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House of Representatives
10 June 1931

12^th Parliament · 1^st Session

QUESTION
- LOANS
QUESTION
- PRICE LEVELS
WESTERNPORT NAVAL BASE
- Personnel
QUESTION
- GOLD SALES
QUESTION
- BANKRUPTCY ACT
QUESTION
- POET AUGUSTA TO BED HILL RAILWAY
QUESTION
- TELEGRAPHIC TRANSFERS ON LONDON
QUESTION
- CRIMES ACT
QUESTION
- PUBLIC SERVICE
QUESTION
- DUTY AND EXCISE ON SPIRITS
QUESTION
- CUSTOMS DEPARTMENT
PAPERS
TARIFF
ADJOURNMENT
- Price or Explosives

Mr. Speaker (Hon. Norman Makin) took the chair at 3 p.m., and offered prayers.

page 2599

QUESTION

LOANS

List op Bondholders.

Mr NAIRN:
PERTH, WESTERN AUSTRALIA

asked the Treasurer, upon notice -

Will he have prepared a statement (on the lines of a statement of Australian bondholdings published about the 10th November, 1930), showing as nearly as practicable the classes of institutions and persons in (a) Great Britain, and (b) America, who hold Australian bonds; and particularly showing the respective portions held by such institutions as banks and/or finance companies, trustees (if available) and small investors?

Mr THEODORE:
Treasurer · through Mr. Holloway · ALP

– It is to be regretted that the material necessary for the compilation of the desired information is not available.

page 2599

QUESTION

PRICE LEVELS

Mr TULLY:
BARTON, NEW SOUTH WALES

asked the Treasurer, upon notice -

Is it a fact that the great-fall in prices occurred in Great Britain in 1920?
Is it a fact that deflation began in 1921?
Is it a fact that the period of the greatest fall in prices coincided with the period of the greatest expansion in currency?
Is it a fact that inflation to the extent of 18 per cent, during the three years ended 1922 was accompanied in Japan by a fall in prices of no less than 43 per cent.?

Mr.THEODORE (through Mr. Hol- loway). - The answers to the honorable member’s questions are as follow: -

No; this occurred in 1921. The wholesale price index numbers for 1919, 1920, and 1921, were, respectively, 2,351, 2,832, and 1,810.
Yes. The weekly average amount of bank notes and currency notes issued in Great Britain in the fourth quarter of 1920 and 1921 was as follows: - 1920, £519,832,000; 1921, £466,092,000.
No. See answers to 1 and 2.
Bank notes in circulation at the end of 1919 and 1922 were practically the same in amount, the figures for 1919 being 1,555,100,523 yen, and 1,558,402,247 yen tor 1922. The wholesale price index for 1919 was 2,359, and 1,958 for 1922, a decrease of 17 per cent, on the figures for 1919.

page 2600

WESTERNPORT NAVAL BASE

Personnel

Mr CROUCH:
CORANGAMITE, VICTORIA

asked the Minister for

Defence, upon notice -

How many of each of the respective ranks of the naval forces were stationed at the naval base at Westernport on the 1st June, 1931, viz.: - (a) Officers; (6) warrant officers; (c) petty officers; and (d) other ranks?
Of these, how many of each ranks received their first training (a) in Australia, and (6) elsewhere?

Mr.CHIFLEY. - The answers are contained in the following table: -

page 2600

QUESTION

GOLD SALES

Mr TULLY:

asked the Treasurer, upon notice -

Is it a fact that the Bank of England is bound by law to sell gold at £4 4s.11½d. an ounce?
Is it a fact that a similar law does not exist in any other country?
Is it a fact that Germany boughtall the gold in the London market in January, 1930, at £4 4s.11¼d. an ounce?
Is it a fact that Great Britain can only buy gold when others do not particularly want it?
Is it a fact that the most unstable money market in the world is in England?

Mr THEODORE:
through Mr. Hollow ay · ALP

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

The law requires the bank to sell standard gold at £3 17s.10½d. per ounce, which is the equivalent of £4 4s.11½d. per ounce of fine gold? 2, 3, 4, and 5. I regret that I am unable to make an authoritative reply to these questions.

page 2600

QUESTION

BANKRUPTCY ACT

Fees

Mr HAWKER:
WAKEFIELD, SOUTH AUSTRALIA

asked the AttorneyGeneral, upon notice -

Whether he has received any protests or complaints as to the excessive fees charged under the Bankruptcy Act for (a) registering or filing a chairman’s certificate, and ( & ) registering or filing a deed of arrangement, or as to the excessive commission charged on insolvent estates which are not administered by the official receiver, but by a trustee under the Bankruptcy Act?
If so, has any consideration been given to such protests, and has any action been taken to reduce harsh charges?

Mr BRENNAN:
Attorney-General · BATMAN, VICTORIA · ALP

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

Yes.
The matter was early in 1929 discussed by the then Inspector-General with representatives of chambers of commerce and other bodies in South and Western Australia, and it was not considered that any reduction of fees could be made if a reasonable relation were to be maintained between costs of administration and revenue.’ Since the honorable member made representations for the reduction of the fees payable under the Bankruptcy Rules, the matter has been further considered,but, in view of the reasons already mentioned and of the existing financial position, I am unable to recommend any reduction of the fees in question at present.

page 2600

QUESTION

POET AUGUSTA TO BED HILL RAILWAY

Mr MACKAY:
LILLEY, QUEENSLAND

asked the Minister for Transport, upon notice -

Has there been any Commonwealth expenditure on the building of the proposed Red Hill-Port Augusta railway? If so, what is the nature of the work, and the total cost?
Has his attention been drawn to a press telegram from Adelaide, which reads - “The report of the royal commission on the railways of South Australia strongly opposes the building of the Red Hill-Port Augusta railway. The report states that under the most favor- able conditions the line would result in a loss of £90,000 a year, and adds that the outlook for the State railways is worse than ever before” ?

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

– The answers to the honorable member’s questions are as follow : - 1.No.

No. But I am aware that the royal commission referred to has reported unfavorably on the railway. The Commonwealth Parliamentary Standing Committee on Public Works has, on the other hand, reported favorably on this railway proposal, and its construction is estimated to result in a profit of £6,000 per annum to the Commonwealth, based, of course, on normal traffic conditions. However, owing to financial stringency, the Government has decided that the construction of this railway is to remain in abeyance.

page 2601

QUESTION

TELEGRAPHIC TRANSFERS ON LONDON

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

asked the Treasurer, upon notice -

In connexion with the Australian banking and exchange situation, can he state -

What was the buying rate per cent, for telegraphic transfers on London for - (a) March, 1930; (b) October, 1930; (c) January, 1931; and (d) June, 1931?

What was the selling rate per cent, for the same dates?

Mr THEODORE:
through Mr. Holloway · ALP

– The answers to the honorable member’s questions are as follow: - 1. (a) March, 1930 - 1st to 9th, £2 10s. per cent; 10th to 23rd, £3 10s. per cent.; 23rd to 31st, £6 2s.6d. per cent. (b) October, 1930- 1st to 8th, £6 2s. 6d. per cent.; 9th to 31st, £8 10s. per cent.; (c) January, 1931 - 1st to 5th, £8 10s. per cent.;6th to 12th, £15 2s. 6d. per cent.; 13th to 16th, £18 per cent.; 17th to 28th, £25 per cent.; 29th to 31st, £30 per cent, (d) June, 1931 - £30 per cent. 2. (a) March, 1930- 1st to 9th, £3 2s. 6d. per cent.; 10th to 24th, £4 2s. 6d. per cent.; 25th to 31st, £6 10s. per cent. (b) October, 1930- 1st to 9th, £6 10s. per cent.; 10th to 31st, £9 per cent, (c) January, 1931 - 1st to 5th, £9 per cent.; 6th to 12th, £15 10s. per cent.; 13th to I6th, £18 7s. 6d. per cent.; 17th to 28th, £25 10s. per cent.; 29th to 31st, £30 10s. per cent, (d) June, 1931 - £30 10s. per cent.

page 2601

QUESTION

CRIMES ACT

Mr JAMES:
HUNTER, NEW SOUTH WALES

asked the Attorney-

General, upon notice -

Whether, in view of the fact that many offences under the Crimes Act have been committed by owners of industries, and this Governmenthas taken no action, does he propose to repeal the act with the object of safeguarding the workers against its use by some future government?

Mr BRENNAN:
ALP

– It is not the practice to state the Government’s intentions as to proposed legislation in reply to questions.

page 2601

QUESTION

PUBLIC SERVICE

Cost of Living Allowance

Mr CUNNINGHAM:
GWYDIR, NEW SOUTH WALES

asked the Minister for Home Affairs, upon notice -

Is it a fact that the salaries of public servants in Canberra have been reduced by amounts varying from £6 to £18 per annum, in accordance with an award of the Public Service Arbitrator?
Is it a fact that this award was based on a reduction in the cost of living?
Will the Minister give consideration to the question of reducing the tariffs to such public servants residing in Government-owned hotels and boarding houses in Canberra, so that they may benefit in this cost of living expenditure to the extent that the salaries have been reduced by the Arbitrator for this reason?

Mr BLAKELEY:
DARLING, NEW SOUTH WALES

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

Reductions of from £9 per annum to £18 per annum were made generally in salaries as a result of awards of the Commonwealth Public Service Arbitrator and a recent amendment of the Public Service Regulations, and, with certain exceptions, applied throughout the Commonwealth Public Service.
The reductions were made in consequence of a variation in the cost of living throughout the Commonwealth.
The matter will receive consideration.

page 2601

QUESTION

DUTY AND EXCISE ON SPIRITS

Mr FORDE:
Minister for Trade and Customs · CAPRICORNIA, QUEENSLAND · ALP

– On the 20th May the honorable member for Wakefield (Mr. Hawker) asked the following questions, upon notice : -

What quantities of both imported and Australian spirits were cleared from bond during the three months ended 31st March, 1931?
What was the amount of duty received during the same period on both imported and Australian spirits, irrespective of the additional 5s. per gallon for bottling out of bond?
What was the amount of duty received upon both imported and Australian spirits in respect of the 5s. per gallon impost for bottling out of frond during the same period?
What additional expense is incurred by the Customs and Excise Branch of his department in the supervision of bottling of spirits in bond?

I am now able to supply the honorable member with the following information, which covers only those classes of spirits on which additional duty is charged when chey are not bottled in bond : -

The following figures show the amount of duty based on the above-mentioned clearances, which would have been collected if no additional duty of 5s. per gallon had been paid: -

It is estimated from the clearances of spirits imported and cleared in (a) bottle and (6) bulk, that the revenue derived from Lite additional 5s. rate for bottling out of bond would be -
No additional expense is incurred in the supervision of the bottling of spirits in bond. The licence fees paid by the bond proprietors cover the cost of the services of the departmental officers employed.

page 2602

QUESTION

CUSTOMS DEPARTMENT

Excess Officers

Mr SCULLIN:
Minister for External Affairs · through Mr. BrenNAN · ALP

– On the 20th May the honorable member for Boothby (Mr. Price) asked the following questions, upon notice : -

How many officers in the Trade and Customs Department in New South Wales, Victoria, and Queensland, have been compulsorily retired as excess officers?
How many have been compulsorily retired in South Australia as excess officers?
Among the officers so retired, how many of them were transferred from the State service with existing and accruing rights provided hy section S4 of the Constitution Act?
As the impression is abroad in South Australia that the compulsory retirement of officers from the Commonwealth Service is not free from the suspicion that victimization is the prime factor that has brought about the termination of their services, will the Minister carefully look into the matter and lay the papers connected therewith on the tabic of the House, in order that honorable members may see whether there is any justification for the belief that this further federal disability to South Australian officers is part of a scheme to deprive them of rights which were regarded, as having been established in the High Court, judgments, Leleu v. Commonwealth, and Lucy v. Commonwealth ?

I am now in a position to furnish the following reply : -

One.
Two.
Three.
I am advised by the Public Service Board that there is no foundation for the impression stated. The positions of the officers in question, who were 03, 00 and 08 years of age, respectively, were definitely in excess of requirements. No persons have been appointed in their stead and the positions have been abolished. The Civil Service Act of South Australia of 1S74, upon which any claim in this connexion as to existing and accruing rights must be based, specifically prescribes that the number of officers in any department may be diminished as circumstances require. I have obtained the papers in connexion with the South Australian cases under notice and am placing them on the table of the Library for the information of honorable members.

page 2602

PAPERS

The following papers were presented : -

Arbitration (Public Service) Act - Determinations by the Arbitrator. &c. - 1 931 -

No. 7 - Commonwealth Public Service Clerical Association.

No. 8 - Australian Postal Electricians Union and Federated Public Service Assistants Association of Australia.

No. 9 - Commonwealth Public Service Clerical Association.

No. 10 - Amalgamated Postal Workers Union of Australia; Australian Postal Electricians Union; Australian Third Division Telegraphists and Postal Clerks Union; Commonwealth Medical Officers Association; Commonwealth Postmasters Association; Commonwealth Public Service Clerical Association; Federated Public Service Assistants ‘Association of Australia; Fourth Division Officers Association of the Trade and Customs Department; Fourth Division Postmasters, Postal Clerks and Telegraphists Union ; Professional Officers Association, Commonwealth Public Service.

No. 1 1 - Amalgamated Postal Workers Union of Australia; Australian Postal Electricians Union; Australian Workers Union; Commonwealth Legal Professional Officers Association; Commonwealth Public Service Artisans Association; Commonwealth Public Service Clerical Association; Commonwealth Temporary Clerks Association; Federated Public Service Assistants Association of Australia: Fourth Division Officers Association of the Trade and Customs Department: Line Inspectors Association, Com- monwcalth of Australia; Meat Inspectors Association, Commonwealth Public Service; Professional Officers Association, Commonwealth Public Service.

Defence Act - Regulations amended - Statutory Rules 1931, No. 00.

Navigation Act - Regulations amended - Statutory Rules 1931, No. 57.

page 2603

TARIFF

Customs Duties

In Committee of Ways and Means:

Consideration resumed from the 5th June (vide page 2585), on motion by Mr. Forde -

That the schedule to the customs tariff be amended.

Division VI. - Metals and Machinery.

Item 136-

By omitting the whole of sub-item (a) and inserting in its stead the following subitem : - “ (a) Pig iron, per ton, British, 25s.; intermediate, 35s.; general, 45s.”

Mr FORDE:
Minister for Trade and Customs · Capri cornia · ALP

– Before discussing the individual items in this division, I shall make a general application to the goods dutiable under it. In the first place, an alteration of the duties on the basic raw materials - iron and steel products - involves the amendment of the duties on almost all of the finished products of which iron and steel form the raw materials. This statement needs qualification only where the finished product is not subject to protective duties. In considering the increased duties on such finished products as galvanized iron, iron and steel pipes and tubes, iron and steel channels, joists, girders, &c, rails, machinery of various kinds including motive power, electrical apparatus and appliances, bolts, nuts and rivets, and manufactures of metal of various kinds, the fact that increased duties have been imposed on the basic raw materials must not be overlooked. The duties imposed on most of the iron and steel products which form the raw materials of the engineering and allied industries are specific duties. Honorable members will no doubt be anxious to ascertain the ad valorem equivalent of these rates, and it will occasion some little surprise when it is known that the ad valorem equivalent of the existing duties under items 136 a, b, cl, 154 a, b,c, and 155 a, on a weighted average basis assessed on the importations from the United Kingdom, approximates only 27½ per cent. This rate cannot be considered very high when compared with that imposed under the tariffs of other iron and steel producing countries which have adopted the policy of protection.

– We adopt a somewhat similar policy in respect of many of our primary products, including butter, dried fruits, and sugar. The difference between the domestic and export prices for iron and steel base products ranges from £2 lis. to £3 ls. 6d. per metric ton, or on a percentage basis the domestic price is approximately 100 per cent, higher than the export price. Where an importing country does not possess an iron and steel industry, the “Kartel” allocates the market to its members, arid these charge a price according to the importing country’s capacity to pay. The possession of an iron and steel industry by a country, and the protection accorded such industry, constitute an assurance against exploitation by overseas combines. It has often been stated that if Australia did not possess an iron and steel industry it could import all its requirements of raw materials at the low prices quoted by the continental “Kartels”. Those who believe this are unduly optimistic, and need to be educated in respect of the methods of the overseas combines after they have entrenched themselves in a given market. Practically all the major iron and steel producing countries have found it necessary to adopt a protectionist policy. The action of Germany, France, and America in imposing duties which are definitely prohibitive, clearly indicates that these countries regard their home market as being absolutely essential to the development and maintenance of this key industry. In contrast with the protectionist policy adopted by these countries, the case of the United Kingdom may be instanced. The production of iron and steel in that, country during the last 50 years shows very little advance when compared with the increased production of iron and steel in France, Germany and America. Indeed, the policy of freetrade in the United Kingdom has had the effect of dividing this key industry into two clearly defined sections, namely, that which manufactures the finished article from iron and steel produced in the United Kingdom, and that which fabricates its products from iron and steel imported from the Continent. This latter section of the industry performs the finishing off process only. From the view-point of a nation’s welfare, the development of the fabricating section, which imports its raw material from foreign countries, cannot be regarded with equanimity. If such a development can take place in a country so favorably endowed with the necessary raw materials, - that is iron ore and coal, it proves that Australia cannot hope to become possessed of an important national iron and steel industry without adopting a wholehearted policy of protection.

Under a freetrade policy the iron and steel industry of the United Kingdom has suffered a marked decline. Imports of iron and steel products totalled 2,230,955 tons in 1913 and 2,908,347 tons in 1930.

Exports totalled 4,969,225 tons in 1913, and 3,157,925 tons in 1930. In presenting the report of the Civil Research Committee to the House of Commons in December, 1925, the then British Prime Minister stated apropos of the iron and steel industry -

The evidence revealed a serious situation; the pressure of foreign competition aided by long hours, low wages and depreciated currencies is being severely felt by our manufacturers and had His Majesty’s Government been able to deal with the iron and steel industry in isolation we might have regarded the case for inquiry as complete.

In February, 1931, the National Federation of Iron and Steel Manufacturers of Great Britain, alarmed at the low production figures for December, 1930, and at the increase in the excess of imports over exports, protested to the Government, and urged the necessity of the regulation of imports. The Federation stated that the control of imports was especially justified owing to the fact that imports were not only below the selling price in the country of origin, but actually below the cost of production. The authority for that statement is a report issued by the League of Nations on the metallurgical industry. These are the difficulties experienced by the manufacturers in the United Kingdom. When it is considered that Australian wages in this industry are 100 per cent, higher than those paid in the United Kingdom, it is obvious that there is need for adequate protection against the manufacturers of that country.

Mr Stewart:

– Why are our wages 100 per cent, higher?

Mr FORDE:

– The honorable gentleman knows that, for many years the Australian people have en-joyed a higher standard of living and better working conditions than the people of Great Britain in practically every industry.

Mr Hawker:

– What about those who are out of work?

Mr FORDE:

– Until the last couple of years we obtained peak prices for our wool and wheat, and those engaged in the pastoral and agricultural industries enjoyed substantial prosperity. There has been a decline in this prosperity in the last couple of years, due to the drop in world prices, with the result that those engaged in these industries - the people who have invested their money in them and also the people who depend upon them for employment - have had a very lean time.

Mr Paterson:

– This is questionable.

Mr FORDE:

– We all have our opinions upon the subject. Mine are based upon facts, whereas those of the honorable member are supported only by fanciful theories. The Government bases its case for this industry on the report and recommendation of the Tariff Board, which spent some eighteen months in exhaustively investigating the subject in all its phases. Complete details are furnished in that report, copies of which have been circulated among honorable members. In many cases the board recommended that duties higher than are now proposed should be imposed on iron and steel products. I emphasize the point that this is not merely a secondary but also a most important primary industry, as it mines all its raw materials and transports them to ‘the manufacturing centre at Newcastle, where they are treated. It gives employment to a great number of people, and would be of inestimable value to Australia were our iron and steel supplies cut off, for instance, by a war. I feel sure that these items will have a speedy passage at the hands of the committee.

Mr GREGORY:
Swan

.- I believe that everybody will admit that the iron and steel industry is of great national importance, and that the people of Australia should do everything within reason to build it up. But the question of moment is, who is to pay the bill? When considering the relative advantages of high or low duties, it is surely worth while to contemplate their effect upon the industries and the people of Australia. If it is believed that any industry ‘ needs assistance, it is surely necessary to consider whether that could not best be given by means of a bounty, which would ensure that every person in the community paid his fair proportion towards establishing the industry.

Very properly, the Minister pointed out that this might well be termed a basic or key industry. It supplies the raw material for almost every other secondary industry in Australia. In the circumstances we must ask ourselves what will be the effect of increasing duties upon raw materials that are used by practically every manufacturer in the Commonwealth. The Minister gave the committee some particulars with regard to the percentage increase in the prices of these commodities in Australia as compared with those obtaining in Great Britain. According to the Economist, the price for pig iron in the Homeland is 58s.. a ton. The Government is imposing a duty of 25s. a ton on that commodity, which is considerably more than the 22 per cent, to 25 per cent, increase referred to by the Minister. The honorable gentleman drew attention to the good wages and conditions prevailing in the industry. It is necessary, however, to consider the effect of the duties on the people of Australia as a whole. According to the report of the Tariff Board, employees in the iron and steel industry are being paid £6 lis. a week. Yet we have hundreds of thousands of unemployed. Good conditions are given to a privileged few at the expense of the rest of the community. The only justification for giving tariff assistance to an industry such as this is that it creates wealth for the community. If duties result in excessive prices, and lessen the market for iron and steel products, our object is defeated, and the tariff simply causes additional unemployment.

The Minister talked about the reductions that have taken place in the price of iron and steel products since 1920. Nothing more stupid could have been said to a committee of intelligent men. It is common knowledge that from 1919 to 1922, prices generally soared to almost unbelievable heights all over the world. Since then they have fallen as spectacularly except for factory goods in Australia. How can we hope to establish artificially high prices for iron and steel products in Australia when very much lower prices rule elsewhere? How are our producers to export their products in such circumstances? For the information of the committee I shall quote a list of comparative prices of iron and steel commodities, in 1913 and 1931-

Even in Europe prices are now below what they were before the war. Our primary products must compete in the world’s markets notwithstanding that the costs of production are kept at high level by the favoured treatment meted out to selected secondary industries which are making huge profits. I would be prepared to assist in building up an industry of this kind if assistance were required, but I do not believe that it is. At any rate, no industry can carry on in an economically sound manner if it is subject to all sorts of socialistic interference, such as the fixing of wages and conditions for every process entailed in the manufacture of pig iron and steel. For all this the public has to pay the bill. The Minister spoke only of the Broken Hill company which is operating at Newcastle, but there are others. For instance, there is the big firm of Hoskins Limited, at Port Kembla. The Minister said that if these duties were not imposed the importers would combine to rob the community. Far from that being the case, we have definite proof that the local manufacturers are acting in restraint of trade and are forcing up prices. I have repeatedly urged the Minister to inquire into allegations that the Broken Hill company has refused to supply traders outside the trade ring. I have here a letter from one man stating that he was compelled to join the Iron and Steel Association, and the Oil Association, and that he is now making 15 per cent, more profit than before. Under the protectionist system we have trade combinations in a form as rotten as they can be. The Tariff Board ignores these things. If Australian manufacturers are to receive the assistance of the tariff they should be compelled to supply all retailers who are able to pay cash. The Broken Hill Proprietary needs no tariff assistance. But since great tariff privileges were granted to that firm in 1920 we have almost annual demands for more and still more protection. In 1927 I prepared a publication in answer to that issued by the company under the name of From Silver to Steel. . I pointed out that the company had begun with a capital of £1,109,888, and after making distributions to shareholders out of profits, the capital was £2,687,788, including £1,500,000 taken from reserves; leaving still in reserve an amount of £3,505,225. The paragraph from which I quote continues -

Reviewing their assets, the steelworks, from which enormous sums have been written off, and of which even that protectionist journal, the Bulletin, states, “ that it casts a dubious eye on the heavy sums spent on plant and improvements and charged to working account” thus hinting at hiding abnormal profits, are valued at £5,723,558, mining equipment and &c, £224,744, stocks, £608,577, bookdebts and investments, £1,816,458, a total of £8,373,337; while their total liabilities, excluding capital and reserves, are said to amount to £2,289,800, leaving a credit balance of over six- millions, a truly marvellous result for a little over ten years active operations.

I am glad that the company has done well, but I should be better pleased if it had done so without exploiting the community. Giving evidence before a select committee, appointed by the New South Wales Parliament, in 1915, Mr. Delprat stated that his company desired no assistance in any shape or f onn from the Government ; it required no duty, no bounty, and no help; that if it could not compete with the world it would not start operations. I strongly recommend the honorable member for Maribyrnong (Mr. Penton) to study the evidence given before that committee. About four years ago the General Manager of the Broken Hill company stated, after returning from a visit to the United States of America, that the Broken Hill works were as up-to-date, and the workmen as efficient, as those of the largest concerns in America. In the publication issued by the Broken Hill company, reference was made to the marvellous deposits of iron ore at the disposal of the company, and the General Manager giving evidence before the select committee, stated that the company could assemble at Newcastle iron ore, coke and lime stone, for the production of pig iron at a lower cost per unit than could the United States of America Steel Corporation. In the book, From Silver to Steel, the amount of ore necessary to produce 1 ton of pig iron in the various iron-producing countries of the world is given as follows: -

The company boasted in a prospectus which asked for the public’s support for the debentures it was issuing, that 2 tons of ore were required to produce in Great Britain as much iron as could be produced from 1 ton of ore in Australia. When we realize that iron and steel are the raw materials of so many other industries, the high price at which they are selling here becomes a very serious matter. A recent applicant for tariff assistance stated before the’ Tariff Board that raw material for the manufacture of scoops would cost him 100 per cent, more in Australia than the price for which his competitors could buy similar material in Great Britain. The Broken Hill Proprietary Company has every natural advantage; its works are situated close to coal-mines, and deep-sea vessels can unload ore right at the works. Nevertheless, the company asks for and receives these enormous protective duties. There is at present sitting in Melbourne a conference which proposes to demand sacrifices of all sections of the community except the manufacturers. Old-age pensioners, soldiers, and those who have lent money to the Government are to make sacrifices, but the manufacturers are to be allowed to continue selling their products at exorbitant rates. We have built a sort of fiscal wall of China around Australia to protect the local manufacturers from every form of outside competition. We seem to forget that we are dependent for our national income upon what we receive for the products we export. Just now I am reminded of some of the old mining towns of Western Australia. When the mines closed down, many of the people stayed on and lived on each other - by taking in each other’s washing, presumably. The inhabitants of our cities are fast reaching that condition, and they will have to pay the penalty; but in.the meantime they are destroying those great primary industries that gave them their past prosperity. The income of the primary producers has fallen away, in many cases practically to nothing, and the dwellers in the cities are only now finding how much they are dependent on those in the country. On the 22nd April, 1915, the Chairman of the Tariff Board, speaking of the iron and steel industry, stated -

I see nothing in the evidence to justify the assumption that some form of fiscal assistance will be permanently inevitable. On the contrary, the richness of Australian ore deposits compared to those of other countries - the Iron Knob ore yields 08 per cent, of iron as against 30 per cent, profitably worked in Germany -

Germany is producing iron and steel at lower rates than in 1913, when the Australian prices were from 60 per cent, to 70 per cent, lower than they are to-day. The statement continues -

And the freight charges borne by our nearest competitors make it probable that Mr. Delprat’s original view that the industry can stand on its own footing in Australia will prove right, once output is secured, and, with it, low production costs.

The exchange on heavy imports such as Cleveland pig iron, which is sold at 58s. per ton, amounts to about £1 per ton, and the freight up to 60s. per ton. Some smelters have no occasion to import pig iron, but special classes of iron and steel have to be obtained abroad, and the proposed extra duties necessarily build up the costs of production in Australia.

I gave figures, some time ago, showing that a large mining plant, that would cost about £520,000 in Australia, could be built for £350,000 in the “United States of America, and the provision for amortization of the liability would be much less in the United States of America than, in Australia. A mining proposition that would show a profit in the former country could only be worked here at a loss. If we insist on imposing increased duties on every item of machinery, every scrap of rolling-stock, all the rails needed for the State and Commonwealth railways, and every tool that the artisan requires, we must, inevitably, seriously increase the costs of production. Surely it is time to think of crying a halt, for we have gone too far. I move -

That the item be amended by adding after sub-item (a) the following: - “And on and after the 11th June, 1931 -

Pig iron - per ton, British, 20s.; intermediate, 30s.; general, 40s.”

– I believe in Australians buying Australian-made goods. At present only 25 per cent, of our total productive capacity in the iron and steel industry is being utilized. “While 75 per cent, of our plant lies practically idle, huge shipments of imports continue to come into this country. In those circumstances, I submit that the Government is fully justified in prohibiting the importation of goods which can be satisfactorily manufactured in Australia.

Mr Archdale Parkhill:

– “What does the honorable member mean by satisfactorily manufactured?

Mr LONG:

– The honorable member for Warringah (Mr. Parkhill) cares nothing about the conditions of the workers in industry so long as goods are produced cheaply. I stand for Australian artisans being given (the right to work and to enjoy a decent standard of living. The Broken Hill Proprietary Company Limited, which is only one of many companies which are prepared to produce the articles covered by this item, uses 8,000 tons of pig iron a week in its Newcastle plant. The works also use 2,400 tons of scrap steel, 1,200 tons of limestone, 250 tons of magnesite, and 250 tons of dolomite. If the works were operating continually at full blast they would consume annually 800,000 tons of ironstone, 500,000 tons of coke, 193,000 tons of limestone, 26,000 tons of silica rock, and 3,000 tons of phosphate rock. When we take into consideration the large number of men who could be employed in the production of iron and steel if Australian manufacturers were supplying the whole of the Australian market, it is quite evident that the Government is justified in seeking t-.j impose these duties. I support the Government, and intend to vote against the amendment.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

.- I think that every honorable member will admit that the iron and steel industry must be regarded as one of the key industries of Australia, and, in spite of what the honorable member for Lang (Mr. Long) said about persons with an un-Australian outlook, it is generally recognized that this industry is entitled to a certain amount of support. In giving this support, however, we must consider how other industries are likely to be affected. We must take into consideration what effect this extraordinary amount of protection will have on. the great mass of the people who are the consumers of this industry’s products. We should inquire into the industry in all its ramifications, paying due attention to its raw materials: iron ore, coal, limestone, &c, and the conditions under which they are produced. It will be found that the production of those materials is affected detrimentally by existing labour conditions. Coal is essential to the iron and steel industry, and every one knows what is taking place with regard to coal. Labour conditions have become such thai the production of coal is no longer an economic proposition. The same applies to iron ore. There is not a better deposit of ore in the world than that at Iron Knob, in South Australia. The trade unions, however, completely control conditions there. Despite the statement of the honorable member for Newcastle (Mr. Watson), it is a fact that primary producers are very large consumers of the products of the iron and steel industry. They now find, however, that the price of all the commodities they need has ‘ been raised against them. This applies to galvanized iron, wire netting, fencing wire, and barbed wire. So dear have these commodities become that farmers are not able to buy all they need..

Even the iron used for shoeing horses has become so much more expensive that the price of shoeing a farm horse has risen from 5s., at which it stood a few years ago, to 10s. Galvanized iron is dearer than it was. Those on the land who are engaged in developing Australia need large quantities of galvanized iron. In the first place, they need it to erect their dwellings; then, most likely their sheds, and even their fowl houses, are constructed of this material. I recognize that it is of little use debating this subject, but I could not allow the item to pass without entering a protest on behalf of those primary producers who are so greatly in heed of this commodity. Evidently prices are to be kept at the 1920 level, with no regard to the general economic situation. If that is so, what is to become of the equality of sacrifice, concerning which a great deal has been said at the Conference of Ministers, which is now being held at Melbourne? Evidently certain favoured sections of the community are to be protected at the expense of the consumers who are expected to make the sacrifices. I protest against the Government’s proposal, and support the amendment of the honorable member for Swan (Mr. Gregory).

Mr BELL:
Darwin

I shall conclude as I began, by recognizing to the full the futility of debating, this or any other item in the schedule. With monotonous regularity, irrespectiveof the trend of the debate or the facts adduced, each item goes through.

Mr Lewis:

– That is not so. The duties on cotton wool were withdrawn.

Mr STEWART:

– I think that the item was postponed.

Mr Jones:

– If the Russian Government endeavoured to dump Soviet wheat in this country, would not the honorable member, as a good Australian, be one of the first to suggest the imposition of protective duties?

Mr STEWART:

– If the wheatgrowers of Australia were given the right to sell their goods in the markets of the world and purchase other goods in return, untrammelled by exorbitant duties, they would not fear any dumping on the part of Soviet Russia. I shall not delay the committee longer. I again remind the advocates of extreme protection that it is impossible to apply to all of the workers in all of the industries of Australia, the standard of living upon which they insist for the workers in our secondary industries. If that were attempted, the system would collapse. It is ridiculous, while we borrow overseas money in the form of goods from the workmen of other countries, to sneer at the standard of living of those workers. For us to do that is to behave like a man who was running a Rolls-Royce motor car on money borrowed from the owner of a Ford, and sneering at him because he used the less expensive vehicle.

Mr MARTENS:
Herbert

– My principal argument will be on behalf of the Australian worker, who has, by organizing, attained the position that he enjoys to-day. I suggest that the persons represented by the honorable member for Wimmera (Mr. Stewart) might follow the example of the industrial workers of Australia and do something to organize themselves.

Mr Stewart:

– I agree with that.

Mr MARTENS:

– The honorable member was a supporter, and for some time a Minister, of a government that did not concern itself very much about how much or what Australia imported, with the result that a very formidable adverse balance of trade has been built up against this country. The least that that Government could have done was to balance its ledger when times were prosperous. I submit that the wages paid to the industrialists of Australia did not in any way tend to bring about our adverse balance of trade, which is due wholly to the shortsightedness and extravagance of preceding governments.

We are continually told that the unfortunate position of the primary producers is due to the demands of organized labour. There is a factor, however, which many have conveniently overlooked. I have before me the Sydney Daily Telegraph, of even date, in which appears the following paragraph:-

600,000 LB. OF COFFEE DUMPED IN SEA.

Rio Janiero, Tuesday

The National Coffee Council has dumped 600,000 lb. of coffee into the sea for the purpose of assisting the market. Several more shiploads will be destroyed in order to rid the country of its huge surplus.

When in Sydney I usually reside at Manly, and I remember that,on one occasion, when travelling across to that suburb by ferry, I saw great quantities of apples being washed up on the sand near the jetty. They had been jettisoned for a purpose similar to that described in the paragraph that I have just read - to keep up prices to the detriment of the consumers. I cannot remember any protest being made by honorable members opposite or the people that they represent, against the destruction by the market brigands of large quantities of valuable food. The wages that are paid to the workers in the iron and steel, as well as in all other secondary industries, have been awarded by the industrial tribunals of this country. I am a believer in the system of wage fixation. I do not know whether or not the workers in Great Britain are content with a poorer standard than that which obtains in Australia ; but I assume that in a general sense their conditions are not inferior, because the cost of commodities in that country is less than it is in this. [Quorum formed.]

– Production must be increased by 50 per cent, to enable us to pay our overseas interest bill.

Mr MARTENS:

– The time will come when we shall not be able to meet our obligations, even though we increase our production by 100 per cent. That reorganization is necessary is undeniable. I shall support these duties, despite the sneers and innuendoes of honorable members opposite. We fortify our actions with convincing arguments, but they advance no argument at all. When they sat on this side, and were able to take what action they liked, they operated a protectionist policy, or a revenue tariff policy, that enabled their Treasurer to swell his revenue by millions of pounds. The honorable member for Wimmera (Mr. Stewart) was thus afforded an opportunity to spend millions wastefully in the provision of a capital city for Australia.

Mr WHITE:
Balaclava

.- There is no doubt that the manufacture of iron and steel is one of Australia’s greatest industries. During the world war it was not properly established in Australia, and its absence was very severely felt. Now that it is established on a sound basis we should do everything that we can to prevent it from retrogressing. If it can he assisted by means . of the tariff, that assistance should be given to it.

I intend to deal on its merits with each of the items in the tariff schedule, and to determine whether the industry concerned is worth preserving, or whether the benefits that it is said to confer are merely the product of the Minister’s imagination. Undoubtedly this is a great industry ; but it is questionable whether the high costs that operate in it at the moment ought not to be inquired into. The Tariff Board held an inquiry into the industry in 1927, and made certain recommendations.I quote the following paragraph from its report : -

The board considers that the method adopted by it finds supportin the fact that all the principal factors entering into cost of production are -

The efficiency of plant;

The efficiency of management;

The efficiency of the labour engaged in production.

Having regard to all these factors, in the board’s opinion, the industry in Australia, as presented by the Broken Hill Proprietary Limited, is equal, if not superior, to the industry in the United Kingdom. The board has specially selected the Broken Hill Proprietary Limited as a standard of comparison, because it has concentrated its investigation chiefly on that company, and because the company’s standard of efficiency is second to no other industry of any kind in Australia. So that any recommendation the board may make will have been based upon the most, and not the least, efficient representative of the industry in Australia.

Thatis very fine testimony to the value of a fine undertaking. But the duties recommended at that time by the Tariff Board were not applied by the Government; in fact, the report of the board was never discussed in Parliament. The duties at present operating go back only to November, 1929. These duties are, to a considerable extent, in accordance with the recommendations of the board, which made it clear that the request for increased duties should he acceded to in regard to a number of items, particularly those covered by sub-items a, b,c, andD of item 136. The following table gives the details of the duties recommended by the board and those at present operating: -

– Then the Minister should make his report and recommendations available to the members of the committee.

In its last report the Tariff Board made a number of comparisons between the wages paid in this industry in Australia and in continental countries. This industry is in its infancy in Australia, and it should be protected. I think it was Gladstone who said that to speak of making steel in America was as ridiculous as it would be to talk of growing pineapples in England. He went on to say that pineapples could be grown in England, but only in hothouses. America replied to that statement by producing steel almost as good as British steel, and to-day holds a big proportion of the world’s -export market; but the industry had to be given adequate protection. In. dealing with the wages payable in this industry overseas, The Tariff Board reported -

In Germany the current average wage ia 32s. 6d. for a week varying from 54 to CO “hours.

No one desires that such long hours -should be worked in the industry in Australia. We have a different living standard in this country, but, as the honorable member for Wimmera (Mr. Stewart) pointed out, our standard does not apply to everybody, and so long as we have to borrow money from countries with a lower standard of living than our own, we should not despise them. The board dealt with the wages payable in certain other countries in the following terms : -

In Belgium the wage is 23s. Od. for a nominal week of 48 hours, in which considerable laxity as to working hours is allowed. In France the wage is 34s. Cd. for a nominal week of 48 hours, where again considerable laxity prevails. In the United Kingdom the wage is 61s. for a week of 48 hours, which is strictly enforced. In the Commonwealth of Australia the wage is 108s. 0d. per week for a week which was a rigid 48 hours, but which now may be permanently reduced to 44 hours.

In these circumstances, I ask the Government to give earnest consideration to the position of this industry in Australia. It must be realized that economically it is not on a sound basis. It should not be necessary for us to impose heavy duties in order to enable an industry to pay wages which otherwise could not be considered. There must be some co-relation between the wages in one industry and those in other industries ; and there must also be a greater degree of co-operation between employers and employees. On this point, the Tariff Board issued the following warning: -

From considerations such as the foregoing the Tariff Board is strongly of opinion that the industrial unions of the Commonwealth should be induced to realize the critical position into which the Commonwealth is drifting, and the absolute necessity for preventing the wages gap from becoming still wider between the United Kingdom, the continent of Europe, and the Commonwealth, otherwise the Tariff Board, placed as it i3 in the position to take a comprehensive and intimate view of all Australian industry, can see nothing but economic disaster ahead, and that at no very distant date.

Those weighty words of the board were prophetic. The economic disaster which was then forecast is almost upon us. We are very near the crash.

I shall vote for the ratification of these duties, because they have already been in operation for about eighteen months, and I do not think it would be fair to the industry or the men engaged in it, to withdraw the protection at this stage.

But in view of the reduced costs in certain directions, the whole position should be reviewed.

Sub-itemc of item 136, “Bar, rod, angle, tee, &c.” has a bearing upon the galvanized corrugated iron industry, because the Broken Hill Proprietary Limited supplies Lysaghts with the bars for rolling into sheets and is largely dependent on their business in this line; but I shall have something to say on that subject when that sub-item is under consideration. I am not pleased with the position in the galvanized iron industry. If Lysaghts are unable to carryon without heavier duties, they should close down the manufacturing side of their industry and become importers again.

I ask the Minister to give earnest consideration to my request for another inquiry into this industry with a view to having the duties brought into line with existing conditions. There has been a fall in values in many directions which should result in a fall in the cost of producing iron and steel.

Sitting suspended from 6.15 to 8 p.m. [Quorum formed.]

Mr CUSACK:
Monaro · Eden

.- It has been mentioned that the iron and steel industry of Australia was established in New South “Wales under freetrade and did not require protective duties to enable it to flourish. I have followed the progress of this industry fairly closely. Ever since my boyhood I have had a good deal to do with the importing and indenting of iron and steel. I remember that Mr. Sandford was the first to endeavour to establish the industry in Australia; but he was unable to do so owing to the lack of the necessary legislative assistance in the form of tariff protection. It is hardly necessary for me to discuss the merits of the iron and steel industry, because the honorable member for Newcastle (Mr. Watkins) has dealt with it fairly comprehensively. But I realize how easily honorable members may he misled owing to the way in which indentors and importers camouflage their profits. On one occasion, I indented goods of the same class and quantity through two different firms, and when they reached me I was surprised to notice the disparity of the charges. One of the firms was new to the business and, probably, did not know enough about it to attempt to fool its customers; but the other firm charged me 10 per cent, or 15 per cent, more than its competitor. On another occasion, when a duty on iron was contemplated, although it was not actually imposed, many firms had imported heavily in order to anticipate the duty, and although the customers of those firms were led to believe that they were getting iron on the basis of about 6 per cent, above the landed cost, it was found that, since the duty had not been imposed, iron could be purchased at about 25 per cent, less than the old rates. That showed that those firms were trying to unload their stocks, and that they had been making very large profits. I well remember the prices that were charged in those days for iron and steel. Although these commodities were manufactured cheaply in other countries, the benefit of the low prices abroad was never passed on to the Australian people.

A good deal has been said about the costs of production, and the wages paid in Great Britain. Those wages do not affect Australia much, because most of our imports of iron and steel are from the United States of America. To-day one can buy steel more cheaply from that country than at the time when we imposed no duty on it, and springs, and articles of that kind, are cheaper now than they were when they were admitted duty free. Honorable members who have been trying to deceive the farmers by making them believe that freetrade would be in their best interests, know that butter can be bought cheaply overseas; but they do not suggest that Australians should buy imported butter instead of the local product. While those members always favour protective duties for primary industries, they begrudge protection to the secondary industries. When the sons of farmers grow to manhood, many of them go to the cities because the policy of protection has fostered manufacturing industries, and employment is obtainable in such industries there. Often these men are more successful in their employment than they would be if they had remained in the country. I realize, of course, that much depends on the success of our great primary industries ; but they have their limitations, and we must not overlook the value of a policy that provides a home market for our producers, as well as employment in the cities. I believe that some honorable members opposite would not pay for a shave in Australia if they could obtain one overseas. They do not like to see several thousand persons employed in the tonsorial industry in Sydney. Apparently, they do not want Australians to obtain employment at all.

I think that Messrs. Hoskins and Company are getting rather more advantages under the tariff than they are entitled to. They do not pass on those benefits to the extent that I think they should; but I would prefer to have an exploiter and a monopolist operating in Australia rather than in New York or Chicago. In Australia he would probably invest his profits in war bonds, and the country would get something out of him by that means. Then, when he died, the Government would take 50 per cent, of his whole estate in probate duties. But the country would derive no benefit from the death of a monopolist in the United States of America. Australia is a remarkable country in many respects. At Burbong not far from Canberra, some of the richest iron ore in Australia is to be found. The deposit is too far removed from a coal field to make it payable to work the ore, but coal may eventually be found within reasonable distance of it.

The iron and steel industry deserves every encouragement. There could be no better preparation for the defence of this country than the development of the great iron and steel industry, so that Australia may eventually be in a position to build ships and armament. It is better to spend money in achieving that result than in maintaining schools for cadets, and the other appurtenances of the orthodox system of defence. It is unnecessary for members on this side to elaborate the advantages of the iron and steel duties. If any perspicacity had been displayed by honorable members opposite, they might have voted immediately on the item before the committee. I realize that nothing that I may say will dispel their obtuseness on fiscal matters. They desire to fool the farmers for a little longer. One honorable member opposite spoke about horse-shoes, and said that it costs more to shoe a horse to-day than formerly. That is because so few horses are used nowadays that farriers are unable to make a decent living, and have found it necessary to increase their charges. A farmer may now purchase horse-shoes practically ready to be placed upon his horse’s hoofs. Cheap and wellmade horse-shoes may be easily obtained to-day, owing to the development of the iron and steel industry in this country. For the last 40 years I have been in business having to do with horse-shoes and nails. It is vitally important to foster this industry, and any honorable member who declines «to support the item before the committee is recreant to his duty to his country.

Mr PROWSE:
Forrest

.- Iron and steel manufacture should be one of the leading industries of Australia, for we have natural facilities for its successful development. We have the raw material in plenty, and unlimited coal deposits, while we have the facilities of sea-borne freight. But the high protective policy of Australia has almost killed the industry, and has prevented it from being of great financial value. Had we concentrated on a few secondary industries that are natural to Australia, there would have been infinitely less unemployment than there is to-day. We might have made a great success of our iron and steel and implement-manufacturing works if we had given them our main attention, and had not attempted to manufacture numerous comparatively unimportant articles that might well have been imported from other countries in the ordinary course of international trade. Mr. Delprat meant what he said when, at the inauguration of the Newcastle steel works, he declared that the industry would not require protection. Why did he subsequently find that fiscal help was needed? Simply because Australia began all kinds of tiddly-winking industries, and because the Arbitration Court awarded high wages to the workers in those industries. This resulted in high duties, and increased the cost of living. Of course, the Broken Hill Proprietary Company had to pay these high wages, and that involved the granting of tariff protection against the iron and steel goods manufactured abroad.

The honorable member for Newcastle (Mr. “Watkins) said that he was chiefly concerned about the provision of work for Australians. I, too, desire that work shall be provided for the people, but I think that it should be done legitimately. The Minister for Trade and Customs (Mr. Forde) referred to the wages received in other countries, and admitted that the wages paid in the iron- and steel industry were 100 per cent, higher than those obtaining in similar avocations in other countries. Can we afford to protect the iron and Steel industry to’ this extent in order that it may pay to its employees wages 100 per cent, higher than are paid by its competitors in other countries? This high impost is a direct burden upon our export primary producers, who are unable to obtain any concession by way of tariff protection for their production. The Minister declared this afternoon that the Broken Hill Proprietary Company was in a better position when high prices were being realized for our wheat and wool, because then our farmers, who are large users of iron and steel products, were able to purchase more largely of the output of the company. He now offers” the excuse that because wool and wheat prices are down business with the Broken Hill Proprietary Company has declined to such an extent that additional protection is required. How is it possible for our primary producers, whose incomes have declined so seriously, to continue to purchase iron and steel products at present high costs? Do not honorable members opposite realize that our farmers are at their wits’ end to carry on, and do not they think it grossly unfair that additional protection should be given to this sheltered iron and steel industry? The right honorable the Prime Minister (Mr. Scullin), the Treasurer (Mr. Theodore), and the Leaders of the Opposition in this Parliament are now engaged in a most important conference in Melbourne the object of which is to devise means to reduce costs in Australia, and yet the Minister for Trade and Customs (Mr. Forde) is submitting to this Parliament proposals the effect of which will be to increase’ the cost of production on, all farms throughout Australia. The iron and steel industry ought to be a key industry, supplying the essential requirements of our primary producers at a reasonable cost. Instead of being in a position to do that, it has been spoonfed with tariff protection to such an extent that it has now become an incubus. Its products are at a prohibitive price. No one will seriously argue that Commonwealth or State railway authorities can afford to pay the high prices charged for rails for new construction. Even under existing conditions most of our railway systems are a heavy charge on the Consolidated Revenue. Some years ago the Commonwealth Government placed an order with Thompson Brothers, of Castlemaine, for the construction of a number of railway engines for use on the Port Augusta to Oodnadatta line at a price £60,000 in excess of overseas tenderers. The interest upon that transaction represents a definite charge, for all time, of about £3,000 per annum against the Oodnadatta railway, and since that section of the Commonwealth railway system is not showing a profit, this charge is borne directly by the taxpayers of Australia. I say, therefore, that this higher protection to the iron and steel industry will mean more unemployment throughout Australia. The honorable member for “Werriwa (Mr. Lazzarini) informed us some time ago that the purchasing power of the English pound was seven times greater in Japan than in the Mother Country. In Australia the purchasing power of the same pound is about one-half that of its buying power in England. Our objective should be to increase the purchasing power of wages. It is an anomaly that, with 300,000 or 400,000 unemployed in Australia, an attempt should be made to maintain a high standard of living for a limited number of employees in a sheltered industry. It would be better for all concerned if we came down to a reasonable economic level, so that all sections of the community could make an equal contribution to the salvation of the nation. The honorable member for Swan (Mr. Gregory) pointed out, earlier in the debate, that a few years ago we had an export trade in iron and steel products. We should still be exporting if we had not raised the industry to an uneconomic level. The Government is about to make a nation-wide appeal to bondholders and all sections of the community to help to extricate the nation from its present financial and economic difficulties. In the circumstances, it is anomalous that additional protection should be given to the iron and steel industry which so vitally affects all farming costs. Sacrifices must be made by all sections if we are to overcome the difficulties that confront us. The honorable member for Newcastle (Mr. Watkins) made an earnest appeal this afternoon on behalf of the Newcastle steel works, but there was not an ounce of common sense in all that he said. I listened to the honorable member very patiently. The iron and steel industry has proved of disservice to the people of Australia. In New Zealand, with a tariff of 15 per cent., the manufacturers of iron and steel are able to sell their products in Australia, and in other countries. No doubt they would like a greater measure of protection, but they have the good sense to realize that, if the tariff wall were raised unduly the industry would become uneconomic, so they are content with 15 per cent. The industry in Australia is amply protected by heavy freight charges, the present high rate of exchange, the lower cost of living, and the consequent reduction in’ wages costs. I, therefore, fail to see why additional protection should be given to it. These tariff burdens fall ultimately upon our farmers, who are already in a desperate plight. The only thing which this Government has done for them has been to place heavier burdens upon their shoulders by giving high protection to a number of sheltered secondary industries. The iron and steel industry is old enough to stand on its own feet. I, therefore, support the amendment moved by the honorable member for Swan.

Mr RIORDAN:
Kennedy

.- I endorse all that the honorable member for Newcastle said on behalf of the iron and steel industry. The honorable member for Forrest (Mr. Prowse), made several references to what he termed minor and- unimportant industries, the encouragement of which, he declared, was not in the best interests of Australia. Can the honorable member name one such industry?

Mr Prowse:

– Yes; the match industry.

Mr RIORDAN:

– That industry provides employment for a large number of male and female operatives. It is true that the unemployment problem in Australia is very acute, but the same conditions obtain in freetrade England as well as in other European countries. No industry is deserving of greater protection than the iron and steel industry. I should like to see it under government control. Because of the operation of the industrial plan in Russia, the iron and steel industry of practically every country will have still greater difficulties to face in the near future. Whatever may be said against the Soviet policy, we must admit that the originators of it had in view the interests, not of a certain section of the people, but of the nation itself. In Australia, despite a bountiful season, we are faced with a very difficult unemployment problem. We have had a record crop of wheat which we have been obliged to dispose of at unremunerative prices, and overseas prices for all our exportable products are at a low level.

We have all the means of production at our disposal, but unfortunately the financial cog in the machinery of production is not functioning satisfactorily. The producer is the man on the land,, the worker the man with the shovel and the plough. The tariff gives to the man on the land a home market, for his goods, and his principal trouble to-day is that the “purchasing power of many who would otherwise be consumers has disappeared. Production may be bountiful, but the essential complement of consumption is greatly diminished. Honorable members opposite say that the farmer is practically bankrupt. That is not due to the tariff, because the principle of protection isadmitted even by opponents of this, schedule. On this issue the only difference between the Government and theOpposition is as to the extent to which the protective policy should be carried. The Government believes that such dutiesshould be imposed as will give to industries -a chance to get on their feet. The iron and steel industry has been established for a comparatively short time. A great deal of capital is invested in it, and it requires a big market to enable it to pay overhead charges. The honorable member for Swan (Mr. Gregory) referred to the wages paid to the employees in the industry. The higher the wage the greater the purchasing power of the worker, and the better for the farmer. After all the farmer who is utilizing his laud to make a living for himself and his family employs very little labour, particularly since appliances for the saving of time and labour have come into general use. The wheat that is sold overseas gives a little employment to the wharf labourer. Some honorable members complain of difficulty in making ends meet with the allowance they receive; how much harder must be the lot of a man maintaining a wife and children on £3 7s. a week, or of a person receiving a dole of a few shillings a week! The further we decrease wages the deeper the country gets into difficulties. High duties are not the cause of unemployment, and the duties proposed by - the Government are not unduly high when compared with the following rates in other countries: - United States of America, £4 7s. 6d.; France, £4 6s. 9d. ; Italy, £9 13s. 6d.; Argentine, £7 12s.; Brazil, £7 15s.; India, £5; Canada, British 15 per cent, and foreign 25 per cent.; South Africa, British free, foreign 3 per cent. The Australian iron and steel industry is protected by duties of about 29 per cent., but it is, I suppose, of more recent origin than similar industries in the other countries I have mentioned. It requires time to get on its feet.

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– When will it get on its feet ? ,

Mr RIORDAN:

– Its development was retarded by the fact that, for sixteen years the Nationalists and kindred parties were in office in this Parliament. The fact must be remembered also that the iron and steel industry throughout the world is experiencing a depression. The honorable member for Forrest (Mr. Prowse) complained of the margins of 70 per cent, and 90 per cent, for skilled and i unskilled labour respectively. He says that the high wages paid in protected industries detrimentally affect the farmer; but if dairy labour were available for nothing cows would not give more milk. In a favorable season like the present they yield more milk, and the return to the farmer is better than in a droughty season when butter prices are high. The Australian worker is paying under the Paterson scheme and the Queensland pool a high price for butter in order to maintain certain standards in the dairying industry. The community is paying more for Queensland sugar than it would pay for the product of Java, but it is making that contribution towards the maintenance of the White Australia policy and high standards of living. It is the duty of this Parliament to increase employment whenever possible. The losses on the railway systems are due, not to the cost of locally-produced rails, or to the wages paid to our workers, but rather to over-capitalization and the long mileages through unproductive areas held by speculators who hope to reap the benefit of community-created values. Parliament should compel the land along the railways to return to the Government its full economic value. It is better to use rails produced in Newcastle than rails made in other countries. We are at least utilizing our own raw materials, and providing employment for our people. Why are so many people unemployed in this young country, having regard to the fact that a few years ago the Bruce-Page Government was promoting extensive schemes for development and the absorption of migrants from overseas? What has become of those schemes ?

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

– This Government has frightened capital out of the country.

Mr RIORDAN:

– The honorable member surely does not intend that remark to be taken seriously. When this Government came into office there was not even a cracker in the cupboard. What capital was left in the country had not enough feathers to fly away. The honorable member for Swan (Mr. Gregory) spoke of the export of coal. I remind him that that ‘trade has fallen off largely because many of the ships that now come to Australian shores have been converted into oil liners. The steel industry, however, provides a good local market for coal.

Mr GULLETT:
Henty

.- I was very disappointed with the Minister’s presentation of the case for these duties. There is no more important industry in Australia than the production of iron and steel, nor one that hears more heavily on other industries. The committee might reasonably have expected from the Minister a fuller explanation of this proposal, the effect of which is to increase the duties upon the raw materials of all iron and steel manufacturers. Briefly, the position is that if we make a mistake in connexion with this item by imposing a duty at all excessive we definitely place a restrictive tax upon every other industry and a penalty upon every home in Australia. As this raw material is cheap or costly so will all engineering products be cheap or costly. Therefore, while the protection of iron and steel within Australia is of first-class importance the country would be better off without the iron and steel industry if its cost were excessive.

Mr Watkins:

– Could- the country be better off without the iron and steel industry?

Mr GULLETT:

– In certain circumstances, yes; because an essential industry, which is at the very base of all manufacturing costs in a country, and is the foundation of every form of production in that country is desirable only if it can be established at a cost which the country can afford to pay.

The party to which I belong was responsible for the establishment of the iron and steel industry in Australia, and I think we are all exceedingly proud of the part we played in that regard. The industry cannot complain of any lack of consideration by this Parliament. Not only was it brought into being, and fostered, but in order to provide an outlet for its products this Parliament has also brought into being and fostered a great many subsidiary industries in iron and steel manufacture. The extraordinary bearing that these duties have upon other industries was indicated by the Minister when he said that if we accept these increases we must, as the schedule is further considered, expect to find a great many other increases in connexion with iron ‘ and steel products.The increases shown in this item are only the beginning of a great many increases affecting every kind of iron and steel manufacture in Australia; and as the item is of such special importance, we should have had from the Minister a far more complete case than that which he has thought fit to present to the committee. He said that the total duties, including the increases now being put on, amounted to an all-round ad valorem duty of 27-J per cent. I do not agree with his figures.

We have not had a word from the Minister about the financial position of these great iron and steel companies. If he had told us of the capital employed, and given us a sketch covering the finances of these companies over the years and their profits and losses; if he had told us something about their efficiency and the relation of past costs of wages’), coal, and exchange to present-day costs, those who are friends of this industry would have been in a position to give an intelligent vote upon this item. But in the absence of such information we cannot do so. I shall not vote for any item on an insufficient case. If the Minister will change his mind and give an investigation, not a prolonged one, but one that will enable honorable members to- be in possession of the facts about the present costs and the financial position of the companies, the position will be quite different. I find it most unpleasant nol to be able to support these increases, justifiable though they may be. My difficulty is that I do not know that they are justified. There is nothing before the committee to enable me to form a judgment. We all have the very deepest respect for such ‘ companies as the Broken Hill Proprietary and the Australian Iron and Steel Company because of their enterprise and courage and first-class efficiency. I do not believe that they would come to this House with requests that could not be justified, and

I am led to that conclusion in a sense by the very modesty of these increases compared with other increases put before the committee by the Minister. Nevertheless, in the absence of reasons justifying these increases, I am unable to support them.

To-day the Minister made reference to the 44-hour week which is in operation in New . South Wales. It is no part of our duty at any time to make a tariff to fit in with any fantastic wage and hour alterations brought about by any State politician. The 44-hour week which is now the law in New- South Wales, to the great misfortune of many manufacturers in that State, was the outcome of a very rampant electioneering promise; but the Federal Parliament, in its tariff-making, will not chase changes in working hours or in anything else. At least I do not propose to do so, and I trust that other honorable members will adopt the same policy. It would be quite impracticable for us to keep on altering our tariff to meet changes of that kind. I am in complete agreement with those honorable members who point to the impossibility of rural Australia, which is a heavy purchaser of iron and steel products, being expected to maintain metropolitan or manufacturing industries that are paying a wage in engineering works and factories at least twice as much as rural industries can afford. We shall never return to full production at reasonable cost - a cost at which our great primary industries can compete successfully overseas - until there is some relativity between rural wages and wages in secondary industries. I do not suggest that manufacturing wages should be brought down to the level of rural wage.s, but I do say that there should be a point at which those wages should relatively meet, and until that is established this country -will never prosper as it should. To me it is no argument to say that wages in this industry in Australia are lOSs. 6d. a week of 44 hours, that in the United Kingdom the wages are 61s. for a working week of 48 hours, that in Prance the wage is 34s. 6d. a week, and in Belgium, 33s. 6d, I do not wish this country to pay the wage that is paid to the workers in Belgium, but, on the other hand, I do not wish to see our rural workers unnecessarily crushed in order to bolster up a fancy wage for our urban workers. I say that, although I represent an urban constituency. I repeat the offer made to the Minister that if he will promise an immediate inquiry into the C03ts of this industry to-day, as compared with two or three years ago, I shall support the increased duties under this division. I ask, not for a full inquiry by the Tariff Board, but for full information of comparative costs which can easily be gained by the accountants in the Customs Department.

Mr LEWIS:
Corio

.- The honorable member for Henty (Mr. Gullett) is one of those honorable members who hungered for the Government to bring down this tariff schedule so that they might have an opportunity to discuss it, but strange to say the whole tenor of his speech was a plea for postponement and further delay. Apparently, procrastination is the only thing that will please the honorable member at this moment. The duties on most of the items in this division are as they existed previously. Only a few minor items are subject to increased duties. I find myself in accord with the Minister’s proposals. It has been pointed out by the honorable member for Newcastle (Mr. Watkins) that most of the duties which are now under discussion are considerably lower than those recommended by the Tariff Board in respect of the iron and steel industry. Both the honorable member for Wimmera (Mr. Stewart) and the honorable member for Forrest (Mr. Prowse) spoke in opposition to these duties. They apparently would have us believe that the plight of our primary producers is entirely due to the operation of the Labour party’s protectionist policy, but they failed to give a single instance of a country that is not confronted with a problem similar to that facing Australia to-day. Take for instance the United States of America, one of the wealthiest countries in the world. There the farmers are in a predicament similar to that of the primary producers here. As a matter of fact, an. examination of the statistics relating to agriculture in the United States of America shows that during the last ten years the farmers in that country have been leaving their holdings at the rate of 30,000 per annum, the total number of those who have abandoned their farms being over 300,000. A journal called The Parliaments of the Empire contains a report of a debate which took place in the Parliament of Northern Ireland, and it shows conclusively that that country is faced with a position exactly similar to that confronting Australia to-day. The honorable member for Wimmera has said that the farmers qf Australia would be prepared to face competition from Soviet Russia, or any other country, if only they were relieved of the tariff burden which, he says, is crushing them to-day. He knows full well that he can give that undertaking without any sense of responsibility because no country in the world that has adopted a protectionist policy. is likely to remove entirely its protectionist tariff. Therefore, there is no point or force in the statement of the honorable member that the primary producers of Australia would be prepared to face unfettered competition if tariff restrictions were removed from them. The debate that took place in the Parliament of North Ireland dealt with the importation of Russian oats.

The TEMPORARY CHAIRMAN (Mr Mackay:
LILLEY, QUEENSLAND

– I remind the honorable member that he has not yet touched upon the item of pig iron, which is now under discussion.

Mr LEWIS:

– The honorable member for Wimmera (Mr. Stewart) and the honorable member for Forrest (Mr. Prowse) used these arguments, and I am simply replying to them.

The TEMPORARY- CHAIRMAN.But those honorable gentlemen did make reference to the industries affected by these duties.

Mr LEWIS:

– That is quite true. The honorable member for Wimmera contended that if the primary producers were relieved of tariff restrictions, they would be prepared to face unfettered competition from overseas. It is extremely unlikely that this country would discard its protectionist tariff. We know from experience that the primary producers, when faced . with outside competition, immediately seek some measure of protection. I need only mention New Zealand butter, South African maize, and onions.

Mr Archdale Parkhill:

– All the preceding speakers on that side of the chamber have said that it is a matter of wages.

Mr LEWIS:

– That is not so. The report of the Inland Revenue Commissioners for Great Britain, shows that the number of persons in that country chargeable with income tax in 1929-30 was 50,000 in excess of the number for the previous year, and also that in the year mentioned, over 130,000 estates, of a capital value of £538,000,000, were liable for death duties. The estates of 15 millionaires, valued at £32,000,000, were liable to pay duty in that year. Those are record figures for the Old Country. The rent of lands and houses, which in 1920 amounted to £182,000,000, reached a total of £260,000,000 in 1929-30. In ten years the net capital value of the estates passing at death increased from £327,000,000 to £538,000,000. No fewer than 127 millionaires died in that tenyear period, 1920-30.

Notwithstanding the depression in Great Britain there are still industries’ in that country which are being carried on with profit. Indeed, in many instances the profits are greater than ever before. It is not because of any inefficiency on the part of Australian workers that there has been a decrease in the volume of production, nor would any increase in their efficiency lead to the employment of a greater number of workers. In a statement made in the British House of Commons, the Lord Privy Seal, dealing with the conditions in the coal-mining’ industry of Great Britain, said -

In ten years the output of coal in America has gone up by 40 per cent, per head, while the number of workers has decreased by 7 per cent. Rationalization we cannot stop; we do not seek to go back to Ludditeism; we must have efficiency and must develop our economic resources.

The honorable member for Wimmera (Mr. Stewart) asked why the workers in this country should enjoy a higher standard of living than that of the workers of other countries. Australians claim the right to a higher standard of living, first, because their forebears left their native land to seek in a new country better economic conditions and greater opportunities than were possible in the older lands; and, secondly, because the immense resources of this country, as yet largely unexplored and undeveloped, together with the industry of its people, have enabled us to produce, per head of the population, more wealth than any other country. Since, by their labour, the workers produce and create that wealth, they are entitled to participate in the values thus created to a greater extent than are the workers in other countries, whose natural resources are not so great, and in which the industry of the people does not yield equivalent results. The honorable member said that while the people of Australia belittled other countries they were prepared to borrow money from them. We have gone to other countries for money because we have been opening up and developing this country and have not established secondary industries to supply the needs of our people. Those other countries, with their longer industrial experience, have been able to accumulate immense financial resources not possible in a country still in its initial stages of development. When our iron and steel industry has been so developed that we shall be able to supply our own requirements in the case of manufactured goods, there will be no need to import such goods from overseas, or to seek financial assistance outside Australia.

– The Minister for. Home Affairs (Mr. Blakeley), who is gracing the chamber with his presence for a few minutes in order to see how things are going, is restive because any one speaks to the item at all. He wants to bring in his voters and settle the matter straight away, without even the make believe of a preliminary discussion. I realize that that is what the Government wishes, but I do not propose to give a silent vote. I realize that this is a national industry; that it should be assisted. An industry of this nature should be built up and developed. It is a national and natural industry, and is entitled to just and reasonable treatment; but equal care must be taken that it should not be developed to the detriment of other industries. In considering this item, we have to ask ourselves whether the measure of assistance granted by the last Government was sufficient. I am of opinion that it was, and that no further assistance is necessary than was granted in the 1921-28 tariff. I am convinced that the industry can be developed and maintained with that degree of assistance, and that any further assistance may only tend to retard the progress of Australia. The Minister admits that the inquiry on which these proposed increases are based took place five years ago. The Tariff Board’s report is dated 1926. I ask honorable members to pause and consider what tremendous changes have taken place during the last five years. Are they prepared to concede that the conditions which existed five years ago should be taken as the basis upon which assistance is to be granted to the iron and steel industry to-day?

Mr RIORDAN:

– Was the 1926 report submitted to the House at the time?

Mr. ARCHDALE PARKHILL.Yes.

Mr Riordan:

– The honorable member is mistaken ; it was never submitted.

Mr. ARCHDALE PARKHILL.Although I answered the honorable member’s interjection, I am bound to say that I do not see its relevancy to the matter under discussion, because the Minister has already admitted that the proposed increases are based on the 1926 report, and he prides himself on the fact that, in framing the duties, he has not gone so far as the Tariff Board recommended. Another inquiry should be instituted at once. Whenwe realize that the iron and steel industry provides the raw material for a great many other industries, and that its products enter into the manufacture of thousands of necessary commodities, we should not hesitate to spend a few pounds in the conduct of such an inquiry. The prosperity of the country is bound up with the iron and steel industry, and we should endeavour to arrive at a fair working arrangement which would do justice, not only to the iron and steel industry, but also to other industries which are dependent upon it. Compare the attitude of this Government and this Parliament to the iron and steel industry with that adopted by the Parliament of Canada to the industry as carried on in that dominion. Here the discussion is being carried on in a half empty chamber, with the Government’s supporters quite uninterested in the proceedings. In Canada a most searching inquiry was made into the industry in all its ramifications. The investigators learned what could be economically manufactured in the country, and what it would be better to import from Great Britain. A schedule was then drawn up in which a duty was placed on the ordinary commodities which could be made by mass production in Canada as cheaply as they could be imported. Then, in a separate schedule, were placed such things as rolled steel, for which there was only an occasional demand, and it was arranged that they should be imported from Great Britain on” preferential terms. In the preparation of this report, assistance was obtained from those government departments interested in the production of iron and steel for railway purposes, from accountants and experts of the various firms concerned with the iron and steel industry, and from the importers of iron and steel commodities. In this way a national report was obtained which should remain applicable to the industry and its needs for many years to come. Again, compare that with the way in which the matter is dealt with in this chamber. The Minister comes forward and reels off a few details supplied to him by departmental officers, but refrains from giving to the committee any reasoned statement concerning the industry or its prospects. In effect, he throws the items on the table, and says, “ There they are “ ; and he gets his supporters to come in and vote “them through.

Mr ARCHDALE PARKHILL:

– I withdraw it. It is all very well for the honorable member for Corio and other honorable members to criticize Great Britain and to animadvert upon the payment of the dole as evidence of Britain’s decline. The late Lord Balfour and Mr. Winston Churchill described the position of Great Britain in the way it is explained in the article from which I have read a brief quotation. The payment of the dole in Great Britain is misunderstood. Many of the men on the so-called dole are simply receiving payment from a national unemployment insurance fund to which they are entitled. The honorable member for Corio said that as we produce great wealth in this country those engaged in its production are entitled to high wages. He referred to those men who had left older countries to settle in this new land because of the greater opportunities it offers. Statements of that kind may be all right on the Yarra bank, but they are of no consequence in a deliberative assembly. The point is that we do not produce sufficient wealth in this country to pay these high wages, liberal pensions, and generous social services that have been handed out so indiscriminately. To combat the argument that favours the continuance of the existing high wages in the iron and steel industry, irrespective of the consequences, I draw the attention of the committee to the excessive cost thus imposed on all associated industries which prevents their competing with world’s parity, and precludes their paying a reasonable wage.

The honorable member for Herbert (Mr. Martens) claimed that the introduction of machinery is responsible for many of the labour difficulties that confront modern civilization. I submit that that is an unsound hypothesis. If we went in for massed production on a large scale there might be something in the contention, but at present our use of machinery in industry has not the effect he claims. As no evidence has been supplied by the Minister in support of this increase, and as the duties granted in 1928 were to my mind sufficient to establish the industry satisfactorily in Australia, I do not intend to support this item.

Mr JAMES:
Hunter

.- As I listened attentively to the opening remarks of the honorable member for Warringah (Mr, Parkhill) I began to take stock of myself, and wondered why I was supporting something to which the honorable member appeared to be prepared to give his support. There was, however, as usual, a “ but “ in the business ; the honorable member went on to say that the duties should be made what he termed to be “ reasonable.” I point out that the duty now granted by this Government is not as liberal as that recommended by the Tariff Board in the report that it submitted to the BrucePage Government in 1925. Why did not that Government act upon those recommendations? Incidentally, I do not think that the honorable member for Warringah knows very much about the iron and steel industry. I am confident that he does not know what pig iron is, or how many “ hams “ come out of a ton of that commodity.

The iron and steel industry deserves every possible encouragement. It is the lifeb’lood of Newcastle and the surrounding districts, and employs approximately 4,000 persons when it is in full swing. Further, it uses approximately 1,000,000 tons of coal per annum. The BrucePage Government, in conjunction with the New South Wales Government, headed by Mr. Bavin, and the South Australian Government, led by Mr. Butler, urged that the industry should be assisted by a reduction in the price of coal, to be borne only by the workers in the latter industry, in the form pf a reduction in wages. In its report of the 30th June, 1925, the Tariff Board said -

In the Tariff Board Report of 30th June. 1.925, page ]3 - In anticipation of dealing ultimately with the request for increased duties by the iron and steel industries of the Commonwealth, which -was then before them to be dealt with at a later stage, said by way of comment -

It is obvious that any alteration in the upward direction in the duties on the basic manufactures of iron and steel would necessitate a similar recasting of the duties already fixed on the whole of the engineering and allied interests.

Accepting the principle here laid down and taking into account that the long and very complete revision of the duties which were fixed in the Tariff Revision of 1920-21 had established a proper relationship between the basic iron and steel duties and the engineering and allied interests.

We were in a position to show the results on all the items the iron and steel industry sought duties upon (but thought two examples would suffice).

The anomaly then created, we thought, should be adjusted and subsequently it waa by the schedule of duties under the present customs tariff.

The relationship of the duties on “ Basic Metals “ and the “ Engineering and allied interests “ were profoundly disturbed as from 3rd September, 1925, as the following statement, submitted at the time disclosed.

It has to be noted that the end result of the statement “ Pig Iron “ comes out at 34s. 5d. per ton (British preference) as against 25s. per ton under the existing tariff and on “Merchant Bar” 74s. 9d, per ton (British preference) as against 80s. to-day.

The industry of Lysaghts Limited, manufacturers of galvanized and sheet iron, is subsidiary to our great iron and steel industry, and ‘its application for adequate protection is referred to in the report of the Tariff Board of 1925 as follows : -

The applicants have asked for an increase in duty to £5 per ton against the United Kingdom and £7 against other countries. While the board is in favour of further protection of this industry, it is against increasing the present duty unless by so doing, the local manufacturer will undertake to supply requirements outside of New South Wales, as well as within that State. It would be unfair, in the opinion of the board, to users in Western and South Australia to be saddled with a higher duty on a necessary commodity unless supplies could be locally secured.

When the Australian manufacturers have laid down a plant competent to reasonably cope with the requirements of the Commonwealth, the Tariff Board will be prepared to recommend that an adequate duty be substituted for the present and suggested bountycumduty protection.

Lysaghts Limited extended their plant so that it is capable of manufacturing 80,000 tons of galvanized iron ; but it is now found that there is only sufficient work to keep it going half time, with an output of 30,000 tons per annum. That firm has fulfilled all the conditions laid down by the Tariff Board. A duty of £5 10s. a ton was promised in 1921, but later the Tariff Board recommended that that should be reduced to £4 10s. a ton. The employees in the subsidiary industry number 964. Then there are 640 men working on iron bars at the works of the Broken Hill Proprietary Limited. Directly and indirectly, taking into consideration those who are engaged in Tasmania and South Australia, 2,500 men are affected by that industry. The Electrolytic Zinc Corporation in Tasmania disposes of 20 per cent, of its output to the industry; and its iron ore supplies are obtained from South Australia. Thus the industry either benefits or caters for the requirements of every State inthe Commonwealth.

In the amount of protection granted to the industry, Australia compares unfavorably with other countries, where the rates of duty for galvanized iron are as follows : -

South Africa - Free British, 3 per cent, foreign ;

Canada - 15 per cent. British, 25 per cent. foreign ;

India- -£5 per ton.

Brazil - £8 15s. per ton;

Argentine - £7 12s. per ton;

Italy - £9 13s.6d. per ton.

France - £46s. 8d. per ton;

United States of America - £4 7s.6d. per ton.

It should be pointed out that South Africa, which does not manufacture galvanized iron, allows the British product to enter free of duty. There should, therefore, be no complaint regarding the rates which a young country like Australia has imposed in order to build up a secondary industry. It is apparent to me that some honorable members opposite are more concerned about building up industries overseas than in Australia.

That the manufacturers are not taking advantage of the consumers, as the honorable member for “Warringah (Mr. Parkhill) and other honorable members would suggest, is shown by the following comparative prices in 1920 and 1930: -

Those reductions are considerable, and they prove conclusively that the manufacturers are endeavouring to cater for the requirements of Australia at reasonable’ rates. The amendment of the honorable member for Swan (Mr. Gregory) should be rejected by the committee, and the item agreed to.

Mr HAWKER:
Wakefield

– This is one of the protected industries from which South Australia derives some benefit that offsets the cost to her of other protected industries, and on that account I consider that it is necessary for me to place on record my reasons for not being able to support the increased duties proposed by the Minister.

There are several reasons for the industry being particularly suitable for Australian conditions. All the materials that it uses are Australian, and the cost of the finished article represents practically the cost of labour only. The industry does not use materials which, if not worked up locally, would be exported. It is an industry which leads to almost entirely new production. Yet I am not able to support the increased duties, because I believe that it is not fair to ask the community to bear them in view of the relative standards of prosperity that are enjoyed in different parts of Australia to-day. Another reason is that if the duty is used by the manufacturers to increase prices, the effect must be to restrict the use of iron products in Australia, when the reverse process of increasing employment is desired. Some honorable members opposite have said that they do not believe that if wages were very greatly reduced a larger number of men would be employed. This industry has proved how easy it is to demonstrate that the reverse is the case. One of the principal products of the industry is galvanized iron. Unemployment is probably as great in the building trade as it is in any trade in Australia. On account of the high rate of exchange, a good deal of money is being left in Australia by oil companies and other overseas firms which trade with Australia; and if building costs were lower, some of that money would undoubtedly be used in the erection of buildings in this country for the accommodation of those firms.

In some cases that is actually being done with costs as they are. To-day one of the principal building jobs in Adelaide is the big building for the Shell Company on North-terrace. Unfortunately, owing to the high costs and other circumstances, there is little prospect of big companies investing their money in Australia in extending their plant and buildings, even when they are holding funds here, because of the exchange rates. We must make the conditions reasonable before this will be done.

The cost of iron and steel products is important to farmers and graziers. It is not fair that the requirements of these people in this direction should be made more expensive because of unnecessarily high duties. The Australian producers of iron and steel have secured practically the whole market for ordinary iron and steel products. In connexion with galvanized iron, for instance, the Tariff Board reported as follows at page twelve of its report on this subject : -

Outside tlie “Steel agreement” the ‘Broken Hill Proprietary Company Limited recently made a further reduction of 4s. per ton in the price of steel to Lysaghts on account of the lower production costs resulting from reductions in the price of coal at the termination of the recent industrial dispute on the coalfields.

It will be seen, therefore, that the position of the Australian producers, in comparison with the position of overseas manufacturers, is relatively better to-day than it was some time ago. It is true that the manufacturers may not increase their prices if the higher duty is approved; but when there is no need to increase the duty we should not increase it. On the whole, I believe that the iron and steel manufacturers have given the Australian public a fair deal; but the fact that there has been no abuse in relation to prices in the past is no justification for granting additional protection when the conditions are relatively better than they were some time ago.

Much has been said during this debate about the effect of the price of galvanized iron on the man on the land, and particularly on the man who has recently settled in new country. In this connexion I quote the following extract from evidence given by Professor Richardson before the South Australian Disabilities Commission : - generally, farmers in the Mallee districts are men with limited capital, who are unable to provide shelter for their implements, and must necessarily accept an increased depreciation charge rather than a higher capital cost. If the price of galvanized iron is high the new settler is very seriously handicapped, for he cannot properly protect his implements.

The excessive price of iron and steel also has a serious effect upon the price of implements as the following letter, published in the Argus in March of last year, will show : -

“IS PROTECTION OVERDONE?”

Sir, - We recently imported 10 tons of mild steel to make agricultural implements. The costs of the steel at the factory where it was manufactured amounts to £6 1 5s. a ton. The customs duty at Melbourne was £6 10s. a ton; sea freight and other shipping charges, £3 3a. a ton; rail freight and cartage to country station, £1 7s.7d. a ton, making the total costs at our factory £17 15s. a ton for raw material, valued at £6 15s. at the foreign factory. - Yours, &c,

Country Manufacturer. 7 th March.

As there is about a ton of steel in the more expensive farming implements, it is clear that protection of the kind we are now considering has the effect of seriously raising the cost of farming implements. Our manufacturers have secured practically the whole of the local market for the common types of iron and Steel, and this extra duty will affect principally a few sizes not yet rolled in Australia. In a time when there is general depression throughout the country it is not fair to increase duties. The effect of doing so will be to hit the man on the land, and to protect certain shel tered and favoured industries. If these duties are necessary for any reason, it is because of the extravagant policy followed by Mr. Lang in New South Wales. Some industries operating in country districts, of which honorable members opposite, who represent rural areas know a good deal, are paying almost contemptible wages in comparison with the wages being paid in the iron and steel industry. The people in steel industries should not have their already low standard still further depressed in order that Mr. Lang may maintain a 44-hour week, child endowment and many other privileges in New South Wales.

Mr Ward:

– Does not the honorable member believe in those things?

Mr HAWKER:

– They are highly desirable if the country can afford them; but they are all wrong when they have to be paid for by industries which are operating on wages only about one-third of those paid in the iron and steel industry.

Mr Ward:

– The honorable member believes in paying our interest abroad whether we can afford to pay it or not.

Mr HAWKER:

– I believe in reducing our interest rates in a proper way. The honorable member for Newcastle (Mr. Watkins) and the honorable member for Hunter (Mr. James) gave us some important figures in regard to the Canadian iron and steel industry, which the Minister omitted from his statement. Wages and conditions in Canada are at least as good as those in Australia; but their iron and coal deposits are not as good as ours. Moreover, the Canadians are closer to the competition of Europe and America than we are. Yet their iron and steel industry, which is considerably bigger than ours, is able to carry on with a 15 per cent, duty against British competition, whereas we are being asked to agree to a duty 60 per cent, above the 15 per cent, of Canada - that is to say 25 per cent. The increase in the duty is not great compared with that on most items of this schedule but it applies to some of the most essential commodities required by other industries. The increase is not vital to the continuance of the iron and steel industry, and I cannot support this extra impost on the general public, and, particularly, on the primary producers. I hope that, at any rate, some of the honorable members opposite who represent primary-producing districts will have a sufficiently keen appreciation of the true interests of their constituents to vote for the amendment.

Question - That the amendment (Mr. Gregory’s) be agreed to - put. The committee divided. (Temporary Chairman - Mr. Keane.)

AYES: 15

NOES: 28

Majority . . 13

By omitting the whole of sub-item (c) and inserting in its stead the following sub-item: - “(c) (1) Bar, rod other than Wire rod in coils, angle, tee; bars of fancy pattern in the state in which they leave the rollers, per ton, British, 80s. ; intermediate, 110s.; general, 130s.;

(2) Wire rod in coils, per ton, British, 44s. ; intermediate, 65s. ; general, 80s.”

AYES

NOES

Mr FORDE:
Minister for Trade and Customs · Capricornia · ALP

– I move -

That the item be amended by adding, after item (c), the following: - “And on and after the 11th June, 1931 -

(1) Bar, rod other than wire rod in coils, angle, tee; bars exceeding one-eighth of an inch in thickness, of fancy pattern rolled direct from the billet bar or rod and in the state in which they leave the rolls, per ton, British, 80s. ; intermediate, 1 10s. ; general, 130s.
1. Wire rod in coils, per ton, British, 44s. ; intermediate, 65s.; general, 80s.”

The proposed amendment is purely departmental. The intention was to admit fancy bars, provided no processes other than rolling from the billet bar or rod had been effected. The present wording, however, leaves it open for sheet metal to be moulded to a shape, and admitted under this item. The proposed wording will ensure that the intention will be carried out.

Mr GREGORY:
Swan

.- When important amendments are to be proposed, the Minister ought to have them circulated among members of the committee.We are entitled to at least half an hour’s notice of such amendments.

Amendment agreed to.

Progress reported.

page 2646

ADJOURNMENT

Price or Explosives

Motion (by Mr. Brennan) proposed -

That the House do now adjourn.

Mr RIORDAN:
Kennedy

– I should like to know if inquiry has been made to ascertain the reason for the higher cost of explosives in Australia as compared with prices overseas. This is a matter which I raised the other night and the Attorney-General then promised to have the matter investigated.

Mr BRENNAN:
AttorneyGeneral · Batman · ALP

– Inquiries are being made and I hope to be able to furnish the necessary information at an early date.

Question resolved in the affirmative.

House adjourned at 10.42 p.m.

Cite as: Australia, House of Representatives, Debates, 10 June 1931, viewed 22 October 2017, <http://historichansard.net/hofreps/1931/19310610_reps_12_130/>.

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House of Representatives10 June 1931

QUESTION

LOANS

Mr NAIRN:PERTH, WESTERN AUSTRALIA

Mr THEODORE:Treasurer · through Mr. Holloway · ALP

QUESTION

PRICE LEVELS

Mr TULLY:BARTON, NEW SOUTH WALES

WESTERNPORT NAVAL BASE

Personnel

Mr CROUCH:CORANGAMITE, VICTORIA

QUESTION

GOLD SALES

Mr TULLY:

Mr THEODORE:through Mr. Hollow ay · ALP

QUESTION

BANKRUPTCY ACT

Mr HAWKER:WAKEFIELD, SOUTH AUSTRALIA

Mr BRENNAN:Attorney-General · BATMAN, VICTORIA · ALP

QUESTION

POET AUGUSTA TO BED HILL RAILWAY

Mr MACKAY:LILLEY, QUEENSLAND

Mr PARKER MOLONEY:HUME, NEW SOUTH WALES · ALP

QUESTION

TELEGRAPHIC TRANSFERS ON LONDON

Mr PRICE:BOOTHBY, SOUTH AUSTRALIA

Mr THEODORE:through Mr. Holloway · ALP

QUESTION

CRIMES ACT

Mr JAMES:HUNTER, NEW SOUTH WALES

Mr BRENNAN:ALP

QUESTION

PUBLIC SERVICE

Mr CUNNINGHAM:GWYDIR, NEW SOUTH WALES

Mr BLAKELEY:DARLING, NEW SOUTH WALES

QUESTION

DUTY AND EXCISE ON SPIRITS

Mr FORDE:Minister for Trade and Customs · CAPRICORNIA, QUEENSLAND · ALP

QUESTION

CUSTOMS DEPARTMENT

Mr SCULLIN:Minister for External Affairs · through Mr. BrenNAN · ALP

PAPERS

TARIFF

Customs Duties

In Committee of Ways and Means:

Item 136-

Mr FORDE:Minister for Trade and Customs · Capri cornia · ALP

Mr Prowse:

Mr FORDE:

Mr Paterson:

Mr FORDE:

Mr Stewart:

Mr FORDE:

Mr Stewart:

Mr FORDE:

Mr Hawker:

Mr FORDE:

Mr Bell:

Mr FORDE:

Mr Paterson:

Mr FORDE:

Mr FORDE:

Mr Paterson:

Mr FORDE:

Mr GREGORY:Swan

Mr WATKINS:Newcastle

Mr Maxwell:

Mr WATKINS:

Mr Gregory:

Mr WATKINS:

Mr Gullett:

Mr WATKINS:

Mr Gullett:

Mr WATKINS:

Mr Gregory:

Mr WATKINS:

Mr Prowse:

Mr WATKINS:

Mr Paterson:

Mr WATKINS:

House of Representatives
10 June 1931

Mr NAIRN:
PERTH, WESTERN AUSTRALIA

Mr THEODORE:
Treasurer · through Mr. Holloway · ALP

Mr TULLY:
BARTON, NEW SOUTH WALES

Mr CROUCH:
CORANGAMITE, VICTORIA

Mr THEODORE:
through Mr. Hollow ay · ALP

Mr HAWKER:
WAKEFIELD, SOUTH AUSTRALIA

Mr BRENNAN:
Attorney-General · BATMAN, VICTORIA · ALP

Mr MACKAY:
LILLEY, QUEENSLAND

Mr PARKER MOLONEY:
HUME, NEW SOUTH WALES · ALP

Mr PRICE:
BOOTHBY, SOUTH AUSTRALIA

Mr THEODORE:
through Mr. Holloway · ALP

Mr JAMES:
HUNTER, NEW SOUTH WALES

Mr BRENNAN:
ALP

Mr CUNNINGHAM:
GWYDIR, NEW SOUTH WALES

Mr BLAKELEY:
DARLING, NEW SOUTH WALES

Mr FORDE:
Minister for Trade and Customs · CAPRICORNIA, QUEENSLAND · ALP

Mr SCULLIN:
Minister for External Affairs · through Mr. BrenNAN · ALP

Mr FORDE:
Minister for Trade and Customs · Capri cornia · ALP

Mr GREGORY:
Swan

Mr WATKINS:
Newcastle

Mr D CAMERON:
BRISBANE. QLD · NAT

Mr D CAMERON:
BRISBANE. QLD · NAT

Mr D CAMERON:
BRISBANE. QLD · NAT

Mr D CAMERON:
BRISBANE. QLD · NAT

Mr D CAMERON:
BRISBANE. QLD · NAT

Mr PATERSON:
Gippsland

Mr PATERSON:
GIPPSLAND, VICTORIA · CP from 1922; ST CP from 1937; LCP from 1940

Mr LONG:
Lang

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

Mr M CAMERON:
BARKER, SOUTH AUSTRALIA · LP; NAT from 1925; UAP from 1931

Mr BELL:
Darwin