1st Parliament · 1st Session
The President took thechairit 10.30 a.m., and read prayers.
– I desire to ask the Vice-President of the Executive Council whether he will have prepared for the convenience of honorable senators a statement showing the revenue collected in Western Australia on the various items in the Tariff? The statement which was presented some time ago gave the figures for each State except Western Australia. We know that there has been a difficulty in getting the returns for that State, but in view of the time which has elapsed we might at least be supplied with the figures for the half-year. Will the honorableand learned gentleman also lay on the table a statement showing the collections under the various divisions of the Tariff in each State during April? I have obtained for my own use the figures from the Comptroller-General of Customs, and it is desirable that they should be made available to every honorable senator.
– Will the honorable senator give notice of his questions for the next sitting day ? .
Senator DRAKE laid upon the table_
Papers relating to Cobb and Co.’s contract for the conveyance of mails in Queensland.
In Commit lee (Consideration resumed from 5th J une, vide page 1 3350).
Division IV. - Agricultural products and groceries.
Item 40. -Rice, viz., Uncleaned, per cental, 3s.4d…… N.e.i., per cental (is.
Upon which Senator Sir Josiah Symon had moved -
That the House of Representativeshe requested to amend item 46 by adding to the duty “ Rice, viz., n.e.i., per cental, 6s.” the words “and on and after 1st July, 1902, 5s.”
– When Senator Symon moved this motion, with a view to increasing the revenue, he said that if the duty on the dressed rice is not reduced a larger quantity of undressed rice will be imported ; that, if the reduction is not made, the disparity between the 3s. 4d. per cental duty on the undressed rice and the duty on the dressed rice will be so great that, comparatively speaking, only a small quantity of dressed rice will be imported, and thus the States will lose a considerable amount of revenue. If his line of argument is correct, no State will suffer to a greater extent than will Queensland. So far as it is concerned, I very much regret that there has been any alteration in the duty. Queensland imposed a duty of1d. per lb. in 1888, with a view to compelling its coloured population to make a reasonable contribution towards the cost of government. It was stated last night by Senator Pearce that in 1899 they numbered 20,000, but according to the latest information I have been able to secure they number 24,000. I do not think that we had any Japanese in the State in 1888, but we had a considerable number of other coloured’ people. Their chief food is rice. They wear very little clothing, and it is of the cheapest possible description. They do not consume the articles which are used by the European population. They live entirely differently, and the only means by which we could obtain from them a reasonable contribution to the revenue was by imposing a duty on rice. It is nearly all cleaned rice that is imported into Queensland, Little or no undressed rice is imported. I believe that the only rice mill which we have in the State is in the Cairns district. The difference between the cost of dressed rice and the cost of undressed rice in the countries in which it is grown was so small that it would not pay the merchants to export undressed rice. The merchants of Queensland know very well what they are about, and if they had found that it would pay them to import undressed rice, and get it dressed in the State they would have done so. The rice duty is a very large revenue item in our State. In 1899 and 1900 we imported no less than 8,607,000 lbs. of dressed rice, namely, 16,000 lbs. from the “United Kingdom, 403,000 lbs. from New South Wales, 115,000 lbs. from Victoria, 9,000 lbs. from South Australia, 3,813,000 lbs. from Hong Kong, 174,000 lbs. from the Straits Settlements, only 77,000 lbs. from India, 1,777,000 lbs. from Japan, and 2,220,000 lbs. from China. Senator Symon says that if we have the smaller duty on undressed rice, and the larger duty on dressed rice, very little dressed rice will be imported, and the result will be that we shall lose revenue. 1 dispute that statement. If his line of argument is correct, it proves that the merchants of Hong Kong, Japan, China, and India do not know how to conduct their business. When an Australian merchant asks a foreign merchant to supply a certain quantity of rice the price is fixed in such a way that it does not pay the Australian merchant to import undressed rice.
– But it does pay them now.
– Only a limited quantityis imported. Very little undressed rice is imported into New South Wales, and none at all into Queensland. I venture to say that if the duties are fixed by the two Houses in such a way as to bring in revenue to the different States, and at the same time to have the rice imported in a dressed condition, it will be very much better for the whole of the Commonwealth. So far as I am concerned I cannot support Senator Symon’s proposal, believing that his argument is not sufficiently strong when he says that rice is likely to be imported in large quantities in an undressed condition.
– What then is the object of keeping up this highly protective duty, except to diminish the importation of dressed rice?
– If the honorable senator thinks that that islikely to be the effect, why does not he agree to increase the duty on both dressed and undressed rice ?
– How about the encouragement of rice - growing in Northern Australia ?
– We certainly did grow some rice in Northern Queensland under a duty of1d. per lb. I am sorry to say, however, that the industry has not grown to any great extent. We have only about 300 acres under vice, and the annual production is about 6,500 bushels. I believe that Senator Symon’s ‘ proposal is utterly wrong. If we desire to obtain revenue for the different States - and goodness knows some of the States require revenue - it is our duty to increase the duty on both dressed and undressed rice.
– In the same ratio?
– We made no difference in Queensland, and I should like to see a duty of1d. per lb. all round.
– I confess that up till now I havenot made up ray mind bow I am going to vote on this question. I do not regard the subject from the free-trade or protectionist points of view ; I look upon it simplyfrom the revenue aspect, and I intend to vote for that duty which will bring in the most revenue. The smaller States, my own State of South Australia included, are urgently in need of at least the same amount of revenue from Customs as has been received in the past. We must always have this consideration before us - that the main object of a Tariff is to produce revenue. If we can secure a duty of 6s. I am going to vote for the item as printed ; but if we cannot get a duty of 6s. I would sooner have one of 5s. than one of 3s. 4d. That is the aspect which the question bears to my mind. I am not yet satisfied that cleaned rice will not be imported, and that we shall not get the 6s. per cental. Some figures were quoted by Senator Symon, earlier in the debate, in which he stated that the difference in price in Japan, free on board, between undressed and dressed rice is £2 10s. per ton. If that be so, the conclusion which I draw from the figures - and which I think anybody must draw - is that, taking into consideration the loss in freight, wages, interest on capital, and a fair return to the cleaner, if it costs £2 10s. per ton in Japan, where labour is cheaper than it is here, to clean rice, it should cost at least £2 10s. to clean rice here. If that be so, then cleaned rice will be imported and we shall get the 6s. duty. If my conclusions from Senator Symon’s figures are correct, I shall vote foi- the item as it stands ; but T understand that further information will be given to the committee by people who know, and who are able to tell us what is the price of cleaning rice in these States.
– It is 30s. per ton.
– I, cannot understand ‘why it should cost £2 10s. a ton to clean rice in Japan and 30s. a ton to clean it in Australia ; unless it be that there is machinery in use in Australia which is not employed in Japan. I should like to have further information before I make up my mind how I shall vote, but certainly’ I ain going to vote so as to obtain the largest amount of revenue.
– The facts which should lead us to a right conclusion on this matter lie, I think, within a comparatively small compass, and are such as can be easily grasped. There is no occasion to follow honorable senators into long disquisitions as to the number of Chinese employed in the rice industry and the consumption per head in the various countries to which importations take place. The one great factor is this : We have a proposition made in the Tariff for duties of 3s. 4d. and 6s. per cental. For the purpose of exact comparison, we should name the figures as 4s. and 6s., because 3s. 4d. on uncleaned rice is equivalent to 4s. on cleaned. Senator O’Connor stated that fact, and I agree with him. The rice that is imported in the uncleaned state at 3s. id. per cental pays a duty which, is equivalent to is. on the same weight of cleaned rice. Therefore what we have to consider is the difference between 4s. and 6s.. As it happens, this is one of the duties that have ruled in Victoria for some time past, and I should like honorable senators to note carefully the figures given in the “Victorian Statistical Register. In the year 1900, 26,000 centals of dressed rice paid duty at 6s., bringing in a revenue of about £8,000 ; but twice that quantity, or 52,000 centals, paid duty at 4s., bringing in only about £10,000. So that the one State of Victoria lost £6,000” in 1900 by the system of dressing .rice in bond. What is now proposed practically is that the whole of Australia shall adopt the system which in Victoria produced that result. Suppose that Australia consumes, as I believe she does, between 15,000 and 20,000 tons of rice per annum, the question is : Are we willing to have that rice imported in an undressed state, and to pay the people who clean it £2 per ton, or from £30,000 to £40,000 for cleaning it? Are we to take £30,000 to £40,000 out of the pockets of the people, and transfer this gigantic sum to the pockets of the few who clean rice 1 Take the case of Queensland, to which Senator Glassey has directed attention. Queensland received from rice £32,000, at. the rate of 8s. 4d. per cental. That duty was charged upon all rice imported, whether cleaned or uncleaned, and, of course, only cleaned rice was imported. If the same consumption went on and the” duty had been reduced to 6s. per cental, the Queensland Treasury would have received about £24,000. But if we introduce a system which encourages people to import uncleaned rice, with a view to making a. profit on the cleaning, Queensland will receive only about £16,000. The proposition made by Senator Symon is that the duty on cleaned rice shall be os., with the view of not discouraging the importation of cleaned rice to the extent of the Tariff proposals. If a duty of 5s. is imposed, and the great bulk of the rice imported into Queensland is cleaned, under the 5s. rate Queensland will get £20,000 ; whereas if importers are encouraged to bring in uncleaned rice, the amount that will go into the Queensland revenue will be only £16,000. It is therefore quite clear that the loss of revenue involved is very substantial, and that the only way of checking it is by reducing the large margin of £2 per ton, which, in regard to the consumption of all Australia, amounts, as I have said, to something between £30,000 and £40,000. There is another matter reference to which will assist our judgment. We have an analogous system in connexion with the refining of sugar. Under the Tariff we have a duty of £6 per ton on sugar, but the sugar refiners are allowed to bring in the raw sugar, refine it in bond, and pay the duty of £6 per ton on the quantity refined. That is fair. It would be fair in this case if we had only one duty of 6s. on cleaned rice, knocked out of the Tariff altogether the duty of 3s. 4d. upon uncleaned rice, and allowed the importers to bring in uncleaned rice, clean it, and pay a duty of 6s. on the quantity cleaned. That would be analogous to the system which prevails in regard to sugar. Then the revenue would get the whole benefit of the 6s. per cental on the consumption of Australia. Why have we departed from that system in regard to rice? Why are we going to throw away at least one-third of the revenue which the people who consume rice will have to pay, in order that we may provide a small amount of employment in which only a trifling proportion of the £30,000 or £40,000 of revenue which will be lost will go in wages ? That is the question in a nutshell.
– The actual collections show that Senator Pulsford is absolutely wrong in his prediction as to what Queensland will obtain, and, if the committee will follow me for a moment, I shall be able to establish that statement conclusively. The duty that was in force during the early part of the operation of this Tariff, before reductions were made, was 5s. 3d. on uncleaned rice, and 8s. 4d. on cleaned rice. There was thus a difference of 3s.1d. between the two duties. Up to the time that the alteration was made in this Tariff both duties were higher, and the margin was also larger; but as they now stand the difference between the two duties is 2s.8d. Let us look at the resultsof the actual collections, when the difference was 3s.1d. and when, if my honorable friend’s argument is right, it would have been much more difficult to obtain dressed than undressed rice here. The alteration made in the Tariff dates from the 26th March last, and during the six months ending 31st March last £39,639 was collected. Itmay be taken that, roughly speaking, this collection was made under the 3s.1d. margin, and under a much heavier impost against dressed rice than that relating to the undressed article. I have stated already that in New South Wales there was obviously an under importation, because during that period only £2,240 was collected there. We know that there is no rice-cleaning industry there, so that all the rice which was imported into that State must have been . dressed in the ordinary way. During the same periodduty amounting to £15,566 was collected in Victoria, so that there must have been a loss of about £12,000 in New South Wales occasioned by loading up. In Queensland a sum of £17,135 was col lected.
– That is about the same as the revenue of 1899.
– The revenue which Queensland obtained from this source in 1899 amounted to £37,419, so that the amount collected during the six months I have named would be very much the same as that received under the State Tariff. In South Australia £1,320 was collected, and in Tasmania £1,378, while the approximation for Western Australia is £2,000. It must’ be remembered that during that period rice required for the purpose of making starch was free of duty, and that therefore no deduction is to be made from these figures.
– Do the figures discriminate between dressed and undressed rice ?
– That is the whole point.
– It is not. Senator Pulsford has been endeavouring to point out that we lose revenue upon the whole. We obtain our revenue from the total collections on dressed and undressed rice, and I am showing that with a higher duty and with a larger margin the revenue derived during the six months named amounted to £39,639, while the revenue raised in Queensland was in proportion to that collected during 1899 under the State duty, which was 8s. 4d. per cental.
– The freight from Melbourne to Queensland would be almost as much as from China to Queensland.
– The honorable senator has furnishedme with a strong argument against himself. If the freight from Sydney or Melbourne to Queensland is very much the same as from China to Queensland, what is the object of getting rice dressed here instead of rice dressed in China? What is the explanation of the large collection which has been made in Queensland ? It is a well-known fact that the Chinese very much prefer the dressed rice which comes from China to rice which is dressed locally. That is not only a matter of sentiment, but one of business. The Chinese deal with Chinese firms, who, in turn, deal with their own country, and, in that way, a stream of trade is started with which it is very hard to interfere. That is why there will always be a large quantity of dressed rice coming here. Whatever we do in the way of creating rice-cleaning establishments we shall find that the great bulk of rice consumed by the Chinese will continue to come from China or Japan ready dressed. Another illustration can be given of what takes place under a duty such as we have described. If we turn to the Statistical Register of Victoria for 1900 we find that during that year the quantity of dressed rice which came into Victoria amounted to 134,601 centals. The importations comprised 392 centals from New South Wales, 129 centals from New Zealand, 280 centals from Queensland, 39 centals from South Australia, 43,680 centals from Burmah, 18,54-9 centals from Hong Kong, 16,780 centals from Bengal, 39 centals from Ceylon, 3,653centals from Japan, and 51,060 centals from the Straits Settlements. It is clear that a portion of the rice imported during that year into Victoria was re-exported, and that a portion of it was also used for starch-making purposes, but what I am concerned with now is the total quantity of dressed and undressed rice imported into, Victoria. The total quantity of rice which was imported in its rough state into Victoria during that year, and dressed in bond, was 58,327 centals, comprising 6,630 centals from Burmah, 1,075 centals from Hong Kong, and 50,622 centals from Japan. All these importations took place under a duty of 6s. per cental on dressed, and 4s. per cental upon undressed rice, the difference between the two duties being the same as that under this Tariff.
– Under the Federal Tariff the difference between the two is 2s. 8d.
SenatorO’CONNOR-. - It amounts really to the same thing. A duty of 4s. per cental is paid upon the resultant. A duty of 3s. 4d. is paid upon the total quantity imported, and 17 per cent. is lost in the process of dressing. The figures I have quoted show that 134,601 centals of dressed and 58,327 centals of undressed rice were imported into Victoria in 1900, and whether the dressed rice was applied to starch making or ordinary domestic use the same argument applies. If the protection here was so large that it would not pay to send in the foreign dressed rice it would not have been sent in. But we find that the foreign dressed rice was imported in large quantities. The duty paid in Victoria simply indicates the importation either for the purpose of dressing in bond or for consumption in this State. During the year named duty was paid on 26,814 centals of dressed rice, those figures showing that the difference between that quantity and the large importations I have mentioned was re-exported. If we were seeking to separate the quantity which came into Victoria and was consumed here and in other States, that would be an element to consider, but I am dealing simply with the quantity of dressed and undressed rice which came into this distributing centre. The amount which was dressed in bond was 52,083 centals, and the same explanation applies to that. These figures contradict in the plainest possible way the argument of my honorable and learned friend opposite, that Queensland and other -States will be at a loss. As a matter of fact, it is shown that Queensland has not been at a loss, but has collected what she collected before, and in Victoria the collections for the year before this have been what I explained, and under an exactly similar duty. Perhaps the explanation may be found in the figures I am now about to quote as to the cost of rice cleaned and uncleaned in other countries. I have had very careful inquiries made as to the present price of cleaned and uncleaned rice in Japanese ports. I have not been able to get the prices for other ports exporting rice, but I find that at Japanese ports to-day the price of uncleaned rice, f.o.b., is £.11 5s. per ton, and the price of cleaned rice, f.o.b., £13 5s. That is a difference of £2 per ton, and the difference in the figures quoted yesterday by Senator Symon, was, I think, from £2 5s. to £2 15s. In accounting for the difference in price, I presume there would be the loss of 1 7 per cent. there as well as here in. the cleaning of the rice, and in addition to that, there is the cost of the labour employed in the cleaning. It must be eviden t that the question really turns upon the cost of labour, because the loss is absolutely the same in both countries. When we remember how cheap labour is in Japan, and in the other countries where rice is grown, and that in the case of Japan particularly their machinery and chemical appliances and their engineering skill is quite up to the level of any European country, and will probably be quite up to the level of our own factories, it must be seen at once that there can be no doubt that, whenever the Japanese desire to capture the Australian market, or to increase their hold upon it, they -will be able to produce and sell the finished article at an infinitely lower price than that at present quoted. The margin is the same for them as for us, and we can understand that the difference in the cost of labour will always be so great as to very much more than compensate for the difference in the duty. In Japan labour is subject, practically, to no conditions, and it can be got at any price. Here labour has not only a certain market value, but its employment is surrounded with a number of conditions for the benefit and comfort of the workmen, which do not obtain in Japan and which, of course, go to increase the cost. These conditions surrounding the employment of labour are not likely to diminish as time goes on. Under all the circumstances, and coining down to the bare fact of revenue - and I am dealing with that now - I think I have shown that the foreign exportation of dressed rice will not be lessened. Chinese and Japanese dressed rice will come in here to the Chinese and other people who require it, and it can be imported at a lower price than that at which we can possibly produce it even with protection. That is proved by the experience of Victoria with a similar duty in 1900, and by the experience of the Commonwealth for the six months in which a higher duty and a higher margin have been in force. I have taken some time to put the facts of the case before the committee, because T regard this as a most important question from the point of view of revenue, as well as of protection.
– From the point of view of revenue, the honorable and learned senator might increase the duties all round
– The honorable and learned senator will see that the margin of difference between the duties has not been arrived at without great consideration.
– I am not speaking of the ‘margin.
– The duty upon uncleaned rice has been agreed to. I point out that the whole matter has been very fully considered It was postponed for further consideration in another place, and my honorable colleague, Sir George Turner, having in view, as he has had all along, the necessity of providing as much revenue as possible for sill the. States particularly interested in a matter of this kind, came to the conclusion that the best way to get revenue and at the same time give a reasonable amount of protection was to adopt the duties and the margin between them which are shown in the Tariff. I hope the committee will see that it would be a very serious matter indeed to interfere with the revenue by altering these rates.
– As Senator O’Connor has said,, this is a matter of very great importance, and it justifies the care the honorable and learned senator has taken in order to supply as much additional information as possible. I am sure I am expressing the views of thecommittee when I say we are indebted tohim, as we shall be to any one else who may supply us with information which will guideus to a right conclusion upon the matterIt is because of its great importance, and. because of the additional figures to which, our attention has been called, and because,, also, of the exceedingly interesting and important view of the matter which SenatorBaker has presented, that I desire to say one or two words. We have passed the duty of 3s. 4d. upon uncleaned rice, and Senator O’Connor defends this duty of 6s. upon cleaned rice merely on the ground of protection. If we do not impose this duty, the honorable and learned senator says we shall allow Japan now and in the future to capture the markets of Australia for dressed rice. That means that in the contemplation of the G oven lament this duty is intended, not, perhaps, at once, but gradually, to destroy the importations of dressed rice, in order to destroy the possibility of Japan capturing the markets, of Australia for the article. In bringing about that result - and I do not say whether - it is wise or not - we shall be destroying, the revenue we derive from the importation of dressed rice, and we shall thus be reducing the duty at one swoop by 2s.. Hd. per cental. That is Senator 0’Connor’s.argument without elaboration. The honorable and learned senator’s policy upon this item is to prevent the introduction of Japanese dressed rice into Australia by imposing a dutv of 6s. per cental, and to encourage the importation of the undressed article by making the duty upon it something like half that amount. If that is done, as certainly as the sun rose this morning the result will be to diminish the revenue by 50 per cent. Nothing could be more forcible than the observations the honorable and learned senator made as to the necessity of our viewing this matter with the greatest care from the point of view of revenue. The point of view from which I look at it is mainly that of revenue. It is for those who think that the protection afforded by the duty proposed by the Government is not too high to show that the protection of1s. per cental, which I am willing to allow by the motionI propose, is not sufficient, without destroying the importation of the dressed article, to give a fair encouragement to those who choose to pursue the avocation of dressing rice here.
– Why not encourage the growing of it as well as the dressing of it?
– I am obliged to the honorable senator for that interjection, because it enables me to say that if we raised the duty upon uncleaned rice from 3s. 4d. to 4s. or 5s. we should be immediately asked to raise the duty of 6s. upon cleaned rice to some higher amount.
– We need not do it.
– My honorable friend must see that theonly question at issue is the amount of the margin necessary to give a reasonable protection, and at the same time to produce revenue. We need revenue. We know that the smaller States are not able to compete in these small industries of packing and cleaning goods with the larger States. The duty which was imposed in South Australia was 3s. per cwt., which is a little less than 3s. per cental, and that State can have no cause to complain when this Parliament, if my motion is agreed to, offers it 2s. per cental more than it has been in the habit of getting upon dressed or undressed rice. We know that in Western Australia, where there is a great consumption of rice, the article is free. I do not need to elaborate these statements ; it is better to leave the facts to speak for themselves. The Government object to the importation of dressed rice on the ground that it will lead to the early capture of the Australian market by Japan ; and the object of the duty of 6s. is to prevent that capture, and. therefore, gradually reduce the revenue from dressed rice by 50 per cent. We were told last night that Western Australia is the greatest consumer of rice, with 21 lbs. per head per annum.
– That is according to the figures given in Coghlan, but those figures are incorrect.
– I prefer for the moment to accept the figures of Coghlan, and also the figures which, in connexion with the cost of cleaning, were given on the authority of Mr. Watson, the leader of the labour party in this Parliament, who certainly cannot be described as a freetrader. W estern Australia, with the smallest proportion of Chinese residents; is the largest consumer of rice in the Commonwealth. Senator O’Connor said that the importation of dressed rice would continue, because a large number of Chinese prefer rice dressed in their own country; and, undoubtedly, if the consumption of rice imported ready dressed be encouraged by a duty of 5s., the revenue will be enormous in Western Australia. The same remark may be made of Tasmania, and, for the matter of that, of Queensland. In the face of these facts, the whole structure which Senator O’Connor has reared up, on the assumption that the consumption of rice isby the Chinese, crumbles to pieces. The consumption is not by Chinese, butby people of our own race and colour ; and if we prohibit, or partially prohibit, theimportation of dressed rice, we shall discourage the use of this commodity by them without any hope of making up the loss by means of the Chinese consumption. What kind of rice will be imported into Victoria if this high protective duty be continued ? Undoubtedly the und ressed article. This point was skimmed over by Senator O’Connor, as though he were skating on very thin ice. He told us that the total importation of dressed rice into Victoria was 134,601 centals. But what passes th rough the port of Melbourne does not concern us ; what we want to arrive at is the quantity of rice on [which duty is paid.I find that out of this 134,601 centals, only 26,814 centals paid the duty of 6s. for home consumption.
– Because the rest was re-exported.
– Any child in an elementary school would know that. A large quantity of rice may be sent to Victoria and re-exported to Western Australia or Timbuctoo ; but we want to know the quantity on which duty was paid, and the relative importations of dressed and undressed rice.
– What was the quantity of undressed rice imported for home consumption ?
– Just twice as much as that of the dressed rice, namely, 52,000 centals. Is that not a revelation 1 We find that the importation ‘ of dressed rice is going down while the importation of undressed rice is going up ; and that will continue. If we are so foolish as to impose a duty of 6s., there is not a man in this trade in Victoria who will not immediately enlarge his buildings and increase his plant. With a duty of 4s., twice as much undressed rice as dressed rice was imported; and undoubtedly, with a reduction of Sd., the quantity of undressed rice will gradually increase. If it does not increase, the whole object of the duty of 6s., which is to prevent the Japanese from capturing the Australian rice market, will be defeated. I believe the figures given to me to be correct, namely, that undressed rice is worth from £7 1 5s. to £8 los. per ton, free on board, in Japan, and dressed rice, £10 10s. to £11 per ton. I am sorry if I created the impression that the difference in the price is entirely due to the cost of cleaning, because we must have regard to the fact that, rightly or wrongly, merchants, in accordance with common custom, add something to that cost in dealing with their customers. Admitting, however, that the whole difference represents the cost of cleaning - though I do this under protest, regarding the allowance as ridiculous - I contend that the importer who dresses the rice and pockets the profit has an advantage of £2 10s. clear on every ton. Taking the imported dressed article, the cost is £11 per ton, f.o.b. in Japan, freight and charges £2 per ton - that is from 13s. to 15s. higher than the actual quotations which I have, and which are from 25s. to 27s. 6d. per ton - and duty £6 15s., per ton, making a total cost of £1 9 1 5s. The highest price of the undressed article is £8 10s. pelton - it really ought to be from £7 15s. to £8 per ton - freight and charges £2, cost of dressing £3, which is 10s. more than my difference; and duty £3 15s. per ton on the basis of 3s. 4d. per cental, making a total of £17 5s., leaving an advantage of £2 10s. per ton in favour of the locally dressed article. If you take Senator O’Connor’s figures, £13 5s. for the imported dressed article, and £11 5s. for the undressed article, f.o.b. in Japan, it- makes a difference in the details, but it works out exactly the same. The position is, I think, perfectly obvious. ‘After allowing the cost of dressing, at the most extravagant rates possible, are we going to put £2 10s. per ton clear into the pocket of the gentleman here who puts the rice through the cleaning process t Finally I wish to call attention to the most valuable information given to us last night by Senator Pearce. Mr. Watson, the able and experienced leader of the labour party in the other House, states that the actual labour cost of dressing in Australia, as ascertained from the factories, is only 15s. per ton, and that ls. per cental, which is equal to £1 per ton, is ample margin. The more we encourage the importation of the dressed article the more revenue we shall get, and surely it is no argument to be addressed to us on this point to say that we should give up this duty to shut out the dressed Japanese article lest the Japanese should capture the rice market of Australia 1
– My honorable and learned colleague gave the general results of the collections in Queensland, and compared them with the revenue receipts in 1S99. I wish to give the actual collections since the Tariff has been imposed, bearing in mind that these are the collections under a margin of 3s. Id. per cental.
– Does the Minister suppose the margin would take effect in the six months ?
– It is during the next two or three years that the pinch will be most felt in the States, and it is more important to consider what is going to be the effect of the Tariff from the revenue point of view during that period than during any subsequent one. In Queensland there was collected in November £2,851 4s. 5d., in December £2,936 19s. 9id., in January £3,585 16s. 10d., and in February £2,666 8s. Id., or for the four months a total of £12,040 93. Hd. The receipts for the twelve months at the same rate were estimated to be £36,121 7s. 4id., which is practically the same as the revenue we derived in 1899 under a duty of Id. per lb. on rice dressed or undressed, and about £4,000 more than the receipts in 1900, which reached £32,6S1 3s. lOd. Had the collection of the duty on that basis been continued we should receive as much revenue this year as we received during the years when our revenue was at the highest point. But the duty on both dressed and undressed rice was cut down in another place. I am very sorry that the margin was reduced from 3s. Id. per cental, not to 2s. Sd., as stated by Senator Symon, but to 2s., as it has been in Victoria. I should have been very well satisfied if the duty on undressed rice had been kept up. I should have liked to see it kept up for protective purposes, because we are quite capable of growing any quantity of rice in Queensland, and we are growing a small quantity now. If rice is- grown there it will be dressed there beyond a doubt, but, of course, when that event takes place, we must expect a falling-off in the revenue unless it is derived by means of an excise duty. Senator Symon is incorrect in stating that there is a margin of 2s. Sd. per cental, and that the cleaners in Victoria are going to get a protection of Sd. per cental more than they enjoyed previously. In Victoria the duty has always been collected on the resultant after the process of cleaning ; so that although it was put clown at 4s. per cental in the Tariff it was exactly equivalent to the duty of 3s. -Id. per cental which is proposed in this Tariff. For fifteen to twenty years there has been a protective margin of 2s. per cental in Victoria. Senator Symon made agreatdeal of the figures he quoted, but what do they show? Clearly they show that with a margin of 2s. per cental - the same as is proposed in this Tariff - a considerable quantity of dressed rice was imported into Victoria, and that there is not the slightest probability that the result of the imposition of the proposed duty will be to scop the importation of dressed rice, and bring about immediately the introduction of undressed rice with the view of its being dressed here.
– Senator Drake said last night that it would stop importation and give protection.
– .That was the other Senator Drake.
– I certainly did not use that argument. Of course, I know what the effect of a duty of this kind will be in the course of time. The reason for its imposition is in order that the rice may be dressed here, but I know very well that that result is not coining about at once.
– I did not say so. I said it “would come about gradually.
– The honorable and learned senator led us to believe that we were going at once to lose revenue by this system. Ultimately that may take place, as it has to a certain extent in Victoria, but for the next few years we shall be getting the revenue as we have done before on the importation of dressed rice. What has been the result of this protective duty in Victoria for fifteen to twenty years? For consumption in the State there were imported 26,000 centals of dressed rice, as against 52,000 centals of undressed rice, which represents not only rice to be dressed in bond for the market, but also rice to be manufactured into starch.
– The rice used for manufacturing starch is not dressed in bond.
– Then where is the undressed rice used for the manufacture of starch included ?
– It is included in the 134,000 centals, and it comes in free.
– It comes in as dressed rice.
– According to the return which was quoted by Senator Symon the quantity of rice dressed in bond which paid duty was only 52,083 centals, while the total imports of all other rice amounted to 134,601 centals.
– That includes the rice for manufacturing starch.
– If the effect of a protective duty in Victoria for fifteen to twenty years has not been to cause the rice-dressing industry to be carried on to such an extent as to stop the importation of the dressed rice paying the higher rate of duty, what reason have we to suppose that for the next few years, or for a considerable number of years, there will be any diminution of the revenue in consequence of undressed rice being brought into the Commonwealth to be dressed here? I want now to point out to Senator Pearce where the inaccuracy occurs in the statement he has made in contradiction of mine with regard to the consumption of rice in Western Australia. If the honorable senator will look at Coghlan again, and compare the returns given with the results of the census of 1901, he will see that the population was under-estimated by Coghlan for the year 1899, and that the under-estimate makes the difference between the figures quoted by me and those quoted by Senator Pearce. The population given by Coghlan for 1899 was 177,030. The population of the following year, 1900, as disclosed by the census of 1901, was 188,553. In all the States estimates of population have to made according to the birth and death rates, and the immigration and emigration rates. These estimates have to be corrected by the census returns ; and in Western Australia I believe it is a fact that, during several years preceding the census, the population was very much underestimated. The consumption of rice in 1900, when the population was 188,553, amounts to 16-j lbs. per head, and I think it is reasonable to suppose that in 1899 there was the same inaccuracy as regards the population returns as in 1 900. Perhaps the matter is not of very great importance, but I mention it to explain the reason for the discrepancy between the figures quoted by me and those quoted from Coghlan bv Senator Pearce. With regard to the consumption of rice by the coloured population, it is perfectly justifiable that, when these people come here, take wealth from the country, and contribute scarcely anything to the taxation, we should make some effort to get at them. What lies at the bottom of the fallacies contained in many of the statements that have been made is that it is necessary to make an allowance for the loss of rice in the process of cleaning. That loss is represented in the difference of Sd. between the two duties. Many honorable senators who have spoken have left that factor entirely out of the calculation. But it is a factor which makes the difference in price between uncleaned and cleaned rice as imported from Japan. The figures Senator Symon gave us showed a difference in value of from £2’ 5s. to £2 15s. That is not explained by the cost of labour in cleaning in Japan, but it is explained by the loss of weight in the cleaning of the article. The rice loses in cleaning 17 per cent., which amounts to Sd. in 4s. So that 100 lbs. of cleaned rice represent 117 lbs. of uncleaned. This represents a loss of £1 1 Ss. 3d. per ton.
– If the loss is £1 1 8s. 3d., there is no margin whatever for cleaning.
– Yes, there is a margin due to the cheap labour of the countries from which this rice comes that is probably sufficient to account for the difference between the cost of cleaning in blacklabour and in white-labour countries. That is why dressed rice commands a higher price than undressed rice out of proportion to the cost of labour involved in the cleaning. Coming back to the question of revenue, it has not been taken into account that, in importing undressed rice at the lower rate of duty of -3s. 4d. per cental, the importer has to import a larger amount to produce an equivalent quantity of dressed rice. That fact has been lost sight of in the calculations made in regard to the results of the duty. Over and over again the 17 per cent, has been considered as representing the difference of 8d. in the duty. But it must also be remembered that in importing raw material it is necessary to import much more to produce a given amount of the cleaned article, and that consequently a larger amount of duty at 3s. 4d. per cental will have to be paid. Consequently, when it happens that uncleaned rice is more extensively imported into Australia than is the case now, we shall not lose the amount of duty that has been anticipated. In the meantime, during the next few years, it is absolutely certain that the bulk of our rice will be imported dressed. The duty on undressed rice has been passed. I wish it had been higher. But, it having been passed, no possible good can now be done by reducing the duty on dressed rice, because for years to come nearly all the rice which is imported must be dressed, and by reducing the duty from 6s. to 5s. we shall simply be throwing away revenue.
– The position taken up by the Vice-President of the Executive Council and that of Senator Drake are quite inconsistent. Their arguments are mutually destructive. Senator Drake has said that the object of the difference bet-ween the two duties is for protective purposes only.
– I did not use the word “object.”
– I made a note of Senator Drake’s language - that the intention of the Government in making the distinction between the rates of duty was to i encourage the industry of cleaning rice in
Australia. If the object. is to encourage and protect such an industry, then in proportion as rice is cleaned here the amount of imported cleaned rice is reduced, and in the same proportion the revenue is decreased. It is impossible to have the industry of cleaning rice here, and at the same time obtain the same importation of the cleaned article. Rice is not an article which we produce to any great extent in Australia. The protection contemplated by the PostmasterGeneral is not a protection to the producer but to the cleaner. I should like to draw Senator Baker’s attention to the figures quoted by Senator Symon, showing that the effect of this differential duty is to increase the quantity of uncleaned rice imported into Australia.
– That is the point at issue.
– Senator Symon shows by his figures that the quantity of uncleaned rice which has been imported into Victoria is twice that of cleaned rice. In Victoria there has been a difference between the duties on cleaned and uncleaned rice, but in Queensland, where there has been no difference, no uncleaned rice has been imported. Therefore, it is manifest that, from the point of view of revenue, the less distinction we have between the two, the greater will be the quantity of cleaned rice imported. I do not think it is worth while to deal with Senator Drake’s remarks in reference to the feeding of the black population of Queensland, because I cannot conceive that a Government who were desirous of obtaining cheap labour, and who imported coloured people for the purpose, would attempt to increase by taxation the cost of keeping those individuals. The point is whether we are going to diminish the quantity of cleaned rice imported into Australia by the imposition of this differential duty. I submit that the statistics of the various States show conclusively that the effect will be that suggested by Senator Symon.
– For once we may congratulate the Postmaster-General upon having solved something, because there can be no doubt that the difference of £2 between the cleaned and uncleaned rice of Japan arises from the loss of weight in cleaning. But I cannot go any further in congratulating the honorable and learned senator. He rehearsed a very interesting set of figures, showing the receipts which
Queensland has obtained from this source, but he failed to give us the returns for April. The duties on rice were reduced on the 26th March, the duty on cleaned rice being reduced in greater proportion than the duty on uncleaned rice, and if there is anything in the contention that a reduction of the duty would lower the revenue received we should naturally expect to find a decrease in the revenue derived from this source during April, as compared with the returns for March. We find, however, that the returns for March amounted to £2,194, while in April, £3,363 was collected, showing conclusively that the effect of reducing the duties has been to increase the importations.
– No ; the honorable senator will see a similar difference between the returns for December and January. The returns fluctuate.
– Taking the revenue for the Commonwealth we find that the duties on rice yielded £5,316 in February, and £6,062 in March, while in April - after the reduction had been made - there was an astonishing jump to £10,000. I would appeal to honorable senators not to insist that a reduction of duty will lead to a reduction of revenue, because it is perfectly clear that the reduction now proposed should have a tendency to further increase the importations of the more expensive class of rice.
Senator MILLEN (New South Wales).The Postmaster-General concluded his address by stating that it was obvious that for many years to come the bulk of the rice imported into Australia would be dressed rice. I would point out that the logic of facts is altogether against him. He was careful to deal with the figures relating to Queensland, where there has never been a differential duty, and he pointed out that there was practically no difference in the figures in respect of the collections which had been made under the State Tariff and those made under the Federal Tariff as first introduced. There is no reason why that should not be so. The only different factor is that under the Federal Tariff there is a lower duty on undressed rice. Did the honorable senator expect that a rice-dressing factory would be started in Queensland before the duty had been finally fixed, and when it was known that an attack was going to be made upon these duties ? That it will be started before long is made manifest by the fact that as the result of the difference of 2s. 8d. between the two duties under the Victorian State Tariff, two tons of locally dressed rice have been entered for home consumption here for every one ton of imported dressed rice. Why should not the same result take place in Queensland ?
– That has been the result of 20 years’ work.
– Does the honorable andlearned senator expect that during the next 20 years the progress made under federation will be only the same as that which took place before its establishment ? Queensland has not to wait to start a factory for itself; there is one in Victoria ready to supply its wants.
– They will soon start one in Qusensland.
– I thank the honorable senator for that contradiction of his honorable and learned colleague. His statement completely demolishes Senator Drake’s argument that for many years to come bulk rice will be imported in a dressed condition. Whether they do or do not start a mill in Brisbane the existence of a ricedressing mill in Victoria means that there will be an increasingly larger proportion of undressed rice imported and treated here as compared with the quantity of imported dressed rice. I dwell on that point, because I think we are agreed that the revenue aspect of this case is of some importance. On the statement made by Senator O’Connor, with which I agree, that we cannot expect trade to be removed from ordinary channels at a moment’s notice, we must admit that the eight months which have passed since the introduction of the Tariff, with all the uncertainty as to what it will be as finally passed, constitute too short a period to permit of factories developing under it. But we all expect that industries will spring into existence under it, and it is impossible to ignore the fact that what has taken place in Victoria will take place in all the other States. Queensland, with no differential duty, has hitherto imported all its rice dressed; but, like Victoria, it will, sooner or later, consume a very large proportion of locally-dressed rice. That being so, it is an utter waste of time to dwell so lovingly as Senator Drake did upon an estimate of revenue based upon the assumption that the rice which will come in will pay the higher duty. If the honorable and learned senator will say that the conditions of Queensland or any of the other States are in such markedcontrast to those prevailing in Victoria as to warrant the assumption that they will continue importing dressed rice, I will vote for his proposal. I think he will see, however, that what has been the effect of a similar duty in Victoria will be the effect that will follow in the other States.
– In my opinion the duty is not high enough, and it is to be regretted that any alteration was made in another place. I do not think very great injury can be done to the mass of the people of the Commonwealth by keeping up the duty on rice. I find that we have agreed to the following duties on other foods-: - Sugar, 6s. per cwt. ; biscuits,1d. per lb., or8s. 4d. per cental ; candles,1d. per lb., or8s. 4d. per cental ; cocoa, 8s. 4d. per cental ; coffee, 3d. per lb. ; eggs, 6d. per dozen ; currants, 2d. per lb. ; oatmeal,1/2d. per lb., or 4s. 2d. per cental ; rolled oats,1/2d. per lb. ; groats, 1/2d. per lb. ; maizena,1/2d. per lb. ; hops, 6d. per lb., or £2 10s. per cental ; and milk 1d. per lb., or 8s. 4d. per cental. Why do honorable senators attack the duties on rice ? What is the reason for the great distinction which has been made between rice and other foodstuffs? Honorable senators may be under the impression that rice is an article of very great consumption amongst the general public, but I am inclined to the opinion that the 80,000 odd aliens throughout the Commonwealth consume a great deal more of the article than do the white population. Honorable senators must know that 1 lb. of rice goes a long way, ‘and I know that in my family we do not use it more than about once a week. I think that even if the price of the article were raised a little to the people of the Commonwealth no very great hardship would be done. I find that in Queensland, in spite of a high duty of 8s. 4d. per cental, according to the retail prices current in 1900, rice could be obtained at from 21/2d. to 3d. per lb., and at that price it probably could be obtained throughout the Commonwealth. I ask honorable senators to listen to the following quotation from one of our authorities upon the resources of Queensland. This will be found at page 289 of the 1897 issue of Queensland: Past and Present -
The cultivation of this cereal is chiefly confined to the northern division of the colony, the rainfall there being more reliable than in the seraitropical portions of Queensland. Although not greatly used as an article of diet by the AngloSaxon -
I draw the attention of honorable senators who say that rice is greatly used by white people to that statement. yet it is admittedly one of the most valuable of food products, and is coming into use very much more in Europe - its consumption having been doubled within the last twenty years. Information respecting the crops for the past six years is centred in the following statement :-
Nearly half the crop is grown at Cairns, and chiefly by Italians, on the Metayer system. Swamp rice can only be profitably grown with European labour in situations which allow of the ground being prepared with implements and the Seed sown at once on the field, and where the ground is again dry for harvesting. Such conditions are only obtainable in certain localities, and require an expenditure of more or less Capital. Some varieties of rice have recentlybeen introduced which can be grown equally well on either wet or dry ground. One of these, it is stated, can be sown broadcast ; it is also most prolific, and possesses the advantage of not shedding its grain when ripe. It therefore seems probable that the cultivation of this cereal will extend at least sufficiently to meet the requirements of the home market. The consumption of rice in the colony is largely increased by the presence of the Chinese, and the imports last year amounted to 7,448,701 lbs., valued at £42,033. This, with the production, taking the bushel or paddy at 40 lbs. of dressed rice, would give a consumption of about 8,270,000 lbs., worth about #47,000, of which not quite one-tenth is produced in the colony.
An argument which should, I think, have some weight with honorable senators is that this duty is one of the very few means by which we are able to compel the alien population of the Commonwealth to pay a fair share towards the cost of the government of the country. It is a fair argument to point out that the alien population do not pay the same share of taxation as white people who live in a better way, are better housed, wear better clothes, and eat better food. If I draw the attention of honorable senators to the fact that Chinamen and Hindoos herd together in great numbers in habitations which in most instances ought to be pulled down by the municipal authorities, and that they use few food stuffs Other than rice, it is a fair deduction to draw that we should put up the price of this article as much as we can.
– The white peopl also use it.
– I know they do, but not to the extent honorable senators imagine. We have agreed to duties upon other food stuffs, many of which are used to a much greater extent by the general population than is rice. Take sugar for example. I find at page 412 of Coghlan, that New South Wales consumes no less than 103 lbs. of that article per head of population per annum. Victoria 92 lbs., Queensland 129 lbs., South Australia 98 lbs., Western Australia 114 lbs., and Tasmania S4 lbs. The average consumption of sugar per head of population for the whole of Australia is given at 99 lbs. Honorable senators will find that the average consumption of rice per head is only about 10 lbs. In the consumption of rice, - we have to take into consideration the presence of some 80,000 aliens, who make it their staple article of diet, and as they use it four and five times a week, there is no doubt thev consume a very great deal more than 10 lbs. per head. I propose to move later on that the House of Representatives be requested to make the duty upon undressed rice 4s. 4d. per cental.
– The present motion must be withdrawn to enable the honorable senator to do that. I ask Senator Symon if he is willing to withdraw his motion for that ‘purpose.
– After the long debate we have had, I shall not withdraw it.
– The honorable and learned senator refuses to withdraw. We shall see in a minute whether he will or not.
– There is no use in the honorable senator proposing a motion if the Government are opposed to it.
– That is a matter for my personal consideration. I say that a more reasonable proposition would have been to make the duty upon undressed rice 4s. 4d. per cental instead of 3s. 4d., taking into consideration what has been done in another place, and what may be done by the Senate.
– If the honorable senator will permit me to interrupt him,. I desire to say that, in order that the whole matter may be fully discussed, though we have had a long debate, I am quite willing to withdraw my motion temporarily.
Amendment, by leave, withdrawn.
– I should not object to the interruption if I were not under the impression that the honorable and learned senator has found upon reconsideration that he had no possible hope of objecting, because the ruling of the Chairman has been that these motions must be considered, and that fair play shall be given to every honorable senator. Let Senator Symon refuse to withdraw his motion, and we shall fight it out. If thecontention is that thedifference between the duty on undressed rice and the duty on dressed rice is too great, and that it means putting into the pocket of a certain Victorian miller several thousands of pounds per annum, then we ought to reduce that difference by increasing the duty on the undressed commodity. For probably five years, as Senator Drake has said, the major portion of the rice consumed in the Commonwealth will have to come through the Custom-house, as is indicated by the fact that the Queensland registrar in a late publication stated that the rice industry in that State had not progressed as might have been expected. I am very much afraid that under the proposal in the schedule no great headway will be made by this local industry, in view of the prices at which the Japanese and Chinese are able to produce the article.
– Revert to the original duty of5s. 3d.
– I am under the impression that if the duty be raised to5s. 3d. we shall beable to afford some protection to the rice-growers in Queensland, and I therefore move -
That the House of Representatives be requested to amend item 46, by adding to the duty - “ Rice, viz., uncleaned per cental, 3s. 4d.,” the words “and on and after 1st July, 1902, 5s. 3d.”
I should like to know from the Chairman what his decision is on the question between Senator Symon and myself as to the priority of the motion?
– The question is perfectly clear, so far as procedure is concerned. I have laid down the rule that proposals for lower duties must be taken first, motions to increase duties being received in the event of the rejection of the former. I understand that Senator Higgs desires to know whetherhe would have been at liberty to submit his motion had not Senator Symon given way. Senator Higgs would not have been at liberty to submit his motion under those circumstances, for the reason that Senator Symon’s proposal dealt witha later portion of the item. When once a proposal is put from the Chair, the senator proposing it has to be consulted and his consent secured before a motion can be submitted in regard to an earlier part of the item. If Senator Higgs had intimated to me, at the time Senator Symon rose, that he had an intention to submit a motion dealing with an earlier portion of the item, it would have been my duty to receive his motion first.
– Since that is your ruling, Mr. Chairman–
– It is the law of Parliament.
– But it isyour ruling ; and I, therefore, beg to withdraw whatI said in reference to Senator Symon.
-I shall be obliged to oppose the motion of Senator Higgs. The whole question of the amount of these duties, and their relation to one another, was settled by the Treasurer after very careful consideration of the necessities of the revenue and the incidence of protection. I should have preferred a dutysuch as is now proposed, but we must have regard to revenue and to protection, and find a fair mean between the two ; and I feel bound to adhere to the duty which was agreed to in another place. The duty was not agreed to hastily, but after very careful consideration, and, as I say, I must adhere to the Tariff as it now appears.
Senator GLASSEY (Queensland). - It is rather a pity that Senator O’Connor cannot see his way to accept the motion of Senator Higgs. How the other place came to adopt the duty as it now appears is a puzzle to me. It could not be on the ground that the higher duty now proposed by Senator Higgs will overtax the food of the people. The higher duty means only an increase of 1/4d. per lb., and any one who has had experience of housekeeping must know that the consumption of rice is, comparatively speaking, trifling. Assuming, for the sake of argument, that each householder uses 1 lb. of rice in a week, then the saving by the lower duty is only1/4d.,and no one can contend that such a sum represents excessive taxation.
– This is only one item amongst many.
– I am dealing only with this item ; but I think it could be shown that, in regard to other commodities, the taxation on the people is much heavier.
It cannot be denied that the duty of1d. per lb. in Queensland was of enormous advantage to the exchequer of that State, inasmuch as it raised substantial sums from coloured residents, who otherwise would contribute in a very small way to the revenue. Queensland has suffered tremendously in her revenue, and would be greatly assisted by the £10,000 a year which the duty, if we got it back to the original rate, 1d. per lb., would yield. Later on I propose to move that we revert to the old duty of 8s. 4d. per cental, and thereby, without overtaxing the food of the people, restore the revenue to an amount approaching that received prior to federation. The Government seem to think that the motion of Senator Higgs, if adopted, will lead to trouble in another place. I do not think that will be the case, because the question is so simple, and the increased revenue would be so valuable.
Senator HIGGS (Queensland). - It is most amiable of Senator O’Connor to declare that he must stand by the Tariff as it was received from another place.
– What else could the Government do ?
– Surely the Government should stand by the Tariff as it was submitted originally. If a spirit of compromise had been shown throughout, the action of Senator O’Connor might be understood ; but the attitude assumed has been too rigid. If we find anomalies in the Tariff we ought to deal with them, and honorable senators ought not to be influenced by the declaration of Senator O’Connor. A mill may shortly be started in Queensland, if it appears that it would pay to dress rice there; but if the duty be lower than5s. 3d., a great deal of rice may come to Victoria, and that State get the benefit of the revenue. It would be fairer to Queensland, from both the protectionist and revenue point of view, to fix this duty at the figure originally proposed by the Government. Queensland has been successfully appealing to the public, and creating some irritation in connexion with the losses of revenue which she has suffered ; and to allow a lower duty than 5s. 3d. might give rise to further complaint. I am in great hopes that the duty on tea will not be re-imposed ; and this is an additional reason for the higher impost on rice.
– I intend to support the motion of Senator Higgs, because I think it is the only proposition that is likely to give us the revenue which, speaking principally from the Queensland point of view, it is necessary that we should get. The proposition of the Government neither protects nor gives revenue. The proposition of the Opposition, which of course is not intended to protect, does not give revenue. Prom my point of view, both propositions fail in their object. I would vote very gladly for a protective duty on rice, because it is a cereal that can be largely grown in Queensland. The Commonwealth’s consumption is about 20,000 tons per annum, and I am certain that with a little encouragement that quantity could be produced in Northern Queensland, and taking the value at £10 a ton, we should have £200,000 added to the capital of the Commonwealth. As it appeal’s to me that both the Opposition and the Government have made up their minds that this commodity is not worthy of any protection, except so far as the cleaner in the Commonwealth is concerned, I am bound to consider the question purely from the revenue point of’ view. Queensland has been getting a revenue of between £30,000 and £40,000 per annum from the importation of rice. If the proposition of the Government is carried, we shall lose a very large portion of that revenue, and opposed as I am to revenue duties on food, I should gladly support any departure which would reduce duties of that character.
– Rice is food.
-It is food ; but I would ask honorable senators to remember that it is consumed most largely by the alien population of the Commonwealth. The total consumption of rice is 20,000 tons per annum, and the total number of aliens in the Commonwealth is 80,000. If the Europeans within the Commonwealth did not eat a single grain of rice in the year, there would be consumed by each alien only 5 cwt. per annum, or about11/2 lbs. per day. The largest proportion of these aliens eat rice three or four times per day, and take a very considerable quantity of it at each meal. I do not think I am overstating their consumption when I say that it is 10,000 tons per annum, or3/4ofa lb. each per day. These Asiatics eat very little else than rice except on festive occasions, and they contribute comparatively little to the revenue in any other way, for they do not drink whisky or smoke tobacco or use dutiable articles of any description, except, of course, opium, which is, comparatively speaking, a very small item. Almost the sole avenue by which we can get any taxation out of these people is a duty on rice. That is the reason why I am so strongly opposed to the sweeping reductions that are contemplated. We have the Government opposing the motion of Senator Higgs. I was not fortunate enough to hear the entire speech of Senator O’Connor ; but it appears to me that he based his opposition to the motion chiefly on the fact that the Treasurer had gone fully into this matter, and had made up his mind that, from both the protective and revenue point of view, his proposal was the best. From the protective point of view, his proposal is simply rubbish, because it will have no effect. In Queensland a duty of1d. per lb., or 8s. 4d. per cental, did not assist in building up the rice-growing industry to any extent. The growing of rice is not an occupation which even Chinese are very fond of pursuing. The)’ find that market gardening is a much more pleasant occupation, while whites avoid the very sight of it. If the Commonwealth is desirous of protecting this industry, the duty will have to be very much higher than 3s. 4d. per cental. From the protectionist point of view the proposal of the Treasurer is simply inoperative. It gives no protection to the grower. From the revenue point of view, with which I am more immediately concerned, how will Queensland fare under the proposition of the Government, the uncleaned rice paying duty at 3s. 4d.per cental, and the cleaned rice at 6s. per cental? Notwithstanding the efforts of Senators Drake and O’Connor to prove the opposite, it is only fair to assume that a certain proportion of uncleaned rice will come into Queensland. In Queensland uncleaned and cleaned rice were taxed at the same rate, and the result of the operation of the duty was that no uncleaned rice came in. Because no cleaning factories have been established since the introduction of the Tariff in October last, those honorable senators have come to the conclusion that cleaned rice will continue to hold the market in that State. An assumption of that character is entirely gratuitous. No one would expect cleaning factories to be established in the State until the duties had been finally settled by the Parliament. No man would invest his capital on the basis of an uncertainty such as the Tariff is. But the probability is that if the margin is left at such a large sum as 2s.8d. per cental, factories will be established. We have the example of Victoria before us. In Victoria we find that a third of therice came in cleaned, and twothirds came in uncleaned to be dressed here, the differencein theduties on the cleaned and the uncleaned being only 2s. per cental. If that happened in Victoria, it is quite fair to assume that it will take place in Queensland. Supposing that the example of Victoria is followed in Queensland, what position shall we be in ? If two-thirds of our imports pay duty at 3s. 4d. per cental and onethird at 6s. per cental, it will mean a tremendous loss of revenue.
– But it took nearly 20 years to do that in Victoria.
– The deduction I draw from the Victorian figures is that if we have the same conditions in Queensland, a similar result will inevitably follow.
– In the same period of time.
– It may take five or ten or twenty years, but the same result will inevitably follow. If we are going to protect anybody we should protect the grower first and the cleaners afterwards. From the revenue point of view, neither the proposition of the Government nor that of the Opposition is satisfactory. Senator Higgs’ proposition would be much more so. Supposing that we have aduty of 5s. 3d. per cental on uncleaned and 6s. per cental on cleaned rice, the result will be that only cleaned rice will come in, and we shall get the full duty on that article. But if the proposition of the Government is carried, one portion of the imports will pay duty at 3s. 4d. per cental, and another portion at 6s. per cental. If we add the two duties together we get a total of 9s. 4d., or an average of 4s. 8d., so that, even assuming that a half of each kind comes in, you have a balance of 4d. in favour of the duty of 5s. per cental, suggested by Senator Symon. I confessthatI am ratheronthe horns of adilemma. The difference between the two duties is so little that I am in a difficulty as to what I should do. Either the Government or the Opposition should meet us in this matter. Is the leader of the Opposition bound to the duty of 3s. 4d.,or would he agree to a compromise between 3s. 4d. and 5s. 3d., permitting the duty on cleanedrice to stand as it is? That would bring about the result which the members of the Opposition seem to desire, so far as concerns giving protection to the cleaner, while it would produce better results from the revenue point of view. At least half the rice consumed in the Commonwealth is eaten by aliens, and probably, no matter what the duty was, they would consume about the same quantity. I intend to support Senator Higgs’ motion, but if that is defeated I reserve to myself the right either to support or oppose the proposal of the Government, as may seem to me to be best.
Senator Sir JOSIAH SYMON (South Australia). - It is due to my honorable friend, Senator Stewart, that I should respond to what he has said. I cannot consent to increasing the duty on undressed rice, for two reasons. First, I do no not like increasing duties at all, and secondly, I do not like increasing duties on articles of food. It is true that if the duty is raised on the undressed article, protection will be given to rice production in Queensland. Of course, I am in favour of local production, and if we were considering the matter from that aspect, Senator Stewart’s argument would be a strong one. But if the duty be increased, we are brought face to face with the question that has been raised to-day - the increased protection that would be given to the dressers of rice.
Question - That the House of Representatives be requested to amend item 46 by adding to the duty “Rice, viz., uncleaned, per cental, 3s. 4d. “ the words “and on and after 1st July, 1902, 5s. 3d.”- put. The committee divided -
Ayes … … 9
Noes … … 19
Majority … … 10
Question so resolved in the negative.
Motion (by Senator Sir J osiah Symon) -
That the House of Representatives be requested to amend item 46 by adding to the duty “ Rice, viz., n.e.i., per cental, 6s.,” the words “and on and after 1st July, 1902, 5s.” - put. The committee divided -
Ayes … … … 17
Noes … … … 11
Majority … … 6
Question so resolved in the affirmative.
-I regret the vote that has just been given. I have already intimated that I desire to move to increase the duty.
– The honorable senator cannot do that, because we have carried a motion that the duty shall be 5s.
– Then I still more regret the vote that has been carried, and am sorry that I have not the opportunity of making a further proposition.
Item 47 (Sago and Tapioca) agreed to.
Item 48. - Salt, n.e.i., per ton,12s. 6d.
– I do not propose’ to table any motion in regard to this item. The word “ compromise “ has been used in many instances in which it was not applicable, but it may well be applied to thisitem. I should have been very glad to have seen a reduction of the duty under other circumstances, but I find from the records that in the first place a duty of 10s. per ton was first carried in another place, that upon a recommittal the duty was increased to 15s. per ton, and that finally, on the 18th April, it was moved by the honorable member for Macquarie as a compromise, and accepted as such, that the duty be 12s. 6d. per ton. On that ground I do not think the duty ought to be disturbed.
Item agreed to.
Item 49 (Seed, canary, hemp, and rape), agreed to.
Item 50. - Seed, cotton, per cental, 4s.
– I move -
That the House of Representatives be requested to amend item 50 by adding to the special exemptions, “On and after 1st July, 1902, for making cotton seed oil under departmental by-laws.”
This motion, if carried, will bring cotton seed into line with linseed, which is dealt with in item 28. A duty of 2s. per cental is imposed on linseed, but there is a special exemption in respect of linseed used for making oil under departmental by-laws. Cotton seed oil is a very important raw material in the manufacture of soap and other things, and as the oil - the manufactured article - is subject to a considerable duty, it is eminently fair that cotton seed imported for the purpose of making oil under departmental regulations should be admitted free.
– I oppose this motion. I understand that cotton seed oil is used largely as an adulterant of olive oil. It is sold very often as olive oil, or else mixed with that article, and we think that under the circumstances all imported cotton seed should pay duty.
– Cotton seed oil would be methylated if used for soap. That could be provided for in the departmental by-laws.
– I understand, of course, that if it were methylated it could not be used for human consumption. The reason why a difference has been made between linseed used for making oil and cotton seed usedfor the same purpose is that which I have pointed out.
Senator MILLEN (New South Wales).I had anticipated that in a matter of this kind the Government would have accepted the motion. This is an article which, under certain circumstances, is the raw material of a very important industry in Sydney. I refer to Messrs. Lever Bros.’ soap and oil cake works. It is surely one of the recognised principles of protectionists, as far as they have any principles, that raw material required for any manufacturing process shall be admitted free. This is a raw material, and it cannot be denied that it will be kept out of the country if the duty is retained. All that we ask is that it shall be admitted f ree under departmental by-laws, and surely the department has sufficient ability to frame a regulation which would prevent the fraud which Senator O’Connor has suggested ? If he cannot see his. way clear to accept the motion, I hope the committee will recognise the great injury which will be sustained by a very important industry in New South Wales if the request is not agreed to.
Senator Sir JOSIAH SYMON (South Australia). - The duty upon cotton seed oil is 2s. per gallon, while the duty on cotton seed oil, methylated pursuant to departmental by-laws, is only 6d. per gallon. It is hardly worth while interposing an obstacle in the way of people who wish to use cotton seed oil for the purpose of manufacturing by retaining the heavy duty of 4s. per cental. The duty would practically prevent the manufactureof cotton seed oil here, while these people would be liable to a duty of 2s. per gallon on. the imported oil, if manufactured in a certain way, and a duty of 6d. per gallon on the methylated oil. If there is one thing that we make successfully in South Australia it is olive oil. I am quite certain that cotton seed oil is used for adulterating the so-ealled olive oil which comes from certain parts of Europe, but it will not be used for adulterating olive oil manufactured here for at least a century to come. We have the pure article here, and it would not pay to make the adulterated article. Whilst I should be at one with Senator O’Connor in interposing any difficulty in the way of the adulteration of any article, I do not think that the retention of this duty where the oil is made for the purposes of manufacture will have any such effect. That desire would be more effectually accomplished by local legislation for preventing the adulteration of food compounds.
– It is difficult to conceive why the Government should refuse to agree to this very simple motion, which will allow an important manufacturing industry . to be carried on, and without which the industry cannot be worked. The oil produced from cotton seed is invaluable for the production of a high-class soap, and if circumstances are allowed to develop properly Australia is likely to have a very large oil trade in respect of seeds of various kinds. It would perhaps meet the difficulty suggested by Senator O’Connor if we were to insert the word “methylated.” The proposal would then, I think, meet the views of all parties. Whatever our opinions on the fiscal question may be, I do not think there is any honorable senator who would wish to interpose an obstacle in the way of the production of a manufactured article.
Senator Sir JOSIAH SYMON (South Australia). - To prevent the possibility of this oil being used for adulterating olive oil, I propose, with the permission of the committee, to amend my motion by inserting the word “ methylated “ after the word “ making.”
Motion, by leave, amended accordingly.
– I cannot understand the attitude of honorable senators who oppose this duty. Senator Symon and other free-traders from South Australia are interested in protecting the salt industry in that State, and when the item of salt was before us no proposition was made in regard to any alteration. Now we find that Senator Pulsford thinks that the motion before the Chair ought to appeal to every honorable senator because Messrs. Lever Bros, cany on soap-making works at Sydney, and will have to shut down unless the motion is carried. My principal object in rising was to draw attention to the inconsistencies of Tasmanian free-traders, who would not agree to a reduction of the duty upon hops ; of South Australian freetraders, who would make no attack upon the duty upon salt : and now of New South Wales free-traders, who, in this particular instance, are studying the interests of a protected industry.
– Although I cannot consent to this motion, I do not propose to take up further time in debating it. Senator Symon has placed his position before the committee clearly, and I have answered him.
Motion agreed to.
Items 51 (Soap) and 52 (Spices) agreed to.
Item 53. - Starch and starch flours, including rice meal, and rice, tapioca, and potato flour, per lb., 2d.
Senator Sir JOSIAH SYMON (South Australia). - We come now to an item which is familiar to tis all. I propose to move that the duty upon starch be l£d., and to deal separately with starch flours, including rice meal, and rice tapioca and potato flours, which are in a different category from starch. Tapioca flour, for instance, is scarcely known in the Commonwealth, except as an article used in the manufacture of confectionery, and for it a much better substitute is provided in the shape of cornflour. I move -
That the House of Representatives be requested to amend item 53, by inserting after the word “starch,” the words “per lb., 2d., and on and after 1st July, 1M02, 1ld.:
Prom one point of view, the question here involved is, of course, that of revenue, and from another aspect, just as in the case of rice cleaning, the question of protection arises. I shall point out briefly what the position is in regard to this duty of 2d. per lb. I do not forget in what I have to say that there is an excise duty of Id. per lb., so that the protection is Id. per lb., although the duty appearing here is 2d. In considering whether this is not too much protection, we must remember that the whole of the rice from which starch is made comes in free. I have a few figures which will show honorable senators that this protection of Id. per lb. is prohibitive. Taking the States of New South Wales and Victoria, for purposes of comparison, I find that the imports of starch to New South Wales for 1900 amounted to 5,080,555 lbs., of which 1,476,944 lbs. were from the other Australian States, leaving the import of starch into New South Wales from abroad, at about 3,500,000 lbs. The total import of starch to Victoria for’1900, from outside the Commonwealth, amounted to only 116,705 lbs. In 1899, the figures I have for New South Wales show the imports to have been 3,276,006 lbs., of -which about 1,000,000 lbs. came from the other States, and the total import for that year to Victoria was only 56,015 lbs. There was no excise duty in Victoria, but there was a Customs duty of 2d. per lb., and these figures are absolutely conclusive as to the effect of that dutv. They show that it practically prohibited the importation of starch into that State, and, as a consequence, destroyed all revenue from it. It is equally prohibitive of importation now when the duty is 2d. per lb., but we shall get back a portion of our lost revenue by means of the Id. per lb. excise. It is obvious that the production of the article in Victoria has very largely overtaken the demands of the Commonwealth market, and if we leave the import duty at 2d. per lb., we shall get no Customs revenue, and the revenue derived from the excise duty of 1d. will, of course, be only half the revenue which we should otherwise get. With reference to the smaller States, we must look at the duties they were imposing, not as a guide to what the duty should be under this Tariff, but as showing what their position will be in regard to the Customs revenue, which we must seriously consider. The duty imposed upon starch in Tasmania was 1d. per lb. That duty was probably collected upon starch which came from Victoria, but the possibility of Tasmania getting duty at 2d. per lb. or 11/2d per lb. upon starch is done away with, because Victoria will supply her wants.
– But Tasmania will get the excise duty of1d. per lb., and she cannot lose anything.
– She has no chance of getting revenue from the Customs duty of 2d. per lb.
– But she only got the benefit of a penny duty before.
– It is clear that this duty will not benefit her in the slightest degree. Queensland had a duty of 2d. per lb.
– And we got £10,000 a year from it.
– And in prohibiting the importation of starch we are going to cut the Queensland revenue in two. I do not know whether there are any starch factories in Queensland, but if there are not, the demand for starch in Queensland will be satisfied, in all probability, by the products of Victoria, and of New South Wales if they make starch there. The result will be that Queensland will receive in future only the excise duty of1d. per lb. My own State of South Australia will be in exactly the same position, if we keep up this heavy duty of 2d. per lb., which, in view of the excise duty, represents a heavy protective duty of1d. per lb. Our revenue from starch was collected from a duty of 2d. per lb., and if our importation from beyond the sea is diminished, and out supplies come from the large eastern States in which starch is manufactured, our revenue will be cut in two. Considered from the point of view of revenue, there can be no doubt that the protection to this article should be reduced to a fair and reasonable amount so that the manufacturer may not be aggrandized and become a monopolist, but may have his industry, in the phrase used by the Prime Minister, “preserved from destruction.” I find that Colman’s packet starch, f.o.b., in London, costs £21 10s. per ton less the usual discount, which is 71/2d. Before the duty was imposed the selling price in Sydney was £25 10s., less 21/2 per cent. Sydney being a free market, a great deal was imported, and holders, in order to get rid of stocks, will no doubt sell at a little below the highest price. At the same time these people will get the benefit under the Tariff, and unfortunately we cannot prevent that occurring. With the duty as proposed by the Government the selling price in Sydney will be from £44 10s. to £45 for the imported article, and that heavy price will, owing to the universal use of starch, be charged for the benefit of not more than two or three starch manufacturers in the Commonwealth. The natural protection afforded by the freight from London is £3 to £3 5s. per ton, and by exchange and insurance, about £1. These charges represent an advantage to the local manufacturer of about1/2d. per lb., which, taken in conjunction with my proposal, will give a protection of about1d. per lb. Rice is the raw material of starch, and is admitted free ; and it will be admitted that the manufacturers in Australia can get this rice as cheaply as can the London manufacturer. As a fact, the manufacturer in England pays a great deal more for his raw material, but I am placing both on the same footing. The local manufacturers have now the enlarged market of a united Australia, and that, coupled with the natural protection-which means a considerable sum when reckoned in tons - affords ample advantage. The starch manufactories in Victoria have been established for a considerable time, and have their market, as is shown by the fact that importations into Victoria are infinitesimal. But we wish to get some revenue in the other States, and not to create a monopoly for two or three manufacturers. While we wish to be reasonably careful of the interests of those engaged in this industry, we do not desire to continue the advantages they have enjoyed under prohibition in Victoria.
– I cannot understand the kind of argument which has just been addressed to the Senate by Senator Symon. It is argument based on the assumption that the existing factories in any one State are to continue to supply the. wants of all the other States.
– That will be the effect notwithstanding.
– I can understand Senator Sargood patriotically assuming that none but Victorian manufacturers can make starch.
-Vic toria has the starch factories.
-But I hope that it will not be the privilege of “Victoria for all time to supply the rest of Australia. The manufacture of starch is a simple matter, and, seeing that it is already carried on to a certain extent in South Australia, there is no reason why it should not prove successful in the other States. The assumption of Senator Symon is not only unwarrantable, but shows a lack of confidence in the resources and power of our own people. The honorable senator must have forgotten that a large part of the demand in South Australia is met by local production.
– Starch is exported from South Australia to New South Wales.
– I have no doubt that a large portion of the starch consumed at Broken Hill and other places in New South Wales is manufactured in South Australia.
– Does Senator O’Connor know thatSouth Australian manufacturers are establishing themselves in Sydney?
– I dare say that is so, and I presume these manufacturers will continue their establishments in South Australia. I understand that many Victorian manufacturers are commencing operations in Sydney.
– That is since the Tariff.
– They are attracted by the natural advantages of Sydney.
– I hope that the New South Wales people recognise that they are beginning to reap the fruits of this Tariff, which has almost to be forced upon them. It is reasonable to suppose that all Australia will benefit from manufactures of the kind under discussion ; and there is no reason why they should not be carried on in Tasmania, Queensland, and other parts of the Commonwealth. Where an article can be produced as profitably in one place as in another, the local manufacture always has a certain amount of advantage, in that there is no freight to pay. We know that oversea freight for a short distance is proportionately much heavier than freight for a long distance, and if the goods have to be carried by railway, the charges are heavier again. No doubt there will be larger factories in some places than in others, and the question of the cost of production, as regulated by the output, will have to be considered ; but it is altogether against patent facts and probability to assume that any one State will supply the rest of the Commonwealth with starch. I make these observations because they bear upon the contention of Senator Symon that there is going to be a great loss of revenue - that revenue is going to be cut in two. I think Senator Symon is making a mistake in separating starch from starch flour, both being the same article in different forms, and used in the same processes. I suggest that if the honorable senator asks the Senate to adopt his motion, the words should be insertedafter “ starch flour.” I know, of course, that although tapioca and similar articles are placed in this division, they are foods, and practically another substance. The Government propose a duty of 2d. on starch and starch flour, but the excise reduces to a penny the benefit given to existing factories. We have to contrast this protection with the benefits which starch manufacturers had in the States previously. In Victoria the duty was 2d.; South Australia, 2d.; Queensland, 2d.; Tasmania,1d.; Western Australia, 15 per cent. ad valorem ; and in New South Wales starch was free. In three of the States the duty proposed is only half of what it was previously. I do not suppose there are any factories in Western Australia, but the protection afforded there is, of course, more now than previously. There have beenexpressions of opinions from both protectionists and freetraders that nothing should be done to interfere with existing industries.
– To destroy existing industries.
– If we are going, as the honorable and learned senator says, to destroy existing industries, it does not mutter what the process of destruction is - whether we shut them up at once, or whether we gradually bleed them to death by giving them a protection which is not sufficient, but under which they will struggle along for a little while and then die. What we have to consider now is whether this duty will enable the industries to keep alive. A very strong element in that consideration is what duty existed before, and what proportion it bore to the value of the article. What the honorable and learned senator proposes to do is to reduce the protection to Jd. per lb.
– Plus the natural protection.
– The natural protection is outside the question, when I am comparing the duties. When the protection is a fourth of that which existed in Victoria, South Australia, and Queensland, and a half of that which existed in Tasmania, it is utterly unreasonable to say that it is sufficient to carry out the object which we ought to have in view. The honorable and learned senator has purported to show by some figures he has quoted that this protection is so large when added to the natural protection that it is altogether unreasonable, but I submit that he has not shown that. He has quoted some figures which, if they are true, would tend to show that starch cannot be imported. If what he says is correct, how is it that any starch comes in here?
– Hardly any does come in. In 1899 only 56,000 lbs. were imported to Victoria as against 3,276,000 lbs. to New South Wales.
– In 1898, £2,’S00 was collected in this State under a duty of 2d. per lb., and with no excise duty at all.
– In the six months from the 9th October last, £5,354 was collected under the duty of 2d. per lb.
– That covers all the flour as wall.
– It covers starch and starch flour. Surely the best test of whether the duty is or is not prohibitive is the importation during those six months ? How can any one say that it is prohibitive when we find revenue coming in at the rate of £10,000 a year? It is now proposed that the protection shall be reduced by one-half. The excise duty will yield a revenue.
– There will be the cost of the excise officers.
– That does not enter into this comparison. We shall go on collecting, even with the excise duty, the same amount from outside as we collected before; in fact, a larger amount, because £5,354 was collected for the half-year in the very circumstances we are now considering. The excise duty will be collected wherever the Australian starch is consumed. No matter what the production of starch may be, a State will get the excise duty and the import duty. Tasmania, for instance, will get an import duty of 2d. per lb. from foreign starch, and an excise duty of Id. per lb. from Australian starch, no matter where it was made.
– I thought the Minister was arguing on the question* of protection. On the question of revenue that is quite right.
– This duty, likemany others, must serve a double purpose, and you cannot pass a Tariff, of this kind under the circumstances in which, it is being considered unless you make it both protective and revenueproducing. For a moment I stopped dealing with the protectionist point of view to answer an interjection with regard to revenue. There ought to be some uniformity in the way in which we deal with the Tariff, and it ought not to be in the power of the people of one State to say, “ It is all very well for you free-traders to take precious good care that one industry is protected while another is left alone.” And when they search through ‘the Tariff and consider all the circumstances connected with the article, where do they find a reason for the difference? We ought to be careful that nothing of that kind is apparent in our work. If we are to consider this duty from the point of view from which so many duties have to be regarded we must first of all see whether it gives a fair amount of revenue, whether it leaves the revenues of the States as far as possible in the same position as they were in before, and whether it gives a fair amount of protection to industries which are in existence. It is all very ‘well to talk here about id. or -Jd. per lb. being enough protection. But if you make a mistake and do not give enough protection, what will be the result ? Hundreds of persons will be thrown out of employment. It will be said that they will find something else to do. That may be so, but it is very hard comfort, and the process of driving them out of one employment into another ought not to be undertaken or even risked unless there is some very strong reason for it.
– Another aspect of the question to be considered is that the consumer would have to pay more for his article if he were left to the tender mercies of the importer. There can be no question that the price of starch would go up at once if our industries were destroyed. It is not so very long ago since German starch - a very good article - was quoted here at 4d. per lb., after it had paid a duty of 2d. per lb., not for the purpose of benefiting the consumer, but for the fixed purpose of closing up the Victorian factories. I shall show from the figures given by the leader of the Opposition that starch manufacturers in other countries will, if they can, capture the market in Australia. I understood the honorable and learned senator to say that before the federal duty was imposed the price of starch - Colman’s, I presume - was £21 10s. in London and £25 10s. per ton in Sydney, and that the freight was from £4 5s. to £4 10s. per ton.
– Freight £3 to £3 5s., and insurance £1, or in all £4 to £4 5s. per ton.
– If the landed cost of the starch was thus £25 15s. per ton, then it was being sold in Sydney at 5s. per ton less than it cost.
– Theprice I quoted was £21 10s. per ton, less 71/2 per cent.
– I asked the honorable and learned senator to repeat his figures, which he did, and I thought I had taken them down correctly, because I saw at once that it would cost 5s. or 10s. a ton more delivered in Sydney than the importer asked for it. I am not talking about the discount for ready cash.
– What I said was that the price in London was £21 10s. per ton, less 71/2 per cent.
– As the importer would be sure to make some loss in trade, he certainly could get no profit.
– In that case the honorable senator has not much reason to complain of the importer.
– I have, because the importer sells at that price for the purpose of killing the colonial industry. I am not saying that he is to blame, from his point of view. I am only trying to bring out the effect of closing our starch factories. It must be admitted that if our starch factories had been closed the over-sea importer would have had all his own way in New South Wales. In that case it is only natural to suppose that he would have put on a reasonable price for profit, and if he had that would have increased the cost of starch. When the Germans were sending starch here they sold it at a price less than the cost of production in Germany. They sold it for 4d. per lb., although it had to pay a duty of 2d.
– The manufacturers of Victorian starch pursued the same practice in the other States.
– And if it were not for the Victorian starch the importers in the other States would have it all their own way.
– What about South Australia, where Victorian starch was sold at a low rate to ruin our factories ?
– I am not defending the Victorian manufacturer; I am not his apologist. If he wished to secure the South Australian market, he had just as much right to adopt that policy as had the importers of starch from oversea.
– Then why complain of the importers ?
– I am not complaining of them ; I am simply pointing out the result that would follow from wiping out the local starch industry. If I had my way, I would increase the duty to 3d., but I am perfectly certain that if I moved to that effect, the Government would stick to the Tariff as it stands. We are placed in an awkward position if we desire to increase a duty for the benefit of the people of this country. The Government then vote with the free-traders- not because they like the free-traders, or believe in their policy, but because they wish to adhere to the Tariff as it stands.
– Because we desire to support the compromise thathas been arrived at, and the honorable senator will find that that will be the stronger position by-and-by.
– I want to direct attention to the wages paid in England in the starch industry as compared with those paid here. Notwithstanding the duty, Colman sends out his starch, and sells it practically without any profit ; but he is able to do that on account of the low wages paid to his work-people.
– Then he is a benefactor.
– He is a benefactor to the importer ; but I am thinking of the interest of those amongst whom I live, amongst whom I was brought up, and amongst whom I hope to die. I have here a letter from Messrs. Lewis and Whitty, who are starch manufacturers, and who have a perfect right to put their case before the committee. I have never seen a member of this firm to my knowledge, but they point out certain facts which we should regard. They say -
So much has been said in the House of Representatives upon the starch question that is not in accordance with facts, that we think it advisable to acquaint you with some particulars that justify the continuance of the present duty, and also the removal of the excise, and thereby to a great extent equalize the conditions of the Australian starch manufacturer with the English and Continental makers.
There is an excise duty under the Tariff, the result of which will be that manufacturers who have hitherto received the benefit of a duty of 2d. per lb. will only have one of1d. The leader of the Opposition, however, by reducing this duty to11/2d., will reduce the protection to1/2d. This letter continues -
Our Mr. Lewis had exceptional opportunities, when visiting the works of Messrs. Colman, at Norwich, of ascertaining particulars not generally known in connexion with their works. The information was direct and personal. They pay their men 12s. a week, provide them with a house to live in, with a little land about it, for which they charge them 2s. per week, leaving a net balance of 10s. for their services. They work ten hours a day, and if, after such working, they have the inclination to cultivate the soil about their houses, the firm undertakes to find a market for the produce. The education of the children is also undertaken by the firm, the parents paying 2d. per week for one child, 2d. per week where there are two, and 3d. per week for three, or equal to Id. each child weekly. The conditions existing here, so far as ourselves are concerned, are as follow : - We pay the men doing the same work from36s. to 42s. per week ; they work eight hours a day.
– The honorable senator does not accept the statement as to Colman’s, does he?
– I should not.
– I have no reason to think that Messrs. Lewis and Whitty would put their names to a deliberate untruth.
– It looks uncommonly like it.
– Their statement may be untrue, but I do not think it is. If I thought this letter were untrue I would throw it into the wastepaper basket.
– Hear, hear.
– But I believe it to be true. If I had reason to doubt it, I. would throw the letter into the face of the man who sent it to me rather than quote it to this committee. The letter goes on -
We think this comparison will serve the purpose so far that it will indicate how we are handicapped on the question of wages alone. There are further particulars which our Mr. Lewis will be very pleased to enter into should yon be good enough to favour him with an interview.
I have never given an interview to Mr. Lewis, thinking it sufficient to state the facts to the committee. I believe the rate of wages quoted by Messrs. Lewis and Whitty to be substantially correct in both cases. That being so, and seeing that the wages paid in Victoria are double or treble those paid in England, these facts ought to weigh with honorable senators. Honorable senators on the opposite side should not adhere so closely to their free-trade principles as to wipe out what is a natural industry, and although I cannot hope to move the leader of the Opposition, and those acting with him, I appeal to them to give this industry fair play. Surely a differential duty of1d. per lb. is little enough. In my opinion it is too small, but I apprehend that the Government will stand by their Tariff, and in that case it is utterly useless for any one who thinks with me to move that the duty be increased.
SenatorFRASER. (Victoria). - I intend to support the item as it stands. I do not think that a duty of1/2d. per lb., allowing for the excise duty of1d. per lb., is sufficient to enable manufacturers to continue. The old rate in Victoria was 2d. per lb., and there was no excise duty. The Tariff proposes an import duty of 2d. per lb., with an excise duty of1d. per lb., while the cost of the excise officer’s services have to be borne by the manufacturer, and add somewhat to the expenditure. I, therefore, do not see the slightest hope of the local manufacturer holding his own against the importer if the duty is reduced as proposed. I hope that the committee will not make any change in this item.
– In reading the letter which he has just placed before the- committee, Senator Styles has shown that he evidently possesses that great faith which is always exhibited by our protectionist friends in any argument that can be adduced to show that much lower wages are being paid in other parts of the world than are paid in New South Wales and “Victoria, in connexion with the same industry. The allegation that there is such a very great difference between the wages paid in England and Australia, in connexion with this industry, is an extraordinary one, and it is unfortunate that we are not in a position to test the validity of the information. Of course I believe that the honorable senator has quoted the statement in perfect good faith, but I should like to see the information verified by some means other than a letter written by a rival manufacturer. It is a remarkable thing that English manufacturers of starch should be exporting very largely to different parts of the world, in order to destroy the trade of local manufacturers. Senator Styles must bear in mind that these firms do not adopt that practice all the world over, although they may do so in one or two individual instances. We know that the invariable result of putting on a duty is to increase the price to the consumer. Whether a manufacturer wants an increased price or not, he will demand it when the Opportunity offers. As evidence of that, I may quote the following from a document, written on the 31st May last, by one of the principal merchants of Sydney -
Starch- 2d. per lb., or £1S 13s. 4d. Wholesale price of a certain Victorian brand last September, i£26 10s. ; to-day, £41 10s. This price, of course, includes Id. per lb. excise, and still leaves a good margin.
Honorable senators will see that the brand in question has been increased by £15 per ton in consequence of the duty imposed. Out of that, increase we have to allow for the excise duty amounting to £9 fis. 8d., so that the manufacturer puts on £5 13s. 4d. for himself. No doubt, the honorable senator will reply that this manufacturer has probably been selling at a loss of £4 or £5 per ton, because he has been obliged to compete in the open market with English and German firms, who send their starch to
Sydney. I cannot realize that this firm has been selling its starch in Sydney at a loss. I have not the information, but I should like to know the price at which its starch has been selling in Victoria during all this time. No doubt, it was fully equal to that now charged in Sydney. If the firm has been selling at a loss in Sydney, it must have been selling in Victoria at a greatly enhanced price, in order to make a profit and cover the loss sustained in free-trade New South Wales. One of the disadvantages which always arises in connexion with protected industries is that the people residing in the State in which they exist have to pay more for their manufactures than do people outside, and that if it becomes necessary for a mauufacturer to sell at a loss in the open market, he takes care to make the consumers in his own State pay that loss for him. The duty, if reduced as proposed, would give the local manufacturer a protection equal to £4 13s. 4d. per” ton.
– Out of which he has to pay the excise officer.
– If we strike off 13s. 4d. per ton in respect of the cost of the excise officer, there remains a clear balance of £4 per ton in his favour. That ought to be ample, especially when we remember his proximity to market. Starch in London is, I think, quoted at £21 10s.,- less. ls. 6d. in the £1 discount, so that the amount is reduced very considerably. Taking all things into consideration, the reduced duty will give a fair measure of protection. If Senator Symon had desired to wipe out the industry he would not have proposed a reduction of the duty to 1 1/2d. per lb., but seeing that there is an excise duty of Id. per lb. on the article, he would have proposed that the Customs duty should also be Id. per lb., so that one should equalize the other. Is” it desired that these industries should always remain in swaddling clothes, and should always be propped up ? Are they never able to stand alone ? The Victorian firms are now in a position to supply the whole of the Commonwealth. It is true that they had New South Wales as a market before, but only in open competition with other manufacturers of starch. Now, with the markets of the whole of the States open to them, they may treble their output, and, in that way, materially reduce the cost of production.
– The honorable senator must understand that this Tariff gives them only half the protection they had before.
-I admit that in Victoria that is so, but in consideration of that reduction of protection they get the whole of the other markets of the Commonwealth. I hope honorable senators in dealing with the matter will consider all these circumstances. If they do I think they must recognise that we are proposing a fair thing, and are at the some time doing some justice to the smaller States in assisting them to get some revenue, because there will probably be larger importations with a duty of l1/2d. per lb. than there would be with a duty of 2d. per lb. Those additional importations will bring about a healthy rivalry between manufacturers, which will enable consumers to secure reasonable consideration.
Senator HIGGS (Queensland).- This is a blow indirectly at the primary producer, and directly at the secondary producer. Senator Symon told us that the insurance charge on a ton of starch from the old country to Australia won £3. The honorable and learned senator submitted his figures to the committee with thegreatest confidence, but they are not reliable. As Senator Fraser on a former occasion told us if we can successfully combat one statement made by a witness, the possibilities are that the whole of his evidence must fall to the ground. If I can prove that Senator Symon is wrong in the figures he quoted in respect to the cost of insurance upon starch, why should we pay any attention to the other figures he quoted? This item of starch was one of the stock items of the great free-trade leader’s speeches on the various platforms. That right honorable gentleman asked - “What has blue done, or what has starch done that it should be taxed,” and then, forgetting himself, he proceeded to inquire why members of the various Parliaments treated the great mass of the community so harshly. He spoke of the injustice done by protection to the shearers and labourers, and generally to the great primary producers. I suppose that Senator Symon desires that starch should be admitted free because so much of it is used by the men who are employed upon Senator Fraser’s stations, and who have to starch up their shirt fronts before they go to shear sheep. I suppose that we should reduce the duty upon starch in the interests of the navvies on our railways. I point out that in Queensland many of the wage-earners do not find it necessary to wear a collar, and the men employed in our mines would not require a great deal of starch, because they do not wear even a shirt. Senator Gould has challenged the letter which was read by Senator Styles, but T. notice that when Senator Smith, lost evening, in connexion with another item, brought forward a letter from Preston and Co., who are interested in Nestle’s milk, we were asked to accept the statement it contained as gospel truth. When we asked Senator Gould himself for his authority for statements made with regard to a certain Victorian firm or brand of starch, the honorable and learned senator could not tell us the name.
– I was asked whether I could give the name of a Victorian firm. I could not do so, because the letter referred only to a Victorian brand. But if the honorable senator desires to know the writer of the letter, I can tell him at once that it was received from the firm of Learmonth, Dickenson, and Co., of Sydney.
– I do not question the authority, but I think we have every reason to believe the statements made in the letter quoted by Senator Styles, when we know so much about the wages paid on the Continent and in the old country. We have to protect our primary producers, the rice-growers of Queensland, in the first place, and in the next place the manufacturers of starch, against cheap continental productions. There is a firm of starch manufacturers in Sydney, Messrs. Clifford, Love, and Co.; and I am in hopes, when I mention the fact, that the New South Wales free-traders, who supported protectionist views in the interests of Lever Bros in connexion with another item, will see that this is an industry which should be preserved. The starch industry was established under the Dibbs Tariff, but was nearly wiped out when that arch-destroyer and free-trader, Mr.Reid, came along. It struggled on in the hope that federation might alter the conditions. A protective Tariff was introduced, and the firm tried to carry on their business a little longer. But now Senator Symon and bis satellites seek once more to abolish the duties: I regret that proper notice was not given of this motion, because I should then have been prepared with an array of facts and statistics in support of a protective duty.
Senate adjourned at 4.2 p. in.
Cite as: Australia, Senate, Debates, 6 June 1902, viewed 22 October 2017, <http://historichansard.net/senate/1902/19020606_senate_1_10/>.