12th Parliament · 1st Session
Mr. Speaker (Hon. Norman Makin) took the chair at 2.30 p.m., and offered prayers.
Premiers Conference Decisions.
– by leave - Since Parliament adjourned early in August, I have been almost continuously at meetings of the Premiers Conference, the Loan Council, and the National Appeal Executive appointed in connexion with the National Debt Conversion Loan. Honorable members will recollect that a plan of rehabilitation was evolved by the conference of Premiers which met in Melbourne in June last As the Australian Governments have substantially given effect to that plan, I propose now to make a short review of the position as it existed when the June conference met, the plan then evolved, the action taken to give effect to the plan, and the further proposals for national rehabilitation.
June Conference Plan.
At the Premiers Conference in June, the anticipated deficits of the seven Australian Governments were set down at £41,080,000.
The conference set itself out to reduce these deficits to manageable amounts, and adopted a plan embracing the following measures : -
The additional reductions in expenditure, and the new taxes proposed as part of the plan, were estimated to reduce tha deficits by £26,430,000, leaving the total deficits, after these adjustments had been made, at £14,650,000.
The conference understood that as a result of the operation of the plan, money would be available for financing thi reduced deficits of the Governments and for the stimulation of industry.
When the conference resumed its sittings in Melbourne early in August, it received a report from the Treasury officers in which the action taken, by tha several governments in regard to budget adjustments was reviewed. This report will be made available to honorable members as soon as it can be printed. It disclosed the following result: -
The increased deficits as reported in August were, to the amount of approximately £1,000,000, due to the fact that a full year’s saving of interest under the Conversion Loan will not be realized during the present financial year, though in subsequent years the saving originally anticipated will be secured.
Alter discussing whether each government had given full effect to the June conference plan, the August conference decided to seek finance from the Commonwealth Bank to cover the deficits as agreed upon at the June conference, approximately £15,000,000, plus the shortage for this year of interest savings.
The particulars of the savings provided for in the Commonwealth and State budgets are as follows : -
Further reductions have still to be effected in New South Wales.
The following table shows the average percentage reduction for the Public Service proper and for all services respectively. The figures are exclusive of rationing, and exclusive of unemployment relief taxes : -
An examination of the information furnished by the various governments showed that the’ proposed economics in expenditure had been substantially effected.
The plan embraced the securing of additional revenue by taxation. The Commonwealth has passed legislation designed to secure £7,500,000 of additional taxation in accordance with the June plan. The proposals of the States for securing additional taxation have not yet been finalized. It was indicated that New South “Wales expected £1,500,000 under the Transport Act; that Victoria expected to receive £715,000 from in creases in income tax, probate duty, and stamp duty, and by transfers from the Roads Fund; whilst Tasmania expected to receive £80,000 from increases in income tax and stamp duty..
The Conversion Loan, which was an important feature of the June conference plan, has been a signal success. Voluntary conversions actually advised numbered 200,000, representing over £500,000,000, whilst dissents totalled £17,500,000. As the holdings of those who did not dissent within the prescribed time will be automatically converted, the position is that approximately £538,000,000 out of the £556,000,000 of internal debt has now been converted, and of this sum holders of over £500,000,000 advised their willingness to convert.
The position in regard to dissentients was considered by the Premiers Conference. . It was quite clear from advices received that hardship was involved in many cases in which conversions were willingly made - hardships just as severe as those which had led others to dissent. As the amounts in respect of which dissent was notified represented only a little more than 3 per cent, of the total internal debt, the conference was of opinion that whatever action was taken in regard to dissents, persons who dissented could not be allowed to remain in a more favoured position than those who had converted.
Another fact which emerged from the conversion operation was that some provision must be made for persons who would suffer hardship through their inability to withdraw their capital when their old securities matured. It was clear that many holders of relatively small amounts were relying on a portion of their principal moneys to provide necessary maintenance expenditure.
This position was discussed with the Commonwealth Bank, and it was agreed that the bank and the Treasury in cooperation should take action towards alleviating the position of those who require a portion of their money for their maintenance. A plan is now being drawn up under which the Treasury will provide a substantial sum from the sinking fund so that the Commonwealth Savings Bank. may meet, from time to time, the requirements of bondholders for maintenance purposes. This plan will apply to holdings of persons who converted as well as to those who dissented because they feared hardship.
The Premiers Conference, after careful consideration of the position of dissentients, unanimously decided that, in view of the fact that holdings of 97 per cent. o£ government securities had been voluntarily converted, the small proportion of securities which had not been converted should be converted on the same terms as the others, and that the respective governments should be asked to take legislative action accordingly. The Government proposes to introduce legislation at an early date to give effect to its decision.
The Commonwealth Bank has made a general reduction of 1 per cent, in interest on both deposits and advances. The trading banks have announced an allround redaction of 1 per cent, in interest on deposits and an average reduction of 1 per cent, in interest on advances. The procedure among the trading banks is not uniform, the reduction being greater than 1 per cent, in some classes of cases and less in others. In the ease of some banks the full reduction will not operate until the 1st October
The Commonwealth Savings Bank, the State Savings Banks in South Australia and Western Australia, and the Trustee Savings Banks in Tasmania have reduced deposit rates by 1 per cent. In Victoria and in New South Wales the reduction is half per cent. Generally speaking, the savings banks have made corresponding reductions in their lending rates.
In all the States, except New South Wales, action has been taken to provide relief in respect of private mortgages. New South Wales proposes to introduce a measure dealing with this matter at an early date.
EMPLOY MErT and assistance to Industry.
The Premiers Conference this month closely examined’ proposals in regard to loan works at present in hand, new loan works to provide employment, and assist- ancc to wheat-growers.
The conference considered it essential that existing loan works, which directly give employment to about 18,000 men. be carried on, and that pending the absorption of workers in private industry the employment position . should be relieved by the governments commencing new works to a limited extent. The con .ference was also strongly of opinion thai wheat-growers must be given relief. It accordingly asked the Commonwealth Bank to arrange finance for the following purposes: -
For existing works, £8,500,000 for 1931-32.
For new works, £5,000,000 during the next six months.
For wheat, £3,000,000 to enable the Commonwealth to pay a bounty of 6d. per bushel on export wheat of - the 1931-32 season.
The Commonwealth Bank was unableto see its way clear to finance these requirements in addition to the deficits for 1931-32. After a conference between the Premiers and the Commonwealth Bank Board, the Commonwealth Bank suggested that the trading banks be called into consultation. A3 a result the Premiers, on Friday last, met representa.tives of the Commonwealth Bank and the trading banks, and discussed the whole position. v
It has now been agreed that the Commonwealth Bank and the trading banks, acting in co-operation, will provide -
– The conference was unable to induce the banks to consent to make any provision for last season’s wheat harvest. The only basis on which they would negotiate an advance was for future production, so that the conference had to confine its request to the 1931-32 season, and then every endeavour had to be exerted before the £3,000,000 advance could be obtained. The banks stated, however, that they were unable to provide additional moneys for new loan works during the next six months.
As to the oversea position, Australia, as a. debtor nation, dependent largely on exports of primary products, must look to the oversea nations for that international co-operation which will bring about an improvement in prices for primary products and make it possible for the debtor nations of the world to continue to meet their obligations in full. The difficulties in that direction have been accentuated by recent developments in Great Britain.
I have shown that the desperate financial situation which faced Australia a few months ago has been grappled with by the Commonwealth and State governments. The plan for bringing deficits down to manageable amounts has almost been carried into effect. The people of Australia and our creditors oversea should now realize that Australia has taken drastic measures for the financial rehabilitation of the nation. The action taken by the governments justifies us in asking private citizens, and particularly financial institutions and employers, to embark on ali measures possible for expanding industry and increasing employment.
I regret exceedingly the decision of the banks not to give assistance for new works to absorb unemployed. It is true that the banks have agreed to finance government deficits; to carry on existing works and also to provide money for the proposed wheat bounty; but they do not appear to realize fully the necessity for government action to reduce unemployment.
Unemployment is the greatest problem confronting the nation to-day. I do not suggest that -the provision of £5,000,000 for six months would solve it. It was hoped to start about 40,000 men at work, and simultaneously urge private employers to make a definite .move in anticipation of the increased demand for commodities that -would set in. Such action by employers would further increase the demand. Industries generally would be stimulated, and unemployment considerably reduced. The Premiers Conference and Loan Council, after considering the matter from every aspect, were unanimous in their representations to the banks. The proposals submitted were not extravagant. It was realized that the banks have many heavy commitments. A restrictive monetary policy, however, to make positive provision against future dangers will avail us nothing if an industrial and social crisis is thereby precipitated.
Many avenues have been explored in the attempt to find means to reduce unemployment. A way out must be found if the nation is to be preserved. I received the banks’ reply only to-day. The Government will give serious consideration to that communication, and to the steps that can be -taken by the governments and people to relieve distress -and avert disaster.
I lay on the table the document that 1 have read, and move -
That the paper be printed.
Debate (on motion by Mr. Latham) adjourned.
Motion (by Mr. Bayley) - by leave -agreed to -
That leave of absence for one month be granted to the honorable member for Moreton (Mr. Fra noi s) on the ground of ill-health.
Hates of Interest
– What is the rate of interest proposed to be paid on the advances that will be made by the banks to the Commonwealth and State governments?
– The rate is tile same as that now charged on treasury-bills already held by the banks, 4 per cent.
– In order to correct the false statements made regarding the nature of the offer of the Commonwealth Bank Board to assist in the re-opening of the New South Wales Government Savings Bank, will the Prime Minister make a full statement on the matter, and also lay upon the table of the library the documents setting out the exact terms of the Board’s offer?
– I was under the impression that the whole of the correspondence was made available by the chairman of the Commonwealth Bank Board. If anything has been withheld, I shall see whether it is possible to make it available.
– Will the Treasurer state whether the Government has considered any scheme whereby the country may be relieved of the present excessive exchange rates on overseas interest payments, and other commitments abroad ?
– The problem arising from the payment of exchange on the interest owing on external debts has received the earnest consideration of the Commonwealth Government. There is no means whereby we can avoid these payments while the present difference exists between price levels in Australia and elsewhere, and between the value of our currency and that of other countries. The subject is still receiving consideration.
– Has the attentionof the PrimeMinister been called to press reports of the proceedings of the recent Premiers Conference, stating that the Commonwealth Government intended to request the banks to advance £400,000 in order to push on with the Red Hill to Port Augusta railway? Will the Prime Minister assure the House that, before any such action is taken, full consideration will be given to the recently published report of the Royal Commission on the South Australian Railways which, among other things, deals with this proposed undertaking?
– No specific proposal of the kind mentioned by the honorable member was considered by the conference. The Red Hill to Port Augusta scheme was included in a list of works which could be undertaken. The second portion of the honorable member’s question will receive consideration.
Agreement Between “ A “ Class Companies and Government. - Censoring of Speeches
– Will the Prima Minister state whether it is true that the agreement between the “ A “ class broadcasting companies and the Government has been renewed; and, if so, what are the terms of the new agreement?
– No new agreement has been made. The existing agreement does not expire until the middle of next year.
– I ask the Minister representing the Postmaster-General a question relating to a recent address by a communist broadcast from the Melbourne Trades Hall station, 3KZ. According to a report which appeared in the press, the Commonwealth Director of Postal Services stated that, although the department in theory exercised a censorship over programmes, it was not possible to maintain a definite check. Inview of the definite statement of the Minister, in reply to recent questions on the subject, will he explain why no censorship was exercised in this instance, and if it did happen that there was a misunderstanding, why was the broadcasting allowed to continue until the end, instead of being abruptly cut off by the department?
– The position in regard to broadcasting was, I think, clearly set out yesterday in reply to a question by the Deputy Leader of the Opposition (Mr. Latham). This is a matter which presents a great many difficulties. The policy of the Government, and the desire of all honorable members of this Parliament, is to allow the widest possible latitude, within certain definite limits, to those broadcasting. Of course, those who run broadcasting stations enjoy what is practically a monopoly, and must, therefore, be subject to some control. . I have discussed this matter with the Director of Postal Services in an endeavour to arrive at a working understanding. It is desired, on the one hand, to allow the greatest liberty of speech, whether over the air or from the public platform, while, on the other hand, it is necessary to safeguard the public interests from any dangers arising out of the exercise of a monopoly by a few persons or firms, and to prevent the introduction of abuses. The instruction has been issued that no partisanship whatever must be displayed in the control of broadcasting stations. From time to time, matter is broadcast which is considered objectionable. The honorable member for Balaclava (Mr. White) referred to an address broadcast from station 3KZ, which is the station controlled by the Trades Hall in Melbourne. An explanation of the incident has been already published. The manager and secretary of the company which controls that station made a public statement to the effect that they had been deceived. They stated that one gentleman had asked permission to broadcast for half an hour during the time allowed for speeches. He gave the title of his address, which purported to bc an appeal for the relief of distress, and be was granted permission to speak. When the time came, he was unable to attend, and at the last minute another gentleman came along and delivered an address of such a nature that, had the management known of it, they would not have allowed it to be broadcast. The honorable member for Balaclava suggested that the address might have been cut off when its nature became apparent, but the power of cutting off a broadcast during its progress probably rests in the hands of a mechanic, who could not be expected to act in the capacity of a censor. A full explanation of the incident has been furnished by representatives of the company, and they will take precautions that they are not imposed upon again.
– Will the Prime Minister consider tha desirableness of giving notice of the diecontinuance of the present agreement with the Australian Broadcasting Company and the establishment, in its place, of a national board with national orchestras at Sydney and Melbourne?
– The Government’s policy with reference to broadcasting must receive consideration very shortly. I shall be very glad to have any helpful suggestions.
– Has the attention of the Minister representing the PostmasterGeneral been directed to the subjectmatter of an address delivered by Senator
Sir George Pearce in the Perth Town Hall on the 18th August which was broadcast by the “A” class station 6WF ? Also, is it a fact that the broadcast of the speech in question was arranged by Mr. A. M. Macdonald, ‘the secretary of the Nationalist party in Western Australia, and Mr. Basil Kirke, manager- of 6WF, and did Mr. Kirke declare that there had been an absolute breach of faith on the part of the parties concerned ? Is it a fact that the speech was to be delivered in conformity with a promise that a synopsis would be made available to the management, and was the speech, as delivered, checked by the synopsis to see if new matter had been introduced? Finally, is it a fact that, under the guise of making an appeal on behalf of the national debt loan conversion campaign, Senator Pearce entered into an extensive defence of the financial administration of the BrucePage Government?
– My attention has not been drawn to the speech referred to, but I would say that if permission to broadcast a speech through an “ A “ class station was given for the purpose of appealing on behalf of the loan campaign, it would be a distinct breach of faith to introduce anything in the nature of party politics.
– As the British Board of Trade returns show that the imports of Soviet butter into Great . Britain during August have increased by 687 per cent., compared with August, 1930, will the Prime Minister make the strongest protest to the British Government against such importations, in the interests of the Australian dairying industry, and -the preservation of the British market, which is so imperative to the welfare and expansion of the dairying industry in this country ?
– I have already made “ the strongest representations to the British Government in an endeavour te obtain for our exports preferential treatment in return for the preferential treatment we have accorded to exports from Great Britain. . I do not think that, at this time, I can add anything to the representations already made.
– An unemployment relief committee, which is dependent for its revenue upon voluntary contributions from the public, spent, between the 11th July and the end of August, £152 on the purchase of clothing and leather, in order to make boots and other wearing apparel available to necessitous cases. On this sum the amount of £9 16s.8d. has been charged as sales tax. Seeing that the money spent represents voluntary contributions by the public for the relief of distress, will the Treasurer state whether it is possible to refund the amount of the sales tax in this and similar instances, or, if the law does not at present permit this to be done, will he take steps to have the law amended?
– I shall consider the matter, and let the honorable member know what can be done.
– Will the Treasurer make arrangements for the payment of old-age and invalid pensions to distressed persons possessing deposits in the New South Wales Government Savings Bank, the amount of the pensions to be refunded to the Commonwealth Treasury by the bank when it is in a position to pay out on deposits?
– If the honorable member will furnish me with particulars of his proposal, I shall give it consideration.
– Will the Prime Minister get into communication with Mr. Eric Campbell who, I understand, is the commander-in-chief of the New Guard in New South Wales, and inquire if that gentleman’s references to socialistic governments which need to be watched, include the present Commonwealth Government?
– I have not the time to write to private individuals to obtain from them an expression of their political views,
– I ask the Minister for Trade and Customs, in view of the projected price war between those responsible for the importation of Russian petrol and the existing oil companies in Australia, if his department has any knowledge of extensive imports of Russian petrol ?
– The only importation of Russian petrol of which the department has any knowledge was a consignment of about 200 gallons towards the end of last year. The department has not received advice of any further anticipated importations, but I shall have inquiries made, and inform the honorable gentleman of the result.
– If the department intends to make an investigation, I should like to know if the intention is to approach the consideration of the question with the idea of keeping the Australian market for the existing companies, . thus permitting them to continue their exploitation of the primary producers of this country?
– The only importation from Russia that has come under the notice of the Trade and Customs Department recently is a trial shipment of . timber, concerning which the Tariff Board is now making an inquiry, with a view to reporting whether it should be subject to the dumping duty, because of the conditions of labour under which it was produced. As we have no official information whatever of the importation of any other product from Russia, no investigation has been ordered, and no decision has been made by the Government concerning any importationsthat have been made.
– I have received a number of communications from constituents in Western Australia complaining of the excessive cost incurred by the Works Department in repairing telephone lines damaged through falling trees. Will the Postmaster-General take some action to make this expense as light as possible ?
– The matter will be investigated.
– Will the Treasurer inform the House if an agreement has been reached between the Government and the British Ministry for Pensions in connexion with the payment of exchange on pension payments to imperial pensioners resident in Australia? Also, in view of the fact that there is approximately a twelve months’ payment now owing to those pensioners*, will consideration be given to the payment of bank interest upon the arrears of pensions?
– A question dealing with imperial war pensions is on the notice-paper for to-day in the name of the honorable member for Wentworth (Mr. Marks), the answer to which will be furnished in due course. I may, however, inform the honorable member that an agreement has been” reached between the British pension authorities and the Commonwealth Treasury, and the payments are to be made. I think the first cheques went out to-day.
– -Is it the intention of the Minister for Trade and Customs, in pursuance of his promise given prior to the adjournment, to lay on the table of the House copies of the Tariff Board reports?
– It was not practicable to lay the reports on the table during the recess. If it is now the desire of the honorable gentleman to obtain certain reports, they will be laid on the table. [ have arranged with the department to prepare a list of all reports which have not been laid on the table. I may add that, when last I tabled the board’s reports, there was a storm of indignation from honorable members, and I then intimated that 1 would place no more on the table except at the definite request of the House
– Will the Minister lay them on the table now?
– In fairness to honorable members who are taking part in the tariff debate, will the Prime Minister make it a matter of Government policy to supply them as soon as possible with all the reports made by the Tariff Board?
– The Government^ policy in this regard is being carried out by the Minister for Trade and Customs.’ As the reports become available they are tabled. The Government policy in this respect has been reiterated on a number of occasions. I have noticed, however, that when the Minister has tabled reports he has met with derision from the honorable member.
Quality of Petrol
– I ask the Minister for Trade and Customs if it is possible to make some arrangement with the existing petrol companies with a view to ensuring that a standard quality of petrol will be obtained from kerbside pumps? I had a rather painful experience in Sydney on Friday last. I obtained about 10 gallons from a kerbside pump, and immediately had to empty the petrol on to the pavement because it waa a mixture of turpentine and kerosene. I suggest that steps be taken to require all petrol companies to provide hermetically sealed reservoirs for all kerbside pumps, so that purchasers may have some guarantee of quality.
– I am extremely sorry that the honorable member should have had such an unpleasant experience; but I am sure that he cannot blame the Government for it. Information reached the Government some time ago that the practice of mixing turpentine with petrol had been adopted by certain kerbside pump-owners, and steps were taken to increase the duty on turpentine used for that purpose to an extent that would make it unprofitable for the pump-owners to mix it with petrol, a practice which was depriving the Government of revenue that was badly needed. If the honorable member will give me definite information with regard to his experience, I shall be pleased to take any stops I can to prevent a recurrence of it.
– Will the Minister for Trade and Customs inform me whether a statement attributed to him, which appeared in the press recently, to the effect that the rate of duty on imported pressed steel panels for motor cars would not be interfered with, was authoritative and correct?
– I have made no official statement on the subject. Representations have been made by the importers of British motor cars, with the object of securing relief from the present duties. The whole subject has been carefully investigated by the officers of the Tradeand Customs Department, but no definite decision has yet been made. I will refer the matter to Cabinet, and then make an official statement on the subject.
– Will the Prime Minister inform me whether a statement made the other day by the Minister for Health (Mr. McNeill) to the effect that the Government would inevitably have to adopt a policy of inflation, was authoritative and correct?
– I have not seen any statement to that effect.
Reduction of Interest Rates
asked the Treasurer, upon notice -
In view of the success of the conversion loan, is it now intended to give effect to the undertaking of the Government that should such loan be a success the interest rate payable by eligible persons on War Service homes would be reduced; if so, from what date and by what amount will such interest be reduced?
– It is the intention of the Government to reduce the rate of interest on War Service homes from 5 per cent, to 4½ per cent, as from the 1st August, 1933. In fixing the rate of 4½ per cent., allowance has been made for the fact that the Government is bearing the cost of administration.
Benefit of Exchange Rate
asked the Treasurer, upon notice -
In view of replies to questions by the honorable member for Wentworth over two months ago that payments to Imperial pensioners in the Commonwealth would be credited with the ruling rate of exchange, and that the addition would be retrospective -
Is it a fact that this arrangement has not been given effect to; if so, what is the reason for the delay; and
On what date is it anticipated that these additional payments will be made, and to what date will they be made retrospective?
– Arrangements have been completed for making supplementary payments to Imperial pensioners resident in the Commonwealth to cover the difference between the payments already made to them and the equivalent in Australian currency of the sterling payments made to the Commonwealth in London by the British authorities. The first payment will be made immediately. Some of the cheques are being posted to-day. The payments will be retrospective, the payment now being made covering the period 1st January, 1930, to 31st March, 1931. A further payment covering the six months ended 30th September, 1933, will be made in October. Subsequent payments will be made half-yearly in April ‘and October of each year.
Appointment of Assessors
– The honorable member for Wentworth (Mr. Marks) has asked a series of questions regarding the appointment of assessors of the Marine Court. The information is being obtained.
Benefit to Producers
asked the Minister for Markets, upon notice -
– The desired information is being obtained.
asked the Treasurer, upon notice -
– The answers to the honorable member’s questions are as follow : -
This matter has already been fully considered by the Government and was made the subject of a recent amendment of the law which provides that securities may now be of a continuous nature, i.e., it is provided that any security in force when the law was amended shall continue to remain in force until -
The adoption of this scheme will obviate the necessity for the furnishing of fresh securities each year, and will remove the cause for similar complaints in future.
So far as securities for the period ended 30th June, 1931, are concerned, the department will endeavour to give releases as soon as is practicable, having regard to the necessity for protecting the revenue by seeing that the law has been complied with, throughout that period, by the persons concerned.
Installationof Wireless Equipment
asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s questions are as follow : -
asked the Treasurer. upon notice -
– The answers to the honorable member’s questions are as follow : -
with 2s. per week for every dependent child.
The contributions to the fund vary downward from 7d. per week from the employee, id. from the employer, and 7½d. from the Exchequer, in the case of an adult male. These benefits are now reduced by 10 per cent, (adult male from 17s. to 15s. 3d.), except the payment for dependent children, which is unchanged. Contributions have been increased by 10 per sent.
Importation in Containers.
asked the Minister for Trade and Customs, upon notice -
How many gallons of petrol were imported in containers into the Commonwealth during each of the following months, viz.: - January, February, March, April, May, and June, 1931?
– Information is being obtained.
asked the PostmasterGeneral, upon notice-
Will he state when it is intended to apply the five-day working weekto the engineers’ branch of the Postal Department, including linemen and assistants, in the Bendigo district ?
– The five-day week was introduced in the engineering branch of the department at the outset, so far as it could be safely applied without detriment to the rendering of public services. As the result of experience arrangements have already been made for a further extension so far as is practicable at the moment, including the engineer’s district at Bendigo. The scheme is under continued review in the hope that it may be found possible to make still further extensions, but necessarily great care must be exercised to obviate interference with the services.
Reduction of Salaries
asked the AttorneyGeneral, upon notice -
– The answers to the honorable member’s questions are as follow : - 1 and 2. High Court. - (a) Three of the justices have each agreed to pay the sum of £750 into the Commonwealth Revenue Fund; (b) three of the justices have agreed to forego travelling allowance. The amount saved cannot be definitely stated, but depends on the extent to which the duties of the justices will require them to travel. Commonwealth Court of Conciliation and Arbitration. - Two judges have agreed to transfer to the Commonwealth for two years the 25 per cent, of the amount of their salaries, i.e., £750 per annum in one case and £625 per annum in the other. No intimation as to the intentions of the remaining judge has up to the present been received. Federal Court of Bankruptcy. - The judge has intimated that for reasons stated he cannot accede to the suggestion made by the Government that it is desirable and appropriate that the justices should give authority for deductions to be made from their salaries on the basis of reductions proposed in the Financial Emergency Bill. No offer of a reduction of traveiling allowance has been received from the judge.
asked the Prime Minister, upon notice -
What action has been taken by the State Governments to pass legislation for the purpose of reducing interest on private mortgages ?
– The position as reported to the conference of Commonwealth and State Ministers early last, week was as follows: -
New South Wales - Bill not yet submitted.
Victoria - Bill introduced tor reduction of interest on mortgages by 22) per cent. with a minimum rate of 5 per cent, per annum. Mortgagors to apply to court failing agreement between mortgagor and mortgagee. Bill generally follows lines of draft bil! prepared at Premiers Conference.
Queensland - Financial Emergency Act 1081 provides for reduction of 22-i per cent, in interest rates on all mortgages, with a minimum rate of 5 per cent, per annum. Mortgagor to apply to court failing agreement between mortgagor and mortgagee. Act generally follows lines of draft bill prepared at Premiers Conference.
South Australia - Financial Emergency Act 1931 provides for reduction of interest on all mortgages by 221 per cent., provided reduction does not reduce rates below a per cent, per annum. Provision is made for mortgagor to apply to court for relief, failing agreement between mortgagor and mortgagee. Act does not apply to bank mortgages until 1st October, 1931. The act generally follows lines of draft bill prepared at Premiers Conference.
Western Australia - Financial Emergency Act 1931 provides that a mortgagee is entitled to receive 774 per cent, of the rate of interest provided in the mortgage, or 5 per cent, (whichever is the greater). The mortgagee must apply for an order permitting him to charge a higher rate.
Tasmania - Mortgage Interest Reduction Act 1031 provides for the reduction of interest on all mortgages hy 224 per cent., provided that no rate shall be reduced below 5 per cent. The act docs not apply to banks. Reduction is automatic, but the mortgagee may apply to court for exemption from the reduction.
Commission Paid to Banks
asked the Treasurer, upon notice - 1, Was any, and, if so, what, amount of commission or allowance paid to the banks for bonds or scrip converted through them?
– No commission or allowance was paid to banks for bonds or stock converted through them into the recent loan.
asked the Treasurer, upon, notice -
What steps does the Government intend te take in the matter of interest amounting to £28,000,000, due in London before 30th June next? 1
– The Government proposes to remit interest to London from month to month as it falls due. Exchange for this purpose will be secured through the exchange pool established last year.
asked the Treasurer, upon notice -
What reductions (if any) of interest on overdrafts and advances have been made by each of the private banks operating in Australia?
– Varying reductions have been made by the banks from time to time in the rates of interest on overdrafts and advances, and all the banks will have reduced rates by an average of 1 per cent, by the 1st October next.
asked the Minister for Home Affairs, upon notice -
What increase of employment or decrease in unemployment followed the wage reduction under the UG awards of the Arbitration Court between October and December, 1930?
– Information is not available to answer the honorable member’s question. A long and expensive inquiry would be necessary to obtain the information.
Duty and Sales Tax
asked the Minister fer Trade and Customs, upon notice -
What arc the rates of customs duty, primage duty and ‘sales tax respectively on - (o) petrol; (6) kerosene; (c)’ lubricating oil; (ti) lubricating grease; (e) crude oil for use in diesel engines?
– The information is contained in the following schedule : -
Interest on Private Mortgages.
asked the Treasurer, upon notice -
What action docs the Government contemplate regarding the reduction of interest on private mortgages in the Federal Capital Territory?
– Action has already been taken in this matter, vide Ordinance No. 14 of 1931, which was published in the Gazette on the 6tb August last, and which came into operation on the 1st September.
– Has the Prime Minister yet had time to consider the effect of the operation of the new standing order with regard to the asking of questions upon notice and their publication in Hansard? Does the right honorable gentleman consider that one-tenth of the questions asked without notice yesterday and to-day are so urgent that they should be answered at once?
– I have been somewhat indulgent in this regard so far, but if honorable members continue to ask so many questions without notice about matters which are not urgent I shall have to take definite action.
The following papers were presented : -
Bankruptcy Act - Third Annual Report for period 1st August, 1030, to 31st July, 1031.
High Court Procedure Act and Judiciary Act-
Rule of Court - Dated 18th August, 1931.
Rules of Court Amended -Statutory Rules 1931, No. 105.
In Committee of Ways and Means :
Consideration resumed from the 16th September (vide page 51), on motion by Mr. Forde -
That the schedule to the Customs Tariff be amended -
Division 6. - Metals and Machinery
Postponed item 145.
By omitting the whole item and inserting in its stead the following item: - “ 145. Iron and Steel Plate and Sheet, viz. : - Corrugated Galvanized, Galvanized not Corrugated, and. Corrugated not Galvanized per ton, British, 110s.; intermediate, 130s.: general. 150s.”
Upon which Mr. Forde had moved by way of amendment -
That the item be amended by adding the following proviso: - “ Provided that if at any time the Minister notifies in the Gazette that in his opinion the Australian requirements for the goods specified in this item for any period of twelve months after the first day of September, 1931, have exceeded 60,000 tons, the rates of duty on such goods shall, on and from the date of the gazettal be per ton, British, 90s.; intermediate, 110s.; general, 130s.
. -In view of the fact that the galvanized iron industry of Australia is providing employment for so many of our workers at a time when work is hard to get, the Government should take every possible step to afford it reasonable protection. Honorable members opposite seem to cling to the doctrine of the days of Bright and Cobden, forgetting altogether that even the British Government is being forced to-day to seriously consider the advisableness of following the example of Australia and adopting a tariff policy in order to protect the industries of the Mother Country. Seeing that the galvanized iron industry gives more employment per £100 spent than most other industries, it would be very regrettable if the Government were to withhold adequate protection from it. Honorable members opposite,, in accordance with their usual custom, have exaggerated all the points they have endeavoured to make during this debate. They have said, for’ instance,, that our farmers are suffering very severely because of the existing duties on galvanized iron. But the farmers do not live on galvanized iron. I do not suppose that on the average there is more than £20 worth of galvanized iron ona farm. The iron lasts for a very long while - certainly longer than the average lifetime of the farmer. I can remember the time when our dwelling houses and sheds were roofed with. shingles or bark. I can also remember, as a boy, seeing the first galvanized iron roof being put on a house in the district where I lived. If the galvanized iron which was put on roofs as long as 50 years ago were offered for sale to-day, it would probably bring more than it originally cost. Galvanized iron is not a great factor in the farming industry. I do not suppose that it costs the farmers on the average £1 a year, spreading the cost of it over the life of the iron. Honorable members opposite have indulged in a good deal of captious criticism of the Government’s policy in this connexion. But while the last Nationalist Government was in office, motor cars were being imported from America for which our farmers had to pay about £300, though the American farmers could buy them for £60. No complaint was made by honorable members opposite on that score. They did not seem to care what happened so long as the money spent on those cars did not stay in Australia. They would be quite satisfied if our requirements of galvanized iron were imported from Germany, some of which would possibly be manufactured by the same men who produced the poisonous gases which destroyed so many Australian workmen when fighting for this country overseas. Honorable members opposite appear to overlook the fact that a huge sum of money has been expended in developing the Australian iron, aud steel industry, and that a large portion of the money annually paid in wages is spent in purchasing the products of primary producers, whom they appear to be so anxious to assist. It should be the desire of honorable members opposite to develop rather than to destroy the market for primary products. The honorable member for Wimmera (Mr. Stewart) referred to the loss he incurred owing to a wheat stack being destroyed by mice, which he said could have been prevented but for the exorbitant price charged for galvanized iron, which could, have been used to protect it. Although £10 worth- of galvanized iron would have been sufficient to protect his wheat, apparently the honorable member had been so improvident that he could not afford to pay that amount. Galvanized iron has such lasting qualities thai it could be handed down from generation to generation, and consequently the annual expenditure reduced to a very small amount.
– Why not use cats to destroy mice?
– By that interjection I am reminded of the initiative of a farmer in Forrest, in Western Australia, who, when mice were destroying his wheat, commenced breeding cats, which eventually destroyed all the mice. He then continued to breed cats, which were killed and the skins exported at a profitable price. To feed the cats he started a rat farm, the cats eating the rats and the rats living on the carcases of the cats. The rate of wages for skinning by Australians was threatened by the importation of Southern Europeans, whom this Government, on assuming office, prevented from coming to Australia. The farmer then endeavoured to cross cats with carpet snakes, so that they would shed their own skins and thus save the cost of skinning. The honorable member for Angas (Mr. Gabb), the high priest and mugurimp of the political Pharisees on the other side of the House, who de livered a lecture concerning tia» disadvantages which he alleges are being experienced by primary producers, apparently overlooks the claims of those engaged in the iron and steel industry. I am pleased to learn that the manufacturers of this commodity, who are good employers, do not intend to approach the Arbitration Court for a reduction in the wages of their employees. If foreign galvanized iron is extensively used in Australia, we cannot tax the makers; but when its manufacture is undertaken in Australia those receiving the benefit of our protective policy are compelled to contribute to the Commonwealth revenue. The right honorable the Prime Minister (Mr. Scullin) mentioned to-day the efforts which the Government is making to relieve unemployment, in order to reduce the number of deserving men receiving the dole. Unfortunately, the farmers of this country have been imposed upon by honorable members opposite, who profess to be their friends, and support the policy of a newspaper entitled Land. These gentlemen have made the farmers the victims of the wheat merchants and other such parasites, who provide the funds to assist them politically. Although galvanized iron is not manufactured in my electorate, I intend to support this duty, particularly when I find that our political friends in Great Britain are beginning to realize the necessity of adopting a fiscal policy such as has been in operation in Australia for some time. I have every sympathy with the farmers, and intend to help them all I can. I do not think that the proposed duty on galvanized iron will penalize them in any way. A Labour Government in New South Wales spent £3,000,000 to establish a bulk wheathandling system. This Labour Government has also made numerous attempts to assist the wheat-growers, but honorable members opposite, who profess to be so solicitous for the welfare of the farmers, have strenuously opposed any efforts which this Government has made on their behalf. I am pleased to learn that it is now proposed to pay an export bounty of 6d. a bushel on the next year’s crop, which will be of some assistance in enabling Australian wheat-growers to dispose of their product in competition with other countries. I have no doubt that the
Opposition will vote against the Government’s proposal because its members have no desire to see good wages paid in this country. The Labour party, being altruistic in its outlook, is not concerned about votes so long as the best interests of Australia are served. The spirit of the Labour movement is such that its supporters are prepared to perish in the attempt to put their country first. I shall support the Minister, regardless of consequences,
.- The honorable member for Eden-Monaro (Mr. Cusack) has been whistling to keep up his courage. He said that members of the Labour party would put Australia first, even though it meant that they perished in the attempt. I have no doubt that at the next election the honorable member and his associates will perish politically because they put themselves first.
I rise to oppose the proposal of the Government, and to indicate that I shall support the amendment foreshadowed by the honorable member for Gippsland ( Mr. Paterson) - an amendment based on the report of the Tariff Board. I shall oppose the Government’s proposal for three reasons : first, because it strikes a blow at Australian primary industries, and also the building trade; secondly, because it will adversely affect reciprocal trade with Great Britain at a time when we should do our utmost to develop that trade, seeing that Great Britain is passing through such a critical period; and thirdly, because it is a deliberate attempt to take the control of the country’s fiscal policy from the Parliament of the Commonwealth. The Government’s proposal is practically to hand over the control of Australia’s fiscal policy to the Government of New South Wales. The Minister was good enough to supply me with a copy of the statement he made yesterday. Having studied that statement, it appears to me that these duties have been proposed because labour conditions in New South Wales are such that the cost of producing bar steel cannot be reduced. The Minister admits that because labour conditions in New South Wales do not conform to the standard which obtains in the rest of Australia it is necessary to impose higher duties on galvanized iron in order to keep the gal vanized iron-making industry going. It is worth noting that the higher the duties imposed on imported galvanized iron, ostensibly with a view to assisting the Australian industry, the greater the damage done to the workers employed, not only in that industry, but also in other industries. Some time ago, with the object of giving the whole of the trade in galvanized iron to the Australian company, an embargo was placed on the importation of that commodity. Immediately the price of galvanized iron rose. Later, heavy duties on galvanized iron were substituted for the embargo. The result has been that, compared with a consumption of about 110,000 tons of galvanized iron a year before the imposition of the duties, and an anticipated production in Australia of 80,000 tons per annum, as a result of duties, the Australian company is now manufacturing and selling only between 25,000 and 30,000 tons per annum. The fall in the consumption of galvanized iron in Australia is not due to any falling off in the demand for that commodity. As pointed out yesterday by the honorable member for Wakefield (Mr. Hawker), there are many thousands of persons throughout Australia keenly desirous of obtaining galvanized iron, who are unable to purchase it because the cost is so high. In many cases they are keenly buying second-hand material. Instead of assisting the industry, the imposition of high duties has injured it, because it has lessened the purchasing power of the people.
– The falling off in the consumption of galvanized iron ‘is due to the economic depression.
– The economic depression is responsible to some extent for the falling off; but I shall show from my own experience that that is not the only cause. Recently, I required about !£ tons of galvanized iron, but, because the price had risen from £24 10s. to £30 a ton, I was unable to purchase it. Instead, I pulled down sheds and erected them elsewhere 200 miles away. Similar things are being done in many places throughout Australia. Where old iron cannot be obtained, farmers are using the bark of trees to cover buildings and sheds. The policy of imposing high duties on galvanized iron has injured, rather than helped, the industry. I feel confident that, if the price of galvanized iron were reduced to bring it within the reach of those requiring it, most of the difficulties which now exist in the industry would disappear. When a bounty was paid on the production of galvanized iron that commodity was cheaper than it is now. Its lower price then placed the material within the reach of those requiring it. If we are to rehabilitate the galvanized iron-making industry we must bring down the price. The Government’s proposal wil] tend to increase the price, and, therefore, to injure the industry still further.
The statement read by the Minister yesterday amazed me, because it indicates that the Government has practically capitulated to Mr. Lang. Evidently, the Government is not prepared to do anything to bring labour conditions in New South Wales into conformity with the conditions in the other States. While in the rest of Australia a 48-hour week is the rule, and federal arbitration awards apply, New South Wales insists on a 44-hour week and its own labour conditions. The time has come for u3 to decide whether the Commonwealth Parliament or the Parliament of a State is to control Australia’s fiscal policy. Should Lysaght Limited or the Broken, Hill Proprietary Limited close their works that unfortunate result will be due to the application of New South Wales labour conditions to those industries. The Minister says that the price of galvanized iron cannot be reduced because of the present high prices of bar iron and zinc. Australia possesses some of the richest iron deposits in the world, so rich and well placed that we are able to export iron ores profitably to Japan, the United States of America, and European countries. Australia also has valuable coal deposits. We are able to mine and export coal. Both of these requirements for the manufacture of iron and steel are obtainable close to navigable waters, and are thus able to he brought together with greater ease and less cost probably than in any other part of the world. Yet what is the position? We bring these two minerals together and put them through the mills. This is almost entirely a mechanical process, and the finished product in the form of pig iron costs £6 5s. a ton, while pig iron produced in England probably from Australian iron ore costs only £3 5s. a ton. As a result of that stupid position our industries, which depend on those basic minerals, are greatly handicapped. Bar sheet is selling in Australia at £9 16s. a ton. The Tariff Board considers that £8 lis. 3d. a ton is a reasonable price, yet the European export price is about £3 6s. a ton. Zinc is used to manufacture bar sheet into galvanized iron. The zinc is mined, produced, and electrolyzed in Australia. A great quantity is sold overseas, yet, because of our stupid policy, the Australian manufacturer has to pay about £2 10s. a ton more than his competitor in Great Britain pays for the self-same zinc. That is another great handicap that we have placed upon our manufacturers. It is obvious that we must revert to fundamental principles t» bring about a reduction of costs. Th« Minister himself suggested that this was not a proper duty to impose, because so soon as the output of the Newcastle mills reaches 60,000 tons he is willing to reduce the duty, and, iti fact, he has moved an amendment to that effect. How can we possibly bring about an increase of production in the Newcastle mills? The increased duty and the embargo have not brought it about. The only time when the Newcastle mills were busy, despite the fact that thousands of tons of iron and steel products were being imported into this country, was when the bounty system operated in Australia, and iron was comparatively cheap. We must revert to that system. In the Tariff Board’s report there is no reference to a bounty on galvanized iron. The board pointed out that the encouragement of the establishment of the galvanized iron industry by means of a bounty was not referred to it, and that, consequently, it disregarded that question altogether.
– The board said that it preferred the bounty system.
– I do not know whether the board, actually said that, but undoubtedly it did not investigate that matter because it was not submitted to it. When the Tariff Board’s report is being considered, that point must not be forgotten. There are many cogent reasons why, despite the proposals hefore the committee, and the report of the Tariff Board which explicitly states that the question of a bounty’ was not considered, we should protect and encourage this industry with a bounty rather than with a duty. There are many reasons for that. The first is that the Australian industry does not, at present, supply the whole of the Australian requirements. The Minister has said that when the industry is in a position to produce 60,000 tons of galvanized iron annually, it will not require the high duty that is now proposed. I understood, when the embargo was imposed, that the industry was able to produce 80,000 tons of galvanized iron annually.
– That was so, but there was no demand for that quantity.
– If the Minister’s statement that the industry is not in a position to produce immediately 60,000 tons of galvanized iron annually, is true, I cannot understand why the bounty system should have been superseded by a duty or an embargo.
– The industry was able to produce 80,000 tons annually, but there was no demand for that quantity. The demand is at present for only 30,000 tons annually.
– The demand has decreased because of the high prices ruling for galvanized iron.
– The main cause of the diminished demand is the serious depres81011 and the fact that all governments have had to shut, down on loan expenditure.
– The Minister talks as if the Government were large purchasers of galvanized iron, but the biggest purchasers are private people. I certainly disagree with , the Minister’s statement that only 25 per cent, of our galvanized iron production is used in the country.
– - -I said that 25 per cent, was used by the primary producers.
– The Minister must know that most country buildings are roofed with galvanized iron while practically every city building is roofed with tiles or slates. The man who works on a farm is a primary producer as well as the actual farmer, and surely he is entitled to some consideration. The Minister’s own statement should induct all members of the Labour party to ra 11’ beside honorable members on this side in an endeavour to remove this iniquitous duty, because it must affect their con- .stituencies in the same way as it doescountry constituencies. The second reason why this duty should be removed is that the industry has a monopoly, and it seems to me that there should be some competition, if not in Australia, then from elsewhere. The only competition, apparently, that we can obtain is from inside the Empire, and surely we should not object to that. Because of the high duty, exchange and primage duties, th,importation of galvanized iron at present is practically prohibited and there is neither external nor internal competition. The third reason why I think that a bounty should supersede the duty is that the exact amount of the bounty would be shown in the yearly accounts of the Government, and every person in Australia would b, able by picking up the Commonwealth Year-Book to ascertain the charge imposed upon the people in order to afford protection to this industry. At present we d« not know what we are paying for its protection. The Minister read a long state ment relating to the cost of the duty, but various members on this side of the chamber consider that the cost is much greater than stated by the Minister. There is a difference of opinion regard ing the exact cost of the duty, but if the bounty system were introduced we would know clearly and definitely to what extent we were protecting the galvanized iron industry. Another reason why there should be a bounty instead of a duty is that the cost of the industry would thereby be spread equitably over the entire tax-paying community, and not placed entirely on the shoulders of onesection. That surely is not an unreasonable proposal at this particular time, when the cry of the Government is “ equality of sacrifice “. The Minister says that with regard to everything but galvanized iron there shall be equality of sacrifice, but that the man who requires that commodity must pay through the nose for it, and if he cannot afford to do that, he must do without it. If the cost of galvanized iron could be cheapened by the payment of a bounty instead of the imposition of a duty, the cost of production in vital industries generally in this country would be reduced, and some real contribution would be made to the plan of financial and economic rehabilitation. lt is obvious that Australia cannot make any progress unless that cost of production is reduced. That is one of the first steps that must be taken;, and one of the principal essentials is to reduce the cost of equipping our industries. Factories in the cities, and farm houses, barns, and sheds all over Australia, have to be covered with galvanized iron. If the cost of that commodity is excessive, many of those structures will not be erected, and the rehabilitation of this country will be definitely impeded. The Tariff Board wa3 not requested to report on the question whether there should be a bounty rather than a duty; but I ask the committee to insist upon being given an opportunity to determine that matter.
Let us examine the duty recommended by the Tariff Board so as to ascertain why the Minister has differed from the Tariff Board as to what is necessary to support the industry. The board has reported that, if the exchange rate should rise above 28 per cent. - it is now 81-& per cent. - the duty should bc free British, 20 per cent, intermediate, and 40 per cent, general. The Minister disagrees with that recommendation, and proposes a higher duty. I contend that his rates are altogether too high, with exchange where it stands to-day. Surely the conditions in Australia generally should be considered in relation to the requirements of this industry! We should not simply confine our attention to the charges that are imposed by the laws of the State of New South Wales. The Tariff Board points out that a 10 per cent, reduction in the basic wage has been made by the Federal Arbitration Court. That reduction represents 15s. 6d. a ton, which brings down to £23 lis. lid. the price at which this commodity should be sold. But, generally throughout Australia, there has not only been a 10 per cent, reduction of the basic wage, but also a further 13 per cent, reduction due to the lowering of the cost of living, principally on butter, eggs, and other farm products. Consequently, there has been a 23 per cent, reduction in the cost of wages, and that is reflected in all awards of the Federal Arbitration Court.
– The right honorable gentleman has complained of the cost of living having been increased.
– My complaint isthat the cost of manufactured goods hu* increased in this country. The other day, in a store at Bathurst, the manager showed me a number of manufactured1 articles which, he informed me, were costing 20 per cent, more to invoice-this year than they cost last year; yet, the income of every person in that community has been reduced by anything from 20 per cent, to 100 per cent. He said to me, “ How can I sell these goods when that is the position ? “ How can galvanized iron be sold at an additional cost of £6 a ton when the income of every person who uses it has declined? The rates suggested by the Tariff Board are really excessive in view of the general condition of Australia. We should concern ourselves, not with the conditions that are imposed in the State of New South Wales, but with what is the general average throughout Australia. That, surely, is the test which should be applied. Our tariff should operate in such a way as to give to those industries which are paying these wages a reasonable chance of working on a profitable basis. Why should we stand behind one State which says that it will not come into the general scheme? New South Wales remained aloof from the general governmental financial proposals until the last minute, when it was dragged in by the hair by the Federal Government. It* has stood out of every other scheme, to the detriment of not only hundreds of thousands of workers, but also the community generally throughout Australia. Who are we that we should perpetuate that state of affairs? The Commonwealth must insist upon being the supreme fiscal authority, and disregard any such extraneous conditions that may be operating. Coal prices have been reduced by 6s. a ton. which should mean a reduction roughly, of 15s. a ton in the co3t of iron and steel and, consequently, of galvanized iron. Lastly, there is the fact that the primage duty has been raised to 10 per cent., which means that an additional 10 per cent, protection is being given to the locallymanufactured article.
– lt is equal to £1 a ton above the amount set out by the Tariff Board when the primage was 4 per cent.
– On an overseas price of £15 a ton it amounts to roughly £1 13s. a ton. That practically offsets all the other charges that the Minister has mentioned. The honorable gentleman has argued that we should make certain that this industry is profitable to its promoters. “Who are we that we should make certain by legislation that any industry in this country is maintained on a profitable basis instead of by competent management?
– I did not say that we should make certain ; what I said was that any person who put money into an industry of this description had reason to expect a fair return.
– No person has any reason to expect that the Government of this country will bolster up one industry at the expense of all others, and enable it to be the only industry that is making a profit, whether its turnover be large or small. Such a position is ridiculous, especially at this particular time, when hundreds of pastoralists and thousands of farmers are unable to make a living, and the wheat-farmers are in the state described yesterday by the honorable member for Angas (Mr. Gabb). The Minister contends that a return of 4,8 per cent, is reasonable, despite the fact that the galvanized iron industry in many other countries has lost half of its capital as the result of the world depression during the last two or three years. It would appear that this particular industry in Australia is to be sacrosanct, that it is to be the only industry that we should make certain will have a profitable existence whether its turnover be big or small. It could be made profitable if its turnover were made a big one. A turnover of from 40,000 tons to 50,000 tons per annum could be obtained by reducing the price to what the Tariff Board says ought to prove a profitable one.
– We want to increase ite output.
– That can bc done only by lowering the price. That is a maxim of commerce. The raising of prices is a governmental maxim. It is in operation on the railways, where freight* and fares have been increased to the detriment of the revenue. We increase tax: tion, and the income obtained from thai source declines, because the law of diminishing returns operates. That iwhat is happening in this case. The only way in which the position can be im proved is by lowering the cost. Therefore. 1 say that the proposal before the committee is not one that can be supported If it. be agreed to, the rate for the futureWill be practically £6 a ton more than ir was last year or the year before, when thi prices of wool, wheat and butter were a> least 40 per cent, or 50 per cent, higher than they are to-day. When those peoplewho use this commodity have lost thegreater part of their income, is noi the time to raise the price. The Minister’s contention that 75 per cent, of the production of these factories is used in the cities may be correct; but that doe.not destroy my argument, because the income of practically everybody in the cities has fallen. Building will not be stimu-lated by increasing- the duties on basic materials, thus forcing up wages and other costs, and consequently limiting finoutput of secondary manufacturers who use those basic “materials, and bringing into being the vicious circle’ of continually increasing prices. That will only get w deeper into difficulties. It is useless to tell starving farmers that galvanized iron represents only a fraction of a penny of the cost of their production, and that tinprice of £29 10s. a ton can bc amortized in 30 years. If the iron lasted 1,000 years, it would be useless to them if they had not the money with which to buy ii. Lysaght Limited will not supply it with out payment, or even for a lien over thi crops.
The CHAIRMAN (Mr. McGrath).Order ! The right honorable member’. - time has expired. [Quorum formed.’]
.- Thiduties on galvanized iron are essentially related to the iron and steel industry as a whole, and affect the interests of the users in the cities and the country. The iron and steel industry is important in respect of national defence and national industry, and I arn prepared to protect it. It is essential that with the world constituted as it is at present we should not be dependent upon other countries for our supplies of iron and steel. If Ave acknowledge that principle, wo must consider the position of those products into which iron and steel are manufactured. It is important to take into account the present state of thu iron and steel trade throughout the world. It is in the fullest sense a world trade. Iron and steel are exported by nearly all the producing countries. The manner in which the great European enterprises carry on their business is illuminating, and I quote from the British Mining Journal the following prices ruling in Germany in December last : -
I could cite other metal products to show that there is a marked difference, sometimes up to 100 per cent., between domestic and export prices. On this account, the British steel industry is in a difficult position. For example, on the 23rd July last, the price of British joists in England was £8 ,15s., and of continental joists, £4 9s. : British bars, £6 12s. Gd.; continental, £4 10s. 6d. : British angles, £8 7s. 6d. ; continental, £4 10s.: British plates, £9 7s. 6d. ; and continental, £5 ls. 3d. Having regard to the dumping which obviously takes place, I am not prepared to expose the Australian iron and steel industry to the risks which would be involved in a failure to give to it reasonable protection. We have to consider also in relation to this and other industries, the effect of Russia’s re-entry into world trade, and its urgent desire to obtain external credits. While Russia was out of the international markets, other countries increased their manufacturing plant and acreage under crop in order to cater for that portion of the demand which hitherto Russia had supplied. With the re-entry of that country into the market, many products are oversupplied. In these circumstances, what is to be Australia’s policy? I propose to suggest a new line of approach to the problem, or at least a line which I have not heard indicated in this debate, and which I fear will be unpopular in some quarters. The Australian company which manufactures galvanized iron is reported to be efficient, well equipped, and capable of producing 80,000 tons per annum, of which the company can sell in Australia only 30,000 tons, and outside Australia, nothing, because the cost of production is so high as to prevent it from competing in the markets of the world. There is no chance in the immediate future of this plant being utilized to full capacity if it is confined to supplying the Australian market. Hundreds of thousands of pounds have been invested in the plant, and capital and men are idle. Extending this survey to the iron and steel industry as a whole, we find the Broken Hill Proprietary Company, of which I, as an Australian, am proud, and the Australian Iron and Steel Company with which I am not so familiar, capable of producing iron and steel in quantities which this country is not likely to be able to utilize in the immediate future. These companies are working to less than one-third capacity. This means a great: waste of capital and labour. The equipment is ready to be used, and thousands of men are out of work; yet the two cannot function because, in the only market now regarded as available for this industry, the product is not wanted at present prices. The object of the proposal to increase certain duties is to exclude galvanized iron produced in other countries and give to the Australian manufacturer a chance to keep up his prices. The Government holds that under existing conditions the manufacturer must be able to obtain prices higher than would be obtainable in a freetrade market. But the keeping up of prices tends in itself to aggravate the evils of the present position. It tends to reduce consumption still further, particularly in a time of depression. Accordingly we are confronted with a problem which appears insoluble. There is waste of capital and of man power, however we regard the industry. It is futile now to complain of the expansion of plants beyond the capacity of the market to absorb the product. We have to deal with the facts as they are, and as they are likely to be in the immediate future. The position is fundamentally uneconomic, and we cannot, particularly in a time of depression, put on ;a sound basis, industries which are overequipped for the Australian market, by merely imposing protective duties. Oan this problem be attacked from any other angle? Lysaght Limited have the whole of the Australian market. If prices are maintained at their present level an expansion of consumption is unlikely.
– A further contraction is probable.
– I am afraid of that, especially if existing prices be maintained and world conditions become worse. The Australian market cannot employ the idle capital and nien unless prices are substantially reduced. Can we develop an export trade? That proposal may sound ridiculous; but we have to look for a solution, and unless we open up new avenues which at first may not find favour with some sections of the community, we shall not be able to evolve a plan that offers any hope of relief from our industrial difficulties.
I began by pointing out what Germany was doing, and also said something about the position in Russia. All countries in the world which have large industries are producing goods for consumption at home, and also for export, disposing of the latter at lower prices than those charged to their own people.
– Is not the internal economic position of Russia much different from that of other countries?
– Very different indeed. Russia is exporting in order to get plant and trade credits, almost irrespective of the cost of production. She is forced into doing so in order to carry out the present policy of the country. We are in a world where that sort of thing is being done, and we must do a bit of it ourselves. Speaking generally, it, is being done in our primary industries, which are selling quite a number of their products at comparatively high prices locally, and exporting the balance for what can be obtained on the markets of the world, the industry evening up the proceeds over the output as a whole. It is a very difficult problem to work out practically and successfully. But in the case of our secondary industries, we in Australia appear to have resigned ourselves to supplying only the home market. Yet in many industries it Ls extremely difficult to have effective production on a sufficient scale if we confine ourselves to the local market. Therefore, I raise the question - and I know that I shall have to say a lot more than I have said upon it in order to get down to realities - as to the possibility of export in our Australian secondary industries. We should aim at bringing about a production that will make use at least of existing plant and get down to a basis of efficiency. When I say “ efficiency “ I am not animadverting upon the efficiency of enterprises as at present conducted, but I understand that the Broken Hill Proprietary Limited works at Newcastle are operating at something less than one-
I hird of their capacity at the present time. That is what we want to alter if we can, and it appears to me to be quite impossible to do so while the activities of that company and Australian Iron and Steel Limited are confined to the Australian market.
– Is it not a fact that the United States of America has reached a high stage of scientific production in its secondary industries, and yet has 6,000,000 unemployed to-day?
– If the honorable member desired me to discuss the United States of America, I should have to deal with many considerations beyond those already mentioned. We in Australia must enter into world competition or resign ourselves to becoming a backward nation. That is the alternative that I am wishful to avoid. Our action must be taken with due regard to existing world economicconditions. I hope that something may bc done to bring about a change in those conditions. Honorable members, of course, have their own ideas how it can be done.
We are very close to markets for our iron and steel products. There is a useful market in New Zealand, and a big one in the East. I suggest that steps should be taken to ascertain the conditions upon which it would be possible for our iron and steel industry to export its products to these markets and obtain .a fair share of the trade which, I understand, amounts in the East to millions of pounds per annum. I would not presume to say in detail what those conditions are. Some things, however, are obvious. I can understand that with a great capital expenditure of millions of pounds, as is the case of the Broken Hill Proprietary Limited at Newcastle, and a plant working at only one-third of its capacity, overhead becomes a gigantic charge upon the industry. It may be- that merely by working to full capacity and having a market for the output the reduction of overhead, spread over the whole production, would make it possible to sell a substantial proportion of the articles at much lower rates than are possible at present. Some industries - and for the moment I go beyond iron and steel, because that is not an industry that uses as raw material any substantial proportion of imported products- work up imported material. I shall be quite prepared to examine sympathetically any scheme for admitting duty free any such material - provided that it was to be put into goods that were to be exported, or to machinery for working it up.
Then I come to the vexed question of. wages and industrial conditions, about which, perhaps, there will be a great deal of difficulty and doubt. Is it not worth considering a modification of wages and industrial conditions, to enable us to bring some of our secondary industries into exportable production? Would it not be better, both economically, and from the point of view of the effect on the character of our citizens as a whole, to have our people working for something less than existing rates, in order to build up an export trade, rather than to have a developing system of sustenance and doles which I, and I am sure honorable members in every part of the chamber must feel, may lead to a permanent problem of unemployment? Already our primary industries have to take world prices for a proportion of their output. Why should not consideration be given to our secondary industries extending their production, employing many who are now out of work, and accepting world prices for the quota that is not disposed of locally!’ That would involve an examina tion of details, industry by industry. I do not stand here as an expert in a particular industry, and say that this should be done in that industry, and something else in another, but I do say that the proposed increased duty on galvanized iron raises considerations of this character to which it is worth while members of the committee at least giving their earnest attention. That is as far as I shall go.
I shall say very little on this particular duty. Galvanized iron is used extensively in the cities of Australia. This is not merely a country problem. The price of galvanized iron is a very important factor in both city and country. Unfortunately, as matters are in Australia to-day, the consumption of this commodity is falling off; the price is higher than many people are able to pay. The other day a deputation from the building trade waited upon me in Melbourne, and informed me that, as compared with conditions that existed two years ago, the amount of building . being done in Melbourne, and within a 10-mile radius of the city, was. down by 85 per cent. The members of the deputation gave many reasons for that. Of course, they were builders, and ‘wanted to see as much building done at as cheap a price as possible. Among other things they spoke of the prices that were maintained for both galvanized iron and timber. I am aware that the subject of timber will come up later under another item, and I shall deal with it only in passing. They told me that, because some of the timber that they’ had to use wasexpensive, substitutes were coming in rapidly, even for the small balance of building now being done. Galvanized iron and any other commodity needed extensively for building are very important requirements in the city as well as in the country.
I have just been in South Australia, and there I met a large number of farmers, who were receiving at sidings from between ls. 5d. and ls. 7£d. a bushel for their wheat. Practically every one of those farmers had had to spend about 3s. to produce each bushel of wheat that he . was selling. The conditions in the towns we know. It seems to me that we have to consider the position of the galvanized iron industry in the light of the wellknown and all too unfortunate facts with which we are so familiar.
I call attention to the natural desire of John Lysaght Australia Limited to obtain a return on a certain £500,000 at which they value their patents, processes, trade marks, and goodwill. Of course, it will be very nice if they can get it. The proper amount of capital for the company may be £100,000, £500,000, or £750,000. “We cannot tell. But we in this committee cannot accept that valuation of £500,000 as a matter of course, and say that the company is entitled to a return upon it. We have no means here of judging whether there is over-capitalization or not.
One other matter which is obvious upon the face of the report is this: I think that it was the honorable member for Werriwa (Mr. Lazzarini) who complained in very definite language of the Tariff Board calling attention in its report to rates of wages, and who said that such matters were entirely beyond its function. I completely disagree. I think that the honorable member also said that be would not vote for the proposed increase of duty unless the Minister gave an undertaking that, if any application were made for a reduction in wages, there would be a corresponding reduction in the rate of duty. The rates of wages paid in the industry are referred to at page 30 of the report as follows: -
The average wage for a full week’s work in the production of sheet bars for galvanized iron manufacturing is £511s. 2d. The average wage for full-time employment in the galvanized iron industry itself is £6 9s.1d. At present the employees in this industry are working part time and their average earnings are much lower. Whilst this is an equitable method of distributing the wages available, it fails to effect any savings in actual costs of production.
Wage rates are important in relation to costs of production. Of course, the manufacturer cannot do anything but pay the prescribed rate. This afternoon we heard that the Public Service as a whole has suffered a wage reduction of 20 per cent. There has not been even a 10 per cent, reduction in the wages paid to employees in the galvanized iron industry.
Mr.Culley. - The conditions are different.
– In Australia, at the present time, almost everybody has had to accept some reduction of income. Many of the farmers have had no wages at all during the past year-
– Many workers in Australia have had no wages for three years past.
-That is partly because they are prevented from earning wages through the imposition of impossible working conditions. The attempt to maintain rates of wages which cannot be paid under present economic conditions is doing the gravest injury to the workers of Australia, and to all other sections of the community. It would be very nice if everybody could be paid £10 a week, and for £10 to be worth as much as it ever was, but it cannot be done. If it were provided in the Arbitration Court awards to-morrow that everybody should receive £10 a week, that would lead to the swift, and certain ruin of the country.
– Well, let us have £7 a week.
– Some of the coalminers are doing very well at the present time; they are earning magnificent money. I am amazed that the Miners Federation should stand by. and see a few men earn excessive wages, while many others earn nothing at all. I know that it is hard for us to accept reductions; but let our standards be real standards. I am afraid that many in Australia are living in an atmosphere of hypocrisy. There is a pretence that standards are being maintained, when, according to the latest figures, 27.6 per cent, of our trade unionists are unemployed. We are not doing our people any real service by pretending to maintain artificial standards. We are merely putting up costs and prices, making money worth less, and aggravating the hardships of the situation. I do not see why this Parliament should be forced to pass certain tariff legislation because a particular State in which an industry is established happens to insist on certain industrial regulations, and chooses to keep in operation certain social legislation. New South Wales has imposed working conditions which are, from an economic point of view, quite impossible. What with child endowment, workers’ compensation, the 44-hour week, and a basic wage out of relation, as it is, to economic facts, it is impossible to carry on industries in New South Wales on an economic basis. Why should this Parliament be forced into granting increased duties because Mr. Lang chooses to preserve the basic wage in New South Wales at £4 2s. 6d. a week, when the basic wage in the other States is more nearly £3 a week ? Not only does he insist upon the higher wage,- but it must be paid for a working week of only 44 hours. Are we to shape our tariff at the dictation of a particular State Parliament? We should repudiate any such suggestion. The Commonwealth Parliament cannot indefinitely support a State which is failing to take the action necessary in the interests of the workers, and of every other class of citizen. I am not prepared to consider this subject on the assumption that the wage rates paid in the iron and steel industry are permanently fixed at present rates. The workers in the industry ought to share in the reductions which practically everybody else in the community has had to accept. If they were to do that, it would be possible to reduce the price of the product, extend its consumption, and employ more men. I support the proposal of the Tariff Board. It appears to me to be a wellreasoned proposal, and I entirely agree with the honorable member for Fremantle (Mr. Curtin) that, having regard to the rate of exchange, primage duty, &c, the present position of the industry is not duc to overseas competition, but to the existing economic conditions within the Commonwealth. Accordingly, the objects to be sought are increased production and increased sales. There can be increased production only if sales are increased, and this cannot be done unless prices come down. Some honorable members may regard as impracticable my suggestion that there should be applied to this and other industries special conditions to enable it to develop an export trade; but, in my opinion, the suggestion is at least worth exploring.
– The Deputy Leader of the Opposition (Mr. Latham) has argued that it is necessary to develop our export trade in order to relieve the existing depression. To do this, he said, we must reduce the costs of production, and this, he seemed to think, could best be done by reducing wages and making working conditions worse. But if our difficulties could be removed merely by reducing wages, why is it that troubles similar to those which afflict Australia exist to-day in the various lowwage countries of the world? Even honorable members opposite cannot complain that wage3 in Japan, for instance, are too high; yet that country is feeling the trade depression in common with ourselves. Japan has developed her secondary industries to such an extent that she has become a serious competitor with other manufacturing countries, yet she- is experiencing the same difficulty, in spite of low wages, as they are in finding markets for her products. China is not so highly developed industrially as Japan, but that country, although wages there are low, and conditions bad, has not escaped the general depression. The general survey of the world’s economic conditions must convince us that all countries are at present suffering, and that no solution of our own problem could be found by depressing our standards to those of the low-wage countries, even if such a course were not entirely foreign to Australian sentiment.
– In Japan £1 will buy twelve times as much as in Australia.
– That is no answer to my argument. When Australians travel ‘abroad, they feel proud that they are citizens of a country which, has made certain definite improvements in the social conditions enjoyed by its people, and they are able to draw favorable comparisons between their own country and those which they visit. One of the most important tasks of the League of Nations is that of bringing the backward, lowwage countries up to the standards enjoyed by the more advanced nations. This work is regarded as having a direct and important bearing upon the peace of the world. If this is not so, why have this and previous governments sent representatives from Australia to conferences held under the direction of the League of Nations? The leaders of political thought in this country should, if they love their country, as some of them so often profess in public to do, direct their efforts toward improving our existing social standards rather than to depressing them.
Dealing with the subject of export trade, the Deputy Leader of the Opposition (Mr. Latham) referred to the part played by Russia in world affairs to-day. It cannot be denied that that country is playing an increasingly important part. Professor Wadham, of the Melbourne University, recently delivered a very interesting address in Brisbane on this subject to the members of the Constitutional Club. He said that the world could no longer, in the manner of the ostrich, afford to ignore Russia as it had been trying to do, trusting to a political collapse in that country. It was necessary, he said, to recognize that Russia was playing an important role in world affairs. When the Deputy Leader of the Opposition was speaking just now, I interjected that the internal economic conditions in Russia were entirely different from those which obtained in capitalistic countries. In Russia the Government has adopted the course of refusing to recognize public debts, either internal or external. Thus Russia is relieved of the burden of paying interest on such debts, whereas other countries have to find enormous sums in taxation every year for this purpose. This has a most important bearing upon costs of production, and the price at which products can be sold. In this country increased taxation is imposed in each successive budget for the purpose of meeting the interest payments” on our debts. I agree that the burden falls, to a large extent, upon the primary producers, who find themselves unable to meet these demands, and still produce at a price which will enable their products to compete with those of Russia. It would be a physical impossibility for them to do so, even though they worked for nothing. This has to be taken into consideration when discussing, not only our primary industries, but our secondary industries also. That being so, I feel disposed to direct my attention to the internal position in Australia rather than to our part as a competitor in the world’s markets. It seems to me that all countries will have to work along the same lines. Even Great Britain has been forced to consider a policy which, under normal conditions, would not have been tolerated for a moment. At the present time, all round it is a case of selfpreservation. Our first responsibility as legislators is to our own people. The average primary producer to-day is very much in the same position as the average worker; his concern is how to get food, clothing, and shelter.
– The honorable member’s remarks are most interesting, but I ask him to endeavour to confine his remarks to the item. At present he is speaking all round the subject.
– The Deputy Leader of the Opposition entered into a general discussion, and I thought that I might be pardoned if I transgressed similarly. The reduction of wages will not place this or any other industry in Australia on a profit-making basis, or solve the problem in terms in keeping with our social standards. Yet in January of this year Professor Copland, when giving evidence before Chief Judge Dethridge in the Arbitration Court, expressed the opinion that a 10 per cent, cut in wages would have the effect of creating more employment in industry, because the wage fund would be spread over a greater number of workers. The Government accepted the position created by the court, and threw upon employers in in dns.try the responsibility of proving the soundness of the argument that the reduction of wages means more employment. But can any one now contend that the 10 per cent, reduction has really resulted in more employment in the various industries in Australia?
– There is less employment to-day than there was twelve months ago.
– And taxation is further hampering industry.
– I do not deny that the burden of taxation in varied forms is a staggering one, so that industry can scarcely carry it, yet, notwithstanding that, and with all the economies that are supposed to have been made, the budgetary position of the various governments of Australia has daily become worse. There has been a substantial addition to the ranks of our unemployed in_ every State and, as a consequence, the liability of the various Stait governments per medium of the dole is daily becoming heavier. In regard to the relief measures to be undertaken to meet our present desperate situation, no government can stand out against the expressed will of the people ; and if the people are not fed, clothed, and provided with shelter, they will make their power felt and, eventually, overthrow any government that fails them. The budgetary position of the Commonwealth and State governments is also becoming increasingly difficult owing to- the interest and exchange burden* of our oversea obligations. I repeat that it is not possible to solve the present financial and economic problems of the Commonwealth by wage cuts. As the honorable member for South Sydney (Mr. E. Riley) interjected a few moments ago, this policy has had the effect of making the position worse. Obviously, the 10 per cent, cut in wages, ordered by the Arbitration Court, has not eased the situation. I honestly believe that, largely owing to development of the application of science to industry in all its forms, we have reached the stage at which it is possible to provide all the requirements of the community with a much less expenditure of industrial effort than formerly. This view has been expressed by, among others, the Governor of New South Wales (Sir Phillip Game), in an address to members of the New South Wales Commercial Travellers Association, -at a banquet which 1 attended on behalf of the Ministry, and by the last Governor-General (Lord Stonehaven) before he left Australia.-
– I shall be glad if the honorable member will connect his remarks with the item under discussion. If a general address on economics is permitted upon every item of the tariff the debate will be unduly protracted.
– Perhaps I have transgressed to some extent, but I am endeavouring to establish my position, and that of those associated with me in relation to this important problem of maintaining the standard wage and conditions of industry in Australia in keeping with the ideals .of the industrial movement. The honorable member for Werriwa .(Mr. Lazzarini) has urged that steps be taken to .safeguard -the position of .all indus trialists,, because he, and other members of the group associated with me, believe that the developments of the last eighteen mouths in Australia have been along lines contrary to that approved by the work* ing class movement of this country. We contend that the present problem will not. be solved by the reduction of wages, which really means the diminishing’ of the purchasing power of the people. All workers should be provided with the means whereby they can live and enjoy a higher standard of comfort. If this principle had general application, all sections of the people would be benefited. Even our primary producers would be helped, because, under existing conditions the export market is practically closed to them, and they must necessarily look tq the home market.
– The home market is totally inadequate.
– It may be inadequate totally to absorb the’ products of some primary industries, but I suggest to the honorable member that the desperate plight of our primary producers is due largely to the enormous commitments arising out of the war and our huge interest burdens, I do not wish to in any way belittle the difficulties pf our primary producers. All I wish to establish is that all sections of the people, whether they be industrialists or agriculturalists, are now on common ground. If these forces could be properly marshalled they would make their influence felt in the affairs of this country, and probably other countries, in a way that would correct a position that cannot be corrected along the lines suggested by the Deputy Leader of the Opposition.
. ^1 spoke ,at .some length upon this item yesterday, so I do not propose to occupy much of the time of the committee this afternoon. I intend to move an amendment to the .amendment submitted yester: day by the Minister for Trade and Cus=toms ,(Mr, Forde). Honorable members will recall that I foreshadowed an amendment which I intended to move, but intimated that I could not submit it until the Minister’s amendment had been dis-posed of. I find now that, if I divide my amendment into two parts, I .can move the first part as an amendment to the Minister’s amendment. I therefore move -
That the amendment be amended by omitting all the words up to and including the word “ gazettal “, with a view to insert in lieu thereof the words “ And on and after the 18th September, 1031, the rates of duty to “.
The Minister’s amendment will then read - “And on and after the 18th September, 1031, the rates of duty to be, per ton, British, 90s.; intermediate, 110s.; general, 130s.”.
Honorable members will see that the rates of duties proposed in my amendment are the same as those submitted by the Minister and the Tariff Board, with the difference that they will apply immediately as recommended by the Tariff Board, whereas under the Minister’s amendment, the rates would apply if and when the industry had reached the stage of producing 60,000 tons per annum.
– On which basis the Tariff Board made its recommendation.
– If the Tariff Board were called upon to-day to report upon this item, it would, in all probability, recommend duties of 70s. British, 90s. intermediate, and 110s. general, for the simple reason that since it submitted its report in April last the industry has been further protected by an increase in the primage duty.
– There has also been a drop of £2 a ton in prices in England.
– That is so, but the duty will still give ample protection to the industry. The protection given by, the primage duty when the Tariff Board’s report was submitted was equivalent to 13s. 2d. a ton. To-day, as a result of lbc increase of primage duty, that protection is approximately -35s. a ton. This is why I express the belief that if the Tariff Board were called upon to-day to make a recommendation with respect to this item it would probably recommend a lower range of duties, the difference being bridged by the increased primage. Although the primage duty was imposed for revenue purposes it is undoubtedly protective in its incidence. The Minister this afternoon also said that all the profit that was being made by Lysaght Limited was 9s. 3d. a ton. He even mentioned the percentage on the capital invested, and added that the company was selling ite product’ at £28 10s. a ton. I pointed out at the time, by way of interjection, that, according to quotations in the Sydney Morning Herald, the present price is £29 10s. a ton for galvanized iron, and this fact was also mentioned by the honorable member for Henty (Mr. Gullett). Even assuming that all the calculations of the Minister otherwise were correct, the profit per ton must be not 9s. 3d., but at least £1 9s. 3d. On this point I direct attention to the following comment to be found on page 9 of the Tariff Board’s report : -
The balance-sheets and trading and profit and loss accounts of John Lysaght (Australia) Limited, the distributing company, which were obtained by the board, disclose that very high profits were being earned during the past three years.
What has the Minister to say to that?
– What was the percentage on capital invested?
– The Tariff Board does not state the percentage.
– Up to December last it was 4.8 per cent, of the cash capital invested in the industry.
-! am going by the Tariff Board report.
– The investigation made by the audit inspector stated that the returns of this company could not be regarded as satisfactory for a concern with such a large amount of capital involved.
– I doubt whether the present, return of any industry in Australia can be regarded as satisfactory, bearing in mind’ the amount of capital invested. The Tariff Board report states clearly that “ very high profits were earned during the past three years “ by this company.
The Deputy Leader of the Opposition (Mr. Latham) made an excellent speech this afternoon, in which he discussed the possibility of developing an export trade in iron and steel. It would be a great thing for this country if our big natural secondary industries could reduce their costs to a point which would make possible an ‘export trade, but the price of Australian galvanized iron would have to be reduced by more than half in order to make an export trade possible. The price of galvanized iron in this country is £29 10s. a ton at present, and similar quality British galvanized iron can be placed on board ship in skeleton felt-lined cases at £13 per ton.
– The report of the Tariff Board states that the high profits were made by the importing company, and not by the Australian manufacturing company.
– The companies are one and the same.
– The profits were made on imported iron which was distributed by John Lysaght (Australia) Limited.
– It may be that this concern has earned more substantial profits in one branch than in another. l.ii all the circumstances, I move -
That all the words up to and including the word “gazettal”, be omitted with a view to insert in lieu thereof thu words “And on and after the 18th September, 1031, the rates of duty to”. if my amendment is agreed to, the result will bc that on and after the 18th September, the rate of duty on galvanized iron will be “per ton, British, 90s.;- intermediate, 110s. ; general, 130s.”. These were the rates recommended by the Tariff Board. When the amendments now before the Chair are dealt with, I propose to move an amendment which I foreshadowed yesterday with the object of requiring this company to sell galvanized iron at £25 a ton, the price which the Tariff Board considered to be fair, or forfeit the protective duty.
– The Deputy Leader of the Opposition (Mr. Latham) made a good speech from his point of view; but we must realize that it is impossible for us to export many of our secondary manufactures, because our wage standards are very different from those of other countries. The object of the Government in imposing these duties is to enable the Australian manufacturers to capture the Australian trade. I consider that it is reasonable to ensure to the local industry the local market. The Deputy Leader of the Opposition had something to say about the wages paid to the workers in this industry. I have had an opportunity of inspecting the plant of this company, and I have seen its employees at work. No amount of money would induce me to do work of the kind that these men have to do. They are stripped practically to the buff. They have to work in an intense heat with hardly a stitch of clothing on them. No man could stand such work for very many years, for it is slavish and heavy in the extreme. These men deserve and earn every penny they get.
– What is the rate of sickness among them?
– If I told the right honorable member he would immediately leave for Newcastle to establish a practice there. We have been told that if the price of galvanized iron were reduced more of it would be purchased. The price of wool has been reduced, and wages in the wool industry have fallen tremendously; but the wool industry is not prosperous. The demand for wool has not increased. The price of butter has come down, to the grief of the honorable member for Gippsland (Mr. Paterson) ; but that has not brought prosperity to the industry.
– More butter is being eaten in Australia than ever before.
– The purchasing power of many people has diminished so that they cannot afford to buy butter. The price of boots has come down; hut large numbers of employees in this industry are out of work,
– The average price of manufactures has gone up.
– The price of eggs has fallen, but there is intense depression in this industry. The increased consumption of eggs clue to the fall in price has not been sufficient to maintain the industry on a profitable basis. The argument that if the cost of production is reduced the increased consumption of commodities will bring prosperity will not boar analysis. The price of house property in Sydney and other cities has fallen, but the building trade is in a most unhappy position. What is needed is the provision of employment for the people so that they can buy the produce of the farmers and others. The reduction of wages will not solve our economic problem. The banks - and I refer to both the savings banks and the trading banks - are all feeling the effects of the reduced incomes of the people.
Yesterday afternoon, I met an Australian native who has just returned to this country from America where he had lived for 30 years. He had been listening to the speeches delivered in this chamber, and he told me the Americans would not think of reducing wages in order to solve the unemployment problem. He said that in the United States of America everything possible was being done to maintain the existing wage standards. Lysaght Limited has not paid a dividend for the last two years, and unless relief canbe, given to the industry, it is hardly likely that the shareholders will agree to continue operations. It cannot be expected that the business will be maintained indefinitely at a loss. If the production of galvanized iron is discontinued locally, it is probable that a thousand men will be put out of work. This would be a serious thing. The Government should be doing its utmost to find work for our people, and it should resist every effort to develop a situation which will result in more men drawing the unemployment dole.
– If we have less industry, the Government will have a lower revenue from taxation.
– That is so. Our revenue from income taxation and customs duties has fallen tremendously. As the representative of a constituency which is largely industrial, I know that there is a very unsettled feeling among the people. If employment is not soon found for many people who are now out of work, we shall reach a most dangerous position. I intend to resist every effort to place the employees in the galvanized iron industry on the labour market If this industry is stopped, it will have a detrimental effect on mining, and many other industries. I know very well that our farmers have been hard hit, but they do not buy galvanized iron every day.
– They cannot buy any.
– If their position is a? had as that it would not make any difference to them if the price of galvanized iron were cut in half.
– Does the honorable member think that the existing duties are high enough?
– I do, becausethe company has said that it can maintain operations under present conditions. We must face the fact that our industrial troubles are largely due to the mechanization of industry. The inventive genius of man has created a Frankenstein monster which is crushing the working man. I was asked the other day whether I believed in the 44-hour week. I replied that I believed in working such hours as were necessary to produce our requirements. If it is necessary for us to work eight or ten hours a day to produce what we need, we must do it; but if it is only necessary to work six hours a day, we should only work that length of time. Machinery is continually displacing manual labour, and soreducing the purchasing power of the community. We shall have to face the situation fairly and squarely sooner or later, and devise some means of overcoming the troubles that have been caused on this account. if my income were to be reduced, I should have to move to a smaller house. If I were a storekeeper, and my turnover fell, 1 should have to be satisfied with a smaller store. We must recognize that when we strike a blow at the wages of the working man, we strike a blow at every section of the community, including the farmers. It is a poor policy to reduce wages.
– There are two amendments before the committee. One is the hermaphrodite proposal of the Minister which has impossible restrictions attached to it, and the other is the full-sexed proposal of the honorable member for Gippsland (Mr. Paterson) which is designed to make galvanized iron available at the price which the Tariff Board considered to be fair. If the first proposal is agreed to it will be a reflection upon the common sense of the committee, but if the second is adopted, it will be beneficial to the whole community. The Government’s proposal to increase the duty on galvanized iron is manifestly unfair. The position in which the Australian iron and steel industry is at present placed is due not to overseas competition, but to econo mic circumstances and industrial conditions which cannot be maintained. These conditions are now breaking down, and under economic pressure will continue to do so until normal conditions return. That point was stressed by the Deputy Leader of the Opposition (Mr. Latham) in an admirable contribution to the debate this afternoon. I cannot refrain from contrasting the attitude of the Deputy Leader of the Opposition with that of the Minister (Mr. Forde), who endeavoured to defend these duties on the ground that he is under a definite obligation to the iron and steel industry. I suggest that he is under a more definite obligation to the people of Australia than to any particular industry.
– I did not say that I was under any obligation to the industry, but that we should discharge our obligation to Australia by supporting these duties.
– The Minister left a definite impression in my mind that he is under an absolute obligation to the industry. He has a more definite duty to “perform to the people of Australia. The Minister ia endeavouring to provide special conditions to a privileged industry, which, in view of our economic circumstances, cannot continue. Although the products of the primary producers are being marketed under most unfavorable conditions, practically everything they require for production is increasing in price. The duties on iron and steel and other commodities used in primary production are reaching such high prices that it will soon be impossible for many of our producers to obtain them. The protection which the Government proposes to afford to this industry is unreasonably high, and is doing incalculable harm to other industries, particularly those which are exporting a portion of their production, and thus assisting Australia financially. Primary production needs encouragement at this juncture, perhaps to a greater extent than at any other period in our history. The cost of implements and material required in primary production should be reduced instead of increased. Honorable members opposite have referred to the prevalence of unemployment; but the fiscal policy which they are supporting is aggravating the position. As these duties do not affect only the primary producers, who are marketing their produce over.seas, but the whole community, further tariff increases should not be tolerated. According to the Tariff Board’s report, from which quotations have been made from time to time, galvanized iron which could be sold in Australia at £25 a ton, is retailed at approximately £30 a ton. It has been said that the farmers are getting the benefit of the exchange, which can be set off against the high prices they are paying for certain commodities used in production. The farmers are getting the benefit of the exchange, because they are producing for export, and the manufacturing industries which the Government is bolstering up under these proposals should also be exporting. Why are not those engaged in the manufacture of iron and steel deriving any benefit from the exchange rates which prevail to-day? It is because, they are not producing for export. Possibly certain disabilities are preventing them from doing so at present, but, as mentioned by the Deputy Leader of the Opposition, these difficulties could bc overcome if the industrial position in Australia were other than it is to-day. If the economic position of Australia were taken into consideration, and the industry placed on a proper basis industrially, it could export, and enjoy the same advantages from the exchange that are being obtained by primary producers. That aspect of the subject, which is too frequently overlooked by those who have addressed themselves to this problem, is dealt with in a leading article recently published in the Sydney Morning Herald which roads -
The growing general appreciation that there is something wrong about the tariff does not depend upon statistics. Statistics have misled Australian publicists for years. The essential truth is that in this critical emergency the high protective policy which has held the field for years has not enabled our manufacturing industries to contribute anything substantial towards paying our oversea debts. Why, since we must continue to export, should primary producers alone be expected to produce at a loss in order to maintain exports? Why should not the protected manufacturers also he asked to export at a loss, or at least to make an effort to export?
That illustrates the point which I made a few moments ago when I said that the benefits which the primary producer i« deriving from the exchange rates could also be obtained by Australian manufacturers if they were producing for export. If they cannot do so, the position must remain a3 it is until economic pressure brings the people of this country and this Parliament to a sense of what is right. The price of British galvanized iron in Great Britain is £13 a ton, the primage duty on importations” into Australia £1 Ss. a ton, exchange £4 5s. a ton, freight, insurance, and wharfage can be put down at £3 a ton, and customs duty at £5 10s. a ton. That gives a total natural protection to the Australian industry of £14 33. a ton.
– Thai brings the landed price in Australia up to £27 3s. a ton.
– Yes. The retail price of galvanized iron manufactured in Australia is over £30 per ton. In spite of these figures we are asked by the Minister to support these exorbitant da ties. Nothing could more definitely indicate the obligations of the committee to reject these smashing proposals than the figures quoted. The Government should revert to the duties imposed under the 1928 schedule, but I suppose that is too much to expect this Government to do. I intend to do everything I can to reduce these unnecessarily high duties, particularly in view of the fact that there has been a reduction in the cost of commodities used in production. Coal has dropped nearly 50 per cent, in price, and spelter is now £25 13s. a ton, which represents in the matter of manufacturing galvanized iron, a reduction in costs of £1 lis. a ton. We have been informed from time to time that the Australian workman enjoys a higher standard of living than the workmen of other countries ; but it is very doubtful if the average Australian workman enjoys the high standard which some believe that he possesses. It has not yet been established that the Australian workman is entitled to a higher standard of living on a lower rate of production. The farmers have the right to claim similar wages and conditions to those enjoyed by men engaged in other industries; but such conditions can be justified only when Australia’s position is economically sound. The wages which some are claiming in Australia today cannot be generally paid, and the only sound course to adopt, is to reduce the wage standard so that Australian manufacturing industries may be able to produce at a lower rate for home consumption, and dispose of their commodities in the markets of the world, which at present they are unable to do. I could not illuminate that point more definitely, or completely than it wa3 illuminated this afternoon by the Deputy Leader of the Opposition (Mr. Latham). What puzzles me is how honorable members on the other side who represent rural constituencies can support this item. The honorable member for Fremantle (Mr. Curtin), with his faculty for seeing things with some breadth of vision, and with some degree of introspection, made his position perfectly clear, and I hope that other Labour supporters who are equally concerned with the representation of rural industries, and perhaps more definitely than the honorable member for Fremantle, will view this problem with equal clarity. I cannot understand how the Minister for Defence (Mr. Chifley) can justify his support of this proposal. He represents a constituency which contains a great many primary producers, who will be badly hit by the imposition of this duty, yet I presume that he will record a vote in favour of this proposal to increase the penalties already inflicted upon the rural community. Then, again, the honorable member for Corangamite (Mr. Crouch) represents a constituency in which rural production is taking place on a considerable scale. How can he justify a vote in favour of this duty?
– He surely will not vote for it !
– I sincerely trust that the honorable member’s pious hope may be realized. The honorable member for Gwydir (Mr. Cunningham), who is a member of the Cabinet, represents a constituency which embraces a large proportion of primary producers, men who in a hundred different ways will be affected by these impositions. How in the name of high heaven is the Minister going to justify in his constituency a vote in favour of these increased penalties upon the primary producers? Are the constituents of the honorable member for Eden-Monaro (Mr. Cusack) going to be satisfied with the buffoonery with which he to-day attempted to justify his support of this proposal to increase the cost of production to the detriment of the primary producers throughout southern New South Wales? The Minister for Trade and Customs (Mr. Fordo) himself represents one of the greatest producing electorates in Australia. Sugar is largely produced in Capricornia.
– The sugar-growers have been protected against importation, and they, in turn, are quite prepared to give protection to secondary industries.
– The sugar industry utilizes manufactures of iron and steel to an incalculable extent. How then can the Minister attempt to justify this increased duty?
– My constituents approve my attitude.
– The Minister has introduced a schedule containing devastating duties, and I ask how he, in com mon with other honorable members who are supporting this item, can return to his constituency and justify his action. The honorable member for Oalare (Mr. Gibbons) told the farmers a little while ago that they were to receive 6s. 6d. a bushel for their wheat. Dare that honorable member return to his constituency and attempt to justify a vote in favour of this duty, which cannot but inflict severe hardship upon the primary producers? The honorable member for Indi (Mr. Jones) was elected to this Parliament as the result of a political misadventure on the part of his opponent. He represents large farming interests, yet I have not heard him protest against this duty. Does he intend to attempt to justify this further infliction upon his constituents? If he votes in favour of this proposal, they will certainly ask him to explain his action. The honorable member for Bendigo (Mr. Keane) is also concerned with this item. Although voluble at times, and frequently presenting his views on various proposals, he has been strangely silent on this item. I suggest that he has a good reason for his silence. He knows that it is impossible for him to justify, in any way, a vote that would help to carry this proposal. Where is the honorable member for Grey (Mr. Lacey) who represents a
South Australian constituency largely devoted to primary production?
– He is away sick.
– I suggest that a proposal of this nature makes a lot of honorable members sick. The Minister for Health and Repatriation (Mr. McNeill), who is the champion of inflation, represeuts a rural constituency. He is silent on this item, because he knows that it will be fatal for him, politically, to support it. The honorable member for Kennedy (Mr. Riordan) must also be brought under the lash, because he represents an electorate in which iron and steel, and everything manufactured from those commodities, plays an important part in primary production. Does he intend to cast a silent vote” on this proposal ?
– I hope that the honorable member will be able to justify the vote that he casts on this proposal. 1 challenge him and any other honorable member who represents directly or indirectly the primary producers, to make out a convincing case in favour of this duty, the imposition of which must place increased burdens upon primary production throughout Australia. I have said that I should like to revert to the 1928 tariff schedule. I realize that we may not be able to achieve that object, and therefore I propose to support the amendment of the honorable member for Gippsland (Mr. Paterson), which aims at giving effect to the recommendation of the Tariff Board. That body, in its report, has stated that sufficient protection is at present being afforded to this industry by the high rate of exchange between Australia and London. The board, in the course of an excellent report containing most logical reasons for the acceptance of its recommendations, considers that duties of 90s,, 110s., and 130s. should be imposed only if the local manufacturer undertakes to reduce prices immediately to the basis of a gross list price of £25 a ton. I have heard, during the debate, nothing that would justify any departure from that recommendation. The company which is producing galvanized iron in Australia is not likely to suffer from unfair competition. It is adequately protected, it enjoys a monopoly of production baaed on extortionate duties, and the increased costs in the industry are being borne by the people of Australia. The company has no ground for- objecting to the attitude of honorable members on this side in opposing this increased duty.
Mr.RIORDAN (Kennedy) [5.44].- The honorable member for Darling Downs (Mr. Morgan) has asked me not to record a silent vote on this item, and I shall accede to his request by saying a few words regarding the proposed duty on galvanized iron. It is true that I represent an important primary producing constituency, but I think that the primary producer in my electorate is generous enough to admit that we should give greater effect to the policy of Australia for the Australians.. The honorable member for Darling Downs (Mr. Morgan) has been speaking with his tongue in his cheek. How can he justify £12 a ton being charged for flour in Queensland, and passing on the cost to the consumers of bread, when in the capital cities of the other States flour costs only about £6 or £7 a ton? I ask the honorable member whether he is prepared to remove the duty of 6d. per lb. now imposed on butter from “New Zealand. Will he go to Mr. Moore, the Premier of Queensland, and urge that margarine should be substituted for butter, in order that consumers might get a cheaper article? Does he condemn the wheat pool in Queensland, which last year meant that Queensland farmers received 3s. a bushel for their wheat as against about 2s. a bushel for the rest of Australia. Would he close the Australian woollen factories, which, during recent years, have done much for Australia? The honorable member has been severe in his criticism of the Minister, and of members on this side ; I ask him where he stands in regard to the matters that I have mentioned? He is silent regarding the duty of 6d. per lb. on butter from New Zealand. I ask him whether he is prepared to advocate the abandonment of the Paterson butter scheme and the sugar embargo?
– Nor am I. Nor am I prepared tokill an industry which, although not established in Queensland, gives employment to 1,000 workers. I am no more prepared to destroy theiron and steel industry than I am to kill the sugar industry. But the honorable member for Darling Downs, who supports the sugar embargo and the duty on butter, would throw 1,000 workers out of employment in order to lower the price of galvanized iron by about £1 a ton. The honorable member advocates that the Australian primary producer should get Australian prices for his products, and at the same time buy his requirements at prices which rule in countries such as China. I ask him why it is that China is not one of the most prosperous countries in the world, seeing that wages there are so low. I invite him to tell the committee why India, with its cheap labour, is not prosperous to-day. The honorable member doubts whether the standard of the work performed by Australians is high. I ask him to direct his inquiry to the growers of sugar, and to ask them whether they do not get better results from Australian workers than they did from the kanakas.
– Conditions have entirely changed.
– Ofcourse they have. Perhaps the honorable member for Darling Downs would like to see kanakas employed in the manufacture of galvanized iron. The honorable member speaks of slave conditions in the Russian timber industry. Yet he advocates the removal of the duty on timber from the United States of America, which is produced by Chinese and Hindoos under conditions which are probably the worst in the world. I remind him that, whereas the United States of America purchases very little from Australia, Russia was a big buyer of our wool until recently. Some honorable members opposite are prepared to advocate a policy of protection when the industry concerned is in their own electorates, but they are not prepared to offer the same protection to other Australian industries.
– We are prepared to accept the Tariff Board’s recommendation in respect of galvanized iron.
– The honorable member referred to the quantity of galvanized iron produced in this country. In my electorate large quantities of galvanized iron and galvanized wire are used. I am concerned that the users of those commodities should have the protection which the existence of an Australian industry affords. Galvanized iron might cost £50 a ton but for the existence of the Australian works. It might even rise to the price it reached, during the war period. There should be a greater standardization of prices in this country. We are tending in that direction in connexion with our sugar, butter, and other industries.
Surely no honorable member will charge the present Government with not. having treated our primary industries fairly. In order to assist the wheatgrowing industry, the Government introduced legislation, to provide for a guaranteed price of 4s. 6d, a bushel for wheat. The Government is not to blame for that measure not being on the statute-book. If it is urged that the Government could not have financed the guarantee, I reply that that was the concern of the Government, not of those who opposed its legislation. I give the honorable member for Darling Downs (Mr. Morgan) credit for having supported the bill for the creation of a wheat pool ; but I ask him who was responsible for killing that measure. Had. that bill been agreed to, the wheatgrowers of Australia would have received 4s. 6d. a bushel for their wheat last year, in which case they surely would have been prepared to pay an Australian price for their galvanized iron. This year the wheat-growers will get a bounty of 6d. a bushel for their wheat; hut what assistance will the wool-grower receive? The wool-grower realizes that the Australian market is the best market for his wool. My policy is to get our people back again into work, so that they may regain, purchasing power which will enable them to buy the products of our primary industries. With 400,000 workers unemployed, a big market is lost to our primary producers. We suffer not so much from, over-production as from under-; consumption, because of the loss of purchasing power. Some honorable members are prepared to close up the works of Lysaght Limited, because the galvanized iron manufactured there costs from £1 to £1 10s. a ton more than the price at which galvanized iron could be imported. Surely there are enough unemployed in our midst now without throwing a further 1,000 men on the labour market !
A new industry which is developing rapidly in Australia should provide a market for the product manufactured by Lysaght Limited. The . growers of tobacco will require large quantities of galvanized iron for their curing kilns. Surely those growers do not expect to get Australian prices for their tobacco and to buy their requirements at prices which operate in China !
– No galvanized iron is imported from China.
– Most of the galvanized iron which is imported comes from England, which prefers to buy wheat from Russia instead of from Australia.
– England gives us a preference in the case of dried fruits.
– That is because dried fruits cannot be obtained more cheaply elsewhere. If dried fruits or butter could be obtained more cheaply from Russia than from Australia, the order would go to Russia.
– There is an actual preference in the case of dried fruits.
– That may be so; but it would disappear if dried fruits could be obtained more cheaply elsewhere. It ill becomes the founder of the Paterson butter scheme to advocate that galvanized iron should be sold in Australia at overseas prices.
– Australia receives £12,000,000 a year for her butter, but nothing for her galvanized iron.
– Australian consumers pay more for their butter than is received for it overseas.
– The very people who encouraged the establishment of the galvanized iron-making industry in Australia would now destroy it in order that the farmers of Australia might receive galvanized iron at a slightly reduced price. They admit -that the farmers are not in a position to buy iron because of the low price received for their wheat last year. The lowness of the price is due to the action of the Opposition, which, while wanting protection for primary industries, is not prepared to give any protection to secondary industries. In order that galvanized iron might be procured for £1 a ton less than it now costs, honorable members opposite would be prepared to throw 1,000 men out of “work at Newcastle and 700 more at Iron Knob.
.- The honorable member for Kennedy (Mr. Riordan) endeavoured to show that an effort is being made to destroy the galvanized iron-making industry in Australia. Nothing of the kind is being attempted. On many occasions in this chamber. I have supported protectionist duties; because I have felt that the industry concerned merited my support. Honorable members may recall that I supported the proposed duties on steel, because I considered the iron and steel industry to be a key industry. I pointed out that in a time of crisis Australia might need such an industry. I urged, however, that the Tariff Board should inquire into the costs of production, because I regarded the high prices charged for steel as a burden on other secondary industries. That applies particularly to the manufacture of agricultural implements. If the price of steel -were reduced considerably, the prices of those implements would be much lower than they are. This company buys bars for the manufacture of iron sheets from the principal steel companies. It is said that unless the proposed duty is granted, a large number of men will bc thrown out of work. I contend, however, that no protection at all is needed at the moment. There is an exchange rate which is in the vicinity of 30 per cent., a 10. per cent, primage duty, a sales tax, and shipping, and other overseas charges, which give to the industry all the protection that it needs. The duty being on an ad valorem basis, operates on a 5 per cent, higher basis than would appear from the schedule. The industry already has the protection of a reasonable duty, and it is only because the Government is now proposing what is unreasonable for the protection of this monopoly that I am opposed to it.
I am a supporter of protective duties for the encouragement of any Australian industry, and am also in favour of the imposition of duties for revenue purposes ; but when a government goes so far as to make duties prohibitive, thus destroying all competition, and allowing monopolies to grow up, I cannot see my way to support it. Costs of production must be investigated during periods of depression, and no attempt should be made to bolster up artificial industrial conditions. Considerable stress has been laid on the fact that galvanized iron is required by settlers. The Tariff Board in its excellent report has drawn attention to that aspect of the matter, and has also pointed out that the building industry is suffering very acutely from the existing depression, and that its revival will depend largely on whether costs are reduced. 1 draw the attention of the honorable member for Kennedy (Mr. Riordan) to thai paragraph in the report. The board also says -
The advantages of a low price for galvanized iron as an important contribution to such a reduction arc st> obvious us not to require emphasizing.
That is unanswerable. Anybody who is acquainted with business enterprises knows that the turnover of firms that are associated with the building industry has dropped by at least 50 per cent, in the last, two years. The Tariff Board says that costs have to come down.
– Wages have to be reduced - that is the policy of the honorable member.
– No. I am opposing a monopoly, not the workers, as honorable members opposite allege. There has been an enormous dwindling of the turnover of all kinds of businesses’, but particularly in the building trade. That is emphasized in the report of the Tariff Board. This company, according to the report, has made substantial profits. If it cannot make a profit now on account of the shares that have been issued by way of compensation for patents and’ goodwill - upon which the Tariff Board has commented adversely - it, like any other company, must cut its costs: by wage reduction, administratively, in regard to distribution, or in any other way. Parliaments do not exist for the purpose of seeing that certain companies that are monopolies make profits while other companies are unable to do so.
– How much galvanized iron was used on the Commonwealth Bank in Sydney?
– The honorable member should know that most modern city structures are of concrete, and that structural steel is used in them. Galvanized iron is used in connexion with the houses of the poorer people, who cannot afford tiled roofs. The honorable member and others who think as he does would keep up the price of galvanized iron to the detriment of those poorer people. Broadly speaking, the report of the Tariff Board shatters any arguments that might be advanced to prove that galvanized iron is not necessary for the construction of the homes of the poorer people. This is essentially a New South Wales industry, its operations being confined to that State, which is the mad daughter of the Commonwealth. Unfortunately, that eccentric daughter happens to be the oldest and the most extravagant. Because of the blight of Langism, it is pulling down not only the other States, but also the Commonwealth. This company is endeavouring to carry on under uneconomic conditions, which do not prevail in other States - with such phantasies, for example, as a 44-hour week. It is expected that the Parliament of the Commonwealth will make allowance for such eccentricities, and impose higher duties. T do not believe that parliaments should function in that way. They should attend to the government of the country, and not endeavour to boost a monopoly. The Tariff Board says that in the present circumstances, it considers that, in arriving at what must be regarded as reasonable profit, such share capital as is represented by payment for goodwill, &c, should not he taken into consideration. It also says -
This issue of shaves is open to criticism, when it is remembered that all the share capital is virtually held by’ and all profits ultimately reach John Lysaght Limited, Kristol.
I consider that I have proved that there is no danger of overseas competition, and i hat the question is merely one of bringing down production Costs. The Minister quoted a mass of figures that evidently had been supplied to him, showing that German iron could bc dumped into Great Britain at a certain price. He quoted one type of iron or steel that was being sold in Germany at £7 a ton, which could be dumped in Great Britain at £3 a ton. That statement is not relevant to this discussion, and I believe that it was introduced only in order to confuse. The problem it relates to is one for Great Britain herself to solve, and the new National Government in that country will deal with it and similar troubles by means of a tariff that will be protective, as well as revenue producing. The Minister Ls quite aware, as must be those honorable members who are at all acquainted with customs matters, that, if any country endeavoured to dump steel or other goods into Australia, the duty would be calculated, not on the export price, but on the domestic value of the goods. Consequently, even if it were possible to send bar or sheet steel to Australia, the duty would be chargeable on the domestic price in the country of origin.
– It would be very difficult to exercise a check if the bars were sent to England and finished there.
– Every invoice from overseas must state the proportion that is substantially of British manufacture; therefore, in that matter our industries are safeguarded. The honorable member for West Sydney (Mr. Beasley), in a characteristic speech, said that an effort was being made to force down wages, and challenged those honorable members who sit on this side to show how much more work could be given by a reduction of wages.
– It never is.
– If the honorable member for Herbert (Mr. Martens) is a reasonable man, and is prepared to consider the matter without bias, I shall be pleased to discuss it with him at any time, because 1 consider that, in the present case, this- is a way in which unemployment may be alleviated. In some Arbitration Court awards, and in most of the wages board determinations in Victoria, provision is made for the payment of time and a half for broken time.
– That is not true in relation to federal awards.
– It applies in the engineering trade.
– Nonsense !
– The honorable member for Corio (Mr. Lewis) was for years the secretary of an industrial organization, and should be aware of the facts; but, as he is not, I shall produce to him a number of awards, so as to prove that my contention is correct. If a man is employed casually the employer has to pay him a loaded rate.
– That is for casual labour, not for broken time.
– The honorable member may call it what he likes, but the fact remains that a man who. is employed for two or three days has to be paid at the higher rate.
Sitting suspended from 6.15 to S p.m.
– I was pointing out that there is no likelihood of this industry being disturbed by dumping, and as it is a monopoly internal competition also is absent. The manufacturers of galvanized iron, must as all other industrialists are doing, face facts and reduce their production costs. This does not mean, as some honorable members are too ready to suspect, an attack on wages ; production costs cover a wide field. Other industries which have suffered a big diminution of income have had to adjust themselves to the economic circumstances of the times; the well-protected manufacturers of galvanized iron must do likewise. Unemployment does not necessarily follow wage reduction. Wo honorable member will deny that lower prices attract business. a.nd those firms which are writing down costs and cutting prices are getting the greatest share of trade to-day. Wages are no more sacrosanct than prices. I am quite as desirous as any other honorable member or private citizen of helping the unemployed, back to work, and for that reason I submit two suggestions for ameliorating the conditions of industry, and placing more men in employment. I mentioned that in most of the Wages Board awards in Victoria, and in some of the awards of the Federal Arbitration Court, there is provision that for casual work time and a half rates shall be paid. To my amazement two honorable members opposite, both of whom have been union secretaries, denied that. I quote, from the determination of the wholesale Grocers Board in Victoria, a clause which is in nearly every award in that State, except, perhaps, that for the transport industry -
Time rate. - Any person employed on time wages for less than the number of hours fixed for an ordinary week’s work, shall for each hour worked up to 24 hours, be paid at the ordinary wages rate with an addition of 50 per cent. [Quorum formed.]
– The object of that was to secure payment for holidays.
– If the honorable member is still unconvinced, I quote clause 8 -
Picnic Day. - Double time shall be paid for all work done in the metropolitan district on the second Saturday in February provided that the union hold their annual picnic on that day.
Luxuries of this kind which are provided for by awards could very well be dispensed, with for the time being. They make it difficult to give work to men who badly need it. Many employers would give casual work to men for two or three days. I refer particularly to the big departmental stores in Melbourne.
– Mention one.
– I have a definite assurance on that point by Edments.
Can the honorable member connect these remarks with the item of galvanized iron?
– I am drawing attention to some of the conditions which increase the cost of producing galvanized iron, and it is because this is essentially a New South Wales industry-
– That is the honorable member’s objection.
– New South Wales is the mad State of the Commonwealth at present, and has been the most extravagant. Must we continue to endure such extravaganee and the eccentricities of Mr. Lang? If ho chooses to repudiate the debts of his State, the other States are expected to pay them; if he persists with fantastic ideas, the Commonwealth is expected to concur. In addition to lopping off some of the more extravagant conditions which are imposed upon industry, I suggest that the basic wage should apply at 23 years of age instead of 21 years. It is theoretically based on a certain standard of comfort for a man, wife, and three children. The supposition that a. man of 21 has a family of three, shows a confusion of ethics with economics. In some awards in Victoria the basic wage and adult rates do not apply to persons under 23 years of age, and that means that young men, instead of being thrown out of employment when they attain their majority, preference being given to men of 30 or 40 years, who are more experienced, can retain their jobs and continue their training, rising by gradual increments to the standard wage. In a time of depression employers and employees alike must be reasonable, put aside class bias, and collaborate to remove some of the shackles from industry. Our trouble at the present time is primarily due to industrial and economic disequilibrium. Price levels in the primary industries have been forced down by world-wide influences, but the extravagant levels in the secondary industries still continue. The depression will not pass in a moment. It cannot be dissipated by either a policy of inflation to increase the purchasing power of the community, as the Treasurer suggests, or by excessive borrowing. If we continue to be hampered by inflexible wage laws, which do not allow industrial conditions to adjust themselves in accordance with the operation of economic laws, the depression will continue. The honorable member for West Sydney (Mr. Beasley) made a plea for Russia. He said that we have to put up with the competition of that country, because it had repudiated its international debts, and, therefore, was in a position to undersell all other countries. Such logic might appeal to a fraudulent insolvent who, having robbed his creditors, sets up in opposition to other traders who have been honest, or to a burglar who, having stolen his goods, can afford to sell at cut prices. But it should not have the approval of anybody who is honest, and it is certainly not a policy to be supported by any Australian parliament.
For the reasons I have stated, I shall support the first part of the amendment moved by the honorable member for Gippsland (Mr. Paterson). I am prepared to support any reasonable duties for the protection of Australian industry or for revenue purposes; but I am certainly not a prohibitionist. I am not prepared to block all international trade channels and allow the present state of economic disequilibrium to continue. 3 exhort those from whose lips we have heard only fantastic trade union shibboleths to recognize that the depression has hit everybody, and that men are unemployed because it is not profitable to employ them. If honorable members opposite will face the facts, they will not support the further protection of what is already a well-entrenched monopoly, but will vote for the amendment, which is in accordance with the recommendation by the Tariff Board.
.- It is true, as the honorable member for Balaclava (Mr. White) said, that the galvanized iron industry is situated in Newcastle. New South Wales; but it is still an Australian industry, and, therefore, the Government is justified in opposing the amendment. It is a noteworthy fact that most of the arguments advanced by the members of the Opposition were concerned with wages, the Tariff Board’s report, and the excessive cost of galvanized iron to the user. It is significant that honorable members opposite have not uttered one word as to the unemployment that would result from the lifting of these duties, so allowing the cheap products from overseas to compete with our own industry. Much has been said with regard to the proposed duty of £5 10s. a ton. That duty is- precisely equivalent to the original bounty of £4 10s., plus the protective duty of £1 per ton that was granted to the industry on the 1st January, 1930. As a matter of fact, the proposed duty is only 18s. per ton higher than the protection afforded to the industry by a previous government. In being so eager to remove this- protective duty, and allow into the country an imported article against which we could not compete, honorable members opposite have lost sight of the evils of unemployment that would follow such a course. The absorption of our unemployed is one of the greatest problems now facing the country. The Government has no means of absorbing these unfortunates’, as it does not control any industries. It is endeavouring to do the next best thing - to give all Australian industries adequate tariff protection against overseas competition. At page 5 of the Tariff Board’s report, I find these remarks -
The industry is of groat importance to Australia in that it is productive of a large amount of labour. Practically all the raw materials used are of Australian origin, and a very large percentage of their cost is the result of expenditure on labour.
A little further on the report continues -
Australia’s normal requirements of over 100,000 tons per annum would, if made in Australia, result in the distribution of wages amounting to over £1,000,000 per annum.
This afternoon the Deputy Leader of the Opposition (Mr. Latham) expressed the desirability of our fostering an export trade in this commodity. It would be interesting to know just what was at the back of the honorable gentleman’s mind regarding the standard of living that he visualized in this country as the result of the plan that he proposed. Following arc the duties levied on galvanized iron in different countries- of the world: -
Canada imposes a duty of 15 per cent. British and 25^ per cent, foreign, while the South African rates are free British, 3 per cent, foreign. In Canada, black sheets for galvanizing are admitted free, and consequently the protection needed is considerably less than if a duty were imposed on those sheets. Galvanized iron is not manufactured in South Africa, but adequate protection is promised directly the local manufacture is begun. In. all of the countries mentioned by me the wages in the galvanized iron industry are lower, and the hours longer, than those obtaining in New South “Wales, or any other State in Australia. In India, which has the cheapest labour in the world, the duty has recently been increased to £5 per ton to give adequate protection to the steel industry there. In view of those figures, I submit that a preferential duty of £5 10s. a ton in Australia is more than reasonably justified.
One must also consider this industry in its relation to other industries. It employs 1,000 men directly, whale an additional 1,500 men are engaged in the production of the steel, zinc, acid and other necessary raw materials, and in the mining of the coal used in all stages of manufacture. The livelihood of these 2,500 men and their dependants is entirely due to the continuance of the galvanized iron industry. With all due respect to the opinions expressed by honorable members opposite with regard to the interests of primary producers, I ask them should not some consideration be given to the interests of those whose existence depends upon the continuance of the galvanized iron industry in Australia? Should an inadequate tariff make it impossible for the industry to continue, the general production costs of such concerns as the Broken Hill Proprietary Limited, and the Electrolytic Zinc Company Limited, would be seriously affected by the loss of orders for steel, zinc, and other commodities.
It has been said by honorable member* opposite during this debate that, by proposing these duties, the Government is bolstering up a combine. I remind-then of the attitude of their party when in power; how it preserved the monopolistic rights of importers prior to the inauguration of this industry in Australia in 1921. Honorable members opposite maintain a discreet silence upon that aspect of the subject. I contend that the Government is sincere in its endeavour to provide a modicum of employment by giving this valuable industry adequate protection. It is estimated that, upon full-time production, at least £750,000 would be distributed annually in wages by this industry, of which approximately £300,000 would be paid directly by John Lysaght (Australia) Limited, Newcastle. Since the establishment of this firm’s works in 1921 it has distributed nearly £3,000,000 in wages, directly and indirectly. That money is still circulating in Australia. Had the industry not beer established here, the money would have gone abroad. With the whole of the plant operating on full-time production, these works could turn out 80,000 tons of galvanized sheets per annum, or more than twice the present consumption of the Commonwealth-. The manufacture of this quantity of galvanized sheets would require approximately 84,000 tons of steel, 12,000 tons of zinc, and 4,000 tons of acid, while over 200,000 tons of coal would be used every year in all the stages of manufacture, from the mining of the iron ore to the completion of the finished product. Since their inception, the works have manufactured over 200,000 tons of galvanized iron. It is estimated that the quantity of galvanized iron being used in Australia at present is only about 30,000 tons per annum, or considerably less than half the present capacity of the works.
Previous governments promised the industry adequate protection, so a precedent is not being created by the proposed duties. When the initial arrangements for the establishment of the works were made in 1918, a promise was given by the then Federal Government that sufficient protection would be granted to the industry, and, in its report of July, 1926, the Tariff Board recommended that when the works were in a position to supply the requirements of Australia, duties of £5 10s. British preferential; £6 10s., intermediate; and £7 10s. foreign, should be imposed.
The real difficulty of the Australian iron and steel industry is the keen overseas competition in finished products which are manufactured extensively from raw and semi-manufactured material. That competition emanates principally from the United Kingdom. The iron and steel products against which Australia has to compete have a distinct advantage in that they are the production of long hours and exceedingly low wages. In connexion with this, it is true that the conditions to qualify for the British preference rate have been lifted from 25 per cent, wages, and raw materials to 75 per cent., but owing to the certification in the invoice sheets not being subscribed to by principals, but by any other person, the door is opened to irresponsible declarations.
The following figures, supplied by the management of the Broken Hill Proprietary Limited, Newcastle, are interesting. They show that the following quantities of ore were produced in Australia for the years specified : -
The total production for the five-year period was 3,709,995 tons, and the metal contents of iron and manganese amounted to 65 per cent. We should embrace every opportunity to afford protection to an industry that uses such large quantities of Australia’s natural resources. It can be truthfully stated that at the very least, 75 per cent, of the tonnage to which I have referred was used in Australia in the secondary stages of the iron and steel iudustry, the other 25 per cent, being exported, so proving an asset to Australia by assisting to right our adverse trade balance. Honorable members will note the great increase in the production of iron ore for the year 1930 as compared with 1926. This was - due principally to the action of the present Government, in relieving the company, under a recent act, of special taxation on sales overseas of the products of an Australian industry. I am given to understand that the action of this Government made it just possible for the company to establish a sale3 organization overseas. Unfortunately, the export trade in iron ore, which held great promise of expansion towards the end of 1930 has fallen away, owing to the dumping of large quantities of iron ore produced in Russia and sold to the United States of America, and certain European States at less than the cost’ of production. That has had the effect of stopping further exportation from Australia for the present. I have no hesitation in whole-heartedly supporting this endeavour of the Government to protect a valuable Australian industry, and I sincerely trust that, with its further development, it will assist to absorb some of our unemployed.
.- The honorable member for Lang (Mr. Long) has given some very fine figures as to the distribution of wages and so on at Newcastle. That has all been at the expense of the consumers of Australia, who are paying for galvanized iron approximately twice the amount that would be paid if we had no such industry in Australia. I am sure that no one on this side wishes to close up or injure that Australian industry, but we do contend that it could be properly carried on at a much lower cost to the community than is’ the case at present.
I desire to answer some of the criticism levelled against the Tariff Board. It was alleged that the board had gone out of it’s way to make a voluntary suggestion that wages should be reduced. I have read the report, and it contains no such suggestion. The board recommended that no further duty should be imposed, and did so on the basis of a selling price of £24 9s. 5d. for galvanized iron being a fair one. In arriving at that figure, the board made it clear that it was working on the basis of the continuance of the existing rates of wages. It went on to point out that wages had been reduced by 10 per cent, in some industries, and that it was possible that a similar reduction would be made in the iron and steel industry, in which case there should be a reduction of 15s. 6d. a ton in the price which the board considered to be a fair selling price for galvanized iron. The board went no further than that, and at no time suggested that wages should be either lower or higher. In the circumstances, I think that sor.ie.th.iug in the nature of an amende is clue from the honorable member for Werriwa (Mr. Lazzarini) to the members of the board.
The board’s report has been adversely, and, I think, unfairly criticized by the Minister. The report, on the face of it, is extremely fair, and, as regards Lysaght Limited, even generous, because the board has declared that that firm should be maintained in such a position that it may continue to provide an adequate return on the capital invested. In “my opinion, it is not the duty of this Parliament to legislate so that Lysaght Limited, or any other firm, may obtain an adequate return on its capital. The majority of firms in Australia to-day are not obtaining an adequate return on their capital, and it is not right that such a return should be assured to this company at the continued expense of the consumers of iron in Australia. The board’s report did not suit the Minister, and he adopted the very unusual course of appointing two auditors to make an independent inquiry. Of course, it was the business of those officers to discover arguments in opposition to the Tariff Board’s con-* elusions. That was what the Minister set them to do.
– I deny that. The officers received no instructions except to investigate the facts. One of them was an officer of the Auditor-General’s Department.
– Why did not the Minister refer the matter back to the Tariff Board, which is itself an independent body? The board made a report with which the Minister disagreed, so he engaged officers to make another report. What duty were those officers expected to perform ? If they could not find material which would be available for criticism of the board, their report would be useless. The Minister would not have wanted them.
– All we wanted was the facts.
– The Minister already has at his disposal an independent and expensive body in the Tariff Board to investigate questions of this kind. It was grossly improper for the Minister, when he received a Tariff Board report which did not suit him, to instruct officers to make another -report.
It was stated by the Minister that this industry was still in its infancy, and required nursing. Surely it is time the industry grew up. It was first granted assistance in 1922, and it was then thought that a bounty of £2 10s. a ton would be sufficient to enable it to become established. That protection has now been increased to over £14 a ton. The industry has received in direct payments by way of bounty £469,000 of the taxpayers’ money. That is a disgrace te Australia. Besides this assistance, the industry has enjoyed virtually a monopoly of the business in Australia. The Tariff Board, in ite report, points out that natural conditions are most favorable to the establishment of the industry. It would appear, states the report, that there are few industries more capable of successful establishment in Australia than the galvanized iron industry, on account of the rich natural deposits of ore, coal and zinc, and the relatively big market for a product in which little variety is needed. In the circumstances, the industry, one would imagine, should be in a flourishing condition at the present time. Certainly it ought to be able to look after itself without excessive pro- taction. Nevertheless, we find that the price of galvanized iron to the public to-day is £29 a ton in Australia, as compared with £13 a ton for English iron.
– Where does the honorable member get the figure of £29 a ton?
– From the current quotations in the newspapers. When the board made its report in April, the price was £28 10s. a ton, and it is now £29.
– The present list price is £28 10s. a ton.
– The equivalent price of English iron is £13 a ton. -Is the industry worth maintaining at the price we have to pay for it ? This is a characteristic industry, because all the operations associated with it are performed in Australia, and the whole of the excessive cost is due to the artificial conditions which we have built up in this country. These high costs are not confined to wages, nor, indeed, to charges incurred in the running of Lysaght’s factory. They include the wages and overhead oats in that factory, but they are contributed to, also, by excessive costs at Iron Knob in South Australia, and the cost of obtaining zinc in Tasmania, the cost of conveying the ore and zinc to Newcastle, and the cost of coal and steel. This afternoon the Treasurer was asked whether anything could be done to obtain relief from the burden of exchange on payments made by Australia overseas. He replied that there was no way of obtaining relief from this burden while the present difference existed between the price levels obtaining in Australia and in other countries, and between the value «f our currency and that of other countries. Precisely the same thing applies in respect to our industries. It is impossible to establish industries in this country on a sound basis while price levels in this country are so much higher than in other countries, and while the value of our currency is so much less than that of other countries. We can obtain little if any relief from the arbitration courts. In the case of Lysaght Limited, wages comprise only 23 per cent, of the cost of manufacturing galvanized iron. Arbitration courts are powerless to reduce the costs which comprise the other 67 per cent. Other indus tries, such as coal and zinc, are responsible for most of the costs, and with those the Arbitration Court, when dealing with an application in regard to Lysaght Limited, would have nothing to do. The court is limited to consideration of one industry at a time, and then only to the wages, paid in that industry. It is impossible for the Arbitration Court, even if so disposed, to give effective relief to the industry as a whole. Then there is another point in regard to these bolstered up industries which enjoy a monopoly. So long as they continue to enjoy a monopoly they can pay the high costs with which the industry is loaded, and while they can do this, the Arbitration Court is loth to interfere. The court is not prone to put the interests of the public first. The question generally directed to the court is, “ What can the industry stand ? “ and so long as an industry enjoys a monopoly as this one does, it can afford to pay the excessive wages demanded. While an industry is bolstered up by embargoes and high protective duties, it is practically impossible to obtain any substantial measure of relief through the Arbitration Court. It is possible, however, to obtain relief through the tariff. Here we can start at the root of the trouble, because there is no doubt that the high costs associated with Australian industry are due largely to the incidence of the tariff, which affects, not only the particular industry under consideration, but all those with which it is allied. This Parliament should not listen to manufacturers who produce figures, showing that they are not making profits, and cannot get along with less protection than they are receiving. Let us fix a fair selling price for products, and then tell the manufacturers that they must sell at that price if they wish to receive protection.
– The honorable member believes in price-fixing?
– For industries which receive tariff protection, I do. If Lysaght Limited, would undertake to sell its product at £25 a ton, I would not care how much protection it received. Industry would not die out if such action were taken. Firms would find ways and means of carrying on, just as those in unprotected industries are finding means of meeting the adverse conditions to-day. If we cut out protection unless the price of galvanized iron were reduced to £25 a ton, it would, of course, necessarily affect the allied industries associated with the production of coal, zinc and steel; but prices in those industries must come down too. The consumers cannot be expected to carry the whole of the steel industry, together with its allied industries, for au indefinite period. In the past, a great deal of galvanized iron was used in the cities, but the building of houses in the cities has now almost ceased, with the result that practically all the galvanized iron sold to-day goes to country users. I ask honorable members to compare the position of those engaged in most rural industries to-day with the workers in Lysaght’s factory. If we make such a comparison we shall see that there is no justification for this attempt to keep Lysaght Limited in its present favorable position. The Tariff Board has endeavoured to effect a compromise. It has shown that the industry at present enjoys sufficient protection to enable it to carry on profitably. Therefore, I ask the committee to support the recommendation of the Tariff Board.
– Under cover of what I regard and what is generally admitted to be a laudable object, namely, the establishment of the iron and steel industry in Australia, the Government is, in my opinion, engaged in a huge conspiracy with the employers and employees in this industry to secure wholly unwarranted tariff concessions at the expense of the general public.
– I rise to a point of order. I submit that the honorable member for Warringah (Mr. Parkhill) is not in order in suggesting that the Minister or the Government is engaged in a conspiracy with the employers and employees to secure tariff concessions. The remark is objectionable, is without foundation, and is offensive to me as a supporter of the Government. I, therefore, ask that he be called upon to withdraw it.
The CHAIRMAN (Mr. McGrath).I call upon the honorable member for Warringah to withdraw the word “ conspiracy “.
Mr. ARCHDALE PARKHILL.Very well, Mr. Chairman, I shall do so. No one objects to the establishment of the iron and steel industry in Australia if the proposals for its encouragement are reasonable. But in some quarters there appears to bc an impression that if the industry can secure the ear of the Minister for Trade aud Customs, and the sympathetic consideration of Government supporters, who never attempt to justify any of the duties that are proposed, it is entitled to ask for whatever tariff duties it likes, regardless of the effect of such protection upon other industries in the Commonwealth. That is what is being done in this instance. I am convinced that if the Minister had, at the outset, intimated that Lysaght Limited must be satisfied with the duties recommended by the Tariff Board, that company would very speedily have reconsidered its position and have been prepared to carry on with that measure of protection. I, for one, am not prepared to sit in this Parliament and see the genera] public penalized to the extent contemplated in this tariff item without entering ray protest against the duties proposed by the Minister. I regard the report of the Tariff Board upon this subject as eminently fair, bearing on the face of it evidence of the meticulous care exercised by the board in arriving at its decision. Its recommendations might very well have been accepted by the Minister. But the honorable gentleman did not adopt that course. In his treatment of its report he has been exceeding his treatment of the Tariff Board’s recommenda- ti ons.
– When did the honorable member become the champion of the Tariff Board?
– I am championing more particularly the prestige of every public servant of the Commonwealth. If I do not agree with the recommendations of the Tariff Board I say so quite openly, as honorable members well know. In thi3 instance, I approve of its report.
– Nevertheless, the honorable member objects when the Minister disagrees with the recommendations of the board.
Mr. ARCHDALE PARKHILL.Tlie Minister has disagreed with so many of the recommendations of that body that it would be mere reiteration on my part to constantly refer to tariff items which he has introduced at variance with views expressed by the board. In this case, no one can deny that the right course for the Minister to adopt, if he disagreed with its recommendations, was to ask the board to reconsider its decision. Instead of doing that, he secured the services of an officer of his department - one who, of course, was perfectly unbiased, and with whom the Minister had no prior interview, but who, nevertheless, would be fully cognizant of what was required of him.
– I did not do that.
– Of course not ! The Minister also selected another official from the AuditorGeneral’s Department. “Promiscuouslike” he looked down the list of officers and, without suggesting what was required of him, selected one man haphazard, and instructed him to make an investigation .
– As a’ matter of fact, I allowed the Comptroller-General of Customs to select the two men.
– We are asked to believe that the Minister did not inform these officers what they had to do. Probably he thought that they would know perfectly well what was required of them, and apparently they did the job very well, indeed.
– The honorable member is doing a grave injustice to two respected public servants.
– I am not. Apparently, the officers in question did their work very well, because the Minister entirely disregarded the report of the Tariff Board, and in the course of his remarks he quoted their criticism of the board’s recommendations. It may be of interest to honorable members to know that whole “ slabs “ of statements which the Minister read from the report of these two officers had been issued by John Lysaght Limited as propaganda in support of the company’s claim for these higher duties. No reasonable person can regard this procedure as fair. I enter my protest against the way in which the Tariff Board has been treated in this matter. Its report has been entirely, overridden by the report of other officers, and its recommendations stultified and more ‘ or less ridiculed by the Minister, whose clear duty is to protect it.
Exception was taken just now to my statement that the three parties to this arrangement were engaged in a conspiracy to secure these higher duties at the expense of the general public, so I shall not use the word in question at this juncture, but it is clear that these three sections are working together in perfect harmony to secure a certain definite object at the expense of the people. That is what I mean. Honor-; able members can call it what they choose. It is obvious that manufacturers, believing they have the Minister and the government supporters on their, side, ask for twice as much as they expect to get. Let us examine the position of the company. On page 15 of the Tariff Board’s report there appears the following : - .
The share capital of ‘Lysaghts Newcastle Works Limited is £936,059, and is held by John Lysaght, Bristol, and John Lysaght (Australia) Limited. The bulk of the shares in the latter company is held ‘by John Lysaght Limited, Bristol, which means, in effect, that the Newcastle company is owned by John Lysaght Limited, Bristol.
In the absence of shareholders other than Lysaght (Bristol) and Lysaght (Newcastle), where is the justification for crediting £500,000 worth of capital to John Lysaght Limited (Bristol), and what justification is there for the imposition of duties that will ensure a profit not on the capital actually engaged in the business, but on that amount of capital plus £500,000 of watered stock in the nairne of the British company? The people of Australia should not be penalized by these higher duties. I have been asked to say that this is not a conspiracy. If it is not, I have no hesitation in saying that it is one of the biggest “ ramps “ ever attempted in this Parliament in connexion with tariff matters. If the whole of the capital of approximately £1,000,000 were Australian money actually engaged in the business something might be said for the claim that these duties were desirable for the building up of the industry; but even then no one could argue with any justification that the concern would be entitled to ask the Minister for tariff protection which would guarantee to it interest and sink- ing fund to the extent of 1 per cent.
The Minister and other members of the Government have argued on previous occasions that it is the duty of Parliament to fix such rates of duty as will ensure to this industry a sufficient return to enable it to pay interest on the capital invested in it, irrespective of any considerations of efficiency, watered capital, or rates of wages. Apparently the general public has no right to expect any consideration in these matters. The price of galvanized iron is to be fixed, for the present at any rate, at from £28 to £31 a ton, in order that interest may be paid on £500,000 worth of dead capital or nominal capital in Britain, in addition to interest on the money which is actually being used in the business in Australia. This, in my opinion, is not right. Yet a Labour Government, with the solid, though silent, support of a phalanx of Labour members, is taking this stand. Why they should do so I have a shrewd idea. It seems that because the industry is giving employment to a number of men at high wages, the general public is to have no consideration shown to it. The employees in this industry are not to be subjected to any reduction of wages, notwithstanding that the workers in other industries have had their wages reduced by the Arbitration Court. I will not subscribe to such a policy, nor do I think the electors of Australia will do so when the matter is submitted to them for decision. The Tariff Board made a careful investigation into the position of the employees of this industry, and on page 20 of its report it points out that -
The recent decisions of the Federal Arbitration Court reducing the wages in many industries by 10 per cent, suggest the possibility of an extension of this method of affording relief to other secondary industries. Whilst not anticipating the reduction of 10 per cent, in wages in the galvanized iron industry, the board lias, however, considered the effect on prices if such a reduction should be made in the future.
The report goes on to say that -
The average wage for a full week’s work in the production of sheet bars for galvanized iron manufacturing is £5 lis. 2d. The average wage for full-time employment in the galvanized iron industry itself is £6 9s. Id. At present the employees in this industry are working part time and their average earnings are much lower. Whilst this is an equitable method of distributing the ‘ wages available, it fails to effect any savings in actual costs of production.
Since that report was made there has been a reduction of 10 per cent, in wages generally, but it has not had effect in this industry.
– The industry is not working under a federal award.
– I could quote the evidence of Mr. Lightfoot Walker in support of my statement. He made it clear that the industry is unaffected by such reductions. Surely no honorable member who believes in the fixation of wages by the Arbitration Court could object to the court reducing wages any more than they would object to it increasing them. Presumably, if the Labour party stands for arbitration as a method of fixing wages, it is willing to honour awards of the court which provide for reductions of wages just as it expects awards which provide for increases in wages to be honoured.
– According to the report Mr. Lightfoot Walker said, “The industry was not affected by the 10 per cent, reduction recently ordered by the Commonwealth Arbitration Court “. That was the statement I made, and the honorable member said I was wrong.
– I still say that the statement made by the Minister was incorrect.
– Mr. Lightfoot Walker said that the industry was not working under a federal award, and that is what I said.
Mr. ARCHDALE PARKHILL.The Minister’s interjection is irrelevant. Honorable members opposite who believe in industrial arbitration must logically accept reductions as well as increases of wages ordered by the court. Surely neither the Government nor its supporters adopt the attitude that increases of wages granted by the court are all right, while decreases are all wrong.
– That is the policy.
– It is a very unfair policy, and I cannot believe that it is the policy of the
Government. In this industry an arrangement has been made between the employers and employees under which wages are being paid that are higher than those awarded by the Arbitration Court.
– The agreement was made at a round-table conference, such as the honorable member advocates for other industries.
Mr. ARCHDALE PARKHILL.But only two parties conferred.
– There were only two sides to the table.
– It is certain that the interests of the general public were not considered in any way. The Tariff Board reported that the average wage in this industry was £6 9s. 2d. per week.
– Is that too much?
– Yes,, it is, at the present time. It is above* the ruling rate of wages.
– Has the honorable member ever made an inspection of Lysaght’s works?
– I have not.
– And would he be willing to work there?
– I would not, nor would I be desirous of working in a hundred other industries that I could name; but I submit that the Government is not justified in providing a high tariff to enable higher wages to be paid in the galvanized iron industry than are paid in other industries, particularly in view of the fact that at present we have more than 300,000 workers out of employment tramping the streets of our cities looking for a job. Many of -these men have not the chance of earning ls. a week. The honorable member for Hunter (Mr. James) cannot consistently appeal for sympathetic consideration of the workers generally while he advocates the granting of special conditions to the aristocrats of labour who are employed in this industry. The honorable member for South Sydney (Mr. E. Riley), notwithstanding his life-long association with Labour, has adopted an entirely mistaken view on this subject, as disclosed by his speech this afternoon.
Honorable members have had distributed to them recently copies of a letter written by Sir Robert Gibson, to which was attached an appendix containing extracts from the report of the secretariat appointed to investigate the problem of unemployment. This secretariat was appointed by the Scullin Government, and it is somewhat extraordinary that its views in regard to this subject are the same as my own, and entirely at variance with the views of the Government, the honorable member for Hunter, the honorable member for Werriwa (Mr. Lazzarini), and the honorable member for South Sydney. The following paragraph is taken from the appendix to tha letter : -
In dealing with wage reductions in tha various States, the secretariat points out that these have been unequal: - “The basic rate varies from £3 3s. per week of 48 hours to £4 2s. 6d. per week of 44 hours. The wage reduction in most industries fails to lower costs sufficiently to increase employment because of the high wages still paid in other industries - such as coal or iron - on which they depend.”
The very industry which we are discussing was condemned by the secretariat, because the wages paid in it were higher than the wages paid in other industries.
– Who were the members of the secretariat?
Mr. ARCHDALE PARKHILL.Mr. Gepp, chairman, the honorable John Gunn, a former Labour Premier of South Australia, Senator Daly, and other choice selections made by the Government.
– Were not some of those gentlemen first appointed by the BrucePage Government?
Mr. ARCHDALE PARKHILL.That Government had nothing whatever to do with the appointment of the secretariat to investigate the problem of unemployment. The secretariat waa appointed by the Scullin Government, and began its work with a great flare of trumpets. The appointment of it was announced as though it were something wonderful.
– A statement such as the honorable member has quoted is what I would expect from Senator Daly.
Mr. ARCHDALE PARKHILL.The honorable member was associated with Senator Daly for a long while before he found any fault with him.
– It is only fair to Senator Daly to say that the report from which the honorable member has quoted was made by the officials. Senator Daly is the Minister in charge of the secretariat.
Mr. ARCHDALE PARKHILL.The following paragraph is also taken from the document from which I have just quoted: -
The secretariat strongly urges upon the conference the necessity for reducing the cost of all works undertaken, and of spreading the employment to be given by them over as many men as possible.
That is another point which I am making. It is entirely unfair that the galvanized iron industry should be granted such protection as will enable it to pay wages in’ excess of those provided by Arbitration Court awards while hundreds of thousands of men are scratching around to find a few shillings a week.
– I rise to a point of order. I am reluctant to stem the flow of the honorable member’s eloquence, but I ask whether he is an order in making a general tariff speech on the item now before the Chair?
– The honorable member’s remarks are quite in order.
Mr. ARCHDALE PARKHILL.The view taken by the Opposition, and by all the leading economists, on this subject, is sound. Nobody but a superficial thinker could imagine for a minute that there is any merit in keeping a few people employed at wages above those granted by the Arbitration Court, while 300,000 are tramping the streets of our cities without any wages at all.
The TEMPORARY CHAIRMAN.The honorable member’s time has expired.
– As no other honorable member has risen to speak, I shall take the second half -hour to which I am entitled under the Standing orders. It is unreasonable that a limited number of men should be kept in employment in this industry at comparatively high rates of wages at the expense of other workers and the community generally. These duties are based on an application by the company and supported by its employees and the Government merely with the object of paying unfairly high wages and unduly increasing the profits of «the company at the expense of the general public. That is an unfair and unreason able proposal, and one which the members of . this committee, who are charged; with the responsibility of representing not one section, but all sections, should not support for a moment. I should now like to refer to the way in which this company carries out the numerous ramifications of its business. I understand that it produces three grades of galvanized iron which are known as “Orb”, “Guinea”, and a third grade which is unbranded. The price of “ Orb “ to distributors was £27, and that of “ Guinea “ £26, while the unbranded iron, which is produced to compete with, imported iron, was sold at £19 a ton. Immediately the new duties were imposed, the distributors in New South “Wales were informed that no further supplies of the unbranded iron would . be available, and that the price of “ Orb “ iron was to be increased to . £31 10s. a ton, which is the price ruling to-day. Presumably, no unbranded iron was available because it had been branded either “ Orb “ or “ Guinea “ iron.
– Lysaght Limited do not charge £31 10s. a ton. That is the retail price in different part’s of the Commonwealth.
– The position in Queensland is somewhat different. The mills at Newcastle manufacture a certain quantity of sheets which are classed as “ defective “, and the better quality of these are classified as “unbranded “. Soon af ter the embargo was imposed upon the importation of galvanized iron, arrangements were made that all defective sheets, and 24-gauge unbranded sheets for the Queensland market should first be offered to Brett and Company. Of course all distributors would like to obtain a proportion of these, which are quite suitable for various types of work. They are sold at very much lower prices than good sheets, and at a fair profit “to the distributors. Since the arrangement was made, Queensland distributing houses have not had an opportunity to purchase any of these sheets until Messrs. Brett and Company have made whatever purchases they desire, and I understand they have invariably taken the lot. This one firm therefore has a monopoly of the sale of this particular class of galvanized iron which is the cheapest available. It has been pointed out by those engagedin the trade that this is a source of great annoyance to other distributors in Queensland. Recently, a sale of 64 tons of 26- gauge “ unbranded “ corrugated sheets was made to Brett and Company despite an assurance given to the merchants in Sydney that all 26-gauge unbranded iron would first be offered to them on a pro rata basis in accordance with the quantity of first grade sheets’ which they purchased. These unbranded sheets are considerably better than defective sheets, and have only slight blemishes, or the outside corrugation out of alignment. When available, they are sold at very much lower prices than branded sheets. In looking for a reason for this preference being extended to Brett and Company, which has a monopoly of the sale of this type of iron, it has been ascertained from a perusal of the share register of Brett and Company that the Treasurer (Mr. Theodore) is the owner of 12,750 shares in Brett and Company.
– What company is that?
– Brett and Company, of Brisbane, who are the sole distributors of Lysaght Limited unbranded galvanized iron in Queensland.
– Has the honorable member for Warringah (Mr. Parkhill) shares in any company?
Mr. ARCHDALE PARKHILL.Not in that company.
– Does the honorable member suggest that preference has been given to this company because the Treasurer is a shareholder ?
– I am not suggesting anything. I am merely stating the facts as I am entitled to do.
Mr.Forde. - Lysaght Limited deny that any firm has been appointed its sole distributors in Brisbane.
– I am leaving the committee to draw its own conclusions. I am entitled to place the facts before the committee, and honorable members can draw their own conclusions, the same as I am doing.
– Lysaght Limited say that the contention of the honorable member for Warringah with respect to Brett and Company is absolutely untrue.
Mr. ARCHDALE PARKHILL.They cannot say that, and the
Minister can make his own speech later if he desires. We are confronted with this extraordinary position apart from the other circumstances I have mentioned: This company which has £500,000 worth of watered capital is asking for higher duties while its employees and their offsiders in this House are bellowing for wages for the employees in the industry higher than the Arbitration Court has awarded. I intend to oppose the Government’s proposal, and to support the amendment moved by the honorable member for Gippsland (Mr. Paterson).
.- We have listened to one of the characteristic speeches of the honorable member for Warringah (Mr. Parkhill) who has again found it necessary to employ the muck rake. The honorable member, bereft of any logical argument against the imposition of higher duties on imported galvanized iron imposed by the present Government, has resorted to generalities and all kinds of misrepresentations and false statements. When I was in Brisbane recently a purchaser of galvanized iron . complained to me that certain unbranded sheets had been sold to one distributor, and that he could not obtain supplies. I asked Lysaght Limited why this had been done, and I was informed that it had not appointed any one in Queensland as its sole distributor of unbranded sheets. The statement of the honorable member for Warringah is absolutely incorrect, as unbranded iron is available to any client who requires supplies. The company’s clients are all circularized as to the unbranded iron available, and any company applying for unbranded iron can obtain supplies if any are available.
– Does that apply in all States?
– I am assured that it does. The telegram I received from John Lysaght (Australia) Limited reads as follows : -
We do not sell unbranded galvanized iron exclusively to any one buyer. Our supplies of this quality are small, and arc divided, as far as possible, among distributors’.
I was informed that oneCompany engaged in manufacturing in Brisbane had applied for unbranded sheets, and that Brett and Company had also made an application. Lysaght Limited was “unable to supply either firm at the time, and Brett and Company purchased a quantity from a dealer in Sydney, and the iron was afterwards sold to its clients.
– The Minister seems to know all about it.
– As a matter of fact, a manufacturer in Brisbane waited upon me and complained that he could not get any unbranded sheets. I investigated the matter, and asked the company for an explanation. This evening the honorable member for Warringah informed me that Brett and Company were able’ to get supplies of unbranded sheets, while other firms were unable to do so. I have made inquiries, and find that there is not a scintilla of truth in the honorable member’s statement. The position was that, Brett and Company, and other manufacturers, tried to get unbranded sheets from Lysaght Limited who were unable to supply them, but Brett and Company eventually obtained a supply from a dealer in Sydney.
– Can the Minister give the name of the dealer?
– Where could they be obtained but from Brett and Company?
– Lysaght Limited have assured me that they did not confine the sale of unbranded sheets to any one firm in Brisbane. Lysaght Limited circularize their clients, any of whom can obtain supplies when they are available. The firm has its distributors throughout Australia, and its methods cannot be controlled by this Government. Lysaght Limited have business dealings with distributors throughout Australia, and I am assured that no preference is given to one distributor over another. As a matter of fact, their list price is £28 10s. a ton, and any one purchasing two tons or over, can get supplies direct from Lysaght Limited or from any of its distributors at the list price. If 25 tons or more is purchased the buyers are entitled to discounts ranging from 2^ per cent, to 7 per cent., according to the quantity purchased. I have just been informed that the dealer who sold unbranded sheets to Brett and Company was H. R. Rich and Company. That gives the lie direct to the honorable member for Warringah.
The honorable member for Warringah has also taken me to task for not adopting the Tariff Board’s report. He knows that the Tariff Board was appointed as an advisory body. Yet he says that I have no right to disregard the Tariff Board’s recommendations. He assumes that the Tariff Board should he placed above Parliament; that is absolute^ nonsense. The first Tariff Board was appointed by the Hughes Government and the present board was specially selected by the BrucePage Government. It comprises a representative of the primary producers, commercial interests, and of the manufacturers. I have no fault to find with the personnel of the board. For the individual members of the board I have the greatest re’spect, and I would not’ countenance ‘ any attack upon them; but they are an advisory body to me as Minister. When the late Mr. Pratten was Minister for Trade and Customs there was then in office a Tariff Board which had been appointed by the Brace-Page Government. Mr. Pratten, however, refused to accept the Tariff Board’s recommendations in all things. He said that all matters were for him, as Minister, to decide. He. claimed that the Tariff Board should not be made superior to the “Government and to Parliament.
– Mr. Pratten never increased the Tariff Board’s recommendations, nor did he put men on to prove the board wrong.
– Mr. Pratten contended that the Tariff Board had been appointed as an advisory body, to take evidence and to submit reports to the Minister. If the honorable member for Warringah (Mr. Parkhill) were the Minister for Trade and Customs tomorrow, he would not hesitate to disregard the report of a Tariff Board appointed by a previous administration if he considered that the Tariff Board were not right. The honorable member would not be prepared to hand over his powers to such a body; he would insist on retaining his right and that of the government of the day to formulate a fiscal policy, and not leave such matters to an outside body not responsible to the electors. It is sheer political hypocrisy to say that a government ought to accept the recommendations of the Tariff Board in every instance. Previous Ministers have refused to accept them. I remind honorable members that the Labour party went to the country with a bold protectionist policy for Australia, and it received a mandate from the electors to carry out that policy. The Government will not hand over the administration of that policy to either the Tariff Board or any other outside body.
– The Government hands it over to the manufacturers, and practically allows them to write their own ticket.
– Not at all. In 1926 Mr. Pratten appointed a departmental committee to investigate a report of the Tariff Board on the iron and steel industry. Yet, because the Minister for Trade and Customs in the present Government appoints officers to obtain additional evidence, he is condemned. The Comptroller-General of Customs was asked to select two reliable and impartial officers to carry out the investigations. He selected Mr. Cooper, one of the senior men of the department, who is a qualified accountant, and Mr. Smith, an accountant of the AuditorGeneral’s Department, both men of ability and integrity, to investigate the accounts of Lysaght Limited, to obtain all the evidence available, and to examine thoroughly the report of the Tariff Board. Those officers did their work in an able and honorable manner. I never discussed their work with them. In due time they presented a report which is of great value, because it shows that a great injustice might have been done to the galvanized iron-making industry had the investigation not been made.
The right honorable member for Cowper (Dr. Earle Page) tried to prove that the falling off in the demand for galvanized iron was due to the high price of that commodity rather than to the inactivity in the building trade, whereas the honorable member for Balaclava (Mr. White) admitted that it was due to the economic depression, and the slump in the building trade. Before there was any increase in the duty on galvanized iron, building activities had come almost to a standstill. When the bounty payable on galvanized iron was discontinued, either early this year or late last year, the price of galvanized iron increased. The right honorable member for Cowper knows that before that time there had been a great slump in building. He also knows that the reduced consumption of galvanized iron was due to the national income having fallen by about £200,000,000 per annum, and to the curtailment of loan expenditure rather than to the high price of the commodity.
The Deputy Leader of the Opposition (Mr. Latham) referred to the desirability of building up our export trade. From the number of applications which I have -received for a drawback of the duty charged on imported materials used in the manufacture of other articles for export to New Zealand and the East, it appears that manufacturers are doing their utmost to develop an export trade. The trade agreement with Canada should help in that direction. As a result of the favorable treatment which that agreement gives them, the woollen manufacturers of Australia have sent representatives to Canada and the East to seek new markets for the output of the Australian woollen mills. It is pleasing to note that their business with New Zealand is on the increase.
Honorable members opposite have contended that we cannot manufacture machinery in Australia for export. In this connexion I desire to read from a letter which I received to-day from John Heine and Son Limited, Sydney, a firm concerning which the right honorable member for Cowper had something to say-
Just recently we have sold two of our side seaming machines to a South African firm (The Mayfair Tin Manufacturers Limited, of Johannesburg), and if reference is made to customs export entries it will be found that we shipped on the 17th February last, per SS. Euripides, one side seaming machine for canister bodies.
This machine was evidently so satisfactory to this firm that we have received an order for a second one, and our COD side seaming machine will go forward to the same firm per SS. Themistocles, due to sail on the 29th September, being tlie first steamer available.
That firm is building up an export trade with South Africa, and in its efforts it will receive every assistance from the Government. The Deputy Leader of the Opposition rightly said that it is uneconomical to have the steel works at Newcastle and the works of Lysaght Limited working at only about one-third of their capacity.; The Government aims at giving to these factories, which are a credit to Australia, all the work which can be put their way. The iron and steel works at Newcastle supply the raw materials for a number of’ manufacturing industries, one of which is the manufacture of wire by Ryland’s Limited. Lysaght Limited take about one-third of the total output of the iron and steel works at Newcastle. If Lysaght Limited are forced to close their works, the price of steel rods and of the raw materials for other Australian industries will increase. Negotiations are proceeding with Stewart Lloyds for the manufacture in Australia of steel tubes. If successfully established the new industry should help the Newcastle steel works. The duty on sheet bar, which is the principal raw material used in the manufacture of galvanized iron, is £4 per ton, whereas the duty on the finished product is £5 10s. a ton. That is only a reasonable protection.
It has been said that if Lysaght Limited get this protection they will immediately reduce the wages of their employees to the extent of 10 per cent. I have received from Lysaght Limited a communication stating that the company is not a party to any application for a reduction in the wages of its employees. The workers employed in the manufacture of galvanized iron must be fit physically to stand the strain of the very hard work which they are called upon to do. The rolling of the red hot sheets of metal is work which justifies the payment of high wages. Those honorable members who complain that the wages are high could not stand up to such work for five minutes. These men are paid at piece-work rates. Never have I seen men work harder than they do.
I have waited in vain for some constructive .criticism from honorable members opposite. Not one logical argument has been put forward to show why the proposed duties should not be approved.
I am afraid that many honorable- members have not made any attempt to comprehend this question. Some who have addressed the committee have spoken with their tongues in their cheeks in an attempt to win favour with their constituents.
The speech of the honorable member for Gippsland (Mr. Paterson) contained many inaccuracies. First, he said that the list price of galvanized iron manufactured by Lysaght Limited was £29 10s. a ton. The list price is £28 10s. a ton. The manufacturers will sell to any one who buys 2 tons or more of galvanized iron at £28 10s. a ton. Although it is probably correct that the price of galvanized iron is sometimes quoted by distributors at £29 10s. a ton, the list price of Lysaght Limited is £28 10s. a ton.
– In Tuesday’s Sydney Morning Herald galvanized iron is advertised at £29 10s. a ton.
– In an endeavour to prove that the manufacturers of galvanized iron were making exorbitant profits, the honorable member for Gippsland quoted from page 9 of the Tariff Board’s report. He quoted only those portions of the report which suited his purpose when he said -
The balance-sheets and trading and profit and loss accounts of John Lysaght (Australia) Limited, the distributing company, which were obtained by the board, disclose that very high profits were being earned during the past three years. These trading results do not support the contention that such substantial reductions in (United Kingdom invoice) selling prices were necessary to enable the company to meet competition.
The honorable member read from a portion of the report which dealt with the English company and the distributing agency in Australia for imported galvanized iron.
Coming now to the question, of profits, it is well that I should emphasize that the company is making a profit of only 9s. 3d. per ton on the galvanized iron it sells. On an estimated output of 30,000 tons for the current year, that represents a profit of £13,875, which is only 1.85 per cent, on the actual cash invested in the industry, and 1.1 per cent, on an amount of £1,246,000, which includes the sum of £500,000 charged by the parent company in England for goodwill, &c. The profit made from the production of 30,000 tons represents only 1.85 per cent, on the actual cash invested. From 1921 to 1926 the company paid no dividends at all.
– That is not true.
– The dividends paid by Lysaght Limited since the inception of the company in 1901 are as follows: -
– The company paid a dividend of 5 per cent, in 1927-28.
– That is not so. The honorable member for Gippsland (Mr. Paterson) went to some trouble to show that the cost of the protection afforded this industry, as stated by me, was faulty. Had he comprehended my statement he would have realized that I assessed the cost of protection on the total amount of duty operating. He also made mention of the £500,000 included in the company’s capital account for goodwill. My statement clearly indicated that in arriving at the company’s cost of production no cognizance was taken of the amount of £500,000 referred to, nor, indeed, of any capital charge. On the subject of profits made by the company, I would again refer the honorable member to my speech wherein I quoted the conclusions arrived at by the two accountants specially detailed to make the investigation. The honorable member for Fremantle (Mr. Curtin) raised certain point’s. His suggestion that the bounty payment should be reverted to is, unfortunately, not practicable to-day, particularly in view of the present state of the national finances. Bounties are paid only in the initial stages of industry. They were never intended to continue for all time. On the subject of selling prices, as the honorable member for Newcastle (Mr. Watkins) has stated, the company makes no discrimination whatever in discounts, and it will give the same terms to any purchaser of any given quantity of galvanized iron. The honorable member for Fremantle also stated that the present tariff rates are prohibitive. Let me inform him that importations under the present rates are still taking place, and are selling at prices somewhat lower than the company’s list price. The quantities are small, but still it shows that it is possible to import galvanized iron despite the present high tariff, and that if the duty were decreased the importations would increase, and probably 1,500 men would be thrown out of work. The employment of such a large number of men at the present juncture is a’ consideration which honorable members should weigh very carefully. Another important point which honorable members seem to have lost sight of is that the Tariff Board assessed the selling price on an arbitrary output of 60,000 tons per annum, yet the production has fallen to 30,000 tons per annum, the overhead cost remaining practically the same as before. We are not entitled to allow this industry to be driven out of existence merely to meet the desiresof a few honorable gentlemen who hold briefs for certain importing interests. The men employed in this industry and at the steel works at Newcastle are the consumers of our primary products such as butter, fruit, meat, potatoes, onions, sugar, and tobacco. The honorable member for Darling Downs (Mr. Morgan), who was loud in his condemnation of this increased duty, asked me a few days ago to keep out all imported canary seed, because all the seed required for Australian consumption could be produced in his electorate. I acceded to his request, and I now ask him to be reasonable and to accede to the request of the men engaged in the iron and steel industry by giving them ample protection.
.- I should not have spoken again on this item but for the most shameful and discreditable scene that we have just witnessed. “We have had the spectacle of the Minister for Trade and Customs (Mr. Forde), the official head of the Tariff Board, the chairman of which is an official of his own department, attacking that board in a most scandalous, shameful, and degrading manner. If the Government is not satisfied with the conduct of the board, it should take its courage in its hands and change the personnel.
– I did not attack the board. I merely said that I could not accept its report.
– The Minister in attacking the board has descended to the depths of degradation. It is one of the most unsavoury tariff episodes that have occurred in the Commonwealth Parliament. What is the position? We find that for months before the embargo was imposed on imported galvanized iron, Lysaght Limited were big importers from Great Britain. The company imported 10,000 tons of galvanized iron, and then suddenly decided that unless an embargo was imposed it would close down its works. It forced the hands of this Government, and the Minister crawled on his stomach to the company. Having secured an embargo, thus preventing others from obtaining galvanized iron from overseas, the company sold at increased prices the enormous stocks that it had imported, and incidentally, made enormous profits. It was a disgraceful episode. The Minister searched the report of the Tariff Board to find something for which he could condemn it. One of his statements has been disproved by the Sydney Morning Herald of Tuesday last. In that newspaper the list price of galvanized iron is advertised at £29 10s., whereas the Minister says that Lysaght Limited is selling at £28 10s. a ton.
– Lysaght’s list price is £28 10s.
– If honorable members on the other side are not prepared to vote for the amendment of the honorable member for Gippsland, they should, at least, insist on this item being postponed until the whole of the facts are placed before the committee. Out of a sense of decency, and a desire to avoid a repetition of the shameful spectacle that we have seen to-night, they should forget their party ties and vote according to the dictates of their conscience.
.- I had not intended to speak twice on this item, but the Minister’s speech incited me to speak previously, and now his reply has incited me to speak again. He has made a special plea for this industry, but let me remind him that the f.o.b. price of gal vanized iron in England is £13 a ton, that freight, insurance and wharfage charges amount to £3 0s. 10d., exchange to £4 15s., primage duty in Australia £1 8s. 7d., and duty £5 10s., making the total landed cost £27 14s. 5d. a ton, an actual protection of £14 14s. 5d. a ton. The quotation for galvanized iron as published in the Sydney Morning Herald is £29 10s. a ton.
– That is not the price at the factory.
– The Tariff Board carefully investigated this industry. That board was set up by the Commonwealth Government to inquire into Australian industry. It has been most generous in its findings in respect of the galvanized iron industry which it says has not participated in the general sacrifice throughout Australia. We must not forget that the wool and wheat-growers have had to make tremendous sacrifices. The Government made many promises to them, and last year they were cajoled into growing more wheat. They have not received Id. benefit because of their patriotic action. In fact, 60 per cent, of the farmers do not hold an equity in their crops for this year. Yet the Government is now placing this additional burden upon those engaged in the wheat industry. If this policy continues I shall not deliver a bushel of wheat from my farm. If I have to produce at less than cost I intend to hold my wheat on the farm, and I shall do my best to persuade my brother wheat-growers to do the same. If my efforts are successful, I venture to say that within twelve months Lysaght’s production of galvanized iron will be reduced to one-third of what it is to-day.
– The honorable member wants to go on strike.
– This is a business proposition. I have a perfect right to hold my wheat on my farm if I cannot sell it at a profit. The Government has no genuine sympathy for the man on the land. It has used, as a political cry, its promise that it intends to help the farmers. The Prime Minister, twelve months ago, asked them to work harder so that we could export more wheat, but are they to continue slaving on the land for patriotic reasons only? The men engaged in the galvanized iron industry are receiving a weekly wage of £6 and over, but the greater portion of those engaged in the wheat-growing industry are at starvation point. The wheat-growers are expected to carry on at a loss so that the high standard of living enjoyed by the workers in the iron and steel industry can be maintained. The position is absurd. There should be some attempt made to bring about equality of sacrifice in this country. We should use our best efforts to assist the primary industries which the Prime Minister himself has said are the backbone of this country. The wheat-growers are entitled to a fair deal, and they have taken every legitimate and constitutional step available to them in an effort to obtain some relief. They have been long suffering. This year they have planted as big a crop as their depleted exchequers would allow. In every part of Australia they expect that, if the Commonwealth Government cannot give them monetary assistance, it will at least remove some of the burdens that are now placed upon them. To-night the committee is to take a vote on a proposal to impose greater ‘burdens on them. If it increases the tariff on this and other items that affect primary production, and thus increases the’ cost of that production, I shall have no hesitation in advising the wheat-growers of Australia to hold their commodity on their farms, and to take that action myself.
.- In a long and impassioned speech in defence of the manufacturer of this commodity, the Minister could devote only about five minutes to a reference to the workers. The honorable gentleman read from a telegram, that he had received from Lysaght Limited, stating that they are not a party to the application that is to-day before the court for a reduction of the wages of the workers; but they do not undertake that they will not be an applicant for a reduction in the future. Therefore, the position is largely what it was before that wire was despatched. According to those honorable members who are acquainted with the conditions under which the employees of this firm are working, it can at least be said of them that they are, in the opinion of those honorable members, sufficiently good. But I do not consider that any of the present-day conditions of the workers come within that category ; they have still a long way to go before they can be regarded as entirely satisfactory. Perhaps in this case they may be classed as a little better than the average. I feel inclined to adopt a neutral attitude, and to refrain, from voting; neither to accept nor to refuse to accept the word of the firm, but to await future events.
– The honorable member will be outside the chamber when the vote is taken.
– The honorable member who has interjected is the biggest bluffer and sham fighter that has ever entered this chamber. He has done nothing but sham fight in his life. He put up such a sham fight in Warringah on the last occasion that he nearly missed election. Whenever the honorable gentleman wants a fight, I am prepared to oblige him, so long as he will take the cork off the bayonet. He has never taken any action that would hurt this Government. I put it to the Minister for Trade and Customs (Mr. Forde) and the Prime Minister (Mr. Scullin), if the duties’ proposed by the Government are lowered in the terms of the amendment, will that mean the defeat of the Government? I am given to understand that it will not; therefore I call the bluff of honorable members opposite. It will make no difference to the position of the Government whether its proposal is defeated or not. If its existence is not at issue, what is the use of defeating it? Honorable members opposite are simply political hypocrites. They have brought forward an amendment to reduce the tariff on this item by £1 a ton. What does that mean to the farmer? If they are honest and believe that the farmer ought to obtain his iron cheaply, why do they not move to have the duties entirely removed ?
– That is what we say should be done!
– Then why not move in that direction?
– Simply because the matter must be dealt with in two sections.
– Does the second section provide that the duties shall be lifted entirely and that iron shall be allowed in free?
– Why not make that the issue right away?
– The Chairman will not allow us to do so.
– The honorable member is not being quite fair.
– Then the intention is. that galvanized iron shall come in absolutely free?
– Honorable members opposite have contradicted themselves. A moment ago I said that if they were honest they would move for the duty to be entirely removed, and I was told that that was to be done. Now, however, that is said not to be the case. The amendment of which notice has been given provides that the rate of duty shall be free British, 20 per cent, intermediate, and 40 per cent, general, at any time when the gross list price exceeds £25 a ton. Why stop at £25 a ton if it can be made cheaper?
– That is the recommendation of the Tariff Board.
– But honorable members opposite have been howling all day about the distress of the farmer, and saying that he cannot afford to place galvanized iron round his haystacks to keep out the mice! I asked one honorable gentleman whether he would make provision for galvanized iron to keep out rats, so that we could enclose this chamber with it.
– The honorable member would not then be able to enter.
– You would eat your way even through that. If the tariff were removed altogether, could the farmer obtain imported galvanized iron * for less than £25 a ton?
– Well, why not go the whole hog? This action is being taken by honorable members opposite merely for electioneering purposes. It is only sham-fighting and humbug. They want to be able to tell the farmer that they endeavoured to cheapen the cost of galvanized iron to him. They have not the courage to admit that they would destroy an Australian industry so that that might be done. I have heard so much political humbug in this chamber that I wonder that the people outside have not howled long ago for a destruction of Parliament. When “ guff “ such as that to which we have listened for the last two days is continued night after night, it is small wonder that parliamentary institutions stink in the nostrils of the people. There is no sincerity in the attitude of honorable members opposite. They are merely indulging in an electioneering stunt. The honorable member for Forrest (Mr. Prowse) wept crocodile tears for the farmers - because he has a few bags- of wheat to sell. He and his colleagues are thinking of the farmers’ votes, and “ pulling their legs “. The socalled United party in opposition does not include the Country party. The latter is engaged in .whittling down the tariff to a freetrade level, and the Nationalists are supporting this move as far as they dare’ without endangering their protectionist seats. The Minister has read a telegram from Lysaght Limited. I am prepared to accept that as an indication that the company does not intend after receiving increased protection from this Parliament to approach the Arbitration Court for a reduction of wages. If it does the Minister will be reminded in this chamber and elsewhere that the Government has been “ sold “ by the company. I assume that the Minister, in placing the telegram on record, has accepted it as an undertaking by the firm that it does not intend to attempt to slash wages. I tell the Minister frankly that that is my interpretation of the telegram, and I shall hold him responsible for the honouring of it. The members of the party to which I belong will not give any further protection, or support even existing duties, for the benefit of manufacturers who are inviting the arbitration courts to slash the wages of the workers.
.- I propose to say a final word about the £500,000 of watered stock which is included in the capital of the company and upon which its profits are made. - The Minister and other honorable members opposite appear to see nothing extra- ordinary in the presence of that watered capital. There would be nothing exceptional in such a payment to the parent company if all of the capital in the Australian company, or even a substantial part of it, were Australian money. The object of the British company would then be quite clear; it would be endeavouring to recover by these paid-up shares a substantial proportion of the profits earned in Australia. But the actual position is that the parent company at Bristol owns the entire interest in the Australian firm. Therefore, the issue of £500,000 worth of paid-up shares, to the parent company is not capable of any other explanation than that it is specifically for the purpose of exploiting this country through the tariff. I particularly invite the attention of the honorable member for fremantle (Mr. Curtin), whose views on the watering of capital are well known. According to the Tariff Board, the Bristol firm owns entirely the Newcastle enterprise, and, therefore, does not increase its asset by the addition’ to the capital of the Australian company of £500,000 worth of paid-up shares, whether in payment for patent rights or anything else; but this bogus capital puts the company in a very much stronger position to bargain with the Government and this Parliament for assistance. The £500,000 is intended to bolster up the amount of assistance which this Parliament may vote to the company either by bounty or duties. The members of the Labour party have thousands of times attacked the capitalistic system, and particularly the watering of capital. This is the most glaring instance of that practice which has ever come to tlie notice of the committee, and I am amazed that honorable members opposite should condone such conduct by a great firm which is a suppliant to this Parliament for assistance. The Government should insist as a first step that the £500,000 which should never have been put into the Australian company, shall be taken out of it, and that any assistance given to the company shall be on the basis of the money actually expended on the Newcastle works. If that be done, it will be found that the protec- tion already granted to the company is adequate, and that the bounty paid in the past was excessive.
.- There need be no doubt of my position. The Tariff Board when recommending the rates of duty which are indicated in the amendment of the honorable member for Gippsland (Mr. Paterson) gave to this committee expert and entirely disinterested advice. . Recognizing the relationship between the high protectionist policy and the creation of monopolies, I feel that it is desirable that some investigation of the prices charged by manufacturers who are assured of the local market by high duties is necessary. I find that due inquiry has been made by the Tariff Board respecting what is a fair price for this company to charge in Australia for galvanized iron. The board has fixed upon £25 a ton. Obviously, the duty operating at present is unnecessarily high, having regard to all the costs that are associated with the importation of galvanized iron from other countries.
– It is over 100 per cent.
– I repeat, it is unnecessarily high. I do not accept the contention of the honorable member for Werriwa (Mr. Lazzarini) that the fate of the Government is involved in this matter. I feel that individual items of the tariff ought certainly to be considered entirely on their merits, irrespective of whether the .fate of the Government is involved or not. There surely has to be a recognition that there are certain practical considerations which govern the application of any principle. I am a protectionist, but I feel that it is imposing an undue tax upon the people of Australia to grant an excessive rate of duty in favour of this company in order to give it an absolute monopoly of the Australian market, without any possibility of competition from overseas, and without any power to limit the prices charged to the Australian public.
The Tariff Board has warned us in respect of- two vital aspects of this matter ; first, that a duty of 110s. a ton is 20s. too high to admit of competition; secondly, that a fair price to the Australian public should not exceed £25. Last night I quoted the figure charged at Perth as £29 10s., with cartage added.
Although the company claims that a uniform price is charged in each State, the fact remains that telegrams despatched to the Minister regarding the prices charged are not corroborated by the list prices quoted to the actual consumers. That appears to me to be an important element in the case. If I believed that this industry could not possibly exist, fairly and reasonably, upon the same basis of protection as that given to Australian manufacturing industries generally, I should vote for the rates of duty that the company asks for, but I am not prepared to accept the ex parte declaration of any concern. “When the facts have been fully investigated by the Tariff Board; when a report is available to the committee which does credit to the board because of its comprehensiveness and restraint - a report covering practically every phase of importance which concerns the subject - I want something much more substantial than what I fear to be the somewhat partisan utterances that have been made in this chamber, before I , reject the reasoning of the Tariff Board.
I propose to-night to make it quite manifest to the honorable member for Oxley (Mr. Bayley) that when I speak upon a tariff item for the first time, I do not do so lightly, and that it takes very much more substantial contentions than those I have since listened to to make me alter my mind in the matter.
Question - That Mr. Paterson’s amendment of the proposed amendment be agreed to - put. The committee divided - (Chairman - Mr. McGrath.)
Ayes . . . . . . 25
Noes .. .. ..31
Majority . . . . 6
Question so resolved in the negative.
Amendment of the proposed amendment negatived.
Amendment (Mr.Forde’s) agreed to.
– I have a further amendment to move at this stage. The committee has decided what is to be the amount of duty, and, unfortunately, has fixed it at £1 a ton more all round than was recommended by the Tariff Board. The question still ‘ remains to be decided as to the selling-price conditions recommended by the Tariff Board as a concomitant of the duty. The board has said that £25 a ton would be a fair sellingprice to enable the manufacturing company to obtain a fair profit. On page 18 of its report the board states -
Immunity from competition may result in the maintenance of the present list price of £28 10s. per ton which the board considers excessive. The present high price not only throws an undue burden on primary producers and on the building trade, but it also checks consumption and thereby tends to maintain high costs of production. The board is satisfied that with an output of 00,000 tons per annum the company could reduce its gross list price of 26-gauge “ orb “ galvanized corrugated iron to £24 9s. 5d. per ton and earn a reasonable profit.
The Minister has gone to a good deal of trouble in an endeavour to show that, because the company is not producing 60,000 tons of iron per annum, the sellingprice recommended by the board as one capable of returning a reasonable profit to the company, should not be accepted. I point out, however, that the board in its recommendation has allowed a sellingprice of £25 a ton after having said that £24 9s. 5d. a ton would enable the company to earn a reasonable profit on a basis of 60,000 tons production per annum; That allows the company a margin of 10s. 7d. a ton over the price recommended by the board as reasonable. Surely that should, to some extent, compensate the company for the extra cost of producing a quantity of iron less than 60,000 tons per annum. A wage-earner, who is rationed, does not receive a higher rate of pay to compensate him for the shorter time he works. He must be content with the same rate of wages for the three or four day a week he works, as he would receive if he worked a full week. This company, however, will be better off to the extent of 10s. 7d. a ton than it would be if it received the price which the Tariff Board considers should return it a reasonable profit. Even if the price conditions are agreed to by the committee, the company will be permitted to charge for iron practically double the British f.o.b. price.We have been told that the British price for iron has come down to £13 a ton. According to the amendment, which I am going to move, and which is in the terms of the Tariff Board’s recommendation, the company is to be allowed to charge £25 a ton for iron, which is nearly 100 per cent, more than the price obtaining in Great Britain for similar iron. Surely that is generous treatment, On page 19 of the report appears the following paragraph - and in this connexion I remind the committee that the protective duty and primage duty on this commodity now amount to practically £7 a ton, £5 10s. ordinary duty and £1 10s. primage duty -
With a duty of £4 8s. 4d. per ton, the local manufacturing company would be overprotected on probably 80 per cent, of its production. This is a serious matter if full advantage is taken of the duty in fixing sellingprices, but it is of small consequence if such prices are based on costs of production by efficient methods and on reasonable profits. For this reason, the board stresses the importance of obtaining from the local manufacturer an undertaking that prices will bo kept at a reasonable figure. The board, therefore, considers that while the telegraphic transfer rate of exchange between Australia and London is 28 per cent, or over, galvanized iron should be admitted at the rates of, per ton, British preferential, free; intermediate, 20s.; general, 40s., or, alternatively, if the local manufacturer gives a satisfactory undertaking -
That present prices be reduced to the basis of a gross list price of £25 per ton for 26-gauge “ Orb “ galvanized corrugated iron in skeleton felt-lined cases (quantity discounts and conditions of sale remaining unaltered) ;
That prices be further reduced by an amount corresponding to any further reductions in production costs ;
That prices will not be increased except when costs of production increase ; the board considers that the rates provided should be, per ton, British preferential, 90s.; intermediate, 110s.; general, 130s.
I have endeavoured to incorporate in my amendment both the spirit and the letter of the recommendation of the Tariff Board. I move -
That the item be further amended by adding the following proviso: - “ Provided further that at any time when the gross list price, as certified by the Tariff Board, of 26-gauge Australian orb. galvanized iron, packed in skeleton felt-lined cases, exceeds £25 per ton the rates of duty shall be, per ton, British, free; intermediate, 20s.; general, 40s.”
On many occasions we have heard in this chamber of what has been called the “ New Protection “. The honorable member for Maribyrnong (Mr. Fenton) has been a strong advocate of this policy, and I remind him and other honorable members that we have now an opportunity of putting the system into operation. The honorable member may, by supporting my amendment, afford a generous measure of protection to the industry concerned, and also safeguard, to some extent, the interests of the consumers. The high duties just agreed to will raise the protective tariff to a level which is unscallable by external competition, and the manufacturers will be protected in that way; while the consumers will be protected to the extent that iron at £25 a ton will not cost them quite twice as much as the British f.o.b. price. Unless the committee is prepared, as recommended by the Tariff Board, to restrict to £25 a ton the price which may be charged by the company, it will be guilty of giving to the company a legal charter to profiteer. On page 20 of the Tariff Board’s report there appears the following : -
If prices are kept at their present level, resuscitation of demand will be retarded and output kept at a low figure. It would therefore appear to be to the ultimate interest of all concerned to expedite a return to normal demand by reducing selling prices.
I submit that the Tariff Board has shown that no injustice will be done to this company, but that, on the contrary, it will be treated very generously if this amendment is agreed to, and if it is required, as a concomitant to the enjoyment of this protection, to sell its product’ at prices not exceeding £25 per ton, and that if it charges higher prices the duties, instead of being British, 90s., intermediate, 110s., and general, 120s., should be British, free; intermediate, 20s., and general, 40s.
Question - That the amendment’ (Mr. Paterson’s) be agreed to - put. The committee divided. (Chairman - Mr. McGrath.)
Majority . . 6
Question so resolved in the negative.
Item, as amended, agreed to.
Drugs and Chemicals : Nationalization of Supplies in Federal Territory - Invalid and Old-age Pensions - Pairs in Division - War Service Homes - Maternity Allowance.
Motion (by Mr. Scullin) proposed -
That the House do now adjourn.
.- I desire to ascertain from the right honorable the Prime Minister (Mr. Scullin) whether there is any foundation for the rumour which is current in the Federal Capital Territory to the effect that it is the intention of the Government to take over the business of selling drugs and chemists’ supplies, and to introduce some form of socialization of the medical services in the Territory?
– I direct the attention of the Government to certain hardships which are occurring, but which, in my opinon, were never contemplated, in connexion with the payment of invalid pensions under the alleged financial rehabilitation plan. In one case to which I direct particular attention an invalid pension of 10s. a week, which has been paid to the son of an artisan at Port Kembla for several years, has been cancelled recently on the ground that the father is able to support the son.. When the pension was first granted the father was working full time, and receiving £11s. 7d. per day; but some time ago his wages were reduced from. £11s. 7d. a day to 16s. a day, and, under the rationing scheme applicable to his industry, his working week was reduced from six to five days. The Pensions Department has intimated that, in accordauce with the provisions of the Financial Emergency Act, the son can no longer be granted his pension. There are other conditions which may affect the matter, such as there being other children in the family over sixteen years of age - a son unable to get work, and a daughter whom the father has to keep - but the point is that, although the father’s earning capacity has been reduced by 5s. 7d. per day for five days in the week, and completely eliminated in regard to the other day, it is said that he i3 able to support his invalid son. I do not think that honorable members ever contemplated that happenings of this kind would occur under the so-called rehabilitation plan. In times like these all the financial resources of a household are mobilized to help to maintain members of families who are out of work, and it is pitiful that pensions which, have been, payable for some years should be cancelled.
Another case has been brought under my notice of a widow SO years of age, who has had her pension reduced from 35s. per fortnight to 7s. 9d. per fortnight, because she is drawing a war pension of £67 18s. 6d. per annum. The reduction of this old lady’s invalid pension to £10 ls. Gd. per annum practically robs her of it altogether. I cannot believe that honorable members understood that they were voting in favour of this kind of thing when they supported the alleged rehabilitation scheme. It appears that it is not a case of a reduction of pensions by 2s. 6d. per week, but a wholesale slaughtering of them.
– Under the regulations either a half or a whole pension must be granted; there can be no quarter pension.
– The matter seems to be governed-by regulations made under the act.
– Action is taken under the discretionary powers of the Commissioner.
– In my opinion that means under the discretionary power of the Government, acting through the Treasurer. The honorable member for Angas (Mr. Gabb) supported the plan, and he must accept his share of the responsibility.
– The honorable member for Werriwa said a few moments ago that he did not think that this was part of the plan.
– I do not think that any honorable member thought that the plan would operate in this way. When legislation of this character is under discussion in the House, there is not always time to consider the full effects of it. If these actions have been taken under regulations it is useless to say that the Commissioner is responsible. I do not believe that the Commissioner would take action of this kind on his own volition. I believe that his action has been taken under direction. Any directions of that kind must come from those who have authority over the Commissioner. I urge the Government to give earnest consideration to this matter, and, if necessary, to bring down an amendment of the act to ‘ render impossible a continuation of the present policy. Everything possible should be done to ease the hardships that are being suffered by the pensioners who have been affected by this legislation.
.- I wish to record the fact that the honorable member for Darwin (Mr. Bell) was very anxious to vote in favour of the amendments of the honorable member for Gippsland (Mr: Paterson) to the galvanized iron item in the tariff schedule, in respect of which votes were taken a few minutes ago. The honorable member attended yesterday’s sitting of the House at great risk to his health in the hope that he would be able to record his vote; but he was unfortunately taken to the hospital yesterday afternoon. It was not possible for me to arrange a pair for him on the division on the first amendment of the honorable member for Gippsland; but I am glad to say that the honorable member for Denison (Mr. Culley) very kindly paired with him so that a record could be made of his vote on the second amendment of the honor-‘ able member for Gippsland.
.- In supporting the protest of the honorable member for Werriwa (Mr. Lazzarini) concerning reductions in pensions, I also desire to bring under the notice of the Government several cases of extreme hardship which, according to the Deputy Commissioner of Pensions, have been caused by the passage of the Financial Emergency Act. Two cases in particular have been brought under my notice where special hardship has been experienced in consequence of the instructions issued by the Treasurer (Mr. Theodore) to the Deputy Commissioner. The proposals outlined by the Treasurer in his second-reading speech on the 18th June last are not embodied in the act, but because of the Treasurer’s statement the deputy commissioners, by his direction, are inflicting a severe penalty upon pensioners whose parents are in receipt of over £78 per annum. This penalty is inflicted on each individual member of the family, irrespective of age. The Treasurer stated -
Reduce standard of adequate maintenance in respect of invalid pensions as under -
Amount available for claimant’s maintenance: Pension to be paid - Up to £52 per annum, full rate; £52 to £78 per annum, half rate; over £78 per annum, nil.
After a person is 21 years of age, the parents are no longer responsible for maintenance, and in some instances pensions which have been in force for a number of years have been cancelled. In the case of Mary A. McLean, of Secondstreet, Weston, the Deputy Commissioner states -
With reference to your personal representations concerning the above named I have to say the Pensions Act provides in effect that a pension shall not be paid to a child if the parents are in reasonably good circumstances. There is no limit to the age of the child, and any action to free children 21 years and over from the section would need an amendment of the act . . . Inquiry showed the father earned at the rate of £220 per annum. He pays approximately £5 per annum interest on amount owing on his home andhas his wife and claimant dependent on him. A son aged 24 years is not allowed for. Though the circumstances of the parent cannot be considered good they are deemed to be able to support claimant. I am sorry therefore the pension cannot be restored.
For instance, it is laid down by the Pensions Department that a single man in receipt of £78 per annum is debarred from receiving a pension. If both the husband and wife are in receipt of an income of £78 per annum they are not entitled to a pension, and a child is to be debarred from receiving a pension if the total income of the home is three times £78, or £234. In the McLean case, the daughter should be receiving the pension, even under this harsh ruling, because her father is earning only £220 per annum out of which he has to pay £5 in interest on his home. If a cripple attends at a Labour bureau, and asks for the “ dole “ he is told that he cannot get it, because it -is considered that he is entitled to a pension. There are many instances in which hardships are being inflicted, and in such a way that no other government has attempted, under instructions from the Government. I am correct in saying that instructions have been issued.
– That is not true.
– I am telling the truth,and have the necessary documentary evidence to support my contention that instructions have been issued under the Financial Emergency Act to the deputy commissioners to act in this way. It is a scandal and a shame that a so-called Labour Government should adopt such an attitude, and take the pension from the incapacitated daughter of a man who is in receipt of £220 per annum. There is also the case of a Miss Rossiter whose father has been told that his income is sufficient to maintain her. No one can successfully challenge my statement that the pensioners in the two cases, I have quoted are incapacitated. If a parent were to adopt a callous attitude, and tell his daughter that he could not keep her any longer, the Government would be compelled to pay her a pension. Is that what the Government wishes? Parents will not act in this way, but are willing to share their last crust with children who are dependent upon them. Many are in absolute poverty, and in the cases I have quoted, £220 is all that is available to maintain four people. The son is only working quarter time. These cases are only two of many that I could bring forward. I hope that the Government will show some consideration to these people, and at least treat them as well as its predecessors treated them. On occasions I have criticized the previous Government for its administration of invalid pensions; but when I find a so-called Labour Government acting in this way, I feel that an apology is due to the Bruce-Page Administration.
.- I desire to referto the precarious position of many thousands of occupants of war service homes as the result of the economic depression. In reply to a question which I asked yesterday in this connexion, the Minister in charge of war service homes informed me that the matter had been referred to a sub-committee of Cabinet. “While I do not suggest that that sub-committee will not give the most earnest consideration to this matter, I am aware that in these critical days the time of Ministers is fully occupied. I doubt whether, in the circumstances, so important a subject can be adequately dealt with by a sub-committee of Cabinet, and, therefore, I suggest that an inexpensive, independent body, comprising perhaps senior departmental officers, should he set up to consider thoroughly and impartially the position of returned soldier occupants of war service homes. I recognize that the Government should not be asked to incur heavy losses in connexion with these homes; but that losses must, be incurred because of depreciation seems inevitable. Personally, I think that a re-adjustment both of capital and interest will become imperative, and that if action along those lines is taken now the loss will be less than if matters are allowed to drift.
– Have any families been evicted from these homes?
– I believe that some have been evicted; but I am concerned now particularly with the thousands of families who still occupy war service homes, but cannot continue their payments. They are seeking a definite pronouncement from the Government that at least some measure of relief will be given to them, in which case many of them who now feel disposed to give up the fight would remain in their homes and persevere with their payments in the hope of better times coming. There are about 38,000 of these war service homes, which are occupied by the very salt of the manhood of Australia. These men are returned soldiers, and nearly all of them married men with young families. They are, moreover, men of industry, capacity, and thrift. Most of them have already paid considerable sums towards the purchase of their homes. Unfortunately, large numbers of them are now unem ployed, others are rationed in their employment, while nearly all are receiving reduced incomes. As a people we were proud of our record in connexion with war service homes before the present economic depression, because the arrears then amounted to only 1 per cent. Unfortunately, inability to pay has doubled that percentage. If relief is not given promptly, I fear that many of these homes will revert to the Crown, in which case they would prove a poor asset, to say nothing of the loss to a fine body of citizens. I suggest that an announcement of the intention of the Government be made at an early date. It might not- be possible at the moment to set out specifically the Government’s intentions but a general statement would do much to allay the anxiety of the occupants of those war service homes. An independent body might assemble the case for the Government, and so expedite its consideration.
.- Seeing that we have already wasted a number of hours dealing with matters which concern employers, I feel that I am justified in asking the House to spend a few minutes considering the case of a member of the working class which I propose to bring before it.
– Order ! It is not in order for an honorable member to say that the House has wasted time.
– On numerous occasions members of the group with which I am associated have brought before the House instances of hardship which has been caused to invalid and old-age pensioners by the policy of the Government in relation to pensions. We have been told that our statements have not been borne out by the facts. Here is a case that cannot be disputed. It is that of a Miss A. M. Martin, of 8 Artlett-street, Paddington, in the East Sydney electorate. Miss Martin was in receipt of a pension for some time, but later her case was reviewed and her pension cancelled, it being contended that she no longer was permanently and totally incapacitated. I made representations to the department to -have her pension restored, and in reply I received the following letter, dated the 7th July, 1931 : -
Re Miss A. M. Martin, 8 Artlett-street, Paddington.
With reference to your personal representations concerning the above-named, I have to say a qualification for an invalid pension is total and permanent incapacity for work - partial incapacity is not sufficient.
A pension was granted in May last year on the medical evidence, which disclosed she had six months earlier several severe operations and certain organs had been removed. The Commonwealth Medical Referee certified in pensioner’s favour, but subject to a further examination in twelve months. The second examination was recently made by the samedoctor and, though still suffering from the effects of the operations, pensioner’s condition had so far improved that she was no longer qualified for a pension.
Pensioner’s earning capacity is admittedly small, but she is capable of light employment and is, therefore, not incapacitated within the meaning of the act.
I regret, under the circumstances, a pension cannot at present be restored.
Theggie, Deputy Commissioner.
The girl’s mother and the girl then interviewed me, and so convinced was I that the serious condition of the girl’s health justified a re-consideration of her case, that I suggested to the Deputy Commissioner that she should he re-examined. To my representations I received the following reply from the Deputy Commis-. sioner : -
Re Miss A. M. Martin, 8 Artlett-street, Paddington.
With reference to your personal representations, I have to advise that, as it is only five weeks since Miss Martin was examined by the Commonwealth Medical Referee, a further examination cannot at present be authorized unless, of course, she has a doctor’s certificate that her condition has become progressively worse since the departmental doctor’s examination.
Earning capacity, even though small, disqualifies for an invalid pension.
I am sorry, therefore, the pension cannot at present be restored.
Theggie, Deputy Commissioner.
It may be contended that the Government was not aware of the facts of the case, but the following letter was sent to the
Prime Minister by the mother of this girl : - 8 Artlett-street, Paddington, 15th July, 1931.
Dear Mr. Scullin, lie the case of Alice Martin, whose invalid pension was cut off and who wrote to you a fortnight ago. You kindly answered, saying that you would co-operate with Mr. Ward, our Federal member. I have had a personal interview with Mr. Ward. He has sent on the department’s letter, which I am forwarding to you. The department admit that my daughter is still suffering from the effects of her very serious operation. Only a week ago the superintendent of the Women’s Hospital, Paddington, gave my daughter a letter saying that, in his opinion, she could not work. The department say the act of the pension is for those permanently incapacitated, but my daughter is only asking for an extension of her pension till she pulls up a little of her strength, which she has lost, to be able to fight the world, as she cannot work at all now.I, her mother, who witnessed the great agony she went through after her operation, know how ill she is still, which is worrying me very much, as she has lapsed into a state of despondency. Since they have cut off her pension she knows she cannot work, and does not know what to do. Sir, surely you, who hold the highest position in Australia (Prime Minister), have a say in this just case, and can have her pension extended for another twelve months.
The Prime Minister in- turn handed the letter to me. On the 1st September the girl’s condition became so serious that the mother took her to Dr. Brennard, of Macquarie-street, who is one of the Pension Department’s medical officers. The mother stated that she was not satisfied with the girl’s condition; that she had taken a serious turn, and was suffering mentally. She said that the girl had many times complained to her that she was a burden on her, since the pension had been cancelled, and she did not propose to be a burden much longer. The mother asked the doctor to examine the girl; but he did not do so. I do not blame him, because he was probably carrying out the instructions of the Pensions Department. But he told the mother to make a fresh application to the department to have the case reviewed. That was on a Tuesday, and on the following day the girl threw herself from the cliffs at Watson’s Bay. The Government cannot dispute these facts, and the girl’s death can be laid at its door because of its policy in connexion with old-age and- invalid pensions.
– That is a false accusation.
– Had the girl’s pension not been cancelled, she would have been alive to-day. The mother stated in evidence before the Coroner, at the inquest held last Friday, that the girl had been suffering mentally because of the loss of her pension, and that she did not desire to remain a burden on her mother. I would remind the honorable member for Corangamite (M.r. Crouch) that this girl’s father paid the supreme sacrifice at the war, and that her mother was living on a war pension. One son is out of employment, and the only income of the family is the war pension. The Pensions Department cancelled the girl’s pension. The department acted in accordance with the policy of the Government, and, therefore, the Government is responsible for the death of this girl. I ask the honorable member for Corangamite- if he thinks that if the father of this family were alive he would, in view of the circumstances surrounding his girl’s death, hold the same views in regard to the rights of the citizens of Australia as he did when he enlisted. In order to give the department the opportunity of doing the only decent thing left for it to do, in view of the necessitous circumstances of _ this family, I approached the Deputy Commissioner of Repatriation and the Deputy Commissioner of Pensions, and asked them to >» meet the expenses of the girl’s burial. They said that it was not possible for them to do so. I now ask the Prime Minister to at least do the only decent thing that remains to. him to do, by paying the expenses of the girl’s burial, which the mother cannot afford to bear.
– The case made out by the honorable member for East Sydney (Mr. Ward) will stand on the facts that he has submitted. The remarks which I wish to make are of a more general character, having application to the pensions policy of the Government under the heading of what is called “ adequate- means of support,” or “ adequate maintenance.” Until the passing of the recent emergency legislation I am quite sure that honor- able members had not dealt with pensions cancelled under that heading. I myself had no knowledge of pensions being rejected on that ground, and I claim that in my electorate there are more pensioners in proportion to the number on the roll than there are in any other electorate in the Commonwealth. A number of us who were concerned about this new pensions policy approached the Pensions Department and its officials. We had a long discussion on the subject, and we were informed that, until recently, the policy of the department was not to take into consideration the wages of the lowerpaid workers in determining invalid pensions for members of a family. That policy had been followed by previous administrations. The honorable member for Hunter (Mr. James) was correct in impressing upon us the fact that this Government had, to the detriment of the pensioners, changed a policy instituted by other governments which were not considered, in the opinion of the Labour party, to be humane in their administration. That policy was not to take into consideration the wages of the lower-paid worker in determining an invalid pension. It was admitted to us that a provision to that effect is already in the Pensions Act, that discretionary power , did rest in the hands of the commissioners, but that until recently the commissioners had not altered or cancelled pensions on the ground of “ adequate maintenance in the case of lowerpaid workers.” The officers of the Pensions Department informed us definitely that, as individuals, they did not use the discretionary power in the States which they represented. In other words, the Deputy Commissioner in the State of New South Wales did not use any discretionary power. He told us frankly that his directions in regard to the new policy had come from Canberra. It is evident that the changed policy in regard to pensions has been due to the passing of the Financial Emergency Act by this National Parliament. I, and other honorable members who approached the> Pensions Department on this subject, have been forced to conclude that the policy of the Pensions Department has been changed at the direction of the Government, and that, therefore, the Government must carry full responsibility for its action. I lay the blame, not on deputy commissioners, who are doing their best, nor on the chief commissioner, but on those who should rightly carry the responsibility, namely the present Government.
The new conditions in regard to the payment of the maternity allowance provide that if the husband of a claimant has earned an income of £260 during the year prior to that in which the birth takes place, the allowance may not be made under the act. In hundreds of cases today persons who last year earned £260
Or more, are living on the dole. With the assistance of the Pensions Department, I, and my colleagues, have been able to prove the correctness of that statement, which shows how harsh is the treatment that is being meted out by the Government at the most important period in the lives of those concerned. The payments that have to be made on account of rent, food, clothing and other necessaries of the prospective mother out of the previous year’s income ought all to be considered in deciding what treatment should be extended to those unfortunate persons who are living on the dole. It can be clearly shown that they are making more than an equality of sacrifice in order that they might make their contribution towards the so-called rehabilitation of the finances of this country.
.- The Deputy Leader of the Opposition (Mr.- Latham) has referred to a rumour that is current in regard to the nationalization of druggists in the Federal Territory. I had not heard it previously, but I shall have inquiries made in regard to it.
The honorable member for Henty (Mr. Gullett) has stressed the difficulties that are being experienced by the occupants of war service homes. A committee of the Cabinet is at present investigating that particular question, and an inquiry into it will probably have to be instituted^ The Government could not make a statement in general terms at the present time; any statement would have to be specific. Some relief has been afforded by the reduction of the interest rate to 41 per cent. I know that there are some very hard cases; but I can assure the
House that every case has been, and will be, dealt with on it’s merits. The accumulation of rents in the cases of men who are unemployed or only intermittently employed is very great. If the honorable member will look through the records, he will find that the administration has adopted a very generous attitude. Generally, the position of those who are purchasing either war service or other homes is a very difficult one, and constitutes a problem that has arisen out of the existing depression. But who can say that the present conditions will continue? Properties may rise in value. The suggestion that has been made that £7,000,000, £8,000,000 or £9,000,000 should be written off an undertaking in which about £28,000,000 of capital is involved, without knowing what the future holds in store, requires a good deal of consideration.
The honorable members for East Sydney (Mr. Ward), Hunter (Mr. James), West Sydney (Mr. Beasley), and Werriwa (Mr. Lazzarini), have referred to the question of pensions. I cannot, offhand, reply to the numerous cases that they have quoted; but I shall have an investigation made by the department, and obtain a report in regard to them. I assure the House that no direction other than to administer the act has been sent out by the Government. It may be that in the administration of the act some changes have been effected and hardship has been caused. That matter will be investigated, and any amendments of the act that are found to be necessary will be brought down. “ .
In connexion with the payment of the maternity allowance, it may be advisable to consider whether the salary of the previous year ought to be taken as a guide in the cases of those who have no income at the time. That is an aspect which may have been overlooked. The honorable member for West Sydney (Mr. Beasley) said that he had never previously heard of “ adequate maintenance “ having been held against the granting of an invalid pension. That has always been the law.
– I said that it had always been the law, but that it had never been applied.
– Oh yes, it has.
– My authority for the statement is the Deputy Commissioner.
– I assure ‘ the honorable member that it has always been applied. It is perfectly true, however, that the matter is absolutely within the discretion of those who are administering the law. When times were good, the provision was most generously interpreted; but probably it has been tightened up now that we are in straitened circumstances.
– As a matter of fact, in some cases they are holding it against foster parents.
– Foster parents, of course, take the place of natural parents, f shall have an investigation made of the whole matter, to see how far it is working harshly. The Government does not wish unnecessary hardship to be imposed.
The honorable member for East Sydney (Mr. Ward) brought up a specific case, in which he said that a’ girl was refused a pension as a result of the policy of the Government. In reply to an interjection by the honorable member for Corangamite (Mr. Crouch), the honorable member said, “ I shall show you that it is an instruction from the Government “. He then proceeded to read a letter that had been sent to me, and my reply to it. The mother of . the iri in question wrote to me, and took the courteous action of replying that I would co-operate with the member for the district. I sent that letter in the name of the honorable member for East Sydney as well as in my own name, that, in my opinion, being the courtesy that 13 due to an honorable member. But beyond making those representations, I issued no instruction. I have uo power to instruct the Commissioner, nor would I attempt to do so any more than would any other honorable member. T would not use my position as Prime Minister to give an instruction in any case. The circumstances of the case as they have been outlined by the honorable member clearly prove to those who have had experience of pensions that it has no connexion whatever with the plan of rehabilitation, or with government policy; it is a case that comes solely under the law, which lays it down that an invalid must be totally and permanently in capacitated, and the judge of that is the doctor who examines the applicant.
– The doctor receives instructions from the Pensions Department, which in turn is instructed by the. Government.
– I join issue with the honorable member, and give that statement a fiat denial. The medical referees are men of high standing, who would refuse to take instructions from either the Commissioner or the Prime Minister. If the honorable member can mention a medical referee who is so lost to all sense of honour that he would act as he suggests, I undertake to have him removed.
– In dozens of cases outside practitioners differ from the department’s medical referees.
– That is quite true; I have had cases of that kind myself. I have found that outside doctors ‘ give a much more liberal interpretation of the act than do the medical referees, whose responsibility it is and whose knowledge of the’ provisions of the law is frequently considerably greater than that of many outside practitioners. In the past, we have had experience of doctors who have been harsh and cruel, a’nd they have been removed. These men have to interpret both the letter and the spirit of the act.
– And they have interpreted very generously the definition of “ totally incapacitated
– It hap been interpreted most generously.
– Does the Prime Minister think that this girl would have committed suicide had a pension been granted?
– The history of the case that has been given by the honorable member gives his own case away. The girl underwent a surgical operation on the body, not on the head, and twelve months later the doctor who originally passed her for a pension reviewed her case and declared that she was recovered sufficiently to be able to work. His original certificate had been generous, . because although at the time of his examination she was unable to work, he knew that her incapacity was not permanent. When, however, she had recovered from her operation, he recommended that the pension be discontinued. His judgment, may have been right or wrong, but it ia. not for the honorable member to say that what happened subsequently was the consequence of Government policy.
– Cold-blooded logic!
– It is not. The honorable member for East Sydney has alleged that Government policy was responsible for the girl’s suicide.
– That is true.
– The policy of the Government had nothing to do with it. The law requires that the pensioner shall be permanently incapacitated, and the responsibility of determining the incapacity attaches to the doctor. As a matter of fact, the incapacity for which this girl received the pension was in no way connected with her mental state, and when she asked for the restoration of the pension, the doctor soundly advised her to make a further application to the department. The honorable member for East Sydney does not help his case by making irresponsible charges against the Government. We are trying to be humane, and arc not giving instructions to the officials to cither tighten or slacken their administration of the law. The administration is in the hands of a Commissioner who, so far as we know, is capable and impartial, and the department endeavours to select doctors who are competent and fair. But in regard to anything that results from Government policy, I am willing to order that any deserving case brought to my notice shall be reviewed with a view to the removal of undue hardship.
Question resolved in the affirmative.
House adjourned at 11.43 p.m.
Cite as: Australia, House of Representatives, Debates, 17 September 1931, viewed 6 July 2017, <http://historichansard.net/hofreps/1931/19310917_reps_12_132/>.