2nd Parliament · 3rd Session
The President took the chair at 3 p.m., and read prayers-.
– I desire to ask the Minister of Defence, without notice, whether during this session the Government will give the Senate another opportunity of dealing with the question of the third reading of the Kalgoorlie to Port Augusta Railway Survey Bill?
– On behalf of the Ministry, I have to say that, having regard to the great pressure of public business at the present time, they fear that should the Bill be reinstated there would not be sufficient time to deal finally with it unless a mutual understanding could be arrived at between the two parties.
Is it intended by the Government to take definite action, during the present session, in relation to selecting a suitable site for the Federal Capital ?
– The answer to the honorable senator’s question is as follows : -
Until the beginning of last week members were still inspecting sites at the invitation of the New South Wales Government, consequently the question could not have been submitted earlier. The Minister regrets to say that,’ at this period of the session, having regard to the differences of opinion on the question of the site, it will obviously be impossible to obtan a final determination.
asked the Minister representing the Treasurer, upon notice -
– The answers to the honorable senator’s questions are as follow : -
Defence. - Construction of fortifications, barracks, rifle ranges, drill halls, sheds, stabling, cable to Goode Island, rifles, machine guns, artillery ammunition, and other special Defence material and equipment.
Post Office. - Construction of post offices and purchase of sites, extension of telegraph and telephone lines, instruments and material.
asked the Minister representing the Treasurer, upon notice -
– The answers to the honorable senator’s questions are as follow : -
The figures for 1898-9 are not immediately available, and would require some time for preparation, owing to the fact that State publications include considerable amounts of the expenditure under Departments other than those which were transferred. To enable an immediate reply to be given, however, a comparison is made between 1899-00 and1900-1. In this connexion it may be pointed out that, though the large spending Departments - Post Office and Defence - were transferred on 1st March, 1901, the expenditure up to 30th June, 1901, was practically under State contral, as State rate of expenditure was continued up to the latter date.
Case of James Stone
asked the Minister representing the Attorney-General, upon notice -
Have the Government yet completed the inquiries they promised to make in reference to the case of James Stone, who is alleged to have been discharged by the British- Australasian Tobacco Company because of evidence given by him before the Royal Commission on Tobacco Monopoly ?
– The answer to the honorable senator’s question is “ Not yet.”
asked the Minister of
Defence, upon notice -
Have the Government yet received any answer to the inquiries he promised to make in regard to the case of the judgment of a Western Australian Court as to the territorial limits of the Commonwealth in the case of the wreck of the R.M.S. Orizaba?
– The reply to the honorable senator’s question is as follows: -
The answer to this question involves important legal considerations, and it has been submitted for the opinion of the Crown Law officers.
asked the Minister of Defence, upon notice -
If there is any truth in the statement that the Treasurer of the Commonwealth will leave Melbourne and his parliamentary duties at a date that will be prior to the submission of the Appropriation Bill to this Senate?
– The answer to the honorable senator’s question is as follows : -
The date of the Treasurer’s departure has not been fixed.
Bill received from the House of Representatives, and (on the motion by Senator Playford) read a first time.
Message reported forwarding Bill from the House of Representatives.
– I would point out that the message forwarding this Bill is not signed by the Speaker of the House of Representatives.
– Should it be so signed ?
– I think so.
– Ought the Bill to be received if the message is not properly signed ?
– I am not acquainted with the Standing Orders of the House of Representatives, but we have no standing order relating to the Deputy Speaker signing messages. On the spur of the moment, I am not prepared to say whether the message is in order or otherwise.
– Can the Bill be received if the message is not signed by the Speaker of the House of Representatives?
– That is the point.
– I submit that there is no law against the message being signed by the Deputy Speaker. It is to be presumed that the Deputy Speaker is authorized to act for the Speaker in regard to signing messages.
– Would it not be possible to allow the matter to stand on one side until you, sir, have determined whether the Bill can be received?
– Perhaps the best course to pursue will be to read the message at a later hour of the sitting or at a future date. I shall consider the message as not having been read.
– I am perfectly agreeable to that course being pursued.
– I have considered the question of the signature to the following message from the House of Representatives : -
Message No. 26.
The House of Representatives transmits to the Senate a Bill intituled “A Bill for an Act relating to Duties of Excise,” with which it desires the concurrence of the Senate.
House of Representatives,
Melbourne, 24th September, 1906.
I find that, according to our Standing Orders the Deputy President, who acts in the absence of the President, can sign messages, and has signed messages to the House of Representatives. Therefore, I conclude that, according to the Standing Orders of that House - I do not know what they are - the message is right.
– Is that the full title of the Bill, sir?
– I do not know. That is the message.
Motion (by Senator Playford) proposed -
That the Bill be now rea’d a first time.
– Mr. President-
– There can be no debate on this motion.
– Can I not even ask a question?
– If the honorable senator wishes to put a question to the Minister, perhaps that may be allowed.
– That is all I wish to do. There have come by message from the House of Representatives two measures called Bills “ relating to duties of Excise.” I think that the Minister might tell the Seriate what they deal with, because the statement that they relate to duties of Excise really furnishes no information.
– This is the Harvester Bill.
– What is the other Bill that was received to-day ? ‘
– I have forgotten.
– The message says that this is a Bill for an Act relating to duties of Excise, and the short title is “ Excise Tariff Act 1906.”
Question resolved in the affirmative.
Bill read a first time.
asked the Minister representing Ihe Minister of Home Affairs, upon notice -
On what principle are increments to salaries awarded in the Public Service of the Commonwealth?
– The answer to the honorable senator’s question is as follows: -
The regulation of all salaries and emoluments is, by law, in the hands of the Public Service Commissioner. The increments in the General Division, and up to ;£i6o per annum in the Clerical and Professional Divisions, are practically automatic, provided the reports from their superior officers show that the officers are efficient at their work and that their conduct and diligence have been satisfactory.
Increments in the higher classes of the Clerical and Professional Divisions are dependent upon vacancies occurring, or the Commissioner being satisfied that the value or importance of the work has increased and justifies an addition to the salary paid to the officer.
.- I desire, by leave of the Senate, to make a personal explanation.
– I would point out that personal” explanations are made by the indulgence, and not by leave, of the> Senate. I take it that there is a distinction between the two things. Where leave of the Senate is asked for, the question is put, and, if no senator objects, leave is granted. Where the indulgence of the Senate is asked for, however, then, unless there is a general feeling to the contrary, an honorable senator is allowed to make his explanation.
– I shall not occupy more than a minute. On Saturday^ the Age, in discussing the proceedings in this Chamber in connexion with the Kalgoorlie to Port Augusta Railway Bill, made the following remarks: -
The outcome of a “ caucus “ meeting of dissenters was a motion by Senator Givens (W.A.) yesterday for the adjournment of the House “ to discuss the desirableness of so arranging the business as to permit of the elections being held at as early a date as possible, without unduly curtailing the right of members to discuss, important Bills involving an amendment of the Constitution.
I claim to have been misrepresented, in so far as it is stated that I moved the adjournment of the House as the outcome of a caucus meeting. No caucus meetings were he!3 by the senators opposed to the measure, and only a few casual remarks were exchanged as thev met in the corridors or the rooms outside the Chamber.
– We had no chance of speaking in the Chamber, so we discussed matters outside.
– I moved the adjournment of the House entirely of my own, volition, without consultation with any honorable senator on either side of the Chamber. The only senator who knew of my intention before I had framed my motion was Senator Stewart, and the only senators who were afterwards made aware of the step that I proposed to take were those whom I had to ask to rise in their places to support me.
– I have not interfered with the honorable senator, because I know that.it is very natural to wish to make personal explanations such as he has offered. I would point out, however, that personal explanations should be confined to matters in which senators have been mis- represented in the Senate. They would be endless if every newspaper misrepresentation were made the subject of an explanation.
In Committee (Consideration resumed from 1 8th September, vide page 4719): Clause 2 (Commencement).
Senator Sir JOSIAH SYMON (South Australia) [3.18]. - The Minister of Defence will recollect that when the Excise Tariff Bill was under consideration, he showed me an amendment which was intended to fill up a gap in a proviso relating to the imposition of duties. I should like to know if that amendment has been inserted ?
Clause agreed to.
Clause 3 -
In this Act unless the contrary appears- “ Article of food or drink “ includes every article used for food or drink by man, and any article that enters into or is used in the composition or preparation of food, and also includes confectionery, spices,condiments, and flavouring substances. “Australian Standard Brandy” means . . . . “Australian Blended Wine Brandy” means brandy which complies with the following requisites -
It must have been distilled wholly from grape wine, and must contain not less than 25 per cent. of pure grape wine spirit, which has been separately distilled by a pot still or similar process at a strength not exceeding 40 per cent. over proof. “Australian Standard Malt Whisky” means whisky which complies with the following requisites : -
It must have been distilled wholly from barley malt by a pot still or similar process at a strength not exceeding 45 per cent. over proof.
Amendment (by Senator Playford) agreed to -
That after the word “ food,” line 5, the words “or drink” be inserted.
Senator Sir JOSIAH SYMON (South Australia) [3.22]. - I wish to ascertain whether my honorable friend, the Minister of Defence, thinks that it is better that an amendment which I intended to propose should be inserted in this clause or in clause 11. That clause provides that spirits distilled in Australia shall not be delivered for human consumption unless they have been matured by storage in wood for a period of not less than two years. I intend to suggest that that provision should be limited to the spirits comprised in the items 1 to 5 of the schedule of the Excise Bill, and that items 6, 7, 8, and 9 of that schedule, relating to methylated spirits, and spirits for fortifying Australian wine, be excluded from it. What I propose may be done by an amendment of the definition clause, by saying that spirits distilled in Australia for the purposes of clause 11, shall not include items 6to 11 of the schedule to the Excise “Bill, or it may be done by amending clause 11.
– I wish to point out to the Minister of Defence two amendments which will have to be made in the clause under consideration, in consequence of alterations made by the Senate in the schedule to the Excise Bill. With regard to the strength at which’ spirits shall be distilled, we have decided in the case of Australian wine brandy the strength shall be 40 per cent. When dealing with whiskies, we altered the strength from 45 to 35. I do not know whether there is any reason why the strength should be 40 per cent. in the, case of brandy and 35 in the case of whisky. It seems anomalous, unless some explanation can be given.
– The explanation given to me is that if brandy were distilled at such a low temperature as 35 degrees it would be very rough and harsh, and would take a long time to mature.
– It is provided further in clause 7 that a certificate is to be given to the distiller of spirits in accordance with certain forms. We all approve of the certificate to be given in the case of Australian standard brandy. But, regarding the next grade. Australian blended wine brandy, I ask the Minister whether he considers it worth while to issue a Government certificate to a brandy which is not our best? We are endeavouring to establish a stan dard brandy, and it is an excellent thing that the Government certificate should possess a certain value. To some extent, I fear that we shall impair the value of that certificate ifwe permit it to be used in connexion with “ Australian wine brandy.” For instance, it would be very easy for an unscrupulous person to put the word “ best “ before that name, and thus to make it appear that he was selling our best
– Whether “ Australian standard brandy “ is the best article that we can produce is a matter of opinion. The clause provides that it must be distilled wholly from wine at not more than 40 degrees over proof, whereas Australian blended wine brandy must be distilled wholly from grape wine, and must contain not less than 25 per cent, of pure grape wine spirit, which has been distilled at a strength not exceeding 40 per cent, over proof. The latter article may be mixed with any spirit which has been distilled at a higher strength than 40 degrees over proof. There is no doubt that such a blend makes a very excellent brandy. To the taste of the people, it is very questionable whether it is not equal to Australian standard brandy. When brandy is distilled at not more than 40 degrees over proof, there is sp much flavouring matter - so much in the nature of so-called impurities - left in it, that it takes a considerable time to mellow down.Indeed, it is very questionable whether it ever mellows in the same way as does blandy, a portion of which has been distilled at more than 40 degrees over proof. The vignerons in South Australia asked that provision should be made for the manufacture of a blended brandy. I recollect the evidence of Mr. Seppelt on the question, and I know that in a letter which he subsequently wrote to the Tariff Commission, he pointed out the desirability of permitting this particular brandy to be produced instead of confining distillers to one standard. Under the clause in its present form we shall practically establish two standard brandies, one of which will be known as “Australian standard .brandy,” and the other as “ Australian blended wine brandy.” The vignerons themselves have asked for this provision. They will be very particular that the spirit used in the
– I do not wish to pursue this subject any further if the Minister of Defence objects to adopt my suggestion. He must recognise that my only desire is that .we shall not weaken the value of our best brandy
– Both brandies will be distilled from grape wine.
– I am aware of that. At the . same time, I think it would be better if we removed all possibility of a blended brandy being sold as our best brandy, thus injuring our trade in the finest article we can produce. Australian blended brandy cannot be as good as Australian standard brandy. Otherwise, why should a heavier Excise be charged ?
– The honorable senator only objects to the issue of a Government certificate in connexion with Australian blended brandy?
– Exactly. I do not intend to press the matter to a division if Senator Playford is satisfied that by issuing a Government certificate in the way that is proposed, we shall not injure the trade in our best brandy.
– - I am inclined to think that we shall do well to retain the provision which has been made for the issue of a Government certificate to Australian blended brandy. It would at least afford some protection to that article. We must recollect that Australian standard brandy will probably be exported, whereas the ordinary brandy of commerce will be a blended brandy. Consequently, it is very important that we should provide for the issue of a certificate.
Senator Sir JOSIAH SYMON (South Australia) [3.38]. - I think it is rather unfortunate that we should ‘use the term “ standard “ as a part of the name of any brandy. In my opinion, we should merely call it brandy. The clause provides that it must be distilled wholly from grape wine, and that it must be matured and certified. Why, then, should we not call it “brandy”? It is par excellence brandy, and it is a pity to prefix the word “ standard “ to it. I know of no instance in South Australia in which the word brandy has been associated with an adjective of that kind. We all know what Australian brandy is. We desire to keep it pure-
– We shall have to retain the word “ Australian.”
– But we do notrequire to retain the word “standard.” Its use implies that we produce a variety of brandies. I think that Australian brandy ought to be the name associated with this particular result of distillation from grape wine. I ask Senator Playford to consider the matter, because at a later stage we may have an opportunity to recast the provision. I am sure that all those who are proud of the brandy which is produced in Australia - as we all are - will be gratified if the Ministerwill agree to eliminate the word “standard,” and to call our best production par exellence brandy. Then, in reference to “Australian blended wine brandy,” I desire to know why we should adopt a statutory name so long as that. I am not at all sure that the word “ blended “ ought to be employed. If we permit blended brandy to be sold under that designation, we shall be placing in the hands of dishonest persons an instrument by means of which they will be able to palmoff blended brandy on the public as the purest and best brandy. We know perfectly well that blended whisky is regarded as the best whisky. People have got it into their heads that “ blended “ spirits are the best and most palatable, and it is proposed to apply the word “blended “ to brandy, though not in the same way as the word is applied to whisky. In the case of this brandy it is intended to indicate to the consumer that the spirit is inferior - not really pure brandy. But that, I am sure, would not be the case.
– If the word “ standard “ is allowed to remain that certainly might be the inference.
– We all know that one of the attractive features of the advertised imported whiskies is that they are blended, and are, therefore, supposed to lie finer and better on that account. “ Blended “ in the case of whisky means the mixing of two or three different whiskies together; but that is not what is meant in the case of the brandy under discussion. What is meant in the latter case is a blended brandy consisting of 25 per cent. of grape wine spirit, the remainder being other grape wine spirit. In the one case, there is a mixture of whiskies, and. in the other case, a mixture of grape wine spirits. The intention is to indicate that the blended brandy is an inferior article, an article that is not made from pure grape spirit. Therefore, I suggest that in the interests of brandy-making in Australia, it would be as well to omit the word “blended,” and endeavour to substitute some other word, though what word should be substituted I am not prepared at the moment to suggest.
– I think Senator Symon is slightly under a misapprehension when he says that there is no necessity for the word “blended” and the word “standard” to remain. The object of these recommendations . by the Commission was thatthe standard brandy of Australia should be a brandy distilled from wine up to a certain strength, and that the blended wine brandy should be a mixture or a blend of brandy distilled up to a certain strength, and wine spirit distilled to a higher strength.
.- I regret very much that the Government have not seen their way to follow, as nearly as possible, the recommendations of the Tariff Commission with regard to these details. I do not for a moment suggest that there is any infallibility about the Tariff Commission, or any of its members; but I think that, when the Commission has, after a great deal of labour and consideration, arrived at a certain decision, the Government ought to respect that decision. In connexion with pure grape brandy the Tariff Commission suggested that the Government certificate should, in the first place, be “ Pure Australian Standard Brandy,” and that with regard to the blended spirit, the certificate should be “Australian Blended Brandy.” As to pure malt whisky, we suggested the words “ Pure Australian Malt Whisky,” and, as to blended whisky, the words “ Australian Blended Whisky.” Our idea was that the public would get to know that “ Pure Australian Standard Brandy “ was the purest article, and that the words “ AustralianBlended Brandy “ would convey that it was brandy of an inferior qualify.
– A departure from the standard.
– Yes, a departure from the standard. In all probability, not only the label, but the prices, would indicate the different qualities ; because we may take it that “ Pure Australian Standard Brandy “ would be1s. or 2s. per bottle dearer than “ Australian Blended Brandy.” The Government have omitted the word “ pure “ from the first label, and left it “Australian Standard Brandy,” and in the second label - the label which is to be attached to the bottle containing inferior brandy - they have inserted the word “ wine.” In my opinion, this is calculated to mislead the public in favour of the blended brandy. The label attached to the superior brandy would not contain any reference to wine, whereas the label attached to the inferior quality would contain such a reference, and so give people the impression that Australian blended wine brandy was better than Australian standard brandy. I move -
That before the word “ Australian,” line 8, the word “Pure” be inserted.
– It appears to me that the word “ standard “ is a valuable word, which should be allowed to remain in connexion with the highest quality of brandy that is made.
– Does the honorable senator not agree also to the insertion of the word T< pure “ ?
– I agree with that proposal ; but I am now dealing with the question of the retention of the words “standard” and “wine.” There is a general knowledge that real brandy is made from wine, although I believe there are very few people who care to drink this highest class of wine brandy. I think we ought to have the words “ Pure Australian Standard Wine Brandy,” and, to indicate the next quality, the words “ Blended Wine Brandy.” This would, in the first instance, show that we had established a standard.
– A pure standard.
– Yes, a pure standard, which would be the highest, and then it would follow that “ Blended Wine Brandy “ was a departure from that standard ; all the information that a certificate, should give would then be given. I do not think that the “ Pure Australian Standard Wine Brandy “ would be generally drunk, but it would be there if any people desired to have it.
– If the honorable senator’s suggestion does not make the name too long. I think it ought to be adopted.
– If the word “ wine “ is not allowed to remain in connexion with the first quality, it ought not to remain in connexion with the second quality, because people might easily be given the impression that “ standard “ brandy was not wine brandy, and that “ blended wine brandy “ was the better quality. I think that it would be better to adopt the language suggested by the Tariff Commission. The title is somewhat lengthy, but after all, for advertising purposes, a high-sounding name is desirable. If Senator Higgs would alter his amendment so that the definition would read “ Pure Australian Standard Wine Brandy,” I think it would be better.
.- This matter was not overlooked by the members of the Tariff Commission, and in preparing the terms of the proposed label, they had to consider the necessity for a brief and comprehensive title. They thought at one time of using the words “ Pure Australian Standard Grape Brandy “ ; but after discussion determined to omit the word “ grape.” Our desire was to give a monopoly of the word “brandy” to distillers of the pure article. The word “ brandy “ really covers everything that honorable senators desire to include by the use of the word “ wine.”
– Then we must, if we do not insert the word “ wine” in the first definition, omit it from the second.
– Quite so. Our desire was that the word “ brandy “ should be understood to cover spirit distilled from grape wine. It seems unnecessary to insert the word “wine “ in the first definition. The Commission were of opinion that in a very brief time the public would come to know that the label “ Pure Australian Standard Brandy “ covered the best brandy that could be produced in Australia. I agree with Senator Trenwith that the word “wine” in the second definition should be omitted. It is misleading, and, later on, I shall move its omission. We shall then have two labels: “ Pure Australian Standard Brandy,” covering the first grade, and “ Australian Blended Brandy “ applying to the inferior article.
– I am prepared to accept either Senator Higgs’ proposal or that made by Senator Trenwith. I agree that the word “ wine,” which appears in the second definition, must be omitted unless it appears in the first. The Government propose to use the word “malt” in describing a certain quality of Australian whisky, and that being so, I. see no reason why we should not use the word “ wine” in ‘the definition of brandy.
– - If I had my way I should strike out the words “pure “ and “standard,” in the definition proposed by the Commission. The use of the word “standard” conveys nothing to the public. They know the meaning of the word “ brandy,” and they understand what we mean when we declare that brandy shall be spirit distilled from the juice of the grape; but the word “standard” is mere surplusage. Why should we use the word “ pure” ? Are we going to allow the Commonwealth label to be applied to something that is impure? To my mind, the words “Australian brandy” are sufficient.
– The addition of the word “pure” would do no harm.
– It would serve no useful purpose. The fact that the Commonwealth label is applied to certain spirits will be sufficient to indicate to the general public that it is pure.
– We need To distinguish the pure brandy from the blended brandy
– That distinction is secured by the use of the word “blended” in the second definition. I agree with Senator Symon that, the word “standard” is unnecessary, and I also think that the word “ pure “ is not wanted. Our definition is “ Australian Standard Brandy,” and its purity will be guaranteed by the Commonwealth certificate.
Senator Sir JOSIAH SYMON (South Australia) [3.56]. - I agree that the word “ wine “ should be’ eliminated from the second definition unless it appears in the first. As a matter of fact, however, .it is quite unnecessary. I am confident that I am expressing the views of the brandy makers of South Australia, who have won the reputation of producing a pure article, when I say that we do not need a label with a long title. We might as well have the words “ Australian Brandy Pure and Simple “ as ‘’ Pure Australian Standard Wine Brandy.” These proposed additions may be mere trifles, but they are impediments to trade. . Long titles occupy much space on a label, and I suggest that the words “ Australian Brandy “ are sufficient. We ought to teach the people that they are applied to only the very finest brandy produced. I agree with the Minister of Defence as to the desirableness of eliminating the word “standard,” since it conveys nothing to the public. On the other hand, the use of the word “pure” would mean something to them, and, therefore, whilst I do not think it is necessary, I am prepared to agree .to its insertion in the definition. The certificate of the Government officer is an indication of purity, but still, as I have said, the word “ pure “ is intelligible, and conveys something to the consumer. We apply to the definition of the inferior article the word “blended,” and, although I do not like if, I recognise that we must have something to indicate that it is not pure Australian brandy. May I add that I recognise the care and attention of the Tariff Commission in dealing with this matter, and hope that the members of it will not think that our criticisms are uncalled for? If the word “pure” be inserted, I shall move the omission of the word “ standard.”
– I think that if we adopt the recommendation of the Tariff Commission, we shall act wisely. Surely no harm can be ‘done bv adding the word “ pure “ to this definition. Two or three qualities of brandy are made, and the use of the word “ pure “ will be a guide to the people.
– It might suggest that there was impure brandy made in Australia.
– The law allows two or three kinds to be made ; therefore it is right that the word “ pure “ should be applied to the first quality.
.- I do not think it would be wise to adopt Senator Symon’ s suggestion to leave out the word “ standard.” The honorable and learned senator is aware that in connexion with the export of Australian products such words as “ prime “ and “ best “ are applied to them for the information of customers. It is a common practice to apply such terms as “best” or “second best” to shipments of Australian butter, for instance. In the same way, I think we might very well adopt the term “ pure Australian standard brandy.”
– We should state what the standard is first.
– Once a departure is made from the recommendation of the Tariff Commission in a matter of this kind, it is likely that a mistake will be made. The Government made a great blunder when they left out the word “ pure “ in the designation of the best article, and included the word “ wine” in the designation of the inferior article. When a proposal of this kind is made to leave out one word and put in another, the difficulty is that amendments may be adopted which have been much more hastily considered than was the proposal of the Tariff Commission. I think the Committee would do well to follow the recommendation of the Tariff Commission in this instance.
– I wish to ask a question of Senator Symon. I am aware that it is not usual to ask for legal advice in this Chamber, and the honorable and learned senator might claim that, as my question raises a legal point, he should not answer it. Suppose we adopt the suggestion to designate the firstquality article as “Australian brandy,” and we have another under the description “Australian Blended Brandy.” It is possible that a man would be supplied with blended brandy when he expected to be supplied with pure standard brandy?
– “Australian brandy.”
– Yes ; but would not both be Australian brandies?
– Not according to law.
– I am very doubtful as to what the Courts of law might decide as to the meaning of “Australian.” They might decide that blended brandy would be Australian brandy, and there is no doubt that it would be, because it would be entirely composed of a distillation from wine or the lees of wine. I think it would be far better, in the interests of the public, to use the term “ Pure Australian Standard Brandy “ to indicate the article of first quality. If that were done, a publican could not excuse himself by the subterfuge that both were “ Australian “ if he did not give a customer the first-quality article. So far as the word “Australian “ is concerned, it might be argued’ that some Court of law would be prepared to decide that there is no virtue in its use in this connexion.
– Is there no virtue in the word “ Scotch,” as applied to whisky?
– I am not talking of whisky now, but of brandy. I think it would be in the interests of the public to insert the word “ pure “ in the designation of the article of first quality, and I should be prepared to agree to the insertion of the word “ wine “ in describing both articles, or to its omission from the designation of both.
– One of the most important objects of a label of this kind is to give confidence to the consumer. If the word “ standard ‘ ‘ is left out, and the definition is simply “Australian Brandy,” it may mean many things.
– The confidence” is given by the Government certificate. ‘ The public will not care what the label is if they have the certificate.
– They will never see the certificate, and they will know nothing of the provisions of this Bill.
– The certificate will be on the label.
– I do not think that the Government have in this case attached to the recommendation of the Tariff Commission the importance it deserves. ‘ The Commission very carefully considered what the label ought to be. It is clear that no harm whatever would arise from the adoption of the term “ Pure Australian standard brandy “ to indicate the article of first quality.
– “Pure” and “ standard “ would only be surplusage.
-It wouldgive thepublic confidence. If we described the article simply as “ Australian brandy “ the public would not have the same confidence in it that they would have if the designation implied that the article was up to a standard. With respect to the blended spirit, I think that the term suggested by the Tariff Commission, “ Australian blended brand”. “ is the best that could be adopted. If that term is used the public will know that it is a blended brandy made from spirit distilled from grapes, or the produce of grapes.
– I see no virtue in the use of the word “ standard,” because I am of opinion that it will convey nothing to the public. People will not ask for “ Standard brandy.”
– “Australian standard brandy.”
– Or for “Australian standard brandy.” I have less objection to the insertion of the word “pure,” because it is a recognised qualification of a term, and will convey something. I have some little difficulty about the term chosen to designate the blended brandy, which in the Bill is to be defined as “ Australian blended wine brandy.”
– It is proposed to eliminate the word “ wine.”
– The question has arisen whether “ wine “ should be inserted in one case and not in the other. I wish to give as reason why the word “ wine “ should certainly be inserted in the definition of the blended brandy. “ Australian blended wine brandy “ will indicate a superior class, of brandy. If the term “ Australian blended brandy “ were used it might convey the meaning that the spirit was com- posed of 25 per cent, of wine brandy and the balance of molasses spirit rectified up to a neutral’ standard.
– That would not be brandy,.
– That might be so. If the term “ Australian blended wine brandy “ is used it will indicate that the article is a blend of wine spirit, whilst if the word “wine” is omitted the term “ Australian blended brandy “ might convey to the public that, whilst 25 per cent, of the blend might be composed of wine spirit, the balance of 75 per cent, might he any kind of spirit, including molasses spirit, rectified until it has become neutral. I should prefer the word “ wine.” to be retained, because it will indicate clearly the constituents of the blended brandy, in my view it is necessary that the word “ wine “ should be retained, because of the use of the word “blended.”
Senator Sir JOSIAH SYMON (South Australia) [4.9]. - Senator McGregor was good enough to refer a point to me. The honorable senator put the case of a person asking for a bottle of “Australian brandy,”’ and I say that if he were handed a bottle of “ Australian blended brandy “ he would certainly not get what he asked for.
– If he asked for brandy he would get the blended brandy.
– Then lie would not get what he wanted. No one entering a hotel would ask for a pure Australian brandy. He would ask for Australian brandy. Of course, if he knew 1 he difference between pure and blended brandy, he need not take the latter if it were tendered to him for pure brandy.
– I do not like the word “ standard “ at all, though 1 think the word “ pure “ should be used; and that the label should read “ Pure Aus tralian wine brandy “ or “ Pure Australian grape brandy.”
– Pure brandy cannot be other than pure grape or wine brandy.
Amendment agreed to.
Amendment (by Senator Sir Josiah
Symon) proposed -
That the word “ Standard,” in the name “Australian Standard Brandy,” be left out.
– - I hope that the word “ standard “ will not be left out. Its use will indicate that our wine brandy has reached the highest level. Any quality which is below the standard is necessarily inferior, and if the certificate declares that our brandy is pure, and up to the standard, it will be a certificate worth having.
– The word “ standard “ is not used in the certificate. “Pure” covers everything. Why introduce a word into the label which is not used in the certificate?
– “ Standard “ is a word of common acceptance, conveying the impression that the Quality to which it is applied is the very best.
– We apply the term “blended” to any but pure brandy.
– It has been pointed out that the word “ blend “ - sometimes “ Royal blend “ - is used to convey the idea of excellence in the case of whisky. If we term our pure brandy “standard” brandy, it will be recognised as of better quality than a blend. Anything that is not up to standard must necessarily not be so good.
– What standard ?
– The Australian standard. No doubt the term “ pure Australian brandy “ is sufficient for the honorable and learned senator ; but there are a number of persons who do not think as clearly as he does, and to them the word “ standard “ would have an important significance. ‘ We are all anxious to create a high reputation for our brandy.
– Then ca.ll it “pure Australian’ brandy.”
– The word “ Australian “ should be retained ; but the word “ standard “ is also necessary to show that the spirit is of a quality such as the world ought to look up to with admiration, and perhaps with envy. The use of the word “ standard “ will show that the brandy is of the first quality. Brandy of second quality may suit the popular taste better, but standard brandy will be known to be the best brandy obtainable.
– Having determined to retain the word “ pure,” it is mere surplusage to keep the word “ standard.” Long labels are not desirable.
– I do not see any great objection to long labels. Advertisements are often drawn out to make them high-sounding and important. “ Pure Australian standard brandy “ is not an extremely long title - not long enough to be cumbersome or inconvenient.
– It is more than a man would want to say if he were in a. hurry for a drink.
– We should discuss this matter, not so much from the point of view of a man who wants a drink, as in the interests of the Australian export trade. In that connexion, I think that the word “standard” is of great value. Its use will indicate that the brandy to which it is applied is of the highest grade obtainable in Australia. I hope that the word will be retained, not only because the Tariff Commission recommend its use, but because it will be of value in connexion with our export trade.
Senator Sir JOSIAH SYMON (South Australia) [4.19]. - I like to see the loyalty with which the members of the Tariff Commission support its recommendations ; but I would point out to Senator Clemons that the use of the word “ standard “ will not signify that the spirit to which it is applied is of the highest quality that Australia, can produce.
– We do not apply it to blended brandy.
– No; but if “standard “ means of the highest quality of brandy that Australia could produce, I should say that it would be very useful on a label. It would mean thai it was applied to a brandy which had been distilled in a pot still not exceeding 40 per cent, over proof, matured for two years, and certified to be pure brandy. But mv honorable friend knows perfectly well that we might have an Australian brandy matured for twenty years, which was an infinitely superior article, and which was worthy of being called not standard, but the finest Australian brandy. What would the term “ standard “ mean in that case? I venture to think that my honorable friends are under a misapprehension. If we define the word “ standard “ to mean the very highest quality of brandy, matured for fifty years in bottle or wood, that is another thing. But just as one star differs from another in brilliance, so all our brandies would differ in quality. I was astonished to hear Senator Macfarlane, who is a very experienced merchant, trying, to support the definition.
– Because he knows.
– I know, too. South Australia is probably the State in which the initiative was taken in producing the very finest pure brandy from grape wine, and I believe that it has maintained its reputation to this day. I have nothing to do with its production.
– How long have the distillers in South Australia been makins it? 8
– For a great many years. Certainly, during the last twenty years, the South Australian distillers have been producing a very large quantity of the article. I know of South Australian brandy which is twenty and twenty-five years old. If my honorable friends tell me that by retaining the word “standard” in the definition, it would indicate that brandy two years old was equal to that brandy, I do not share their view. I am perfectly certain that brandy distillers in South Australia, who are proud of their article, are very averse to’ the use of the word “ standard “ for the reason that each of them has his own high standard. Of course, he must comply with the provision as to quality, namely that the spirit must be pure. But if he were compelled to put on his label the word “standard,” the brandies would be placed upon the same level no matter how old they might be.
– But by-and-by there will be such a demand that there will be no brandy over two years old.
– I do not agree with my honorable friend. A brandy distiller who wants to maintain a reputation will have a certain quantity which will be far more than two years old. My honorable friends would give him no encouragement if thev retained the word “standard,” and said that it should be applied to all that brandy. From a con- versation with the distillers, and from living in South Australia, I happen to know something about the trade. I know that, from the point of view I have put, the use of the word “ standard “ in the definition is regarded there as having no significance. I am quite with my honorable friends in endeavouring to secure that the article shall be pure Australian brandy. Although I do not think that it is necessary to use the word “ pure,” still that would be an indication to a man who was buying a case, or a bottle, or a glass of Australian brandy that he was getting a pure article. It is very important that we should maintain the Australian reputation for the quality of the article. The best way in which that could be done would be by making it known all the world over, without using the word “ standard “ or “ pure,” as Australian brandy which carried its own certificate on its face.
.- I think that the argument of Senator Symon is a little inconsistent. In the first place, he told us that there was no value to be attached to the term” standard,” but afterwards he said, “ Do not put in’ standard’ because if you do you will put some brandies on an equality with brandies twenty-five years old.’’
– What we are proposing to do is to create a standard of excellence in manufacture and not in maturing and age. It would be quite competent for the distillers in South Australia to add to the phrase “ Pure Australian standard brandy “ the words “ distilled in 1850” in order to indicate the age. I attach a great deal of importance to the use of the word “standard.” The declaration that’ brandy was up to the standard which the Act . prescribed would be an assurance to the purchaser, but the question of age is another matter which can be arranged by the distillers. We often hear of a person in the old world, when a son is born - it is not done so much here - laying down a cellar of wine not to be opened until he was twenty-one years of age. I am sure that it would be of immense importance to retain the word “ standard,” and that it would be valued by persons. Senator Symon urged at first that it was of no importance; but he is afraid now that it might be the means of putting a young brandy upon a. level with the very old brandy with which be is acquainted.
– All I say is that, “ Australian standard brandy “has not been defined.
– I do not suppose that Senator Symon means everything he says. He was trying to persuade honorable senators to believe that age, in this case, is everything. But he knows that if an inferior brandy were laid down for 100 years it would not then be so good as a superior brandy which was only two years old. The use of the word “standard” has nothing to do with anything of that kind.
– What is the standard? Where is it defined?
– The word ‘ standard “ is used with other words in the definition, in order to indicate to the public that the article was a brandy which had been distilled wholly from grape wine by a certain method, and had been stored in wood for not less than two years. Of course, good Australian brandy, if stored in wood for twenty-five years, would be probably better at the end of that time. But the question of standard has nothing to do with that matter. The standard is a minimum below which the brandy could not go in point of age and method of manufacture. I believe that a very large number of honorable senators hold that such an indication would be of some value to the public. I hope that it will be retained.
Question - That the word “ Standard “ proposed to be left out be left out - put.
The Committee divided.
Majority … … 17
Question so resolved in the negative.
Amendment (by Senator Clemons) proposed -
That the word “ Wine,” in the name “ Australian Blended Wine Brandy,” be left out.
– I sincerely hope that the Committee will not agree to the amendment. The word “blended,” unless it be associated with the word “ wine,” will convey to the public that the brandy is made of a blend of spirits distilled from two or more entirely different substances. What we wish to indicate is that the brandy is at least pure wine spirit. If we do not retain the word “ wine “ the public will conceive that the brandy is made partly, at any rate, of molasses, potato, or some other spirit mixed with wine spirit. Our object is to insure that the brandy shall be known to the public as distilled wholly from the juice of the grape.
.- I indorse what has been said by the. Minister. It is of the greatest importance that when we use the word “ blended “ we should associate with it the word “ wine,” in order that the public may know that the blend is made wholly of wine spirit, although produced bv different methods of distillation. We prescribe that 25 per cent, of the spirit shall be rectified up to 40 degrees over proof, and that, as regards the remainder, it mav be rectified to any extent that the distiller may consider desirable. Unless the word “ wine “ is retained, an entirely wrong conception will be conveyed as to the character. of the blend.
Senator Col. NEILD (New South Wales) [4.37]. - It seems that we are manifesting a verv large amount of virtuous enthusiasm over the manufacture of a pure article, and yet not1 the slightest guarantee will be afforded that the contents of the bottle, whatever they may be called, will reach the consumers in the form in which they have been manufactured. Unless some special care is taken in the oversight of the retail distribution of the spirit-
– That is the duty of the States. We are doing all we can.
– Very well, I have no objection to the manifestation of the’ fullest degree of virtue.
– - We shall place ourselves in a very peculiar position, if, after leaving out the word “ wine “ in our description of “ Australian Standard Brandy,” we retain it in the description of “ Australian blended brandy.”
It is proposed to insert the word “wine” in the description of the inferior article, and to leave it out in the case of the superior product, and my contention is thai if the word is used in one case, it should certainly be employed in the other.
– The honorable senator insisted upon retaining the word “ standard.”
– I did not understand that the use of the word “ standard “ would preclude us from using the word “ wine “ also.
– The word “ standard “ should have been struck out in the first instance, and the word “ wine “ inserted ‘in its place.
– But that course has not been pursued, and I see no reason why the word “wine” should be retained in this case. If the descriptions are allowed to stand as at present, the sale of the superior article will probably be prejudiced, because the public may think that Australian blended wine brandy is at least wine brandy, whereas the standard spirit mav not be.
– But it has to be certified as “ pure “ brandy.
– It .may be considered pure spirit, but distilled from something other than wine. Under the circumstances, we should stultify ourselves if we retain the word “ wine “ in the definition of Australian blended brandy.
Senator Sir JOSIAH SYMON (South Australia) [4.40]. - We are dealing with this. clause in such a way that when the Bill gets on- to the statute-book, whatever it indicates with regard to brandy, it will certainly indicate to those who’ know something about the subject that we in the Senate do not know much about it. Is there anything, permitted to be called brandy under the Excise Hill which is not made from wine?
– Then why put in “ wine “ ?
– I think it is ludicrous to have it in. If the Minister of Defence had assisted me to strike out the word “ standard “ in the previous definition, it might have been wise to insert “wine” in its place. But, inasmuch as, under the Bill, nothing is entitled to be called brandy that is not made from wine, the word ‘ ‘ brandy, ‘ ‘ whenever used on any of the labels, must of itself mean a spirit distilled from wine either under such conditions as entitles it to be called “ Pure Australian Standard Brandy “ - which is a pretty big mouthful - or “ Blended Brandy,” which is inferior. Nothing is gained by having the word “wine” in this definition. It may mislead, because some people may think that a blended brandy is better than a pure brandy. The word is superfluous. Furthermore, in the opinion of distillers and other persons in the trade, if we insert the word “ wine,” their customers, who do not know so much as experts in the business, will be inclined to think that blended wine brandy is made wholly from wine. A seller in a bar may say to a customer, ‘ ‘ You want Australian brandy, and you are prepared to pay the highest price for it ? Well, here is a pure blended wine brandy - none of your ‘ standard ‘ here.” And the customer will buy it, thinking he is getting the best. I quite agree that the word “wine” should be omitted.
– I hope that the word “wine” will be omitted. The difficulty is to find a term that will express precisely what we mean. I do not think that the English language is sufficiently copious to supply a word that will exactly define our intentions. Perhaps the correct definition would be “ Blended Wine Spirit.” But the public have certain ideas with regard to spirits of wine, and therefore that term would create confusion. If any honorable senator can suggest a better definition than “Blended Brandy” I shall be willing to consider it. The Tariff Commission spent some time in endeavouring to find the best term possible. I quite agree with what Senator Symon has said. If we leave in the word “ wine,” we shall mislead the public by inducing them to pass over the superior brandy and take the inferior. Everybody in Australia ought to know by now that no spirit is entitled to be called brandy that is not made from wine, or the lees of wine.
Amendment agreed to.
Amendment (by Senator Playford) agreed to -
That the figures “45,” in the definition of “Australian Standard Malt Whisky,” be left out. with . 1 view to insert in lieu thereof the figures “ 35.”
Senator Sir JOSIAH SYMON (South Australia)[4.49] I do not like the word “standard” as applied to malt whisky; but, as the Committee has agreed to retain it in the case of brandy, I shall not move an amendment.
Clause consequentially amended, and agreed to.
Clauses 4 and 5 agreed to.
Clause 6 -
The Distillation Act 1901 is amended as follows : -
by omitting from section 58 the words “ and of a strength of at least 30 degrees above proof in the case of wine spirit, and of at least 60 degrees above proof in the case of any other spirit.”
by omitting from section 59 the words “ thirty-five “ and inserting the word “forty” in lieu thereof; and
by omitting from section 76, paragraph [it) the words “ thirty-five,” and inserting the word “ forty “ in lieu thereof.
– This clause contains a proposal which, to my mind, is a little debatable. It is well, therefore, that the Committee should know that a difference of opinion exists in respect of it. It is proposed to allow spirit which is used for the purpose of fortifying Australian wine to be distilled - in the case of wine spirit - at up to 40 degrees over proof. The present Distillation Act limits the strength at which it may be distilled to 35 degrees above proof. Honorable senators will recognise that the higher the degree of strength at which spirit may be distilled for the purpose of fortifying wine, the greater must be the quantity of alcohol that is put into the wine. For my own part, I think that 35 degrees above proof is a sufficiently high limit to impose, and, perhaps, we may hear from an expert, who, in regard to these matters, is greater than a member of the Tariff Commission, whether it is desirable that we should allow spirit for fortifying wine to be distilled at a strength of 40 degrees over proof.
– I would point out to Senator Clemons that the increased strength at which it is proposed to allow spirit to be distilled for the purpose of fortifying wine has been adopted as the result of a request on the part of the vignerons themselves. I supported that request, because no vigneron will fortif y wine with a spirit that it takes 4 or 5 gallons of wine to distil, and then sell that fortified wine at the same price as the unfortified article, unless there is a necessity for it. If there be a necessity for it, why should not the vignerons of
Australia be afforded nearly the same opportunities as are extended to wine-makers in other countries ? I think it was very wise on the part of the Tariff Commission to recommend this proposed increase.
– They did not all recommend it.
– - This clause specifies the degree of strength at which spirit for fortifying wine shall be distilled. But it appears to me that, in this matter, we ought to consider the interests of the general public. The clause proposes an amendment as to the quantity of proof spirit which may be put into Australian wine. The Distillation Act of 1901 provides that no person shall sell any Australian wine containing more than 35 per cent, of proof spirit. The present proposal is to increase that amount to 40 per cent. I do not know what may be the interests of the vignerons, but it seems to me an important matter when it is proposed that Australian wine, which is being sold to the public, shall contain 40 per cent, of proof spirit. I repeat that I do not know what may be the necessities of the trade, but I recognise that this is a proposal to enable Australian wine to be sold to the public at a greater alcoholic- strength than hitherto. Unless some very strong reason can be advanced from’ the stand-point of the makers of wine we should hesitate before agreeing to the change.
– Section 59 of the Distillation Act provides -
No Australian wine shall be fortified under this Act so as to contain more than 35 per centum of proof spirit.
Under this clause the percentage of proof spirit which it may contain will be increased to 40. In other words, we shall allow Australian wine to contain up to 40 per cent, of proof spirit.
– That is pretty heavy.
– It is. I think I am right in saying that the object of this proposal ls-to induce Australian wine-makers to undertake the manufacture of heavy wines such as port. Their contention is that unless they are allowed to fortify it up to 40 per cent, of proof spirit they will be unable to compete with imported ports. Personally, I wish that they would not attempt to do so. I believe that the future of the industry depends upon the production of the lighter classes of wine.
Only one or two wine-makers who appeared before the Tariff Commission expressed any desire to go in for the manufacture of ports. I believe that the great majority of them prefer to make light wines.
– In South Australia we are making ports.
– And some of the vignerons there are making bad ports. The fact remains that we cannot make a port of good quality in Australia. Under cover of this proposal, the wine-growers will be enabled to compete, so far as alcoholic contents are concerned, with imported ports. Except in the case of port, nobody wants to fortify wine up to more than 35 per cent.
– What about sherry ?
– I do not think that sherry ought to contain more than 35 per cent, of proof spirit. In the best interests of Australian wine-growing, we should discourage the fortification of wine with spirit of a high degree of alcoholic strength.
Senator Sir JOSIAH SYMON (South Australia) [4.59]- - I am very glad that attention has been called to this matter. I am inclined to agree with Senator Clemons that it is verv undesirable that we should extend the opportunity to fortify Australian wine up to 40 degrees of proof spirit. We ought in every way we can to restrict, rather than extend, the facilities for fortifying our wines. In the case of Australian wine the great ‘ difficulty which has to be contended with is its natural strength. I do not think there is any need whatever to provide opportunities for increasing that strength. The finest Australian wines are the lightest. We have no desire to restrict their production. It is nonsense to urge that imported wines are of an alcoholic strength of 40 degrees of proof spirit. There is very little df that class of wine imported. We all recognise the danger that exists of wine being placed upon the market in a rough-and-ready way, and made palatable by being highly fortified. I think we should be acting wisely in the interests of consumers if we were even to place impediments in the way df that happening, rather than to give increased facilities. If we were to’ give liberty to fortify to 40 Der cent, over proof, we should, in my opinion, be making a very great mis- take from the point of view of the winegrowers and producers.
Senator Col. NEILD (New South Wales) [5.1]. - I remind the Minister of Defence that a few days ago, when we were discussing the Canteen Bill, he announced his intention to issue regulations abolishing the -use of spirits in canteens, and restricting the members of the Forces to beers and wine. If the honorable gentleman carries out that intention, and yet, at the same time, succeeds in passing the clause now under consideration, he will provide a tipple that will enable the soldiers to “ go on the tare “ just as readily as with any watered whisky or other spirit provided in the ordinary way. It is well known that one of the difficulties which have beset the introduction of Australian wines to the British market has been their high strength. It would be infinitely better, and more calculated to facilitate the sale of Australian wines in England, if wines of a lighter character rather than those of the exceedingly heavy mature suggested by this proposal were offered to the British wine-loving public. If the Minister of Defence is going to permit the use of these heavy wines in the canteens, he cannot hope the result to make for sobriety, having regard to the strength of the whiskies in ordinary consumption. I agree with Senator Symon and other honorable senators who have urged the reduction of this exceedingly high strength.
.- The report of the Tariff Commission is plainly in favour of permitting fortification up to 40 per cent.
– The Commission was not unanimous on the point.
– On page 13 of the report of the Tariff Commission No. 2, references are made to this subject. I do not know that I need read all those references, but I may say that it is pointed out that, so far as the consumption of wine within the Commonwealth is concerned, fortification up to 40 per cent, is not necessary. As pointed out by Senator Mc’Gregor, it does not pav to fortify wines up to the degree mentioned. It is unprofitable, as adding to the cost of production, to extract a gallon of spirits out of some 5 gallons of ordinary wine, and to use that spirit for the fortification of other wines up to 40 ner cent. I can assure Senator Neild that there is no danger of those highly fortified wines getting into the military canteens, except, of course, ports and sherries, which must be fortified to a certain degree. We must recollect that now the whole of the spirit used for the fortification of wine must be distilled from the grape, and that is a very expensive form of distillation, seeing that a gallon of spirits cannot be made under 4s. 6d. As has been pointed out, however, if certain Australian wines are to compete in England they must be fortified up to 40 per cent.
– That is a great mistake.
– It is not necessary to fortify to that extent the wines intended for the English market.
– Not claret.
– Nor hocks and chablis.
– But there are ports and sherries.
– Here-is a statement of the Tariff Commission on page 13 of their progress report No. 3 -
The wine wanted for export must contain at least 20 per cent, of alcohol, and must be a heavy-bodied, fruity wine. - (Q. 1841). A few years back growers and merchants used to ship red dry wine, but now the leading merchants told them that they wanted fruity burgundies. They had not been able to get the London market for ports, because they had not been allowed to fortify them up to 40 per cent.
Here we have the reason why 40 per cent, is recommended. A little lower down, we read -
If Australia is going to open up large markets in other parts of the world, it will be necessary that its wines should be fortified up to thi: standard of well-known European types, such as ports and sherries, which contain 40 per cent. Fortifying up to 40 per cent, is not required in Australia for internal use to anything like the extent it would be required in opening up an export trade. - (Q. 1712).
If this is a digest of the evidence, it is in favour of allowing fortification up to 40 per cent, upon the assumption that we desire to encourage the export trade. It is admitted that such fortification is not necessary for the Australian market; and, in any case, 40 per cent, is the maximum. I think we should be wise to allow the clause to pass.
– The Minister has just told us that there is no danger of wine being too highly fortified for consumption in Australia, because it does not pay the producers to fortify it to the extent of. 40 per cent. But section 58 of the Distillation Act is as follows : -
Unless otherwise prescribed no spirits shall be used for fortifying wine unless they are approved by the officer and of a strength of at least thirty degrees above proof in the case of wine spirit and of at least sixty degrees above proof in the case of any other spirit.
– That deals with the character of the spirit to be used in fortifying; we are now talking about the strength to which wine may be fortified.
– The Minister told us just now that there is no danger of the over-fortification of wine, on account of the cost of making the spirit, which has to be produced from grape wine. I am showing that in section 58 of the Distillation Act, there is provision for two different kinds of spirit to be used for the fortification of wine, and that one of those spirits may be distilled from any material whatever. My desire is to point out an apparent inconsistency, which no doubt can be explained. The’ next section of the Distillation Act is -
No Australian wine shall be fortified under this Act so as to contain more than thirty-five per centum of proof spirit, nor with any other spirit than pure wine spirit of a strength of at least thirty degrees above proof.
What is the spirit referred to in section 58 ? There is a provision that wine may be fortified with any spirit - with silent spirit distilled from molasses. It costs 6cl. per gallon, and under this Bill there will be a duty of only 6d. per gallon upon it, so that, as far as the question of expense is concerned, there would be no obstacle in the way of the excessive fortification of wines. In the interior, astonishing though it may seem, many people regard colonial wines as nonintoxicating. A great many people in the bush, who call’ themselves teetotallers, are prepared to take a glass of colonial wine, being under the impression, apparently, that it is non-intoxicating. Honorable senators are, doubtless, aware that in nearly all the States colonial wine licences are issued, and that the holders ofl them are not under the complete supervision to which publicans are subjected. It is considered that those who sell colonial wine vend a liquor which is not so fiery and dangerous as spirits. In tea gardens and other pleasure resorts there are shops or booths for the sale of colonial wine, which is regarded as a. comparatively innocent drink; but under this Bill wines sold at such places may contain 40 per cent, of proof spirit.
– At the present time they may contain 35 per cent.
– I fail to see why the maximum should not be reduced to 30 per cent. The fact that wine may be fortified at the present time to the extent of 35 per cent., affords no ground for the proposal to increase the limit to 40 per cent. The Minister has told us that the alteration is necessary to enable certain vignerons to produce a wine that will compete with the imported article. As a matter of fact, there is no attempt in the Bill to discriminate between colonial wine, as ordinarily understood, and that for which he desires an extension of the provision with regard to fortification. I think that the proposal is a most dangerous one.
– The statement made by the Minister of Defence, that there was a general desire on the part of wine-growers examined bv the Tariff Commission that we should allow wine to be fortified to the extent of 40 per cent., was not quite accurate.
– A good many expressed that view.
– Many of the winegrowers examined bv the Tariff Commission had grave doubts on the point. For instance. I find, on referring to the report of the Commission, that Mr. de Castella, one of the best wine-growers in Victoria, said -
If a wine only contains 23 per cent, of alcohol, and is fortified up to 31 per cent., it will never ferment any more ; it requires the addition of 10 per cent, of alcohol -
That is over and above 23 per cent, of alcohol - in order that it may be kept.
In other words, he considered that if wine contained 33 per cent, of alcohol it could be safely kept. That being so, fortification to the extent of 35 per cent, should be sufficient. One of the most capable witnesses before the Commission was the Victorian Government Viticultural expert, Mr. Burney, who said -
If the wine were not fortified up to the extent of 32 per cent, or 35 per cent, of alcohol, it would probably ferment and become undrinkable.
He did not say that it should be fortified to the extent of 40 per cent.
– He is not an exporter of wine.
– But he is an expert.
– The honorable senator should question such makers of port wine in South Australia as Mr. Smith, of Yalumba.
– With every respect to the vignerons of South Australia, I may say that we had no more competent witness to advise us than the Government expert of Victoria.
– Does the Minister merely desire that permission shall be given to fortify wine up to the point at which fermentation will cease, or does he wish permission to be given to fortify up to the point necessary to make it popular abroad? From, his interjection, I think that he !vis the latter object in view.
– There may be something in that. Mr. V. R. Gosche, of Sydney, manager for Thos. Hardy and Sons, dealt with the necessity for fortifying wine to prevent fermentation, and said that -
Fortification up to 30 or 32 per cent, is necessary on this account. The Act fixes the limit at 35 per cent., which I think is rather excessive; hut we have nothing to say against it, as it allows a margin.
I do not think it necessary to make further quotations from the. report. I have shown that three competent witnesses were evidently of opinion that fortification up to 35 per cent, was sufficient. If we allow wine to be fortified up to 40 per cent., it will be sought after chiefly .by those who desire a strong alcoholic drink. I do not think we desire to encourage the production of wine for that purpose.
– We desire to encourage the export trade.
– My own view of the- evidence given before the Commission is that it shows that Australia will not make a name for her wines abroad by exporting such highly fortified wines as sherries and ports.
– An immense quantity of port from Portugal and Spain is consumed in London. It is all fortified up to 45 per cent.
– It is not so highly fortified.
– I do not think it is. If Australia is to gain a name abroad for her wines, she must export the better class of light wines which do not need to be fortified up to 40 per cent.
– There is no great demand for light wines in England.
– There is. The great bulk of our export trade relates to claret and the light burgundies.
– In England, the greatest demand is for light wines, and not for ports and sherries.
– Not ports and sherries, but heavy burgundies.
– Of which class of wine does the Minister expect the public to consume the largest quantity? Does he expect them to favour port, a tumblerfull of which no man can safely drink, or the light wines which may, or ought to be, drunk with impunity?
– Everything depends upon the thirst of the man.
– It would be a strange thirst that would require a tumbler of port to satisfy it. I am afraid that if the honorable senator were to take a tumbler of port he could not continue to conduct the proceedings of the Committee, though he might be able to take a quart of Australian light wine, and be all the better for it. If fortification to the extent of 40 per cent, overproof is allowed, Australian vignerons will, from my point of view, be turning out. a wine containing an excessive amount of alcohol, whilst if we cut down the strength overproof to 35 per cent., as I think we should, we shall do something to secure the manufacture in Australia of good light wine which, I think, this country can best produce. I move -
That paragraphs b and c be left out.
Senator Sir JOSIAH SYMON (South Australia) [5.22]. - No one will say that I am likely to be loth to do everything possible to increase the production of Australian wines, not merely for local consumption, but also for export. I believe the wine industry to be most suitable to Australia. I have strong enthusiasm for its extension, and I believe that it should be extended . in every possible way, and that markets for it should be sought everywhere. I regard every increase of the 35 per cent, to which, under the Distillation Act, Australian wine may be fortified as extremely dangerous. I am glad to have heard the quotations made from the evidence given before the Tariff Commission, because they support mv own view that it is entirely unnecessary that there should be any increase beyond the 35 per cent, now permitted. Honorable senators will recollect that that percentage was arrived at in 1901, after a great deal of investigation. I know that the then Minister of Trade and Customs, Mr. Kingston, took an immensity of trouble in his efforts to fix a fair and safe limit, and he reached that eventually in the provision made for fortification to the extent of 35 “per cent, over proof . The object of fortifying wine is to prevent the possibility of a fresh fermentation. That is all. You do not fortify wine in order that you may supply to consumers a blend of wine and spirit.
– Because you would not get the price for it.
– That is quite true, but we have heard of people drinking a mixture of port wine and dark brandy for certain complaints. That, however, does not indicate the object of fortifying wine. The sole object is to prevent the possibility of a second fermentation. The question is: How can that be accomplished ? It was determined when the Distillation Act was passed that, to permit of fortification, to the extent of 35 per cent, over proof would be sufficient to prevent wine going bad by a second fermentation, and also to allow some margin. The evidence taken by the Tariff Commission establishes that absolutely. One witness said that 32 per cent., and another that 33 per cent, would be ample, and the representatives of Hardy and Sons Limited, the great wine producers in South Australia, stated that 35 per cent, was more than sufficient, but as it allowed a margin it might be considered a fair thing. There is, therefore, no necessity for the proposed increase. If the object of the increase be to enable people to obtain a blend of wine and brandy to drink, it ought not to be encouraged or even tolerated. The high natural strength of our Australian wines usually preserves them from a second fermentation, if they are properly fermented and made in the first instance.
– That is without fortification at all.
– Yes. I mav tell honorable senators that the improved methods and equipment of the vignerons enables this to be accomplished without any difficulty. However, in the case of the heavier class of wines exported, we cannot always trust to that, and it is necessary that spirit should be used not merely for. the purpose of making .port or sherry in the ordinary way, but for the purpose of making it travel, so to speak - of protecting it from fermentation in transit. But we do not require the opportunity to fortify up to 40 per cent, over proof for that purpose. The statement is made that wines of this class imported to Australia are between 35 and 40 per cent, over proof, but even if that should be so, we should not permit Australian wines, merely for the purpose of enabling them to compete with such, wines, to be fortified up to that extent. The danger is that, by this provision, we should allow immature and inferior wines to be made palatable to a certain class of consumers by the introduction of spirits to an extent which would overpower what we might call the wine quality of the liquor, and produce an exceedingly deleterious article. The Minister of Defence has said that the cost would be a safeguard against that being done unduly. We know that it has been done, and that many of .the wine-shops have, in consequence, been a curse to the country. Much as I desire the wine industry to be extended, I cannot help saying that many of the wine-shops have done great injury, simply because they” “have encouraged the sale of immature wines which have been fortified to a high degree. The Minister says that the production of this wine spirit would cost about 4s. a gallon, but that would mean that six bottles could be produced for 4s., and if the quality of the wines is diguised and overpowered by the introduction of strong spirit, we know what the consequences must be to those who consume them. I object to the proposal, because I agree with the evidence given to the Tariff Commission that it is not necessary, in the interests of winegrowers, and because it is calculated to be dangerous to the wine-growing industry itself and to the community in country districts, where it is difficult to control the quality of the liquor retailed to the public. I venture to think that we should avoid any increase of the 35 per cent, provided for by the Distillation Act if we desire to do the best we can for Australian wine production. If a case can be made, and none has been yet, for the fortification to the extent proposed of wines of a particular class for export, the provision should be administered with great care and under very special restrictions. In connexion with some statements which have been made, I may say that I happen to know that the bulk of the consumption of Australian wines in the old country has not been of sherries and ports.
– Because we have never been able to send them.
– We have been able to send them, but we cannot compete with the continental wines of that class, which are up to a standard almost unchallengeable. We can produce hock, claret, chablis. and other light wines of that kind to compete with any light wines of European production. It is Australian wine of that class that is most largely consumed in England - with this qualification, that there is also a very considerable consumption of Australian fullbodied red wines, a medium between a fullbodied claret and burgundy, but I may tell honorable senators that such wines are sent to the merchants, who blend them, very often with wines that have never seen Australia at all. Therefore, we should be very careful what we do.
– -I sympathize with the view presented by Senator Symon, though I have to confess to a very large amount of ignorance about this subject. I have held the opinion, from what I have heard from wine drinkers, that one of the complaints against Australian wines is that they are too highly alcoholic.
– That has been one of our greatest drawbacks as a wine-producing country.
– I am at a loss to understand how that affects the trade. When I was in England a few years ago, Australian wines were being extensively advertised all over the United Kingdom, and I concluded very largely used, because the advertising must have cost many thousands of pounds. Unless the Minister can say something which will alter my mind, I am disposed to vote for the amendment, so that the degree to which wines may be fortified shall not be increased ; but I hesitate as to what I should do, because of an interjection made by him that it is necessary for export purposes to fortify up to 40 degrees. I do not know whether, by refusing our vignerons the right to fortify to that strength, we may not be limiting their market. Senator Symon referred to heavier wines. He did not say whether they are more highly fortified, or naturally more alcoholic.
– Does the honorable senator refer to Australian wines ?
– To wines used in England which do not come from Australia.
– I cannot say what the strength of spirit in some of the heavy ports is, but I should think about 35 degrees. That is not due to fortification; it is natural to the wines.
– I am of opinion that we ought not to do anything which would .tend to bring about the sale of wines of high alcoholic strength. If we can get sound wines, it is better to have them of a low alcoholic strength.
– A number of the witnesses examined by the Tariff Commission urged that they should be allowed to fortify up to 40 degrees, as the following resume of the evidence shows : -
The wine wanted for export must contain at least 20 per cent, of alcohol, and must be a heavy bodied fruity wine. A few years back growers and merchants used to ship red dry wine, but now the leading merchants told them that they wanted fruity burgundies. They had not been able to get the London market for ports, because they had not been allowed to fortify them up to 40 per cent. It was not urged that the more heavily fortified wines are at present exported, but that wine of a certain standard of strength was required for that purpose. If Australia is going to open up large markets in other parts of the world, it will be necessary that its wines should be fortified up to the standard of well-known European types, such as ports and sherries, which contain 40 per cent. Fortifying up to 40 per cent, is not required in Australia for internal use to anything like the extent it would be required in opening up an export trade. It is difficult to send to London market, in a fit condition, wines which are not properly fortified, because they have to be taken through the tropics. Some ,of the Australian light wines of low alcoholic strength are not suitable for the London market, and to produce wines of a greater strength than 20 per cent, in many districts of Victoria, they must be fortified. Australian vignerons have no chance of competing in Great Britain against the light wines of France, unless Great Britain imposes a very heavy preferential duty in their favour.
– That is altogether wrong.
– For four years the South Australian dep6t in London was under my control, and I know that we had practically no sale in light wines. It was wines like heavy burgundies that we managed to sell.
– That is, full-bodied and fruity ; but not fortified up to 40 degrees. °
– I do not say that we should fortify our burgundies to 40 degrees ; but if we wish to build up an export trade in ports, for example - and the most magnificent ports I have tasted have come from the Angaston district of South Australia - our vignerons must be allowed to fortify to 40 degrees, which is the strength at which these wines reach England,, and the strength at which ports and sherries reach the Australian market.
– Only very few.
– The present standard of fortification is 35 degrees, so that what is proposed is an increase of only 5 degrees, and for our export trade alone. High fortification will not take place in connexion with wines sold locally, because of the expense.
– We have reduced the Excise on spirit used for fortifying wines. That will encourage wine-makers to fortify.
– I hope that the Committee will accept the Bill as it stands.
– I intend to adhere to the subclause. Senator Trenwith seems to entertain a doubt as to their effect. The Minister has indicated from his experience the kinds of wine which are most likely to take the market in England, and it is the manufacturers of such wines who are advocating the enactment of the provision. I wish to show Senator Trenwith the ab- . surdity of the idea that wine-makers would fortify wines more than they could help. The Distillation Act provides that Australian wine must be fortified with, spirit distilled from wine. According to all the information I could get, Australian wines naturally contain from 15 to 20 per cent, of alcohol. If a man wanted to make a gallon of wine spirit, and the wine from which it was to be made contained 20 per cent, of alcohol, and that is pretty highhe would need to use 5 gallons. The price of wine generally ranges from 9d. to is. per gallon ; while an inferior wine might cost as low as 7d. If a man required a good spirit, it must be made from a good wine. Using wine that was bought at is. a gallon, it would cost 5s. to make a gallon of spirit, and to that must be added the Excise duty of 6d. If a man wanted to fortify 10 gallons of the same priced wine, he .must use 4 gallons of spirit, for that is the proportion which the provision as to fortification up to 40 per cent, allows.
– No; because there is already some spirit there.
– I am only giving the proportion. Of course, in a quantity a man must allow for the spirit which was already in. the wine.
– Then it would take only s. gallons of spirit for the quantity of wine referred to?
– Suppose that it did, then the 2 gallons would cost 9s. Taking the 10 gallons of wine at is. each, and the 2 gallons of spirit at 4s. 6d. each, the total cost would be 19s., whereas 12 gallons of wine would cost only 12s. Is it likely that a manufacturer of this class of wine would use that quantity of spirit unless it was absolutely necessary ? There was a time in Australia when a wine-maker could .fortify his wine with a spirit that did not cost much more per gallon than the wine itself.
– Not quite so much in some instances.
– Exactly. A gallon of molasses spirit used to cost from 9d. to is. A wine-maker could then profitably fortify wine up to 50 per cent., but under our legislation he cannot do that now, and that is where the safety comes in. If men like Mr. Smith, of Yalumba, and Mr. Salter, and others in the Angaston district, say that, in the interest of the class of wine which they make, fortification up to 40 per cent, is not too high, then, having regard to the cost, I think that it would be only just to such men to give them the opportunity to fortify up to that limit. I wish to say a few words about the wine which we are told makes people drunk. Wine is made containing 20 per cent, of proof spirit, and then 10 per cent, more is added, bringing the total percentage up to 30 per cent. That indicates the ‘danger which a person runs in drinking the wine. It only ap- plies, however, to a very cheap wine. It is not likely that a wine-maker would fortify a cheap wine up to 40 per cent., when 25, or 26, or 28 per cent, would be quite sufficient, and that percentage would make a man quite as drunk as he desired to be. Heavy, rich wines will not keep unless thev are fortified, and a large percentage of alcohol is required in order to prevent the second fermentation. That, I believe, is the reason which induced the Tariff Commission to recommend that the percentage of fortification should be increased from 35 to 40 per cent.
– I desire to give honorable senators a little more information on the subject. I propose, first, to quote Mr. Daniel Ferguson, Senior Inspector of Excise for Victoria, as to the alcoholic strength of wine- 2028. I suppose that wine containing more than 40 per cent. of proof spirit is practically spirit ? - A glass of wine containing 35 per cent. of proof spirit would consist of more than onethird of proof spirit.
– The public do not know that.
– That is the position which, I think, has sometimes been overlooked. We have to recognise that, if wine were allowed to be fortified up to 35 per cent., a consumer of the wine would drink one-third of proof spirit.
– Even strong whisky is 17 per cent. under proof.
– Yes. I desire to give some information on the question of fortifying up to 35 or 40 per cent., as tested by the importations. In reply to question 2034, Mr. Ferguson said -
The consignments tested at the Customs House during 1904 for alcoholic strength amounted to 11 hogsheads, 219 casks, 137 quarter-casks, 17 octaves, and So cases; but the only consignments which exceeded a strength of 35 per cent. proof spirit were 33 casks, of which 12 still remain in bond ; 15 quarter-casks, of which 1 still remains in bond; and 25 cases, of which 6 still remain in bond.
That is to say, a very small proportion of the imported wines contain over 35 per cent. - 2035. How many gallons were there containing more than 35 per cent. of proof spirit? - I do not think more than 2,000 gallons.
In view of that fact, surely it is not desirable to allow Australian wine to be fortified above 35 per cent. - 2037. By Senator Playford - I understand that most of the casks contained only a few points over 35 per cent. of proof spirit? - Yes. 2038. Do you think that the quantity imported containing over 33 per cent. of proof spirit would seriously affect the local industry? - No.
– Mr. Ferguson was an official witness ?
– Yes, and he told the Commission quite plainly, in answer to those questions, that the quantity of imported wine, which is supposed to he heavy and strong in alcohol, over 35 per cent. is extremely limited.
.- It appears that the Minister, in estimating the cost of producing spirit for the purpose of fortifying wine, had in his mind the cost of distilling spirit from grape wine for the manufacture of brandy. I find that under section 54 of the Distillation Act, spirit for the fortification of wine may be made from wine or lees of wine. One of the witnesses, at question 36291, said that vignerons under their licences were allowed to distil spirit “ from the lees of wine, skins, or other refuse.” I presume that spirit distilled from such refuse would not cost as much as spirit distilled from grape wine for brandy-making purposes.
– But the quantity of lees is extremely limited. I have made tens of thousands of gallons of wine, and have also distilled spirit.
– In any case spirit made from refuse such as I have described, would cost less than 4s. per gallon, and as the Excise duty amounts to only 6d. per gallon, we cannot look to the expensive nature of the spirit as a deterrent to its use for fortifying purposes. Our Australian wines are already fortified to a degree that is undesirable. One witness, Mr. Peter Urquhart, of Western Australia, said that it would be neither necessary nor advisable to fortify wine up to 40per cent. of proof spirit. The Minister has told us that it may be necessary to fortify some wines up to that degree, in order to produce an article similar to the heavy ports introduced from abroad.
– Some of the high-class ports contain 40 per cent. of proof spirit.
– The fact that some of our vignerons desire to produce a highclass wine of similar character to that imported, does not seem to me to afford sufficient warrant for permitting wine-makers to fortify their wines to a higher degree than at present, and to place upon the market a still more intoxicating article than is now being sold. I think that this proposal should receive the fullest attention of those senators who took such an interest in the Canteen Bill. The danger to which I have referred seems to me to outweigh all other considerations.
SenatorMACFARLANE (Tasmania) [5.54]. - Witnesses connected with the wine industry have expressed conflicting views with regard to the question now under discussion and, judging from the remarks made by honorable senators, there is no evidence to show that it would be advisable to increase the alcoholic strength of wines up to 40 degrees of proof spirit. When I was in Paris in 1889, a South Australian sample took the first prize for light white wine, and there was a very large demand in France for wine of that character. The complaint made to me was that dealers could not obtain a sufficient quantity of the good South Australian light wines, and I think that our vignerons would do better to aim at producing prime light wines suitable for the French market, rather than heavy wines such as are in demand in England.
Question - That the words proposed to be left out be left out (Senator Clemons’ amendment, vide page 5181) - put. The Committee divided.
Majority …… 4
Question so resolved in the affirmative.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 7 consequentially amended and agreed to.
Clause 8 agreed to.
Clause 9 (Penalty for describing spirits contrary to Act).
Senator Sir JOSIAH SYMON (South Australia) [6.4]. - Sub-clause 2 makes it clear that the Committee acted rightly in omitting the word “ wine” from the definition of “ Australian Blended Brandy.” It will be seen that the clause provides that any one who describes spirit as brandy when it is not wholly distilled from grape wine is liable to a penalty of
Clause consequentially amended and agreed to.
– I move-
That the following new clause be inserted : - “9a. No spirit described as brandy shall, after the first day of March, One thousand nine hundred and seven, be delivered for human consumption until the Collector is satisfied by the production of an official certificate given in the country of origin that the spirit is distilled wholly from grape wine.”
We propose to make it abundantly clear that spirit must not be imported, and sold as brandy, unless it is made from grape wine. Our object is, of course, to secure that our pure Australian brandy is not hampered by having to compete with inferior imported spirit. In this respect, we are to some extent following the example of Great Britain, which now insists that brandy shall be accompanied by an official certificate. The information supplied to me shows -
In France at the commencement of the operation of the law of 31st March, 1903, it was decided that pure grape wine brandies should be accompanied by a white certificate, entitled “ Certificate for pure wine brandies.”
Brandies to be accompanied by this certificate, must be followed by the administration of French Indirect Taxes in order that it may be able to guarantee that they do not contain any other substance than wine spirit.
The English Government knowing this detail, at the commencement of the law mentioned above, have especially relied, in judging of the value of a brandy, upon the presence or absence of the certificate mentioned.
As a result the producers of genuine pure grape wine brandy have not been disturbed by the decisions of the English Customs.
Our Customs House officials will accept a similar certificate from the French authorities respecting brandy that is imported into this country.
.- While I thoroughly indorse what the Government proposes, I am not satisfied that the words “official certificate” will not offer impediments to the importation of pure grape brandy. I quite agree that we should take precautions against the importation of inferior spirit described as brandy, but I am sure that the Minister does not wish absolutely to prohibit the importation of pure brandy. The term “official certificate “ is a little vague.
– An official certificate is accepted in England.
– Is that embodied in an English Act?
– I think so.
– In the same words as are used in this clause?
– I do not say that. Brandy from France imported into England must be accompanied by a certificate in order that the importers may be able to guarantee that it is pure wine spirit. The certificates are signed by French officials, and are accepted as proof that the brandy has been made from wine. We shall be prepared to accept similar certificates. Of course, samples will be taken in addition, and if any spirit is not in accordance with the certificate, it will be rejected. We shall not depend entirely upon the certificate.
.- I still feel that the term “ official certicate “ is rather vague. I do not want brandy to be imported that is not distilled wholly from grape wine, but still I do not want to be excluded brandy, which is, in fact, pure brandy, because of some dispute as to whether the certificate by which it is accompanied is official. I fear that the term “ official certificate “ will lead to difficulty.
– I hold in my. hand a letter written by a firm who, speaking on behalf of the importers of French brandies, say that they are prepared to produce certificates signed by French officials. They point out also that Great Britain accepts these certificates.
Senator Sir JOSIAH SYMON (South Australia) [6.11]. - The difficulty is in regard to the certificate. What is an “official certificate “ ? By whom is it to be given? It must, of course, emanate from the country of origin.
– It is given by the French Customs authorities.
-Where is that stated in the clause? It ought to be amended so as to read “ certificate from the French Customs authorities.”
– That would not do, because some brandy might come from Spain.
– They may present anything and say that it is official.
– It cannot be official unless it emanates from an official source.
– What does “ official “ mean?
– It is certainly connected with the Government of a country.
– I do not think so.
– Do not be too particular. Give us the power that we want.
Proposed new clause agreed to.
Clause 10 -
After the twenty-eighth day of February, One thousand nine hundred and seven, no imported spirits shall be delivered from the control of the Customs for human consumption unless the Collector of Customs for the State is satisfied that the spirits have been matured by storage in wood for a period of not less than two years.
Provided that this section shall not, until the first day of January, One thousand nine hundred and eight, apply to gin, geneva, hollands, schnapps, or liqueurs.
Senator Col. NEILD (New South Wales) [6.12]. - I wish to secure a reasonable extension of the period provided in respect of the clearances of imported spirits. The interval between now and the 28th of February is not a very long one, and I am credibly informedby some of the principal importers of Melbourne - I admit that I am not speaking on behalf of any constituent - that it is not sufficient to enable them to clear the spirits which they have already ordered by mail. The clause contemplates an interval of only five months before the stipulation as to imported spirits being matured in wood, will become operative. Seeing that it takes two months for an order to reach Home and be executed, and three months for a sailing vessel to accomplish the return voyage, the provision really does not permit sufficient time to enable importers to clear from the Customs goods which have already been ordered. It will be observed that in the case of spirits of local origin, an interval up to the 1st of January, 1908, has been allowed. If the Minister will consent to extend the period till the 28th of April next, I shall not move an amendment.
– The two periods ought to be made to correspond.
– I think it would be fair to make them agree, and if it is the wish of the Senate, I am prepared to move in that direction. At the same time, if the Minister cannot agree to my request, I am willing to accept a less period within reason. If he is not disposed to concede that, I will move to place the imported spirits and spirits which have been locally distilled upon the same footing.
– The cases are not parallel.
– I would point out to Senator Neild that imported spirits and spirits which have been manufactured in the Commonwealth are not upon the same plane. The period between now and the 28th February is a comparatively short one. If we extend it to the 30th June, importers will have ample time to clear their goods from the Customs, and will not have the slightest ground for complaint. I therefore move-
That the words “ twenty-eighth day of February,” be left out, with a view to insert in lieu thereof the words “ thirtieth day of June.”
Amendment agreed to.
Amendment (by Senator Playford) proposed -
That after the words “ imported spirits,” the following words be inserted : - “ (other than gin, geneva, hollands, schnapps, or liqueurs).”
– I should like to point out that if inspection is to be insisted upon in respect of other classes of drink-
– What is now proposed has already been provided for in the Excise Bill. This is merely a consequential amendment.
– Will the Minister explain how he can guarantee to those who consume gins, genevas, hollands, schnapps, or liqueurs, that they are receiving a pure article ?
Amendment agreed to.
Amendment (by Senator Playford) agreed to -
That the proviso be left out.
Clause, as amended, agreed to.
Clause 11 -
Spirits distilled in Australia shall not be delivered from the control of the Customs for human consumption unless they have been matured by storage in wood for a period of not less than two years.
Provided that this section shall not come into operation till the first day of January, One thousand nine hundred and eight.
– I move -
That after the word “Spirits” the words “other than gin” be inserted.
That is absolutely necessary, since we have provided that spirits distilled in Australia shall not be delivered from the control of the Customs for human consumption until they have been matured. It is now desired to insert words, so as to make it quite clear that this clause will not apply to spirits which have not been matured for two years, but which are taken out of bond for the fortification of Australian wine.
– Why does the Minister insert only the word “ gin “ ? We have been dealing with many kinds of spirits which we all agree will not improve by storage in wood, and clause 10, it is provided, shall not apply to gin, Geneva, Hollands, schnapps, or liqueurs. In my opinion, we ought to again use the same words. We may be told that the other varieties are not manufactured in Australia, but they may be manufactured here at some time.
– It would only be a repetition of words ; but if the honorable senator desires, I shall amend the amendment in the way suggested
Amendment amended accordingly.
Senator Sir JOSIAH SYMON (South Australia) [6.22]. - I am very glad that the Minister proposes to add the proviso indicated. I would point out that it is not only necessary to provide for gin, Geneva, Hollands, schnapps, or liqueurs, but that the provision ought to extend, so I am informed, to rum, which does not improve in wood. ,
– We have agreed that rum shall be kept in bond for two years.
– Then I shall not press that objection. Will the provision include spirits, n.e.i. ?
– I do not suppose that spirits for scientific or industrial purposes will be put into human consumption.
– That would not be permitted.
– I think that is right. For the information of honorable senators, I shall read a communication I have received from those interested in the trade, who are desirous of having these provisions put on a proper footing -
Items 7 to11 should be absolutely free of age conditions, because they do not improve by being stored in wood, &c. ; the spirit is separated from all impurities by rectification to a strength of 60 to 67 over proof. We may mention Mr. Seppelt entirely agrees with us on the point, consequently the age conditions become harassing to the manufacturers, which we feel sure is not the intention of Parliament.
The safeguard is that the clause applies to spirits which are issued for human consumption; and, I suppose, it is not neces- sary to except methylated spirits which could not be used for that purpose.
.- This appears to be a most puzzling Bill. These clauses are to prevent spirits from going into human consumption until they have been two years in wood. Presumably this condition is inforced, because spirits, which have not been so matured, are not fit for human consumption ; yet there is an amendment that they may be used for the fortification of wine.
– The wine has to be kept for two years.
– Where is there a provision to that effect ?
– There is no provision, but it is the practice to keep wine for two years.
– That may be the practice in some cases, but I very much doubt whether it is a universal practice. There is nothing in our legislation to prevent wine from being put into human consumption immediately. It seems rather a startling inconsistency to declare that spirits under certain conditions are not fit for human consumption, and then to provide that such spirits are good enough for fortifying wines.
Amendment, as amended, agreed to.
Amendment (by Senator Playford) proposed -
That the following words be added to the clause : - “ Provided further that this section shall not apply to spirits for fortifying Australian wine.”
.- Does the Minister consider it proper to expressly declare that spirits under certain conditions are not fit for human consumption, and then to provide that such spirits may be used for fortifying wine, there being no law to inforce the maturing of the wine ?
– Old spirits cannot be put into new wine.
– I have never heard that before.
– Old spirits are detrimental to new wine.
Sitting suspended from 6.30 to 7.45 p.m.
Amendment agreed to.
Clause, as amended, agreed to.
Clause 12 (Inferior spirits).
– Does the Minister intend to allow clause 11, with the proviso that it shall not come into operation until 1908, to remain in the Bill?
– Clause 11 has already been dealt with.
– May I be permitted, sir, to point out that clause11 practically provides that spirits that are distilled in Australia can, until the date specified, be delivered for human consumption although they have not been matured for two years? In the Excise Bill we have provided that spirits coming into consumption without being matured for two years shall pay certain higher rates of duty.
-They will pay the n.e.i. duty.
– But, according to the proviso to clauseII, until 1908 as much raw spirits as distillers choose to put on the market may go into consumption.
– But the Excise Bill provides that they shall pay the n.e.i. duty.
– That is so; but the operation of this clause, in conjunction with the provision in the Excise Bill to which I have referred, may result in Australian distillers not having in 1908 any large. quantity of spirit that has been matured in wood for two years.
– The 1st January, 1908, is the date fixed in the proviso.
– So that, until the end of next year, every distiller may allow his spirits to be sold, although they have not been matured for two years.
– He can do that under the existing law, and this clause imposes a limitation.
– But is the limitation a good one ? I doubt it. The consequence of the proviso may be - I am not necessarily assuming that it will be - that no attempt will be made by Australian distillers to mature their spirits in wood until 1st January, 1908.
– If they did that, they would have to cease selling for two years after that date.
– No; they might have to pay the higher Excise duty, but that is the only condition imposed upon them. It would appear desirable that the clause should come into operation at an earlier date, so that our intention may speedily be carried out.
– As we have already dealt with clauseII, I would suggest that the Minister should consider Senator
Clemons’ proposal, and, if necessary, move later ora that the clause be recommitted.
– This Bill is to grant increased protection, subject to certain conditions. If. as Senator Clemons has suggested, distillers choose to sell raw spirits continuously, they will not secure that increased protection.
– I admit thai.; but the Bill has another object- that of inducing the distillers to mature their spirits in wood.
– Incidentally, it has that object ; but its chief purpose is to grant protection. We say, in effect, to the distillers, “ As this increased protection has been granted, you must do what you have not hitherto been compelled to do. You must, after a certain date, mature your spirits in wood for at least two years.”
– I must ask honorable senators to deal with clause 12/ which is now under consideration.
Clause agreed to.
Clause 13 -
– There is a provision in this clause in reference to the use of methylated spirit for the manufacture of scent, which, according to information presented, to me, seems to be a mistake. I am advised that, during the whole history of Australia, scent-makers have been permitted to use methylated spirit for this purpose.
– Is methylated spirit used in. making scent ?
– Messrs. Blogg Brothers are my authority for the statement. I confess that I have no knowledge on the subject save that which has been presented to. me. In a circular which Messrs. Blogg Brothers have distributed among honorable senators, they state that -
Methylated spirit has been permitted to be used in the manufacture of scents, during the” whole past history of Australia, and the industry of scent-making has rested upon the use of methylated spirit. It would be manifestly unjust to disturb this long esablished custom, and thus extinguish an industry which is a credit to the country and a large employer of labour.
I am inclined’ to think that that is a slightly exaggerated statement.
– A greatly exaggerated one.
– If it is a fact that they have been permitted to use methylated spirit, it seems to me to be an enormous additional handicap to their industry to provide that they must pay 10s. per gallon where only Australian’ products are used, and 15s. per gallon if they make use of a mixture of Australian and imported products on their principal raw material, which they previously obtained duty free. They urge, and I think with great force, that they will be unable to stand such an enormous increase in the cost of production, and their industry will, consequently, be wiped out. This is an ex parte statement, and I know nothing of the facts, but give the statement as presented to me by a reputable firm well known in the industry. Unless good reason is shown to the contrary, I purpose to move the omission of the word “ scents “ in this clause in order to put the scent-making industry in the position in which I am informed it used to be. If that amendment be agreed to, it will be necessary to make a similar amendment in clause 16. I should like to hear some discussion of the matter by the Minister, or by a member of the Tariff Commission.
– Senator Trenwith will readily understand that I should be the last person in this Chamber, or elsewhere, to make an accusation against any man or firm unless I were prepared to follow it up by justifying it. I therefore expect that anything I am now going to say will be taken in its widest application, and without reference to any one in particular. I shall not mention any man’s name. Senator Trenwith will remember that, on the second reading of the Bill, I directed some attention to the question .of methylation. I then said, speaking broadly, that the Tariff Commission had had certain evidence pointing to the fact that spirits had been methylated and allowed to go into use at the low Excise duty of is. per gallon, and had, subsequently, been demethylated, or der odorized, and put into human consumption. It seems to me to be an extremely difficult thing for any manufacturer of scent to use methylated spirits in its preparation unless by him, or some one else for him, they were deodorized or demethylated. Senator Trenwith would recognise the difficulty if he had ever smelt methylated spirits.
– Yes ; one would not describe it as a toilet scent.
– The honorable senator must recognise the great difficulty there would be in using methylated spirits to produce the pleasant odour of a scent. I cannot make the statement without hesitation or qualification, but I do say that it seems to me that it is almost impossible for methylated spirits to be used in the manufacture of scent unless they are first, to some extent, demethylated. It might be urged that it would be fair to permit methylated spirits to be demethylated for the manufacture of scent.
– If it is manufactured in bond.
– Precisely. But Senator Trenwith will admit the great danger that would arise of allowing a certain amount of spirit demethylated for the manufacture of scent to get into human consumption.
– Could we not provide that the spirit should be demethylated and used for the manufacture of scent in bond, putting the cost of Customs supervision on the scent manufacturer, as is done in the case of tobacco?
– The matter is very difficult. I have no wish to injure the manufacturers of scent ; on the contrary, I should like to help them. It is admitted that silent spirit, to be methylated, requires the addition of something which, gives it a tremendously strong and pungent odour, to prevent its being used for human consumption, and there is no doubt that this must be got rid of before the spirit can be used for the manufacture of scent.
– They might as well have pure spirit straight away.
– Precisely. It will be an economic mistake if the spirit is first methylated, and we then permit the scent manufacturer to demethylate it. If we are to help the manufacturer of scent, I think we cannot do it bv permitting the use of methylated spirit.
– Mr. Blogg suggests boronia as a methylating element that would be destructive of the spirits for human consumption, whilst it would not injure them for the purpose of making scent.
– The Tariff Commission fully considered the use of boronia, and of a number of other things, for the methylation of spirits, and I have regretfully to say that, to permit the use of boronia in the way suggested is quite im possible. We had a good deal of expert official evidence on the question of methylation, and it may be taken as a fact that, in order to methylate successfully and satisfactorily, something must be added to spirits which will give them a tremendously pungent odour, which cannot be got rid of except by demethylation. If that is not done, the methylation is not successful, and the way is opened to fraud on the Customs. I should be glad to help the scent manufacturer by relieving him of the Excise duty ; but I do not see how it can be done through the use of methylated spirits. The only solution of his difficulty is to enable him to’ use silent spirit.
-We have already decided that he shall pay a duty of 10s. per gallon under the Excise Tariff Bill.
– That is so, and Ido not see any escape from that position.
– I think that something should be done to give encouragement to the manufacturers of scents and essences. Senator Trenwith has said that in the past they have not had to pay duty on spirits used, but I do not think that statement is quite correct. I know that a number of firms, in the manufacture of their preparations, have used spirits which have paid duty. What some manufacturers complain of is that some one discovered a means of demethylating spirits in a way that could not be detected, and sold the right to use his discovery to only one firm in Sydney, in Melbourne, and in Adelaide respectively. . This put the whole of the other scent manufacturers at a very considerable disadvantage. Probably there was nothing illegal in what was done in the past.
– We intend to make it illegal, if we can, by this legislation.
– We shall put all on exactly the same footing. One firm of manufacturing chemists put the position to me plainly. They said, “ We send our traveller into the northern districts of South Australia with certain preparations, but we are unable to compete with the people whose preparations are made from demethylated spirits on which they have not had to pay duty.” The complaint is made, not so much in regard to perfumes and essences as in regard to hair washes and hair dyes, in which a large quantity of spirits is used, and the odour of the wood naphtha does not matter much. The industry is a big one, employing a large number of men, and giving work to other industries, such as bottle manufacturing, while a good many are engaged in distribution. My opinion is that 10s. is too high” an impost, and if Senator Trenwith is prepared to move for its- reduction, I shall help him.
– My impression is that the manufacturers of scents receive a very large amount of protection, varying according to the quantity of spirit used in their productions. If the spirit is of Australian origin they have an advantage of 15s., while Senator Best wished to provide that in cases where imported and Australian spirit were both used, the charge should be proportionate, otherwise 25s. would have to be paid. We are doing the best that we can for them, and they will all be on the same footing. I gather, from what the Minister has told us, that those engaged in the manufacture of scents are satisfied.
– Obviously they are not.
– According to Senator Best, those who have consulted him think that it would be a concession. 10 get what he has asked for. If we gave every manufacturer all he demanded, the public would be in a very bad position, because manufacturers like to get all they can for nothing! and to sell at a high price. I am an ardent protectionist, but I think that we are dealing very fairly in this matter.
– I wish to know from the Minister what opportunity we shall have to see the regulations in which the method of methylation is prescribed ?
– The regulations must be printed and laid before Parliament within a certain number of days.
– I hope that when they are laid upon the table attention will be drawn to them, because this is a very important matter.
– We have adopted the method of methylation recommended by the Tariff Commission. It is set out in the schedule.
.- The Minister is making a mistake in prescribing by Act of Parliament the formula to be adopted for methylation. Whenever any process is determined upon, there are dishonest persons who set to work to devise means of demethylating the spirit.
That was being done very extensively some eighteen months ago.
– If the honorable senator turns to clause 13, he will see that the prescribed standards shall, “ until altered by regulation,” be as set out in the schedule.
Clause agreed to.
Clauses 14 to 25 agreed to.
Schedule and title agreed to.
– Does the Minister of Defence wish to take out of Committee this Bill, as well as the Excise Tariff Bill?
– I should like to get . the two Bills returned to the other House as soon as possible, because we have made a number of amendments in this Bill, and requests in respect of the other, which it will have to consider.
– It is necessary to recommit the Excise Tariff Bill, as the honorable senator knows, and there is the question of time in clause 11 of this Bill to be reconsidered.
– I do not think that the honorable senator need worry about that clause. We ought to allow a little longer time in respect of Australian spirits than in respect of imported spirits, because the latter are in- transit for four or five months.
– I am not acting in a party spirit. I am not thinking of the question of protection or want of protection, but I desire to impress upon the Minister the necessity of inducing Australian distillers to begin as soon as possible to store their spirits in wood.
– We have taken power to charge them a, higher Excise duty if they do not come under the Act, so that we are offering them every inducement to take that step.
– I shall allow the clause to go, though I think it is a little dangerous.
– If the honorable senator likes, I shall agree to reconsider it now, and if he desires I shall make it the same-
– No; it is quite right as it is.
– I think it is right as it is.
– It is all verv well for Senator Symon, who probably does not understand the clause, to try to stop the Minister, who does understand it, from completing his sentence. Was he going to intimate a reason why the clause should be reconsidered ?
– No, that is for the honorable senator to do.
– I do not intend to move for its reconsideration if the Minister is not disposed to accept an amendment, as I do not wish to waste any time.
– As regards imported spirits, I accepted an amendment which extended the time from the 28th February to the 30th June. I think that in the case of Australian spirits six months longer should be allowed than in the case of imported spirits, because the latter are so long on the passage, and in Great Britain there are bigger stocks of spirits which have been matured for two years.
– I only wanted to see Australian distillers starting to mature their spirits as soon as possible.
– I have agreed to make that allowance so far as brandy is concerned.
– I shall not press the point.
Senator Sir JOSIAH SYMON (South Australia) [8.22]. - I dare say that in the estimation of a member of the Tariff Commission no one else understands anything about the subject. What I do understand is that we are giving Australian distillers to the month of October - the period originally fixed was January, 1907 - not to enable them to pour out their immature spirits, but to allow them to get up their Stocks of the prescribed age. The Tariff Commission undoubtedly did a most excellent thing in recommending the enactment of the “age” provision. But then, as there has been no large provision hitherto, it would be very hard to suddenly pounce down upon the distillers and say that they should not be allowed to supply their customers in the interval with exactly the same liquor as they had been supplying to them hitherto. . We must allow them an interval, and I- do not think that fifteen months is very much too long.
– All right.
Bill reported with amendments.
Motion (by Senator Playford) agreed to -
That the Bill be recommitted.
In Committee (Recommittal) :
Clause 1 agreed to.
Clause 2 (as requested to be amended) -
In lieu of the Duties of Excise imposed by the Excise Tariff 1902 on spirits, Duties of Excise shall, from the seventeenth day of August, One thousand nine hundred and six, be imposed on spirits in accordance with the Schedule.
Provided that spirits distilled wholly from grape wine and spirits n.e.i. may, until the thirty-first day of December, One thousand nine hundred and seven, inclusive, be delivered at the respective rates of duty specified in the Excise Tariff 1902.
. -The proviso to this clause was allowed to be inserted pro forma on the understanding that we should have the right to discuss it on its merits at this stage. The only difference of opinion among honorable senators was as to the duty that should be paid on spirits distilled from grape wine and spirits n.e.i. The proviso practically enacts that the rate of duty for the grape wine spirit shall be us. per gallon. When we were discussing the schedule we decided to strike out the original item 3, on the ground that the spirit there designated was of a hybrid character, and should be dutiable at the rate fixed for spirits n.e.i. As the clause now stands, however, the duty payable upon such a mixture would be only 11s. per gallon.
– That is under the present Tariff.
– Exactly. No one wants to make a difference of only1s. in the rate of duty payable upon our best brandy and that imposed upon the worst spirit to which we afford any recognition. I would suggest that the proviso should be altered to make it read - “ may until the thirty-first day of December, One thousand nine hundred and seven inclusive, be delivered at the rate of duty provided in the schedule hereto for spirits n.e.i.”
That provision would only apply until 1907, and I think that the rate of duty provided for is a fair one to impose upon spirits which are almost entirely n.e.i., and which represent the lowest form of spirits to which we. give recognition in the schedule. By increasing the duty we shall be offering some inducement to those who hold spirit to mature it. for two years in the wood.
– Throughout the discussion of this question we have admitted that spirit distilled from grape wine should have a preference over others. Now the .honorable and learned senator proposes to place spirits wholly distilled from grape wine upon the same footing as the most inferior product.
– Does not the honorable and learned senator see that under the present Tariff spirit wholly distilled from grape wine is subject to a duty of ns. per gallon, whereas spirits n.e.i. have to pay Excise at the rate of 13s. per gallon. Now he proposes to place both spirits on the same plane.
– No, the Minister does not understand.
– The proviso reads as follows: -
Provided that spirits distilled wholly from grape wine and spirits, n.e.i., may until the thirty-first day of December, One thousand nine hundred and seven inclusive, be delivered at their respective rates of duty specified in the Excise Tariff. 1902.
The rates specified in the Tariff are 11s. for grape wine spirit, and 13s. for the other. The honorable and learned senator now wishes to subject both classes of spirit to the rate of duty fixed in the schedule for spirits n.e.i.
– But the grape wine spirit has not the necessary age.
– Nor has the other spirit.
– There is no reason why we should allow immature brandy to be placed upon the market.
– There would be no justification for penalizing grape wine spirit by subjecting it to the duty of 13s. per gallon, payable upon the worst spirit that is passed into consumption. All I am asking is that the present Excise duty shall not be interfered with in respect of spirits cleared out of bond up to the end of 1907, before they are matured for two years in wood. I contend that the spirits should be liable to the present rates of duty.
– I should like to point out what would be the result. If we allow raw spirits distilled from grape wine to be passed into consumption at the rate of 11s. per gallon whilst we impose a duty of 10s. per gallon upon similar spirit which has been matured in wood for two years,- no distiller will deliberately begin to mature any grape wine spirit until the two years have expired. If he is given his choice between paying us. on his raw spirit and getting off with a payment of 10s. by keeping it for two years in the wood, he will undoubtedly prefer to pay the 11s.. The result will be largely to defeat the object we have in view, which is to induce distillers to keep their brandy two years in wood to mature.
– We do not want to penalize them.
– The Minister is doing worse. He is inducing them not to keep their brandy two years in wood. They would sooner pay ns., and allow it to go into consumption forthwith, than keep it two years and pay 10s. If the Minister knows anything about ordinary business, and the rate of interest, he will see that that is what would probably happen. The Minister is really acting against his own intentions in making it so easy for distillers to sell their spirits raw. If the Excise is made 12s. it will induce them to begin maturing their brandy much sooner than if we left the rate as it stands. I suggest that to Senator Playford. The imported spirit will still have to pay 14s.
– I sympathize with the object that Senator Clemons has in view, but if he looks at the matter fairly he will realize that it will be much easier for the Customs Department and the distillers themselves to work under the duties that they will have to pay after 1908, than would be the case if we imposed a different duty up till that time. As only a little more than twelve months have to elapse between now and the beginning of 1908, I do not think that a great deal of harm can be done, because, although Senator Clemons urges that the distillers will not begin to mature their spirit until 1908, Ave have to remember that they will not get the benefit of the preference after that time unless the spirit is matured. It is to their own interest, therefore, to commence maturing it as early as they can, in order to get the full benefit of the Excise. It would be inadvisable to introduce here another rate of i2S., which I understand is what Senator Clemons desires. It will be better to allow the proposed duty to stand, giving those who have produced spirit from grape wine a little preference over those who have only n.e.i. spirits to sell.
Senator Sir JOSIAH SYMON (South Australia) [8.41]. - I do not see what advantage there is in inserting “ spirits n.e.i.” in this clause at all. There is no alteration in the dutv. The Bill says that spirits n.e.i. are to be charged the rates specified in the Act of 1902. That is the same rate as is proposed in this Bill. Therefore there is no need to mention spirits n.e.i. here The only spirits that need be dealt with in this proviso are spirits wholly distilled from grape wine. The reason for the proviso is that in the schedule there is a higher protection and a lower Excise on brandy defined as distilled wholly from grape wine bv pot still, matured in wood for a period of not less than two years, and certified by the Customs. The object of the proviso is to regulate the duties during the interval, and to enable the distillers to get off their stocks between now and January, 1908. None of the spirit which they are allowed to put out during that interval of fifteen months would be dutiable under this schedule, except as spirits n.e.i.
– Still, it makes the clause much clearer to leave the words in.
– It makes it verv stupid. Spirits n.e.i. have to pav 13s. per gallon in any case. It is only confusing to insert the words here. I therefore move -
That the House of Representatives be requested to amend clause 2 by leaving out the words “and spirits n.e.i.”
I agree, however, with Senator McGregor that it would be inadvisable to introduce into this Bill another rate of 12s., as suggested bv Senator Clemons. We ought not to have too many different rates, especially operating over so short a period as fifteen months. But I do think that, in respect of such spirit as is permitted to be delivered for consumption between now and the ist of January, 1908, not possessing the age qualification, we might fairly say that it shall pay the n.e.i. rate of 13s. What we desire to do is to carry out the exceedingly wise recommendation of the Tariff Commission in respect to ageing our wine spirits. We make a concession to the distillers in respect of the interval between now and the ist January, 1908, to enable them to fairly supply their customers, and at the same time to accumulate a sufficient stock of spirits which, after ist January, 1908, will be two years old.
– Then we shall be placing those spirits on the same level as spirits n.e.i.
– We shall be till ist January, 1908. We wish to offer our distillers an inducement to keep their spirits till they have the prescribed age upon them, and to discourage them from sending out a single gallon of immature spirits more than is unavoidable. That is the reason why the Senate ought to assist the Tariff Commission to insure that, at as early a date as possible, brandy made from grape wine shall have two years age upon it. If we merely provide that the immature spirit of this class delivered for human consumption between now and 1st January, 1908, shall pay ns. per gallon, there will be a, temptation to allow it to pass into human consumption rather than to hold it until it can be sent out at the 10s. per gallon rate with two years age upon it. For that reason, I shall , support the imposition of a duty of 13s. per .gallon.
– May I point out to Senator Playford that in this proviso we are endeavouring to fix the rate of duty which shall Be chargeable upon all spirits made in Australia which are not matured in wood. If he will refer to the schedule, he will see that, in respect of the spirits mentioned in items 2, 4, 5, and 6 we have provided that they shall be stored in wood for two years. In clause 11 of the Spirits Bill we have provided that spirits distilled in Australia shall not be delivered from the control of the Customs for human consumption unless they have been matured by storage in wood for a period of not less than two years. Then follows a proviso that that provision shall not come into operation until the ist January, 1908. The question therefore arises, “What duties are we going to impose, not merely upon spirits distilled wholly from grape wine, but upon every other item specified in the schedule till ist January, 1908?”
– We say it is fair that they should unless matured pay the present rate of duty.
– The Minister must see that the proviso should read - “ Provided that all spirits distilled wholly from grape wine,” &c. It would then cover every one of the items mentioned in the schedule to this Bill.
– There is no necessity for that. The proviso is confined to Australia and to grape spirit and spirits n.e.i.
– But it will apply to every one of the items enumerated in the schedule.
– Under the existing Tariff, with the exception of brandy, they all come under “spirits n.e.i.”
– That may be so, but even then the drafting of the clause is faulty. What I have suggested will meet the case exactly. For instance, “spirits n.e.i.” will not cover our best whisky. It excludes blended wine brandy and blended whisky.
– I see the honorable senator’s point.
– If we pass the proviso in its present form, we shall have made no provision whatever in respect of the duties to be paid upon these spirits up. till 1st January, 1908.
Request, by leave, withdrawn.
Motion (by Senator Clemons) agreed to-
That the House of Representatives be requested to amend clause 2 by inserting after the word “ that,” line 6, the word “ all “ ; and after the word “ distilled “ the words “in Australia” ; and by leaving out the words “ wholly from grape wine and spirits n.e.i.”
Senator Sir JOSIAH SYMON (South Australia) [8.55]. - The position now is that by virtue of the proviso, we suspend the operation of the scheduleto this Bill as to everything except spirits which have not been two years stored in wood until the 1st January, 1908.
– I think that, after the word “Australia,” we ought to insert the words “ not having been matured by storage in wood for a periodof two year’s.” Otherwise the man who matured his spirit for two years might find that he had to pay the higher Excise duty.
– That amendment would not affect the schedule.
– I think it would be safer to insert the words I have suggested.
- Senator Playford will see that clause 2 provides that the duties of Excise shall be imposed on spirits “ in accordance with the schedule.”
Senator Sir JOSIAH SYMON (South Australia) [8.57]. - I think that the Minister of Defence is quite right; and we ought not to so hurriedly settle this matter. The enacting part of the Bill says that the duties are imposed in accordance with the schedule, but there is engrafted a proviso which exempts from the operation of the schedule all spirits distilled in Australia, irrespective of time, age, or any other condition. I think we ought to insert the words, “not having been matured by storage in wood for a period of not less than two years.”
Motion- (by Senator Playford) agreed to -
That the House of Representatives be requested to further amend clause 2 by inserting after the word “Australia” in the requested amendment, the following words : - “ and not having been matured by storage in wood for a period of two years.”
Clause, as requested to be amended, agreed to.
Clause 3 agreed to.
– At Senator Best’s request, I move -
That the House of Representatives be requested to amend the schedule by inserting after item (11) the following : - “Spirits for the manufacture’ of scents and toilet preparations from imported and Australian grown ingredients in the proportions and under the conditions prescribed . . . per gallon, 15s.”
The reason for this request is that unless there was a full supply of Australiangrown material for the’ manufacture of scent, manufacturers would be blocked by the duty of 10s. per gallon on imported spirits used along with Australian-grown material. Under the amendment, if manufacturers could not procure all the Australiangrown material they required, they would get as much as they were able, and, with the aid of imported material, goon manufacturing scent; but the Excise charged on the spirits they used would be 15s., or in proportion to the quantities of the different ingredients used. . I showed this amendment to the Minister of Defence, and I understand that he sees no objection to it. He suggested, however, that aperiod of two years should be provided for, and that suggestion I am willing to accept.
– It is possible that I do not understand this proposal, but it seems to me to be one that not only will deprive scent-makers of the immunity from the payment of duties on their raw material of spirits, but will make them pay more than they would if this Bill were not passed. The Excise now on any kind of spirits, for any purpose whatever, is not more than 13s., and if this Bill were not made law, scent-makers could purchase any kind of spirit they wanted at that rate of duty. This, so far as I see, is a proposal to add ‘2s. to the Excise.
– The amendment would only complicate matters.
– At At present I cannot see any object in the amendment, except to .make scent-making more difficult than it is at present, assuming the manufacturers do not use methylated -spirits. During the whole history of the Commonwealth, manufacturers have been making scent from methylated spirits. They have, I suppose, by distillation or otherwise, demethylated the spirit, and made it suitable for other purposes. But if they desire to use spirits of wine, or any other form of spirit, under the existing law, they may obtain it on paying an Excise duty of 13s. per gallon. We are now introducing a Bill to increase the protection granted to the distiller, and this is a proposal to add 2s. per gallon to the Excise duty on spirit for scent-making purposes.
– On the higher class of spirit.
– Yes ; I think there must be some mistake ; it seems to me to be incomprehensible. As the Bill stands at present those who use only Australian flowers or Australian -essential oils in the manufacture of scent will have to pay an Excise duty of 10s. per gallon on their spirit, whereas this proposal is that they shall pay an Excise duty of 15s. per gallon if they use imported, or partly imported and partly Australian, material. Clearly, it cannot be the intention of Parliament to so seriously handicap this industry. I do not know whether it is an important one. but it is an industry that is established in Australia, and has been instrumental. I understand,- En bringing the luxury of perfume within the reach of people who. because of its cost, could not previously enjoy it. Unless there is some -explanation which I cannot foresee, I hope that the request will be rejected. The position of> the industry is bad enough, and if we raise the cost of the raw material to scent-makers from nothing to 15s. per gallon, so far as the Excise duty on spirits is concerned, it will be still worse. Senator McGregor must be misinformed.
– I merely move the amendment on behalf of Senator Best.
– I wish Senator Best were here. I submit that if the request be rejected, scent-makers will obtain spirits for the manufacture of scent from colonial products upon payment of an Excise duty of 10s. per gallon - the duty on spirit required for wine brandy. That seems to me to be sufficient, more especially as in the history of the industry scent-makers have not had to pay any Excise duty. It is alleged that some abuses have crept in, and that, therefore, an Excise duty is necessary.
– I shall vote against the request.
– I have pointed out these facts in the hope that they will cause honorable senators to vote against the request.
– I stated, in submitting the request, that I did so on behalf of Senator Best. I should like to point out to Senator Trenwith that even if- we fixed the duty at 13s. per gallon some differentiation would have -to be made between spirit required for toilet preparations that are manufactured wholly, and those made partly, from Australian-grown ingredients. If honorable senators think it desirable to allow’ scent-makers to do the best they can under the schedule as it exists - and under which spirit for certain purposes is dutiable at ros. per gallon - well and good ; I shall not persist in a request that is not of my creation. But I am calling attention to the fact that spirit required for a preparation made partly from Australian and partly from imported material would still have to pav the higher ‘duty unless a regulation were passed allowing a proportionate amount of Excise to be charged in respect of that part which was of Australian and that which was of other origin. I think that the reason for the imposition: of the Excise duty of 10s. per gallon was that a high duty is charged in respect of spirits contained’ in imported preparations of this description. If the Minister opposes the request, I will not press it.
– I do not oppose the request. I have asked the officers of the Department, and they have no objection to it. They have the matter in their own hands, since they have the framing of the necessary regulations. We have agreed that spirit for scent manufactured from Australian products shall bear an Excise duty of 10s. per gallon. The manufacturers already have a protective duty of 25s. per gallon, so that they are thus protected to the extent of 15s. We think that is ample. It appears, however, that scent-makers have frequently to use imported material, and those who do so represent that, if they are allowed the privilege of carrying on their work in bond, under proper regulations, they will make their scents partly from Australian and partly from imported materials, on the basis of something like equal proportions of each. My officers can see no harm in that proposal ; but in this matter I am, of course, in the hands of the Committee.
– I would point out to Senator McGregor that this request would penalize the manufacturer of scent by the imposition of a higher Excise duty in respect of spirit required for that purpose than is charged for spirit used for any other object. That would seem to imply that scent-making is in some sense a baneful operation.
– No; but we must allow for the fact that the . protection granted the scent-makers is twice as great as that extended to other industries in which spirits are used.
– I take it that the protection is granted because of the great difficulty in establishing the industry. I do not think that a Bill to grant new protection should have been- introduced in order to reduce the protection already existing in respect of any other industry. If we wish to discriminate, we had better do’ so in another way. Let us leave the Excise duty of 1 os. per gallon on spirit for scent made from the products of other countries, or partly from imported and partly from Australian products, and reduce it to 8s., 5s., or some other rate, when required for the manufacture of scent from some pure Australian product. That would be more sensible; but as I realize that the Minister is anxious to get on with the Bill, and it is late now to make a complete provision for the difficulty, I shall be satisfied with the rejection of the request.
Senator GUTHRIE (South Australia)
Trenwith that, because we have gone so far,, we should allow things to remain as they- are. The manufacture of scent is a growing Australian industry; and it is here proposed’ to put an Excise handicap upon it. Wehave already provided that, in order to encourage the Australian wine industry, the Excise duty oh spirit for fortifying Australian wine shall be only 6d. per proof gallon, whilst it is proposed that an Exciseduty of 1 os. per gallon shall be paid on spirit used in the manufacture of perfumes, essences, and medicines of different kinds,, wholly composed of Australian products. If Senator McGregor will withdraw his’ request, I shall be prepared to adopt thesuggestion made by Senator Trenwith, and’ submit a request providing for a duty of 5s. per gallon on spirit used in themanufacture of scent wholly from Australian products. We are dealing with a bigindustry established in every one of theStates.
– I am informed that it is a very small industry.
– When a man receives £600 a year from one manufacturer in each of three cities of the Commonwealth for the use of his discovery for thedemethylization of spirits, the industry cannot be a very small one.
– I fancy that some of that spirit must have gone into human’ consumption.
– I am satisfied that the firms who pay this money do not put any of the demethylated spirit into humanconsumption, unless in the shape of medicine.
– - If I know what this means, and I think I do, I ought, perhaps, to say something about it. I believe that Senator Guthrie is an ardent protectionist, but anything more disastrous to the cause of protection than the proposal he has made could hardly be conceived. The whole object of the amendment is simply this: Certain people - I do noi know whom - are making scents from Australian herbs or ingredients, or from imported herbs or ingredients, or from a mixture of both, and their object in getting Senator Best to move the request for this; amendment is to penalize any one who tries to make scent from anything except anAustraliangrown ingredient. We have provided that the Excise duty on spirits used” for making scent shall be 10s. per gallon, and this is an effort to make any one who dares to use anything but an Australiangrown ingredient in, the manufacture of scent pay 15s. per gallon on the spirits used. If Senator Guthrie’s proposal were adopted, the result would be that whenever any spirits were used for the making of scent from ingredients imported, or from Australian and imported ingredients mixed, the Excise duty would be 5s. per gallon, and if the spirits were used with Australian ingredients only, it would be 10s. per gallon.
– No, the honorable senator has got it the wrong way about.
– Senator Guthrie’s suggestion is that spirits used with Australian and imported, or with imported ingredients only, in the manufacture of scent, should pay an Excise duty of 10s., as proposed by the schedule, and if used only with Australian ingredients, should pay an Excise duty of 5s.
– The amendment means something like this : A man is building a table, and intends to varnish not only the legs, but the top of it. If he uses Australian-grown timber for the legs, and is foolish enough to use imported timber for the top, he will have to pay half as much again for the varnish which he applies all over thetable, as he would have to pay if he used only Australian wood in its construction. The amendment requested is a very small affair, and I think also that it is inadvisable to penalize a man who desires to make good scent by the use, perhaps, of 25 per cent. of imported ingredients with 75 per cent. of Australiangrown ingredients.
– What does the honorable senator propose ?
– That we should leave the schedule as it is, and should not say to the manufacturer of scent who ventures to use any ingredients brought from abroad in order to make good scent, that he shall pay on the spirit he uses a penalty of half as much again as the duty which he would be required to pay if he used only Australian ingredients. The scent manufacturers have already an enormous advantage, since the present duty gives them a margin of 15 per cent. protection.
– The present duty gives them a protection of 25 per cent., but under this Bill they will have a margin of 15s. per gallon.
– I do not propose to press this request; but I do not think I should withdraw it in order to carry out what Senator Guthrie seems to desire. I point out what the effect will be if the request is defeated, as I am certain it will be. According to what we have already done, any manufacturer of scents and toilet preparations from Australian-grown ingredients will have to pay 10s. per gallon on the spirits he uses. Under the requested amendment, if he made them of imported ingredients, or of a mixture of Australian and imported ingredients, he would have to pay 15s. per gallon, or an Excise duty beyond 10s. per gallon in proportion to the percentage of foreign ingredients used. If we leave the schedule as it is, the manufacturer who makes scent from imported ingredients or a mixture of imported and Australian ingredients, will get the spirits he requires under the n.e.i. provision with an Excise duty of 13s. Will that difference be sufficient to induce the manufacturers of scent and toilet preparations to encourage the growth of the requisite ingredients in Australia? I am unable to say, but I understand the object of the request put into my hands to be to encourage the growth and production in Australia of all the ingredients required in the manufacture of scent. Whether the honorable senator is going to vote for that or not I cannot say. I have carried out my promise to Senator Best, and if the amendment is lost 13s. will be the highest duty charged for spirit.
– I move -
That the House of Representatives be requested to amend item (12) by leaving out the figures “ 10s.” and inserting in lieu thereof the figure “8s.”
The amendment suggests a fair compromise. To encourage the wine industry we have reduced the duty on spirit for fortification to 6d. a gallon. Yet it is proposed to charge an Excise duty of 10s. on spirit used in the scent industry.
– What is the difference between the import and Excise duties in this case?
– In the other it is 12s. 6d.
– I think that we should see that those engaged in growing herbs and flowers are provided with a market, and should also give consideration to the manufacture of scent.
– I hope that the request will be carried. I am afraid that it will be a long time before scents can be manufactured entirely out of Australian ingredients, but this amendment is in the direction of encouraging the industry.
– We grow plenty of flowers.
– Where they are grown for sale it is chiefly to supply florists.
– Lavender water has been made here foryears past.
– Yes ; but hitherto the manufacturers of scents have been able to get their spirits duty free. Now, we propose to charge them 10s. a gallon.
– Is not the margin between 10s. and 25s. sufficient?
– It is enormous.
– I assume that we are giving a high rate of protection because of the enormous difference between the cost of manufacture here and elsewhere.
– The duty will not hurt any one. Scent can be bought for a penny a bottle now.
– A duty of 10s. a gallon amounts to a good deal where a manufacturer is using large quantities of spirit. If scent can be bought for a penny a bottle, I am glad that so desirable a luxury is being brought within the reach of the poorest. I am afraid that the increase in duty may have the effect of stamping out the scent industry, which has ramifications throughout Australia. I believe that it does not employ a very large number of persons, though one manufacturer stated the contrary. Probably he has had regard to those to whom employment is given incidentally, in the manufacture of bottles, the printing of labels, and other directions.
– I am in favour of the request. I do not see why we should make so much difference between the wine industry and the scent industry. The latter is very small, but it has great possibilities. In Europe, thousands of people are employed in growing flowers purely for scent-making, and, judging by our wild flowers, no other country is more suitable than Australia for horticulture. I am opposed to low Excise duties where they mean loss of revenue, but, in this instance, the loss will be nothing, becausethe high import duty will make the importation almost nil. I do not see why the rate shouldnot be reduced to 6d.
– There is at present a protection of 150 per cent.
– I know that. I am thinking more of the manufacture of scent for export.
– A drawback on the spirits used would be allowed when the scent was exported, so that they would1 really get free spirits.
– That partly meets my objection. In any case, even if the scent is only for local consumption, I cannot see why we should put the industry of scent-making on a different footings from the industry of winemaking. I intend to vote for a lower duty, and therefore I shall support the request.
– I hope that honorable senators will’ allow the item to go as it is, because the sooner the Bill is returned to the other. House the earlier will the session be brought to a close. I would remind Senator Smith that the greater proportion of scents and’ toilet preparations is spirit. A manufacturer pays an Excise duty of 10s. on a gallon of spirit, and, after adding the ingredients, puts the article upon the market at 25s., which is equal to a profit of nearly 15s. I think that he will be very well protected if the item is left as it is.
– - Honorable senators object to my request because the local manufacturers enjoy a protection against outside competition : but it must be remembered that the competition within the Commonwealth is keen.
– They are all on the same footing.
– Yes : but one is competing with the other.In the past Senator McGregor has argued that the duties are not paid by the consumer, but this evening he has argued that, because there is a duty of 25 per cent. on this article, that will be charged to the public.
– A large number of manufacturing chemists are engaged in this business. Competition in the trade is strong, and if the Excise duty were reduced from 10s. to 8s. per gallon, the public would derive a benefit. I do not believe that manufacturing chemists make a high profit though the retailers may, aswe all know that chemists’ prices are high.
– Scent is a luxury.
– These spirits are used in the production of toilet preparations as well as scents. To some persons toilet preparations are absolute necessities. I wish that I had proposed a reduction of the duty to 5s.
– Iintend to support the request. If Senator Guthrie had proposed to reduce the duty to 5s. , I should have supported the proposal with very much more pleasure. I am astonished at the attitude taken up by a number of honorable senators who profess to be desirous of establishing one of the most pleasant industries in winch it is possible for any one to engage. We continually hear about people being crowded in the cities. Scent-producing herbs and flowers are grown in the country. The Australian climate and soil are remarkably suitable for an industry of that character. I am most astonishedof all that the representatives of Tasmania should be opposed to the amendment, because that State is probably more adapted to the industry than is any other portion of the Commonwealth. We want to extend the area of Australian employment by every means we possibly can. We have given encouragement to whisky distillers, but it is proposed to penalize flower-growers. We may be a very practical people, but we certainly are not very aesthetic.
Question - That the House of Representatives be requested to amend item (12) by leaving out the figures “ 10s.,” and inserting in lieu thereof the figure “ 8s.” - put. The Committee divided.
Majority … … 13
Question so resolved in the negative.
Schedule agreed to.
Bill reported with further requests.
– I move -
That the Bill be now read a second time.
Honorable senators will recollect that section 105 of the Constitution provides that the Commonwealth may take over from the States their public debts as existing at the establishment of the Commonwealth, or a proportion thereof, according to the respective numbers of their people, as shown by the latest statistics, and that the Commonwealth may convert and consolidate such debts. Honorable senators are familiar with the other provisions of the section. From the very inception of the Federation, the States Treasurers and the Federal Treasurers have given consideration to the best course to be adopted in the taking over and consolidating the States debts. Several Conferences have been held, and I think I may safely affirm that, with hardly an exception, representatives of the Commonwealth and of the States have agreed that the proper course to adopt is to take over the whole of the States debts, instead of only those existing at the time the Commonwealth was inaugurated. Honorable members will recollect the proposal of the late Treasurer, Sir George Turner, that the whole of the States debts should be taken over, and that, as the three-fourths of Customs and Excise revenue returnable to the States would not be sufficient to meet the whole of the interest charge upon such debts, the States should consent to the Commonwealth taking from the railway revenues of the States a sufficient amount to make good the deficiency. If honorable members will look at table F in the report that the Treasurer has presented, they will see a statement showing the public debt of Australia as at 30th June last. They will also notice that the indebtedness per head varies considerably, Victoria having considerably the smallest indebtedness, and Queensland very much the highest. The amount of the States debts at the time that the Commonwealth was established was £20 1,983, 386. In the interval, the States have floated loans which have increased their indebtedness by £34,697,353. New South Wales has been the largest borrower, having added to her indebtedness to the extent of some £19,000, 000. Victoria has borroweda little more than£2,000,000. Queensland slightly more than £4, 000, 000, South
Australia .£2,930,000, and Western Australia ;£4>393;°°o-
– They have borrowed more than that, but they have only added to their indebtedness to that extent.
– Yes, they have converted a number of loans, but they have not increased their indebtedness beyond the extent I have indicated.
– The total indebtedness upon which it is now desired to operate, instead of being £.201,000,000, is £236,000,000?
– Yes; the total indebtedness of the States is £236,680,739. As the Constitution stands, we could not take over any of the debts of the States except those which existed at the time that the Commonwealth was established. We now desire to obtain power to take over th; whole of the States debts. The States are willing that we should have such power, because they think it would be better for us and better for them. Honorable senators will readily understand that the utmost confusion would arise if we took over only a portion of the States debts. If we went into the London market, and floated a loan for conversion purposes - of course, we should convert the loans only as they fell due - we should very likely call our Australian stock consols, to distinguish it from the ordinary Australian inscribed stock, which is the present title under which we float our loans. If we did not take over the whole of the debts of the States we should be very likely to increase the value of the part of the debts we could not take over to a considerable extent. The holders of the stocks would get the advantage, and not the States.
– What about the loans which the States will float in the future?
– It is a question for consideration whether it would not be advantageous for Ahem to confine their future borrowing operations to the Commonwealth itself. They could always get the money they required. But that is a matter with which I do not wish to deal. This Bill is brought in to alter the Constitution, to enable us to take over the whole, instead of a part, of the debts. Honorable senators have doubtless looked at table J, which shows the public debt per head of the population on the 31st December, 1905. It is a very interesting table, and amounts to this : New South Wales has a debt of £55 head of her population, Victoria £46, Queensland £80, South Australia £70, Western Australia £66, and Tasmania £52. lt will be noticed, in the first place, that Victoria stands in the best position. If we took over the whole of the debtsshe would have to pay very little to theCommonwealth over and above the threefourths of the Excise and Customs duties that she receives from the Commonwealth. But Queensland would have to pay a very large sum indeed. South Australia would alsopay a considerable sum, so would New South Wales, whilst Western Australia and? Tasmania would have to pay lesser proportionate amounts.
– I - Is the honorablesenator basing that statement on what theStates received last year, or in any particular year, or on the average amount re’ceived ?
– The figures which. I have quoted are based upon the estimated population of the States on the 31st December, 1905.
– B - But on what basis is the honorable senator estimating theamount of revenue returned to the States ?
– I am not giving, those figures in detail now. The next point to which I wish to refer is a statement published by the Treasurer, Sir JohnForrest, entitled, “Financial Problems of the Constitution with Proposals for Solving Them.” It is dated 9th July, 1906. The first part of it deals with the question towhich I am now referring- that of taking over the debts of the States. Sir John Forrest’ points out that during his recent visit to London he had an opportunity of consulting leading financiers, directors of financial institutions, and officials at Hia Majesty’s Treasury, and he says -
The result of such consultations fully satisfies me that it would be financially advantageous to Australia if the transfer of the StateDebts to the Commonwealth, as authorized and intended by Section 105 of the Constitution, were undertaken as soon as possible ; and further, I was assured that such proposals to transfer would be well received in financial circles in> London.
He points out that single States could not do much for themselves in this direction, and makes definite proposals of his own. What Sir John Forrest proposes is that alaw should be passed enabling the wholeof the debts of the States to be converted’ before maturity, or immediately on maturity, by the Commonwealth.
– I thought the honorable senator said just now that he would never advocate taking over the debts before maturity.
– Sir John Forrest recommended -
That a law be passed enabling the whole of the State Debts to be converted before maturity, or redeemed at maturity by the Commonwealth (subject in regard to debts incurred since ist January, 1901, to the necessary amendment of the Constitution), by such successive operations -as may be thought fit.
This Bill deals with that subject.
That until conversion or maturity of the State Debts, as the case may be, each State continue to pay its own annual interest and sinking fund (if any).
– Is it proposed to convert any debts before they mature?
– I think not. It is clear, from what I have read, and from -conversations which I have had with him, that Sir John Forrest would not think of it. My own experience is this : When I was -Agent-General for South Australia in London, my Treasurer wanted me to convert some of our stocks which were not falling due. Some had five years to run, others ten years, and so on. I had the advantage of being able to obtain valuable information from the New Zealand office concerning the result of its financial operations of a similar character. I think it was Sir Julius Vogel, then Premier of New Zealand, who secured the passage of a Bill for the purpose of consolidating stock. It will be known to honorable senators that at one time New ^Zealand had a number of Provincial- Legislatures which had floated loans at different periods, and at various rates of interest, running up as high as 7 per cent, and down to 4 per cent. Sir Julius Vogel therefore desired to have a consolidated New Zealand stock. A law was enacted to that effect, and under it he consolidated as far as he could the old debts of his Colony and some of the newer ones. In other words, he issued a 4 per cent, consolidated stock. I looked into the figures, which were very courteously supplied to me by the New Zealand Agent- “Genera.1, and found this to be the position - that in the meantime, instead of 4 per cent, being the ruling rate of interest, it had fallen to 3 per cent., subject to slight discounts. I think that the lowest rate for which I was able to finance for my State was £96 15s. for a 3 per cent. loan. In some instances in which the New Zealand Government did consolidate their stock they had to pay as much as £130 Per £too in order to induce the people to relinquish it. Naturally, as the loan had seven years to run, the bondholders were not willing to convert their stock into 4 per cents, unless they received a substantial consideration for so doing. I made a careful calculation of the whole of the expenses in connexion with the transaction, and I came to the conclusion that if New Zealand had not converted a single portion of those loans, she would have been better off. Had she allowed her 7 per cent, bonds to mature, she would have only had to pay £100 for them when they fell due, and when that time arrived, instead of having to borrow at 4 per cent., she could have borrowed at 3 per cent., or, at most, at 3h per cent. The result was that for a few years she apparently made a big profit, but in reality she made a big loss. Before a bond-holder will give up a bond that constitutes his security for money lent he naturally asks for a higher price than the market price of the day. I pointed out to the right honorable member for Balaclava, and to the present Treasurer, that it would be folly for us to attempt to convert a loan until a few months before it matured.. We should then be in a position to make terms, because the bond-holders would not have the whip-hand over us. I understand that that is what is really intended in regard to the conversion of these States debts. In order to show the reason why we wish to acquire power to convert the whole of the States debts the Treasurer, in moving the second reading of the Bill, said -
The object of taking over the debts is to place the borrowing power of Australia on the best possible footing, to enable us to borrow to advantage, and to give an opportunity for the saving of a considerable sum of money. We are advised, and1 believe, “ that by having one denomination of stock firmly established on the London market, secured on the consolidated revenue of the Commonwealth, a considerable advantage and saving to, Australia must eventually result.”
He then goes on to say -
In the memorandum to which I have referred it is proposed “ that all net profits arising from any conversion or redemption of existing loans shall be credited by the Commonwealth to the State concerned, and the annual payment bv that State reduced accordingly from time to time.”
The Treasurer does not propose to pool the States debts, but to keep an accurate account of the profit which is made in connexion with the conversion of each particular loan, and to credit the State concerned with, that amount.
– What will be done if any losses are incurred ? “Senator PLAYFORD. - There will be no losses. The Treasurer continues -
The financial authorities whom i consulted in London were unanimously of the opinion “ that it would be disadvantageous to place the Commonwealth brand on State’ stocks before conversion. They thought that such action would prevent the possibility of any profitable conversion, and would be making to the existing holders of State stocks a present of any increase in price caused by the additional Commonwealth security.”
That is the reason advanced by the Treasurer for the action which we propose to take in submitting this Bill to the electors, and asking them to sanction such an amendment of the Constitution as will enable us to take over the whole of the States debts, instead of taking over only those which had been incurred prior to the establishment of the Federation.
– Suppose that we took over a loan of £4,000,000 of £5,000,000, which was just maturing, at an advantage. Who would derive that advantage ?
– Only the State concerned. We do not propose to pool the whole of the States debts. In some instances, they represent £80 per head of the population, and in others only £46 per head. We must keep a separate account against each State, and we must credit each State with whatever profit may be made upon any conversion in which it is interested.
– In other words, we must allow one State to make a profit by reason of the other States backing its bills. It is really a perpetuation of the bookkeeping system.
– Undoubtedly it is a bookkeeping system, but it is a fair system. Would the honorable senator pool the whole of these debts?
– That is a verynice proposition. If we take over a debt of a State we shall take it over just before it matures. We shall float a loan for the purpose, and call it Australian Commonwealth consols. We shall get the money, we believe, upon more advantageous terms than can any State, and if any profit be made out of the transaction we intend to give it to the State.
– From the Minister’sown experience, does he think that creditors at Home will regard Commonwealth stock as being more valuable than NewSouth Wales stock?
– Yes, just as they regard Canadian inscribed stock with morefavour then they do the stock of the Statesof the Dominion.
– Experience hasshown that.
– Yes ; there is a difference in favour of Canadian inscribed* stock, as compared with the stock of Statesof the Dominion, varying from one-half to 1 per cent. A man would be more likely to lend money to the Commonwealth at aless -rate than he would to a part of theCommonwealth. In the same way, a corporation cannot borrow money as advantageously as can a State.
– A - And the Commonwealth has unlimited powers of taxation,, which the States have not.
– Exactly. I hold’ in my hand a statement showing the amount of the saving which would be effected uptill the year 1952, when the last of theStates loans would be repayable, assuming that the Commonwealth were able to float loans at J per cent, less interest than couldthe States. From it I gather that, without calculating compound interest, theStates would be advantaged to the extent of £15,646,016. The whole of the particulars are given in the document from which I quoted, and it will be seen that the gain to the several States would be apportioned as follows: - New South Wales, £5,548,604; Victoria, £3>5°6,7n; Queensland, £2,674,915 ; South Australia, £i,975.3°2 ; Western Australia, £1,179,370 ; Tasmania, £761,114; thus accounting for the total gain of £15,646,016.
– Nearly all of that could be gained by the States if they converted their own debts.
– But the States, if they converted their own debts, would* not get so much by per cent, asthey would under the proposal I am nowsubmitting. I also have a statement showing what the gain would be at compound” interest.
– Does that statement -assume yearly or half-yearly rests ?
– I cannot go intoall the details, though the question of the honorable senator is an important one. We know that with half-yearly rests instead of yearly rests the amount would be more; and,- of course, even still more if the rests were quarterly or monthly. As I say, I have here a statement showing the amount of saving to the year 1952, assuming that the Commonwealth can float loans at i per cent, less than the States, and that such j per cent, be accumulated at 3 per cent, compound interest. The total-, saving would amount to £26,767,273, apportioned as follows : - New South Wales, £9.419.823; Victoria, £6,106,725; Queensland, £4,365,320; South Australia, £3,572,993; Western Australia, £1,966,940; Tasmania, £1, 335, 472. I think I have shown, at all events, that there would be considerable advantage in the Commonwealth having power to take over the whole of the debts - an advantage which could, and would, be shared’ by the community as a whole. I know of no State Treasurer who objects to the Commonwealth having this power, and to my knowledge Where mas certainly neve* been a Federal Treasurer who did not support its being conferred. No one supported the idea more strongly than did the late Treasurer, Sir George Turner, and, as the memorandum issued by Sir John Forrest shows, it is just as strongly supported by the present Treasurer. Under the circumstances, I ask honorable senators to agree to the second reading of this Bill, which proposes to strike out of section 105 of the Constitution the words - “ as existing at the establishment of the Commonwealth, or a proportion thereof according to the respective numbers of their people as shown by the latest statistics of the “Commonwealth.”
Then there is a provision to enable the Commonwealth to take over the whole of the debts.
Debate (on motion by Senator Drake) adjourned.
– I move -
That the Bill be now read a second time.
Honorable senators will remember that’ section 87 of the Constitution is as follows: -
During a period of ten years after the establishment of the Commonwealth and thereafter until the Parliament otherwise provides, of the net revenue of the Commonwealth from duties of Customs and of Excise, not more than onefourth shall be applied annually by the Commonwealth towards its expenditure.
The balance shall, in accordance with this Constitution, be paid to the several States, or applied towards the payment of interest on debts of the several States taken over by the Commonwealth.
What the Bill proposes is to insert after the word “ Excise “ the words “ (other than special duties of Customs and of Excise)” ; to insert after the word “ balance “ the words “ of the revenue from those duties (other than special duties)”; and to add to the section the following paragraph : - ‘ ‘ A special duty of Customs or of Excise is a Customs or Excise duty upon- goods of a description not liable to Customs or Excise duty on the first day of January, One thousand nine hundred and seven, and imposed expressly for specific purposes.”
– Is there any reason why there should not be direct taxation for the purpose in view?
– The Bill does not say a word about direct taxation, although we have the power of direct taxation.
– What about a land tax? ‘
– I do not know that we are proposing a land tax. Honorable senators will recollect that one of the questions to which attention has been directed by Commonwealth politicians is that of providing some fund out of which to pay old-age pensions, and that a Royal Commission was appointed, and has made certain recommendations on the subject. Their proposition was perhaps a little indefinite. At all events, they made a proposal to the effect that - ; -
– The Minister should not bother about what the Commission recommended. He should give us the Government policy.
– I am going to refer to the work of the Commission. The Commissioners reported that -
Your Commissioners recommend that, during the operation of section 87 of the Constitution, which provides for the return by the Commonwealth to the States of at least three-fourths of the net revenue from Customs and Excise duties, an arrangement should be made by the Commonwealth with the several States by which sufficient money should be handed over to the Commonwealth for the purpose of making good any deficiency in the Consolidated Revenue caused by the establishment of an old-age pension system.
The Governments of the States were subsequently asked whether they would be willing to hand over portion of their revenue for this purpose. I think that I am perfectly right in saying that New South Wales and Victoria expressed their willingness to do so, but I am not quite sure whether Queensland did or did not agree to the proposal.
– Queens-, land has not agreed.
– At all events, we could not induce all the States to agree to pass a law enabling us to take from the Customs and Excise revenue a sum sufficient to pay for a Federal scheme of oldage pensions. Honorable members will recollect that the Old-age Pension Commission took a great deal of evidence, and arrived at the conclusion that a Commonwealth system of old-age pensions would involve an annual expenditure of ;?i, 500,000. The raising of such a sum would naturally; involve great difficulty. This question was considered at a number of Conferences of States’ representatives, and at the Conference of .Premiers held at Hobart, the Right Honorable G. H. Reid, who was then Prime Minister, put the question -
– Why go to the Customs and Excise revenue for this purpose?
– I do not wish to be led off the track by discussing that question. The honorable senator may point out, later op, if he chooses, how utterly improper it would be to obtain the necessary revenue from that source. If honorable senators turn to the report of the proceedings of the Hobart Conference they will find that these questions were fully debated, and that a final answer was given when the then Prime Minister again put the question -
Do the members of the Conference say that if we put on such duties as tea and kerosene duties for the purpose of finding money for a national scheme of old-age pensions thev will, so far as the present members of the Government are concerned, facilitate that by passing such Acts as are necessary to enable us to retain the whole of such duties for that purpose- the purpose of paying old-age pensions. The result was that the Premiers agreed to a certain extent to the adoption of that course.
– Queensland was not very favorable to it.
– I think that the Treasurer of Queensland was as favorable as any of the others to it. The Premier of New South Wales, at the Sydney Conference, quoted a letter from Mr. Rason, who was then Premier of Western Australia, in which he stated that he wished -
To see associated with any system of old-age pensions established by the Commonwealth authorities a provision, made by them, to raise a portion of the cost by means of duty on kerosene, tea, or other articles of universal use.
In order that honorable senators may form some idea of the views expressed on this subject by those who took part in the Conference of Premiers held at Sydney last year, I propose to quote at some length from the official report. Mr. Ashton said -
Then, ought we not to say that, if a Federal old-age pension scheme is instituted, the revenue necessary to meet the cost should be raised by new taxation ?
The report continues -
Mr. PEAKE. Yes ; that is practically Mr. Kidston’s view, and we agree with it. We do not dictate to them on what it shall be raised.
– All except Tasmania are agreed that the question of old-age pensions should be taken up as a Federal matter, with the proviso attached that the Federal Government should, in any scheme of old-age pensions, provide the revenue by additional taxation for that purpose, not to meet the whole of the cost, but to go towards the cost.
We shall now see what Mr. Kidston had to say. He said -
We are ali agreed that it is incumbent on the Federal Government, if it adopts an old-age pension scheme, to provide the revenue required to finance it without trenching on the Customs revenue now returned to the States.
This Bill does not propose to trench on the revenue which the States now enjoy. What it. provides is that, if we impose new taxation for special purposes, we shall retain the whole of the revenue so derived. Mr. Kidston went on to say -
We can slop at that if you like, but we can go a little further, and express our willingness to agree with the proposal made bv the Federal Government at Hobart - that they should impose new Customs duties for the purpose of raising revenue for an old-age pension scheme.
The report continues -
Mr. PEAKE. We will not agree to tell them hew they shall raise it.
Mr. EVANS. So far as my opposition to the Commonwealth Government adopting an old-age pension scheme is concerned, I desire to say that it is wholly for the reason that, as regards Tasmania, the time is not opportune, but I am not against a Federal old-age pension scheme at the right time.
Then the following motion by Mr. Kidston was agreed to: -
That it is incumbent on the Federal Government, if it adopts an old-age pension scheme, to provide the revenue required to finance it, without trenching upon the Customs revenue now returned to the States.
Mr. Kidston, in the course of the debate, remarked -
We might add to that resolution, so as to make it clear, the words, “ in the event of special Customs duties being imposed for this purpose, the States will waive their claim to their three-fourths of those particular duties.”
– Does not the first sentence in the quotation from the speech made by Mr. Kidston, which the honorable senator has just read, seem to indicate that he considers the special duties should be limited to the raising of revenue for oldage pensions? Are the Government prepared to agree to that limitation?
– I do not think that we could insert such a limitation in the Bill.
– The Government might use the moneys so derived to build transcontinental railways.
– The revenue so obtained must be used for old-age pensions.
– Quite so. At page 129 of the report of the Sydney Conference, Mr. Kidston is reported to have said -
It is well to have it made clear that if the Federal Government adopt this method of raising revenue for old-age pensions - that is the imposition of special Customs and Excise duties - the States Governments are quite prepared to waive their claim to three-fourths of that special revenue.
– That is the whole object of the Bill.
– The honorable senator has hit the nail on the head. That is the only object of the Bill. It is a measure which we think ought to be carried. It might be argued, with perfect truth, that it will ante-date our powers by some four years. Undoubtedly it will ante-date them by that period. In 191 1, when the operation of the Braddon section of the Constitution will cease, we shall have the right to appropriate the whole of the revenue from Customs and Excise as we please. We consider it very advisable that old-age pensions should be paid on an absolutely uniform system throughout the Commonwealth. At present, I believe that only two of the States have made provision for the payment of old-age pensions, and in one of them the pension paid is 10s. per week, and in the other 8s. per week.
– What pension do the Government propose to pay?
– There will be plenty of time to deal with that when we are considering the matter. When we have the money for the purpose and have everything in trim, the question can be discussed as to how far the Commonwealth can go in providing for old-age pensions.
– I - Is not the estimate ?f ?l> 500,000 based on a pension of 10s. per week?
– I believe it is. I say that the existing state of affairs in connexion with old-age pensions should not be allowed to continue any longer than can possibly be avoided. It is grossly unfair to a number of our citizens. No matter whether they belong to one State or another, they are all citizens of the Commonwealth now, and the existing condition of things is grossly unfair to some of them who may have gone from one State to another, and may not have resided in a particular State for the period required, which, I think, is twenty-five years, to entitle them to a pension. Many of these persons are of the most deserving type. We believe that it is right that we should establish a uniform Commonwealth old-age pension system as soon as we possibly can. I dp not know of any State, of any Premier of. a State, and hardly of a single member of either House of the Federal Parliament, who is not in favour of old-age pensions. But as a Commonwealth we cannot give effect to our desires in the matter of providing a uniform system of old-age pensions unless we do one of two things. We could get some of the revenue required by an alteration of the Customs duties, but we could not get it all. We should then have to resort to what is known as direct taxation. The cry is for a land tax. I am not opposed to a land tax, and never was. I was the first tb introduce such taxation in my own State of South Australia, but I do object to a land tax which would double-bank the States that already have imposed land taxation. I could not agree to that under any circumstances. We have a fairly heavy land tax in South Australia. We have a progressive land tax there, and we have also a special absentee tax on those who have left the State. To impose a heavy Federal land tax on people who are already subject to land taxation by the legislation of the States in which they live would, I think, be very unfair. Certainly, land taxation is not uniform throughout the States. In some practically no land tax is imposed, and while it would be no great hardship for the people of those States to have to pay a Federal land tax, the addition of a Federal land tax would be a fearful burden for the owners of land to carry in those States in which a heavy land tax is already imposed.
– We could not expect the States to give up their powers in the taxation of land in order that the Commonwealth might tax it.
– I shall not go into that question now. We have under the Constitution the . fullest powers of taxation, direct and indirect, but these powers should be exercised with some . degree of consideration for the different States, and for the different forms of taxation to which the people of the States are subjected.
– I suppose that Federal land taxation would frighten capital out of the country.
– It would not do that, unless it were excessive, and I do not know that it would have that effect even then. I shall not go into that question. I say that the position which the Government take up in this matter was practically approved by the late Conference of States Premiers and Treasurers. They have said that they would be prepared to give up their right to three-fourths of the revenue which would be derived by the imposition of special duties of Customs and Excise for the purpose of providing a fund for the establishment of a uniform system of old-age pensions. This is one of the ways in which what is desired can be done. It will be for the people of the Commonwealth, by referendum, to say whether they will give the power asked for by this measure. The Government - and, for that matter, I believe, every Federal Government has been of the same opinion - believes that it is wise that we should pos sess this power; but we shall not be in a position to give effect to the general desire for the establishment of a uniform system of old-age pensions unless the alteration of the Constitution here proposed is agreed to. I ask honorable senators to assist the Government in referring this matter to the people, to enable them to say whether the Constitution shall be altered as proposed.
– Bef Before the Minister resumes his seat, he might, perhaps, state the particular items on which it is intended to levy the proposed special duties.
– No, decidedly not. We do not commit ourselves to any special items. It would not be fair to ask us to do so.
– Tea and kerosene.
– Tea and kerosene are the only items I have heard mentioned, and they have been mentioned by the States Premiers and Treasurers.
– How far would taxation on those articles go towards providing the fund required ?
– It is estimated that they would produce a revenue of £800,000. I have explained the position plainly. If we are to establish Commonwealth old-age pensions, and part of the money is to come out of revenue derived from special duties of Customs and Excise, the alteration of the Constitution proposed in this measure must be given effect to. That is the purpose of the Bill. If we should derive a revenue of £800,000 from special duties on kerosene and tea-
– What is the duty on tea on which that estimate is based?
– I cannot go into the details, but I believe it its 5d. per lb. Tea is more or less a poison. It is a luxury to some people, and if taken in excessive quantities it produces dyspepsia and all sorts of stomach troubles. Assuming that we raise £800,000 by special duties on these articles, and taking the Treasurer’s estimate that, if we do not provide for penny postage we shall have, at the closeof the currentfinancial year, £500,000 to return to the States which we are not obliged to return to them under the Constitution, that would account for £1,300,000 out of the £1,500,000, which, it is’ estimated, would be required as a fund for the payment of old-age pensions.
– If this Bill should become law, would it be possible for the Government to divert revenue derived from duties on whisky or tobacco for the purposes of this fund by an Act of Parliament?
– No, because the Constitution provides that three- fourths of the revenue derived from taxation on those articles must go to the States.
– But with the authority of this measure, would it be possible to divert revenue from any large revenueproducing items in the way suggested ?
– No. If honorable senators will examine the Bill they will see that it provides plainly enough for special duties of Customs and Excise on goods which are not liable to Customs and Excise duties on the 1st day of January, 1 907 . So that we could not dip our hands into the revenue derived from Customs and Excise duties now levied. Three-fourths of that revenue must be reserved for the States. In this Bill, we are asking the Senate to agree to submit the proposed alteration of the Constitution to the people to enable us to provide the necessary funds by the imposition of new duties, so as not to trench upon the revenue to which the States are entitled under the Constitution.
– If we impose special duties on tea and kerosene, shall we not be taxing the people to whom we are afterwards going to pay pensions, seeing that it will be the poorer people who will have to pay the bulk of that taxation ?
– I believe that the people who will get the pensions -should contribute a trifle towards the fund required to provide them. However, i leave the question to be decided by honorable senators. The object of the measure is .plain,, and.it is for them to say how the will vote in regard to it.
Debate (on motion by Senator Col. Neild) adjourned.
The Clerk laid upon the table the following .paper : - -Return to an Order of the Senate, dated 30th August, giving a copy of the petition relating to Ahc Eastern Extension Telegraph’ Company, and the names of the signatories thereto ; together with a copy, of the Postmaster-General’s reply.
Senate adjourned at 10. 4$ p.m.
Cite as: Australia, Senate, Debates, 24 September 1906, viewed 22 October 2017, <http://historichansard.net/senate/1906/19060924_senate_2_35/>.