8th Parliament · 1st Session
The President (Senator the Hon; T. Givens) took the chair at 3 p.m., and read prayers.
The following papers were presented : -
Audit Act. - Regulations amended - Statutory Rules 1921, No. 49.
Science Act, - Regulations - Statutory Rules 1921, No. 82.
Inscribed Stock Act. - Dealings and transactions during year ended30th June, 1920.
Memorandum relating to . the retention of members of the Australian Garrison Artillery in Australia during the recent war.
Papua.- Ordinance No. 16 of 1920- Customs Tariff.
Camps of Training
– I ask the Minister for Defence if his attention has been called to a paragraph which was published in the Age of 30th April, 1921, which purported to report a statement made by Mr. Poynton, Minister for Home and Territories, in Sydney, to the effect that the matter of defence is in a state of flux. According to the paragraph Mr. Poynton made the following statement-
-Order! The honorable senator must not read a statement in asking a question.
– I ask the Minister for Defence if he has had his attention directed to this statement, made by Mr. Poynton -
The Department of Defence is in a state of flux-
– Order ! The honorable senator is not himself entitled to make a statement in asking a question, much less to quote a statement made by some one else.
– I ask the Minister if it is a fact that a statement was made by Mr. Poynton, in which he said that the Defence Department was in a state of flux, and that the seventy days’ training proposal, provided for in the’ Defence Bill at present before the Senate, is to be brought into effect by regulation when the Prime Minister (Mr. Hughes) returns from the Imperial Conference.-
– The honorable senator drew my attention to this matter, and as my reply to his question may somewhat exceed the reasonable length of an answer to a question without notice, I ask permission to make a statement. (Leave granted.) My attention was called to the paragraph referred to.’ I telegraphed as follows to Mr. Poynton; -
Melbourne Age reports interview with you Sydney making statement seventy days’ military training proposal would be brought in by regulation when Prime Minister returned from Conference. Decision of Cabinet was consideration deferred until’ Prime Minister returns. Cannot be brought in by regulation. Are you correctly reported?
I received the following reply from Mr. Poynton, dated Srd May: -
Report in Melbourne Age incorrect. My statement to press was that proposal referred to had been deferred till Prime Minister’s return, I made no mention of regulations.
On receipt of that message I immediately rang up the Age office, and asked to be put on to the chief of staff. I was unable to get him, but the gentleman to whom I spoke promised that any correction I wished to make would be brought under the notice of the chief of staff or the reporting staff. Then I gave him the correction, which he took down, and* in order to make sure that he had it accurately he repeated it to me over the telephone. That was on the Saturday; but the correction did not appear in the following Monday’s issue of the Age. On the Tuesday I saw a representative of the Age at the Commonwealth Offices, and drew his attention to the fact that the correction had not appeared. I again gave it to him, and asked him to take it to the office. I presume that he did so, but the correction has not yet appeared in the Age. That it had reached the Age office is, I think, proved by the fact that it was telegraphed from Melbourne, not by me, but apparently from the Age office, to a Sydney newspaper. The, correction appeared in the Sydney newspaper, but it has not appeared in the Melbourne Age.
– I ask the Minister for Defence if his attention has been called to a cartoon, representing himself and Senator Pratten, appearing in the Sydney Daily Telegraph of Saturday morning? Ifso, has he any regulation by which be can intern Senator Pratten for appearing in a cartoon in uniform?
SenatorFOLL. - What is the principle being adopted in connexion with the reduction of staff in the Repatriation Department? Has there been any rules laid down, such, for example, as whether the last man taken onshall be the first to be retrenched? Or is the whole matter entirely in the hands of the Deputy Commissioners in the various States!
– The administration of the Act is, as provided in the Act itself, under the control of the Commission.
SenatorFoll. - That was the most foolish provision we ever made.
– You were not satisfied with the administration of the Minister.
Statements by Senator Elliott.
– In the course of debate on the Defence Bill, in this Chamber, Senator Elliott made certain allegations in regard to an officer of the Permanent Forces, and, also, on another occasion, with respect to Major-General Hobbs. I was subsequently asked by an honorable senator whether I would obtain a report based upon the allegations of Senator Elliott. In order to enable me to place the Senate in possession -of those reports I ask to be permitted to make a statement.
– The first indicated statement, having to do with a permanent officer in Tasmania, is evidently aimed at Colonel D. P. White. I did not hear the remarks of Senator Elliott, but Senator Duncan afterwards drew my attention, in this Chamber, to the a legations. I, thereupon, had the remarks looked up in Hansard and drew the attention of the Military Board to- Senator Elliott’s statements. I asked that the Board should make inquiries and report. The report reads as follows: -
The Minister has drawn the attention of the Military Board to the accusations made against an officer of the Staff Oorps by Senator Elliott in the Senate on Thursday, 28th April (see Hansard of 30th April, page 7837). The Board asks that the statement be refuted.
The officer obviously, referred to is Colonel D. P. White. This officer has twenty-nine years’ service in the Permanent Forces, and served in command of the 13th Light Horse Regiment of the Australian Imperial Force from May. 1917, until the end of the war.
The Board has made inquiries, as a result of which evidence is obtainable that the charge of drunkenness in France made by Senator Elliott against this officer is entirely unfounded. The evidence in possession of the Board is that throughout his war service this officer was of temperate habits. Many years ago, however, Colonel White suffered a serious accident, as a result of which one side of his body was paralysed. In course of time he recovered sufficiently to resume service. He has remained, however, afflicted with a resultant lameness and slight speech impediment. These infirmities are widely known throughout the Forces, Colonel White’s long service having brought him into contact with many officers in all parts of the Commonwealth.
– To whom do you refer when you speak of the Board ?
– The members of the Military Board, sitting as a Board.
– Who are they?
– They consist of General Sir Brudenell White, . General Forsyth, General Sellheim, and Colonel Thomas, the finance member.
– And General White is a brother of Colonel White.
– In regard to the allegations made by Senator Elliott concerning Major-General Hobbs, those statements were of a very serious character. Senator Elliott had quoted from a report which he had addressed to Major-General Hobbs, and he then said -
Three weeks later General Hobbs called to see mc. He said. “ I want to speak to you privately,” and took me out into the’ garden. !e then said to me, “ General, I have instructions to tell you that while you are in the Australian Imperial Force you will receive no further promotion byreason of your conduct to the officers.” When he said that, I turned away rather dumbfounded, and he struck me on the back and said, “ I have got to tell you that; but, by God, you were right.” It turned out that this staff officer was the son of a duke, and “ put the acid “ on General Birdwood for my conduct, and you see the result.
I thought that, in justice to MajorGeneral Hobbs, and to the Senate, his attention should be called to that statement/ by Senator Elliott, and therefore, directed the Secretary for Defence to send the following telegraph message to Major-General Hobbs -
See Federal Hansard, 21st April, 1921 (page 7560), at office Commonwealth Public Service Inspector, speech by Elliott statement attributed to you. Minister would like- your remarks thereon. Message ends.
On the 3rd May, I received this reply -
Your WG272 dated 27th April. Have no recollection of making statements alleged by Elliott. But I remember slating him after receiving most indignant letter from British Division Commander complaining of General Elliott’s insulting conduct to officers of his division, though I consider Elliott received great provocation. I certainly had no instructions from higher authority to inform Elliott he would receive no further . promotion. (Signed) General Hobbs.
– He does not say that he did not make the statements referred to.
– That was not the charge. The charge was that he had received instructions.
– I ask permission to make a statement regarding the wool position; and, if leave is granted, I propose, in order that the matter may be discussed, to lay a paper on the table, and to conclude by moving that it be printed.
– I donot know that it is necessary to detain the Senate for long since the matter to which I arn about to refer has occupied public attention somewhat acutely for the past few weeks; and I am convinced that all honorable senators have made themselves fairly conversant with the various aspects of the subject. Neither is it necessary for me to refer, except briefly, to the gravity of the position. The wool industry is - one may say - the king-pin in our industrial and commercial waggon;, and, obviously, that pin cannot be disturbed, much less destroyed, without bringing about serious consequences to all sections of the community. I pass from that reference with a statement in regard to which I anticipate there will be general concurrence, namely, that nothing can seriously affect the wool industry which does not also affect every individual, every section, interest, trade, occupation and institution in this country, ‘ and - necesarily also, and very seriously - the finances of the country itself. The Government, in approaching this problem, did so very firmly convinced of the desirableness of allowing trade, as far as possible, to revert to uncontrolled, normal pre-war conditions. But, at the same time, it feels that it could not stand by, idle and’ unmoved, when the most i important of our national industries - most important because of its magnitude - is threatened with what I am bound to describe as disaster. The Government kas had to consider whether it is not bound, in the circumstances, to see if any help which it can render may do something, if not to avert the trouble, then, at least, to minimize it. I do not propose to worry honorable senators with figures. Statistics have been quoted very freely by almost all who have participated in the discussion of the wool position ; but figures, after all, merely express facts. The facts of the problem, as I view them, are these : During the years of war there have been accumulations of wool, representing very many millions of pounds, and in addition there is growing, every day of every week, additional supplies of wool which are coming into the market in a continuous if an irregular stream. At the same time there is, in consequence of the waxstricken condition of Europe primarily, and the world generally, a considerably reduced world-purchasing power. It may be doubted if the purchasing power of the world to-day is equal to the absorption of the daily production of wool. It is quite clear, therefore, that it is not ©quai to the absorption of the accumulations to which I have referred. In a communication which he submitted to the Government, Sir John Higgins, the Chairman of the British- Australian Wool Realization Association, summarizes the position thus : -
If the wool market were to be flooded with the present surplus, financial institutions and wool houses that have advanced on grazing properties, sheep, and wool clips, would find that their securities had, to a great extent, disappeared. We could expect failure and insolvencies all over the Commonwealth. Sheep breeding and wool growing would cease to be practicable as commercial enterprises in Australia, except under special conditions. This fact must be faced, viz.: - That it will take some years to absorb the large surplus of wool, together with current production, hence the initiation of the scheme for restoring confidence must be founded upon absolutely sound principles. The only solution of the problem appears to be in the direction of so stabilizing the industry as to give the grower a reasonable price, based on production costs, and the manufacturer security as to the requirements of raw wool, regularity of deliveries, and moderate market rates.
That, I submit, in a terse form, sketches the position to-day. It is obvious that if the whole of this accumulated wool, plus the current production, is thrown upon an unregulated . market the inevitable result must be that the market will fall to pieces, or to use a common phrase, the bottom will drop out.
– I think it has dropped out already.
– There is a semblance ‘ of some bottom to the market yet, and. an attempt has been made to stabilize the market by the formation of the British.Australian Wool Realization Association, popularly known as “Bawra.” The scheme upon which the association was founded is breaking down. I do not know that I would be going very far beyond the truth if I said it had broken down, but whether it has or not, it is quite clear that it is on the verge of breaking, and it? failure primarily, at any rate, arises from the fact that a few individual wool-growers in Australia declined to cO-operate with Bawra. They are very few in number. It is well that honorable senators should know how few. They represent 6 per cent, of the growers, and are responsible for 10 per cent, of the wool involved. Although the percentage, expressed in this way, is very small, it is obvious that with wool as with any other commodity, a few producers coming into the market can disturb, and indeed destroy, the very underlying principle upon which Bawra was instituted. Many solutions for the difficulty have been offered - solutions ranging all the way from the grotesque to the impracticable. The Government as far as it is able, has examined all these proposals. I am not aware of any scheme submitted which has not had close attention. But in examining these proposals the Government also felt it to be its duty to consider the standing of those responsible for them, their knowledge of the problem, their intimacy with the trade, and their competency to’ tender adVice. Having done all this, the Government ha, come to the conclusion that the scheme formulated by Bawra is open to the least objection, and carries behind it the largest volume of opinion of those whose judgment is entitled to respect. At a conference held some time ago of the various bodies which are supporting the Bawra proposal the following were represented : - The Central Wool Committee; the Pastoralists, Graziers and Farmers Association; Wool-Growers Association; National Council of Wool Selling Brokers; Meat Exporters Association; Fellmongers Association; and the Associated Banks of Victoria. These bodies represent a very wide range of interests and, it may be presumed also, they include large numbers of those who are especially competent to tender advice.
– Can the Minister give the names of the gentlemen who represented those bodies ?
– The honorable senator will find the names in the paper which I am laying on the table of the Senate. I must say that the Government does not pretend that it accepts the proposal submitted by Bawra with any robust confidence.
– What proposal is that?
– The one submitted by Bawra; and, notwithstanding the honorable member’s question, I feel sure he is as familiar with it as I am. The Government, as I have said, d’oes not pretend to accept the proposal with any very lively confidence, but any doubts it has on this point are intensified regarding the alternative proposals. It is not submitted that the Bawra proposition represents any royal road to success, but it is the most promising of the many schemes that have been submitted’. The Government is also influenced by the fact that behind tha Bawra scheme is a large number of those whose direct interests are involved, who may be credited with some special knowledge concerning the problem, and who have certainly given it continuous and prolonged study. These are factors which the Government cannot ignore in endeavouring to shape its own judgment as to the proper course of action. The proposal submitted by Bawra is that, while any wool-grower may do as he likes with his product, subject to the condition that if he exports he must agree that it shall not be sold abroad except under condi tions prescribed by Bawra. These conditions involve limitation as to the supply to be offered from time to time, and some limitation as to the minimum price at which the wool may be sold.
– It does not interfere with local sales?
– No. But it is not much good selling in a free market here, if outside Australia sellers are tied up. The Bawra proposition was that the reserve price under which export would be allowed should not be less than a figure represented by a flat rate of 9d. per lb. The Government is not at all. disposed to exercise any power with which it may be vested with the idea of enabling even such an important industry as wool growing to exact an unfair and unreasonable profit from the consumer. It felt that the price at which growers should be asked to sell should bear some reasonable relation to the cost of production. From inquiries made, and examination - of statistics, it appears thai the cost of production in Australia is in excess of 9d. Bawra put up a proposition that- the reserve price be 9d. The Government, however, in ,view of all the circumstances, and with a desire to pay due regard to the consumer’s point of view, recommended that the Bawra price should be 8d. This is the proposition which the Government ask the Senate to consider and, I hope, approve.
– Did I understand the Minister to say that the Conference indorsed this scheme?
– It indorsed the main proposition. I may add that the Associated Banks of Victoria - not all the banks - were represented, and subsequent negotiations with the banks have drawn this statement from them : They say, in effect, that they have no objection to this proposal, but are not disposed to do anything in the way of coercing their clients to fall in with such an arrangement, because they must please themselves. I am submitting this as the proposal of the Government, and trust we shall be able to secure the co-operation of the Senate in giving effect to it by indorsing the policy.
– Will legislation be necessary?
– No, but it is competent for the Senate to express an opinion by signifying its assent to or dissent from the -motion I am about to submit.
– How do the Government propose to exercise their powers ?
– By regulating and prohibiting export except under these conditions.
– Through the Customs ?
– Yes. It is an extraordinary use of power to meet an extraordinary situation.
– It is a very dangerous precedent.
– Every precedent is dangerous when one seeks to do something that some one else does not like. It is a dangerous precedent to pull down a house, but it may be necessary to save one adjoining from burning. All the objections I have mentioned apply to the other alternatives submitted with the exception of one.
– Why not do this by Act of Parliament instead of by regulation ?
– Hear, hear !
– The Senate can discuss that phase of the question.
– That is what was done in connexion with the- Butter Pool last year.
– The Senate can discuss such a proposal, and the Government will pay every respect to its views. But time is a very important factor indeed.
– What is the difference between an Act of Parliament and a regulation?
– There is very great difference. The Minister of Customs, under regulations, can prohibit the import or export of certain commodities.
– I appeal to Senator Thomas, who is usually so amiable, not to disturb the situation.
– I am amazed at Senator Fairbairn making such a suggestion.
– The honorable senator has great aptitude for developing amazing situations. I am submitting the proposal of the Government so that the question may be fully considered, and in the hope that we shall have the co-operation of the Senate.
– Is any time stated?
– The proposal is that this regulation shall apply for six months. What happens after that must be determined by the circumstances as they develop. I want to stress the importance of the fact that whatever steps the Senate decides to take, every day is of great consequence to Australia. We have already lost one series of sales owing to the disturbed condition of the market, and, if it is decided to do anything, the sooner our policy is known the better. If nothing is to be done, even as a palliative, the sooner we apply that palliative or remedy the better it will be for every one concerned. I move -
That the paper be printed.
.- I am pleased to learn that the Government have decided to accept, to a large degree, the recommendations of the BritishAustralian Wool Realization Association, known as “ Bawra.” I am afraid I shall have to detain honorable senators this afternoon at some length because I have been asked by some of them at all events, to explain the whole position of the wool industry at the present time. I have been requested to deal with the recommendations of Bawra and what the Government intend doing. The matter is of vital importance to Australia. It is in no way a party question as it affects the whole of the Australian people, and not only the 80,000 wool -growers in the Commonwealth. It is well for honorable senators to consider the colossal task ahead of Bawra in view of the quantity of wool to be handled. Bawra is handling on behalf of the Australian growers 850,000 bales of stale wool, that is, wool that has been paid for, but which is Australia’s share of the profits from the wool scheme conducted during the war period, when the clip was sold at 151/2d. per lb. plus 50 per cent, of the net profits on any surplus wool sold which was not required for naval or military purposes.
– Those profits were in kind and not in cash.
– Yes, because the cash was not realized. Some of the profits were taken in cash, and I understand that £5,000,000 will be distributed before 31st July to growers with wool in Bawra.
Small growers whose interests are. under £100 will be paid off in cash which will take another £600,000.
In addition to the 850,000 bales of stale wool there are 850,000 bales held for the Imperial Government, 1,000,000 bales of the 1920-21 clip still unsold, and on hand in Australia, plus 800,000 bales of New Zealand wool ex pool, which with the 400.000 bales of New Zealand wool ex 1920-21 clip still on hand makes a total of 3,900,000 bales.
– Are the New Zealand growers represented on Bawra?
– We understand that the New Zealand Government, have, at the request of the growers, practically decided to come in. I do not know whether the Government have any definite announcement to make in that regard.
– We can only confirm the honorable senator’s statement.
– I am told on the best authority that the New Zealand growers are anxious to come under the operations of Bawra, and that there is a possibility of making it an Empire affair by South Africa coming in.
– New Zealand was not in the original Pool.
– New Zealand had a Pool of its own. With the 2,500,000 bale clip practically in sight from Australia and New Zealand the directors of Bawra will have 6,400,000 bales with which to deal. I give these figures because exception has been taken, both in- the press and elsewhere, to the salaries to be paid to the directors of Bawra. Their action in accepting such salaries has been very’ adversely criticised in some quarters, but they have been working -
– For a long time.
– Exactly. They had been working four and a-half years for nothing, and the organization which has been set up to deal with 6,400,000 bales of wool is going to have a very busy time. This is a question of vital importance and aft effort is being made to stabilize the industry. I am going to take objection to the Government suggesting, or .declaring their # intention, to . reduce the minimum reserve price from 9d. to 8d. per lb., because we know that the cost of production in Australia for the last four years has averaged 10.94d., or roughly lid. per lb:
– Does that mean that the poor wool growers have been making, a profit of only 20 per cent. ‘(
– Admittedly they did very well during the four years of war, but it must be remembered that if they had disposed of their wool in the open market it would have brought, more like 31d. per lb. than 15£d. per lb.
– It is a minimum of 8d.
– There is no fixation of prices at all. It is a minimum reserve.
-. - Not a flat rate?.
– It is not a flat rate. The wool will be sold by auction and will be purchased by any one who requires it. At an. average price of 8d. or 9d. per lb. plenty of -wool would be sold at Jd. per lb, and the top price would be about 18d. to 20d. per lb.
– That corresponds to the flat-rate of ls.. 3$d. per lb. at which wool was sold during the war.
– The whole scheme will be upon a similar basis to that which was in operation during the continuance of the Wool Pool. There are 848 varieties of wool in Australia, so that there must necessarily be many varying prices. Some wool will probably ‘be worth, less than Jd. per lb., but not, of course, fleece wool.
– The minimum reserve price to which the honorable senator has referred will represent the mean price?
– Yes, the mean reserve price. The wool will be sold by auction, bo that if Russia or any country comes along and offers us 2’0d. per lb. for it, we shall not refuse ner offer. I consider that the total value of the exports of raw commodities from Australia during the next .three years will not amount to 50 per cent, of ‘ what they have been during the past three years. With falling exports we must have enormously reduced imports, and consequently the money which we have been collecting from Customs will very materially decrease. In the near future I do not think that the Government will have many incomes to tax. Certainly no man upon the land will have a taxable income. The importers, too, are in for a very rough time, and so, indeed, is everybody else. . I have heard very many people talk in a loose fashion about wool; but I am glad that the Ministry realize that the wool industry is the staple industry of Australia.
– The Aye does not realize it.
– Several newspapers do not. They have never had a kind word for this staple industry in their lives. During the past three years we have been receiving an average of £4:7, 823,000 annually for our wool. This year, the amount derived from that source will fall to between £15,000,000 and -£18,000,000, and if some steps be not taken to prevent the market smashing entirely, it is probable that next year this staple commodity will not return us more than £10,000,000. A similar remark is, to some extent, applicable to meat. During ‘ some past years we have been getting £10,000,000 annually fram the export of meat. But owing to the present cost, of freight, and the slump in meat upon the other side of the world, we shall not export very much of that commodity during the next year or so.
– And metals occupy a very similar position.
– How far will the production of wool in the Argentine affect the world’s markets?
– That question has been brought before the Bawra directorate. If we put a reserve price upon our wool, our great competitor, the Argentine, which produces only crossbred wool of a relatively inferior quality, may undersell us.
– Is the cost of production -in the Argentine lower than our own cost of production ?
– It is a good deal lower than ours upon freehold land, but the difference is nob so much upon leasehold land. The wages which are paid in the Argentine are very much lower than are the wages paid here, and land values there are also lower. But Argentine wool is relatively of a very inferior quality, and if its people are going to undersell us, they will have to accept- less than 3d. per lb. for their product, because even with an average re- serve of 9d. per lb., much of our wool will not realize more than 3d. per lb.
– The Government’s suggestion is that the average reserve price should be 8d. per lb.
– Yes ; I main-, tain that that is too low a price alto*gether. Our city dwellers, and some 0f’ our newspapers, do not appear to realize that all Australians live upon the primary products and the primary producers of this country. They do not realize that the humble sheep, which is so much abused by street-corner orators is responsible for 41 per cent, of the exports of the Commonwealth. The necessity to support Bawra arises from the fact that its organization is so great, and that it will endeavour to find and develop markets for our wool. Nobody is stupid enough to pretend that the fixing of a minimum reserve price for our wool when we produce only 25 per cent, of the wool of the world will for certain prevent the collapse with which we are threatened. But it will at least accomplish something. - We can, at all events, dictate in regard to merino wool, of which we produce 50 per cent, of the world’s total production.
– Did 1 understand the honorable senator to say that there are 80,000 wool-growers in Australia!
Senator- Crawford. - They cannot all be. wool kings, then.
– No. I have no sympathy for the wool kings of this country, because they have been enjoying a very good time for some years, and are consequently in a position to live, so to speak, upon some of their own fat. But statistics disclose that the majority of .flocks in the Commonwealth are held in small numbers. It is the duty of the Government to protect the industry from extinction. We hear a lot of talk about the basic wage for the workers in our cities. But it is our duty to try and assure to the primary, producers of this country, to the men who have to work twelve1 and eighteen hours per day, a living wage. The man who works upon the land is the worst paid man in Australia considering ohe hours he works.
– He is sweated.
– Absolutely. At the same time, it is necessary to encourage manufacturing, but we ought not to overfeed manufacturers with artificial foods, i.e., over protection. The woollen ‘ manufacturers of this country have enjoyed extraordinary privileges in thepast,andtheyhavenot taken that advantage of them which might havebeen expected, considering that for many years their profits over thewhole of Australia netted 33 per cent. on their capital. Under the great appraisement scheme they were allowed to take the first choice of the wool at the appraised price - I do not suggest, that the Prime Minister was not right in insisting upon this condition - and which meant an advautage equivalent to a free gift to them of several hundreds of thousands of pounds. . Yet today our manufacturers are taking only 5 per cent, of our wool production. It is our duty to encourage in every possible way the expansion of the wool-manufacturing industry in Australia. The stabilization of the market will tend towards that. This move on behalf of . the Government is not one of price fixing. It is not intended to lift wool to an artificially high price, but merely to protect the industry and Australia from ruin. This stabilization will suit everybody except the speculators. Nearly all the propaganda which has been fired into honorable senators during the past two days has emanated from speculators, who would no doubt like to see the market price of wool down to 3d. per lb. Then they would put a few hundreds of thousands of pounds into it, and it would be a very good speculation. As a matter of fact, I know that syndicates have been formed for the purpose of buying wool, at perhaps one- third of the cost of production, and holding it for resale.
What is Bawra, and who are Bawra! It is right that the people should know that Bawra is the British and Australian Wool Realization Association, which has’ a capital of £22,000,000. That is the estimated value of its assets. Its Australian interests are safeguarded by the fact that there are six directors in Australia as against five directors in London. The Australian directors are Sir John Higgins, who did such magnificent work for this country throughout the continuance of the Wool Pool, and accepted no pay for (hat work; William Stevenson Fraser, Melbourne, Managing Director Younghusband Limited, Vice-Chairman of Commonwealth of Australia Central Wool Committee; William Allan Gibson,
Melbourne, General Manager Goldsbrough, Mort and Company Limited; John Mackay, Sydney, pastoralist, President Graziers’ Association of New South Wales; Charles Robert Murphy, Melbourne, pastoralist, Chairman Australian Wool Council; and William Riggall, Melbourne, solicitor, of Messrs. Blake and Riggall. Honorable senators will realize from the. calibre of these gentlemen that Bawra is well staffed. ,
– How does a solicitor come into the business?
– Because it is advisable to have a legal man on the directorate of an organization that is going to deal with 0,4.00,000 bales of wool.
– Is there any representative of the consumer on the directorate)
– The consumer will be very well protected, if, as I hope, the result of this proposal will be the stabilization of prices. The members of the British Board of Bawra are Sir Arthur Home Goldfinch, K.B.E., DirectorGeneral of Raw Materials, ‘Caxton House, Westminster ; Sir John Ferguson, K.B.E., Joint General Manager Lloyd’s Bank, 71 Lombard-street, London; Francis Willey, Wool Merchant, Blyth Hall, Nottinghamshire; Henry Ernest Davison, secretary Dalgety and ComSany Limited, 4.5 Bishopsgate-street, Lonon; and James Alexander Cooper, Fellow Society Accountants,Caxton House, Westminster. With such directors, honorable senators may have confidence that the job intrusted to them will be fairly well looked after.
– I understood from the Minister for Repatriation that Bawra has already broken down.
– The organization has broken down, to a certain extent,, through the selfish action of a small section of graziers and the action of a couple of banks in London.
– That is a matter of opinion.
– Those banks virtually agreed at the last two series of sales that our wool should be valued at a certain price, and they would stick to the reserves, but they did not do so. They took advantage of the position and solid wool in London, perhaps grabbing the cash and reducing their clients’ overdrafts.
– They “ blacklegged “.
– Tes, they “black-legged,” if you like to call it such.
– They arc nonunionists.
– They were nonunionists. The purpose of the present proposal is to bring back the few who broke away. Honorable senators may call them “ blacklegs “ if they please; but, as I might have an overdraft from cue of them, I shall not use that term. At all events, they did not play the game.
– I think the honorable senator is wrong.
-What is wanted is to give the Government and Bawra the power to force those people into line. I have brought the matter up for discussion, because it is necessary that they should be brought into line. Why should 5 per cent, or 8 per cent, of the people interested, in wool be allowed by their action to break down the greatest industry we have? Why should they be allowed, to act contrary to the frequently expressed will of 95 per cent, of the producers of wool ?
– Senator Fairbairn says that the honorable senator is wrong.
– I am sorry if Senator Fairbairn: should think so.
– I think the honorable senator was wrong in his reference to the banks: I will explain the matter when I speak on the motion.
– I know that the banks to which I refer have imported wool to Loudon and did sell below our reserve. I know that they did sell free wool on the market below tho prices arranged. I admit that they considered they had uo jurisdiction to interfere with the wool which was sent to them by their clients for sale.
– Did Bawra finance the wool-growers for the wool they hold ? .
– Bawra financed them to this extent, that it has already paid them some dividends out of profits on woo) sold. .
– But I refer to the 6,000,000 bales that Bawra is handling now.
– Bawra proposes to finance the- growers to a certain-1 extent by tho issue of bonds to the . value of £10,000,000, and by tho issue of scrip to the value 0f £12,000,000. I have no doubt that the bonds will be negotiable, and will be, worth their face value; but no one can say what the scrip will be worth, because that will depend on the prices that will be realized for wool. I hope that with the help of the Bawra organization, supported by the Government, a reasonably good rate will be realized.
– I think that Senator Earle wishes to know what is happening in regard to new wool.
– It is in order to prevent the new wool becoming unsaleable that the Government are taking the action they propose.
– Is Bawra paying anything for it as the wool is received ?
– No, Bawra is not paying anything for it. It is receiving the wool for sale in the world’s markets by public auction. Men can sell the wool anywhere. There is no proposal to prevent a grower selling on his farm if he wishes to do so, in Melbourne, or in any other part of Australia, through the fifty-nine Australian warehouses, on the London market, in America, in Italy, or anywhere else, provided he gives a guarantee that he will not sell it below the equivalent of 9d. per lb. - if 9d. is agreed upon - gross in Australia. I should like to point out to honorable senators that this represents only 8d. on the farm. That is why I object to the Government’s proposal to reduce the flat rate from 9d. to 8d., because that would represent only 7d. on the farm, which would not pay for growing the wool.
– Does the honorable senator say that there are fifty-nine wool warehouses in Australia?
– If we have a fixed price for wool, of what use are the fiftynine agents?
– It is not a fixed price that is proposed. I have tried to explain that. The Government do not for a moment intend to fix the price of the wool.
– Will there be official appraisers for each lot of wool ?
– Yes, each lot of wool will be appraised by three thoroughly qualified and sworn experts.
– With an appeal.
– Yes, I understand an appeal is to be allowed. Each grower will get what his wool is worth in the ratio of 8d. or 9d., whatever the minimum price agreed upon may be. I hope that it will be 9d., which, I repeat, is equal to 8d. on the farm, as freight and selling charges will amount, on the average, to 1d. per lb.
– There is to be a fixed minimum price.
– What is proposed is that there should be a minimum reserve, and all wool is to be sold by public auction. ‘ If the honorable senator cared to offer20d. per lb. for wool his offer would be welcomed.
– I have no doubt it would.
SenatorJ.D. Millen. - I understood the honorable senator to say that’ some wool would be sold at1/4d. per lb.
– That is so, some wool will be sold for1/4d., but the whole clip will be so appraised that- there will be an average reserve price equivalent to 8d. or 9d. per lb., whichever the Government may decide upon.
– How are we to control the prices of wool in Australia through the Customs House?
– There is machinery in the Customs Act to enable that to be done. A grower will have to sign a declaration that he will not sell wool, and a buyer a declaration that, he has not bought wool, below the average fixed for the whole clip.
– That is for export purposes.
– Or for local consumption purposes either. The same thing was done while the Wool Pool was in existence, and the price was fixed at 151/2d. as an average. The Australian clip was divided into 848 types and there were over 600,000 odd lots, and the experts appraised that wool on a ratio of 151/2d., and, when they came to make the calculation, it was found that it realized within a few decimal points of 151/2d., and the difference was made up to the average of 151/2d. decided upon. The same machinery is available now for the sale of wool.
– Is it proposed that the 6 per cent, of wool-growers who have, so far, not come into the scheme shall be prevented from selling wool cheaper than the ratio of 9d. per lb..?
– No doubt they think they have been very clever and are getting the best of the odds., They rushed in and have taken the money, doubtless because they wanted it rather badly. Some one may have forced them to sell. That is all very well while the market is good; but, if we permit the whole structure to be undermined, if we allow the” speculators and syndicates to do what, they wish to do and bring about a smash so that foreign buyers may be able to purchase wool at 25 per cent, of the cost of production, we shall bring about a collapse of the industry. That is the reason why it is so necessary to bring these selfish men into line and why the Government intend to do what they propose.
– The people referred to seized the life-boats to save themselves.
– Yes. Honorable senators must realize that if wool collapses it will mean the ruin of the country.
– That is admitted on all hands.
– If this proposal is agreed to, when may we expect complete de-control of wool?
– When we reach some semblance of normal times, and the markets of the world can be encouraged to absorb the overplus of wool -with which we are at present faced. If we allow the wool position to collapse the whole of the securities of Australia will collapse - wool, skins, stock, land, and wages, which latter is important for Labour men to know. If the wool position collapses, the consequent unemployment will be very great. To show what it may be, I may say that already, because of a decline in the price of wool, there is considerable unemployment. In shearing a great many men are employed at high wages, fixed by arbitration. Those wages are too highin view of the present prices obtained for wool. There are a great number of wool sorters and other people employed to prepare the clip for market. This work has to be cut out at present prices, as it would not pay to elaborately prepare wool for market at 8d. per lb. This means that a number of men are thrown out of employment, and the higher the minimum price fixed the better it will be for the credit of Australia and for the employment of men in the wool industry.
– I understood the honorable senator to say that wool would be sold at an average of from id.’ to 18d. per lb. What would be the minimum price at which the wool would be sent in?
– At its- worth, in the ratio of 8d. or 9d. per lb.
– Then some would not be worth sending in. .
– Even under the Wool Pool scheme, with an average appraised price of 15Jd., some wool sent in was declared to be of no commercial value. Some of it was sent to be fellmongered to give it a commercial value, and even then had to be sold as low as Jd. per lb. I hope that the sale of wool under the scheme now proposed will be carried out under the same, principle. It was in 1818, or over 100 years ago, that the first sale of Australian wool took place in England. We have been selling wool in Australia for ov.er seventy years. We have a splendid selling organization here now. Some vested interests in London desire the Bawra scheme to break down. The Australian wool selling industry has provided work for thousands of people in wool stores; it has provided commission for Australian brokers, and a section of the trade in London is exercising a strong pull to make the scheme a failure, in order that some persons in London may be able to realize considerable sums from the sale of wool as they did some years ago. The selling firms in Australia are a splendid lot, who have wonderfully fine buildings. Wool is much better displayed in Australia than it is in any other part of the world. The buying houses also deserve every credit. They have played the game, and have tried to help the industry.
– Is the honorable senator referring to the Victorian Association ?
– No; to “ the whole of the buyers. I am aware that some of the Victorian section are objecting to this scheme, but I hope to prove to honorable senators that they . are wrong in doing so.. As Senator E. D. Millen has said, we know that what is now proposed will not be a complete cure for the tremendous slump that has taken place in the price of wool and most of our raw productions, but it is at least an effort to do something to provide a remedy.
– Considering the present price of woollen goods, would it not be a more effective remedy if a few more factories were started to consume wool in Australia?
– We have many factories already in Australia, and they consume only 5 per cent, of our production. If it were possible to double the number with’ a wave of the hand, they would still absorb only 10 per cent, of our annual production.
– There was a scheme put forward to absorb one-third of Australia’s production. o
– That is so, and I believe in it. It is away in the offing just now, however, although I hope it will come to us some day. Ten per cent, of our wool would supply the woollen goods for the whole of the people pf Australia. The idea of the Bureau of Science and Industry is not only for the manufacture of goods in Australia for the Australian people; it goes beyond that. It is a crime that, here in Australia, where we produce the most, the best, and the cheapest wool in the world, wo should still be importing more than 50 per cent, of our woollen material requirements. But, as I have just said, the proposal goes further, in that it looks to the manufacture of Australian wool, in Australia, for Australia, and also to supply other parts of the world. I do not expect to see that in my day, but I hope to live long enough, at any rate, to see the Australian people supplied with their woollen clothing necessities from Australian-grown and Australian -manufactured wool.
– What the people cannot understand is that they should be paying 300 per cent, more for their woollen goods, and yet we cannot get rid of our wool.
– If the honorable senator and other interjectors will permit me to continue they will see that I shall have answered their interjections in the course of my statement. Stabilization is’ essential, and if we can only do something towards bringing that about, it will be our. bounden duty. Stabilization means confidence, both financial and industrial; it would help finance and assist kindred industries. If one does not know what prices are going to be, one is naturally unwilling to do anything. Stabilization should tend towards cheaper clothing, too, because a manufacturer will know that prices are going to be stable, and that he can go straight ahead. It will not be a case of his saying, “ I am not going to buy to-day at 8d., and make up this stuff, and then find next week that the other fellow has been able to buy at 6d., so that he will be able to undercut me with his goods.” Stabilization of prices should tend to the much lower cost of clothing.
– Is the period of six months, which has been mentioned by the Minister, sufficiently long?
– I do not think so. I am sorry that the period is not at least twelve months. I take it, however, that it is the intention of the Government to give the proposition a trial for six months, and then to see. how the scheme is going; whereupon, if advisable, let us hope it will be continued. The initial suggestion, namely, for a couple of months, was worse than useless.
The Minister for Repatriation (Senator E. D. Millen) has said that the Government did not think this proposition would cure the evil; but he wisely added that the scheme of Bawra was better than nothing. I would like honorable senators to study the suggestions which, so far, have been variously promulgated. They are recorded, bv the way, in the press to-day, and will be to-morrow; and some sections of the press, no doubt, will ‘‘hammer” Bawra for all they are worth. They are -
I would like to deal with these ideas in their order. The proposal to hold over would probably aggravate the position, because it would not get the wool into consumption. It would mean that the trade would be working with a very heavy weight over its head. We would know that that huge accumulation was only being temporarily held off the market, and that at some time it was bound to be dumped right on to us - which would have the effect of knocking the bottom, not only out of raw wool, but of the market for those who were holding manufactured goods on hand. As for the proposition that Australia should buy the British share of the Bawra wool, that has been recommended by an honorable member in another place. But we are sellers, and not buyers; and we want the money. If such a position were forced upon the Government, namely, that they should have to buy the wool, they would be bound to take into consideration the cost of storage and depreciation of value. Some people say the Bawra wool should be held over and the free wool sold.
– How much would we have to buy?
– We would have to buy back 850,000 bales of our own grown wool, and a “ jolly sight “ more, for that quantity represents “ only the stock there now.- I admit that wool does not very greatly depreciate in value, but it is apt to get a little weevil into it, on the outside, especially if it is scoured wool, held a long time. There would not be anything like the degree of depreciation such as when weevil attacks wheat. We have had only enough experience to know that there is no great depreciation if wool is held for three or four years; but, if we are to buy and to hold over indefinitely, I will not say that the wool would not deteriorate. At any rate, the cost of storage in England, where the stocks in question are at present, would be very heavy.
With regard to selling cheaply to European markets, the outcome of that would simply be that, with the cheap labour and cheap wool available, Europe would dump its cheaper goods on the markets all over the world, and would completely take away British trade in woollen goods.
– And what would be wrong with that, from the view-point of the consumer?
– Our own trade would go, with the British; and, in any case, we should look after the British manufacturers.
– If wool were given to Europe, England would not huy our wool, since Continental manufacturers would have taken away their market.
– Quite so. This proposal is absolutely the silliest of all. The proper thing to do is to sell the wool to Europe at a good price, and, taking security, to give long terms.
– It is scarcely a good price.
– What is not a good price?
– I refer to the figure of 8d. per lb.
– Some of the wool has already been sold, for example, to Austria and Poland, on the conditions I have indicated, including long terms. The Bawra proposal is to restrict offerigs to feed the demand as stocks can be taken. The arrangement is to sell three bales of wool in England, allocating the quantities fairly, so as not to spoil the London market or that in Australia, and to sell three bales in Australia. Further, for every six bales, two out of the three sold in London are to be Bawra, and one new wool ; whilst the three bales sold in Australia are to be all new wool. It will be seen that the new clip is getting quite a fair deal, in that four of the six bales sold are to be new wool. After all, it should not be forgotten that we are dealing also with the property of the British Government, and that they hav.e paid us well for it. We cannot expect to hold both ends of the stick. There is no sug(gestion of the Government to prohibit trade. Wool will be sold at open auction, and there is no proposal to fix market prices. The opponents of Bawra are largely those who- are influenced by jealousy, or are speculators.
The Victorian Buyers Association has been mentioned. This is a very fine and genuine body which has done much to build up the trade iu Australia. But the letter of its secretary, Mr. Ford, published in today’s press, is both biased and inaccurate, while the suggestion contained therein to buy up the wool is absurd. Mr. Ford says in his epistle that it is an excellent idea, if the money can be found And he goes on to say that the change of ownership would not restore confidence. Of course not! Then why suggest that the wool should be bought up? Still another absurd suggestion is to let 2,500 manufacturers each carry a stock of 1,000 bales. It would be a grand “spec” if we were to let the manufacturers have the wool at 3d. - their own price. Naturally, they would carry the stock without any ado. But if those manufacturers could get 1,000 bales each of old, cheap stock, as Mr. Ford suggests, what would happen to our new wool ? The manufacturers would not want it, for they would already have cheap stocks on hand. The accusations contained in the letter, to the effect that the growers are -not supporting the proposals of Bawra, are almost too absurd to warrant reply. Every organization, as Senator E. D. Millen has pointed out, has given its support, from the largest of the pastoralists’ associations to the smallest farmers’ organizations, and so do fifty-eight out of fifty-nine selling houses also lend their support. To publicly state in the press, therefore, that the Bawra scheme has not the support of the growers is not accurate.
– And that is only putting it mildly.
– It is- The scheme is not only supported by practically all the growers of wool, but bv allied industries,’ whose support was indicated by accredited representatives at, the meetings which considered the subject. However, a few people are against Bawra because they have personal dislikes. That factor has entered into tho matter, I am sorry to say, in a marked degree. There are people who have axes to grind. Some persons sold their wool before Christmas at wonderful prices, and now they have money with which to go into syndicates in order to buy other people’s wool at one-half of the price which they secured.
Another consideration has to do with the request of the Fellmongers and Woolscourers Association for exemption. I do not know whether the Government have considered this matter.. The fellmongers employ a great deal of labour in Australia, and particularly in Victoria. Exemption has been asked for, and I may add that there is something to be said for the contention advanced by the- association. At a meeting this morning resolutions were agreed to as set out in this statement: -
The financial factor governing the operations of the fellmongers and scourers is a fairly rapid turnover of their money.
The result of Bawra control would be as follows: - A fellmonger or scourer buying skins or wool in his ordinary volume and not being able to realize on his products, possibly for months, would only just be able to carry on as long as his available capital permitted.
There is a good deal in what the fellmongers and scourers put forward. I do not know whether the Government intend to permit any exemptions, but I would recommend that they should be very careful in dealing with the matter for fear that a serious blow be delivered to the fellmongering industry, which we all want to encourage, and which employs so much labour. The fellmongers could not just buy a certain line of skins, and treat them, and hold the ^resultant wool for six months or a year before^ realizing. They need to keep turning over their capital. However, if machinery can be introduced without upsetting the whole general scheme, I would be in favour of the requests being granted. ,
– The honorable senator should make a specific suggestion.
– That is not for me, because I consider the Bawra directorate very able. Nor have I time to go into the matter of what concrete suggestions the fellmongers and wool-scourers mav put forward.
It is not necessary to further labour the fact of .the support of all the organizations for the Bawra scheme, since telegrams and letters from all the accredited bodies in the wool trade have5 been pouring in to honorable senators. When I was in close touch with those associated with Bawra, the suggestion was to make the gross reserve price at least 9d. I do not think I am giving away any secrets when I tell honorable senators that a very large section of the delegates wanted a much higher price than 9d. fixed. They wanted a price that would pay for the cost of production, namely, lid., but after a great many sittings, much evidence, and considerable argument, it was decided not to embarrass the Government by allowing a charge to be made against them that they were trying to bolster up one particular industry. And so it’ was agreed to take 9d., which is 2d. less than the cost of production, and which, after all, is only 8d. on the farm. The average for the five years preceding the war was 9½d. to 9¾d., and during the war period the wool-growers got 15-^d., plus profits.
– Would not a higher price than 9d. have a tendency to restrict sales ?
-No. I am going to deal with that aspect of the question. Unfortunately, cheap wool does not necessarily result in cheap clothing.
– The honorable senator must not overlook the interrelation of price with the quantity placed on the market.
– I do not. The position wants to be handled very carefully, and, therefore, Government assistance is required. Cheap wool, as I have already said, does not necessarily mean cheap clothing. The price paid for clothing to-day in Australia is nothing but a public scandal, because at 9d. per lb., the total cost of 7 lbs. of greasy wool required for a suit of clothes is only 5s. 3d. This is the amount which the producer gets at a flat rate of 9d. for his year’s work, and upon which he is expected to meet his interest charges, high arbitration awards, and pay freight and charges, and buy woolpacks at exorbitant prices because the mill-owners of India have for some years been making a profit of 177 per cent. Is it not a scandal that the producer of the wool for a suit of clothes gets only 5s. 3d., while the purchaser pays from -£8 8s. to £10 10s. ? The difference does not all go in wages. The manufacturer has been getting a big .cut, the wholesale houses have been making immense profits, and now that they have over-imported, and are holding big stocks of dear clothing, they do not want to cut down the price. I think, however, that public opinion will force down the cost of living, and it should be our duty to tell the people the truth. i
– The honorable senator’s calculations ought to be published broadcast in Australia.
– I want them to be. That is why I am labouring the point. The high cost of living is, I think, largely the cause of all this industrial unrest in Australia, and at the present time the high cost of living is not warranted.
I- have taken the trouble to get out a list of the raw commodities produced in Australia, with the exception of wheat, which, being the subject of a definite contract between the Wheat Board and the State Governments concerned, has been eliminated. ‘ The Governments having entered into a contract, I am not going to advocate its abrogation, although a great deal of pressure has been brought upon all honorable senators to do so. The people of Australia must not forget that throughout the war period the Australian farmers were only getting about one-half the world’s parity for their wheat. Taking all the other commodities, I find that the average fall ir twelve months is 60 per cent., and yet according to the Statistician’s figures the cost of living in Austraia, m compared with twelve months ago, is 13 per cent, higher^ instead of being lower. The wholesale houses and the larger shops are robbing the people. These are strong words, yet I believe in saying what I think. I am not frightened of anybody. Cotton, which is wool’s greatest competitor, was 4½d. per lb. prior to the war. During the war it rose to 26d., and it is now from 5d. to 6d. Though it is now a little above pre-war rates, it is a long way better off than wool. The price of food grains, except wheat, has fallen during the past year 55- per cent., and meat from 45 to 50 per cent., but still the people are not getting meat at a reasonable price.
– Prices’ have not fallen in the retail shops.
– No ; and that is what I am aiming at. I say that we are not getting a fair deal. Meat is down to the producer 50 per cent., but is up to the consumer.
– The excuse is that the butchers cannot find a market for the by-products.
– That is so, and in fairness to them the fact must be stated. We know that the price of all byproducts, hides, skins, tallow has fallen enormously, but still the retail prices charged, for meat are out of all reason. The whole sale prices for meat are frightfully low. If any man cares to go to the Melbourne meat market, he can get cheap meat if he buys sheep wholesale. I am glad to say that the men in our store are doing this, with the result that they are getting lamb for 3½d. per lb. In fairness to butchers and shopkeepers generally, it must be remembered that the cost of distribution is very high, and it is doubtful if they are getting a fair day’s work for a fair day’s pay, because of the pernicious “ slowdown” propaganda which is being continually preached in this country. Sheep skins are down 70 to 85 per cent. ; hides are down 53 per cenT. and rabbit skins 78 per cent., and yet to-day we are practically paying more for boots and leather goods than we were twelve months ago. The present high, cost of living is due, to some extent, to big manufacturing profits, and in some cases to excessive pro section, with the result that many of the wholesale houses have been profiteering to an enormous extent, but now that they are loaded with high-priced goods they are endeavouring to retain war prices, although the market has collapsed.
– What has all this to do with the wool position?
– I want to show that the fixation of wool prices will to a certain extent stabilize the industry, and that stabilization of the wool industry will lead to stabilization of land prices and other primary industries. We do not want to drive the people from the land to the cities. On the contrary, we want, if possible, to persuade them to go upon the land.
– According to the honorable senator, tho policy he is supporting will give us cheaper imported commodities.
– I have said nothing of the kind. The high cost of living is largely duo to thA misguided action of Labour leaders, and this slowdown propaganda.
– Do you not admit that the output of a factory is as great to-day as ever it was?
Senator - GUTHRIE. - I do not say that our workers are all bad. I am not going to make any disparaging remarks about labour generally - not by any means The Australian, labouring man, with whom I have been associated, is as good as good as any of his class to be found in any part of the world, but, at the same time, a certain section is yielding to this slow-down propaganda. Can we. not find plenty of evidence of this in the frequency with which strikes occur? Does not the honorable senator admit that there has been a surfeit of strikes lately? And does he not realize that one effect of a strike is to put up the cost of living ?
– The t honorable senator said, I think,” that high prices caused this industrial discontent.
– So it does.
– And is not this proposal a scheme to slow-down in regard to wool ?
– No. I am arguing in favour of the stabilization of values, of markets and of profits. Unless we hive some such stabilization we shall not know where we stand. The position is very serious. Indeed, it is desperate, and, therefore, desperate measures, if honorable senators like to call ‘ them such, are necessary to meet it. At a later stage I intend to move an amendment, if the Government insists on a minimum reserve of 8d., that the price be 9d.
– If the honorable senator desires to move an amendment to the motion, he must do so before he resumes his seat, otherwise he will lose his opportunity.
– Thank you, Mr. President, I shall do so.
– Can the honorable senator explain how the agreement may be enforced? If those who, are standing out want to sell 100 bales at 5d., what is to prevent them selling at 9d., and getting a rebate of £500?
– The man who buys the wool will not be allowed to sell it except under the conditions imposed. [Extension of time granted.]
– Something must be done. I should like to see one year’s’ trial given to the scheme, but I would compromise on that, altho.’gh I do not think it is possible to do a great deal of good in six months. Still, I am hoping that it will be carried on. Honorable senators may call this scheme what they like. They may call it Protection, if they prefer that word, because in this country we have Protection for everybody except the primary producers.
– Does not Protection protect them?
– No. The primary producer pays through the nose for everything he uses, whereas, until recently, at all events, he had to take world’s parity for everything he had to sell. During the war, as honorable senators are aware, Australian wheat producers sold their wheat at about one-half of the world’s parity. As 9d. per lb. gross in Australia is equivalent to an average price of 8d. on the farm, I move -
That the statement be amended by providing that the average gross price in Australia be 9d. per lb., instead of 8d. per lb.
Senator FAIRBAIRN (Victoria) f4.37]. - I second the amendment. It is not my intention to weary the Senate at great length, because this important question has already been ably discussed by Senator Guthrie and others. I desire, however, to state a few facts which I consider the honorable senator has overlooked, and to explain a few matters which I do not think honorable senators thoroughly understand. There is only one phase of the question on which I entirely disagree with Senator Guthrie, and that is in connexion with the manner in which the banks have been blamed for selling wool in London. We should be fair even to the banks, and I am sure that Senator Guthrie is also anxious to be just to our large financial institutions. We have to put ourselves in the position of the banking institutions and consider what we would do under similar circumstances. The banks do not own the wool because the producers place it in their hands and ask them to sell it on their behalf. This position has developed very suddenly, and the banks have acted as they have always done by shipping the wool to London. At the time there was no thought of any restrictions being placed on the sale of the wool, and the growers’ product was landed in London. The real owner of the wool is the1 consignor. If the banks did what was required and withdrew it from sale, the owners could take action for damages against the banks. It was impossible for the banks to fall in with the suggestion with the concurrence of the consignor. The banks have an approved system,- and it is generally believed that they are anxious to help this scheme as much as possible. The institutions would be willing to give the names of the consignors, who could instruct their banks to hold their wool if necessary. The onus would be on the grower to instruct the banks, and I am sure we all desire to see the responsibility rest in the proper place. Senator Guthrie said there are 80,000 wool growers iri Australia, but I have always been under the impression that there were 145,000 wool producers. If there are only 80,000, as the honorable senator suggests, that is a very important section of our community, and one which employs a large number of people. From that point of view alone it must be obvious to every one that it is our duty to protect such a great industry which, owing to the present turmoil, is likely to be ruined.
– The number must have increased in recent years, because many farmers are now growing wool.
– Chaos prevails not only in the wool industry, because the metal industry is also in a parlous condition, as such undertakings as the Mr Lyell Company, Mr Morgan, the Wallaroo and Moonta Mining and Smelting Company, the Broken Hill companies, and the Kalgoorlie mining companies have suspended operations, or are about to do so. The hide and tallow markets are also in a very unsettled state.
– Gold is about the only commodity that can be exported, and that can only be done through a certain organization.
– There is always a good price obtainable for gold. It does not pay to export rabbits, and the butter market is threatened with a glut owing to the possibility of large Danish importations. The sugar producers and the wheat growers are about the only ones who are having a fairly good time.
– It is about time the sugar growers received something.
– I was associated with sugar production for a time, and was glad to get out of it. It is generally admitted that the wheat growing industry has been the backbone of the country; but we see the position in which New Zealand is placed, where they have very little wheat, and have to rely on their trade in the commodities I have mentioned. The cost of living in New Zealand has fallen con.siderably, as prime cuts of beef can be purchased there for 5d. per lb., while it is about double the price in the Commonwealth, although the producer here is receiving very little more than the producer in New Zealand. The price of wheat in America was recently quoted at 4s. 6d. per bushel.
Senator -Crawford. - It has gone up since then.
– I am glad it has.
I desire to emphasize the point made by the Minister for Repatriation (Senator E. D. Millen) and Senator Guthrie that we are in a dangerous position; but I am not one of those who, even in bad times, cannot see a ray of daylight. I believe we are reaching the bottom, and that before long, if we can make satisfactory terms with Germany, and the coal strike in Great Britain can be .settled, the position will be much brighter. The present situation has arisen largely owing to the fact that the insolvent nations of Europe are unable to buy our wool; but that has already been dealt with by previous speakers. Another important “factor which has not been mentioned is the strike of consumers, which has, to some extent, affected the position. Practically every friend I have spoken to says, “ I am not going to purchase clothes until prices come down to pre-war rates.” I am beginning to know honorable senators by their clothes. I know of only one friend of mine who has purchased a .suit of clothes .recently, and the price was £18 cash, or £18 18s. booked. Senator Guthrie mentioned that the value of wool in a suit of clothes is about 5s. 3d., which is made up by charging for 7 lbs. of wool at 9d. per lb. If we do not adopt this system the trouble will be that the price will either have to be decreased or the demand increased. There, is only 5s. 3d. worth of wool in a suit of clothes or a blanket, and if we deduct the value of the wool in those articles, probably the manufacturers would not reduce the price. I have always been a great “ supply and demand” man, and if I could be assured that the position would improve by reducing the price, and thus increasing the demand, I would be prepared to face the situation; but we cannot be assured of that.
– How can it be done by increasing the price?
– We are not increasing it, as 9d. per lb. is equal to a reduction of” 10 per cent. When we are asked £18 for a suit of clothes, and realize that the wool-grower is only getting 5s. 3d. out of it, it must be admitted that the value of the wool is a negligible quantity, because if the wool were supplied free the same suit would be sold at £17 15s. A reduction in price would not be the means of increasing the consumption, and the position confronting us has forced me into supporting the scheme, although I do not like it. The wool-growers have been accused of “crawling” to the Government; but we are only keeping the “ scabs “ of the wool industry from wrecking it. The wool-growers can only be compared with the workers who have sought a minimum wage, and we are only asking the Government to sustain a minimum price for wool. When workers approach the Government or the Courts with a demand for a minimum wage, they are not accused of “ crawling.”
– I have heard the workers denounced from many platforms for demanding a minimum wage.
– But they were not accused of “ crawling.”
– They have been denounced by people who are now asking for a minimum price for their ‘‘wool.
– We are only asking for protection similar to that given to other sections of the community.
– How can the wool-grower pay a minimum wage if he is not protected by a fixed price?
– Exactly. The wool-growers are not only up against organized labour, but have also to contend with the operations of the Shipping Combine, as the freight on wool ‘is now 1?d. per lb., instead of fd., as it used to be. There are various other organizations operating against the wool producers, and it is only reasonable to suggest that they should have some assistance from the Government. It is unfair to say that we are “ crawling.”
– I think the charge is that the Government are “ touting “ for the wool-growers.
– I do not see why they should not, when we consider that they own practically one-half of the wool produced in Australia. They have taken a tremendous “cut” out of it by their income tax and a further big cut out of it by their land tax. Therefore, they are practically half owners of the wool proposition to-day. It has also been said that the wool-growers of Australia had a magnificent time during the war. As a matter of fact, they had nothing like the time which - was enjoyed by the wheat-growers ‘of Canada and the United States of America, and they have been continually complimented by the British authorities upon the way in which they came forward and accepted the flat rate which was offered, and which ultimately turned out to be a very low price indeed. I admit that if the cost of production had remained where it was that price would have been a very fine one indeed, and the wool-growers would have made a lot of money out of it. But the cost of production has since doubled. Where it used to cost 2s. 6d. it now costs at least 5s. to land the same weight of wool at the seaboard. Then the wool-grower has to pay another 30s. per bale more than he was required to pay prior to the war. These increased charges have absorbed a good deal of the profit. But what happened to the profit after the grower had received it? The Government immediately came along with an increased income tax. A great deal of this profit went in that direction. Then this. Parliament enacted the War-time Profits Taxation Act, under which, during the first vear of its operation, the Government took 50 per cent, of that profit, and during the following year 75 per cent, of it. Last year the tax upon the profits produced from every enterprise in Australia in excess of those made before the war amounted to only £4,000,000. Assuming that one-half of this sum came from the wool -growers, it means that they made only £1,000,000 during that year above ‘the profits which they made in pre-war years.
– But the excess taxation of which the honorable senator has spoken would not apply to the smaller growers ?
– I do not think that it would.
– Does the honorable senator say that the wool-growers made a profit of only £1,000.000 out of a total production of £47,000,000?
– I am combating the assertion that during the war the wool-growers of Australia had a magnificent time, because they received a flat rate of ls. 31/2d. per lb. for their product, lt must be remembered, however, that their cost of production has doubled, that the income- tax has taken a big slice of their profits, that the War-time Profits Taxation Act absorbed 50 per cent, of their excess profits during the first year of its operation, and 75 per cent, of them during the following years. As that tax, over the whole of Australia, produced only £4,000,000 last year, it is obvious, that all that the wool-growers made was about £1,000,000 in excess of the profit which they made before the war. That is not an excessive amount. Senator Foster has asked how the wool-growers in Australia can be compelled to sell at the fixed price 1 As a rule every wool-grower, when he wishes to sell, employe a broker. There is only one broker standing out of this Pool, and he is a man in Adelaide. Immediately a wool-grower Approaches his broker, the latter will say to him, “ I cannot sell your wool unless you consent to it being appraised at the limit which has been fixed.” Of course, any grower Jiving near the particular broker in Adelaide of whom I have spoken may escape. But when the buyer attempts to ship his wool from the seaboard he will immediatelv find himself up against this proposition that he will not be allowed to ship it unless he gives an undertaking that it has not been sold, and will not be sold, at less than the fixed price.
– Suppose that a woolgrower is badly in need of money, and that he offers to sell it to a local manufacturer for 6d. a lb., how can Bawra prevent him from doing so ?
– That is merely a detail, and I do not think the Government have got, so far as that yet. The whole consumption of wool in Australia amounts to only 5 per cent.’ of our production. If, as Senator Foster suggests, a man is pushed for money, and a manufacturer offers him 6d. per lb. for his wool, I do not think that Bawra ought to interfere.
– We could exempt him.
– The whole transaction would be complete here. What we wish to do is to stabilize the overseas market.
– How can Bawra compel a man overseas to pay the fixed price if it is above the world’s parity?
– Ninepence per lb. is a reduction of 10 per cent, upon the last sale price of wool. When the buyers see that this is a stabilized price, I think they will bid against each other. Thus, the market will become stabilized. The danger is that the Argentine may undersell us. But, as Senator Guthrie has pointed out, the wool from that country is a low-class wool. If one puts his hand into a bale of it he will feel that it is of a harsh quality.
– If a person in England refuses to buy our wool, will not the wool be accumulating in Australia ?
– He must buy sooner or later.
– But will not the wool be accumulating here?
– The wool will be shipped immediately the grower authorizes his agent not to sell at below the fixed price.
– But suppose that the man overseas will not buy at that price ?
– That is the cause of all our trouble just now. The difficulty is entirely due to the consumers’ strike. When the wholesalers and retailers realize the position - and it will not be very . long before they will realize it,, because cheap goods are coming from other parts of the world - they will be obliged to reduce prices.
– We shall have to put up the duties.
– I will not do that until the public has been properly served. The competition of the Argentine is, no doubt, a serious matter to us. But we have very skilful men upon the other side of the world who are closely watching events. They will immediately inform us if there is a danger of Argentine competition. I do not think that the Argentine wool will compete with our lower grade wool. All our wool will be sold at from l0d. per lb. down to 2d. per lb. Should the Argentine threaten to cut us clean out of the market, Bawra will take steps to prevent it. Its directors are common-sense men, and we can trust them to do that. Of course, there are drawbacks to this great question. The scheme which has been put forward seems to me to offer the most likely method of solving the present difficulty.
Senator Guthrie has referred to the fellmongering industry, and I ask him to make a suggestion to the Government. I do not think that the Ministry have really considered that particular matter yet.
– It may be necessary to exempt fellmongers.
– As long as they purchase their .greasy wool or sheepskins at a price that is not below the fixed rate, they must be allowed to sell their products upon the open markets as quickly as possible. If they bought greasy wool at the fixed rate, and fellmongered it, I do not think they could seriously hamper the maintenance of the fixed price. Anyway, it is an industry which we must carefully guard. I would like the woolbuyers to be consulted in this matter.
– I intended to refer to them. I am very sorry that the National Council did not consult the wool-buyers.
– The latter certainly rendered splendid service dur- ing the war. They were largely responsible for fixing the values of the wool which was sold during the war, and they did meritorious work. They are commonsense men. They want to buy wool at a reasonably low price,, but they do’ not wish to kill the industry. Consequently, I would like them to bc consulted. They are men of tremendous ability, the equal, I think, of any business men in the world. They have had to undergo a very long training, and it would be a compliment to them to consult them. They are only anxious to maintain the wool industry, which at present is in a parlous condition. I hope that Bawra will consult them with a view of accomplishing what we all desire, namely, the stabilizing of the industry.
Some honorable senators have said that the fixing of the price by regulation will constitute a dangerous precedent. I am inclined to agree with them. They have suggested that the matter should be dealt with by Act of Parliament. Upon the other hand, we have to recollect that every day is of consequence. Time is the essence of the contract, as our legal friends would say. We wish to stabilize the market as soon as possible. That is my only objection to dealing with the matter by means of a separate Bill. Of course, if the Minister could assure us that such a measure would pass through this Parliament within the course of a few days, the position would be different.
– The Government can hardly interpose such a Bill while the Tariff is under consideration.
– Suppose that, three months hence, all parties agreed that a change was desirable, it would then be necessary to put through another Bill.
– There are, of course, objections to the procedure which has been suggested. I do not think that any Minister would ever issue- a regulation which is designed to regulate exports without consulting Parliament. This discussion is almost tantamount to a direction to the Government to issue such a regulation under the Customs Act. Consequently, I do not see much danger in the procedure. Time, I repeat, is the essence of the contract; and we wish to get our wool sold as quickly as possible, so that Australia may be. prosperous once more.
I have now dealt with most of the points with which Senator Guthrie omitted to deal. I thank honorable senators for the attention which they have given me. This is a most important matter, and I hope that Bawra will offer a method of dealing with it. The position is most complicated. The products of the primary industries are now saleable only nt prices under the cost of product:on, whilst everything which the producers require - Labour, fencing wire, clothes, and everything else - are at a tremendous price. We cannot legitimately ask the working man to consent to a reduction of his wages, whilst the present prices of the goods lie requires are kept up. It is of vital importance that’ the cost of living shall be reduced as soon as possible. My own idea is that in three months’. time we shall witness a tremendous slump in prices generally. If we ask the workers to take lower wages, we must have a reduction in the co3t of living. That is the first thing necessary to save the wool industry, and the metals industry also. I hops that the suggestion which has beer made will be acted upon by the Governmentt. They might take into consideration tha advisability of increasing the proposed price from 8d. to 9d. per lb. Even at 9d. per lb., the price will be well under ths cost of production.
– The fixing of the minimum at 8d. per lb. will not prevent the grower receiving 9d., 10d., or more per lb.
– Still we want a minimum of 9d.
– It is a matter for discussion. The price of 9d. per lb. represents a further reduction of 10 per cent, on the prices ruling at the last wool sales. ‘ I hope the Government will take that into consideration. I have great respect for the men who have been dealing with this’ matter, and I think they have suggested a price which is as low as we can possibly go at thy present time.
– Senator Guthrie has handed to me his amendment in the amended form in which he desires it to be submitted. As amended the amendment is more in consonance with what is required by the Standing Orders, and with what I understand lie personally desires. The honorable senator proposes to add the following words to the motion: - “ but the Senate is of opinion that the minimum price at which Australian wool may be sold should average 9d. per lb. gross.”
– No ono will regret a discussion on the wool question. My only complaint is that, through the Leader of the Senate (Senator E. D. Millen) the Government have this afternoon told us what they propose to do, before honorable senators have had an opportunity of expressing their opinions, and having them considered by the Government. I do not approach this matter in a panicky frame of mind. Things are bad all over the world, and the wool position in Australia is in this respect no worse than the metal position, or the position with respect to the world’s commodities which has been reached everywhere as a result of the deflation of prices which has so rapidly taken place.
– The difficulty is that we cannot shut down upon it. The evil grows in the night.
– No one is more sympathetic with the troubles of the woolgrower and with tho troubles generally of the man on the land than I am, but I regret that tho Government bas made the decision it has made, because in my opinion there was a better alternative. As I understand it, the decision of the Government is subject to its ratification by Parliament, that a prohibition under the Customs Act shall be enforced by regulation, so that no wool can or shall be exported from Australia, or sold to any part of the world, at a lower price than a flat rate of Sd. per lb. In the first place, I most strongly object to the Customs Act being used in this way. I do not think it was ever intended that it should be so used.
– Oh, yes, it was.
– By direction of Parliament.
– What about the “new Protection” proposals?
– The Customs Act gives power to the Minister for Customs to prohibit the export of any commodity that is harmful to Australia. I do not think that by any stretch of the imagination it can be argued that the export of wool is harmful to Australia.
– At too low a price it would be.
– The honorable senator must concede that the people who have wool to sell are Australians.
– I point out that this introduces an extremely dangerous feature into our legislation. Most of us are sick and tired of goverment by regulation. We are tired, also, of the various experiments we have had in the direction of. State Socialism, and yet we are now asked, as the decision of the Government practically applies to the whole of the wool industry, to place it again under bureaucratic administration, and to go back to the times of war when so many sections of the community who dealt in wool, and made their living out of the pastoral industry were so dissatisfied. That is what is proposed by the Government.
Let us examine what the real Bawra position is. About twelve months ago, when it was seen that the wool control must end on the 30th of last June, and that there was a carry-over on that date of wool jointly owned by the British Government and the Australian woolgrowers to the extent of about 2,000,000 bales the Prime Minister (Mr. Hughes) suggested to the Central Wool Committee that this carry-over should be locked up for an indefinite period, and the new clip allowed to go into pre-war channels of trade, and be sold under world’s conditions without restriction.
– We could not do that. The British Government would not allow it.
– That was’ the suggestion made by the Prime Minister twelve months ago in regard to the accumulation of wool.
– That was with respect to Australia’s share ; but the British Government owned 850,000 bales, and they should have some say in the matter.
– I am perfectly well aware that the British Government had a share in the accumulated wool. * I wish to make my points one after another. I have stated the suggestion made by the Prime Minister, and i*> was turned down by the Central Wool Committee, now the directors of Bawra.
– No. Only two out of nine of the directors of Bawra were, members of the Central Wool Committee.
– The chairman of the Central Wool Committee was Sir John Higgins, and the same gentleman is chairman of Bawra. The Prime Minister’s suggestion was turned down by the wool advisers of the pastoralists of Australia; but if it had been adopted by those wool quidnuncs there would have been 2,000.000 bales of wool in London and Australia that would practically have cost us nothing, because they had been paid for out of the surplus profits gathered from wool that had been sold.
– The honorable senator will excuse me. Only half of the 2,000,000 bales belongs to Australia, the other half belongs to the Imperial Government.
– I am quite aware that the 2,000,000 bales were jointly owned by the Australian wool-growers and the British Government. I have already said so. As .they were jointly owned, 1,000,000 bales only would belong to Australian wool-growers, and, roughly, 1,000,000 bales would belong to the British Government. The suggestion made by the Prime Minister was turned down, and, in conjunction with the representatives of the Munitions Department, through the Director-General of Munitions, Sir Arthur Goldfinch, and the Wool Committee here, the Bawra arrangement came into being. It provided for salaries, to Sir John Higgins and other directors appointed to control the marketing of our wool, amounting to the equivalent of £35,000 a year. The scheme that was fixed up by Sir John Higgins and his associates was to so control the wool industry of Australia as to limit the offerings of the new clip in order to sell pro raid quantities of Bawra- wool. That has been mentioned by Senator Guthrie. I have pointed out that the scheme suggested by the Prime Minister was turned down, and that representatives of the pastoralists and the Central Wool Committee created the Bawra scheme, and a week or two ago Sir John Higgins was reported throughout the press of Australia as having discovered that the Bawra scheme to stabilize the market was in peril of utter collapse. That has been admitted by Senator E. D. Millen in the statement he made_ to-day, and it has been confirmed by Senators Guthrie’ and Fairbairn.
The position to-day is that the Bawra scheme, as created by the wool advisors of the pastoralists, has broken down, and is in a state of utter collapse, without any responsibility on the part of the Government or Parliament of Australia.
– Does the honorable senator not desire to help it ?
– I am coming to that point. They now come to the Government and Parliament for help. That, I think, is the position.
– That has to be acknowledged.
– I am glad to ‘ have the admission from Senator Guthrie that that position has to be acknowledged. I say that this Parliament has a right to give what help it can, not to the wool industry as the only industry in Australia, but as the most important of the industries of Australia.
Senator Fairbairn__ The Government own half of it.
– Just as we shall have to come to the help of the manufacturers when the Tariff is before us.
– It has to be acknowledged that the present position, and all that has led to if,- must be the responsibility only of Sir John Higgins and his associates. I want to make that, quite clear before passing on to what I think to be the remedy. Sir John Higgins seeks to throw the responsibility on to the banks, but Senator Fairbairn has adequately replied to that. The Prime Minister’s original suggestionwas to hold Bawra wool indefinitely, and sell it on the Continent of Europe for internal consumption on long terms, and then set the whole of the rest of the world’s wool trade absolutely free. I submit that, if that scheme had been accepted, the present very acute position could not have arisen. The acquiescence of the British Government, I admit, would have been necessary for the scheme.
– It could not have been obtained.
– Had the Australian interests been in favour of such a course, the accomplishment of that scheme would not have been difficult if it had not met with bitter opposition from this end.
Let us see what has been going on in connexion with the administration of Bawra, which has led to the tragic state of affairs with which the Parliament is now faced. Senator Fairbairn stated that the Victorian Wool-buyers Association consisted of men of tremendous ability. Senator Guthrie, remarked that the association comprised men who had shown their patriotism throughout the war, and had not exhibited selfish interests, but had tried to do what was best for the wool industry in Australia.
– I have nothing but good to say of them.
– I am glad to have that admission, as I will now read what this combination of excellent gentlemen associated with the wool trade in Victoria have said in connexion with the operations of Bawra during the past six months.
– They may be very excellent men, but their sympathies and those of the growers are not identical. They want cheap wool.
– I have endeavoured to make plain the opinions of Senators Fairbairn. and Guthrie in regard to this organization. I will proceed now to read what these gentlemen say of Bawra, and will criticise them afterwards : 1- - In July last, when local manufacturers were prepared to purchase large quantities of surplus wool, prices were fixed so high that only small quantities were purchased.
I repeat that this association has made a specific statement that wool was passed in by Bawra, or its representatives-
– Not by Bawra at all.
– Well, by the Central Wool Committee, or those controlling the wool interest in Australia. It was passed in at 18d. to 20d., while similar wool was sold in Melbourne last month at 3£d. to 5d.
– Probably the owner instructed his broker to pass the holdings in at the price. Many owners did give such instructions, and they are sorry for it now. I had owners instruct me to pass in at 40d.
– The association proceeds : -
– The growers were greedy. Some of them made me withdraw lots at the figure I have just indicated.
– And they fell in.
– Yes; I have no sympathy for them. But the honorable senator is accusing Bawra of having done this, which is not correct.
– The Victorian Wool-Buyers Association further asserted : -
– That was a grave mistake on the part of the National Wool Council. That body fixed no sales for January.
– That was Bawra.
– It had nothing whatever to do with Bawra.
– At any rate, someone connected with the advising of the growers on wool matters is making grave errors of judgment. This association further says -
Owing to the anticipated American Tariff, specially large orders at prices ranging from 20d. to 40d. were in the hands of Victorian buyers during that month. The same wool today would be worth approximately l0d. to 20d.
This association, which has been so lauded by Senator Guthrie and Senator Fairbairn, proceeds further to say in a circular letter -
The buyers do not wish to take up an antagonistic position to any proposed scheme, but they feel that their views should at least be given due weight. They fully agree that, as the quantity of Bawra wool is, rightly or wrongly, so huge, its disposal must be a matter of special arrangement As the individual growers have been paid the full appraised value of this wool, and, in addition, have received small bonuses, the buyers think that, instead of forcing the sale of Bawra wool, together with the present clip, it should be held over fora definite period of, say, two years, to enable the world’s markets and woollen manufacturers to settle down, when every bale could be absorbed.
That practically gets the Victorian Wool Buyers Association - these very estimable gentlemen - into line with the Prime Minister’s proposal, made twelve months ago.
– They said then that he knew nothing about it.
– They did ; but it seems to me that he knew more about it than all the wool quidnuncs put together.
– Was Sir John Higgins one of these?
– Yes. This association goes on, again -
We regret that Sir John Higgins sees fit to use his control over the Bawra wool as a “ pistol “ to the heads of growers and others interested in wool to force them to adopt his “ scheme.” It is assumed from his remarks that if power is not given to fix reserves, he threatens to throw Bawra wool upon the market, thereby causing a debacle. Probably he forgets that the position he now holds is one of trust, and he should not use it to menace any interested section of the trade.
The wool position is one that deserves our most serious and most sympathetic consideration. Statistics seem to show that Australia and. New Zealand have only about 20 per cent, of the world’s sheep.
– But 25 per cent, of the wool, and it is wool we are dealing with, not sheep.
– I accept that statement. I believe, with my honorable friend, who touched upon the point, that the wool to-day is growing twice as fast as it is being sold, and probably faster than it is being used. I am inclined to think that this wool matter cannot be finalized until the Prime Minister gets to London.
– We do not want that. Parliament should deal with it.
– As far as I can estimate, the proposal of the Government is unsound, is temporary, and cannot permanently stabilize the position. The only proposal that can do that, in view of the statistics, is to take the Bawra wool right off the market for a. specific time. Senator Guthrie stated that within the next six or nine months there will be 6,000,000 balesincluding Bawra wool - of Australian and New Zealand wool off the shears. As far as I can ascertain, the world’s normal annual consumption of Australian and New Zealand wool is. approximately 2,500,000 bales. Consequently, 6,000,000 bales- would be considerably over two years’ supply, and on to the third year’s normal supply, of the world’s requirements of this wool. But, in addition, -we have the under-consumption that has been created by European conditions; and I do not think it can be safely estimated that more than 2,000,000 bales of Australian and New Zealand wool will be normally consumed by the world’s customers for that commodity during the next twelve months. So, if we attempt to sell Bawra wool bale for bale, or two for one, or One for three-
– But the suggestion is two of Bawra and four of new wool; which makes all the difference.
– If the proposal is to sell Bawra wool simultaneously, with the new clips which have come in and will come in, and if. six months ahead, the world will have a three-years’ supply - under present conditions - of Australian and New Zealand wool off the shears, then where are we? When is the position going to be righted? I submit that nothing but a catascropne, both in Australia and New Zealand, which would not permit the export of any wool at all for a year, would right the market under those conditions. If we have 6,000,000 bales of wool - a three-years’ supply, including the Bawra wool- surely the sensible thing would be to keep the Bawra holdings off the market, so that matters may have a chance to settle down to normal.
– With such a weight of wool hanging over their heads, are the buyers going to operate with any confidence ?
– In July or August the Australian wool-growers who are shareholders in the Bawra wool are due for the payment of about £5,000,000 as a further dividend. Whether that is on account of Bawra, or the new clip, I do not know.
– The Bawra wool.
– That makes my argument the -clearer. The wool-growers of* Australia are due for a dividend of £5,000,000, either in July or August, from Bawra wool. I believe that that 900,000 bales of wool-
– Does that £5,000,000 represent excess profits over and above the 15½d.?
– I believe it is so, and I thank my honorable friend for his suggestion, because it takes me one step further in my argument. The £5,000,000 which the Australian woolgrowers are due to receive in July or August represents excess profits over and above the flat rate of 15½d. I understand that 900,000 bales of the Bawra wool belong to the British Government, and the other $00,000 to the Australian wool-growers. Why cannot the 900,000 bales held by the British Government be bought by the Australian wool-growers? It could probably be bought for £4,000,000 or £5,000,000- the amount of the dividend - and then, if necessary–
– They will never get it at anything like that price.
– I think that, if this problem were tackled in the right way, they would get it at a much lower price than some honorable senators think. If they could buy that proportion of Bawra wool, they could do anything they liked with it.
– How do you know the British Government would sell at that price?.
– I do not know; but we are asked by the Government to make some concrete suggestions, and this is the first suggestion I have to make.
If the Australian wool-growers could ge$ this 900,000 bale3 for the £5,000,000 surplus profits coming to them, they could, as I have said, do anything they liked with the wool. They could sell it, or hold it off the market.
– The British Government would have to agree.
– They would; but I do not think Great Britain would do anything to throttle the Australian wool industry. Great Britain has already done very well out of the wool deal. She got all the wool she wanted for military requirements and for. her Allies at a flat rate of 15-Jd., and she will also get £5,000,090, I understand, as so far her share of the excess profits on this Bawra wool. Altogether out of the wool she would get from £15,000,000 to £17,000,000 on a turnover of about £150,000,000 if her interests were sold at my figure now.
– Will the Australian wool-growers also get £10,000,000 to £15,000,000 over and above the flat rate?
– Their profit will be the same as the profit of the British Government.
– But it has been distributed. ,
– No. The coming surplus profit which the Australian woolgrowers are to get out of this Bawra wool should enable them to do as I suggest.
The ‘second suggestion is that the Government should come to the rescue, and do practically the same thing by buying the British Government’s share of the Bawra wool, taking control of it, and locking it up.
– That is not the Government’s proposal.
– If the Prime Minister’s suggestion had been adopted twelve months ago, the market would have been sustained, and probably we would not have experienced a drop in values to the extent of from £25,000,000 to £50,000,000. The second, or either of the propositions, presumes that the Bawra wool will be locked up for a certain period, and that sales will be made on long terms to European countries for internal consumption.
– At what price?
– At a price to be determined when we know what the position really is. At present nobody but Bawra directors are in a- position to indicate the pounds, shillings and pence aspect of the problem.
I believe that the proposal submitted by the Government is unsound. It certainly follows the line of least resistance, but it will not and cannot solve the present difficulty so long as we have three years’ supply in sight. The law of supply and demand must operate. I feel, therefore, that the course I have suggested is far more practicable, and will be much more . beneficial in the long run.
– You can’t keep it out of sight by hiding it.
– But it will keep Bawra wool out of the way, and it will help if the world’s wool-buyers know that for at least twelve months or two years it will not be available through the ordinary trade channels.
– I understand the proposal is to feed the market as required.
– Of course, it is.
– I say, most deliberately, that it is economically and fundamentally unsound not to lock up portion of this 6,000,000 bales already in sight, in view of the fact that the consumption may be only 2,000,000 bales per year. This will have to be done sooner or later. It should have been clone twelve months ago. -Unless it is done now,, I feel that the Government will be only paltering with the position, and that, at the end of six months, the position may be worse than it is at present.
I have not very much more to say about this important matter. I am. sure that my remarks will not be construed as suggesting a lack of sympathy on my part with the Australian wool-growers. I have been trying to give some attention to this subject in order to help this country out of its difficulties, and I am sure that, though some of my honorable friends may not agree with me, they will concede that it is in the interests of the woolgrowers themselves that we should ventilate every avenue and every point of view. I urge the Government, if they are going to prohibit the export of wool in accordance with their proposal-
– Their proposal is not to prohibit export.
– It is to prohibit export except under certain conditions,, and I now urge the Government not to use the authority of the Customs Act - which, in my opinion, was never intended to apply to legislation of this sort - but to bring in an enabling Bill so as to create a precedent, which I believe the Senate wants to create.
I have tried to make it plain that the present wool position has arisen through no act of this Government or of this Parliament; that it has arisen wholly and solely through the breaking down of the Bawra scheme, which is a private arrangement, and is not controlled by the Government in any shape or form.
– Is it not more a question of the market breaking ?
– It is a breakdown of the proposals made by Bawra.
– But really the breakdown is due to the action of the people who control 10 per cent, of the wool.
– I want to make it clear that the arrangement is one for which neither theGovernment nor this Parliament are responsible.
– Nobody is blaming the Government.
– I say this because we have been blamed so many times for acts of omission and commission that I want to make it quite clear now that there is no blame attaching to the Government or to this Parliament for the present position.
I have said what I wished to say about this important matter. In conclusion, I want to stress the fact that the Australian wool-grower will only get £1 for every £2 worth of Bawra sold: This, I think, is a further argument in support of locking up the whole of the Bawra wool.
– But they have had the other £1.
– No. For once the Minister has missed the point. The Australian wool-growers will only get £1 for every £2 worth of wool sold from Bawra stocks.- The British- Government will get the other £1, and consequently if there is £2 worth of wool sold from Bawra, it must displace £2 worth of wool from our new clip, and the Australian wool-grower will only get 50 per cent, of the money obtained if we. sold all the Bawra wool, and offered no new clip. This is a very important matter. I am prepared to go a long way to help to stabilize the wool industry, but I cannot indorse a good many of the panicky observations that have been made. It must be remembered that the pre-war average of the total wool clip was in the neighbourhood of £25,000,000 per annum. The average of about £40,000,000 during the war period was due entirely to abnormal conditions, so we should look at this matter, not from the stand-point of £40,000,000, but from the stand-point of £25,000,000, plus the extra cost of production during the years of war.
– And that is very considerable.
– I want to say, with all the responsibility attaching to my position as a member of the -Senate, that I cannot support-any proposal to use the Customs Act to solve this difficulty. What proposals the Government have to make should take the form of a Bill, so that legislation may be properly laid before members of this Chamber. I would have preferred an opportunity of discussing this matter before, rather than after, the Government announce their decision.
– But if the Government bring down a Bill, by that very act they announce their decision.
– I have said what I had to say in all sincerity, and with the sole and only object pf trying to help the wool-growers to stabilize their industry.
– I have waited, during this debate, to express my views for the very good reason that I ‘do not pose as an expert on wool or on wool prices, and I must say that when the Minister (Senator E. D. Millen) was speaking. I felt like the character in Bret Harte’s Heathen Ghvn.ee. who said, “ Do I sleep? Do I dream- ?”
-. D. Millen. - The answer would be “ Yes.”
– And when Senator Guthrie continued on similar lines I felt quite sure that everything was topsy-turvy. Frequent reference has from time to time .been made to the action of “ red-raggers “ and the advocates of the “ go-slow “ policy, particularly from the
Government benches, and the Government are now advocating a similar policy. The Government do not intend legislating in this matter, but are adopting a short cut to do what they desire by regulation.
– That is not going slow.
– But it is allowing the people who have the wool to sell tq go slow.
– It is not going slow, but merely limiting the sales.
-We have heard a good deal of the pernicious system of “ go-slow” adopted by the workers.
– Not by all of them.
– I desire to say most emphatically that I am not’ in agreement with the go-slow principle adopted by some workers. I think I may say that 1 have worked hard all my life, and I ha.ve always been opposed to any such system. In this case, however, we are protecting the interests of those who have done handsomely for a number oi’ years, and who now wish to go slow. Is it not logical for a workman to say that if he * produces less more employment will be available to others? What are the Government proposing? In effect, they are saying that if they can stop the “blackleg” or the “ scab “ who will not agree to this scheme, and who will persist in selling his wool in the open market, they will be the means of allowing the producer to secure a higher price for his product.
– It is an endeavour to stop a hopeless slump. There is no suggestion of putting the price up.
– Why should there be any such suggestion, when we consider that during the last few years the wool-growers have reaped a handsome profit ?
– Hd less some such provision is made the wool-growing industry will be ruined.
– The honorable senator says that there is no suggestion of putting up the price, but he must remember that during the last few years the wool-growers have received a substantial return for their product. It may not be a question of increasing the price, but it is an endeavour to improve the wool position.
Let us consider the methods the Government are adopting, and see how they compare with the iron law of supply and demand. Let us see how they compare with the attitude of a workman who is regarded as a “scab” or a “ Hackleg.” The iron law of supply and demand would compel the wool-grower in ordinary circumstances to sell in the open market; but the suggestion now is that if the wool is held for a certain period, or if export is prohibited for six months, the conditions may improve.
– Some have sold the whole of their Bawra wool, and we are up against that. The proposition is to sell two bales of Bawra wool with every four bales of free wool.
– I quite see how the honorable senator thinks it will be a benefit to the producers, and following that line of thought he endeavours to prove why it is necessary for the Government to come in and force 10 per cent, of tha wool-growers, who will not agree to any restrictions, in order to prevent a slump. It is easy to realize that that 10 per cent, will have to be disciplined like the unionist, who has to be disciplined to prevent a slump in wages.
– What about 5 per cent. ?
– I do not care whether it is 3 or 5 per cent., that is the position as I understand it. I am at a loss to understand why the Government and certain honorable senators should be anxious to hurry out of the difficulty in this way instead of handling the proposition fully and thoroughly. This is a House of review, and, without any previous discussion, the Minister for Repatriation (.Senator E. D. Millen), after a short statement, announces the policy of the Government, and concludes with a motion that the paper be printed. If we agree to the motion moved .by the Minister, we shall be responsible for everything that is done by the Government in connexion with the handling of wool.
Let us go back a couple of years, and consider why there is at present such a huge surplus of wool. The Government - I hold them responsible - did all in their vower to prevent America getting wool.
– The Government did all they could to prevent America getting wool.
– We have sold a lot to America.
– The Government placed all sorts of restrictions in the way.
– America placed a prohibitive Tariff on importations of wool.
– Quite recently.
– Let us consider why America has imposed a prohibitive Tariff. Is it not because a heavyduty was imposed on American articles imported into this country?
– The honorable senator will have an opportunity of amending the Tariff when it is under consideration by the Senate.
– The Minister knows that I will have what is commonly known as “Buckley’s chance.” If the American Tariff is one of the causes, we can see how it has arisen.
– In “some cases the
Tariff imposes a duty of 22£d. per lb.
– Let us try to view the position from the American stand-point. During the war the Government prevented Australian wool from going to America, with the result that the American manufacturers were unable to use it; and the position now is that America has put on a Protectionist Tariff with the idea of encouraging the production of wool in America.
– That is not correct. America had large quantities of wool out of the Pool during the war, and when the issue ceased she refused to take 400,000 bales.
– Is not the Tariff, the cause of the. big stocks at present in America.?
– The Americans are endeavouring to build up their woollen industry.
– If I get an opportunity of. saying a word here and there, I may be able to explain what I mean. About twelve months ago we practically prohibited trade between Australia and America, and now, owing to their increased Tariff, we are prevented from profitably selling wool to that country. If we do not buy from America, America will not buy from us. We are faced with the fact that this Parliament and this Government have deliberately said that we must be a self-contained country, and produce everything we require ourselves, so there will be no necessity to trade with other nations..
Immediately the war ended, we were told by every opponent of Labour that we had to produce more, that the workmen would have to be employed for longer hours to achieve that end, and it now appears that the wool-grower has produced more, and we are in a tighter corner than ever.
– Have we not fewer sheep in Australia than. we had six years ago?
– The number is always fluctuating - that is only natural. In periods of drought the number rapidly decreases, but when the’ seasons improve it is not long before the flocks become reestablished; and it is useless submitting such an argument, because Australia is always confronted with the question of a large production.
– The consumption is too small.
– The production has not increased.
– I do not care what term honorable senators may use, because they will serve my purpose just the same. I am endeavouring to compare the wool producer with the representatives of the I.W.W., or the men who are supposed to believe in destruction.
– There is no analogy.
– 1 have heard this question discussed from the standpoint* of destroying the surplus.
– Not in this Chamber.
– I believe such a proposal was mentioned by Senator Pratten, who ‘said’ that the wool should be sold even if it were dumped into the sea. The I.W.W. thought is there.
– They would dump it without purchasing it.
– I do not want to infer that Senator Pratten advocated the destruction of our stocks, but he said that it. should be sold, even if it were dumped into the sea. I have heard the proposition of destroying the wool discussed as a way out of the difficulty.
– It was advocated by correspondence in the newspapers.
– Surely the honorable senator is not going to discuss letters in the press in this Chamber?
– No, but if there is anything in my argument, it shows that there is little difference between these people and those members of the community who would scratch the back of a pastoralist to strike a unionist. The unionist’s aim is to look after his own interests, and I am not blaming him for acting in such a manner.
The proposition, to my mind, appears to be that there is likelihood of a reduction in the price of wool, with the result that there will be a serious loss not only to. the pastoralists of Australia, but to the people generally, and if any one can submit a proposal to effectively meet the situation it will have my support. Senator Crawford said, by interjection, that the position had arisen in consequence of a reduced consumption. Why is it? When the pastoralists were having their turn during a very prosperous period, who was it that was going without wool ? The women who had to knit socks for their children, and who could not get it at a reasonable price.
– It was the middlemen who put ur> the price.
– I know all about the middleman, and have come to the conclusion that he is in the position where no one can touch him.-
– The Australian people have never been better dressed.
– They have been living extravagantly.
– The position has arisen owing to the high prices that have been ruling, and we are waiting, as Senator Fairbairn said, until wool drops in price. There are many who are refraining from purchasing clothing until prices are easier. The price of wool has been so high that millions of people ceased to use it, and, therefore, Senator Crawford is quite right in his suggestion that the situation has arisen owing to decreased consumption. That is the position we are in, and we have to consider the best way out of it. With Senator Pratten, I think that we are only postponing the difficulty. Apparently, it is true that those controlling the industry are unable to solve the problem, and, having failed to complete their work, are now asking for the assistance of the Government to force these obstinate “ black.leggers “ who insist on selling in the open market. The Senate, if it approves of what is proposed, will put the Government in the position of disciplining that 5 or 10 per cent, by the issue of a Customs regulation to prevent their wool being exported. “We will, in effect, be saying to this section of our woolproducers, “ Your wool shall not pass. You shall not get it to any other country, even though you may want to trade. We have a regulation to stop you. You would be interfering with the organization in this country,” The Government propose to interfere with a small section of the people of Australia who are engaged in wool-growing, and in their interests to say that a man who desires to trade in wool outside of Australia shall not be permitted to do so unless he agrees not to sell his wool at less than the fixed price. That is a most pernicious system to adopt.
I ask the Government to introduce a short Bill dealing with this matter, instead of attempting to deal with it by manipulating the regulations under our Customs Act. If the Minister will follow the course which I have suggested I shall not utter a single word in opposition to the measure. ‘ Of course, I shall be told that the reason underlying this proposal i3 the need for expedition,. But if the Minister will announce his intention to introduce to-morrow a Bill dealing with , the question, time will undoubtedly be saved. A majority of members in both branches of the Legislature will offer no opposition to it. It is much preferable to deal with the matter in that way rather than to allow the Government to manipulate a regulation which is now in existence, and which may be used illegally. If I understand this proposition aright it means that no wool shall be allowed to pass outside of Australia which has been or is to be sold for less than 8d. per lb. But suppose that I were able to sell wool at ls. per lb., what could prevent me doing so?
– There will be nothing to prevent that.
– And suppose that’ the purchaser of the wool afterwards handed me back 4d. per lb. upon it?
– That would be an illegal rebate.
– But the honorable senator must surely realize the possibilities in that direction.
– But there are possibilities of prosecution for conspiracy.
– I think that we ought “ to look at the way ,in which Trusts have operated in connexion with every concern which they have controlled, because, after all, it is a Trust which the Government propose to establish.
– The honorable senator is referring to Labour Trusts?
– Yes. Unfortunately, our Trusts are without capital, although they contain men with a good deal of intellect and a fine capacity for propaganda. I always find that the things which the Governnent have condemned in the past are all right when they suit their own purposes. If we are about to establish a Wool Trust to prevent the price of wool slumping, unless we do not make the position quite clear, the speculators whose business it is to make money out of it, will take a good many risks of conviction for conspiracy in the matter of fixing prices, just as the Trusts have done in every other case. Nobody can read the history of the United States of America without realizing that. The proposal to restrict the price of wool in Australia will prove abortive. I might sell wool to a man, and when once I got to Germany, from where could the interference come? i
– But an honest man could not do that.
– I know that the speculators are all honest. There used to be an axiom about being poor and honest, but I never heard one about being rich and honest. Will the Government really accomplish what they desire by the method which they now propose ? I have already given one instance of what appears to be a weakness in the proposal even to stop the sale of wool. But the Government will take very fine care that no wool leaves this country except Bawra wool.
– Free wool may go out just as well under this scheme.
– Yes ; but when the Minister for Trade and Customs has power to regulate export, it will not go out.
– It will po out just the same.
– If the Government are interfering to prevent the export of wool by the 5 per cent, of woolgrowers who will not fall in with their proposals they will take good care, when once they possess the requisite power, to prevent that section from exporting wool. The Minister of Repatriation says that free wool can go out just as well as can other wool. But when the Government are armed, with this power, I predict that it will not go out.
– Whether wool goes out in large or small quantities will not affect this scheme.
– We have not yet been told whether this power is to be administered bv the Minister for Trade and Customs or by the Bawra directors.
– That is so.
At a later stage I intend to ‘move a further amendment, which I hope the Government will accept. The amendment will be to add the words: -
That the Senate is of opinion that the Government should give effect to their proposals by legislation and not resort to regulations.
They can well afford to do that. Here we are confronted with a big question which, if dealt with in a separate Bill, could be disposed of in about one sitting of each House. No time need be wasted in discussing it. But honorable senators are entitled to know precisely what the Government expect of us and what they are going to accomplish, either by legislation or regulations. A general statement has been made upon this matter by the Minister for Repatriation. But three months or six months hence an honorable senator may say. “ We were not aware that the Ministry intended to do this or that.” The reply would probably be Why ! That went without saying when you agreed to our proposals.” If the Government will not bring forward a Bill dealing with this matter I shall simply oppose anything that they may do, because of the manner in which, they are doing it.
– But the honorable senator is opposed to the principle of the thing irrespective of whether it is1 done by Bill or regulation.
– Nothing of the kind, I have gone a long distance out of my way to show that the Government are right in touch with the extreme sections of the Labour party - the members of the Industrial Workers of the World and the Red-flaggers. But the Ministers may say there is something in the “ go slow “ policy.
– Something bad.
– There is something in it when it goes to the extent of preventing people from trading freely. Senator Guthrie cannot convince me that the chief object of the Government is to prevent wool speculators causing the market to slump, in order that they may obtain control of it for their own purposes. In the Labour movement, we have organized for years to prevent one section of the community from getting control of the labour market. We have no time for the men who come in. and who are willing to drag down the price of labour.
– No time for the 5 per cent. ?
– No. They are about the same everywhere. The Government would, therefore, be wise if they introduced a short Bill covering these proposals. So far as the Labour section in another place is concerned, there will be just as much division of opinion amongst its members as there is » here in regard to the procedure which the Government are adopting. If there be one thing more pernicious than another, it is Government interference through the Customs Houses with trade. At any rate if we permit Ministers to interfere with the export of wool by regulations, we shall be saying that we approve df them doing in an indirect way that which they should do in a direct way.
– The Minister for Trade and Customs prohibited the importation of sheep dip into Australia by means of .regulations.
– Yes, and he did so to benefit one firm as against another.
– To prevent the destruction of an industry which had been started in Australia to meet the’ conditions arising out of the war.
– He did so in the interests of certain industries as against other industries. I do not think that .the Minister for Trade and Customs should be given that power. I hold that Parliament is the place where these matters should be threshed out, and the law should determine what industries should be helped.
– This regulation has been threshed out both here and in the other Chamber.
– The Senate ought not to consent to the illegitimate use of such a regulation. We have no right to leave in the hands of a Minister the conditions upon which wool grown in Australia shall be sold, in any market in the world.
– They cannot be left in the hands of the Minister, because the proposal of the Government sets out what are those conditions. The Senate does not anticipate that there will be another- Government in power at an early date?
– No, considering the difficult problems with which Ministers are struggling.
– Does not the honorable senator think that shearers would support a proposal such as this?
– It is very difficult to say. One cannot speak for people with whom he is not acquainted. After all, the shearers are very much the same as is every other body of men. Out of every ten of them, probably five will be found upon one side and five upon the other.
The Minister has just interjected that if this motion is passed we shall have agreed to the proposal. We are being asked only to agree that a certain paper shall be printed, and we are given no chance to say whether we agree to the proposal or not. A suggestion might be made which every member of the Senate would recognise as an improvement upon the Government proposal, but in the way in which the matter has been submitted to us it could not be embodied in it. I realize that an attempt is being made by Senator Guthrie to -‘improve the price of wool; but if “we agree to what the honorable senator proposes, that will not bind the’ Government.
– Does the honorable senator think that that would be an improvement on the proposal?
– It would certainly improve the price. I am, with Senator E. D. Millen, a representative of probably the majority of the wool-growers of Australia, and I say that if it is as easy to fix the price at 9d. as at 8d. per 1b., we should fix it at 9d. per lb. If we are going to help the wool-growers, we should do the best we can for them, and not the second .best. Some one else, of course; might suggest that the price should be fixed at lOd. per lb. ; but the difficulty in dealing with such an amendment as Senator Guthrie proposes- is that we do not know if the Government will accept it. They might take the carrying of the amendment as an instruction to the Government, but it would represent merely the opinion of the Senate ; and what will happen if in another place there is an overwhelming majority in favour- of fixing the price at 7d. per lb..? I suppose that in that case the- Government would compromise and stick to the price they have, themselves suggested.
I am using these arguments- in order to show that we should not attempt to transact business in this manner. If the case is desperate and must be dealt with in some way at once, this- is certainly a quick way to deal with the matter. I have given notice of an amendment, and it is my intention to move it. The Government might deal with this matter as quickly by the introduction of a Bill as by the making of a regulation. If the Government dealt with the matter by the introduction of a Bill, Senator Pratten, or other honorable senators who have “ considered the question, might submit amendments which would be considered beneficial by even so great an authority on wool as Sir John Higgins. I think that there is something to be gained by adjourning this debate, and enabling the Government to deal with thi3 important matter in the only way in. which this Australian Parliament should deal with it. Our Standing Orders have been most carefully prepared, with a view to having everything done by the Senate, that is to have the force of law, considered in a proper manner. A Bill is taken to one stage, at which objections may be urged against it. It is then taken to other stages, so that the people may have confidence that no measure can be hurried through Parliament. I do not think that the wool position is so terrible, that we need to break away from the precedents of Parliament, in Great Britain for centuries and in Australia in this Parliament for twenty years, in order to cope with it. I do not see why we should lay aside all the safeguards that have been provided against hasty legislation. I feel somewhat elated at being in a position to protest against hasty legislation.
– To defend law and order.
– Yes, to defend law and order. If I could only recall all the hard things said about the Labour party during the last quarter of a century, I might make use of them all to condemn the method of’ procedure now adopted by the Government. Legislative Councils have been elected, and some nominated, and we have often been told that they were deliberately brought into existence to prevent hasty legislation.
– The honorable senator is now playing the part of a Legislative Council.
– I feel that I am. I am in the position of a mau who, having been opposed for trying to do a certain thing for a quarter of a century, can now see the wisdom of avoiding hasty legislation. I am in a position now to tell the Leader of the Government in the Senate, and those supporting him, that there is little or no difference between them and the Industrial Workers of the World, because they are all believers in direct action. They do not in this case adopt the usual method of dealing with such matters in- Parliament. They propose to go direct, and to pull down oldestablished practices and every obstacle which would be set up by the rules of Parliament to prevent them from carrying their design into effect immediately.
The Government introduced this matter, and it has been discussed by Senators Guthrie, Fairbairn, and Pratten in a manner which must have been enlightening to members of the Government, as it was to the rest of the Senate. These honorable senators have discussed the question from the point of view of those interested in the wool industry. Senator Pratten has taken a view in opposition to the Bawra proposals, or, shall I say, to the proposals of Sir John Higgins. He considers that there is danger in them. He has not spoken in opposition to the interests of the wool industry. No man in Australia in his senses would oppose the best interests of the wool industry. No man in Australia - should be hurried into doing anything which might not be in ‘he best interests of the wool industry and the wool producers of Australia. Just as we are all reluctant to do any thing which would injure the wool industry, we should take very fine care that we shall not be asking to-morrow why we allowed, ourselves to be stampeded into taking the action proposed by the Government.
I might indicate what has led to the stampede. The’ first step was taken by the Prime Minister (Mr. Hughes) at Bendigo in a gloomy and pessimistic atterance which should never have been made in Australia. The right, honorable gentleman must have had a bad night, because he made a worse speech still in the House of Representatives. That speech was calculated to injure all the interests of Australia. Coming from myself, it would not have mattered but coming from the Prime Minister, it was a most gloomy picture of our position. We were told that banks were tottering, businesses were failing, the bottom had dropped out of the wool market, and I do not know what , disaster was not foreshadowed. Then the panic started, and now we are to be hurried into action. I think there is no occasion for hurry. Bad as it no doubt would be for the wool market to drop just at the present below pre-war prices, it would not be the worst thing that could happen if people could buy a suit of clothes for £4 10s. which they cannot get to-day for less than £18. I think that I might very quickly make a suggestion which would overcome the difficulty. We have been told that we produce at present only 5 per cent, of the woollen materials we require.
– No. I said that we use only 5 per cent, of our annual production of wool in Australia, but we produce 50 per cent, of the woollen material we require.
– I might put forward a proposal which would immediately double the quantity of wool we use. We might make our woollen mills work three shifts instead of one. That might be done if the people who are controlling wool in Australia are in earnest. There are a great many unemployed, who could be readily broken into” the new business of manufacturing wool.
– If we turned all the wool produced in Australia into cloth, who is going to buy it? The honorable senator’s proposal would not relieve the position one bit.
– Would it not?
Sitting suspended from 6.S0 to 8 p.m.
– I have been advancing a helpful suggestion for Australia to takes? action, in order to show that she could increase her trade, employ her people, and consume her own wool. When I suggested that the mills should be set to work in three shifts, Senator E. D. Millen interjected, “ Where would we get the market for our products t” We would get it by reducing the price of our tweeds and woollen goods generally to somewhere near pre-war rates.. There are many thousands of people in Australia who would purchase woollen goods if their prices were brought down to the popular purchasing power; and, throughout the rest of the world, the same- applies. There is an enormous opening for Australian manufactured goods if we cared to put them on the world’s market at reasonable prices. Moreover, such action would be letting the world see that Australia was attempting to overcome the situation by more work and greater production. I realize that in speaking to this effect I am taking up. the .old Conservative cry, “Work harder and produce more;” but’ I repeat that sincerely at this stage. If we do not go in for such a policy .we shall not get out of the financial tangle into which the people, guided by private enterprise, have got themselves.
– Not private enterprise, but Government control.
– Private enterprise has run us on the’ rocks.
– I have been objecting to Government control time without number, and I repeat that that is the trouble to-day.
– It is of no use to allege that the Government have had any hand in the critical situation of Australia at this moment.. The private Combines, in managing their own affairs, have done so in such a way that to-day we are on the rocks,, and private enterprise is now approaching the Government to float us off. My suggestion of the way out is to work out. The sooner we realize that the impoverishment of a country is not brought about by pushing the sales of the products of that country in other lands, the better for us. The < sooner we learn that the interchange of commodities between nations makes for the enrichment of all, the better for Australia.
The present position is due largely to the loss of the American trade. The official Year-Book informs me that in 1914-15 the United States of America took, in round quantities, 61,000,000 lbs. of our wool; in 1915:16, 115,000,000 lbs.; and in 1916-17, owing to the Pool, only 16,000 lbs.
– There was a suspicion that our wool was going to Germany, via America.
– That does not matter. My point is . that our loss of the American market accounts for the wool surplus to-day, and, consequently, for our critical difficulties. I note, further, that of scoured wool there was exported to America in 1915-16, 27,000,000 lbs. In 1916-17 no scoured wool was exported to the United States of America.
– That was when we had sold all our wool to the British Government.
– There is no doubt concerning what became of it. I am content to show that the cause of the present surplus is our loss of the American market. In the zeal of our patriotism - if I may put it in that way - we have cut off one of our best customers. I remarked on one occasion that patriotism would kill trade, or trade would kill patriotism; and that is quite true. Reverting to the American purchases of our scoured . wool, the quantity for 1917-18 was 1,446,501 lbs.; and in 1918-19, 1,460,000 lbs. It is evident, then, that we have not recovered that lost trade. We have reached a stage when we should not go in for fantastic methods of overcoming our difficulties. We need to know how and why we have lost our wool custom, and how we can get it back. We have lost the trade of America in wool.
– We cannot help that.
– We had a good customer, to whom we refused to supply further goods. Now we must try and get that customer back.
– Did not the American trade practically go through London”?
– I think not.
– I recollect a sale, in one lot, of 500,000 bales, during the period of control.’
– During 1916- 1917, there was certainly nothing of that kind, and America was left practically without wool. I fear that the present Government proposal will not have the required effect of ‘regaining the American trade. The scheme simply involves the putting off of the evil day for six. months, after which there may be a further extension of six months; and, meanwhile, this enormous weight of wool will continue to hang over our heads. We should endeavour to get back and extend our trade with all the nations, and, on the most favorable terms, to get our wool away. Senator E. D. Millen will remember the cry in the wool-sheds, “We want the wool out of the way.”’ To-day our wool is blocking operations, interfering with trade, and affecting all our businesses at a time when the world is crying for woollen goods. If we cannot manufacture our wool into woollen goods for- the world’s markets, let us sell to the countries which will do so, and which will give us the best prices for our raw material - this great primary product of Australia.
– Hasnot wool already been sold on long terms?
– There has been some little of it sold, but there is an enormous accumulation ahead, and the utmost of our export in normal times has been but 2,000,000 bales. It is of no use to try to build up our secondary interests if primary products are placed at hazard. The sooner we induce people to trade with us, the better for Australia. My advice to the Government is, “ Extend Australia’s trade with other nations.” Let us get into contact with Russia.
That country will take all our products.
– And pay for them?
– Of course!
– But all the gold has already been taken out of the Kremlin.
– I do not hold that payment is any the less tangible or satisfactory because it is in kind, and not in cash.
– Is the honorable senator advocating dumping?
– I can refer the honorable senator to many thousands of families who would be only too glad to be enriched at this moment by having goods from other countries dumped into theirbackyards. All the nations are waiting for Australia’s primary products, and Australia is idiotically saying, “You may buy our. goods, but we will not undertake to purchase yours, for that would, be dumping.” Letis demonstrate willingness to enter whole-heartedly into trade in regard to our great primary products.
I now move -
That the following words be added to the amendment: - “and that the Government should give effect to their, proposals by legislation, and not resort to regulations.”’
I do not move this amendment in any hostile spirit, but because I am firmly convinced that whatever the Government may do should, be done in the proper legislative manner. I will not be a party to giving the Government a free hand to do as they like by regulation. If my amendment is not agreed to, I shall still vote against the proposal of the Government, because I am not satisfied that . anything will be achieved other than the postponement of the evil day.
– In seconding the amendment of Senator Gardiner, I do so first and mainly for the reason that I am opposed, , now that the war is over, to Government enactment, in any direction, by regulation, if that can possibly be avoided. I support the amendment, further, for the reason that if a regulation is gazetted under the Customs Act, it can only be promulgated in the event of the export of wool being deemed to be harmful to Australia. I fail to see how the export of wool, just at present, canbe harmful to this country. Should a regulation be gazetted without resort to a special enactment, I foresee the subject-matter undergoing a test in the High Court. I further support the amendment, because a regulation may inflict an injustice upon the small farmer. The position in which he will find himself, should the policy of the Government be effected, will be this: During the period of wool control, after the wool was appraised, the owner got his money. But if the policy of the Government is carried out without some protection being granted to the small farmerowner, his’ wool will be appraised, but he will get no money. It may be that the latter will be heavily pressed for money. The sum of £50 in cash now would be of considerably more benefit than £100 for exactly the same wool in the course of twelve months or more. There are other interests to be protected. I refer to the interests of the fellmongers, wool scourers, wool-top and tweed manufacturers. I do not think that harsh restrictions should be placed either on the export of skins or of skin wool.
Since I have been speaking oh - this subject, I have received a communication from the Victorian Wool Buyers’ Association which, in effect, advocates a scheme to hold up all the Bawra wool. Instead of the debate in both Houses oh this subject, I would have preferred that a Committee be appointed in order to get full information as to the exact position concerning the number of bales that are actually in stock, ‘ and for sale, freight charges, commission, storage, and other miscellaneous items which have to be charged against the gross value of the wool produced. On this point I fail to see extreme urgency at all. I do not think-
– I ask your ruling, Mr. President, on the point whether Senator Pratten is not now making a second speech on the main question, rather than confining himself to Senator Gardiner’s amendment. He is now urging the appointment of a Committee of the two Houses to inquire into the whole problem. I submit that he is not in order.
– Speaking to the point of order, I wish to say that my remarks were intended to show that it would be better, so far as the legislative authority of this Parliament is concerned, to bring in a Bill under which all these matters could be discussed, rather than to do as proposed by regulation.
– Senator Pratten, as Senator Millen has pointed out, now only has the right to discuss the amendment moved by Senator Gardiner, because he has already spoken on the main question, and on the amendment moved by Senator Guthrie.
– I have spoken only once.
– The honorable senator is not entitled to make two speeches on the question. He has spoken on the main question, and has exhausted his right in that respect. He is now only entitled to give reasons why Senator Gardiner’s amendment should or should not be accepted. I must now ask him to confine himself to that aspect of the -question, and not debate the main issue.
– Very well, Mr. President, I shall respect your ruling, and confine myself to my reasons for seconding Senator Gardiner’s amendment. I say that, so far as the secondary industries of the Commonwealth are concerned - I refer to all those industries allied with the wool trade - we must be extremely careful about going back to the conditions that appertained to the period of wool control. I desire to conserve my rights as a member of this Chamber to see that every “ i “ is dotted, and every ‘.’ t “ is crossed in connexion with legislation submitted for my approval or otherwise, and so far as I can see the regulations which the Government may make will not enable me to do this. Therefore, I support Senator Gardiner’s amendment, that the proposals of the Government be embodied in a specific measure. I am doing this with no other desire than to help, the wool growers in the best possible, way.
.- It is not because I believe that any result will follow action by this Senate, but because I know that every honorable senator must stand a certain amount of criticism in connexion with this matter if it comes to a vote, that I rise to place on record my reasons for voting as I intend to vote. To my mind, what Senator Gardiner proposes, that the Government should give effect to this scheme by legislative means, is the right thing to do. I do not know of any position ever having been dealt with as is now proposed by the Government. I understand that members of another place are dealing with this question on a similar motion, so I take it that whichever way the Senate vote goes, the Government need not take any notice, because if they seriously propose to deal with this matter by means of regulation under the Customs Act, they will be guided by the vote in the Chamber where Governments are made and unmade.
– It is hardlyfair for the honorable senator to assume that the Government would not pay respectful attention to a decision of this Chamber.
– I suppose we must at least thank the Minister for the courtesy of the Government in giving us a chance to discuss this matter, but I do not think that the Government would be unduly excited if their proposals were indorsed elsewhere, but were not approve J. in this Chamber.
– At any rate, it is fair to point out that, if such a position arose, and the Government proceeded to give effect to its policy by regulation, the Senate could annul a regulation if it felt so disposed.
– Quite so; but I do not know that I need say any more on that point, except that I favour legislation rather than regulation as a means to give effect to the Government policy. And my reason for supporting the Government proposal as against the amendment submitted by Senator Guthrie is not that I believe it will solve the difficulty entirely, or that I want particularly to look after the interests of the pastoralists, for, despite what has been, said to-day about their having fallen badly in .connexion with wool prices, I think they are well able to look after themselves. I support the Government because I think it is necessary to maintain whatever credit we have abroad. But we must bear in mind that the woolgrowers of Australia made very big profits during the war period, and that, over and above the 15½d. flat rate, they will have distributed amongst them an excess profit of between £15,000,000 and £20,000,000. This might foe used “as a set-off against any probable loss which might accrue owing to the new fixation of ratio in regard to the price. The old axiom referred to this afternoon by Senator Fairbairn concerning the law of supply and demand is, I am afraid, not generally observed, and probably it cannot be observed in dealing with some of the post-war problems with which we are now confronted. While, as I said, I do not think we can hope to solve this problem in the immediate future, I intend to support the Government proposal because I believe that probably within the time fixed, or at least at the expiration of that period, we shall see something which will lead us to believe that the markets of the world, which have been closed on account of war conditions, will be re-opened, so that’ we may be able to get rid of some of this wool, which, in the meantime, has been held off the market. Because the primary industry really stands for so much, and because we need very -much larger credit in England, we should, I think, do all we can to stabilize the wool industry.
.- It is with some hesitation that I address the Senate on this subject to-night, as it is a long time since I had anything to do with wool, although I was brought up on a farm. It seems to me that, if we members of the National party approve of the proposal made by the Government, we shall be running counter to every principle which we have enunciated for a generation past. It is. no .longer war time, and there should be no necessity for ‘ legislation by means of regulations. That pernicious practice grew up during the war, and because of its necessities, and the sooner we cut it out now the better. So much for that point.
In regard to this particular measure I may say that I have always been opposed to trusts and combines, but it seems to me that this proposal is in the direction of encouraging combines. As far as concerns the people, who for good or bad reasons are not disposed to join the association known as Bawra “willy-nilly,’’ we. always opposed the desires of trade unionists to force “blacklegs,” or nonunionists or free-laborers as we call them, to join a particular union whether they liked it or not; and, therefore, it seems to me that we shall be departing from that principle if we approve of these proposals.
– I do not think the 6 per cent, of the wool-growers referred to ever had an opportunity of saying whether they were for or against the scheme.
– By rushing this measure through we are not giving them a chance to say whether they are or not. I have received letters from persons interested in the wool-scouring and fellmongering industry, requesting me to oppose such a proposal as this and to assist in establishing a free market for wool.
– They do not oppose . the scheme. They want a free market for fellmongery wool.
– It was expressed in general terms,., and I am not sufficiently versed in the business to know whether they wanted a free market for all wool or for their own products. While Senator Guthrie - who is so great an authority on, such .questions as this that I am feel- ing very uncomfortable in opposing him - was speaking, he thoroughly lashed, the manufacturers of clothing for selling their goods at high prices. It may not -have occurred 4 to Senator Guthrie that those people are continuing to charge high prices, because they purchased the wool from which the clothing is manufactured at the high price which was insisted upon at that ‘time by what I term the Combine. They, cannot sell their cloth or manufactured articles at a reasonable price without a heavy loss.
– Bawra has only been in existence a few weeks.
– Well, its predecessors in title were responsible. That is the difficulty, and if we adopt the proposal of the Government we shall be strengthening the hands of the Combine and keeping up prices. We may be committed to maintain prices on behalf of other people who are faced with a sudden loss. I believe there is hardly a softgoods firm in the “Lane,” where those who are supposed to be profiteers are to be found, which is not tottering on its foundations.
– What have those people done with the fortunes they made during the last five- years? Have they spent it on motor cars or passed it on to some one else?
– I do not know; but I am told that now at any rate the banks are keeping them on their feet.
We know that the boot manufacturers are deliberately closing down their establishments and dismissing their employees to enable them to unload . the huge stocks accumulated when leather was at a high price. If such is the case these manufacturers are entitled to ask the Government to pass legislation to protect them. If we are to give protection to wool-producers, it will be very difficult to meet the strong criticism on the refusal to pass the basic wage, which at times it is not easy to answer, even now, considering the fact that honorable senators recently increased their salaries. I was not a member of the Senate at that time, and did not Lave an opportunity of recording a vote for or against the proposal.
– Order! The honorable senator must not discuss salaries of honorable senators on this motion.
– It is very difficult for us to reply to the constant bombardment from people demanding a basic wage.
– Order ! The honorable senator is not entitled to discuss the basic wage on this motion.
– I am merely pointing out that if we support this proposal, which is really to provide a basic wage for the wool-producers by allowing them to receive what it actually costs to produce, we shall be met with a similar request from others.-
– It is below the cost of production. o
– At any rate, we would have to meet the position, and would have to answer the shearers when they made a demand for increased wages. It seems that if we are to bring matters back to normal, we must dispense with Government control at the earliest possible moment. I have the greatest sympathy with graziers; I have a brother in New South Wales who is producing wool, and who has to market his product. I would be quite prepared to support the proposition if it were not contrary to long-established principles.
– The honorable senator must live and learn.
– My political education is not complete, and, as Senator Pratten suggested, there is a probability of the proposed cure being worse than the disease because it is by no means sure that, at the end of six months, the position will be any better than it is to-day. There is no reason why we should slaughter our principles, and, as it seems difficult for me to’ change my views so rapidly, I intend to support the amendment moved by Senator -Gardiner.
.- One cannot help recognising that we are called upon to deal with a very important question. It means so much to Australia as a whole that we cannot- afford to look at the matter as affecting one section of the community only. I have been brought up with a community of land workers, and although I have the greatest sympathy with the rural section, I am always averse to legislation which gives an advantage to one section over any other. But realizing as I do, by a perusal of the figures relating to the industry as they affect Australian finance, and knowing the difficulties we shall shortly be confronted with in meeting our commitments, I feel that the Government are justified in giving the Senate an opportunity of discussing this proposal. The value of the wool industry to Australia during the last year of which we had any official record was approximately £42,000,000 ; but it must be remembered that that was the finest year we ever experienced from the wool producing point of view. In a normal year, such as 1914, the export trade in wool was valued at £22,000,000.
– That was a drought year.
– Yes. We are faced with the possibility that this ‘ year will show a much smaller return than 1914.
– - That was a record year for produce; notwithstanding the drought.
– It may have been, but as regards wool it was a lean year, and this year may be similar. In view of the commitments of the Treasurer, the 7>osition is serious.. I do not pretend to know much concerning . the ramifications of Bawra, but I have heard sufficient to convince me that we must do all we possibly can to ensure selling as much of our wool as is practicable at the best possible price. I am not prepared to support the proposal of Senator Guthrie to fix the minimum at a higher rate than that suggested by the Government. It is imperative that we should dispose of as much wool as possible to make room for future clips, and w.e certainly will have a better opportunity of doing so at aminimum of 8d. instead of 9d. per lb. A reduction of1d. per lb. might induce buyers to come into the market, who would otherwise hold off owing to the difficulties of financing their purchases.
– That argument would hold good if the price were fixed at 5d.
– Exactly. It is reasonable to fix the minimum, and I think that suggested by the Government is fair. I am anxious to see every inducement given to people to purchase Ausvralian wool.
– In the honorable senator in favor of any minimum at all ?
– We should have a minimum, and we, should endeavour to assist the pastoralists in their difficulty.
We have been assured that it costs11d. per lb. to produce wool, and it is not unreasonable to suggest that we should fix the minimum at 3d. below the rcost of production.
– How long can we keep going if the cost of production in other countries is less than ours ?
-I do not know. It has been explained this afternoon that a great deal of the wool will have to be sold at from 2d. to 3d. per lb., particularly a good deal of the cross-bred wool, and that the rate of 8d. is an average minimum. It does not follow that because an average rate has been fixed the wool will not be sold at as low as 2d. per lb. in order to maintain the average.
– Thousands of bales will.
– Honorable senators who are keeping in touch with current events must realize that there are many countries that will be glad to purchase our wool, but are in the unfortunate position of being unable to do so.
– Why not sell it to them on long credit ?
– If Bawra can arrange -with countries which have some reasonable hope of meeting their engagements on extended terms of credit, the large holdings controlled by Bawra, should be unloaded as speedily as possible as that would be the means of making room lor the new clips. Such an arrangement would be of great benefit to many of our pastoralists.
– It would pay to take the risk.
– Bawra is already ‘ doing that.
– It is only recently that I ascertained what Bawra really meant. I suggest that by that means a very large quantity of wool stored in London can be placed. Some risk will have to be taken, but it will mean to the pastoralists the deferred payment of a dividend which a year or more ago they had no idea- they would receive. They knew they would receive some dividend, but they did not know what it would amount to.
– That is a dividend in addition to the coming July dividend.
– Exactly. I agree with Senator Gardiner as to the necessity for regaining customers we lost during the last few years. But the honorable senator, by .the figures he quoted, would lead to an entirely erroneous impression as to the value of wool- purchased by America from Australia during the last few years as compared with the value purchased by America from this country some years previously. The honorable senator quoted only figures that apply to scoured and washed, wool. He did not quote figures that apply to wool in the grease.
– I did.
– If I remember correctly, the honorable senator told us that in 1914-15 we exported’ 4,000,000 lbs. of wool to the United States of America; in 1915-16, 27,000,000 lbs.; in 1916-17, nil; 1917-18, 1,446,000 lbs. ; and in 1918-19, 1,460,000 lbs.
– Before that, I mentioned that 115,000,000 lbs. had been sent in grease.
– In 1914-15, we exported to the United States of America 61,000,000 lbs. of wool in the grease; in 1915-16, our export of wool in the grease was 115,000,000 lbs.
– I quoted tb,at figure.
– In 1918-19 we exported to the United States of America, 71,776,000 lbs. in grease, and the previous year only 57,425,000 lbs. So that it will be seen that we are getting our custom back.
– The honorable member is skipping the figure for 1916- 17.
– We sent to the United States of America in that year only 16,174 lbs.
– I quoted that figure also.
– The figures show that in 1918-19 we exported over 71,000,000 lbs. of wool- in the grease to the United States of America as against only 16,000 lbs. in 1916-17. The total value of our exports of wool to the United States of America for the five years ending 1918-19 was £20,876,927, and the value .of our export to the United States of America in 1918-19 was £4,982,056. Senator, Gardiner knows well why we did not send a great deal of our wool to the United States of America during the war period. It was because the British Government required all the wool we could possibly furnish them with, to provide necessary clothing and bedding for the troops.’
– They took the whole of our wool.
– They were wise in doing so, and it was our duty to supply them with all we could produce.
– That is how it happens that there is a surplus of wool now.
– Exactly. They could not foresee exactly the quantity they would require, so they purchased the whole of our wool clip.
– And America bought in London instead of buying here?
– No doubt America bought her requirements through the British Government. It was our duty to give the British Government control of all our wool in orde’ that our troops and the troops of the Allies, as well as the British people and the people of the Allies, should not go short.
– And in order that the Germans should not get any of it.
– Senator Gardiner’s amendment proposes that we should legislate in this matter by the passing of a Bill. I assume that the Government submitted this proposal this afternoon in order to get the opinion of honorable senators upon it, and that they will be guided bv the views we express. If the Government act in this matter by the issue of a regulation under the Customs Act, they will be in a position to amend that regulation, or suspend it, should developments occur between now and next year which would warrant them in adopting that course. But if we were to legislate in the ordinary way by the passage of a Bill to deal with this question, no matter what might eventuate between nowand next year we should have no opportunity of amending the measure.
– Could we not soframe an Act of this Parliament as to cover a contingency like that?
– We have passed measures here before limiting the period of their operation.
– We might, in a Bill, give the Government the same power that they are to-day asking that they should have by the issue of a regulation under the Customs Act. but I can see the danger that might arise to Australia if, by a hard’’ and fast law, we made a provision which could not be altered or amended for another twelve months. It is, I understand, suggested that the regulation proposed to be issued should remain in force for six months. That appears to be long enough. Something might’ happen before that time expires justifying the amendment or repeal of the regulation.
– A month’s experience might show the need for an amendment of the regulation.
– That is so.
One or two statements have been made as to the feeling of people not engaged in -growing wool on the subject of the fixation of the price. I can well understand the average man in the street and his wife, who has to bear the heat and burden of making household expenses come within income, wondering why it is that, with the continual outcry about the low price of wool, everything that they require for themselves or their children in the way of woollen goods manufactured in Australia is at such a high price. I have previously said that, in my view, honorable senators should give publicity to any matter coming under their notice concerning what is occurring from time to time in the Commonwealth. Those who have any knowledge of .fabrics, on looking into the shop windows in which they are exhibited with tickets setting out prices which are said to be less than cost prices, which one always discounts, must have been struck by the price charged for one article which must be used by elderly people, and is used by a great many ‘who are not elderly. I refer to flannel. This article can be manufactured in Australia of better value than in any other part of the world. I say that from knowledge. But, notwithstanding the low price of wool, flannel which was retailed last year in Melbourne and Sydney at 2s. 6d. per yard is now retailed at 2s. lid. per yard. The consumer naturally wonders how this can be when he knows that the price of wool has come down. He knows that during the last few months there has been no increase in the cost of production, and yet the new season’s flannel is being charged for at a higher rate per yard than charged last year, when the price of wool was very much higher than it is to-day. If one tried to probe the anomaly, the excuse given would be that these flannels were made from last year’s clip, but when flannels went up in price Q 50 or 70 per cent., when’ the big rise in commodities took place in Australia, it was not then suggested that the last season’s clip was higher in price than the clip of that year. That is a matter which we should not lose sight of.
– There is no danger that we shall lose sight of it.
– We must have regard for the opinion of all classes - pastoralists, agriculturists, tradesmen, workmen, and the general consumer. I venture to say that eight out of every ten yards of flannel used in Australia is Australian made, and it is being retailed to-day at 2s. lid. per yard, though that flannel can be produced and sold, with a good profit to the mill and to the retailer, for from ls. 9d. to 2s. per yard.
– It is not hard to understand the position. The fact is that the manufacturers will not sell at a reasonable price.
– They may sell at a reasonable price, but I have heard it said that the average retailer cannot buy a roll, .or, for that matter, fifty rolls, of flannel from the manufacturer. It has to go through an intermediary.
– The honorable senator can go to Foy and Gibson’s, where they manufacture their own flannel, and he will have to pay as much for it there.
– If they manufacture their own flannel, they are making a profit out of all proportion to the material and work put into the article. The general public will realize some day that they have been victimized. I have no grudge against employers or manufacturers. My sympathies have always been with business men who believe in a fair deal, but I could not allow this debate to pass without making public what I know in this connexion. -
I cannot see my way at present to support Senator Gardiner’s amendment, as I think it is well that the Government should have power to suspend or amend the proposed regulation if anything to warrant the adoption of such a course should arise before Parliament meets next year.
– I have listened with a good deal of interest this afternoon- to the discussion’’ that has taken place, but I am still in some difficulty concerning what is proposed. We are told that this wool is to be sold at an average rate, according to Bawra anticipations, of 9d. per lb., and the price may go from id. per lb. up to 18d. per lb.
– Up to 24d. per lb.
– We are told at the same time that the cost of produc-tion is within a decimal of lld.per lb., and in the circumstances I am at a loss to know how the average price proposed is made up. If the wool people are selling a large percentage of crossbred wool for 2d. to 3d. per lb., and the cost of production is about lid., we can see inevitable disaster sticking out. I am not in a position, and do not propose, to criticise the scheme of the Government. I would like to help the pastoralists, and I realize that they should know their business. I understand that Bawra is largely made up of representatives of the pastoralists. If that be so, and they are prepared to take 9d., I am prepared to support the proposition.
– As a matter of fact, there are very few pastoralists on the Board of Bawra. Most of the wool in Australia is produced by farmers, and not by pastoralists.
– I do not wish to split words or chop logic with the honorable senator. Whether the wool is produced by farmers or pastoralists does not affect either myself or the situation.
– Wool is produced by wool-growers.
– I am prepared to let it go at that, and to view the position in the light of the ordinary acceptation of the term. My difficulty is to be satisfied whether the wool-growers are content to take an average price of 9d., when we are told that the production cost is lid. I do not know what the exact position is, but I perceive that a great many of the small growers are faced with trouble. No doubt, they made ‘big profits during recent favorable years, but they spent much of their money. Australia has never known such luxury as exists to-day; but bank balances are not big enough to pull all these people through when collapse occurs in the wool market. Australia must have exports, and her export trade must not be permitted to collapse. I understand that we can save a certain proportion of our ex port connexion from collapse by fixing a. minimum of 8d. or 9d. per lb. for our wool, and I am prepared to support the proposal on the basis of 9d. However, Australia is not the only place which has had to cope with similar difficulties. The » United States of America has had her cotton production problem to handle, and ‘ that country has entered into a scheme not unlike thai suggested . by Senator Pratten. That is to say,. America has been selling bor cotton to European countries on long terms, expecting .to get something back, not solely ‘in money, but partly in kind. We are told that we do not want our value back in kind because of the fear of the flooding of our markets with cheap goods. I do not like that argument. It sounds as though we would be prepared to accept the exchange of those goods if they were dear goods.
I intend to support Senator Gardiner’s amendment. I do not like legislation by regulation. I have been looking up the subject of the control of exports under the Customs Act. I understand that control arises under section 112, sub-section b, which states, “ The exportation of which would, in his opinion, be harmful to the Commonwealth.” If that provision is good, why was it deemed necessary to amend it as in Act No. 19 of 1914 ? That Statute provides for the amendment of the previous Act by inserting after sub-section 1 the following : - 1a. In time of war the Governor-General may, by proclamation, prohibit the exportation of any goods.
One would imagine that if there were’ any time in the history of the Commonwealth when the exportation of goods should be prohibited, such course being essential for the safety of the Empire,’ the previous Act would ha ve, covered the position. I note that the Minister in charge of that amending measure stated in the House of Representatives -
The prohibition of expectations contemplated by the Bill is necessary, and it is considered by the Law authorities that there is not sufficient power to enforce it under the law as it now stands.
If that held good then I would take it that it should hold good to-day. If the. situation is so serious that it is essential that the wool industry of Australia should be protected, then we must protect it by an enactment; and if, under the Act of 1914, it was demonstrated that there was this apparent flaw in the previous legislation - so that the amending Act became necessary - surely it would be wise to bring this whole proposition having to do with wool under an enactment, in order to make it stable I am given to understand that the situation is, indeed, extremely serious. That being so, we cannot afford to have the activities of the Government in regard to the matter, carried on for a time, only, to find that, upon reference to the High Court, that body may throw the whole business in the melting pot.
– Like other honorable senators who’ have not a great deal of practical acquaintance with the wool industry, much of the debate to-day has been, to myself, highly educative. I feel to some extent at a loss unless I can be assured that behind the proposal of the Government there is the support of the great bulk of the wool-growers, both large and small.
Senator J. D. Millen has referred to the loss which will certainly be incurred by some of the growers, even if the minimum average rate be fixed at 9d. instead of 8d. Some of the wool, it has been stated, will be of the cross-bred variety, and it is likely to be sold at as low as 2d. per lb. I am not sufficiently acquainted with all the details of the scheme to understand whether every individual grower will have returned to him from the realization the precise amount which his wool has realized, or whether the fixing of the average at a particular figure will affect him at all. Will the small grower, who forwards a certain quantity of cross-bred wool of a grade which realizes only 2d. per lb, participate solely to that extent in the proceeds of the Pool?
– That is so.
– Then it will not matter to him whether the minimum be fixed at 8d. or 9d.
– It will, because the appraisement is done on the 848 types of wool in Australia at a ratio which is a fair proportion to 8d. If the average basis is made 10d., then wool sold at 2d. will average up to 2id. ; whereas, if the basis is 8d., the price for that same wool will be only 2d.
– I now appreciate that to some extent each grower will be affected, and will thus have some interest in the matter of fixing the minimum average rate. I am inclined tq support the proposal to make the minimum average the sum specified by Senator Guthrie rather than that indicated in the proposal of the Government.
As to whether the whole business should be dealt with by legislation or according to the procedure indicated by the Minister (Senator E. D. Millen) in his statement, I interjected, when the Minister was speaking, that this was a matter which should be dealt with by legislation rather than wholly and solely by regulation. There has been a good deal of unnecessary legislation by regulation. That, however, has been inevitable and inescapable. In many Bills, which, subsequently became Acts, the Legislature could only outline principles. With respect .to many details we have had to leave them to be dealt with by regulation as circumstances arose; and only experience of the administration of the Act in question has revealed the necessity for regulation. It would be almost impossible to carry on the administration of an A.ct, however comprehensive and detailed in character, if, whenever experience showed the need for some greater smoothness in working, it were absolutely necessary to wait until Parliament had met in order to add to or supplement the Act. I might say here that an Act cannot be amended by regulation. We find in many of our more important Statutes, which involve great administrative control, that authority is expressly delegated to the Executive to make regulations, within certain limits, to carry into effect the purposes of the Act. When the Minister for Repatriation was speaking, I asked why the proposal in respect to wool could’ not be treated as Parliament treated the Butter Agreement last year. When the war period had ended, there was no longer power, to ‘deal with butter as “hitherto. However, representatives of the- butter producers in Australia went Home and negotiated a contract with the Imperial Government. In order to secure the observance of that contract by all the butter producers in the Commonwealth, representatives of the growers, and the growers themselves, next asked the Federal Government to assist them. The Government did not prepare to organize them into a pool, but introduced! and passed legislation whereby the-
Minister concerned was given power, during a certain period, to prohibit the export from Australia of any butter unless satisfied that it was going to be exported under -arrangement’ and in conformity with the requirements of the butter organization. I have examined the Statute in question, namely, Act No. 20 of 1920. It comprises only a few sections. There is the short title, and then there is that section which is the most effective of all, providing that the Governor-General may by proclamation prohibit the export of any butter unless satisfied that it is being exported in conformity with the conditions of the arrangement made between the representatives of the butter producers of Australia and the British Government. The next section provides that any of the butter so prohibited to be exported should be then regarded as and deemed to be a prohibited export under the previous Customs Act - to which Senator J. D. Millen has just referred. Although we adopted’ the direct legislative method of dealing with the problem,, there then comes that inevitable section to the effect that the GovernorGeneral may make regulations. So, if we follow the course suggested by Senator Gardiner,, that this proposal of the Government in respect of wool be sanctioned by legislation, I am willing to guarantee that one of the clauses, and probably the most important, in whatever Bill is submitted, will be to the effect- that the Governor-General may make regulations tq carry info effect “ the purposes of this Act.” In speaking after this manner, I. aim not against the desire for legislative enactment. I favour it. But I quite perceive that we shall still have to agree to make provision, for supplementing whatever details are put into the Bill with the power to make regulations. I do not anticipate that if the Government introduce a Bill modelled on the Statute dealing with butter export, they will have had sufficient experience to be able to forecast the necessary regulations and embrace them in a schedule.
– The -honorable senator does not object to the regulations, provided that they come under a Bill?
– I do not, but I warn honorable senators that they cannot deal with this matter-wholly in an Act of Parliament. An Act in its scope and effect would be practically a legislative expression of the intentions of the Govern ment as indicated by the Minister with regard to a proposition. I am in favour of legislative action, but I wish honorable senators to understand that I do not anticipate, and 1 do not think the Senate should anticipate, that we are going to get what we require in such detail as will necessarily and in ordinary practical experience have to be provided for by regulation hereafter.
Coming to the matter referred to by Senator J. D. Millen, the honorable senator quoted the section of the Customs Act dealing with the power to prohibit exports in certain circumstances. I did not catch all that the honorable senator quoted, * and I have not recently looked - at the section referred to; but, speaking offhand, I should say that its original purpose” was to empower the Minister in certain circumstances to prohibit exports of certain articles, not as a general thing, but in what we may call extreme circumstances. Then came the war, and it was thought desirable, under certain conditions, to prohibit wholly the export of certain products. I think that probably the law officers of the Crown wisely advised that the original section, though it might be used, could not be used with safety and security, and that there might be actions against the Government if the law were invoked in “a general and wholesale way. Therefore, Parliament was induced to give such general power expressly and directly, and for the purposes of the war.-. That, I think, was the only reason why it was introduced.
– Sub-section a of section 112 deals with the question of arms, explosives, military and naval stores, and so forth. 1
– Exactly. The original Act was designed to operate under ordinary circumstances, and we gave the prohibiting power to be used in certain emergencies. But it was not intended that this power should be used in a wholesale way.
When it was to be used in the interests of the Empire during war, for abundant caution if for nothing else, and in order that there should be no doubt about the validity of the exercise of this power, Parliament was asked, and expressly gave, the Minister authority to exercise this power for war purposes. I do not think that the giving of that power in any way indicated that the original provision in the Customs Act did not meet all requirements in normal times.
In the legislation passed last year there is express provision that under certain circumstances the export of butter could be prohibited, and deemed to be a prohibited export under the original Customs Act, so that in passing that provision we were strengthening the Act in every possible way.
SenatorE. D. Millen. - There would be no necessity,’ then, to add that section to the Act.
– Prohibition would depend on the Act, and the consequences of attempting to avoid it would be the consequences we imposed by the Act itself. But, in addition, we also say that it would be a prohibited export under the Customs Act, and the consequences provided for in that Act would also become operative.
Having said this much, I propose, if the matter is put to a vote, to support the amendment moved by Senator Gardiner, although I do not . think it is going to carry us much further than to affirm the principle that the Senate, in dealing with this matter, must, as far as it can, assert that it should not be wholly left to persons outside Parliament. If the question of the minimum average rate comes to the vote I intend to support the proposal indicated by Senator Guthrie.
– In view of the fact that all our laws must be uniform, can we by regulation permit one section of the community to export wool and prevent another from doing so?
– There would be no question of uniformity involved.
– All people will be under the same bond, and will be entitled to the same opportunities.
– That will be the position.
– Although it may savour of temerity on the part of one who has not the slightest connexion with wool producing, and the marketing of the product, and all the industries incidental to the main one, to have anything to say upon this question at all, my experience of life has taught me that it is not always those who are most directly associated with a matter that are the best judges as to what should be done. I did not rise for the purpose of criticising the objective of this scheme. The objective is laudable enough. All human life is a matter of expediency. We have to do what is often the best thing in the circumstances.
– A choice of evils ?
– Yes. I was only privileged to. hear the Minister (Senator E. D. Millen) for a few minutes, as I had to go out of this chamber, but I understand he was diffident,- and not prepared to forecast- with any degree of exactitude the outcome of the scheme.
– I am not reckless enough to do that.
– No; I do not think any one in this chamber would care to venture a definite prophecy as to where this thing is going to lead us. That being so, it is just as well to point out certain features of the scheme which seem to indicate its economical unsoundness.
– Can you give us anything better?
– I may be able to do that. I admit that those who are most directly concerned’ in the industry are in favour of the proposal submitted to the Senate, but I say that I would not care if the whole of the pastoralists of Australia were in favour of the scheme. If I thought it was wrong, I would exercise my own discretion, and vote against it.
I have said that it is a matter of expediency, and it is just as well to indicate what we are doing, because, whether for good or evil, this proposed action, will be quoted as a precedent before many years have gone over our heads. If I may be permitted to say so, we are endeavouring to do with wool what the much-decried miners of Great Britain are endeavouring -to do with coal. In other words, they have been enjoying certain benefits - perhaps much-deserved . benefits- - in the way of improved wages and working conditions consequent on the high price of coal produced during the war. Naturally, they do not want that price to be reduced, any more than we wantwool tobe cheaper. But their protest against a reduction in the production of coal has resulted in other countries getting a hold of markets that were previously supplied with British coal. It is a well-known axiom in commerce that a. market lost is very difficult to regain. I think Senator Gardiner made some similar observation in regard to the wool market in America, and Senator Payne endeavoured, in his turn, to prove, I hope to his own satisfaction, that that market is being restored. But it is hard to regain trade, and it is because the British miners believe that the price of coal should be sustained in the face of obvious economic difficulties that Great Britain is in danger of losing her coal trade, and, in fact, is in grave danger of losing her prestige as a manufacturing country.
– That is what we have to avoid as regards wool.
– I point this out with all due respect to Senator Guthrie, who has most patriotically and carefully busied himself for some time past in educating honorable senators and members of, another place into that frame of mind which he believes will enable them to take action which I am honestly convinced he is thoroughly satisfied will he in the best interests of the Commonwealth.
– The Government took drastic action recently to save the carbide industry.
– Yes, and, as I have said, it was an expedient. The Government has taken drastic action for some years to save the Queensland sugar industry.
– No. To prevent the exportation of sugar.
– The Government, I hope, will take somewhat similar action in connexion with another important industry in Tasmania, not altogether connected with carbide.
– But I referred to the carbide as an Australian, not a Tasmanian, industry.
– It is an Australian industry, particularly fostered and developed by Tasmania, if the honorable senator cares to have it that way.
It is well to put on record the belief that we are treading a very devious and dangerous path in regard to this proposal to help the wool industry. I would not mind any charge of a breach of long-held principles that may be made against me in regard to my vote if I thought any contemplated action by the Government was going to be a success; but I have very grave fears that the objective we have in view cannot be realized. “I will try to explain why I think it will not be wise to anticipate success from our intended action. This proposed legislation is supposed to be necessitated by a break-, away on the part of 6 or 7 per cent, of the wool-growers of Australia from the scheme which has been formulated to protect the industry. I have nothing to say about the willingness of those people, if they were given an opportunity, to come into the scheme. I am dealing with ‘ the economic position, and the probable result of the proposed action. If we produce only 25 per cent, of the rough stuff in wool, how are we going to meet the breakaway - because it is a breakaway - of the other 75 per cent, of the world’s producers? Fully 75 per cent, of the world’s producers will be selling in a free market quite apart from the breakers away from the Australian situation. There is no doubt about that.
– There is only the Argentine.
– If there are 75 per cent, of the world’s producers selling in a free market, how can legislation enacted by this Parliament be effective in regard to the breakaway of only 6 per cent, of the 25 per cent, protected ?
– How much other wool is being sold in the markets in which we sell?
– That produced by 75 per cent, of the world’s producers.
– Not at all. The only competitor we have is the Argentine.
– I do not believe that at present there are any manufacturers of woollen goods in the Argentine. I believe they export the whole of their product. There are other countries that produce wool. 1
– Not for export.
– What does South Africa do with her wool?
– South Africa pro: duces all merino wool, and we have the predominating influence in that connexion.
– I am merely dealing with the situation as it appears to me from figures quoted by Senator Guthrie, who said that we only produce 25 per cent, of the rough wool.-
– I did not say that. We produce 25 per cent.1 of the world’s output irrespective of whether it is coarse or fine, and apart altogether from where it is sold.We only produce 36 per cent, of crossbred wool.
– If such is the case I am afraid the honorable senator’s statement supports mine in connexion with the economic situation, and that is that whatever action we take will nothave any beneficial effect in the direction we desire.
– What is the posir tion in the markets in which we do sell?
– We are in competition with a quantity of rough wool which is greater than that which we produce.
– Senator Guthrie says that it does not come into the same market.
– As honorable senators seem to think there are difficulties in the way I shall not pursue this line of argument any further, because I do not want to unduly distress them, but to point out that in my humble opinion we shall not secure the economic result we are aiming at. The thought that must be in the minds of all of us is the method of using the Customs Act to prohibit exports in time of peace. Anything is justified in time of war, but there were some who cavilled at what the Government thought fit to do even then. The psychology of the people in times of peace is quite different from the psychology of the people in times of war, and although we consented to the practical suspension of a habeas car-pus in times of war, are we prepared in times of peace to accept such a situation in the administration of justice? This proposal is after all based on war legislation, and I am prepared to admit that it is dealing with a matter which is the outcome of war. Nevertheless, it is a somewhat hazardous method to employ in times of peace. If we do this now, there will come a time in the ebb and flow of matters politically when a Government will be in charge of the administration of the affairs o’f the Commonwealth which will submit a policy that will probably be obnoxious to nearly all the members of this Chamber as it is at present constituted. In other words, a Government may be in power to which the members of the party I belong to will be openly hostile. What sort of a precedent are we establishing? We are giving them the oppor tunity of following the course the Government are now suggesting in connexion with anything they may caTe to do, however sinister ‘it may appear to be.
I am not going to impede the passage of what I believe will have the support of a majority of this Chamber. I believe that Australian legislators are prepared to take the risk, and give the people of Australia who produce the wool an opportunity of improving their position. Long, long ago, during the time of the debates on the Federal land tax, we were told that sheep were butting men off the land in Australia, and I was able to hold up to audiences I addressed graphs and pictures from the Commonwealth Year- Book, and other publications prepared by Mr. . Knibbs, somewhat on a pyramidical scale, showing that the prosperity of Australia centred largely on the wool industry. It was regarded as the one big block of granite supporting all other Australian industries. I used -to say, “Lord, bless my soul! Let me read how many millions Australia receives from the pastoral industry ! “ There was so much from agriculture, which represented a fair number of bricks, a smaller number representing the mining industry, and still smaller numbers representing forestry, ‘poultry farming, and bee farming, which were almost infinitesimal in size. The prosperity of Australia is Teally based upon the pastoral industry. There is no doubt about that. Australia has been referred to by poets and flowery writers as the Land of the Golden Fleece, and the Golden Fleece is in our Australian coat-of-arms.
I do not lightly regard any unsatisfactory position in the pastoral industry, and if we can assist the industry out of its present difficulty, let us by all means do it. Very reluctantly I intend to cast my vote in favour of the intended course of action, the reluctance not arising altogether because I believe our action is something different from our usual practice, but because I hope the step may bring success. I am, however, extremely doubtful of its success, and I am sure that economically our action is on all fours with that which the coal miners of Great Britain desire the Government to take in regard to coal, and which the Government would be exceedingly unwise to attempt. We are plucky enough to take the risk, hut in the name of common sense and sound economics do not let us anticipate very much from the action we propose taking.
– I ani afraid that some of those who are conversant with the position have not made themselves as clear .as they might have done. Of course, many of us have been connected with the wool business for many years, and it is unreasonable to expect such honorable senators as Senator Bakhap, who have only looked at the proposition casually, to understand the real position at a glance. Senator Bakhap compared the position of the wool-growers with the coal miners in England ; but, if we had been contending for the 15$d., which was the price ruling during the war period, some such comparison could be made. If the coal miners in Great Britain would accept a wage which would enable the mines to be carried on, they would be in a similar position to that desired by the woolgrowers in Australia.
I am as much opposed to government by regulation as any one could possibly be, but I do not look upon this as government by regulation in the ordinary sense. If a regulation is issued, it will not be on the authority of the Minister for Trade and Customs (Mr. Greene), but on the authority of Parliament, and, as such, will be similar to an Act of Parliament, which expresses the will of both Houses. We know that both branches of the Legislature are at present discussing this proposal, and, in these circumstances, it cannot be compared with a regulation issued in war time. If the precedent which the Government are establishing is followed by a Labour Government, that Labour Government will also have to submit a motion to Parliament so that the matter can be fully discussed.
– If we had the actual regulation before us there would be a great deal in what the honorable senator says; but we have no knowledge of what will be embodied in the regulation.
– The Senate does not know what it embodies in regulations framed under an Act.
– Regulations can only be in conformity with the principle of that Act under-which they are framed.
– We know the time required to pass a Bill through both
Houses of Parliament, and if a measure were passed to cover the position, the hands- of the Government would be tied. It may be necessary to extend the term beyond six months, and as Parliament may not be in session when that period expires, the Government would not have an opportunity of extending it without summoning Parliament. If it is left, as suggested, the Government can take the risk of extending the period, and placing the regulation before Parliament in the ordinary way. I do. not wish to see the Government hampered in any way, because whatever is done must be done quickly. The wool sales commence on the 16th of this month, and if the situation is still chaotic, probably we shall not be -able to sell any wool at all. The market is panicky, and if no price is fixed before the 16th May, when the wool sales commence, the result will probably be that no wool will be sold. I know that it is a leap in the dark, as Senator Bakhap suggests, but there seems to be no other alternative. I do not think any one ob.jects to a regulation being issued when it has the support of both Houses of Parliament.
– If honorable senators believe in the issue of such a regulation it is better to act quickly.
– That is why I am stressing the point and favoring a regulation instead’ of a Bill.
– There would be just as many regulations under an Act if one were passed.
– Possibly so. Even if we are establishing a dangerous precedent we know that the question has been fully debated. We are endeavouring to meet the urgent necessities of the wool trade, and the introduction of a Bill might be the means of deferring action for a considerable time.
.- I desire to say a word or two on the question before the Senate. I have to confess that after listening to many eloquent speeches I . see little more daylight than I did when the discussion started. I realize that the small farmer is going to be crushed in an/ circumstances. That is a most serious matter. In the last two orthree years hundreds of farmers have gone on to land of high value, based on prices received for the products of the land during the last three or four years. Many hundreds of these farmers are returned soldiers who fought in the war,. which, was responsible to some extent for the conditions with which we are now faced. I am not satisfied with the. proposed allotment of two bales of Bawra and one bale of this season’s clip.
– No, two of Bawra and four of this season’s clip.
– That is very much better. I misunderstood ‘ the proposal. The whole position is most intricate. I feel at present that I should support Senator Guthrie’.* proposal that the price fixed should be 9d. per lb. I am not quite satisfied that the position will be improved by fixing the price at 9d. rather than at 8d. per lb. as proposed by tho Government, because as Senator Guthrie pointed out, other countries will have an advantage over us in being able to produce wool for 3d. per lb. less than we can produce it here.
– I never made any such statement. What I said was that if our competitors in the Argentine wish to undersell us in the production of crossbred wool they would have to sell at under 3d. I did not say that they could produce the wool more cheaply than we can.
– I understood the honorable senator to say that wool could be produced more cheaply in the Argentine than in Australia. Even though it should cost as much to produce wool there as here the Argentine growers will still be in a better position than growers in Australia because they are nearer the market. What is proposed really is that we should fix a standard price for them, and we fix a minimum price which will pay them in all circumstances to put their wool on the market. If it costs them less to produce and market 4heir wool than it costs us and we fix a flat rate at which it will pay them to produce wool, they can undercut us by id. per lb. at any time.
– It will not pay them. We aim only at preventing the total collapse of the industry. It is not suggested that the price proposed to be fixed will pay for the production of crossbred wool. It will not pay the cost of shearing a Lincoln fleece.
– They will be in a better position to rig the market than we are in. I acknowledge that Senators Guthrie and Fairbairn have given considerable study to this particular question, and as no other scheme likely to benefit the wool-growers is submitted, I feel that
I shall be justified in supporting the proposal those honorable senators have made. I feel that if I failed to do so when the interests of so many of the small men who are the backbone of the country are at stake I should be doing ah injury to Victoria and to Australia as a whole. I am therefore prepared to take all the risks of supporting their proposal and to break all precedents to secure the safety of the yeomen of this country upon whom the prosperity of the Commonwealth depends.
– Oan the honorable senator guarantee that this proposal will save them?
– I cannot, and if any honorable senator can put forward a better scheme, I shall be ready to support it. I cannot myself suggest a better scheme. I feel sure that the keenest brains, not only in Australia, but in the world, have been concentrated upon this question, and inadequate as it may ap- i pear to be, this seems to be the only proposal made for the salvation of the wool industry.
– Just as many representative pastoralists advocate the holding up of Bawra stocks as are advocating this proposal.
– I have every sympathy with those to whom Senator Pratten refers. But we have to legislate immediately to meet the conditions with which we are- confronted. I am chiefly concerned to protect the interests of the small grower.
– We differ only with regard to the method of protecting those interests.
– I do not believe that the people to whom Senator Pratten refers are out to cut the ground from under the feet of the wool -growers of the country. I believe that they are quite sincere in the proposal they make.
– There are others besides wool-buyers who approve of the scheme of holding up Bawra stocks.
– I agree that there are, and if what they propose could be carried out it might be the best course to adopt. If it were possible to hold up Bawra wool for two years until the devastated countries of Europe had time to recover financially, we should certainly be in a better position to deal with the whole matter. We cannot, however, afford to wait, and Bawra is controlled to some extent by the British Government.
– Would it not be a question of negotiations between this Government and the British Government?
– It would; but I think that time will not permit of such negotiations. The people of the devastated countries of Europe have been brought face to face with a cold realization of the fact that it is for them either to work or to die. When people of the stamina of Italians, Germans, Belgians, and Russians, are face to face with such a fact, we can be assured that they will recover their normal condition more quickly than perhaps we at present anticipate. If we could wait, perhaps the best possible way in which to deal with the question would be to hold up the Bawra wool, if at the same time the Government guaranteed’ to the wool-growers of the country a reasonable amount to carry them on. That, if it were possible, would bridge the difficulty and meet, the views, not only of buyers’, but of small men engaged in growing wool. It would be the salvation of the small men. I realize that under the scheme now proposed the small men must go under. That cannot be avoided. It is a question of the survival of the fittest. . If what Senator Pratten suggests could be brought about, it would be well ; but I cannot see how it is to be brought about in the time at our disposal. With a resurrected Europe we would have nothing to fear.
– Mr. Hughes might be able to arrange something of the kind.
– It is possible that that is one of the things which the Prime Minister (Mr. Hughes) may be capable of doing. He may strike the psychological moment, and may get into touch with the right minds to solve the difficulty.
– I believe that if the combination of the two ideas could be brought about, it would probably be completely successful in coping with the position.
– In the circumstances with which we are confronted, I intend to support the Government’s proposal.
– I may not have expressed myself very clearly this afternoon, but there appears to me to be an impression created that some of us have axes to grind. I should like to explain that, personally, I have no axe to grind, and am not in this matter representing any company or any particular section of the community.
– Order!’ That question does not arise on the amendment to which the honorable senator is speaking.
– Senator J. D. Millen, in speaking to the amendment before, the -Senate, said he could not understand how, if the. cost of production was lid. per lb.., and we propose to sell at a flat rate of 9d., and some wool would be sold at 2d. or 3d. per lb., we could expect to carry on.
– Order ! That matter does not arise on the amendment either. The honorable senator is now speaking to the general question. He is replying to statements made in the debate on the general question. He is entitled at present only to address himself to the second amendment, moved by Senator Gardiner.
. Mr. President-
– -Does the honorable senator propose to speak in reply?
– The amendment must be disposed of before the honorable senator is entitled to speak in reply to the general debate.
– One matter to which I wish to refer has a reference to the amendment, and I shall speak upon that. Have I the right to cover both amendments in my remarks ?
– The honorable senator is entitled to speak to both amendments, but not in reply to the general debate.
– The amendment submitted by Senator Gardiner is a proposal that the Government should proceed by way of legislation. In debating that amendment honorable senators urged many objections against regulations, and I want to point out that those objections would apply with equal force to legislation. It has been said, for instance, that under a regulation the small farmer might be hurt, but he might be hurt by legislation just as much.
– But if we proceeded by legislation, would we not have an opportunity of discussing that?
– The honorable senator has had that opportunity today, and has taken advantage of it twice. In any case, the honorable gentleman would not know the nature of a regulation until it was issued. Whatever Bill may be introduced it must contain provision giving power to the Executive to make regulations ; and it stands to.reason that no one would know, until those regulations had been gazetted, what they, were and what would be their purport.
– It may be taken for granted that any regulations issued will be bound to be in conformity with the Act.
Another objection which an honorable senator has voiced to-day is contained in the suggestion that if the Government proceed with their proposition by way of regulation the latter may be taken to Court and pronounced ultra vires. I would point out that such procedure could apply just as easily to a measure passed by Parliament as to a regulation framed by the Executive without reference to any Statute.
– I was referring to the powers under the Customs Act, and not to such powers as may be embraced in a new Bill.
– If this Parliament were to pass a special Bill dealing with the proposition of the Government, and the Executive were subsequently to issue regulations, those regulations could be just as much endangered by challenge before the Courts as any regulations made under the Customs Act itself.
– I was referring to the question whether the export of wool would be harmful to Australia under the present Customs Act.
– Many of the objections which have been urged concerning the dangers lying in the Executive proceeding by regulation could be urged with equal force against the powers sought to be taken by way of legislation. As Senator Keating has lucidly pointed out, we cannot have a Bill which may be regarded as complete unless there is provision therein for the Executive to make regulations. Therefore, the Government must be trusted in this as in all similar circumstances. I have examined the Act referred to by Senator Keating, and I draw the attention of honorable senators to the fact that it is contained upon the side of one sheet of paper, while the regulations under it occupy both sides of a similar sheet.
The Government invited honorable senators to discuss their proposal, and to co-operate in bringing it about. The Government have not thought for one moment of proceeding by regulation merely to avoid the necessity for introducing legislation. But we thought, and still think, there is very great danger in proceeding along unexplored, paths iri tying the hands of the Executive too tightly. Even those honorable senators who have advocated the scheme point out that the proposal is leading us into unknown territory. The Government did not advance their proposition with any very robust faith in its efficacy. Let us suppose that we were to pass an Act of an extremely binding nature. At the other extreme we could enact a law which would be so general that all its potency would be brought to bear through the regulations framed under it. But that would leave us in no better case. If we were to pass an Act too tightly drawn, and which removed from the Executive any power to alter that which was specifically contained in the Statute, a dangerous position might arise.
– What about the happy medium ?
– The Government have not always the brain-wave necessary to suggest the happy medium. An Act, if it were so hard and fast as to leave no degree of elasticity in its administration, might involve this country in very grave danger if something should happen during recess, which required instant action or immediate modification. If whatever Act was passed were drawn so generally as to require the framing of regulations-
– It would involve,, at any rate, the assertion and maintenance of control by Parliament.
– That would’ be so if we proceeded to govern by regulation without consulting Parliament. But there is a difference in the Government shaping regulations upon an entirely new subject, without reference to Parliament, compared with our declining to move unless Parliament had first expressed an opinion concerning the course proposed’. That latter action represents what has been done on the* present occasion. The Government have informed both Houses of what they propose. In brief, it is to endorse the Bawra proposal, with a modification of the selling price. Nothing, whether by way of legis- lation or otherwise, can effect that, and were we to proceed to put it into effect by regulation or legislation the result would not be different.
– Is the Bawra proposal confined entirely to export wool?
– That is so. Any one can sell wool to anybody in Australia, and at any price he likes.
– I have been informed that that also could be regulated under the Customs Act, and I am curious to know how, if such is the case.
– I am sorry that the honorable senator has been misled, but it has certainly not been from anything I have said. The Commonwealth has no constitutional power to prevent the sale of wool within Australia. Our powers can only become operative through our authority over export.
I ask Senator Gardiner to withdraw his amendment for the reasons I have indicated. The opinion of the Senate has been sought and secured, and the Government only desire to obtain support for its proposals. I ask that the amendment be withdrawn for the reason that the whole matter will not be given effect to until either a Bill has been introduced and passed or a series of resolutions has been agreed to setting out precisely what would, in either circumstances, be contained in the Bill.
– I will accept that.
– Whatever power is sought to be given effect to - either under a special Act or by a series of resolutions - administration must be in the hands of the Customs Department. Many sections of the Customs Act will be involved. The whole matter is now under review by the CrownLaw authorities, in order that they may see how far the necessary portions of the Customs Act may be safely taken out and introduced into another enactment, or whether it will not be preferable for the Government to place a series of specific motions before Parliament.
– With the consent of the Senate, I am willing to withdraw my amendment. I moved it largely because I saw a. danger of the method of procedure indicated by the Government being ineffectual.
Amendment, by leave, withdrawn.
– With respect to the amendment of Senator Guthrie, I ask that he also withdraw, in view of the promise given by the Government, under the terms of which this same subject-matter must again come before the Senate. The honorable senator will then have his opportunity, if he sees fit, to propose his amendment, and that would be the proper opportunity for so doing. If his amendment is withdrawn at this stage, and the original proposal of the Government is agreed to, I shall be justified in assuming that the Senate is in agreement with the proposition, but that it desires to have it set out specifically in one or other of the forms which have been outlined.
– Under those conditions I am quite agreeable, if permitted, to the withdrawal of my amendment.
Amendment, by leave,- withdrawn.
– I need not . detain honorable senators long upon the main question itself; but I am entitled to point out, in answer to various criticisms uttered during the debate, that the Government are not in any way responsible for the situation which has arisen with respect to wool. One or two honorable senators have expressed the opinion that, in some manner, this was just another of the responsibilities of the Government. I hope it will not be mentioned outside of this chamber, but the Government have probably committed sins enough on their own account without being asked to carry responsibility for the misfortunes of others. The Government are not seeking to interfere. We did not come forward in an endeavour to thrust ourselves into other people’s difficulties, and we have, not sought to impose our will upon any one. When confronted with a request, which was practically unanimous, from many of the interests involvedaround the growing of wool - when we were requested to come in and lend a hand - we thought it right and proper to see if it were possible to smooth the difficulties away. Much has been said about the Government striving to interfere in the trade and commerce of the country. I do not want a false impression to go abroad concerning the real attitude of the Government in this matter.
One phase which was referred to by Senator Fairbairn had to do with the position of the fellmongers and scourers. That pointhas been brought under the notice of the Government. It is a little intricate and complicated. . There are circumstances connected with the industries which would appear to require some special treatment. The Government are now seeking advice from those most competent to express opinions and assist us in the matter. Without definitely committing myself, I desire to state that some provision will be made to meet the position which Senator Fairbairn has pointed out.
I only wish to direct attention, further, to the fact that among the honorable senators who have spoken, 95 per cent, of them have addressed the Senate in tones of criticism of the Government’s proposal, but that no two of them have agreed in the views which they have expressed. While they have been critics of the Government’s proposal, they have not agreed either upon the line of criticism or in pointing out what was wrong with our scheme, or in advancing alternatives.
– They have not proposed any alternatives.
– It is almost impossible, without knowing the details of the wool sold and the various grades offered, to suggest an alternative.
– I cannot see that any deatils regarding the wool sold can affect the position, nor would the situation be in the ‘slightest degree changed if the commodity were lead, rather than wool. The whole position has arisen from the fact of there being a too abundant supply in relation to the absorbing capacity of the world; and the problem would have been the same whether the commodity were wool, coal, lead, or anything else. I hope that when the opportunity occurs we shall have the pleasure of hearing Senator Gardiner discuss the advantages of renewed and increased trade with other countries. But I should like to correct his statement as to the attitude of the United States of America towards Australian wool. It seems to me that America is doing just what Senator Gardiner says Australia ought to do, namely, protect’ the home market for her own wool.
– That is a fallacy the truth of which you taught me years ago.
– That is one of the greatest compliments that ‘has ever been paid to me in my life. ‘If, when I preach fallacies, truth results, then I shall have accomplished much. I should like to say a word or two with regard to the American anti-dumping law, about which we have heard so much of late. America has seen Australia with big quantities of wool likely to come into competition with her own, and also with her cotton, and she has done just what Australia has done in similar circumstances. We have an anti-dumping law on our statute-books, and, therefore, we cannot quarrel with the United States of America for passing similar legislation. But the real difficulty from our point of view is not the loss of the American market alone, valuable though it was. The purchasing power of the world to-day, compared with what it was ten years ago, is negligible. America may buy less, and some other country more, but the central, dominating factor is that we are growing and possess more wool than the world can buy. Do honorable senators consider where these proposals to sell wool on lengthy credits to an impoverished and bankrupt Europe will lead us? Is it not clear that if we do this we shall be rendering English spindles idle?
– Not if we sell for internal consumption only.
– That would mean, then, that English spindles could not make and sell to those countries?
– But if they cannot buy our cheap wool, how much less can they buy English tweeds?
– If, by reason of a lessened purchasing power, they cannot absorb our wool, selling to them on long terms . must render English spindles idle.
– That is not so.
– I have as much right to an expression of my view as Senator Guthrie has to his. My experiences in Europe recently justify me in asserting that thisquestion of international credits was criticised by men thoroughly competent to question it. There is in England a very great fear that a system of international credits, designed to restore the shattered manufactories of Europe, would deal a deadly blow at the manufactories of England. This is a very genuine fear, and I decline to believe that it exists entirely in the imagination. It seemed to me to be quite a reasonable fear.
SenatorCrawford. - If we deal exclusively with England, England should return the compliment.
– I do not think that Australia has the slightest justification to talk in that way about England. Our wool has been paid for; and, though England has every right to put it on the market, she has very generously compromised, in the interests of the Australian wool-grower, by agreeing that only one bale shall be placed on the market for every two bales of the new clip.
– England has not enough spindles to work the whole of the Australian clip.
– And not enough people to buy and pay for it. The solution of the difficulty depends entirely upon the purchasing power of the world; and I say the purchasing power is not there at present.
– America is doing trade on long credits, so why cannot we do the same with our wool?
– The honorable senator should consider the circumstances. The United States of America id getting tremendous forestry, mining, and other concessions in those European countries. We must’ remember, also, that the United Statesof America has a population . of 113,000,000, and is in a position to lend. She claims even England as her debtor. Australia is in a vastly different position. Australia is not anxious to give credits. As a matter of fact, she is going around the world asking for money for the products she has to sell It is idle to put us in the same position as America. In conclusion, I have to . thank honorable senators for the manner in which the debate has been conducted.
Question resolved in the affirmative.
Appointments ofex-Members of Inter-State Commission.
asked the Minister representing the Prime Minister, upon notice -
Regarding the members of the Inter-State ‘ Commission whose tenures of office terminated on 10th August, 1920 -
Have any and who, of such members since that date, been appointed to or held any other office or appointment under the Commonwealth Government?
In respect of each such member the(a)description of title of such other office or appointment; (b) date of appointment thereto) (c) duration of appointment; (d) authority for such appointment; (e) remuneration ?
– The answers are -
It may be mentioned that Mr. Mills holds the position of Comptroller-General, Department of Trade andCustoms, but was appointed an ‘ acting member of the Inter-State Commission, and is now being utilised by the Government in connexion with the Royal Commission on taxation.
asked the Minister representing the Minister for Trade and Customs, . upon notice -
Will the Minister state the total respective amounts paid toG. and C. Hoskins Limited and Messrs. Lysaght Bros, and Co. Ltd. by way of bounties in connexion with the iron andsteel industries within the Commonwealth?
– The, amounts are respectively- G. andC. Hoskins Limited; ?206,320 ; Messrs. Lysaght Bros, andCo. Ltd., ?23,086.
Restriction of Output
asked the Minister representing the Minister for Trade and Customs, upon notice -
– The answers are -
Value of AnnualProduction.
asked the Minister representing the Minister for Trade and Customs, upon notice -
What is the value of the annual production of agricultural implements and other machinery from 1909 to 1919?
– The respective values are -
Number of Students
asked the Minister for Defence, upon notice -
– The answers are -
Senate adjourned at 10.27 p.m.
Cite as: Australia, Senate, Debates, 4 May 1921, viewed 22 October 2017, <http://historichansard.net/senate/1921/19210504_senate_8_95/>.