words, one bale out of three.
– Where does Bawra come in? Do they not get a “ cut?”
– That Association is the owner of the whole of this wool; it is a matter of transferring - of converting what might be called a syndicate ownership into a realization . company. Honorable members will see that the crux of the whole question, the centre around which everything revolves, is to persuade the owners of Bawra wool not to rush it on the market, and let the market go to - well, the end of everything. With that in view suggestions have been made which culminated in the deputation of which I was one, which waitedon the Prime Minister the day before yesterday, and in the statement we had from the Prime Minister yesterday. I wish to emphasise the importance of this particular aspect. The directors of Bawra object very strongly to their wool , being subject to these reasonable limits, when at the same time free wool of the new clip is sold in Australia and! London below those limits. All those of experience in the business will admit the reasonableness of that objection. The directors of Bawra say that if they cannot sell their wool - if buyers go away, and subsequently, perhaps in the same room, a fresh set of catalogues is distributed, and a fresh lot of wool placed before the buyers and sold at 10 to 20 per cent. lower price than the Bawra limit, they, the directors of Bawra, regard the position as unreasonable, and they claim the freedom to sell their wool on the same terms as do the owners of the new clip.
– Have both wools the same essential qualities?
– Yes; no two clips are alike, of course, but broadly speaking they are the same; there is no special depreciation in the wool held over, and any difference in quality does not affect the issue. By means of able negotiation the directors of Bawra have been able to persuade the woolbrokers of Australia in regard to the wool of the new clip sold by them, to fix the same limits as Bawra will place in London. There remains, however, a quantity of wool in London known as free wool of the new clip, which, though not very large, is quite enough to depress the market. The directors of Bawra have not been able to persuade the importers of wool into London, acting almost entirely for Australian growers, to place the same limits on this new free wool, as on the Bawra wool in London and the new clip here.
– Has the honorable member any idea how much of this outside free wool there is on the market?
– As a matter of fact, there is very little. The free wool, which was shipped to London, is mainly sold on arrival. The exact figures regarding the wool now in London might be difficult to get, without cabling.
– There are 488,000 bales in London to-day held by those who are opposed to the scheme.
– No; allow me to explain that the figure of 488,000 bales was arrived at by taking the average quantities imported by those firms during the pre-war period; it is not meant that there is that quantity of this wool in London to-day. As a matter of fact, there might be only 488,000 bales of new clip in London or only 100,000 bales. The 488,000 figure referred to by the honorable member for Darling (Mr. Blakeley) was adopted as an average for the purpose of arriving at the relative power and responsibility of each importer in the matter. It has been ascertained that opposition to the imposition of limits mainly came from the head offices of two of the Australasian banks. I have not one word of reproach to say against these or any other banks; they a re acting as agents, or consider they are, for the growers, and they claim they have no authority to bind the owners of the wool. That being the situation, a proposal has been made and indorsed by practically the whole of the growers of Australia - I do not think there could be found 3 per cent. to object - and also by fifty-three out of fifty-four of the woolbrokers of Australia. That proposal is to prevent, in the future, the sale of free wool in London regardless of price, by imposing some slight restriction on the export of wool. I wish to be very clearly understood onthis point. First of all, it is not proposed that there shall be any restriction whatever on a man exporting his wool for sale in any market of the world he chooses. For all practical purposes, nearly the whole of the wool exported for sale is exported to London. This proposal, in my opinion, does not involve the passing of any new Act of Parliament, but is merely a matter of Customs regulation. The idea is that, before the Customs authorities will allow any wool to be exported, they must receive a satisfactory guarantee that the wool, wherever and whenever it is sold, will be sold subject to the limits placed on other wools by Bawra.
– Under what Act of Parliament can that be done?
– Under the Customs Act.
– I have my doubts as to that.
– Do you think it right for this Parliament to give power to an outside body to say what shall be done under Customs regulations?
– It is not suggested that the power should be given to any outside body.
– The proper thing is to do it through the Customs authorities; but legislation will certainly be required.
– I bow to the opinion of the honorable member in a matter of that kind; it is for the Government to decide exactly what, if any, legislation is required. But I remind the honorable member that similar action has been taken before without legislation.
– Under the War Precautions Act.
– As I understand, the regulations under which it was done were those of the Customs Act, and not of the War Precautions Act. I am sorry that the Leader of the Opposition (Mr. Tudor) is not here, for he has often and ably presided at the Customs House, and would doubtless have been able to give us the facts.
– I know exactly what took place ; it was practically between the
Central Wool Committee and the Customs Department, and the Customs Department simply refused to give its consent.
– The exportation of sheepskins was prevented under the Customs regulations._
– What is suggested now is not a prevention of exportation, but simply the imposition of a condition.
– :That is where the difficulty comes in.
– I do not think that this is exactly the time to discuss whether such action can or cannot be taken, though I believe that it can. If a man will not give such a guarantee, and is not allowed to export, the effect will be what is desired.
– What form of guarantee is proposed?
– That has not been decided.
– It is a very essential point. ._
– It is? and before the House is asked to definitely approve of the scheme it should be in possession of the wording of the proposed guarantee.
– Assuming that we have the power to impose such a condition, does the honorable member not think that it would he quite open to a man to give a guarantee, and, when he got overseas, ignore it, and sell his wool for what ho liked?
– That would entirely depend on the form of the- guarantee, and I think we can safely rely on the directors of Bawra taking such steps as will secure that no man may escape responsibility.
– If, for instance, I exported wool to Italy, there would be no power here to prevent my selling it there at any price I liked.
– No, but I think such a contingency could very easily be provided for. As I say, I have sufficient confidence in the directors of Bawra to believe that they will make it absolutely certain that no man could sell in Italy except on the terms of the guarantee.
– I suppose the guarantee will provide penalties for any breach ?
– I think so, unquestionably, but that is simply a matter of detail.
– No penalties will, prevent depression of the market if a man is unscrupulous enough to sell at a lower price than that provided by the guarantee.
– I agree with the honorable member. No penalty will prevent’ any depression of the market ; but it -is to prevent depression - to prevent a hopeless collapse of the market - that the guarantee is suggested. I am quite satisfied that arrangements can be made by the directors, in consultation with the Customs authorities, to insure that the control of the price is effective in any part of the world. That I have no hesitation, in saying, as one who has been connected with the shipping of wool for the last forty-five years.
– Suppose, for in- ‘ stance, the reserve price is fixed at 9d., and the Australian wool cannot be sold at that figure; suppose, further, that shipments from the Cape and the Argentine come along, and the owners are prepared . to take a shade under that price. That will secure the market for these latter; and what’ becomes of the Australian wool ?
– I am glad that question is asked, because it reminds me of a fact I had intended to mention. We cannot control the wool-growers or the woolbrokers of the whole world, and we would not seek to do so. We have to bear in mind, however, that we in Australia grow one-fourth of the wool of the world. At the present time there is in Melbourne a representative of the NewZealand Government and the New Zealand wool-growers, and he is now, I believe, in this chamber. That gentleman isvery anxious indeed to know the result of the debate here, because the New Zealand Government, and the whole of the New Zealand growers, are anxious to fall inline with Australia. It is” also more than probable that the wool-growers of South Africa will be anxious to join.
– It would be invaluable to us if they would ; we do not desireour market to be captured.
– Whenever an effort is made to prevent the utter and absolue collapse of the market, there will beoutsiders who will try to take advantage of it. We must provide against that. I now ask those who have raised these objections what is the alternative? If we- cannot devise satisfactory means for controlling the export of our wool, and preventing the sale of it in London at whatever price it will fetch, Bawra cannot be stopped from saying, “We intend to realize on our wool, too “ ; and then, in addition to the new wool which has to be put on the market, there will be offered for sale theaccumulation of 2,700,000 bales now controlled by Bawra.
– Would there be customers for all that wool?
– No legitimate purchasers.
– Speculators might buy it.
– Yes. Some persons might draw money out of other investments to buy our wool at a quarter of its cost.
– Or even less.
– Yes. If that happened, it would be the greatest calamity short of the war that ever occurred to Australia, and would kill the pastoral industry of this country. I have no love for Government restrictions, and no desire to use the Customs Act for interfering with the law of supply and demand, nor do I like preventing men from selling their wool at whatever prices they choose to accept for it ; but I see no alternative. We are faced with an appalling disaster. The position of Australia is desperate, and desperate diseases require desperate remedies. You may say that this is a desperate remedy, but it is a remedy for a disease that is infinitely more desperate. We shall have to face the position as constructive statesmen must face such issues when these are placed before them.
– Have you any idea of the value of the carry-over wool?
– It is impossible to say what its value is, because that depends on the market. It would be idle to give an estimate of its value.
– What is the value of this year’s clip?
– That cannot be estimated, because 1,000,000 bales are yet unsold.
– The honorable member has told us that the wool-growers of Australia have received from the British Government1s. 3½d. per lb. for the wool sold by it, and, in addition, half the profit. There still remains a quantity to be sold. I take it that the producers will get their share of the profit on the sale of that wool.
– Yes, one-half of the profit.
– In addition to the 1s. 3½d. they have already received for it?
– Would it be possible for Australia to take over the whole of the accumulated wool and keep it off the market for five or six years?
– How would the money be found for doing that?
– I think that £20,000,000 would cover the cost, and we ought to be able to float a loan for that amount to save the pastoral industry.
– The proposal deserves full and serious consideration, though, for myself, I think it will be found, when all the details are gone into, that it is not practicable.
– It is a curious proposal to come from the Opposition.
– I welcome ideas from whatever quarter they may come.
– Had the war continued for another two years, it would have cost us more than £20,000,000.
– The honorable member was going to speak of the Prime Minister’s suggestion of the two months’ restriction.
– I intended to say that the Prime Minister yesterday made a very valuable and statesmanlike speech; but it was his own speech, and contained some of his own ideas, though in some respects the proposals he outlined were modifications of those which were submitted to him the day before. I would, however, impress on the minds of the Ministers that the suggestion that any restriction should be for two months only, though well intentioned, is quite impracticable.
– I think that limitation a most valuable feature.
– It was suggested to enable the Prime Minister to discuss this matter with , the Imperial Government.
– Yes, but I ask the House to consider what the effect of its adoption would be upon the wool market, which is the thing with which we are wholly concerned. Our object is to save the wool market from collapsing. The Prime Minister’s remarks seemed to have created different impressions in different minds,yet I think it is clear that what he proposed was not to prohibit the exportation of wool for two months, but to restrict it.
– Prohibition is not contemplated: It was the fixing of a reserve price that was suggested. That should be made quite clear to the public.
– Yes. But there was a general impression among those who heard the Prime Minister yesterday that the. proposal was an absolute prohibition of exportation. According to onereport, this is what he said -
We have an opportunity of meeting the situation. I ask members to limit the operation of this prohibition of export until I have an opportunity of discussing the matter with the British Government.
Another report gives His words differently.
– What he meant there, and all he meant, was that this fixation of reserve price was to be for two months. The idea was that he would discuss this matter immediately on his arrival in London with the Imperial Government.
– Some persons are under the impression that he said one thing, and some that he said another. Another report makes him say-
I ask members now to restrict the exportation of wool until I have been able to discuss the matter with the Imperial Government.
My recollection is that he suggested only the restriction of export for two months, not prohibition.
– What he really meant was the regulation of reserve prices.
– I wish to direct attention to what would be the effect on the wool market of limiting any restrictions for a period of two months. Our desire is to prevent the wool market from collapsing, by giving confidence to buyers and manufacturers, so that they may not feel that in buying now they may be paying very much more than they will have to pay two or three months hence.
To my mind, the only effective method of restricting export is to ask every man. who wishes to ship his wool for sale in London to givea guarantee that he will not allow that particular parcel to be sold under the limit fixed from time to time by Bawra. If it were said to me, “ Mr. Jowett, you must guarantee not to allow this parcel of wool that you are shipping to be sold below Bawra prices for two months,” the restriction would bo useless, because it takes six weeks to get wool to London, and two months would elapse between its shipment from Australia and its sale there, which would make the restriction inoperative.
-Could not the wool be sold “ to arrive “ ?
-For all practical purposes it could not.
– There would be uncertainty among intending purchasers as to what would happen after two months.
– Yes. The effect would be to postpone all buying of wool for two months. Every intending buyer would say, “ I shall not buy now, because two months hence there will be a free market, and I shall buy then.”
– May I call attention to this sentence in the Prime Minister’s speech -
The prohibition I refer to -
He calls it a prohibition; wrongly, I think -
As that wool may be sold by any person here to any one’ in any part of the world, but there must be a guarantee that it will not be sold below the gross Australian Bawra reserve.
-I think that the Prime Minister’s statement was perfectly clear, but, unfortunately, there were persons who misunderstood it. He did not ask for the prohibition of export, but for the restriction of it. He wished to make it clear that no wool exported for sale in outside markets should be sold under the prices fixed by Bawra. Unfortunately, he suggested that the restriction should be for two months only.
– But even if it were for six months, the Government must have the right to lift it before the end of that period should circumstances make that desirable, No Government would bind itself not to interfere for a period of six months, no matter what might happen.
– What the Government could do would be to disallow the export of wool except subject to the guarantee in regard to each parcel that it would not be sold in any outside market for less than the price fixed by Bawra.
-Suppose it were clear in two or three months that there was no need for anything of the sort ?
– I do not suggest that this restriction should be made permanent. If at any moment the Government decided that the arrangement would not work, then the restriction could be removed, but, in any case, the guarantee should not expire, so far as a particular parcel of wool is concerned, at the end of the two months. The impression left on the minds of a good many people is that, after the expiration of two months, the man who had shipped his wool in the meantime would be free to sell it as he liked. That is not the suggestion of Bawra; it is that the owners of the particular parcel of wool should guarantee that at no time will it be sold under the limit fixed by Bawra.
– Has Bawra decided upon a policy towards the secondary woollen industry ?
– I am not aware that the position of fellmongered woolhas ever been discussed by Bawra. But, in my opinion, the restriction on export should not apply to bonâ fide fellmongered wool. I have received from a very old friend, Mr. Arthur Glover, who is a large fellmonger in Melbourne, the following telegram, which I desire to place on record -
Understand legislation proposed to impose restrictions on sale of feilmongered wool. Fellmongers mostly turn over, their capital sis times or more per year. Any restriction on selling which prevents prompt realization of fellmongered wools will prevent carrying on of fellmongering industry which is already on verge of ruin and needs all possible consideration at present time to enable it to survive. Skin wool forms only about 5 per cent. of Australia’s wool production. This percentage cannot affect results Bawra scheme. Suggest sheep-skins and fellmongered wools be exempt, or, as alternative, that low reserves be fixed for skin wools to enable quick sale. Respectfully suggest that trade should be consulted and opinions of experts be heard before the whole business is thrown into melting pot, and perhaps ruined. Revival of industry and general employment with improved market for sheep-skins, to advantage of growers, most favorable, provided the industry left unmolested, and exempt from embarrassing restriction.
I think the request made by Mr. Glover, no doubt in behalf of a great many other fellmongers, is reasonable.From a woolgrower’s point of view, it would be quite possible to make arrangements to exempt fellmongered wool from the restriction on export. That would apply also to wool tops. The position of the fellmongering industry at present is most serious owing to the excessive ocean freights and the low prices which wools are bringing. There is an enormous amount of unemployment in the industry, and everything possible should be done to place it upon a sound financial basis as soon as possible. For that reason, whatever restrictions are placed on the exportation of growers’ wools should not apply to fellmongered wool.
-Can the honorable member say whether any communication has been sent by Bawra to South Africa and the Argentine, pointing out that if those countries do not co-operate and the bottom falls out of the market they will suffer with Australia?
– I cannot say whether that has been done. If suchaction has been taken it has probably been by the London directorate of Bawra or by important financial authorities in London. At any rate, that point will not be overlooked, and I am grateful to the honorable member for his suggestion. In conclusion, I desire to’ impress upon the House the enormous importance of this question being handled in a statesmanlike and constructive fashion. Whilst I court the fullest possible inquiry and the most exhaustive deliberations, it is necessary, if we are to save the wool industry and the financial interests of Australia from a grave disaster, to consider this matter in. a sympathetic spirit and act immediately:
.- It is gratifying to note the conversion of certain honorable members opposite to Government interference in industry. The present situation affords another example of the utter incapacity of private enterprise to manage a business. The banks cannot agree amongst themselves, neither can the wool brokers and pastoral- ists. I do not intend to indulge in destructive criticism, but I cannot help remarking that unless the Government take control of the handling of our products and undertake the efficient grading and supervision of them, no other authority is competent to do it.
– That makes me throw my chest out.
– Of course, I would prefer that these matters should be dealt with by a Government from this side of the House; but, failing that, still, let us have Government supervision. “Undoubtedly, Australia is faced with a crisis. It is nothing new; it hae been coming for a long time, and those who are connected with the woollen industry, either inside or outside of it - I am outside - have known perfectly well that some such collapse was inevi table.
– Yet the shearers are claiming another ls. per hundred sheep.
– In behalf of the men who are outside the industry, I am making that claim, and I am prepared to give good reasons to justify it. Those men are more concerned than are the pastoralist, because, if there is to be a, collapse the working class will suffer first. A gentleman who delivered an interesting lecture this morning said that the big man has accumulated sufficient fat to keep him going for some time ; but the working man has not. A collapse of the wool industry will mean the immediate depreciation of land values. The position which that industry occupies in Australia is shown by the fact that in the year 1918-19 the value of the wool produced was £42,764,000, whereas the wheat production was worth only £19,344,000, and minerals £26,000,000, including £6,700,000. for coke and coal. Of course, many of the industries in which coke and coal ara largely used are supported bv the pastoral industry. At any rate, the value of the pastoral industry is nearly as great as that of mining and wheat-farming combined, With a depreciation in land values will come a fall in the values of town property, railway revenue will decrease, country banks and their head offices ‘in the cities will feel the pinch. There will be a shortness of money followed by a calling in of mortgages, and inevitably there must ensue financial chaos and unemployment. We of the working class who are on the outside of the pastoral industry will be the first to suffer if it collapses. TheLeader of the Opposition (Mr. Tudor) suggested this morning that before Parliament daces the seal of its approval upon any scheme it should satisfy itself that the scheme is sound and equitable, and will not impose hardships upon any section of the community. We have before us the Bawra scheme, and also the scheme which the Prime Minister (Mr. Hughes) briefly indicated yesterday between glimpses at his watch to assure ‘himself that he was not missing his train and boat. Between the two schemes are a number of large pastoral interests which will have nothing to do with either.
– That is not so.
– There are financial interests in Victoria that refuse to have anything to do with the Bawra scheme. There are pastoralists who adopt the same attitude.
– The position really is that some banks in London have received consignments of wool from pastoralists in Australia, and they state that they have no authority from their clients to place that wool in the scheme.
– The Bawra scheme has been criticized by Mr. A. G. Rymill, manager of the Canowie Pastoral Company, a large financial and pastoral body. Apparently, the views he has expressed have the support of his directors, and I wonder how many financial and pastoral interests do not subscribe to the scheme that has been submitted by Bawra. Mr. Rymill says that he is not sure that it would not be best to dump the whole of the accumulated wool into the ocean or to burn it. At any rate, he suggests the advisability of throwing the 2,700, Q00 bales upon the market and allowing that wool and the new clip to take their chances. He suggests that the best way out of the difficulty is to let the whole thing go smash until a demand is created because of the cheapness of the wool, which will buoy up the market once more.
– I do not know how Mr. Rymill proposes to pay the wages which the honorable member’s friends will require.
– I am merely pointing out this gentleman’s view-point.* There- are so many contradictory and conflicting statements as to the position of wool that the Government cannot, on the representations of any one section of the community, adopt resolutions which may prove to be on wrong lines. Unless I am quite satisfied that the scheme suggested by the representatives of the British- Australian Wool Realization Association is the best, I cannot support the Government iii following upon the course laid down by that association. It has been suggested that a Committee of honorable members should institute an inquiry. The House should take no action until that Committee has reported. The members of the Australian Workers Union are exceptionally interested in this matter. Their award having expired in December last, they have already submitted claims to the pastoralists, which will be heard in the Arbitration Court very shortly ; but if the whole wool market goes smash there will be no sheep for the members of the Australian Workers Union to shear. If wool falls to a price of 2d. per lb., it will not pay to shear the sheep; the pastoralist will simply turn them into his paddocks. The banks of Australia have recently got cold feet, and have issued notices that overdrafts must be reduced. It is but another example of the unfitness of private enterprise to manage any national matter, and finance is essentially a national matter. We shall always be faced by similar crises until the policy advocated by the Labour party, that this Parliament should control the finances of the country, is adopted by the people generally. Apparently our financial institutions are not prepared to further subsidize the small pastoralists and graziers. In no unmistakable terms they are saying, “ We want our money.” In the western portion of New South Wales the small graziers have just passed through five years, and in some cases six years, of drought, suffering losses not covered by two years of good prices for their wool. Therefore, they are still in the hands of the banks.
– Are not some of them being forced to sell their stock, in order to pay off their overdrafts ?
– Some of them will be sold up. I have advocated the extension of the moratorium, in order to protect the interests of the small men. I. know it is impossible for the Commonwealth Government to do this, but, acting in conjunction with the State Government, they could establish a system which would protect these men from the banking and other financial institutions. The Commonwealth Bank, which has been the mainstay of this continent for the past six years, and which will inevitably continue to be a great stay to the country, .must also play its part in an endeavour to prevent a financial collapse. Australia is not bankrupt because its indebtedness has been increased by £300,000,000. Its assets are surely quite sufficient to tide it over a temporary period of depression. Some people estimate that this period will cover at least two years, but others who are in a position to express a reliable opinion hold that it -will not last so long. However, I am satisfied that, if we use the whole of the resources at our disposal, we can get over this depression quite comfortably without any collapse, chaos, or unemployment, with its resultant starvation.
.- I would have been pleased if this discussion had been held over until Wednesday next, when fuller information might have been available in connexion with the best means of handling our wool. It is a most serious matter, and honorable members must approach it with the utmost caTe, and with the fullest assurance that any step they take will neither damage an important industry nor bring . future disaster to the Commonwealth. However, for the moment, I shall not discuss this question, but will address myself to the remarks of the Prime Minister (Mr. Hughes) as to the financial situation. The right honorable gentleman endeavoured to throw upon this Chamber the responsibility for expenditure incurred during recent years. It was absurd, and, in a sense, improper, for him to attempt to do so. The responsibility rests solely upon the Ministry.
– And upon those who keep them in power.
– No ; because those who are behind the scenes are fully alive to the position and to our commitments. I have urged the Treasurer time after time to take the people into his confidence and let them know exactly what our commitments are. Only the other day I asked him to bring in excess Estimates which would afford, not only the House, but also the people outside, an opportunity of fully realizing our financial responsibilities. In October last, I pointed out that, in addition to the total indebtedness of £800,000,000, States and Commonwealth, we were committed to an expenditure of £150,000,000 for repatriation generally, the building of War Service Homes, the settling of soldiers on the land, the payment of our huge debt to the Imperial Government, and the meeting of Treasury-bills falling due. Of course the figures are not the same to-day, because by a most extraordinary piece of finance, for which the Government take great credit, but which I consider to be a most reprehensible transaction, by an arrangement made by Senator Millen in Great Britain, our debt to the Imperial Government has been funded. I could quite understand the funding of the loan moneys we borrowed from that Government, but no credit is due to our Ministers for having funded a debt amounting to nearly £40,000,000 which was owing to the British Government for money advanced by them for the upkeep of our soldiers. The Imperial Chancellor had made request after request to us for the payment of this debt. The Imperial Government was obliged to find enormous sums of money in order to finance the war and assist other nations, and particularly to repay money borrowed from the United States of America. But when we were asked to pay what we owed, the Commonwealth’ Government ‘ pleaded bankruptcy. They admitted that they owed the money, but pleaded their inability to repay it, and compromised by giving a bill for the amount repayable in thirty years and bearing interest.
– What would the honorable member have done with that floating debt of £40,000,000 in London?
– I am merely pointing out the position into which we have drifted.
– There was no drift in regard to that fund.
– We induced the Imperial Government to spend money on our behalf, and promised to repay it.
– So did every other portion of the Empire. In the circumstances of the war it could not be avoided.
– The money was spent in fighting to protect the Empire.
– The money was spent in order to protect ourselves. If I owed the honorable member £100, he, naturally anticipating repayment, would. make arrangements to meet his own obligations. What would be his /position if, when he asked me to pay off my debt, I said, “I will give you a bill for thirty years.”
– I would take your bill if you had done as much for me as Australia did for the Empire. Sitting suspended from 1 to 2.15 p.m.
.- I propose to deal, not only with the wool situation, but with the general financial outlook .as disclosed yesterday in the speech made by the Prime Minister (Mr. Hughes). I have no desire to make this a party matter, because I recognise that there are phases of the wool situation which must not only excite the interest, but demand the careful attention of, honorable members generally. The whole problem has “to be solved with due regard to the best interests of the people of Australia. In approaching its consideration, we have to ask ourselves whether the advice given by the Government, and by those who claim to be the leading statesmen of this country, has been wise or not. I. agree with the honorable member for Grampians (Mr. Jowett) that we must tackle the problem from the point of view of constructive statesmanship; but in doing so we have to consider something more than the wool situation, which, after all, is but the effect of deeply underlying causes. We must consider the real causes of the trouble, and take steps, if - possible, to eliminate them. We have not only to tide Australia over her present difficulties, but to endeavour, if possible, to prevent their recurrence. The present situation is the result of a policy which was proclaimed throughout the country by the Government, who urged the people again and again to produce more and yet more. They told us that our salvation was to be found only in increased production, and that we had to produce more and -more wealth in order to tide the country over its difficulties. The people harkened to that advice, and the production of our primary industries, as well as of our secondary industries, was very materially increased. As the result of that increased production we are brought to a dead end. We are told now that we are confronted with a serious situation, not because we have not the economic goods which make the life of the human possible and tolerable, but because we have a glut of them. That, then, is the result of following the policy of the so-called constructive statesmen of Australia.
As to the attitude of the Imperial Government with regard to the carry-over wool, the honorable member for Grampians has shown very clearly that that wool owes nothing either to the Australian wool-growers or to the British Government. Many wool-growers have told me that they are perfectly satisfied with the flat rate of ls. 3£d. per lb., which they have already received in cash, and we know that” the British Government have more than cleared their expenses out of the sales that have already been made. The primary products necessary to enable Britain to carry on her manufactures are largely drawn from Australia. She depends upon Australia more than upon any other country’ for her supplies of wool, and also purchases by far the greater part of our production of wheat. In these circumstances the’ people of Britain are undoubtedly interested in the maintenance of Australian industries, and surely it would not be asking too much of Britain to call upon the Imperial Government to refrain for a time from putting this carryover wool on the market. The British Government do not ordinarily carry on the business of a wool broker. It was due to the exigencies of the war that they entered upon such a business, and it would not be too much to ask them to hold this carry-over wool for a time.
– Does the honorable member think the Labour party in the British House of Commons would agree to that?
– I do not know whether it would or not, but if the British Government desired to take .such action, the Labour party in the House of Commons could not prevent them from doing bo.
I propose now to discuss a’ very important remark made yesterday by the Prime Minister, who stated that he had been informed by Sir John Higgins that the collapse of the wool market was really due to action taken bv some of the Australian banks which have their head offices in London. That statement goes only to confirm the view I have before advanced in this House that at a time of crisis, when the very life of a nation is at stake, these banking institutions fail to function. They are only fair Weather institutions. While the weather is calm, and there is no sign of storm, they function regularly; they rake in profits, build up big reserves, and pay good dividends. But when a crisis occurs they are the very first to call far Government assistance and backing in order that their doors may be kept open.
– They have given a good deal of support to the Government of late years.
– If our notes had not been legal tender issued by the Commonwealth, not one of these -financial institutions would have remained open for forty-eight hours after the declaration of war. Financial institutions in Great Britain closed their doors four days after the declaration of war. They failed to function, and but for the action of the British Government, in wet-nursing them, there’ would have been such a financial crisis as would have immediately put Britain out of the war. That has been admitted by British statesmen. Are, we to have a legal tender, with the imprimatur of the Commonwealth upon it, and backed up by the resources of this great nation, in order merely to hand-feed these institutions ?
-r- What institutions ?
– The Associated Banks of this country. If “we are going to do that, and keep on doing- it, then we shall deserve to .meet with a crisis of this kind every few years in our history.
– What are we going to do’ with our wool if the cost of its production is made too high for the world’s markets ?
– If through t a rational and proper means of exchange the energies and activities of our people were unloosed and allowed to be applied to the primary and secondary industries of Australia, there would never be any danger of that kind.
We hear much talk to-day on the part of outside organizations, describing themselves as economy associations. The Prime Minister made reference to them yesterday. The two morning newspapers of Melbourne - the Age and the Argus - are always writing -of the economy campaign, and the daily newspapers of New South Wales are almost “as bad. Their policy is very much like that ‘of the man who prefers to walk rather than pay for a few bram tickets, and wastes three times their value in boot leather. ‘These newspapers and organizations which deal with paltry matters, and talk of a few thousand pounds, which they think could be saved in the running of this Department or that, are simply straining at the gnat and swallowing the camel. They represent the commercial interests of Australia, and when they are shown how it is possible immediately to save millions of pounds, they will not give a moment’s consideration to the proposal, because they recognise that it affects their own interests. They speak of the wealth of this country as if it were to be measured by the accumulated wealth of its industries, and the big bank balances of a few individuals. They measure the wealth of a nation as they measure their own profits and bank balances, whereas the wealth of a nation has never depended on anything of the kind. It depends mainly on the brains, brawn, and sinew, the health, and the intelligence of a free people. The wealth of a nation can be measured only in those terms, and not in terms of money. I propose to show how vast savings might be effected in this country, and how any further taxation to finance the nation until we have a return to normal times may be avoided. At the present time, 5,000,000 people are taxed to provide for the annual interest bill of £25,000,000 on our internal debt. That interest payment, which has to be met over and above all the other expenditures of the State and Federal Governments, could be wiped off to-morrow, without the suggestion of repudiation, and without requiring the nation to take a penny piece from any individual. The loans, amounting to £260,000,000, in respect of which this interest bill of £25’,000,000 ner annum is payable, were floated within the Commonwealth, and the Government issued bonds in respect of them. I do not wish for a moment to belittle in any way the security behind those bonds - it is certainly the finest in the world - but I invite honorable members to consider for a moment of what that security consists. What tangible security has the holder of a war bond of. say, £1,000 ? None! He, undoubtedly, has bv way of security the resources of the Commonwealth - the productive capacity of Australia in future years, but what tangible’ asset has he? He has nothing other than his faith in the established’ Government of the country, and the ability of the Government to tax the people, and the wealth of the country, in order to be able to pay the interest as it accrues, and eventually to pay off the principal. Supposing the honorable member for Eden-Monaro holds a £1,000,000 war bond - though I do not think he is quite so wealthy - due in 1925, and he insists, as in a mortgage, on cash instead of a renewal, if the Government say that they cannot pay- -
– I suppose you know a war bond is not an ordinary mortgage?
– I know that. What I am trying to prove is that the honorable member would have no tangible assets as security. Is he, under the circumstances, going to take a strip of the east-west railway, or some of the postoffices, or a portion of the Federal Territory? -I know there are honorable members who will laugh at what I am about to say; but I challenge any one either here or outside to question its economic and financial soundness. I know that honorable members opposite do not wish to close up the private or Associated Banks, but if the Labour party get into power, that is what we shall do.. If we wish to extend the Commonwealth Bank’s influence we must first amend the constitution of the Bank, and insert a provision similar to one in the constitution of the Bank of England. It is a provision made by bankers for the security of bankers, and it is to the effect that no financial institution may draw on the securities of the bank except by deposit receipts. If other banking institutions of Britain get cheques, drafts, or bills of exchange against the Bank of England, all they can do is to place them in that bank, and take a credit deposit for the amount they represent. Hence the bank, in ordinary times, is secure, and is able to stabilize the whole of the banking institutions of Britain, for the simple reason that its resources can never be dr.awn on. If a similar provision were made in the case of the Commonwealth Bank, the Government could take back at once the war bonds, and place them to the credit of the owners in the Commonwealth Bank, leaving the bonds in the bank vaults. I claim that the same . securities as uphold the Commonwealth Bank can uphold the war bonds; and the immediate effect would he to release £250,000,000, -which is riot now available for the development of our secondary and primary productions, and, so far as this country is .concerned, is economically dead.
– :How does that get rid of the interest of £25,000,000 .a year?
– The interest _ will not be paid, or, rather, it will be paid in another way. Honorable members opposite, in their reception of these views, remind me, as I have said once before here, of Oliver Goldsmith’s phrase about vacant laughs and empty heads. However, as to the interest, if the bond-holders are prepared to put their money into the Commonwealth Bank for a fixed period, they will be paid the Bank’s interest; if they are. not prepared to do that, they will take out their credits and throw them into productive enterprises. A sum of £250,000,000 released, in this way would forward our progress and prosperity, by fifty, years. I shall support the scheme of the honorable member for Grampians for the reason that, in my opinion, there is no possibility of the Government going any further. That scheme, however, is only playing with the question - dealing with effects instead of causes - and will lead us nowhere. It would temporarily get over the present difficulty, but at the expense of a lot of* wasted energy.
– One has to jump one hurdle at a time. -. -
– That is all right, but the honorable member was not here when I was making some remarks . which greatly amused the honorable member for Eden-Monaro, and, therefore, hie cannot connect my argument. I know that such arguments as mine do not appeal to the commercial or capitalistic interests of the country. That is because the Associated Banks, with their head office in London, as the Prime Minister practically admitted in other words, are the whole corner-stone on which the present system is built. Hence what I suggest would be the last thing which the Government or their supporters would do. I know, at any rate, that the members of the Country party, who severely criticise the Government, but always support it, would hot approve of such a policy.
I do not care what the Prime Minister or his Government may say with regard to increasing the military and naval expenditure. Any increased expenditure will depend upon the way in which the finances’ of this country are managed, because, without the necessary resources,’ such expenditure cannot be met. The Prime Minister did not say so in so many words, but, by the whole tenor of his speech, conveyed the impression that we are on the verge of a financial collapse. But, according to the right honorable gentleman, no matter what may become of every other human institution, we must still pay our tribute to Mars, and, if necessary, increase it in order to keep the spirit of militarism alive. Under present circumstances I cannot support any increase of the naval and military expenditure. It is useless for’ the Prime Minister and his supporters to talk as they do - to open their mouths and talk so big. If our financial affairs are not managed in a rational and proper way, and a thorough re-adjustment made quickly, we shall not be able to meet increased naval and military expenditure, or any other. The honorable member for Grampians, when the honorable . member ‘ for Darling (Mr. Blakeley) was speaking, interjected something about wool in payment for shearing. I do not know whether the Government advocates that wool shall be made a medium of exchange, but whatever they do mean, the present problem must be handled and solved. Men who depend on their work for their livelihood must not. have their employment curtailed; thesmall wool-grower and all in the industry’ must he protected. Some reference hasbeen made to the export of wool to Germany, and it was intimated that we would; get no money for the wool, as it is certain we shall not. The great trouble is thai of the exchanges. I saw the other day that, owing to the exchanges,, it is possible to buy in Germany for £1 goods that are worth nearly £27 in Britain. If that is so, our wool and other products going to Germany, France, or elsewhere, are not reaching the people of those countries. The conditions are not of any good to tho people or the producers of commodities, but simply bolster up the agents and middlemen of the different nations. In the case I have just mentioned, there is a profit of 2,700 per cent., and that is the reason, possibly, that so many are now clamouring for. trade with Germany.
– Why should we not trade with Germany?
– I am not opposed to trading with Germany. There are, however, a number of honorable members opposite who, up to very recently, were opposed to such trading, declaring that they would not deal with the Hun under any circumstances. Now, however, that such trade promiseslarge profits, all their patriotic stuff of the past goes by the board. I agree with the honorable member for Eden-Monaro that we ought to trade with Germany; indeed, it is necessary to do so.
-We ought to sell them stuff, but not to buy from them.
– If we do that, what shall we get for our commodities ?
– They want our commodities, but we do not want theirs.
– Then, what are we to get in return for ours? Gold? What the honorable member suggests cannot be done. International trade is merely barter, and nothing else - the exchange by one country of commodities which it produces for the commodities of another country which it does not produce. The international trade of America and Great Britain runs into thousands of millions of pounds in the year, but not £1,000,000 in gold or other coin is exchanged between the two countries. The debts of each country are set against each other, and balanced by making up the difference in money. If we give Germany the goods that are necessary to feed, clothe, and otherwise supply her people, and take only gold in exchange, we shall get something of not much value to us. Gold in itself is merely a toy, and intrinsically no more useful than a bag of marbles.
– I propose to address my remarks wholly to the difficult and complicated woolquestion with which the Prime Minister (Mr. Hughes) dealt so elaborately and ably yesterday afternoon. Naturally one approaches the subject with diffidence, because the intricacies of the wool market are so great that we must depend largely on the advice of experts in deciding upon any course of action; but Parliament has very properly been asked to assist, so far as it can, in solving the difficulty that has arisen. The honorable member for Darling (Mr. Blakeley) has stated that the present desire of those associated with the wool industry to obtain the aid of the Government in controlling exportation confirms him in the rightness of the Socialistic aim of his party to secure complete Government control of the production of Australia. My reply is that a close investigation of the position would probably prove that the present chaos results from Go- vermnent control in the past. What we are aiming at now is to secure the stability of the wool market. We have received advice from men who are capable ofgiving it, and are keenly and deeply interested - advice which it would be a grave responsibilitytodisregard ; but we are justified in expressing our own viewson the proposals that have been put before us. It is proposed that the exportation of wool shall be restrained, and permitted only , on approved guarantee that the wool shall be sold on the London market at a fixedor reserved price. I put aside for the moment the consideration of the question whether we have the power to legislate for that, though I have no doubt that there is a way of getting it done. Now, to rigidly fix in Australia the price in London of wool that is about to be exported from this country is a course full of danger. We are jealous of the market that we have secured for our wool overseas, and particularly in London. But, as I pointed out to the honorable member for Grampians (Mr. Jowett), who this morning favoured us with an informative address on the subject, if we were to put a reserve price on our wool before we sent it from Australia, the holders of wool in other countries, which are also suffering by reason of the slump in prices, would offer their wool at a price a shade below the Australian fixed price, and in this way the Cape and Argentine sellers would secure our market.
-They cannot deliver the goods. Our merino wool is the best in the world.
– It is more than merino wool that has to be considered. Australia supplies, roughly, between20 and 25 per cent. of the world’s requiremente in wool, and every bale of Cape or Argentine wool that is sold reduces the sale of Australian wool. As to the practicability of enforcing the proposed guarantee, it would be for the Government to see that the penalty or forfeiture for a breach of the agreement was recoverable. No mere formal guarantee could be accepted; there would have to be a sound financial backing. But that, of course, would not remove the difficulty that I have just set out. The Prime Minister has very properly said that this matteris so serious that there should be negotiation about it with our partner the British Government, and I think that the true solution of the difficulty is to be found in a compromise. Hesuggests that if we make any arrangement here, it should be for a period of two months only, so that the full benefit of any compromise or agreement with the British Government may be immediately obtained. My view is that we have first to assess the. relative interests of Australia and the British Government. The preponderating interest is that of Australia, because we have most at stake by a long way. We are interested, not only in half the profit that may result from the sale of the 1,700,000 bales that have been carried over, known as the Bawra wool, but also in the full value of our present clip, to say nothing of the clip which is coming on. My counsel is, therefore, that the Prime Minister should be invited to negotiate with the British Government for the purchase of its interest in the Bawra wool.
– We can do that ourselves.
– No. If, as is said - because all sorts of statements reach us - the British Government threatens to throw this wool on the market, and its present market value is only £4 or£5 a bale, it would be a splendid investment, and the correct course, for Australia to buy it, having regard to her dominating and overwhelming interests in the matter.
– Does the honorable member suggest that the Commonwealth Government should purchase it?
– I would go even so far as to say in the last resort that the Commonwealth should buy out the British Government’s shareor interest. We need to get complete control of this wool. We have not that control now, because of the interest in it of the British Government.
-Why should we assume that the influence of the British Government is malignant?
-I do not assume anything of the kind. But’ the obligations of the British Government are great like our own, and that Government might readily be disposed to sell to Bawra or our Government on, say, three or five year terms. It would probably suit the BritishGovernment to do so. When the Prime Minister suggested, some twelve months ago, that the proper course was to withdraw the Bawra wool for a time, until the wool market had reassumed its normal condition, so that the current clip might be operated easily, that suggestion was received with disfavour. The British Government would naturally say, in reply to any proposal to hold over the Bawra wool for a period of two years or so, “ That is all very well for you, who want to sell your current clip ; but where do we come in ?” Naturally, it would not agree to the proposition.
– It was not only the BritishGovernment that objected; the proposal was ridiculed here, too.
– We cannot make to a partner a proposition which is solely in our own interests and more or less detrimental to his. But, if we can acquire the interest of the British Government in the Bawra wool at the present market rate, “ we shall have the whole position in our own hands. We can then put that wool aside for two or three years, or any suitable period, until, in the natural order of things, the world’s market returns to its normal condition. That wool can then be put on the market in such quantities as may be decided, and there will be no likelihood of any loss being suffered by us.
– It will not be Bawra wool then.
– It will be Australian wool. I am suggesting that the Australian Government should take the place of the British Government, and become the sole owner of its share. The stocks in England must be got rid of in some way, or some permanent arrangement made for its storage. I believe that in England the storage difficulty is serious, and necessitates some new arrangement being made for the storage of Bawra wool in order to leave accommodation for the new clip.
Mr.Fenton. - What about deterioration ?
– The honorable member for Grampians (Mr. Jowett) assures me that the depreciation will not be material.
– Why not dispose of the Bawra wool first?
– If we can secure absolute control of the Bawra wool we can dispose of it when and how we think fit.
– If we took charge of the new clip we could hold it back until the Bawra wool was sold.
– We could do what was best in the interests of Australia. But if the Bawra wool were immediately thrown on the market it would be disastrous to the Australian grower who owns the whole of the new clip and has only a half interest in the old stocks. I repeat that we should aim at securing complete control of the wool position by purchasing the outstanding interest of the Mother Country, which we can acquire at the present low market rates.
– That cannot be arranged for some months. Is the honorable member in favour of the Bawra scheme for the immediate future?
– The purchase from the Imperial Government might be arranged very soon.
– The position must be dealt with by negotiation, and possibly compromise, with the British Government. The Prime Minister will be in London in a period of about six weeks, and I submit that he should be permitted to negotiate with the British Government for the purchase of its interest in Bawra wool at the present market value.
– Not only he, but also Massey and Smuts.
– Just so, but I ammost concerned about Australia, and if we can get in first it will be very useful. I put forward my proposal as the best solution of the difficulty.
– That proposal does not in any way clash with that made by the Prime Minister.
– I understand that his proposal is that the price should be fixed, and that no export should be permitted except upon a guarantee that nothing less than that price will be accepted.
– A guarantee that the wool will not be sold below the limit to be fixed by Bawra. That limit can be altered.
– I do not think the House is justified in rejecting the expedient recommended to us by experts as a temporary scheme, particularly if we have any idea of securing complete control of the Bawra wool.
– The question is one for financial rather than wool experts.
– The advice of those gentlemen who have an intimate knowledge of the movements of the wool market, and who devote the whole of their thought to the subject of wool, should not be ignored. Indeed, I do not wish to take the responsibility of ignoring their advice at the present time, because I realize the terrible disaster that might result. I am willing that the experts, rather than Parliament, should take the responsibility.
– But we ought to seek theiradvice.
– Undoubtedly, and we should give temporary effect to their proposalpending what I believe to be the real and proper solution, namely, the acquisition by the Australian Government of the British interest in Bawra wool with a view to withdrawing it from themarket for the present.
– What does the honorable member mean by temporary?
SirROBERT BEST. - Something must be done immediately. About 1,200,000 bales are coming forward from the new clip, on which the banks have made their advances. It, therefore, becomes necessary for something to be done to guarantee that the new clip shallnot be sacrificed on the London market.
– How long should the guarantee continue - two months or six months?
– It should be only a temporary expedient until the
Prime Minister has an opportunity of negotiating with the British Government, say, two or three months. It is with great diffidence that I put forward this suggestion. I do not pretend to have the expert knowledge enjoyed by Sir John Higgins and the other gentlemen who control Bawra, but my proposal seems to me, as a business man, to bethe best possible solution. I am strengthened in my view by the statement contained in the circular issued by the Victorian Wool Buyers Association, comprised of other experts who also are qualified to speak, that the Bawra wool should be held off the market for a definite period of, say, two years, to enable the world’s markets and the woollen manufacturing industry to settle down. They say that when that is done every bale of the accumulated wool will be absorbed. As this is a solution that appeals to every honorable member, let us set to work at once to see how effect can be given to it. The wool buyers state, amongst other things, that those who controlthe Bawra wool refused to permit sales between 1st July and the middle of October last, and subsequently in January,and also from the 18th March until the present time.
– The whole trouble is that the wool was kept back in the first place.
– That is what I cannot understand. During the period mentioned, in which no sales of Australian wool were permitted, South Africa, Argentine, and other countries were securing markets for their wool.
– Who was responsible for that?
– I cannot say. But it is extraordinary that those other countries should have been permitted to jump ourmarket in that way. If there is an explanation of it, we should hear it, because the stoppage of sales has meant a very serious loss. Wool was sold by other countries while Australia had not an opportunity of marketing its wool, which was probably better,
– July to October is the period during which no new wool comes forward.
– But sales were continuing abroad. There were no sales of Australian wool in January, and none since the 18th March last, but there have been sales of wool by other countries.
– There have been sales of wool in Australia.
– But I am speaking of the London market. We are dealing only with the export wool, and I understand from the honorable member that nothing that is proposed is to interfere in any way with the requirements and necessities of local industries. I hope that will be made perfectly clear. While the honorable member for Grampians (Mr. Jowett) was speaking, the honorable member for South Sydney (Mr. Riley) raised an important question in regard to skin wool, and I understand the reply of the honorable member for Grampians to be that such wool represented only 5 per cent. of the gross production, and was not to be interfered with. The Government might let us have their definite assurance on this point. That is of the greatest importance to our industries and to the stock market, particularly at the present time, when the price of sheep has dropped from £2 to 10s. or 12s. per head. The fellmongering industry must be encouraged to purchase sheep and deal with skins and skin wool. I quite agree that we must thoroughly understand this situation so that none of our industries shall suffer by the operation of any arrangement or by the operation of any agreement made for the disposal of our wool.
– That is a very important point.
– It is indeed. I feel that we should direct our efforts towards solving this important matter. In my judgment, the solution lies in securing control of our own wool inthe manner suggested.
.- Seeing that the Prime Minister (Mr. Hughes) has referred the matter of the handling of our wool to the special consideration of the House, I feel that we ought to confine ourselves to the real subject at issue, whereas to a great extent time has been occupied to-day in wandering away from it and in discussing extraneous questions. There has been no greater production of wool during the war than there has been in previous years; as a matter of fact, because of drought conditions, there has actually been less production of this commodity, but owing to the fact that the nations have been unable to buy our wool and store it up for military purposes, a surplus has been created upon the cessation of hostilities to the extent indicated by the Prime Minister, namely, about 3,000,000 bales. Wool will continue to be produced approximately at the rate at which it was produced prior to and during the war, a rate which largely met with the requirements of the world and the capacity of the people of the world to purchase it. The 3,000,000 bales of surplus wool .are a millstone which is likely, not only for 12 months but possibly for many years to come, to be a drag on the market, and seeing that we produce 62 per cent, of the world’s supply of merino wool, to affect Australia more than any other country. Therefore it is important for this House to consider if there is any way out of the difficulty. It affords me a certain amount of pleasure in a sense to find the House realizing the importance of this primary industry to the whole community, and. how much the interests of the Commonwealth are wrapped up in its success; in fact, I find all parties willing to corner wool with the whole continent as a sort of combine, which I think we would be justified in doing. But honorable members are perhaps unreasonable in suggesting that British people, who ‘have a half interest in this accumulation of wool, should readily concede their half to us by some bargain or other. The British manufacturers and purchasers of wool will want to hav.e their say. and they certainly must be exercising on the British Parliament just as much influence as the people of Australia have upon. this Parliament. The suggestion, however, that we should buy out the British interest in Bawra wool is a very sensible one. It is perhaps a question that might be taken into consideration afterwards.
I quite agree that a. special Committee of this House should be . appointed to gather up all view-points upon this matter of handling our wool and put them in concrete form before the House as speedily as possible. I propose to move for the appointment of such a Committee.
This morning the Leader of the Opposition (Mr. Tudor) referred to people who are burning their surplus wool and destroying their sheepskins. Many persons have sent sheepskins and wool to the market, and their only return has been debit notes. Such is the position of affairs in Australia to-day.
There has been too much delay in the handling of the wool in which the British Government and the Commonwealth are interested. Our main object should be to get the commodity into consumption. It has been lying for two years without going into consumption.
– We ought to know who is responsible for the delay.
– That question remainsunsolved. Until the wool, goes into consumption it will be a drag on the market. It would be better to acquire it and store it, or put it into the h’and.s of nations who, although unable to buy it, have the machinery to put it into a more saleable form. We might enter into some share arrangement with them in order to get the wool out of the way. We might not get any money for it, but possibly we could get goods from them in return for it. At any rate, such aru arrangement would serve to get our surplus wool into consumption. While it remains out of consumption it will be the biggest deadlock possible to Australia. We are all concerned in the success of such a key industry, because if we cannot realize the money we have been accustomed to receive for our wool in the past we cannot establish credits in other parts of the world. I am prepared to move for the appointment of a Committee.
– There is plenty of time to do that.
.- The question we are considering is a most important one. We are suffering from the aftermath of the war. No doubt, during the war period we indulged in riotous living, and now comes the deluge. Many commodities in addition to wool appear to be. drifting, with’ results disastrous to Australia, and it behoves this House to do . everything possible to save the situation as far as it can be done. We must be particularly careful about the matter of handling wool. Too much disposition is shown by .honorable members to rush in and approve of the scheme submitted by the British Australian Wool Realization Association. The matter should first be thoroughly analyzed. I very much doubt whether the House is justified in handing over the control of such an important commodity to an outside body which is not responsible to this Parliament. During the war honorable members were crying out time after time that as a result of, handing over the control of commodities to outside bodies the Ministry were a cipher, and that administration was being carried on hot by Parliament, but by these outside bodies. We clamoured that we should get back, as quickly as possible, to normal conditions, yet here is a proposal which practically carries us back to the position in which we wereplaced during the war. It behoves us to be very careful in dealing with it.
This morningI had the pleasure of listening to the remarks of an honorable senator, who thoroughly understands the wool business, and who. is favorable to the proposal advocated by the honorable member for Grampians (Mr. Jowett). I refer to the Bawra suggestion to permit a Committee, not responsible to Parliamentin any shape or form, to control the future price of wool, and at the same time to utilize our Trade and Customs Department for the purpose of dealing with any person who will not enter into the arrangement promoted by them. The honorable senator we heard this morning said that the average value of the Australian wool clip during recent years was £47,823,000, but that this year it would probably drop to £18,000,000. He even went so far as to say that it might decline to £10,000,000. The situation is, indeed, serious. He pointed out that it was intended to fix the price of wool at 9d. per lb., notwithstanding the fact that the cost of production was 10.92d. per lb. Obviously, this must entail a heavy loss.
– Especially to the small growers.
– I am coming to that point.
– But there is no proposal to accept 9d. per lb.
– That is the proposal under the Bawra scheme, and I heard the senator this morning mention it. It is the scheme advocated by the honorable member for Grampians, who, however, carefully omitted any reference to these figures.
– The senator the honorable member is quoting is too intelligent to mention that the proposal was to fix the price at 9d. Surely, he said that it should not be below 9d. ?
– The Prime Minister said that the proposal made to him by these gentlemen was that the price should be 9d., and that he had gone a little further, and told them that he thought it might be a little less in order to tide the pastoralists over a period of a few months. But what I am endeavouring to point out is that between 9d. and 11d. per lb. there is a loss of 2d. per lb., which must be borne by some one. What, then, will be the position of the small sheep farmer who has to depend on the return he receives from a given number of sheep, according to the capacity of his land, in order to carry him over from year to year ? Of course, I will be met by the statement that most of these men indulge in mixed farming, and, consequently, will be able to get sufficient from other commodities to enable them to pull through the period of low prices for wool.
– No; they calculate on their total return. They cannot pull through if half their return is cut out.
– There are many men, especially in New South Wales, who, as the honorable member for Robertson will bear me out, depend entirely on sheep.
– Hear, hear !
– If the cost of production is11d. per lb., and the minimum price fixed for a given period is 9d. per lb., the small growers must inevitably go to the wall. They cannot hope to continued In that event, what is to happen to their properties?
– They will go to those who always win.
– Yes; they will fall into the hands of wealthy men who already own large tracts of country, or into the hands of the banks. And this notwithstanding all we have done by means of unimproved land values taxation to break up large estates.
– On the honorable member’s figures, the bigger the flock the bigger will be the loss.
– That is so, but the honorable member must not lose sight of the fact that those who have very large flocks did so well during the war, when they received 15½d. per lb. instead of 10d. per lb. - to say nothing of the dividend yet tocome to them from the proceeds of the unsold carry-over wool - that their banking accounts will help them to pull through. The small grower, however, must go to the wall. It would not be in the best interests of the country to do anything that would have the effect of sending the small man to the wall, and be in favour of the banking institutions or the big land-owners.
– Is it not better that the small man should get 9d. per lb. instead of having to accept,say, 3d. per lb. if the market collapses?
– I want, if possible, to avoid anything of the kind. My desire is that the small man shall not be compelled to take either 3d., or even 9d., per lb. for his wool.
I do not want this House to hurriedly accept the proposal now before us, a careful examination of which may show it to be in the best interests of the large landowners, and not in the interests of the small man. The honorable member for Grampians (Mr. Jowett), when speaking this morning, said that a sufficient return might be obtained from the wool which remained unsold in England, and onehalf of which belongs to the sheep farmers here, to tide our wool-growers over a given period with a payment of only 9d. per. lb. The 15½d. per lb. they have already received, and the dividend yet to be paid, would assist them to carry on with something less for this year’s clip. But if we have afew years of these depressed prices their finances will be exhausted. What, then, will become of the small man? The honorable member admitted this morning that the Bawra Company, whiletalking about fixing a minimum price, reserved to themselves the right to increase the price from time to time. That is to say, they are to be at liberty to put up the price whenever they like. The honorable member asked that the machinery of Government should be used to assist that combine that an export duty should be imposed on any wool sought to be disposed of outside of the combine for less than the price fixed by it. That, then, is the position. I do not want to see the price of our wool come down, and I certainly do not want the whole business to be placed in the hands of some outside body of men over which the Parliament has no control. Why should a body of men over which the Parliament has no control be given authority to fix the price, and to deal with the whole of the wool production of Australia ? If any one should dealwith our wool production it is the Government.
– I reckon it is the growers.
– Unfortunately, they cannot deal with it. If the honorable member could show us that they could,we would not nowbe debating this question. We have been told that the growers can no longer deal with the situation.
Mr.Fleming. - They can if we leave them alone.
– If the honorable member will show the House that the wool-growers, if left alone, can deal with the situation themselves, I shall certainly be prepared to assist him in seeing that they are not subjected to any interference.
Ifwe are compelled to accept a reduced price for our wool, or any other primary product, every section of the’ community will be seriously affected. We have, therefore, to do our best to present anything of the kind. But I object to any body of men outside the control of this Parliament being given power to fix the price of wool and to the machinery of the Government being employed to prevent any one coming into competition with them.
– That is not a fair statement of the position.
– I can only say that, so far, it has not been denied. I heard a member of another place put the facts very lucidly, and the honorable member for Grampians this morning agreed with him, and said that the Bawra Company would not be answerable to the Government.
– The honorable member said that a “body of men” wanted this power, in order to shut out competition. They do not mind how many come into’ competition with them as brokers, provided they are all subject to the one condition.
– Exactly. They do not want any one to be allowed to dispose of wool except subject to the conditions imposed by themselves. . That is the position taken up by this company or combine. I object to that sort of thing.
– Does not the honorable member believe in collective bargaining ?
– I do not believe in any combination of private individuals being allowed to exploit any section of the community. I favour collective bargaining, and I am urging that in this case it should be done through the Government of the country.
– Is this not exactly what the miners unions do now?
– I am stating the position as it occurs to me. There is no escape from it. The Prime Minister, in concluding his speech yesterday, said that he was not convinced that the remedy suggested by Sir John Higgins would cure the disease; he wasnot satisfied that the proposed scheme would prove satisfactory. I am stressing that point. I am endeavouring to show the direction in which we are drifting. We are drifting once more towards the state of things that arose during the war. We were condemned in the press, and by many citizens, because during the war we, as a Parliament, lost control of the public purse, and also because we did not take control of different commodities in order to prevent profiteering. It is now solemnly proposed that we should vest in a body of men completely outside the control of this Parliament, power to deal as they please with the whole wool situation.
It was suggested this morning that a Committee of members of this Parliament should be appointed to investigate the question. I have been awaiting an opportunity to submit . an amendment, which will allow the House to decide whether or not such a Committee should be appointed. The amendment provides for the addition of the following words to the motion, “ That the paper be printed.” : - and that a Committee be appointed from this House and the Senate to investigate the present position of the wool-growing industry with aview of recommending the best method of dealing with the disposal of wool.
That, surely, is a question with which the Parliament should deal.
– We are dealing with it.
Mr.CHARLTON. - We are attempting to deal with it without having all the facts before us. Many honorable members consider that such a Committee as I propose should be appointed.
-where would the wool market be by the time that the Committee had completed its inquiries?
– I do not propose the appointment of a Committee that would occupy much time in making an investigation. We have in this Parliament men who are thoroughly conversant with the wool business ; representatives of the wool interests could be chosen from both sides of the House.
– But the honorable member’s proposal to appoint a Committee to investigate the present position of the wool industry would mean a delay of six months.
– A Committee consisting of two members of this House, two members of another place, and two outside business men could inquire and report within a week or a fortnight.
– If appointed, it should be asked to report within a week.
– I should not object to that. The Committee could make inquiries and bring in a report that would materially help us in coming to a decision. The presentsituation is very unsatisfactory. The Prime Minister himself confessed before leaving for England yesterday that he was not satisfied with the negotiations. He made a hurried statement and admitted that he was not satisfied in his own mind as to what was the best course to pursue. He desired that we should discuss the whole question, and that the disposal of the carry-over wool should be held over for acouple of months in order that he might, if possible, do something on reaching the Old Country. A Committee such as I suggest could complete its investigations within a week, and submit a report to the House, on which we could come to a decision. The Prime Minister could then be duly advised. I do not want this House to be forced into accepting the proposal before it.
– The Prime Minister asked the House to discuss the whole question.
Mr.CHARLTON.- That is why I say that a Committee of members of this Parliament who are thoroughly conversant with the wool business should be appointed to inquire and report. With all due respect to those outside, I believe that Committees consisting of members of this Parliament do better work than committees consisting of so-called business men from outside. My experience of the reports of Commissions consisting of outside business men is that they are about the poorest that are put before us. Such Commissions also occupy more time in conducting their inquiries than do Committees or Commissions consisting of members of this Parliament. Surely we should not be expected to accept this proposal on the mere statement that the wool-growers are favorable to it. Surely we should not be asked to empower a body of men over whom this Parliament has no control to utilize the Customs Department to keep up the price of wool, and probably in the long run to ruin the small growers. Why should we force the small man to put his property on the market, or to mortgage it, as probably many would have to do?
– The banks have already threatened to foreclose on some of them, and are forcing some to put their stock on the market.
– That is why we want an immediate decision.
– And a Committee of members of this Parliament could investigate the position, and report within a week. If we deal with this matter without having before us the fullest information, we may, in our endeavour to protect the wool industry, do something that will not be in the best interests of the whole of the people. We should do all in our power to prevent the collapse of any of our industries, and it is because of the seriousness of the situation that I speak in this way. If we act in the absence of complete information, we may land ourselves in a very difficult position. We may be told, later on, that we were unmindful of our duty when we handed over this power to some outside body over which we had no control. No reasonable objection can be raised against my proposal. Why should we be asked to rush in and deal with this question off-hand? I invite honorable members to carefully read the speech made by the Prime Minister. He went away still undecided as to what should be done, and he told us that be had recommended a certain course, with which the representatives of the wool-growers were not prepared to agree. The House ought to be in possession of all the available information, and consider the question in all its bearings, in an effort to arrive at a conclusion which will prove of great help to the wool industry of Australia. If we permit the wool industry to go down, it will be only a matter of time when all the other industries will follow. We know that on the other side of the world the bottom is falling out of all the markets, and it is on these markets that we depend for the disposal of our surplus. We have to protect the interests of this country during the crucial period before us, and that can only be done by our being placed in the possession of the fullest information within the shortest possible time. I have no desire for any delay of months, but would prefer to deal with the matter within a week. I object to power being given to any body outside this House to regulate the prices of commodities in the future. The war is now over, and we should deal with a matter of the kind ourselves, taking the fullest responsibility for our acts. We ought to have sufficient intelligence to devise means to save the country without handing over, holusbolus, such a power to a committee of men, who are interested, and out of the control of this Chamber. I desire to move an amendment.
– I hope the honorable gentleman will not do that now.
– What would the Treasurer like me to do? I do not wish to sit down, and thus lose my opportunity to speak further.
– The honorable member, if he moves an amendment now, may commit some honorable members on a pre-conceived view, before the whole case has been put.
– All I suggest for the moment is that the honorable member for Hunter (Mr. Charlton) leave the field open. I wish to inform my mind more fully on the matter during the week-end. When we meet on Wednesday there may be some definite proposition before the House.
– The honorable gentleman thinks that if an amendment is moved now it may pledge honorable members ?
Mr.CHARLTON. - I do not wish to do that. I may say that I did not consult my party before I proposedto take my present action. Under the circumstances, I ask leave to continue my speech at a later stage.
Leave granted; debate adjourned.
Motion (by Sir Josephcook) proposed -
That the House do now adjourn.
– Does the Government propose to afford members, who have private business on the notice-paper, an opportunity to discuss that business this session? It will be remembered that last year, during this session, the Government, with the consent of the House, and for the reasonthat they had a rush of business, took away the time allotted to the discussion of private members’ motions. I haveon the business-paper a most important motion in reference to oldage and invalid pensions, and I should likean opportunity to discuss it without taking steps which are drastic. There are quite a number of other proposals by private members that ought to be dealt with, and I understand the Government have some intention of affording an opportunity for their discussion.
– I cannot say in a moment what will happen in regard to private members’ business. We must, first of all, see how we get on with the Tariff. It may be that we shall require to sit another day a week. If the honorable member will repeat his question a little later on, I shall see that he gets an answer. I do not care to give any definite undertaking now in view of arrangements already made. I know that the honorable member is seeking an opportunity to discussa question in which he is intensely and profoundly interested, and if I can see my way to give him a definite assurance I shall do so. All I ask now is that he will raise the matter a little later.
Question resolved in the affirmative.
House adjourned at 8.51 p.m.
Cite as: Australia, House of Representatives, Debates, 29 April 1921, viewed 22 October 2017, <http://historichansard.net/hofreps/1921/19210429_reps_8_95/>.