13th Parliament · 1st Session
The President (Senator theHon.P. J. Lynch) took the chair at 11 a.m., and road prayers.
Investment in Australia.
– I ask the Vice-President of the Executive Council have any overtures for relief from taxation, temporary or otherwise, been made by the ‘Government of South Australia with reference to the development of the south-eastern portion of that State by British capital? Also, if any inducement is offered to British capital along the line’s suggested in the newspaper statements relating to the overtures mentioned, will the Government give similar treatment to British capital interested in the development of the gold-mining industry in Western Australia?
– As an answer to the honorable senator’s questions would involve a statement of government policy, which it is not customary to make in reply to questions, I am unable to give him any information on the subject.
– I ask the Leader of the Senate if the Lord Mayor of Sydney has made arequest to the Federal Go vernment for the free supply of blankets, underclothing, and boots and shoes for the unemployed men and women of Sydney and their children, and, if so, what was the reply of the Government to the request ?
—I have no knowledge of such a request having been made to the Government.
asked the Minister for Defence, upon notice -
Senator Sir GEORGE PEARCE.The answers to the honorable senator’s questions’ are as follow : -
Loan Moneys and Bank Charges
asked the Minister representing the Prime Minister, upon notice -
Will the Government give consideration to the question of fixing the general rates of loan moneys andbank advances to rural and manufacturing industries at not more than 4 per cent. - this to apply to the Commonwealth and other Australian banks, also to British and foreign banks trading in Australia?
– It is not customary to make statements of policy in reply to questions.
asked the Minister representing the Minister for the Interior, upon notice -
In view of the Government’s proposal to build a new Commonwealth Bank in Hobart, and of the present position of the unemployed stonemasons of Tasmania, willthe Government take into consideration the building of a Tasmanian stone front to the bank instead of a cement front?
– The Minister for the Interior has furnished the following reply: -
The Commonwealth Bank authorities have already decided that the front of this building will beTasmanian stone.
Debt to United States of America
asked the Minister representing the Treasurer, upon notice -
– The Treasurer has supplied the following answers: -
In committee: Consideration resumed from 28 th June, 1933 (vide page 2687).
Group 3. - Revenue items not included under any other heading.
Division 16. - Miscellaneous
Item 367 -
Articles of an advertising character which would not otherwise be dutiable at a higher rate of duty under any other heading, including all articles which would be free but for their advertising characteristics, ad valorem - British, 45 per cent., general,65 per cent.
Upon which Senator Payne had moved -
That the House of Representatives be requested to make the duty, ad valorem - British, 25 per cent.
– I have made some further inquiries overnight with regard to this item. As I explained yesterday, this is a purely revenue duty. The item has application only to goods which are made of other material than paper, and are used for advertising though not necessarily imported for free distribution. It applies only to goods which, but for their advertising characteristics, wouldbe duty free, or rated not higher than item 367. It does not apply to any article which simply bears an importer’s name and address, but the word “ importer “ or “ importers “ appearing on an article, in conjunction with the name of a person for whom it is imported, would render the article dutiable under this item. In its instructions to collectors, the department advises that they must be guided by the probabilities in each instance, and it gives a number of examples of articles, the advertising characteristics of which are undoubted. Articles such as pocket-knives, lead-pencils, tools, tape measures, watches, &c, worded, “ With the compliments of . . . “ or bearing the name of an Australian firm or concern, except when imported by or on behalf of a firm or concern which sells the articles named in the ordinary course of business, would be dutiable. Such lines would include articles bearing the name of a commodity such as “Brook Whisky,” “Blink’s Soap,” or the brand of other articles on the Australian market with, or without the name of the firm. The duty does not apply to any article which simply bears the importer’s name or address, but when the word “ importer “ appears on it in conjunction with the name of the person or firm for whom it is imported, the article becomes liable to duty. For example, if an article has printed on it the words “ Thomas Brown and Sons, Melbourne “, it will not be dutiable, but if it bears the words “ Thomas Brown and Sons, Importers, Melbourne,” obviously it will be liable for duty. As, since the depression, these articles are not being imported to any great extent, and as I do not wish the time of the committee to be taken up in a lengthy discussion of this item, I am prepared to accept the requested amendment if honorable senators consider that the duty should be lower.
– I fail to see any justification for this heavy increase of the duty on this item, unless it can be shown that something is being clone to the prejudice of the revenue. Why should we penalize an importer who, in his desire to increase the sale of a certain article in Australia, arranges with the manufacturer to have printed on it words indicating that it has been especially imported by him?
Request agreed to.
Item agreed to, subject to a request.
Item 369 agreed to.
Item 408, sub-item (a) -
Outside packages, n.e.i., and outer coverings, including the sole containing package, in which goods are ordinarily imported, when containing such goods -
. -Under the 1921-30 tariff, articles covered by this item were free, and as these outer coverings are of no commercial value, this duty imposes an undue penalty on importers. Take, for example, the case of an importer of drapery. His consignment of goods may be in a dozen cases which, in all probability, would be invoiced in London at anything from 15s. to 25s., whereas their commercial value in Australia may ‘be anything from1s. to 3s. each. Why should the importer be penalized by being required to pay an ad valorem duty of 20 per cent. British and 30 per cent. general tariff on cases? The Government may be keen about getting additional revenue from this source, but it ought to realize that as it is impossible for the importer to get any return from the sale of these cases, he will be obliged to pass on to the purchaser of the materials the added cost due to this duty.
– There is good timber in most of the cases.
– That may be so; but when a case which costs from 15s. to 25s. has to be sold for1s 6d. or 2s.6d., it is a poor proposition.
– My experience is that it is not possible to buy these cases.
– Of course it is. The storekeeper must get rid of them, otherwise they would lumber up his premises. To have to pay a duty of 5s. on an article which costs anything up to 25s. and must be sold for 2s. 6d. or thereabouts, is outrageous. I, therefore, move -
That the House of Representatives be requested to make the duty, ad valorem, British, 10 per cent.
– This item is important from the revenue aspect. The duty was imposed by the previous Government for revenue purposes, and is being continued for that reason by the present Government. The value of our importations under this item was £1,794,965, in 1930-31, and £1,213,562 in 1931-32, in which year the amount of duty collected was’ £95,202. These packages are invoiced separately from the goods they contain. I ask honorable senators not to agree to the request, first, because it would entail a loss of revenue ; and, secondly, because the Australian manufacturers, if they wanted to use similar packages, would have to pay duty upon them, and so would be at a disadvantage compared with their overseas competitors.
– I can understand the desire of the
Government to obtain as much revenue as possible through the Customs Department; but the very fact that our importations under this item are so extensive is a justification for my request for a reduced duty. The present impost is unnecessary and unfair. If the importers were able to sell these packages at anything like their cost it would not be so bad, but as they have to dispose of them for one-tenth of their cost, it is not right to inflict such a heavy duty upon them. Goods which are imported into this country must be protected by packages of timber, canvas or some other material. The cost of such packages is based on the cost of the material in them in the country of origin; but when the packages reach Australia, and the goods are taken out of them, they become practically useless for general purposes. If they are of timber, the lengths are not long enough to make them of much value. If a person goes into a drapery establishment and inquires the price of a packing case of, say, 3 ft. x 2 ft. 6 in. x 4 ft., he willprobably be told anything from 3s. to 5s.
– Such packingcases cannot be had at any price in Brisbane.
– I do not know what they do with them in Brisbane. I am speaking of something I know a good deal about. These packages have no real commercial value, and it is unjust to subject them to such a high duty.
Question - -That the request (Senator Paynes) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 4
Question so resolved in the negative.
Sub-item agreed to.
Pipes, smoking, n.e.i., cigar and cigarette tubes holders and cases, tobacco and snuff boxes, n.e.i., and accessories; smoking requisites, including cases, tobacco pouches, smokers’ sets, match stands, ash trays, smokers’ lamps, cigar stands and lighters, ad valorem, British, 35 per cent.; general, 55 per cent.
– I understand that no Tariff Board reports have been received on this item except in relation to tobacco pouches. The present rate of duty is ad valorem, British, 35 per cent.; general, 55 per cent. The rates under the 1921-30 tariff were, British, 25 per cent. ; intermediate, 35 per cent.; and general, 45 per cent. To-day the impost on these goods, taking exchange into account, is about 70 per cent. British, and 90 per cent. foreign. Our imports under this heading declined by about one-half from 1930-31 to 1931-32, and that is the natural result of excessive duties. A reduction of the duty on this item by 10 per cent. would not seriously affect the revenue. A good deal was said in our debate last night about the inconvenience and expense that the poorer sections of the community are being called upon to bear at present. I suggest that in these hard times it is not fair to ask people who want to buy an imported pipe to pay a duty of 70 per cent, on it simply to protect the few manufacturers who are engaged in the manufacture of pipes in Australia. If the local manufacturers cannot more nearly approach the overseas price of pipes they should discontinue their operations. I think that the duties should revert to the 1921-30 figures, and I therefore, move -
That the House of Representatives be requested to make the duty’, ad valorem, British, 25 per cent.
– Many experiments in pipe manufacture are being made at present by the QueenslandForestryBureau,andI have been informed that pipes of an excellent quality are being produced by Queensland makers.
– Does the honorable senator smoke one of them?
SenatorBROWN.-Ihavenotsmoked for the last thirteen years, but I have received a number of sample pipes from the Queensland Forestry Bureau, which I have handed to friends of mine who smoke, asking for a report upon their quality. Several honorable senators who have used these pipes have spoken highly of them. I am opposed to the request, because I believe that before very long the locallymade pipes will be able to successfully compete in Australia with foreign-made pipes. To reduce the present duty would be detrimental to the Queensland product.
– I support the remarks of Senator Brown, who has shown why the British preferential duty on smoking pipes should not be reduced. I have seen samples of pipes manufactured in Queensland, and know that the industry is worthy of the protection- which it now enjoys. If the Queensland manufacturers sent samples of their product for the inspection of honorable senators it would be found that the quality is good, and that the present duty is justified. Root woods from which excellent pipes can be manufactured are available in sufficient quantities in Australia. French briar pipes are used extensively, but this is an occasion when Australians can display a little Australian sentiment, and support the products of their own country. Cherry and other suitable woods are obtainable in satisfactory quantities in Australia, and should be used for pipemaking. Senator Duncan-Hughes represents a State which produces only mallee roots, which are unsuitable for pipemaking.
– Mallee root wood can be used for pipe-making.
– If that is so, South Australia, as well as Queensland and Tasmania, can engage in this industry.
Apparently some honorable senators are ashamed to smoke Australian pipes.
– We are not ashamed ; it is a matter of taste.
– As a non-smoker, I cannot determine that point. If facilities are provided for treating the wood, pipes of good quality can be manufactured in Australia to supply the local demand. To afford sufficient protection to this industry, and to allow the Australian manufacturers to bring their product more prominently before the public, I intend to oppose the request.
– This item has been the subject of inquiry by the Tariff Board, which reported that the increased duties were not necessary for protective purposes. They are entirely revenue duties, and the poor man’s pipes, such as clay pipes, are included in another item. The revenue collected under this item last year amounted to £9,924, which the Government cannot afford to lose.
– What were the duties under the previous tariff?
– British 25 per cent., intermediate 35 per cent., and general 45 per cent., and under this schedule the rates have been increased to British 35 per cent., and general 55 per cent. These duties were increased by the previous Government for revenue purposes, and have been maintained by the present Government with the same object.
– The Minister (Senator McLachlan) has admitted that these duties have been in operation for three years without ratification by the Parliament. It is now contended that because the duties have brought in additional revenue, they should be retained solely for revenue purposes. The Tariff Board reported against higher duties for protective purposes. The Government ignores the fact that in addition to this heavy impost there is a 10 per cent.primageduty.Thereisno justification for an increase upon which Parliament has not, until now, had an opportunity of expressing an opinion. An attempt is now being made to bring the British preferential duty back to a reasonable level which would still provide sufficient revenue. If the Government proposes to act in this way, it might as well adopt the whole Scullin tariff in order to provide revenue. I am disappointed with the information supplied by the Minister, and intend to support the request moved by Senator DuncanHughes.
– The Tariff Board’s report has not been tabled.
– No, but I accept the statement of the Minister that additional duty is not needed for protective purposes.
[11.38]. - I should like to say a word or two on this item from a revenue viewpoint, which, of course, directly affects the Treasury. These additional duties, of which there are quite a number, have been imposed for revenue purposes. In future, it may be possible for the Government to consider this form of taxation, and to afford some relief; but it is essential that when relief comes to be given, to whatever extent may be possible, it shall be given in whatever man ner may be the most beneficial to the Australian people as a whole. The Government considers that there may be certain ways in which to afford relief generally, but if the committee reduces these revenue duties in the way that some desire, we shall be prevented from giving relief in a more general way. That is an important aspect of this subject which must not be overlooked, I cannot give any promise or indication of what the Government proposes to place before Parliament in the budget; but if the committee reduces revenue duties, the Government will be prevented from. giving relief in other directions. This item in itself is not important, but £100,000 of revenue was involved in connexion with an item upon which the committee recently voted. It is the cumulative effect’ of reductions of duties that. has to be considered. Already the committee has agreed to a reduction of duty which means a slight loss of revenue and another is now being considered. It would be quite easy thus to reduce the customs revenue by £2,000,000, but to do so would have a serious effect on our finances, and I ask honorable senators to consider these duties from that view-point.
– I do not want it to be thought that I am opposed to the Government receiving a reasonable amount of customs revenue. I do not object to the imposition of duties on important items, but in this case, duties which are already high are to be increased because revenue is needed. I object to further impositions on goods that are already heavily taxed, in order to obtain additional revenue.
– I support the request moved by Senator Duncan-Hughes. Heavy duties have already been imposed upon tobacco, and cigarettes, and we are now asked to support, an additional impost upon smokers. Smoking pipes, which are included in the same item as cigars, cigarettes, tube holders, and other smokers’ requisites, should be in a separate item. Heavy customs and excise duties are paid on tobacco, and we now find that 50 per cent, of the cost of pipes is represented by the duty. To that impost must be added exchange.
– By how much would the cost of a pipe be reduced if the request were agreed to? I think it would be a fraction of one halfpenny.
– The- amount may be small, but a principle is involved. The total importation of pipes in 1931-32 was valued at £14,216, on which duty amounting to £7,722 was paid. The Assistant Treasurer (Senator Greene) said that this and other revenue duties should be considered from the view-point of Commonwealth finance, but I believe that the Government would obtain more revenue if duties were reduced. Most of the pipes used in Australia are of French manufacture, on which a duty of 55 per cent, is paid. I have tried Australian-made pipes, and have found them too heavy, and not so satisfactory to the smoker as the imported article.
– Most of the pipe-smokers in Australia buy pipes at 2s. or 2s. 6d. each, on which the duty comes to about Id. We are wasting more money in prolonging this debate than would be saved by the proposed reduction of the duty. Senator Brown has told us that an industry has been started in Queensland for the manufacture of pipes which will probably be better than those imported. In my opinion, there is no re’ason for interfering with the present duties.
– I am not now a pipe-smoker, although I smoke cigars and cigarettes; but I know that pipes are at present being manufactured in Queensland, and there is no reason why, with our wide diversity of climate and soils, we should not be able to produce wood suitable for making pipes of high quality. “
– Did the honorable senator always use Australian-made pipes?
– I have bought only half a dozen pipes in my life; pipesmoking does not suit me. I know that pipes of excellent quality have been made in Queensland, and probably can be made in other parte of Australia, also. If the industry is fostered, there is no reason why we should not go on making good pipes in which to smoke our good Aus-, tralian tobacco. No doubt there is something in the argument that heavy taxation has to be paid by smokers on the tobacco they use, and that we should, therefore, not make pipes unnecessarily dear; but the duty payable on a 2s. pipe would not be more than 2½d. This item has been proposed by two governments, and there is no reason for interfering with it. It is an alarming thing that we should sit here, as Australians, and confess that satisfactory pipes cannot be made in this country.
– The manufacturers already have all the protection they want; this is a revenue duty.
– I am concerned with fostering the local industry. The revenue obtained is so small as not really to matter.
– If this discussion has done nothing else, it has convinced most honorable senators that we may become a little too finicky in dealing with the tariff. Senator Greene has pointed out what the proposed reduction would mean, and when we realize, as was1” pointed out -by (Senator
Badman, that the majority of the imported pipes do not come from Great Britain, it is evident that the proposed 10 per cent, reduction of duty will not affect to any great extent the expenditure of pipe-smokers, and we are wasting the time of the committee in discussing something which, to the average pipe-smoker, would make a difference of not more than 2d. a year.
– On cheap pipes.
– The man who is fortunate enough to be in a position to buy dear pipes can afford to pay the higher duty. Pipes are not the only things in this item, which includes snuff boxes, among- other things. If there is any demand for snuff boxes in Australia, it is supplied, I should think, by Japan or Germany. Tobacco pouches, which are also included in the item, are mostly made in Australia,* and the demand for imported pouches comes only from those who wish to buy expensive pouches as presents. Other articles covered by the item are match stands and ash trays, but how often does the average person buy these things? Probably Senator Badman bought one when he was married twenty years ago, and has bought none since. Nor is the demand for smokers’ lamps any greater. I bought one ten years ago, and have not had occasion to buy another. In any case, most of those sold in Australia are made in America. Senator Duncan-Hughes had an excellent opportunity last night, when the duty on films was being considered, of doing something to provide the workers with cheap entertainment, and that was a much more important mattter than the duty on pipes can ever be. I appeal to honorable senators to let us get on to items that really mattter.
– I should like to make it clear that, although this is not in itself a very important item, it is one of the specimen items upon which requests may appropriately be moved. A vote cannot be taken on every item in the schedule, but there are some items which can be picked out as being important, which affect all sections of the community, especially the consumers. My proposal is for a small reduction of the
British preferential duty: that the duty should be reduced to the 1921-30 level. That is a most moderate request, having regard to the high exchange rate. It is quite true that most of the articles covered in this item are not imported from Great Britain. Last year, according to the Trade Bulletin, £14,000 worth of - pipes were imported, and £18,000 worth of the other articles covered by the item. Of those, about £10,000 worth came from Great Britain, and I suggest that the British preferential rate should be reduced by 10 per cent. Of course, my voting on other matters may be dragged in by way of prejudice, but my vote as to films stands on record, and I am not ashamed of it. I appreciate what Senator Greene said about the need for safeguarding the revenue, but there is no indication that, if this small reduction of duty were made, there would be any decline in the revenue. I press my request, and hope that the committee will agree to it.
Question - That the request (Senator Duncan-Hughes’) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . 9
Question so resolved in the negative.
Item agreed to.
Item 434 agreed to.
Motion (by Senator McLachlan) agreed to -
That the consideration of the remaining items other than those included in group 4 of the Customs Tariff Groups Memorandum be postponed until after the consideration of the items specified in group 4.
Group 4. - Items amended by Scullin Government and supported by Tariff Board reports.
– I wish to draw the attention of honorable senators to item 338 a, in which occurs a printing error. The memorandum refers to “ paper and board printed and prepared “, while the bill refers to “ paper and board printed or prepared”.Thewordinginthebillis correct, and I ask honorable senators to make the necessary alteration in the memorandum.
Division 1. - Ales, Spirits and Beverages
Item 9 (a) to (e) agreed to.
Item 11 (b) (Flavoringessences,extracts, &c).
.- I should like the Minister to explain why the rates of duty under this item have been increased?
– The proposed rates under this sub-item are the same as those introduced by the Scullin Government, with the exception of an increase of 5 per cent.intheadvaloremgeneraltariffrate to conform with the Ottawa agreement. They are, , however, considerably higher than the rates obtaining under the 1921-30 tariff, namely, 20 per cent. British preferential, and 30 per cent, general. The. Tariff Board recently inquired into the question of the duties on essences, &c., including the goods covered by this sub-item, and recommended the retention of the duties introduced by the previous administration. Owing to the difficulty being experienced in distinguishing between “ Extracts “ and “ Essences “, the board has suggested that special mention be made of extracts in item 11 b. Administrative difficulty will also be overcome by the inclusion in the sub-item under discussion of the types of flavouring and culinary essences previously classified under item 79. This departure is alsosuggestedbytheTariff Board. Evidence tendered at the board’s inquiry related mainly to spirituous essences. The demand for non-spirituous essences does not bulk largely in comparison. It was found, however, that much higher rates than those under the 1921-39 tariff were necessary for the adequate protection of essence manufacturers. A point also made by the board, and one worthy of mention, is that the industry would be thrown out of balance if the disparity between spirituous and non-spirituous essences were too great, and that it would be found that users of essences would import the product in non-spirituous form and escape the higher duties payable on spirituous essences.
Sub-item agreed to.
Division 4. - Agricultural Products and Groceries
Items 44 (c2), 53 (c), 54 (a1 to 6), 74(c), 78(G),82 (a to f), 85 (a) (b), and 104 (b) agreed to.
Division 5. - Textiles, Felts and Furs, and ManufacturesThereof, and Attire.
Item 110, sub-items (a1 to 5) (b1 to 3)-
Apparel, other than knitted, viz.: -
Apparel, knitted, and apparel made from knitted or lock -stitched piece goods, viz. : -
– This item embraces practically every class of outside apparel worn by men, women and children in Australia. Some few years ago a new departure was introduced by the Parliament in fixing a fairly heavy flat rate upon each sub-item. Taking the first sub-item - overcoats and suits, men’s - the rate fixed was 7s. 6d. British, and12s. 6d. general, plus an ad valorem rate of 30 per cent. British and 45 per cent. general. The Scullin Government, by resolution, increased the flat rate on the whole of the sub-items by 100 per cent.
– The duties were doubled.
– That is so. Naturally, I was suspicious whether any investigation had been made at all to warrant such an extraordinary imposition, and I contended at the time that the department had had really no opportunity in the period of two or three weeks at its disposal, to deal with such an extensive variety of sub-items. Therefore, I concluded that the Government simply doubled the rates.
– It took a number and doubled it.
– We have the extraordinary position that the action of the then Government was supported by the Tariff Board. I have read the report carefully, but, unfortunately, it does not contain the evidence which was taken by the board.
– What was the date of the report?
– The 5th October, 1932. We can only assume that the recommendations of the Tariff Board were based on the evidence given before it. What that evidence was I cannot say, but I am forced to the conclusion that the recommendation of the Tariff Board is not warranted, and I am not prepared to accept it. The report reads -
The board realizes that the duties now in operation, excluding the surcharge, are in many instances excessively high, particularly with regard to some of the cheaper lines of outer wear and knitted underwear. In exceptionally cheap lines of athletic singlets, for instance, the fixed rate duty, plus the ad valorem duty, represents a total ad valorem equivalent of approximately 1,000 per cent. However, the board has chosen, for purposes of comparison, garments fairly typical of the bulk of the trade, and these indicate that the ad valorem equivalent of the existing proposed duties under the British preferential tariff ranges from 60 per cent. to 100 per cent. The board is disturbed by the fact that such important garments as men’s suits and overcoats should, in many instances, require such high duties in addition to the natural protection afforded by exchange, &c., in order that the Australian article should have a reasonable chance of competing withthe imported. At the same time the evidence indicates that the excess cost of local manufacture is largely constituted by the excess cost of materials in
Australia. For instance, the materials in the men’s overcoats and suits and the boys’ suits, in the illustrations given in the preceding table, cost more in Australia than the f.o.b. price of the comparable garment in completed form in the United Kingdom.
I am not prepared to accept the accuracy of the table referred to in that statement. I have a thorough knowledge of the trade, and from my observations within the last few weeks I must conclude that, for purposes of comparison, the table is not worth the paper upon which it is printed. I am not suggesting that it has been compiled in order to mislead the Parliament or the general public, because it may have been prepared on the evidence tendered to the board.
SenatorReid. - Was not the evidence taken on oath?
– Yes. I am confident that if this table were analysed by any one who has a knowledge of the ramifications of the trade and the prices charged in the retail dry goods stores in Australia, he must conclude that it is inaccurate. It may be in accordance with the evidence, and the evidence, taken on oath, may have been correct to a certain extent, but I can understand a witness answering leading qustions, putting only one side of the case, and refraining from giving other evidence, which would place a different construction on the whole matter.
– He might tell the truth but not the whole truth.
– A witness is not compelled to tender evidence for which he is not asked, and he may keep in the background information which is vital if the board is to come to a proper conclusion. Can any one justify such an imposition ? Practically the whole of the Australian market for these goods is held by Australian manufacturers.
– Would the honorable senator say that 25s. is a fair price for an overcoat?
– This table gives the manufacturer’s wholesale selling price as £1 17s. 8d., although similar goods are quoted at 18s. f.o.b. United Kingdom ports. Overcoats are sold at various prices. A well-made and attractivelooking Australian overcoat of good quality tweed can be obtained for 30s. - a price which returns a fair profit to both the manufacturer and the retailer. There are some informative tables in the Tariff Board’s report. They show the excellent value of the goods turned out by Australian woollen mills - goods which form the raw material for these garments. The report shows that these goods can be produced cheaply in Australia. The statement that the material for these goods cannot be made in Australia for the price at which the completed article can be imported from the United Kingdom is not in accord with fact, although, perhaps, it agrees with the evidence tendered to the Tariff Board. Sub-item 110 a1, 2 deals with men’s and boys’ clothes ; the remaining sub-items refer to women’s apparel. Cotton blouses or skirts imported from Great Britain are subject to a duty of 2s. each and 30 per cent. ad valorem, notwithstanding that their invoice price may be only1s. 3d. or1s. 6d. in the Old Country. Should the blouse or skirt be of wool, or contain wool, the duty is 7s. each and 30 per cent. ad valorem. An attractive looking blouse containing wool costs from 2s. l1d. to 3s. 6d. f.o.b. United Kingdom ports, yet the duty is 7s. each and 30 per cent. ad valorem. That the old duty of 3s. 6d. each and 30 per cent. ad valorem was more than sufficient to protect Australian manufacturers is shown by the growth of the Australian apparel-manufacturing industry.
SenatorCRAWFORD.-Why not leave well alone?
– I desire to retain the duties under which this industry went ahead by leaps and bounds. If it could be shown that a reduction of the duty would imperil the industry, I would consider the granting of further protection ; but the industry developed wonderfully under the 1921-30 tariff.
SenatorRae. - Have these duties been operative since October last?
– They were imposed during the regime of the Scullin Government, and have been in operation ever since then. I am not, however, referring only to the increased activity in this industry during the last year or two. Under the old schedule, which provided for a flat rate of duty, as well as an ad valorem duty, the industry was able to go ahead rapidly, so that there is no need for any higher duties than then existed. I am not prepared to accept the suggestion of a section of the press that Australia needs an anti-English tariff. The schedule before us is decidedly anti-English; it offers no encouragement whatever to manufacturers in the Old Country. In its annual report the Tariff Board referred to the danger of removing all competition from Australian industries. There must be competition if our local industries are to improve and keep up to date. The report stresses the necessity for a reduction of prices to consumers.
– The prices of these goods are being reduced every day.
– Overcoats and men’s clothing generally, as well as many articles of women’s clothing, are turned out by Australian manufacturers at reasonable rates. We do not want to antagonize British manufacturers by imposing additional and unnecessary duties on their goods. I move -
That the House of Representatives be requested to make the duties, sub-item (a la) each, British, 7s. 6d.; general, 12s. 6d.
.- Since the Scullin duties were imposed without any examination by the Tariff Board, I can understand the object of the honorable senator who has moved the request. A further impost’ of 50 per cent., ad valorem, was imposed, but it was removed subsequently. That additional duty was evidently put on for revenue purposes alone. The textile industry in Australia has grown to considerable dimensions, and it now provides employment for large numbers of Australians. This is a secondary industry, which has been able to develop an export trade worth over £50,000 a year.
– Our export trade to New Zealand has existed for ten years.
– On the 30th April, 1932, the then Minister for Trade and Customs (Sir Henry Gullett) referred these duties to the Tariff Board for investigation and report. The board furnished the report to which Senator Payne has taken exception. The board was asked to say whether the duties on textiles conformed to the principles underlying the Ottawa agreement, and it re ported that they did not. Consequently, the matter was again referred to the Tariff Board on the 22nd February, 1933. On page 8 of the board’s report, there is a table showing that’ in the knitting factories, dressmaking and millinery establishments, and factories in which shirts, ties, scarves, underclothing and other goods are manufactured in Australia, 61,913 persons were employed in 1929-30. Those figures indicate how serious any disturbance of this industry would be. Accordingly, the Government felt that there should be a further examination of these duties in the light of the Ottawa agreement before action could be taken, particularly as the Tariff Board’s report supported the Scullin duties. The following extract is taken from page 9 of the Tariff Board’s report: -
Moreover, the board realizes that although the selection made may be accepted as fairly representative, many instances might be found where the overseas competition might be much stronger than in the cases cited. Further, in certain types of apparel, a garment made in the United Kingdom or on the continent could be sold against a comparable locallymanufactured garment, although prices might be slightly in favour of the latter. In addition, there unquestionably exists in certain lines the danger of large imports from overseas of end-of-season stocks at greatly reduced prices.
Since the end of the European winter coincides with the beginning of winter in Australia, there is grave danger of any carry-over of goods on the other side of the world being landed in Australia at prices much below those which prevailed early in the European season, although not below end-of-season prices. In those circumstances, the provisions of the Industries Preservation Act cannot be brought into operation, and, consequently, Australian manufacturers of these goods have to face unfair competition. Running through the board’s report there is evidence of its appreciation of that danger. Again on page 9 the board stated -
In the opinion of the board, regulation of the costs of apparel by a finely adjusted table of duties affording local manufacturers only slight advantages over importers is impossible, because of the almost unlimited range of garments in demand, in sizes, design, material, and colour. The fact that the clothing trade, especially in women’s garments, is largely ruled by fashion, and the fact that there is a danger of end-of-season stocks abroad being drastically marked down and shipped to Australia, tend to upset the most carefully planned duties.
The report further stated -
The board is disturbed by the fact that such important garments as men’s suits and overcoats should, in many instances, require such high duties in addition to the natural protection afforded by exchange, &c., in order that the Australian article should have a reasonable chance of competing with the imported. At the same time, the evidence indicates that the excess cost of local manufacture is largely constituted by the excess cost of materials in Australia. For instance, the materials in the’ men’s overcoats and suits, and the boys’ suits, in the illustrations given in the preceding table, cost more in Australia than the f.o.b. price of the comparable garment in completed form in the United Kingdom.
– That is not borne out by a table prepared by the board, and embodied in another report.
– I have read the solemn pronouncement of the board, after it had heard statements made on oath by witnesses on both sides.
– What is the date of that report?
– October, 1932. It is the considered opinion of a body of experts.
– The Australian textile manufacturers have been selling their goods at very low prices recently.
– I have already stated that they are exporting goods. The board went on to say -
The board does not accept these differences in cost as inevitable, and is convinced that they must be reduced. The board has already recommended reductions in duty in respect of yarns, woollen piece goods, cotton tweeds, and certain knitted piece goods. The duties recommended in each instance would be adequate to protect efficient local undertakings, and should secure reasonable selling prices in the trades concerned. The chief bearing that the adoption of the board’s recommendations in these instances would have on the apparel industry would be that -
The manufacture of yarns and piece goods in Australia would be restricted to those lines offering scope for economic production;
The price of the Australian-made yarns and piece goods would be limited ;
Those yarns and piece goods not made in Australia would be obtainable at lower cost than at present.
If these results should eventuate, Australian clothing manufactures should be enabled to produce at lower costs, and should be able to offer garments to the public at lower prices than those obtaining at present.
The foregoing paragraphs have dealt with instances where the Australian wholesale price exceeds, in some cases seriously, the cost of landing free of duty a comparable article from overseas. However, it is pleasing to note that in many instances the reverse is the case, and the Australian garments arc being sold at prices which compare favorably with those of the imported garments on a duty-free basis. This is particularly the case with the knitted apparel, but in certain instances illustrations were given where ladies’ coats and blouses, and skirts of Australian production were on a reasonable level with the duty-free prices of comparable imported lines.
The report shows the importance of the industry, and the board is of opinion tha t the cost of the material required by it is higher in Australia than it ought to be. The board has taken steps that will bring about price equalization in regard to that material, for it considers that the industry is in danger of unfair competition from end-of-season goods which come in at particularly low prices. Those considerations, apparently, influenced the board, because throughout its report is displayed a desire to assist local production on economic lines. That must commend itself to honorable “senators. In view of these circumstances, and having regard to the fact that effect will be given to other recommendations of the board as they come along, I ask honorable senators to wait until the board has spoken again before it attempts to deal with an industry of such magnitude and importance.
– The honorable senator has exhausted his time.
– The clothing industry covers many activities, and provides employment for a large number of persons. It is one of the most important industries in the Commonwealth, and is a large user of Australian raw materials, particularly woollen and cotton textiles. Provision has been made for an increase of the duties in respect of goods which formthe raw material of the apparel industry, such as cotton and wool yarns, cotton tweeds, woollen piece goods and silk and art silk piece goods. Fiscal protection to one side of the textile industry, unless carried co-ordinately through every section, is of very little use, and in the case of apparel it is particularly necessary to safeguard the industry against overseas end-of -season clearance lines. In the past British firms were able to enter the continental markets, and buy large parcels at jobbed or clearance prices. Much of this material eventually found its way to Australia, and entered at British preferential rates, as there was nothing to indicate its origin.’ Such goods may have come from Japan or from any other market in which textiles are produced by cheap, coloured labour. British buyers were able to obtain this material at low prices, and to dump it on the Australian market. It has invariably been found impossible to prove dumping, and apparel manufacturers have in the past suffered in consequence. The only means of combating competition of this kind is to make the protection effective.
Under the Pratten tariff of 1926, the rates of duty in the clothing industry were increased, with a view to securing the market to Australia. That the protection then afforded was inadequate, however, is proved by the fact that the value of importations over the three years from 1927-28 to 1929-30 was reduced by only £288,000. The present rates of duty were first imposed during the Scullin Government’s regime by resolution of the 21st November, 1929, and the effect of this increased protection has been to reduce imports to reasonable dimensions. Regarding the dimensions of the industry, Production Bulletin No. 25 gives, in relation to the clothing industry for year 1930-31, the following information: -
Sitting suspended from 12.45 to 2.15 p.m.
– The importance of these items is shown by the figures that I have quoted. The Pratten tariff resulted in the imports of this class of merchandise being reduced to the extent of only £800,000, which is a mere drop in the bucket ; consequently, it was necessary to refer the matter to the Tariff Board. That body made an exhaustive investigation of it, and upon its recommendations the present rates were fixed, the items being practically the same today as they were under the Scullin tariff. Therefore, nothing further need be said, particularly by those who pin their faith to Tariff Board inquiries. Generally speaking, the confidence held in the work of the hoard is justified.’ Apparently, however, those who desire to amend the schedule would do so regardless of the evidence placed before the board proving the importance of this” industry to Australia. Senator Guthrie is vitally interested in this matter, for the reason that he is a producer of the material used in the manufacture of most of the articles under discussion. Other honorable senators are, perhaps, similarly situated, though to a less extent. So there should be very little chance of the request being agreed to by the committee. To me, the well-being of the wool and cotton industries is of transcendent importance in the development of Australia. I hope that the day will soon come when we shall have spinning-mills manufacturing the raw material that is grown by gentlemen like Senator Guthrie, who spend so much of their time in improving the quality of their product. This is not a fantastic vision. It is only patriotic of any Australian who is aware of the potentialities of his country that he should desire it to be developed and populated, so that it may remain what it is to-day, the purest offshoot of the British Empire, and the outpost of the white race in the Pacific. The attitude adopted by some persons towards this question has always been an enigma to me. I am proud to wear clothing that is made in this country from the raw material that we produce. It is good enough for any person, and I would go to almost any lengths to ensure that others followed my example.
– I wish the honorable senator would wear woollen ties, instead of those imported from Japan.
– The tie that I am wearing is a good one, and has not been imported from Japan. I hope that I shall never be accused of wearing a
Japanese article when one made in Australia is procurable. I may occasionally, in ignorance, purchase what has not been made in this country. As a protection to buyers against deception, I would insist that everything sold was branded in such a way that no Australian could mistake where it was produced. I hope that the committee will reject the request. If it is adopted here, it will meet the fate that it deserves in the House of Representatives..
– I must support the appeal of the Leader of the Opposition. My dear friend, Senator Payne, devoted a lot of time to research work in connexion with the manufacture of cloths, while he was overseas with the Scottish delegation. He then visited Yorkshire, Lancashire, and other places, where he saw the mills at work. I would point out to him, however, that for years Germany has been considered the sweat-shop of Europe, and that German manufacturers adopt the practice of cutting cloth into the required lengths and sending it across to England to be turned into the finished article and distributed throughout the British Empire generally as the product of Great Britain. I have seen in South Africa a square covering an area of seven or eight acres, on which were hundreds of stalls that displayed for’ sale cheap, shoddy, goods from Germany, Japan and elsewhere. Only a few months ago, grave allegations were made in the press, especially in Melbourne, of intense sweating in the clothing trade. This is a matter that should be investigated, because young men and girls should not be expected to work under the conditions that are said to exist. I agree with Senator Barnes that Australian wool and cotton should be manufactured in this country. I would remind Senator Payne that the value of the plant and machinery used in the tailoring and ready-made clothing section of the industry is £1,465,924; that the salaries and wages paid amount to £2,058,597 ; that there are 4,192 males and 13,472 females employed; and that the total value of the output is £6,307,261. The value of the output in the dress-making trade is £2,748,765, and the wages paid total £804,286. The total number of persons employed in both those sections of the industry is 25,460. For thebenefit of Senator Payne, I quote the. first verse of The Song of the Shirt -
With fingers weary and worn,
With eyelids heavy and red,
A woman sat, in unwomanly rags,
Plying her needle and thread -
Stitch! stitch! stitch!
In poverty, hunger and dirt, And still with a voice of dolorous pitch
She sang the “Song of -the Shirt.”
My dear friend from Tasmania would like to have sweated goods brought into Australia from China, India, and Germany. For the edification of honorable senators, I shall quote my own paraphrase of Hood’s poem to suit the present occasion. It is as follows: - .
By Senator Dunn:
Stitch, stitch, stitch, from morn till night.
The widow laments her sorryplight
That senators such as Payne should rave For sweated goods and German-made. “ German-made “, the Tasmanian cries ;
His wailing reaches to the skies.
The Jap, the Coolie, and the. Chink
Have found a friend in Payne, they think .
Found a friend, Asia hopes,
To let their products through the ropes;
And kill the chance the tariff’s giving
To dinkum Aussies to earn a living.
I am sure that that version can be aptly applied to the opinions of Senator Payne.
.- I want first of. all to deal with the objection that the Minister has raised to my request. He directed the attention of honorable senators to the statement that was made in the report of the Tariff Board dated the 5th October, 1932, and has claimed that the highly protective incidence of the tariff has enabled Australian manufacturers to build up a trade in these articles with New Zealand. That trade was established long before the duties were imposed - incidentally, without the help of Parliament. I know who does the business with New Zealand, and its extent. I am also aware that this trade with New Zealand has increased during the last two years. That has been due, not to the imposition of, these exceptionally high duties imposed, in the first place, by the resolutions introduced by the Scullin Government; but to the ability of our factories before these high duties were imposed to extend their activities and to manufacture a far greater variety of apparel than, was possible previously.
The report, which I quoted in support of my request, was used by the Minister for just the opposite purpose. The figures that are given in the comparative tables’ cannot be taken as representative of the bulk of the trade that is done in Australia, and I shall submit a few figures to honorable senators to enable them to judge for themselves. It has been claimed that the f.o.b. cost of the finished article in Great Britain is equivalent to the cost of the raw material in Australia. The figures that are given in the Tariff Board report absolutely disprove that statement, and I hope that t shall be pardoned for referring to them, as they have a distinct bearing on the justice of my request. The addendum to the Tariff Board report of the 26th September, 1932, states -
At the same time the evidence indicates that the excess cost of local manufacture is largely caused by excess cost of material in Australia, For instance, the materials. in the men’s overcoats and suits in the illustrations given in’ the proceeding table cost more in Australia than is the f.o.b. price for the comparable garment in the complete form in the United Kingdom.
Then, in the board’s report of the 8th December of the same year there appears a table which gives the prices of worsted and twills in Great Britain and Australia, showing that we pay 10s. 3d. a yard for an Australian-made worsted, the equivalent of which would cost 7s. 6d. in Great Britain. As it takes about 3J yards of material to make a suit, that represents a charge of 33s. 3d. for the Australian material, as against 24s. 6d. for the British product. But the table also gives the Australian wholesale price of a suit’ made of worsted as £5 12s. 9d., for which the retail price would be £7 9s. How many persons could afford to pay that for a ready-made suit? I contend that those figures were given by interested parties, and that £3 10s. or £4 would be nearer the mark.
– Those figures were furnished by both the manufacturers and importers.
– They ate not indicative of the price which is paid by the general public. Why, a madetoorder suit of the same material could be bought for £4 4s., or a better quality article for up to £7 7s. The prices quoted in the report cannot be reconciled with the ordinary demand. .
– Does that justify the reduction of the duty?
– What I have quoted entirely disproves the contention that the cost of the raw material in Australia is greater than that of the finished article in Great Britain.
If my request is agreed to,. it will be necessary to apply it to the’ remainder of these sub-items, such as cotton linen for shirts and COttOn material for women’s skirts and dresses, to which these prohibitive duties will be applied, and which are necessary as the basic material from which our artisans make the finished product.
– Could we not separate the different items ?
– There would have to be a subdivision, and then a resubdivision before we could bring about an intelligent tariff. It is absurd, and entirely unfair, to group 100 different items of apparel under the one heading, and subject them to the same- high duty. I am glad to know that the Labour party is waking up to that fact, and shall quote from the Labor Daily of the 22nd of June a statement which, coming from such a source, is somewhat extraordinary. It reads -
But that the time to review our general policy towards tariffs’ has arrived there can be little doubt, and that modifications of this policy are called for we think will not be challenged. But such a review is essentially a matter for the’ movement at large. Ever since it entered politics Labour has been a high protection party, spoon-feeding manufacturers indiscriminately-
That is my objection. The article goes on - and bolstering industries on ex parte claims of their ability to become self-supporting. And it cannot be denied that under this sweeping policy “balloon” companies have made big profits, and exploded exploiters have had a heyday of robbery, while all the time the Australian breakfast table has soared above the heads of the people on the plea that work was being provided for fellow Australians.
Those are reasonable sentiments, and should have been expressed long ago by the Labour party.
– Are they being backed up by action?
– I do not know ; but I know as much as anybody else about our industries, and I arn pleased with the progress that has been made by them, particularly with textiles and general apparel, during the last ten or fifteen years. The values that are given to our people are excellent. At the same time, the Government has no right to impose a highly prohibitive duty under the guise of British preference, and the obvious result will be an increase instead of a decrease in the cost of living in Australia.
– The honorable senator has exhausted his time.
– If the proposed reduction of duties were to have any effect at all, it would be the displacing of workers in Australian factories in order to find employment for workers overseas. We cannot afford to risk such an occurrence. Nearly all the duties in this division provide work for women, and, having regard to the number of women and girls unemployed at the present time, we dare not do anything that will diminish the employment available to them. If the proposed alteration would not have that effect, it would be entirely futile. To make a gesture to the people of the United Kingdom which, in practice, will mean nothing, would be to perpetrate a fraud upon them, and I am surprised that Senator Payne should lend himself to a proposal so disingenuous. Either this reduction of duty will have no effect whatever, or it will react to the grave disadvantage of thousands of worthy Australian citizens. I shall lend no countenance to this move. We must maintain undiminished every Australian industry, and do what we can to provide more work for our citizens. Many goods now imported could be satisfactorily produced by Australians who to-day are unemployed.
– Does the honorable senator desire even higher duties?
– No ; but the Tariff Board has reported that, in view of all the circumstances, the duties proposed are necessary. I protest against the time of the committee being wasted with a proposal that can have no practical effect.
– Senator Payne desires to rob us of the opportunity to manufacture our raw wool into garments.
– Wool does not appear in this item.
– A considerable amount of wool is used in the making of overcoats.
– Senator Payne wants Australian wool to be used in manufacturing in England instead of in Australia.
– At one time England exported wool to Flanders and imported woollen goods manufactured by the Flemish people. That was in the industrial dark ages.
– It was in the days of Merry England.
– So-called Merry England was merry only when permitted to be so by the feudal lords. Senator Payne apparently desires that Australia shall remain in a state similar to that of England in the middle ages. The merino wools of Australia are the best on the market, and it would be farcical to send them to Great Britain or to Japan for manufacture, and to buy them back again in the form of apparel.
– A logical development of the honorable gentleman’s argument would be the prohibition of the export of wool.
– That would be foolish. We should encourage our manufacturers to fabricate as much of the wool as is needed for local requirements ; the balance we can export. There are many things, including heavy machinery and chemicals, which the United Kingdom can produce to greater advantage than we can, and we are on sound ground in importing them, but our own factories should be able to produce all our ordinary requirements of woollen goods. Although the mills of Queensland may not be equal to those at Geelong, they produce a first-class article. I have worn suits made from Queensland cloths and found them durable and satisfactory in every way. We should take pride in encouraging manufactures of all kinds throughout Australia. Senator Payne is a State protectionist; but I am not prepared to accept his tarradiddles about the manufactures of States other than Tasmania. . I understand that 25,000 persons are employed in the manufacture of woollens in the Commonwealth.
– The employees affected by this, item total 61,000.
– I was speaking only of the woollen industry. The committee should reject this request, and, certainly, if a similar proposal is made in regard to cotton goods, I shall resist it most strongly.
– Senator Payne’s speech justified the suggestion I made in regard to Senator Johnston, that it would have been preferable if, at the commencement of this schedule, the Imperialist proEnglish senators’ had been given an opportunity to group the items on which they wished to reduce the duties. Then, after a general debate on the principle involved, the attitude of the committee could have been determined without further waste of time. Ministerialists have stated that their customs tariff policy is based on the reports of the Tariff Board. That body has reported in favour of these duties.
– The reference of items to the Tariff Board does not mean that we must carry out all that body’s recommendations.
– In regard, to items affected by the Ottawa agreement we are, apparently, bound to obey the reports of the Tariff Board. In this instance, Senator Payne has proposed a reduction of ‘ duty in opposition to the recommendations of the board. In what way that will assist Australia it is difficult to understand. Does the honorable senator believe that a reduction of the duty will lead to greater trade relations with the Mother Country in regard t6 the importation of clothing?
-1- If this duty is not altered, a large number of Australian operatives will be thrown out of work, because of the effect of the illegal tariff imposed by the Scullin Government.
– Honorable senators on this side believe that the higher duties in this sub-item will prevent the flooding of the Australian market with clothing made under sweated-labour conditions in Japan, Germany, and other countries. Senator Dunn made this clear this morning, when he pointed out that clothing, made in the cheap-labour countries of Europe, was exported to Britain and, after undergoing some minor process of manufacture, was re-exported to Australia, and received the benefit of our preferential tariff with the Mother Country.
– He made that statement, but did not prove it.
– Senator Dunn is a. man of truth, and I take it he did not make that statement without having thoroughly investigated the position. It is well known that clothing, manufactured in Germany, is sent to England, and is then exported to Australia. The honorable senator may affect to believe that this is not being done, but we all know that it is a common’ practice, and we are determined to support any action that will put an end to what we regard as unfair competition. The reduction of the tariff on these items would result in a heavy increase in the importation of articles of apparel manufactured under the conditions which I have described. I understand that Senator Payne has been a draper. He belongs to that class of traders who always endeavour to buy in the cheapest market.
– Does not the honorable senator also do that?
– No. Whenever I go into a shop I ask for Australian-made articles, which I purchase in preference to cheap and shoddy goods made, in other countries which, sometimes, are offered to me. I believe that, in buying Australianmade goods, I am doing a service to myself, to my fellow workmen, and to this country. Thousands of good Australians adopt the same rule. They decline to buy in the cheapest market, because they realize the need to develop Australian industries. I happen to have some knowledge of the clothing trade, and I know that those associated with it cannot be absolved of the charge that they exploit Australian workers. There is intense competition between clothing manufacturers in every part of Australia, and I should be very sorry, indeed, to see it intensified. Before we open the door to outside competition we should take cognizance of the fact that the industrial conditions in other countries are entirely different from those obtaining in Australia. As the cost of living in Australia is considerably higher than elsewhere, if our manufacturers are to maintain their position in the local market, they must have adequate protection. Senator Payne referred to a certain article that appeared in the Labor Daily recently. There are people outside who contend that’ there was a good deal of truth in the statements published in that newspaper, but I submit that honorable senators on this side are not supporters of the manufacturers as a class. On other occasions, I have made it plain that we believe in adequate protection, solely for the development of Australian industries, and the maintenance of a reasonable wage standard for Australian workmen. Therefore, in giving our support to this item, we are not pandering to the manufacturers. “We know quite well that manufacturers, like every other class of employers, in their effort to get the most out of their workmen, will exploit them to the full, and many, while doing this, indulge in a certain amount of flag waving. Conditions in the clothing trade in Melbourne are notoriously bad. This is one reason why Australian workers have banded themselves together in industrial organizations for the protection of their rights. It was grossly unfair on the part of- Senator Payne to place honorable senators on this side in an entirely false position in relation to the manufacturers. In supporting the duties in this sub-item, we are not condoning the action of the manufacturers who, as I have stated, are exploiting the workers.
– I did not make that statement. It appeared in the Labor Daily.
– The Labor Daily has spoken the truth in a large measure. The manufacturers of this country are taking full advantage of the tariff in order to strengthen their bank balances. But that is no reason why we should, by lowering these duties, expose the Australian clothing trade to the keen competition of low-wage countries.
– I am with the honorable senator on that point.
– Then I hope that the honorable senator will withdraw this stupid request to another place, to reduce the tariff in this sub-item.
, - There is no doubt whatever that this discussion will not end the conflict of opinion between high and low tariffists. Senator Payne has submitted his request on the first paragraph of sub-item a1 dealing with men’s overcoats and suits. No doubt the duties, 15s. British, .and 25s. general, are pretty stiff, but I know of no reason why every overcoat worn in Australia should not be made in this country. Several facts, apart from mere opinions, have been brought out during this discussion. One was indicated in the speech of the Minister, who pointed out that the cost in Australia of the raw material used in the manufacture of articles of apparel was higher here than elsewhere. *
– It is dearer, than the finished article.
– I was about to say that, in many instances, the cost in Australia of the raw material for some articles of apparel is higher than the f.o.b. price of the finished article in Great Britain. It would, therefore, appear that what is required to be reduced is the cost of the raw material, rather than the duties against goods of British manufacture. There has been rather too much said, and perhaps by honorable senators on this side of the chamber, about sweated labour conditions in Japan, Germany, and other countries. The “ Song of the Shirt,” referred to by a previous speaker, would apply, at the present time, to tens’ of thousands of sweated workers in the Mother Country. Consequently we have to consider whether the course indicated in the request would save Australia from reaching that level. I happen to know many persons, engaged in the clothing trade, apart from those employed in factories, and I doubt that the 60,000 operatives mentioned by the Minister embrace the whole of those engaged in that trade.
– The figures refer only to ‘ those employed in this particular section of the clothing trade.
– In Sydney there are literally hundreds, possibly thousands-, of persons, some men, but mostly women and girls, conducting small businesses for the making-up of clothing for sale. They are constantly met by their customers, who say that they would like to have a dress made of a certain material; but, as they can get it for so much less in some of the shops, they ask if the dressmakers can also bring down their prices to the lower level. In this way there is a constant endeavour to pull local prices down to the level of the imported articles. These are facts that have come to my knowledge, because I have a number of relatives engaged in these occupations. As to the statement made by Senator Dunn, about materials .being made up under the cheapest possible labour conditions in Germany, and sent to Great Britain for re-export to Australia, there was no occasion at all for any honorable senator to challenge his truthfulness, because it has been well known for a long time that this practice is followed. Time after time British industrialists have complained of the competition from articles of alleged British manufacture, upon which only the finishing touches - sometimes only the labels - have been put on in England. Senator Dunn has told me that he is prepared to produce, a British Union Jack that was manufactured in Japan. Some time ago I saw an attractive letter-card, showing, on . one side, a picture of the Sydney Town Hall, surrounded with trees, with a notice in small type in one corner indicating that it had been printed in Berlin. I do not blame the people of any country who are suffering because of the present depression for trying to make a livelihood; but I believe that we should resist any attempt by them to improve their position by making ours worse. “We shall not help the sweated workers in Japan or Europe to-. attain to a higher standard by allowing them to pull -down our standard of living. Consequently, we must give all the support we can to those engaged in industrial enterprises in this country. All the articles covered by this sub-item could be made well, and at a reasonable figure, in Australia. Thousands of our own. ‘ unemployed “ would be only too glad of a chance to make them. Imported costumes of various qualities, at’ prices ranging from many guineas to a few shillings each, may be seen in the big shops of every capital city of the Commonwealth. These imported readymade goods could be manufactured in Australia. We have ample labour, ability and material for the purpose. I ‘ admit that it is impossible, under our Constitution, to prevent the manufacturers from exploiting the people. Every time an endeavour has been made to increase our constitutional power in that respect, it has been frustrated by misleading press propaganda. We have to admit that we have been unable to protect our people from extortion by manufacturers who have been benefited by the building of our tariff wall. The manufacturers, as a class, have shown no gratitude whatever for what we have done to preserve the Australian market for them. As a class they always vote for the anti-Labour parties at election time. It is not in their interests that we favour substantial duties on these goods, but in the interests of their employees, who reap some benefit from the fostering of local industries. I am not a bigoted protectionist, nor do I desire to make every country a kind of watertight compartment; but, for the purpose of self-defence, we must do as we are done by. When our standards of living are menaced, we must protect them. While it is true that our people may be exploited to some extent by the manufacturers of our own country; it is also true that, if we abandoned our protective policy, they would be robbed by the rings of importers, who have no regard for the working people of Australia. Their main objective is to give expression to the principle of greed upon which the capitalistic system has been erected, and is maintained. They are out to get all they can, and the “ devil take the hindmost.”
– Are the manufacturers worse by nature than other classes ?
– I am not discussing the subject from the stand-point of the inherent vices and virtues of different classes of people. I am discussing the system which, by its nature, is callous and heartless to those who cannot help themselves. Of course, people who cannot help themselves might be just as bad as the other people if their circumstances were changed. I do not suggest that one class is entirely virtuous, or the other class entirely vicious; but the system lends itself to the exploitation of the less favoured section of the people by the more favoured section of them.
– If we refuse to accept goods from other countries, what will become of our surplus wool, wheat, and meat ?
– If all the people of our own country were properly supplied with foodstuffs there would not be such a big surplus. There is surely no reason why any of our people should starve while we have a big exportable surplus of foodstuffs. There can be no doubt whatever that a considerable number of our people do not get enough of the good things of this life, and, in the medley of things as they are, we should do the very best we can to see that those articles which can be manufactured in this country at a reasonable cost, and with- a reasonable degree of efficiency, shall be manufactured here, so that at least a proportion of our people who are to-day idle and, in some cases, destitute, shall be provided with work. It will be far better for us to do our own work than to accept the surplus goods of other countries under conditions which amount to dumping. As the Minister has told us, it is the custom for the manufacturers of the Old Country at the end of their season to unload their unsold goods in other countries where the season is suitable. Sometimes these goods are sold at the proper price, but often they are disposed of at any price.
– The honorable senator has exhausted his time.
– The interjection made a few minutes ago by Senator Lynch was pertinent’. No notice seems to have been taken of the ratio of our importations of woollen goods to the amount of wool which we export from Australia. Our exports of wool to Great Britain in the last two years have been as follows : -
I find on reference to Trade Bulletin, No. 26, that our imports of woollen garments from Great Britain under the present series of tariff items have been as follows : -
These figures show that for all practical purposes our importation of these classes of woollen clothing has ceased. Senator Rae, with his ability and experience, knows perfectly well that one-way trade of this kind is impossible: If we refuse to accept woollen goods in return for our wool, the inevitable result must be that Great Britain will take as little wool as possible from us. She will seek supplies from South Africa or any other country which will take her manufactured products in return. I have also extracted certain particulars in regard to our importations of woollen textiles from Great Britain. Though the following table is not exhaustive, it -is. surely significant: -
Our importations of woollen textiles mixed with cotton were valued at £31,370 in 1930-31, and at £17,846 in 1931-32. It will be seen, therefore, that our importations under these headings fell, in two years, from £121,619 to £35,079, which is just about l/300th part of the value of the wool which Great Britain took from us. It is not necessary for me to emphasize the moral to be drawn from these figures.
– What about the balance of trade?
– The high protectionist policy, which is the policy which honorable senators of the Labour party are at present seeking to give effect to, though it is not the policy expressedinthe Labor Daily, is not confined to woollen goods, but applies to everything which ‘can be produced in Australia, and it is doomed to failure. We cannot hope to place our wool industry on a permanently substantial base while we are doing everything possible to make everything we can in Australia to the exclusion of goods manufactured from wool which other countries buy from us.
.- I should not have spoken again in this debate but for Senator Payne’s criticism of a leading article in the Labor Daily. I thank Senator Brown for his defence of that article. I believe that honorable senators opposite, including Senator Payne, desire to play cricket’, politically speaking, and will therefore admit that honorable senators on this side of the chamber have never argued that the working class will be completely emancipated by. means of tariff adjustments. We realize that, at best, a tariff is only a palliative.
– Was not that leading article merely a bunch of carrots for Tasmania?
– The right honorable senator was a member of the Federal Labour Conference, which sat at Brisbane many years ago, and formulated the policy of new protection. Although Senator Pearce has now become highly respectable again, politically speaking, he did his best to tie together the bunch of carrots known as the new protection. It has been left to the younger generation to give expression to the new protection.
– I was not at the Brisbane conference.
– If the Leader of the Government in the. Senate, or any other honorable senator who doubts the accuracy of my statement, reads the history of the Australia Labour movement, he will find reports of the debates in which Senator Pearce, when a member of the Labour party, participated. Senator Brown ably defended the leading article in the Labor Daily, only a portion of which was quoted by Senator Payne. That article also states -
The . tariff revision now before the Senate arose out of the one-sided bargain that British diplomacy forced upon the Australian delegation at Ottawa. While it goes a long way towards destroying the wall of protection built by Labour around Australian secondary industry, it still does not go far enough to suit the freetrade aspirations of the so-called Country party, and therefore this organization, in Parliament, has made a determined assault for the purpose of still further lowering the tariffs. That it has failed in all but two of its attacks is due entirely to the altruism that is the fundamental of Labour philosophy, dictating that the Labour senators should place the safeguarding of home industries before political advantage, and, incidentally, save its enemies from their socalled friends. No doubt this is a very satisfying position for Nationalism, enabling it to keep its bargain with the manufacturers, while permitting its Country party allies to indulge in harmless gallery play for the benefit of their rural electors.It is but one of the ironies of the honest politics of the Labour movement.
A sub-article in the same newspaper, which is one of the outstanding daily newspapers in Australia, goes on to state that -
In addition, Labour must take cognizance of the fact that its high and universal tariff policy is strangling the weaker States, where the demand for a scientific system of reasonable protection graduated to accord with local conditions is assuming alarming proportions. The demand will split the Labour movement upon one of the fundamental planks of its platform unless that plank is adjusted to meet the admitted difficulties of Western Australia, South Australia, and Tasmania, and disunity resulting from such a policy consideration would have much more devastating effects than any disunity of the past resulting from mere personal or disciplinary causes. What, then, is the solution of the problem that calls loudly for solution? Admittedly, it is too difficult to be defined without a full and scientific inquiry, requiring an investigation of the results, direct and indirect, of the application of the tariffs of the last quarter of a century. Our new tariff policy must be based upon the unassailable principles, that the whole of the benefits of any protection granted must accrue to the workers in the industry concerned and the people generally, and not to the moneybags here or overseas. In the ranks of the Labour movement there are men with admitted economic training and practical experience who could conduct an investigation such as suggested. The movement would be well advised for a short period to set down the politician and set up the economist to ascertain just where we are going on the tariff issue.
I am glad to have the opportunity of placing the fiscal policy of the Labor Daily before the people of Australia. Honorable senators on this side of the chamber realize that Tasmania, Western Australia, and South Australia are suffering disabilities, but those disabilities cannot be overcome simply by removing the protective wall which has been erected by the Labour movement in the interests of the workers of Australia. We sympathize with the people in the smaller States, and realize that some system of economic research must be established before complete satisfaction can be achieved. Senator Payne has unsuccessfully endeavoured to use the Labor Daily to boost up his contention that the Labour party supports a freetrade policy.
– I have permitted the honorable senator to quote that article somewhat extensively, but he must now confine his remarks to the item before the committee.
– I am glad to have had the opportunity to defend the policy of the Labor Daily. In order to verify the statement made by Senator Rae that the Union Jack is manufactured in Japan, I have despatched an urgent wire to be supplied with a sample of the Japanese product. Honorable senators on this side of the chamber are in regular communication with their fellow Labour politicians and industrialists in Great Britain and in other countries, and these have given us specific instances in which goods supposed to be made in Leeds, Bradford, and in certain parts of Lancashire are almost wholly manufactured in Germany, and after tags and tickets have been attached, suggesting British manufacture, are exported to all parts of the Empire. That has been going on for a long time; but because a previous government and this Government have endeavoured to protect the woollen industry, they are assailed by Senator Payne and Senator Duncan-Hughes. The. Leader of the Opposition (Senator Barnes) gave a little backing and flattery to my dear friend, Senator Guthrie, concerning his production of wool; but I do not intend to repeat what he said, because, in my opinion, the honorable senator produces wool, not so much in the interests of Australia, but for his own particular profit. If Senator Payne wishes to support an argument by quoting from newspapers, I suggest that he should quote the whole article and not only extracts from it. The honorable senator quoted only a portion of an article in the Labor Daily so that it would be incor porated in Hansard, in the endeavour to convey the impression that that journal is advocating a freetrade policy. It believes in protection.
– The honorable senator has. exhausted his time.
– The request for which Senator Payne has moved is one upon which I do not desire to record a silent vote, especially as, if carried, it will cover a number of items. Senator Dunn, who has just resumed his seat, has sympathized with the position of the smaller States ; yet he joins with those who are making more grievous the fiscal burdens which the smaller States have to bear. Sympathy is of little value unless put into action in some way. -One of the grievances of the smaller States, is, as I have said before, and as honorable senators agree, the crushing burden of high duties, which have become so popular of recent years. The logical outcome of what has been said by honorable senators, opposite in support of these high duties, is that each country should live unto itself, because if Australia is to make within her own borders everything she requires, and importnothing, every other country must be entitled to do the same.
– We do not suggest that.
– Honorable senators have used words from which no other conclusion could be drawn. It is* true that they occasionally admit that there are some things which we cannot . produce, but they do not say upon what basis trade is to be conducted, if we are to pick out a few items which Great Britain can produce, and which we cannot produce, and exchange our goods only for them. If that was ever good in theory - and I doubt it, because it is the practice from which the world has evolved, not that towards which the world is evolving - it is now too late to give effect to it. Until we make up our mind either to pay off the debts that we owe overseas, or to repudiate them, we must meet the interest on them with our exports. Nothing can be done to reduce our debts abroad, excepting by increasing our exports, and we should do as much as we can to lessen the burden upon them. To those who do not realize how extremely complicated a thing the tariff is, and how extremely complicated are trade relations throughout the world at the present time, the argument that we should manufacture in Australia all the goods we now import makes a very strong appeal. As Senator Duncan-Hughes pointed out, however, if we are to trade, we cannot trade one way; we must have two-way trade or none.
– We admit that.
– The honorable senator admits it when it is put definitely to him, but the whole, trend of his argument, and that of those associated with him, is to the contrary. They deny the proposition in practice, if not in actual expression. I decline to treat the Scullin tariff as a tariff at all. It was put on in circumstances that I need not recapitulate, at a time when the ActingMinister for Trade and Customs (Mr. Forde) actually told .members of Parliament that employment had already been found for 50,000 persons as a result of the new duties, and that a further 100,000 would be employed as soon as the necessary machinery could be brought out from England to instal in factories. It never was a tariff which received the consideration of Parliament, of which the Senate is a branch. I have said that before, but it is a fact which cannot be too often stressed. If we go back to the position as it was before the Scullin tariff, we find that this present proposal of the Government actually doubles the specific duties then in operation. What is the reason for this extraordinarily high protection? The flat rate has been doubled, and added to the exceptionally high ad valorem duty of 30 per cent. British, and 50 per cent, general. It is admitted that we have the best advantages possible in Australia for doing this work. We grow the best wool that the world produces, and, as Senator Guthrie will no doubt assure us, we have extremely efficient mills. That being so, why “do we require to impose a crushing duty, not only against the products of foreign countries,, but also against those of Great Britain, a country with which we have entered into certain trade arrangements under the Ottawa agreement.
– Because otherwise the manufacturers there would dump their goods in Australia, and kill our local industry.
– The logical’ outcome of that proposition is that we must stop importation altogether.
– If necessary, yes.
– I told the honorable senator, and he would not believe me when I told him, that the logical outcome of his argument was that Australia, and every other country, must live unto itself. Was there any call for raising these duties at the time they were raised ? I can find none. I do not know where the Minister in charge of the bill found those figures which he quoted to the effect that the employment of 60,000 persons would be affected by a reduction of the duties? I presume the employment most directly affected by this item is that in tailoring slop-clothing factories. The Commonwealth Year-Booh for 1932 states at page 755 that the employment in those trades over the last five years has been as f follows : -
[Quorum formed.’] The figures indicate that there has-been a lamentable falling off of employment in the trades which these high duties directly affect, and which, presumably, they were intended to help. I do not wish to attribute that falling off entirely to the duties; it is only fair to admit that we have been passing through extraordinary times. But I quote the figures to show that, at any rate, the beneficial effect anticipated from the duties have not followed. I could show that, in other closely allied trades, the results have not been what was anticipated any more than in the one I have mentioned.” There has been a steady falling off in employment in all of them. Senator Crawford said that he was sorry that Senator Payne was not more definite in stating the object he had in view in making this proposal. In my opinion, the lack of definiteness is noticeable chiefly in the utterances of those who speak in .vague and general terms about the need for doing all our own work within Australia, and yet never pay any attention to the effect which that policy is having, and has had, on our unemployment figures. Senator Crawford said that the only effect of reducing the duties would be to displace Australian workers from our own factories. We do not admit that; on the contrary, we flatly contradict it. We believe that these duties are injuring the very persons whom they were intended to help; yet the high tariffists plead those very injuries as a reason why the duties which inflicted it should be still further raised. There was nothing at the time the duties were imposed to show that the industry was languishing, and there is nothing now to show that it has benefited from them. I, for one, came into the Senate pledged to do my best to secure something in the nature of a downward revision of duties or something to stop the ever-increasing upward trend, and for that reason I feel that I must support the proposal for a reduction in this instance.
– It is the manufactured article that we are dealing with under this item; not the semi-manufactured article such as the worsteds, woollens, flannels, &c, which our mills . produce so efficiently. I have always said that, while I am in favour of a downward revision of the tariff generally, there is one industry which it is economically sound to establish in Australia in all its branches, and that is the textile industry, because we are the largest producers in the world of its raw material. We pro-‘ duce the most wool, and the greatest variety of wools, of any country in the world. ‘ At the present time, we produce, roughly, one-third of the world’s wool supply, and more than one-third of the wool used for clothing purposes as distinct from what are called carpet wools. We produce 840 different varieties, as was learned when we were classifying our output during the period of control by Bawra. Manufacturers in this country have the great advantage of having the first choice of the best wools available. While I admit that this tariff is very high - the minimum ad valorem rate being 60 per cent, against Great Britain - there are reasons why even such high protection as that is necessary. Personally, I do not care how high the duty is against those foreign countries which do not trade with us, but I should be pleased to help the manufacturers of Great Britain so far as it can be done without injustice to our own people. Britain is still Australia’s best customer for everything we sell, and particularly for wool. She buys from us every year anything from 800,000 to 1,000,000 bales. We must have a world market for our great primary products, and particularly for our wool. If it were compulsory for every man, woman, and child in Australia to wear woollen clothing manufactured in Australia, we should still have to export and sell in the markets of the world 85 per cent, of our annual wool clip.
On the other side of the picture, we have this : The wages paid to the workers in the woollen mills, and in the readymade clothing factories of Europe, are very low. Even in England, they are low, while in Japan they are positively awful. I, myself, worked in the woollen mills in Yorkshire, as a young man, for ten hours a day for 25s. a week, and I never want anybody else to have to do that. The manufacturers of Great Britain make huge quantities of readymade clothing, and at the end of the ‘ season they have a large surplus, much of which they send to Australia, to be sold at any price.
– To what particular garment does the honorable senator refer?
– Ready-made overcoats, singlets, and other clothing. Enormous quantities of those garments are sent to this country, and sold at low prices.
– What nonsense!
– What I am saying is true. Last week I was shown a case of clocks which had recently beenimported into this country, and neither the case nor the clocks bore any mark showing the country of origin. I understood that it was necessary for imported goods and the case containing them to be marked with the country of origin. This case came through the customs in Sydney, and probably the goods were made either in Japan or. Germany. Evidently, in that instance, there was a lack of supervision or an oversight on the part of the customs officials. It is economically sound to establish all branches of the textile industry in Australia, and there is no reason for us to purchase imported articles of apparel, particularly woollen goods, when similar articles made in Australia can be obtained at reasonable prices. I was surprised to hear one honorable senator refer to a statement supposed to have been made by the Tariff Board that the reason for this high tariff was that the woollen and knitting mills of Australia were charging high prices for materials required by dressmakers and other manufacturers of clothing in Australia. The fact is that during the last two years the prices charged by the mills for all their materials has been reduced by over 40 per cent. The mills are not exploiting the public in any way.
– How does the honorable senator account for the Minister’s statement ?
– I am much surprised at it, because I know that the prices for worsteds, tweeds, flannels and knitted goods, are extraordinarily low at the present time because of the fact that record low prices for wool have been ruling for some years. The average price to the wool producer at railway stations for the year ending the 30th June - to-morrow - will not be more than 7½d. per lb.
– The price of wool does not make a great difference to the manufacturer.
– It makes some difference. The manufacturers have not been exploiting the public, and it is only their large turnover that has enabled them to make a fair profit. The Australian woollen mills are efficient, and arc manufacturing all classes of materials that we require. I do not think that the wages paid in the industry in Australia are too high, but they are far too low in some other countries. For that reason, and for the reason that dumping of surplus foreign goods may take place, I shall support the item as it stands, and not the request of Senator Payne. I take exception to one honorable senator opposite referring to Senator Payne as an antiAustralian. That statement was unfair and untrue, becauseSenator Payne is one of the most loyal Australians that I have met. He is most diligent and conscientious in his work, and he should not be called an anti- Australian just because he advocates a lower duty. Although I am not supporting his request, I have the greatest respect for him as a man, an honorable senator, and a good Australian.
– I was pleased to hear Senator Guthrie state that the Australian manufacturers, so far as their prices are concerned, are giving the Australian consumers fair treatment. I hope that they will adopt a similar attitude towards the workers in our various industries, because our policy of new protection provides that a worker must receive a wage which will enable him to live in decent comfort. It is customary for one honorable senator to seize upon a statement of an opposing honorable senator, and, by inference, to exaggerate it somewhat ; but I think that Senator Brennan, in drawing an inference as to what I said a few days ago, went a little too far. By interjection I referred to some economists in Australia as being “tame,” and I was surprised to find from Hansard that Senator Brennan had referred to my interjection as being one of those easy methods of imputing bribery and corruption. I fail to understand in what way the term “ tame “ can be distorted to mean “ bribery and corruption.”
– When I read the report of my speech in Hansard I found that I had misheard the words used by the honorable senator. My reply was, therefore, founded on a misunderstanding.
– My reference to “ tame “ economists did not mean that they would necessarily be influenced by money.
– Are there any wild economists in Australia?
– There are a few. There is hardly a politician who does not claim to be an economist. The supporters of the Government may regard my views as extreme, but there are other people who consider that I hold conservative views. It is all a matter of opinion. Senator Brennan has also inferred, from the statements of members of this side of the chamber, that we do not wish to trade with Great Britain, and that we should not be displeased if British ships came to Australia empty. No member of my party holds such views. We know that it is necessary to have back loading for vessels, so that shipping charges may be reduced. We require from the Motherland many things, such as large machinery which cannot be made in Australia. The cost of the Sydney Harbour Bridge was about £10,000,000, and much of the material required for such works must be obtained from Great Britain and the United States of America, countries which specialize in the manufacture of bridge materials. We must also import large quantities of fancy goods which cannot at present be made in Australia because of the lack of skilled workmen or special machinery. It is necessary for us to import literature, such as the works of great writers, magazines, and novels, for as yet, many are not able to appreciate Australian novels. But we should manufacture in Australia ordinary woollen goods and u certain quantity of cotton goods, even if that is to the disadvantage of British manufacturers. Mr. Perkins, a member of the House of Commons, asked the Right Honorable J. H. Thomas whether Great Britain should not refuse to buy our agricultural and pastoral products, in view of the fact that we were not buying certain British manufactures. M.r. Thomas diplomatically replied that he supposed that the Australian people read Hansard. It was infernal impudence on the part of Mr. Perkins to suggest such a thing. After all, we have the right to manufacture as much of our own requirements as we can. .The United States of America has flooded this country with films and motor cars, but has taken little from us in return. Every country is fighting for itself, and we have to adopt the policy of other countries, which is to sell as much as possible and to. buy as little as possible.
.- I am sorry that Senator Guthrie is not in the chamber, because I believe that if he were here I could persuade him to support my amendment. I thought that I had made out a clear case, sufficient to win the support of 75 per cent, of the members of the committee. The figures which I quoted ought to have satisfied any one that the request moved for would not jeopardize this industry. I refuse to regard the 1930-32 tariff as a tariff at all, because it was imposed on the people of Australia without this Parliament having an opportunity to discuss it. When, therefore, it is suggested, as the Leader of the Opposition (Senator Barnes) suggested to-day, that I am seeking to reduce the duties in a tariff schedule, I reply that I am doing nothing of the kind, but am merely endeavouring to prevent an excessively heavy addition to the tariff being authorized by this Parliament. I do not recognize the customs charges of the last two or three years as the tariff of Australia. Although I thank Senator Guthrie for the compliment he paid me, I would rather have his support to my request. The honorable senator’s reference to end-of-season goods was incorrect. Men’s overcoats and woollen underwear are not sent here from the Old Country as end-of-season goods at the end of the English winter.
– How does the honorable senator know that?
– It would not be a business-like act on the part of British manufacturers to dump men’s underwear in Australia at ridiculously low prices at the end of the English winter, although considerable quantities of other goods necessarily come here at the end of the English season, because in fashions the Australian follows the English season. It is true that at times, goods are sent here at prices lower than those which prevail at the beginning of the English season; but the quantity of such goods is infinitesimal compared with the total importation of the goods covered by the items in this division. In order to save time,- I agreed to all the items in this division being grouped ; had I taken them item by item, I should, probably, have had greater success. (Quorum formed.’]
If we agree to the duties set out in the schedule, we shall, in effect, say to Britain “We desire to trade with you no longer, but shall close our doors against your goods. ‘ Nevertheless, we want you to buy our ‘products.” It is sheer hypocrisy to say that the duties on British goods set out in this schedule give a preference to British manufacturers; they are prohibitive.
. - Whatever Senator Payne’s personal opinion may be regarding end-of-season goods coming here from Britain, the fact remains that the Tariff Board regarded the importation of such goods as a real menace to the Australian textile industry. While I have every respect for Senator Payne’s opinion, I prefer to be guided by the Tariff Board, which thoroughly examined the position.
– The board’s fears apply to only a limited class of goods.
– What applies to one class of goods may apply to other classes also. No one desires to sever our trade relations with Britain. Practically on its own* initiative, the Tariff Board is again examining the duties on these items. Throughout its report there is the suggestion that there should be a further investigation of these duties. To one of my fiscal faith some of these duties are not particularly agreeable, but they must be considered in the light of the conditions existing in Australia. Senator Brennan spoke of the 25,000 employees in the tailoring industry; but on page 8 of its report the Tariff Board states that in 1929-30 there were 61,913 persons employed in the various branches of the textile industry in this country, and that they were paid £7,880,116 in salaries and wages. Those figures indicate that we are dealing with one of the largest industries in this country. In the face of the Tariff Board’s report, we should not be justified in taking’ drastic action without again referring the matter to the Tariff Board.
– The industry developed rapidly under the old tariff.
– That is true. Et now employs a considerable amount of labour, and the goods it manufactures are being sold at prices which commend themselves to the public. Keen competition between Australian manufacturers tends to keep down the price of these goods.
– Then why impose a prohibitive tariff?
– We cannot afford to take any risk of competition from end-of-season goods from Britain.
– But the Tariff Board said that that competition applied to only one class of goods.
– That may be; but it could apply to other goods as well. The fear of dumping expressed by the Tariff Board in its report led it to accept the rates imposed by the Scullin. Government.
– The board referred only to women’s garments.
– It mentioned women’s garments. The board expressed the opinion that the 1921-30 rates of duty would permit end-of-season goods from England to compete unfairly with locally-made clothing. On page 9 of its report the board stated -
The fact that this reduction in price to the consuming public has been coincident with both the operation of the higher duties, primage and surcharges, imposed by resolutions, and the marked drop in the value of imports of apparel from approximately £1,000,000 in 1928-29 and 1929-30, to £71,000 in 1931-32, indicates that, in the general run of clothing the consumer is being well catered for by the local manufacturer, and that, in his prices, the local manufacturer has not taken full advantage of the duties.
That being the position, and the matter being now before the Tariff Board for consideration in terms of the Ottawa agreement, I ask honorable senators not to disturb the existing position. When the Tariff Board’s further report comes to hand, honorable senators will have an opportunity to deal with the items to which it refers.
– I agree with the Minister, and I appeal ‘to Senator Payne to have regard to ‘th’e relation that the tariff bears to industry generally in Australia. It should be of interest to him to know that despite high tariffs, the Statistician’s figures disclose a considerable reduction of the price of clothing, and this has been reflected in the wages fixed by industrial and arbitration tribunals.
– Owing to the fall in the price of wool.
– Wages have been reduced because of the reduction of the. price of clothing, and this shows that the protection granted to the textileindustry has not increased production costs to the extent that Senator Payne and others would have usbelieve.
– I have not suggested that.
– Does the honorable senator say that the present basic wage of 9s. 4d. a day is higher than industry can afford to pay, and that we should allow goods to be dumped into Australia, with the inevitable result that the basic wage would be further reduced? If Senator Payne takes the trouble to consult the Chambers of Manufactures, he will find that, in 99 cases out of 100, reductions of duty do not result in a decrease of the prices of imported goods. If the competition of Australian factories with overseas manufacturers were eliminated, the public would have to pay increased prices for British goods.
I remember discussing the cost of steel products with one of the biggest Australian manufacturers, and I referred to the disparity between the prices of British and Australian80-lb. rails. He said that if the duty on the British rail were removed, the Australian purchasers would not get a cheaper article, because the British manufacturers had to dump their surplus into Australia at any cost, for the same reason that large drapery emporiums hold winter and summer sales. If we reduce the duties under consideration, we shall throw Australians out of work, and yet pay no less for imported goods. As this and other governments are trying to keep our own men in employment, and as the Minister advises the committee that this industry gives direct employment to no fewer than 61,000 persons - probably a similar number are also indirectly employed - we should be reluctant to interfere with these duties.
Question - That the request (Senator Payne’s) be agreed to - put. The committee divided. ( Temporary Chairman - Senator reid.)
Majority . . . . 5
Question so resolved in the negative.
.- With a view to securing a test vote on sub-item b, I move -
That the House of Representatives be requested to make the duties, sub-item (bla) each, British,1s.; general, 2s.
I have given the committee an opportunity to revert to the rates ruling under the 1921-30 tariff. I hope that honorable senators will notice the description of the sub-item on which it is attempted to impose these heavy duties. I have already quoted an extract from the report of the Tariff Board with regard to apparel, in which it is admitted that the extremely high rate of 1,000 per cent., ad valorem, was imposed on British underwear, on the board’s recommendation. I have a few samples which I intend to display, and I hope that honorable senators will be led to realize the folly of imposing duties which are absolutely unnecessary. Under the 1921-30 tariff, the rates of1s. British, and 2s. general, gave the industry more than the protection that it needed, yet we are now asked to double those rates. The first sample I have for the inspection of the committee is a man’s athletic vest made entirely of cotton. This article does credit to the local manufacturer, and it can be purchased retail in any shop for 1s., at which price it returns a good profit to the retailer. The manufacturer’s price is7½d., and that also gives the maker a good profit. Yet we are invited to approve of a duty on goods of this class amounting to 2s. British, and 4s. general. Have we not reached an absurd position, when we are asked to impose a duty equivalent to at least three times the manufacturer’s price? In the case of a child’s undervest containing wool, the local manufacturer’s price at the mill is 8s. a dozen, and the retail price in three establishments in Bourke-street, Melbourne, is ls. each. The British invoice price of a similar garment is 6s. a dozen. Yet the duty that we are asked to agree to is 5s. each, equal to 1,000 per cent, ad valorem ! Is not that absurd ? It is my desire to reduce these duties to what they were previously. At that level, considerably more protection was given than was needed, and the industry developed so extraordinarily that it captured practically the whole of the trade. The mill price of a somewhat better-class ladies’ undervest, containing a small proportion of wool, is ls. 6d., and it is retailed in Melbourne stores at ls. lid. each. The duty in that case is 5s. That is a pro-, hi bi ti ve impost; yet we have the audacity to describe it as British preference ! The acceptance of my request would not in any way jeopardize the continuance’ of the industry on a profitable basis. It has proved that it can carry on profitably with the protection given under the 1921-30 tariff, namely, ls. each in the case of cotton goods, and 2s. 6d. each in the case of goods containing wool.
– Is there any practical value in the request?
– Are we to stand before the world as hypocrites?
– It is not a question of hyprocrisy
– It is a matter of principle. “We convey to the world the idea that we are giving Great Britain an opportunity to trade within the Commonwealth.
– With the” duty at 2s, 6d. on an article that is retailed at ls. lid., there is no opportunity to trade. That is hypocrisy.
– Under my request, the difference would not be nearly so great. Would the honorable senator like me to move to have the duty wiped out altogether ?
– The honorable senator knows that it would be impossible to carry such a request. It is my candid opinion that these flat rates are the height of absurdity, and are not in any way scientific. We ought to be content with an ad valorem tariff that would give the protection needed, so that those who are compelled to buy lower-priced goods would not be unduly penalized compared with those who are able to purchase the better-class goods.
– The principles involved in this case are identical with those that applied to the item with which we have just dealt. Specific duties, as honorable senators are aware, have existed for a considerable time. Their object is to control the importation of cheaply-produced goods. The Tariff Board has dealt with this question already, but admits in its report that it did not apply the principles of the Ottawa agreement; consequently, the report has been referred back to it for the application of those principles, and an opportunity will be given to all parties to submit evidence in support of their case. In these circumstances, if we are to complete the tariff before the end of July, we should endeavour to deal speedily with items that have a common principle. Unless honorable senators have any new point to make, I suggest that a vote be taken on Senator Payne’s request.
Motion (by Senator Dunn) negatived -
That the committee do now divide.
.- The Minister, innocently in all probability, has stated that this is on allfours with the last item. It is not. I had not the opportunity to corroborate my statements in regard to apparel other than knitted, but in this case I have given ocular demonstration of the absurdity of the position by the exhibition of a few samples. There is no suggestion in the report of the Tariff Board that this class of goods has been dumped in Australia.
, - I cannot see how the acceptance of Senator Payne’s request would improve the position very greatly, because, on his own showing, the duty of ls. British, and 2s. general, would give a protection of several hundred per cent. I put up my fight on the other group of sub-items, and accept the decision of the committee. It would be waste of time to embark on a further debate, seeing that no new principle is involved. The evidence in this case may be a little stronger than it was in the other, but the principle is exactly the same.
– Senator Payne acted somewhat unfairly when he produced garments of the lowest price, because the position is substantially different in the case of the higher-quality goods. If the duty were reduced, it would be possible to import certain classes of underwear. At a meeting in Cairns the other night, the Prime Minister (Mr. Lyons) made certain remarks regarding fanatics, which would apply to Senators Brennan and Johnston. The right honorable gentleman then said -
– I rise to a point of order. I desire to give honorable senators every latitude; but if a species of political “ box on “ is to be indulged in, I’ ask to be spared from it.
– I am following the honorable senator closely.
– I should not have spoken had not the Minister referred to the latitude that he was prepared to give to honorable senators. I should like to know when the honorable gentleman was vested with the authority to censor the views of honorable senators, especially those who sit on the Labour benches. We have been elected to this chamber by the same process as was adopted in his case.
– -The honorable senator must confine his remarks to the item.
– I am endeavouring to do so, sir, and, incidentally, to reply to the criticism of the Minister in charge of the bill.
– I raised a point a point of order against Senator Brown, which was dealt with by you, Mr. Chairman. I submit that it cannot be further discussed.
– I am not endeavouring to discuss the point of order. I am here to protect, not only Australian industries, but also the interests of honorable senators who sit on this side. The Prime Minister (Mr. Lyons) himself, who is the chief executive officer of the party opposite-
– The honorable senator must confine his remarks to the item.
– With all due respect, sir, I shall be obliged if you will not anticipate what I am about to say. The chief executive officer of the Commonwealth Parliament, who is the chief custodian of the tariff, declared at Cairns that certain persons were fanatics. Who were those persons? Do they include Senator Brennan and Senator Johnston? I should like to know.
– Because of the variety of articles covered by this group, I have allowed honorable senators a good deal of latitude, but I warn the honorable senator not to come into conflict with the Standing Orders.
– If our remarks are to be circumscribed because of the Minister’s pique, I shall insist upon availing myself of the full powers allowed to me by the Standing Orders when dealing with these items, for my party has every right to have its opinions ventilated on the subject. I appeal to honorable senators to reject the request that has been submitted by Senator Payne, and supported by Senator Brennan. I do not wish to censure Senator Brennan for his opinions; but he should have been more candid when on the hustings. Victoria is the State which gave birth to the Australian Natives Association, and it has been the sheet anchor of protection. Therefore, its representatives should give effect to the policy on which they were elected. The textile industry is well established at Launceston, Tasmania, and the people of the island State are also entitled to protection. I appeal to honorable senators to reject the request.
Question - That the request (Senator Payne’s) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 11
Question so resolved in the negative.
Sub-items agreed to.
Item 112 (a) (b2) agreed to.
Item 114, sub-items (f part) (i’2) (Hats, caps and bonnets).
.- I should like the Minister to explain why there has. been such an extraordinary increase in the duty on this item, which includes berets, a class of headgear which, whether made in Great Britain or Australia, is sold at considerably less than the amount of duty that the Government intends to impose. The women’s felt hat industry has progressed rapidly and extensively in Australia and, as every honorable senator knows directly or indirectly, its products are retailed at reasonable prices, otherwise the public could not afford to buy them. Yet’ the Government proposes to place a duty of 45s. per dozen, or an ad valorem duty of 45 per cent. British, on women’s hats, caps, and berets.
– These articles are made in Australia, and as the prices are reasonable, why bother about the rate of duty?
– I cannot adopt the prohibitionist policy which finds favour with Senator Barnes. The duty is not justified.
– What is the Australian cost of a woman’s felt hat?
– Prices vary greatly, according to the locality in which the hats are repurchased, and their quality. It is absurd to put such an extraordinary charge on berets, which may be purchased for as little as ls. 6d.
– All of these things are made in Australia, so that the duty really does not operate.
– That is no justification for such extravagantly high duties.
– The rates of duty that are proposed are the same as those which were advocated by the Scullin Government, except that the general rate has been increased from 60 per cent, to 65 per cent, ad valorem to give effect to the Ottawa agreement preference formula. These goods formed the subject of a recent inquiry by the Tariff Board, which recommended the retention of the rates proposed by the Scullin Government, and subsequently reimposed by this Government, for the following reasons: -
Those remarks are contained in Tariff Board report No. 490, dated 4th December, 1932. Since the report was submitted the board has suggested that the duties imposed under the British preferential tariff should be referred back to it to enable the board to determine whether they conform with article 10 of the United Kingdom and Australia Trade Agreement, which requires that protective duties imposed by the Commonwealth shall not exceed such a level as will give United Kingdom producers full opportunity of reasonable competition on the basis of the relative cost of economical and efficient production.
– The reference to the Tariff Board would apply to other articles also?
– It would apply to the whole of this item. In view of the evidence regarding the satisfactory development of the industry and the employment it provides, the Government considers that until the board is in a position to make a further recommendation the duties now proposed should be adopted.
– Does the Minister conscientiously consider that the spirit of the Ottawa agreement is being sufficiently honoured by raising the general duty by 5 per cent., and allowing the prohibitive British duty to remain?
– The Government sincerely desires to implement the Ottawa agreement, and has adopted the only course by which that can be done. That course has received the approbation of the British Government, which is aware that the items are to be referred to the Tariff Board. The board has stated that the duties do not conform to the Ottawa agreement, and has expressed a desire to reconsider them.
Senator Sir WALTER KINGSMILL (Western Australia) [5.17]. - I am not pleased with the Minister’s answer. I can only hope that other portions of the Empire will carry out their duty to Australia under the Ottawa agreement more liberally than we are doing our duty to them.
Blankets, n.e.i. (except of rubber) ; blanketing; lap dusters; rugs, n.e.i., including buggy rugs or aprons but not including fur or other skin rugs and rugging, ad valorem, British, 35 per cent.; general, 55 per cent.
.- The British duty has been increased from 25 per cent, to 35 per cent., and the general duty from 45 per cent. to 55 per cent. The Tariff Board, in a report dated the 25th June, 1930, recommended this increase, but I cannot find in the evidence any justification for it, in view of the fact that 91 per cent. of the blankets used in Australia are of local manufacture.
– We want the whole of the trade to be given to Australian manufacturers.
– That the industry has had adequate protection is proved by the fact that it has captured 91 per cent, of the local trade.
– Why should it not have the lot?
– It has practically the lot in woollen blankets; so, why in crease the duty? Practically the only importations are certain types of light, cotton blankets for use in warm climates, and child’s blanket’s made out of fleecy cotton materials. It is gratifying to know that Victorian manufacturers supply about 70 per cent. of the woollen blankets used in Australia.
– Because they produce the best blankets.
– The best blankets made in Australia are the product of the Waverley Mills in Tasmania. I move -
That the House of Representatives be requested to make the duties, ad valorem, British, 25 per cent.; general, 45 per cent.
– The rates proposed under this sub-item are, except for an increase of 5 per cent. under the general tariff in order to give effect to the formula margin of preference under the Ottawa agreement, the same as those proposed bythe Scullin Administration. The Tariff Board inquired into the duties on blankets and the other goods covered by this item, and in June, 1930, furnished a report in support of the Scullin Government’s proposals. Prior to the board’s inquiry, importations of blankets and rugs had over a number of years represented12½ per cent., according to value, of Australian requirements. A considerable proportion of the importations was represented by low-grade blankets, which were sold because they were cheap; but in most cases the purchaser would have obtained better value if he had paid a higher price for the local article. The board considered that the increased production which would follow an increase of 10 per cent. in the rates of duty would create additional employment and bring about a reduction in overhead costs through the operation of a number of idle looms. Local competition is keen, and there is little likelihood of manufacturers talcing advantage of increased duties to charge higher prices for Australianmade blankets and rugs. The tribute that some honorable senators have paid to the local industry is well deserved. I have seen rugs made at the Geelong, Tweedvale, Waverley, and Yarra Falls mills, and they lack nothing in quality. In Albany, Western Australia, also very good rugs are being produced. The blankets manufactured by mills in the eastern States are remarkably fine, and merchants handling them ask for nothing better. The purpose of the duty is plain, and it is supported by the Tariff Board’s report.
– The items in the group now under consideration are those which were “ amended, by the Scullin Government and supported by Tariff Board reports “. I understand that the supporters of the Ministry are advocating a tariff schedule based on the Ottawa agreement and the recommendations of the Tariff Bo”ard. The board’s report supports the duties contained in the schedule. If they are to be altered at all, a more reasonable amendment would be one to increase the British, preferential rate to 45 per Cent., and the general to 65 per cent., with a view to enabling local manufacturers to capture the 9 per cent, of the trade now enjoyed by the importers.
– The board has stated that they will capture the remainder of the trade with the aid of these duties.
– These rates were proposed by the Scullin Government in accordance with its tariff policy; they have been endorsed by the Tariff Board ; and .the present Government is content to allow them to remain. But this does not satisfy State protectionists and freetraders of the type of Senator Payne. Criticism of the manufacturing interests comes ill from him in view of the subsidy paid by the Commonwealth to the Tasmanian fruit industry.
– Order ! The honorable senator must confine his remarks to the item.
– If . Australia has to be dependent on any country for its supplies, I would prefer that it should be dependent on the United Kingdom. But there is no need to rely on British manufacturers for blankets, because our own mills can produce the very best quality from Australian wool. We might as well have our washing and mending done in the United Kingdom as rely on manufacturers there to supply us with blankets made from Australian wool. Senator Payne merely insults the intelli- gence of the committee by moving request after request to the items in this group. As a supporter of the Government, the honorable gentleman should have no reason to complain about the duties imposed, especially in view of the fact that Tasmania has benefited substantially from the protectionist policy of the Commonwealth. We have evidence of this in the establishment, at Hobart, of Cadbury, Pascall and Fry, chocolate manufacturers, and a number of other industries: But apparently the honorable senator, in. defiance of Tariff Board reports, and in defiance also of the Government’s policy, is determined to do all that he can to reduce the protection given to Australian industries. His attitude to the tariff would justify honorable senators on this side in moving for an increase of protection in every item.
– I am surprised that Senator Payne has submitted a request for a reduction of the duty on blankets.
– My purpose is to bring the duties down to the level of the legal tariff.
– Then the honorable senator is moving for a reduction of the duties. His action in regard to this item is the more remarkable because the manufacturers of blankets and rugs have established the industry on a most efficient basis. Australian blankets are, in my opinion, superior to the product of any other country. The mills at Warrnambool, Victoria, produce the finest blankets I have seen, in my 40 years’ experience of the wool industry. That company is now manufacturing a special high-class blanket which it exports to the west coast of America and to China and competes with Japanese blankets.
The rugs made by the Returned Sailors and Soldiers Co-operative Woollen Mills at Geelong are equal to anything in the world, and the price is quite reasonable.
– No woollen blankets are imported.
– Some must, be imported, because the honorable senator said that Australian manufacturers were supplying 91 per cent, of the Australian trade.
– I was referring to cotton blankets.
– No one in Australia should use cotton blankets. The woollen article is warmer, and more hygienic, and better even in a hot climate. Wool is a non-conductor of heat and cold, whereas cotton is a conductor of both heat and cold. Victorian manufacturers of blankets and rugs supply about 70 per cent. of Australia’s requirements, their product being superior to that of manufacturers in any other part of the Commonwealth. I am opposed to a reduction of the duty.
Item agreed to.
Items 120 (aa) and 124 agreed to.
Division 6. - Metals and Machinery
Items 137 (a2), 138 (a) (b), 148 (a) agreed to.
Item 153, sub-items (b) (d) -
.- Underthe 1921-30 tariff the rates on cast iron pipes of the dimensions indicated in sub-item b, were, per ton, British, 48s. ; general,80s. ; with an intermediate rate of 65s. Can the Minister indicate how these ad valorem rates compare with the fixed rates per ton in the 1921-30 tariff?
– These rates represent approximately 15 per cent. British, and 35 per cent, general.
– That being so, I move -
That the House of Representatives be requested to make the duties, sub;item b, ad valorem British, 15 per cent., general, 35 per cent.
– This subject was reported upon by the Tariff Board in 1927. The formula of the Ottawa agreement has not been applied to this item because, as all our imports of these pipes come from the United Kingdom, the British representatives at Ottawa agreed that the formula was not necessary in this case. Apparently, under the old rates, the duties were slightly lighter on pipes of more than 2-inch, internal diameter. I ask honorable senators not to agree to the request.
– My reason for moving this request is that ‘the price of these pipes is too high now, and this increase of duty may make it still higher. I can understand the members of the Opposition accepting the rate of duty provided in the schedule, for it is in conformity with the Scullin Government’s tariff policy; but I cannotunderstand the Government attempting to foist the Scullin duties on us. Yet it is doing so time after time. The primary producers cannot afford to pay the price asked for these pipes. Tariff making under these conditions has become a farce. The Ottawa agreement was entered into only six months ago, but the spirit that prompted the making of it seems already to have been lost.
– Can the honorable senator furnish us with any information to the effect that the price of these pipes has been increased?
– The price of all pipes of this nature has gone up unduly in the last couple of years.
– I have been assured that on the basis of the existing cost of manufacture in Australia, the imposition of these duties will place a serious burden upon the users of pipes without conferring any adequate compensation upon the community. Careful calculations show that the quantity . of pipes of this kind that would cost £100 if imported, would cost £175 if made in Australia. Perhaps our railway and tramway authorities, and water and sewerage departments, may be able to pass the extra cost of these pipes on to the consumers, but the primary producers certainly cannot do so. This is one of the duties which affect every new water supply in the agricultural areas of Australia. Every penny of additional money that has to be paid by pastoralists and agriculturists for pipes must be added to the cost of production. In these circumstances, I support the request.
.- It is unnecessary to occupy much of the time of the committee in discussing this item, for even if the duty were only 10 per cent., it is unlikely that these pipes would be imported. Our importations under this heading, in the last couple of years, have been practically nil. These pipes are too heavy and too liable to breakages, and the freight charges are too high, to justify substantial overseas purchases. Under the existing exchange conditions, and leaving primage quite out of consideration, importations are practically prohibited. As the rate of duty set out in the schedule has been recommended by the Tariff Board, I shall support it.
– I am against prohibitions and embargoes of every kind, and as Senator Grant has said that there is practically a prohibition on the importation of these pipes. I shall support the request. The’ honorable senator has shown conclusively that this duty is not necessary.
Question - That the request (Senator Badman’s) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 8
Question so resolved in the negative.
Sub-items agreed to.
Item 154, sub-item (e) -
Railway and tramway materials, viz. -
– I move -
That the House of Representatives be requested to leave out the fixed duty, British preferential tariff,11s., and make the ad valorem duty, British, 274 per cent.
The rate that I have requested was the rate provided in the 1921-30 schedule. The Government is suggesting an alternative duty in this case which would make the importation of these fishbolts impossible. The duty on this item affects the cost of railway and tramway construction in Australia, and so adds to the cost of transport in cities, towns and country alike. This affects the freight charges on all primary products. I have been informed that at the rate of duty provided in the schedule, British manufacturers have no opportunity of reasonable competition.
– Although the board furnished a report on this item as recently as the 4th March, 1930, the item has been referred back to the board. The rates in the schedule are those which apply to ordinary bolts and nuts. As these goods are actually bolts and nuts, there does not appear to be any reason for applying different duties. The local manufacturers are able to supply all Australia’s requirements. The ad valorem duties are slightly lower than those recommended by the Tariff Board, but are in keeping with the duties imposed on general iron and steel manufactures. No alteration is proposed on the previous government’s rates, except that the general tariff rate has been increased by 5 per cent. to conform withthe Ottawa agreement formula. The Tariff Board, on page 16 of its report, refers to the advantages expected to follow the increased production of bolts arid nuts. It states -
If by reason of the granting of additional protection the production in Australia of bolts and nuts is increased to the extent it is anticipated it will, then the following advantages should result: -
Discussing fishbolts, the board states -
The applicants claim that fishbolts are actually bolts and nuts, and should be subject to the same rates of duty. Taking into consideration that there is no appreciable difference between the costs of production of fishbolts and of ordinary bolts and nuts, it is only reasonable that the same rates of duty should apply. The board recommends, therefore, that the application be granted so far as fishbolts are concerned.
The board was asked to review its report, and advise the Government whether it had applied the principles of the Ottawa agreement in framing its recommendations. The board has now decided to reconsider the whole subject, and to issue a new report. In the meantime, the Government, having regard to the recent date of the present report, has decided to allow the duties to stand.
Sub-item agreed to.
Item 161, sub-items (b1, 2, 3) and (c)-
– I move -
That the House of Representatives be requested to make the duties, sub-item (c), ad valorem, British, 20 per cent.; general, 35 per cent.
These pumps are an absolute necessity, and are in everyday use by orchardists, gardeners, &c. If the present high duties remain in operation, the users of pumps will have to pay more for them.
– On the 7th December, 1931, the Tariff Board reported on this item, and recommended the duties which appear in the schedule, but the item has been in the hands of the board for the last ten months for further consideration. With the exception of an increase under the general tariff of 5 per cent. for the purpose of conforming to the Ottawa formula, these duties are the same as those proposed by the previous government, and are in accordance with a recommendation of the Tariff Board. The local manufacturers are in a position to supply all requirements, and the duties have been the means of diverting the trade from imported lines to Australian-made goods. The Tariff Board is satisfied as to the ability of local manufacturers to supply goods of satisfactory quality at reasonable prices. An undertaking was given to the Tariff Board that prices would not be increased, and it was said that increased business would result in a reduction of prices. If that undertaking has not been fulfilled, the department would like to know, because there is machinery for dealing with breaches of such undertakings. In a Tariff Board report dated the 7th December, 1931, the board comments in these terms on the request for increased duties -
From evidence tendered and samples submitted, the Tariff Board is satisfied that the quality of the Australian products of the types under consideration is good, and that they give satisfaction to users generally. Although these goods are in very general use, and the public inquiry was widely advertised, no witnesses appeared in opposition to the request for increased duty.
On page 9 of the report it states -
It was stated that under the rates operating prior to the 20th June, 1930, the bulk of the Australian requirements was imported. Evidence available to the board confidentially indicates that the operations of the Australian manufacturers under these rates could not be regarded as reasonably profitable.
On the next page the following occurs : -
As to raw materials, complaint was made regarding the prices charged by Australian suppliers of brass sheets and tubing. It was claimed that such prices are in some instances almost equivalent to and in others higher than the landed cost of similar imported material, including duty and the existing abnormal charges. In support of this statement evidence was given that imported brass tubing inch external diameter could, at the time of the inquiry, be landed at1s. 7.5d. per lb., while the price of similar material of Australian origin was1s. 7.1d. per lb., and that brass sheet could be imported at a cost of11d. per lb., against a cost of1s. 0½d. for similar sheet produced locally.
SenatorJ. B. HAYES (Tasmania) [6.9]. - I hope the request will be agreed to. This item deals with hand pumps on which the duty is 45 per cent. British, and 65 per cent. general. These are the pumps used by the smaller orchardists. Those in a bigger way can afford to use power pumps on which the duty is only 20 per cent. British, and 35 per cent. foreign, which are the duties proposed in Senator Sampson’s request. The cost of spraying is a tax in itself, because orchardists have to spray five or six times a year. These duties will make the small man pay twice as much as is demanded from those in better circumstances.
Question - That the request (Senator Sampson’s) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 3
Question so resolved in the affirmative.
Request agreed to.
Sub-item agreed to subject to a request.
Items 169 (d), 176 (il, 2) and 177 (b1, 2, 3) agreed to.
Sitting suspended from 6.15 to 8 p.m.
Item 180, sub-items (a2) (d) (e1, 2, 4, 7 to 16, 18 to 21, 24) (gl, 2, 3) (l) (m) (n) (Electrical and gas appliances).
– I should like some information from the Minister on subitem d relating to filament lamps for lighting and heating. These lamps are used in the mines of Western Australia, and at one time no duty was imposed on British lamps. The rates are now 2s. per lb. British preferential, and 4s. per lb. general. This is one of those little things which add to the general cost of mining, and I should like to know from the Minister whether there is any chance of some relief in this direction.
– These proposals are the same as those imposed by the previous government, and are in accordance with the recommendations submitted by the Tariff Board in April, 1931. As compared with the 1921-30 tariff, an increase of 2s. per lb. is made. The Tariff Board’s main reasons for recommending the duties were -
As honorable senators are aware, the Newcastle factory is now supplying the majority of the lamps on the market, and since their manufacture commenced in Australia, the retail prices have been reduced by approximately 20 per cent. It seems to me that a good case has been made out for the maintenance of these duties.
– I wish to refer to subitem 180 e, paragraph 24, relating to parts,n.e.i. , of wireless receivers, other than cabinets. This sub-item, I believe, was passed by the House of Representatives for consideration in the Senate, if the report of the Tariff Board was received in the meantime. I understand that that report was received about fourteen days ago, and I should like to know whether it is the intention of the Minister to alter the proposed duties.
, - This sub-item was referred to the. Tariff Board for report, but I am informed by the departmental officers that its report is not yet to hand.
Sub-items agreed to.
Items 181 (bI), 182, 187 (b) and 200 agreed to.
Division 7. - Oils, Paints, and Varnishes
Item 225, sub-item (o) (School chalks).
.- The duties under this item are just double those under the tariff of 1921-30. Will the Minister explain the necessity for this heavy increase of duty?
.- The Tariff Board reported on this matter on the 6th March, 1928, report No. 233. ‘ The proposed rates under this sub-item are the same as those imposed by the Scullin Government, and are recommended by the Tariff Board. As compared with the 1921-30 tariff, the proposed rates represent an increase of 25 per cent. The Tariff Board stated that the industry was conducted efficiently, and could meet the requirements of the Commonwealth in the class of goods under notice. Users of the goods including Government education departments, have expressed themselves as satisfied with the locally-made chalks. As the result of the inquiry, the board was satisfied that the local industry was at a disadvantage in respect of competition with imported chalks. While realizing that the output of the local industry would be restricted to the extent of the local demand, the board considered that the industry was deserving of increased protection for the following reasons : -
Sub-item agreed to.
Items 231 (G1, 2), and 232 (a) (b), agreed to.
Division 8. - Earthenware, Cement, China, Glass and Stone.
Items 237 (c), 240 (bI), 244 (b), 251 (c), 255 (a) (b), agreed to.
Item 259 (Roofing slates, n.e.i.).
– I understand that this item has been referred to the Tariff Board. The rates of 40 per cent. British preferential and 60 per cent, general, as set out in this item, are heavy, and at a time like this, when an effort is being made to revive the building industry, we should try to lighten the cost of building materials, of which roofing slates form an important part in respect of betterclass residences. The proposed rates represent an increase of 15 per cent, on the Bruce-Page Government’s tariff, and I should like to know whether the report of the Tariff Board on this item has been received.
.- The Tariff Board reported on this item on the 30th June, 1931, Report No. 409, but it has again been referred to the board. The proposed rates are the same as those imposed by the previous Administration, but are higher by 15 per cent. British preferential and 25 per cent, general than the 1921-30 tariff. The Tariff Board held an inquiry into this item and furnished its report, in June, 1931, in favour of the increased duties now incorporated in the tariff proposals. At the date of the board’s inquiry, the production of roofing slates in Australia was confined to the Chatsbury quarry, near Goulburn. The quality of the local slates was stated to be quite satisfactory, and the price lower than that of the imported slates. The board was satisfied that the local industry could meet Australian requirements. It. was stated at the inquiry that the local quarry was unable to meet requirements in the larger slates commonly used in Australia, and the board referred to the fact that an authoritative opinion had been given that random-sized slates were in demand, not perforce, but by choice. During the past twelve months it has been brought under the notice of the Customs Department that the local quarry is not in a position to supply a fraction of the demand for the 20 in. x 10 in. size of .roofing slate, which was claimed to be the size popularly used. Inquiries made by the departmental officers established the claim that this size of slate was the one in most demand, the reason for its popularity being its economy of use as compared with smaller-sized’ slates. Less timber, nails, and labour were required in the laying of these slates than were necessary in the laying of smaller sizes. It was also ascertained that the local quarry was in a position to supply only a small percentage of the requirements of the 20 in. x . 10 in. slates. In view of the importance of roofing slates to the building industry, particularly in respect of the erection or re-roofing of public buildings, it was considered that further inquiry was necessary. Accordingly, the question was referred to the Tariff Board for review. In the meantime, however, the Government considers that the proposed duties should be maintained.
– In view of the statement of the Tariff Board, the query raised by Senator Johnston is fully justified. The board has stated that slates are produced in Australia only from one quarry at Goulburn. No one would suggest that that quarry could produce the whole of our requirements of roofing slates. It has been admitted that it cannot. Since slates have to be imported to meet the requirements of Australia, why should we penalize the users by imposing duties which must have the effect of increasing the cost of building? No doubt the Goulburn quarry supplies the demand for slates in a portion of New South Wales; but slates cannot be conveyed, economically from Goulburn to, say, Melbourne, Adelaide, Perth, Brisbane, and Tasmania. I suggest that the additional duties should be suspended until the Tariff Board has furnished its report.
Senator Sir WALTER KINGSMILL (Western Australia) [8.12]. - Using this item as an example, it is obvious that many of these duties, especially in this particular group, are not necessary for protection purposes. Is it right then for me to infer that what is aimed at is not protection, but prohibition; and, if so, how does that fit in with what is known as the spirit pf Ottawa? I should like the Minister in charge of the bill to give some information on that point.
– This item has been referred back to the Tariff Board with a statutory direction from this Parliament to apply to it the principle underlying the Ottawa agreement; and when its report is received, it will be time for us to discuss whether it has given sufficient attention to those principles. The department is fully alive to the point raised by Senator Payne that the Goulburn quarry is not capable of supplying the whole of the requirements of Australia, but I am informed that an additional quarry in another State is soon to be opened up, and there may, of course, be some relief from that quarter. This item will, within the next few months, be examined in detail by the Tariff Board.
– My point is that it was unwise for the Tariff Board to recommend the additional duty when, on its own statement-
– What I read was not the board’s own statement. ‘ The honorable senator is under a misapprehension. The statement which I have read was furnished as a result of subsequent inquiries by. the departmental officers, who are constantly policing the tariff. The Tariff Board unequivocably recommended the proposed rates of duty.
– On-what ground did the Tariff Board recommend that the British preferential tariff be increased from 25 per cent, to 40 per cent.?
– The board was satisfied that the local industry could meet Australia’s requirements. At the time of the inquiry the only quarry operating was that at Goulburn. The board also stated that the use of randomsized slates was the result, not of accident, but of choice. Sin’ce then, departmental inquiries have been set on foot. Persons engaged in the building trade and allied trades made representations to the department that the existing duties pressed unduly on those who desired to erect buildings, and the department found that local manufacturers could not supply the demand for slates 20 in. x 10 in. That is the opinion of the departmental officers; but since we have a Tariff Board, whose duty it is to investigate matters of this kind, it is only right that that body should inquire into this point. There is another quarry in a different State, which may be able to meet the demand for these materials. It is essential, therefore, that we await the report of the Tariff Board before taking any drastic action. In considering this question, the board will have to give effect to the statutory direction from this Parliament to take into account the provisions of the Ottawa agreement.
– The board will have a difficult job.
– I do not think that it will be particularly difficult, because the principles to be taken into account have definitely been laid down. The board must fix a rate of duty which is competitive rather than prohibitive, having regard to Australian conditions.
Item agreed to.
Item 262 (e) agreed to.
Division 9. - Drugs and Chemicals.
Items 266 (cl) and 275 (d) agreed to.
Item 281 (a2a, b) (b1, a, b) (f) (m) (nl, 2).
.- I move-
That sub-itemnl, 2, be postponed.
The promised inquiry into the activities of bismuth mining operations in Tasmania have not yet been completed, but it is hoped that a report will be furnished before bismuth metal and bismuth salts are dealt with in a later group. The investigation is so important that the Government desires the postponement of these subitems.
Motion agreed to.
Sub-items (a2, . a, b) (b1, a, b) (f) (m) agreed to.
Sub-item (n1, 2) postponed.
Division 10. - Wood, Wicker and Cane.
Items 291 (d) (f1, 2, 3) (i2) (j) (k) (l), 292 (a) to (h), 293 (a) (b) (c), 294 (a) (b) (c), 295 (a) to (g), and 296 (a) agreed to.
Division 11. - Jewellery and Eancy Goods.
Items 318 (a2, 4a), 319 (b1), and 320 (b), agreed to.
Division 12. - Hides, Leather, and Rubber.
Item 325 (a) agreed to.
Boots, shoes, slippers, clogs, pattens and other footwear (of any material) n.e.i.; boot and shoe uppers and tops (except of felt) ; cork leather or other socks or soles, n.e.i., ad valorem - British, 45 per cent.; general,65 per cent.
– The duties on boots, shoes, slippers, and other footwear, covered by item 329, press heavily on purchasers and particularly on the poorer members of the community. The duty on boots from foreign countries is higher even than the rate under the Scullin Government’s tariff. Thanks to a very high and constantly increasing protection the boot-making industry, which has been established in Australia for a great many years, has expanded until now it has a large output, and employs a great number of people to whom a considerable sum is paid in wages each year. All these things
I freely admit. On the other hand, it might be claimed that these workers could well be employed, and the money spent, in other directions. I admit also that this industry provides a market for leather, one of our primary products. Before the costs of production rose to their present high figures, Australia had a considerable overseas trade in boots with New Zealand, and even Russia and elsewhere. High production costs during recent years have, however, resulted in the loss of a considerable portion of that overseas trade. Australia’s hopes are now, apparently, centred on an expansion of trade with Eastern countries, but I cannot see how this country can hope to compete successfully with J apan in that market in view of the very low production costs in Japanese factories. The “ good-will ship “ which we sent to the East returned with the report that the Japanese were already fairly well established there. Consequently, I regard all this talk of developing our trade with Eastern countries, particularly in the productsof secondary industries, as merely a pious aspiration which, in present circumstances, is not likely to be fulfilled. In 1930-31 Australia exported footwear to the value of £24,000, of which amount our exports to New Zealand comprised £10,000. In the following year our exports of footwear represented a value of £52,000, New Zealand’s purchases being £35,000. In view of those figures, I cannot understand the recent statement of the Minister for Trade and Customs (Mr. White) that our trade with New Zealand is shrinking. Perhaps Senator Greene who has just returned from New Zealand, will be able to throw some light on this subject: I understand that it is because New Zealand has established its own boot and shoe factories, that our trade in footwear with that dominion is diminishing.
– I am informed that Australia’s trade in boots with New Zealand is increasing. The exchange position has altered things considerably.
– I accept the Minister’s statement; but it does not square with the declaration of the Minister for Trade and Customs in another place, that our costs had increased considerably, and that w.c had lost a great deal of our export trade.
– They were comparing different periods. Australia had a big trade with New Zealand immediately after the war.
– The Minister’s interjection merely strengthens my argument. In making comparisons, it is always better to have the figures for a period of years than for one year only. It certainly was stated that the growth of manufacturing industries in New Zealand had led to a decreased demand for Australian goods. That points another moral - that a country which is operating under heavy production costs will eventually find that the countries to which its exports are sent will establish their own industries, because they see a chance of making pro fits thereby. We shall find in the future, as we have found in the past, that, although our secondary industries may enjoy a fair export trade for a time, the volume of exports will inevitably drop, and we shall be forced to rely again on our primary industries. I urge a reduction of the duties on footwear, first, because the duties in this schedule appear to be abnormally high. The British preferential rate is 45 per cent., and the duty on foreign footwear is 65 per cent. In the case of an industry which has been established for over half a century, those duties appear to indicate that there is no expectation of the industry being a success economically; or, if there is any chance of the industry being successful, all I can say is that a great deal too much is being paid to it by the general taxpayer in the form of indirect taxation. I move -
That the House of Representatives he requested to make the duty, ad valorem, , British, 30 per cent.
The lower rate, together with exchange and other factors, would give a natural protection of about 65 per cent. against Britain, and about 100 per cent. against foreign countries. The present British preferential rate is altogether too high. Particularly in times like the present, we should do what we can to ensure that the masses of the people are able to obtain boots and shoes at reasonable prices. Every honorable member must realize how lamentable, particularly in the winter months, is the condition of men who are compelled to walk about with boots or shoes outat heel. I have received a letter, dated the 15th June, from the secretary of an Adelaide organization, of which I happen to be a committeeman. The letter is written to me personally, without any idea of its being used in any political way. It states -
We are having a tremendous number of people applying forboots, leather, &c. We do our best to meet their requirements, but many have to go away empty-handed. I hate having to turn them away, but our funds will not allow us to buy new boots to any extent. I am sending a circular to a number of people asking for help. I am enclosing a copy of the circular.
I shall not read the circular ; but it shows even more acutely, how great is the need for boots and shoes among the poorer sections of the community. This organization, which is one of the best in Adelaide, has been in existence almost as long as the State itself. It has the great merit that the present and the previous secretary have been conversant with the poorer people, and have been able to form a correct idea of which are really deserving cases. Sometimes a family’s misfortune is due entirely to the default of the husband; a number of children may be de- - pendent on their mother, who has been deserted by her husband. Organizations of this kind should receive all possible assistance. I ask the committee whether it is fair to prevent unfortunate individuals from being supplied with cheap footwear.
– Would the reduction of this duty make footwear any cheaper ?
– It is impossible for me to answer that question. I would willingly suggest a greater reduction of the duty than I have proposed; but, on general principles, I am in favour of reducing duties gradually. My suggestion, if adopted, certainly could not make boots more expensive than they now are, and it might help to bring down the price. I am not suggesting that we should flood the country with foreign goods; but, at the present time, so many people are out of work that we should try to assist them to obtain boots or shoes. A few days ago an honorable senator on the Opposition side said that some persons were so poor that they could not buy boots, even if the price were reduced. I am thankful to say that there are some members of the community who are still contributing to benevolent funds, and, if the price of boots were reduced, the money that is subscribed would go further than at present in meeting the needs of those who are now compelled to go without proper footwear. High wages are being paid to a certain section of the population, but boots are too dear for the poorer sections to buy.
– The honorable senator is rather good on a “ sob “ story.
– What I am saying cannot be contradicted. Even in Queensland, at the present time, there must be many who cannot afford to buy boots or shoes. Are we justified in maintaining exorbitant prices, and having thousands of people going about the streets in winter in boots and shoes that are not fit for them to wear?
– This matter has been investigated by the Tariff Board, whose report is dated the 17th June, 1930. Prom the 4th April, 1930, to the 2nd September, 1932, the goods covered by this item were subject to a special ad valorem duty of 50 per cent. Except with respect to the increase of 5 per cent, in the general rate, to give effect to the Ottawa agreement preferential formula, the rates now proposed are the same as those submitted by the previous Government. The duties on these goods formed the subject of inquiry by the board early in 1930, and it recommended a British duty of 45 per cent., or ls. 9d. each, and a general rate of 60 per cent., or 2s. -3d. each. The Government, however, considers that the proposed ad valorem rates would afford Australian manufacturers sufficient protection against importations of low-priced boots and shoes. At the time of the Board’s inquiry, the Australian production approximated 95 per cent, of our footwear requirements. In the opinion of the board, the development of this important industry, which affords direct employment for 17,000 or 18,000 persons, is a matter in which Australia can justly take pride. The success of the Australian manufacturers in obtaining control of the local market is largely due to the efficiency of our factories, and the keen internal competition that has always existed in the industry. Prior to the imposition of the special duty, which has since been lifted, the importations of boots and shoes approximated in value £250,000, and it is hoped that the increased rates will enable a substantial percentage of this trade to be transferred to Australian manufacturers.
Senator Duncan-Hughes has already anticipated what I had to say. with regard to the export trade. In the case of New Zealand, this trade has been increasing rapidly during the last few months, owing, as honorable senators are aware, to the fact that New Zealand is on an exchange parity with Australia. Our total export trade in 1931 amounted in value to £42,852, of which £29,000 worth went to New Zealand, and £3,846 worth to Dutch East Indies. The.Tariff Board, in its report, traced the increase of the British preferential rate from 30 per cent, in 1908-11 to 45 per cent, in November, 1929, and, referring to- the efficiency of the industry, remarked -
At the present time Australia is producing approximately 95 per cent, of its requirements in footwear, and those responsible for the development of the industry may well be proud of its progress. The process of obtaining control of the Australian market has been largely the result of the efficiency of our factories and the keen internal competition which has always characterized the industry.
There is no doubt that the tariff has assisted in building up this very important Australian industry. The duties imposed have not been so high as to be prohibitive, but have been so adjusted as to enable the local manufacturers successfully to compete with products imported from’ all parts of the world. The wisdom of this policy has been proved by the high standard of efficiency attained, and the fact that the industry has been built up without the aid of excessively high duties, has assisted the local manufacturers to gain the goodwill of the consuming public.
The quality of Australian footwear compares favorably with that of the imported, and in fashion footwear, the Australian manufacturers have kept right up to date. It is common knowledge that the boots supplied to the Australian Imperial Force- were unexcelled by those worn by any other troops during the war. At the Tariff Board’s inquiry it was mentioned that the members of the Mawson Antarctic Expedition were equipped with ski-ing boots manufactured in Australia - an indication that even in specialized work the quality of -Australian boots is satisfactory.
During the last few months, I have had occasion to note what the local industry is able to do, and I have been amazed at the efficiency of its production at a cost which compares favorably with that of a similar class of goods made overseas. Owing to a foot injury which I sustained in my youth, I require footwear made to special order. The upper part of my boots has to be made of kid, which, I understand, comes from Tibet; but their cost, made to order by a leading firm in Melbourne, was practically the same as I have had, to pay for boots of similar quality manufactured in London. The Tariff Board, in its report, dealt with the subject of the unemployment prevailing in the boot industry. We know that there has been a falling off in the demand for footwear. There was a flush of trade shortly after the war, and we were then exporting boots and shoes to South Af rica and New Zealand; but the subsequent drop in the export trade considerably affected the industry. In this connexion, the board stated -
Unfortunately the figures submitted at the inquiry make only too obvious the fact that unemployment is serious in this industry. The statistics prove that there are over 2,100 unemployed amongst the members of the Australian Boot Trade Employees Federation (which does not include Western Australian boot trade workers). In addition there are others who have left the industry to try and find employment in other trades, and whose names are not now on the rolls of the federation, whilst many are working short hours in order to distribute the work amongst more employees.
It is regrettable, but important, to note that, if imports were absolutely shut out and if Australian production to the same value replaced them, the most optimistic expectation places the additional hands that could possibly be employed at 900 (out of 2,100 unemployed). This result would only be attained if operatives continue (in some factories ) to work part-time to distribute employment. Actually, a ‘ very hopeful estimate of additional employment resulting from any one of the duty proposals under consideration, or any practicable scheme to increase Australian output, is 450 hands.
It is apparent, therefore, that the industry is over-manned and that many operatives must continue to look to other trades for employment.
The board mentions that the New Zealand market has absorbed a large proportion of the Australian output, and that during one year the footwear exported from Australia was valued at £880,000. The industry is likely to recover a certain amount of that trade; consequently, interference with the protection that the Tariff Board recommended should be given, would be ill advised. The object that the board had in view would appear to be stated in the following remarks on page 18 of its report :-
The board considers, that a slight increase in the ad valorem duty may have the effect of turning to the Australian manufacturers a further proportion of the importations of footwear, i.e., in addition to that portion to which the suggested fixed rates of ls. 9d., 2s. and 2s. 3d. will apply. The increases em- bodied in the November, 1929, tariff proposals would, in the opinion of the board, be sufficient to obtain for the Australian manufacturers just as much of this trade as they are ever likely to get, and, at the same time, they would inflict no undue hardship on the users of footwear of exclusive designs which it may not prove a commercial proposition to manufacture in Australia.
This appears to be a complete report on the industry, and in the light of it I must oppose the request.
– The speeches of the Minister and Senator Duncan-Hughes demonstrate clearly the tragedy of our modern economic system. That of Senator Duncan-Hughes, to my mind, illustrates the clear line of demarcation that exists between him and honorable senators who sit on this side.
– There is no doubt about that.
– The honorable gentleman spoke of the poverty of the people in Australia who cannot afford to buy boots, and advanced as a solution of that problem the reduction of the tariff, in order that the competition in the trade might be intensified. The Minister has shown that the local manufacturers produce practically 95 per cent. of the requirements of our people. Senator Duncan-Hughes would lower that percentage, and thus have thrown out of employment many operatives who are now on part time. Some time ago, Professor Copland made a speech in which he referred to the over-capitalization of industry in Australia. He said that many of our industries are over-capitalized and over-built, and that much labour has been wasted, and much money lost as. the result of the uneconomic methods adopted by a disorganized and anarchic system of society. He also made a statement that to me appeared so absurd that I called upon the manager of Whybrow’s, in Brisbane, to learn whether it was correct or not. He informed me that the statement was correct. There were 354 factories of a certain size in Australia, three of the largest of which, by the use of the machinery and labour at their command, could supply the whole of our requirements. Some years ago, the sons of Mr. Marshall, the eminent boot manufacturer, went to the United States of America, where they purchased machinery that they had shipped to Melbourne, in the belief that by its use they would capture the whole of the Australian market. I believe that that machinery is still in Melbourne.’ If it were fully operated, in conjunction with that of Whybrow’s, and another large firm, in six months the whole of our requirements could be produced. Senator DuncanHughes has read a pathetic letter, the like of which, probably, all honorable senators have received at different times. My wife and I, during the course of philanthropic work in Brisbane, have come in contact with hundreds of personsho are sho,rt.of boots. Yet we can produce all the hides and leather that we need, and if the machinery at our disposal, together with the labour power that is available, were utilized to the full, we could supply the requirements, not only of this country, but also of New Zealand, the Dutch East Indies, and other countries. The circumstances are such as to . make one pause to review the situation. My good friend, Senator Duncan-Hughes, pathetically states that if only we reduced the tariff there would be a possibility of . improving the position. How could it he improved if, by allowing boots to be imported, we were the means of throwing hundreds of persons out of work in Australia? Not only they, but also their wives and children, would suffer, and bur manufacturers would be severely handicapped. Honorable senators must have it firmly implanted in their minds that so tremendous is the development of productivity, that our troubles cannot be overcome by the temporary and trumpery method of tariff reduction: Only recently, I read a work entitled Slump, written by Mr. Thessall-Tiltman, a gentleman of’ high journalistic attainments, who went from one State to another inEurope examining the unemployment problem. In one section of his work, he refers to the great Bata factories of Zlin, in Czechoslovakia. Those factories, working ordinary time during a five-day week, produce no fewer than 1,000,000 pairs of boots a week, the highest price being 8s. 6d., and the lowest 10½d. a pair. A similar state of affairs exists in the United States of America, which in three months could produce the whole of the country’s requirements. Yet we talk of winning back our trade with other countries! The Minister has said that a few years ago the value of our exports of footwear was £800,000. How can we expect to recapture that trade ? Undoubtedly, a certain amount of trade benefit accrues to different countries as the result of the manipulation of exchange; but behind and below it all is the one big fact that legislators and rulers must get into their minds, namely, the terrific and intense development of modern production. I should like any honorable senator to prove to me how it is possible to solve that problem by a reduction of the tariff. I am acquainted with the trade in the Old Country, because my father was closely connected with it for 40 years, and know that it is impossible for us to obtain a footing in that market, because of the intense development that has taken place by the use of modern machinery. I realize what is happening in the. world; therefore, I stand for a tariff that will aid our internal development, aid our manufacturers, and aid our workers. But a solution of the economic problem will not be found in either the raising or the lowering of the tariff.
.- I do not think that this question need be laboured, because the imports of footwear have practically ceased. I understood the Minister to say that the Tariff Board reported in 1930 that local manufacturers were then supplying 95 per cent, of Australia’s requirements.. In that year, the imports were valued at £2,921 in the case of men’s, and £24,076 in the case of women’s and children’s footwear. But in the year 1931-32, those figures dropped to £1,155 and. £4,710 respectively. Therefore, practically the whole of the trade must now be held, by the local manufacturers, and it does not matter what tariff we impose. I endorse the remarks of the Minister concerning the price of locallymade footwear. Only a short while ago, I obtained prices in London, and found that they were just as high as those charged in Australia. I do not believe that there is any exploitation of the public by the manufacturers, but that on the contrary, the competition is so keen that the lowest prices possible are charged. From the figures quoted tonight, I am satisfied that there is a possibility of developing an export trade with countries such as New Zealand, where the exchange is on a parity with our own. Under the circumstances, the price of the local article is not likely to be affected,, nor will imports increase.
– I consider that no honorable senator is capable of refuting the argument advanced by Senator Brown. I am acquainted with many operatives in the boot trade, and know that there is an enormous number of surplus factories and that employment is more intermittent than in other occupations. Occasionally, there is rush and bustle, and the men have to work overtime to fulfil orders. Then, however, a slump ensues, and they are out of work for many weeks, and even months. Both the number of boot operatives and the number of factories are vastly in excess of Australia’s requirements. I was not aware that there were so many surplus factories, but, evidently, the statement made by Professor Copland was backed up by the manufacturer that Senator Brown consulted. This goes to show that the philanthropic idea voiced by Senator Duncan-Hughes would provide no remedy. If the effect of the lowering of the duty was to increase imports, the philanthropic organizations which the honorable senator so highly commended might be able to obtain boots more cheaply, and supply a greater number to the unemployed; but, on the other hand, many employees would have to work short time, or would be thrown out of employment altogether, and thus what might be saved in one direction would be lost in another. I am sure that, on reflection, Senator Duncan-Hughes will realize that his proposal merely skims the surface, and would have but ephemeral results. What we need to do is to provide the people with employment, so that they will not be dependent on charity, for their boots. I would rather walk barefoot than ask a charitable organization for a pair of boots. My feet would soon become calloused, as they did when I was a boy, when I detested having to wear boots. However, in many industries foot-covering is necessary to save the feet from mutiliation
It would appear from the figures that were quoted by the Minister that Australia supplies 95 per cent, of our requirements of boots and shoes; the remaining 5 per cent., apparently, represents highlypriced, freakish footwear from abroad. These duties will probably result in our manufacturers catering for even a greater proportion of the Australian market; therefore there is no reason why the. tariff should be disturbed. Certainly these high rates have not resulted in the exploitation of users of boots and shoes, as in recent years there has been a remarkable drop in the price of footwear, probably because of the intense competition of which we hear so much.
I agree with Senator Brown that no proposal, either for raising or lowering tariffs, can overcome the difficulties which are brought about under the existing economic system by anarchic methods of production. As soon as an industry begins to pay dividends a rush of capital is attracted to it; it produces a surplus which cannot- be absorbed, and there follow frantic efforts to dispose of the surplus. None of the proposals that have been advanced is more than a temporary palliative for existing evils; and, frequently, under the existing system, any good done in one direction is more than counteracted by the evils brought about in other, directions. The only remedy is the over-throwing of the present system and the substitution of production for use instead of for profit. Those honorable senators who have enjoyed a better education than I have had will probably remember the words with which Cato the Elder ended every speech, “ Celerum censeo Carthaginem esse delendam - “For the rest, I vote that Carthage must be destroyed.” I should be out of order if I 3aid more than- once each time I rose, “ There is no remedy for the existing trouble other than the destruction of capitalism.”
.- I express my delight at the moderation of the Government in connexion with this item. After the extraordinarily high tariffs that we have been discussing for hours, it is a relief to see a duty which, considering all the circumstances, is moderate. I could quite understand Senator Duncan-Hughes moving in the direction that he has, if his request were confined to goods worn by the majority of the people, especially the working classes.
My experience of the Australian boot and shoe industry has surprised me agreeably, for I have seen and appreciated the wonderful strides that it has made, and the variety and quality of its pro ducts, which are marketed at extremely reasonable prices. A few years ago the reverse was the case. Possibly our industry has progressed in this fashion as a result of the installation of up-to-date machinery, and the closer application of those concerned to the production of an article that suits the needs and means of the people. It is gratifying to me to know that to-day footwear is manufactured in Australia which is of excellent value’, and that all classes in the community are catered for; and I pay my tribute to those engaged in the industry. I am familiar with the prices charged for boots in Great Britain, the United States of America, and on the Continent, and I know that a close comparison favours the local product. Therefore, I am hopeful that the Australian industry will recapture the export trade that it enjoyed a few years ago, especially with the dominion of New Zealand.
– New Zealand is building up its own boot trade.
– Yet I am hopeful that we shall recapture it; we certainly shall if the industry continues to progress in the future as. it has done in the immediate past. Only a small proportion of our requirements is imported, and it comprises only higher grade boots and shoes which are beyond the reach of other than wealthy people. Until recently we were practically dependent upon imported slippers, but our. manufacturers now meet the demand for this class of footwear. I always desire to be fair, and although I am consistently opposed to prohibition, I recognize that in this case the duties are not prohibitive, except in regard to that class of shoe which is purchased onlyby the wealthy in the community. The poorer sections are excellently catered for by the Australian industry.
Senator DUNCAN-HUGHES (South Australia) [9.7J. - The Minister has admitted that this is a prohibitive duty, and, I think, quoted a Tariff Board report to that effect. As Senator Kingsmill pointed out, we are reaching the position when quite a number of Tariff Board reports declare that duties are prohibitive.
– What is wrong with that?
– It is contrary to the views which I placed before my constituents. However, I am aware that the Labour party stands for prohibitive duties. . The admission by the Tariff Board that this duty is in that category, the Minister ‘affords me. good reason for opposing it and questioning Senator Payne’s conclusion that the duty is quite reasonable.
– I did not say that it was reasonable.
– As a matter of fact, the Tariff Board report that was read by the Minister stated that this is not a prohibitive duty.
– I am sorry if I misrepresented the honorable senator, and, of course, I accept the correction of Senator Greene. . But certainly that declaration has been made in many other reports of the Tariff Board.
I have here two reports of the Tariff Board that were issued in 1930, one of which shows the falling . off that has occurred in our export trade, and reads -
In the board’s report on the necessity for increased rates of duty on boots and shoes, it is shown that the export trade in footwear has declined from £828,662 in . 1920 to £12,149 in 1928-29.
The other report states-
Taking all these things into consideration, the board considers that the outlook for an export trade is npt bright, and that Australian manufacturers can anticipate no substantial outlook other than the local market.
That confirms what I have stated on a number of occasions. There are about 14,000 persons employed in our boot industry, and I still suggest that, at present, it is not sound, politically or economically, to prevent a great number of persons from buying boots in order to ensure that those engaged in the industry shall be kept in full employment at a fairly high wage.
Senator Brown quoted Czechoslovakia, about which I did not say a word, nor did I make any suggestion that there should be any alteration in the general tariff, which would affect that country; so that his reference has nothing to do with the debate.
– The honorable senator was speaking of export trade, and I pointed out that there is one huge boot factory in Czechoslovakia. What hope have we of exporting against such competition ?
– There is also the matter of the export of boots and shoes from Czechoslovakia, which is mentioned in one of those Tariff Board reports. Since this country has been mentioned, I might inform Senator Brown that one of the chief causes of the main trouble in the east of Europe at the present time is the tariff barriers which have been raised in Austria, Hungary, Czechoslovakia, and Yugo slavia since the war. That part of the world may again landus in trouble, and, to alarge extent, it is these high tariff barriers between conflicting people who formerly belonged to the one empire that are causing the bother. Senator Brown attributes the trouble to our economic system. With that I cannotagree. If impossible burdens are placed on any system ; if, for example, you have artificial arbitration awards,’ the system cannot be blamed if, in a time of depression, it experiences difficulty in carrying on.
– It is suffering too much from socialism. That is what is killing it.
– I think that Senator Brennan has put his finger right on the trouble. It is the fact that we have had too much socialism that is making it so difficult for the machine to operate. I admit that other countries in the world are faced with difficulties, but, no doubt, they, too, are due to the spread of socialism all over the world. I think that, like other things that affect a consumer, what I have said about boots is a point of view which might reasonably be put. I even suggest that my argument in favour df giving the unfortunate a decent pair of boots has as much in its favour as had that to which we listened last night concerning the desirability of such persons going to the motion pictures.
Question - That the request (Senator Duncan-Hughes ) be agreed to - put. The committee divided. ( Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 7
Question so resolved in the negative.
Item agreed to.
Remainder of division, namely, items 331 (c) and 332 (b1), agreed to.
Division 13. - Paper and Stationery
Item 334, sub-items (l3) (m1) -
Paper, viz. -
(1) Glass paper and flint paper, irrespective of size and shape, ad valorem, British, 30 per cent.; general, 50 per cent.
Senator Sir WALTER KINGSMILL (Western Australia) [9.20]. - On this item the rates of duties have been increased from 3 per cent. to 30 per cent., and from 10 per cent. to 50 per cent. in the British and general tariffs respectively. These are enormous advances, and if the Minister would assure the committee that they are based on some system or reasoning, the information might be a guide to us in the consideration of later items.
– Sand paper, glass paper, and flint paper have been produced in Australia for some years, and are sold at prices which in most cases are below the prices of imported paper. Notwithstanding the lower prices, however, the sales of the local abrasive papers are small in comparison with the sales of importations. The failure of local manufacturers to obtain a greater share of the available market is due largely to the preference displayed by consumers for the imported article. The Tariff Board reported on this item on the 28th April, 1931, and a prominent witness, who tendered evidence against the application, which covered all abrasive papers, stated that tests of locally-made flint paper, glass paper, and sand paper had proved them to be entirely satisfactory, and the group he represented offered no opposition to the application for increased duties on those goods in sheets. Evidence was produced to the board that the local papers are being used by certain government and semi-government bodies as well as by private concerns. The estimated local requirement’s of the papers on which the increased duties are proposed is 15,000 reams, valued at £15,000 per annum. The whole of the raw materials used in the manufacture of these goods are the product of Australia, and it was stated by the applicants for increased duties that in the production of the estimated requirements of the Commonwealth, 75 tons of paper, 30 tons of glue, and 150 tons of glass would be used. Practically the whole of the competition comes from the United Kingdom where the manufacturers of abrasive papers are able to obtain their raw materials at more favorable prices.For example, the cost of Australian cake glue at the time of the inquiry was £65 a ton as against £40 a ton in the United Kingdom, whilst the price of paper in Australia was £42 10s. a ton as compared with £20 in Great Britain. The abradants used by the local company are ground and graded in its own complete self-contained reduction plant, which is designed for, and capable of, treating abradants other than those at present used, such as garnet, flint, and silica. As the selling prices of the Australian papers are lower than those of the imported papers, and the local manufacturers have given an assurance that prices will not be increased, it is unlikely that the increased duties would mean greater cost to users. The higher duties will assist the local manufacturers to break down the existing prejudice against the Australian article, and enable them to secure a much larger proportion of the trade.
.- I welcome the explanation given by the Minister (Senator McLachlan). This sub-item deals with materials that are the stock in trade of men engaged in the furniture trades. The Minister stated that, Australian-made glass paper had been. manufactured for some years, and had been offered for sale at a price lower than the British article, but that users preferred the latter. There must be some reason for this preference.
– The chairman of the Furniture and Allied Trades Section of the Victorian Chamber of Manufactures stated that he withdrew his opposition to the request for increased duty because of the excellent quality of the local article.
– But the Tariff Board has stated definitely that Austraiian users prefer the imported article, which is more expensive. What reason can be assigned for that preference?
SenatorRae. - Prejudice.
– No; the only possible explanation is that the users consider the imported paper the more serviceable. There has been an extraordinary increase in the use of glass or emery paper in Australia in the last few years. Until comparatively recently it was used chiefly for smoothing off timber; nowadays it is employed largely in connexion with modern machines for the surfacing of floors, and unless the paper is of the very best quality, it is not satisfactory. Those engaged in the trade have assured me that they are obliged to use a larger quantity of Australian-made glass paper to get the same results as can be obtained by the use of the imported paper. I am not saying this with the object of reflecting upon the Australian industry, because I am hopeful that our manufacturers will overcome their initial difficulties and eventually produce an article equal in every respect to the British product. In the meantime it is not fair to penalize those who use this material by compelling them to pay a high price. I accept the Minister’s statement that the local manufacturers have given an assurance that their prices will not be increased, and I emphasize the need for the production of an article of the very best quality in order to meet the needs of the trade.
– The Minister (Senator Mclachlan) has just told us that tests of locally-made glass or emery paper had been entirely satisfactory. I should like to know, first of all, who made the tests, and, secondly, to whom they proved entirely satisfactory. Obviously, they could not have proved satisfactory to those persons who desire to import, and increase the use of, British papers. Therefore, we must assume that they proved satisfactory to the Tariff Board or to those delegated by it to make the tests. We have been told also that local manufacturers have given an assurance that, if the market is secured to them, they will not increase their prices. That; recalls to mind the tendency there is among manufacturers of small lines to base their case for a complete monopoly of the Australian market upon an assurance that, if it is given to them, they will not increase prices to the users of their products. What they say - and I have had letters from them myself on this subject - is that they do not want to increase prices, but do want the Australian market. That means, of course, that they want a monopoly. Those who instituted our present system of protection, and those who have maintained it up to the present time, have constantly urged, until lately at all events, that there is a fundamental distinction between giving protection and giving a monopoly. The Minister also referred to the prejudice that exists against the use of the local article. We are constantly hearing complaints of that nature.
SenatorRae. - Prejudice against Australianmade articles is very real.
– I venture to say that there never was a greater chimera anywhere than this alleged prejudice against Australian-made articles. The facts are that purchasers know what they want. To use a simile employed the other evening by Senator Sampson, those who are under the harrow know exactly where the tine pricks. Persons who use the articles covered by this subitem know what they want; and acting upon this knowledge, by confining their attention to the best articles, eventually our manufacturers will be in a position to produce goods that will hold their own with the products of any other country. This granting of a monopoly, whether or not it goes by that name, will not, in the long run, benefit the local industry. I dissent althogether from the method adopted, apparently, by the Government in framing this tariff, of acting upon the principle that the fact that the local market has already been secured by Australian manufacturers, is justification for the imposition of exorbitantly high duties. To me it seems a justification for reducing duties in order to ease the situation a little, and, as provided in the Ottawa agreement, open the way for fair and reasonable competition. No one can suggest that an alteration of these duties from free British, and 10 per cent, general, to 30 per cent. British, and 50 per cent, general, will give British manufacturers a fair opportunity for reasonable competition. This may be only a small item in this amazing and complicated network which we are binding upon the necks of the people; but it discloses the principle upon which the tariff is being framed, and will result in further shackles being fastened upon the people of this country. The increase of duty is altogether without justification.
– I have already offered the explanation, given by the Tariff Board, for these higher duties. It is not often that the board expresses the opinion that there is prejudice against the use of the local article, but in this case it has mentioned the matter. Members of the board, which, in April, 1931, comprised Messrs. H. McConaghy (chairman), H. E. Guy, S. Berchdolt and W. S. Kelly, are more skilled in all the tricks of commerce than is either Senator Brennan or myself. That body examined a number of witnesses on oath, and it had a practical demonstration of the uses of the locally-produced article. This is what the board said about the subject -
The evidence indicates that in the past the selling prices of the local product have been under that of the imported . . .
Evidence as to the quality of their manufactures was submitted by the applicants. This shows that the local papers are being used with satisfaction by certain Government and semi-Government bodies, as well as by private concerns . . .
The chairman of the Furniture and Allied Trades Section of the Victorian Chamber of Manufactures, in evidence at the inquiry, stated that he offered no opposition to the application for increased duties on flint, glass and sand paper in sheets. Tests of the local , papers, he stated, had proved them to be entirely satis’factory.
The industry under review, in so far as it covers the manufacture of sand paper, glass paper, and flint paper, is one which, in the opinion of the board, is deserving of encouragement.
– If it is deserving of encouragement, it ought to get a protection of 10 per cent.
– I do not know whether honorable senators who are criticizing the item have read the Tariff Board’s report, and have considered the reputation of the men who gave evidence in support of, or in opposition to, increased duties. One of the latter was a furniture manufacturer of ChurchStreet Bridge, Chapel-street, South Yarra, who was also chairman of the Furniture and Allied Trades Section of the Victorian Chamber of Manufactures. The board heard both sides.. The local manufacturers were represented by -
James Francis Brereton Nicholson, prospective manufacturer of abrasive papers and cloths, Asquith, New South Wales.
Stanley Robert Mitchell, managing director, Australian Glass and Emery Paper Company Proprietary Limited, 22 Grosvenor-street, Abbotsford, Victoria, manufacturer of glass paper, flint paper, glassed straw.board, and of grain glass, flint and quartz.
The opponents of the application were -
Harry Goldman, furniture manufacturer, Church-street Bridge, Chapel-street, South Yarra; also chairman, Furniture and Allied Trades Section, Victorian Chamber of Manufactures, Melbourne.
Frederick Albert Daniel, attorney and representative of John Oakey and Sons, Limited, manufacturers of abrasive papers and cloths, London; also representing Australian Association of British Manufacturers.
Rubens Henry Knox, vice-president, and on behalf of Boot and Shoe Manufacturers Association, of Victoria, care of Mcllroy and Plowman Proprietary Limited, 163 Sackville-street, Collingwood, Victoria.
Maurice Charles Lloyd, director of Eliza Tinsley Proprietary Limited, distributor of surface abrasive materials, 044 Bourke-street, Melbourne.
Sidney Briggs, importers of abrasive papers as used by the hat trade, 306a Bourke-street, Melbourne.
All the witnesses were interested in the trade in one way or another. The board made a careful examination of the evidence, and reached the conclusions to which the Government is seeking to give effect in this schedule. The board was in the position of a jury. It weighed the evidence and endeavoured to mete out justice to both the Australian manufacturers and people. I therefore ask honorable senators to accept its recommendation.
– Senator Brennan said that there was no prejudice in these days against Australian goods, and that it was purely chimerical to say that such a prejudice existed. I respectfully disagree with the honorable gentleman. My experience has been lengthy if not as wide as that of some other honorable senators, and I know that until recent years there was a tremendous prejudice in Australia against Australian-made articles. No one can name the date on which the prejudice began to disappear. It may have been during the war years when it was proved beyond doubt that we were able to make many things which we formerly imported. Although the prejudice against Australianmade goods has lessened, it has not entirely disappeared. At one time, to brand an article “Australian-made “ was sufficient to condemn it as inferior. It was a common place, formerly, for business people to say, “ If we let people know that our goods are Australian-made they will refuse to buy them.”
– That was surely years ago.
– Not so many years ago. It is a regrettable fact that at one time certain storekeepers fostered the prejudice against Australian-made articles.
– In such cases it was not prejudice but dishonesty.
– By the dishonesty the prejudice was fostered. Business people were commonly accustomed to say in reply to requests for Australian-made goods, “Yes we have Australian-made articles, but they are of inferior quality.”
– A trade name has a great deal to do with the selling of an article. In the case of abrasive papers and cloths, Oakey’s is a world-famous name.
– That is true. Senator Brennan ‘ also said that in these days people know what they want and get it; but the foolish bargains that are made every day of the week indicate clearly that people do not- know what they want.
I believe that the sand paper and glass paper that are being made in Australia to-day can be favorably compared with the imported articles.
– I move -
That the House of Representatives be requested to make the duty, sub-item (All), ad valorem, British, 10 per cent.
I have listened to the Minister’s statement on this subject with great interest. For about eighteen years, I have had experience in the buying of sand paper and glass paper and of the use of it in factories. At Launceston, in Tasmania, we have a tennis racquet factory which is developing apace. In connexion with it, considerable quantities of sand paper and glass paper ,are used. Hockey sticks and other sporting goods are also made in the factory. Sand paper is widely used in these days in the dressing of timbers. The sand paper machines put a beautiful finish on timbers, broom handles, and tool handles of one kind . or another. I am prepared to admit that there has been a prejudice in this country against certain Australian products, but we must remember that for many years Great Britain has specialized in the manufacture of abrasive papers and cloths. A wide and wonderful range of these goods is being produced in Great Britain to-day. I know that people engaged in the furnishing and wood- working industries prefer to use abrasive papers and cloths made by a reputable firm, such, for instance, as Oakey’s The market for these goods in Australia is limited to about £15,000 per annum. If we persist in imposing heavy duties on these articles, we shall create a monopoly for a small Australian industry, and it will not be possible for us to get the wide range of cloths that are really necessary. In the light of the Ottawa agreement, it must be admitted that a duty of 30 per cent, on sand paper and glass paper is absolutely prohibitive, especially when it is considered in relation to exchange and primage. I hope that my request will be agreed to.
.- I support the request. The Australian industry engaged in the manufacture of abrasives was started at a time when British products of this kind were being admitted free. The’ intermediate and general rates of duty at that time were 5 per cent, and 10 per cent, respectively. Even under such conditions -the local industry was able to make headway. The only reason why it could not command the whole of the local market was that, according to some honorable senators, there was a prejudice against, local products. I was interested when the Minister mentioned that the Australian Glass and Emery Paper Company, of Abbotsford, Victoria, was manufacturing these articles in Australia. I should like to know whether this company is a subsidiary of the Australian Glass Company, which, as we know, has wide ramifications in this country. .A few days ago it was stated in the press that that company had made large profits from its subsidiary organizations. If the company manufacturing glass and emery paper is a subsidiary o’f the Australian Glass Company, it has, no doubt, contributed its share to the revenue of the parent company. A duty of 30 per cent, would give the local manufacturers practically a monopoly to the detriment of those engaged in the carpentry and joinery trade in particular, for they need to use abrasive papers and cloths every day. The duty of 10 per cent, proposed by Senator Sampson should give the local industry adequate protection.
– I remind honorable senators that the item now under consideration does not apply to emery paper, emery cloth, flint paper,, flint cloth, garnet paper, and garnet speed grits, but only to sand paper and glass paper. There appears to be some misapprehension about the conditions under which the manufacture of sand paper and glass paper was undertaken in Australia. According to the report of the Tariff Board, Mr. Nicholson intimated that he proposed to undertake the manufacture of these products, and to start with plant and machinery estimated to cost £7,000. The estimated outlay for working capital, land and buildings was £10,614. of which £6,000 was intended for buildings. He is prepared to spend £17,000 in establishing the business. Stanley Mitchell, managing director of the Australian Glass and Emery Paper Company, said that his company manufactured glass paper, flint paper, and glassed strawboard; also, grained glass, flint and quartz. Mr. Harry Goldman, appearing on behalf of the Victorian furniture manufacturers, in opposing the duties, stated that his association objected ‘ to the duties requested by J . F. B. Nicholson on emery paper, emery cloth, garnet paper, and garnet speed grits, as these papers were not yet produced iri Australia. Frederick Albert Daniel, as attorney and representative of John Oakey and Sons Limited, of London, took a number of points in opposition to the application, and these points were examined in detail by the board. Either we must accept the board’s recommendation, or we must go entirely contrary to it, and allow industry in this country to be dependent for its stability upon the action of Parliament, which may, with good reason or otherwise, alter the duties from time to time. The total importations of these articles, including sand, glass, and emery paper and cloth, amounted in 1929-30 to £83,205, while in 1931-32 they amounted to only £27,000. Of these importations, only .£15,000 worth are covered by the item in respect to which the honorable senator has moved his request. We must remember that manufacturers have invested their money in this enterprise. Whether they are a subsidiary of the Glass Company or not, they are deserving of justice. The board reported on the industry in 1931, and; on the strength of that report, and of the protection granted by the last Government and by this, the manufacturers began operations. Not the greatest quantity of importations come from the United Kingdom, as the following table shows : -
In 1930-31, £17,000 worth came from the United Kingdom, as against £14,000 worth from the United States of America, while, in 1931-32, nearly £10,000 worth was imported from the United States of America. If this industry, which has been spoken so well of by the Tariff Board, is, in accordance with the honorable senator’s proposal, denied a large part of the market formerly supplied by overseas manufacturers, it will be in a sorry plight, indeed.
Question - That the request (Senator Sampson’s) be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
– The “ Ayes “ and “ Noes “ being equal, I declare the question resolved in the negative.
Sub-items agreed to.
Item 338 (a) agreed to.
Item 340, sub-items (a) (b) (c) -
– The previous duties under this sub-item were - British 30 per cent., and general 40 per cent. These have now been increased to - British 45 per cent., and general 65 per cent. I should like the Minister to explain why the increases were made.
.- From the 4th of April, 1930, to the 2nd of September, 1932, the goods classifiable under this item were subject to the special duty of 50 per cent. Except for the increase of 10 per cent. in the general rate to give effect to the Ottawa agreement preference formula, the rates are the same as those imposed by the previous Government. The item covers manufactures of stationery and a number of office requisites, and articles of a similar nature. The duties under this sub-item were the subject of inquiry by the Tariff Board in 1930 in connexion with an application for increased duties on certain lines coming within the sub-item. Separate details of the imports and local production of many of the lines are not now available. The board in recommending the duties now proposed - except for the preferential formula adjustment - on many of the lines included in this subitem, suggested that the item should be subdivided so that certain lines, which were not being produced extensively in Australia, might be exempted from the higher duties. That suggestion was considered, but it was feared that its adoption would lead to administrative difficulties. The Government therefore decided to apply the increased duties to all the lines formerly included in the item.
– I thank the Minister for his explanation, but I am not prepared to allow this item to remain as it is just because administrative difficulties might be met if the Government adopted the suggestion of the Tariff Board. After all, difficulties are made to be overcome. Why should certain items, which should come under low rates of duty, be included with other items subject to higher rates of duty? Surely we should exercise discrimination in tariff-making, and not group together a number of items, some of which should be subject to duties lower than those applying to others.
– The honorable senator has already accepted that position.
– I have not. There are certain articles included under this item, which, I am sure the Minister will agree, are subject to duties which are far too high. In fact, many of these articles do not come into actual competition with local industries at all.
SenatorMcLachlan. - Has the honorable senator any particular articles in mind ?
– Take, for instance, inkwells, memorandum slates and tablets, sealing and bottling wax, and writing cases, in respect of which there is no extensive manufacture in Australia. I regret that the item has not been inquired into more carefully. The two classes of goods should be under separate sub-items bearing different rates of duty. This extraordinary method of overcoming a difficulty of administration throws an additional burden upon the people of Australia. I move -
That the House of Representatives be requested to make the duty, sub-item (a), ad valorem, British, 30 per cent.
Question - That the request be agreed to - put. The committee divided. (Chairman - Senator the Hon. Herbert Hays.)
Majority . . . . 1
Question so resolved in the affirmative.
Request agreed to.
Sub-items agreed to, subject to a request.
Division 14. - Vehicles
Items 355 and 357 (b) agreed to.
Item 359, sub-items (b1) (f3, 5) (gl)-
Vehicle parts, viz.: - (f)(3) . . .
Handles of all types for motor car doors, each, British, 4d. ; general, 9d. ; or ad valorem, British, 40 per cent.; general, 60 per cent.; whichever rate returns the higher duty.
.- I move-
That the House of Representatives be requested to amend sub-item (f), paragraph5, to read - “ (5) Handles of all types for motor car doors and for motor car window regulators, each, British, 4d.; general, 9d.; or ad valorem, British 40 per cent.; general, 60 per cent; whichever rate returns the higher duty.”
This amendment provides for the inclusion in the item, of handles for window regulators which are similar to motor car door handles and manufactured by identical processes. The prices are much the same, and the handles are required in designs to match the door handles. Window regulators are at present dutiable at alternative rates, and when the fixed rate applies the handles are charged a proportion of such fixed rate. Difficulty has arisen in determining the duty which is chargeable, and apart from the fact that the Tariff Board has recommended this alteration it is desirable from an administrative view-point.
Request agreed to.
– The duties on springs for motor cars and chassis covered by sub-itemg1 are British 4d. and general 5d. per lb., or ad valorem duty 45 per cent. on springs, respectively, whichever rate returns the higher duty. Why is the British ad valorem duty 45 per cent. on springs, and only 40 per cent. on handles for motor car doors? The flat rate is the same in each case.
– The duties on motor car springs were considered by the Tariff Board in February, 1930. These duties are the same as those imposed by the
Scullin tariff, and supported by tie Tariff Board. The special duty has been removed. Prior to the imposition of these duties, Australian spring manufacturers were supplying approximately 90 per cent, of the trade in replacement springs. They had the ability to manufacture springs for original equipment, but the low duties on original equipment springs imported with chassis precluded them from breaking into that trade. Under the 1930-31 tariff, the duties on springs imported with chassis were: If imported with unassembled chassis, British free, and general 17$ per cent. ; or, if imported with assembled chassis,. 5 per cent, and 20 per cent, respectively. Springs imported separately were subject to duties of British 40 per cent., and general 55 per cent. In normal times a considerable number of chassis is imported, and should local manufacturers obtain the orders .for the manufacture of the springs for them it is estimated that over 500 additional springmaker could be employed, and that men would also be required to produce the 7,500 tons of special alloy steel which would be used in their manufacture. Since the establishment of the springmaking industry in Australia, the price of springs has fallen. At the time of the board’s inquiry in February, 1930, the price per lb: was only slightly more than half what it was prior ‘to the commencement of production locally. The additional trade which should accrue from these duties will tend to reduce prices still further. In evidence before the board, it was stated that springs for Ford motor cars cost more in New. Zealand, where the duty on them was 20- per cent., than in Australia, under a duty of 55 per cent. Two of the leading spring manufacturers in Australia have undertaken to fix a uniform price in all States, and consequently users of motor cars in Western Australia will suffer no disadvantage in regard to freight charges from the eastern States. The duties in the schedule were recommended by the Tariff Board as deferred duties; but, owing to the fact that at the time of the board’s inquiry there were approximately four months’ requirements of motor cars in bond, there was no occasion to propose a deferred duty. The Tariff Board has recently reviewed all the reports sub- mitted by it during the past three years, and it now states that it does not consider that any review of its recommendations on these goods, in order to comply with the Ottawa agreement, is necessary. Prior to the operation of these duties, all original equipment springs were imported; but practically all the new cars now being sold are being equipped with Australian-made springs manufactured from Australian-made steel.
– The Minister’s statement is entirely satisfactory. I am not opposing the flat, rate of 4d. per lb. on springs imported from Britain, but I desire to make the ad valorem duty the same as on handles for motor car doors, namely, 40 per centWhy should the ad valorem duty not be the- same in each instance ?
– The ad valorem duties on springs are the same as on gears for motor vehicles covered by a previous sub-item.
Sub-items agreed to subject to a request.
Division 16- Miscellaneous.
Items 357 (c), 376 (aI, 2), and 390 (a”1, 2) agreed to. …
Item 392, sub-items (e) (f1, 2) (Jute, hemp, flax).
– The ad valorem duty on’ jute is British 30 per cent., and general 45 per cent., whereas the rates under the 1921-30 tariff were, respectively, 10 per cent, and 20 per cent. Jute is not produced in Australia, and, therefore, I should like to know the reason for these, increased duties.
– The duties on jute are now before the Tariff Board for consideration. The rates set out in the schedule are in accordance with the Tariff Board’s recommendation submitted in 1930, as well as with the proposals of the previous Government. The board stated in its report that it was satisfied that the local manufacturers were producing excellent’ yarn in efficiently conducted factories, and’ that the proposed duties were necessary in order to enable local manufacturers to compete successfully with manufacturers overseas. Australian cordage manufapturers who used Australian spun yarn were at a disadvantage when competing against others who manufactured their cordages from imported yarn. There is no reason why Australian yarn should not be used. Australian manufacturers have given an undertaking not to increase prices except on account of any increase in the cost of raw materials, and also to reduce prices to the extent of any fall in the cost of raw materials. The question of the necessity for these duties is at present under reference to the. Tariff Board in connexion with article 10 of the United Kingdom-Australia trade agreement.
– Sub-item 424 b refers to “ vessels, n.e.i., trading intra-state or interstate for any continuous period of three months or otherwise employed in Australian waters for any continuous period of three months”, and the ad valorem duties applying to vessels not exceeding 500 tons gross register are’ 50 per cent. British and 70 per cent. general. I notice that the rates obtaining under the 1921-30 tariff have been doubled. Is there any justification for this enormous increase?
.- This matter was referred to the Tariff Board on the 19th January last, but the last report which has been received from the board is dated August, 1926. The board then stated that these duties were necessary to bring the cost of wages and materials in line with overseas costs. It was established at the inquiry that labour costs and costs of material were considerably higher in Australia than in the United Kingdom. Labour is a big feature in ship-building costs, and at the time of the board’s inquiry it was estimated that labour and overhead charges represented approximately 60 per cent. of the total cost of a vessel. This item is, therefore, of considerable importance from the aspect of employment. There is enough efficient labour available in Australia to man the yards of the local companies, and the quality of the Australian built vessels compares most favorably with that of those constructed overseas. As the board has not reported on these duties since 1926, the matter has again been referred to it. The Government intends to adhere to the present duties in view of the board’s recommendation; but should the board, after its next inquiry, recommend an alteration of. the duties, the Government will submit the matter to Parliament at the first opportunity.
– Can the Minister say whether the board recommended a British duty of 50 per cent. or 25 per cent.? The rate until 1930 was 25 per cent.
– My recollection of the matter is that the Bruce-Page Government considered that the rates recommended by the board were too high.
Sub-items agreed to.
Items 419 (a) (cl, 2), 420, 424 (b1) and 432 (a) (b) agreed to.
Motion (by Senator McLachlan) proposed -
That the consideration of the remaining items other than those included in group 5 of the Customs Tariff Groups Memorandum be postponed until after the consideration of the items specified in group 5.
– I have no doubt that the Government has considered the matter of pushing on with the consideration of the tariff schedule, but I protest against going any further with it to-night.
– We have had a 12-hours day.
– Yes. I have sat in this chamber attentively from the time when the sitting commenced until now, but I submit that we cannot give proper consideration to the multifarious items in the schedule unless we have a reasonable amount of relaxation. Senator Payne, Senator Duncan-Hughes, and I began the day with extra parliamentary duties at half-past nine o’clock this morning.
– I hope that the Government will not take any notice of the remarks of Senator Brennan. We have got well into our stride with the tariff, and it is time we tried to make progress with it. In my opinion, we might well continue the work for a further period tonight. Some time ago, I was told that it was hoped to complete the consideration of the tariff within a few weeks; but, judging by the present rate of progress, we may take months to finish it.
– The motion that I have submitted is purely formal, and I hardly think that this discussion is relevant.
– I endorse the remarks of Senator Brennan. When, several weeks ago, the question arose of increasing the number of sitting days from three -to four, I said that I was in favour of the proposal but that I trusted that the Government would not ask honorable senators to sit late at night. Yesterday, the sitting extended from 2.30 p.m. to 11.10 p.m. As Senator Brennan has stated, a meeting of at least one Senate committee was called for 9.30 a.m. to-day; and we have also sat continuously since 11 a.m., with breaks only for meals. The same thing applies to the officials of the Senate, the Hansard staff, and the press. I can see no justification whatever foi sitting any later. We have before us weeks, if necessary, in which we may deal with the tariff in the greatest detail. The people are following our discussions, and they have no more desire than I have that the business should be rushed through at such a speed that honorable senators cannot keep pace with what is being done. This is the third week in which there have been four sitting days, and 1 suggest to the Government that it is only reasonable to realize that, during the last few days, the sittings have been long. The temper of honorable senators has been admirable; there have been none of those irritating scenes which sometimes arise even in this ancient chamber; but I am not certain of what may happen if tempers are pressed too far.
– On a point of order, I suggest that this discussion has no reference whatever to the motion that I have moved. If that motion were carried, honorable senators would learn what action I propose to take.
– I consider this the most suitable occasion for the discussion that has so far taken place, It would be decidedly out of order on any item of the schedule.
– I am surely in order in suggesting that we should not proceed with group 5 to-night. I hope that the Government will realize that so far we have dealt in a reasonable manner with the schedule, and that it is not fair to keep us here any longer.
– If the Minister would indicate at what hour he proposes to adjourn, the difficulty would be overcome.
– That is an excellent suggestion. I merely wish this formal motion to be carried, so that we may make a commencement with group 5. It was my intention to move that progress be reported when the first debatable item was reached; and in any event, I did not propose to sit beyond 11 o’clock. I point out to honorable senators that yesterday morning a couple of hours were taken off which have not been picked up.
Motion agreed to.
Group 5. - Amendments made by the present Government which are supported by Tariff Board reports.
Division 4. - Agricultural Products and Groceries.
Items 44 (e) and 64 (a) agreed to.
Item 73, sub-items (aI, 2) (bI, 2) (el, 2) (d) (Matches and vestas of all kinds).
– I wish to be supplied with information concerning this item, which has aroused a good deal of controversy. Has the Government acted upon the recommendation of the Tariff Board ?
– I assure the honorable senator that substantially it has done so.
– The duties on matches have been altered, compared with the 1921-30 tariff. On what ground has that alteration been made ?
– I wish to submit a request on this item, but should like the Minister to report progress at this stage so that I may have a chance to frame it.
– I hoped first to get beyond this inflammable subject.
Senate adjourned at 10.51 cm.
Cite as: Australia, Senate, Debates, 29 June 1933, viewed 22 October 2017, <http://historichansard.net/senate/1933/19330629_senate_13_140/>.