13th Parliament · 1st Session
The House of Representatives on the 6th April, 1933, adjourned until a day and hour to be fixed by Mr. Speaker, and notified by him to each honorable member. The House met pursuant to such notification.
Mr.Speaker (Hon. G. H. Mackay) took the chair at 3 p.m., and read prayers.
– I ask the Prime Minister whether the Commonwealth Government has been informed of the result of the discussions between the Prime Minister of the United Kingdom and the President of the United States of America? If so, can the right honorable gentleman make a statement to the House on the subject?
– The Commonwealth Government is not aware of any results of the conversations between representatives of the Governments of the United Kingdom and the United States of America, but, through the Resident Minister in London, is keeping in close contact with the British Government, and is taking the necessary steps to ensure that the particular circumstances of Australia shall be kept in view.
– Can the
Prime Minister inform the House of the intentions of the Government in relation to the relief of the dairying industry? What action does the Government propose to take to extend our trade in dairy produce with the Far East?
– It is not customary to announce government policy in reply to questions.
– I ask the Minister for
Commerce whether the Government intends to adopt the recommendation of the Australian and New Zealand Dairy Produce Export Control Boards that the export of butter to the United Kingdom be not restricted ? In view of the depressed stale of the British market due to huge importations of Danish butter, will the Commonwealth Government request the British Government to adopt the proposal of the New Zealand Government that imports of foreign butter into the United Kingdom be restricted to 25 per cent. of the total imports?
– The Prime Minister announced some time ago that the Government would be guided by the advice of the Australian Dairy Produce Export Control Board. That body has recommended against the restriction of exports of butter, and the Government has adopted its recommendation.
– As the approaching winter is likely to be severe, I ask the Prime Minister whether the Government intends to distribute surplus military clothing and stores for the relief of the unemployed ?
– In the absence of the Assistant Minister for Defence, I undertake that inquiries will be made to ascertain what can be done.
– In view of the desire of the Tasmanian Tourist Associations to foster the development of the tourist facilities in that State and the need of the shipping companies to arrange their services in advance, will the Minister for Commerce give the House an assurance that the exemption from the coastal clauses of the Navigation Act granted last year will be continued next summer?
– The justification for the exemption granted during the recent summer was the inadequacy of the licensed services. While that condition of inadequacy continues, the exemption of overseas vessels from the coasting provision of the Navigation Act will be justified. The exemption will be continued next summer.
– Has the Minister for Trade and Customs received the Tariff Board’s report on the incidence of exchange and primage?
– The report has just been received. The Government has not yet had time to consider it.
– Has the Prime Minister any announcement to make to the House regarding the proposed constitution convention of which the country is anxious to learn details?
– I have communicated with the Premiers of all the States, pointing out that the forthcoming meeting of the Loan Council, and possibly a conference of Premiers, will afford an opportunity for the representatives of the State Governments to express their views in regard to the amendment of the Constitution. I have not received replies from all the State Premiers, but I hope that all will agree to the matter being discussed at the meeting of Commonwealth and State Ministers with a view to the setting up of a convention to deal with the matter exhaustively.
– Has the Prime Minister anything further to communicate to the House with reference to the proposal to set up a non-political body to inquire into and report upon the disabilities of the States?
– It is the intention of the Government to set up such a body at an early date, but careful consideration will have to be given by the Government to the personnel of that body.
– Does not the Constitution specifically provide for the appointment of an Interstate Commission? If so, will any committee or commission which is established, be appointed on the basis of an Interstate Commission ?
– The proposed body will not be an Interstate Commission, mainly for the reason that the duty of an Interstate Commission is primarily, not to safeguard the rights and privileges of States, but to supervise the administration of federal law. The decision of such a body might, for instance, have the effect of vetoing a State law, but not a Federal law. Therefore, it could not give any real protection to the States. The object of the Government in setting up this body is to investigate the difficulties of the smaller States, so as to arrive at some satisfactory and permanent method of meeting their disabilities from year to year, instead of throwing upon the State Treasurers the responsibility of going, almost cap in hand to the Commonwealth for assistance, and at the same time encroaching upon the security of the Commonwealth Treasury.
– Is the PostmasterGeneral able to state when and where the proposed wireless broadcasting relay stations will be established?
– by leave - Whilst a very large percentage of wireless listeners are in areas in which reception from one or more stations may be regarded as reasonably satisfactory, a considerable number of listeners are not well served, and a still greater number of people have refrained from taking out licences because, in the locations where they reside, the broadcasting service is almost ineffective. - It is admitted that there is cause for dissatisfaction, and that special efforts must be made to remedy the existing deficiencies of the broadcasting services. The extension of the service areas was checked solely by the nation’s economic disabilities. The Government of the day found it necessary to cancel work which had already been embarked upon and, since that time, the financial position has made it impracticable to allocate large sums of money for development purposes. This Government has, however, decided that an expansion of these services must take place at the earliest possible moment, and the PostmasterGeneral’s Department is revising the studies on which the future technique of Australian broadcasting will be based. The amount of money to be invested in the ultimate plan, the great economic influence which a particular policy might exert in the broadcasting sphere, and the far-reaching effects upon listeners, emphasize the need for moving with the greatest caution and in conformity with the best scientific knowledge which the world has to offer.
Naturally, there are differences of opinion as to the best course to pursue, and the time now being occupied in a final impartial survey of an exceedingly complex problem in the light of the most modern development, will undoubtedly be justified. The ground work has been completed, and all that remains to be done now is to sum up the pros and cons of the relevant factors. This review will take a few weeks, but when it is completed, there should be nothing to retard progress to the construction stage.
– Does the embargo which Great Britain has imposed against Russian goods extend to Australia; if so, could the Government delay action in the hope of bringing about a peaceful settlement of an unfortunate occurrence ?
– The embargo which Great Britain has imposed against Russian goods does not extend to Australia.
– Has the attention of the Minister for Commerce been drawn to an article which appeared in the Sydney Morning Herald of last Monday to the effect that the London Daily Express has stated that Argentine beef is swamping the British market and that the Argentine importer is getting from f d. to lid. per lb. more than before the beef quota was established? Can the Minister give any guarantee that some remaining shred of the Ottawa agreement will operate in favour of the Australian meat industry ?
– My attention has not been drawn to the paragraph to which” the / honorable member has referred, but I can assure him and other honorable members that the Ottawa agreement is working very beneficially in the interests of dominion producers.
– Has the Minister noticed a report in the press to the effect that the Argentine is exporting beef to Great Britain as offal, in that way flouting the restrictions imposed on the quantity of beef that may be exported from that country to Great Britain?
– It is true that an attempt was made to get behind the Ottawa agreement in connexion with the export to Great Britain of Argentine beef, bagged and frozen, but effective and appropriate steps have been taken to stop it. Such a practice, however, could not apply to the major exportation of Argentine meat, which is chilled. The Ottawa agreement is specific in respect of bagged chilled beef.
– Is the Prime Minister aware that a brand of petrol which is sold in Sydney at ls. 8d. a gallon is selling in Canberra at 2s. 3d. a gallon? Will he make inquiries .to ascertain the reason for this disparity in the prices?
– I shall be glad to make that inquiry on behalf of the honorable member.
– Does the date of the contract entered into for the northwest aerial service in Western Australia expire in June next? If so, what steps are being- taken to renew the contract ?
– I shall obtain that information for the honorable member.
– Can the Minister for the Interior inform the House of the probable date of the gazettal of the Workmen’s Compensation Ordinance for the Federal Capital Territory?
– I cannot inform the honorable member of the exact date, but the gazettal will take place probably in the course of the next few days.
– Is the Prime Minister in a position to make a statement about the success or otherwise of the representations of the Resident Minister in London for the reduction of Australia’s oversea indebtedness ? If not, can he say whether the Resident Minister is continuing those representations?
– I am not in a position to make such a statement at the present juncture, nor would it be advisable to do so in advance of any action that may be taken; but I can assure the honorable member that the matter is being closely attended to by the Resident Minister in London, and when possible I shall make a statement on the matter.
– In connexion with the proposed visit of the Minister for Health to New Guinea, are two press representatives making the trip at the invitation and expense of the Government?
– No press representative is making the trip to New Guinea at the expense of the Government. Whether the Minister has suggested to. the press that it might be represented on the trip is another matter.
Assistance to Unemployed
– In view of the fact that a quantity of British coal dumped at Newcastle is gradually deteriorating because of exposure to the weather, will the Prime Minister instruct the officer in charge of the dump to release some of the coal so that the unemployed may have a little warmth during the coming winter ?
– I shall inquire into the matter, to ascertain whether anything can be done in the direction suggested by the honorable member.
– by leave - I desire to inform the House that, during the absence of the Minister for Health and Repatriation (Mr. Marr), who will leave Sydney for New Guinea to-morrow, the Postmaster-General (Mr. Parkhill) will assume the duties of Minister for Health and Minister-in-charge of Territories, and the Assistant Minister for Defence (Mr. Francis) will act as Minister for Repatriation.
High COURT Judgment.
– In view of the recent decision of Judge- DrrakeBrockman in the High Court, in regard to an award covering Commonwealth employees, will the Minister for the Interior inform me whether the amount of arrears due to the employees concerned will be paid to them next pay day?
– The whole matter is now under consideration.
– Will the Treasurer inform me whether Australia is likely to obtain any benefit in. respect of the substantial interest payment due by her in New York next Monday in consequence of the United States of America having gone off the gold standard?
– At present I can hold out no hope to the honorable member that there will be any reduction of interest payments. This is a subject on which a statement of policy cannot be made just now. This Government is acting in the closest co-operation with the British Government in these matters, and the special circumstances of Australia are being kept under consideration.
– Will the Prime Minister make an inquiry, and inform me whether Major Maurice, Commanding Officer of the 1st Cavalry Division of Signallers, has invited citizens serving in that division of the Citizen Military Forces to become members of the New Guard? Will the right honorable gentleman also ascertain whether any such citizens have become members of that organization upon the recommendation of this officer?
– I shall bring the honorable member’s question under the notice of the Minister for Defence with the object of having an investigation made into the subject.
– In view of the fact that the Government of the United States of America and also the governments of other countries are now taking action with the object of restoring price levels and stimulating general business activities, will the Prime Minister discuss with the Cabinet the advisability of pushing on with the necessary banking legislation so that it may be introduced as soon as possible with the object of giving the Commonwealth Bank Board whatever legal power may be needed to enable it to take the steps it thinks desirable to raise prices in Australia ?
– The circumstances of today are such that it would not be wise at this juncture to make any alteration in the control of the Commonwealth Bank. The conference which is taking place at present between the Prime Minister of England and the President of the United States of America is only a preliminary 10 the great world conference which is to be held in London. The holding of these conferences shows the necessity for acting with caution. It would not be wise to do anything hurriedly in the direction suggested by the honorable member. This Government will do whatever may be necessary to be done after the world conference has been held, and I hope that something will be done at that conference in the direction indicated by the honorable member - to co-operate with other governments with the object of improving the position of the world.
– Do I understand - from the statement of the Prime Minister that the announcement by the AttorneyGeneral respecting the introduction of banking legislation was somewhat premature ?
– No; the announcement of the Attorney-General was in similar terms to those which I have just used. I think that the right honorable gentleman made it clear, that as a world conference was to take place, there was no necessity to take action prior to the holding of the conference.
– Will the Minister for Trade and Customs be good enough to ascertain, and to inform honorable members as early as may be convenient, of the number of protective duties on British imports which were increased or reduced by the Bruce-Page Government, and the number of such duties that have been increased or reduced by this Government?
– I shall be pleased to give attention to the request of the honorable member.
– In view of the High Court judgment in relation to the Queensland Peanut Board, I ask the Prime Minister whether he will approach the Government of New South Wales with a request that it shall abolish many similar boards which have been established in that State?
– I shall certainly not do so.
The following papers were presented : -
Air Force Act - Regulations amended - Statutory Rules 1933, No. 46.
Contract Immigrants Act - Return for 1932.
Defence Act - Regulations amended - Statutory Rules 1033, Nos. 49, 51, 53.
Financial Relief Act - Regulations (Primary Producers’ Assistance - Wheatgrowers’ Relief) - Statutory Rules 1933, No. 48.
Immigration Act - Return for 1.932.
Lands Acquisition Act - Land acquired at Cootamundra, New South Wales - For Defence purposes.
Naval Defence Act - Regulations amended - Statutory Rules 1933, No. 50.
Patents Act - Regulations amended - Statutory Rules 1933, No. 52.
Public Service Act - Regulations amended - Statutory Rules 1933, Nos. 42, 43, 44, 45.
Seat of Government Acceptance Act and Seat of Government (Administration) Act - Hospital Tax -Ordinance - Regulations amended.
Mr. WHITE laid on the table reports and recommendations by the Tariff Board on the following subjects: -
Articles n.e.i. partly or wholly made up from Textiles or Feathers, and Articles n.e.i. partly or wholly of Felt.
Oilmen’s Stores and all goods covered by Tariff Item 79.
Ordered to be printed.
In Committee of Ways and Means: Consideration resumed from the 6th April (vide page 934), on motion .by
And on motion by Mr. White (vide page 29)-
Group 6. - Amendments made by the present Government which are supported by Tariff Board reports.
Item 105, sub-items (a1 b), (aa2), (f1, 2, 4). 105. Piece Goods, viz.: -
.- The duties in this item have been severely reduced: from1s. 3d. and 2s. 6d. and 35 per cent. and 50 per cent. for over 5 oz. per square yard to 6d. and1s. and 20 per cent. and 40 per cent. per square yard, and the new duties apply to all cotton tweed of over 3 oz. in weight. This represents a cut of approximately 50 per cent. in the fixed rate of duty on cotton tweeds of over 5 oz. in weight. The cotton piece goods industry, which is engaged in the manufacture of cotton tweeds, has developed largely in Australia during the last two or three years and, in fact, since the protective duties provided in the Pratten tariff were imposed in 1926. Those engaged in this industry have never availed themselves of the high duties to exploit the Australian public. On the contrary, the price of Australian cotton tweed has been steadily reduced. This industry is not confined to one State ; it is carried on in both New South Wales and Victoria. The Victorian mills alone, for the year 1931-32, turned out 654,267 yards of cotton tweed valued at £102,000. They employ 185 persons, and distribute about £30,000 in wages annually. Their capital outlay is £90,000, while their buildings, plant and machinery are worth £33,000. There are also three large mills in Sydney, in which the capital employed is £85,000. Their lands, buildings and machinery are valued at £50,000, and the number of their employees is 112, the wages paid totalling £17,000 a year. The industry uses large quantities of cotton yarns which are manufactured in Japan and the United Kingdom, and I am assured by those who are in a position to speak authoritatively on the matter that the plant employed is thoroughly up to date. A new cotton-spinning mill was recently established in Sydney by Bradford Cotton Mills Limited, which company has also a cotton-weaving mill, the object being to meet its own requirements in coloured cotton yarns for the manufacture of cotton tweeds. The rates of duty now in operation are, I recognize, those recommended by the Tariff Board on the 30th September last, after it had made inquiries into the matter. Of course, it is useless to ask this Government to raise the duties above the rates recommended by the board, for it has already tied its hands in that regard by the Ottawa agreement, which, if carried out to the letter, would prevent the Government, unless it appointed a different board, or amended the act altogether, from increasing the duties over the present rates. The Ministry will adhere to its present line of action, notwithstanding the employment position in these industries. I fear the huge importation of goods from eastern countries, notably Japan, which is to-day paralyzing the secondary industries of many European countries, causing the partial closing of their factories. For the six months ended the 31st December, 1931, the imports into
Australia of apparel, textiles and manufactured fibres were worth £986,000, while for the corresponding period of 1932, they were valued at £1,420,000, an increase of about £500,000. Mr. Percy C. Pish, chairman and managing director of J. F. and H. Roberts Limited, speaking in Manchester in January last regarding the importation into Australia of piece goods from Japan, said -
Cotton and artificial silk goods from Japan on the Australian market are a menace to the Lancashire manufacturers, because the competition is one that cannot be met. We have had samples sent home illustrating quite clearly that Japan’s prices beat us by more than 75 per cent. ; in fact, the raw materials used in the manufacture of some of these particular Japanese goods could not be purchased even by Japan for the price at which the manufactured goods are landed in Australia. Therefore, it goes without saying that Japan must be losing heavily on the transaction, and it is reasonable to suppose that the mills of Japan are heading for disaster. But, unfortunately, in the meantime, many legitimate traders are forced out of business.
– Australian manufacturers do not make those goods.
– They make cotton tweeds down to 3 ounces, and these are dutiable under the item that I am discussing. They have been manufacturing cotton tweeds since the introduction of the Pratten tariff.
– It would be a fairly thin tweed that goes only 3 ounces to the yard.
– Yes; but I am assured that the Japanese manufacturers are able to produce tweeds even lighter than that. When the tariff protection applied to tweeds over 5 ounces to the yard, the Japanese at once reduced their weights, and secured a market formerly supplied by Australian manufacturers.
The cotton tweed industry is linked up with the cotton yarn industry. While coloured cotton yarns for the manufacture of cotton tweeds are allowed to come in from J apan, and to be sold to the Australian weavers in competition with the coloured yarns turned out by the Australian spinning mills, the Australian weaver who wishes to spin his own yarns and use them in his own weaving mills is placed at a distinct disadvantage. The Bradford Cotton Mills in Sydney have installed a plant which cost £60,000, and they give employment to a large number of persons in making yarn suitable for the manufacture of tweeds; but their competitors in other States are buying coloured yarns from Japan at low prices, with the result that the Sydney company is forced to import coloured yarns from Japan and allow its own spinning mills to remain idle. The following figures indicate the large quantities of cotton yarns that have recently been imported : -
The importations of mercerized yarns increased from 750,000 lb. during the first half of 1932 to 940,000 lb. during the second half of that year. It is regrettable to find that coloured yarns are being brought in from Japan when there are mills in Australia capable of manufacturing them.
– Not the yarns suitable for cotton tweeds.
– Yes. I was informed as late as 9 o’clock this morning that this is so. I am aware that the Minister has given a good deal of consideration to this matter, because some of the spinning mills are in a parlous condition. What action has been taken by the Minister and the Government on the representations made to him by the spinners and the cotton-growers, following upon the conference held in Sydney regarding the necessity for preventing the importation of cotton yarns?
– I made a statement on that matter in this chamber.
– That applied only to mercerized cotton.
– No; it applied to both.
– Do I understand that the Minister proposes to make dutiable all yarns that can be manufactured in Australia ?
– I did not say that.
– The statement made by the Minister referred only to mercerized yarns. The Bradford Cotton Mills have lying idle a large plant that could be utilized in the spinning of cotton yarns, yet the Minister will not make those yarns dutiable. By-law admissions are far too numerous. If adequate protection were afforded against imported yarns and cotton tweeds, the Bradford Cotton Mills alone could employ 500 persons by working a double shift. This firm was given to understand by the last Minister for Trade and Customs (Sir Henry Gullett) that if it were able to supply the demand for all kinds of cot.ton yarns it would be given adequate protection. That protection, however, has not been forthcoming, although these mills can supply all the yarns required for cotton tweeds and other purposes, except possibly the very fine counts of over single fifties, with the result that the imports are increasing, and the local plant is partially idle. Naturally, it is desired that the by-law should be cancelled. The Minister ought to give favorable consideration to this request. Some Sydney mills at one time manufactured and sold for 3s. 9d. a yard a very popular cotton tweed that is dutiable under this item. To-day, however, ?. Japanese cloth of this type, on which a duty of ls. and 40 per cent, is paid, is being imported, and is competing with the Australian article. Those w!>o have studied the question will admit that Mr. Fish knew his book when he stated that the Lancashire firm on whose behalf he spoke cannot possibly compete with the Japanese product. It is said by representatives of the farmers, and by some persons who profess to represent the workers, that any degree of protection means higher prices to the consumer. That, however, has not been the experience in Australia. A comparison of the prices ruling to-day, with those that operated eighteen months ago, will show that there has been an all-round decline of approximately 30 per cent, in the prices of manufactured goods. Nine months ago, the Bradford Cotton Mills, Sydney, an offshoot of an English manufacturing company, had on the market a popular, line of tweed at 2s. 6d. a yard. To-day that tweed is being sold for 2s. a yard. I ask the Minister to take into consideration- the anxiety of this enterprising firm to spin all the cotton yarns required for the ‘manufacture of cotton tweeds. The Government should see that it is adequately protected against the importation of cheap yarns from Japan.
The weaving mills in Australia have also applied for a duty on denims, drills and dungarees, and cloths in the grey. An inquiry into this matter was held by the Tariff Board about two years ago, but at that time it did not feel justified in making a favorable recommendation. I remind the Minister, however, that in the intervening period these factories have undergone considerable development, and have installed a good deal of additional plant. To-day they are able to manufacture the whole of Australia’s requirements of denims, drills and dungarees, and cloths in the grey.
I warn the Minister not to give rulings in regard to these matters that permit of the importation of goods at lower rates of duty than those specified in the -tariff schedule, to the detriment of Australian manufacturers. The Minister recently ruled that a certain cloth was a gabardine, and was not suitable for manufacture into outer clothing. A mill that had commenced to manufacture this material was obliged lo discontinue that operation, because the ruling of the Minister enabled the article to be imported at a lower rate of duty that it was understood would apply.
– What mill is that?
– The Bradford millThe industry has also protested against the ruling of the Minister that a certain cotton tweed is not a cloth that can be manufactured into outer wear. One mill received an inquiry with regard to the supply of 3,000 yards of this material, but when that ruling was given the inquiry was not pressed.
– Had they ever made any of this material?
– They were experts in Bradford, and they are experts in Australia. They have proved that they can make cloths the equal of any manufactured in the world. They have the necessary plant to make this material. They had an inquiry for 3,000 yards of it from George Morgan and Company Limited, Sydney, but as soon as that company found that it could import the cloth at a lower rate of duty it lost interest in the Australian article. Thus the Minister’s interpretation proved detrimental to Australian workmen. Quite a number of other orders would have followed this had the Minister not given a decision which enabled the imported article to be brought in at the rate of 5d. and 25 per cent, under item 105a la, instead of at the rate of 6d. and 20 per cent., and ls. and 40 per cent., under item 105a lb. I am assured by the Australian manufacturers that the making of these denims and drills in Australia would not lead to substantial increases in prices. The denim, double width, that is being sold to-day for1s. 6d. a yard would be sold for 2s. a yard at the very outside, and the Australian material would be far superior to the imported. I hope that the Minister will use every endeavour to provide within Australia as much employment as possible. This is a very important industry, which turns out a product that is used by a large section of the people. The manufacturers have proved that they are not exploiters of the public, but that, on the contrary, they have been responsible for the prices of cotton tweeds being lowered. The Tariff Board, after considering this matter, was fair enough to make the following observation : -
In the past two years, increased local competition and the pressure of the economic position have resulted in reduced prices, and in some cases manufacturers have suffered loss.
I hope that the Minister, who is unable to increase the duties on this item because of the Ottawa agreement, will at least not reduce them still further, for to do so would be to cause disaster to this Australian industry. ‘ Australian manufacturers of cotton tweeds who have established plants to spin coloured yarns in Australia should be protected against cheap imported yarns from Japan. As I have stated, they were assured by the honorable member for Henty (Sir Henry Gullett), when Minister for Trade and Customs, that they would be amply protected, and I hope that the present Minister will see that that is done.
.- I desire to discuss this item, not so much in relation to the general tariff as to the British tariff. Nor do I wish to question the adequacy or inadequacy of the duty; but I am concerned that it may be not in conformity with schedule F, part 1, paragraph c of the Ottawa agreement, which reads -
When goods the produce or manufacture of the United Kingdom are liable to duties of customs exceeding twenty-nine per cent. ad valorem, the difference between the British preferential tariff and the rate upon similar goods from the most favoured foreign country shall be at least twenty per cent. ad valorem, provided that in no case shall this margin be applied so as to result in a rate of duty exceeding seventy-five per cent. ad valorem.
I take it that that provision means that, in the event of our imposing a duty in excess of 55 per cent. against Great Britain, the maximum foreign duty still remains at 75 per cent., in which case there is not a margin of 20 per cent. between the duties on British and those on foreign goods. But it means more than that; it means, also, that in no instance can we have a. foreign duty in excess of 75 per cent. ad valorem. It must mean, therefore, that in no instance can we have a duty exceeding 75 per cent. against Great Britain. If we make the duty 75 per cent. British, the foreign duty cannot exceed that rate. I am concerned to know whether sub-items 105a1b and 105f1 conform to the undertaking entered into at Ottawa. The British preferential duty on cotton piece goods under item 105 a1b is a fixed rate of 6d. per square yard, plus 20 per cent. ad valorem. Only to-day I was informed that certain lines of British cotton piecegoods, which are dutiable under this item, cost the equivalent of10d. per yard or less f.o.b. in the United Kingdom. If my information is correct - and I have no reason to doubt it - the duty represents 60 per cent. on the value, and the additional 20 per cent. ad valorem brings it up to 80 per cent. If we add the 10 per cent. on f.o.b. rates, in order to find a basis for the duty, we bring the rate up to 82 per cent., to say nothing of primage, exchange, and other charges. I take it that schedule F, part 1, paragraph c of the Ottawa agreement compels us in no instance to exceed a duty of 75 per cent. against Great Britain, in which case, if the prices I have mentioned are accurate, it would appear that in this item we are infringing that agreement.
– What material is quoted at10d. per square yard?
– I do not know; but I am informed that there are lines dutiable under this item which can be bought for10d. per square yard. Item 105f1 deals with piece goods, woollen or containing wool. They may be nearly all cotton, with only a few strands of wool in them.
– I suggest that we deal with the sub-items separately, and for the present confine ourselves to sub-item 105 a.
– -Is it the wish of the committee that the various sub-items be taken separately?
– In view of the figures which I have given to the committee, I suggest that the Minister agree to postpone consideration of this item in order that we may ascertain whether or not these duties constitute an infringement of schedule F, part 1, paragraph c of the Ottawa agreement.
– I do. not think a postponement is necessary.
.- I agree with the honorable member for Gippsland (Mr. Paterson) that we should seriously consider whether in these duties we are not infringing the Ottawa agreement. In this item we are dealing with a double-barrelled duty; it is 6d. per square yard British, and 20 per cent, ad valorem. As I pointed out in this chamber previously, many of these duties amount to from 100 per cent, to 150 per cent. The schedule also provides “or ad valorem 35 per cent, and 55 per cent.” What is the object of setting out different ad valorem rates ? Is it to deceive honorable members? As things are, it i3 impossible to know what the duties really amount to. It would be better to have no flat rate, but only an ad valorem duty, for then we should know how matters stood. We ought to strike out the ad valorem duties of 35 per cent, and 55 per cent. If it is the intention of the Government that the duties shall not exceed 35 per cent. British and 55 per cent, foreign, why not say so clearly? At the present time the local manufacturer has, in addition to the natural protection, the advantage of 25 per cent, exchange and 10 per cent, primage. These cotton piece goods are used for making the cheaper clothing bought by the poor. Of course, it is possible that the manufacturers may be allowed to import goods duty free. According to a return furnished to me recently, £6,000,000 worth of goods was admitted in 1930 under by law, free of duty, and duties to the value of £1,750,000 were remitted. The Ottawa agreement prescribes a maximum duty of. 75 per cent., and I ask the Minister to give the committee an assurance that that provision of the agreement will not be vitiated.
.- Are we to understand that the 75 per cent, prescribed in schedule F, part 1. paragraph c of the Ottawa treaty, applies only to ad valorem rates, and not to fixed rates? If that is so, the Tariff Board could drive a coach and horse through the agreement by merely recommending fixed rates in lieu of ad valorem rates. To my mind the fixed rates of duty must conform to the same general principle a3 applies to ad valorem rates. Will the Minister postpone the item in order that further consideration may be given to this, aspect of it?
– I say emphatically that these duties are not an infringement of the Ottawa agreementThere is nothing to prevent the Government from imposing fixed rates in excess of the percentage prescribed in that formula. The Deputy Leader of the Opposition (Mr. Forde) has complained of Japanese competition.
– I have dealt only with British goods.
– British manufacturers are complaining that their goods are being displaced in the Australian market by cotton piece goods from Japan. The honorable member for Swan (Mr. Gregory) has referred to huge admissions of goods under by-law. That is an old obsession on his part. The fact is that the goods thus admitted free of duty were the raw materials used by manufacturers, and machinery required for rural and other industries. Calico, the largest item of cotton piece goods, is admitted free from the United Kingdom, and is subject to a duty of 15 per cent, under the general tariff. The rates proposed in this schedule are an increase on the rates imposed by the Scullin tariff on cotton piece goods weighing from 3 oz. to 5 oz. per square yard. Undoubtedly serious J apanese competition is being experienced in many industries. Even in India where labour is cheap, action against the dumping of Japanese goods is contemplated, and the United Kingdom is considering means of preventing the dumping of Japanese gum boots. Recently, when the the Premier of Queensland referred to gum boots, and the risk that some workers might lose their employment, I stated that this item would be referred to the Tariff Board with a view to the adoption of anti-dumping measures. When a similar situation arises in connexion with cotton piece goods, the Government will take prompt action.
No time need be lost; invoices can be loaded to a reasonable extent so that Japanese goods will not compete unduly with those from the United Kingdom. The Government is concerned, not only to protect Australian industries, but also to retain trade within the Empire, as far as possible. We have no hostility to Japan, which is one of our best customers, buying annually about £7,000,000 worth of Australian wool, but when competition from overseas is likely to displace labour in Australian factories, the Government will consider the adoption of anti-dumping measures. The Deputy Leader of the Opposition (Mr. Forde) stated that cotton piece goods are being manufactured to a large extent in Australia. The Tariff Board’s report, which is of recent date, shows that cotton piece goods weighing less than 5 oz. per square yard are not yet being made in Australia. Preparations are being made to produce the lighter weights, but until the capacity of Australian mills to do this is proved to the satisfaction of the Tariff Board, any further increase of duties would he premature. The fact that the Government has increased the duties on weights from 3 oz. to 5 oz. shows that it is alive to the need for protecting local industries, but the weights of piece goods principally used by the manufacturers of apparel are not yet being produced in Australia. I am aware that a mill in Sydney has installed the essential machinery for the production of the lighter weights of cotton tweeds, but this machinery is not yet in operation. If light-weight cotton tweeds were made dutiable, other mills which use this material for the manufacture of clothing would be penalized. The committee should rest content with the fact that the Tariff Board has exhaustively investigated this item, and that the Government is on the alert to prevent dumping.
.- I support the remarks of the Deputy Leader of the Opposition (Mr. Forde) regarding the importance of the cotton manufacturing industry, its development to date, the employment it affords, and the necessity for maintaining effective protection of it. The honorable member for Gippsland (Mr. Paterson) has raised a very interesting point which will have an important bearing on the Ottawa agreement. I believe that schedule F goes even further than the honorable member indicated.
– I believe that it applies also to duties on foreign goods, although it was not so intended.
– Apparently the intention is that no duty against’ British goods shall exceed 75 per cent., but, as drafted, the provision means that no duty on any goods, British or foreign, may exceed 75 per cent. In applying the 20 per cent, preference, the draftsman has inserted a proviso that in no circumstances shall the margin be secured by imposing duties exceeding 75 per cent, ad valorem. The use of the word “ ad valorem “ might be construed legally to exclude flatrate duties, but if that is the intention the drafting is the loosest I have ever seen. I hope that such an opportunity for the protection of Australian industries has been left, but having watched ths operation of the Ottawa agreement from day to day, I believe that honorable members will soon come to the conclusion that it is unworkable. If the provision in schedule F, that there shall be no duty exceeding 75 per cent, ad valorem, does not extend to flat-rate duties, the whole agreement can be rendered abortive. I think the intention was that no duties should exceed 75 per cent. The honorable member has referred to British piece’ goods costing lOd. per yard f.o.b. The lowest price of which I have heard is ls. 6d. a yard. If British piece goods are being sold at lOd. per square yard f.o.b., and the Ottawa agreement prevents us from imposing a duty exceeding 75 per cent., clearly the agreement is thwarting our protectionist policy, and must be amended at an early date. The honorable member for Gippsland has served a useful purpose by drawing attention to another of the many anomalies in the agreement.
.- The Leader of the Opposition (Mr. Scullin) is afraid that Australian manufacturers may not be able to compete with a maximum protection of 75 per cent., which, with the surcharge, amounts to 82½ per cent. In addition, there are primage and exchange, and the natural protection of freight, insurance, &c. I have obtained some figures relating to British dress pieces. The materials that we are now discussing can be used as dress pieces. Those figures show that in 1931 the duty on materials costing 3s.11d. a yard in England was 8s.11d. a yard. On materials costing 4s. 3d. a yard, the duty was 9s.11d. a yard. On materials costing 2s.11½d. a yard, the duty was 8s. 6d. a yard, and on materials costing1s. 11½d. a yard, the duty was 6s.11d. a yard. The importer does not know where he stands in respect of these double-barrelled duties. These materials are cotton goods, fashioned to represent woollen goods. Why should the people of Australia pay for them three or four times the price at which they are obtainable in other parts of the world ? I move -
That sub-item (a), paragraph (1), subparagraph (b) be amended by adding the following: - “ Provided that no duty or combination of duties be imposed against British goods in excess of 75 per centum ad valorem.”
Question - That the amendment (Mr. Gregory’s) be agreed to - put. The committee divided. (Chairman - Mr. Bell.)
Majority . . . . 16
Question so resolved in the negative.
– I ask the Minister to explain the interpretation placed by the Government upon that part of the Ottawa agreement referred to by the Acting Leader of the Country party (Mr. Paterson), and its application to this particular sub-item, so that we may have a guide as to other items.
– Schedule F of the agreement specifically mentions 75 per cent. ad valorem. I understand that specific duties were not discussed at Ottawa. We cannot protect our industries by the imposition of ad valorem duties alone. How could we expect to protect our industries if goods could be dumped into this country at prices much below their real value, and subjectonly to ad valorem duties? Would such a thing be fair to the Australian manufacturers? The amendment which was moved, doubtless in all sincerity, by the honorable member for Swan (Mr. Gregory), may be misunderstood by the people outside. They may believe that the Government, in voting against it, voted against a provision of the Ottawa agreement. It did nothing of the sort. This Government stands for the review of the tariff by the Tariff Board, and any decision on a snap vote taken on an amendment providing for an ad valorem duty not in excess of 75 per cent. could not be regarded as in opposition to the Ottawa agreement. A proper survey of every Australian industry is being made by the Tariff Board. It has inquired into the manufacture of cotton piece goods, and the Government is accepting most of its recommendations. The report of the Tariff Board, at page 7, shows that the lowest price for cotton piece goods, f.o.b. material, is ls. 4d. a square yard. The ad valorem rate and the rate specified represent infinitely less than a duty of 75 per cent on the cheapest material mentioned by the Tariff Board.
– That does not say that there is no cheaper material. ‘
– The Tariff Board, when making its inquiries, takes every factor into consideration. It is very evident that the honorable member’s contention respecting this sub-item may not apply similarly in respect of other items.
.- The Minister has attempted to place on part of the Ottawa agreement an interpretation which I hope will not be put forward as the considered decision of the Government, because it would mean purely and simply a repudiation of the spirit of that agreement. The agreement provides for a maximum duty of 75 per cent, ad valorem. The meaning of that is perfectly clear. “ Ad valorem “ means “ according to the value of the goods.” We shall not carry out the spirit of the agreement if we impose fixed duties which do, in fact, exceed the, percentage of 75 per cent, ad valorem, that is, according to the value of the goods. The Customs Department is not obliged to accept any fictitious value placed upon goods by importers. It has authority to review values, and to fix what it considers to be true values. To that extent, it can always give proper protection to Australian industries, at the same time keeping within 75 per cent. as provided for in the Ottawa agreement. The interpretation placed upon the agreement by the Minister is one which I am sure its context will not allow, and I hope that that interpretation will not be accepted by the Government as a whole.
.- I cannot refrain from emphasizing the fact that, although we have just begun the discussion of the group of duties which provides for any substantial tariff amendment, this committee, including every member of the Government, has now defi nitely voted against the Ottawa agreement. I welcome the action of the Government, because it bears out our contention that if proper protection is to be given to Australian industries this agreement will be found to be unworkable. I agree with the honorable member for Perth (Mr. Nairn) as to the interpretation of the agreement. It definitely provides for a maximum ad valorem duty of 75 per cent., and if we impose, say, an ad valorem duty of 50 per cent.,and a fixed . rate equivalent to 50 per cent., on a square yard basis, we shall not he carrying out the letter of the agreement. The action of the Government in respect of the amendment moved by the honorable member for Swan has shown that these duties, lowas they are, conflict with the Ottawa agreement. The Minister, in his difficulty, has placed on the agreement an interpretation which no one else could give to it. The amendment moved by the honorable member for Swan was absolutely in accordance with the Ottawa agreement, yet this committee voted against it. I welcomed the opportunity to cast a vote in order to show the impracticability of the agreement as it at present stands. That vote emphasizes the wrong that was done to this country when the Government applied the guillotine in order to rush the Ottawa agreement through Parliament. That agreement was supposed to have been drawn up with considerable care and skill. No doubt there was skill on the part of those who wished to take advantage of Australian industries! It is significant that in the first item that we should deal with to-day - and one of the first of the really contentious items of this schedule - a vote should be cast against the Ottawa agreement. The honorable member for Gippsland has drawn attention to this fact, and the Minister for Trade and Customs has given an explanation of it which will not bear examination. The statement of the Minister and the vote of this committee strike the first real blow at the Ottawa agreement, and reveal the necessity for a definite amendment of this agreement to restore to this Parliament the right to determine the duties which shall be imposed upon goods entering Australia. It is improper to attempt to fix duties by the general method applied in the Ottawa agreement. In dealing with tariff preferences, specific duties should be fixed on definite items, just as they are fixed in any properly made trade agreement, and they should be determined on a sound and honest basis. To adopta general formula, as was -done in the Ottawa agreement, is to tie the hands of Parliament, and to make impossible the proper determination of tariff duties.
– Whatever may be said on the merits of the amendment moved by the honorable member for Swan (Mr. Gregory), I suggest that it is difficult indeed to argue that the amendment itself was directed towards the carrying out of the Ottawa agreement. It is true that the words “ 75 per cent. “ appear in that agreement; but they must be considered in the connexion in which they appear. The amendment of the honorable member contained the words “ Provided that no duty or combination of duties be imposed against British goods in excess of 75 per cent. ad valorem.”
– On that item.
– It is difficult to find any foundation for the argument that the amendment had any connexion with the Ottawa agreement. The amendment proposed a limitation of duty to 75 per cent. in the case of British goods.
– It did not specify British goods generally.
– I remind the Attorney-General that the amendment has been dealt with, and may not now be discussed.
– I understood that the honorable member moved his amendment with the object of having the principle it contained applied in all cases. I propose to consider whether that principle should be applied to the sub-item now before the committee. The principle was to be expressed by the interpolation of a proviso that no duty or combination of duties should be imposed against British goods in excess of 75 per cent., and it was suggested that the Ottawa agreement provided that the maximum rate of duty on British goods should be 75 per cent. But is that the case? The only reference to 75 per cent. in the Ottawa agreement is contained in paragraph c of part I. of schedule F, which reads -
When goods the produce or manufacture of the United Kingdom are liable to duties of customs exceeding twenty-nine per cent. ad valorem, the difference between the British preferential tariff rate and the rate upon similar goods from the most favoured foreign country shall be at least twenty per cent. ad valorem, provided that in no case shall this margin be applied so as to result in a rate of duty exceeding seventy-five per cent. ad valorem.
That provision relates to , a margin of preference; and, in the circumstances set out, it is provided that the margin shall not be applied so as to result in a rate of duty exceeding 75 per cent. ad valorem. Honorable members must bear in mind that the Ottawa agreement is an agreement between the Government of the United Kingdom and the Government of the Commonwealth, and while it imposes certain obligations and confers certain rights, it does not prevent either party from giving more than the minimum that is specified. When, for example, it is stated that there shall be a 17½ per cent. margin, this Parliament is at liberty to give a 20 per cent. margin. That would be a performance, and more than a performance, of the undertaking. This Parliament is not limited to 15 per cent., 17½ per cent., or 20 per cent. These are minima as to which there is an obligation under the agreement. In the case of this proviso, 75 per cent. is specified as the maximum of the obligation which is binding upon this Government and Parliament. In the application of the margin,we are not bound to go beyond 75 per cent. It is not an obligation of the agreement to provide the margin if it would result in a rate of duty of more than 75 per cent. Suppose, for example, the duty on certain British goods were 60 per cent., that duty, being at a higher rate than 29 per cent., would fall within paragraph c. If the duty were 60 per cent. we should not be bound to go to 80 per cent. If it were 70 per cent., we should not be bound to go to 90 per cent. With deference to those whose opinion is different from mine, I suggest that the whole point is in the well-understood distinction between a substantive provision and a proviso to a substantive provision. If there were a substantive provision in the agreement that no duty in the tariff schedule should exceed 15 per cent, it would be quite plain; but this proviso deals with the application of margins. In the application of margins we are not bound to raise our duties above 75 per cent. I point out to the mover of the amendment that the 75 per cent, refers rather to foreign than to British duties. That the application of the margin is not to result in a duty higher than 75 per cent, plainly refers to the higher of the two duties. In this paragraph, we have a provision for the application of a formula in the case of duties exceeding 29 per cent., but the fact that there is a proviso does not prevent us from giving a greater preference if we wish to do so. When paragraph c is interpreted as a proviso to a substantive provision, it becomes clear that there is nothing to prevent us from providing duties of 30, 40 or 100 per cent., if we wish to do so. The matter is entirely within the control of this Parliament. This is a ‘safeguard inserted by those who drafted the agreement to ensure that in applying margins we shall not be forced to go to a figure above 75 per cent. But this Parliament legislates in respect to matters affecting tariffs generally, and not only in respect of those involved in the carrying out of the Ottawa agreement. I can easily visualize a case in which we have a British duty of, say, 20 per cent. In that case there ought to be a margin of 17£ per cent, under the terms of the agreement, and the duty would be made at least 37£ per cent. I can also visualize this Parliament deciding that in the case of certain countries that have traded with us generously it would leave the duty at 37£ per cent., but that in the case of other countries it would increase it to 50 per cent. These margins are those which we have agreed to give to Great Britain. But there is also a further provision; that we cannot be forced to impose a duty above 75 per cent, against foreign goods; we are at liberty to do so, but are not bound to do so.
– Would the AttorneyGeneral (Mr. Latham) say that if we had a duty of 70 per cent. British, we would not be obliged, in order to give effect to the Ottawa agreement, to make the duty more than 75 per cent, general?
– That is an extraordinary interpretation.
– It is easy to see the reason for that provision.” While we were prepared to give margins of 15 per cent., 17£ per cent., and 20 per cent, to Great Britain, provision was made that we should not be forced to go above a duty of 75 per cent. We are at liberty to go above that figure if we desire to do so; but we cannot be compelled to exceed it. This provision also meets the British point of view. It is easy to understand that Great Britain might be pleased indeed to have some limit upon the effect of the agreement in raising the level of duties generally. Paragraph c of part 1 of schedule F must be understood to be a proviso dealing with the margins on the duties stipulated in that schedule. It allows this Parliament full liberty to give more if it thinks proper; but the Government implements its obligation if it observes the various margins, with the limit, in the third instance, of 75 per cent, as the highest duty. The two important points which I suggest should be borne in mind, are the distinction between being bound to do a particular thing, and being at liberty to do more, and also the essential distinction between a substantive provision and a proviso to be applied in the course of the application of a substantive provision. It is no use talking generally on the subject. The interpretation depends on the specific words used, and upon a recognition of the point that there is a proviso in cases where the margin is being applied. But this Parliament is able to legislate on tariffs apart altogether from applications of margins. It would be able, without infringing in any way the Ottawa agreement, to decide that all foreign duties should be raised by 100 per cent. There is not a word in that agreement which would prevent that from being done, if this Parliament thought it a proper thing to do. I hope that the Parliament would not do it, but I use an extreme instance for the purpose of illustration.
– In the last three lines of paragraph c of schedule F are the words : “Provided that in no case shall this margin be applied so as to result in a rate of duty exceeding 75 per cent, ad valorem.” Should not the word “ need “ appear in place of the word “ shall ?”
– No. I draw a distinction between action taken by this Parliament in applying the margin, and other action which it is at liberty to take. The obligation of applying the margin is subject to this limitation. That is why I made the final point that the Parliament is at liberty, independent of the Ottawa agreement, to increase the foreign duties as much as it likes ; that is entirely an independent consideration. For example, suppose a certain foreign country imposed prohibitions against the entry of all Australian goods. This Parliament would be at liberty, if it thought proper, to prohibit the entry into Australia of all goods from that country. The provisions in the agreement, for example, about the removing of prohibitions, are limited to goods the produce or manufacture of the United Kingdom. In the case of the supposed foreign country which prohibited the importation of our goods, we should be at liberty to put on a duty of 200 per cent, on everything imported from that country. I suggest that no doubt exists upon that point. But in so doing, we should not be acting on the application of a margin. In applying a margin, we fulfil the requirements, even if we do not go above the 75 per cent, mentioned in paragraph c of schedule F. We cannot be forced to go above that rate; yet we are at liberty to give Great Britain further benefits if we think proper. We are. also at liberty to impose obstacles or. impediments to the trade of foreign countries with Australia which are greater than those involved in the application of the provisions of the Ottawa agreement relating to margins.
.- The Attorney-General (Mr. Latham) has taken pains to assure the committee that this Parliament is entitled to give greater preferences than those- stipulated in the Ottawa agreement. Paragraph c of schedule F of the agreement provides for a minimum preference on British goods of 20 per cent., and, of course, Australia is entitled to grant a preference of 100 per cent, if it chooses to do so. It is at liberty to give what preference it thinks proper, provided it is not less than the minimum stipulated in the Ottawa agreement. The interpretation given by the right honorable the Attorney-General is one that I cannot follow. I notice that this is one of the undertakings of the Commonwealth Government as set out in article 8 of the first schedule of the agreement. Certain undertakings are given by the British and Commonwealth Governments respectively, and this is one of the obligations undertaken by the Commonwealth Government. The obligation seems to be very plain. Paragraph c of schedule F reads as follows: -
When goods the produce or manufacture of the. United Kingdom are liable to duties of customs exceeding 29 per cent, ad valorem, the difference between the British preferential tariff rate and the rate upon similar goods from the most favoured foreign country shall be at least 20 per cent, ad valorem.
That simply means that where the duties amount to 30 per cent, or more, the minimum preference to be given to Great Britain shall be 20 per cent. The second part of the clause is equally plain, and states -
Provided that in no case shall this margin < be applied so as to result in a rate of duty exceeding 75 per cent, ad valorem.
– Against the foreigner.
– I do not care whom it is against. The Attorney-‘General believes that this provides for a maximum rate against the foreigner of 75 per cent., and I accept that.
– The paragraph states that the margin shall not be applied so as to result in a rate of duty exceeding 75 per cent.’
– It means that in the result the rate of duty shall not exceed 75 per cent. That must be read in conjunction with the earlier part of the paragraph, which states that the minimum preference which shall be given to Great Britain is 20 per cent. It is hard to reconcile the interpretation given by the Attorney-General that this part of the agreement would be carried out if the duty against British goods amounted to. 70 per cent, and that against foreign goods to 75 per cent. In the net result the preference to .Great Britain would then be only 5 per cent.
– That was accepted by the British delegation.
– But we have to be guided by what is contained in the agreement itself.
– That is in the agreement.
– I again draw attention to the words that I have already quoted -
When goods the produce or manufacture of the United Kingdom are liable to duties of customs exceeding 29 per cent, ad valorem, the difference between the British preferential tariff rate and the rate upon similar goods from the most favoured foreign country shall be at least twenty per cent, ad valorem.
It is absurd to say that that condition would be satisfied by a difference in duty of only 5 per cent. The agreement provides for a minimum preference of 20 per cent., and to give a preference of only. 5 per cent, would not be to carry out either the principle or the express terms of the agreement.
. - I shall try to throw some light on this point, which has become somewhat controversial. An attempt was made at Ottawa on behalf of Australia to show as much consideration as possible to those foreign countries which are good customers of ours. That’ is indicated in a number of cases in the agreement. For instance, with reference to the remarks just made by the honorable member for Perth (Mr. Nairn), I may say that the formula df preference does not apply at all to British goods which are already mainly in possession of the Australian import market. If Great Britain is shown, for instance, to have already 70 per cent., 80 per cent., or 90 per cent, of the Australian trade, the formula will have no application. If Great Britain cannot show capacity to manufacture certain goods, the formula, again, has no application. Coming to the point now before the committee, we stated at Ottawa that’ we did not wish to carry any ad valorem duty above 75 per cent, against the foreigner, and, as -the Attorney-General (Mr. Latham) has pointed out, we said that, if that were threatened, we should not be required to apply the formula. That was accepted by the British delegation, and is clearly expressed in the agreement itself. To me the agreement is a perfectly simple one; the limitation of 75 per cent, has no bearing at all on the level of the British duty which this Parliament may impose; it really has no application to the level of the foreign duty that may be imposed by this Parliament. Out of consideration to foreigners, where the duty is very high, the agreement merely reserves the right to the Government to say that here the formula shall not have application. I am somewhat surprised that our friends of the Country party, and other honorable members, by their vote this afternoon, have indicated their desire to have the formula enforced in a way which would have the effect of making the foreign duties even higher than they now are.
.- The duties provided for under , subitem aa - piece goods, knitted - represent a reduction of the duties introduced by the Scullin Government, which were 2s. 6d., 3s., and 4s. per lb., with the addition of ad valorem rates of 30 per cent., 40 per cent., and 50 per cent., which duties have operated since the 21st November, 1929. Under the 1921-28 tariff, the actual rates of duty were similar in all respects to those now in force, except that they operated upon an alternative and not composite basis, as at the present time. The actual increase, therefore, in tariff protection afforded the industry by the Scullin Government, consisted of the supplementary duty of 30 per cent, ad valorem in respect of imports of British origin, and 50 per cent, ad valorem upon import’s not entitled to preference. This is a very important industry. In the State of Victoria alone, there are thirteen knitting mills, the output of which for the twelve months ended the 30th June, 1931, was 2,800,000 lb., valued at £610,000. Those figures were increased in the eleven months ended the 31st May, 1932, to 3,500,000 lb. and £675,000 respectively. In Victoria employment is given to approximately 2,000 persons, and the total amount drawn in wages during the twelve months ended the 31st May, 1932, was £237,000.
This is one of the subsidiary industries that assist the Australian wool and cotton spinning mills, as well as the woolgrowers and cotton-growers. During tho eleven months ended the 31st May,’ 1932, it used cotton yarns valued at £161,000, and woollen yarns valued at £113,000. The amount of capital invested in the industry in Victoria is £1,059,000. As has been the case with other secondary industries, tariff protection has had the effect of reducing the prices of the articles manufactured by this industry. Since November, 1929, that reduction has amounted to 35 per cent. The present rates of duty are absolutely necessary to the industry as a whole, to enable it to secure stability of employment as well as continuity of factory operations - a very important consideration. Any person who has made a study of the industry knows that in it a very high state of efficiency prevails, and that the public obtains its varied requirements at very reasonable prices. A factor that has to be borne in mind is that a big section of the industry is carried on in country centres, such as Bendigo, Ballarat and Maryborough in Victoria, where no other kind of employment is available for our young people. The Tariff Board states, in its report, that the industry can be rated as efficient, and that, as far as can be judged, it is providing the public with knitted piece goods and garments at reasonable prices. As that report was made only last year, I trust that the Minister will not be in a hurry to have the industry further investigated with a view to conforming to the terms of the Ottawa agreement, under which the British manufacturer must bc given equal opportunities of competing in the Australian market. The industry provides employment for a large number of our growing boys and girls. Whatever the personal views of the Minister may be in regard to the necessity for continuing this protection, it is known that since the Ottawa agreement was made the fiscal outlook of the Government has undergone a change, and that in many cases it feels that it cannot continue protection which twelve months ago the Minister would consider was deserved. Frequently the honorable gentleman himself is overruled, because it is represented by the British Government .that the spirit and the letter of the Ottawa agreement are not being observed. This industry may suffer as the result of further representations to the Commonwealth Government by British manufacturers.
The total value of Australian woollen yarns used in the production of these knitted goods during 1931-32 was £113,000, while the value of cotton yarns used in the same period was £161,000. The purchase of raw wool on the Australian market in competition with overseas buyers results in a higher price being obtained by the producers of that commodity. It is important, therefore, that no action should be taken that might jeopardize this large labour-employing industry.
– No complaint having been received from any manufacturer regarding this duty, it may be assumed that it is regarded as satisfactory. The industry made great progress under the 1921-28 tariff. I agree with the remarks of the Deputy Leader of the Opposition (Mr. Forde), concerning its efficiency. The only change made is that there are now alternative rates in substitution for the cumulative fixed and ad valorem rates imposed by the last Government. ‘ This is one of the 214 industries to which I have previously referred that have been investigated by the Tariff Board, and been given it3 approval. There is an increase of 5 per cent, in the general tariff rate so as to conform with the Ottawa formula.
.- In this matter the Government has given effect to its definite policy in the direction of the reduction of the tariff. The Minister airily waves aside the reduction by saying that, after all, the difference is only slight, and that the industry is doing quite well. The honorable gentleman ought to know that the industry is not doing quite well; that already unemployment has been created, and that further unemployment must be caused.
– In Sydney. I hope to be able to supply the de.tails later. This is one of those industries that may be carried on in most of the States, and in the different States advantage has been taken of successive tariffs to build up gradually a tremendous output of knitted goods. But proposals such as this have a definitely adverse effect. The manufacturers have been reduced to such a state that they can now do nothing but pray fervently that the Government will not be so harsh as to put them completely out of business. This is not only a direct blow at the knitted goods section of the textile industry, but it also gives effect to the declared policy of the Government to implement the Ottawa agreement. It looks as though that implementation is to be made at the expense of knitted goods. I protest against these continual attacks on Australian industries which, prior to the advent of this Government, were established on a sound basis and were providing congenial employment at fair wages and under good conditions for Australian workers. Under such a policy one can readily visualize the dismissal of many thousands of those who to-day are employed in this industry in Australia. Work will be provided in other countries in the production. of goods that should be made by our own people.
– I challenge the statement of the honorable member that unemployment has been created in this industry. He promised to supply the details at a later stage; but his case would be strengthened if he produced them now. The Tariff Board publicly advertised the fact that it proposed to hold an inquiry into this industry, yet no manufacturer appeared before it to object to the present duties. The British fixed rate has been reduced by 6d. per lb., while the foreign rate has been increased. It is foreign competition that has to be guarded against. The constant throwing of stones at Ottawa may be popular in some quarters; but frequently the assertions made are gross exaggerations.
– Bonds dismissed 150 employees just prior to Easter.
– Bonds is a spinning and weaving mill; its operations are not confined to knitting.
– They were dismissed from the knitting section.-
– There are many reasons for the transfer of employees from one industry to another, or from one section of an industry to another. The official figures show that unemploy ment is less to-day than it was in March, 1931. Silk and artificial silk compete with this knitted line. There has been a change in the industry, and some dislocation has been caused at different times, principally during 1929 and 1930; but the industry is now holding its own, and is thoroughly efficient. The Tariff Board investigated its operations in accordance with the terms of the Ottawa agreement, and so far the Government has not received any complaints from the manufacturers themselves.
.- The Tariff Board has recommended the- reduction of the duty imposed by the Scullin Government on sub-item f, paragraphs 1, 2, 4 - piece goods, woollen or containing wool - for which relief, much thanks. But, having regard to many of the expressions that are to be found in its report, I am inclined to believe that it would be disposed to recommend a further reduction if the matter were again considered by it. In its report of ‘September, 1932, the board admits that the amount of duty recommended is in excess of the protection necessary to secure to the Australian manufacturers an overwhelming proportion of the trade. In its report issued in September last, the Tariff Board stated -
The rates of duty recommended by the board are higher than are considered necessary to secure the Australian manufacture of an overwhelming proportion of the market in woollen piece goods for men’s wear. The ad valorem equivalents of the rates vary considerably, but they represent an average duty of 44 per cent, on men’s suitings, &c, as set out in Table A given earlier in this report, and an average of 84 per cent, on woollens of the lighter weights as shown in Table B. Apart from the duties recommended by the board, there exists at present abnormally high landing charges due to primage and exchange. The average cost of landing the lines above referred to under existing charges, including duty, is 120 per cent, on the f.o.b. value. However, the board, in making its recommendation, has indicated the rates of duty which it considers adequate without the added protection at present afforded by exchange and primage duty.
Since that report was published the Tariff Board has undertaken an inquiry into the effect of primage and exchange and the extent to which these charges should be .taken into account when fixing duties. It is unfortunate, that the result of its investigations is not yet available; I understand from the Minister that the report will be available shortly. The report from which I have quoted, however, makes it clear that the board did not take into consideration primage and exchange when fixing the duties on this item, so that although the present recommendations of the board involve a reduction of the previous duties, they still provide for a higher protection than is necessary to secure to the Australian manufacturers an overwhelming proportion of the Australian market. It is doubtful whether the board is adopting a correct principle in recommending duties of this character, for one effect of the duties is that the Australian consumers pay more for the goods they require than would be the case if the duties were more moderate.
– The Australian consumers are getting their goods at fair prices, having regard to the prices charged in other countries, such as Great Britain.
– From a table on page 10 of the Tariff Board’s report, showing the variation in prices- between local and overseas products, I extract the following: -
It will be seen from that the Australian consumers are paying about 90 per cent, more than British users of similar material are called upon to pay. Surely no honorable member will suggest that in women’s woollen dress materials and men’s tweed suitings, the Australianmade article is equal to the British.
– The Australian goods are of equal quality.
– And much cheaper.
– The Australian article may be cheaper, but a person who wants a good suit will pay more to obtain British material.
– And he gets Australian cloth without knowing it.
– Australian manufacturers themselves admit that . they have not the same range of goods, although they claim that the quality of their tweeds is better than that of their competitors, having regard to the prices charged. I submit, however, that persons who want good-quality material do not buy Australianmade cloth.
– Of course they do.
– People who want the best material will pay more for the imported article.
– Merely to satisfy their whims.
– Honorable members surely will agree that in these lines the < British goods are at least equal to the best Australian. It is well known that the Australian manufacturers’ range of women’s dress material is limited. The Tariff Board also reported -
The imposition of unreasonably high rates of duty imposes serious disadvantages on the community, this being particularly so in the case of materials, like women’s dress goods, where the range is so wide. The range of fashion goods in demand is too wide to be met by any one country. Although the Australian manufacturers have produced an excellent variety of woollen dress goods, evidence makes it clear that there remain numerous lines, many of which are only in small demand, but in the aggregate, represent a considerable proportion of the requirements which the local manufacturers by reason of limited output could not commercially produce.
That paragraph is an effective reply to those protectionists who claim that high duties should be imposed on these goods in order that the Australian market may be reserved to the Australian manufacturers. Such a policy is unreasonable, because it means either that desirable goods are excluded, or, if allowed in, are subject to almost prohibitive charges. If we adopt a policy of excluding goods made in other countries, our Australian manufactures will never imbibe new ideas. I hope that we shall soon get beyond that stage in which Australian manufacturers have continually to be coddled. I hope that some day they will be able to export something, and so render some real service to this country in the way of bringing in money from outside. Notwithstanding that we have assisted them with high tariffs and bounties, Australian manufacturers are almost incompetent to -export anything. If we continue to give them a closed market, by removing all competition from them and preventing them from gathering new idea’s, they will remain in their present state. We should realize that it is necessary for our manufacturing industries .to develop in the face of competition. Is it right that Australian consumers should pay so much more than their fellow consumers of Great Britain pay for similar goods? It may be a fine thing to have factories established in this country, and no doubt it is regrettable that 150 employees have been dismissed by Bond’s Limited. Nevertheless, the fact remains that they were maintained by bounties paid by the Australian community as a whole. That policy may suit Bond’s and find favour in Sydney where the money is distributed; but such advantages are given to the few at the expense of the consuming public of Australia who have to pay for the privilege of keeping these establishments going. I am npt opposed to reasonable protection, but surely a protection which increases the costs of goods by 90 per cent, is not reasonable.
– The disparity in labour costs must be taken into account.
– I do not care what the reason for the higher cost of goods may be. If labour costs in this country are so high that Australian manufacturers cannot produce goods at reasonable prices, those costs should be reduced.
Honorable members interjecting,
– Whenever, mention is made of reducing labour costs, some honorable members fear’ that their constituents will think that they have advocated a reduction of wages. The higher costs in Australia are not due solely to the higher wages paid in Australia compared with other countries; there are also overhead expenses, including rent and interest, to be taken into account. Many Australian factories were established when prices were at their # peak, yet the protectionists in this House seek to maintain the conditions which then prevailed, notwithstanding that money is now much scarcer. We cannot fairly maintain those conditions; costs must come down. As I have said, the Tariff Board admitted that the rates of duty which it recommended were in excess of the protection necessary to secure to Australian manufacturers an overwhelming proportion of the Australian market. I do not think that the present duties are economically sound. I understand that the Tariff Board is to reconsider these items, and I hope that when it does so, it will reduce the protection to a level which, while giving reasonable protection to Australian industries, will not impose an undue burden on the consuming public.
.- I hope that the wish expressed by the honorable member for Perth (Mr. Nairn) will not be realized, and that the Tariff Board will cease to meddle with the protection afforded to a fine Australian industry. If there is one industry which is natural to Australia, it is the wool industry. If there is one anomaly more than another in this country, it is that we produce in Australia the finest wool in the world, and then send it 12,000 miles to be manufactured into clothing for our own use. My regret is that the present Government has interfered with the duties on this item which the previous Government imposed. The proposal before us now is that the duty on British goods shall be ls. per square yard, and 30 per cent, ad valorem, compared with 2s. per square yard and 35 per cent, respectively under the Scullin Government’s tariff, while the duty on foreign goods is 2s. per square yard and 50 per cent, instead of 3s. and 50 per cent, respectively under the tariff schedule which it supersedes. The duties on men’s suitings proposed in this schedule are practically the same as those which were in operation before the Scullin Government introduced its tariff schedule. At that time, there were heavy importations of woollen goods into Australia. In 192?-28, the importations of woollen piece goods, including flannels, worsteds, wool and cotton, and other woollen goods, were valued at £2,483,000. In 1931, the imports fell to £173,000. That would be due to some extent to the reduced- purchasing power of the community, but it was largely the result of the increased protection given to local industries. In that regard, the Tariff Board stated; -
The increased duties, by virtually preventing the importation of all woollen piece goods except very special lines, gave the local manufacturers practically the whole of the Australian market. The increase in local production was, however, not in keeping with .the fall in importations, partly owing to the contraction of purchasing power of the community, and the resultant accumulation of stocks of goods previously imported and also locally made, and partly to the inability of local manufacturers to supply immediately the variety of light weight materials in demand. Gradually, however, as the market has been cleared of accumulated stocks, and as the local mills have developed in the production of light weight goods, output and employment has increased.
Clothing manufacturers have complained that they could not get immediate delivery of a wide range of goods, particularly light weight materials. That was partly due to the fact that they were not prepared to place their orders for Australian materials as far ahead as they wore compelled to place their orders for imported goods, but when the duties were increased, they found it practicable to place their local orders in advance, with the result that local mills were able to supply them. Any honorable member who has visited the Australian mills, particularly in New South “Wales and “Victoria, must have been impressed by the increased activity displayed by them subsequent to the imposition of really protective duties. Instead of some mills being idle and others working only a few days weekly, all were working full time, and some were working two shift’s daily, and employing a large number of hands. The woollen textile industry is one of those that respond to the impetus of protection, and did not take advantage of the higher duties to raise the price to the users. As a matter of fact, the evidence shows that, since the increased duties were imposed, the average price of woollen goods has been reduced 30 per cent. A statement was submitted to the Tariff Board from 28 mills that since the increase of duties, 8,000 new types or designs of cloth, and 200,000 patterns had been produced. That is a complete answer t’o the statement of- the honorable member for Perth that manufacturers cannot get from local mills a wide range of goods. The honorable member said that the range of ladies’ materials was not wide. I quote from an article published in the Argus of the 23rd March, 1932, under the name of “ Vesta “, the social writer of that journal -
During the last few years, the progress made in the manufacture of woollen materials must have seemed amazing. . . . During the last few weeks, I have had an opportunity of seeing samples of very many of the women’s dress stuffs made here. To say that I have been surprised and delighted is to express mildly the admiration’ and pleasure I have felt. The manufacturers seem to have reached in one stride the level attained by oldestablished mills abroad.
It is easy to condemn generally Australian products, and to say that a person would sooner pay a higher price for a good imported article. People who speak in that strain retain the prejudices of twenty years ago. No one will deny that in the early stages of the Australian industry its products were not comparable with imported suitings, but to-day if a person is prepared to pay a reasonable price he can purchase a local article as good as any imported, and certainly good enough for any person to wear. One of the difficulties with which Australian manufacturers have had to contend is this prejudice against Australian products. Those who are ready to buy an Australian cloth want it at half theprice charged for the imported article, and, in order to meet that demand, manufacturers have been obliged to reduce the quality of their goods. A person who is prepared to pay a reasonable price can get an Australian article as good as any produced in other countries. The honorable member for Perth emphasized the prices charged for Australian cloths. According to the Tariff Board’s report, the highest price for heavy-weight twills and tweeds, black and navy-blue, is 10s. 6d. a yard. From Si to 3£ yards is required to make a suit for an average man; therefore, 34s. will purchase a length of one of the best suitings a person can desire. Comparable imported material without duty costs 8s. a yard, so that the difference in the price of a suit is only 8s. in favour of the imported cloth. Is that too big a price to pay for woollen mills which employ over 12,000 of our people throughout Australia, mean prosperity to many country towns, and provide another competitor at the wool sales for Australian raw material. The percentage of the total clip that they buy is not large, but their demand has some influence on the price of wool. I am amazed that the Government has interfered with the duties imposed by my Government. I admit that while exchange and primage continue to give indirect protection the danger to local woollen mills is not great; but they will suffer to some extent by the reduction of duties, and mill-owners are apprehensive because they know that the aid given by exchange and primage may be only transient. A return furnished to the Tariff Board shows that, in 1930, 27 mills were employing 6,200 persons, and were working only part time. In 1932, those mills employed8,900 persons on full time. That is a remarkable improvement in two years. In the same period the output rose from 3,770,000 yards, valued at £990,000, to 5,870,000 yards, valued at £1,190,000, whilst the average price had fallen by about1s. a yard. According to a very interesting report prepared by the Victorian Government Statistician, Mr. Lawton, the textile mills in that State, including others than woollen, employed in 1931, 14,700 persons. In the following year the number employed was 17,100, an increase of over 2,000 in one State only. The wages paid annually in woollen mills alone is £2,000,000, and the raw material used is valued at about £4,000,000. I repeat that whilst the local mills have increased their output and employed more people, they have reduced the charge to the user. The honorable member for Perth quoted a portion of the Tariff Board’s report referring to the range of materials. I draw attention to the following passage which I am surprised to find in the report of a responsible body claiming to have an Australian outlook : -
The board is convinced that local manufacturers can provide for a large proportion of the requirements of woollen piece goods, both for men’s and women’s wear, and it is prepared to recommend duties that should secure this result. On the other hand, it is considered unwise for the local industry to attempt to meet all the demands of the trade. . . .
The industry is condemned when it does not meet the demands of the trade. Yet when it sets out to do so, and succeeds, it is told by the Tariff Board that it is unwise.
– The board evidently refers to the very low-weight materials.
– The range of lowweight materials produced in Australian mills has amazed everybody. Is it any wonder that the lady expert whom I have quoted expressed amazement at the growth of the industry ? A few years ago, we were under the impression that the production of a wide range of materials, in particular, light-weight materials, was not possible under the method of developing the Australian textile industry, yet within one year the industry by its wonderful expansion entirely removed that impression. It is strange that the Tariff Board should now tell us that it would be unwise for the industryto attempt to manufacture certain weights of materials when it is at present manufacturing them successfully. According to the evidence given before the Tariff Board the industry isusing some 200,000 patterns, and if that number is not sufficient to coverour requirements, we must be mighty fastidious.
– We are likely to force people to buy imported cottons instead of woollens.
– There is not much in that argument, because it could be used in respect of every industry that we are likely to establish. If we make the prices of our manufactures prohibitive, we shall, of course; force the consumers to buy something else. But present prices are not prohibitive, and there is no complaint about the local article. The Minister well knows that cotton manufactures are not likely to displace woollen manufactures. In a little over twelve months the Australian industry has provided 8,000 new classes of materials. Surely that is a marvellous development. I regret that the Government has seen fit to reduce these duties. There has been no proof of exploitation on the part of manufacturers, but there has been plenty of proof of the efficiency of the industry, the increasing employment of our own people, and the increasing use of our own raw materials. I hope that the Government will not accept the suggestion of the honorable member for Perth (Mr. Nairn) that the Tariff Board should review this industry and make further reductions of duties. Such an action would be calamitous to the industry, because it would mean closing up many of our mills and throwing out of employment many thousands of our workers.
). - I move -
That that portion of the tariff resolution introduced into the House of Representatives on 8th March, 1933, relating to paragraph 4 of sub-item f of Item 105, be incorporated in the present proposals as on and from the 9th March, 1933, in lieu of paragraph 4 of sub-item f of Item 105 of the tariff resolution introduced into the House of Representatives on the 13th October, 1932.
Paragraph 4 Avas amended by the resolution of March, 1933, and this amendment is necessary in order that that portion of that resolution relating to this paragraph may now be debated. The resolution reduced the duty on slipper upper felt by. 3d. per square yard. The amendment makes no alteration to the rate or the wording of the paragraph as set out in the group of tariff items under discussion
Amendment agreed to.
.- I rise to support the remarks of the honorable member for Perth (Mr. Nairn) in connexion with this sub-item, because the duties imposed are excessive. The Leader of the Opposition (Mr. Scullin) has rightly declared that the woollen industry is one of the great natural industries of this country, and that we have a monopoly of the finest wool in the world. In view of that fact, our people should be clothed with woollen manufactures as cheaply as the people of other countries; but strange to say, that is not the position to-day. . Last week, while in Sydney, I decided to visit the Blue Mountains, and, therefore, to purchase some warm underclothing. The price quoted to me for a Crimean shirt was 22s. 6d., yet the garment did not contain more than ls. 6d. worth of ,wool. In the interests of the woollen industry and of those employed in it, the Government should make every endeavour to reduce the price of woollen goods so as to bring them within the purchasing capacity of the people generally. Woollen garments are very necessary during the cold winter months, and suitable garments should not be denied to our people””. The Leader of the Opposition has stated that at one period, the industry employed 8,000 workers, but that the number had now been reduced to 6,000.
– The honorable member misunderstood me. I pointed out that despite the depression, and since the increase of the duty, the number of those employed in 28 mills had increased from 6,200 to 8,900.
– The high prices ruling for commodities in Australia today constitute one of the greatest handicaps to our wool industry. The price of wool is low, labour costs have been reduced, and the exchange is favorable to the producer. Yet because of the high tariff, the people of Australia are denied the use of reasonably priced woollen products. The high tariff makes for less work, less wool, and lower consumption. This Parliament should make some effort to reduce prices, in view of .the reduced purchasing power of the people of Australia. The cost of tweeds made in Australia is 3s. 6d. a yard at the mill. The cloth is sold by the warehouses at 6s. 6d. a yard, and by the tailors at from 10s. 6d. to 12s. 6d. a yard. There has been little alteration in the price of suits within the last few years. Present-day prices preclude the extensive use of Australian tweeds, and that, of course, has a detrimental effect upon the wool industry. The Government should do everything within its power to reduce the price of woollen manufactures.
– I hope that the Government will not reduce these duties; I should prefer it to increase them. The honorable member for Forrest (Mr. Prowse) has suggested that we should concentrate upon the development of our natural industries, and, in particular, the woollen industry. I would point out to him that the textile industries are part and parcel of our great woollen industry, and, therefore, to be consistent, he must be prepared to protect the woollen textile industry with which we are now dealing. The war gave this industry a great stimulus. The Government and the military authorities, instead of purchasing imported woollen materials, decided to manufacture their own requirements. The result was that our soldiers were better clothed than any others in the field. The Government, by taking that action, saved millions of pounds. The duties imposed are not too high, although I admit that there is too great a margin between the price charged by. the manufacturer and that charged by the tailor or shopkeeper. But that evil will arise whether the material is imported or locally manufactured. The woollen mills of this country are not exploiting the people. All my life I have been fastidious about my clothes. For many years I wore suits of imported material,but during the last four or five years, I have worn suits of Australian material. I myself cannot distinguish between the imported and the local material, and I am quite certain that many thousands of people in Australia to-day are under the impression that they are wearing suits of imported material when actually their suits are of Australian material. There is, unfortunately, among the community, a prejudice against Australian commodities, and our manufacturers and workmen generally do not get credit for the excellence of the materials that they produce. The manufactures of the Geelong “Woollen Mills are equal to the imported materials. The Geelong “Woollen Mills supply materials to some of the largest tailoring establishments in Melbourne, and I have been informed by the manager and the secretary that those establishments buy the materials only on condition that the public remain ignorant of the fact that they are manufactured in Australia. Suits made of materials manufactured by the Geelong Woollen Mills are sold in city shops at from £12 12s. to £14 14s., just because the purchasers believe that they are made of English materials. I would not dare to make such a statement if I were not certain of its truth.
– Why cannot we sell our goods abroad?
– Surely the honor. able member knows why we cannot do so. Are not the British textile manufacturers to-day demanding protection against Japanese goods, the Czechoslovakians against Indian goods, and the Americans against the cheap products of other countries ? The honorable member must know that it is foolish to expect our manufacturers to export their products to coun- tries which are regarded as dumping grounds by the manufacturers of cheaplabour countries overseas. Everybody knows that half the world’s machinery is running at only half capacity. In all the circumstances, I hope that these duties will not be reduced, and that the Minister will reconsider the position. The woollen textile industry provides employment for a large number of people, both men and women, under decent conditions, and it has been so successful in securing the local market that thousands of our people are wearing Australian materials who think they are wearing imported materials.
– I appreciate the opportunity of speaking on this, the principal item covering woollen textiles, for the reason that Geelong, the main centre in my electorate, is the biggest individual centre of the textile industry in Australia, six of the principal mills of the Commonwealth being situated in it. It is necessary in the interests of all concerned that a fair statement should be made on this item, particularly in view of the efforts of the Deputy Leader of the Opposition (Mr. Forde) to mislead the people by the public statements he has made regarding the effect of the reduction of duties.
– I rise to order. The remark of the honorable member for Corio (Mr. Casey) is particularly offensive to me. I have never tried to mislead the people. I have told the truth as I saw it in the light of fact’s furnished to me. I therefore ask that the honorable member withdraw his remark.
– I remind the honorable member for Corio that the Deputy Leader of the Opposition has not yet spoken on this item. It would not be in order for the honorable member to refer, at this stage, to speeches made by the Deputy Leader of the Opposition /outside this chamber.
– I withdraw the remark if it has hurt the feelings of the Deputy Leader of the Opposition, but I shall refer in detail to the statements of the honorable gentleman to which I take exception.
– The honorable member will not be in order in referring to remarks made by the Deputy Leader of the Opposition at a public meeting, unless such reference has particular relation to the item now under discussion.
– Then I shall confine myself to the honorable gentleman’s remarks in this chamber. When I do so, I feel sure that he will welcome the correction which I shall be able to make, for I am certain that, as a public man who has held responsible office in this country, he is just as earnest a seeker after the truth as I am myself. The matters to which I shall refer are explainable by figures which have been supplied to me by the Customs Department and the Statistician’s Department.
My principal contention is that the reduction of duty from 2s. and 35 per cent, to ls. and 30 per cent. British, which was made last September, has not adversely affected this industry, as suggested by the Deputy Leader of the Opposition. As a matter of fact, the mills have never been so busy as they are to-day.
– That is due to the Scullin tariff.
– That tariff is only one of many factors, as I shall show later. I agree with the statement of the Leader of the Opposition (Mr. Scullin) that this is probably the most natural industry in Australia, for the following reasons: - It is a large user of Australian raw material; it has a market in Australia that is sufficiently large to warrant the installation of economic plant; it is an efficiently conducted industry and a big employer of labour; and it is subject to such internal competition that prices and profits are kept on a reasonable basis.
– And still it cannot export its products!
– An export trade is already beginning, in a small way. This is one of the few secondary industries to which we can look with some hope for a future export trade. It can be said with truth of the Australian woollen textile industry that it has not made any attempt to exploit the people because of its advantageous position by reason of the tariff, exchange and primage, and other factors such as the reduced purchasing power of the people, which have tended to exclude imported materials. Importations of woollen textiles have practically stopped, and the Australian industry now has almost complete control of the local market. In spite of this fact, prices have actually declined by from 25 to 30 per cent. This industry affords a most striking example of reasonable charges being made by an Australian industry which has practically complete protection against importations from overseas.
In brief terms, the situation of the textile industry of Australia is this: In and before 1929 the Australian mills supplied the bulk .of the Australian market with men’s suitings, flannels, blankets, and cheaper overcoatings, but with practically none of the light-weight women’s materials or more expensive men’s suitings. Now, our mills supply, not only the textiles which they formerly supplied, but also a very large percentage of lightweight and. other classes of materials for women’s apparel. I have taken some trouble to analyse the figures relating to our importations of woollen piece goods. I found that in the pre-depression years, which were, roughly, the last four years of the regime of the Bruce-Page Government, no less than 75 per cent, of our total importations of woollen piece goods consisted of light-weight materials for women’s apparel, whereas now Ave have secured practically the whole local market for our own products in these materials. In 1928-29, which was the last pre-depression year, the Australian mills provided 68.28 per cent, of the total consumption of woollen textiles, or more than two-thirds of them. In 1930-31, which I hope Ave can call the mid-depression year, the percentage of the products of the Australian mills to the total consumption had risen to 90 per cent. For the year ended June, 1932, the percentage of the Australian market supplied by the Australian mills Avas 97.5 per cent. - a most extraordinary figure. In other words, by the end of last June the Australian mills were able to supply practically the whole of Australia’s requirements. The total value of our production in 1931-32 Avas £4,852,216, whereas . in the predepression year of 1928-29 it Avas £4,779,814, but, taking into account the drop in price, I am satisfied, though I cannot support my statement with actual figures, that the yardage production of Australian material Avas 25 per cent, greater in 1931-32 than in 1928-29. I have also attempted to analyse the import figures for the eight months of the current financial year to the end of February, 1933. I find that, while the imports in that period were rather greater than in the corresponding period of 1931-32, the difference was only slight. It can be said quite definitely that the imports are negligible compared with the production of the Australian mills. In 1932-33 our Australian mills will probably supply 95 per cent, of our total requirements in textiles. In these circumstances, I contend that the reduction of duty from 2s. and 35 per cent, to ls. and 30 per cent. British, which was made last September, has not injured our woollen textile industry.
– What caused the drop in price?
– Internal competition and a drop in the purchasing power of the people.
– Did not the drop in duty have anything to do with it ?
– No; I do not think it has had any such effect in this instance.
Our importations are a mere dribble, for they account for only about £100,000 worth of material against a local production of nearly £5,000,000 worth. I contend, therefore, that these two sets of figures bear no relationship whatever.
I ask you, Mr. Chairman, whether I shall be in order in referring to statements made outside of this chamber?
– Not unless the reference was strictly to this item.
– The remark has been made by the Deputy Leader of the Opposition (Mr. Forde), and repeated this afternoon by the Leader of the Opposition (Mr. Scullin), that the reduction of duties provided in. this item will take the rates back to those which prevailed under the 1921-28 schedule. When the Deputy Leader of the Opposition was in Geelong at the end of last year he was reported to have made a statement to this effect. I refer to the report which appeared in the Geelong Advertiser of the 19th December last.
– Unfortunately, the reporter omitted to make any reference to the reduction in the weight of the cloth.
– I also referred to that fact this afternoon.
– I regret that I did not hear that qualification. It is a material point. The duty now being provided is in no way comparable with the duty imposed under, the 1921-28 schedule.
– That is due to the action of the Scullin Government.
– The action of the Scullin Government is only one factor in the situation. The statement that the duty now applies to textiles weighing more than 3 oz. per square yard whereas the figure was formerly 6 oz., and that this is wholly responsible for the encouragement of the manufacture of lightweight materials for women’s clothing must be considered in the light of the fact that importations of these goods had dropped from a value of £2,115,000 in 1927-28 to £685,000 in 1928-29, by reason of the depression beginning to make itself felt, and remained at practically the same figure- £683,000 in 1929-30- after the alteration from 6 oz. to 3 oz. had been made, and has since dropped to a very small figure owing to the exchange, and primage factors and the lack of purchasing power of the people.
– The Australian manufacturers could not get the market until after the alteration in regard to weight came into effect.
– As I have just shown, imports of light women’s materials had substantially declined before that action was taken, although, of course, it is clear that the alteration in weight was a11 active factor.
For the benefit of honorable members who are not familiar with this item, I point out that woollen textiles are principally dealt with under two items in the tariff, namely, 105f, 1 and 2, and the weight per yard is the criterion as between the two sub-items. Item 105f 1 is the principal item, and has always carried the higher duty. Until 1929 material weighing 6 oz. per square yard came under item 105f 1, and paid the higher duty. In 1929; material weighing as low as 3 oz. was brought into the higher duty item. As practically no material under 3 oz. per square yard is made in Australia, or, indeed, imported into Australia, the effect was to make item 105f 1 the real protective item and to make item 105f 2 practically inoperative.
There were practically no men’s suitings coming in under the Bruce-Page tariff. In these circumstances, I contend that it is quite wrong to say that the duty is now virtually where it was under the 1921-28 tariff. No one wanted a higher duty over those rates for the heavier material, for we had obtained practically the whole market.
I endorse the remarks of the Leader of the Opposition (Mr. Scullin) in regard to the impetus that has been given to the manufacture of light-weight material for women’s use. I have ventured, with the the authority of Mr. Speaker and the Library Committee, to place upon the table of the Library a fairly complete range of samples of women’s materials of light and other weights.
Sitting suspended from6. 15 to 8 p.m.
– The Australian textile industry deserves the highest praise for the rapidity with which it has responded to the demand for light-weight women’s materials owing to the necessity for restricting imports for the purpose of correcting our adverse trade balance. In diversity of range, designs, and quality, I think that the articles produced in Australia bear favorable comparison with any similar imported goods. I hope that honorable members will take this opportunity to inspect the samples of women’s materials made in Australia that I have been allowed to display in the Library. They should note the diversity and the range of colours and designs, and; above all, the quality.
It is important to compare the degree of effective protection given under the Lyons and the Scullin tariffs to textiles of various prices. I have worked out the landed cost of imported materialsat London invoice prices ranging from 3s. to 12s. 6d. a yard, and have had my figures checked by an importing house, an Australian manufacturer, and the Department of Trade and Customs. They apply to cheap, medium, and expensive lines. Material invoiced in England at 3s. a yard is landed in Australia at the present time at about 5s. 9d. a yard, without taking exchange and primage into account. With exchange and primage added, the cost of this 3s. material becomes 6s.10d. under the Lyons tariff, or an increase of about 125 per cent. Under the Scullin tariff it became 8s.1d. a yard, or an increase of about 167 per cent. That includes packing, freight, insurance, exchange, and primage duty, but not sales tax. It is the price into the warehouse of the Australian merchant. Taking a medium price material invoiced in England at 7s. a yard, the price increases under the present Lyons tariff to 11s. 7½d., or an increase of 65 per cent. without taking exchange or primage into account. Allowing for exchange and primage, it becomes 14s. 2d. a yard, or an increase of just over 100 per cent. Under the Scullin tariff, it became 15s. 8d. a yard, or an increase of about 125 per cent. Expensive material invoiced at 12s. 6d. a yard in England, becomes 19s. 9d. under the present Lyons tariff, or an increase of about 60 per cent. without exchange and primage. With exchange and primage, theprice increases to 24s. 4d., or an increase of about 90 per cent. Under the Scullin tariff, it would be 26s., or an increase of about 110 per cent. Taking an approximate average over the whole range of prices from 3s. to12s. 6d. a yard, the position is that the effective protection given under the Lyons tariff is 106 per cent. compared with 134 per cent. under the Scullin tariff. Under the Lyons tariff, the average effective protection, leaving out exchange and primage, is 71 per cent. To give a rough and ready figure, it may be said that a 4s. article is landed at about 8s. 9d., and is sold by the importing wholesaler at 10s. 6d. Before it reaches the Australian consumer it probably costs three times as much as it would cost the consumer in Great Britain.
And now as to the criticism offered by the honorable member for Perth (Mr. Nairn), there are factors adverse to the Australian industry that cannot be expressed in quantitative terms. It is interesting to find that the Tariff Board has given due weight to them in arriving at its recommendations to Parliament. I refer to theunfortunate tendency of certain sections of this community to give preference to imported materials to the detriment of local goods, even when price and inherent quality make the local goods better value. This is a relic of the old days that is not yet dead.
– I think that it is dying.
– I hope so. Another factor is the importation - I hesitate to use - the term “ dumping “ - of endofseason goods at low prices due to the seasonal difference between the two hemispheres. These factors have been kept in mind by the Tariff Board in recommending rates of duty.
The real menace to the industry at the present time is the very cheap women’s material that is coming into Australia from certain foreign countries. The negligible prices at which these materials are being sold can mean nothing less than that dumping is being practised in an extreme form. I know that the Government is aware of this, but I take this opportunity to direct its attention again to this problem in the interests of the light-weight section of the Australian textile industry, the future of which is definitely menaced from other than British sources. I have in my hand a sample of material from a foreign country. If is under 3 oz. to the square yard, and it is coming into the merchant’s warehouse at ls. 4d. a square yard. That is a price which barely pays the cost of the material and overhead charges, and certainly does not cover the cost of labour at the rates which we pay in Australia. *
– What material is it?
– Women’s light material under 3 oz., of quite a good appearance, and I am assured that it is the only foreign material - it comes from Japan - that is competitive with the Australianmade material to-day. One hears a great deal of woollen tweeds and other woollen materials from Japan,- but I am assured by wholesalers that the only material that is competitive with the Australian article at present is that to. which I am referring. It cannot be made in Australia at less than a price which is considerably above that of the article imported from Japan, and it would be purchased solely by persons who pay regard only to the question of price.
Criticism is contained in the report of the Tariff Board, and has been voiced in other directions with reference to the deliveries by Australian manufacturers, but I point out that Australian merchants are getting deliveries from Australian mills at a considerably better rate than they could ever have expected from British mills. Through having a source of supply on the spot merchants are tempted to hold back the placing of their orders until they are certain of being able to sell the goods. I make no apology for the deliveries, because the figures that I have seen over a fairly wide range are really very satisfactory. The business is to a large extent seasonal and the orders for the winter season come in during the first four months of the year. The rush in the local mills during the last four months has been phenomenal, and the mill managers have been making Herculean efforts to cope with the rush. The textile industry in Australia is organized on a different basis from that of the industry in England. Here, the mills attempt to produce a wider range of materials, and therefore they desire to know three months ahead what their orders will be in order to arrange their programme on an economic basis. However, apart altogether from the percentage of protection that the Australian textile industry enjoys at the presenttime, the gist, of the position is that the Australian mills have, practically speaking, secured the whole business under existing conditions of tariff and exchange.
Fears have been expressed that, if, and when, the exchange runs off the situation will alter in favour of imported materials. This, I think, is taking a jump before it is reached. I do not think that any one sees an early downward movement of the exchange rate, but even if that- happens Ave have the ready remedy of the resubmission of this item to the Tariff Board. I should like to have an assurance from the Minister that, in the event of a sudden decline in the exchange rate through world conditions, to the detriment of the Australian woollen textile industry, he will re-submit this item to the Tariff Board.
I should like to discuss other aspects of this matter, but time will not permit of that. However, in the short time that remains to me, I should like to put forward a tentative proposal to the Minister. This item covers a very wide range of types and qualities of textiles, and as it is quite impossible to fix a rate of duty that gives fair and reasonable protection to every article within that wide range - some would be under protected and others over protected - I suggest to the Minister the possibility of subdividing the item so that the protection given might be more scientific and less by-and-large.
Before I finish this part of my speech I should like to say that the mills at Geelong, which I think are representative of all the woollen mills of Australia, are open to inspection, and the manufacturers welcome inspection by any responsible person, desirous of seeing how the industry is conducted.
I desire to refer to the remarks of the Deputy Leader of the Opposition (Mr. Forde) that certain men were discharged from one mill in Geelong, because of the Ottawa agreement. This was not a chance remark, because it was repeated after being replied to, and the honorable member exulted in the statement. I give a direct denial to any possibility of 90 men having been put off by reason of the Ottawa agreement. They were undoubtedly put off.
– That was denied. In any case, I did not say that they were put off as a direct result of that agreement.
– Undoubtedly they were put off, but it was for a variety of reasons, none of which had any connexion with the Ottawa agreement. The particular mill referred to makes a medium grade of material, of which there is practically no importation from abroad, and the 90 men concerned were employed on that class of work. I am sure that the Deputy Leader of the Opposition is aware that the usual practice in the great majority of the woollen mills of Australia is to work one shift only. This is due to technical reasons dealing with dyeing and with other aspects of the process of manufacture. This mill, however, was working a night shift to enable it to cope with a particular order, and when that order was completed these 90 men were dismissed. There is no suggestion that their dismissal was due to the Ottawa agreement, or was in any way connected with the tariff. I should like to hear an explanation by the Deputy Leader of the Opposition as to how he connects the matter with the Ottawa agreement. If figures were available dealing with the hiring and engaging of labour in the textile industry generally, they would show no diminution today in the average number of men engaged. Under present conditions, the tariff assures to the Australian mills the vast bulk of the trade. They enjoyed 97i per cent, of it last year, and this year they will probably have 95 per cent, of it. The industry is thriving, and never in the history of this country was employment in the textile industry so high as it is to-day. The present duty is adequate. No harm was done to the industry by the reduction of duty made in September last. We have not gone back to the level of the BrucePage tariff. Any lower duty, in certain lines at least, would probably not help Britain, and would, probably, help the foreigner. I am quite sure that this industry is perfectly safe in the hands of the Government, and that the Government realizes its importance to this country from many points of view.
.- The woollen textile industry is one of the big natural industries of Australia, and I believe that the majority of honorable members, apart from those who are ardent freetraders, are interested in its progress and development. There is in Australia to-day sufficient plant to meet the whole of the Australian demand for all the goods that come under this item. .An important point that must not be overlooked is that the establishment of this industry in Australia has been most beneficial to Australian wool producers, because the competition of buyers from the Australian mills with those from Japan, Belgium and other continental countries at the periodical wool sales, has had the effect of forcing up prices. On numerous occasions the increased price paid as a consequence of this competition has amounted to at least id. per lb. The purchasers of Australian -wool for use in the Australian mills have increased from 66,000 bales in 1906-07 to 136,000 bales in 1915-16, and to 252,000 bales in 1931-32. This great woollen textile industry, in which is invested approximately £6,000,000, which uses £4,000,000 worth of raw material, employs directly 12,000 persons, and pays in wages £2,000,000 per annum, is entitled to adequate and effective protection. I make no apology for having been Minister for Trade and Customs in a government that gave a degree of protection that was tantamount to prohibition against the importation of such goods as can be efficiently and economically manufactured in Australia. Although the mills are at present busy on account of seasonal demands, and the execution of orders or contracts that were entered into between July and December last, there exists in the industry to-day a real apprehension that these reduced duties may result in increased imports from Japan, Great Britain, and other countries. Those who are engaged in the manufacture of these worsteds and lightweight dress materials, already have in their possession evidence of the fact that many buyers ‘ are negotiating for imports, and are refraining from ordering in the quantities that they ordered last year. The only way in which the existing state of employment in the industry may be maintained is by the continuance of adequate protection. The industry should not be dependent upon the protection afforded by exchange and primage duty, that is not a lasting protection, because, in three or four months, it may be non-existent. .The honorable member for Corio (Mr. Casey) has suggested that, in the event of the loss of the protection afforded by those two factors, the matter should be referred to the Tariff Board. That board, however already has before it a couple of hundred items, which will keep it fully occupied for at least nine months, and there WOUld be unavoidable delay that might have disastrous effects upon the employment provided by this great industry.
In a speech that he delivered last October, the Prime Minister (Mr. Lyons) claimed, on behalf of his Government, that no protective duties had been reduced. We are now told that the reductions in regard to woollen piece goods are not in any way due to the Ottawa agreement. Let us examine the facts. The Ottawa Conference ended on the 20th August, 1932; and on the 1st September, only twelve days later, the then Assistant Minister for Trade and Customs (Mr. Perkins) tabled in this committee a tariff schedule that made drastic reductions in 34 items. The protection afforded to woollen worsteds weighing 6 oz. and over was reduced by one-half. It may be claimed that that was merely a coincidence. It appears to me, however, to have marked the inauguration of a policy of tariff reductions, upon cabled advice from the Australian representatives at Ottawa. We were informed that the Government
Avas in direct cable communication with those representatives, just as it was said recently that daily cable communication Avas being maintained Avith Senator Greene, who, on behalf of the Commonwealth Government, conducted certain negotiations Avith the New Zealand Government. I cannot believe that the Assistant Minister for Trade and Customs had not received cable advice from the then Minister for Trade and Customs (Sir Henry Gullett) and from the Resident Minister in London (Mr. Bruce), that they had agreed to substantial reductions of duties in the case of woollen piece goods, and that it would be good diplomacy to include those reductions in the tariff schedule that was to be brought down on the 1st September. At about the same time one of the British delegates, referring in the House of Commons to what the Australian representatives had agreed to, said - -Australia had expressed a willingness to reduce tariffs until our manufacturers were able to compete.
This, doubtless, was one line in which they hoped to be able to compete as the result of the reductions promised by the Australian representatives. The present duties reduce the protection from 2s. and 3s., and 35 per cent, and 50 per cent;, to ls. and 2s., and 30 per cent, and 50 per cent. With respect to weights over 6 oz. a square yard, that is a reversion to the Pratten duties. In regard to weights of from 3 oz. to 6 oz. greater protection is provided than Avas given by the Pratten tariff, but it is only about onehalf that afforded by the duties imposed by the Scullin Government. When the Scullin administration came into office it was approached by numerous deputations from the woollen manufacturers and the workers in the industry, and was informed that the mills were only working half time. I visited the mills at Geelong, Ballarat and Melbourne, and went into the case very carefully. I found that the representatives of the industry and of the employees in it had stated the facts correctly. A statement by Mr. S. H. Jones, the representative of the workers at Geelong, is typical of the reports that were furnished in 1930 by practically all the big centres in which woollen mills were operating. It is as follows: -
The trade at Geelong is still feeling the depression, and the outlook is anything but promising. The Albion Mills are working full time. At the Federal Mills, members in some departments are losing a great amount of time. Hirst’s Mills are in a very bad way; one of the mills is closing down this week. The Valley Mill is working overtime in some departments, and three, four, and five days weekly in other departments. Collins Brothers arc on short time, and are reducing hands.
The duties imposed by the Scullin Government were intended to afford adequate protection. Less than effective protection would have been useless at a time when it was necessary to stem the tide of imports and to rectify our adverse trade balance. It was satisfactory to that Government to find that the number of employees in 27 mills in Victoria rose from 6,238 on the 1st December, 1930, to 8,901 on the 1st May, 1932- all of whom were working at least full time, and some of them overtime. Unfortunately, owing to the apprehension that exists in the industry to-day, and to the falling off in the forward orders that were received from six to twelve months ago, there will be a declining rate of employment. The mills are busy to-day because they are meeting orders that were placed from six to twelve months ago. I have here a letter from the manager of one of the big mills, dated as late as the 4th April last. It reads -
In regard to trade generally : At the moment, we are rushed with immediate orders, but we are not booking very well on forward orders. Competition from Japan is growing daily, and the attitude of the Government in reducing the foreign tariff will have a strong rebound on Australian industries shortly. The reduction on British goods brings us into keen competition with the Old Country, particularly if exchange and primage is tampered with.
All manufacturers are definitely perturbed about the future.
That is typical of the fear and the apprehension that exist in the minds of the leaders of this industry. They do not know what is going to happen next. The honorable member for Corio suggested that, should the exchange drop, the matter should be referred to the Tariff Board. I urge the Minister not to waste time by referring the matter to that body, but to investigate the circumstances with the assistance of the experts in his department, so as to ensure the maintenance of the effective protection that is given to the industry. In 1929-30 the increased rates under the Scullin schedule - 2s. and 3s. plus 35 per cent. and 50 per cent. - operated. In 1930-31, the 3-oz. minimum came into force, with the increased rates of British 2s. and 35 per cent., foreign 3s. and 50 per cent., and, n.e.i., British 45 per cent., foreign 60 per cent. Consequently, the position in regard to importations can be judged only by taking the figures for 1928-29. The statistical figures in relation to importations are as follow : -
It will be seen that slightly more than one-half of the total importations were of woollen piece goods over 6 oz.
– That is a picked year.
– I have taken a normal year before the duties were interfered with.What must be the inevitable result of the present duty, which, on materials 6 oz. and over, operated under the 1921-28 tariff? In 1928-29, the imports were valued at £690,000. Exchange, it must be borne in mind, is only .a temporary measure of protection ; there is no stability about it. In 1925 the Tariff Board, which then had a truly Australian outlook, spoke of this industry in the following terms : -
With adequate tariff protection, there is no reason why Australia should not take her proper position in the world’s production of woollen goods.
Investigation shows that the mills of Australia are capable of producing all requirements so far as men’s fabrics are concerned, and the quality is equal to those produced in the United Kingdom, and consequently equal to, or better than, the production of other countries.
That was eight years ago, yet the honorable member for Perth (Mr. Nairn) said to-night that people who want good worsted are prepared to pay more to obtain the imported article. During those eight years considerable development has taken place in the Australian factories.
– They manufacture only a limited number of lines.
– The Tariff Board made a further investigation into this industry in 1932, when it reported -
The local production of materials for men’s suits and overcoats compares favorably with the imported cloths both as regards quality and price over a large proportion of the range. Furthermore, the variety of design and qualities produced is adequate to’ supply a very substantial proportion of the demand.
The Australian industry is efficiently conducted, and both the quality and the price of its goods are satisfactory to ali but the most prejudiced persons. Unfortunately, the effective tariff protection granted to the woollen industry by the Scullin Government is being whittled away, and those engaged in the trade view with apprehension the reduction of duties in the present schedule. The position is somewhat less serious than it would be were it not for the .assistance of the exchange and the primage duty. I hope that those factors will not be taken into consideration by the Minister when determining whether or not the protection afforded to this industry is adequate. During 1927-28, woollen piece goods to the value of £2,483,413 were imported. Of that amount, £396,474 represented worsted piece goods as ordinarily used in the manufacture of outer clothing for human wear; £1,163,756 represented piece goods made wholly of wool, and £676,419 represented woollen piece goods mixed with cotton or other materials for similar wear. Other woollen piece goods imported were valued at £180,535. That such heavy importations took place after the Pratten duties came into operation shows conclusively that those duties were insufficient to protect the Australian industry. When the Scullin Administration assumed office, millers and millworkers adduced evidence to show that many of the Australian mills were working half time. Since the present Government came into power, the importations of woollen piece goods have increased. That fact the honorable member for Corio attempted to brush aside lightly.
– I can supply the figures.
– During the first seven months of the present financial year, the imports of woollen piece goods showed an increase of over 250 per cent, compared with the corresponding period for the previous year. According to figures supplied by the Commonwealth Statistician, the woollen piece goods imported during a period of eight months in 1931-32, were valued at £26,442, and for the corresponding period of 1932-33, at £75,800- an increase of nearly 300 per cent. The total importations of textiles during the period first mentioned represented a value of £6,509,827, compared with £8,700,804 for the latter period.
– I question the accuracy of the honorable member’s figures.
– The figures I have given are from a return compiled by Mr. E. 1 T. McPhee, the Commonwealth Statistician. They show a substantial increase in respect of the importations of textiles.
– That is ridiculous.
– During February, 1932, woollen piece goods to the value of £4,707 were imported, whereas in the corresponding month of this year, the importation of similar goods represented a value of £20,398.
Not only does the great woollen industry give direct employment to many thousands; but indirectly in the making of containers, the provision of power and light, the supply of lubricating oils, bales, labels and other articles, .and in repairs to plant, it gives employment to many more thousands. These facts should not be overlooked when determining what assistance should be given to this industry. Of the 115,000,000 sheep in Australia, the clip from 8,000,000 is used in Australian woollen mills.
From the foundation of the Parramatta factory by Governor King, 130 years ago, until federation, nearly a century later, the woollen manufacturers in Australia had a chequered career. In. Victoria, where a protectionist policy was put into operation long before federation, the industry was placed on a much firmer foundation than in the other States.
The CHAIRMAN (Mr. Bell).The honorable member is getting rather wide of the item before the Chair.
– I was pointing out the development that has taken place in this industry, with a view to showing the necessity for a continuance of the policy of protection. In New South Wales, however, the absence of a continued policy of protection caused investors to be unwilling to invest their money in the industry. Under federation, with its uniform fiscal policy for all Australia, the industry improved. The value of the plant and machinery used in the manufacture of woollens and worsteds in 1930- 31 was £3,567,000, and during the same year, the output of the mills, including the value of the raw materials at sundry stages, was valued at nearly £7,000,000. If the value of these raw materials is deducted, it will be seen that the productive processes applied by skill and industry represented £2,700,000, of which £1,633,000, or approximately 60 per cent., was paid in wages, which were distributed among 12,000 employees, of whom 5,500 were males, and 6,500 females. During the year that I have mentioned, Australian woollen mills used 18,300,000 lb. of scoured wool, representing about 50,000,000 lb. of greasy wool, which is equal to the clip of nearly 8,000,000 sheep. That consumption of wool shows an increase of over 30 per cent. on the wool used in 1924-25, before the Pratten tariff gave to the industry a fair measure of protection.
There is no justification for importing into Australia any blankets, flannels, woollen piece goods or light-weight dress materials. Before the Scullin Administra tion extended the protection given to lightweight dress materials, many of the woollen mills of Australia were working only half time. Credit is due to those engaged in this industry for the variety of dress materials which they now produce. That their quality is equal to the best that the world can produce, one can realize examining the samples left in the library by the honorable member for Corio. Although about eighteen months ago I was able to show honorable members a wide assortment of Australian dress materials, that range has increased considerably in the meantime. On the grounds that we produce the best wool in the world, that this industry gives employment directly to 12,000 persons, and indirectly to at least 50,000 persons, I submit that the Government should hesitate before doing anything which may jeopardize its future progress. I fear that the pressure of freetrade advocates and the desire to comply with the Ottawa agreement, by giving British manufacturers a better opportunity to compete with Australian woollen mills, may lead to a further reduction of duties. The action of the Scullin Administration in imposing effective protection had most beneficial results in this industry, but, unfortunately, since that Government went out of office, the importations of these goods have increased. I hope that if the Minister sees any substantial increase of these importations, he will” take immediate action to stop them in the interests of this great Australian industry and those engaged in it.
.- Will twaddle of the sort to which we have just listened build up Australia industrially? Can the Australian worker and manufacturer do nothing in competition with their rivals in other countries? Are we to continue protecting them by increasing the artificial barriers when we know that, even at the present time, discussions are proceeding in the United States of America between the governments of three of the leading nations with a view to retrieving the world from the dreadful economic position into which it has drifted through nationalism carried to extremes? The honorable member for Corio (Mr. Casey) has admitted that the protection enjoyed by the manufacturers of woollen piece goods is. fully 100 per cent., yet the honorable member for Capricornia (Mr. Forde) asks that higher duties be imposed. Is Australia supported wholly by the factories in the large centres of population ? Do not honorable members realize the existing depression throughout the country, and the reduced purchasing power of the people? In each State are large numbers of unemployed. Yet honorable members would ask the people to pay fictitious prices for every article they wear or use. The honorable member for Corio painted an attractive picture of the prosperity of the woollen manufacturing industry at Geelong, but I again remind him that under the Ottawa agreement the Commonwealth undertook that - during the currency of this agreement the tariff shall be based on the principle that protective duties shall not exceed such a level as will give United Kingdom producers full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production, provided that in the application of such principles special consideration may be given to the case of industries not fully established.
If protection up to 100 per cent, is needed to maintain manufacturing industries in this country, what hope have we of building up a great nation? To-day, not one article manufactured in Australia can be sold commercially in any other country. The honorable member for Capricornia said that the higher protection of %the manufacturers of woollens is needed to help the pastoralists. Recently, I had to pay 16s. for a singlet. Such prices, instead of helping the wool-grower, drive the public to substitutes. The “use more wool” campaign becomes futile when, by excessive prices, we force the people to buy substitutes for wool. The Melbourne Argus recently published a letter relating to the duties on woollen piece goods signed by Buckley and Nunn Limited, Myer Emporium Limited, Craig Williamson Proprietary Limited, Ball and Welch Limited, and Hicks, Atkinson and Sons Proprietary Limited. I quote a portion of it-
We, as representing the leading retail organizations, whose prosperity depends upon Australia’s prosperity, are strong advocates of the protectionist policy. We believe, however, that protection imposed without adequate investigation and thought as to the consequences can do incalculable harm. In the case of the item mentioned and certain other items of recent schedules it is our considered opinion that Australian industries will lose infinitely more than it will gain. We ask, therefore, that full investigation be made into the effects of this and certain other excessive tariff increases before’ the schedules become law. Further information will be gladly given as to other items, if desired. It is our considered opinion that in the great majority of cases the manufacture of the light woollen goods affected by the new duties could not be attempted in Australia. To a great extent such goods have been produced by overseas manufacturers in a special effort to meet the menace of the growing popularity of artificial silk and other substitutes for wool. Their success is one of the few bright spots in the outlook for a recovery in wool prices. By the Government’s action any assistance that the Australian consumer might be able to give to the “ use more wool “ movement by using these fabrics is rendered out of the question. It will now be beyond the purse of the public, however patriotic, to buy these attractive light woollen materials any longer.
An honorable member told me recently that when he attempted to buy Crimean shirts in Sydney he was asked to pay 25s. each. These high prices press very hardly on the poorer sections of the community. There must be something seriously lacking with Australian manufacturers and workers when they ask for protection of 100 per cent., and, in some instances, over 300 per “ cent., against foreign competition.
.- Reference has been made to the quantity of wool in a suit of clothes, and for the information of the committee I put on record the following evidence tendered to the Tariff Board, but not published in its report: -
At the Sydney inquiry you, Mr. Chairman, remarked that you had often wondered why 14 oz. of wool can be bought for 8d. or 9d., when it costs a guinea for a piece of tweed; presumably you were referring to high grade suitings. Mr. Westmore also referred to a fall of more than half in wool costs, conveying a suggestion that manufactured materials should also fall half. Firstly, the 14 oz. of wool in the cloth would be the result of treating about 1 lb. of wool as shorn from the sheep, the balance of the weight being made up of unsuitable oddment wools sorted from the shorn fleece, grease and dirt taken out in scouring, and noils and waste taken out in combing and spinning. The value of the byproducts referred to is, of course, allowed for, but with wool at 9d. per lb. would not represent more than about IS per cent, of the cost of the 2i lb. of greasy wool. Additional materials, such as soap, soda, dyes and chemicals are used in the manufacturing processes, and before wool reaches the cloth stage it has to pass through about 45 to 55 processes, each entailing expense in the form of labour, supervision, machine and overhead charges, &c. After the manufacturer comes the distributor, who has to cover his own expenses and risk of loss in bad debts, &c, so when a guinea is spent on cloth, not only is wool bought, but a contribution is also made to the livelihood of an army of workers. This particular portion may not be regarded as relevant to the matter under consideration, but it may help to remove some misconceptions regarding the costs of the products of the industry.
– Did the witness say nothing about the livelihood of the woolgrower ?
– The livelihood of the wool-grower is involved in the local manufacture of the raw material he produces. I am afraid that sometimes the Tariff Board is guilty of a dereliction of duty in not conveying to Parliament, through its representatives, vital information. For instance, I know that sworn testimony was submitted to the board that prior to the local manufacture of light woollen materials the prices of imported piece goods were much higher. Subsequent to the commencement of local production the prices of some materials were reduced by 5s. a yard.
-Would not that be accounted for by the low price of wool?
– Only partly. Often local manufacture is followed by a reduction of prices, and, when that occurs, the board should inform Parliament. Some honorable members would have people believe that all imported woollen goods are the product of Australian wool. I remind the committee that South Africa, the Argentine, and other countries also grow and export fine wool, and that at least a proportion of imported woollen goods is of foreign origin and foreign material, whereas the fostering of local manufacture means that all processes from the sheep’s back to the wearer’s back are carried out in Australia to the benefit of the local woolgrowers, manufacturers, and workers. The honorable member for Corio (Mr. Casey) called attention to the fallacy of always quoting the f.o.b. price in England against the retail price paid in Australia for local products. The c.i.f. prices would be fairer, but the only real comparison is between the prices of the importing warehousemen and those of the manufacturers. Such a comparison would show only a fractional difference in the charges paid by the consumer. Only a few days ago attention was called to the fact that the purchases at the wool sales by Australian manufacturers had considerably influenced the prices of several grades of wool. An increased demand for wool is arising from the manufacture of articles not previously produced in Australia. Many mills are making beautiful woollen ties which the public should wear in preference to ties produced from imported silk. Owing to the demand for these woollen ties and light dress materials local manufacturers are able to bid more vigorously at the wool sales, and this in turn helps the pastor alists. A pleasing feature of the woollen textile industry is its wide distribution throughout Australia. I know of no other secondary industry that plays so important a part in the industrial support of country towns. In Victoria woollen mills have been established at Wangaratta, Sale, Warrnambool, Ballarat, Castlemaine, Stawell and Geelong. Geelong holds the premier position in respect of both the number of mills and the quality of the materials produced. A number of mills have been established in the country areas of New South Wales and Victoria, and that is a fine thing for Australia generally. The proprietors of these mills have incurred considerable expenditure in developing the industry. They have imported textile machinery from the Old Country, and that, of course, has given a certain amount of trade to Great Britain. From the 1st January, 1929, to the 1st of July, 1932, 25 woollen mills expended £324,000 on the installation of modern machinery, and seventeen mills expended £185,000 on the manufacture and improvement of materials. It is expected that an additional £49,000 will be expended by other mills. This expenditure has had the effect of providing more employment and of increasing the use of Australian raw materials.
– Apart from profits how much money did the companies themselves put into these ventures?
– The capital has been raised practically in Australia, and, in some instances, over a wide area indeed. An examination of the lists of shareholders of Australian woollen mills will show that they compare favorably with any other company arrangement. The shares of certain mills are spread over a large number of people.
I hope that if this industry is at any time faced with danger in respect of either loss of employment or depression of trade consequent upon the competition of foreign countries, the Minister, instead of adopting the slow process of instructing the Tariff Board to review the industry, will take immediate action in this Parliament to prevent this industry, which provides so much employment in the community,, from being destroyed. Some honorable members, including the honorable member for Swan (Mr. Gregory) do not refer so frequently as they did before, to the tariff policy of Great Britain, for the simple reason that Great Britain has, in a measure, adopted a protective policy. English journals which at one time had freetrade ideas - the Times and the Daily Telegraph - are now advising the British Government to impose immediately duties of up to 100 per cent., so as to protect British industries from competition that is likely to ensue, because of the action of the United States of America in going off the gold standard. When I was in England some years ago, most of the members of the British Labour Party were advocates of freetrade, but the greater number of parliamentarians were in favour of a protective policy to prevent the dumping in Great Britain of foreign commodities. England has to-day adopted a moderate protective policy, and that, of course, will place it upon a better trade footing when bargaining with other nations. We should have no hesitation in passing this sub-item. Honorable members generally are conversant with the ramifications of the industry, and are desirous that it should prosper. The honorable member for Perth (Mr. Nairn) can at least console himself with the fact that he started this discussion. I hope that he will rid himself of his delusion that the only good material is imported material. We should do everything in our power to encourage this industry, which is providing employment for many of our own people.
.- One of the arguments of the honorable member for Maribyrnong (Mr. Fenton), in support of still higher duties, is that the shares of the textile companies are really excellent buying. I would point out to him that the shares of the sugar companies are also excellent buying.
– The shares of the match companies are better buying.
– That is so. This is but another example of companies which take control in the early stages of an industry producing goods required by the people. Their shares are good buying, and are likely to continue so while the industry is protected with an excessively high tariff.
The advocates of the textile industry have seriously contended that the price of Australian wool has appreciated because of the competition of Australian buyers in the local market. The proportion of Australian wool used locally is about 5 per cent, of the total output. The figure quoted by the Deputy Leader of the Opposition (Mr. Forde) was 7 per cent., and I shall accept his figure. It would be difficult to convince any person other than a protectionist that the buyers of 7 per cent, of any commodity could set the market as against the buyers of the remaining 93 per cent. It is obvious that the smaller buyers follow the market set by the larger buyers. When the textile industry becomes as efficient as its advocates seem to think it is now, it will perhaps be able to compete in the markets of the world. The honorable member for Corio (Mr. Casey) did give us some information on which reliance could be placed. He showed that even under the reduced tariff proposals of the Government, the effective protection is 106 per cent., and that the industry is thriving. What industry would not thrive under such conditions, when it is a national industry, producing goods which are required by the community generally? Any industry which enjoys such a large measure of protection must thrive, but only at the expense of the people who are using its products. Honorable members speak of this as a national industry; but I ask them to compare its position with that of the great national industry of producing wool. Whereas the smaller national industry enjoys a protection of 106 per cent., the larger national industry sells its goods in the markets of the world without any protection at all. There is no element of fairness in the protectionist scheme. It has been pointed out that, in respect of some woollen goods, the price in Australia is three times that in England. This gives us some idea of the excessive price which the people of Australia are paying for their woollens. Some day the workers generally will awaken to the fact that they are being exploited by the manufacturers and their fellow employees in the textile industry, and will force them to supply commodities at a price more compatible with that ruling overseas.
.- No one will deny that the woollen textile industry is one of our great natural secondary industries. It is also agreed that it is efficient, and that despite the high duties that have been imposed, it has never attempted to exploit the community. Surely, then, it is an industry which is well worthy of adequate protection. During the last few years it has developed considerably. To-day it has captured 95 per cent, of the Australian market, as against 66 per cent, which it held a few years ago. We cannot expect it to capture 100 per cent, of the local market. So many people have a prejudice against Australian goods, and will buy only imported materials. There has, however, been a change in their attitude lately, because the expansion of this industry has had the effect of breaking down to some extent the barriers of prejudice which were at one time erected against it. A fortnight ago I walked into a large city house and asked to be shown some suiting materials. A large range of materials was placed before me, at prices ranging from 11 to 13 guineas. In every case the material was imported. The price of one, a serge, was 11 guineas. I asked what was the price of a suit of similar material of Australian manufacture, and was told that it was 9 guineas. The salesman considered that the quality of the Australian article was equal to that of the imported articleTaking the actual difference between the costs of manufacture as 8s. or 10s:, it will be readily seen that an additional 30s. or 35s. is charged those persons who are prejudiced against Australian goods. The - particular firm to which I refer did not show me any Australian goods until I specifically asked for them. I believe that this is a common practice with many of the bigger houses.
I regret that the honorable member for Perth (Mr. Nairn) should have criticized the quality and range of Australian manufactures. This, I believe, is to be taken, not as prejudice, but as lack of knowledge on his part. The next time the honorable member visits Sydney I shall invite him to visit one of the mills in my electorate, and I think that he will then be satisfied that his remarks were unwarranted. The honorable member for Forrest (Mr. Prowse) also complained of the degree of protection provided for this industry, and said that the cost of distribution was far too great. I do not think that the cost of distribution should be a factor in determining the degree of protection which an industry needs. A good deal has been said during this debate about the present state of this industry. The Globe Mill, in my electorate, has increased the number of its employees by 100 in the last four months. The plant is being worked at the maximum overtime permitted by . the .State laws. The manager informed me recently that the factory could be extended, but that he was not satisfied with the degree of security that was being given to the industry. I join with the honorable member for Corio (Mr. Casey) in requesting the Minister to give this industry adequate assurances that it will be- fully safeguarded. If this is done, increased employment will be provided, even with the existing duties.
.- After hearing so many honorable members extol the value of the woollen textile industry to Australia, I begin to fear that we shall kill the patient by too much kindness. We all hope that this great industry will develop to such an extent that it will be able to use a good deal more of our Australian wool than at present.. In the latest Year-Booh that is available, the figures indicate that the local mills used less Australian wool in 1930-31 than in 1926-27, the respective figures being 45,435,185 lb. and 52,127,351 lb. This reduction is not due to the shortage of supplies, for the export figures show that, in 1926-27, 688,000,000 lb. of wool was exported, while, in 1930-31, 768,000,000 lb. was exported. It appears, therefore, that, although the Australian mills are being given substantial protection and much encouragement, they are not manufacturing as much Australian wool as they did four or five years ago. The Deputy Leader of the Opposition (Mr. Forde) has told us that the Statistician’s figures are the final authority. I agree with him, and ask the Minister if he will be good enough to explain why there has been this reduction of consumption by the local mills. The honorable member for Swan (Mr. Gregory) has pointed out that it is a poor policy for us to impose heavy duties on goods which cannot be manufactured in Australia, for the only result is an increase of price to the public. Surely the Government and this Parliament have a duty, not only to the people of Australia, but also to the producers engaged in this and other great Australian primary industries! I should like to know whether the Minister has any figures to show that the situation indicated in the figures which I have quoted has altered, or whether he can explain why these woollen mills, which are being praised so highly, are using less Australian wool than formerly.
.- The honorable member for Gwydir (Mr. Abbott) has asked me a pointed question, and, in reply, I direct his attention to a publication with which he should be acquainted, namely, the quarterly report of the Australian Estates and Mortgage Company Limited, dated the 19th April, 1933. The particular paragraphs to which I refer read as follows: -
Australian manufacturers, it is estimated, will secure in the vicinity of 250,000 bales before the end of June, and had it not been for the demand from this section of the trade for good to super merinos - which have sold disappointingly at relatively very cheap prices - rates would unquestionably have been lower still.
Conditions ruling in Australian centres when sales were resumed in January after the recess were distinctly encouraging, a rise in values of from 5 per cent. to 10 per cent., when compared with December levels, being recorded for almost all descriptions with competition as general and as widespread as at any time this season.
Honorable members who decry our great Australian industries and dogmatize on the desirability of removing all duties might well ask themselves what would happen to our great primary and secondary industries if all duties were discarded. We cannot afford to look at these subjects from the purely selfish point of view, seeing that in this great country, with its 6,500,000 people, our largest aggregations of populations are in our capital cities. If we abandoned our protective policy, could those engaged in primary industries absorb the artisans who would be thrown out of employment, and would it be possible for us to pay our old-age pensions and maintain our other social services without customs revenue? I think I have given the honorable member enough to think about, but I also remind him that, in 1930-31, which was one of the years lie quoted, we were in the depth of the depression, and that the purchasing power of our people declined seriously in that year. I think the honorable member should have been able to do something better than quote the figures he used.
The Deputy Leader of the Opposition (Mr. Forde), in discussing this item, suggested that there had been such a serious reduction of duties as to jeopardize the industry, and he also had something to say about the reduced duties causing more unemployment and about whittling away thetariff protection hitherto accorded to this industry. But the honorable member for Corio (Mr. Casey) has shown conclusively that the textile mills of Australia, and particularly those of Geelong, in his own electorate, are busier than they have ever been. Sub-item 105 f 1 covers woollen outerwear fabrics weighing more than 3 oz. per square yard, and sub-item 105 f 2 covers woollen outerwear fabrics weighing 3 oz. or less per square yard, and woollen piece goods of any weight for underwear. The duties in respect of the first item have been slightly reduced, but it has not been suggestedthat those provided for the other sub-item are inadequate. The most significant alteration that’ has been made is the reduction of the weight limit of the fabric covered by sub-item f 1 from 6 oz. to 3 oz. per square yard-. Actually, the duties are higher now than they were under the 1921-28 schedule. This has had the effect of enabling the local woollen mills to secure a large volume of the trade in light weight fabrics which previously was held by the importers. Inquiry recently by the Tariff Board in regard to the duties on these goods showed that in 1928-29, the local manufacturers had been successful, under the duties then in operation, in meeting 65 per cent, of Australia’s requirements. On page 9 of the board’s report, the details of the production of 24- woollen mills for the years 1926 to 1931 are given. In 1931, there was actually a drop in the quantity and value of the goods produced weighing over 6 oz. It will be seen, therefore, that the Scullin tariff did not have the effect which has been claimed for it. The previous duty was adequate to protect the manufacturers of the heavier weight material, and figures have been quoted during this debate to show that the present rate of duty is more than sufficient to enable the Australian industry to give employment up to its full capacity and yet protect the consumers of these goods.
Women’s light-weight woollen fabrics, which generally weigh less than 6 oz. per square yard, are in a somewhat different position. The demand covers a very wide range, and while quite a number of lines can be supplied by the local manufacturers at a reasonable price, there are others which, by reason of the small demand, are not a commercial proposition to those manufacturers. In such instances, the high duties imposed by the previous administration were in the nature of a burden on the consumers. The board set out in table B of its report a number of instances in which manufacturers can produce many light-weight fabrics at the present time at a price approximately the same as, and in some instances actually lower than, the landed price of comparable imported cloth, including duties at the proposed rates, but excluding primage and exchange. As the Australian manufac turers’ costs are based on the higher cost of wool due to the exchange position, it naturally follows that if the exchange between England and Australia falls, then the price of wool in Australia will be reduced as compared with the price in the United Kingdom, and the relative position will thus be more favorable to the Australian manufacturer than table B of the board’s report indicates. The proprietor of a wool-scouring firm in Geelong told me that he now found the best market was the local one, and that he received better prices in Geelong than by shipping overseas. We all know that the wool-growers and other primary producers are having a very hard time at present, but we must look at this subject from the point of view of all sections of the people. Every man on the land knows that his prices are controlled by world conditions. There has been a catastrophic fall in. world prices, but I point out to the honorsable member for Swan (Mr. Gregory),, who deplores the fact that we are protecting local industries to the extent that we are, that Australia is in a happier and better position than any other country in the world.
– In the cities!
– In every part of the country. The United States of America is having such a difficult time that, despite all of her wealth, she has gone off the gold standard, and is depreciating her currency in an endeavour to get back some of her lost trade. Owing to the Ottawa agreement, trade is flowing within the British Empire to the benefit of every primary producer here, and that fact should be recognized by members of the Country party. We have an expert Tariff Board that takes evidence from both sides, and arrives at an equitable and judicial decision. Members of the Country party should not set. themselves up as a higher authority than the board. Another group in this chamber declares that prohibitive duties should be applied ; but the Government desires to hold the balance fairly between the primary and secondary industries, in order to do the greatest good to the greatest number.
The point was raised by the local manufacturers that a higher protection was needed than that accorded by the 1921-30 tariff to overcome the preference of some buyers for imported goods, and to provide adequate safeguards against the importation of end-of-season goods at low prices. The Tariff Board has taken this factor into account, and the duties proposed are considered to be sufficiently high to meet this eventuality. An important point made by the board is that unreasonably high duties would result in the demand swinging away from woollen piece goods towards silk and artificial silk piece goods, dutiable at low rates of duty. The Deputy leader of the Opposition said that certain goods - gabardines - had been allowed into Australia under by-law instead of a certain rate of duty being charged. It is provided under the tariff that the goods must resemble woollen piece goods, but gabardines do not resemble them, and for that reason, were admitted free.
Light-weight woollen piece goods are largely the product of the United Kingdom, and, as Britain is our greatest purchaser of Australian fine merino wool, the use of silk or artificial silk piece goods in place of woollen goods would mean the substitution of foreign fibres for Australian raw materials.
The Government recognizes that the woollen manufacturing industry in the Commonwealth is a very important one, and provides employment for a large number of persons. It may be said that the industry is efficient and competitive. The product’s manufactured are satisfactory, and in the lines in which there is sufficient demand the prices are competitive. The review made by the Tariff Board shows that under the protection granted by the 1921-30 rates, the industry commanded practically the whole of the trade in the heavier-weight fabrics. The importations of woollen piece goods in 1927- 28 were valued at £2,483,413; but an alteration of the item in 1928, in order to repair certain loopholes through which importers were defeating the object of the duties, resulted in importations during 1928- 29 falling to £1,448,105.
The Deputy Leader of the Opposition said that £8,000,000 odd worth of textiles were imported yearly into Australia, and one would infer from his remarks that they were coming in surreptitiously, or that their importation might be stopped by the applicationof proper duties. For the first eight months of this financial year, textiles to the sterling value of £8,700,804 were imported, but £7,647,000 was in respect to goods not made in Australia. These importations covered carpets, linoleums, and piece goods, such as canvas and duck-
– Linoleums are made in Australia.
Mr.WHITE. - Only on a small scale.
– They are made here on a large scale.
– Silk, linen and hessian are other lines not made here.
There is definite proof that the 1921-30 tariff rates were swinging the trade to the local mills long before the Scullin Government was heard of. As one honorable member remarked, the woollen textile industry was established before the days of federation.
– Long before protection was granted.
– No. Victoria was a protectionist country before the States federated. At Castlemaine and Geelong, the mills were turning out rugs and blankets comparable in quality with the best produced in any other part of the world. The reduction in the weight limit under sub-item f, 1 to 3 oz., has enabled the local industry to make further inroads into the market for the lighter-weight materials previously supplied by overseas manufacturers. The Government feels confident that the rates of duty proposed on woollen goods will enable local manufacturers to secure that proportion of the market for which economic production is possible, and at the same time will not impose an undue burden on the users of those classes of materials for which there is a small demand.
The cause of the unemployment that may take place in the industry on occasions has been explained by others; it may be due to changes in shifts ; building operations may cease, and there are frequent staff transferences between sections and factories. For instance, the Deputy Leader of the Opposition said that a mill in Geelong had not been employing a large number of men formerly engaged, and the honorable member for Darling (Mr. Blakeley) said that Bond’s mill had dismissed about 150 hands in the knitting section. I point out, however, that another mill not many miles distant from Bond’s - the Lustre Hosiery Works - is working shifts and putting on hands. The fact is that, in the textile industry as in others, management and efficiency must be taken into account. Transfers of labour should not be used as an opportunity to cast a stone at the Ottawa agreement. Generally speaking, unemployment in Australia has diminished, and it is a matter for regret that by a section of the press the Government’s policy should be condemned on unfair and misleading grounds. In conclusion, I would quote the words of the Tariff Board with regard to the future of this industry -
The future extension of the industry will depend, not upon securing still higher duties, but rather upon development in sufficient production in those cloths which can be produced most competitively, leading ultimately to the establishment ‘of a considerable export trade.
.- I desire to add my protest to that of the Minister regarding the statement made by the Deputy Leader of the Opposition (Mr. Forde) about importations of textiles. He claimed that the value of our importations ran into millions, and I am afraid that persons reading that statement in the press may be misled. It is well to remember that the import classification “ Textiles “ includes carpets, linoleums and other floor coverings, cosies, cushions, doyleys, handkerchiefs and serviettes, piece goods, hessian and other jute piece goods, lace for attire, goods of silk or containing silk, velvets, quilts, table covers and towels, &c. ‘ I remind the Deputy Leader of the Opposition that the committee is discussing item 105 f 1, which is strictly confined to woollen textiles over 3 oz. in weight. The value of the imports of woollen textiles under the item that we are discussing amounted in Australian currency to £59,000 for the year 1931-32, as against approximately £4,750,000, which was the value of the goods of local production. The imports were negligible no matter in what form the Deputy Leader of the Opposition presents them, in order to make them look formidable. At another stage the Deputy Leader of the Opposition chose the year 1928-29 in analysing the imports into this country. I chose the four years preceding the depression period, and averaged them at 75 per cent. But in the year 1928-29, 50 per cent, of the imports were of goods other than women’s wear. If the honorable member had chosen the year 1926-27, he would have found that only 5 per cent, and in 1927-28 only 10 per cent, of the goods imported were other than women’s light wear. In 1928-29, the total imports had gone down, and the imports of women’s light wear had dropped slightly more in proportion. I think that the fairer way to quote these figures would! be to average them during the four predepression years.
I listened with attention to the honorable member hoping that he would makesome retraction in respect of his statement regarding the Ottawa agreement having been responsible for the dismissal of a number of men from a certain mill at Geelong. I understand that he suggested that he had been misreported. If that is the case, it is due to the people of Geelong that the honorable member should say so specifically in this chamber.
– I said that 95 persons had been dismissed. Some of the newspapers opposed to protection said that that was not true, and I produced telegrams to show that it was true.
– According to the Canberra Times, the honorable member stated that “ 95 employees had been dismissed during the week as a result of tariff reductions following upon the Ottawa agreement.”
– That was quoted by the honorable member and others who wished to. misrepresent me.
– I have read a similar statement in the Geelong Advertiser. No newspaper is so solicitous of the welfare of the woollen textile industry as is the Geelong Advertiser. I should like the honorable gentleman to state whether he did or did not say that the Ottawa agreement was the cause of the dismissal of those men. If he did, I should be glad if he would support his statement with something more authoritative than a chance telephone conversation with a mill manager. Perhaps he considers that he has caused quite enough trouble, and done enough damage, by having made the statement. If that be so, I am content to allow the matter to drop.
The honorable member for Perth (Mr. Nairn) quoted something that I had said, in a way that led me to believe that he thought I had referred to local prices as being unduly high. I do not think that that is so. The reduction of the prices of Australian woollen textiles over the last three or four years has been progressive, and to-day it can be said that they are about 30 per cent, cheaper than they were three or four years ago. That in itself is sufficient to show that they are fairly reasonable. I have gone through typical price lists, and that is the view which I hold. I do not consider that the Australian public is being exploited in the manner suggested by certain honorable members from Western Australia.
I was considerably astonished when I heard the honorable member for Maribyrnong (Mr. Fenton) urge that the reports of the Tariff Board should be rather fuller than is now the case, and that’ they should contain more evidence on each side. I feel sure that the honorable member is aware that he can purchase in typescript the full text of the evidence given before the board. If the whole of the evidence were printed, the reports of the board would make bulky volumes, and be of little interest to honorable members. The gist of the evidence is selected and extracted, I think, fairly and without bias.
The honorable member for Gwydir (Mr. Abbott) referred to the consumption of wool in Australian mills in the year 1930-31. It so happens that that year was the lowest experienced in Australian woollen textile production for a period of nearly ten years.
– The exports of wool were high.
– That is quite understandable ; the season was a good one.
– The price was then much lower.
– But people cannot be made to buy woollen textiles when they have not the money to do so. Since that date, may I tell the honorable member for his comfort, the figures have risen by nearly 75 per cent.
The bogy of exchange approaching parity with sterling has been raised by several speakers. Personally, I cannot see that there is any danger in the situation. There is no hint of any return towards parity ; if anything, the prospects for the next twelve months are possibly in the other direction. I should hot be at all disturbed if sterling came back towards parity, because that very fact would indicate an early return to prosperity, which would mean a much greater purchasing power within Australia, and a larger consumption of woollen textiles than exists at the present time.
.- The honorable member for Corio (Mr. Casey), having repeated certain misrepresentations of my statements, I wish to point out that, in addressing a meeting at Ascot Vale, Melbourne, I informed my audience that that morning I had spoken to the manager of one of the largest woollen mills in Geelong, who had stated that 95 persons had been dismissed on the previous Saturday by an important mill in that city - not the mill of which he was the manager, but another. The representatives of certain newspapers immediately interviewed a number of mill managers, and published denials of the accuracy of my statement. I received several telegrams, one of which was sent by Mr. Schofield, the general manager of the Returned Soldiers Mill. It read as follows: -
My statement to Mr. Forde, that 95 persons had recently been dismissed from one of the local mills owing to a slackening off in trade, is absolutely correct. I understand this statement will be confirmed to you by wire from the manufacturer concerned.
The statement was confirmed by telegram by the manufacturer concerned, and it definitely supported the announcement that I had made at Ascot Vale.
– Did the honorable gentleman say that the Ottawa agreement was the cause of the dismissals?
– What I said in regard to Ottawa was identical with- what I said to-night - that twelve days after the conclusion of the Ottawa Conference the Acting Minister for Trade and Customs (Mr. Perkins) brought down a tariff schedule which reduced the duty on woollen piece goods, because the Government did not wish those reductions to be directly connected up with Ottawa in Parliament when a later schedule was brought down. I did not say that the dismissals at Geelong were the direct outcome, of Ottawa, although the reductions were made fourteen days after the Ottawa Conference concluded. “I referred to the uncertainty and instability that were caused by interference with the protectionist policy of the last Government, which gave these big manufacturers adequate protection. I said that those manufacturers were witnessing the spectacle of many items being referred to theTariff Board so as to make them conform to the terms of the Ottawa agreement, and that they did not know when the circumstances in their case would be reviewed. I also alleged that big retailers, such as those mentioned by the honorable member for Swan (Mr. Gregory) to-night, were already placing orders overseas for worsteds and light dress materials, and that Australian manufacturers were not getting the forward orders that they previously received. My statement that 95 men were dismissed at Geelong was absolutely correct, and it was substantiated by those concerned. The honorable member for Corio (Mr. Casey) - a freetrader at heart, who is masquerading as a protectionist - will receive his quietus in the Corio electorate at the next federal elections.
– I should not have risen a second time during this debate had it not been for the manner in which the Minister for Trade and Customs (Mr. White) dealt with the question that I asked him. The honorable gentleman carefully sidestepped and tried to evade the issue by a display of what I may call fustian oratory. He abused me and said that I had quoted from an old Year-Booh. It is the latest Year-Booh that a private member has the privilege of possessing. The honorable- member for Corio (Mr. Casey) courteously answered my question, which ,was asked with a genuine desire to learn whether the industries that we are protecting are really increasing their consumption of a local product. Private members have not at their disposal many avenues for obtaining information, and they look to the Minister in charge of such an important matter as the tariff schedule to enlighten them.
During the debate a certain amount of innuendo has been cast on the Country party; it has been referred to as a sectional party, and it is certainly sectional in this particular matter, because it carries the greater part of the burden and the worry of the people in the country, which at the present time are by no means small. May I also say that it is only the country people who are preventing Australia from collapsing, and that, consequently, it is essential that their position shall be studied from every angle. We are anxious to learn the full facts. I consider, therefore, that the Minister might have dealt with the matter in a more courteous fashion.
.- The honorable member may have a gentle voice, but his attacks are none the less subtle on that account. I furnished him with definite information which I am astonished that/ as a wool man, he did not possess. He cast a slur on an Australian secondary industry, and asked in what way the local wool-grower was being assisted. In 1926-27, he said, Australian mills used, 52,000,000 lb. of wool. I admit that those ‘ figures appear in the latest book to which he has access; but I thought that he would have read the reports of the wool companies, which contain later information. According to the honorable member, the weight of wool used in Australia in 1930-31 was 45,000,000 lb. This year the quantity is 250,000 bales, and the wool companies have paid a tribute to those who have purchased it for. having helped to raise the price. The honorable member knows better than I do the weight of a bale of wool. A simple arithmetical calculation will show him that the weight of 250,000 bales is 75,000,000 lb. That quantity, which is more than half as much again as was purchased in the year that he quoted, has been secured in the first eight months of this year. He accuses me of rudeness. It is nothing to the rudeness that is shown to me by some honorable members; but I am not worried by it, because I give the facts.
The honorable member for Corio (Mr. Casey) has asked whether the Government will watch carefully any dumping that may make the present foreign duties ineffective. The Industries Preservation Act empowers the Government to refer such a matter to the Tariff Board for a ruling; but should a quick judgment be necessary, the Government could so load an invoice as to bring the value to a reasonable figure. The trouble is caused by currency depreciation, and it is worldwide.
The honorable member for Corio also asked whether there might be additional classifications, in view of the large number of items produced by the woollen mills. If the manufacturers are able to suggest additional groupings, the matter will be considered.
Whatever the party views of honorable members may be, I ask thiem to attempt to co-operate in putting through what is a most comprehensive tariff. If it will not bring about fiscal peace, it will at least let industry know where it stands. Criticism of the carping kind, and attacks of a political or a personal nature, do not assist in the conduct of business. Let us get this immense schedule through as quickly as possible, so that the industrial and commercial community, and the man on the land, may know where they stand.
.- I do not consider that the Minister for Trade and Customs (Mr. White) was justified in-suggesting that the Country party is hostile to secondary industries. I recognize that this secondary industry, the manufacture of woollen textiles, is of great importance to Australia. It gets the best raw materials in the world at its very door, and at the lowest price in the world, and it ought to be successful. Recently I went through one of the Australian woollen mills, and was convinced that it is equipped with up-to-date machinery, and is efficiently conducted, and that throughout the workmanship is of the best. Any complaint of exploitation in regard to prices is not directed against the woollen mills. During my inspection I was careful to ask the prices of the different materials, of fingering wools, and of the cloth used in the various manufactured goods; and I found that compared with similar imported goods, there was not much to complain about. -But by the time these goods pass through the wholesale warehouses of York-street, and then through the retail warehouses and tailors’ establishments, a piece of first quality tweed which costs 8s. 3d. a yard at the woollen mills, or 26s. lOd. for a suit length, costs £1 15s. when made into a suit. The excessive charges added to the cost of the material after it leaves the woollen mills tend to reduce the consumption of wool in Australia. The Country party welcomes this small reduction of duties. It is not in favour of imposing duties higher than are necessary to protect even efficient industries. The woollen industry is safe at the proposed rates. They may seem high, but, while there is reasonable competition between the Australian mills and no exploitation of the public, we have not much reason to complain. The Country party is pleased that this secondary industry already employs 12,000 workers, and is expanding, and so long as efficient mills in Australia are in competition, and do not form themselves into combines in order to exploit the public, it does not complain of the industry being granted reasonable protection.
– It was pleasing to hear the honorable member for Riverina (Mr. Nock) admit that in this natural secondary industry of manufacturing woollen textiles there is an ever-present market for the wool grown by our primary producers. This is a highly technical industry, involving, .not only the weaving of the wool, but also its spinning, as well as various finishing processes. Those engaged in the trade are not greatly concerned with the reduced duties on suitings, but they are concerned with the duties on ladies’ dress materials, for this is a comparatively new departure in Australia. It is a phase of the work which requires a little more protection until greater efficiency has been obtained and the mills are better able to compete with the product of other countries. In matters of dress women are more fastidious than men. Their dress designs change more frequently. Great Britain and continental countries combine to establish fashions, but as we in Australia must more or less anticipate fashions we must have our own I. designers. The failure to realize this in the early days of the industry caused a reaction against the Australian material, because the manufacturers could not supply the desired range of patterns or variety of materials. Obviously, we have not the same market that our competitors have; but that we are. doing well in providing .a wide range of goods, the samples left in the Library by the honorable member for Corio (Mr. Casey) give ample evidence. Nevertheless, Australia still falls short of older countries in the range of goods available for selection. It is good to know that there is a prospect of an export trade in these goods, for an extension of the market should tend to widen the range of goods and to reduce prices. The demand for some classes of goods is limited ; the small quantities required necessitate the weaving, of special lengths. In the early stages ‘of the Australian industry the dyeing of the cloth was not all that could have been desired. Plain materials are generally dyed in the piece when they come off the loom. The dyeing process involves skill in order to obtain an even shade and the necessary finish. Our early efforts in those directions were not highly successful, due largely to the absence of the proper machinery and the necessary experience. Only recently I made representations to the Minister for Trade and Customs (Mr. White) in regard to the importation of certain machinery required for the dyeing of yarn for cotton piece goods. Dyed cotton yarn costs considerably more than dyed woollen yarn, chiefly because we have not the machinery or the demand necessary to produce it at the required cost. Until this branch of the industry becomes more effective, a higher protection is justified, as was the case in the early days of , the woollen industry. Protection given to this natural secondary industry will help not only one of our great primary industries, but other secondary industries as well.
– The outstanding feature of this debate is the laudatory speeches in regard to the woollen textile industry. I was glad to hear the honorable member for Riverina (Mr. Nock) say that it is a valuable secondary industry because of the assistance it renders to one of our great primary industries. The honorable member for Wentworth (Mr. E. J. Harrison) also had a good word to say for it. The honorable member for Corio (Mr. Casey) made an interesting speech, with ninetenths of which I heartily agree. The speeches which have been delivered during this debate have contained no word of complaint against the way in which the industry has been conducted. Speakers on both sides of the chamber have admitted that the materials used axe equal to the best imported material, that the prices charged are reasonable, that there is fair internal competition, as well as reasonable competition from overseas, and that the industry has not exploited the public. Yet many honorable members have concluded their speeches by saying that the duties, the imposition of which made it possible for the industry to detvelop, should now be reduced by one-half. Why are men, who by practical experience and searching examination have learned how this industry has developed without exploiting the public, prepared to risk injury to it by a reduction of duties ?
– Because the industry has grown beyond the need for such protection. .
– And we have to protect the consumer.
– Many honorable members are killing the industry with faint praise. I can imagine the average man in the street who is concerned about this industry reading carefully the speech of the honorable member for Corio and wondering why, after the high testimony he has paid to its efficiency and value, he is yet prepared to reduce one duty from 2s. to ls. and another duty from 3s. to 2s. Why should we unnecessarily run the risk of destroying the industry, or even checking its progress?
– Why continue the high duties if they are no longer necessary?
– The duties of 3s. and 2s., which operated for three years, produced those wonderful results to which the honorable member and others have testified. With that protection the industry has grown out of proportion to the development in other industries ; while the quality of materials has improved and the range of patterns has extended, prices hit Ve been reduced. There has been no suggestion that any danger might lie in the continuance of those helpful duties, yet honorable members are prepared to reduce them by one-half and one-third respectively. What will be the opinion of the people of those districts in which the mills are situated?
– They are perfectly sa tiisfied
– I know of no manufacturer, or worker in a woollen mill, whose bread and butter is at stake, who will be satisfied with the reduction of duties.
– In each case there is also an ad valorem duty.
– Which is lower than the ad valorem duty previously operating. The drastic reduction without justification of duties that have proved highly beneficial is nothing more or less than fiscal vandalism.
Sub-items, as amended, agreed to. Progress reported.
House adjourned at 10.17 p.m.
The following answers to questions were circulated: -
y asked the Minister for Trade and Customs, upon notice -
What industries, other than netting and matches, have been proclaimed under the Customs Tariff (Industries Preservation) Act?
– The following is a list of goods gazetted under sections of the Customs Tariff (Industries Preservation) Act 1921-1922, and operative on 26th April, 1933:-
y asked the Minister for Trade and Customs, upon notice -
Will he place upon the table of the House or’ of tho Library all papers relating to any correspondence between the Trade and Customs Department and the Tariff Board in connexion with the Tariff Board’s report on the match industry recently presented to Parliament?
– The communication referred to on page 10 of the board’s report, asking what rates of duty the board would have considered appropriate if the protection afforded by exchange and primage duty had not been taken into consideration, was a verbal one. The only letter in tho matter was alluded to in my speech on -the 5th April last when I said that the matter had been referred back to the board for further information as to costs, but the board was not prepared to reopen the case, and I therefore tabled the report.
Cite as: Australia, House of Representatives, Debates, 26 April 1933, viewed 22 October 2017, <http://historichansard.net/hofreps/1933/19330426_reps_13_138/>.