10th Parliament · 1st Session
Mr. SPEAKER (Hon. Sir littleton Groom) took the chair at 11 a.m., and read prayers.
– I have received a letter from the secretary to the Australian Council of Trade Unions asking that the Commonwealth Government should put iii hand at once as much public work as possible in order to minimize unemployment. Will the. Prime Minister take immediate action in that direction?
– Of course the Commonwealth Government will do anything it can to relieve the unemployment trouble by carrying out works for which approval has already been given by Parliament. But I remind the honorable member of the trend of the discussion on the Budget, and the attacks made on the Government in regard to the expenditure of money. I remind him also of the statement I made during the last few days with reference to the difficult position that has arisen in connexion with loan expenditure. That position will be discussed by the Loan Council, on Saturday. In the meantime all I can say to him is that, so far as moneys are available, the Government will do everything in its power to prevent unnecessary unemployment by carrying out necessary works.
– A few days ago I asked the Minister for Works and Railways to supply me with the price charged in Australia for rails during a certain number of years. As this information is needed to enable us to deal with the proposed iron and steel duties, I should like to know if it is now available.
– I am trying to get the information for the honorable member, and shall supply it at the earliest possible moment.
– I should like to know if the Postmaster-General is aware of the dislocation to the mail service to northwestern Tasmania owing to a slight mishap to the s.s. Oonah. Has not the mail contractor a vessel in reserve which could replace the. 00nah and does the mail contract not provide for the imposition of penalties on the contractor if he fails to maintain a continuous service?
– I understand that the Oonah met with a slight accident, but that she is now in commission again. I am not aware at the moment if under the mail contract penalties can be imposed on the contractor, but I shall endeavour to find out whether that is the case, and lel the honorable member know as early as possible.
– In regard to a letter I have received from the Postal Union, I should like to know if it is a fact that although the postal estimates have been passed by Parliament, the Postmaster-General contemplates the dismissal of a large number of temporary employees, chiefly engaged in telephonic and telegraphic line construction?
– The Prime Minister has just stated that the.re has been no curtailment of construction where money is available for the purpose.
– Can the Minister for Trade and Customs tell me if the report of the Tariff Board on coffee is yet available?
– It has not yet arrived from Melbourne.
– Will the Postmaster-General say whether anything can be done to comply with a fairly general request by the members of volunteer bush fire brigades for free telephone service when they are endeavouring to get in touch with their organizations?
– It is not possible to give free use of telephones to the members of fire brigades as the service might be abused ; but all country post offices are advised to supply information free of cost regarding bush fires, so that assistance may be obtained as soon as possible.
– Now that the Housing Bill has reached its final stage can the Treasurer say when money will be available for home builders?
– I remind the honorable member that the Commonwealth Bank Savings Bank Bill has not yet passed both Houses.
– Will the PostmasterGeneral say what progress has been made in connexion with the establishment of rural automatic telephone exchanges, and whether a general installation of these machines is contemplated in the near future ?
– Four of the exchanges are now working very successfully, and- we hope to put many more into operation on the return of our engineer, who is now carrying out further investigations into the system, in America and Great Britain.
asked the Minister for Trade and Customs, upon notice -
– The information is being obtained.
asked the Treasurer, upon notice -
– The information is not available in the Treasury, but the honorable member’s question will be brought under the notice of the Bank.
Expenditure by Commission.
asked the Minister for
Home and Territories, upon notice -
– The replies to the honorable member’s questions are as follow: -
asked the Minister for Trade and Customs, upon notice -
– The information is being obtained.
curt ailment ofconstruction : Dismissals.
asked the PostmasterGeneral, upon notice -
– I am making inquiries into the matter and will furnish - the honorable member with a reply as soon as possible.
asked the Minister for Markets and. Migration, upon notice -
– The replies to the honorable member’s questions are as follow : -
asked the Minister representing the Minister for Defence, upon notice -
When does the Government contemplate the inauguration of regular aerial communication between Derby and Wyndham, Western Australia, as promised in the Treasurer’s budget speech of the 28th September last?
– As it is essential to carry out certain work in connexion with the preparation of landing grounds, &c, before the service can be established, and climatic conditions make it difficult to commence such work for some little time, it cannot be stated at present when the service will be inaugurated.
asked the Minister for Works and Railways, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Minister for Trade and Customs, upon notice -
Whether he has yet obtained the information asked for on notice, on 23rd November, and again on the 6th instant, in respect of the following matter: - For the year ended 30th June, 1927, the value of -
Taxable imports from the United Kingdom, and the total amount of customs duties paid thereon;
Taxable imports from British dominions, and the total amount of customs duties paid thereon ;
Taxable imports from foreign countries, and the total amount of customs duties paid thereon;
Imported articles of a kind not manufactured in Australia - (i) British; (ii) foreign; and the amount of duty collected thereon?
– The preparation of this information is in the hands of the Commonwealth Statistician, as stated in my reply to the honorable member on the 6th instant. The information required is for the year ended 30th June last, and it is understood that the general figures on which this return will be based are being completed by the statistician with all possible despatch.
– Yesterday the honorable member for Kalgoorlie (Mr. A. Green) asked the following questions : -
I am now in a position to furnish the following reply: -
The following paper was presented:-
Seat of Government (Administration) Act - Third Annual Report of the Federal Capital Commission, for the period ended 30th June, 1927.
Ordered to be printed.
Debate resumed from 12th December (vide page 2974), on motion by Mr.
That the bill be now read a second time.
.- The delay in submitting this bill is a matter of surprise to me. Although the agreement contained in the schedule was signed on the 7 th April last, the measure was not introduced until yesterday, aud I understand the Government wishes it to go through to-day. Naturally I have not had time to consider it properly, but I have no desire to block it, because the agreement has already been ratified by the Victorian Legislature, and, as it has been signed by the Commonwealth Government, opposition to certain phases of it would be futile as well as impracticable. At the same time I think the Minister should explain why an agreement signed on the 7th April and proposing many important departures from the ordinary war service homes policy, is brought down for confirmation during the closing days of the session, and passed through Parliament without members having an adequate opportunity to grasp its implications. The Minister’s speech lasted only about three minutes and gave very little information. The bill appears to involve a drastic alteration in the policy of building war service homes in Victoria and I am curious to know whether this is the beginning of the end of house construction in that State by the Commonwealth authority. Hitherto the Victorian State Savings Bank has acted as agent for the War Service Homes Commission, but under this bill it will become the principal. In other words, the entire control of the homes built through the agency of the Victorian State Savings Bank since 1922 will be handed over to that institution. The War Service Homes Commission will be relieved of all responsibility for the administration of those homes, and the occupants will be subject to such terms and conditions as the bank may decide to impose. The need for so radical an innovation should be more adequately explained by the Minister. So far as the construction of homes in Victoria is concerned the future” responsibility of the. Commonwealth will be limited to the provision of funds- to enable the bank to make loans to persons eligible under the War Service Homes Act, and to pay to the bank certain remuneration for so doing. Paragraph (a) of clause 5 provides -
All the estate, right, title and interest of the commissioners in and to the property specified in the notification shall by course of this act be transferred to, and be vested in, the bank.
The 3,483 homes already built or in course of construction in Victoria will be transferred to the Savings Bank, and the 3,266 homes built by the War Service Homes Commission will continue to be administered by that body. Thus there will be two authorities controlling war service homes in Victoria.
– That is practically the position now.
– There is a difference. I have not had an opportunity to peruse the original agreement with the bank, but I gather from the bill and the Minister’s explanatory speech that 3,483 homes will be surrendered to the bank, which will become the principal in regard to them and not merely an agent. At present the War Service’ Homes Commission is the principal’ and carries the whole responsibility to the occupants of the homes. In future the Savings Bank will be the controlling authority.
– A very efficient authority.
– It may be; but I would like an explanation of the need for this dual control and why the construction and administration of war service homes is less efficient in Victoria than in New South Wales and Queensland. The, agreement provides that the Commonwealth shall pay to the Victorian Savings Bank 13s. per cent, upon moneys advanced to the bank and expended by it. The conditions upon which the money is to be made available to the bank appear favorable, and all the bank will be required to do will be to repay the total of the funds advanced as they are repaid by the applicants, and to be liable for the amount outstanding at the end of twenty years. The Minister for Works and Railways, in reply to a question I asked on the 28th October, said that the cost of administration in Victoria through the State Savings Bank was - 15s. per cent, calculated on expenditure in the provision of homes, and, after provision of homes,15s. per cent, on the loans owing by applicants, less arrears and purchase money owing under contracts of sale which had been transferred.
I am pleased to know that under the agreement the administrative cost has been reduced to 13s., but it appears that in the past the Commonwealth has been paying to the Victorian Savings Bank an exorbitant price. In Western Australia the administrative cost is 15s. per cent., but in South Australia, where also the scheme is operated through the State Savings Bank, the cost is only 10s. per cent. What is the explanation of this remarkable disparity? In Tasmania, through the Agricultural Bank, the cost is 15s. per cent., but in New South Wales and Queensland, where the work is done by the commission, the costs are only 11s. 4½d. and11s.1d. per cent, respectively.
– The War Service Homes Commission is building the homes in New South Wales. That may account for the difference.
– The cost-of administration by the commission in New South Wales and Queensland is considerably less than under the agreement with the various State authorities except in South Australia. Why should it be necessary to pay 13s. per cent, to the Victorian Savings Bank when the cost under the direct administration of the commission in New South Wales and Queensland is nearly 2s. less? Why is it impracticable for the commission to build and administer homes in Victoria when its branches in New South Wales and Queensland are doing the work with signal success? We have not been told the estimated annual cost of administration in Victoria under this agreement, but obviously it will be considerably greater than it is in New South Wales and Queensland. I have had a good deal to do with War Service Homes. Many mistakes were made and many scandals occurred in New South Wales, Queensland, and other States, of which the honorable member for Wannon (Mr. Rodgers) and the honorable member for Wimmera (Mr. Stewart) have bitter recollections-
– I have no bitter recollections of any part of my administration. I am prepared to defend it at any time.
– The honorable member for Wimmera made somewhat caustic comments upon the administration of the war service homes by the honorable member for Wannon when Minister for Works and Railways, but I do not, propose to deal with that now. I have been a bitter critic of war service homes administration, but I say frankly of the New South Wales branch that, although building costs are slightly higher there than in other States because of factors over which the commission has no control, the homes are now particularly well constructed and are provided to applicants at cheap rates, while the administration cost is very much lower than in Victoria. There is something wrong with the central administration of the commission if houses can be constructed efficiently and economically in two States and not in others. Perhaps the Minister will explain the’ reasons for this.
When the Housing Bill was in committee I moved an amendment to increase the advance to war service homes applicants ro the maximum of £1,800 fixed :by that. bill. Several honorable members on the Government side of the chamber objected to the amendment on the ground that any alteration of the conditions applying to soldier applicants should be done by an amendment of the War Service Homes Act. Among those who took that view was the honorable member for Herbert (Dr. Nott). This bill affords -an opportunity to the* House to consider whether the present maximum advance of £800 is adequate. The agreement provides that the Minister may specially :authorize advances in excess of that amount, but the additional concession will only be obtainable in special circumstances. When considering the Housing Bill, honorable members virtually agreed that £800 for soldier appplicants was inadequate. I suggest that the agreement should be amended to provide for a maximum advance of at least £950, which is the amount that is generally given by administrative act of the commission.
– The increased amount will be available under this agreement.
– That is satisfactory, although I think the agreement should have set out clearly that the maximum has been increased to £950. Even that amount is insufficient in view of the fact that the Housing Bill provides that non-soldier applicants may obtain advances up to £1,800. I invite the Minister to tell the House whether the Government intends at a later stage to propose an amendment of the War Service Homes Act to provide for an increased advance. The Returned Soldiers’ League of which the honorable member for Richmond (Mr. R. Green) who opposed my amendment to the Housing Bill, is an executive officer, has asked that the maximum advance under the War Service Homes Act shall be the same as that under the Housing Bill.
– The League has asked for an amendment of the War Service Homes Act in order to enable the maximum advance to be increased.
– I invite the honorable member to assist me in getting such an amendment inserted in this bill. He will agree that £950 is not adequate to supply the housing requirements of a returned soldier with a large family. The average digger has from three to six children, and to restrict him to a threeroomed cottage is not in the best interests of the family or the nation.
Seeing that the Commonwealth is surrendering the administration and control of war service homes construction in Victria, there should be a big reduction in the administration costs of the Commission in that State. In this connexion, I des’ire to draw attention to the, large sum expended annually in salaries for the big staff connected with the central administration of war service homes. I should like the Minister to say whether, as a result of this bill, there will be any reduction of those costs. The salaries of the secretary and other principal officers of the central administration have been increased by a larger margin than have the salaries of the controlling officers in New South Wales and Queensland, who have a greater measure of direct responsibility. More consideration should have been given to those clauses of the bill w.hich represent a departure from previous practice in connexion with providing homes for returned soldiers. The Minister should have given a fuller explanation of the agreement and of the general administration of war service homes than he did in his second-reading speech.
.- I welcome this measure as a belated attempt on the part of the Commonwealth to hand over to the States not only the construction of homes for soldiers, but also other matters in connexion with war service homes in Victoria. The continuance of two separate bodies - the War Service Homes Commission to deal with homes constructed by the Commission, and the Government of Victoria to deal with homes constructed subsequently - cannot be justified. Economical administration means dispensing with all duplication and overlapping. I welcome a thorough inquiry into my administration of war service homes, because I believe that the value of the work then done is not sufficiently well known. I do not wish to repeat the whole story of war service homes, except to pay my tribute to the originator of the scheme - the late Senator E. D. Millen - for his magnificent conception of the way in which Australia’s debt to the men who defended their country so well should be discharged. He believed that every soldier was entitled not only to obtain a home in this country at cost price, both as regards land and building,, but also that lie should obtain it on the most favourable terms possible. That was the principle underlying the war service homes scheme. I believe that the late. Senator E. D. Millen went prematurely to his grave because of the work and worry associated with war service homes administration and the misrepresentation and the bitter attacks made against him and the scheme from time to time. With some of his views I have always disagreed. My administration of the war service homes was called into question in this Parliament at a time when I was unable to defend myself on the floor of the House. On returning to my home one evening after a heavy day’s work, I read a statement that had been made. It was then about 9 o’clock at night: I decided to take the matter up immediately, and therefore joined the train for Melbourne at 2.45 o’clock the next morning, and at 10 o’clock I was in Melbourne. I asked the Government to appoint a royal commission to investigate my administration of war service homes, but my request was not granted. I desire to say now that I welcome the fullest inquiry into any phase of my administration of war service homes. The work of re-construction was carried out during the period Of my administration. I have never believed that the Commonwealth itself should assume the role of master builder. I have always felt that the existing organizations in the States, by reason of their experience, were better fitted for the work than any new central organization could be; Senator E. D. Millen accepted the advice of his commissioner that costs and conditions in the building trade at that time made it imperative for a central organization to undertake the building of homes for soldiers. During his absence from Australia, I Avas in charge of war service homes, and on his return I was able to persuade him and the Government that it was better for the work to be carried out on the contract system than by the War Service Homes Commission. I advocated that the States should become the agents of the Commonwealth to carry out the work. With the exception of New South Wales and Queensland, in which States the work of building continued to be carried out by the Commission, I was successful in arranging for the States to do the work. At that time I was confronted with large numbers of contracts for supplies of various kinds which had been entered into by the. commission. Honorable members can have no conception of the chaos that existed at that time. I do not want to hold a post mortem now - this is not the time to find fault with the commission - nor do I desire to reflect on the Minister of that day. After all,
Parliament was responsible for the. appointment of the commission. But should it become necessary, I am prepared to place on record the facts connected with my administration of war service homes from the time I took over the work until I relinquished it. I challenge any honorable member to prove that I entered into any contract for the acquisition or the purchase of any material in connexion with war service homes. The contracts with which I dealt had all been entered into before I assumed control. Some of them I terminated on the most favorable terms possible; others I adjusted. I called to my aid three skilful men in the persons of General McCay, Mr. Stewart, a master builder of Sydney, and Colonel Evans, who was in charge of the finances of the A.I.F. I told them that I desired that the Commonwealth should no longer act as a master builder; that, instead, we should revert as far as possible to the contract system, and I asked them to probe matters to the bottom. Honorable members have no idea of the conditions under which I worked as Minister in charge of war service homes. Conditions were so chaotic that I devoted days and nights to an attempt to obtain order. I claim that the work performed by that board of three men, and the re-construction which then took place, have saved Australia many hundreds of thousands of pounds. I repeat that I welcome the fullest investigation into my administration of war service homes. I also welcome this measure; but I think that the Government should have taken a wider view of the matter. The Commonwealth should no longer engage in building activities. The building of homes is notthe function of any Government. The Commonwealth should content itself with providing the funds for the erection of homes, and leave to the States me task of seeing that the homes are erected in the way that their experience has proved to be best.
– We shall have to pay nearly 2s. per cent, more in Victoria than in New South Wales.
– I cannot imagine that the Commonwealth organization could handle the work more economically than the States are doing it.
– The administration by the. federal department costs11s. 7d. per cent, in New South Wales, and11s.1d. per cent, in Queensland. In Victoria, under this agreement, it will cost13s. per cent.
– A State . department should be better equipped for this work than a central authority.
– The less Nationalist members talk about war service homes the better it will be for them.
– I am prepared for any criticism of the past work of the department. If the Government desires to economize, and prevent the overlapping of authority, let it wind up the administration so far as the Commonwealth is concerned. Let it carry out its obligations to the returned soldiers to the last man; but, having done that, let the busiuess organization be wound up, and then we reach the final chapter of this history.
.- I do not desire the honorable member for Wannon (Mr. Rodgers) to think that I cast on him all the blame that must be borne by Nationalist governments for the bungling that has taken place in the administration of war service homes. The honorable member became the. Minister in charge of that work at an unfortunate period, when the department was in a state of chaos. Hundreds of thousands, if not millions, of pounds had been squandered by those responsible for the erection of soldiers’ homes. The honorable member now wishes the Government to dissociate itself from further building operations; but the honorable member for Reid (Mr. Coleman) has made it clear that in certain States better work is being done by the Commonwealth than by the State departments, and money is being saved. So long as the homes can be built more cheaply under Commonwealth administration we should continue to carry on the work. Shortly after the war, the Government, in its desire to do the best it could for the returned soldiers, was prepared to appoint to positions of control any general or colonel, irrespective of his possession or lack of business capacity. If a man returned from the war with a rank above that of captain, he was considered fit to be given a responsible position in the War Service Homes Department. Now that a gigantic loss lias been sustained, Nationalists have the impudence to point to the failure of federal enterprise. The failure is due to the fact that Nationalist governments took no cognizance of the ability of the officers to fill the high positions to which they were appointed. Competent men with experience of building could have been found among the rank and file of the. returned soldiers, but they were not chosen. Those who had a social “ pull “ obtained preferment. No matter how capable an ordinary soldier might be, he had no chance of receiving a good position in the department. I am surprised that any member of the Nationalist party, particularly the honorable member for Wannon, should bring this matter forward, in view of the squandering of public money for which that party has been responsible in connexion with war service homes. 1 hope that the Minister will not permit his department to cease all building activities. It now employs good and competent men who have had considerable experience of this work.
.- I consider it encumbent upon me to offer one oi’ two observations on thi3 subject. The history of war service homes in Australia has been most chequered, and the experience has left its lessons. A good deal of criticism has been levelled at the early administration; but I do not intend to say anything along those lines, or cast one stone at any previous Minister or officer. No doubt mistakes have been made. I was one of the strongest critics of the bungling of this matter before I became a. responsible Minister. If my criticism was too severe, it was due to the fact that from the outside I did not fully realize the great problems that the administration had to face. If I am asked at this stage to put my finger on the one cause from which arose the greater number of the unfortunate events that occurred, I should say that it was due to the seductive cry - “ Give us business methods. Let us get away from red tape. We want business men, so that we may build houses in a business-like way, instead of having the wasteful expenditure that invariably results from red-tape methods.” It was this attempt to take a short cut to business methods that was largely responsible for the bungling. Tt is curious that, in the cleaning-up process, we had to return to the much-despised red-tape Government official. I take this opportunity of paying my tribute to the work of the late commissioner (Colonel Semmens) and the present secretary of the department (Mr. Petersen). While those two officers are open to criticism in some respects - I do not intend to stand sponsor for all their administrative acts - they are, in the main, deserving of a good deal of credit for the cleaning up that subsequently took place. The trouble was that big prices had to be paid for building material, and at times it was almost impossible to obtain it at any cost. This led the department into accepting the most alluring looking contracts, which subsequently proved to be totally bad. Apart from the shortage of material, there was a scarcity of houses on account of the demobilization of the troops. Is a timelimit fixed to the operation of this agreement?
– Yes. The bill provides that it shall operate for twenty years.
– That is an exceedingly generous limit, and to my mind it could probably be reduced. Does the agreement date from the present time?
– .From the time of signature. The whole of the money involved in the building or purchase of houses during the twenty-years period will have to be paid with 5 per cent, interest at the end of that term.
– Does that apply to all States? ,
– Only to Victoria; but the bill will not affect the existing rights of returned men.
– I hope that the Minister will reply to the points that I am raising. Is a soldier’s eligibility to apply for a home to continue indefinitely? Can he apply for a home 25 years hence, and have 30 or 40 years in which to make repayments? If that were the case, the last chapter concerning war service homes would not be reached until about the year 2,000. It seems to mc that a time limit should be fixed within which applications should be accepted.
– That is not in the bill. Only death will terminate the rights of returned soldiers in respect of housing privileges.
– That is a point which might very well be considered by the Government. Most returned soldiers and returned soldiers’ organizations would not object to a reasonable time limit being fixed. Another point to which I desire to direct attention is the fact that coincident with this measure we shall have the Government’s new housing proposals in operation. All the States are operating home-building schemes and all are working on much the same principle. This agreement with regard to war service homes superimposed on the Commonwealth housing scheme and the various State housing proposals will make a three-decker housing scheme, which must create a certain amount of duplication. It has been urged that State housing authorities can build more cheaply than the Commonwealth. As a general rule, the States, while not ignoring their obligations to returned soldiers, consider that the provision of homes for them is an obligation resting definitely upon the Commonwealth Government; and, moreover, the State schemes are so’ organized as to allow for a margin of profit on the transaction. I should particularly like the Minister to give the House some assurance as to the time limit within which application may be received, and the eligibility of applicants.
– I should like to know if the Victorian branch of the Returned Sailors and Soldiers’ Association has been consulted with regard to this proposed agreement, and if that body has raised any objections to it; also if it is the intention of the Government to continue the erection of war service homes in Victoria in addition to building operations that will be carried out by the State Savings Bank.
– I have not had time to study the agreement, so I do not know what will be the position if a returned soldier in Victoria wishes to have a home erected for him. Will he be required to make application to the Minister, and will his application, if approved, be forwarded to the Savings Bank Commissioners, or will the commissioners have the right to determine whether he is entitled to the benefits enjoyed by other returned soldiers under the War Service Homes Act?
– If a returned .soldier is eligible, he may demand to be supplied with a home.
– And the liability to provide it is laid on the commission.
– I should like to be fully satisfied on this point. In a big country like Australia it is absolutely impossible to .administer the act satisfactorily from Canberra. The Western Australian Government and the Queensland Government are in a much better position to ensure efficiency of administration in those States. .At the outset a mistake was made in not entering into an arrangement with the various State Governments to carry out the building operations under the War Service Homes Act. I am aware, of course, that no good can result from a discussion of that matter, now ; but I wish to be thoroughly satisfied that under this agreement the privileges of returned soldiers in regard to housing will be at least equal to those of any other citizen. I should strongly object if any person in Australia under a Commonwealth housing scheme could obtain a home costing £1,500 or £1,800 if returned soldiers could not get homes costing more than £800 or £950.
.- The building of war service homes by the Commonwealth Government, which commenced in a blaze of glory, came to an end in 1922, when the honorable member for Wannon (Mr. Rodgers), who was then a Cabinet Minister, made an agreement with the State Savings Bank authorities in Victoria. Since then the State authority has erected over 3,000 houses, to the complete satisfaction of all concerned. This is a machinery measure to continue that arrangement. Every’ privilege enjoyed by returned soldiers under the War Service Homes Act is safeguarded to them tinder this bill. My colleague, the
Minister for Works and Railways (Mr. Hill) is administering the department, but I have taken a deep personal interest in it, because I- am administering the sister department of Repatriation, and I can assure honorable members that under this measure the privileges of all returned soldiers are adequately safeguarded.
– Since the agreement has been so successful in Victoria, is it not possible to extend it to the other States ?
– The responsible Minister will consider that phase of the question.
.- The bill touches a very important subject, upon which one could speak for a considerable length of time. I have no desire to reflect on the administration of the War Service Homes Act in the past but I think it will be generally admitted that, as a result of experience gained during previous years the act is now being administered in a thoroughly satisfactory manner. There are practically no complaints. At all events there are no complaints of a serious nature in connexion with the building of homes or with the administration of the act. It may be of interest to honorable members to know that 31,642 homes have been built by the Government at a cost of £24,761,539. It is gratifying to the department’ to know that the scheme is now working smoothly. A private landlord administering even 100 homes would very quickly be in deep water. The honorable member for Reid (Mr. Coleman) suggested, I believe, that the salaries paid to the administrative staff are too high. I am convinced, however, that the honorable member will, acknowledge that it is not extravagance to pay well for efficient service.
– I do not wish that impression to be created. All I said was that there has been a greater margin of increase in the case of the central administration. I do not believe in the payment of low salaries.
– The honorable member seemed to fear that under this agreement certain drastic alterations would be made in the building of homes, and that the agreement itself might make it possible for the Government to rid itself of any responsibility for the erection of war service homes. The Government has no intention of doing that in - either New South Wales or Queensland. Homes are being erected in those States by the War Service Homes Commission, and the work is being carried out quite satisfactorily. In Victoria building operations have been for some time in the hands of the State Savings Bank, under an agreement with the Commonwealth Government, and we are now having homes erected at a reasonable price. Because of labour and other conditions prevailing in New South Wales the cost is somewhat1 higher in that State. The prices for building materials vary in the different States, and consequently there is a slight difference in building costs. The honorable member for Wannon suggested that by this bill we were setting up two distinct building authorities. The original agreement with the State Sayings Bank was initiated by the honorable member himself. As a necessary condition to any such proposal the bank declined to accept responsibility for homes previously provided by the commission in Victoria or then in course of erection. Consequently, the commission was obliged to deal with all matters associated with the homes which it had built or acquired. As the assistance of the bank was invited under the circumstances set out, the Government thought that it could not press for the elimination of that stipulation in the fresh agreement with the bank, which is, in reality, but an extension of the original one. Some organization must administer the homes built by the commission in Victoria, and as the cost of the commission’s administration is not greater than the rate of remunerataion paid to the bank, there is no duplication in Victoria. The cost of administration in that State will, under the new arrangement, be reduced from 15s. per cent, to 13s. per cent. I wish to make it clear that this 15s. per cent is not paid by the returned soldier. Fees up to 1-J per cent, on the cost of building, including legal costs, preparation of plans and supervision, which, spread over a house costing £800, is only £12 are paid by the soldier. This is a reasonable figure. If a private architect prepared plans and supervised the erection of a building costing ?800, his fees, based on 5 per cent, of the cost, would be ?40. The honorable member for Wimmera (Mr. Stewart) wished to know if, under this agreement, payments plus interest are to be made to the Victorian Government at the end of twenty years. The State will be responsible for the administration during that period. In the case of wooden houses, a returned soldier will make repayments over a period of 25 years. If the houses are of brick, the soldiers will have 37 years in which to purchase them. The insurance under this arrangement will be practically the same as heretofore, and the soldier is not in any way to be placed in a less favourable position.
Question resolved in the affirmative.
Bill read a second time.
Clause 1 (Short Title).
.- I listened attentively to the Minister as he briefly explained why the Commonwealth authority should remain, as well as the State authority, within the State. I remember well the negotiations that took place when the first agreement was made. In view of the unsatisfactory atmosphere that surrounded the building of war service homes at that time, the many complaints from the soldiers respecting constructional defects, and the unfavorable conditions generally, the Commonwealth Bank decided not to accept responsibility for homes not built under its supervision. That was the dominant reason why the bank would not undertake the whole of the building programme within the States. The position has now changed. To-day the war service homes in Australia represent a great asset. Taking the cost of land, materials and construction they have been a magnificent present to the returned soldiers.’ I believe that if the Minister would only persevere, he could make arrangements with the different State savings banks to take over, not only the homes already built, but also those still to be built for returned soldiers. If that were done, we would be able to effect many economies.
Clause agreed to.
Clause 2 (Definitions).
– Can the Minister explain the difference between the administrative costs?
– I presume that the honorable member is refering to the administrative costs as between one State and another. The administrative costs in Western Australia are 15s. per cent. In Victoria they are 15s. per cent., but will be 13s. per cent, under the new agreement In Tasmania they are 15s. per cent. Many years ago an agreement was entered into between the Commonwealth Government - not the Commissioner - and the South Australian Government, and under it the State Savings Bank agreed to carry out the whole of the work on the basis of an administrative cost of 10s. per cent. At various times complaints have been made that the costs are too low, and I must confess that the work has been carried out at a very reasonable figure. I think probably that there will be a movement instigated to increase the administrative charges in that State to the level of those which will apply under this agreement.
– The honorable member for Reid wants to know why the costs are different in New South Wales and Victoria, one being under the control of the savings bank and the other under the control of the commission?
Mr. BULL. The administrative charges in Victoria have certainly been slightly lower over a period of years than those of New South Wales, but there will not be much difference between the costs under this agreement and those which now obtain - probably about ls. per cent.
Clause agreed to.
Clauses 3 and 4 agreed to.
Clause 5 (Effect of notification).
– This clause provides for the asignment of interests from the Commissioner to the State Savings Bank of Victoria. I have no objection, as a general principle, to the bill or to the agreement. I point out, however, that this is a rather curious method, from a legal point of view, of assigning contracts, or choses in action, to new parties provision being made for the consent of the other contracting party - the soldier himself. That is a point of more than technical importance. The clause substitutes the bank for the Commissioner, and to that extent substitutes the bank for the Commonwealth. While I shall be glad to have the benefit of the experience and the proven capacity of the State Savings Bank of Victoria in carrying out the actual construction and supervision of homes for the ex-soldiers, I will never consent to the surrender of the Commonwealth’s responsibility. Any action that tends to break down or to destroy the connecting link between the soldier and the Commonwealth Parliament, will, I think, be strenuously opposed by, at least, this side of the committee. I suggest that there is a legal peculiarity in this clause, but I assume that the Minister has had the benefit of the advice of his law officers, and I, therefore, have no more to say about it. I am much interested in the building of war service homes for the personal reason that there is a large number of returned soldiers in my electorate. Quite irrespective of that I naturally have a keen desire that the promise so emphatically given to the returned soldier when he enlisted shall be made good. I have sometimes had occasion to criticize severely the administration of the war service homes. I do not propose to repeat those animadversions for the reason that recently, at all events, I have had no complaints from those who are most affected by the administration. I heard the honorable member for Wimmera (Mr. Stewart) eulogizing the work of the former Commissioner, Mr. Semmens, and the secretary of the commission, Mr. Peterson. I have previously criticized both those officers, and all I wish to say about the former is that his work in connexion with the War Service Homes Commission has been of a negligible character. His association with it was brief, and was not characterized by any significant service. I mention this for the reason that this gentleman went out of his way- and I do not think that this will be forgotten - to say publicly that he did not take any notice of what members of Parliament said to him in regard to his public activities. Possibly the fact that he has closed his ears to information that might have come to him from that source would account for his want of knowledge on a number of matters about which he should have been informed. It is also probable that he closed his mind to other useful sources of information. As to the secretary of the commission, I admit that he at least is doing the work.
– All that the honorable member said about him was justified.
– I have no intention to withdraw anything that I have previously said. I have tried within my limits to be just to all parties. Mr. Peterson has carried the burden of the work, and in recent years I have had no complaints to make, and I make none now. I do not desire to delay the passage of the bill. I approve of its principles, and if there are any legal peculiarities in it, I presume that ‘ they- will have the attention of the responsible law officers. I sincerely hope that we shall profit by our bitter experience, that we shall be able, in time,toretrieve the fundamental errors that have been made by successive Nationalist Governments, and to do justice to the soldiers whose claims are undoubtedly of paramount importance, as well as to the taxpayers of Australia generally.
– I wish to know from the Minister whether- under this agreement we are handing the control of the war service homes to the State Savings Bank of Victoria, without providing for an appeal by the soldier occupant to any federal authority? If that is so, it is a curious omission from the bill. I heartily concur with the sentiments expressed by the honorable member for Batman (Mr. Brennan). We should not interfere in any way with the returned soldiers’ right to appeal for redress to the Commonwealth Parliament.
– My experience of the building of war service homes in New South Wales is that it has been very satisfactory. I cannot understand why the Federal Government should provide money for the Victorian Government to build soldiers’ homes in Victoria when similar work is being carried on in New South Wales and
Queensland by the War Service Homes Department. If the work in Victoria could be carried out at a cheaper rate under this agreement than it is being done in the States I have mentioned, there would be some justification for the Government’s proposal, but I understand that under this arrangement the cost in Victoria will be higher. The work of constructing soldiers’ homes in Victoria should be carried out by the organization established for the purpose, particularly as it could be clone at a lower rate.
Clause agreed to.
Clause 6 agreedto.
Clause 7 (Saving of powers of State Parliament).
.-I think the Minister (Mr. Hill) should reply to some of the questions raised by honorable members. This clause has a bearing upon some of the remarks of the honorable member for Batman (Mr. Brennan), who rightly said that we are committed by contractual obligations as well as by promises to returned soldiers. These promises should be regarded as sacred by honorable members, who act as trustees for the occupants of war service homes. There is not only a legal, but a moral element involved. Clause 7 reads -
Nothing in this act shall be deemed to prevent or impede the exercise by the Parliament of the State of Victoria of any legislative power of the State in respect of a property, specified in a notification under section four of this act.
Does that mean that once this agreement operates the Victorian State Parliament can vary the conditions under which war service homes in Victoria are occupied ?
– Certainly not.
– Then what does the clause mean ? Possibly the Victorian Government will” have power to alter the whole scheme and increase the rates of repayment by occupants- of war service homes.
.- The Victorian Parliament will have no power to vary the terms of the agreement. I am sorry that I could not reply at the moment to the point raised by the honorable member for Batman (Mr. Brennan) in regard to the right of appeal. There is no right of appeal under the present War Service Homes Act, under this bill, or under the Repatriation Act. The practice has developed, however, of appealing to the Minister in charge of the department, and such appeals have been always considered by him. There is nothing in the present bill to prevent appeals being made in the future, as in the past. The honorable member for Wimmera (Mr. Stewart), who was in control of this department some time ago, knows that appeals were frequently made through the commissioner to the Minister. These appeals can still be made to the Minister.
– What will be the use of appealing to the Minister when the work will be under the control of the Victorian Parliament ?
– If any disagreement should arise on that or any other matter, the agreement can be cancelled by either side giving three months’ notice.
.- The honorable member for Batman (Mr. Brennan) should be an authority on the meaning of clause 7, which appears to provide that all property that passes from the control of the commission shall become subject to the Victorian State law. It is provided, however, that nothing in this agreement shall in any way diminish, lessen, or impede the rights in relation to properties that pass from the control of the Commonwealth to the State.
Clause agreed to.
Schedule agreed to.
Title agreed to.
Bill reported without amendment; report adopted.
Bill read a third time.
In Committee of Ways and Means
Consideration resumed from 12th De cember, 1927 (vide page 3022), on motion by Mr. Pratten -
That the schedule to the Customs Tariff be amended.
By omitting the whole item and inserting in its stead the following item: - “41 (a) Butter and cheese, per lb., British 6d., intermediate 6½d., general 7d.
– For nearly three years those engaged in the dairying industry have been agitating for some consideration from this Parliament with regard to the items of butter and cheese. The imports of butter come almost entirely from New Zealand; but there are heavy importations of cheese, particularly processed cheese, from the Northern Hemisphere. This matter has been most exhaustively investigated, and as the result of certain recommendations, the Government propose to practically double the present duties. I think it will be generally admitted by honorable members that at present the dairying industry is not regarded by those engaged in it as particularly attractive. It is, therefore, the duty of this Parliament to do what it can to help the industry by imposing duties which, will enable it to become stabilized. This will also have the effect of removing the industry to some extent from the control of dealers in butter, who do not care for the industry or its interests, and who are considering only their own personal ends. Closely allied with this subject is the reciprocal treaty which is in operation between the Commonwealth and New Zealand, Up to the present the Government of New Zealand will not regard the action being taken by this Parliament as an alteration of the duties on the commodities specified in the treaty, and it will possibly insist upon the statutory six months’ notice being given, as it is entitled to do. Quite recently the New Zealand Government has amended the duties on wheat and flour and other commodities covered by the treaty. For the information of the committee I should like briefly to state the position. The principal . items of New Zealand production on which New Zealand is entitled to a preferential duty, imported into Australia last year were butter, fish, meat and timber, which, together with other similar items, were valued at about £1,161,000. During the same period, Australia exported to New Zealand about £.1,355,000 worth of goods on which preferential duties were given by New Zealand. Of the principal commodities not covered by the treaty New Zealand exported to Australia about £1,215,000 worth, whilst we exported to New Zealand about £2,133,000 worth, included in which was wheat valued at £823,000, flour valued at £167,000, and coal to the value of £510,000. In view of the changes that have taken place in the New Zealand tariff, and of those that will be made in our tariff schedule, the time seems ripe - particularly in view of the many anomalies that have arisen in connexion with our trade with New Zealand, and in connexion with the British preferential tariff - to renew our negotiations with the New Zealand Government. Another matter that we should consider is that New Zealand gives British preference to some British dominions and Crown colonies, but not to Australia. Therefore, with the information that is before me, it seems that the proposals of the Government could not prejudice reciprocal arrangements with New Zealand, but that, with the alterations in their tariff and in our own, the time is ripe for the ^renewal of negotiations that will be advantageous to both dominions.
Sitting suspended from, to 2 p.m.
.- I had not intended to speak upon this or any other matter during the present session. Ever since I have been a member of the Commonwealth Parliament, I have noticed that, no matter how intense may be the battery of rhetoric and criticism that is directed against proposals such as this, the effect is negligible, and I concluded that any effort of mine would be about as futile as the barking of a dog at an opossum in the top of a tall tree; he makes a lot of noise, but gets nowhere, and is not even able to frighten the beast. Therefore, when this tariff schedule was introduced, I decided to continue to observe the masterly silence that I had maintained for so long. But when I saw that it was proposed to increase to 6d. a lb. the duty on butter, I resolved to raise my voice in protest. There are not very many subjects about which I claim to possess any knowledge, but this is one of the few in respect of which I can confidently make that claim. I object to this proposal, in the first place because I am confident that, to a great extent, the tax” to be levied will be taken out of the wrong pockets and that the biggest part of it will go into the wrong pockets. I do not think that any person in Australia has a wider knowledge than I have of the troubles of the dairymen. I have been a dairyman, and for many years was trained in that line of business, so I realize that they are entitled to every consideration. But, in my opinion, the benefit which they will derive from this increased duty will not be commensurate with the injury that others will suffer from it. For a number of years I was the biggest retail distributor of butter in Australia. It must, therefore, be admitted that I have some knowledge of that end of the business. I say without any reservation that the workers are responsible for the consumption of at least 75 per cent, of the total quantity of butter that is consumed in Australia. It is only by exercising one’s body that one can assimilate fats to any extent. When I was in the trade, it was the practice foi- the wife of the worker, and sometimes the worker himself, to purchase at least 5 or 6 lb. of butter every week. As a rule, the workers have fairly large families. It is as well that they do, because they thus make up for the deficiencies of others. When they were placing their orders, they would say to me, “ Look here, old man, do not be too hard on us, as we have a big family to keep, and it takes us all our time to make ends meet. Give us as good as you can, as cheaply as possible.” On the other hand, some of the “ silver tails,” or aristocrats, would insist upon being supplied with superfine quality, of which they would take, perhaps, half a pound. At the end of three or four days, when a portion of it had been consumed, they would return the balance with the message that, although it was fairly good when they bought it, it had deteriorated very quickly. They would ask to be reimbursed in respect of the portion returned, and would then purchase another quarter of a pound. An increase of 4d. or 5d. a lb. during the winter months in the price of butter must penalize the wage-earners. That effect is absolutely certain to be caused if this proposal is agreed to. Denials notwithstanding, I affirm that the price of butter is bound to rise.
– Does not the honorable member wish the dairyman to get a better return for his labour?
– Certainly I do; but it would be far better to give him a straight out subsidy. I am convinced that a big percentage of this additional amount will not find its way into the pockets of the dairymen. There are at present five times as many parasites living and thriving on the production of the dairymen as at any time during my thirty odd years ‘association with the industry. The Tariff Board unquestionably was actuated by the highest motives, and honestly endeavoured to ascertain the true position; but it has not achieved that object. The Minister for Trade and Customs (Mr. Pratten) probably believes that this proposal will assist the dairymen. I do not think that it will, to anything like the extent of a subsidy of, say, 2d. a lb. We have a. butter control board, which has been invested with almost unlimited power. It can say if, when, and how butter may be shipped, who may sell it, and when and under what conditions it may be sold.
– And at what price?
– Practically. It is not able to regulate the price overseas, because that is in the hands of the oversea buyers. By a peculiar coincidence the members of this board comprise what is known in the trade as the butter combine, which controls over 90 per cent, of the distribution of butter in Australia. I do not in any way impeach their character. On the contrary, I wish honorable members clearly to understand that I regard them all as good men. In Victoria, there are the two, Mr. Wilsons, one of whom is the manager of the Gippsland Co-operative Distributing Company, which is really a joint stock company. I have no word to say regarding the co-operative producing companies; but I. do assert that the co-operative distributing companies are in reality merely joint stock, speculating companies. On the Victorian board also are Mr. BT. Osborne, who controls the western district company, and Mr. Holdenson, who is one of the biggest proprietary factory owners in that State. They are both good men.
– Good to themselves.
– Tha That is so; but it cannot be denied that when they were working on a competitive basis they rendered excellent service to the dairying industry. When he has not to face competition, what man would subordinate his own interests? On the New South Wales board is Mr. Clifford, the manager of the North Coast Company, which controls the largest series of butter factories in the world.
– That is a co-operative company.
– There are also Mr. Mears, of the Coastal Farmers’ Company, and Mr. Foley, who operates from the London end, and is one of the biggest proprietary men in Australia, if not in the world. In Queensland, there are .Mr. Plunkett and Mr. Harris. Mr. Harris is a cream producer.
– It is Mr. Gibson, not Mr. Harris.
– In South Australia there is Mr. Froman, manager of the South Australia Co-operative Dairying Company, and in Western Australia Mr. Clarke. I allege nothing against these men except that, while they control what is known as the butter control board, they also fix the price for the Australian trade.
– Are they not elected by the dairying interests?
– Of course they are; but the honorable member is not aware of that.
– I am aware of it. I know, also, that they are in a position to cause a shortage in Australia by manipulating the export of butter.
– Are they likely to do that?
– I do not know what they are likely to do. I am criticizing, not the men, but the anomalous position in which they are placed. Is it a fair thing that men who control’ the export of butter and are thus able to cause a shortage, should also be in a position to fix the price for Australian consumption ? I do not impugn their honesty, and never have done so. Every week these boards meet in Melbourne, Sydney and Brisbane, for the purpose of fixing the price of butter in Australia for the ensuing week.
– They base the price on London parity.
– They do not. The average price of butter in London this year has been no more than ls. 7d. or ls. 8d. per lb. retail, whereas in Australia it has been 2s. per lb. retail.
– Freights and other charges are taken into consideration.
– They would not amount to more than 2d. per lb. These facts are indubitable, and cannot be disputed. In January, February, and March, which are the principal producing months, scores of thousands of cases of butter are stored. I have been a butter speculator, and was responsible for the biggest deal that has ever been put through for Western Australia. Therefore I am acquainted with the methods that are adopted. A large quantity of butter is stored, so as to make provision against a probable winter shortage in June, July and August, when Australia does not produce sufficient to supply her own requirements. I have previously shown that, in 1925, we imported 63,000 cases of New Zealand butter concurrently with shipments overseas to the extent of 93,000 cases of our own product. The price which we realized was at least 6d. per lb. below that which New Zealand butter was landed in Australia. What was the reason for this operation. Nearly 200,000 cases of butter were held in cold storage, and the importations had the effect of standardizing its price at the level of that of the New Zealand product landed in Australia duty paid.
– Where was that butter stored ?
– In the warehouses in Melbourne, Sydney, and other cities and Western Australia.
– Who is responsible for that?
– The speculators. I am not blaming them for doing it.
– Who are they ?
– The members of the control board were the biggest importers of New Zealand butter in 1925-26.
– How does the honorable member know that?
– I know it to be the absolute truth.
– There is no truth whatever in the statement.
– The honorable member may later rebut my statements if he can. What will happen if this proposed duty is retained? Simply this, that during January, February, and March, when butter is plentiful in Australia, a great deal of it will be stored. The men who store it will do so in a perfectly honorable way. They will be seeking to make money, which, after all, is what we are all trying to do. They will know that there will be 6d. per lb. duty on New Zealand butter; in addition to which there will be a charge of £d. per lb. to land it in Australia, and an extra charge of Id. per lb. above the London f.o.b. price, which New Zealand always charges us for the butter we purchase from her. So there will always be a margin of about Sd. per lb. between the overseas parity price of Australian and New Zealand butter landed in Australia. Knowing that to be so, the dealers in butter will make thousands of pounds during the season by buying at the right time here, and storing their purchases for release later when the price has increased. The Paterson scheme has been worth a huge amount of money to butter speculators. I do not blame the Minister for Markets and Migration for that. His scheme was better than none; but from one point of view it was bad. I compare it with the parent of a large family who wants to insure an even distribution of his wealth among his children. He makes arrangements to do so, but wastes too much of his energy in the process of doing it; that does not increase his wealth; it only leads to a more even distribution of what is left of it. That is exactly what the Paterson scheme does for the dairy farmers. The local price of butter to-day is 172s. per cwt., while the London price is 158s., which works out at about 140s. f.o.b. Australia. The imposition of this duty will give speculators an exceptionally fine opportunity to make money
– Would it not pay the speculator to go to New Zealand and buy the butter there rather than buy it here and store it for later sale?
– Not at all, although, of course, a small quantity of New Zealand butter will come in during the months of scarcity. It will be quite clear to every butter dealer that with a duty such as this in operation there must always be a difference of about 8d. per lb. between the price of New Zealand and Australian butter, and that is a margin which is worth working upon. I have been a protectionist all my life, but when protection is made an excuse for exploitation, or for coddling an industry, I am totally opposed to it. I remember when the first protective tariff was introduced into the Victorian Parliament. It was the subject of many warm discussions. One argument that was freely used was “We have our own hides and leather, why should we not make our own boots ?” The reply to that was “ If you attempt to do that, you will have to pay a higher price for inferior boot3 “, to which the rejoinder was made “ You may have to do so for a while, but not for long “.
– I point out to the honorable member for Fremantle that leather is not butter.
– I was illustrating a point, Mr. Chairman. I believe that by the imposition of these extraordinarily high duties Australia is following a false scent, or in plain terms, choosing an economic lie, and if you follow any lie long enough it will inevitably lead you into a bag. It reminds me of an incident of my youth.. When I was a lad I had on one occasion to hunt for” my horse in a Gippsland swamp. While I was looking for it four or five lyre birds crossed my path and pretended to be crippled. I decided to try to catch one. Time after time I almost had my hand on it when away it hopped. I followed it again and again only to just miss catching it. At last I found that I had been lured into a thicket and was lost. I almost starved to death. I have sat in this chamber and listened quietly to a great many speeches on the tariff and other subjects. I could have made as much noise as any other member, and doubtless to so little purpose, of course; but I preferred to listen. I have come to the conclusion that Australia is, as I have said, following an economic lie, and that sooner or later she will lose herself in a thicket. The imposition of this duty will not be particularly advantageous to the dairyman. It will not add. to their wealth, but like the Paterson scheme, will only lead to a different distribution of what is left of it after passing through many hands. The unfortunate thing is that the worker pays every time. I submit that we must find some other way out of our financial troubles. I know the butter-producing business from beginning to end, and I am firmly of the opinion that this proposal will not help it to the extent that it will penalize the consumer.
.- The honorable member for Fremantle (Mr. Watson), like most other honorable members who represent Western Australian constituencies, has forgotten that protection is the accepted fiscal policy of Australia.
– Here is another lyre bird.
– The honorable member for “ Grouse “ is also an ardent freetrader, who would like to reverse our fiscal policy. Although the great majority of our people are aware that protection frequently increases the price of certain commodities, they support that policy for they realize that it will stimulate the development of primary and secondary industries here, and create employment for hundreds of thousands of people. The dairy farmers of Australia are agreed that it is not desirable that we should purchase our requirements from China, Japan and certain other lowwage countries, even though by so doing we should get them at a reduced price, for they believe in protection. AH that they ask is that they shall he granted a reasonable measure of protection for their industry. The honorable member for Fremantle has told us that he was one of the biggest retail distributors of butter in Australia. He also admitted that he was in the business to make profit out of it. He even said he was a speculator. He does not care where his butter comes from so long as he is able to sell it at a substantial profit. He is oblivious of the fact that by buying New Zealand butter he is providing employment for New Zealand dairymen when patriotism surely requires that his first concern shall be to provide work for Australian dairymen.
– I have forgotten more about butter than the honorable member has ever learnt.
– I am afraid that the honorable member has forgotten too much about it. At any rate his point of view is that of the speculator and trader, and not of the dairyman. If this increased duty is approved, speculators will not be able, profitably, to import New Zealand butter for sale in Australia. The duty will thwart them, and the Australian “ dairymen will consequently be- able to carry on their industry under reasonably good conditions without the constant fear of a flooding of the Australian market with New Zealand butter. Australia’s production of butter is worth £20,860,000 a year. For the last few years we have imported butter from New Zealand at the rate of £235,000 worth per annum. The honorable member for Fremantle is wrong when he says that if we prevent this butter from coming in from New Zealand, the consumers of Australia will have to pay more for their butter. The speculator will make less. The difference in price to the consumer will be very small. The gentlemen who import butter from New Zealand when prices are low store it until prices increase in Australia, and then unload it at a considerable profit to themselves. It is the duty of the Government and the Dairy Produce Export Control Board to see that adequate supplies of butter are kept in Australia’ for local consumption. When the board was established the Minister said that the dairy farmers would derive immediate benefit. He held out the Dairy Produce Export Control Bill as a panacea for all the ills that beset the dairy farmer, but we find that the benefits it has conferred are infinitesimal, and that the board has not managed the business in a way that would result in any appreciable increase in the returns to individual dairymen. It is the duty of the Minister to see that some change is made in the personnel of the board. Of the butter produced in Australia, two-thirds are consumed locally and the balance is exported, but Australian dairymen have to produce their butter under Australian standards. They have to pay wages, and because of the protection that has been given to the secondary industries increased prices for the utensils and machinery they use. In comparison with prewar prices, the cost of these is extremely high. In the circumstances, therefore, I think they have a right to expect protection from the Commonwealth Parliament. There is no consistency in the claim of those who say that special protection should be given to the big city manufacturers, but that the man on the land should market his product on a freetrade basis. I do not think that the duty proposed will’ afford any great relief to the dairy farmers. In fact, I do not think the Government has done anything since it has been in office to give any relief to these people. At least it has done nothing of permanent benefit to them. Something very fundamental will have to be done to afford the dairymen of Australia proper relief. As a matter of fact I think that our primary producers will have to recognize that the solution of many of their problems lies in adopting an Australian-wide organization, something on the lines of the proposals of the Labour party as put into operation already in Queensland. In that State there was a Primary Producers’ Organization. Each district has a local producers’ association. All the local associations in a certain area have the right to send a delegate to a district council. The district councils in turn have the right to send delegates to the Central Council of Agriculture in Brisbane. Such an organization could be made to apply all over the Commonwealth. Each central State council could send a delegate to a grand central council for Australia. It was the honorable member for Dalley (Mr. Theodore) who, when he was Premier of Queensland, initiated the scheme I have outlined. The Commonwealth Government has done nothing to bring about a wide-spread organization for the producers.
– I suppose the honorable member is aware that there is a scheme in existence.
– I am aware that there are in existence some hotch-potch schemes that are not very effective. I trust that the dairy farmers of Australia will realize the advantage that is likely to accrue from more efficient co-operative marketing and direct control of their own industry from the time the commodity is produced until it reaches the table of the consumer. I trust that they will also realize the advantage of establishing their own banking system, which would make the cost of financing their produce considerably less than it is to-day. They have a right to ask that the price of the commodity they produce should be based on the cost of production. The price enjoyed by the manufacturer is the cost of production, plus a certain amount of profit, and I think the primary producers are entitled to be put on the same footing. Those who say that the cheapest possible price should be paid for the products of the soil, irrespective of the conditions of production, might just as well advocate the employment of coolie labour in the production of butter or any other commodity. No one can stand for the sweating of the 120,000 dairymen in Australia. If butter produced by the sweated farmers of New Zealand can be brought into Australia under the existing duties, we have a right to increase the duties to keep it out.
– Does the honorable ‘ member speak of the sweated farmers of New Zealand?
– Yes ; the dairy-farmers of New Zealand are overworked and underpaid, just as dairy-farmers are in practically every part of “the world today. The dairy-farmers of Australia have “had a particularly bad time. I represent a good many of them, and I know the view-point of the workers. No body of industrialists in Australia stands for the sweating of their fellow industrialists who are attempting to earn a living on the land. I believe that the cost of living should be based on the cost of commodities. If the cost of living goes up, wages must also go up. A prominent industrialist in Queensland said that industrialists did not favour sweating butter producers. If butter went up the Arbitration Court should fix the basic wage upon the cost of living, having in mind the increased cost of butter. Are we to sweat and overwork the dairy-farmer in order that the cost of hisproducts may be kept down? If protection is good for the manufacturer it is likewise’ good for the dairy-farmer.
It is true that there may be a small increase in price if we prevent New Zealand butter from entering Australia; but if protection is good, for the manufacturer it is also equally good for the dairy-farmers. I have received a great many communications from dairymen in Queensland - I quoted a number of them on the budget - asking for a duty of 6d. per lb. The request for this originated in Queensland, and was put before the Minister by a deputation.
Mr.R. Green. - It actually originated in New South Wales months before -that.
– Statistics show that the dairying industry is a very important one for Australia, and anything that strikes a blow at the welfare of the industry will prove detrimental to Australia as a whole. The value of the industry in 1925-26 was £32,132,000, of which butter represented £20,860,000 and cheese £2,000,000. I have a table showing that importations of butter are unnecessary. The table gives the importations and exportations during the following years: -
For the six years ending the 30th June, 1927, Australia’s exportation of butter was valued at £41,500,000, and the importations at £1,250,000. For the last two years the importations have been worth £760,000. Last, year the importations were worth £519,000. Under closer settlement policies hundreds of thousands of acres of land in Queensland and other States have been thrown open for dairying, and the production of butter is gradually increasing. Some people would bring butter in from New Zealand ; but that dominion is not the only country from which we obtain supplies. Some inconsistent protectionist who wants to help big interests in cities would land primary products from other countries and ruin the market for these Australian producers. The preferential tariff of 2d. per lb. to New Zealand, and the duty of 3d. per lb. on butter from other countries, have proved inadequate. I should like to see the Minister for Trade and Customs take steps to make the increased rates operative at once. According to the treaty between the Commonwealth and New Zealand six months’ notice has to be given on either side to vary any rate of duty in the schedule, but I notice recently that New Zealand has, by negotiation with the Commonwealth Government, increased the duty on Australian flour and wheat, and the duty was to become operative immediately. If that could be arranged in regard to Australian flour and wheat entering New Zealand, surely we can make a similar arrangement in regard to New Zealand butter coming into Australia. The Minister should be able to increase the duty from 2d. to 6d. per lb. at once.
– The amended New Zealand duties on flour and wheat were not fixed, but were on a scale varying according to the world’s parity.
– Does the Minister say that the increased duty cannot become operative against New Zealand at once.
– Not without the consent of New Zealand.
– Probably as a result of further negotiation the consent of the New Zealand Government will be received. A great deal of advice has been given to the dairyman of Australia by armchair experts, amongst whom I include the Prime Minister and Mr. W. H. Gepp, chairman of the Development and Migration Commission. Mr. Gepp has visited different dairying centres and lectured the farmers upon the need for greater efficiency in the production of butter and cheese. He may be a noted metallurgist, but he knows absolutely nothing about dairying. It is easy enough to tell the farmer that he should adopt more efficient methods and improve the quality of his herds, but having regard to the fact that the receipts of the dairy farmers from the local butter factories in my district averaged over twelve months 50s. a week, what is the use of talking to them about the need for improving their herds, 50 per cent, of which were wiped out in the last drought? Some help must be given to them by the Government. A. considerable time ago the Commonwealth Government promised that it would assist the dairymen to improve their herds by advancing to them money for the purchase of better stock. »
– The dairymen were doing very well seven or eight years ago.
– I shall prove to the honorable member that dairy farmers in Queensland have increased their efficiency considerably during recent years. It is idle for Mr. Gepp and other selfappointed experts to tell the dairymen that they must improve their herds, and’ adopt better methods of cultivation. For a long time these gentlemen have been getting a certain amount of kudos in some quarters for the interest they are taking in the dairy farmer, but they have done nothing practical to assist them. Statistics prove that the dairymen have done a great deal to raise the standard of their herds and increase the efficiency of the industry ‘generally. . A fact that should be borne in mind by honorable members is that ploughs that cost £4 or £5 before the war, cost £16’ to-day. Prior to the war the price of butter fat was, approximately, ls. per lb., and a plough of a certain type cost the equivalent of 100 lb. of butter fat. To-day, with butter fat worth ls. 6d. per lb., the price of the same plough is equivalent to 200 lb. of butter fat. In other words twice as much butter fat is required to buy a plough as in pre-war days.
– Will the honorable member help me to reduce the duty on ploughs ?
– The dairy farmers and all primary producers in Queensland believe firmly in the policy of protecting Australian industries, but they say, “ If protection is a good thing for the manufacturer it should be an equally good thing for us, especially as because of it we. have to pay increased prices for many of the articles we use, although by this policy we give employment to many Australians. We do not want New Zealand butter admitted almost free of duty to the ruin of our home market.” The trouble is that although the price of butter has increased considerably during the last twelve or fourteen years, the increases in the prices of other commodities have been proportionately greater. Surely no honorable member will support what is practically a freetrade policy in regard to butter and other primary products, and at the same time demand high protective duties for secondary industries. Dairying is annually becoming a more important industry, particularly in the growing State of Queensland, and anything done to help it will give a wonderful fillip to closer settlement in that State. The following comparative figures illustrate clearly the progress of the dairying industry in Queensland in the last ten years -
It will be noted that whilst the number of cows has almost doubled since 1915 the output of butter has nearly trebled. At the beginning of Federation, the butter production of Queensland was only 8,680,389 lb. and of cheese 1,984,705 lb. In those days the industry was in its infancy, but owing to better organization and co-operative control - the farmers acquiring butter factories and taking charge of the industry right up to and including the stage of the marketing the butter - very many more people have engaged in the industry, and the general efficiency has been increased. It is most unfair that a progressive industry like this should be discouraged by the competition of New Zealand butter. As an advocate of -high protection for the secondary industries, I claim also adequate protection for the primary industries, of which dairying is one of the most important. Men, women, and children engaged in this occupation work at least twelve hours a day; for what? In my district an average return of 50s. per week per dairy farmer. Will any honorable member say that those sweating conditions should continue? If so, let him advocate freetrade all round. But if protection is justified for the secondary industries, then it is justified for the butter industry and I claim that it is justified for both.
– I cannot allow this opportunity to pass without expressing my thanks to the Minister for Trade and Customs for the response he has made to the requests of the dairymen. I have been privileged to represent their conditions to him on many occasions. During his last visit to Queensland. I introduced to the honorable gentleman one of the largest and most representative deputations from the butter interests that ever assembled in that State. Other honorable members were good enough to support me on that occasion in urging the Minister to give greater consideration to the butter producer. The Tariff Board has made a very exhaustive inquiry into the. industry, and I am glad that its recommendation that the duty be increased from 3d. per lb. to 6d. British preferential, 6£d. intermediate, and 7d. general has been adopted by the Government. A satisfactory feature of the Government’s proposal is that substitutes for butter will be subject to the same impost, so that the dairying industry will not be deprived of the advantages that should accrue from this belated increase of protection. I was sorry to hear the Minister say that the New Zealand Government has not yet seen fit to waive the six months’ notice that is required under the reciprocal tariff so that the increased duty on butter may become immediately operative. The Commonwealth granted to New Zealand certain concessions in regard to flour and wheat, and it is regrettable that the Government of the Dominion has not shown a truly reciprocal spirit. The honorable member for Fremantle made the extraordinary charge against the Dairy Export Control Board that it had interfered with the normal price that should be paid for butter in Australia. He also argued that this increase of duty would operate to the detriment of the producers. The dairymen have applied for these increased duties, and twenty of their chosen representatives gave evidence before the Tariff Board, which was evidently convinced that increased protection was essential. In passing I would like to pay a tribute to the good work done by the Dairy Export Control Board in connexion with the export of dairy produce overseas. Unfortunately, owing to constitutional limitations, the control of internal trade is not within the province of the Commonwealth authority, and the present lack of prosperity and backwardness of the industry must be charged against the State Governments, and not against the Commonwealth. The importance of the dairying industry of Australia is indicated by the fact that the number of perr sons principally engaged in it approaches 150,000; in this respect it must be classed among the most important, if it is not the most important of the individual industries of the Commonwealth. The value of the output of butter, cheese, and condensed milk factories totals nearly £23,000,000 annually. It is, therefore, obvious that a reasonable degree of prosperity in the industry is a matter of very considerable concern in Australia. The Tariff Board’s investigation showed clearly that the industry is almost -wholly carried on by the unpaid and exploited labour of the women and children of the family of the dairy farmer, a system which means untold privations. The returns obtained would make it impossible to maintain the industry if it were necessary to hire labour at rates comparable with those paid in other industries. It may, therefore, be claimed with a considerable amount of reason’, that the whole community is getting the benefit of the low cost of production resulting from the conditions under which butter is produced. It is therefore, a matter of common fairness that the tariff should be so fixed as to improve the conditions of the dairy farmer, as far as it is capable of attaining that end. The amended tariff should help to improve the financial position of the dairy farmer by providing the means whereby he may obtain a higher price for that portion of his produce that is sold within the Commonwealth, a price that should assist him towards living in accordance with Australian standards of living. The Tariff Board, in its report, quotes figures showing three New South Wales co-operative companies’ returns to the suppliers. The average payment to each supplier for three years varied from £365 to £486 per annum. Out of these payments the farmer had to pay rent or interest on capital, maintain his herd, and provide for the support of his family. The board, states : -
The whole of the evidence tended to show that the butter industry is in a stagnant and unpayable condition, and, without exception, witness after witness described the lot of the dairy farmer as a constant struggle to make ends meet, and it was only possible to continue in the industry by utilizing the labour of the wife and family of the dairyman and working unduly long hours. Where labour is employed it is undoubted that it is paid extremely low wages, and even under the above conditions it was maintained on all sides that the dairy farm hardly paid its way, and did not give anything like a fair and adequate return to the dairy farmer.
The position is fast becoming most acute. Not only is the farmer broken in purse, but he is now becoming broken also in spirit, which is far worse. He is the lowest paid worker in the community, and he has to work the longest hours. A further fact which militates against the industry is that, during the period when butter -is being sold both for export and for home consumption, the London market price largely governs the price in the Australian market. This practically means that, during the exporting season, the dairy farmer gets no benefit from the tariff. He is forced to ship his surplus butter and cheese overseas, to be sold in open competition with the produce from low-wage countries such as Denmark, the Balkan States, Siberia, and the Argentine. It is true that the butter producer receives some assistance from the Paterson scheme, the basis of which is the payment of a levy of 1 1/2 d per lb. on all butter produced, the amount thus collected being used to pay a bonus of’ 3d. per lb. on butter that is exported This increases the return from exported butter, by the addition of 3d. per lb., to the export parity, and the automatic effect of this additional return is to cause a sympathetic rise in the local price. While this scheme, therefore, does benefit the butter producer, it is evident from the conditions existing in the industry that the benefit is of a partial nature. The imports of butter, almost entirely from New Zealand, were 2,991,243 lb. in 1925- 26, valued at £246,703, and in 1926- 27 the imports totalled 7,257,042 lb., to the value of £526,723. It is a remarkable fact that there should be any necessity to import butter so largely, considering that the Australian production far exceeds the supply necessary for domestic consumption. The benefit of the Paterson scheme is almost nullified by the large imports of butter from New Zealand, subject only to a duty of 2d. per lb. Butter is being dumped here from New Zealand at ls. 6d. , per lb., completely undermining the Australian market for our own producers. Although the Australian price should have been increased, action cannot be taken because of the fear that New Zealand will flood our markets, undersell us, and take the whole of the home market from us. The increase in duty will protect us from the threatened invasion of imports from that dominion. Every box of New Zealand butter consumed in Australia represents a similar quantity of butter required to be exported overseas to be sold at world prices in competition with low-wage foreign countries. At first sight it might be contended that the quantity imported bears a very small proportion to the quantity produced in Australia, as the production in 1926-27 was about 250,000,000 lb., of which something like 100,000,000 lb. would be exported, and that the quantity imported would therefore have little effect on prices. But it must be kept in mind that these imports are not spread evenly over the year. The butter is brought in almost entirely within a limited period, and just at that part of the year when the local production is falling off. The cost of production is then, for that reason, at its highest point, and the return to the dairyman is at its lowest point, lt is a reasonable claim on the part of the butter producer that, when the price rises in accordance with the law of supply and demand, he should be able to get the benefit of that rise, seeing that his return during the peak production period of the year is largely determined by the world’s parity. At that time he is exposed in the world’s markets to the competition of countries where standards of living and costs of production are on a materially lower scale than those obtaining in Australia. Great though the possibilities of the dairy industry are, and large as is the amount of money yearly distributed among the dairy farmers, the industry is declining. Dairying districts are being denuded of their population, which is migrating to the cities. The increase in the tariff will give these producers a chance to “make good “ and stem this flow to the cities. On the manufacturing side, it has been proved before the Tariff Board, beyond all doubt, that the industry is highly efficient. It is admitted that our herds and pastures could, with advantage, be improved. Buying bulls, improving pastures, providing fodder, and testing and culling cows all cost a lot of money. The farmer knows the advantages of such improvements. Simply .on account of the low price received in the past for his products, the average farmer could not find the money to do what he knows is required to improve his position and reduce his production costs. The higher tariff will give him the opportunity to save his industry and the means of improving his own lot. A consideration of all the circumstances of the case leads to the conclusion that, in proposing the increase of duty set out in the resolution, the Government is meeting the legitimate requirements of an industry on which a large proportion of the population depends for its living. While the increased duty will not entirely remove the disadvantages under which the industry suffers, it will at least contribute to that desirable end as far. as it is possible to do so by means of the tariff. I congratulate the Minister and the Government upon bringing down this proposal, and I trust that our best hopes for the dairying industry will be realized.
.- This duty is proposed on account of the importation of butter from New Zealand. I happened to be in that Dominion six or seven months ago, and in conversation with various persons, including dairy farmers, I found that on account of a good season they had decided to send butter to Sydney. Providence had so smiled on the dairying industry there that a large quantity of New Zealand butter - I believe no less than 600,000 boxes were on the London market - could not be disposed of, owing to the heavy supply of Danish and Swedish butter, which for many years has been placed on the London market. A million boxes of butter had been placed in cold storage in New Zealand, and it was decided to dispose of the surplus on the Australian market. The object of the proposed duty of 6d. per lb. is to prevent the people in one part of the Empire from getting the benefit of cheap butter produced in another part of the Empire. The Prime Minister is a champion at advocating reciprocal trade within the Empire; but, so soon as a surplus of butter occurs in New Zealand, the Government takes action to prevent the people from having the benefit of it. Australia is famous for its production of butter, and, therefore, it seems strange that I should have to pay 2s. 2d. and 2s. 3d. a lb. for this commodity, despite all the facilities afforded for cheap railway transit and road votes. The price is far too high.
– If there were no duty on clothing I could save money by obtaining my clothes from England; but I believe in protection, and, therefore, I purchase them in Australia.
– Before I have concluded my remarks, the honorable member for Capricornia will regret having made that interjection. The high cost of farming land is partly responsible for the present position of the dairy farmers. The honorable member for Moreton (Mr. J. Francis) admitted that fact when he pointed out that the dairymen had to pay dearly for their land, and were charged high rates of interest on their mortgages. Therefore we can hardly expect cheap butter. I should have been rather glad if I had been put on the land as a young man; instead of being employed in business in the City of Sydney I should now have such an income that I should be free from all financial anxieties. Those who make money out of the dairying industry are the agents who “ farm “ the farmers. I refer to firms like Goldsborough, Mort & Company and the agents that have offices in the city and in country towns. I do not suppose that £10,000 or £15,000 a year would meet the cost of upkeep of the palatial residences in which men like Mr. Niall live. They are the persons concerning whom inquiries should be made when the position of ‘ th« dairying industry is under review. Had the producers supported the Labour party in the past, they would not have so many people farming them as there are to-day. About two years ago, I visited the Grafton district, and was shown some of the farms there. I met one old fellow who had one of the most glorious spots on God’s earth. The scenery and surroundings were beautiful, and the cattle and sheep were in fine condition. Grass was there in abundance. I said to him, “ What do you do when you get up in the morning ?” He replied, “ I generally open the back door and look out, and praise God from whom all blessings flow.” There was no mortgage on the property, and the owner told me that he was fairly wealthy, and could write a cheque for a sum running into five, figures. That man’s position is typical of the lot of many others who have settled in farming districts. I am a protectionist, and I patronize Australian industries. I wear Australian-made hats and clothes. If every one in the community did the same, there would be no need to increase the tariff to protect primary industries, and the Minister for Trade and Customs would probably be out of a job. I have been a protectionist since 1874, when I first saw imported goods landed on the wharves of New Zealand. I came to Australia, and found the same conditions existing here. But there is something wrong with the methods of production when the butter industry requires assistance. The values of land are inflated, and interest charges are high. Public loans bearing interest at 4 per cent, are being converted at 5J per cent., and are being issued, not at face value, but at £98 10s. One would be a fool or a madman to think that this country can progress under such conditions. These gilt-edged securities kill other investment. A farmer who visited Sydney recently told me that he had to pay an interest rate of 9 per cent, on a loan of £1,500, which he needed to tide him over a drought period. The problem of the dairying industry will not be solved by increasing the duty on butter in order to prevent New Zealand butter from coming here, and destroying the demand for local butter. The community will be no better off under this increased protection. This Parliament was established to deal with national questions. Yet, this Government, like Nero, is fiddling while Rome is burning. Butter is sold in London at 152s. per cwt., and in Sydney and Melbourne at 273s. per cwt. Under the Paterson stabilizing scheme a bounty of 3d. per lb. is given to increase the London price from 152s. to 178s. per cwt. That is a very heavy burden for the people of Australia to carry, and the present position needs the serious consideration of honorable members. Their children can do without clothes and boots, but not without bread and butter. We are approaching a ridiculous position. When I was a young man, land suitable for dairying was sold at £1 per acre, but to-day its value is £110 per acre. Some one has made immense profits out of that land, and consumers, who are paying from 2s. to 2s. 6d. a lb. for butter, have certainly the worse end of the stick. While the cost of living increases, we cannot reduce wages. Honorable members have painted a gloomy picture of the dairying industry. A gentleman who has just returned to Australia from England, told me that it was deplorable to read in the English newspapers of the unsatisfactory position of Australia as a land of sand, sin and sorrow. It is no wonder that we cannot get the right type of immigrant to come to this country, and that we have to bring out boys who have little understanding of the conditions that they will have to face when they arrive here. If honorable members who represent the primary producers were not unduly pessimistic, we might be able to encourage suitable settlers to come to this country. I advise them to get rid of their sorrows and wailings, and to take a brighter view of the future of Australia. If dairying is not a success, it may be that the soil is unsuitable. The best soil in Australia is in the sugar cane-growing districts of Queensland. The Colonial Sugar Refining Company has established a laboratory, at which all classes of soil are tested. With the addition of essential quantities of lime and superphosphates, the soil in the sugar cane districts has been brought almost to the pitch of perfection. Why not apply these methods to the dairying industry? According to honorable members opposite it does not pay the farmers to produce butter, in fact, the raising of pigs and fowls is not a profitable venture. If that is so, there must be something radically wrong with our methods of production. We in Australia are behind every other nation in pest destruction. We have a soil that excels in quality that to be found in any other part of the world. William James Farrar lived on a four-acre block at Canberra and it was here that he conducted the experiments which revolutionized the culture of wheat and did much for humanity. Let us encourage others to follow his example.
– Does the honorable member approve of the 6d. per lb. duty which the Government has proposed to impose upon butter?
– I do not worry about that. That is a small matter. I trust that we shall not hear so much pessimistic talk in future. Let us deal with the matter in a practical way and endeavour to solve many of the problems which to-day remain unsolved.
.- I listened with interest to the statement of the Minister in which he described the trade relationship existing between New Zealand and Australia. I only regret that the honorable gentleman has not been able to arrange in advance for a quid pro quo in respect of this duty. I was a party to the institution of the original duty, which was arranged after consultation with representative dairymen. A provision was made entitling either party to denounce the arrangement, if desired, six months’ notice of denunciation having to be given. I hope that it will not be necessary for the Minister to denounce the treaty which was then made, but that, by a process of friendly bargaining between the two countries, an equitable adjustment may be made. I consider that it would even be worth while for one of the officers of the honorable gentleman’s department to go to New Zealand during the recess to discuss the matter. I should prefer that the Minister himself went, hut I know that he is exceptionally busy. New Zealand is very friendly towards us, and is particularly keen in its dairying activities. Its Minister for Customs and an experienced departmental officer came over to the mainland and spent a considerable time examining our indus tries, and we were able to arrive at a most cordial give-and-take arrangement. I should be sorry if that arrangement has to be abandoned, though I admit that either country has the undoubted right to revise such agreements when its economic conditions demand such a course. I support the Minister in the imposition of this, duty, in the hope that he will be able to arrive at a friendly arrangement with New Zealand under which the duty will come into operation forthwith. I listened to the honorable gentleman and other speakers, hoping that they would describe the effect of this duty and the peculiar circumstances of the industry which necessitatethe imposition of such a duty, but thesubject was not dealt with by them. It is well known that, for a certain portion of each year, Australia supplies not only its own butter requirements, but has a substantial exportable surplus. During the winter months Australia finds it less profitable to produce butter, and that is why the dairymen want this assistance from the Government. The Paterson scheme creates a peculiar anomaly. It makes Australia, during the time when our own producers cannot supply our demands, the best butter market in the world. That has been observed by New Zealand dairymen, who utilize the position to their advantage. I am in sympathy with the Australian dairymen who ask our legislature to assist them by imposing the proposed duty. The chief reason why they seek aid is that they may be assisted in the additional expense of producing butter during our dull winter months, and I hope that the duty will have that effect.
– Will the honorable member explain how the introduction of New Zealand butter during the slack months hurts the Australian dairymen?
– It takes his home subsidized market.
– But the Australian, market is then short-supplied.
– That is why it is, proposed to impose this duty, in order that we may have continuity of production. Continuity of supply is a dominant factor in winning and holding markets. It is during the period when one’s’ supplies are short that competitors obtain/’ the trade.
– Does the honorable member say that, during the winter months when production is low in Australia, this imposition will have the effect of keeping up the price of butter here?
– It will have the effect of increasing the price, so giving the producer a greater reward for supplying butter at a time when it is almost unprofitable to produce.
– Will the honorable member explain how it is that New Zea land is able to produce butter during the “winter months.
– I am unable to say exactly, except that New Zealand enjoys a more even climate and a longer butter season, and has a greater evenness of soil values than has Australia. New Zealand also concentrates to a greater extent on the butter industry. I do not say that this assistance will solve all our problems. Dairymen are faced with many other problems. Four or five years ago it was my privilege to make a survey of the dairying industry of Australia, and I had the good fortune to have the assistance of some of the most eminent men in the industry. The elect of the butter producers, of the manufacturers, and of the trading interests came together in a very commendable spirit, and together we established the Australian Dairy Council. That body made a survey of Australian dairying conditions, and dealt with every aspect connected with our great dairying industry. Many problems confronted us, not the least of which was the unevenness of climatic and soil conditions which prevail in Australia. Our inequality of soil values places us at a considerable disadvantage when competing with such countries as Denmark, New Zealand and Ireland, but, notwithstanding that, we produce some of the choicest butter in the world.
– We have now reached the stage when our average butter production is quite equal in quality to that of New Zealand.
– I think I may claim that I was responsible for laying down the standard which established the Kangaroo brand of butter. I had a good deal to do during my period of office with laying down the conditions which dairymen had to observe to market the
Kangaroo brand of butter, and I gave twelve months to the industry to equip itself to comply with the new conditions. New Zealand has more favorable climatic and other conditions than we have for the production of a uniform quality of butter, and the world knows it. As the Minister for Markets and Migration (Mr. Paterson) is aware, I have been apprehensive for some time of the effect of the British regulations, which are to be imposed next year, to prohibit the use of preservatives in Australian butter exported to England. I have on several occasions questioned him on this subject, but he has always made an evasive reply. It is regrettable that the situation is as we find it. Because of the great distances which our butter has to travel, the long time in which it must remain in refrigeration, and the different qualities of soil and climate which we have in Australia,, it is difficult for us to prevent our butter from deteriorating. On’ the 24th November last, the following comment on this subject appeared in a London newspaper : -
Importers are complaining regarding tlie quality of several brands of Victorian unsalted butter which arrived in the Jervis Bay. These butters are graded as ,: Kangaroo,” but importers consider they are only second grade.
Mr. Crowe, one of the most eminent butter experts in Victoria, also referred to this matter some little time ago. The Australian dairymen are faced with the gravest difficulty in placing their choicest unsalted butter upon the breakfast-table of the British consumer, and anything that we can do to help them to achieve tha t end should be done. We have £240,000,000 invested in the dairying business in Australia, and it is one of the best organized of our rural industries. I trust that the Minister for Markets and Migration intends to do something more to benefit the industry than merely to provide temporary assistance during certain periods in the year. This proposal will not- be of very great benefit to the dairymen, but it will help them over the unsound economic period through which we are passing. Under present conditions there is no clear money in this industry for our dairymen, notwithstanding that they employ family labour, work longer hours than any other wage-earners or producers in Australia, and carry on their operations without a break through the full 365 days of the year. I do not quite see how the benefits of this increased duty will reach the individual dairyman. It is true, of course, that 90 per cent, of the Australian output of butter is controlled and distributed by the dairymen’s cooperative organizations; but that will not prevent the astute trader, who knows how stocks are held in Australia, and how world stocks are diminishing, from making contracts which will be profitable to him. I feel disposed to believe, however, that the traders will benefit more at the expense of the New Zealand than the Australian dairymen. Their purchases are likely to be made on more advantageous terms in New Zealand than in Australia.]
– I think that the honorable member is wrong.
– That may be so. but it is my opinion. Seeing that the Australian dairymen’s co-operative organizations control the major portion of our production of butter, it should be able to some extent to limit the operations of private speculators. In my opinion, the Australian dairying industry needs a thorough overhaul. I have more faith in fundamental improvements in the industry than in subsidies of this description. Matters of vital concern to the success of the industry are a proper selection of soil, healthy stock, scientific research, and the education in the best scientific methods of production of the men engaged in the industry. Periodical subsidies of the kind now under consideration are helpful to tide us over abnormal times, but they are not a solution of our difficulties. The industry can only endure if it is built on a sound basis. I invite the Government to enter upon an educative campaign among dairymen. I suggest that scientists and experts from Denmark, which is famous for its butter production and education, should be brought to Australia to assist our dairy industry. These men know what is necessary, and they could give us invaluable advice. We have discovered how easily our choicest butters can deteriorate. The mere fact that the use of preservatives has been prohibited by Great Britain has caused some of our choicest unsalted butter to fall from a first-grade to a second-grade product.
– That is only a small portion of the unsalted butter, and the difficulty appears to have been overcome.
– By what means?
– By an alteration in factory technique. This discovery has been made only within the last week or so.
– It is a great pity that the Minister did not make a definite statement to that effect before we embarked upon this discussion. The present position is most disquieting. Conditions of production have made it necessary ta use preservatives in many districts, and itappears to me that we shall be in an extremely unfortunate position if wehave to cease using them. The honorable member for Darwin (Mr. Bell),, apparently, disagrees with certain of my remarks ; but he lives in Tasmania, which has a cold climate that -may be compared with that of New Zealand, which renders unnecessary the use of preservatives. In warm climates, which contain some of the finest dairying country in Australia, the use of preservatives has so far been essential. Sir Philip Proctor, who was Food Controller for Great Britain subsequently to Lord Rhondda, made a statement on one occasion that our choicest unsalted Western District butter was the best he had ever tasted. Unfortunately, the acidity of the soil in some districts, and the long distance which our butter has to be carried to the markets abroad, make it necessary for us to use preservatives in it. I shall support the imposition of this duty, for I believe that it will be of temporary assistance to the industry; but’ I trust that the Government will give earnest consideration to my suggestion for the carrying on of .an educational campaign among our dairymen.
.- As this is a proposal to protect an Australian industry, I shall support it. It has been said that the increased duty will lead to an increase in the price of butter to our’ consumers; but I think that it will have very little effect in that way.
– Then what is the use.of the duty?
– About one-third of our production of butter has to be exported; but there is a period in the year> when the southern parts of Australia are not able to produce all the butter they require, and look to the northern parts of the continent to meet their needs. It is at that stage that New Zealand butter is placed on the Australian market to the detriment of the butter produced in Queensland and northern New South Wales. Last year and the year before that, our producers in those districts were obliged, on account of the New Zealand competition, to export their surplus production at a less payable price than could otherwise be obtained on the local market. If there is anything in our protective policy, we should surely be able to preserve the Australian market for the Australian producers. The imposition of this duty will prevent New Zealand butter from entering into competition with our northern butter, when supplies in the southern part of the Commonwealth are scarce. Honorable members of this chamber who advocate the freetrade policy, describe the imposition of such a duty as this as an artificial aid to industry; but I disagree with them. I submit that we are entitled to protect our producers from competition, from outside. If we insist upon a basic wage, and the observance of a certain standard of living for persons engaged in our secondary industries - and I stand foursquare by that policy - we must also extend protection to those engaged in other industries, whether as wage-earners or producers. ‘ The people who work on dairy farms are subject to severe competition and the earnings of many of them are below the basic wage. They are entitled to have their standard of living raised, at least so far as that can be done by assuring to them a fair price on the home market. Australia is in a difficult position. The balance of trade is against us and we must produce those things for which there is a market abroad. For wool and wheat we can find a profitable market. For butter also there is a market, but rarely is it profitable to the producer; he is forced to sell his surplus abroad at whatever price he can get and usually receives in the home market no better price than the world’s parity. There comes a period of the year when, because of climatic conditions, there is a shortage of butter in certain portions of Australia.
That is the opportunity for the dairy farmers in warmer climates to send their butter south, but at that season another country places its butter on the market and forces the local product overseas. The honorable member for Fremantle (Mr. Watson) spoke of speculators in butter. There are speculators in butter as in everything else, and if the honorable member and others who support him would assist us, and if the people of Australia would give us the constitutional “ authority, we would deal with all those persons who speculate in butter or any of the other necessaries of life. For the time being, we must take tilings as we find them, and the little inquiry I have made into the subject has satisfied me that the importation of butter from New Zealand was controlled by manipulators, gave no advantage to the consumers, and operated detrimentally to the Australian producers. The imports were a weapon held over the producers by the speculators who wanted their supplies. The honorable member for Fremantle knows that the speculators do operate in that way. They so manipulated the market that they were able to export Australian butter and replenish the local market by importations from New Zealand.
– To standardize the price.
– Yes; and the ability to import from New Zealand increased the opportunity for the manipulator. By exporting a large amount of Australian butter and importing supplies from New Zealand they have a bigger turnover than they otherwise would have. They are also upsetting the dairying industry in the southern States and destroying the chance of producers in the northern States to get their butter on the Melbourne and Sydney markets at a period when their maximum production coincides with the minimum production in the southern States. Some honorable members ask “Are we to continue for ever building up Queensland with an embargo on sugar and bananas and a high duty on butter ?” To that question, I as an Australian reply that Queensland is a good customer to the southern States, and in exchange for the manufactured products she buys from us, we take her raw materials and primary products. I would like people to get rid of the idea that we are spoonfeeding Queensland when we place an embargo on foreign sugar and bananas Queensland is doing more than any other State to maintain the balance of trade. Whilst we take its butter in the season when we cannot produce it, Queensland takes our goods all the year round. If one is to be an Australian protectionist, he must be consistent. We have twitted some honorable members who claim to be the special representatives of country interests, that whilst they ask for protective duties on primary products, they be grudge similar assistance to the secondary industries. I do not take that stand. I say we should protect Australian indus-try, whether primary” or secondary. Butter is one of our primary and staple products, and we should see that the market is preserved for the local article by whatever protective duties are necessary. The honorable member for Wannon (Mr. Rodgers ) made an important point which I may with advantage repeat. There is a period of the year when the southern States do not produce butter in sufficient quantities to supply their own people, and when even the butter from Queensland does not satisfy ‘the market. But surely we should encourage our people to incur the extra expense of producing butter in the winter. The cost of production in the cold months is higher and the dairy farmer is entitled to a correspondingly higher reward for his labour. If a manufacturer has to pay higher wages, we recognize that the cost of production is increased and we give him greater protection. Similarly, if we ask the dairymen in the southern States to produce more butter at a season when hand feeding and other extra labour are involved - if we ask them to supply us with fresh butter all the year round - surely we should be prepared to recompense them for the extra cost and labour. The proposal to increase the duty by 3d. petlb. does not mean that the price of all butter will rise to that extent. The duty will apply only in that season when butter is imported, and as the annual imports are only a fraction of the total cmsumption, the consumer will not be seriously affected. When we are asking the producers to supply the local market and increase the wealth of this country we should allow them an extra margin of profit. If there be any foundation for the argument that a duty must be resisted because it will increase the cost to the consumer, we should remove the duty on boots. But, representing a constituency in which are many boot factories, I stand for high duties on boots, and as I claim protection for them, so am I willing to give. protection to other industries. I realize that the manufacturers in my electorate find a market for their products amongst the primary producers, and the primary producers in turn find a market for their products amongst the operatives in the factories. Australian prosperity can only be built upon a wide and deep foundation. The true foundation is primary production, upon which we should build up a super-structure of secondary industries; and when both primary and secondary producers are thriving, each proving the complement of the other, we shall have a prosperous nation.
.- I rise mainly to refute the erroneous impression that might have been created by the remarks of the honorable member for Fremantle. I may confidently leave to the common sense of the committee the protection of the dairying industry. The Tariff Board, after exhaustive inquiries throughout the dairying districts, unanimously recommended that an increased duty should be imposed on butter and cheese. It has been said that the dairymen are the poorest and most sweated body of men in Australia. I know that to be true. The difference between the honorable member for Fremantle and myself is that he is a speculator, whilst I am, and have been for the last twenty years, a dairyman. The honorable member referred to the Dairy Produce Export Control Board as the representatives of joint stock trading companies, and said that proprietary companies were controlling the products of the dairy farmers. That was a most unfair and untrue statement, and I am surprised that an honorable member of his character and wide business experience should have made such an assertion without being sure of his facts.
– I am.
– The Dairy Produce Export Control Board comprises ten representatives of the co-operative butter and cheese factories, and two representatives of the proprietary butter and cheese factories in the Commonwealth. The ten co-operative representatives were elected by the directors of the co-operative butter factories, and truly represent the cooperative interests in the control and distribution of butter supplies. They are- Victoria, Mr. A. W. Wilson, of Gippsland North, and Mr. H. W. Osborne, of the Western District; New South Wales, Messrs. W. S. Clifford and C. E. D. Meares; Queensland, Messrs. T. F.. Plunket and H. F. Walker; South Australia, Mr. E. H. Froman : Western Australia, Mr. W. R. Clarke; Tasmania, Mr. H. E. Fowell. When the Dairy Produce Export Control Bill was before the House, the suggestion was made that direct representation should be given to the suppliers; but the representatives of the industry throughout Australasia thought that, that method would be too costly, and that representatives elected by the co-operative factories would be better. That system has proved entirely satisfactory to all interests concerned. The representatives of the proprietary factories are Messrs. H. H. Handbury and P. J. Holdenson. They also represent the dairymen and are giving satisfaction, as is proved by the fact that the proprietary concerns with which they are connected are supplied with milk and cream by the dairymen. If they were not giving satisfaction the dairymen would glV their supplies to co-operative establishments. Messrs. Handbury and Holdenson may be justly claimed to be direct representatives of the suppliers. The agents or persons engaged as sellers’ of dairy produce out of the Commonwealth are represented on the board by Mr. C. Wilson, and the representative of the Commonwealth Government is Mr. C. McPherson, C.B.E. The London agency is presided over by Sir James Cooper and his fellow directors are Messrs, J. R. King and 0. G. Norton. I have a copy of a report from Mr. Alec Wilson, who recently returned from London, in which he pays a high tribute to the work of the London agency, and the most efficient organization they have brought about. They are working in with the proprietary companies and with Tooley-street, and with the aid of the Kangaroo brand are putting Australian butter on the map. Great credit is due to Senator Massy Greene for having initiated this organization. His efforts have been well supported by the honor-, able member for Wannon (Mr. Rodgers), Mr. Wilson, and the present Minister for Markets and Migration (Mr. Paterson). They have done much to build up and maintain the dairying industry which produces about £45,000,000 worth of butter, cheese, milk, and- exports £10,000,000 worth of butter and cheese. In this discussion there is more at stake than the mere increase of 3d. per lb. in duty. We are dealing with a great industry that must, continue and expand, and help Australia to meet its liabilities: Dairying stands about third on the list of Australia’s big national industries, and is worthy of every support. I am sorry that the honorable member for Fremantle made disparaging remarks about the industry. A certain amount of statutory power has been given in regard to export, and a general marketing policy, which is respected throughout the British Empire, has been evolved. It is unfortunate for the industry that at one time consignments of butter that was not fit for greasing axles were sent abroad. These practically ruined the good name of the Australian article.- At that time the “ Kangaroo “ brand was unknown ; but now no person can export a single pound of butter without a licence, and a good check is provided against unscrupulous speculators, who, at various times, have ruined the market for Australia in not only butter, but also meat and fruit. The Prime Minister told the producers that, if they put their own house in order, the Government would come to their assistance. True to its pledge, it has given sympathetic aid to the dairying, as well as other primary industries. I approach this matter from the widest Australian view-point. I have given the best years of my life to the dairying industry, and I wish to leave it better for those who come after me. By proper organization, the dairymen are now saving £1 per ton with respect to freight, which amounts to upwards of £60,000 a year. Owing to the huge quantities of butter that are handled by the Export Control Board, the shipping companies are willing to grant more favorable freights than they would if the -dairymen had to negotiate for the carriage of smaller cargoes. On marine insurance alone the industry saves £20,000 a year by dealing with the business in bulk. The charge levied on the industry by the Export Control Board amounts only to onetwentieth of a penny per pound, out of which £12,000 a year is used for advertising purposes. That sum is subsidized by the Commonwealth by a further £12,000. To Senator Greene, the honorable member for Wannon (Mr. Rodgers), ex-Senator Sir Victor Wilson, the Minister for Markets and Migration (Mr. Paterson), and to the governments with which they were associated, the dairying industry is under a great debt of gratitude, although I believe that it is entitled to even far more ‘ than it has received. By means of wise organization, the industry has been placed on a firm footing, and, therefore^ it has proved the justice of its cause. I leave the amount of duty to be imposed to the good judgment of the committee. The great majority of commonsense men will realize the need for amply protecting this Australian industry. The Minister explained the case for the duty fairly well. He pointed out that we have a reciprocal arrangement with New Zealand, and he advised the committee to act cautiously. We have done more for the dairying industry during the past four or five years than ever before. The Government established a rural credits branch of the Commonwealth Bank, and prior to the opening sales in London last year this was the means, owing to the movements of certain speculators, of saving the industry anything up to £3,000,000.
– As I do not represent any dairy-farmers I have to be guided by the opinions I hear expressed in this chamber, and the speeches delivered this afternoon are certainly somewhat confusing. We were informed by the honorable member for Fremantle (Mr. Watson) that Australia produces more butter than it consumes, and that it is a large exporter. But we also know that we are now importing butter from New Zealand. We are told that in winter butter is scarce. The New Zealand winter corresponds to that of Australia, and, if butter is scarce in . the dominion in winter, there should also be a shortage in Australia. When butter was dear in New South Wales, a man employed in cold stores in that State told me that thousands of boxes of butter were on hand and were liberated only in certain quantities daily in order to keep up the price. While it was said that butter was scarce, this commodity was being exported in wholesale quantities to other parts of the Empire. I am afraid that the duty will not assist farmers, although I believe that they are entitled to any assistance that we can possibly give them. The proposed duty will simply play into the hands of the speculators who desire to exploit the dairymen and the general public. Why should we be asked to beware of competition from New Zealand butter? New Zealand is not a low-wage country.
– The hours of employment in the New Zealand butter factories are 70 hours a week, and the men work for about two-thirds of the wages paid in Australia.
– But the men on the dairy farms in Australia also work 70 hours a week. We should have regard to the claims of the general public. Have the consumers no right to consideration ? The Government has made no provision for them. An expert control board has been appointed. Why does it allow butter to be exported when there is a shortage in Australia ?
– But the duty will make the speculator pay more. If I advocate protection for secondary industries I must
De consistent and advocate it also for primary industries.
– But why should we export butter if it creates a local shortage? I believe in assisting the dairy farmers to the utmost of our power; but control over export should be exercised so that the consumer would be protected, and would not be compelled to pay the high prices now ruling. A good many years ago men were hanged for no greater offence than holding up the food supply of the people; but now that is done with impunity.
– If the duty on butter were decreased, the speculator would bring more imported butter here.
– I am not satisfied with the Government’s proposal. I think that we should assist industries, but not to the extent proposed under this item.
– I have listened to the various arguments for and against the proposed duty on butter, and have given a great deal of study to the dairying industry. Recently I attended a most interesting lecture by Dr. Richardson, of the Waite. Institute, Adelaide. That gentleman recently attended an Empire conference of scientists at the invitation of and as the representative of the Commonwealth Government. Dr. Richardson knows more about the scientific development of that industry than perhaps any other man in Australia, and he gave us a most interesting account of the strides that had been made in the dairying industry of Denmark. He said that when the first German Empire took Schleswig-Holstein from Denmark, it was left with a small area of unattractive country, and the Danes in order to exist had to explore every possible avenue to obtain greater production from the soil. They brought dairying and the use of land to such a fine art that at present, except where land is actually occupied by buildings, not one single acre in the whole of that country is lying idle. Dr. Richardson also mentioned that as the result of scientific research there, the production per cow and the capacity of the land for the growing of fodder had greatly increased. The Danes did not stop at that, but concentrated on the perfecting of their butter, and they brought production to such a stage that to-day their butter is unequalled in quality in the markets of the world. That is what we are aiming at in Australia, and the dairying industry is now being investigated by our scientists. I believe that there is a great future for the industry. Honorable members who are aware of the conditions of dairying will agree that if there is a sweated industry in Australia that industry is the dairying in dustry. The dairymen have to work every day of the week from early morning to late at night. Their wives and children have to assist in the work, and the children in many cases have to rise early to work on cold, wet, wintry mornings, or on summer mornings that are succeeded by blazing hot days, and then plod their way wearily but not unwillingly to school, only to return in the afternoon to commence work again. I have voted against duties when I have considered them unwarranted; but a moderate protectionist, such as I am, should hot do otherwise than vote for the increased duty on butter. It is a mere bagatelle compared with duties which afford a protection of 200 per cent. I honestly believe that the duty would not affect the price of butter to any great extent. In any case it would soon be in the same category as the duty on wheat, which is a duty in name only, and is rarely imposed. The dairymen, assisted by the scientists, are falling in with the policy of the Commonwealth Government to bring about better methods of production, and I suggest that many of our secondary industries should put their house in order before asking this Parliament for increased protection. The dairymen are trying to help themselves, and all honour is due to them for their initiative. If the honorable member for South Sydney (Mr. E. Riley) would visit the dairying districts, and see the conditions under which the dairymen are working, I am sure he would open his generous heart and vote for the increased duty in order to protect an industry which at present, is the most sweated in Australia.
.- In common with many representatives of dairying districts, I have from time to time made representations to the Minister for Trade and Customs, and also to the Government, in order that some method might be found of preventing the large importations of butter that have been flowing into Australia during recent years. I do not wonder at the honorable member for South Sydney (Mr. E. Riley) being surprised that a duty is necessary when one considers the wonderful climatic conditions of the Commonwealth, and it seems remarkable that we cannot produce butter at a price that would enable us to compete successfully with New Zealand. The fact remains that we cannot. The Tariff Board has fully inquired into the industry, and it is no news for it to tell us that the condition of the dairying industry is exceedingly bad, and that some remedy is necessary. My sympathy is with the Minister in facing this problem, because it does seem unfortunate that we should need to ask the New Zealand Government to alter the agreement that it has entered into with us. I can quite understand that only after mature consideration has tHe Minister decided to approach the New Zealand Government; and I should not be greatly surprised if that Government insists on adhering to the letter of the agreement, and requires six months’ notice to be given of the intention to amend it.
– If that happens what will be the result?
– The proposed duty would probably be deferred for six months. I do not suppose that the Minister would break the letter of the agreement against the wishes of New Zealand.
– There should he honour even amongst thieves.
– The dairymen of Australia have a real complaint, considering that in 1925-26 no less than 2,978,568 -lb. of butter, valued at £245,940, were imported into Australia from New Zealand. Butter was certainly imported from other parts of the world, but it must be admitted that New Zealand is our chief competitor. The question that we naturally have to ask ourselves is whether the industry in Australia is worthy of protection. The statistics show that there are engaged in the industry 89,760 males, and 54,025 females, or 143,785 in all. I feel certain that the honorable member for South Sydney would not suggest for a moment that the proprietors of our secondary industries should work their wives and families in their factories, and I am surprised that he spoke on the lines that he did this afternoon. T.he fact that it is necessary for the farmer to have the assistance of his family in order to obtain a bare living, shows that the industry is certainly in need of . some protection, and that can be most appropriately given through the tariff. The number of employees engaged in butter factories in Australia is 5,826, the wages paid being £1,287,689. There are 600 factories, of which 127 are in Queensland, and of those 90 per cent, are cooperative concerns. I have not been able to find out the proportion of co-operative factories in the other States. It seems to me that the dairymen of Australia should work more on the lines of co-operation, so that they can reap more, if not the whole, of the profits from the industry. We have our droughts and- good seasons, and we should ask ourselves whether the dairy farmer is to be called on to bear the whole brunt of misfortunes which no one can foresee oi* adequately provide against. If we believe in the law of supply and demand, we must be prepared to shoulder some of the burdens of unfortunate industries that are affected by droughts and gluts. I am glad to be able to say that the dairymen of Australia have endeavoured to help themselves. We have what is known as the Dairy Produce Export Control Board, and delegates from the various States meet periodically in one of the capital cities, when the whole matter of supply and demand is discussed. As honorable members have said, it seems peculiar that we should export butter, and then have a shortage which necessitates the importation of butter from New Zealand. According to the Tariff Board’s report, the exportation of Australian butter for the last five years for which statistics are available is as follows: -
Surely, if we are able to export that quantity of butter each year, means can be devised whereby a sufficient quantity may be retained in Australia to supply local requirements. The Dairy Produce Export Control Board have the matter in hand, and no doubt will evolve a satisfactory course of action. Only recently the Queensland Government, finished the building of a very large cold store which will enable that State to hold sufficient butter to meet winter requirements, when production is inadequate to meet demands. No doubt the public may be safeguarded in other States in a similar manner. Unfortunately, a certain amount of friction and jealousy still prevails amongst the States, Last year Queensland enjoyed a good season and produced sufficient butter to assist the other States; but, for some reason, those States chose to import New Zealand butter. That really originated the demand for an increased duty. This duty is necessary, not so much to give dairymen an increased price, as to prevent speculators and importers holding supplies in order to reap huge profits. This duty should overcome that difficulty to a great extent. I do not think that any one would contend seriously that the dairyman is not deserving of assistance. The fact that he has to utilize the services of his wife and children is rather a reflection on the industrial life of Australia. It is true, that those people perform the work willingly, but if the industry were established on a proper basis, the farmer would be able to employ outside assistance, which would obviate the necessity to subject his family to such drudgery. In order to prove in what poor circumstances the average dairyman is placed, I mention that, during the last financial year, only 321 of the 22,219 dairy farmers in Queensland paid income tax, and their average assessment was the low amount of £8 13s. 5d. Norco Limited, of Byron Bay, last year had 3,000 suppliers, and the average, amount paid to each was £4S6. The report of the Tariff Board gives detailed examples of the difficulties experienced by the dairy-farmer in making a living for his family.
– That amount sometimes represents the wages paid to the whole family.
– Page 4 of the report of the Tariff Board instances a man who gave his estimated expenses for the year as £669, and his receipts at £708 5s., leaving a balance of £39 15s. One would imagine that it would be impossible for a man and his family to exist on that amount, though, of course, interest on capital is allowed for. The majority of these people are often compelled to keep their families from their capital rather than on what they make from the farm. One does not like to paint a sorrowful tale about any Australian industry, but for many years dairying has been one of the worst paying of our Australian industries. If I thought that the proposed duty would merely help the speculators and importers who live about the cities, I should oppose it. It is only because I believe that it will benefit our farmers that I support it. Statistics show that the manufacturing and selling costs of butter amount to from 2.42d. to 4.28d. per lb., which is not extravagant. The farmer receives an average of ls. 3d. per lb. for his product and it is contended that he should receive at least ls. 9d. per lb. There are many paragraphs in the last report of the Tariff Board which must compel most honorable members to conclude that the industry deserves consideration. At page 8 the report reads -
The whole of the evidence tended to show that the butter industry is in a stagnant and unpayable condition, and without exception witness after witness described the lot of the dairy farmer as a constant struggle to make ends meet, and that it was only possible to continue in the industry by utilizing the labour of the wife and family of the dairyman and working unduly long hours. Where labour is employed, it is undoubted that it is paid extremely low wages,- and even under the above conditions, it was maintained on all sides that the dairy farm hardly paid its way, and did not give anything like a fair and adequate return to the dairy farmer.
I feel certain that the members of the Tariff Board are not fools, and that when they make such statements they do so after very careful deliberation. Our dairy farmers can, and should, help their own industry, first by co-operation, and secondly, by taking advantage of the herdtesting facilities offered to them. It is easy to contend that it is cheaper to milk one good cow than two indifferent cows, but most farmers have Hobson’s choice when it comes to selecting a herd. They usually are compelled to choose quality within the bounds of their purse. Both the States and the Commonwealth have endeavoured to help the dairy farmer by granting financial assistance for the testing of dairy herds. In answer to a question the Minister for Markets and Migration stated that £7,000 was expended in the various States on herdtesting during the last twelve months.
I hope that that policy will be extended, as it is capable of giving excellent results. There are magnificent pastures throughout Australia, but it is necessary that only suitably bred cattle should be selected for dairying purposes. The dairying industry is estimated to be wor th £20,000,000 to the Commonwealth, annually, showing that it is an industry of considerable importance, and I am sure that this chamber is not wasting its time in granting it assistance in the imposition of customs duties against all competitors. I feel confident that Parliament will agree to the proposal of the Minister for Trade and Customs.
.- The majority of honorable members must be gratified by the intention of the Minister and the Government to cause this duty to take effect as soon as is practicable. I have had a long experience in the dairying industry in the Wide Bay and Burnett districts of Queensland, an experience extending back to a time prior to the erection of the first butter factory in Wide Bay. I assisted in the construction of the first factory in Maryborough. While the major portion of the land used for dairying purposes in the Wide Bay and Burnett districts is good, the majority of those engaged in the industry had very little money to start with, and very little experience. They had to gain their experience as they proceeded, and to acquire a breed of cattle best suited for milk production. In many cases it has been a difficult and slow task. Now those people are working in the right direction, but most of them have spent their money in the endeavour to build up the right type of herd, to grow the proper fodder, and to improve their land. Theirs has been an uphill task, and they deserve our sympathy and support. I could not understand the statement of the honorable member for South Sydney (Mr. E. Riley) to the effect that the dairying industry has not assisted our secondary industries. The dairying industry has very greatly assisted our secondary industries, particularly in Sydney and Melbourne, from which centres most of the machinery necessary for dairying purposes is obtained. The dairying industry has reached tremendous proportions in
Queensland. ‘ We have 429,120,000 acres of land in that State, much of it suitable for dairying purposes, and if proper herds are acquired and the correct fodder cultivated, excellent results must follow. The dairying industry is growing rapidly in Queensland, but at present the only way to engage in it profitably is to associate with it the growing of some product such as maize, peanuts, &c. We have several other minor industries which could be associated with dairying. Every unbiased person who travels through the division of Wide Bay must conclude that the dairy farmers there deserve every protection and some compensation for the hardships through which they have passed. I feel sure that every right thinking member of the committee will approve of the proposed increase in the duty to assist the dairy farmers.
.- I do not wish to give a silent vote on this item. I believe that the dairying industry is entitled to our sympathetic consideration. For a number of years I represented a division which had a large number of butter and cheese factories and many dairy farmers in it. There can be no question but that these people live a life of drudgery. Even their children are constantly employed. It would be inexcusable for us to allow New Zealand butter to continue to be imported into Australia to the detriment of our own industry. It has been said during this and other tariff debates that the home market is the most profitable for our producers, and I agree with the statement. I do not admit that this proposed increase in duty will necessarily increase the price of butter to the consumer. I could, if time permitted, give a number of instances which have come under my notice during the last twelve or eighteen months of material price reductions following upon increases in our protective duties. It may even happen that the price of butter will fall after the imposition of this duty. However that may be, our home markets should be preserved for our local producers. I believe in the fostering of both our primary and secondary industries. The two must be developed side by side, for the success of the one depends upon the success of the
Other. Our secondary industries provide employment for thousands of people, and these in turn create a market for the products of our primary producers. It will he ridiculous for us to spend £34,000,000 upon the encouragement of migration to Australia, if at the same time we neglect to stimulate our primary industries. It has been said that the imposition of this increased duty will chiefly benefit speculators; but no justification for that statement has been advanced. Even if the speculators did reap some advantage from it we should not be justified in regarding that as a reason for not affording our dairy farmers adequate protection. Speculation, as everybody knows, goes on in practically every industry. Nearly 150,000 persons are employed in dairying in Australia, and they have a legitimate claim upon our sympathy. It has been said also that this increase in duty should not be approved because it will adversely affect the sister Dominion of New Zealand ; but that does not weigh with me. New Zealand looks after the interests of her primary producers, and we should look after the interests of ours. Speculators in the past have bought New Zealand butter and sent it to Australia to compete on our markets with locally produced butter, with the result that our own dairy farmers have had to export their products to the markets of the world at a lower price than that which prevailed in Australia. That is not as it should be. I am quite convinced that if the distribution of dairy produce were organized on a co-operative basis, retail prices would be reduced and the dairy farmers would receive a better return -than hitherto for their products. A visitor from Great Britain, with whom I had the honour of lunching to-day, stated in the course of a speech which he delivered, that we should be able to absorb in Australia a larger number of British migrants, for we have the land upon which to settle them. But I submit that it is essential for us to make provision for migrants before we can settle them. We have a comparatively small population in Australia to-day because our legislation has not been passed with the object of absorbing migrants. An increase in the duty on butter will slightly improve our position in that respect, for it will lead to a greater development of the dairying industry, and so to the employment of more people in it. We ought surely to be able to hold 100 per cent, of the local butter market. If, after meeting our own needs, we have .an exportable surplus so much the better for us. I can see no reason why we should not export butter and cheese as we export wool and wheat; but our first step towards the placing of the industry upon a substantial footing is to obtain for it the local market.
.- I intended when I addressed the committee earlier in the afternoon to move an amendment. I move -
That the item be amended by adding the following words to sub-item a, “ and on and after the 14th December, 1927, per lb. British 3d., intermediate 3d., general 3d.”
I suggest to the Government that the interests of the dairy-farmers would be protected more effectively if a bounty were provided for the production of cream. It appears to me to be undesirable that we should increase the duty on butter to the detriment of our sister dominion with which we are competitors for nine months of the year on the world’s market. In my earlier speech I pointed out that the effect of the proposal of the Government would be to increase the margin between the price of Australian and New Zealand butter to about 8d. per lb., which would open the door for a considerable amount of speculation. I’ have no desire to penalize the dairymen, but rather wish to assist them. During the debate on this item I have been accused of many things. It has been said that I am a speculator. I admit that I have been one. It has also been said that I am untruthful. The statement is made in Holy Writ that all men are liars, and I suppose that to a certain extent we are ; so I may have to admit the justice of the second impeachment. But I ask whether a single member of the committee can truthfully deny that one effect of an increase in this duty must be to make butter more expensive for the workers?
– -Not to the workers only; but to every consumer of butter.
– To the workers principally, for they are the largest consumers and are least able to pay a higher price for it. Increase the income tax, or take almost any other step than this, to add to our revenue; but do not penalize the workers. I am an employer of labour, and not a Labour representative. “It has been said that I am an exploiter. I suppose that all men have been exploiters to some extent, but I point out to honorable members that I represent a Labour constituency in which I have lived for 32 years. The workers there do not regard me as an exploiter, or they would hardly send me here to represent them. Can any honorable member deny that in 1925-26, 60,000 boxes of New Zealand butter were imported to Australia while 93,000 boxes of our own fresh butter were exported to other parts of the world at the same time and sold for at least 6d. per lb. less than we were paying for New Zealand butter? That kind of thing does not benefit the dairyman, because he only received the overseas parity price for his cream. Why was the New Zealand butter imported? It was done purely to fix a price standard for local butter that was held in storage. I admit that my firm benefited by that business; but can any honorable member deny that the members of the Dairy Control Board were at once the biggest importers of New Zealand butter, and the biggest exporters of Australian butter, during the period under notice? It cannot be denied, because it is true. The effect of the duty will be this: The dealers will store so much butter during the season, probably 300,000 cases, to be ready for a shortage in the winter. It could be stored in Australia to-day at l72s. a cwt. As winter approaches this butter will be cleared, and a judicious shortage created. Then some New Zea-‘ land butter will be imported to standardize prices at New Zealand landed cost, but probably not more than a few thousand cases. Naturally that puts the money right into the pockets of the speculators. They will pay 6d. per lb. more to import New Zealand butter in order to force up the price of the stored.
– Then imported butter increases the price of butter.
– Of course it does. The honorable member for Wannon (Mr. Rodgers) suggested a means for helping the dairy farmer, namely, to improve the herds, bring down the cost of production, and to give him a subsidy straight out on his produce. I suggest that 1 1/2 d. a lb. would be a sufficient subsidy. This would give him’ a chance to carry on until he could get suitable stock. Our return in Australia at the present time is only approximately 2f lb. a cow a week, whereas it should be nearer 6 lb. I am prepared to pay any tax to help the farmer, but I am not willing to support a proposal like this, which will simply play into the hands of the speculators, and not give enough of the increase to the farmers. The money will go out of the wrong pockets, and into the wrong pockets. That is my objection to the proposal. I care not should nobody support the amendment but myself. I am satisfied that it is right. In doing this I am speaking against my own interests. I know that my own firm will give me “ beans “ over this. It will say, “ Here was an opportunity of making thousands.” Moreover, the men of whom I have spoken, the members of the Control Board, are my own friends. I wish to remain their friend, but they now occupy an anomalous position. Nobody should be allowed to control prices. I would not trust my own brother to do it, and I shall not trust any speculators to do it. I move this amendment in the hope that the Government will assist the dairymen by a direct subsidy which will go straight into the pockets of the farmers.
.- I was very much struck by the remarks of the honorable member for Fremantle, because I know he is engaged in this business, and has had more experience in the retailing of butter, and in the wholesale purchase of it, than any other member of this committee. If I thought that the Government was prepared to grant the subsidy I should support it, but I am afraid it will not consider the suggestion for a. moment.
– Why not?
– If the honorable member can obtain an assurance from the Government that a subsidy of 1-kl. per lb. will be paid, I shall be very pleased to vote for it because I am satisfied that it is the better way of helping the producers. I believe what the honorable member for Fremantle (Mr. “Watson) said about the creation of a scarcity when New Zealand butter was used to manipulate the market. I believe that, so as far as Western Australia is concerned, the protectionist policy is not beneficial. We have had inquiries and royal commis-sions to consider ways and means of assisting industry in that State. There is, for instance, the suggested subsidy to the gold-mining industry, which requires help just as much as does the butter industry. The position I am placed in is this: if the protectionist policy is the policy of this country, and if no manufacture can be started in Australia with a reasonable chance of establishing itself without first securing adequate protection, I do not see w,hy the primary industries should not also be assisted. I am therefore going to vote for this proposal, though I recognize that it is not as good as a direct subsidy. I believe what the honorable member for Fremantle said regarding the exploitation of the local market, but I believe also that if it were possible to keep out New Zealand butter, the chances of “rigging” the market would be greatly reduced. The honorable member for Indi (Mr. Cook) told us the other day that high wages were crushing the industry. He said that the dairying industry was in. a bad way, and that the high wages being_ paid were responsible for it. Unfortunately for him, almost or. the heels of his remarks came the report of the Tariff Board, which set out the wages paid in this industry. It stated that most of the hands employed in some of the districts were new arrivals who received wages varying from 25s. to 40s. a week and their keep. No man, it said, received more than £2 a week and keep. I think honorable members will agree that such wages are sufficiently low to suit any industry that should be permitted to survive. The present condition of the industry is not due to high wages. The report also contains statements from other sources, including one by Mr. T. Grant, who quoted from the Year-Book’ of New South Wales, page 140, to the effect that farm labourers were paid from 25s. to 50s. a week, and milkers from 25s. to 40s. a week. These wages are the lowest on a list of eight occupations for which the figures were given.
– There are also the wages which are paid in the factories.
– The cost incurred in the factory is comparatively low. The unsatisfactory position of the wheat and dairying industries is, in the eastern States, largely due to the high price of land. It is impossible to grow wheat profitably on what is little better than second-class land bought at £20 an acre. Wheat grown on such land cannot be exported abroad, and sold in competi-tion with that from other countries. To attempt to do that is uneconomical. The best land must be secured for the dairying industry, and the price has risen enormously. In the Western District of Victoria, and the Northern Rivers district of New South Wales, such land is selling at £100 an acre and more ia many instances. Honorable members can see by studying the tables given in the Tariff Board’s report that the interest allowed in respect to the purchase of land was in one instance as high as £590, while in other cases in which a man is milking a fair-sized herd, the interest bill will probably be larger. That, I am sorry to say, is a position that will not be bettered as time goes on. It is because of the high price of land in Australia to-day that the primary industries find themselves in such a bad position.
– It certainly has a lot to do with it, I think.
– In Western Australia to-day wheat farming, with a few sheep run in conjunction with it, is a fairly profitable occupation. I know of no occupation in the ordinary sense, outside of a retail business in the city, that is more profitable, or that gives a. steadier return. That is because in Western Australia land is still at a fair price. But when the first owners sell the land that they bought at 10s. an acre, for £5, £6 or £10 an acre, as will be done in a few years, the people who succeed us will find it very difficult to make a living because of the over-capitalization of the land. I believe that many of the primary industries in Australia - I refer particularly to the dairying industry and cattle raising - will find themselves in a better position as time goes on. The same thing will operate in regard to secondary manufactures. In Australia to-day we are really in the “hobbledehoy” stage. We are trying to establish manufactures and stabilize our primary industries in a country that has not got a large enough home market. When Australia has twice its present population, instead of placing a 100 per cent, tariff on dolls’ eyes for which there is no market, or striving to establish a shovel industry which has seventeen men engaged in it, we shall be able to consume most of our own products, and provide a market for our own manufactures. Then we shall be one of the most prosperous countries in the world, and we shall be as far ahead of where we are to-day as we’ are now ahead of where we were 30 years ago. The reciprocal agreement with New Zealand was a mistake, and it cannot be contended that the reciprocal arrangement with Canada has been to our advantage. I do not blame any individual Minister on this account. A man who attains Cabinet rank, in the Labour Party at any rate, is usually possessed of outstanding capacity, and occasionally a man of the ability of the present Minister for Trade and Customs is found on the Nationalist side. Naturally when the agreement with New Zealand was made those who negotiated for Australia did not anticipate that Dominion butter would be able to successfully compete in the Australian market. I believe that the increased duty will do some good inasmuch as the market will be less under the control of the butter manipulator who has exploited it in the past. It is with some diffidence that I express this opinion in opposition to that of the honorable member for Fremantle, who, I realize, knows much more about butter than I do. In the last two years Australia has imported £760,000 worth of butter from New Zealand. If that quantity of Australian butter had been sold at the average rates realized by the imported article a good deal more money would have gone into the pockets of the Australian dairy farmer.” As a matter of policy the least we can do is to see that the home market is retained for our own primary producers. Anyone who reads the Tariff Board’s report must be convinced of the necessity for doing something to assist the industry. I do not think an increase in tariff duties is the best method; a bounty on production would be infinitely better, but as we are not offered a bounty and we are offered an increase of duty I am prepared to take what we can get. If imports from New Zealand were shut out, the local butter producer would have the market to himself, and would reap the difference between the higher price obtainable here and the competitive price which he has to accept on the London market.
.- The committee is indebted to the honorable member for Fremantle for having initiated an animated discussion. Nobody will gainsay that the importance and immensity of the dairying industry and its present parlous condition merit full discussion in this committee. The facts and figures quoted by the preceding speakers indicate that the position of the industry is almost desperate. The Tariff Board after an impartial review of all the relevant facts was forced to the same conclusion as the majority of honorable members on this side of the Committee, namely, that increased tariff protection of the industry is essential. The honorable member for Fremantle was a little bit perturbed by the extent of the proposed increase, but I think we may take it for granted that he endorses the principle involved and secretly hopes that something effective will be done to give to the dairy farmer a necessary measure of protection. The honorable member suggested that a duty of 3d. in each of the three columns of the tariff would meet the situation and that the government should grant a bounty of l£d. a lb. on exports. I am not in favour of a bounty; a fixed duty is preferable. A bounty of even l£d. per lb. would mean an annual contribution by the Government of £1,500,000. The dairying industry has advanced in spite of adverse conditions, and it is the hope of every one of us that with more favourable conditions it will progress by leaps and bounds.’ If that hope should be realized and the bounty were maintained the government would have to meet an enormous and increasing liability each year. The honorable member for Fremantle contended that the increase in the protective duty will raise the cost of butter to the consumer. My answer to that is that the extra threepence per lb. is not to be added to the cost of all butter, but only to that fractional part of the total quantity consumed which has been imported from New Zealand. It was unnecessary for the honorable member to bemoan the fate of the worker who will have to pay this additional impost. So far we have no evidence that the workers of Australia object to making a slight contribution towards the welfare of fellow-workers who are not so happily circumstanced as they are, and I am confident that they will be quite prepared to pay the infinitesimal addition to the cost of butter that may result from the imposition of this duty. It is a lamentable fact that importations of butter from New Zealand have had a baneful effect on the dairying industry in Queensland. So varied are the climatic and soil conditions of this continent that even when one portion is suffering a drought or adversity in some other form, another portion is certain to be enjoying a good season. “ It is an ill wind that blows nobody good,” and it is unfair that when there is a shortage of butter in the southern States owing to seasonal conditions, the Queensland producer should not be able to have the advantage of that market but should haie to compete with imports from New Zealand. The honorable member for Fremantle criticized the Dairy Produce Export Control Board but I do not think he questioned the integrity of its members, although he suggested that they might be unduly influenced by the fact that they were both importers and exporters of butter. That fear is sufficiently answered by the fact that the board, an elective body, has been chosen to represent all phases of the industry and has the confidence of practically every person who is interested in the production and marketing of butter. Whilst I shall support the proposal contained in the schedule I do not think it fully meets the requirements of the industry. The honorable member for. Wannon (Mr. Rodgers) hit the nail on the head in the course of his discursive remarks on the industry generally, when he said that it will never enjoy a full measure of pros- perity until those engaged in it realize that the cows, should keep them, instead of them keeping the cows. The essential requirements of the industry are improved pasturage and herds - cattle that will give an adequate return for the time and money expended upon them. A comparison of the rural conditions in Australia with those in its greatest rival in the butter markets of the world, forces one to realize that this country has advantages which Denmark never enjoyed. Many of the best pastures in Denmark have been created amongst infertile sand dunes, which, as a result of cultivation and artificial fertilization, are now growing herbage that is second to none as a stimulant of milk secretion. In Australia we have done practically nothing to improve the natural pastures, but I understand that the Government of New South Wales has engaged an agrostologist - a gentleman scientifically trained in the cultivation of pastures, whose activities should be most fruitful. Before this Parliament terminates I hope that the Government will submit a proposal to help the dairying industry by offering financial and expert assistance towards the improvement of herds and pastures. Therein lies the way to successful butter production. I am delighted to have the opportunity to record a vote in favour of a duty which I hope will be of some assistance to the dairy farmers and their families, who are battling against conditions which approximate very closely to that sweating which we all desire to exclude from Australian industrial life.
– I am glad that the honorable member for Fremantle (Mr. Watson) remarked, in reply to my interjection that, if we allowed New Zealand butter to come in, it would form a greater source of speculation than any other element that could enter the trade. I quite agree with him. The honorable member for Indi (Mr. Cook) made a complimentary reference to my association with the industry. My experience, which was particularly on the selling side in Victoria, was that when butter was imported from “New Zealand, speculators were most active. When there was a like,lihood of only a slight shortage in Australia, wide-awake southern firms de:spatched their agents to New Zealand to buy direct from the factories there, because Melbourne firms were able to dispose of considerable quantities, not only in Victoria, but also in Tasmania, South Australia and Western Australia. While the varied climate of Australia has certain disadvantages so far as dairying is concerned, it also has its advantages. When dairy herds in the southern portions of Australian are suffering from the cold and are not giving so great a yield as they do in summer, we can look to the northern parts of Australia to supply our butter requirements. Surely we are sufficiently Australian in sentiment to say that Queensland, at certain seasons of the year, is entitled to a fair share of the local butter trade in preference to New Zealand. At a time when we were importing tons of butter from that dominion, we were, exporting large quantities to the Old- Country from Queensland. To-day the industry is on a far better footing than ever before, and it is largely due to the success of the efforts of those who, over a long period of years, have sought to organize it. Years ago we had co-operative dairying companies but co-operative marketing was unknown. I was associated with a company in Victoria that was the first cooperative selling company in Australia, and this soon proved conclusively that it was wiser for the dairymen to control the marketing of their own butter than to entrust it to private agents. Much good has resulted from organization along those lines ; but the industry has not yet nearly reached the success at which it aims. It has to face competition from Denmark and other countries. Whatever we may think of the Soviet Government, we must recognize that it is organizing the dairying industry in Russia and in parts of Siberia. A large number of Danes have taken up the industry there. No dairy-farmer knows more about the work than does the Dane. Once the industry is firmly established in Russia and Siberia the butter producers of Australia will have a more serious competitor in the British market, both with regard to quantity and quality, than they have had in the past. Therefore, it is imperative that the industry should be organized to the fullest possible extent. The honorable member for Fremantle spoke of a bounty on butter production; but I remind him that it is necessary to begin with bedrock principles. If the Government desires to assist the industry in the best way, it should supply to the various States a considerable number of well-bred bulls.
– That is one of the greatest needs.
– Undoubtedly. It is true that the dairymen will have to pay more attention to their pastures and conserve fodder in order to make their herds more profitable throughout the whole year; but, in spite of the present financial position, I should have the greatest pleasure in “voting for the setting aside of a sum of money for the purpose of purchasing the best bulls obtainable. I remember reading that Sir Horace Plunkett, when president of the’ Board of Agriculture, said to the dairymen of Ireland, at a conference held twenty years ago, “You people from Cork can make good butter. It is world-famed ; but a large number of Irish dairymen are producing butter on wrong lines, both in regard to quantity and quality. Pick out five of the best dairymen in Ireland and let them visit Denmark to study the methods employed there.” That advice was accepted. Five men were sent to Denmark, and they compiled a pamphlet that was distributed for the information of Irish dairymen. I obtained a copy of it, and the story of bacon and egg production sounded like a romance:
– Those engaged in dairying in Denmark enjoy ideal social conditions.
– That is true. Twenty years ago every cow in Denmark was worth £13 to the owner, whereas in Victoria at that time they were not worth more than £6 each. In Denmark each animal produced double the- quantity of butter obtained from cows in Victoria. The honorable member for Indi will correct me if I am wrong in that statement.
– Under the same conditions ?
– Certainly not. In Denmark dairy cows are hand fed, and a dairyman with, fifteen acres is regarded as a wealthy man. For years past Danish butter has topped the market in Great Britain. The Government is offering assistance to the industry, and I shall be a consistent protectionist by supporting the proposed duty on butter, just as I should support a duty on any other article that was competing with an Australian product. If the Labour party is not unanimous in supporting this proposal, it will be almost so. I am glad that the co-operative companies throughout the Commonwealth dominate the butter market so far as price fixing is concerned. There was a time when one firm in Melbourne fixed the price of butter for the whole of the State, because it had one of the best brands. To-day, however, a committee meets in each State from time to time, and, according to the production and the market conditions, it arrives at what may be termed a fair average price for the whole State. Owing to the proper regulation of the industry, the butter buyers will receive this commodity in future at a more consistent price than ever before, and for that reason they will save money in the end.
– As surely as daylight follows dark the price will increase.
– When no New Zealand butter was coming into Australia, butter was sold at a lower price than when it was being imported from that dominion.
– The honorable member for Warringah is quite right. That is the object of the duty.
– No. A protective duty protects the producer, and as this tariff will effectually shut out New Zealand butter, it will allow the Australian butter producer to have his own market.
– At his own price.
– If the consumer is to be “ fleeced “ it will be done by the men who represent the man on the land. I refer to those men in Brisbane, Sydney and Melbourne, who represent the man who milks the cows. They fix the price of butter and practically determine the price for Australia. The honorable member has levelled a charge against those whom he professes to represent.
I see no reason why the selling companies should seek to “ fleece “ the people.
– I am not suggesting that they are.
– The dairy-farmer does the work, he produces the article and surely those who represent him in the city have a better right than the ordinary speculators to fix the price of that commodity ! When primary or secondary industries are in need of assistance I shall always endeavour to be consistent in advocating increased duties, so that they may become self-contained.
– It must seem strange to outsiders that in a country like Australia, isolated as it is from the rest of the world, with a small population, and large areas of land suitable for dairy farming, we are to-day being asked to increase the duty upon butter and cheese in order to protect the dairying industry. It is certainly unfortunate that the existence of many of our primary industries would be jeopardized unless they were protected by the tariff from the competition of foreign products grown by cheap labour. The dairying industry might be termed the Cinderella industry of Australia. Half my electorate is devoted to dairy-farming, and the Minister for Trade and Customs could give no better Christmas-box to those engaged in dairying than this proposed duty on butter and cheese. It was given in evidence by one honorable member before the Tariff Board that 140,000 people in Australia are more or less directly connected with the dairying industry. Although we cannot class it as a waning industry, it certainly has not made the progress that it should have made in recent years. My electorate embraces 250 miles of coast-line, which is devoted to dairying. In that area there are from 50 to 60 dairy farms that have been abandoned because the dairy-farmers working them were unable to make a living. To-day the dairying industry is being carried on simply because of its peculiar conditions, which do not apply to other industries. No dairy-farmer can pay the wages paid in secondary industries and in most primary industries. The following list of workers in primary industries and their weekly wage appears in the Tariff Board’s report: -
– Do those wages include board ?
– Yes. That is usual in respect of men working on the land. Although milkers and farm labourers receive the lowest wages, few dairy farmers can afford to pay them.
– It must not be forgotten that those men work seven days a week. “ Mr. PERKINS. - I am coming to that point. The dairy-farmers are mostly unable to employ labour, and they therefore work their children in the dairy. A few years ago, when visiting a school in my district, I asked how many children had milked cows that morning. Out of a class of 50 children, only three had not milked that morning. That applies generally throughout that district. The only way in which the dairyman can make a success of the industry is to work the members of his family. I am surprised that there has been any opposition to the proposed duty because, it is certainly necessary for the protection of the industry. It is only natural that we who live in the cities like to buy our commodities at low prices, but if we gave any thought to the fact that little children are engaged in the dairying industry, and that the farmers are having to fight so hard for existence, we should not object to paying a slightly increased price in order that they might be assisted. The dairy-farmers work long hours and have few holidays. They work on Good Friday, Christmas Day, and Sundays, and in wet weather. They are tied to their farms, and the Minister is to be congratulated on coming to their assistance. I have already referred to the dairying industry as the Cinderella industry of Australia. During the last year or two - probably due to the aftermath of the war, arid not to any section of the Government or anybody else - the wool grower lias been receiving the benefit of high prices. The wheat-grower has had good seasons, and although the price of wheat is not what we should like, it certainly has given the grower a margin of profit. But the dairymen on the north and south coasts of New South Wales have been hard hit not only by the Workmen’s Endowment Act, as introduced by the State Labour Government, but also by bad seasons. As a result many of them are in an unenviable position. We must either assist the industry by a bounty, as was suggested by the honorable member for Fremantle (Mr. Watson), or by an increased duty. There is little opportunity at present for this Parliament to agree to a bounty, because it is to adjourn at the end of this week, and if no assistance were given to the dairy-farmers within the next few months, many of them would be compelled to abandon their holdings. For that reason they welcome this proposed increased duty. There, has been an exodus from my district lately, but it has been mainly due to the parlous condition of an industry connected with timber. The dairy-farmer, like other primary producers, has to send his commodities to the city markets, and, although he receives a return, by the time it reaches the consumer undue profits have been made by distributers and others. The honorable member for Fremantle has admitted that he is a distributer, and as such he is certainly entitled to a fair profit; but the man who consumes butter in the cities should be made to realize that the price that he pays for it is not all returned to the dairyman. Had it not been for cooperation’ among the dairy farmers, it would have been impossible for them to carry on in the industry. An ‘ old gentleman who was a storekeeper at Bega a few years ago, told me that Bega was one of the best districts on the south coast, but that whenever he sees a cow he longs to prick it with a knife. He contends that the dairying industry has killed that district, and that it would have made considerably greater progress under other industries.
– He held a view different from that of the late Tom Bent, a onetime Premier of Victoria, who said that he took his hat off to the cow.
– It is up to this Parliament to safeguard the people engaged in the dairying industry. The ..Minister for Markets and Migration has made a name for himself in Australia, and I am sure that if his photograph were distributed, among the dairying districts one would be found in a prominent position in almost every dairyman’s home. He has done a good deal for the dairying industry, but his scheme has been of no assistance to the cheese industry, which may be said to bealmost a waning industry. There are two cheese factories in my district, one at Kameruka and the other at Bodalla. The cheese produced there is well known throughout Australia, and quantities are being exported with excellent results. I am indeed pleased that an increased duty is to be placed on cheese, because it will certainly be of assistance to the industry. I realize that the duty will not affect importations of high-priced cheese to any great extent. One. importer, when giving evidence before the Tariff Board, said that some imported cheeses were selling at from 2s. 6d. to 3s. 6d. a lb. Some persons like Swiss cheese, and an increased duty will not entirely stop its importation. Australia is one of the largest butter-consuming countries in the world, yet, strange to say, it is one of the poorest cheese consumers. The proposed duty on butter will enable the dairymen to give some attention to the improvement of his herd. . His present returns give him a bare existence, and he has little opportunity to improve his herds. The increased duty will certainly enable him to obtain better equipment and buildings, and to devote some attention to his herds. A noticeable thing in connexion with the dairying industry is that the young men and women who work on the farms leave for the cities so soon as they reach a certain age, and it is seldom that they return to the industry. The dairying districts are being depopulated. In the Goulburn electorate, which I once represented in the State Parliament, and which nearly corresponds to the EdenMonaro federal electorate there had been no increase in population during the two years ending 1925 ; in fact, there was a loss of over 1,000 persons. The country people are rapidly drifting into the cities. Seeing that the dairying in- dustry is in such a poor condition, lt was asked by the Tariff Board how it is that so many motor cars are owned by the dairymen. I would point out that the motor car to-day has become almost essential to the success of the industry. The children have to be taken to school and goods have to be taken to and from the adjoining townships. We know that young men and women will not stay on farms unless they are able to have outings once in a while. The fact that many dairy farmers own motor cars is no criterion that the industry is progressing. A glance at the bank-books of many of the farmers would, I am sure, show that they are in a precarious position, and can ill afford to run motor cars for pleasure. The increased duty will give an impetus to the industry, but it certainly needs additional assistance to enable the dairy farmer to obtain an adequate return for his labour. In the south-east corner of my electorate one man has made a success of dairying; but that was only to he expected, seeing that he has a family of ten or twelve working for him. There are few such families, and it must be recognized that without a family no man can become a successful dairy farmer. I rose, as the representative of a big dairying district, to congratulate the Government on bringing this matter forward, and I sincerely hope that the duty will meet with the approval of this committee. In concluding, I shall quote the words of Mr. MacInnes, the Dairy and Agricultural Expert, “ Not only is the farmer broken in purse, but he is being broken in spirit, which is far worse.”
– Much has been said on behalf of the man who produces butter. I rise to say a few words on behalf of the man who eats butter. The Leader of the Opposition (Mr. Charlton), who represents an industrial constituency, stated that he does not believe that this duty will have the effect of increasing the price of butter’ to the wage-earner. I am afraid that the honorable member is somewhat optimistic, and that his optimism will not be justified by events. The honorable member for Eden-Monaro (Mr. Perkins) has just stated that the effect of the duty will be to increase the price of butter, whereat he expressed pleasure, as he believes that the dairy farmer will be enabled to improve his herds with the extra money. Those are conflicting statements, and I fail to see how they can be reconciled, I can imagine the feelings of the constituents of the Leader of the Opposition and the honorable member for Yarra (Mr. Scullin) when they are informed that this duty will increase the price of butter by 3d. a lb. My experience is that such increases are not appreciated by those who have to support families and who have to pay hard cash for the necessities of life; they mean a series economic handicap to such people. We have heard and read many speeches in favour of reciprocal Empire trade. The slogan was liberally used by the. Prime Minister when he was in England, and also by the Empire Parliamentary Delegation when it visited Australia. But as soon as practical effect is given to the principle of Empire trade reciprocity, honorable members object to the competition of other portions of the Empire which produce commodities in competition with Australia. I agree with the view expressed by the honorable member for Fremantle (Mr. Watson) when moving, his amendment, and I propose to support the amendment. I represent a constituency which is largely, if not wholly, industrial. Ninety-five per cent, of my constituents are wage-earners, and an increase in the price of butter will be a .very serious handicap to them. I should like to know exactly why this increase is demanded. One argument advanced was that the producers cannot carry on the industry and supply butter at the prevailing prices. I do not blame the producers for seeking for the duty, as they have to bear a large proportion of the burden which is imposed on the community by the protection afforded to our secondary industries. Naturally, they are beginning to tire of the other fellow obtaining all the plums, and now they ask for the extension of preferential treatment towards their industry. At the same time, the man who uses butter must be considered. The great bulk of the wage-earners will bear the brunt of this imposition. Honorable members should bear that in mind. Tariff protection must ultimately prove futile, no matter how high it may be, if we do not address ourselves more seriously to the problem of migration, and thus increase our local market to absorb the whole possible output of protected industries. Our real trouble is our limited local market. The time is fast arriving when the system of high tariff protection will break down of its own weight, because of the limitations of our local market. As soon as our primary producers are forced into competition with the world’s markets, they will find that they are just as effectively shut out from those markets as are the majority of our secondary producers operating under the artificial stimulus of high protective tariffs. Another important essential is the improvement of our -dairy herds, while a third essential is the necessity to apply scientific research to our methods of production. We have a Council of Scientific and Industrial Research, whose services should be at the disposal of our dairy farmers, just as much as any other section of our producers. We spend a large amount of money on the upkeep of that council, and some scheme might well be devised which would make it unnecessary for the dairy farmers, or any one else, to ask for the imposition of higher duties. The application of scientific methods to production would assuredly put our industries on an economic basis which would enable them to compete successfully in the markets of the world. I commend my views to the serious attention of honorable members. I support the honorable member for Fremantle in preferring a subsidy to a duty on butter, but if assistance is necessary it could more effectively be given by an export bounty which would not affect local price. Lf his view’s were accepted, every taxpayer would bear his share, and would know exactly how much was paid to encourage the industry. I take the view that bounties or subsidies are preferable to customs duties, as enabling the people to ascertain with some accuracy the actual cost to them of the financial assistance they contribute to the establishment and maintenance of industries which require to be spoonfed at the expense of the community.
Sitting suspended from 6.S0 to 8 p.m.
.- Before proceeding to discuss the item under consideration and the amendment by the honorable member for Fremantle (Mr. Watson), I wish to make a few remarks about certain speeches which have been delivered during the debate. The address of the honorable member for Lang (Sir Elliot Johnson) consisted only cif a mass of platitudes. When he was asked for facts and figures he was unable to supply them. It was said of another honorable member of this Parliament that he was a pious platitudinarian. The remark may be justly applied to the honorable member for Lang. Several other honorable members have had something to say about the value of the land used for dairying. We have a standard of value for dairying land in Australia. We put it down at £100 per cow acre. If only one cow can be carried to three acres, the land is considered to be worth £33 an acre ; if only one cow can be carried to four acres, it is put down at £25 an acre. A person who takes up dairying and pays a higher price than that for his land deserves all he gets. The honorable member for Fremantle and other honorable members have made the statement that the increased duty would be of no value to the dairy farmers.
– I said that it would not be of much assistance to them.
– The honorable member for Tarra (Mr. Scullin) and the honorable member for East Sydney (Mr. E. Riley) also said that the duty would not assist the dairy farmers.
– The’ honorable member for Yarra did not make that statement.
– I am sorry if I have done the honorable member an injustice ; but that is what I understood him to say. The honorable member for East Sydney also observed that we could not control the export of butter ; but we do control it through the Dairy Export Control Board. What we cannot control is the home consumption.
– We should be able to control the local price.
– As to whether the duty will assist the dairy farmers I quote the following statement by Mr. L. T.
MacInnes, the dairy expert of the Department of Agriculture of New South Wales -
The books and accounts of all registered New South Wales dairy produce factories are regularly audited by certified public accountants, also by Government inspectors under the provisions of this State’s Dairy Industry Act, which enforces that each supplier must re.ceive payment for every pound of butter made from the cream delivered at the factory, such payments and statements to be rendered as prescribed.
Nearly all the butter.’ factories in New’ South Wales and Queensland are co-operatively controlled, and so are about 50 per cent, of the Victorian factories. Seeing that Mr. MacInnes has made it quite clear that the factories must give the dairy farmer a return for every pound of butter made from his cream, it can hardly be denied that an increased duty must directly benefit him. It has also been stated frequently during the debate that New Zealand butter is imported into Australia during our off season to supply our requirements; but statistics show definitely that the peak period of importation is usually about March, when we are in full season. The New Zealand importations have nothing whatever to do with our seasonal fluctuations. I wish now to put on record a few statistics to indicate the value of the dairying industry to the Commonwealth. We have 2,444,637 dairy cows in Australia. The value of the butter, cheese and condensed milk produced in our factories in 1925 was £22,726,214, while the total value of our dairy production, including butter, cheese, milk, bacon, eggs, poultry, &c, was £45,189,543. The value of the land and buildings used for factory purposes was £1,863,439. The value of the plant and machinery used in the factories was £2,385,027. The number of factory employees was 5,826; and the amount paid in wages to them was £1,287,689. It will be conceded, therefore, that the industry is worth protecting, and I am glad tha: the majority of honorable members who have participated in this debate are of the opinion that the best way to help it is that suggested by the dairy-farmers themselves. As we are producing sufficient butter to supply all our needs and still have an exportable surplus we should prevent the importation of butter.
– Would the honorable member be prepared to prohibit the importation of butter?
– In the circumstances, yes. Our butter has brought a* high a price on the London market as that from any other part of the world. There is no question but that our superfine butter is a prime product. The honorable member for Fremantle suggested that instead of increasing the duty on butter the Government should pay a bounty of 2d. a lb. on it; though ‘later he altered the figure to l£d. a lb. If a bounty of 2d. per lb. had been paid b?i last years output a sum of £2,277,614 would have been involved; if 1 1/2 d. per lb. had been paid the amount would have been something over £1,500,000. The honorable member did not suggest the source from which this money should be obtained. Seeing that I represent the biggest dairying district in Australia, which produces more butter than South Australia, Western Australia, Tasmania, the Northern Territory and the Federal Territory combined, I should know something about the subject. My division is responsible for a third of the butter produced in New South Wales, and that State is the principal butter-producing State of the Commonwealth. ‘ At the representative of these dairy farmers I assert that they desire to work out their own destiny. They want neither doles nor charity; they want only an opportunity to develop their industry in the best way. But so long as we permit butter to be imported we shall prevent them from stabilizing their market, which is the first step in placing the industry upon a substantial basis. The honorable member for Fremantle admitted that he had been a dealer in butter for the last 30 years in Western Australia, but that State is producing only 2,500,000 lb. of butter annually out of a total Australian production of 273,000.000 lb.
– The butter production of Western Australia, like all her other primary production, is increasing rapidly.
– The fact remains that up to date it has been negligible. The honorable member for Fremantle has admitted that he has been a speculator in butter. I ask, therefore, whether he is qualified to advise us as to the best means of assisting the dairy farmer? Would he not be likely to make a suggestion which would still leave the way open for him to continue his speculative activities ?
– The honorable member is hardly doing himself justice.
– I listened carefully to his speeches, and I submit that he indicated quite clearly that he was an interested party, and therefore not entitled to address himself to this question. He is a directly interested person, not only as a member of the general public, but in his own main business, and he wants, as an importer of butter, and as a speculator, to keep the dairy farmers on the same low plane as now, so that they may be still further exploited. The honorable member states he is a protectionist, and yet, when it touches his own pocket, he is a freetrader. A little bit of consistency is a very desirable attribute. There are pseudo friends of the farmer who weep crocodile tears whenever he is mentioned, but as soon as a constructive plan, by which something might be done for the farmer and the dairying industry is brought before the House, everything is done to shelve it. We have the Paterson scheme, under which an increase of 3d. a lb. may be made in the price of butter in Australia by means of an ingenious working of an economic law. If we pay a bounty of l£d. a pound on butter, it will mean that the Paterson scheme will be able to operate only between the lid. and the maximum of 3d., which the farmer may receive at the present time. The honorable member wants to destroy the benefit which the farmer is receiving through his own co-operative efforts, and to let this Parliament shoulder the burden. The industry does not want this bounty. It is at present obtaining benefits under the Paterson scheme. The farmers do not want to ask for £1,500,000 as a bounty from Parliament. The farmers like to work their own industry free, as far as possible, from any political control whatever. By this ingenious scheme, for which the honorable member obtained the “ hear, hear “ from the freetraders this afternoon, he proposes to take away from the farmers the benefits they have received during the last few years, and he is going to give them nothing in return. When one considers the amendment carefully, one realizes that the farmer would be worse off under the honorable member’s proposal than he is now. That was what I was referring to when I spoke about the pseudo friends of the farmer, and there are, unfortunately, some representatives of the farmers here who for reasons known only to themselves are only too ready to support such schemes as the present one. The farmers do not want charity. They do not get it, and they do not want it. All they want is to be given a chance, the same as those engaged in secondary industry, to develop their own industry, and to try, as best they can, to supply the whole of the Australian market.
– May I ask who pays the 3d. per lb. under the Paterson scheme ?
– The people who buy the butter. I do not deny it. The honorable member for Lang (Sir John Elliott) this afternoon made a great point of the fact that the honorable member for Eden-Monaro (Mr. Perkins) said the price of butter would be increased. He said that it would put up the cost of living. Even if the price of butter were increased to the full extent, it would only add to the cost of living by 2d. per head a week on the basis of Australia’s population. That sum would not be missed, but it would mean all the difference to that huge baud of people engaged in the dairying industry, of whom there are 89,760 males, and 54,025 females, making a grand total of 143,785. Those people will benefit under the proposed increase. It will go further towards providing that standard of life which we have set up for ourselves in Australia. The farmers will be given an opportunity, not only to live a little better themselves, but also to pay higher wages to those whom they employ. The dairy farmer has no desire to be a sweating employer under any circumstances. He is just as glad in his own way to pay decent wages, and to see that Australian conditions are maintained as any one else is, if he is given an opportunity; but at the present time it is denied him. All this House is asked to do is to give him that opportunity. We are not asking for too much. We are asking for an increase, of roughly 33J per cent. As compared with the protection which Parliament grants to some industries, that is a very small amount. The honorable member for Capricornia (Mr. Forde) quoted figures this afternoon showing what dairymen are receiving. I have here some figures prepared by the Norco Butter Factory, which is one of the largest in the world. Last year it produced approximately 28,000,000 lbs. of butter. These returns show the average amount paid to suppliers in the months of January and November respectively. For January, 1912, the average amount paid to suppliers was £32; in November the amount was £27 13s. Four years afterwards, in 1916, the company paid an average of ^£23 in .January, and £52 in November. In January, 1926, the average amount paid was £59, and in November, it was £28. In January, 1912, the price paid to the supplier was 12id. per lb., while the average amount paid per month was £28 ; that is, less than £7 a week, out of which the farmer had to pay for everything* In January, 1916, the price paid per lb. to the farmer was still 12£d. Ten years afterwards it was 12£d., a rise of only a id. In 1927, it was 13id., a rise of only Id. Therefore, in January of this year, the price was only a Id. higher, than it was fifteen years ago. Add to that amount the sum of 3£d. per lb. for cost of manufacture, insurance and freight, and you arrive at the price at which the article should be delivered at the wholesale stores.
– Where does the honorable member get those figures?
– If my honorable friend, the know-all, the one who knows about everything on the face of the earth, disputes these figures, I may inform him that they are official figures supplied by the Norco Company.
– Those are the figures which the honorable member read, but we do not know anything about the figures he guessed at.
– I guessed at nothing. I have given the price paid to the suppliers. After that, there is freight, cost of manufacture, cost of butter boxes, insurance, and freight away from the factory. All this works out at 3 1/2 d. per lb. The latest figures as given by the Empire Marketing Board show that the cost of a cow, at the present time, is £14 per annum. This sum includes all costs. If the cow produces 140 lb. of butter a year the cost of production works out at 2s. per lb. If she produces 200 lb. of butter it works out at1s. 4¾d. per lb., and if she produces 260 lb. a year the cost of production is1s.1d. per lb. Therefore, according to the figures I have quoted, even if a cow were producing 260 lb. of butter, and so reducing the’ cost of production to1s.1d., the farmer would not cover the cost of production by the price he received for his butter. The average yield for each cow in New South Wales for the year 1923-24. which was a drought year, was only83 lb. In 1924-25, which was a good year, the average yield went up to 150 lb. It is clear, therefore, that the season makesa very big difference in the yield. It has been told us by the honorable member for Wannon (Mr. Rodgers) and other theorists, that the farmers should re-organize the industry. There is only one way to get better results, and that, is to feed the cows, but if the farmer is not getting the cost of production, how is he to feed his cows? I like these theorists who come here and talk about the dairying industry! They should be practical, and give us facts and figures, instead of talking platitudes and filling the pages of Hansard with a lot of matter which probably no one reads but themselves. In 1923-24, only 5 per cent, of the cows tested in New South Wales produced 200 lb. of butter or better, but in 1924-35 the percentage had increased to 22 per cent. When 200 lb. of butter a cow is produced, the cost of production is1s. 4¾d. per lb., and when, for one year, only 22 per cent, of the cows produce that amount, it is seen that the position of the industry is considerably worse than members of this Blouse had thought. In Denmark, during the war period, the farmers were unable to. obtain the feed required, and the average production for each cow fell considerably. The same thing operates in this country when, on account of drought, the farmer is unable to give his cows the proper feed. The dairyman is receiving considerably less than the cost of production, which, according to the Empire Marketing Board, averages 2s. per lb., allowing £14 per cow, and a yield of 140 lb. of butter fat per cow per annum. The Bathurst conference assessed the cost of production at1s.11d. per lb., which is practically the same as my figure, although worked out on a different basis. As the farmer is not receiving more for his butter now than he did earlier, when production costs were lower, it is clear that something has gone wrong. Though the world’s price of butter is higher, the costs of production have risen, and the farmer has to pay them, even under the co-operative system. If butter is sold at1s. 6d., and the total cost of manufacture, and delivery to the retailer’s counter is equivalent to 6d. a lb. in one year, and increases in the following year, the difference is taken from the receipts of the supplier. I have some very interesting figures relating to the increased costs of one factory over a tenyear period -
The significance of those figures is emphasized by the fact that the factory’s production in 1916 was nearly double that of 1926. so. that it had to pay heavy additional costs on a smaller output. The following figures, showing how the costs of one Victorian factory increased between 1913 and 1926, are of interest -
Despite that increase the price obtained by the dairyman showed no advance.
– The Minister has stated that the effect of imposing duties is to make commodities cheaper, so the dairyman will get nothing from this increase of duty.
MrR. GREEN. - The object of the increase of duty is to give the industry a chance to rehabilitate itself. We do not deny>that the price of butter will increase.
– Just as the price of other commodities rise.
– Yes. Most wages in Australia are regulated according to the cost of living, and as butter is included in that cost the increase of 2d. per week in the butter will not affect the working man.
– What, nonsense ro talk about an increase of 2d. per week per family for butter.
– 1 did not say that about the honorable members Speech, although I had my own views. The increase of 2d. per week is per individual, not per family. Most of the imported butter comes from New Zealand, and the increases during the last few years have been remarkable. The quantities are thus slated in the Tariff Board’s report -
Honorable members will notice that the imports fluctuated considerably, but it rnakes no difference to the local producer whether the imports from New Zealand amount to 1 ton or 5,000 tons; so long as the possibility of importing butter is suspended over the industry like the sword of Damocles, we cannot stabilize the industry. As soon as an effort is made to put it on its feet, agents like the honorable member for Fremantle cable to New Zealand for supplies of butter, and smash the local market. That has been done before, and will be done again. We want to secure the Australian market for the Australian producer. That is. the object of asking for this increased duty.
– Let us take a vote on it.
– No ‘ doubt every honorable member has made up his mind, so I shall not further debate the subject; but I hope the committee will not entertain the futile amendment suggested by the honorable member for Fremantle, who, while pretending to be offering something to the dairy farmer, is really taking away that which he already has. His amendment, if adopted, would .interfere considerably with the Paterson stabilization scheme. I commend and thank the Minister for having adopted the recommendations of the Tariff Board. As the inquiry into the industry followed representations made by me in this chamber eighteen months ago, and as I represent more dairymen than any other honorable member, I have a deep personal interest in the matter.
.- As there are many dairymen in my electorate, I do not wish to give a silent vote on this item. The remarks of the honorable member for Richmond (Mr. R. Green) showed that he had some book knowledge but very little practical knowledge of the dairying industry. I am entirely in sympathy with the proposal of the honorable member for Fremantle (Mr. Watson), because any benefits accruing under it would go direct into the pockets of the producers. When, 35 years ago, Victoria decided to develop the dairying industry, the Parliament offered a bonus of 2d. a lb. until such time as the production in that State reached a certain quantity. That proved a most effective stimulus to the,increase of dairy herds and butter production. I pay a lot of heed to the views of the honorable member for Fremantle upon the butter industry, concerning which he knows more than any other honorable member of this committee. Moreover, he has proved himself to be quite unselfish by submitting a proposal that would be detrimental to the business in which he is interested, although of very great benefit to the dairyman. I cannot believe that the farmer will’ receive more for his butter-fat because of the increased duty; but I am confident that the consumer will have to pay an increased price. The honorable member for Richmond said that the manufacturing costs in relation to butter production have increased since 1913 by 161 per cent. The Tariff Board disclosed that in its report, and we should pay some heed to what the board has said. The additional load placed upon industry has necessitated the applications for increases of duties. The dairyman is quite justified in asking for a duty of 6d., 9d. or ]s. in order that he may be able to pay the additional costs with which he has been burdened by the fiscal policy of this country; but will an increase of -duty improve his position ? The honorable member for Richmond said that the workmen can pass the increase on by getting a higher award from the Arbitration Court to meet the greater cost of living. If that happens, the increase of 161 pei1 cent, in manufacturing costs will mount still higher, and the dairying industry will be in a worse position than it is to-day. The Tariff Board, in its annual report, drew attention to the abuse of protection, and uttered a warning in these words -
In addition to the tendency to the abuse of the protectionist system by industrial unions and by manufacturers in the directions already referred to, the primary producer is disposed frequently to do likewise.
It is quite obvious that both primary and secondary producers expect to hold their own domestic market against all outsiders. Costs of production are now so heavy in Australia that, in order to effect this object, the tariff <ni primary, and especially secondary, commodities has to bc kept high, and if production costs are not checked, may have to bc raised still higher. The result of this condition is that no market other than the domestic is open to the secondary producer.
That is a most important statement by the Tariff Board. There is no market other than the domestic one for the secondary producer. Why? Because of the cost of production. What chance have we of getting a big population in this country if we cannot sell to anybody but ourselves? The report continues -
He cannot compete with the outside world and is confined within the area controlled by the Commonwealth. The primary producer is tending in the same direction and lias been saved from the same actual position, firstly by reason of the application of machinery to his harvesting, and secondly, by the unequalled pastoral advantages possessed by some parts of Australia. For the products of these industries, he still has a market overseas and is able to survive at the world’s parity. Outside of those products he. is in much the same position as the secondary producer and has been pressing for the same consideration at the hands of Parliament, namely, the assurance to him of his own domestic market against the world. In these directions he does not hesitate to ask for duties high enough to effect this purpose and even at times for a complete embargo. In this way, whilst frequently protesting against the alleged burdens heaped upon him by the secondary producer, he himself demands complete immunity at any cost from overseas competition, and is not always on his guard against sheltering inferior products and inefficient methods. This characteristic is illustrated by the applications of the primary producer for embargos either by tariff or other means against competition, not merely from foreign countries but from sisterdominions. Such examples as sugar, hops,, millet, maize, potatoes, bananas, peanuts,, tomatoes, eggs, butter, cheese, wine, tobacco,, dried fruits, can be cited as illustrating this tendency.
If all industries are to be helped, shall we be better off in the end? If the dairying industry is to be- assisted in such a way that the dairyman will benefit, &. bounty instead of a duty should be imposed. About £600,000 has been paid i» . bounty to two wire netting factories,, which are not nearly of the same valuelo Australia as the dairying industry. A .direct bounty should be given on the cream sold.
.- The com”mittee is much indebted to the honorablemember for Fremantle (Mr. Watson) for his able, fearless and disinterested! speech. The whole day has been taken.up in the advocacy of a duty by those who agree with the Government’s proposals, and it is only right that the minority should express its opinion. The honorable member for Fremantle, owing to the Standing Orders, was unable to submit his proposal as he would have liked to do. He desired to bring before us the definite issue of a bounty versus a duty; but he was not even permitted to include in his motion an indication that the reduction he proposed was moved with the object of showing that a bounty was preferable to a duty. The committee should vote upon this matter with that connotation in mind. I wish to make that clear, because we have a right to interpret the votes of honorable members in the light of that intention. Everybody knows that the dairying industry labours under great disabilities. We have had hours of discussion directed to proving what is a matter of common knowledge. Since we all wish to assist the industry, we should consider the proper way in which it could be done.
– Those who ask for the dutycan best determine that.
– I - I do not agree with thehonorable member for Darwin. Thosewho give the help, not those who receive-, it, have the best right to decide what shall be its nature and extent. Many advocates’ of ihe duty have admitted that it would result in an increase in the price of butter. The many duties imposed on foodstuffs will be a serious factor in the economic struggle before us. The mischief of a duty is that it not only costs a certain sum directly, but it also causes an indirect increase in the «>st of carrying on the industry. I am informed that, although the Paterson scheme involves an annual nominal expenditure of. about £1,500,000, the indirect extra charges bring the cost up to £2,000,000, which is added to the price of butter to the consumer.
– How is the extra sum arrived, at?
– By the costs and profits due to the increased price. We have to decide whether we can help the butter industry without imposing upon the community the ex tin hurden of a duty, which would be additional to the cost of the Paterson scheme, and might involve a further £1,000,000 or £1,500,000. We arc told that the duty would prevent the exploitation described by the honorable member for Fremantle by excluding New Zealand butter; and on that argument many members of the Opposition havebased their support of the duty. The honorable member for Fremantle has explained that their optimism is unfounded, and that the duty would not necessarily keep out New Zealand butter. On the other hand, it would result iti increased exploitation rather than diminish it. New Zealand butter would be standardized in price with Australian and the exploitation would still be carried on, but on a higher price basis. It seems to me that the duty would not accomplish the end in view, because only a small proportion of it would be received by the man on the land who really needs assistance. Surely, if the duty would not achieve its object, it would be too heavy a burden for us to place upon the community. I think that a bounty of 1-Jd. has been mentioned. Personally, I favour the idea, but the exact amount would be a matter for careful inquiry. The bounty should be paid direct to the cream producer.
– Would the honorable member abolish all duties, and substitute bounties ?
– Unquestionably, I. should prefer bounties to duties. I do not think that a bounty would bo necessary in this case-, if the primary producer had not been driven into a corner with his back to the wall owing to our so-called “ settled “ protective policy. This has greatly increased the cost of living by artificially raising production costs. The people of Great Britain had a similar experience in the old days of protection there, and the parlous condition into which the primary producers ultimately fell was responsible for a reconsideration of the fiscal policy. I should like to see protective duties abolished; but if we insist on carrying on the protective system until it breaks down under its own weight, the primary producer would be less than human if he did not ask for a share of the duties. It would be absurd and unreasonable to expect otherwise, and therefore I say that the primary producer has a right to be helped just as much as any other section of the community. This system of mutual help is coming to such a pass that it must break down under its own weight. I do not see why one section of the community should bear the’ whole brunt of the burden. I should certainly prefer the payment of a bounty, as suggested by” the honorable member for Fremantle, and for that reason I am opposing the proposed increased _ duty - not because I do not think the primary producer requires help, but because ari increased duty is the wrong way to give it to him. As far as I can gather from the Tariff Board’s report, the question of a bounty was never PUt before it. No evidence was given for or against a bounty, and the board confined its inquiries naturally along the lines of the reference to it.
– The board could have brought in a recommendation for a bounty if it- thought fit to do so.
– I wonder that it has not done so; but from its report it does not appear to have considered the payment of a bounty as an alternative to an increased duty. For that reason I do not think that we should necessarily accept the recommendation of the board. The final responsibility of any additional burden that is placed upon the community must rest upon this Parliament, and we should certainly be justified, in the light of the knowledge that we now possess, in setting aside the Tariff Board’s report, while at the same time preserving the principle embodied in its annual report, which has been recited by the honorable member for Forrest. It will be said that I am opposed to helping the dairy farmer; but that is not so. I have made it perfectly clear that it is our duty, as representatives of the people generally, to protect ‘ the interests of the consumer. The dairy farmers have established an organization for the protection of the industry; but the ordinary consuming public has no means of making its protests heard in this Parliament against the additional burdens that we are thoughtlessly placing upon it. Its interests are not considered, and its representations are brushed aside with platitudes and catch phrases; but the burden of this increased duty, like that of other duties which we have considered, will fall upon the small man, who already finds it difficult to confine his expenditure within his wage return. Unemployment is stalking through the land, and there are complaints of hardship in every direction. We have, . therefore, no right to increase the burden of the consumers by one single halfpenny, especially when that burden is far greater than the actual amount of duty that will be collected under this item. As has been clearly shown by the honorable member for Fremantle, no one can estimate what that burden will be. We know only what will be the minimum burden. On the other hand, if a bounty were given, we would know the exact cost of assisting the dairy farmers in order to counteract the handicaps that have been placed upon them by this Parliament in other directions. I dislike the proposal for an increased duty, because of the example that it affords of the insincerity of the Government’s alleged policy of Empire trade. I pointed out the other night that when an opportunity arises to give effect to that policy they fail to grasp it and go back on it. Their principles have not stood the test in respect of Canada, New Zealand or South
Africa, and I demonstrated the other night how they had not stood the test in regard to our relations with the Old Country. Because of that, also, I am opposed to the proposed duty, but more particu– larly because of the burden that it will place upon the community. The benefit of the increased duty will not be received by the man who really needs it. Those who profess lo champion the cause of the poor man aud the dairy-farmer will find eventually that their arguments will react against them and the increased duty will be inimical to the interests of those whom it is intended to benefit. A
.- Even at the risk of offending honorable members who have objected to what they call the stone-walling methods of this side of the committee, I propose to discuss briefly the item before us. It is indeed bad graceon the part of an honorable member tocommence his speech by a criticism of the stone-walling methods of honorable members when he himself took no less than hours in discussing the main, question. I am and have always been a protectionist, and I am indeed glad that at this late hour some effortis being made to protect the dairying industry which for many years has been in need of assistance. Our secondary industries throughout Australia are developing to-a great extent as a result of the tariff. No industry in Australia- imposes greater hardships upon the men engaged in it than does the dairying industry. I have had some experience of dairying, because 40 years ago I was earning my living on a farm, and I can recall the many hardships that those engaged in the industry were compelled to suffer. I am pleased indeed that the Government intends, as a result of the recommendations of the Tariff Board, to give some measure of relief to the dairying industry. The honorable member for Perth (Mr. Mann) who is a freetrader, declines to recognize the fact that the proposed duty will be of assistance to the dairyman, but I contend that those who know the industry, and have experienced its many vicissitudes and the difficulties of carrying on under Australian conditions, know better what their requirements are than the honorable member for Perth. We cannot close our eyes to the fact that the dairying industry was established and developed principally by the small mart - the man with the young family and little capital, who in many eases had to settle on second class country in order to commence dairying. He naturally has had little opportunity to improve his herds as has been suggested. During the last nine years we have spent a considerable sum of money in settling returned soldiers on dairy farms. Many of these farms were purchased at inflated prices, and this has ?made it almost impossible for the returned soldiers to make a living. It is very essential that they should be assisted. I have always advocated adequate protection for our industries, and I know of no industry that is more deserving of assistance than that of dairying. .It nas been said that importations of New Zealand butter into’ Australia cannot influence the prices here, but the argument used by the honorable member for Richmond “(Mr. R. Green) showed conclusively that the effect of keeping New Zealand butter out of Australia will materially assist the dairy-farmer. In deference to the desire of the Government to conclude the discussion on this item, I ;shall content myself with supporting the proposed increase of duty on butter.
.- I am loth to lengthen this somewhat protracted debate, but I do not wish to give a silent vote upon the item. The Government has wisely decided not t(attempt to curtail the debate. The dairying industry is the most sweated of all our primary industries, and it is very extensive. The imposition of this duty is a further confirmation of a new policy that has arisen amongst our primary producers, the majority of whom have been opposed to the imposition of high duties. They have considered, rightly or wrongly, that the high duties are detrimental to their interests, and have pledged their Parliamentary representatives to a reduction of duties, which pledge, in some cases, has not been carried out. Now the primary producers, in despair, are asking for a hair from the dog that bites them; they want a share of the protection granted by this Parliament. Many of those who advocate an all-round protection say, as frankly as I do, that they do not regard it as economically sound. The policy of making everybody prosperous by making everything dearer is not one that appeals to me. If it is proved that it can be applied and allows Australia to remain solvent and “to become prosperous, I must then admit that I have been on the wrong track. I believe that this duty will mean an increased price for butter, not only during the time when New Zealand will- provide us with butter, but throughout the year. One has only to read the report of the Tariff Board to realize the deplorable condition of those engaged in the dairying industry. The natural corollary of the imposition of these duties must be the inauguration of a system of price fixing. This is socialistic legislation of the most flagrant kind. I can understand the policy of honorable members of the Opposition, who advocate price fixing, but I consider it to be unsound. I should like to know, and 1 feel sure the producers would like to know, whether this Government is prepared to follow the policy of protection to Australian industries to its logical conclusion, and to compel our primary industries to organize, just as the trade unions have organized.
– Does the honorable member make any distinction between a protective policy and a bounty, from an economic point of view?
– Yes. The granting of a bounty on production would not be as effective, so far as increasing the < price of this product in Australia, as this proposal. I believe in a bounty upon exports, and I go further than this proposal, and say that if the Government intends to give Australian dairymen the same conditions and privileges that it gives to other industries, and expects them to produce an exportable surplus, it must follow up this Gd. per lb. duty by granting an export bounty. If that is not done, there is the danger that our dairymen will do what our secondary industries have done, restrict production to the limit of the Australian market.
– To be consistent the honorable member would have to give a bounty on wheat .if the price of wheat dropped below the cost of production.
– That is so.
– Whore would the honorable member obtain the money?
– From the surplus customs revenue. I consider that the compulsory organization of this industry is the natural corollary of the protection now being granted. We have export control board legislation which,’ in effect, creates compulsory pools for export. Our export control boards for butter and dried fruits are a recognition by the Government of the fact that one cannot have effective organization for overseas markets without compulsion. The element of compulsion in our export control boards has been responsible for their success. Take away that compulsion and the efficacy of the boards falls to the ground. If we intend to provide people with cheap food, surely those people should be our own kith and kin within the Commonwealth? Australian butter, sugar and dried fruits, to give but, a few illustrations, can be purchased more cheaply by the workers in London than by the workers in Sydney. That is an anomalous position. We consider that the policy of exporting surplus production overseas at a lower cost than prevails within the country of origin is such a pernicious one that we introduce anti-dumping legislation. We legislate to prevent others doing what we are doing ourselves! We did so with wire netting. Some years ago there was a considerable outcry because anti-dumping duties were imposed on wire netting, as it was contended that the commodity was being sold more cheaply in Australia than in the country of origin. Immediately we start to supply the workers oversea with a commodity at a price lower than we pay ourselves, the oversea country concerned sets, in operation against us anti-dumping legislation. That was done by Canada, in connexion with butter. I submit that, as protection is given so generously to secondary industries, our wheat-growers should do what the manufacturers of machinery do. They should charge an Australian price for the wheat that they grow. I oppose, as a policy, the imposition of excessive duties, as I believe that it is economically unsound. I shall vote for this duty merely because I consider it to be a retaliation on the part of the primary producers, who have been forced into their present position. Undoubtedly the duty will increase the price of butter and the cost of living, and if it is applied to other industries our workers will inevitably have to make further applications to the Arbitration Court for the wherewithal to pay the increased cost of living. And so the ‘ vicious circle will continue. The most serious aspect of the matter is the position of our export trade if we pursue such a policy. We talk ‘of an imperial policy of Empire preference. If Great Britain lowers its duties to give us preference on its markets, it is done at. the expense of the British taxpayer. There is a reduction of British customs revenue, merely to subsidize our exports. Great Britain deliberately reduced its duty on dried fruits to favour Australian production. To the extent to which the British Government has lost customs revenue, it has benefited our dried fruit growers. About 97 per cent, of our primary produce is exported, but we have an adverse trade balance to-day because of our reduced production. In such circumstances we have gone to the Mother country to borrow money. We are too proud to trade, but not to proud to borrow. I sympathize with the object of the honorable member for Fremantle in moving the amendment, but I shall not vote for it, for it would put me in the position of supporting a reduction in the duty on butter. The dairymen of Australia deserve all the help that we can give them. I shall do everything that I can do, both inside and out of this chamber, to assist the industry. I trust that the Government will take steps to provide an export bounty on butter in addition to the duty set out in the schedule.
.- The only conclusion that one can come to after reading the report of the Tariff Board on this item is that the dairying industry in Australia is in a stagnant condition. Witness after witness appeared before the board and stated that the dairymen were engaged in an endless struggle to make ends meet. The great majority of Australian workers, whether engaged in primary or secondary industries, receive a decent wage and have a good standard of living, but it is not so with those engaged in the dairying industry; consequently these deserve our most sympathetic consideration. The total amount of butter available for consumption per head of the population in Australia in 1925-26 was 29f lbs. If an increase of 2d. per pound occurred in the price of butter, it would mean that on the average each butter consumer in the community would be obliged to spend 5s. u. year more on it. Our city dwellers could easily recoup themselves for that expenditure by remaining away from the picture shows for a week or two. There is no doubt that the dairying industry is suffering considerably because of our importations of butter. We are producing in Australia a sufficient quantity of butter to supply our own requirements and export a third of our total production. It is unreasonable, therefore, that we should allow importations of butter from New Zealand during the off-season in the south while the butter producers in the north are obliged to suffer all the uncertainty and expense of exporting their products. Our dairymen have frequently carved their farms out of virgin forest by working fourteen and sixteen hours a day, but their wives and children are still obliged r,o work hard to get a living. We all know that it is a common thing for the children of dairymen to work hard before they leave for school in the morning and after they return from school in the evening. Generally speaking the dairymen have to undergo privations and difficulties at the very thought of which city dwellers would become sick at heart. All too frequently the roads in dairying districts are bad and the difficulties of obtaining access to the railway considerable. But hampered as they are by lack of capital and payable markets, the dairyfarmers have carried on. It is difficult for them to obtain advances from financial institutions to tide them over their slack periods, for everybody knows that the industry is in a precarious position. The dairymen on the Atherton Tablelands have done wonders in clearing forest country and establishing themselves on their holdings; but they have great difficulty in obtaining a profitable market for their butter. When the southern market is suffering from a scarcity of butter in its off season, which the northern producers could very well supply, New Zealand butter is imported, with the result that the Queensland butter has to be sent overseas for a return which is considerably less satisfactory than that which ‘could be obtained on the local market if the New Zealand butter was not admitted. I know that in consequence of the distance Atherton is from the main centres of population, the Department of Markets and Migration cannot send testers and graders there to determine whether the butter produced is suitable for export; but surely something can be done to place it upon available .markets in Australia. I should be prepared to vote for a much higher duty than 6d. per lb. in order to ensure that our dairy farmers might enjoy a few of the pleasures of life which city people look upon as indispensable. Possibly the condition of the industry could be improved if fertilizers were used more extensively, the quality of the herds improved, and the general equipment brought up to date, but how are these people to provide the money to improve their cattle and equipment and fertilize their land? Their churns, dairying and agricultural implements, vehicles, harness, and foodstuffs are taxed heavily, so that really they are sacrificed for the benefit of the secondary industries. lt is very easy to say, “ Cut out the duties and pay bounties “ ; but where is the money to come from to pay the bounties? It would have to be obtained by taxing the people, and it appears to me that it might just as well be secured through the customs as through other avenues of taxation. I am convinced that the dairying industry is entitled to this and an even greater measure of protection. I shall, therefore vote for the item.
– I do not desire to give a silent vote on this item. Various honorable members of the committee who claim to have an expert knowledge of the dairying industry, have assured us that the imposition of the increased duty on butter is justified, but not one of them has drawn attention to the fact that the item imposes an increased duty on both butter and cheese. The duty on cheese has been increased by 100 per cent., but not a word has been said to justify it.
– The honorable member for Eden-Monaro (Mr. Perkins) discussed that aspect of the matter.
– I did not hear him. I am convinced that every honorable member of the committee wo aid willingly do all in his power to assist the dairymen, who are perhaps the most hardworking of all our primary producers. In the early nineties, when the financial position of Victoria was extremely bad. the dairying industry more than any other was responsible for enabling the State to withdraw itself from the abyss into which it had fallen. The subsidy granted for the export of butter enabled the industry to carry on, and at the same time assisted other industries to recover their position. I was anxious that the honorable member for Fremantle should ask that the bounty which he suggested should be provided for the export of butter. As a matter of fact, I had rafted an amendment to the effect that he duty should be reduced as an intimation to the Government that in the opinion of the committee the industry could be more effectively assisted by the provision of an export bounty than by an increase in the duty. It is the export trade of this industry which makes it valuable to the country. If we were only producing sufficient butter for our own requirements, the value of the industry to the Commonwealth would be comparatively negligible.
The dairying industry ought to be a big factor iti the production of wealth in this country. We should try to build up our export trade. One-third of the butter produced can be exported at the present time. We ought really to be producing much more than we consume in Australia. The actions of this Government, and of preceding governments in Australia, have so increased the cost of production that it is difficult to market our produce abroad at satisfactory prices. As was pointed out by the honorable member for Wimmera (Mr. Stewart), we must send our produce to distant markets, and if production costs become too great, it is npt possible to produce at a profit. We mist sell our butter in Great Britain, v in Germany, or other distant countries. At the present time we export, on an average, 100,000,000 lb. -of butter a year.
I hope that the industry will develop, in Western Australia we are producing an enormous quantity of wheat for export. The whole of the south-west is being opened up, and there are areas which should support a large number of dairymen. Under the group system of settlement the dairying industry should be a very large one, but the dairy farmers will have to depend on the export trade. If we keep on increasing the cost of production, it may be possible for the farmer to get a little more for the butter he sells in Australia, but a big proportion of what he produces must be sold overseas at world parity prices. Some honorable members say that this increase in duty will not result in an increase in butter prices in Australia, bin if it does not, what is the use of the duty being pu,t on? If we increase the duty by 2d. or 3d. per lb., we are giving an implied promise to the dairy farmers that they will get 2d. or 3d. per lb. more for their butter. The dairy farmer has the hardest time of any of the primary producers. He has experienced most difficulty in obtaining anything like reasonable prices for his produce. The cost of land, and of production, have been raised against him. We have not obtained any information from the Ministry as to the attitude which the Government proposes to adopt in connexion with the New Zealand reciprocity agreement. The Minister told us to-night that the Government had received word from the New Zealand Government that it wished to keep on with the agreement. It requires six months’ notice for that agreement to be ended. Has the Government made up its mind to denounce that agreement if these duties are imposed? At present New Zealand butter may be brought into Australia for a duty of 2d. per lb.
– If we break the agreement in one particular, the whole thing falls to the ground.
– No, that is not right.
– I am not conversant with the terms of the agreement.
– We have already given New Zealand concessions in connexion with flour.
– The Minister for Trade and Customs has not told the House whether, if this duty is passed, it is proposed to denounce the agreement in regard to the importation of butter from New Zealand. Surely the committee is justified in asking for that, information. If the Minister proposes that a duty of 6d. per lb. is to be imposed on butter coming into Australia in the future, knowing that, under the reciprocal agreement, butter can be brought in for 2d. per lb., he should explain to us how it is going to be done. It is possible that some trouble will be occasioned as a result of the breaking of the agreement, and that the Government will take no action whatever. I pointed out in dealing with the tariff generally that our trade with New Zealand is worth £3,000,000 a year more to us than it is to them. We did a foolish thing in regard to the banana industry. As a. result of that, Fiji will have nothing more to do with us, and now it appears we propose to bring about the same thing in regard to New Zealand. We did a somewhat similar thing in regard to the coffee industry in the Dutch Netherlands. Are we going to have no trade outside Australia at all? Some honorable members talk about freetrade. I would ask them to look up the duties passed prior to 1920 by protectionist governments, and compare them with those passed after that time. The enormous increase in duties will absolutely shock them. The thing we should consider is whether we would be doing most good by giving a subsidy on the export or production of butter, or by imposing duties. It is our export trade which we must retain. If we cannot produce butter here at a cost which will enable it to be sold on the English market, where will the industry be? The conditions imposed by succeeding tariffs, and by all sorts of socialistic legislation, have so increased the cost of production that we must now give this industry some assistance, but that, I consider, is best done by a bounty, not by increasing the duty.
– Will the honorable member give notice of an amendment along those lines?
– If the Government is inclined to view it favorably, it can be clone later. I protest against any increase in the duty. If the Government wishes to help this industry to retain the magnificent market that has been built up overseas, the proper way to do it is by paying a bounty.
.- I did not at first intend to speak on this item, as 1 have no butter producers in my electorate. It is interesing, however, to hear the primary producers arguing amongst themselves as to what the industry needs. It appears that they do not know what they want. It seems to me that this industry is in a most parlous condition, as far as the people actually doing the work are concerned. That is admitted in the evidence placed before the Tariff Board. While that is the position in the industry, it is astonishing to learn, from the figures quoted by honorable members, the value of the butter produced. They all deal in millions. The honorable member for Richmond (Mr. R. Green) informed us that 2,500,000 dairy cattle were used in the industry, and that the output was valued at £45,000,000; that £2,000,000 was invested in factories, and £2,500,000 in machinery. There were, he said, 5,626 employees engaged, who were pai< £1,287,689 in wages, so that the industry is one of great importance to this country. Yet it is now in this unsatisfactory condition, and I do not think any one can say that it is the working man who is to blame.
– No, he has to pay for it.
– Honorable members on that side have said that the working man goes to the Arbitration Court, and gets an increase in wages to cover the extra cost of /living. As a matter of fact, he is the only man who does not get anything out of industry but his bare subsistence wage, and they growl at him for that. We have men here who have the audacity to tell him he is going slow, and who have not 2d. worth of consideration for him.
– The dairy farmer is the greatest, slave in Australia.
– I suggest to the honorable member that the dairy farmer is not the greatest slave amongst the primary producers in Australia. The honorable members on that. side of the committee do not stand for the real hard-working, primary producers. It is the men who go down into the bowels of the earth, and work with bent backs to win the coal, and to serve the interests of the coal barons, who work the hardest, and take the greatest risk. Those are the real primary producers, and they work harder than any dairy farmers do. They may not work for such long hours, but while they are working they do not have an opportunity to straighten their backs. I have every sympathy with the dairy farmer. It has been suggested that we are going to put an extra price on to the consumer, the poor working man, and his wife and children. If the increased duty will make the farmers slightly better off than the capitalists have allowed them to be. up till now, I do not think any working man will grudge paying a little additional recompense to those who ave working hard for a crust. [ do not admit that this increased duty will impose an extra burden on the working man, but if it does he will not squeal nearly as much as will those who to-night have professed to be pleading the cause of the poor, overworked and underpaid farmer. The honorable member for Swan concluded his speech by saying that what Australia wants is a big export trade. If we make the conditions such that the dairy farmers will be able to produce 2 lb. of butter for every 1 lb. produced now, they will have more to export. When they have the goods to export, the market will be waiting for them ; but while they have their noses to the grindstone and cannot improve their herds or pastures, we cannot expect the industry to progress. ‘ I was pleased to hear the honorable member for Indi (Mr. Cook) illustrate what a little socialism can do, even in the dairying industry. The dairymen have come together in co-operative societies, and these societies have been able to take at least one wad out of the purse of the capitalistic cormorants by adopting their own system of insurance instead of buying cover in the open market. By acting co-operatively in this way, the societies and their suppliers are reaping some benefit. We have adopted the same principle in connexion with the Loan Council, in which the States and the Commonwealth have come together co operatively to get the best terms from the money-lender, and they will meet this week to discuss a way out of the mess into which they have got themselves through borrowing too much abroad. So far as I understand the dairying industry, there are seasons when Australia produces more than it requires^ and has a substantial exportable surplus; but during other seasons there is a shortage in the southern market, and instead of the northern producers being able to reap the benefit of an increased price for their produce, in hops the New Zealand producer and captures the trade. We are told that the benefit of this increased duty will not go to the northern producer. The honor able member for Fremantle has let the cat out of the bag. He has declared that it is not Bill Bowyangs who keeps the dairy farmer in a state of poverty ; it is the Sussex-street manipulator who corners the market and fixes the prices to suit his own business. Ultimately the whole community will turn to the policy of the Labour party for the control of the sale of commodities and the regulation of prices in the interests of both producers and consumers. Just as we for many decades have declared that wages must be controlled so that the workmen shall not be at the mercy of the inexorable law of supply and demand, so will the primary producer eventually realize that the Commonwealth Government must take a hand in the marketing of his commodity and ensure him an adequate reward for his labour. Obnoxious as pools were to some people, they were, nevertheless, adopted in a. time of crisis; they are being continued to some extent now, and eventually they will be cuddled to the bosom of their erstwhile opponents; and if they are properly conducted both the consumer and the producer will benefit. Our attitude on this tariff schedule shows that what Labour is trying to do for the working man it is prepared to do for the primary producer. The honorable member for Wimmera (Mr. Stewart) said that ultimately wheat prices would have to be stabilized also. In 1915 I was on the federal executive of the Labour party, and it adopted a proposal that the Commonwealth Government should guarantee to the wheat-grower the basic wage for himself and his family, plus a certain margin of profit in respect of all wheat locally consumed, and find the best market abroad for his exportable surplus. So the idea of regulating and stabilizing a primary industry in order to ensure a living wage to those engaged in it is not new. Changing social and economic conditions will sooner or later compel the more general adoption of that policy. The honorable member for Swan said - “ Consider what the tariff was a few years ago.” I might as well have said to him - “ Look at the knickerbockers you wore as a kid. They do not fit you now.” This debate has been illuminating to me as one who, although not connected with the dairying industry, watches the trend of political and economic events. The honorable member for Lang (Sir Elliot Johnson), who is an ardent single taxer, is “up against it.” He does not want to vote for this d uty, and he is trying to side-step iti ““if he can find a way out of his dilemma he will do so. He may decide to ‘vote against the increase; but the speech he made to-night will enable him during the next election compaign to justify his attitude to his constituents. He said that this duty would burden the consumers, and that there was only one way to make the dairying industry more profitable, and that was to increase the population, so that there would be more people to consume our products. And he is the honorable member who tries to throttle every secondary industry! [ ask the honorable member, and those who share his views, how the population is to be increased by migration if our industries are in the parlous condition in which the dairying! industry is alleged to be. It is certain that no persons coming from the stagnant countries of Europe, and looking to Australia as the promised land, would think of settling on a dairy farm if the conditions of slavery that have been alleged in this committee to-day ‘really exist in the industry. The honorable member’s policy of land taxation and freetrade will not promote primary production, and the present methods of land settlement will not assist to populate Australia. My prophecy in regard to what would be the fate of the measure introduced into the South Australian Parliament by the Conservative Government for the alleged purpose of bursting up large estates has been verified ; the bill received condemnation from D. J. Gordon, and the Legislative Council threw it out. The Legislative Council rejected it. If the secondary- industries are developed as they should be, immigrants will come to this country of their own volition, because they will realize that in Australia a working man is considered to be an entity in industry and not merely a human machine. Consequently, they will be attracted to this country by the standards of living maintained under the tariff. The only way in which we can build up markets for the primary industries is by the development of the secondary industries, and not by fighting the tariff at every turn, because its object is the making of Australia self-contained. Despite the gloomy forebodings of the Jeremiahs in this chamber, no country in the world can show such progress as our statistics disclose. I do not agree with men who say that our standard of living will bring about chaos. Honorable members opposite should sing the praises of Australia, and give every section of the community a fair “ spin.” It will then be unnecessary to seek for immigrants.
– I find myself in a difficulty in regard to this item. The effect of the duty will no doubt be to increase the price of all butter consumed in Australia at least by 3d. a pound. As the honorable member for Adelaide (Mr. Yates) remarked, dairying is one of our best organized primary industries ; in fact, it is the most highly organized of them all. Just as the existing duty of 3d. a pound on butter alone made possible the “ Paterson “ scheme, which has put up the price against the consumer, so will the proposed increased duty of 3d. be taken advantage of by the dairy farmers at an early date.
– I hope so.
– If that is done, Australia’s butter bill will “ be increased by some £2,231,000 per annum. That is the increased cost to the country that this item represents, in so far as it concerns butter,- aud excluding cheese. We all know that in the long run the increase will not be borne entirely by the wage earner or the individuals who actually eat the butter; but it will bc passed on and will inevitably add to the genera! cost of living and to the cost of production, right through the primary and secondary industries. Tt will tend further to clog the economic machine. Therefore, I find the item a difficult one to deal with, but I am not prepared to vote against it. I regard the dairy farmers as a class as deserving of far more sympathy and support from this Parliament than they have received up to the present time. I have said that if the National Parliament had given the primary producers the same measure of practical support that it has extended to the secondary industries, Australia would be incomparably richer than it now is. Those engaged in dairying work more laboriously than any other class in the community. Tt is true that they may not labour under the extreme conditions under which the coal-miner is employed. But the coal miner does not take to his work his wife and little children. He does not toil seven long days in the week, and his work does not entail the breaking of all our canons in industry against child labour, excessive hours and Sunday work all the year round. The dairying industry alfords the best example of cooperative effort in the Commonwealth. The marketing of Australian butter is well done, and therefore it may be said that our dairy farmers have qualified for the sympathy and support of this Parliament. I. do not suggest for a moment that they are all in difficulties; but the men on second class country are having an extremely hard time and getting very little in return for their labour. I might not protest against an increase in the cost of butter to the Australian consumer, if it merely concerned him in a personal sense. An increase in the butter bill of the consumer might not be a very serious matter, because our laws have placed those who labour in the cities in an infinitely better position than that of the toilers in the country. The man who delivers milk to my house every morning probably earns twice as much as the average Australian dairy worker. I am not gravely concerned about the economic effect of the proposed duty on the cost of living and the cost of production in the industrial sphere. The very plight of the industry should, 1 think, make the committee thoughtful with regard to any addition it may make to the general cost of production. Dairying is our third primary industry, being next in importance to wool and wheat growing, and, owing to the high costs of production, it is in an exceedingly enfeebled condition. Although I suppose that it is impossible for the Minister to make any alteration at this stage in the duty proposed, I should have preferred to give assistance to the dairy farmer in a different form from that adopted by the Government. ‘ It might have been done iri two ways. Parliament might have done it by promoting higher profits in the industry. The last figures that I saw showed the average milk product of the Australian cow to be 2,900 lb. per annum. That is the lowest milk product per cow in any important dairying country in the world, the highest being in Holland, where the average milk product per cow is 7,600 lb. per annum. I think that, by the introduction of pure stock into Australia on a large scale, and the improvement of herds with ample compensation to the dairy-farmers, we would have done as much for the industry as Ave are doing now by increasing the duty on butter: but obviously that wouk be a slow method as far as the dairy-farmer is concerned: The only alternate to an increased duty is the payment of ,a bounty on butter for export.
– That has been suggested.
– I am aware of that. If the amendment is not agreed to by the committee, -I shall certainly vote for the item; but I should prefer the payment of a bounty on butter for export, because an increased duty Will inevitably lead to an increase of 3d. per lb. on all butter consumed in the Commonwealth.
Question - That the amendment be agreed to - put. The committee divided
Ayes . . . . S
Noes . . . . . . 55
Majority . . . . 47
Question so resolved in the negative.
Item agreed to.
Item 43 -
By omitting the whole item and inserting in its stead the following item: -
Coffee- ( 1 )Raw and kiln dried, per lb. ; British, free; intermediate, free; general, 3d.
.- This is a. proposal to admit coffee free under the British preferential and intermediate tariffs, and to continue the duty under the general tariff. The report of the Tariff Board on this item has not yet been distributed, but, through the courtesy of the Minister, I was enabled to see a typewritten copy this morning. The inquiry into this item was somewhat different from that into other items. There was no application for an amended duty from anybody interested in the trade. The reference to the Tariff Board was made at the instance, of the department itself. The application was made by the Collector of Customs of Victoria, acting under the instructions of the ComptrollerGeneral. One would naturally assume that the Tariff Board would not raise any serious objection, as the matter is practically one of Government policy. The inquiry was a small one, only one witness appearing in opposition to the proposal.
– It is a reduction of duty.
– It is a reduction on two items, but it is important, as it may have a serious bearing on our trade relations with another country. That is the aspect with which I desire “to deal. This tariff alteration is specifically directed against our trade with the Dutch East Indies. Apparently no evidence was taken embodying the views of those opposed to the imposition as it affects our trade with the Dutch East Indies. The Dutch authorities view the proposal with grave apprehension. The change will impose a duty on all coffee brought into Australia from outside the Empire, while that produced within the Empire will be admitted free. The apparent object is to encourage the use of Indian as opposed to Java coffee. That must affect our trade generally. We have developed a fairly large trade with the Dutch East Indies, and I think that I am correct in saying that the greater part of that trade is with Western Australia.
– There is also a big export of butter from the Eastern States.
– The Dutch East Indies is a very important market for Australian products. We have- captured their markets, even in opposition to Holland, their homeland. Holland had 55 per cent, of the total butter trade of the East Indies in 1913, as against 40 per cent, held by Australia. In 1925 the ratio was, Holland . 6½ per cent, and Australia 93 per cent. In addition to that, owing to the nearness of the two countries, Australia has been able to capture the Java market in bacon, ham, preserved milk, biscuits, soap, confectionery, jam, and other essentially Dutch products. The total value of our trade with the Dutch East
Indies for the five years from 1921 to 1926 was as follows: -
Annual average of imports from Dutch East Indies to Australia, £4,807,000.
Annual average of exports from Australia to Dutch East Indies,£ 2,008,000.
Apparently, a very large unfavorable trade of £2,799,000. But that unfavorable balance was made up almost entirely of petroleum and its products which cannot be procured other than outside Australia, and which represented £2,392,000 of that balance. If petroleum were taken away the unfavorable balance would be practically wiped out.
– What was the nature of our imports?
– Kapok, sisal hemp, rubber, rattan, spices, and things like that. On the other hand, we import from India approximately £6,000,000, as compared with an export to India of £2,000,000 worth of goods, which represents a much greater unfavorable trade balance than that with Java. The effect of this duty will be to increase our unfavorable trade balance with India, and it will seriously affect our trade relations with Java. At a time when it, is becoming more and more difficult for us to find markets, because of our high cost of production, it is a grave mistake to jeopardize a trade such as we have with the Dutch East Indies, especially as it will not benefit us to do so. The effect of the duty will be to encourage the use of Indian coffee as against Java coffee, and so increase the cost of coffee to our consumers. The price of Indian coffee to Australia is1s. 4d. per lb., while the price of Java coffee is about11d. per lb. Admittedly the Java coffee is of an inferior quality, but large quantities of it are used for blending. In the future the blenders will be obliged to use more of the expensive coffee than is required to market a reasonably good article. But that is not the most serious aspect of the subject. The Dutch East Indies has no tariff carriers against us, Holland is one of the few freetrade countries of the world, and has had the experience of seeingus cut into her trade with her own colonies. If we put the Dutch East Indies in an unfavourable position as against India in respect of coffee it is quite likely that retaliatory measures will be adopted against us. In fact that has been threatened. Dutch East Indies interests are at present placing new and large steamers on the Australia-Java-Singapore run with refrigerated space for meat and this service in addition should be of considerable assistance to our mandated territories ; but if we cut into the existing trade the service may not be continued. We may, in fact, have a repetition of our experience withFiji. Our Pacific Islands shipping facilities have been unsatisfactory for a long while and it would be regrettable if we were to do anything at this stage to hinder the prospects of improving them, but I am afraid that that may be one of the effects of this alteration in our tariff schedule. Even if the alteration improved our trade with India it would increase our unfavorable trade balance, and in all the circumstances I submit that there is no justification for it. Any benefits that may arise from it will undoubtedly be offset by disabilities which must follow. It would be highly regrettable if the alterations were to lead to retaliatory trade measures by the Netherlands East Indies interests.
– How much coffee do we import from India, and how much from Java?
– Out of a total importation of 2.910,332 lb. in 1924-25 . and 3.754,384 in 1925-26, Netherlands East Indies supplied no less than 1,504,483 lb. and 2,062,022 lb. respectively and India 777,139 lb. and809,160 lb. respectively. The proportion is therefore roughly 2½ to 1 in favour of Java.
– Why does not. the honorable member say that this is a proposal for a reduction and not an increase in the duty on certain classes of coffee?
– I submit that while there is a reduction in the duty on coffee from India there is no alteration in the duty on it from the Netherlands East Indies, and that consequently it may cause retaliatory measures to be adopted. I am afraid that it will have the effect of causing an entire cessation of the coffee shipments from Java to Australia.
Mr.Fen ton. - We did not suffer when the shipments of Java sugar to Australia ceased.
– Unfortunately we suffered severely. We lost a valuable trade with Madagascar and the East in consequence of our sugar policy. I urge honorable members to vote against this proposal.
– In order to clarify the issue I wish to inform the committee that this is a proposal by the Government for a reduction, in the duty on coffee grown within the Empire, which will mean a loss of revenue on the basis of the imports last year of about £15,000. The information that I have is that Kenya, Indian and other Empire coffees are superior in quality to the Java coffee, although dearer. The honorable member for Perth (Mr. Mann) stated that Indian coffee was valued at 1s. 4d. per lb., and Java coffee at about 10d. perlb. Theeffectofthis alteration will thus be to reduce the price of Indian coffee to1s.1d. per lb. and leave unaltered the price of Java coffee. In other words Indian coffee will be cheaper than it is now and Java coffee will be no clearer. I regret that there has not been time to have the report of the Tariff Board on this item printed. It only reached me this morning.In regard to the Java trade the board reports -
No evidence was tendered to indicate that the reduction of the duties (as distinct from the question of extending the preferential tariff) would prejudicially affect any Australian industry, and in the circumstances, the Tariff Board expresses the view that apart from the revenue aspect there is no reason why the proposed reductions should not be made.
I interpolate at this point that the Government, and not the Department of Trade and Customs, as suggested by the honorable member for Perth, submitted this matter to the Tariff Board for consideration. The report proceeds as follows -
On the question of the proposal to provide for the admission under the British preferential tariff of coffee raw and kiln dried when produced in any part of the British Empire, the board considers that the likelihood of any retaliatory measure on the part of the Netherlands East Indies is remote. The existing position as regards the trade in this line justifies the proposed extension of the preference and as regards the two sub-items mentioned by the witness who anticipated retaliation (namely biscuits and butter) the board is of opinion that the proximity of Australia to Netherlands East Indies and the effect of that proximity on the quality of the products will assure the Commonwealth retaining its share o’f the trade. In any case the fact that, the balance of trade between Netherlands East Indies and the Commonwealth is so largely in favour of Netherlands East Indies, would it is considered, deter that country from taking any steps likely to interfere with its existing favourable trade position.
The proposal really extends the provision with regard to coffee from Papua and New Guinea to other parts of the Empire, and should have the affect of reducing the price of coffee to the Australian consumers. Therefore I have no hesitation in recommending it to the committee. The importations into Australia from the Netherlands East Indies totalled about £5,250,000last year and included the following items : - Coffee, £93,000: fibre, £99,000; kapok, £395,000; kerosene, £138,000; crude petroleum, £439,000; benzine, petrol. &c, £2,628,000; crude rubber, £242,000; and tea. £1,783,000. Coffee therefore is a minor importation. It seems to me that a proposition of this sort should appeal to the House for several reasons. One reason is. that it is a reduction of duty of £15,000. It will admit the good coffees of the Empire into Australia at a lower price. The third reason is that surely we, as a Parliament, have the rightto make some gesture of friendship to our Empire in this matter.
.- The honorable member’s arguments are not, to my mind, convincing. Our trade relations with the Netherlands in the East Indies “have become tremendously restricted already by the fact that they are traditionally a freetrade people giving us open ports for our commodities, while we set up what is practically an embargo against the importation of sugar, and have imposed a duty of8s. 4d. a cental on bananas. The previous trade relationship was highly favorable to Australia. It is a good thing to try to carry out the policy of promoting Empire trade, but I think our reciprocity with India is already substantial. Practically, the- whole of our jute goods now come from that country. We have the right to conserve our own markets, and our own trade. If we do what is proposed to be done here, we shall strain existing trade relations with a valuable customer. As the memorandum of the ConsulGeneral of the Netherlands states, the. present movement furnishes an opportunity of strengthening the already strong political movement in Holland to depart from its traditional freetrade policy, and to show that the dangers are not imaginary, it may suffice to state that such legislation is actually under contemplation. Holland’s share in the import trade of its own Eastern dominion, which in 1910 amounted to 30 per cent., has since 1920 dropped in successive years to 25 per cent., 23 per cent, 21 per cent., 19 per cent., and IS per cent. That trade has all been taken from their own mother country by Australia. It shows that Australia is a competitive exporting country, and has played a role of importance in the diversion of trade, as illustrated ‘in the figures relating to the butter trade. The mother country has lost that trade., and, in this connexion, the comparison of figures as between 1913 and 1925, contained in the official statistics, is particularly illuminating. In the former year Holland supplied 55 per cent, of the total, and Australia 40 per cent., while the ratio in 1925 was: Holland, 6^ per cent.; and Australia, 934 per cent. We cannot lightly offend such a customer.
– We bought nearly £2,000,000 worth of tea from Java.
– We could not very well buy it elsewhere, but Java could restrict its imports from us. If, for instance, it put a tariff against our butter, we could not easily find another market for it.
– I think just the reverse is the case.
– In the circumstances I have mentioned, it is strongly felt that coffee from Netherlands India, should be admitted upon the same terms as coffee from elsewhere; either the duty should be abolished - which would resultin cheapening the price of coffee to the consumer by approximately 3 1/2 d. per lb. - or, if for financial reasons this sacrifice cannot be made, the duty should remain at 3d. in both the British and general tariffs. That is the contention of a cus- tomer who very properly appeals to us not .to do a foolish thing. It is, perhaps, not superfluous to forestall the possible rejoinder that the present trade position between the two countries shows a balance in favour of Netherlands India. An unbiased examination of the statistics reveals the fact that the imports from Netherlands India consist wholly of raw materials and foodstuffs, which are (a) non-competitive, both as regards Australian economic activities and in relation to trade from other parts of the Empire, mainly owing to their typical qualities and attractive prices - tea, for instance; and (&), which are essential to Australian industry. As to (a), the movement of trade, according to the official federal figures for the period 1921-26 was : - Annual average imports from Netherlands India, £4,S07,746; annual average exports from Australia to Netherlands India, £2,008,529. The balance of £2,799,217, is accounted for by the importation, of oils, of an average value of £2,392,893 for the last five years, for which at present only foreign sources of supply are available. Oils do not injure Australian industries, and if they are excluded, the trade between the two countries practically balances. As to (&), kapok, sisal, rubber, rattans, and spices, they are used in large local industries, which, owing to the high manufacturing cost, must be able tcbuy in the cheapest and nearest possible market. I wish to emphasize the fact that Western Australia,, at any rate, has already received many hard blows through the- operation of the tariff. State legislators have visited Java and endeavoured to develop trade between that colony and Western Aus-, tralia. The Hon. J. Scaddan reported on his return to Perth after a trip to Java that when he suggested that the Dutch people should buy more of Australia’s products they replied, “ We could, but we do not propose to do so, because Australia is unfriendly. We give you a free port for the goods you send to us, and you place an embargo against everything we could send to you. That is not fair. We could do better for ourselves by opening up trade relations with other countries.” That was no idle threat. Canada and the United ‘States of America are making strenuous efforts to capture the trade of Java. The Dutch are prepared to send fast steamers with refrigerated space to Australian ports, and their representatives were in Perth some time ago trying to make arrangements for the carriage of beef from the north-west of Western Australia. Such a service on the coast would help the development of Western Australia more than anything else that I can think of. The Dutch shipping companies would be sparing us the expense of providing shipping facilities on the north-west coast, and would be carrying under the most advantageous conditions our exportable products. I am not averse from encouraging trade within the Empire, but we should not be asked to sacrifice other customers to that end. This Parliament made a fatal mistake when it placed an embargo upon Fijian bananas, and thereby lost a valuable trade, which showed a balance of £500,000 in favour of Australia. I appeal to the committee to allow the duty on coffee to remain unchanged.
.- Naturally I am pleased to see a reduction, however small in a revenue duty.
– It is not an effective reduction when the duty against one country remains unaltered.
– The Minister has said that the alteration means a reduction of £15,000 in the revenue from this duty. But I think that when the Government was altering this purely revenue . duty, it should have removed it entirely; the amount involved is only £60,000 or £70,000. The Government is in the most haphazard fashion introducing a startling innovation in preferential trade. Hitherto preference has been confined to trade with Great Britain or other parts of the Empire with which we have made special reciprocal treaties; but now, at a moment’s notice, and without explanation, the Minister proposes to give a preference to the products of the Crown Colonies of the Empire and the Indian Empire. No reciprocity is suggested. This is a most important departure. If the preference is to be of any benefit to India, unquestionably it will involve an increase in the cost of living in Aus tralia. In respect of the matter of such outstanding importance as preferential trade within the Empire, we should have had more notice of the Government’s intention than is given in this seemingly innocent amendment of an existing tariff item. We have to consider also the probable effect of this alteration upon the coffee-growing industry of Papua and the Mandated Territory. Only a year ago the Minister obtained parliamentary approval of -a proposal to give coffee growers in those territories a preference of 3d. per lb. over competitors in other parts of the world. Until the 1st April, 1926, when that alteration became operative, a duty of 3d. per lb. was imposed ou all coffee, whether from Papua, the Mandated Territory,” or elsewhere. It is quite likely that in the meantime the planters in the territories have been encouraged by this preference to make financial commitments, and I ask the Minister to tell the committee whether that aspect of his policy has been considered. By this grant to Crown colonies and India the 3d. preference which was specially devised to encourage coffee growing in Papua and the Mandated Territory only a year ago, is to be swept away. It is an act of political bad faith against the planters in the territories under eur control. I hope that the Minister will give us an explanation.
.- The Minister claims that he is remitting revenue duties to the extent of £15,000 per annum, and reducing prices. How can he contend that, and at the same time claim that he is giving preference to Indian growers? He cannot have it both ways. The Indian growers will immediately adjust their prices to meet the tariff. There will be no reduction in the cost of living and no remission of revenue duties.
– We already import coffee weighing 1,000,000 lb. from other parts each year.
– In 1924-25 we imported from Netherlands East Indies 2 lb. of coffee to every 1 lb. imported from India, and in the following year 2- lb. to 1 lb. The duty on coffee from the Netherlands East Indies is to remain.
The result will be that the country to which preference is given will adjust its price to keep it a little below that margin of preference. That immediately takes from the Minister the strength of his argument that he is reducing butter prices. He is not doing so. He is maintaining a definite duty, protective in incidence so far as British India is concerned, and a revenue duty so far as Netherlands East Indies is concerned.
– Seeing that we now are importing nearly 1,000,000 lb. of coffee from the British Empire under a 3d. per lb. duty, the remission of that duty must mean a concession to the Australian consumer.
– Not while the other duty remains operative. No one knows better than does the Minister the movements of trade. He knows that the country to which preference is granted will immediately accommodate its price within the margin of 3d.
– I have already quoted prices, which have not been disputed, showing that the price of Empire coffee is now very much higher than that of Java coffee.
– But the Empire grown coffee will keep its margin of profit as close as possible to the duty imposed on Java coffee.
– There is a margin now of over 6d. a lb.
– There is a difence between the qualities of various coffees. These things accommodate themselves according to quality and the margin of preference. The honorable member for Henty (Mr. Gullett) referred to the effect of this item on coffee production in the mandated territories under our control. The opportunities for developing payable industries in those territories are limited. The margin of profit in the coffee industry there must be small because wages are low. To grant growers almost side by side with them a margin of 3d. a lb. is to throw the whole industry into chaos. I desire to point out that I have not been approached by any one, nor have repre sentations been made to me in this matter. I saw in the proposal what might be regarded as an unfriendly gesture to a country with which we have always had harmonious relations - a ‘ country, moreover, that permits Australian products to enter on exactly the same terms as do the products of its own parent country, whereas we impose a . tariff against its products. I admit that the balance of trade is in favour of the Netherlands East Indies, but the conditions are different. The honorable member for Henty also pointed out that the Government’s proposal is a departure from the usual trade relations between two dominions. Generally, an alteration in duty is the subject of agreement between the two dominions concerned. That is not so in this case. The action of the Government will have a detrimental effect upon trade that we should do our utmost to capture. At almost any cost we should aim at capturing the trade of the hundreds of millions of people close to us instead of causing them to entertain unfriendly feelings towards us. I had intended to move that the duty be wiped out, but I shall not do so now. I should, however, like the Government to take the lead in that direction. No important question of policy is involved in this matter. I should not take this stand if the Government’s action were actuated by a desire to advance a British industry. I congratulate the Minister on the concessions he has made to British trade. Generally, I agree with him, although in some cases Australian industries have been slightly affected. Australia owes so much to the Mother Country that we should go a long way in the direction the Minister has gone; but I cannot agree to this item.
.- The honorable member for Henty (Mr. Gullett) drew attention specifically to a measure introduced last year, and he implied that a promise was given to growers in Papua and New Guinea to induce them to produce coffee there that their produce would be free of duty on entering Australia. It is now proposed to make them compete with India and other countries. What I particularly protest against is that a new policy has been laid down, without previous notification, of giving preference to other parts of the Empire apart from Great Britain. “ The Minister desires to give special preference to India. We should not forget that we have invited those who are making plantations in New Guinea and Papua to compete on level terms.
– Does the honorable member know of any plantations there?
– I saw a little coffee being grown in New Guinea. Our gesture to our kith and kin across the seas that we desire to build up reciprocal trade is mere hypocrisy when our tariff schedule contains such heavy duties as those imposed on clothing and on iron and steel. We only need to read the British press to learn how that gesture is accepted in the Old Country. About eight or ten years ago the Netherlands supplied Java with almost the whole of its butter; but to-day Australia suppplies over 90 per cent. of the butter requirements of that country, and the Netherlands has lost the. trade of her own colony. Will it not follow, as day succeeds night, that if We give a special preference to encourage trade with India as against Java, the Netherlands Government will insist on higher, duties on Australian products entering Java?
– If the honorable member is permitted to re-open the subject of the butter trade, we shall be here all night.
The CHAIRMAN (Mr. Bayley).The honorable member for Swan i3 perfectly in order. He is endeavouring to show that the export trade will suffer as a result of the Government’s proposal.
– There is danger in building up a tariff wall that will cause a repercussion elsewhere. Are not reciprocal treaties made with other countries for the purpose of promoting trade? In Western Australia we have built up a fairly large trade with Java, and I do not wish to have it destroyed. The impression exists in Java, I am led to believe, that the object of this duty is to destroy its coffee trade with Aus tralia. I should like the Government to make the item duty free. In a new departure of this description we should make it clear that the concession applies only to the produce of Papua and New Guinea.
– So the honorable member does not want a reduction of the duty?
– Assuming that we do not expect to build up a trade with New Guinea and Papua, let us make the item free. I do not think that Ave shall get any benefit from India.
– Is not the whole purpose of the tariff to get good coffee more cheaply ?
– But certain ‘persons cannot pay the higher price charged for it.
– Can the honorable member say where the best coffee is grown ?
– I do not know, and I doubt if the honorable member himself can say. I do not wish to move an amendment to the item. I hope, however, that the Government will not make this new departure in policy without giving Parliament an opportunity to express its opinion, because I feel sure that, if given effect, it will injure the trade between Western Australia and Java.
– The proposals of the Government will not mean an increase in the price of J ava coffee. They should lead to a lowering in the price for the best class of coffee, and will not injure our trade with Java, except to- the extent that the people of Australia drink the better class of Empire coffee. I hope, therefore, that the committee will agree to the item.
.- I am not so much concerned about what may happen, to our trade with Java, which appears to be exercising the mind of the honorable member for Swan (Mr. Gregory). I am, however, somewhat concerned about the effect which, these new duties will have on previous legislation introduced by the Minister for Trade and Customs with the idea of encouraging primary production in New Guinea. That legislation was approved by Parliament, which was unanimously of the opinion that certain concessions” should be given to producers in the mandated territories. It seems to me that these proposals represent a volte face on the part of the Government. I hope that the Minister will give a more detailed explanation as to the position and state whether or not it is the intention of the Government to foster coffeegrowing in the Territory of New Guinea and Papua, I confess that I do not know how much coffee is grown there, but the Minister should know, in view of the fact that he is now asking the committee to agree to drastic proposals which may affect materially the position of coffee-growers in New Guinea. Especially should I like to have an assurance from him that the adoption of the duties in this item will not endanger the industry in those territories.
.- The Papua and New Guinea Bounties Act, . passed at the instance of the Minister for Trade and Customs last year, removed the duty of 3d. per lb. payable on coffee grown in Papua and the mandated territory of New Guinea. On that occasion the Minister dwelt at some length on the suitability of those two territories for the production of coffee and made a special appeal for preference being given to coffee-growers there against coffeegrowers elsewhere within the British dominions.
.- The statement has been made that the Government proposals clash with concessions given last year to potential coffee producers in Papua and New Guinea. So far as I know there have been no developments of importance in that line of production in the territories mentioned. Our importations of coffee last year amounted to nearly 4,000,000 lb. The duties on this item will affect importations to the extent of 1,250,000 lb. There is still a considerable margin in the Australian market for coffee grown in either Papua or New Guinea, as there is also in regard to the price of coffee that will be imported from India or Kenya. The Government’s proposal will mean a reduction in customs duties to the extent of £15,000 a year. I really cannot understand the attitude of certain honorable members. They wish the duties on some items to be reduced, and when the Government offers reductions on other items, they are disinclined to accept them. I question if these proposals will affect to any extent the production of coffee in Papua or the mandated territory of New Guinea. As I stated previously, -the Government’s proposals will mean a reduction of 3d, per lb. in the price of the better class of coffee imported.
Item agreed to.
By omitting the whole of the item (c) and inserting instead the following sub-item: -
– This item was inserted to rectify an anomaly as between starch flour and cornflour. I have been informed that in its present form it will create a further anomaly, and will disturb the equilibrium elsewhere in the schedule. I propose to make further inquiries. I ask, therefore, that the item be postponed. .
Bill returned from the Senate without amendment.
Bill returned from the Senate, without amendment.
Motion (by Mr. Bruce) agreed to -
That the House at its rising adjourn until 11 o’clock a.m. to-morrow.
Public Accounts Committee - Report on Tasmanian Communications.
That the House do now adjourn.
For the information of honorable members I desire to announce the decision of the Government regarding the report that was recently submitted by the Public Accounts Committee in connexion with communications between Tasmania and the mainland. The question of the provision and maintenance of a satisfactory steamer service between Tasmania and the mainland of Australia has been under the consideration of the Government for some time. We recognize that such a service must cater for the tourist traffic as well as provide effective transport for mails and cargo. The Committee of Public Accounts has investigated these questions very thoroughly, and has presented a report which deals comprehensively with all phases of this subject. The Government has given very close consideration to the committee’s report, and to the recommendations which were made therein with a view to improvement in the means of communication between Tasmania and the mainland. The committee’s first recommendation is that the coasting trade sections of the Navigation Act be repealed. Section 286 of the Navigation Act gives power to the Governor-General to permit unlicensed ships of such size and speed as he may determine to be exempted from the provisions of the act to cater for tourist traffic between the mainland and Tasmania^ and acting on ‘the provisions of that section the Governor-General in December of last year issued a notice that unlicensed British ships of at least 15 knots were exempted from the provisions of the Act insofar as the carriage of passengers between Hobart and the ports of Brisbane, Sydney, and Melbourne was concerned during the period 1st January to 31st May, 1927. A similar course was followed in the previous year, the period covered by the exemption being 6th March to 31st May, 1926. The Government is’ of opinion that the question of the coastal sections of the Navigation Act and their effect on trade and commerce in Australia is too wide to be, decided upon the issue of trade in a particular part of the Commonwealth. The Government is giving consideration to this wider aspect of the question, and at a later date will indicate its policy thereon. The second recommendation is that the mail contract with the Orient Steam Navigation Company be amended to provide for an addi- tional call at Hobart during the peak of the tourist season when interstate passengers should be carried.
The present contract with the Orient Company provides for the mail steamers on their homeward trip to make at least three calls annually at Hobart during the months of February to May inclusive. The Orient contract costs the Commonwealth £130,000 per annum, and to arrange for an additional call at Hobart as recommended by the committee, would, it is anticipated, involve a very considerable increase in the subsidy. Very little additional return in the shape of freight or passenger traffic would be received by the company and from a mail standpoint no benefit would be gained by the public of Tasmania. In view of this, the Government is of the opinion that the advantages to be derived by Tasmania from an additional call by Orient vessels would be in nowise commensurate with the cost, and that the increased expenditure involved would not be justified.
With reference to the recommendation concerning the service between Sydney and Hobart it should be pointed out that at the time the committee’s investigations were made a fortnightly service was in operation. Subsequently, however, a service of weekly frequency was inaugurated and it has been ascertained from the owners of the vessel now engaged in the service that it is their intention to maintain the weekly frequency up to the end of next March, provided trade conditions continue to justify the sailing. The Government considers that a service of weekly frequency should reasonably meet requirements and that the heavy expense which would be involved in arranging for. a more frequent service during the tourist season would not be justified under existing circumstances. The committee’s recommendations in relation to the Bass Strait service, which are set out on pages 17, 18, 19 and 20 of the report, have been given very full consideration by the Government as it realizes that it is this service which will carry the bulk of the traffic. The present contract, which carries a subsidy of £30,000 per annum and is terminable upon twelve months notice, covers two services, namely, from Melbourne to
Launceston, and from Melbourne to Burnie and Devonport. The Melbourne to Launceston service has a frequency of thrice weekly during the period 16th September to 31st March, and twice weekly during the remainder of the year. The Melbourne to Burnie service is twice weekly both in summer and winter. Under the contract the vessel on the Launceston service is required to maintain an average speed of 15 knots in average weather between Gellibrand Light and Low Head, and the vessel on the Burnie service an average speed of 13 knots between the Light and Burnie. Each of the vessels used under the contract is a coal-burning vessel. The vessel on the Launceston service usually leaves Melbourne about 4 p.m. and that on the Burnie service at midday. Owing to the shallowness of the river Tamar between Rosevears and Launceston, the time of the arrival of the steamer at Launceston is dependent on the condition of the tide. In winter it is also affected by fogs, which are very prevalent at that time of the year. The river from Low Head to a point about 12 miles from Launceston has, however, sufficient depth of water at all times for steamers such as those at present used in the service. So far as the Launceston route is concerned, the committee considers the service should continue as at present until better facilities for shipping are available in the river Tamar, but in regard to the . Burnie route a service of thrice weekly frequency in the summer and twice weekly in the winter is recommended.
The Government is impressed with the desirability of improving the frequency of the Bass Straits service during the summer season, and for the employment of a more efficient and faster vessel on the Burnie route. It has also formed the opinion that a much improved service could be given if the difficulty in connexion with the tides at Launceston were overcome by terminating the service at some point on the river near Rosevears, where there is deep water, provision being made for- linking such point with the railway system of the State. It is accordingly proposed to invite tenders early in the new year for services as follow : -
Service No. 1 -
Route. - Between Melbourne (or Port Melbourne) and a point on the River Tamar near Rosevears, where there is deep water.
Frequency of Service. - Thrice weekly in summer. Twice weekly in winter.
Speed of Vessel. - The average speed to be maintained by the vessel to besuch as to enable the trip each way to be performed within sixteen hours.
Time-table. - Leave Melbourne 5 p.m., arrive Tamar port9 a.m.; leave Tamar port 4 p.m., arrive Melbourne 8 a.m.
Service No. 2 -
Route. - Between Melbourne (or Port Melbourne), Burnie and Devonport.
Frequency. - Thrice weekly insummer. Twice weekly in winter.
Speed of Vessel. - The average speed to be maintained by the vessel to be such as to enable the trip each way to be performed in fourteen hours.
Time-table. - Leave Melbourne 4 p.m., arrive Burnie 8 a.m.; leave Burnie 8 p.m., arrive Melbourne 10 a.m.
The Government does not propose to stipulate that oil-burning vessels shall be used on the service, but will give preference to tenders which contemplate the use of such’ vessels. It, however, intends to provide . that the vessels used under the contract shall be suitable’ for passenger traffic and freight, as well as for the conveyance of mails.
The committee expressed the opinion that the early inauguration of a subsidized aerial service between the mainland and Tasmania should be seriously considered with a view to its establishment as soon as efficient and suitable machines can be procured. In considering this question, it must be remembered that the vessels conveying mails between the mainland and Tasmania travel the greater part of their journey during the night time. Aeroplanes would have to travel in daylight, and the time-table would have to be arranged with due regard to the difficulties on account of fogs which are prevalent during the winter. This proposal is to be further investigated with a view to obtaining the additional data which is necessary before a decision as to the advisability of establishing the service can be reached.
.- I regret that the Prime Minister has made- such an important statement to the
House at this late hour. His action was hardly fair to honorable members, and certainly not to the Opposition. I have not been supplied with a copy of the statement, and I came here to-night without expecting it. It is. an important statement, and I venture to say no honorable member can gather from the right honorable gentleman’s remarks just how farreaching the effect of the Government’s decision may be. The Opposition have not had an opportunity to decide whether the Government’s proposals should have its support. We all recognize, however, that Tasmania’s isolated position entitles her to improved shipping facilities to place her in a similar position to the States which have railways for interstate communication. In order to achieve that objective I have frequently suggested that the Commonwealth should establish and control a line, of steamers to serve that State. Although I followed the Prime Minister very closely I do not know what is actually proposed.
– If the Government’s proposals arc adopted Tasmania will get an extra boat each week.
– If the subject is of grave importance we shall have to exercise our rights, even if we remain here next week, in the interests of the whole Commonwealth. I protest against such an important statement being made without the Opposition being informed of its purport.
– I am sorry that the Leader of e Opposition (Mr. Charlton) is under the impression that the statement which I have made will in any way embarrass the Opposition.
– Will the right honorable gentleman supply me with a copy of it? .
-I shall do so now. I have merely indicated the action whioh the Government proposes to take in consequenoe of the report submited by the Public Accounts Committee. It is a mere announcement of policy.
– But something may be done by an administrative aot.
– The Government merely proposes to call for tenders for an improved service between the mainland and Tasmania.
– It is not likely to be in operation for fifteen months.
– The existing contract has still a fairly long time to run. The statement I have submitted is an ordinary announcement such as the Government makes from time to time concerning matters of policy, and would have beenmade public in the ordinary way if Parliament had not been sitting.
– Will -the Government’s proposals come before the House for consideration before tenders are oalled, or any other action taken?
– The terms of the contract will not be submitted to Parliament. As honorable members are aware, the Government has been subsidizing a mail service to Tasmania for a considerable time, and it now proposes to change the basis on which the subsidy is paid. There is no intention of submitting the matter to Parliament for decision. The Public Accounts Committee has submitted its recommendations, and the Government has now decided upon the policy it is to adopt.
Question resolved in the affirmative.
House adjourned at 11.55 p.m.
Cite as: Australia, House of Representatives, Debates, 13 December 1927, viewed 22 October 2017, <http://historichansard.net/hofreps/1927/19271213_reps_10_117/>.