House of Representatives
14 October 1921

8th Parliament · 1st Session



Mr. Speaker (Hon. Sir Elliot Johnson) took the chair at 11 a.m., and road prayers.

page 11978

RESTRICTION OF IMPORTATIONS

Mr.WATKINS. - I wish to know from the Minister for Trade and Customs when the Anti-Dumping Bill and the Tariff Board Bill will bo proceeded with?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The Senate’s amendments of the Tariff Board Bill are set down on the notice-paper for consideration, and the motions preliminary to the introduction of the Anti-Dumping Bill are before the Committee of Ways, and Means. I presume that the business in connexion with both measures will be proceeded with at the earliest possible moment.

page 11978

QUESTION

AUSTRALIAN NAVY

Mr BRENNAN:
BATMAN, VICTORIA

– May we expect from the Minister for the Navy an early statement for the allaying of the growing popular fear that all navies, including the Australian Navy, are not to be scrapped after all?

Mr LAIRD SMITH:
Minister for the Navy · DENISON, TASMANIA · NAT

– The Prime Minister and the Minister for Repatriation in the Senate have already replied to the rumours about the Australian Navy.

page 11978

QUESTION

SURPLUS WHEAT

Mr.MAKIN asked the Prime Minister, upon notice -

What is the surplus of wheat at present held by the Wheat Board in the respective States?

Has a market been found for such wheat?

If not, will the Government endeavour to arrange with the Wheat Board for such surplus of grain to be made available to millers for gristing at world’s parity rates?

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

– The answers to the honorable member’s questions are as follow: -

  1. and 2. It is not in the commercial interest of the growers that the quantity of wheat still held for sale by the Wheat Board should be made public at this juncture.
  2. The Commonwealth Government does not propose to ask that thereshould be any variation of any agreement made between the Governments concerned and the Wheat Board.

page 11978

QUESTION

ARREARS OF TAXATION

Mr FENTON:
MARIBYRNONG, VICTORIA

asked the Treasurer, upon notice -

  1. Whether the Treasury Department has collected any appreciable amount of the £7,500,000 arrears of taxation payments since the delivery of the Budgetspeech?
  2. Is the Treasurer hopeful of collecting the full amount of arrears. If not, what action is contemplated to recover this large amount!
Sir JOSEPH COOK:
Treasurer · PARRAMATTA, NEW SOUTH WALES · FT; ANTI-SOC from 1906; LP from 1910; NAT from 1917

– The answers to the honorable member’s questions are as follow: -

  1. The amount is not £7,500,000 but £8,928,000. It is difficult to furnish statistics covering broken periods, but I am in a position to say that the arrears of taxation collected from 1st July to 30th September last were more than £3,000,000.
  2. I am hopeful that the remaining arrears will be collected in due course.

page 11979

QUESTION

SHALE OIL

Mr MARR:
PARKES, NEW SOUTH WALES

asked the Minister for Trade and Customs, upon notice -

Whether he can state in respect of the bounty paid for the production of shale oil -

  1. How much oil was produced for the year ending 30th June, 1920, and the year ending 30th June, 1921 ?
  2. How many men were employed on a fiftyweek basis for the year ending 30th June, 1920, and the year ending 30th June, 1921?
Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The answers to the honorable member’s questions are as follow: -

  1. The quantity produced during the years named, was as follows: -
  1. There is no information available which would enable an answer to be furnished to this question. The average number of employees engaged in the industry during these years was as follows: -

A return giving, full particulars regarding employees, &c, was laid on the Table of the House on the 29th September, 1921.

page 11979

LOAN BILL. (No. 2)

Message recommending appropriation reported.

Ordered-

That the message be considered in Committee forthwith.

In Committee (Consideration of Governor-General’s message).

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

– Before proceeding with the ordinary business of the day, I ask honorable members to give me authority to borrow £5,000,000. The Bill which I propose to introduce will not make any appropriation; it will merely authorize the raising, when circumstances are favorable, of a loan for the amount I have named.

Mr RICHARD FOSTER:
WAKEFIELD, SOUTH AUSTRALIA · ANTI-SOC; LP from 1910; NAT from 1917; LP from 1922; NAT from 1925

– To pay for sugar?

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

– No. For general purposes.

Mr Atkinson:

– Is it proposed to raise the money locally, or in Great Britain?

Mr Makin:

– Or in. America?

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

– I do not propose to raise the money locally; I hope to go to that market where we have always been treated with great consideration.

Mr Wienholt:

– Is the money required to cover the future deficit?

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

– That is a remark which I think is out of place now. The moneyis not needed to cover a deficit. There is plenty of money in the Treasury to cover any deficit that the honorable member may have in his mind. Before any of the money which I ask leave to borrow can be spent it will have to be appropriated by Parliament.

Mr Gregory:

– Is there any urgency ?

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

– Yes. I want this authority as soon as I can get it.

Mr Fleming:

– Cannot the Treasurer give us some of the reasons why he wants the. money in such a hurry ?

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

– I cannot.

Mr Gregory:

– It is an extraordinary proposal.

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

– There is nothing extraordinary about it.

Mr Gregory:

– We have had nonotice of it.

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

– I am merely asking for authority such as has always been obtained before without difficulty.

Mr Hill:

– Can you tell us what the money is needed for?

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

-To begin with, Treasury bills amounting to £2,000,000 have to be redeemed in London. That is one of the purposes for which we wish to raise a loan. Then, again, last year, the market being unfavorable, we had to finance our own public works with Treasury bills raised here. These will be redeemed when a favorable opportunity offers. The passing of this measure will not increase the total indebtedness of the Commonwealth by one penny. I wish honorable members to get that into their minds. The purpose is really to liquidate our liabilities and pay our debts.

Mr Richard Foster:

– It is simply a matter of adjustment.

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

– That is really all that it is. I have said two or three times already that I am seeking only authority to take advantage of the market whenever it shall be favorable. I move -

That it is expedient that an appropriation of moneys be made for the purposes of a Bill for an Act to authorize the raising of the sum of £5,000,000 for certain purposes.

Mr CHARLTON:
Hunter

, - The Treasurer has come to this House to obtain its sanction to enable him to take advantage of any favorable opportunity that may arise on the London market for the purpose of raising money really to redeem loans already made.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The Treasurer also mentioned that portion of the money had been expended upon public works.

Mr CHARLTON:

– The right - honorable gentleman did mention public works, bub h© also said that the purpose was definitely to redeem Treasury-bills.

Sir Robert Best:

– To what amount?

Mr CHARLTON:

– I do not know.

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

– I said £5,000,000 -£3,000,000 here and £2,000,000 in London.

Mr CHARLTON:

– That is a perfectly fair statement. The Treasurer informs us that the object of this measure is to enable him to take advantage of a favorable opportunity to borrow £5,000,000 to redeem loans already in existence. No money is appropriated by this measure. If, by agreeing to this proposal, the Treasurer is placed in a position to take advantage of favorable conditions of the money market to effect a saving for the Commonwealth, the House can raise no objection. This will not add an additional farthing to the debts wo have already incurred. Is not that correct?

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

– That is so.

Mr CHARLTON:

– lt is pleasing to note the change which has taken place in the tone of the London money market, and one is tempted to look for the reason for it. Only recently the New South Wales Government floated a loan on the London market which was considerably over subscribed. We know that another Labour Government, the Queensland Government, were compelled, if I may put it in that way, to go on to the American market for a loan. Why?

Sir Robert Best:

– Because the Queensland Government adopted a policy of repudiation.

Mr CHARLTON:

– No; but because certain people in Queensland, who were opposed to the Government policy-

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

– Why raise these questions in discussing this matter?

Mr CHARLTON:

– I am not; discussing the propriety of the Government going on to the market for the purpose of borrowing money, as the Treasurer now proposes, but I am endeavouring to show what has made the London market more favorable for the Commonwealth and for other Australian Governments now than it was some time ago. I say that the recent action of certain people in Queensland in sending a delegation to Great Britain, and prevailing upon those who control financial matters there, to refuse to lend money to that State-

Mr Corser:

– That statement was refuted.

Mr CHARLTON:

– No, the factsstand. That action had the effect of forcing the Queensland Government to go outside of Great Britain to obtain money. For the first time in the history of the Dominions, they -Vent to the American money market, where they obtained what they required without any trouble at all.

Mr Wienholt:

– At what rate of interest ?

Mr CHARLTON:

– The Queensland loan was taken up in America von terms which, according to the Treasurer of Queensland, will eventually be shown to be less than 6 per cent.

Mr Fleming:

– How can the Queensland Treasurer forecast the rate of exchange ?

Mr CHARLTON:

– I do not know. I assume that he was advised in regard to the position by the best financial men s he could find before he accepted the loan, and it was shown that the exchange was likely to alter favorably, not only for Queensland, but for Australia generally. No less an authority than Sir Denison Miller backs up this view by saying that the loan was raised in America probably at a cheaper rate than a loan could have been raised in Great Britain.

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

Sir Denison Miller was the agent of the Queensland Government in the matter.

Mr CHARLTON:

– Yes, and he is a good agent. He has done splendid work for the Commonwealth also in connexion with the Commonwealth Bank and in many other ways. The facts show that the Government of Queensland were well advised, and made a good deal. The point I wish to make is that if the Queensland Government had not made a move to go beyond the money bags in Great Britain, and had not gone to another country to raise the money they required, other Australian Governments would not be given the favorable terms now offered them for raising money in London. Immediately the action of the Queensland Government was made known a change took place in the tone of the London market, and the New South Wales Government were able, not only to float their loan, but to have it oversubscribed. It is evident now that the Treasurer has been advised from Great Britain that circumstances have so changed there that this is a suitable time to put a loan on the market.

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

– I can conceive of nothing more likely to prejudice our loan than this kind of talk.

Mr CHARLTON:

– I am not concerned about what the Treasurer conceives in the matter. I regard it as my duty in the position which I occupy to state what appear to me to be the facts, and I say that if the British money lenders are not prepared to quote favorable terms for a Commonwealth loan because of criticisms levelled at them here, we shall have to do what the Queensland Government did, and go elsewhere for the money we require.

Mr Richard Foster:

– The honorable member should talk for himself when he speaks in that way.

Mr CHARLTON:

– I am speaking fcr myself.

Mr Hector Lamond:

– The honorable member is not doing the Commonwealth much good in making such remarks.

Mr CHARLTON:

– I may not be, but I know why certain Queensland people were delegated to go to Great Britain.

It was to defeat the intention of the Queensland Government, and prevent them doing the work of the State.

Mr Hector Lamond:

– Does the honorable member put himself on a level with those people?

Mr CHARLTON:

– No, I do not.

Mr Hector Lamond:

– The honorable member is doing so now.

Mr CHARLTON:

– No; I am merely stating the facts. It is strange that immediately I begin to do so we have a number of honorable members opposite interjecting. They know that what I am saying isabsolutely correct, and that the delegation from Queensland was sent to Great Britain for the purpose of damaging Labour Governments in all the States.

Mr Corser:

– It was the repudiation of the Queensland Government that caused that delegation to be sent.

Mr CHARLTON:

– We have no right to interfere with the policy of the Queensland Government any more than Great Britain has the right to interfere with our policy. She does not do so. She minds her own business, and we should also mind our own business.

Mr Corser:

– British investors minded their own business in refusing the Queensland loan.

Mr CHARLTON:

– The people of Queensland returned the Labour Government there by adult franchise, and that Government had a right to carry out their policy without interference from the minority. Honorable members opposite might just as well contend that the Opposition, although we are in a minority here, have the right to prevent the policy of the Government from being carried out. The Queensland Government were returned by the electors of that State, and, because they were defeated at the elections, certain people in Queensland almost immediately took action to cry down the credit of their cwn State in order to get even with the Labour Government. I have nothing to say against the proposal submitted by the Treasurer. I consider that he is doing the right thing. That is a fair statement to make. I consider it wise that, by the passing of a measure which will not increase the actual indebtedness of the country in any way, he should be given authority to take advantage of the money market whenever the opportunity presents itself to do something that will be in the interests of the Commonwealth.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES · FSU; CP from 1920

. -I rise merely to state that the carrying of this proposal seems to be largely a matter of form.

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

– It is always regarded as a formal matter.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES · FSU; CP from 1920

– I deprecate the tone of the discussion which has taken place concerning borrowing abroad. I should like to say, in reply to some of the arguments used concerning the improved tone of the London money market towards Australian loans, that I consider that the fact that the New South Wales loan was over-subscribed was due rather to the visit to London of the late Premier of New South Wales, and his assurance that the Lands Acquisition Act would not be proceeded with, than to the raising of the Queensland loan in another market. With regard to the question of borrowing, I have only to say that the granting of this authority will not commit the House to any expenditure until an appropriationhas actually been agreed to. If money is expended in retiring certain Treasury bills, I take it that the House will be afforded an opportunity to discuss the circumstances in which it has been so used. As a word of warning, I would point out that even if loan money is now more readily available in England or any other country than it has been for some time, that is no reason why it should be spent foolishly or extravagantly any more than when it is hard to obtain.

Mr LAZZARINI:
Werriwa

– I should not have risen but for the remark made by the Leader of the Country party (Dr. Earle Page) that the improved state of the money market at Home was probably due to the fact that the late Premier of New South Wales, Mr. Storey, when in England, gave a guarantee to the British Government that the State Land Acquisition Act would not be put into force’. That is an absolute misstatement. Mr. Storey gave no such guarantee.

Mr Hector Lamond:

– He gave an assurance that the repudiation clauses of the Bill would not be proceeded with.

Mr LAZZARINI:

– He gave no such guarantee. I deny that there were any confiscatory clauses in the Land Acquisition Bill introduced by the State Labour Government of New South Wales. When the honorable member speaks of confiscatory clauses he shows that he ia unable to read intelligently an ordinary Bill. The only alteration made in the Bill was that the clause providing that owners of land acquired should be compelled to take bonds was amended so as to provide that they should be paid in cash. The feeling created by the remarks made by the Deputy Leader of the Opposition (Mr. Charlton) shows clearly that the matter touched on by him is a rather bitter pill for honorable members opposite to swallow. Although the Country party are not prepared to support the Government in their ordinary financial proposals we find them falling in.to line behind the Treasurer in this case, because it involves one of the basic principles upon which they are in agreement with Ministers. It is unquestionable that the action of the Queensland Government in hurling defiance at the moneylenders of Great Britain, who were trying to govern this country and to dictate what legislation should be passed by the State Parliaments, has had a good effect. The Premier of Queensland (Mr. Theodore) had sufficient courage to defy them. He told them that his Government would go elsewhere for money, and his action in giving effect to that threat has brought them to heel. That is why the money market in Great Britain is easing. The Treasurer now wants to rush in, grab some of the cheaper money now offering, and take all the credit for it.

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

– Nothing of the kind.

Mr LAZZARINI:

– The right honorable gentleman should thank Heaven that a man of Mr. Theodore’s pluck is at the head of the Queensland Government, and is prepared to take up a strong attitude.

Mr Hector Lamond:

– The Labour Conference does not seem to be prepared to follow him very strongly.

Mr LAZZARINI:

– That is not so; the honorable member as usual is indulging in misrepresentation. Trose only tocontradict the statement made by the Leader of the Country party. Iresent the stupid misrepresentation which the daily press of this country and all who are opposed to Labour Governments in Australia have indulged in. To assert that the late Mr. Storey while in England gave away anything that was vital to the principles of Labour is to say what is not correct, and those who say that he did so are maligning a dead man. : Mr. HECTOR LAMOND (Illawarra) [11.26]. - I am afraid that there was more of politics than of finance in the speech made by the Deputy Leader of the Opposition (Mr. Charlton), as well as in the speeches of others who followed him,.

Mr Mahony:

– What about those who will follow the honorable member?

Mr HECTOR LAMOND:

– They will probably revert to the bad example set by the Deputy Leader of the Opposition. This is no time for party leaders to promulgate their views at the expense of the Commonwealth as a whole. Honorable members opposite will have a splendid op- portunity next week to express all their extraordinary views with regard to what has happened in Queensland and New South Wales, and they will better serve the cause of Labour, as well as the cause of the Commonwealth, by allowing a measure of this kind to pass without debate.

Mr MAKIN:
Hindmarsh

.- I join with the Deputy Leader of the Opposition (Mr. Charlton) in expressing my pleasure that the financial position 13 more favorable than it has been for some time. I feel, however, that the Government are pursuing a wrong policy-

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

– Is it a wrong policy for the Government to pay their debts?

Mr MAKIN:

– That is not my contention. I feel that the Government should confine themselves to securing their credits and financial accommodation within the limits of the Commonwealth itself. They have full control, and I do not know why. they do not avail themselves of the opportunity to secure locally the accommodation they require, so that the people may have the full advantage of their own credits.

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

– Does not the honorable member recognise that every £1 I borrow locally is a withdrawal of capital from the productive enterprises of the country ?

Mr MAKIN:

– I would remind the right honorable gentleman that the raising oi money locally by the Common wealth does not take that money out .of use. It is still available for carrying on the enterprises of the country.

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

– May I remind the honorable member that this is a quite unusual debate? I suggest that he discuss these academic questions on a more convenient occasion.

Mr MAKIN:

– The ventilation of facts will do no harm. It will help us to understand the position more clearly than we have done.

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

– Honorable members will have ample opportunity to discuss these matters next week.

Mr MAKIN:

– This is the proper time and place to give expression to my views on this subject. As to borrowing abroad, I think that the British financier has not been as patriotic’ in his regard for the interests of Australia as many people would have us believe.

Mr McWilliams:

– Did you ever know a money lender to be patriotic?

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

– Tes. The British money lender was most patriotic all through the war, and his patriotism was expressed in hard cash.

Mr MAKIN:

– Well, I will remind the Treasurer of an occasion when the British money lender did not pursue a patriotic course, and my statement may oe proved by facts that are available. When the Queensland Government were endeavouring to secure accommodation in the British money market certain big business interests of that State made overtures in financial circles of the Mother Country, with the result that the Queensland Government were embarrassed in their negotiations. They found that the British financiers were not pre- pared to lend money unless they could dictate the domestic policy of the Queensland Government, although at the same time they were prepared to give financial assistance to Austria, an alien, and one of the Empire’s former enemies.

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

– What the honorable member is saying is misrepresentation amounting to falsehood.

Mr MAKIN:

– I am giving the House facts as I know them.

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

– The statement is not true m any particular.

Mr MAKIN:

– If the honorable the Treasurer can show in what respect it is inaccurate I shall be pleased to have the information; but I challenge the right honorable gentleman to prove other than what I have just declared to be a fact. When the late Mr. Storey was in England he had to meet the same financial interests, and overtures were made to him. The British financiers wanted to dictate the domestic policy of his Government.

Several honorable members interjecting,

The CHAIRMAN:

– Order ! Honorable membersmust cease these interjections from both sides of the House. They are becoming intolerable.

Mr MAKIN:

– I am not prepared to delegate to British or any other financiers authority to govern in this way. The people must govern this country. Therefore, I commend the action of the Queensland Government in the course they have taken to secure financial assistance. I should, of course, like to see all loan money raised within the Commonwealth, but as this was not in the power of the Queensland Government they have done a great service to the Commonwealth in breaking away, and demonstrating that if the British financier is not prepared to treat Australia fairly, accommodation can be obtained elsewhere. In the face of this intrigue on the part of great financial magnates and institutions of Great Britain, it is desirable that the Commonwealth should, at the earliest possible moment, take control of its own finances, and as far as possible seek within the Commonwealth what financial accommodation may be required, so that we may not be adding to our interest obligations abroad.

Mr GREGORY:
Dampier

.- It is, I think, undesirable that the subject now under discussion should be made the occasion for any display of party politics. I am sorry that a promise was made that the authority would be given to-day, because it is advisable that we should seriously consider the financial policy of the Government and of Australia generally.

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

– Honorable members will have that opportunity when the loan proposal is brought down. This is merely the authority to borrow. I have never known a debate to take place before on a similar motion.

Mr GREGORY:

– In view of the enormous indebtedness of Australia it is advisable that Parliament should seriously consider how far we are going with this borrow-and-spend policy that has been in vogue for so many years. The honorable member who has just resumed his seat (Mr. Makin) said that he desired that the Commonwealth should obtain all its financial requirements within Australia. Whilst, perhaps, that might be possible, for the time being he must surely realize that the borrowing of large sums of money for governmental purposes from the banks and financial institutions of the Commonwealth will unduly draw upon money essential for the building up of our industrial resources. It must be our purpose to safeguard the Commonwealth in this respect. I hope that when amend-‘ ments to the Constitution are being considered some effort will be made to curb the borrowing powers, both of the States and Commonwealth Governments. The common sense of Parliament ought to dictate the wisdom of this course. Do we all realize that, between now and 1927, outstanding loans amounting to about £350,000,000 will have to be redeemed ? I do not know what the interest bill is today, but in 1919 it was approximately £30,000,000 per year, or very nearly £6 per head of our entire population. The Treasurer himself has about £200,000,000 of short-dated loans maturing between now and 1927, and the States something like £150,000,000, most of which was borrowed at 3 per cent., and 3½ percent., while it will probably cost us anything from 6 per cent.,6½ per cent., and 7 per cent. to redeem the loans. On the top of all this, nearly all the State Governments are proclaiming their desire to borrow huge sums of money, careless apparently whether it is going to be spent in reproductive works or not. If honorable members examine the balance-sheets of the various State railway systems they will find that enormous losses are being incurred, and the most serious feature of the whole business is that, although there has been a considerable addition to the mileage of the various railways, the freight haulage from the country to the coast is getting les3. I am hoping that an early oppor tunity will Be ‘ given to honorable members to discuss these financial matters and see whether the several Governments, Federal and State, cannot be brought to realize the necessity of living within their means, and endeavouring to make the country self-supporting. If we do this there will be no question of complaining that Great Britain, or any other country, will not lend us money, and we shall feel that we are on a fair way to work out our own destiny in this land of so many resources.

Mr WEST:
East Sydney

.- If there is one question more than another to which honorable members should pay attention it is that of raising loans. We are afforded few opportunities of learning from the Government the exact position in regard to our borrowing on the other side of the world, but having endeavoured to study the question with the small amount of information made available, I understand that certain Treasury bills are now falling due, and must be met. We have had no knowledge of what is being done in respect to these’ issues. This lack of information also applies in respect to the administration of the States.

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

– I have told the honorable member on several occasions that of the Treasury bills £2,000,000 was applied to the payment for sugar and £3,000,000 to public works here.

Mr WEST:

– On a previous occasion when a loan was raised for £5,000,000, I made the statement that the money was required in order to “alleviate the acute exchange position in London, but the Treasurer replied that the money was required to meet the debt on our .sugar purchase. What is the difference? Paragraphs had appeared in the London financial papers a couple of months earlier indicating that financial people in London were endeavouring, for exchange purposes, to get £5,000,000 worth of gold which the Commonwealth was keeping in reserve as a backing to our note issue, but our Treasurer said, “No, we cannot touch that reserve,” and proceeded to raise a loan of £5,000,000 in London. I worked out the cost of raising that money, and found it was floated at £95, with the option of twenty years’ duration; the interest averages £6 14s., and at the end of the period we will have paid to the investor £6,725,000, and, adding the amount of loan, £5,000,000, the total payment will have been £11,725,000; the price to the borrower is higher than any previous flotation on account of the* Commonwealth. I do not make this statement solely from my own knowledge. Financial experts in Sydney have also investigated the matter closely, and supplied me with the information. The question of the control of out loan issues in London is another matter for our earnest consideration. I have always endeavoured to have this work transferred to the Commonwealth Bank from the gentlemen in London who now do it for us. When any Australian Treasurer goes to London to raise money the usual method is for him to be invited by the Governor of the Bank of England and another gentleman, whose name I need not mention, to a dinner, at which a mutual agreement is arrived at between all the parties concerned. The only persons who know that a loan is about to be issued are the underwriters and members of the London. Stock Exchange. The public of Great Britain are not made acquainted with the fact that they can invest in an Australian gilt-edged security until the actual issue is made. If we had a Government in power with some understanding of financial questions, the present system of obtaining loans would be abandoned. Only Labour Governments in Australia have broken away from the ordinary procedure and created precedents, such as has just been done by the Queensland Government. No selfrespecting Ministry, charged with the responsibility of governing a free Democracy, would have done other than the Queensland Government has just done after its rebuff by the British financial magnates. A gentleman who does a good deal of writing on financial questions, and is a member of the National League, told me the other day that one thing the Queensland Treasurer had done was to create competition among investors in Australian stocks, arid that this would great v -benefit Australia, just as the manufacturers benefit by competition in their own lines. Whenever I have’ the opportunity to do so I shall seek to have an alteration brought about in respect to the issue of Treasury bills. Parliament knows nothing about these transactions. The country could be involved’ in indebtedness to the extent of millions of money without any say in the matter. We have an illustration of this at the present time. The Commonwealth Government have already borrowed the money covered by the proposed loan, and not one honorable member was aware that Treasury bills to that extent had been issued. It is only when the bills fall due that money has to be raised in the ordinary way to meet them. This is a loose method of conducting the finances. No business man would withhold from his principal the fact that he was raising money by overdraft, and there is very little difference between borrowing by the issue of Treasury bills and raising money on overdraft. We shall not have very much opportunity of talking about the maladministration of the present Treasurer (Sir Joseph Cook). He will be leaving us shortly, and when he has gone the Government will say, “ Oh, that was done by Sir Joseph Cook. He is gone, and we are a new Ministry now.” That will be the position. The proposed loan is not for war purposes. The time is coming when borrowed money will not carry the rate of interest which is at present being paid, and we ought to provide for the renewal of the -loans expiring in 1925 and 1927 at a lower rate pf interest than was paid during the war period. If the Government intend to deal with the financial problems confronting them, they should have the courage and patriotism to give the business men of Australia an opportunity of lending money at a lower price, because no country oan hope to progress if the existing rates are to continue. At present the insurance and other financial institutions are asking for 7 per cent, to’ 9 per cent, interest, and as in most instances they hold the land as security, they are working on a very safe basis. Gild-edged securities should be carrying a lower rate of interest than was charged on the last loan, all of which should have been taken up, I believe, at a- lower rate. Although the big financial institutions may not have subscribed to the same extent, there were a number of private individuals who would have been glad -to take up bonds for small amounts in order to be in possession -df sound securities. If the members of the Government ‘ have sufficient ability - .which I very much doubt - they should tackle the financial problem in a business- like way. The records of Labour administration show that we do not wait for precedents, but that we establish, them when we think it desirable in the interests of the community. That is what we did when in office, and we achieved great success by viewing financial matters in. a broad national spirit. The present system of borrowing cannot continue, as the Treasurer (Sir Joseph Cook) seems to be acting recklessly and without regard for the future. In considering our financial position we have to look to the future, and legislate in the interests of our offspring. We would be neglecting our. duty if we did not bring under the notice of the Government and the people of the Commonwealth the fact that money is being raised in a reckless and haphazard fashion. Some of the recent loans, particularly those floated during the war period, have no securities behind them. One half of the money spent in connexion with War Service Homes has been squandered in consequence of reckless administration, and some Governments would not have been allowed to remain in office for an hour if they had pursued the policy adopted by this Government. » I have availed myself of this opportunity, and as the representative of East Sydney I shall avail myself of every opportunity that presents itself, to endeavour as far as lies in my power to place Australia financially on. as high a pedestal as possible, so that our children may not be left a burden that may prove too heavy to bear. I am sure that the Treasurer (Sir Joseph Cook) will not condemn me for any “action of mine in this regard. The right honorable gentleman will not be here long to hear me express my opinions ; and, possibly, when he has gone, there will be a change of Government, and, if the necessary reforms are made, the new Government, acting on a well-known precedent, will take all the credit for any good results that may follow. There are in the Treasury many able officials, and, having said that, I feel myself at liberty to voice my strong objection to outside persons who have large commercial interests being called in to confer and advise as to the financial transactions -of the Commonwealth. I am under the impression that a certain amount of influence has in ‘this way been brought to bear on the Trea- sury, and that, in my opinion, is most undesirable. There was a period in the history of Australia when men of dignity and of high ideals were in charge of public affairs, and they would not have tolerated any such outside interference, holding as I do. that all those associated with the administration of our finances should be responsible to Parliament, and paid salaries sufficient to make them independent of all influences sought to be exercised by selfish interests. This innovation was not made by the present Treasurer (Sir Joseph Cook), and would not be permitted by any one who really understands constitutional government. The taxpayers would have much more confidence in the administration of public affairs if such matters were left to those answerable to this House. As to the Bill itself, short-dated Treasury-bills at, say, 6 per cent., are a very useful investment; and we ought not to be placed in the position of having to go to the London market for loans, and I think this course might be avoided for a little while. We are told that much of the financial trouble is caused by the sugar problem, and ever since I entered this House sugar seems to have been at the bottom of every problem of the kind. I suggest that, in view of the anxiety displayed in America to take up our loans, we need not appeal to London.

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

– The point is that, if we wish to keep off the London market, we should not incur liabilities; the one question now is whether we shall pay our debts or repudiate them.

Mr WEST:

– It is quite a pleasure to be in the House when the Treasurer is present. He always reminds me of the boa constrictor, which slobbers its victim all over before “bolting” his meal; and he now seems to be trying to do the boa constrictor act with me. However, this country seems to me like a man on the “bust,” who will borrow a pound from anybody without regard to the future, but as representative men we ought to see that all tendencies to extravagance are severely curbed.

Mr CONSIDINE:
Barrier

.- It seems to me that some honorable members who have spoken this morning, including the honorable member for Illawarra (Mr. Hector Lamond), are deli-‘ nous with delight because the Queensland

Government and that of the late Mr. John Storey, New South Wales, experienced difficulty in raising loans in Great Britain. Other honorable members have displayed an astonishing amount of innocence. They have expressed surprise that the money-lenders, whether operating under the American, British, or any other nominally national flag, have displayed a desire to control the policy of the peoples to whom they lend money.

Mr Gabb:

– That is a very old game.

Mr CONSIDINE:

– I do not know whether the honorable member thinks it is a very old game to pretend to innocence that one does not possess. It appears to me that any individual who examines the international financial position must be struck by the fact that in modern times, at any rate, Governments like those of the Australian States must go almost cap in hand to borrow money. The net result is that, although the Governments nominally govern, the real .governors are the financiers. Why then pretend to an innocence that you do not possess when you find financiers insisting upon having their pound of flesh, and dictating policies to the Governments to which they lend money? The financiers of the United States of America dictate the policy of the South American Republics and the financiers of European nations do the same in regard to Eastern countries. The act of forcing loans upon States has been employed as a first step in facilitating economic exploitation.

Mr Watkins:

– And also economic enslavement.

Mr CONSIDINE:

– Most decidedly. We know that European nations have forced loans on Turkey, China, and other Eastern countries in order that they might get a grip upon the economic resources of those countries and sap their political’ independence. Why be surprised that we, in Australia, find ourselves in the same category? To my mind it is immaterial, when you want a loan, whether you go to the United States of America, to Great Britain, or to Japan.

Mr Wienholt:

– Do you think Australia needs much forcing?

Mr CONSIDINE:

– The honorable member’s conception of Australia and mine are very divergent. The honorable member has in mind the people who own Australia. I am thinking of the people who are exploited in Australia, and are divorced from the sources of wealth. It is immaterial, from the point of view of the working man of this country, whether the Government goes to Hong Kong or to New York for a loan. The interest upon the money will in either case be paid by the workers. Whether we go to New York or to London is only a difference in degree, not a difference in kind. This House knows, and no one knows it better than the honorable member for Moreton (Mr. Wienholt), that the administration of this country to-day is controlled by the financial interests of this country. What is there to complain of if the man who supplies the sinews of war determines the policy? Honorable members opposite are carrying out the instructions of the people whom they represent. The honorable the Treasurer said he deeply regretted that the Queensland Government had gone outside the Empire to float a loan.

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

-i did not say that. I said that I deeply regretted that it had been found necessary to get financial accommodation outside the Empire. I never attempted to criticise in any way the actions of Mr. Theodore’s Government.

Mr CONSIDINE:

– You certainly did deprecate his going outside the Empire to get financial assistance.

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

– I repeat that I simply expressed regret that the necessity had arisen for the Queensland Government to go outside the Empire.

Mr CONSIDINE:

– That is only another way of stating the same thing. Unless there was something to be lost or gained by going outside the British Empire you would not have had any cause for regret. The fact that something, whatever you choose to call it, was lost to the British financier and gained by the American financier, goes to prove the logic of my argument. The Treasurer regrets going to New York because the financial centre of the world has shifted to New York since the war. It is because the American financiers are attempting to gain control of this country, just as the British financiers have tried to gain con trol of other countries and exploit them, that the protest has been raised by honorable members. Nobody suggests that the financier, whether he be British, French, or American, is a philanthropist. We know from British statesmen that the huge economic debt that Great Britain owes to America, as a result of the war, is, in the hands of American business interests, an economic weapon against Great Britain. Knowing that, why should we be surprised that the dominant interests of this country behave like the dominant interests of any other country? It is surprising to me that men who represent the workers should object to it. My regret is that we, who represent the workers, are not in the same position as those who represent financial interests, and as able as they are to utilize the power that is in our hands to forward the interests of our class. Honorable members opposite and I represent different classes of the community. They represent the exploiting interests; I represent the exploited interests. Whereever the loan is raised, the interest to pay for it will be taken out of the surplus wealth provided by the working men and working women of this country. It will not make any difference to them where the interest goes. It will not matter to them whether it goes to London for the redemption of Treasury-bills, or to New York. The only reason why I rose to speak was to try to point out to the people of Australia the point of view that I claim is the correct one for the working classes to take. It is the point of view which shouldbe put forward by those who claim to represent the workers of this country.

Question resolved in the affirmative.

Resolution reported.

Standing Orders suspended, and report adopted.

Ordered -

That Sir Joseph Cook and Mr. Laird Smith do prepare and bring in a Bill to carry out the foregoing resolution.

Bill presented by Sir Joseph Cook, and passed through all its stages without amendment or debate.

page 11988

SUPPLY BILL (No. 3) 1921-22

Assent reported.

page 11989

CUSTOMS TARIFF BILL

In Committee (Consideration of Senate’s requests, resumed from 13th October, vide page 11977) :

Mr GREENE:
Minister for Trade and Customs · RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

.- I move -

That the consideration of requests Nos. 22 to 58 inclusive be postponed until after the consideration of requests 59, 60, 61, and 62.

The Committee yesterday agreed to the Senate’s request to eliminate from item 9 (spirituous preparations) the words “ medicines, toilet preparations,” with the result that spirituous medicines and toilet preparations are not at present dutiable. The Senate has asked, in requests 59 to 62, that those articles be included in items 285 and 290, dealing with medicines and perfumery respectively.

Motion agreed to.

Item 285-

Medicines: . . . (a) Pharmaceutical preparations … ad val., British, 25 per cent.; intermediate, 30 per cent.; general, 35 per cent.

Senate’s Request. - British, 30 per cent; intermediate, 35 per cent.; general, 40 per cent., with an additional duty if spirituous as follows : - If containing not more than 20 per cent. proof spirit, per gallon, British and intermediate, 4s.; general, 5s., and for every additional 20 per cent., or fraction thereof, of proof spirit, per gallon, British and intermediate, 4s.; general, 5s.

Mr GREENE:
Minister for Trade and Customs · RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I move -

That the requested amendment be made, to date on and after 14th October, 1921.

I wish the new duties to date from today, because the request to which we agreed yesterday on item 8 will operate from to-day. This is in order to get over a departmental difficulty in connexion with the collection of the duty. It should be noted that the medicines coining under this item consist, in the greater proportion, of proprietary medicines, imported in a form ready for immediate sale to the consumer. The great bulk of these will be admitted under item 285 (c) at 15 per cent., 20 per cent., and 25 per cent., whether containing spirit or not, as not being similar to medicines produced in the Commonwealth. The same may be said of a number of specific remedies. That is to say, whether they contain spirit or not, so long as they are not similar to other preparations made in Australia they fall automatically under item 285 (c) at the lower rate. I am advised that a great proportion also of medicines compounded by chemists from prescriptions will not be affected by the higher rate under item 285 (a), as the materials would, in large part, be admissible as drugs under item 281 (j), free, or under item 281 (l), which imposes no British preferential Tariff, but an intermediate duty of 10 per cent., and a general Tariff of 15 per cent. As far as can be gathered from official statistics, the proportion of medicines admitted under the lower rate of item 285 (c) would probably exceed two-thirds of the total value of medicines imported, so there is a comparatively small proportion that would fall under this higher item. There is a number of reasons why this alteration is necessary. One is, as I pointed out last night, owing to the operation of the Excise duty on the spirit used, and the duty we were charging on the spirituous medicines imported. The net effect of the operation of the two duties was that we were charging the Australian manufacturer more Excise than we were collecting in duty on the imported article. We have looked into the whole matter very carefully, and, as a result, the Government asked the Senate to agree to the alterations I am now proposing. Another factor, which comes into the situation, is that there is a considerable quantity tff spirit used for the dilution of the ingredients which go into these medicines, but which, in the process of preparation, disappears. The spirit is not in the medicine itself in its final form, but it is used in the preparation of the ingredients employed in compounding the medicines. We charge the Australian manufacturer 42s. per gallon on this particular spirit, and although it has been used in the preparation of medicines both here and abroad, it is not present in the medicine when it reaches Australia, and consequently no duty is charged on it. That is an additional reason why it was found necessary to make this rearrangement in the duties. These facts had not been brought under our notice previously. We had the matter most carefully gone into by the Excise officers, and we found that the representations made to us were correct, and that these amendments were necessary.

Mr Mathews:

– It must he teetotal medicine.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– A great deal of spirit - sometimes up to 60 per cent. - is contained in some of the proprietary medicines.

Mr GREGORY:
Dampier

.- The Minister is entitled, on his statement, to ask for an increased duty, hut he ought to realize that a large quantity of these proprietary medicines would ibe subject to a very heavy impost under the increased duty of 30 per cent., 35 per cent., and 40 per cent., recommended by the Senate. That would mean a heavy tax on the people. Paragraph (c) refers only to medicines and other preparations included in sub-items a and b which are not similar to other preparations made in the Commonwealth. In almost every instance preparations similar to those from other countries are being made in the Commonwealth.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I am advised that paragraph (a) will not apply to over twothirds of the medicines that are imported.

Mr GREGORY:

– That may be so at present. With a heavy duty of this character it would be found that medicines similar to almost every imported article would be manufactured in Australia. I would suggest that the Houseretain the 25 per cent., 30 per cent., and. 35 per cent. passed by it, but approve of the added duty when spirit is contained in the medicine. Many of these preparations are very valuable, and have a ready sale with the public. I do not wish morethan a fair duty to the local manufacturer to be imposed. An increase of 5 per cent. all round in regard to the fixed duty seems tobe going too far.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES · FSU; CP from 1920

– There is one class of preparation, medicinal’ extracts, which is not made in the Commonwealth at all. I have no objection to the duty on patent proprietary medicines,but in many instances medicinal extracts are essential in the compounding of medicines, and it is impossible to produce them in Australia. If they could be excluded it would confer great benefit on the public at large.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I draw the attention of the honorable member to item 281, covering various classes of drugs and chemicals. I think it embraces a very large proportion of the things which the honorable member has in mind.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES · FSU; CP from 1920

– That item has to do with crude drugs. These are scarcely drugs, but are spirituous extracts; and they form the basis of very many prescriptions such as are made by certain well-known manufacturing firms, which practically supply the whole world. They fall under a different category from patent medicines, which are finished products, and are made as well here as anywhere. But these products of which I am speaking must undoubtedly add to the cost of medicines as a whole, because they enter into the preparation of bo many. They would contain more than 20 per cent. of proof spirit. I ask that special consideration be given the matter.

Mr GREENE:
Minister for Trade and Customs · RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I am advised that all those things to which the honorable member has been referring which are not made in Australia, and which would not be dealt with under item 281, come under item 285, sub-itemc. It is only when they are made in Australia that they become subject to the higher duty.

Motion agreed to.

Item 285-

Medicines -

  1. Spirituous, ad val., British, 25 per cent.; intermediate, 30 per cent.; general, 35 per cent. (or according to the rates provided in item 9, whichever rate returns the higher duty).

Senate’s Request. - Terminate sub-item by adding - “up to and including . . . (here insert the date from which the requested alteration insub-item (a) is made to operate) .

Motion (by Mr. Grebne) agreed to -

That the requested amendment be made, with the insertion of the date “ 13th October, 1921.”

Item 285-

Medicines -

  1. Medicines and other preparations included in sub-items (a) and (b), and not being similar to the medicines and other preparations madein the Commonwealth as prescribed by departmental by-laws, ad val. British, 15 per cent. ; intermediate, 20 per cent.; general, 25 per cent. (or when spirituous, according to the rates provided in item 9, whichever rate returns the higher duty).

Senate’s Request. - Omit all words after “25 per cent.”

Motion (by Mr. Gbeene) agreed to -

That the requested amendment be made, to date on and after 14th October, 1921.

Item 290-

  1. Perfumery; perfumed ammonia; toilet preparations (perfumed or not) non-spirituous n.e.i., and spirituous when the duty payable under item 9 is less than that payable under this item; petroleum jelly, n.e.i., ad val., British, 35 per cent.; intermediate, 40 per cent.; general, 45 per cent.

Senate’s Request. - Amend sub-item to read -

  1. (1) Perfumery n.e.i.; petroleum jelly n.e.i., ad. val., British, 35 per cent.; intermediate, 40 per cent.; general, 45 per cent.

    1. Toilet preparations (perfumed or not) n.e.i., ad. val., British, 35 per cent.; intermediate, 40 per cent. ; general, 45 per cent., with an additional duty if spirituous as follows: -

If containing not more than 20 per cent. of proof spirit, per gallon, British, 4s.; intermediate, 4s.; general, 5s. And for every additional 20 per cent. or fraction thereof of proof spirit, per gallon, British, 4s. ; intermediate, ‘ 4s.; general, 5s.

Mr GREENE:
Minister for Trade and Customs · RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

.- I move -

That therequested amendment be made, to date on and after 14th October, 1921.

The effect will be to make the new rates come into operation “ on and after 14th October, 1921.” The intention is similar to that of the Government in regard to perfumed spirits. I need not repeat the reason why a departure has been made from the original proposals, and why the Government are adding the spirit Excise duty. At present toilet preparations containing spirit pay the ad valorem rates respectively of British, 35 per cent., intermediate, 40 per cent., and general, 45 per cent., orthe rates under item 9, which- ever be the higher. The rates under item 9 are based on per proof gallon, respectively, British, 30s., intermediate, 31s., and general, 31s. The Senate’s request proposes to impose a spirit duty based on per proof gallon - British, 20s., intermediate, 20s., and general, 25s., in addition to the ad valorem duty. This additional duty is intended, as in the case of the duty on perfumed spirits, to counterbalance the Excise duty which the local manufacturer has to pay on his spirit. Even now the duties are very much below those which Canada and the United States of America impose on the same class of product. The Canadian rates for bottles or flasks of not more than 4 oz. are, British, 60 per cent., intermediate, 67½ per cent., and general67½ per cent. each; and for bottles of more than 4 oz. each the duty per gallon is 12s. 6d. all round and British, 40 per cent., intermediate, 47½ per cent., and general,47½ per cent. In the United States the duty is, if containing alcohol, 15s. per gallon and 60 per cent.; and, if not containing alcohol, 60 per cent. In Canada, Excise spirit for making perfumery is delivered at 3s. 2d. per proof gallon; in the United States of America it is delivered free for that purpose. Manufacturers in those countries have a great advantage therefore over ourselves with regard to the amount of Excise duty collected there; and, at the same time, the Canadian and United States of America duties are very much higher. In the circumstances, the proposals under consideration are fair, and they practically counterbalance the Excise duties charged in Australia, thus giving the local manufacturer reasonable protection.

Motion agreed to.

Item 110-

Apparel, articles of - (b)Apparel, n.e.i., for the human body . ad val., British, 40 per cent.; intermediate, 50 per cent.; general, 55 per cent.

Senate’s Request. - Insert new item -

Woven undershirts, undervests, underpants, and combinations -

Wool or containing wool, ad val., British, 30 per cent.; intermediate, 40 per cent.; general, 45 per cent.

Cotton, ad val., British, 20 per cent.; intermediate, 25 sent.; general, 35 per cent.

Mr GREENE:
Minister for Trade and Customs · RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

.- I move -

That the requested amendment he made, but modified as follows: -

  1. Knitted undershirts, undervests, un derpants, and combinations, on and after . . . 1921, ad val., British, 30 per cent.; intermediate, 40 per cent.; general, 45 per cent.

I am proposing two alterations in the Senate’s request. One is in respect of the substitution of the word “knitted” for “woven.” And, secondly, I propose to apply only one rate for all knitted goods enumerated in the sub-item; that is to say, the same rate for woollen as for cotton knitted goods. It is often practically impossible to ascertain whether goods coming under review contain wool or are made entirely of cotton. In 1908 Parliament attempted to discriminate between the two, but this oaused so much difficulty that it was abandoned. I believe that the traders themselves are agreed that it is practically impossible to determine definitely without analytical examination whether these articles contain cotton or not.

Mr Gregory:

– Was not the discrimination made in this Tariff when you introduced it?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– No. The goods with which we are now dealing were, in the Tariff when introduced, made dutiable as “Apparel,” under item 110, a,t rates of 40, 45, and 50 per cent. The Senate wishes them to be dealt with separately at rates of 30, 40, and 45 per cent.

Mr Watt:

– Do you propose to accept the Senate’s rates?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– Yes.

Mr Watt:

– Do you not think that that may have a serious effect on the local industry ?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The rates proposed by the Senate are those which apply to knitted socks and stockings for human attire, and in view of the fact that they have given sufficient protection to the local sock and stocking trade, it seems reasonable that they should be sufficient for the protection of the business of making the knitted garments under consideration.

Mr Maxwell:

– Why did the Minister originally propose higher rates for these knitted garments?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– As I have explained, we originally dealt with them as “Apparel “ ; we did not particularize in regard to them. Similarly, corsets were included with apparel, and were subsequently dealt with separately, and made dutiable at lower rates than those originally proposed. I amadvised that the local makers think that they can get through with the rates now agreed upon.

Mr WATT:
Balaclava

– I agree with the Minister that a mistake was probably made in the Senate in using the word “ woven “ instead of the word “ knitted “ in respect of the goods now under consideration. I agree with him, too, that it is wise to apply the same rates to cotton and woollen goods of this class, because of the practical impossibility of discrimination, and also because, if cotton goods were admitted at lower rates than woollen goods, it would put a premium on their use, to the disadvantage of those interested in the consumption of wool. I am afraid, however, that the 10 per cent. reduction of rates to which the honorable gentleman wishes us to agree may strike a serious blow at a rising industry. I am not impressed with the soundness of the suggestion that, because the makers of knitted socks and stockings can get along with these lower rates, we shall be safe in applying them to the class of goods under discussion. It might better be suggested that, as rates 10 per cent. higher are needed for the protection of the apparel industry generally, they are needed for the protection of the business of making these goods. I have no special interest in the matter, but I have watched with pleasure the progress of woollen manufactures in Australia. It has been a reproach to us until now, that we have exported practically all our wool unmanufactured. It should be our ambition to manufacture at least all the woollen fabrics that we require for our own use, and we might also export woollen manufactures. It has been said that Australia rides on the back of the merino, and undoubtedly since the early prosperity produced by the discoveries of gold, we have lived chiefly by the breeding of sheep. Until the war came, it was impossible to do much manufacturing here, but since then our woollen industries have progressed greatly.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I do not think that any others have advanced so rapidly of late years.

Mr WATT:

– The reason is that the war impeded the importation of woollen goods, and thus gave an incentive to enterprising Australians to invest money in businesses for the making of woollen goods. I think it is a mistake, just as we are showing what can be done in this way, for the Minister to reduce the protection on a class of these goods. I understand that over £3,000,000 has been invested in woollen manufactures in Australia, and the Minister, before proposing a reduction of duties, should make sure that this vast capital will not be endangered by the reduction. I do not know what is the attitude of pastoralists towards the woollen industry.

Mr Jowett:

– I am strongly in favour of the higher rates in this case.

Mr WATT:

– Any one who desires the success of the wool business must wish the manufacture of wool to do well in this country. It is surely not economical for us to export all our wool to Great Britain and to import woollens, paying all the costs of freight both ways, and the manipulations and profit charges of the manufacturers abroad.

Silting suspended from 1 to 2.15 p.m.

Mr WATT:

– I do not propose to detain the Committee very much longer, but since the adjournment for lunch I have been looking at some of the figures connected with the knitted undergarment industry. I find that very large sums of money have been invested in it during recent years, and the amount, directly and indirectly, involved is considerably over £3,000,000. It is represented to me that there are twelve or thirteen factories engaged in the industry in New South Wales and Victoria.

Mr Mathews:

– The item covers more than, knitting factories.

Mr WATT:

– I am speaking now especially of knitted undergarment factories. There have arisen substantial vested interests of capital and labour. The workers in the industry are becoming more familiar with the work, and are acquiring a degree of efficiency that is very gratifying to those engaged in it. It is an important and extensive industry, and has been thriving tolerably well under the conditions which gave it an opportunity during the war. I feel that the Minister for Trade and Customs (Mr. Greene) has made a mistake in proposing the acceptance of the duties suggested by the Senate, particularly in connexion with the British preference Tariff. I understand that in 1908, thirteen years ago, the duty against Britain was 35 per cent. The Senate therefore suggests a retrogressive move to the extent of at least 5 per cent., operating against an industry which should be encouraged as much as any other industry in Australia. I have not intervened in the Tariff debate at all before, largely because I was eminently satisfied with the principles embodied in the Tariff introduced with such tact and spirit by the Minister for ‘Trade fend Customs. It ‘ is only because I think that the Senate has been ill-advised in making recommendations likely to be injurious to some important Australian industries that I have felt inclined to express some objection to their proposals. Associated with the knitting industry is the spinning industry. They are intimately and inevitably associated. When the war was on this industry was encouraged by every suggestion from the Government. It contributed very largely to the stability of the woollen manufacturing industry. Until we can spin yarns and can knit or weave them into the complete article required for human wear, our woollen manufactures must be incomplete. The more I consider the matter, the more I arn disposed to regard the woollen industry as a basic industry for Australia. It should take second rank to none in this respect. The iron and steel industry is a very important one. Economic history teaches us that no nation can hope to attain enduring greatness unless it develops an iron and steel industry; but there are other industries, and amongst them particularly the woollen industry, which are as important, as native, and as essential. Unless^ the Minister can furnish the Committee with figures to show that this industry will be sufficiently protected with & 30 per cent, duty in the British preference Tariff, I must conclude that we shallbe in error if we accept the suggestion of the Senate. Perhaps the honorable gentleman would prefer to investigate the matter at a later stage. If so, he might be invited by the Committee to postpone the consideration of this item.

Mr RICHARD FOSTER:
WAKEFIELD, SOUTH AUSTRALIA · ANTI-SOC; LP from 1910; NAT from 1917; LP from 1922; NAT from 1925

– Does the right honorable gentleman not think that present conditions render the duties proposed a sufficient protection to this industry?

Mr WATT:

– No. I think that Bradford manufacturers and others engaged in the woollen manufacturing industry in the Old Country will probably be able to beat us in certain lines of goods unless we lift the duty on this item to a proper level. We cannot expect, for a time, quite the same efficiency from our workers. They cannot learn the business from start to finish in a few months or in a few years. I canremember something of the troubles which we experienced in former days in the establishment of the woollen industry in Victoria. I do not know whether honorable members generally are familiar with the difficulties which then had to be faced; but the honorable member for Kooyong (Sir Robert Best) will recollect them, as, in considering his Tariff of 1895-6 he had to deal with them. At that time we were struggling with the difficulties of blanket making. There were many experiments, some heartbreaking, and a considerable loss of money to workers and those who invested their capital in the industry; but eventually our manufacturers succeeded in extracting the yolk from the wool sufficiently to enable them to manufacture as good a blanket as can be made in any part of the world. This was an instance of the triumph of perseverance; and, despite loss and hardships, we have built up a substantial woollen manufacturing industry in this country. There is no limit to the expansion of the industry now under consideration, except the consuming capacity of the Australian people; and in our variable climate, particularly in the south, we should in every way we can encourage the wearing of garments manufactured in this country from our own wool. This is an industry which lends itself to the employment of a variety of labour’ and talent throughout the country. It should not be confined merely to the cities of Australia*. Its extension might well operate as an industrial decentralization movement. I suggest that if the Minister is not thoroughly convinced that the Senate’s recommendations in respect to this item are safe he might agree to postpone it until honorable members or the officers of the Department have made themselves more familiar with the facts and prospects. Unless the Minister is prepared to alter his present view, I shall take the opportunity at a later stage of moving an amendment to lift the duties on this item to the rates previously fixed by this House.

Mr FENTON:
Maribyrnong

.- I have very much pleasure in indorsing the remarks of the right honorable member for Balaclava (Mr. Watt). With all respect for his accumulated knowledge of Tariff matters, I think that the Minister for Trade and Customs (Mr. Greene) is too much inclined to estimate the future on the experience of the past four or five years. Every one knows that that experience was abnormal, and supplies no stable basis for forecasting the future. During the war the shipping of the world, and particularly British bottoms, were required to such an extent for purposes other than the carriage of goods, that Australia enjoyed a degree of protection for her native industries such as she never experienced before. Having the raw material, wool, at hand, an advance was made in our woollen industries which was very encouraging. We should not recede from the position we have attained. Capital to the extent of between £3,000,000 and £4,000,000 has been invested in our woollen manufacturing industries. We have now arrived at a time when the competition of other countries is likely to be very keen, and there can be no doubt that they will endeavour to unload their products upon Australia. Now is especially the time when increased capital should be put into our mills to provide improved machinery and an increased output to enable us to compete with manufacturers on the other side of the world. If we reduce the duty upon the articles covered by this item to a ratebelow that fixed in 1908, we shall’ not encourage our woollen mill and knitting mill proprietors to invest capital in the improvement of their plants. The Min- ister,in submitting bis motion, spoke in a somewhat halting way, suggesting that he is doubtful about the wisdom of accepting the recommendation of the Senate. He said, “ I think.’’

Mr Watt:

– John Stuart Mill said that that is the weakest way in which to conduct an argument.

Mr FENTON:

– He was a very good authority on the subject. The Minister seemed to be in doubt as to whether he was proposing a sufficient measure of protection for the industry under consideration, and I say that if there is any doubt on the matter the Australian manufacturer and worker should be given the benefit of it. Although I represent a city constituency, I admit that one of the most pleasing features of the expansion of the woollen industry in recent years has been the establishment of knitting and woollen mills in country districts. We know that the fortunes of former mining towns have been considerably revived by the establishment of knitting mills. There is no doubt that the industry will be further extended provided sufficient protection is given to it by the Tariff. Even with the Tariff at present in operation, woollen goods to the value of millions of pounds have been imported. There may have been a falling off in the importations re- cently, but still far too great a quantity of these goods is being imported. One great principle underlying the Tariff, as enunciated by the Minister himself, is that it should serve to make Australia as nearly self-contained as possible. That is a cardinal principle which must be borne in mind in the framing of any Tariff, and we should, in dealing with this, as well as with other items of the Tariff, endeavour to make Australia selfcontained. It may be suggested that an increase in the duties will lead to an increase in local prices; and in this connexion I can give an illustration for which I can vouch from the experience of myown family. Prices were asked of a certain Melbourne house for a particular garment of men’s underwear. The price quoted for the imported article was considered somewhat excessive. Further inquiries were made from manufacturers as well as retailers - I can trust the judgmentof my wife in the matter of quality - and it was found that in the prices quoted for this particular garment of men’s underwear there was a difference of 10s. in favour of the locally manufactured article for goods of the same quality. The duties we previously fixed have been in operation for several years, and, notwithstanding the measure of protection which has been afforded to the industry for so long, Australia has been flooded with these particular goods.

Mr Gregory:

– When we were dealing with the Tariff Board Bill we tried to carry a provision for the protection of the consumer in the matter of prices by enabling manufacturers to supply retail traders directly.

Mr.FENTON. - I am prepared to support any action taken by the Tariff Board to keep local prices within reasonable bounds.

Mr Richard Foster:

– The honorable member says that the country is. flooded with imported woollen goods to-day, but that is not the case.

Mr FENTON:

– The honorable member for Wakefield (Mr. Richard Foster) can obtain the statistics on the subject from the Trade and Customs Department.

Mr RICHARD FOSTER:
WAKEFIELD, SOUTH AUSTRALIA · ANTI-SOC; LP from 1910; NAT from 1917; LP from 1922; NAT from 1925

– I go into the warehouses, where I hear what the warehousemen have to say, and I see their stocks.

Mr FENTON:

– The honorable member must accept official figures on the subject, and if he will consult the Trade and Customs Department he will find that, even in recent years, these goods have been imported to the value of millions of pounds, and they are still coming in. If that has happened under a higher Tariff than the Minister now proposes, what will be the lot of our manufacturers if this request be agreed to?

Mr Watt:

– According to the Customs statistics, our importations of cotton socks alone last year were valued at over £1,250,000.

Mr FENTON:

– That is so. The position taken up by the honorable member for Wakefield is that he is in favour of the establishment and maintenance of industries in Australia provided that they sell their manufactures , at reasonable rates.

Mr Richard Foster:

– That is my position. We want the price of some of these woollens to come down.

Mr FENTON:

– In the case of certain underwear, I found a difference of 10s. per pair in favour of the local as against the imported article, notwithstanding that the local article was quite as good as that from abroad.

Mr Lazzarini:

– Was that during the war period?

Mr FENTON:

– It happened within the last two years. Since 1914 we have had in operation a higher Tariff than that we are now asked to impose, yet it has not fully protected the industry.

Mr Richard Foster:

– It is not needed to-day, but while we have such a Tariff in force local manufacturers will take advantage of it.

Mr FENTON:

– I am afraid that I cannot convince the honorable member. I join in the request made by the honorable member for Balaclava (Mr. Watt). I suggest that the Minister might go so far towards meeting the Senate’s request as to allow the item to stand as originally introduced. If he desires to obtain further information on the point, let the further consideration of the request be postponed. In connexion with another industry, two large importing firms whose joint business in this country is worth to them £2,500,000, and who are determined not to lose it, intend to establish manufactories here. That is one result of the building up of a Protective Tariff. We shall be glad to see other English firms now doing a big business here setting up manufactories in Australia.

Sir Robert Best:

– That is what they are doing as a result of the Tariff.

Mr FENTON:

– Yes, and we have a splendid opportunity to build up new industries in this way. I urge honorable members with Free Trade predilections to give way, and to help us to pass a Tariff which will lead to new industries being established here.

Mr MAXWELL:
Fawkner

.- Owing to my enforced absence from the House while the Tariff schedule was under discussion, I have great difficulty in determining what my attitude should be with regard to some of the requests made by another place. When the schedule was originally before the Committee, the considered judgment of honorable members, who had been led by the Minister (Mr. Greene), with a fully informed mind, was that the duties under this item should be 40 per cent., 50 per cent., and 55 per cent. We have now before us a request from another place that the duties in respect of certain articles included in the item should be reduced to the extent of 10 per cent. No reason for such a reduction has been adduced. I assume that the Committee for good reasons fixed the higher rates, and the opinion of the Minister at the time evidently was that they were fair and necessary for the protection of this very important industry. It appears to me that to ask us to agree to this reduction merely because another place ‘has requested it, without furnishing good reasons, is to ask us to stultify ourselves.

Mr Richard Foster:

– Good reasons for the requested reduction were furnished in another place.

Mr MAXWELL:

– They have not been adduced here; the Minister has given no reason why the reduction should be made. My position is that, being asked to make up my mind as to which of these varying rates of duty should be imposed, I can only say that I have no evidence before me to show that duties of 40 per cent., 50 .per cent., and 55 per cent, are necessary, nor have I any evidence as to whether the industry could be profitably carried on if those duties waves reduced, as proposed, to the extent of 10 per cent. That being so, I have decided that as the considered judgment of this Committee in the first place was that the higher rates should be imposed, and since no sufficient reason for a reduction has been adduced, I must vote for the retention of the higher duties.

Mr LAZZARINI:
Werriwa

– The new sub-item which another place requests us to insert deals with woven undershirts, undervests, underpants, and combinations of wool, or containing wool, or consisting wholly of cotton. I object to the two classes being put together. They are quite distinct. The Minister (Mr. Greene) said that one reason why they should be classified together was that it was difficult to discriminate between goods made of cotton and goods made wholly of wool. That is absurd. Had he said that it is difficult to distinguish between woollen articles and articles made of wool and cotton in different percentages, I should have agreed With him; but it is absurd to suggest that it is difficult to detect the difference between a purely woollen garment and one made wholly of cotton.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I am told by experts in the trade that it is practically impossible to discriminate between some classes of woollen and cotton goods.

Mr LAZZARINI:

– -Under the old Tariff goods containing a mixture of wool and cotton were classed as woollens, and dutiable as such.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– That is so.

Mr LAZZARINI:

– Goods had to consist purely of cotton to come in as cotton.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– There was no discrimination under the old Tariff. We did try to do so, but found that we had to go back.

Mr LAZZARINI:

– I do not know the experts who have advised the Minister; but I have never found any difficulty in distinguishing between a garment made of cotton and wool, and one made wholly of wool, or in discriminating between a woollen garment and a cotton garment. Honorable members would be on sound ground in asking for heavy duties on purely woollen goods, since everything used in their manufacture is produced here. The position is different when we are asked to impose a heavy duty on cotton goods, because we are not producing the raw material in Australia.

Mr Corser:

– We are. There is already a considerable acreage under cotton in Queensland.

Mr LAZZARINI:

– Australian manufacturers of cotton goods or of goods partly of wool and cotton have to import their cotton yarn, so that their industry is not self-contained. The dislocation of shipping as the result of the war or other causes would cut off local manufacturers from their supplies of cotton yarns. I a.m prepared to vote for a protective duty on both classes of goods dealt with in. this item, but until they are able to obtain their raw material inAustralia I am not prepared to give the manufacturers of cotton goods such a high duty as I would give the woollen industry. I do not agree with those who say that cotton garments should not be allowed to come into competition with woollens. There are many parts of Australia where during the summer months garments made wholly of cotton are far more comfortable than woollens. In many inland districts artisans and labourers find it absolutely necessary to wear cotton garments, and I should like the duties on such goods to be lower until we are able to supply the raw material. As soon as we are producing the raw material here, we shall be able to establish the industry on the basis of manufacturing flannelettes, denims, and all other cotton piece goods, but until a local supply of the raw material for the manufacture of such articles can be guaranteed, I shall not be prepared to vote for such a heavy duty on cotton goods as I am ready to support in respect of woollens. I object to being compelled to cast a vote which imposes the same rate of duty on both classes of material. If they were separated we could deal with each class on. its merits.

Sir ROBERT BEST:
Kooyong

– I feel disappointed that the honorable the Minister (Mr. Greene) has seen fit to suggest a compromise on this important item. I concluded, as a> matter of course, that he would ask the Committee to stand by the original duties, which, in the opinion of the large majority of honorable members, were necessary for the effective protection of the industry. It is essentially a war industry. It was realized that the war provided a splendid opportunity for its development, and it is gratifying to know that British manufacturers have of late been giving attention to Australia as a profitable field for their enterprise. We have an unlimited supply of the raw material, and, therefore, there is every prospect, given effective protection, of the industry developing to its fullest extent. The honorable member for Melbourne (Dr. Maloney) referred to the excessively heavy importations of woollen goods. To the best of my recollection, our importations of wearing apparel alone - chiefly woollen clothing - total about £6.000;000 per annum. We should be in a position to manufacture a very great portion of this apparel in Australia. Already thirteen weaving, knitting, and spinning factories have been established, and machinery to the value of £3,000,000 has been laid down, in the hope of being able to capture this valuable trade in the home market. There is room for very great development in this field of industry. Skilled workmen are being importedj and every branch of the industry is receiving close attention at the present time. One honorable member spoke of the excessive profits that had been earned in recent years. Let me tell him that whatever profits were made during the war were on the basis of prices fixed by the Government, and further, let me tell him. that within the last twelve months the local manufacturers of knitted underwear have reduced prices between 25 per cent. and33½ per cent.

Mr McWilliams:

– I should say they would do that.

Sir ROBERT BEST:

– But surely the honorable member concedes that, in view of the cost of production, this is an important movement in the industry.

Mr Richard Foster:

– What has been responsible for the reduction in prices, except the reduced cost of the raw material?

Sir ROBERT BEST:

– Ofcourse, that was a factor. I am merely stating the position. It may be necessary that reasonable control should be exercised over this, and perhaps ‘ some other industries, in order to prevent excessive profits being made at the expense of the consumers; bat anything attempted in that direction should be done with great care. Any undue interference with the ordinary channels of industry and trade might have the effect of checking or stifling enterprise. As I have said, British manufacturers are giving * their attention to the question of establishing the woollen industry in the Commonwealth, and already we have a substantial guarantee as to the future in the fact that thirteen factories are in operation. So far as the manufacture of socks and stockings is concerned, the plant laid down is equal to the production of practically all the requirements of Australia, but, unfortunately, at present it is idle to the extent of about 60 per cent. of its output capacity. The industry is, in a sense, native to the country, because of the enormous supplies of raw material readily available. It is gratifying to know that there has been substantial development during the last three or four years. We should be care ful, therefore, not to discourage local enterprise by a reduction of the duties as proposed, especially in view of the heavy importations that are being made. I urge the Minister to reconsider his decision. The Committee must have an opportunity to vote for the duties previously agreed to, and I hope the Minister will help us in this, matter.

Mr RICHARD FOSTER:
Wakefield

– I sincerely hope that the Minister (Mr. Greene), having done a good thing in moving for the acceptance of the Senate’s requested amendment, will stand by his motion.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I am beginning to think that I was wrong:

Mr Corser:

– And the Minister is not the only one who has changed his views.

Mr RICHARD FOSTER:

– The Minister’s admission and the interjection of the honorable member for Wide Bay (Mr. Corser) are delightfully refreshing, I admit; but I have never changed my views, and, therefore, I have no need to take back, in any material sense, what I have previously said. I have to thank the honorable member for Melbourne (Dr. Maloney) for having turned up the incident as recorded in Hansard, and I should like to remind the Committee that on that occasion my speech was directed against a ridiculously low amendment, which had been submitted by our dear old friend who has since gone. I intimated that I was prepared to accept any reasonable compromise between his amendment and the Minister’s proposal, and closed by saying that the Minister’s proposition was outrageously high. That is my position.

Sir Robert Best:

– But did you not vote for the Minister’s proposition?

Mr RICHARD FOSTER:

– How could I do otherwise in order to defeat the amendment ? But I intimated that if I had an opportunity I was prepared to accept duties higher than those proposed in the amendment. I am prepared to do that now. The people of this country had very few friends in this Parliament, so far as the Tariff is concerned. It is about time that those who have any consideration for the people bestirred themselves, and, even now, endeavoured to secure a reasonable consideration of such Tariff items as the one now before the Committee. No one is -more gratified than I -am at the development of the woollen industry in Australia; but let me remind honorable members that it has had 40 per sent, protection for forty years, and it is about time that the public had’ a lock in. The woollen mills during the war were enabled to wipe ou t practically -every penny of their liabilities.

Mr Watt:

– I do not think that is so in the case of all the factories. Most of their machinery was bought at high prices and has not been amortized yet.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The majority of these factories did not start operations till after the war.

Mr RICHARD FOSTER:

– I was referring not particularly to knitting mills, but to those engaged in woollen manufacture. The knitting business is a comparatively new industry. I have a good deal in common with the honorable member for Werriwa (Mr. Lazzarini) as to the wisdom of separating cotton and woollen goods in the Tariff. There ought to be a big distinction between the two. Cotton goods, which are essential as an article of apparel in some portions of Australia in the summer months, should not be placed in the same category. When I spoke of the vast profits made during the war, I referred particularly to the woollen weaving industry.

Mr Watt:

– It is admitted that the woollen weavers made big profits during the war.

Mr RICHARD FOSTER:

– And does not the honorable member know that most of those firms were able to wipe out every penny of their capital liabilities during the war period t

Mr Watt:

– Rut as the honorable member for Kooyong (Sir Robert Best) has reminded me, the prices were fixed by the Government.

Mr RICHARD FOSTER:

– I am not concerned about that in any way. I know they were controlled. We cannot blame them for that because the Government fixed prices.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– The Senate, in using the word “ woven,” made an error. They intended to use the word “ knitting,” and I am proposing to alter the item accordingly.

Mr RICHARD FOSTER:

– -I was under the impression that the Minister’s proposal mixed cotton goods with woollen goods.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– These goods are -all knitted.

Mr RICHARD FOSTER:

– One of the best features of this extension of the woollen industry is the fact that establishments engaged in manufacturing knitted woollen goods of the description of those included in the item are opening up in country districts.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– No doubt it is an industry that is peculiarly adapted to country districts.

Mr MATHEWS:
Melbourne Ports

.- - If we do not encourage the knitting industry great injury will be done to the yarn-spinning industry. Imported knitted goods are certainly not made up from yarn spun in Australia, but if the goods are manufactured here we have every chance of their being made from Australian-spun yarn’. Spun yarn is the greatest essential in the establishment of our woollen industries. In addition to firms who have invested a large amount of capital in knitting mills, there are throughout Australia quite a number of small establishments which will go to the wall if the increased ‘duty is not maintained. I know that many Australians prefer to wear cotton next to the skin. ‘ It would certainly be barbarous to say to them, “ You shall not do so “ ; but there would be no hardship in saying, “ If you prefer to do so you must pay for the cotton goods what you would have to pay if you bought the Australian article, made of Australian wool.” We have been told by the honorable member ‘for Wide Bay (Mr. ‘Corser) that already there are 15,000 acres of land in Queensland upon which cotton is grown. There is no reason why, within the next three years, because of the encouragement we may give in the shape of protective duties, the cotton industry should not grow to an extent that will enable the local knitting firms to secure all the cotton they require in Australia. By the exercise of care and caution we ought to be able to keep out the pests that destroy the cotton crops in other countries. However, we should not spoil our knitting industry’ on the ground that we are. not already producing sufficient cotton locally. The duties on these goods ought to remain as they were when we .agreed to the item in this Committee, -and therefore I intend to move -

That the requested amendment be not made.

Mr JOWETT:
Grampians

.- In seeking the reasons -which actuated the Senate in submitting this request to reduce the duties upon knitted goods, one naturally turns to the debates that took place there. I find from Hansard that the subject -was introduced at 5.20 a.m. and disposed of at 5.32 a.m. The Duke of Wellington once said that of all kinds of courage the 4 o’clock in the morning courage was the best. If the great Iron Duke had been an Australian legislator during the last few years, I think he might have added to his remarks by saying that the rarest kind of wisdom was the 4 o’clock in the morning wisdom. The matter was not debated even at 4 a.m. in the Senate, but an hour and a half later, and during the twelve minutes it was under consideration two or three alternative requests were submitted by the only senator who seemed to take the slightest interest in the subject. I find that one reason he gave to his fellow senators for submitting his request was the following: -

I was speaking to a gentleman to-day who told me that he had to pay as high as 25s. a pair for woven natural underpants.

The gentleman who gave the senator that information could not have known what he was talking about. He described his purchase as woven goods, whereas, as a matter of fact, the goods were knitted. In any case, they were probably imported, because no manufacturer of similar goods in Australia has ever charged a price approaching that figure.

Mr Richard Foster:

– I would not say that retailers have not charged as high as 25s. for such goods.

Mr JOWETT:

– I would not say what some retailers may have charged, but when the duties on these articles were under consideration in this chamber. I took the trouble to ascertain the prices manufacturers were asking, and I was so impressed with the immensely superior quality of the goods they were producing and their cheapness that I bought several pairs.

Mr Richard Foster:

– They may have supplied^ you .with them at a cut price for advertising purposes.

Mr JOWETT:

– They assured me that they charged exactly the same price to any other person. I had no intention of taking advantage of any inducement they might offer to me in order to secure my custom, but the price of these goods, for which the gentleman quoted by the senator says he paid 25s., was lis. 2d., and they were made from the best Victorian Western District merino wool. I saw the wool and the tops and the yarn from which the goods were knitted. The gentleman who says he paid 25s. must have gone to a most extortionate retailer or purchased imported goods. I mention these facts in order to demonstrate the inadequate information upon which the Senate has submitted this request, and to show that we have absolutely no justification for acceding to the request. If we do indorse it, we shall be imposing duties upon these goods which will not only be below those which have been in operation since the Tariff was introduced, but below the rates in the 1914 Tariff, and even that of 1908. We are now asked by the Minister for Trade and Customs (Mr. Greene), who, perhaps, has not given his final verdict, to impose a British preferential duty of 30 per cent., and an intermediate duty of 40 per cent., although in the 1908 Tariff the rates were 35 per cent, ‘and 40 per cent, respectively. Before such a proposal is adopted the Minister should give some valid reasons for its acceptance. Until now these knitted hosiery goods have always been under, the item “Apparel.” But it is now proposed to remove them from the item “Apparel,” and to put them under a separate subitem. This is in order that these knitted goods should be admitted at a lower rate of duty than other apparel. No one has been able to show why knitted goods should now bear a lower duty than they have been subject to for the last twelve years, or a lower rate of duty than ia imposed on other forms of apparel.- The fact that these articles are proposed to be placed under a separate item does not alter the articles themselves, because they are still made-up apparel; and if other articles are entitled to higher rates, these goods should be also. There are two strong reasons why we should adhere to our previous decision. One is that large quantities of these knitted goods are manufactured from the raw material which we produce in Australia, mainly wool, and the other is that knitted goods are produced in industries which can be established in country districts perhaps better than any other. Iu fact, knitting factories have been established in many country centres, and others are in course of construction. An enormous amount of capital has been invested in this industry.

Mr Prowse:

– How much?

Mr JOWETT:

– Considerably over £3,000,000; but I regret that, up to the present, the bulk of it has been invested in city industries. There is, however, every prospect of additional factories being established in country centres.

Mr Considine:

– Is the honorable member interested in these ventures?

Mr JOWETT:

– Yes, I am; and I do not think the honorable member for Barrier (Mr. Considine) would reproach me for having given some financial assistance in connexion with their establishment in country towns. As the Minister has not been able to give sufficient reasons why the Senate submitted this request, the discussion should be adjourned until next week. Is the Minister prepared to report progress at this stage?

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– I would like to hear the views of one or two other honorable members before doing so.

Mr FRANCIS:
Henty

– I was particularly struck with the able manner in which the Minister for Trade and Customs (Mr. Greene) dealt with this item when it was last before the Committee, and with the reasons put forward in support of this very importantindustry. I watched the progress of this and other items through another place, and am shocked to realize that a suggestion has been made to reduce the duties on imported articles. If the request is adopted, the industry will be placed at a great disadvantage, and we shall be in a position similar to that which we occupied when ‘ we were depending on foreigners for our supplies. Although we produce large quantities of wool, it was customary for many years to export it to foreign countries, where it was made up into the finished article, and returned to Australia for the use of local consumers. I believe the «Minister now realizes that it is necessary to give the matter further consideration, and that it is desirable that the factories already established shall progress, and that others may be erected. Unless we are very careful in this matter, we shall be placed in- a de plorable position. It would be better for the Australian consumers to pay slightly more for locally-manufactured goods than for Commonwealth and State Governments to be asked to dole out sustenance to the unemployed, as has been clone on. several occasions. The Senate’s request provides an increase in the general Tariff of only 5 per cent, over the 1908 rate. During the past fifteen years - quite apart from the tragedy of the wai- - we have been faced with numerous difficulties and continual industrial unrest. Thousands of men left Australia in the cause of liberty, 60,000 of whom will never return; and, notwithstanding this, and the extent to which production has been hampered, the Commonwealth has made remarkable progress. Although over £3,000,000 has been invested in this industry, it is suggested that there should ,be an increase in the general Tariff of only 5 per cent, over that fixed in 1908, and a decrease of 5 per cent, in the British rate. If the people concerned in this industry appeal to the Tender Boards for any preference, they will be told that they have their preference in the Tariff, although the duties, if imposed as requested by the Senate, will mean the loss of practically all the money “that has been invested. It is an industry eminently’ calculated to afford employment to large numbers of immigrants we expect in this country; and it is certain that if employment is not provided for the new arrivals the hundreds of thousands of pounds involved in our immigration policy might as well be thrown to the bottom of the sea. More particularly does this industry afford opportunities in the country districts ; and we know that a ground of just complaint is the aggregation of people in the cities. Now is presented to this Parliament an opportunity, such as will not present itself again for some considerable time to come, to extend the ‘industrial field of Australia. I could if necessary adduce further evidence in support of the original decision of this Committee. It is only a waste of time for us to spend the better part of the session in considering the Tariff, with the best possible information at our disposal, if the result of our labours is to be nullified in this way. That information was afforded to us by ‘the Minister, and by that most experienced official, Major Oakley, the head of the Department. It is well known that large spinning plants have been installed for spinning yarn, and the development of the industry is proceeding most satisfactorily, thereby causing the increased use of Australian wool, of which our friends the Country party are the producers. As I have said, the acceptance of the Senate’s request will not only seriously impede the progress which is now so evident, but will destroy the utility of the capital that has been invested. I know that my friends opposite, including the honorable member for Melbourne Ports (Mr. Mathews) desire to see the protection extended by this Chamber continued, if only because it affects their constituencies more, perhaps, than it does my own. There is not one mill in my constituency.

Mr Mathews:

– I have all the workers, and you have all the millionaires !

Mr FRANCIS:

– I am speaking now not only on behalf of the “ millionaires,” but on behalf of the great masses of the people of Australia. In my opinion,, the Minister has made out a good case. I visited the Senate when the Tariff was under consideration, and I can say that this particular item was discussed with half-a-dozen tired senators in the Chamber in the early hours of the morning,

The TEMPORARY CHAIRMAN (Mr Atkinson:
WILMOT, TASMANIA

– I must ask the honorable member to refrain, as far as possible, from referring to another place.

Mr FRANCIS:

– All I ask is that protection shall be afforded to this, as well as to other industries, some of which enjoy much higher duties. This is the great natural industry of Australia, and is deserving of the best assistance that can be given to it. I hope honorable members will adhere to the Tariff as it left this Committee.

The TEMPORARY CHAIRMAN:

– The honorable member for Melbourne Ports (Mr. Mathews) desires to move that the Senate’s amendment be not made. I am afraid that I cannot accept that amendment at this stage, the Minister having already moved a modification. The course for the honorable member for Melbourne Ports to adopt is to vote: against that modification, and, if it be not carried, then submit his amendment.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

. -If the Minister (Mr. Greene) does what I believe the Committee desires, he, will support the rejection of the request of the Senate. The Government owe a duty to those people who have invested their money in knitting mills throughout the country, and the Minister ought to keep faith with them. It is now about eighteen months since this Tariff was first tabled, and in that time considerable sums of money have been so invested on definite promises that the Customs Tariff would be fixed at a certain rate. If now the people who have invested money are told that the duty is to be reduced, it will amount to a breach of faith, such as should not be permitted by the Committee. In my own electorate, arrangements have been made for the establishment of knitting mills, and the one question that was asked me was what protection would be afforded. In reply; I quoted the Tariff schedule, andthis appeared to be highly satisfactory from the point of view of those concerned. This matter affects not only one portion of Australia, but: the whole Commonwealth. The industry will have to struggle on under lower rates of duty if the Senate’s request be accepted; but I think that the good sense of honorable members here will prevent them from being influenced by a decision; arrived at by the Senate after about half-an-hour’s consideration.

Mr Lister:

– After about twelve minutes’ consideration at half-past 5 in the morning.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– That only makes it more unlikely that the decision, of the Senate wiE influence honorable, members here who agreed to the Tariff as it left this Chamber after mature consideration. The figures connected with this industry leave no possible escape from the logic of facts. Our importations amount to about £98,000,000 a year, of which £26,500,000 represents apparel and textiles. That is a most extraordinary position for a country which produces the raw material, and the best raw material in the world. In the teeth of that, we are importing £26,000,000 worth of the textiles that we use in this country: That is. a. reflection on the intelligence of the people. Only 4 per cent. of the wool produced in Australiais turned into manufactured articles here, and we manufacture only 15 per cent, of our requirements of textiles and apparel. These figures should be a sufficient argument against , proceeding any further along these lines. Many people in this country have invested money in woollen and knitting mills during the past eighteen months, on the distinct understanding that additional duties would be imposed. It would be almost a breach of faith to tell them that they cannot have those additional duties.

Mr Wienholt:

– They must have known that the duties were liable to be altered.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– No indication of that was given to them when they invested their money. There was no suggestion of it when the Minister made a speech on this item before the Bill went to another place. I do not know what the Minister’s reasons are for proposing to agree to the Senate’s request. I have looked in vain for any argument that might have been used in the Senate in favour of the reduction. No arguments that were used there could have influenced the Minister.

Sir Robert Best:

– No arguments were used there.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– That is certainly so. Why has the Minister departed from the very excellent case he made out when the item was last before the Committee? I agree with the honorable member who has just resumed his seat regarding the need for rural development. Many people speak with their tongues in their cheeks of the necessity for decentralization. If there is one thing more than another that will encourage people to go into the country, and will keep them there, it is the building up of industries in country districts.

Mr GREENE:
RICHMOND, NEW SOUTH WALES · LP; NAT from 1917

– There is no question but that this industry is peculiarly adapted to the country.

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– There is no doubt about the truth of that assertion. There was nothing extraordinary about the duties that this Committee agreed to before the Bill went to another place. Nothing has been said or done in the meantime to justify any one in running away from that decision. Ihope the Minister is not going to bow to the opinions of the other place. If the members of the Senate had any opinions, they did not express them. ‘ In Australia we have the raw material and everything necessary for making use of it.

Mr Wienholt:

– Then why do you need a high duty?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The honorable member will agree with me when I say that, having all the other essentials to the prosperity of the woollen industry, it would be a pity not to seize the other factor that is within our reach. Why should we deny any facility being given to ah industry if it will assist . in building up that industry? I have figures showing the amount of raw material we sent to France in pre-war days. France worked this raw material into manufactured articles,which she sent back to this country, and also exported to Japan and other countries. Japan and other Eastern countries ought to be customers of Australia, and not of France. It is unfair, by sending Australian raw materials to other countries, to enable those countries to supply the markets that, should belong to Australia.

Mr.GREENE (Richmond- Minister for Trade and Customs) [3.52]. - So that I may have another opportunity of looking at this request from the Senate in the light of the representations that have been made, I agree that progress be reported.

Progress reported.

page 12003

ADJOURNMENT

Order of Business - Estimatesof Expenditure

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

– I move -

That the House do now adjourn.

Mr CHARLTON:
Hunter

.- Before the House adjourns, I would like to know from the Acting Prime Minister whether he will continue the Budget discussion next week, in accordance with the arrangements made last week?

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

– Yes.

Dr EARLE PAGE:
COWPER, NEW SOUTH WALES · FSU; CP from 1920

,- I wish to withdraw my notice of motion for the reduction of the Estimates of Expenditure, as arrangements have been made to proceed with the motion standing in my name in another form on Wednesday, 19th October.

Question resolved in the affirmative.

House adjourned at 3.59 p.m.

Cite as: Australia, House of Representatives, Debates, 14 October 1921, viewed 22 October 2017, <http://historichansard.net/hofreps/1921/19211014_reps_8_97/>.