13th Parliament · 1st Session
Mr. Speaker (Hon. G. H. Mackay) took the chair at 2.30 p.m., and read prayers.
– The Canberra Times of this morning publishes a cablegram from London under the headings -
Questions inHouse of Commons.
Australia BuysEastern Goods.
The cablegram refers to certain questions asked in the House of Commons of the President of the Board of Trade and the Secretary of State for the Dominions. I ask the Acting Leader of the House whether the Commonwealth Government has received any communication from the British Government with regard to this matter ?
– No such communication has been received from the British Government, and I observe that, according to the newspaper report, British Ministers replied that the matter raised by the questions was one entirely for the Commonwealth Parliament to deal with.
– I ask the Minister for the Interior whether it is not a fact that during the last five years large quantities of Newcastle tar have been used for the construction and maintenance of roads in the Federal Capital Territory with most satisfactory results?
– For a considerable period, Newcastle tar has been used very successfully for road-making purposes in (he Federal Capital Territory, and my department intends to continue its use.
– Is the Acting Leader of the House aware that the New South Wales conference of the United Australia Party on Monday last carried a resolution in favour of a 25 per cent. reduction of the customs tariff, and, if so, does the Government intend to take any notice of the resolution?
– As the honorable member knows, the Government’s policy is not controlled by any outside organization. On Monday next, I propose to deliver an address in Sydney on “ The Government and the Tariff “, and I shall then have an opportunity to deal with the subject to which the honorable member’s question refers.
– Will the AttorneyGeneral make a similar speech in Perth, and point out to the people of Western Australia the wonderful advantages of t he Government’s customs tariff policy?
– I shall be very glad to speak on that subject in any place where the audience is prepared to listen to argument.
– In connexion with the next budget will the Acting Leader of the House say what method the Government proposes to adopt to ensure continuity of Commonwealth grants to South Australia and the other smaller States?
– The honorable member speaks of “ continuity of grants “ ; but it is hoped that at some time these grants will become unnecessary. It has been generally recognized for some time that this form of assistance to necessitous States has not been based on any satisfactorily settled principle, and the Government contemplates the appointment of a competent and impartial body to advise with respect to the amount and apportionment of such grants.
– Has the Acting Leader of the House read the newspaper report of a violent attack on the Government by the Deputy Leader of the Country party (Mr. Peterson) at St. Arnaud, Victoria, recently? Is this attack likely to influence the Government?
– Even the representations of the honorable member for West Sydney (Mr. Beasley) have, on occasion, influenced the Government, and we shall certainly regard with great respect any accurate report of a considered statement by the honorable member for Gippsland (Mr. Paterson).
– The Prime Minister is reported to have stated at a public meeting in Western Australia that, but for the assistance of the. Commonwealth Bank, the trading banks must have failed during the depression. As that admission corroborates statements frequently made in this House by the Leader of the Opposition (Mr. Scullin) and other members of the Labour party, will the Government take the necessary steps to broaden the policy of the Commonwealth Bank in order that it may take its rightful place in the financial structure of Australia?
– The statement of the Prime Minister shows that the Commonwealth Bank is already occupying its rightful place in relation to Australian banking and finance. Nevertheless, the Government may consider, in the near future, the advisability of legislating in regard to some aspects of banking policy.
– Has the Minister for Commerce succeeded in his negotiations with the manufacturers of superphosphates for a reduction in the price of fertilizers to conform to the rebate of 15s. per ton, which the Government is now making to primary producers other than wheat-growers?
– The honorable member is apparently under a misapprehension. The Government was negotiating with the manufacturers for a reduction of the price of superphosphate in connexion with a major scheme to stimulate the use of fertilizers. A satisfactory arrangement had been reached; but the major scheme was displaced by a minor scheme which did not permit of such an arrangement being carried out.
– Has the Minister for Commerce any information with regard to the reported trade agreement between the United Kingdom and the Argentine? If so, will he impart it to the House?
– The Government has no knowledge of the reported agreement.
– The Acting Leader of the House is reported in the Canberra Times of to-day as having stated yesterday that the progress of the tariff discussion will determine whether the Easter adjournment of the House will be for three weeks or four weeks.
– The Government has already announced that it proposes to ask the House to adjourn from the 6th April to the 26th April. I said yesterday that if rapid progress were made with the consideration of the tariff schedule a longer adjournment might be contemplated, but the Government desires to send the tariff schedule to the Senate as early as possible.
– In view of the state ment made towards the end of last year by the Assistant Minister in charge of war service homes that soldier occupants would not be evicted, will the honorable gentleman instruct the War Service Homes Commissioner not to issue further warrants for eviction under section 30a against unemployed returned soldiers?
– A. soldier whose case is not “ hopeless “, and who pays according to his ability, is allowed to remain in possession of his home, and will have complete security until his case is reviewed in 1935. If a soldier does not pay according to his ability, definite action is taken by the Commissioner in accordance with recommendation No. 4 of the committee of inquiry which reported to the Government last year. Action to regain possession of a home is taken by the commission only when circumstances force it to.
– The Minister has just stated that action by the department will be determined by the ex-soldier’s ability to pay. What I want to know is, will the War Service Homes Commission be instructed to take no further steps, cither by sending letters of intimidation, or by action through the court, or in any other way, to dispossess a returned soldier if, through unemployment, he is unable to keep up his payments?
– I do not propose to answer any supposititious case, but I shall examine any case which the honorable member brings under my notice, and it will be decided on its merits.
” O.S. “ STAMPS.
– Will the PostmasterGeneral explain the reason for discontinuing the use of overprinted “ O.S. “ stamps and the substitution of ordinary stamps for official purposes? If the department contends that “ O.S.” stamps lent themselves to trafficking, will the substitution of ordinary stamps, which are readily converted into money, prevent that abuse?
– Considerable trafficking in “ O.S.” stamps was taking place, and the overprinting of stamps used for official purposes was not acting as a safeguard against purloining or misuse. If the second portion of the honorable member’s question relates to the stamps issued to honorable members, my reply is that I assume that their own principles of honesty will prevent them from using the stamps for purposes other than those for which they are intended.
Effect of Ottawa Agreement on Woollen Industry.
– I desire to make a personal explanation concerning certain misrepresentations in a section of the press following a question asked a day or two ago by the honorable member for Corio (Mr. Casey) based on a statement made by me in a speech at Ascot Vale, Melbourne, on Sunday afternoon last. The Melbourne Herald of the 28th March published a subleader from which I quote the following passages: -
Continuing, the article went on to state -
In face of this direct contradiction of his damaging story -
This referred to a statement made by certain mill managers in Ballarat and Geelong that they had not dismissed anybody -
Mr. Forde owes it to himself both to make public the source of his information, and to take greater care in the future over his acceptance of such statements.
I wish to explain that, on Sunday morning last, I was speaking to the manager of one of the woollen mills at Geelong, and was told by him that one mill there had, on the previous Saturday, dismissed 95 employees. That was the statement which I repeated in the course of my speech at Ascot Vale. I now have a confirmatory telegram from Mr. Scholfield, the Geelong mill manager to whom I have referred. He is the President, of the Victorian Woollen Manufacturers Association. His telegram to me is timed “ 1.47 p.m., Geelong “, and reads -
My statement to Mr. Forde that 95 persons had recently been dismissed from one of the local mills owing to a slacking-off in trade is absolutely correct. I understand this statement will be confirmed to you by wire from the manufacturer concerned.
I have also received an urgent telegram, timed “1.59 p.m., Geelong”, to-day’s date, from Mr. W.R.Redpath, Manager of the Excelsior Mills, Geelong, and exPresident of the Victorian Woollen Manufacturers Association. It says -
Your statement correct.
Having put these facts before the House, I leave it to honorable members to judge whether I. was guilty of making an irresponsible statement, or of indulging in misleading propaganda in my speech at Ascot Vale on Sunday last.
Employmentof Returned Soldiers
– Has the Acting Prime Minister any “information to give to the House in reply to a question asked by me a few days ago whether the instruction had been issued to Divisional Returning Officers that only returned soldiers were to be employed in collecting the census?
– The instructions are. contained in a booklet which has been issued to those who will be in charge of the census. I can find in them none of the nature mentioned, but, as is well known, the general policy of the Government, when providing employment, is to give preference to returned soldiers.
– Has the attention of the Postmaster-General been directed to the following statement made by Mr. M.O. Mingay, of the Institute of Radio : - “ That until the Government provides country stations with high power and long wave lengths, country listeners would not obtain satisfactory service?” In view of that statement, and in view, also, of the fact that country listeners are not getting an efficient service, notwithstanding that they pay 17s. 6d. a year for their licences, will the PostmasterGeneral expedite the installation of the necessary regional stations to give country people a satisfactory service?
Mr. ARCHDALE PARKHILL Yes.
– Since the declared policy of the Government is preference to returned soldiers, can the AttorneyGeneral say why that policy was not followed in regard to the personnel of the royal commission which has been appointed to investigate the oil industry?
– Where special qualifications are required for special work, it is not always possible to appoint returned soldiers.
– Has the Minister yet received a report from the Tariff Board regarding the duty on oregon?
– This matter has been referred to the Tariff Board, but an inquiry into it has not yet been held.
– Will the Minister expedite the inquiry?
– The inquiry is listed for attention, and will be held in due course.
Mr. SPEAKER presented balancesheets of the Commonwealth Bank and Commonwealth Savings Bank and statement of the liabilities and assets of the Note Issue Department, at 31st December, 1932; together with AuditorGeneral’s reports thereon.
The following papers were presented : -
Northern Territory -Report on Administration for year ended 30th June, 1932.
Ordered to be printed.
Appropriation (Unemployment Relief Works) Act - Regulations amended - StatutoryRules 1933, No. 35.
Customs Tariff (1932) : Special Duties (No. 4) : Primage Duties (No. 2) : Customs Duties (Canadian Preference, No.2) : Customs Tariff Amendment (No. 1) : Special Customs Duty (No. 5) : Excise Tariff Amendment (No. 3)
In Committee of Ways and Means: Consideration resumed from the 29th
March (vide page 683), on motion by Sir Henry Gullett (vide page 1167) (Volume 135)-
And on motion by Mr. White (vide page 29) -
Group 4.-Revenue items not included under any other heading.
Division 7. - Oils, Paints and Varnishes
Item 229, sub-items (b) to (e).
Oils in vessels exceeding one gallon -
.- I move -
That the sub-items be postponed.
It is most difficult to know what oils are admitted as crude oils. Paragraph 2 of sub-item b refers to “ crude petroleum, crude petroleum enriched with a distillate from petroleum, and residual oil . . .”, while paragraph 4 a has the same wording, with the exception that the words “ and residual oil” are omitted. It is difficult to ascertain under what conditions crude oil will enter Australia, and what concessions are allowed by the department. Under paragraph 2 a, “ crude petroleum . . having a recoverable petrol content of 70 per cent.” is admitted duty free under departmental by-law, whereas, under paragraph 4 a, “crude petroleum . . having a recoverable petrol contend not exceeding 70 per cent.”, is subject to a duty of 4d. and 4½d. a gallon British and general tariff respectively. In regard to the crude petroleum referred to in paragraph 4 a, it is assumed that the rates under the 1921-30 tariff were
British 3d. and general 3½d. a gallon. Will the Minister inform the committee what by-law or schedule submitted to this Parliament provided for those rates of duty? The whole division seems to require re-sorting. If we are to have refineries in Australia to refine crude oil, that crude oil should not be oil from which everything of value has been taken, after which a little petrol is poured into it, leaving only the -petrol to be again taken out of it ; what ‘ is needed is the crude oil as it is obtained from the well. Under the old tariff, crude oil was admitted duty free, because of a desire to establish refineries in Australia to treat it. That was made clear in 1920, when a bill came before this Parliament to ratify an agreement between the Anglo-Persian Oil Company and the Commonwealth for the establishment of refineries in Australia. It was pointed out then that, in the event of war,- it would be well to have refineries in Australia, so that should crude oils be found in this country we would not be dependent on other countries for our supplies of oil and petrol. Another reason then given for the establishment of refineries here was that they would provide competition, and so prevent monopolies from being created to the harm of the public. Honorable members would do well to read the speech of the then Prime Minister, Mr. Hughes, when he urged Parliament ‘ to accept that measure. It was also contended that the establishment of refineries would encourage men to search for crude oil in Australia, thus providing employment for our people, both in the search for oil and in its treatment in Australia, when found. In addition, it was pointed out that Australia would have it3 own sources of supply of the by-products of the crude oil. We should remember that, in addition to petrol and kerosene, other residual oils, as well as paraffin wax, pitch and certain other things, are obtained from crude oil. All of those products, which are of great value, are being imported into Australia to-day. The Commonwealth has invested £370,000 in the Commonwealth Oil Refineries Limited; yet a royal commission has been appointed to inquire into a petrol monopoly to which that company is a party. Although
I wish to move for the alteration of the duties under this item, I think the wisest course would be to postpone the consideration of the item to enable the department to bring in a fresh schedule, under which crude oil will be admitted free of duty. At the time the agreement relating to the Commonwealth Oil Refineries Limited was entered into, I opposed it strenuously in this chamber, because I did not believe in the State engaging in industry ; but honorable members were assured that great advantage would be derived from the establishment of these works. We were told clearly and definitely that the plant which was to be installed would treat some 200,000 tons of crude oil annually. The then Prime Minister, the right honorable member for North Sydney (Mr. Hughes), said -
We shall be ready to refine our own oil when it is found. From the 200,000 tons of crude oil, it is estimated we shall get 40,000 tons of benzine, 33,000 tons of kerosene, 0,045 tons of lubricating nil, 72,000 tons of fuel oils, 4.500 tons of paraffin wax, and 9,000 tons of pitch.
That was to be the annual production of the works of the Commonwealth Oil Refineries Limited. That company, in its reports, has stated that its plant was complete in every respect; in other words, that it was not only a cracking and skimming plant, but also a plant capable of recovering the residual oils and other products that I have mentioned. Such a plant would be of considerable value to Australia if oil were found here. Crude oil has been discovered at the Gippsland Lakes, and small quantities have been obtained. But, under present conditions, the oil cannot be treated for the extraction of residual oils and paraffin wax, although we were given to understand, when the Commonwealth Oil Refineries Limited was first established, that it would be able to extract the full values from the crude oil. No attempt has ‘been made by this company to break down the existing monopoly; in fact, as I have said. it. has become a party to it. One of the chief arguments in favour of the establishment of the Commonwealth Oil Refineries Limited was that it would prevent a monopoly in the petrol trade. The agreement definitely provided for the importation of Persian crude oils containing valuable oils, wax and pitch. Unfortunately, we have no plant with which to extract those by-products from the crude oil. Some of the actions of the Customs Department in connexion with this item have been absolutely illegal and unwarranted. It made certain tariff alterations -which, up to 1929, were not shown in any tariff schedule. Without consulting Parliament, the department decided to admit, free of duty, crude oil, less certain values, enriched with petrol. Parliament should be supreme in all tariff matters, and we should decide now whether it is to be the supreme body, or whether the Customs Department is to exercise abnormal powers. On the 25th March, 1926, the following memorandum was forwarded to the collectors of customs in the various States : -
The Collector is informed that it has been decided to classify enriched crude oil for use in the production of petroleum products by distillation as crude petroleum duty free. It should be stated that enriched crude - oil is a mixture half and ha.lf of crude petroleum as obtained from the wells and the volatile fractions obtained in the first distillation of such crude oils.
That instruction was issued without parliamentary sanction, to enable the Commonwealth Oil Refineries to carry on without erecting a plant to deal with residual values in crude- oil. The existing plant is capable of extracting only kerosene and petrol. At present, crude oil with an admixture of petrol of up to 70 per cent, is admitted, under subitem b 2, free of duty, and under subitem 4 a, subject to a duty of 4d. a gallon. British preferential, and 4½d. a gallon general. This difference was created apparently for the purpose of providing free oil for the Commonwealth Oil Refineries Limited, while imposing duties against its competitors. We can never tell when oil will be discovered in huge quantities in Australia, and in anticipation of such a discovery we should install a plant capable of extracting valuable products from the crude oil. The Vacuum Oil Company made proposals for the installation of such a plant at a cost of some £800,000 and capable, not only of carrying out the skimming and cracking processes from which the highest values of petrol can be obtained, but also of extracting other potential values such as residual oils and paraffin wax. The Tariff Board apparently viewed that proposal with disfavour, although had it been given effect, it would have meant the expenditure of a huge sum of money, and Australia would have bad one of the most efficient plants in the world. The skimming plant which is at present in operation employs from 25 to 30 men. The manager of the Vacuum Oil Company has stated, although the Tariff Board apparently does not agree with him, that the establishment of this plant would give employment to about SOO persons. Bus desire was to import, not oil enriched with petrol, but crude oil, the treatment of which would have warranted the establishment of a factory in Victoria and the employment of a large number of people; I do not know what, revenue has been lost to Australia because of the admission, duty free, of crude oil enriched with petrol. The average petrol content of Borneo crude oil is 17.4 per cent. It appears to me that, by allowing the free admission of so-called crude oil which has had certain by-products extracted from it and petrol added to it to enrich it to an extent not exceeding 70 per cent, of petrol content, we have deprived ourselves of revenue to the value of millions of pounds. This practice which, in my opinion, is entirely wrong, has been going on since 1926. If crude oil enriched by the addition of petrol is to be admitted at all, it should be described as such. I can see that it is wise for us to encourage the distillation of genuine crude oil in Australia, but I submit that it is illegal to allow the free admission of oil described as crude oil which has been specially enriched by the addition of petrol.
– Does the honorable member allege that, with the cognizance of the Customs authorities, certain oil has been admitted to Australia duty free from which some by-products have been extracted, but to which petrol has been added to bring the petrol content of the oil up to within about 70 per cent.?
– I shall read again the instruction issued by the ComptrollerGeneral of Customs (Mr. Oakley) on the 25th March, 1926, and the honorable member may draw his own conclusions. The instruction reads - lt has been decided to classify enriched crude oil for use in the production of petroleum products by distillation as crude petroleum duty free. It should be stated that enriched crude oil is a mixture half and half of crude petroleum as obtained from the wells and other volatile fractions obtained in the first distillation of such crude oils.
I do not know what has happened since that time. We all know that Persian oil is rich hi paraffin, pitch and other residuals, but the Commonwealth Oil Refineries Limited has made no attempt to extract them. In the circumstances, we should postpone further consideration of this item in order that steps may be taken to classify correctly all the oils that are admitted into Australia, and determine the duties which should be imposed upon them. We should also ascertain exactly what is being done in regard to the recovery of by-products.
– There is a good deal to be said in favour of the postponement of this item. The Government should investigate the practice under which certain crude oils admitted to Australia duty free have been enriched in the country of origin by the addition of petrol. As I understand the position, it is, broadly, that Ave charge a duty of 7d. a gallon on imported petrol and an excise duty of 5-Jd. a gallon on petrol refined in this country from crude , oil, which is imported duty free. The difference of ltd. is intended to protect or assist the refineries of Australia which extract the petrol from this crude oil. I assume that it was intended that that protection should be granted to companies engaged in the refining of genuine crude oil, and not in the refining of oil which had been enriched, in the country of origin, by the addition of petrol after other products had been extracted from it. If we continue to allow so-called crude oil, which has been enriched up to nearly 70 per cent, of petrol content, to enter Australia duty free as crude oil, we shall actually continue to give the local refineries an advantage of Hd. a gallon in respect of the petrol which they obtain from what was originally crude oil, and also an advantage of lid. a gallon on the petrol already extracted from crude oil in the country of origin, and added to tlie oil shipped to Australia as crude oil. I do not think that by any stretch of the imagination oil which, has been enriched by the addition of petrol can truthfully be described as crude oil. 1 shall therefore support the amendment in order that the whole subject may be investigated.
– There is no necessity for the postponement of this item. The distinction between paragraph 2 and paragraph 4a, of sub-item b is that paragraph 2 covers importations under the provision of the Commonwealth Oil Refineries Act, that the raw material required by the Commonwealth Oil Refineries Limited for distillation purposes shall be admitted free, while paragraph 4a covers such importations in general.
– But. can it be said that the Commonwealth Oil Refineries Limited imports crude oil when the oil which it obtains has been specially enriched ?
– All honorable members have been flooded, with letters from certain quarters alleging that some byproducts have been extracted in the country of origin from the oil exported to Australia; but no evidence has been tendered to substantiate the statement. The Tariff Board investigated, this industry very carefully in 1931, and these duties were carefully worked out at that time. The distinction that was then made between paragraph 2 and paragraph 4a of sub-item b was regarded as reasonable. The insinuation that certain byproducts have been extracted from the crude oil admitted under paragraph 2 has not been supported by any tangible evidence. The Tariff Board was perfectly satisfied with the position in 1931. In view of the fact that a royal commission has just been appointed to inquire into the operations of the oil companies of Australia, I do not think that it’ would be wise to make any alteration in these duties at present.
– Does the Minister imagine that Commonwealth Oil Refineries Limited would allow £200,000 worth of crudes to go to waste?
– The company does not permit them to be wasted. I again ask the committee not to alter the rates, because this is a substantial revenueproducing item.
– I regret that I did not hear all the Minister’s remarks on this item, because I am anxious .to know if any new phase has presented itself which makes possible the establishment of a modern oil refinery in this country. Some time ago, an effort was made by one of the major oil companies to establish such a refinery. It entered into negotiations with the Victorian Government for the purchase of land, but the present Commonwealth Government so altered the margin between the duty on refined petrol and the excise duty on petrol refined in Australia from crude oil that the company found it impossible to go on with its proposal. What margin of difference is provided in this schedule ?
– It is ltd. a gallon.
– Do I understand the Minister to say that he is prepared, to give further consideration to the matter, with a view to the margin being extended to make possible the establishment of au up-to-date refinery in Australia?
– The Commonwealth Oil Refineries Limited has its refinery near Melbourne, and the Shell Oil Company has a similar plant in Sydney.
– I am aware that the Commonwealth Oil Refineries Limited is supposed to have a refinery, but as a modern refinery it is a huge joke, because it is merely a skimming plant. This company is supposed to enter into competition with other companies; but for that purpose, it is useless to the people of Australia. The cost of establishing a proper refinery would mean an expense of £700,000 or £800,000 at least. The Commonwealth Oil Refineries Limited has not such a plant, and I heard no suggestion that it intends to bring its present plant up to date. I am satisfied that the Government is trying to do its best to assist in the development of the crude oil deposits that are known to exist in Australia, and if sufficient shale were made available to-morrow to justify its treatment, there is not a plant in Australia that would be capable of dealing with it.
– That is a matter for private enterprise.
– Of course; but why shut our eyes to the possibility of private enterprise obtaining oil from the Australian shale deposits? An opportunity occurred last year for the establishment of a modern refining plant.
– I take it that the honorable member is referring to the proposal which the Vacuum Oil Company had in hand at Port Melbourne.
– Yes. I am not aware whether that company is now prepared to proceed with the venture.
– I think that the negotiations broke down, not because of tariff difficulties, but over the matter of land purchase.
-The arrangements for the purchase of the necessary land were settled finally. The company desired the margin of protection to be left as it then stood, but the present Government reduced it from 3d. to l½d. a gallon.
– The company wanted a margin which would have given it a special advantage worth nearly £500,000 a year.
– I am anxious to ascertain the facts of the matter. When the company entered ‘into arrangements for the purchase of the necessary land, and was ready to erect buildings, it purchased material for making the foundations from the ownerof a building which was in process of demolition in Swanston-street, Melbourne. Even under the agreement between the Commonwealth Government and the Commonwealth Oil Refineries Limited, it was considered necessary to have a margin of protection amounting to 3d. a gallon in order to make the refining of oil profitable in Australia. The Vacuum Oil Company proceeded with its undertaking in a bona fide way; but when a change of government occurred, and the margin of protection was reduced from 3d. to a gallon, the company considered it inadvisable for it to go on with its scheme. I hope that the committee will see the wisdom of giving further consideration to this matter, in order, if possible, to induce some company, or group of companies, to erect a modern refinery in this country. It was provided in the agreement entered into between the Victorian Government and the Vacuum Oil
Company that if the company were permitted to purchase the land, it would refine raw material produced in Australia, as soon as it could be supplied in sufficient quantities to justify its treatment. I understand that the company is still prepared to adhere to that part of the agreement. If success some day attends the efforts being made to develop the deposits of oil shale and supplies of crude oil in Australia in sufficient quantities to meet the country’s requirements of refined oil, it will be found that the necessary refining plant is not available in Australia. An opportunity was afforded to encourage the establishment of a first-lass plant of the kind required for the refining of crude oil, and in my opinion, it was most unwise to prevent the erection of such a plant.
– Was the Vacuum Oil Company willing to put up such a plant?
– It wished to erect the most up-to-date oil refining plant in the world, and, as an Australian, I consider that it would be wise to have such a refinery established here, so that it could be used whenever the the necessity for it arose. It is nonsensical to contend that we already have an oil refinery in Australia, because everybody who knows anything about the matter laughs at the idea of describing the works of the Commonwealth Oil Refineries Limited in Victoria as a refining plant. I hope that this item will receive further consideration, with a view to the adjustment of the duties so that the margin of protection will be a little greater than 1½d. a gallon, in order that the Vacuum Oil Company, or some other company or group of companies, may be induced to go on with the erection of a. plant of a kind that ought to be established in Australia.
– I understand that the Vacuum Oil Company proposedto erect a cracking plant. As the honorable member for Melbourne Ports (Mr. Holloway) remarked, the Commonwealth Oil Refineries Limited has established a skimming plant. The Tariff Board, in a report dated the 22nd June, 1931, recommended -
That no provisionbe made in the excise tariff for different rates of duty on petrol produced by “ skimming “ and “ cracking “ respectively, or for a different rate on petrol produced by the combined process than is imposed on that recoveredby “skimming” only.
The honorable member for Wakefield (Mr. Hawker) stated that the Vacuum Oil Company wanted twice as much preference as was already given to the Commonwealth Oil Refineries Limited. That was an extravagant request, and the Government could not accede to it. Under the cover of its present protection, this company should be able to provide necessary plant as the Shell Oil Company has done in Sydney. I understand that, in connexion with the Vacuum Oil Company’s proposal, there were other considerations. From what we read in the press about the legislative measures discussed in the Victorian Parliament, the scheme was within measurable range of consummation when consideration was given to the danger that would arise through oil floating on the waters of the Yarra. The precautions that it would be necessary to take, and the subject of land values, were also discussed. Owing to a mass of complications such as that, the company did not go on with its proposals. As the Tariff Board said, there should be no differentiation in duties as between petrols refined by the skimming and cracking processes respectively. Therefore, the honorable member for Melbourne Ports cannot reasonably complain because greater encouragement was not given to the company.
.- The honorable member for Swan (Mr. Gregory) has made a serious charge, which demands an answer. He said that there was being imported into Australia, under the heading ofcrude oil, a mixture composed of pure petrol and the residual of crude oil after the ordinary petrol, kerosene, paraffin wax, tar, &c, had been extracted. If I understand the matter rightly, crude oil is the oil as it comes out of the well in its natural state, containing both petrol and the other ingredients I have mentioned. We have uses for those by-products in Australia, and we should insist that, if crude oil is admitted under advantageous conditions, it should be the crude oil containing all its natural properties. We are never likely to build up a real oil-refining industry in this country if the crude oil we import has already had extracted from it the lubricating oil, paraffin, and other by-products. After the mixture which I have mentioned arrives here, I presume that nothing can be extracted from it but petrol. Samples of crude oil arriving in Australia should be taken and analysed to determine their contents.
– Surely the Customs Department already does that.
– If the statement of the honorable member for Swan is correct, there is evidently a screw loose somewhere. The Minister has not satisfied me on this point. A serious charge of this kind cannot be brushed aside, because, if unanswered, it creates a feeling of suspicion throughout the community.
– The matter ought to be referred to the royal commission on petrol.
– That commission is to inquire only into petrol prices.It will not go into the ramifications of the industry, including the refining of crude oil. We hope that we shall eventually find well oil in Australia; but I am one of those who are very sceptical regarding the possible benefits to consumers from exploiting our shale oil deposits. I do not believe that there is any hope that petrol produced from shale deposits will ever compete with well oil. All expenditure on shale deposits is, I believe, a waste of money. That, however, is by the way. I am not content to let the item go through upon the mild assurance of the Minister. We should have a statement from him that samples of crude oil shipments are analysed from time to time to determine whether or not they are actually crude oil. If it is proved that practicessuch as that referred to by the honorable member for Swan are being indulged in, appropriate action should betaken.
.- The honorable member for Swan (Mr. Gregory) and the honorable member for Maribyrnong (Mr. Fenton) have stressed one phase of this matter - that dealing with the extraction of certain commodities from the original crude oil - and have shown how important it is that we should receive crude oil retaining all its original component parts. I am not at the moment so greatly concerned with what may have been extracted from the crude oil, as with what may have been added to it, particularly the quantity of refined petrol that may be added to it. The Minister did not touch upon the possibility of the importing companies adding refined petrol to the crude oil, and thus importing it duty free. I have been doing a little sum, which shows the extraordinary possibilities open to refining companies which take full advantage of the permission to import enriched crude oil of up to 70 per cent. petrol content. Ordinary crude oil, I understand, contains approximately 35 per cent. of petrol. Sometimes the percentage may be higher, but I understand that that is the average content. Therefore, 100 tons of crude oil should contain 35 tons of petrol, and 65 tons of component parts other than petrol. Under the provisions of the by-law, it may be enriched to the point at which it contains 70 per cent. of true petrol. At a superficial glance, it may seem that the company would be permitted to add 35 tons of petrol; but it goes far beyond that. The company could add 100 tons of refined petrol to the original 100 tons of crude oil, making a total of 200 tons, of which mixture 65 tons would still be component parts other than petrol, while 135 tons would be true petrol. That 135 tons of petrol out of 200 tons of socalled crude oil represents only 67 per cent. of the total, so it would still be admissible under this by-law. From that it. will be seen that enormous additions of refined petrol can be made and the crude oil will still come in duty free. The possibilities under this by-law are greater than would be imagined from a superficial examination. The example I have given shows that a company can obtain this l½d, a gallon advantage by resorting to the practice of importing 1 00 tons of pure refined petrol mixed with crude oil, from which the petrol can be extracted cheaply. The possibilities that are suggested warrant further inquiry being made, and for this reason I strongly urge the Government to postpone the item.
.- The Minister for Trade and Customs (Mr. White) certainly gave us one little bit of information regarding paragraph 2, under which crude oil with an admixture of petrol up to 70 per cent. is admitted under by-law duty free to the Commonwealth Oil Refineries. I presume that that is in accordance with an agreement that has been entered into. It is grossly unfair that the taxpayers of Australia should provide a large amount of the captial of this company, which, in addition, receives special concessions that are denied to other companies that are prepared to begin operations in Australia. The Commonwealth Oil Refineries has done nothing to justify such concessions. It has not destroyed any monopoly that might exist, nor erected a plant capable of treating crude oil should a satisfactory deposit be found.
It has been asked whether the crude oil that is imported has been robbed of its values before being sent to Australia. No one will believe that the Commonwealth Oil Refineries has thrown away hundreds of thousands of pounds through neglecting to recover special values contained in the crude oil that is imported. The following extract is from a speech that was made by the right honorable member for North Sydney (Mr. Hughes) on the Oil Agreement Bill : -
We shall also be able to refine our own oil when it is found. From this 200,000 tons of crude oil it is estimated that we shallget per annum 40,000 tons of benzine, 33,300 tons of kerosene, 9,045 tons of lubricating oil, 72,000 tons of fuel oils, 4.500 tons of wax, and 9,000 tons of pitch.
That was to be the annual output of the Commonwealth Oil Refineries. Taking present day prices, the value of the fuel oil, paraffin wax, pitch and other by-products, would be nearly £400,000. Even with the lessened quantity treated this company has thrown away values worth £300,000 a year if these values were not extracted before the crude was consigned to it. The department admits that crude oil, with an admixture of up to 70 per cent. of petrol may be imported by the Commonwealth Oil Refineries duty free under a by-law, while other concerns have to pay the prescribed duty.
– Does the Commonwealth Oil Refineries manufacture lubricating oil?
– No; its plant is incapable of extracting the oil. The Vacuum Oil Company put forward a proposal to erect an up-to-date plant, capable, not merely of skimming the crude oil, but also of cracking it and enabling the by-products, to which I have referred, to be extracted. The whole transaction does not look at all well. It is improper for a government to enter into a partnership of this sort, where influences can be brought to bear to enable such concessions to be made. I hope that the Government will postpone the item, so that the department may bring down a proposal to admit crude oil at a specified rate of duty, applicable to all. I am aware that gases were extracted from the Roma oil-field which were converted into petrol and used to propel motor vehicles.
– That is why it is impossible properly to define crude oil. Some of it contains up to 67 per cent, of petrol.
– Duty should be payable according to the value of the crude. I object to these arrangements being made without consulting Parliament. It was not until 1929 that any reference to the matter appeared in a schedule.
.- The debate on this item presents us with a golden opportunity to obtain from the Government’ an explanation concerning the position that is occupied by the Commonwealth Oil Refineries Limited. Some little time ago, I asked a number of leading questions in connexion with this matter, one of which was, whether a pact known as the “ White Products “ policy existed among the major oil companies, and whether, by tacit agreement, the sale of cheaper grades of oil than those supplied by the major companies was prevented in Australia. The reply furnished by the Commonwealth Oil Refineries Limited was that it knew of no arrangements for price control which in any way precluded the sales of cheaper gasoline, nor did it consider that it was being used as a “ stalking horse “. The experience of a garage proprietor named Reeves, of McLaren Vale, South Australia, does not conform with that statement of the position. In a sworn declaration made before. Mr. Fraser, J.P., he relates the following conversation that took place between him and the Adelaide representative of the Commonwealth Oil Refineries Limited: - commonwealth OIL refineries’ limited
Representative. - We understand that you are selling Golden Fleece and Punch motor spirits at a lesser price than other grades.
Mr. Reeves. Yes, that is so; and we intend to continue to do so.
Commonwealth Oil Refineries’ Limited Representative. - We will be regretfully compelled to remove the Commonwealth Oil Refineries’ Limited equipment from your premises.
Mr. Reeves. You may remove the equipment immediately.
The equipment was immediately removed, and installed on the opposite side of the street. The Commonwealth Oil Refineries Limited disclaims any connexion with the other major companies; but I am inclined to believe that it is not discharging the functions for which. .it was established, and is of no particular value to the general public. The intention was that it should exercise a check upon the major companies, yet, to-day, it and they appear to be indissolubly bound together, with the result that the interests of the public are not being safeguarded. I am hopeful that the royal commission that has been appointed to inquire into the petrol industry will settle once and for all the functions of the Commonwealth Oil Refineries Limited.
– The public wants the Government to do that.
– The sooner it is done, the better for all concerned.-
.- The question raised by the honorable member for Swan (Mr. Gregory) can properly be referred to the royal commission that is inquiring into the cost of petrol. An inquiry into costs involves an investigation of all the elements connected therewith. Perhaps the most important element is the cost of the raw material, and the cost and the method of treating it. If the Government will give the assurance that this aspect of the matter will be referred to the commission, satisfaction will be felt by honorable members. Sufficient evidence has been brought forward by the mover of the amendment to warrant such an inquiry. Honorable members do not understand how the different items of the tariff work out, and the Minister has not been able to supply the information. The terms of the schedule suggest that, from a composition of crude and distilled spirit, the companies are able to produce petrol at a cheaper rate, after payment of the excise, than would be the case if they imported refined petrol and paid the duty. If the Government is not prepared to refer the matter to the royal commission, I shall support the amendment.
.- Two points have been raised in this debate. First, there has been a direct accusation of fraud against an unnamed oil importer, the charge being that he has imported enriched petrol as crude petroleum. The second point is, that the schedule of duties for different strengths of petroleum, and of once-run distillates, has been drawn up so unscientifically as to allow a refiner in Australia, by legal means, to escape the payment of a considerable amount of duty.
The very grave accusation of fraud can be cleared up only by departmental action. As the honorable member for Maribyrnong (Mr. Fenton) has pointed out, it is a question of the committee being given the assurance that a proper analysis is taken of shipments as they arrive in Australia. It is unlikely that any evidence .would he available as to the analysis of shipments in the past that may have been entered under a wrong declaration. But when such an accusation as this is made, we have the right to expect from the Minister an assurance that imports will be very carefully supervised in the future; and I have no ground for anticipating that the honorable gentleman will withhold such an assurance.
In regard to the scale of duties, the honorable member for Gippsland (Mr. Paterson) has pointed out that, in certain circumstances, low-grade oil, heavily enriched, but below the petrol content of over 70 per cent., which carries the higher rate of duty, can be imported, and involves the payment of only a comparatively light duty.
– It would be admitted free.
– An excise duty would have to be paid on the refined spirit. The honorable member’s calcu lations are accurate and fair, but it is apparent that he has not recently read in detail the report of the Tariff Board on this subject; because, as the honorable member for Swan (Mr. Gregory) has remarked, there are cases in which a genuinely crude petroleum may have as high a petrol content as 95 per cent. ; and if petroleum which naturally contained a strength of 35 per cent. - the average of Persian Gulf petroleum - were imported and not allowed to be enriched to the same strength as a competing petroleum, it would be placed at a very great disadvantage. The Tariff Board does not suggest that any petroleum with a 95 per cent, petrol content is imported., but it says -
If it wore not for the necessity of imposing a check against the importation of crude petroleum having very high petrol content? (that known as Kettleman Hills is almost pure petrol), the board would be disposed to recommend against the imposition of any duty on crude petroleum imported, for the production of petroleum products by distillation. . . .
As has already been stated herein, the crude petroleum used by the Commonwealth Oil Refineries Limited has a petrol content of less than 35 per cent., while that of the crude petroleum used by the Shell Company of Australia is about (55 per cent., based on the result of refining Operations. Apparently, the crude petroleum which the Vacuum Oil Company Proprietary Limited proposes to use would have a petrol content exceeding 35 per cent. . .
The board pointed out that, because of the great variation of the petrol content of crude petroleum, the only method to adopt is to charge the same duty on enriched crude petroleum as on natural crude petroleum of similar strength.
– The Minister stated that the Commonwealth Oil Refineries Limited is able to import its crude petroleum free of duty.
– That is in accordance with the agreement, but the company pays excise on its product, and is not in any better position than other refineries in this regard. If the honorable members for Swan (Mr. Gregory) and Gippsland (Mr. Paterson) are of the opinion that certain aspects have been overlooked by the Tariff Board, the Minister might reasonably postpone the item in order that a further inquiry might be held, ‘ but the last inquiry was so recent as 1931, and the board has under review many matters of greater urgency, including the duties on iron, steel and wire, which would be delayed if the petrol item were referred back to it. The allegation that some crude petroleum has been admitted under a wrong description is serious, and I hope that the Minister will give the committee an assurance that all consignments will be examined and checked so that the public will have no grounds to suspect that a considerable fraud upon the revenue is being perpetrated.
.- The annual report of the directors of the Commonwealth Oil Refineries Limited for the year ended the 30th June, 1931, states -
It may bc pointed out that, although the Commonwealth Government owns over 50 per £e”t. of the shares in the company, it is incorporated as a public company, and has no privileges not enjoyed by other companies.
Excluding primage on crude oil, it pays the same duties (customs anil excise), which, during the year ending the 30th June, 1931, amounted to £340,005 4s. 6d., as well as income and other taxes.
In uninformed circles a good deal of publicity has been indulged in regarding the present price of petrol, “and in this connexion this company has not escaped criticism. It is no affair of the directors to take up the defence of those generally engaged in the oil trade, but they feel that some reference should be made indicating the trend of prices to the community in relation to facts. For this purpose it might be pointed out that, in June, 1024. when “the company commenced distributing, the wholesale price of second grade spirit was 22.f>d. per gallon, on which a duty of Id. per gallon had to be paid, equalling 2 1. :3d. less duty. To-day the wholesale price of the same grade is 21 d. per gallon, on which the duty and primage payable amount to 7 .27 3d. per gallon, making a comparative net figure of 13!725d. per gallon.
.- Before I vote on this item I should like the Minister to enlighten the committee regarding the serious statements that have been made this afternoon. The general public has been under the impression that Commonwealth Oil Refineries Limited was importing crude oil, but’ this afternoon the suggestion has been made that a large quantity of petrol is mixed with the crude oil before it enters the Commonwealth. If that is so, the Commonwealth must be losing a great deal of revenue. The Government has a representative on the board of directors, and it should take steps to clear up the allegations made this afternoon. Unless the Minister will give to the committee an assurance that, a searching inquiry will be instituted, I shall not feel disposed to vote for the item.
Mr. FORDE (Capricornia) £4.8] .- The Minister for Trade and Customs (Mr. White) has not long been in office, and he might well postpone this complicated item in order that, during the Easter adjournment he may give ii further consideration. The honorable member for Swan (Mr. Gregory), the honorable member for Melbourne Ports (Mr. Holloway), and others, have made out a good case for further investigation. I feel confident, that the rate of duty being collected by the Customs Department is that to which it is legally entitled, but the Minister should give the committee an assurance that all crude oil imported will be carefully inspected and tested, so that there can be no evasion of duty. The honorable member for Swan (Mr. Gregory) has rightly stressed the advisability of establishing up-to-date refineries in Australia. We all hope that in the near future the optimism of oil geologists will be confirmed by results, and that all our requirements of crude petroleum will be obtained from Australian wells. To that end it is important, that we have up-to-date cracking plants that will extract from the crude oil not only petrol and kerosene, but also numerous byproducts, thus giving employment to a considerable number of people. Therefore, encouragement should be given to secure the establishment of those cracking plants in Australia. I understand that a cracking plant would employ seven times as many people as a skimming plant, and would expend in treating the crude oil ten times as much a? a skimming plant. The Tariff Board’? report on crude petroleum and petrol is nearly two years old. The Minister cannot be expected to be familiar with this problem after only two hours’ discussion, and I urge him to postpone the item, investigate it carefully during the approaching adjournment, and make a considered statement to the committee when it re-assembles on all the points raised by honorable members. I am sure he desires to do justice to all sections, and. providing the revenue is not unduly sacrificed, would like to see established in the Commonwealth up-to-date cracking plants which would give the maximum employment to our people, and be ready for the treatment of Australian crude oil when it becomes available in commercial quantities. Loss of customs revenue invariably results whenever new industries are established. For example, if we were manufacturing all our requirements in woollen and cotton piece goods, upon which the Government now collects substantial revenues through the customs, there would be a loss of income from that source, but it would be offset by the wider field of income taxation and other revenue payments made possible by the employment by so many more of our people in secondary industries. With regard to petrol, the Government levies excise duties as it does on spirits, matches, and a number of other commodities, so in this case it would only be a matter of bringing the rate of excise up to a level that would permit of the establishment of uptodate refineries in Australia, and there would not be a serious loss of revenue. Any such loss would be compensated by additional employment. The Minister should adopt the suggestion to postpone the item so that he may give it further consideration, and, later, make a statement to Parliament.
.- The Minister for Trade and Customs (Mr. White) appears to be under the impression that the proposal of the Vacuum Oil Company to erect refineries in Australia fell to the ground as a result of obstacles placed in the way by the Government of Victoria.
– I said that that was one factor; the other was the Tariff Board’s report.
– The company did approach the State Government for the purchase of a site at Fishermen’s Bend, and the Government put a measure through the Victorian Parliament. It also authorized a special inquiry to determine whether the proposal would endanger the safety of the people in that locality. The Harbour Trust and other authorities were consulted, and after a full investigation of the scheme, an agreement was made for the purchase of the land by the Vacuum Oil Company. A deposit was paid, and the date fixed for the payment of the balance. In furtherance of the scheme, the Electricity Commission agreed to shift, its power mains. At this stage this Government altered the duties, and the entire scheme was dropped. Consideration of the items should be postponed so that the duties may be examined from every angle to ascertain whether or not we should encourage some other company to erect a modern cracking plant in this country. It is nonsense to suggest that such a plant is already in operation. The skimming process, which has been adopted by the Commonwealth Oil Refineries Limited, is not a’ refining operation in the proper sense of the word.
– Nobody said it was. The Tariff Board states that there should be no discrimination between a skimming and a cracking plant.
– The Minister did imply that already we have a refining plant in Australia. I contend that we have not a plant comparable with those in operation in other countries where all the component parts of crude oil are extracted and the residual offal is useless even for fuel purposes. The fear has been expressed by the Commonwealth Oil Refineries Limited that, if a modern plant were erected by another company, it would encroach upon the business of the Commonwealth Oil Refineries Limited in the sale of fuel oil. This proposal would not mean anything of the kind because, as I have stated, under up-to-date methods, all ingredients of crude oil are extracted.
It has also been alleged that the Customs Department has been defrauded of considerable revenue through the importation of crude oil. We have been told that samples, taken from the tanks of steamers at the wharfs, have disclosed that refined oil had been purposely diluted to permit of its being entered for duty as crude oil, and that the foreign ingredients were readily extracted by the simple process of sieving the product through a layer of Fullers earth. Thus it became refined oil again. I have seen samples of oil taken from oil tankers which, I was informed, had been diluted in the way described. Whether the charge can be sustained is a matter for investigation. I know it has been freely stated that the Customs Department has been defrauded of hundreds of thousands of pounds in this way, and I suggest that this matter ought to be cleared up. An inquiry might suggest the advisability of widening the margin between the duties on crude and refined oil so as to make it possible for one of the companies to erect a modern refining plant in Australia.
– Two statements have been made in the course of this discussion. One is that the duties are not uniform, and the other that the department is being defrauded of revenue through the importation of what is really refined oil under these items relating to crude oils. If honorable members will look at the schedule, they will find that it is divided up into a number of subheads. Under sub-item b 2a crude petroleum, having a recoverable petrol content not exceeding 70 per cent., the duties are free British and foreign. But let me emphasize that the resultant product from distillation pays an excise of 5£d. per gallon, as against 7d. per gallon import duty on refined petroleum, so that there is a margin for refining of 1-Jd. a gallon. Crude petroleum having a recoverable content exceeding 70 per cent., comes under paragraph b of sub-item b2, and pays od. per gallon. The resultant product also pays an excise duty of 5£d., so nobody would dream of importing crude oil having such a high recoverable petrol content for the purpose of distillation when petrol itself is imported at 7d. per gallon. Sub-item b4 deals in paragraph a with crude petroleum having a recoverable content not exceeding 70 per cent., which pays 4d. per gallon British, and 4Jd. per gallon foreign. This is for residual oil purposes, and is not intended for refining. It will be seen that it pays the same duty as residual oils, n.e.i., under item 229 (6). Under paragraph b, the British and foreign duties on crude oil having a recoverable content of over 70 per cent., are 7d. per gallon. These rates, I contend, effectively dispose of the objection that there is not uniformity in the duties.
It has been stated that the department is being defrauded of revenue through the importation of crude oil that has been enriched before it is brought here. But the honorable member for Wakefield has explained that some crude oils are rich in petrol content, being sometimes as high as 90 per cent. As it had been shown that the Shell Company’s product had a petrol content of 68 per cent, the standard was fixed at 70 per cent., which, therefore, was fair to apply to the Commonwealth Oil Refineries.
I would again emphasize that this matter is being closely supervised by the department. The classification! of enriched crude oil as crude was done by the Customs Department on the advice of the Crown Law Department, which stated that enriched crude was crude oil within the meaning of the Tariff Act. Moreover, I am informed that it is not possible to discover whether the oil is enriched, or if the high content is a natura! one. So there is a definite reason for this tariff item being worded in its present form. As a royal commission is about to inquire into the industry, and as its scope is wide enough to discover the points that have been raised in the debate this afternoon, I hope that the honorable member for Swan (Mr. Gregory) will withdraw his amendment.
.- I wish to move an amendment to subitem c, which will have the effect of exempting .from duty petroleum and shale products, naphtha, benzine, benzoli.ne. gasoline, pentane, petrol, and any other petroleum or shale spirit, for use in stationary or farm tractors. For many years, this product, when required for such uses, was admitted free under departmental by-laws. The duties on this sub-item were imposed for revenue purposes, and they now fall with extreme harshness on a considerable number of people who are in most difficult circumstances. Originally, the revenue from these duties was applied to road maintenance and road development. In more recent years, the duties have been increased, more than half of their proceeds are retained for general revenue and are now a heavy tax on all forms of motor transport. When they were first imposed, prices for our primary products were at a comparatively high level, so the tax was not such a particularly onerous one, but its unfairness, in principle, was felt nevertheless. Moreover, as the rate of duty was increased, various governments made genuine efforts to prevent the’ burden from falling upon these sections which to-day are in sore straits. Those whom this duty hits hardest are the users of power plants in agricultural pursuits and fishermen who have auxiliary engines in their boats. Both these sections of primary producers are having a particularly difficult time at present. The committee will agree that a tax on the means of production, which affects a man’s ability to earn a living, falls on him with greater harshness than does a tax upon any of the items which he purchases out of his income. It is more destructive to tax the means by which a man earns a livelihood than to lower his standard of living by imposing a tax on something which he consumes. It may be contended that horses, rather than power machines, should be used for farming. I agree that had those farmers who purchased power machines stuck to horses they would be in a much better position to-day. But it must be remembered that a few years ago there was a fairly general opinion in favour of farming on. a larger scale. In a previous Parliament, during a debate on the granting of assistance to the wheat industry, the present Acting Leader of the House (Mr. Latham), who was then Leader of the Opposition, suggested that Australians should consider the complete re-organization of their farming methods. He contemplated farming on a larger scale, with bigger implements, and more power machines. I am not suggesting that the right honorable gentleman was then offering advice to the farmers; but that he could contemplate even the ultimate change over to such a system indicates that there was a great body of opinion in favour of power farming. It must be remembered, too, that not many farms in pioneering districts have adequate supplies of water, nor are all of them protected with fences, and that in such instances the use of horses, if not absolutely impossible, is at least attended with great difficulties not associated with power farming. Even if a farmer who possessed power plants wished to change over to horse traction, his implements would have to be con verted at considerable cost, in addition to the very high cost of the horses themselves. At this time, when the farmers are facing ruin .because of the fall in the prices of their products, they cannot afford to make the change. This heavy revenue duty of 7d. a gallon falls particularly heavily on these men at this time. It is true that a great many farm tractors do ‘ not use petrol as a fuel. Even the Holt tractor, one of the most efficient of these machines, which is designed for the use of petrol, has been converted so that kerosene may be used in it. Kerosene, however, in addition to not giving the same results as petrol, causes more wear and tear. The fact remains that many of the power implements in use on farms, such as auto-headers and stationary engines, use petrol only. Farmers who use only one tractor may consume several thousands of gallons of fuel in a year. Unless they use a class of fuel which causes heavywear and tear on their machines, they must use petrol, with the result that they are mulcted in heavy taxation amounting, perhaps, to £50 or £60, or even as much as £100 in a season. I am confident that no member of this committee, irrespective of party, desires that state of things to continue. That the only obstacle to the removal of this duty is one of administration is well illustrated by a recital of the history of this duty. The duties on petrol were comparatively light until 1926. When they were then raised, petrol for use in machines and implements and appliances which did not use public roads were exempted from the tax, the exemption to be made by means of a rebate to the institution or company which originally paid the duty - the petrol importing companies. They were required to give a certificate that the petrol on which the rebate was to be given was not used in any vehicle which used the public roads. Since the companies had no control over the petrol after it had been sold, they could not give that certificate, and the exemption remained inoperative until 1929, when it was repealed. Since then the duty has been further increased. The present Deputy Leader of the Opposition (Mr. Forde) and the honorable member for Henty (Sir Henry Gullett), successively in charge of the Trade and
Customs Department, investigated this matter with, I am convinced, a genuine desire to find a means of making this rebate. On the 13th June, 1930, the then honorable member for Wannon (Mr. McNeill), asked the following questions : -
To which the honorable member for Capricornia (Mr. Forde), who was then in charge of the Trade and Customs Department, replied-
I do not think that the difficulty in relation to the two classes of petrol mentioned by the then Minister is insurmountable; what can be done with the one, can be done with the other. There remains then, only the difficulty of preventing fraud. When the honorable member for Capricornia was Minister for Trade and Customs, there was on the market a coloured petrol which made it difficult to prescribe that petrol on which a rebate would be granted should be distinguishable by its colour. I understand that that coloured petrol is not now sold, so that the difficulty which I have mentioned no longer exists. If it we’re possible to distinguish clearly between the petrol used on farms and entitled to a rebate, and other petrol used in vehicles which travel the roads, it would not be difficult to police any regulation which might be prescribed. Persons who used coloured petrol in road vehicles would run a considerable risk. A heavy penalty on the individual, and the fear of the public that fraud would lead to deprivation of the concession would provide a very strong deterrent to fraud. Of coureit would still be possible for a malicious person to put some coloured petrol into the tank of a motor car belonging to another person, and then inform the police; but instances of that nature would not be frequent, and their possibility should not prevent the Government from giving the rebates a trial. I’ emphasize that the position of the primary producers is so serious that something more than ineffective sympathy should be extended to them. I am convinced that the Minister and his officers are under-estimating their ability, as well as the integrity of th.? Australian people, when they say that it would be impossible to administer such a regulation as I have suggested. A similar law operates successfully in New Zealand, and in some of the American States. I do not believe that the peopl’e of New Zealand are more honest or more capable than the people of Australia. The New Zealand authorities do not even take the precaution of requiring the petrol to be coloured; the whole thing is done by declaration; but the position would be more easily dealt, with by having petrol of a special colour for use only for purposes to which the rebate would apply, and by the petrol companies undertaking not to sell that class of petrol without obtaining a declaration from the purchase]- that it would not be used on vehicles which travel the roads. I remind the committee that the police authorities now have to supervise the concessions which are made in respect of the taxation of motor vehicles used in primary production. If the penalty for a breach of the regulation were made sufficiently heavy, there would not be much danger of loss of revenue. We should do more for these struggling primary producers than express our sympathy with them ; we should make a determined effort to grant them some real relief. I move -
That sub-item (c) be amended by adding the following: - “And on and after 31st March, 1933 -
(1) Petroleum and shale products, viz.: - Naphtha, benzine, benzoline, gasoline, pentane, petrol and any other petroleum or shale spirit, per gallon - British, 7d.; general, 7d.
Naphtha, benzine, benzoline, gasoline, pentane, petrol and any other petroleum or shale spirit for use in stationary engines, farm tractors or implements, fishing boats, aeroplanes or other machines or vehicles not used upon public roads, as prescribed by departmental bylaws - British, free; general, free.”
I take it that the phrase, “ not used upon the public roads “ would not preclude, for instance, an autoheader from moving from one part of the farm across a road to another part, because it was classed as a farm implement. Of course, that class of machine is not suitable for road transport. I commend the amendment to the Government. I urge the Ministry to press on with some practical scheme to assist the farmers, many of whom are approaching ruin while we in this chamber are dis cussing academic questions, and extending bare sympathy to them.
– I am sure that honorable members have listened with great interest to the speech of the honorable member for Wakefield (Mr. Hawker). His amendment begins with naphtha, benzine, benzoline, andgasoline, continues in clear and plain language, and ends with the phrase, “as prescribed by departmental by-laws.” I am sure that all honorable members were waiting to hear what the departmental by-laws were to be, because it is in relation to that matter that the whole difficulty arises. I think that nearly every honorablemember - certainly all those who were in the last Parliament - have expressed themselves as being more or less in favour of some reduction of the tax on petrol used for at least most of the purposes mentioned in the amendment. But, as the honorable member himself has frankly admitted, the Bruce-Page Government introduced and placed in the tariff a sub stantially identical provision, and those who were then in Opposition were ceaselessly voluble in their complaint that no effect had been given to it. Soon afterwards, the then Opposition found themselves upon the treasury benches. Humble and respectful requests were made to them to implement their previous volubility and vociferousness ; but they found it quite impossible to work out any scheme for bringing about the desired result.
– What is done in New Zealand ?
– I shall deal with that in a moment. Thus two Commonwealth governments, belonging to opposite political parties, tried their best to develop a scheme. The honorable member for Wakefield, since he has been in this Parliament and in the Ministry, has had an opportunity to work out a scheme of by-law admission which would meet the case. I admit that I was looking forward with great interest, indeed, to the suggestion which I hoped would come from the practical mind of the honorable member; but; frankly, I was rather disappointed when the honorable member suggested that, if the Government would attack the matter with resolution and determination, and with the highest idea of its own ability, it should be able to solve the problem. I was unable to discover in the honorable member’s remarks any suggestion of a practical method of working out a way of reducing the duty. This is an important matter, not only in relation to the various industries mentioned directly or indirectly in the amendment, but also to the revenue. In that regard the following figures may be of interest to honorable members. In 1929, the quantity of petrol imported into Australia was 239,000,000 gallons, and the. revenue received £3,600,000; in 1930-31, the quantity importedwas 170,696,000 gallons, and the revenue £3,601,000. It will be observed that a considerable reduction of importations took place, but the revenue was almost the same as in the previous year, because of the increase of the rate of duty. In 1931-32,the quantity imported was 156,026,000 gallons, and the revenue received,£4,763,000. The quantity of petrol distilled in Australia is not known for 1929-30, but in 1930-31 the quantity distilled was 19,500,000 gallons, and the revenue received, £315,000. In 1931-32, the quantity distilled was 19,000,000 gallons,’ and the revenue received, £328,000. A remission of Id. a gallon oi the whole of the imported petrol would mean, on last year’s figures, a loss of revenue of £650,000, and a remission of Id. a gallon in excise would mean a loss of £79,167. It has not been possible to make any estimate of the quantity of petrol used for the purpose to which reference has been made in the amendment of the honorable member, but it’ is quite possible that the adoption of the amendment, if a scheme could be worked out to give effect to it, would involve a loss of revenue of £1,000,000 or thereabouts.
– The Attorney-General (Mr. Latham) would not suggest that onequarter of the total quantity would be used for that purpose?
– I am giving the judgment of those who know better than 1 do. I myself would have though that the loss involved would be more like £500,000. But it is a substantial sum whichever way we look at the matter, and the point is that it is an unknown sum. We can only speculate on this subject. The petrol duty serves two purposes. It obtains money for roads and money for the ordinary services of the Commonwealth. In most countries of the world, petrol taxation is imposed for similar purposes. Of the duty of 7d. a gallon on imported petrol - motor spirit - 2Jd. is paid to ‘the States in accordance with the Federal Roads Act, and of the excise on locally distilled spirit of 5£d. a gallon lid. is paid to the States, the amount in 1931-32 being £1,500,000, and in 1932-33, £1,342,000. Up to the present, the argument for a remission of tax to certain non-road-users of petrol has been that they should not be charged a road tax, that the users of launches, aeroplanes, stationary engines, and the like,, which do not use the roads, ought not to be charged with what is, in effect, a road tax. Up to the present, the idea has rather been that the amount of the duty representing road tax should be taken off the price of petrol used tin non-road-using machines, but the amendment suggested by the honorable member, ‘goes much further than that. It suggests the removal of the whole of the duty from petrol used for this purpose. That proposal is not based upon the arguments which we have been accustomed to hear in this chamber as to the unfairness of making the user of an aeroplane, for example, contribute part of the road tax. It must be accepted that this proposal involves a considerable sum. If the loss were £1,000,000, it would represent about 20 per cent, of the amount of import and excise duties collected, but, whether the loss would be £1,000,000 or £500,000, a large amount is at stake, and far more than the sum involved in any previous suggestion. The balance of the duty over and above the road tax is for revenue. The necessity for obtaining revenue is admitted, I think by all honorable members. It must also be admitted that it is as fair a way of obtaining revenue as any other. No one who has to pay any particular form of taxation is enthusiastic about it, but it is rather difficult to suggest that petrol, however used, is not a fair item for revenue taxation.
– Would the AttorneyGeneral suggest that a tax on other forms of power, such as coal and electricity, would be a fair form of taxation ?
– Petrol is a particularly convenient article to tax, and it is taxed in every country in the world. It has never been contended that it is an unfair subject-matter for taxation. If, as the honorable member has suggested, petrol used for power were not taxed, then the whole of the tax, not merely that portion of it applying to aeroplanes, agricultural machinery, and the like, would be wiped out. The argument that we should not impose a tax upon petrol because it is used for power is impossible, and no responsible assembly could accept it’. Various attempts have been made to work out, at least, an exemption to the extent of what is called a road tax, but the difficulty is to arrive at a practicable scheme. Theoretically, we can devise .a scheme under which everybody .using, petrol for the purposes mentioned may, . by making a statutory declaration, claim and be paid a rebate.
– How many policemen would be required to police that scheme?
– It would require many policemen. People could not, and would not, keep accurate records of the quantity of petrol put in the car, and the quantity put into the stationary engine. They would keep no record as to when they used petrol and when, they used kerosene. They would make a guess at the quantity, and the scheme could not’ possibly be administered. It is quite impracticable.
The suggestion has been made that the scheme could be policed by the oil companies, and that they should sell petrol only to people who would swear that they would use it for certain purposes, and would subsequently swear they had used it for those purposes, but that suggestion cannot be adopted, because the oil importers are not prepared to undertake the tremendous labour and responsibility that it would involve, and the Commonwealth Government has no power to compel them to dp so. I ask honorable members to consider also the impracticability of administering such a scheme when the duty on imported petrol is 7d. a gallon, and on locally-refined petro] 5$d. a gallon. Once these petrols are put on the market it is impossible to distinguish between them. They become one for all practical purposes immediately they are taken out of the tins or the bowsers. Scientists might be able to distinguish between them, but ordinary citizens or police officers or inspectors could not do so. Another difficulty is that, although the rebate on the local commodity would be 5½d. a gallon, and that on the imported’ article 7d. a gallon, the petrols are sold to the public for substantially the same price.
– That difficulty could be overcome by making the rebate in each case.
– The honorable gentleman’s observation only emphasizes the impracticability of the proposal made by’ the honorable member for Wakefield. Surely every one must see the difficulty of administering such a scheme, in view of the fact that the petrol goes into the hands of. scores of thousands’ of. people throughout the country. . How could we rely oh people furnishing, an accurate return of the purposes for which they use petrol bought for, say, ls. 5d. a gallon, and petrol bought for 2s. a gallon? It might be possible to obtain reliable returns from honest people, but what about the others, and what about the large number of people who, though desiring to be honest, would give themselves the benefit of any doubt? A system of this description could not be administered successfully by any Federal or State Government. The Federal Government could not administer such a system, even if tinted petrols were used, for it has no legislative power to control the use of petrol. It is quite true that, under customs by-laws, petrol may be admitted under bond that it will be used for a certain purpose. But the people who import the petrol arc not the users of it. It was found possible for some time to operate a system of rebates in respect of petrol used by certain rubber and aviation companies, but they were very few and their operations could he thoroughly controlled and inspected. But no modification or adaptation of our customs by-law machinery could make such a scheme applicable to the scores of thousands of persons throughout the Commonwealth who use petrol. Under our customs law a bond or security can be exacted from importers that certain materials they import will be used in a particular manner; but it is only possible to administer such a scheme when a careful check can be kept on the’ use of the material. That by-law method is at present in operation in relation to various articles and commodities imported for manufacturing purposes; but the businesses concerned are relatively few and controllable. That would not be the case with the users of petrol.
– I suppose there would be 500,000 users of petrol altogether.
– There would certainly be :some hundreds of thousands of them. It would not be- possible, under our. customs law to obtain bonds from all of them. And think of the absurdity of demanding bonds respecting the use of unidentifiable petrol. Such a system could not be operated by any government. A State Government .could legislate to make it an offence to Use green or pink or red petrol in a motor, can, .or in a particular manner, but this Parliament could not do so. It cannot legislate to control the use of petrol in any manner. New Zealand has a unified form of Government, with
One parliament, which has complete and full power, and so a procedure of this description can be operatedtosome extent in that dominion. Senator Massy Greene, a member of this Government, is at present in New Zealand. Some time ago he was asked to make inquiries while he was there into this very subject, and he will do so. When he furnishes his report the Government will give it the most careful consideration. Systems for controlling the use of petrol have been tried in the United States of America and abandoned. During a period when three successive governments have been in office in the Commonwealth, of one of which the honorable member for Wakefield (Mr. Hawker) was a member, frequent attempts have been made to devise a system to control the use of petrol, hut they have failed in every case. The honorable member, in moving his amendment, has merely appealed to the Government on hypothetical grounds. He has not submitted any concrete proposal. The Government is prepared to do what it can to give effect to his wishes, and is obtaining the fullest possible information On the subject, and if he or any other honorable member submits a workable proposal, the Government will consider it carefully. But it is undesirable to put into the tariff schedule a provision which is illusory. I know that a provision of this kind was in the tariff schedule previously, but, as honorable members know, it was unworkable. It was provided, formerly, that petrol for use in agricultural machines, stationary engines, aeroplanes, launches and the like, should be free of duty; but it was never found possible to apply that provision. The Government is not prepared to accept this proposal so long as it remains illusory and imprac- ticable.
We believe that it would be a mistake to restore this provision to the tariff until a workable scheme has been devised. When thisprovision was previously in the tariff, the present Deputy Leader of the Opposition (Mr.Forde), who specialized on this subject, ashespecializesonmany other subjects, showed much pertinacity in asking the Minister for Trade and
Customs to put it into operation. During that period, not a week went by when Parliament was in session without the honorable member asking the Minister for Trade and Customs when the concessional petrol item would be put into operation for the benefit of the farmers in order that they might be relieved of this incubus, or octopus, or burden. The unfortunate Minister for Trade and Customs could only say on every occasion, “ I am doing my best.” Yet, every week the Deputy Leader of the Opposition came at him again. When the honorable gentleman himself became Minister for Trade and Customs, we, being kinder and of a more sympathetic disposition and character, asked him questions on this subject only about once a fortnight, hut we discovered that he could do no better than his predecessor in office. Since this Government has been in office, it has tried to discover a practicable scheme, within the legislative power of this Parliament, to give effect to this proposal, and it has failed. We want to do what we can in this direction, but, so far, no way has been discovered . by which we can do anything. If honorable members insist on the insertion of this provision in the tariff, they will do an ill-service to those whom they desire to help. I feel that the farmers will think that they have been deceived by thisParliament.
– They are getting accustomed to being deceived.
– The honorable member may have done something in that lit . but I have never done it, and I donot know why he should have made that interjection while I am speaking.
Mr.Nairn. - I had in view the volte face on the tariff.
– General observations of that description do not assist in a de- bate on a . particular item. The volte face exists only in the imagination of the honorable member. If he, or the mover of the amendment, or any ‘other honorable gentleman, will outline a scheme by which the objective they have in mind can be achieved, the Government will carefully and sympathetically consider it, but, in the meantime, I ask the committee to reject the amendment. If it is agreed to, the. farmerswillbe justified inbe- lieving that they have been deceived by this Parliament.
.- If the honorable member for Wakefield (Mr. Hawker) would, amend his amendment in order to limit it to petrol used in farm machinery, he would overcome one of the most formidable objections that the Acting Leader of the Government (Mr. Latham) has offered to his proposal. Aeroplanes and fishing launches are minor considerations when compared with the machinery of the wheat-farmers.
– But fishermen have to live.
– I recognize that the honorable member for Melbourne Ports (Mr. Holloway) represents a community interested in seafaring, but the really urgent consideration is that help shall be given to the wheat-farmers who have lost1s. a . bushel on every bushel of wheat produced during the last season. The Acting Leader of the Government opposed this proposal on two main grounds. He said, in the first place, that it was impracticable, and secondly, that it would result in a loss of revenue. He estimated the loss of revenue as anything between £1,000,000 and £500,000, but it might also be less than £500,000. As to the impracticability of the scheme, I remind honorable members that the mover of the amendment said that it was actually in operation in New Zealand. The Acting Leader of the Government was asked, in the course of his speech, why the scheme could be operated in New Zealand and not in Australia, and all he said was that Senator Massy Greene, who was in New Zealand, was inquiring into this subject among others, and would bring back a report upon it which the Government would consider in due course.
– He said that it was simpler to operate the scheme in New Zealand, because that country had a unified form of government.
– That is so. The right honorable gentleman raised the legal objection that the Commonwealth Government had no power to legislate in regard to the use of coloured petrol; but I have never known an occasion on which the, State parliaments have refused . to, pass legislation that would., benefit the States. Surely the Ministerrealizes that the States would unanimously pass the measures that might be required to enable coloured petrol to be supplied to primary producers, if that were a practicable way to grant the assistance that they require.
– There are other difficulties.
– No others were mentioned by the Leader of the Government. I maintain that, if it is practicable to give this relief to the farmers of New Zealand, by providing them withcoloured petrol, a similar system could be adopted in Australia. I am not prepared to say how much assistance the farmers are now getting under the tariff, because that help is of an illusory character. We must not. ignore the importance of making it possible for the farmers to remain on their holdings; we should not kill the goose that lays the golden egg. I am afraid that, unless assistance is speedily forthcoming, onethird of the farmers will be driven off the land within a year, and will be forced to take the dole. Is the Government prepared to postpone this item until means of granting the assistance contemplated under the amendment submitted by the honorable member for Wakefield have been examined?
We are told that, in many cases, tractors designed to be propelled by means of petrol are being operated by means of kerosene, which is highly detrimental to the engines. As a matter of fact, within the last twelve months many fires that have occurred in farming districts have been traced to the use of kerosene in tractors designed to burn petrol. The cylinders have fouled through the use of kerosene, and the. burning of the carbon has caused the fires. If the Government has no stronger objection to the use of coloured petrol than the argument that the scheme is impracticable, although it has been found workable in New Zealand, the committee should support the amendment.Revenue will be lost in any case, because the farmers will have to return to theuss of horses. They would have done that long ago, if it had been possible for them to purchase horses; but they are perseveringwith machinery, . that is out of date,because goodfarmhorsesarenot now procurableunderanaveragepriceof £45 each. Farmers hope that, when the price of wheat rises, they will be able to scrap their obsolete tractors and buy horses. Therefore, the Government ought to make the farmers’ petrol cheaper than it is to-day. The men on the land have been experimenting for years with producer gas, in order to obtain a cheaper fuel; but there are many serious objections to the use of gas produced by burning charcoal and wood, and one is the danger of fire. I hope that the honorable member for Wakefield will adhere to his amendment, and that the representatives of the farmers in this chamber will support him.
.- It is true that the amendment submitted by the honorable member for Wakefield (Mr. Hawker) goes further than proposals put forward on previous occasions. This fact was emphasized by the Attorney-General (Mr. Latham), when he said that, on previous occasions, al! that had been suggested was that a rebate of the amount of the petrol tax that is used for road purposes should be made. Until quite recently, the situation which obtains to-day did not arise. No very large revenue tax, as distinct from road tax, was imposed on petrol until recently. During the regime of the Bruce-Page Government, the total petrol tax amounted to 3d. a gallon, of which about 2½d. a gallon went to the States for road construction, and only d. a gallon, or thereabouts, was left for the ordinary revenue purposes of the Commonwealth. Therefore, the question of the wisdom of raising large sums of revenue by means of a tax on petrol used for power purposes did not arise until quite recently. When Mr. Theodore was Treasurer in the Scullin Government, he had an additional tax of Id. a gallon imposed on petrol, bringing the total tax up to 4d. a gallon. With that increase, about 2½d. a gallon was devoted to road expenditure, and about 1-Jd. a gallon went into revenue, so that the direct revenue gain was growing. More recently still, an additional 3d. a gallon was imposed for purely revenue purposes, the tax now .being 7d. a gallon, the ; amount going, to roads, namely, 2£d. a gallon, feeing, the same, but 4£d.-, a gallon /[goes into revenue, instead of id. a gallon, as during the time of the Bruce-Page Government. Therefore, at the present time, nine times as much of this tax goes into revenue, on the basis of pence per gallon, as during the term of the Bruce-Page Government. Thus a position has arisen within recent years which needs to be examined and dealt with, a position which did not exist a few years ago. The proposal of the honorable member for Wakefield is justified, because the revenue collected from this source is now much greater than it formerly was.
The Attorney-General said that the honorable member had made no suggestion of any kind as to how his scheme could be carried out. Perhaps he did not put forward any absolutely new suggestion; but he did submit one which has been proposed on many occasions, and which I am not yet convinced is unworkable. He suggested the use of a coloured petrol for purposes other than the propulsion of vehicles used on the roads, and the imposition of an exemplary fine if the coloured petrol were found in the tank of a road vehicle. I have yet to be convinced that any great loss of revenue would occur if that system were put into operation. It is successful in New Zealand, without even the safeguard of requiring coloured petrol to be used by non road users, and, surely, if we provided that extra safeguard, the revenue would be reasonably well protected. The honorable member pointed out the desperate position of those engaged in primary industries who are using petrol, in some cases, because they must continue to operate machinery which they bought when times were better than now, and which to-day, probably, they regret ever having purchased. They are compelled to go on using that machinery, because they cannot afford to buy horses. Surely these men deserve some . consideration, in view of the extremely low prices that they are receiving for their produce. If there is one section of :the community that deserves a rebate on what is purely a revenue tax, it is the section to which I have referred. That this scheme cannot be put into operation because it is impracticable -has not yet been satisfactorily demonstrated. Are we. justified in exacting 4Ad. a gallon for revenue purposes from men who are, not merely on the verge of bankruptcy, but who, in many cases, are really bankrupt, and are only able to continue operations because, if their creditors put them out, they could do no better than by leaving them where they are? That is the position of many who are using petrol to drive agricultural machinery to-day.
The Attorney-General raised a practical difficulty in the differentiation in taxation between petrol refined in Australia and that imported as petrol. The duty on the latter is 7d. a gallon, and the excise duty on the former is 51/2d. a gallon. The Attorney-General asked how that difficulty could be got over, and how, for example, we could, rebate 7d. a gallon on petrol that had been refined locally, and on which a tax of only 51/2d. a gallon had been paid. I believe that the honorable member for “Wakefield would be reasonably well satisfied if the Government would grant a rebate to the extent of51/2d. a gallon all round. That would overcome the difficulty. On imported petrol a tax of 11/2d. would still be collected, but the whole tax on locally-produced petrol would ‘be rebated.
– That would represent an immense sum, nevertheless.
– I admit it, but the Minister should realize that a substantial part of this money - and the exact figures might be obtained from the oil companies - is being paid by people who are practically- bankrupt. I do’ not think that the problem is impossible of- solution; my own opinion is that the use of coloured petrol, and the imposition of a few exemplary fines on those who used the coloured petrol without authority, would provide a practical solution.
– Will the honorable member say what authority would inspect the petrol used?
– There would be difficulties in administration, but I do not believe that there is so little possibility of co-operation between the Commonwealth and State Governments that the States would refuse to permit the police to add to their present duties that of occasionally stopping motorists and- examining the petrol in their tanks,- just as they now require a driver to produce his licence.
– If the honorable member knew how hard it is to obtain cooperation among the various governments of Australia in the administration of federal law, he would understand the difficulty of administering a provision of this kind.
– I realize that, in some cases, it is difficult to get the six States into line with the Commonwealth, but I do not think that the same difficulty would be experienced when it came to administering a provision designed to afford relief to the farming community which is so hard pressed economically at the present time.
.- I support the proposal of the honorable member for Wakefield (Mr. Hawker). I agree with the Attorney-General (Mr; Latham) that difficulties would be encountered, but I do not agree that the concession would cost the Government £1,000,000, or even £500,000. Most of the dairymen who use engines to run their milking plants, only start them on petrol, and after that run them on kerosene.
– If they use petrol only to start the engine, the quantity they require would be so little that this concession would be worth hardly anything to them.
– Some, of course, use engines which run wholly on petrol, and to dairymen who employ engines for milking and running their separators, the concession, would he of great value. If New Zealand is able to operate a provision of this kind for the benefit of farmers and other petrol users who do not use road vehicles, surely Australia can do the same. I am sure that all the States would fall into line, and pass the necessary legislation. The sum involved might be between £300,000 and £400,000, but not more. When the men on the land are, as at present, right up against it, and in many cases on the verge of financial collapse, every effort should he made to help them. If this concession were granted, many farmers who use tractors for agricultural work would be able to carry on operations which they have had to leave in’ abeyance ‘because of the excessive cost of petrol.
.- It has been said that difficulties are made to be overcome, and the Government should view the problem in that spirit. It is not denied that there are difficulties,’ but I am not prepared to admit that they are insuperable. The injustice that was done in taxing the users of petrol for agricultural purposes, at a time when the tax was imposed for the purpose of building, roads only, has been aggravated by the increased tax that is partly a revenue one. When the tax was first imposed, it was collected from the users of shearing machines, milking machines, tractors, &c, as well as on the petrol used by the farmer in his car or in his motor truck, although he paid considerable sums as shire rates to maintain the roads over which he travelled. Since then, and iii spite of this, as the duty has been increased, the farmer has still been treated in the same way as other petrol users.
The attitude of the Attorney-General (Mr. Latham) towards all these proposals for relief seems to be one of no compromise; either the thing will not be done, or it cannot be done. The fact that New Zealand is successfully operating this provision shows that it can be done. I do not think that any difficulty will be experienced in securing the co-operation of the States. It was suggested by one honorable member that the farmers should go back to the horse, but they cannot do so. In most cases they are so deeply in debt that they cannot buy horses. If the petrol used by farmers were sold in tins and drums, and were coloured as has been suggested, the difficulty of identification would be overcome. In New Zealand a declaration is regarded as sufficient. The Attorney-General stated that the New Zealand system had been considered, but his admission that Senator Greene was to make inquiries regarding it, while in New Zealand, shows that not too much consideration has” been given to it. For three successive general elections’ preceding the last, the’ farmers and non-road users of petrol were promised by the leader of the various parties that something would be ‘done foward3 putting this provision’ in to’ “effect. The farmers, how-ever, have been disappointed. , on every’ occasion, and I plead with the Government’ now to do what it can.
.- I desire to support the amendment, though I think that some of the objections might be met if the proposed exemption were restricted to the farming industry only. I do not know that there is any special case for exempting petrol used in aeroplanes. There is no doubt, however, that the position pf those engaged in rural industries is such that relief should be afforded them whenever there is an opportunity of doing so. That, as a matter of principle, is declared to be the policy of both parties in this House, but, when it comes to carrying out the promises, both parties have failed to do anything practical. The Leader of the House (Mr. Latham) told us that this proposal was embodied in the tariff some years ago, during the Bruce-Page regime, and that the Opposition at that time was loud in its complaints- that the farmers were not obtaining the benefit; of it. When the Opposition got into power, it did no more to help the primary producers in this respect than did the BrucePage. Government. When it comes to giving assistance to the protected city industries, little difficulty is experienced ; but all sorts of difficulties arise when it is proposed that assistance should be given to country industries, or the industries of outlying States.
– How can the honorable member say that, in view of the reduction of income tax and federal land tax by this Government?
– The reduction of the federal land tax gave scarcely any relief to the people of Western Australia; most of the tax is paid by the big land-holders of New South Wales and Victoria. If the Minister of the day happens to be unsympathetic, it is very easy to find excuses for not. doing things to help the farmers, though I believe that we shall get a; better deal from the present Minister for Trade and Customs (Mr. White) than we have had from those ‘who have occupied the position in the past. It is unfortunate for the wheat-growers, and those engaged in the pastoral industry, that we have never had a Minister for Trade and Customs who haS had ; any experience.’ i,n those .industries, or -any particular sympathy with them. The Ministers have , .been . either absolute fanatics for protection-
– I ask the honorable member to discuss the item.
– I haveseen in the newspapers advertisements about the “ can “ and the “ can’t “ family. The one is always able to find a way of doing things, while the other is always defeated by the difficulties of the situation.As regards helping the primary producers, successive federal governments have, it seems to me, always been members of the can’t “ family. A provision similar to that which the honorable member for Wakefield (Mr. Hawker) wishes to have adopted has been in the schedule for a good many years. The Acting Leader of the Government first stated that the remission of a portion of this amount would cost the country £1,000,000. Obviously that was merely conjecture. Later, the right honorable gentleman corrected himself and said that the loss of revenue might be only half that amount. If the Customs Department made a bona fide attempt to evolve a scheme to put this scheme into operation, information should be available to the Minister and the committee on the subject. Apparently there is no such information. We are merely told curtly that the proposal is impracticable. It is said that the New Zealand Government has evolved a method of putting a similar plan into operation.
– By declaration.
– Apparently the honorable member has solved the problem which has baffled . the Customs Department for so long. If the Government is sincere in its professed desire to give relief to the pastoral and wheat-growing industries by removing this imposition, the means can be found to do so. I hope that the amendment will be agreed to, and that the Customs Department will be asked to examine the position thoroughly and submit a practical method for implementing it. That will give thepastoral and wheat-growing industries a. little of the assistance which they so urgently needed.
.- This is one of those difficult proposition’s that would win the sympathy ofmosthonorable’ members if it were possible toevolve a practical scheme. One of the first actions taken by the Government of which I was the leader, was to ask the Department of Trade and Customs to investigate this matter thoroughly . and see what could be done. At that time my Government was increasing the import duties on petrol, and it did not want to penalize those who were not using the roads. As will be remembered, the BrucePage Government increased the duties on petrol in . order to give a granttothe States for road-making. It was obviously unfair that those who used stationary machinery should be called upon to pay the tax, and the Bruce-Page Government made a provision to relieve them in that regard, which it afterwards repealed. It -.must be remembered that that Government, had within its ranks a number of Ministers representing the Country party. It found the scheme impossible of application. Not satisfied with those results my Government further investigated the matter. The necessity to raise revenue through the Customs Department was not years ago deemed so importantas it is to-day. I assure the honorable member for Perth (Mr. Nairn) that every avenue was exploited in an endeavour to relieve those who use petrol engines which do not traverse the roads. It is said that a satisfactory scheme operates in New Zealand. I am not familiar with the details, but it must be remembered that the sister dominion is not a vast continent like Australia, and also that it has a unified government, which makes the necessary checking less difficult. In the circumstances, I. cannot support an amendment which asks this . Government to do what my Government’ could not do. A sense of fairness is necessary. I do not claim that the last word has been said on the subject, which, will, I have no doubt, have the continued attention of the department. I am still convinced that it is amanifest injustice for users of stationary, engines to pay that portion of the tax which is used to make grants to State governments for road-making purposes.
– The Government will consider any reasonable ‘scheme, that is advanced.
– I ‘can assure honorable members that the Scullin Government did so. The present Deputy
Leader of the Opposition (Mr. Forde) was then Minister for Trade and Cus– toms, and he worked most actively in co-operation with the department in an endeavour to devise a satisfactory scheme, hut without sUCcess. Similar efforts were made hy the honorable member for Maribyrnong when Minister. Unless additional information is revealed showing that the proposition is practicable, the amendment should not be accepted.
– I am sure that the amendment of the honorable member for Wakefield (Mr. Hawker) has the sympathy of the entire committee. The. honorable member advanced an extraordinarily good case . on behalf of the farmers. It is evident, from the assurances given by the Acting- Leader of the Government .(Mr. Latham) and the Minister for Trade and Customs (Mr. White), that if a satisfactory scheme were evolved which would give the desired relief to non-road users, the Government would adopt it. The amendment mentions aeroplanes and fishing craft of many descriptions, and presupposes that motorists who use the roads should bear the tax on petrol. There is a certain amount of logic in the argument, but it is . as well to recall how road users have been treated by the Government, and see whether a scheme can be evolved which will give them some relief. During the year 1929-30, £3,700,000 was collected from duties on petrol. In 1930-31, the amount so collected was £3,900,000, of which £2,000,000 was paid to the States under the federal aid roads grant. The Acting Leader of the House (Mr. Latham) indicated that the balance went into revenue. For the year ended June, 1932, about £5,000,000 was collected from this source, of which only £1,800,000 was paid to the States. So that it would appear that the Federal Government is gradually taking to itself a greater and greater proportion of this tax, and is not acting in accordance with its agreement with the States. It was thought when the Government took over the majority of the shares in the Commonwealth Oil Refineries Limited that the intention was to protect the public from exploitation by the big oil companies, and provide it’ with cheaper petrol. That has not been the result. Generally, the charges made by the
Commonwealth Oil Refineries Limited are practically the same as those levied by the major oil companies, which are making huge profits, while in Brisbane the price of Commonwealth Oil Refineries’ Limited petrol is 2d. a gallon dearer than that supplied by its competitors.
In his last report, the Auditor-General stated that the subscribed, capital of the Commonwealth Oil Refineries Limited remained unaltered last year,, being £750,000, of which the Commonwealth contributed £375,001. After reviewing the profits made by the- company, the Auditor-General stated -
In view of the fact that the Commonwealth holds, the majority of the shares in the company, and having regard to the large public interest in this company it is, I think, desirable that the law should be amended to provide for the Auditor-General to examine the accounts.
I feel sure that the Government will agree to that suggestion, and that when the examination is made the Commonwealth Oil Refineries Limited will retail petrol at a cheaper rate. I am also confident that the Government will evolve a plan giving relief to primary producers in the manner sought by the honorable member for Wakefield.
– I support the amendment. When the tax on petrol was first imposed by a Commonwealth Government, the then Prime Minister (Mr. Bruce) definitely stated that it was for the purpose of building main roads. Recently, the Minister for Trade and Customs (Mr. White) informed me that’ the amount received from the duty on petrol went into general revenue. To me, that seems to be almost misappropriation. It is reasonable that the tax should be levied only on road users. When Minister for Trade and Customs> the honorable member for Capricornia (Mr. Forde) made the same statement as that now made by the present Minister, that any scheme to relieve nonroad users from this tax is impractical. When one considers the amount of oil fuel used by primary producers for stationary engines and the like, and their unfortunate position, one can only conclude that the Government is lacking in sympathy for them. It was never intended -that this tax should apply to non-road users. A similar tax operated in Western Australia, but exemption was granted to those who used petrol for stationary engines. All that was necessary was the making of a declaration; and those who made a false declaration were punishable under the law. A similar practice could be adopted in this case. Even though there might be a slight leakage, the Government should err on the side of sympathy for the primary producers, and not simply say that the proposal is impracticable. Its adoption of that attitude is further evidence of its unconsciousness of the position that exists in the country. If it had an accurate knowledge of that position, it would make every effort to reduce the .costs of the primary producer. A calculation of what this tax means to . the man on the land, who is playing a losing game throughout Australia to-day, would show how burdensome it is. I hope that the Government will not lightly reject the overtures that have been made.
.- I feel bound to support the amendment. It will probably be argued that there is difficulty in arriving at a formula for the exemption of the benzine that is used in non-road-using vehicles. The dairying industry is practically, “down and out “. Cream is realizing only about Sd. a gallon, and at that price the farmer has no chance of carrying on. Then there is the man who uses his own vehicle to send his wool to market. Mention has been made of the amount that has been paid by the Commonwealth to the States for road-making purposes. How has that money been expended? Roads have been constructed parallel with the railways, and they confer no benefit on the primary producer. In the electorate that I represent, probably not £10,000, apart from what has been collected by shire councils, has been spent on road construction. Prior to the adoption of a national roadspolicy, the primary producer, who used heavy vehicles paid nothing for the use of the road. To-day he is taxed for the purpose of having roads constructed, and then has to pay as much as £80 a year for the privilege of using them. The owner of a mo tor., vehicle, in addition to > ‘-being taxed through the petrol that he .purchases, has. to pay substantially foi- the registration of his vehicle, as well as for road tax. The quantity of benzine used by a milking machine should be readily ascertainable, because a man who milked 100 cows twice a day would work his machine only for a certain number of hours daily. Similarly, ‘ the quantity of benzine used by shearing engines could be easily calculated. The average quantity used over a given period could be taken as a basis, .and the exemption be limited to that figure.
Reference has been made to certain benzine having been coloured red. When I was last in Brisbane I saw blue benzine. On what ground, therefore, could the sale of red benzine be prohibited ?
According to the honorable member for Wentworth (Mr. E. J. Harrison), the financial interest of the Commonwealth in Commonwealth Oil Refineries Limited amounts to £375,001. To what extent are the producers’ interests represented in this concern? Is a report of its operations ever made to this Parliament? Since it , began to operate, the price of benzine has risen from ls. 7d. to as high as 2s. 2d. a gallon. The purchaser of benzine in Brisbane is charged 2d. a gallon more than the purchaser in Sydney, for what reason I do not know. The Auditor-General has not the right to inspect the books of this company, and has complained bitterly of the fact; but when a few. pounds are handed out to the wheat-farmers of Australia, an army of officials is employed to safeguard the interests of the Commonwealth. The protected oil companies have been robbing the Australian community for years. Immediately it became certain that a royal commission would be appointed to inquire into petrol prices, those companies reduced the price by Id. a gallon in New South Wales, but not ‘ in Queensland. They believed that that would have the effect of throwing the Government off the scent. In the Gulf of Carpentaria the wool and meat-growers have to pay as much as 3s. 6d. a gallon for the petrol that they require to carry on their operations. The need for relieving the primary producers, 1 kno.w, is jan old. subject, which provides a delightful., theme for discursiveness at election time. The Acting Leader of the Country party’ (Mr. Paterson) and the honorable member foi Corangamite (Mr. Gibson) are anxious to learn what the Government proposes to do in this matter. When they were members of another Cabinet, and had the necessary “ punch “, “what did they do? The Government claims that the proposal which has been brought forward is unworkable. If that be so, why should public funds be wasted upon the inquiries that are now being made in New Zealand ? I apprehend no difficulty in giving effect to the proposal ; therefore I intend to support it. Sitting suspended from 6.1b to 8 p.m.
.- It is pathetic to hear the honorable1’ member for Perth (Mr. Nairn) and other ministerial supporters asserting, in chorus with’ the Country party, that the Government is unsympathetic with the man on the land. We heard a refreshing admission from the Leader of the Opposition (Mr. Scullin) that his Government failed to evolve a system for distinguishing the petrol used on the farm from that used on the roads. Although members of the Country party have asked for a concession in respect of petrol used for tractors and other farm vehicles, they have not indicated to the committee how effect could be given to their proposal.
– We suggested the use of a coloured petrol in farm vehicles and an exemplary fine for offenders.
– That suggestion is futile. Do honorable members imagine that if farm petrol were dyed red chemists could not quickly devise a means of removing the colour? I know enough of chemical research to be satisfied that the colour of the petrol could be changed at will.
– Why not make it striped?
– That suggestion is not less foolish than the others. The honorable member for Perth said that in New Zealand the farmer, upon making a signed declaration, can get a rebate of the petrol used in his farm vehicles. In Australia such a system would bring a rich harvest to the legal profession. Every declaration would have to be pai’d for, and when the users got into difficulties with police^ they would be a ‘ source of’ income for the lawyers. A farmer may have two motor cars and a traction engine; is he to be allowed to declare that he uses only one portion of the petrol for his motor cars and the other portion for the tractor? Do honorable members seriously believe that this declaration system could be operated in Australia? New Zealand has only 187,950 commercial vehicles, as compared with the 587,000 in Australia. The area of New Zealand is 103,000 square miles-; that of Australia is approximately 3,000,000 square miles. The population of New Zealand is 1,542,000, and that of Australia, 6,500,000. The declaration system may be operating successfully in the dominion, but the policing of it throughout the Commonwealth would cost as much as the concession given to the farmers. I am tired of this constant cry of “ the city versus the country “. Members of the Country party seem to be willing to attack the Government on any pretext, and to blame it for all the troubles of the farmers. The honorable member for Wakefield (Mr. Hawker) would be wise not to press his amendment.
– Because it might defeat the Government?
– The defeat of the Government on. a proposal of this character would show absolute stupidity on the part of the majority of honorable members. No proposal ever put before the House was so full of make-believe. It is pretended to be in the interests of the farmers, but- it is so impracticable that honorable members cannot reasonably support it. I suppose that the members of the Country party are not concerned to safeguard the revenue. I have heard them ask that the profits of the note issue be diverted to the farmers, and that the sales tax be taken off all their requirements. Now they want to get their hands on the proceeds of the petrol duty. » We are told that an excessive’ revenue is raised from the5 duty on ‘ petrol and that the user on the farm pays twice for his motor spirit. Whence would the £4,000,000 for the wheat bounty come if the Commonwealth Treasury were not being replenished from some source? How’ would ‘the grower fare if there -were not the city populations to buy his products? ‘ The statement . that’ the ‘“‘city people are opposed to the man on the land, is false. I believe that every city business man recognizes that his interests are bound up with the prosperity of the country. Another suggestion made in regard to petrol used by the farmers was that it should be delivered on the farms in special drums. If that were attempted policemen would have continually to travel the country districts to see if coloured petrol was being used for the purposes for which it was intended. The futility of these suggestions is almost incredible. Do honorable members believe that a farmer with motor cars and a tractor would not occasionally put the concession petrol into his ears and trust to his luck to escape detection?
– Do not judge the country people by Sydney standards.
– Some of the most opulent men in the metropolitan areas have come from the country. They made their fortunes in rural pursuits, and now live in luxury in the cities. The Leader of the Country party in the Parliament of New South Wales lives in a city mansion. The best residential sites in the metropolitan areas are occupied by wealthy squatters and farmers. The Attorney-General (Mr. Latham) referred to the probable effect of the proposed concession upon the revenue. The honorable member for Corangamite (Mr. Gibson) disputed the figures of the honorable gentleman, but could not estimate the loss more closely than to say that it would not be very much. If the saving to the farmer would not be very much, why disturb the revenue for the sake of so small a gain ?
– This duty is the last straw on the back of the primary producer.
– We have heard of that last straw on many occasions, and each time it has been identified with a different proposal. The farmers! who are complaining, at, least,. the .farmers in New South Wales, are already receiving from the State Government all the consideration that it is possible to give them, and now we have this proposal to extend relief to them by discriminating in the duty on petrol., ..No . honorable member would ‘Object to.10ur .primary producers receiving assistance in whatever way may be possible, within reasonable limits.
But we should not forget that, in the City of Sydney, and the same may be said of other capital cities in the Commonwealth, hundreds of .thousands of citizens are unable to grow their own vegetables or foodstuffs and are. obliged to live on is. 9d. a week.
– The honorable member is now digressing from the subject-matter before the Chair.
– Recently I went through some of our country districts to make inquiries concerning the position of our primary producers. One wheat-grower to whom I spoke said that for motive power on- his farm he was reverting to horses; that sooner or later other farmers who could grow fodder for their horses, hut might not be able to buy petrol for their traction engines, would be forced to do the same. Whether or not the troubles of our farmers will be adjusted in this way it is impossible to say, but I submit that those who continue to use motor traction for the development of their properties are not so much in need of assistance as others who, by stress of economic circumstances, are obliged to revert to horse traction.
I am not complaining, noi’ does any other honorable member representing city or suburban electorates complain, about a fair measure of assistance, being given to the men on the land. What we object to is the attempt by representatives of primary producers in this House to make it appear that we, who more directly represent city interests, are not. as much concerned as they are about the plight of our primary producers. Such imputations are wicked, and entirely without justification. Up to the present no workable scheme has been put forward. When the honorable member for Gippsland (Mr. Paterson) was a member of the BrucePage. Government, requests were made that relief should be given to our farmers by,. discriminating in the petrol duties in the way that is: now suggested. But although the honorable gentleman was able to produce a Paterson butter scheme, he was not able to devise a workable proposal relating to the petrol duties. Mem…..0 of .the Country ‘party i( have e’n- j devoured to create. , t:he impression that the Acting Leader of the’’ House, in opposing this amendment, was merely trying to find an excuse for the failure of the Government to help the Country party. That is a wicked imputation. I repeat that representatives of metropolitan electorates are doing their utmost to help the country people without, at the same time, prejudicing the interests of their constituents or those of the people of Australia generally.
– I differ from the honorable member for Barton (Mr. Lane), inasmuch’ as he suggests that the amendment is unreal, and that its supporters are putting up a sham fight. I believe honestly that the honorable member for Wakefield (Mr. Hawker) tis sincerely desirous of ‘carrying the amendment, believing that it will benefit the country interests. His intention is to ensure ,a rebate of the import duty on petrol, benzine and benzoline intended for use in tractors and farm machinery. I find myself unable to support it, for -reasons which I shall enumerate.
– The concession would apply only to petrol for farm machinery, which does not use the roads.
– I am aware of that; but I think it would be wrong to carry legislation of a. sectional nature. With other honorable members on this side of the chamber, I have, for the last two years, been urging the Government to set aside a large portion of its revenue for the construction of public works, with a view to stimulating prices and restoring confidence in industry, which would be a help to every one in Australia; but, because of the stringent financial position, the Ministry has been unable to accede to our request. It seems to me that there is a growing feeling in Australia that this Government’s policy is to impose more and more burdens on 60 per cent, of the people in order that it may bestow certain privileges on the farming community of this country. I am not saying that it is not right for the Government to give this relief to our struggling farmers, and I agree that the bonuses which they have received, also the assistance given to them in the purchase of fertilizers, as well as the concessions in tariff items and ‘sales< ‘tax legistlation, which other sections have not enjoyed, have- all been necessary. But action in this direction has established a big volume of opinion that this continual helping of one section of the community, is evidence of its class consciousness. I, therefore, cannot approve of the amendment to give a rebate on petrol for farm use; because, as I have explained, it will afford relief to one section of the community only. If it were possible to relieve all sections, I should vote for it, although I should hesitate to ask the Government to surrender any portion of its revenue from this source,, because I am anxious that it should put in hand a number of relief works that are urgently needed. I do not think the duties ought to be reduced at all, but if there is to be an alteration, it should be made in such a way that everybody in the community would benefit1- f rom it. I do not wish to convey the impression that the underlying motive in submitting the amendment is wrong, because I am certain that our farmers want relief; but I cannot forget that great army of people who are struggling on the brink of insolvency - the employers and employees in one- and two-men factories all over Australia - who depend on motive power for the carrying on of their industries, and who are being forced by economic circumstances to close their establishments. I remember also that thousands of employees, men engaged in canvassing throughout the country, depend on, motive, power for their livelihood. They are. just as deserving of relief from these petrol duties as are the men on the land. I think the principle of the amendment is wrong. If it could be shown that the only people who are in difficulties are our primary producers, it would be our duty to assist them, perhaps in. the way now suggested; but it cannot be shown that our farmers only are in need of help. The number of people, outside -the primary industries, who are in a desperate plight is, at least, one-third greater than the number of primary producers who are in need of assistance. It is for this reason that I cannot, vote for any proposal which will give relief only to the farming community of this country. I am opposed to it because I’ ‘believe it is wrong to discriminate in the way suggested. I could mention all- ‘kinds of callings ‘ in which people who depend upon motive power are on the brink of insolvency, and are as much iu need of this form of assistance as are our primary producers. There is nothing unreal or dishonest about the amendment ; but, as I have explained, my difficulty is that I represent other people who are in as great trouble. The. only difference is that some of our farmers who, to-day, are in difficulty, have been in a much better position in other days,, and, doubtless, feel more keenly their present position than does the city employer or employee who has always been more, or less struggling on the verge of insolvency. But that is no reason why the one section should not get the same consideration as. the other. In this matter, I feel it to be my duty to support the Government, primarily because it wants the revenue. . I believe that . it should be unhampered so that it may put in hand, as quickly, as possible, works for the relief, of unemployment. In this way, it should he possible to stimulate trade and industry, and create for goods and services a demand which will be much to the advantage of the community generally.
Mr. E. F. HARRISON (Bendigo) [8.29). - I was surprised at the statement of the Minister (Mr. “White) that the Commonwealth Oil Refineries Limited was allowed a rebate in the duty on crude oil, but I feel a little diffident about offering criticism because of the misstatement which I made a few days ago, and which I had the pleasure of withdrawing yesterday. I believe every honorable member thought, when the Commonwealth Oil Refineries Limited was established, that it would effectively check the rapacity of the foreign oil companies operating in Australia, but apart from what it might have done to bring about the recent reduction in the price of petrol, it has not done anything to make petrol and kerosene cheaper to consumers. The Commonwealth Government has provided over 50 per cent, of the capital of the company, and is well represented on its board, and it seems to me that more should have been done to bring down the price of petrol and oil to consumers. I atn acquainted with the difficulties confronting the man on the land. For: his various farm engines and implements, such as tractors, auto-headers, milking machines, and irrigation plant, and, iu some instances, his petrol electric light installations, he needs motor spirit. The high duties on this commodity bear heavily on him. I listened with interest to the remarks of the honorable member for Wakefield (Mr. Hawker), and the Acting Leader of the Country party (Mr. Paterson), but I cannot see how it is possible to grant a rebate of the duties paid on petrol used in farm implements and machinery. A farmer may have a tractor to haul his farm implements, a motor truck to convey his produce to market, and also a motor car which, in better days, he used for pleasure, but is now used only occasionally to visit the neighbouring town. He obtains his petrol in 40-gallon drums. Under the amendment, ‘one drum, would contain coloured petrol . for use in the farm implements and machinery, and the other drum would hold petrol, the colour of water, for use in. the motor which he drives along the road. Should he find himself short of petrol for his road vehicle, will he remain at home, or will he not rather use some of the coloured spirit? It will be impossible to prevent him from doing so, and in the circumstances it would be unwise to place on the statute-book legislation to which effect could not be given. Until we can evolve a better method- pf bringing about this differentiation, it would be best to continue the. present system., notwithstanding that the man on the land needs all the assistance we can render him. In an endeavour to find a method of differentiating between the two classes of petrol, the Government has asked the Assistant Treasurer (Senator Greene), who is now in New Zealand, to make inquiries into the system in operation there, under which petrol for commercial use on farms is subject to a lower duty than that imposed on petrol consumed in road vehicles. New Zealand, however, has only one government for a comparatively small country, whereas Australia has seven governments and a huge continent to control. What is suitable to New Zealand is not necessarily suitable to Australia. It is not because of any lack -of sympathy with the man on the land that the Government is unable to accept the amendment, but because it would be unable to police any regulation to give effect to it. I regret that, at this stage, I cannot vote for the amendment.
.- I. support the amendment moved by the honorable member for “Wakefield (Mr. Hawker), because I believe that some practical assistance to the man on the land is long overdue. Many farmers in my,:own electorate have suffered in turn from droughts, floods, or fires, and have not received the benefit of insurance. Petrol used in stationary engines and farm implements should be exempt from taxation, at least to the extent of the 2£d. a gallon imposed principally for the maintenance of roads. I ami amazed that the opponents of the amendment should regard every primary producer as a dishonest person, who would use, in his motor car or other ‘ road vehicle, the petrol which should be reserved for use in farm machinery. It should not be difficult to evolve some means of protecting the revenue. Perhaps the method suggested by the honorable member for Wakefield, namely, that of using a coloured petrol sold in containers would meet the case. The New Zealand Government is content with a declaration signed by the user of the petrol that it has been used in machines which justify him in’ claiming the rebate. There may be difficulties in arranging for a rebate in Australia, because the petrol tax is paid to the Government by the importing petrol companies, and not directly by the consumers of petrol ; but, surely, those difficulties are not insurmountable. Another section of the community which suffers from the heavy impost on petrol comprises those fishermen who use petrol in their launches. At Lake Macquarie in New South Wales, and elsewhere in Australia, there are numbers of fishermen who consume large quantities i of petrol in their motor launches, i and indirectly pay for the upkeep of roads which they scarcely use. They claim that just as mining and agricultural machinery is sometimes admitted free of duty so the petrol that they use in their fishing launches should also.be free of duty > Several honor able members’ have urged” the need for a cheaper fuel iii this coun try. If we were to develop our own fuel resources, we could obtain a cheaper fuel, and at the same time make ourselves less dependent on outside sources for our supplies. In the event of war in the Pacific, our petrol supplies from America and other countries would be cut off, in which case we should probably set about developing our own fuel resources. Experiments have proved that oil can’ be extracted from coal as a payable commercial proposition. Numbers, of people are spending their private fortunes in further investigating this means of obtaining fuel, without receiving any assistance from the Government. Rather than send £18,000,000 out of Australia every year for petrol and oil we should develop our own fuel resources, and by that means employ Australians instead of finding employment for people in other countries. Petrol is a tool of trade in the case of those people who use it in their business on farms and in ways which do not involve the use of roads. I should be as willing to accept a declaration from a farmer or a fisherman as to the use to which his petrol had been put, as I would a declaration from any other person in the community. I do not think that our primary producers or our fishermen would adopt dishonest practices merely in order to obtain cheap petrol for their motor cars.
– It is my intention to vote against the amendment. My reason for taking “this stand is that we are not justified, in passing legislation unless we know that we can give effect to it, and this amendment does not -solve the- problem. I am afraid that the criticism of some honorable members with respect to the need to assist the country districts, is due to a lack of appreciation of the conditions that really prevail there. The honorable member for Melbourne Ports (Mr. Holloway)’ objects to the’ principle of assisting one section and not’ another. The only principle in his argument was that, if relief cannot be given to all sections of the community, it should be given to none. It is our duty to assist to the best, of our ability ‘ the primary producers, and particularly those engaged in pioneering’ work, “‘and 1 we should refrain, so far as possible, from taxing any article which is required by them as an instrument of production, because, to tax such an instrument, is to tax production itself. Our policy should be to assist production. I am afraid that many honorable members do not realize the fact that, in Australia, a great deal of our work, is still pioneering work, particularly in the younger and less populated States, where men have settled on the land with comparatively littlecapital, but with a great deal of spirit” and courage, prepared to play their part in developing this nation. We should assist those settlers by reducing, so far as possible, the . taxation upon their instruments of production. At the same time, we must not withhold our sympathy from the class of people mentioned by other honorable members. This Parliament has already shown that it has a great deal of sympathy with the unfortunate people who are unemployed in Australia, and this Government, like its predecessors, is deeply imbued with the absolute necessity for assisting them. It has already done a great deal to relieve the widespread unemployment that exists in the community. The problem which the honorablemember for Wakefield (Mr. Hawker) has tried to solve in his amendment is not new to this Parliament. Several governments have from time to time endeavoured to arrive at a practicable scheme to enable the users of petroldriven stationary engines to be relieved of a certain measure of taxation ; but have not been able to discover practical means of doing so. The difficulty, ashas been pointed out by the AttorneyGeneral (Mr.- Latham), is that we have not a unitary form of government. We have a Federal Constitution which defines and distributes the powers of the central authority and the States. The importation of petrol is a matter of trade and commerce, between this and other countries, over which, the Commonwealthhas jurisdiction. We can,therefore, impose conditions in respect of the importation of that commodity. But, once the petrol is landed and becomes ani nstrument of trade between corporations, companies, or individuals in.aState,itis amatterofintra-statetrading,inrespect ofwhichtheCommonwealthParliament has no power, and it is difficult, there fore, for the Commonwealth to impose conditions in respect of its use. If a practicable method can be evolved to overcome this difficulty, I shall be glad to support it ; but this amendment is not a practical solution. The taxation on petrol used for power purposes imposes a considerable burden upon the primary producers, particularly those who are carrying out pioneering work. The position of the Government is perfectly clear. The Attorney-General has stated emphatically that it is not unsympathetic, and that everything that it can possibly do to relieve the position of the struggling farmers will be . done. The Leader of the Opposition (Mr. Scullin), when Prime Minister, took up asimilar attitude. For the reasons that I have stated, I much regret that, in the absence of any practical proposal which can be effective, I must record my vote against the amendment if it goes to a division.
.- Asone who tried to bring about the reform sought in the amendment now under discussion, I do not wish to cast a silent vote upon it. I am in accord with the motive which actuated the honorable member for Wakefield. (Mr. Hawker) in moving an amendmentthe object of which is to admit free of duty petrol and other kinds of fuel for use in stationary engines, farm tractors, or implements, fishing boats, aeroplanes, or other machines, or vehicles not used upon the public roads. I had that object in mind when, as a member of the Opposition during the regime of the Bruce-Page Government, I requested the then Minister for Trade and Customs to grant a reasonable rebate on petrol used by farmers and others in machines and vehicles not used on the public roads. When, later, I became Minister for Trade and Customs, I found that such a scheme was impracticable, but I did not put it lightly aside.I obtained particulars of the;. scheme operating in New Zealand, but, after carefully examining them, I decided that it was impracticable to adopt a similar scheme in Australia, first, because we had two local refineries, the products of which were ‘dutiable at a rate different from that applying to importedpetrol,and,secondly,because New Zealand, having a unified form of government, was better able to police its laws. As the honorable member for Darling Downs (Sir Littleton Groom) has said, this matter has for many years engaged the attention of successive governments. The late Mr. Pratten, when Minister for Trade and Customs, moved, On the 10th August, 1926, an amendment to admit petrol and other fuel used for the purposes mentioned in the amendment of the honorable member for Wakefield into Australia as prescribed by departmental by-laws - British, ½d. .:per gallon; intermediate, Id. per gallon; and general, Id. per gallon. But Mr. Pratten himself when introducing his amendment said -
At this juncture I shall not say any more than there will be some trouble in the collection of. the proposed duties, but if the committee so wills it they can and will bc collected in the form in which I have now submitted them.
About three years later the then Minister for Trade and Customs (Sir Henry Gullett), who was a member of the composite Ministry, brought down a tariff schedule, and at the same time made the following comment: -
These schedules of tariff and excise amendments “are, of course, consequential upon the statement which has just been made by the Treasurer, Dr. Earle Page, in his budget.
The Leader of the Country party (Dr. Earle Page) was then Deputy Prime Minister, and while I have no doubt that the members of the Country party who have spoken on this subject are just as earnest as I was, and as the honorable member for Wakefield is now, that this reform should be brought about, I remind them that when they held the second, fourth, eighth and tenth positions in the composite Government, representing four full portfolios out of ten, they found it absolutely impracticable to put such a scheme into operation. After the matter had been thrashed out at great length by the composite Ministry, the honorable member for Henty made this statement -
The Government regrets very much indeed that we are abandoning the original intention of Parliament to make a rebate of 2d. a gallon on imported petrol used for industrial purposes apart from the propulsion of road vehicles.
As a private member, and as Minister for Trade and Customs, I did my best to make this rebate, but I found it to be impracticable to put the scheme into operation. The honorable member for Henty, when Minister for Trade and Customs, in 1929, said- .
If this provision cannot be administered, it should not be allowed to remain in the tariff schedule. The present position is hopelessly unsatisfactory, and the Government with the greatest reluctance lias come to the decision that the provision should go.
I am of the opinion that, however sympathetic we may be with the primary producers who desire this rebate, there is no practical method of giving it to them. I do not wish to traverse the ground which has been covered by other speakers. In the big scattered areas of Australia, it would be difficult to check the quantity of petrol used in motor cars and the quantity used in farm tractors and engines belonging to the same farmer. In any case, the scheme, if it could be adopted, would involve a considerable loss of revenue. I know that the primary producers are experiencing just as bad a time as other sections of the community, probably a worse time. Many of them are on the dole. In better times thousands of them bought tractors, which to-day cannot be sold, except at great loss. They cannot afford to buy draught horses to take the place of their tractors. There are many of these unfortunate farmers in my electorate. I do not sa’y that all of the sympathy for the primary producers Comes from one side of this chamber. I believe that all honorable members desire to do everything possible to help the men on the land to get over the trying times through which the country is passing. It is all a matter of method and resource. I do not doubt the sincerity of the mover of the amendment. But I know from my experience as Minister for Trade and Customs, that it is impracticable to make rebates in the way that he has suggested. So, while I regard his object as laudable; I cannot support his proposal.
.- There is no doubt that the consensus of opinion among honorable members is that the concession asked for by the honorable member for Wakefield (Mr. Hawker) should be granted. But the view has been expressed by a number of honorable members that the scheme is not practicable.
I cannot understand the honorable member for Capricornia (Mr. Forde), in particular, expressing such an opinion, for he knows that remarkable facilities have been provided in certain other directions for giving effect to proposals which, at first glance, must also have seemed impracticable. The ingenuity of the officials of the Customs Department would be great enough to devise a means of giving effect to the amendment without loss of revenue, if the Government decided that this should be done. To show what is possible in this direction, I quote the following paragraph from a letter that has been placed in my hand : -
I desire to dram your attention to the fact that as certain tractors supplied by you have been converted into road graders or road scrapers, it is not permissible to supply, for replacement purposes on these converted tractors, any parts of engine, which have been entered under customs by-laws under security since 22nd November, 1929, until authority has been obtained from this office, and full duty paid thereon.
You will see from this the position in which we are placed, and would deem it a favour if you would kindly advise us by return whether the caterpillar tractor which you are operating has been converted into a road grader or road scraper, by which the customs mean that it is fitted with a machine which the tractor pushes and does not pull.
– I rise to a point of order. I submit that the item covering tractor parts is not the item .before the Chair. If the honorable member for Swan (Mr. Gregory) desires to indulge in propaganda, this is not T;he appropriate time to do so.
– I have followed the honorable member very closely so far as he has gone. I. understand that he is submitting that a practicable scheme for giving effect to the amendment can he devised.
– The letter continues as follows : -
If your tractor has been converted in such a manner that same is engaged in pushing r-oi 1-making machine, we will be compelled to charge you the higher price for parte, but if same is only employed for agricultural purposes, or for traction engine purposes, pulling any road-making machinery, parts will not be liable to the high rate of duty.
If the Customs Department can draw a distinction between the parts required for a traction engine that’ pulls as against one that pushes, Pf eel sure ‘that, in its accumulated wisdom,’ it could also devise a means for granting a rebate, as desired by the honora’ble member for Wakefield, to certain users of petrol.
– I was a supporter of the previous Government, and know that this subject was threshed out in the party room as all such subjects are threshed out, and a decision reached that it was impossible to administer a scheme of this description. As the Government of which I supported could not do what the honorable member for Wakefield (Mr. Hawker) desires this Government to do, and as I .do not regard this Government as having a monopoly of the brains of this Parliament, I cannot support the amendment. If this scheme could have been administered, the previous Government would have administered it ; but the plain fact is that it cannot be’ administered. Probably more tractors are used in my electorate than in any other electorate in Australia. If it were possible to provide a spirit different from petrol or kerosene to drive these machines, a differentiation could be made that would assist the primary producers who used it, but, hitherto, that has not been possible. I give place to no honorable member in my desire to assist the people who go out into the bush to make a living, and if I thought that there was a practicable way of helping them in this direction, I should advocate it ; but for reasons that I have given, I cannot support this amendment.
– I congratulate the honorable member for Wakefield (Mr. Hawker) upon the sincerity and ability with which he has submitted his amendment;; but I regret that, after listening carefully to the debate upon it, I cannot support it. If it were agreed to I feel that there would be too great a difference in the price of spirit .used for commercial purposes and that of spirit used for other purposes. . I am also of the opinion that it is impossible to devise a workable scheme for the granting of the proposed rebate. Several governments have tried to give effect to this proposal, but have not been able to find’ a way to do it. It would be quite impossible, in my opinion, to police the use of petrol. in a vast country like Australia. The honorable member for
Wakefield has suggested that it might be done by the use of a tinted spirit;but if a particular tint of spirit were set apart for a special purpose, and made available at a lower price, we should very soon find that people were obtaining it and applying it to other purposes than that intended. Even farmers might be tempted to use spirit intended for stationary engines for ordinary transport purposes. The honorable member for Kennedy (Mr. Riordan) made a few suggestions to overcome the difficulties that have been outlined during this debate. If his proposals were accepted work would be provided for about half the unemployed in Australia in carrying them out. The honorable gentleman suggested that a check should be made of the quantity of petrol used in working milking machines for, say, 100 cows,, or that an estimate could be arrived at of the quantity of petrol used by fishermen in theiroperations.Inmyopinionit would be utterly impracticable to do any such thing. If the price of petrol is to be reduced at all, the reduction should be general. Motorists have been the target of governments for many years. I suppose the average motorist pays £9 or £10 a year in registration fees, in addition to the tax of 7d. a gallon on petrol. Probably the total tax is equivalent ‘ to about1s. for each gallon of petrol used. I should like to help the primary producers in the way suggested, but no workable means of doing so has been outlined. The honorable member would probably have obtained more support had he suggested a rebate of half the duty.
.- I shall not suggest that the opposition to my proposal is due to lack of sympathy. I suppose that 50 per cent., of it is due to conservatism, which is a thoroughly good quality, 25 per cent, tothe fact that Ministers are’ so over-workedthat they have not had time to consider the details of a scheme such as I have suggested, and the remaining 25 per cent, to a sublime and Olympian selfcomplacency on the. part of . certain honorable members. I suppose none ofus are withoutsometinctureofthatquality. I perhapsoweittothecommitteeto explain in more detail the method by which I suggest that a rebate could be made. Evidently I did not go into sufficient detail in moving the amendment. Having discussed this subject with several honorable members privately, I thought that they understood my proposal better than’ their subsequent remarks have indicated.’ The Acting Leader of the Government (Mr.; Latham,), in his speech in opposition to the amendment, gave a magnificent exhibition of the destruction of Aunt Sallies. It is a game of skill at which he is an absolute past-master. He drew a picture of people buying a few gallons of petrol from this bowser and a few gallons from that, and then claiming small rebates in respect of a part of their purchases. Of course it would be impossible to check small transactions of that description. I did not suggest a complicated system of that kind. New Zealand is a big country with many outback places, some of which are just as remote as the outlying areas in mountainous districts in Australia; but yet New Zealand has been able to devise an effective system, of making refunds to the consumers of petrol. Owing to our more complicated constitution it would not be possible for us to make rebates to consumers on application by statutary declaration, as is done in the sister dominion; but I submit that it could be done under our excise powers. The Acting Leader of the Government also threw ridicule on that proposal. I pointed out that in parts of America petrol was tinted so that it could be easily distinguished. If such petrol were used for fraudulent or illegal purposes, it would not be difficult to discover it. We could use a tinted petrol and a check could be kept with the object of ascertaining whether evasions of duty were occurring. I direct the attention of honorable members, to Spirits Regulations, Statutory Rules., 1926, No. 202, paragraph18, which reads as, follows: -
Except with the written permission . of the Comptroller, methylated spiritsforsaleshall not be treatedin any manner or mixed with water or other substance, so as to reduce the strength normally appertaining to such methylated spirits, which in the case of “ industrial.” methylated, spirits shall notbe less than64, degrees overproof.
If there ispower; to prevent morethana certain percentage of waterbeingput into methylated spirit, it would be possible at some period when petrol is being treated, to prevent colouring matter from being put into petrol, because that is a more definite and distinct operation than putting a,’ certain percentage of water into methylated spirit. Petrol is in bond when it is imported, and it is under bond where it is refined in Australia. This treatment of petrol could be controlled under licensee in much the same way as sales are controlled under the Sales Tax Acts; therefore, it would not be difficult to supervise the colouring of petrol while it is in the hands of the wholesalers. Only a limited number of companies deal in petrol and , other petroleum products. The honorable member for Swan (Mr. Gregory) has referred to a case in which the customs officials administer a rebate on spare parts used for a tractor which pulls a road-making implement as against one which pushes it. The distinction in that case is so fine that it dwarfs into insignificance any difficulties which may be associated with the problem set up by my amendment. Recently I came across an instance of strychnine being subject to a rebate of tax when used for poisoning rabbits, but not when used for poisoning dingoes and foxes, which are at least as destructive as rabbits. That is an anomaly which should be removed, for if such anomalies were multiplied they would lead to ridiculous complications. Such a complication would not arise in connexion with the sale of coloured petrol. Wholesalers who deal in certain commodities which are taxable under the Sales Tax Acts have to register, and show a record of the goods in which they deal, and. therefore, it should be possible to hold a similar excise control over the wholesalers of coloured petrol. This form of control is exercised ‘to-day in a most complete’ way ‘over .the distillation of spirit for fortifying wine and in the handling of methylated spirit. Legal- power is given in these cases, and there is elaborate, , supervisory machinery. If control were taken to that stage it Would’ then- be possible, to check the sale of coloured, ‘exempt pe’trol, and to’ confine its-sale- to persons who’ make a statutory declaration that it was to be used for certain purposes only. At the same time, there would be the excise check on this petrol. At the present time no private person is allowed to have a still on his premises, or to make wine without a licence, and it could be made illegal for anybody to colour petrol without a special licence. The fact that a person could not deal in such petrol without a licence would enable a real check to be kept on all the coloured petrol in use. In those circumstances, it would be possible to prove, if coloured petrol was found in a motor car on a road, that it had been obtained either by colouring it without a licence or by a breach of the declaration which would be required to enable exempt petrol to Joe sold. Although it is apparently impossible for the Commonwealth to regulate trade within a State, it does not seem to .be impossible to provide for the licensing, regulation and taxation of sales, within a State under the -Sales Tax Act under the latent power of taxation, and under the power of excise which lies in the Commonwealth Parliament. With these powers in its hands, I believe that it is quite reasonable to assume that the Government, just as it was able to evolve a system for collecting sales tax, and for making certain exemptions under declaration, and sometimes without declaration, could make it illegal, so far as the letter of the law is concerned, to use coloured petrol for illicit purposes.
– Why did not the honorable member evolve a workable system during the ten months when he was a member of the Ministry?
– For one reason,” I was prevented.
– Nothing of the kind. What is the honorable member’s scheme ?
– I have explained it in considerable detail.
– I have heard a good deal about methylated spirit, but nothing about petrol.
– I have already explained that the present regulations contain detailed provisions for limiting the treatment of other commodities, such ais methylated spirit.- I presumee that that power:-! has’ proved effective, because it is - contained: in regulations which were made at a time when the Acting Leader of the House (Mr. Latham) was Attorney-General. If that power exists, it should also be possible to limit the treatment of petrol with certain colouring matter. This afternoon the Acting Leader of the House, in the limited time available to him, quickly demolished, to his own satisfaction, the whole of the arguments advanced to show that it would be possible to distinguish one sort of petrol from another, by saying that the Commonwealth Parliament had jio power to prevent persons from treating plain petrol with a similar dye.
– There is a distinction between excise legislation and customs legislation. “
– Of course there is; but certain goods which come through the customs bond are afterwards used in the preparation of spirits, wines, spirituous essences, &c, under bond, and I propose to the Government that it should extend the excise regulations to the blending of petrol with a colouring matter. If that can be done for the purpose of the further breaking down of crude petroleum, it is not impossible to have excise control over the blending of petrol with another material, and thus provide a check which would enable a stated legal authority of the country, whether State or Federal, to make effective a law against the fraudulent or illicit use of duty-free petrol. This could be further reinforced, for instance, under powers similar to those conferred by the sales tax law, by limiting the purchase of this petrol to persons who first secure a licence; and the granting of the licence might be made dependent upon a statutory declaration to the effect that the petrol was to be u3ed only for the special purposes for which the exemption was granted. Further, the renewal of the licence might be made dependent on another declaration that the petrol previously purchased under the previous licence had all been used for legitimate purposes. That, I think, outlines in detail the way in which I think that the scheme could be worked effectively. It was stated in opposition to the proposal that , some petrol was distilled locally, and some was imported as petrol. I do not think that that would be a permanent obstacle, because, as a matter of fact, the trade would take place only in the imported petrol, which was subject to the larger rebate. If petrol were marked and kept separate, it would have to be -.handled separately, and it would not pay the distributors to have separate bowsers. The distribution of the coloured petrol could even be confined by regulation to trade in containers. But, in ease there is objection to the scheme on the ground that on some of the petrol the excise is 5-Jd. a gallon, and on some of it there is a duty of 7d. a gallon, I ask leave, of the committee to alter my amendment by striking out “ free “ and inserting “ 1-Jd. a gallon “ in both columns, so that there would be a flat-rate reduction of 5£d. a gallon. If the scheme proved effective, it would be possible later to make the exemption more far-reaching. It has been suggested that other chemicals might be added to the petrol, which would change the colour and make it indistinguishable from petrol on which the duty has been paid. If that- were so, it would destroy the whole case for making the exemption on the basis of a check upon the legitimate use of this petrol owing to its colour. 1 understand that it is possible economically to dye the petrol in such a way that it can be discovered by chemical analysis whether it contains any quantity of a particular dye. A company that is one of the largest employers in Melbourne, for instance, uses a dye in its petrol in order to prevent pilfering. Cases came under notice in which the suggestion was made that the colouring of this petrol had been derived from some other source, but it was possible by chemical analysis to prove the exact nature of the colouring matter. We have to consider whether it is just to tax what may be called the tools of trade of a particular section of the community, and also whether we are entitled to tax those people who, because they live in isolated areas far from electric mains, where they cannot have heavy coaldriven machinery, must rely on lightpower units. The Government, apparently, thinks it is fair to tax these people, despite the’ geographical disadvantages under which they labour, because of the simplicity with, which a great deal of revenue may hecollected from the sale of petrol. This brings me to the argument of the honorable member for. Melbourne Ports (Mr. Holloway) that there are other sections of the community besides the primary producers who are as badly off as they. I remind honorable members, however, that I am not putting forward this proposal on compassionate grounds. ‘ If it were a matter of sympathy only, I admit that some other sections are as deserving as the ‘ primary producers, .but my amendment is based on economic grounds. This tax strikes at the ability of the producers to keep on producing, and at their power to provide employment. I do not agree with the Acting Leader of the House (Mr. Latham) that, because all countries levy a tax on petrol as an easy means of obtaining revenue, we in Australia, with its great distances, should impose this burden on farmers and others who must depend on smallpower units, and on those who must look to aeroplanes to provide them with effective transport. Because this tax is fair and effective against those using petrol for pleasure, we should not apply it indiscriminately to those who must use petrol for purposes of production. The arguments of the Government are, it seems to me, based rather on facility than on justice or common sense. I believe that the Government is genuinely anxious to do what it can to enable the primary industries as well as those of the city to expand and revive. It must know that the revival of trade and employment’, and, ultimately, the improvement of the revenue, really depend upon increasing the productive capacity of the nation. I therefore ask leave to alter paragraph 2 of my amendment to read -
Amendment - by leave - amended accordingly.
Question - That the amendment (Mr. Hawker’s) be agreed to - put. The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 11
Question so resolved in the negative.
Sub-items agreed to.
Division 9. - Drugs and Chemicals
Item 290, sub-item (c1, 2) (Perfumery, n.e.i., Petroleum Jelly, n.e.i.).
.- On the 4th April, 1930,as surcharge of 50 per cent, was imposed under this item, and is still in operation. The perfume industry has developed remarkably in Australia under the protection of duties which have been increased from time to time. Under the 1921-30 tariff the ad valorem rates of duty were, British, 35 per cent., and foreign, 45 per cent. These rates, were increased to 45 per cent, and 65 per cent, respectively under the tariff schedule of the 22nd November, 1929, and on the 14th October, 1932, the foreign rate only was increased to 70 per cent, in accordance with the terms of the Ottawa agreement. We were told by certain : honorable members last night that no duties should be imposed that would prejudice our market in any country to which we were exporting our produce. The Government has been somewhat inconsistent in this regard, because the perfumes which are being excluded under the surcharge at present in operation .are the product of France, a country which buys a large quantity of our wool. Australia has a favorable trade balance with France of £3,500,000 a year. This Government has increased the foreign duty on perfumes to 70 per cent., and it has allowed the surcharge of 50 per cent, to remain. The Government of which .1 was a member realized that, in order to build up industries in Australia, duties had to be imposed on goods no matter from what country they came; and it consistently to.ok that stand, It believed that preference should be’ given to Australian industries. Under the terms of the Ottawa agreement, the doctrine of freetrade between nations as espoused by some members of the Country party, has received a severe setback. Government members have been arguing one way when it suits them, and in the opposite way a few days later.
Several prominent perfume manufacturers were forced to establish factories in Australia when the surcharge was imposed by the last Government. Among them were J. & E. Atkinson, of London and Paris; Roger & Gallet, of Paris; Richard Hudnut, of New York; and Potter & Moore, of London. . They are now producing in Australia commodities from the same formulae as those from which they produced the perfumes formerly imported into this country. That is in accordance with the wishes of this party, because our purpose was to encourage them to open factories in ..Australia. This ranks as an,, important industry in other countries. In the United States of America, it is third on the list, while in England and France it also occupies a prominent position. In Australia it now provides employment for approximately 350 persons, and is of! assistance also to.-, subsidiary^ industries, including those producing, strawboard, paper and metal containers, boxes, printed matter, bakelite products, glass bottles and opal jars.
On the 4th April, 1930, the present. Minister for Trade and Customs (Mr. White) asked me how long the surcharge then imposed would remain , in operation. I now admit to a similar curiosity, and desire to know from him how much longer the surcharge is to continue”. I should like the Minister to indicate how long the surcharge on this item will continue, and whether, if it is removed and it is found, that the protection afforded by the duty is insufficient to enable the Australian industry, to carry on, the Government will have the whole matter reconsidered.
– It is a fact that, since the operation of the duties which were imposed on toilet preparations and perfumery in 1929, several world-renowned manufacturers have established factories in Australia. The Deputy Leader of the Opposition (Mr. Forde) mentioned J. and E. Atkinson Limited, of London and Paris, Roger and Gallet, of Paris, Richard Hudnut. of New York, and Potter and Moore, of London. The old established Australian firms of Felton and Grimwade Limited, of Melbourne, Elliotts and Australian Drug Limited, of Sydney, and F. A. Faulding and Company Limited’, of Sydney and Adelaide, have also done their part in catering for the trade that is offering. These firms, by courage, enterprise, and tenacity, aided by the existing protection, have succeeded in obtaining no less than two-thirds of the trade which formerly went overseas. As a result of business organization and the keen competition between these different companies, the public is now able to buy toilet preparations and perfumery at prices cheaper than those which previously prevailed. - I have had some experience in the matter, and ‘I believe that-, both inequality and attractiveness, our- goods compare favorably .with those from overseas.- It is a pleasure to pay tribute to the” adaptability of these Aus-‘ tralian firms. When, under the changed conditions, the big chain stores, such as Coles’ and.. Woolworths, found ‘difficulty in. connexion’ wish toilet preparations’ and perfumery, for which’-.’ there was a good demand, and of which they had imported,
I understand, some 75 per cent, of their requirements, Australian firms rose splendidly to the occasion ,.and helped those big stores to supply the demand. In Sydney, alone,- approximately £200,000 has been; invested in plants manufacturing toilet preparations and perfumery since the operation of the new duties, and the firms concerned are prepared to extend their operations as the opportunity presents itself. Directly, and through allied trades, such as printing, glass bottlemaking, and the manufacture of containers, those businesses provide employment for a great number of Australians. Incidentally, both in quality and appearance, the bottles in which the articles are marketed are equal to those manufactured abroad. These firms also spend large sums of money on advertising. I believe that most Australians have now a local complex in these matters, but those who desire to purchase high priced products from abroad can still do so if they are prepared to nav the price. The question arises whether the Government is prepared to continue to help the firms which give so much employment, and which have been so satisfactorily established in the belief that they would be amply protected. The information I have indicates that several firms are concerned regarding their position. The following extract is from a letter received from the Sydney agents of Richard Hudnut Limited. It reads : -
Hail our principals known that there was a possibility of the present duties on toilet preparations not being maintained, they certainly would not have invested £75,000 in Australia, and if duties are reduced in order to allow the English manufacturer to effectively compete with the Australian made toilet goods we feel that our principals will give serious thought to supply the trade direct from the factory in London, thus eliminating the Australian overhead expenses and exorbitant taxes.
As we have encouraged overseas firms to establish plant here, and local firms to extend their, business, it is my firm belief that we should provide ample protection to .those industries which are conducted economically, and thus ensure that they continue their activities in Australia.
].The Deputy Leader of.the Opposition (MrFor:de) has asked whether this surcharge, will remain on - perfumery. Honorable’ members will recall that when surcharges were imposed by the Scullin Government it was definitely stated that theywere imposed for financial reasons, and had no protective incidence. Gradually surcharges and prohibitions have been removed. In this instance, the Government considers that these industries are w-ell .- protected ; but the revenue aspect has also to be considered. In 1929-30 the revenue received from duties on toilet preparations and perfumery amounted to £367,571, but when the surcharge was imposed it dropped to £164,058 in 1930-31, and in 1931-32 it totalled only £73,275. When presenting the tariff schedule I said that the majority of the surcharges had been removed, and that they now remained on only eight items. The Government regretted that it was unable to lift all of the special duties, but the items on which they remain have important revenue significance. This is a line of goods com. ing from France, a country which desires to enter into a trade agreement with Australia. It is the wish of the Government to expedite the progress of the schedule so that such treaties may be negotiated. This matter is now before the Tariff Board, whose report is expected any day. When that report is presented the retention or otherwise of the surcharge will be considered in the light of the opinions expressed therein.
– This is one of many illustrations of the beneficial effect to Australia of a protective tariff. The transfer of branches of firms from overseas began during the war period, and has continued.- It is quite true that when the Scullin Government introduced its embargoes and surcharges there was a general outcry. I have recollections of some of the deputations that waited on me when I was on the other side of the world, among them .being one from the -manufacturers’’ of toilet goods and perfumery. Later, those firms established branches in Australia,..and, as was indicated by the honorable member for South Sydney (Mr. Jennings), -in conjunction1 with local firms ‘they are now supplying -‘Australia’s requirements. Local preparations are equal, > if not superior, to’ those’’ which were previously imported.’ “Iri many cases they are cheaper, while the industries concerned give a great deal of direct and indirect employment. Now that we have induced these firms to establish branches in Australia, it is only fair to give them a proper measure of protection so that they may increase their activities and provide even greater employment. One of the greatest problems at present facing the world is to find employment for practically 30,000,000 people. Australia must do its part. No better method of regaining equilibrium can be adopted than that of establishing manufacturing concerns in this country which, by providing additional employment, will benefit the community generally. I hope that the Government will see its way to continue the protection that is necessary to retain these industries within our borders.
Sub-item agreed to.
Division 11. - -JEWELLERY and Fancy Goods.
Items 309 (a) to (d), 313, 314, 315, 318 (a3, 4&) agreed to.
Item 320, sub-item (c2c) - (c) (2) Exposed or developed films -
– I move -
That subparagraph (c) be amended by adding the following : -
And on and after 9th March, 1933 - (o) Other-
1 ) Negative and soft positive, per lineal foot, British, free; general, ls.
N.E.I., per lineal foot, British, free; general, 4d.
And on and after 31st March, 1933 - (c) Other -
Negative; film imported for or intended for purposes of copying, per lineal foot, British, free; general, ls.
N.E.I., per lineal foot, British, free; general, 4d.
The reason for the first part of the amendment is to permit of the incorporation of the item, as set out in the resolu tion of the 8th March last. The second part provides for the payment of ls. a lineal foot on all foreign film imported for the purposes of copying. The March resolution provided for negative and soft positive film being dutiable at the higher rate, but it is still possible for copies to be made from the ordinary positive films. The amendment will have the effect of making positive films dutiable at the negative rate if used for copying purposes.
– How will the amendment affect work in laboratories?.
– It should provide a greater amount of work for the Australian film-printing industry, and will bring in revenue that was previously being lost.
– Is the amendment supported by a Tariff Board report?
– This is a revenue item, on which there is no Tariff Board report. When I introduced the schedule on the 8th March, I stated -
These are the increases imposed on negative and soft positive cinematograph film, and on rubber. With regard to the former, it has recently become the practice to import a negative or soft positive copy only, and to print the whole of the Australian requirements from this. Previously five or six positive copies of a film were imported, but, with the increase in the rate of duty from 2Jd. to 4d. per foot on foreign films there began the importation of only one negative copy of each film, and revenue returns progressively contracted as this practice grew. It is estimated that, as a consequence, revenue from this source has diminished by at least two-thirds, quite apart from the depression factor. An increase of 8d. per foot is proposed on this class of film. The proposal also has the merit that it makes the British preference granted under the item an effective ohe. Under the suggested duties there also exists a large margin for the protection of the local film printing industry.
– Does that mean that copies will be made in Australia ?
– What was the amount of revenue derived from this source last year, and what is the amount expected under the amended item?
– The revenue in the last three years has been as follows: -
The depression/ no- doubt, has had a material effect upon the revenue from this source, hut it is estimated that the returns suffered to the extent of £100,000 as the result of the importation of a single negative or soft positive . from which copies are made.
– Is it likely that the admission prices to picture theatres will ho increased?
– If they are, that is something over which the Government has no control. Picture theatre proprietors may charge more; but, as British films and foreign film copied in Australia are free, there is no reason for their doing so.
Amendment agreed to.
Sub-item, as amended, agreed to.
Division 12. - Hides, Leather and Rubber
Item 331, sub-items (a) (b) -
Rubber and rubber manufactures, viz.: -
Crude rubber, rubber waste, masticated rubber, powdered or reclaimed rubber - British, free; general, free.
.- This duty was imposed for revenue purposes by the last Government, when it was faced with a deficit of something like £20,000,000. It is a duty that I do not like to see continued, because it applies to the raw materials of an important industry which manufactures rubber tyres, garden hose, and numerous other rubber goods. I should like to know from the Minister what revenue is obtained from this source, and whether the Government intends to reduce the duty.
.- Provision is made in the schedules for the free entry of certain material that contains rubber, and is used in the. making of garments which have recently come into vogue, such as those known as foundation garments for women. It is a very fine material, into which is woven fine rubber. It is skin tight, and, because of its extreme flexibility, is very popular. Although of delicate . texture, it yet is strong, and will withstand the rigours of the wash-tub. Being a new material, it is coming into this country in fairly large quantities.
It is purchased, not by the working girls of Australia, but by those who are able and willing to pay a high price. In addition to this, large quantities of manufactured rubber are being admitted duty free. In my opinion, the Government is not consistent in allowing rubber to come into Australia in a manufactured state, while at the same time imposing a duty of 4d. per lb. on the raw material that is the base of numerous articles, including motor tyres and other heavy rubber goods. I am at a loss to know why the Government should single out in this way the raw material of a very important section of our industrial, agricultural, and pastoral life, as well as of our transport systems, thus penalizing what is vitally necessary to the nation.
– This tariff is identical with that of the Scullin Government.
– Exactly. The tariff of the Scullin Government, however, was imposed during a period of acute financial stringency. That condition does not face the present Government at the moment, although later, I believe, some of its chickens will come home to roost and cause it a good deal of financial embarrassment. The financial position of the Commonwealth to-day is totally different from what it was when this duty was placed on crude rubber. But, if it be contended that the requirements of the revenue necessitate the continuance of this duty, then the material of which I have spoken, and which it is proposed to admit free of duty, should also make some contribution to the revenue. I urge the Minister to reduce the duty upon crude rubber.
– I move -
That that portion of the tariff resolution introduced into the House of Representatives on the 8th March, 1933, relating to sub-item
of tariff item 331, be incorporated in the present proposals as on . and from 9th March, 1933, in lieu of sub-items (a) and (b) of item 331 of the tariff resolution introduced into the House of Representatives on the 13th October, 1932.
The reason for this amendment is that the goods covered by sub-items 331 a and b of the October, 1932, resolution, are now coveredby sub-item 331 a of theMarch, 1933, resolution. The effect of the March, 1933, resolutionwas to increase the duty on rubber the produce of any territory of the Commonwealth, from free to 4d. per lb. The amendment incorporates the March proposals, and brings the item into alignment with the memorandum before the committee.
Amendment agreed to.
– Under the 1921-28 tariff, crude rubber and rubber waste .from any country were admitted free of duty, but the Scullin Government, in search of further revenue, imposed a duty of 4d. per lb. on crude rubber from foreign countries. The product of the territories of the Commonwealth continued to be admitted free. These discriminating rates of duty gave to the territorial growers a strong preferential margin in the Australian market. It was only natural that they should take advantage of this preference, particularly as the growers’ representatives maintain that the labour and other conditions insisted upon by the territorial administrations increase their production costs to such an extent that rubber cannot be produced by them for less than 6d. per lb., and that a preference of 4d. per lb. is essential if the industry is to survive. In negotiating sales to Australian purchasers, they included the preference in their selling prices. Local rubber companies recently intimated that they could not continue to purchase Papuan rubber. They advanced several reasons for this decision, and there was much to be said for their contentious. After conferences with representatives of the Government and the Papuan growers, the manufacturers agreed to continue purchasing until the Commonwealth had an opportunity to remove some of the disabilities. One of the disabilities was that because of the use of rubber from both Papua and foreign countries a special customs officer had to be stationed -on the premises of each firm to see what quantities of Papuan and foreign rubber went into manufacture iu order to determine the drawback on exported goods. The matter has been carefully considered by the Government, and-, it is satisfied that the disabilities can be removed by i imposing f a duty of-.4d. per lb. on ^territorial /rubber, thus placing it on the same. basis as cither rubber. The money derived from these duties will be paid to the territorial administrations as a grant-in-aid. Such a course will relieve Australian manufacturers from the burden of inflated purchase prices, and the additional primage duty payable ,on the inflated values ; at the same time, it will restore to the territorial grower the full preference of 4d. per lb. This plan is quite acceptable to both planters and manufacturers, and will solve a real difficulty in the rubber trade.
The duty of 4d. per lb. on crude rubber is not a handicap to the manufacturers of motor tyres; they have captured the Australian -market, and, so far, there is no competition from overseas. In gum boots, as in tyres, a large quantity of cotton is used, and manufacturers have alleged thai the competition of Japanese goods in the cheaper grades of gum boots is serious. Investigation shows that the competition i3 not very great; nevertheless, th, matter has been referred to the Tariff Board, whose report is expected in a few clays. That is the only direction in which competition, is indicated, and it is being investigated’.
– I understood that the duty on crude rubber was imposed partly in order to assist returned soldier planters in Papua. Is the Minister proposing a departure from that policy?
– The alteration is being made to save the growers in Papua. As to the foundation garments, mentioned by the honorable member for Darling (Mr. Blakeley), the duties on the made-up articles are 45 per cent, and 65 per cent., which should be adequate for any local manufacturer.
.- Will the Minister promise that action will be taken on this item as soon as the Tariff Board’s report is received? The industry has suffered a severe setback through ; the importations of gum boots that are sold at half the cost of the Australian article. This will result in hundreds of ‘employees being’ dismissed from some of the big mills.
– Oh, no.
– About 150 (employees are’ threatened, with dismissal from.]. the North Australia .Rubber Mills in Queensland, because of this unfair competition.
The same thing applies to the DunlopPerdriau Rubber Company. Both’ these companies have plants capable of supplying all of Australia’s requirements of gum boots, and the admission of large quantities of foreign boots is a serious menace to them. We should keep our people in employment wherever possible, and I ask the Minister to treat this matter as urgent. The North Australia Rubber Mills is one of the largest employers in Brisbane. It employs 570 persons. The business has been built up in the fact of great difficulties, but if it is not given adequate protection promptly, 150 people will be thrown out of employment in Brisbane alone, apart from what may be done by the Dunlop-Perdriau Rubber Company. While their competitors are exempt, these manufacturers have to pay 4d. per lb. on raw rubber, and 7d. a gallon on benzine used in the industry. Only this week a boot manufacturer told me that he had cancelled orders that he had placed with some of the rubber factories, because of the huge importations of cheap gum boots from Japan.
– How often did we hear the honorable member for Capricornia (Mr. Forde) say when he was Minister for Trade and Customs, “ This duty will give work to thousands of people”? Nevertheless the totals of the unemployed mounted almost daily. Now, when the country is again on a financial footing, and more people are employed, be states in respect of every duty that, because the protection afforded to the industry concerned is inadequate, people have been or will be thrown out of work. We must take these statements for what they are worth. I repeat that the tyre market has been secured by the Australian manufacturers, and that only in “ the _ cheaper lines’ of gum boots is foreign competition being felt. The manufacturers have had an opportunity to state their case to the Tariff Board, whose report will be available in a few days. This Government would deeply regret if men were thrown out of work through the- operation df this duty. Not until we have had ‘a little fiscal peace will we be able1 to see just how ‘“many of these duties will operate, but I am satisfied that, with the alterations that are being made, Australia will have infinitely less unemployment than has been the experience for some years past.
.- I should not have spoken again to this item but for the misrepresentation of the Minister (Mr. White), who claims that all the employment now given in our factories is due to some action by this Government, when, as a matter of fact, it is due almost entirely to the protectionist policy of the Scullin Administration. Naturally, some time had to elapse before the huge accumulation of stocks in our warehouses and retail establishments were absorbed so that local industry could get properly into its stride. As one illustration of the blighting effect of thi3 Government’s policy, I again remind the committee that Bond’s Industries Limited twelve months ago gave employment in its spinning mill to 917 persons ; to-day it is employing less than half that number. The industry affected by this item, is another case in point. Already large numbers of operatives are threatened with dismissal because of these duties. The Minister, in claiming credit for his administration, merely indulges in a number of platitudes. The facts are. that the protective duties imposed by the Scullin Government enabled a large number of Australian industries to be established. Unfortunately, these are now being destroyed by the present Government, and thousands of our people are being thrown out of work.
.- The Minister- has endeavoured to give honorable members the impression that the manufacturers of rubber goods were delighted when this Government reimposed this duty of 4d. per lb. on crude rubber. That is not so. The manager of the North Australia Rubber Mills in Brisbane- is by no means enthusiastic, because a considerable quantity of cheap, rubber goods manufactured ‘in Japan Avas rushed on the market for the last Christmas season, and the whole of his company’s ‘output of beach balls, manufactured at’-‘ a cost of 18s. a dozen, had ;to face Japanese competition at 12s. a dozen. The1 effect of this ‘duty will be to throw out of work a large number of men now employed in the Queensland factory When the Australian industry got protection under the Scullin Administration, the Queensland company commenced the manufacture of gum boots and beach balls, and the number of employees increased from 300 to 570. I have been informed by the manager of the factory that, if the protection given by the Scullin Government had not been interfered with, his company would have been employing 1,000 men before Christmas. Recently manufacturers of rubber goods gave evidence before the Tariff Board in Sydney, and I understand that the report of the board will be presented in the course of a few days. Those who read the evidence can have no doubt as to the nature of the recommendations which the report will contain. The declared policy of this Government is to encourage private enterprise and to cheapen costs of production. The Scullin Government was condemned for having imposed these duties on crude rubber. Everybody knows that drastic action had to be taken because of the huge deficit left to it by Nationalist governments. But that stage in our financial history has passed, and there is now no justification for the continuance of duties that were imposed purely as emergency measures. As we are not producing rubber in this country under white-labour conditions, the duty on this item should be removed altogether. The Minister told the committee that it would help returned soldier growers in Papua. All the rubber produced there is grown by native labour.
– Who are the proprietors of the plantations?
– In 90 per cent, of the cases the plantations are owned by companies, which are exploiting the natives. The statement made by the Minister was intended to mislead the committee. I can assure him that the Dunlop-Perdriau Company .and the North Australia Rubber Mills do not approve of this duty.
.- This sub-item vitally affects a Queensland industry, which I believe it is the duty of every Queensland representative to support. .1 ‘have, visited lithe North Australia Rubber Mills on many i occasions, and I know that what the honorable member for Kennedy (Mr. Riordan) has said is true. When that firm commenced operations, it employed only a few workers; but as a result of the Scullin Government’s tariff its employees now number about 550. In conversation with me recently, the manager complained of the duty on raw rubber. It may be, as the honorable member for Darling (Mr. Blakeley) pointed out, that that duty was first imposed by the Scullin Government in order to obtain needed revenue; hut the conditions which existed at that time do not exist now; and in order that this industry may have a chance to establish itself on a sound footing, this duty should be removed and raw rubber allowed to enter Australia free, as was the case under the 1921-30 tariff.
Sub-items, as amended, agreed to.
Division 13. Paper and Stationery
Item 334, sub-items (el, 2) (si, 2) (v) (x) (Paper).
.- The Assistant Minister (Mr. Guy), who is a Tasmanian, may be able to tell the committee what further developments, if any, have taken place in regard to the establishment of a factory in Tasmania to manufacture paper pulp and newsprint. In his policy speech, delivered at Launceston, the present Prime Minister (Mr. Lyons) said that with a change of government the manufacture of paper would be undertaken in Tasmania. About sixteen months have elapsed since then, but I have not yet heard that the industry. ha3 been established. Supporters of the present Government claimed that a change from the Scullin Administration would restore confidence, and release money for business enterprises, and that this industry would then be established, and would provide employment for about 4,000 Australians in the manufacture of .120,000 tons of newsprint each year. I should like to know what has been done. Has the company been formed? I know that some of the persons who were, interested in the establishment of this Tasmanian industry are experienced in the manufacture- of paper. They sent experts overseas to make inquiries, and they brought to Aus-tralia the nucleus of a paper-making plant. They also carried out certain experiments in Tasmania. There are thousands of trained artisans on the mainland of Australia who would willingly go to Tasmania if they could find employment in this industry. I should like the Assistant Minister to tell us what progress, if any, has been made.
tl0.36]. - The honorable member for . –I —-I . (Mr. Forde) has repeated to-night, almost word for word, what he said when this matter was before the chamber recently. It is true that when the Scullin Government was in office the persons interested in the paper pulp industry in Tasmania were unable to make any headway because of the general lack of confidence in that Administration. The honorable member also knows that there are three different interests in Tasmania concerned with the manufacture of paper in various parts of the State. Now that confidence is being restored, honorable members may expect a definite announcement in the near future that this industry is about to be established, notwithstanding the opposition of the honorable member for Capricornia.
.- The manufacture of paper pulp in Tasmania was a live question when the BrucePage Government was in office, and therefore the Assistant Minister (Mr. Guy) is not justified in claiming that alleged lack of confidence in the Scullin Administration prevented the establishment of this industry. The promise of the then Prime Minister, Mr. Bruce, that a bounty would be paid on the production of newsprint in Australia, led the electors of Tasmania to support his party at the following election. The Assistant Minister knows that there were two factions - there are now probably three - interested in this subject. When I was Minister for Trade and Customs, I met them in conference, but they could not’ come to any agreement regarding the formation of one company. The present Government claims to have restored confidence three months after it took over the reins of government. It has been in office over fifteen months, yet nothing appears to have been done. With two members from Tasmania in the Cabinet, one would expect something to be done to establish this industry.
– When this matter was under discussion last week or the week before, I ventured the opinion that two newspaper groups were in conflict and could not come to an agreement. I was wondering why the establishment of the industry was being delayed, and I made a statement, I admit, erroneously, that there appeared to be a good deal of sham fighting taking place between the two sections of the press, evidently with a view to preventing the industry from being established. I now understand that a third party has come forward and has almost completed arrangements with one of the other parties to establish the industry. I believe that by the middle of this year, they will have to come to some decision not so much in respect of the Federal Government, as in respect of the Government of Tasmania,, in which State each of them has obtained the right to operate in certain areas of timber country.
.- The excise duty on cigarette papers was recently increased to l-£d. for 60 tubes or papers. I ask the Minister whether this duty will deprive the industry of the protection of lid. which was previously granted to it. The imports in the past have been rather considerable, coming chiefly from France. The paper used in the manufacture is imported under bylaw, but the other materials used are of Australian origin. It is interesting to learn that about 4,000,000,000 cigarette papers are manufactured annually in Australia. In 1932, when the Minister first introduced this duty, he estimated the excise revenue from the local industry at £250,000 annually. This, industry has been built up as a result of the protection given to it, and when it is fully developed, I am assured that it will give employment to 400 operatives. Apart from the electric power and gas used, show cards, price cards, stickers, show boxes and cases are -needed in large quantities,- thus affording considerable assistance to the printing industry. Advertising agents, transport workers, clerks and specialty salesmen also benefit from it. I urge the Minister to allow the progressive development of this new industry to continue without further fiscal interference. When these duties have operated for a few months, he might make inquiries to ascertain the effect that they are having upon the industry. The Zig Zag cigarette paper manufacturers have established a branch here, and they and othei-3 are supplying Australian requirements. The industry is giving employment directly to a large number of employees, and assisting other industries from which it obtains its raw materials.
.- The Tariff Board has advanced good and pertinent reasons for the change of duty. The idea of altering the excise is to obtain a little more revenue for the Government. I give the honorable member the assurance that the Government will watch this industry to ascertain the effect of the alteration upon it.
Sub-items agreed to.
Division’ 14. - Vehicles
Item 359, sub-item (d4 a, 6) (Vehicle parts ; .
.- I have become acquainted with the working of this item by reason of the fact that the Ford Motor Company has established its’ principal works in my electorate. The item is rather a peculiar one, and I crave the indulgence of the committee for a short time while I describe briefly the reason why I regard it as something other than what it appears to be at first sight. First of all it is not a two-column tariff, because there is an intermediate duty which finds expression in the sheet of Canadian preferences which has been circulated separately, and under which a- duty of 15 per cent, is imposed on importations of unassembled chassis from Canada. In other directions also, I consider this a rather peculiar item, and I should like to relate its history. As honorable members know, motor cars are not manufactured in this country.- We assemble cars from unassembled chassis, build the bodies, and mate the tyres and a certain number Of relatively small component parts. That has been so ever since the item first appeared in the schedule. Up to 1925, this item consisted of chassis not including rubber tyres, and during the Bruce-Page Administration, up to 1929, the item remained more or less in that shape. Then during the Scullin Administration, it began to take on the rather formidable aspect which it bears at present, in that a large number of relatively small component parts were omitted from the definition of chassis. The word “ chassis “ as normally understood in the trade, is the complete motor car, less the body, but for the purposes of the customs administration, “ chassis “ has been re-defined by taking from it one component part after another, which the Government of the day thought could he manufactured in this country, and each of those component parts has been made subject to a much higher rate of duty than that on the chassis itself.
– Is the honorable member opposed to that?
– No. I am seeking to show that the administration of this item creates a good deal of irritation in the trade generally. Although I do not in general complain of the protection given to these minor industries, I say quite frankly that, in some cases, I regard it as unjustifiable. The item could be recast so as to cause less irritation to the industry, and still be just as effective at as present from the revenue aspect.
The item is linked with item 359 o of group 7, in which the individual items excepted from- the chassis under this item are dealt with separately. A number of these excepted items are at present under the consideration of the Tariff Board, and I hope that its reports will come to hand before very long. A typical case is that of shock absorbers. 1 trust that the board’s report on shock absorbers will be considered by the Government before the committee reaches that item in group 7.
– The report has been received.
– Does the honorable member for Corio desire that shock absorbers shall be imported?
– No. I do not propose to deal with the exceptions at the moment. I shall, no doubt, have an opportunity later to cross swords with the Deputy
Leader of the Opposition in that connexion.
It is a peculiar method of making definitions to eliminate what does not constitute parts of the chassis. The word “ chassis “ begins the item, but then there are the eight or ten lines of exceptions. And they are not the only exceptions, for the Customs Department, for reasons of its own, has set up a further list of exceptions which do not appear in the schedule, and never have appeared in it. The principal items in that list of exceptions are fenders, running boards, speedometers, lamps, and tools. I do not at the moment question the legality of the action of the Customs Department in this connexion, but I can see no valid reason why those items should not be included in the manifold exceptions that appear in the schedule at present. , One of the principal irritations caused by the item as it stands has relation to the valuation of the different articles specified in it. The chassis comes to Australia from overseas unassembled, and is invoiced at a certain price. But, to arrive at the price of the chassis for customs purposes, the excepted items have to be taken off, and valued separately. In the past the Customs Department has not been willing to accept the manufacturer’s valuation of these individual parts, but has placed on them a much higher value, namely, the spare parts or replacement parts value. .1. understand that only last month this aspect of the subject was reconsidered by the’ Customs Department, and that it is now willing to meet the manufacturers to the extent of accepting their valuations. In the past, to get at the value of a chassis which came in under the relatively low duties of free, 15 per cent., and 32£ per cent., one had to calculate the value of the excepted components, and deduct it from the value of the chassis as invoiced by the manufacturer from abroad. I am given to understand that, in the case of one popular make of motor car, the items listed as exceptions from the chassis constituted something like 60 per cent, of the total value of the chassis, which means that only 40 per cent, of the chassis value came in at the relatively low Canadian rate of duty of 15 per cent., while the excepted items were subjected to very much higher rates, up to 75 per cent., or the equivalent of over 100 per cent., if the fixed rate of duty were taken on the ad valorem basis. The principal burden of my complaint is the irritation and relatively enormous amount of accountancy work involved in calculating the duties under the item as it stands.
– Would this item apply to the Ford product?
– It is particularly in respect of the Ford, which is a typical illustration, that I am speaking.. The chassis comes in under the Canadian duty of 15 per cent.
I make an earnest appeal to the Minister to see whether something cannot be done to simplify this item, not necessarily in the way of reducing the amount of revenue which the department gathers from it, but by reducing the irritation factor as it relates to the importers of chassis. Probably the best way of arriving at a more satisfactory position, though I do not want to teach the Customs Department its business, would be to hold a conference with the leading importers. This is essentially a very technical subject, and one that cannot appropriately be threshed out in this chamber. The Ford Motor Company has expressed the utmost willingness to co-operate with the Customs Department in trying to arrive at some equitable and, at the same time, simpler method of implementing the item. If the Minister, in his wisdom, thinks that this is one of the cases that should be referred to the Tariff Board, I should be agreeable to that. I refer not to the excepted components, some of which are now before the Tariff Board, but to item 359 d, 4a, with which we are now dealing, on which I think the Tariff Board may be able to offer valuable advice in respect of its simplification.
Vice has been aptly defined as a practice to which the individual is not himself addicted. The Deputy Leader of the Opposition (Mr. Forde) quite clearly regards it as a cardinal vice to refer any tariff item to the Tariff Board, while we on this side of the chamber think otherwise. We think that the non-reference of tariff items to the Tariff Board constitutes a vice. For my part, I make bold to say that I regard the Deputy Leader of the Opposition as a fiscally vicious fellow, while he on his part is no doubt perfectly within his rights in regarding us on this side of the chamber as equally vicious fellows. I feel quite sure that before the honorable gentleman retires to rest each night he includes members on this side of the chamber in his prayers, and invokes divine protection for us.
– The honorable member’s remarks are irrelevant to the question before the Chair.
.- I was surprised to hear the honorable member for Corio (Mr. Casey) say that I considered it a vice to refer items to the Tariff Board, because, while I was Minister for Trade and Customs, I referred practically every item to the Tariff Board.
– But how many of the board’s recommendations did the honorable gentleman accept?
– I should have said that the honorable gentleman took very little notice of the board’s recommendations.
– It is true that I did not accept all the recommendations of the board. The Tariff Board is a body created by this Parliament, and when this Parliament, or the Cabinet, or the Minister, hands over to the board the responsibility of saying what degree of protection should be adopted for the industries of this country it is a delegation to the board of powers which should be vested only in the Cabinet and the Parliament. The Tariff Board is an advisory body, and it has its uses in that connexion.
– I ask the honorable member to deal with the item before the Chair.
– I was replying to criticism by the honorable member for Corio. The honorable member for Corio has referred to me as being a fiscally vicious protectionist; but that is preferable to being like the honorable member, who, though a freetrader, masquerades as a protectionist in a protectionist electorate. I have no objection to this item being simplified if the Minister can do so without reducing its protective incidence. Some thousands of men are engaged in the manufacture of motor car parts in Australia. Unfortunately, the time has not yet arrived when our population and local market are large enough to warrant the manufacture of engines for motor cars in this country. Therefore we. must allow engines and bare chassis in at a revenue duty, because they constitute the peg on which the important local industry of manufacturing motor parts hangs. Thousands of employees are engaged in the manufacture of these parts. When the Scullin “Government was in office, and. when our trade balance with the United States of America was unfavorable, an agitation arose for the total prohibition of the importation of motor cars; but it was thought unwise to throw out of employment the thousands of men who were engaged in the manufacture of parts. My advice to the Minister is that he should not have the duty on these parts reduced. The Tariff Board has a changed outlook to-day because of the Ottawa agreement, and I fear that any reconsideration of this item by the board might result in further unemployment.
.- The protest made by the honorable member for Corio (Mr. Casey) was a pertinent one. The growth of the manufacture in Australia of spare and component parts for motor cars has created difficulties in the departmental classification of these parts. Recently a new regulation was issued which found favour with the manufacturers, and simplified the classification; but I agree with the honorable member that much more could be done in the matter, and I would welcome a conference such as he has suggested. This item, and most of the parts to which the Deputy Leader of the Opposition (Mr. Forde) has referred, are now under consideration by the Tariff Board. The Government desires to keep as many men as possible in employment. It claims to have a sensible outlook on tariff matters generally, and it is guided by the expert Tariff Board.
Sub-item agreed to.
Division 16.: - Miscellaneous.
Items 367 and 369 agreed to.
Item 408, sub-item (a) (Outside packages u.e.i.).
.- I am concerned about the duties imposed on the containers in which bitumen and other materials used for road construction are imported. It is impossible to remove the contents of these containers without destroying the containers themselves, and on them there are ad valorem duties of British 20 per cent., and foreign 30 per cent. I urge the Minister to remove these duties, because, as was pointed out in this chamber recently, the people already pay taxes to provide the money with which road construction is carried out. The revenue of the local governing authorities has been seriously reduced in the last two or three years, and they are hampered seriously because of the high cost of road-making material, owing to the increased duties.
– This is a revenue item that was introduced by the last Government, and the revenue whichit produced last year amounted to £95,202 ; but I am inclined to agree with the honorable member that it probably was not intended that bitumen containers, which have to be destroyed Tn order to remove the contents, should carry duties of 20 per cent, and 30 per cent., seeing that it is said they are worth about 60 per cent, of the value of the contents. In view of that fact, and seeing that the municipal and other local governing authorities are experiencing difficulty in financing their road construction and maintenance work, the Government will consider whether this item can be dissected, with a view to the granting of the relief sought.
Sub-item agreed to.
Remainder of division, viz., items 413 and 434, agreed to.
Motion (by Mr. White) agreed to -
That the consideration of the remaining items other than those specified in group 5 in the Customs Tariff memorandum (showing rates of duty under various tariff proposals) circulated by the Minister for Trade and Customs, be postponed until after the consideration of the items specified in group 6.
– I move -
That the House do now adjourn.
Speaking on the adjournment on the 28th March, the honorable member for Darling (Mr. Blakeley) suggested that the Government should seriously consider the printing of the 1927 and the 1928-29 reports on the fisheries industry furnished by the Development and Migration Commission. As I promised, the suggestion has received the consideration of the Government, but it has been ascertained that the reports mentioned have already been widely distributed in multigraph form. I am also informed that they are out of date in certain particulars, and for this reason as well as for the other, it is not considered that the substantial expenditure which would be involved in printing the reports would be justified.
On the same day, the honorable member for the Northern Territory (Mr. Nelson) referred to the relations between China and Australia in connexion with the Boxer Indemnity Fund Act. - The honorable member said that there was need for this Government to make representations to the Government of the United Kingdom in order to permit the use of moneys available under that agreement for the purchase in Australia of railway sleepers for China. Inquiries have been made into this matter, and it has been found that no amendment of the act referred to is required. The honorable member said that under the act purchases must be made with the money in the United Kingdom. That was an inaccurate statement. The arrangement made in 1930-31 was that all sums paid to Great Britain on account of the Boxer Indemnity were to go to the Chinese Government Purchase Commission, and were to be applied, half for the purchase of plant, machinery and material in the United Kingdom, and half for other purposes mutually beneficial to China and the British Empire. The whole or part of this second half, therefore, is available, ‘if the Chinese authorities desire, for the purchase of railway or other material in Australia. It is a matter for the Chinese authorities to determine, but the Commonwealth Government has taken steps to bring to its notice that supplies of sleepers are available here, and this has been done through the agency of the Consul-General in Shanghai, and through Sir Herbert Gepp. In the last twenty months 113,316 sleepers valued at £22,935 have been exported from Australia to China.
.- Recently I asked the Acting Leader of the House (Mr. Latham) a question relating to the duration of the Easter recess. In the Canberra Times of to-day’s date, the following appears : -
An intimation that the duration of the Easter recess of the House of Representatives would depend entirely upon the progress made with the tariff debate before Thursday, 6th April, upon which date it has been decided the House will adjourn, wag given by the Acting Prime Minister (Mr. Latham) last night.
It had been tentatively .decided that the House of Representatives would re-assemble on the 20th April, but there is a feeling in some quarters that the adjournment should be for more than three weeks. “ Although the Government would not be adverse to a longer recess,” said Mr. Latham, “ we are anxious to push on with the tariff and pass it on to the Senate. We know that members are feeling the strain of the four days’ sitting a week, and whether these will be continued after the recess will depend also upon the progress made with the tariff debate.”
Mr. Latham declined to state whether the Government considered the progress made to date was favorable.
I sincerely hope that the Acting Leader of the House will not agree to a longer recess than three weeks. I represent a constituency, the southern boundary of which is 1,350 miles from Canberra, while the northern boundary is 2,300 miles away. When I visit my electorate I have. therefore, to travel 2,300 miles to Thursday Island. I consider it part of my duty to go there, and the only time during which it can be visited is in the cool weather, not because I object to the heat, but because during the hot weather the excessive’ rains put a visit out of the question. If we have a long recess at Easter the consideration of the tariff will be delayed, and I shall not have an opportunity to visit my electorate during the cool weather.
This morning I asked a question relating to preference to returned soldiers and the Leader of the House informed me that preference to soldiers was the policy of the Government. I asked him whether the Government, when appointing members to the Royal Commission on Petrol Prices, had given consideration to the claims of returned soldiers. His reply was that men with particular qualifications had to be selected. Members of the legal and accountancy professions were not backward in offering their services during the war, and there must now be returned men possessing the qualifications for appointment to this commission. The honorable gentleman’s reply can only be construed to mean that, in the Opinion of the Government, no returned soldiers among our accountants or lawyers are qualified for the position. As I suggested this morning, it is a case of sardines for the returned soldiers, and trout for the others. When a job at £3 14s. a week or pick-and-shovel work is offering, the returned soldiers are called in, but when anything worth while is to be had they are overlooked. I know accountants and lawyers who are returned soldiers, and who are fully qualified for appointment to this commission. At least that is my opinion, and I believe that their claims should have been given consideration.
.- I also request the Government not to make the Easter adjournment longer than three weeks. I do not think that any of the representatives of Western Australia will return to their State during the Easter holidays.. Like honorable members from other distant States they will be marooned during the holidays in one of the adjacent capital cities, and I appeal, therefore, to the Government riot to prolong the recess.
– I desire to bring under the notice of the Postmaster-General (Mr. Parkhill) the unsatisfactory nature of the accommodation provided in several of the postal ‘buildings in and around Brisbane. Some of them are a disgrace to the city. I appreciate what has been done by the Postmaster-General in the way of renovations at the General Post Office and the employees also appreciate it. Recently, however, I made it my business “to pay a visit to the Fortitude Valley Post Office, and I hope that the PostmasterGeneral will also take an opportunity to visit it. I satisfied myself that the conditions under which the employees of the Fortitude Valley Post Office work are a disgrace to the department. My visit occurred during the rammer months, and I found the employees partaking of their lunches. No accommodation was provided for this purpose, and they had to eat as best they could, sitting on racks and benches. The drinking facilities provided are most primitive; no filter is available, the employees having to draw water from a tap in the yard, which is exposed to the burning heat of the sun. No proper “ place is provided for employees to wash, nor are towels available.
I also visited, during the summer months, the parcels post department, which is situated in Elizabethstreet at the back of the General Post Office. There I found tha conditions under which the employees work even worse than those of Fortitude Valley. The roof of the building is exceptionally low, and employees are subjected to the terrific heat which prevails in Brisbane with very little protection. Again there were no luncheon facilities, except those provided by a cellar, the stench of which was abominable. I attach no blame’’ to the officials of the Brisbane Post Office for the existing conditions. I have tha highest regard for those gentlemen, who have always acted sympathetically towards their subordinates, and have been only too ready to render what assistance they could. However, they cannot rectify matters, because the Postmaster-General or his department will not sanction improvements which have been recommended from time to time. It is many years since Brisbane has been honoured by a visit from a Postmaster-General, and I urge the honorable gentleman personally to inspect existing postal conditions in that city during the coming adjournment. I assure him a hearty welcome.
.rI listened with great interest to the remarks of the honorable member for
Brisbane (Mr. George Lawson). I am bound to confess that the policy of the Postal Department, not only under my administration, but also under that of my predecessors, has been to render service to the community by providing adequate postal facilities rather than by expending money on additional buildings. However, that does not exonerate the department from not providing reasonably good quarters in which employees can work. In common with every other honorable member, I recognize that, in order to obtain that measure of efficiency which is necessary from a huge organization such as a department which employs 22,000 out of about 26,000 federal civil servants, it is essential that employees should work in comparative comfort, and under conditions which are at least healthful. I assure the honorable member that the matters to which he has drawn attention will be investigated, and that proper conditions will be provided so far as is possible. The honorable member used strong terms in describing some of the buildings. Naturally, that is a matter of opinion. Since becoming Postmaster-General, I have visited all of the general post offices, except those in Hobart and Brisbane. I hope to visit the latter city during the. coming recess, when I shall personally investigate the matters referred to by the honorable member. In the meantime, I shall peruse his remarks in Hansard, and have a report made thereon.
– With reference to what has been said as to the length of the Easter adjournment, the Government, as is well known, wishes to please honorable members, and if they were able to agree as to what would suit them in this matter, it would be easy for the Government to fall in with their desires. We have passed four out of the eight groups of the Tariff Schedule as submitted to Parliament. If the other four are passed by Thursday next, it will probably be possible to arrange a longer adjournment than is now contemplated, which will enable honorable members to travel even thousands of miles to visit their constituencies. The length of the adjournment will depend entirely upon the pace at which the House works. At present the Government considers that the three weeks already mentioned would be the best.
Question resolved in the affirmative.
House adjourned at 11.30 p.m.
The following answers to questions were circulated: -
y asked the Treasurer, upon notice -
Mr. Lyons (through Mr. Latham). - A reply to the honorable member’s questions will be furnished as soon as possible.
en asked the Minister for Trade and Customs, upon notice -
When will the gold bounty, the period for which terminated on the 30th September last, be made available to gold producers?
– The rate of bounty payable in respect of the period cannot be determined until the Commonwealth production of gold during 1932 is known. The final figures of production are not yet available, but are expected at any time. As soon as they are received steps will be taken for prompt payment of bounty.
en asked the Prime Minister, upon notice -
As it is estimated that approximately £6,000 will be collected in customs duty on Fijian bananas, and it is proposed by the Government to set aside the money in order to assist the banana industry, will he take steps to see that a portion of the amount is allocated to the Gascoyne district of Western Australia, where great efforts are being made to establish the industry?
Mr. Lyons (through Mr. Latham). - The Commonwealth Government has agreed to allocate for the purpose of assisting the Australian banana industry the amount of duty collected upon imported bananas. As this duty will be collected from time to time during the year, it has been arranged, in order to avoid delay, to make available as and when required an amount of £3,000 by way of an advance against the equivalent of customs duty that may be collected during the year 1933. Of that sum, £100 has been definitely allocated to Western Australia by the Commonwealth Banana Committee. The Government of Western Australia has been asked whether it desires to administer this provision of £100 or whether it would prefer the committee to administer it on behalf of the industry in Western Australia. The sum of £1,500 out of the total of £3,000 has been allocated for scientific work including transport, packing, maturation, and diseases of handling and transport, thrip and beetle borer. The results of these scientific investigations should benefit the industry throughout Australia.
en asked the PostmasterGeneral, upon notice -
– The answers to the honorable member’s questions are as follow : -
Cite as: Australia, House of Representatives, Debates, 30 March 1933, viewed 22 October 2017, <http://historichansard.net/hofreps/1933/19330330_reps_13_138/>.