Senate
8 April 1948

18th Parliament · 1st Session



The President (Senator the Hon. Gordon Brown) took the chair at 3 p.m., - and read prayers.

page 647

QUESTION

THE PARLIAMENT

Reflections on Honorable Senators - Taxation of Members’ Earnings.

Senator SANDFORD:
VICTORIA

– Is the Leader of the Senate aware that a grave reflection was cast upon unspecified members of this chamber by the Leader of the Opposition in the House of Representatives (Mir. Menzies) when, addressing a meeting in Sydney, he was reported to have said, among other things -

You should see .some of the men we get in the Senate.

Does the Government rate the right honorable gentleman’s judgment as. high as he himself rates it? Can the Government ascertain whether he included members of the Opposition in his criticism? Is his criticism of the people’s choice of senators based on mental or physical grounds ; and, .if so, has he set himself up as a model? Is the Government aware that his inflated opinion of himself is not shared by members of his own party in New South “Wales, who, during the last State elections there, told’ him that he was not wanted?

Senator ASHLEY:
Minister for Shipping and Fuel · NEW SOUTH WALES · ALP

– Obviously, I am not in a position to answer the questions raised by the honorable senator. I recall having read a report of the statement to which he refers. “With respect to political propaganda, I have never known Oppo:sition parties to be so generous to the government of the day as have Labour oppositions. However, when we were in opposition we were just as critical of the Government as is the present Opposition. I am not prepared to pass judgment on the. opinion expressed by the Leader of the Opposition in the House of Representatives. I am afraid that I cannot enlighten the honorable senator further.

Senator AYLETT:
TASMANIA

– As it is well known that certain Liberal party mem-‘ bers of State Parliaments have been employed by the private banks at the rate of £12 a week to write propaganda against the nationalization of banking, the Labour Government, and .the Labour party, 1 ask the Minister representing the Treasurer whether -these additional earnings are subject to income tax?

Senator ASHLEY:

– One has to be a student of- taxation to understand it’s full ramifications, and I am not aware of the practice that is followed in cases such as that mentioned by the honorable senator. However, I assume that any member of Parliament who earns money in addition to hia parliamentary allowance will be taxed on his total income. This could be avoided- only if the extra earnings were paid m the form of a tax-free allowance. I am confident that the task of catching up with taxpayers can )>e left to the taxa-tion authorities. They do .not seem itf. miss very many.

page 648

QUESTION

ROYAL AUSTRALIAN NAVY

Uniforms

Senator LAMP:
TASMANIA

– During last session I raised the matter of supplying uptodate uniforms to ratings in the Royal Australian Navy. Can the Minister representing the Minister for the Navy say whether any progress has been made in that respect?

Senator McKENNA:
Minister for Health · TASMANIA · ALP

– At the moment I am not in a position to. supply the information sought by the honorable senator, but I shall obtain it for him as soon as possible.

page 648

QUESTION

SOCIAL SERVICES

Means Test: Effect of Superannuation Payments - Hospital Benefits - Age and Invalid Pensions

Senator FRASER:
WESTERN AUSTRALIA

– Will the Minister for Health and Social Services outline what is being done to ameliorate the means tot in respect of increased superannuation benefits payable to members of the Commonwealth Public Service? Is the Government aware that superannuation benefits payable to members .of the State Public Service in Western Australia have been increased by 25 per cent;, but that recipients on the lower ranges of incomes have really gained no additional benefit from this action because of the application of the means test in respect of social services’? Will the Minister outline what consideration has been given to the amelioration of the means test with a view to ensuring to public servants on the lower ranges of incomes the full benefit of increases of superannuation benefits?

Senator McKENNA:
ALP

– Honorable senators will remember that in June last a measure .was’ introduced which made several vital changes in the superannuation benefits available up till that date to members of the Commonwealth Public Service. The pension unit was raised from 10s. to 12s. 6d., an increase of 25 per cent. At the same time, whereas prior to that the contributions were made on a 50-50 basis, the Government providing 50 per cent, of the” superannuation fund ana the employees contributing the remaining 50 per cent., from June last, when the bill was passed, the contribution was altered so that the Commonwealth provided 60 per cent, and the employees found only 40 per cent. The third outstanding feature of the new scheme was that the maximum number of units that might be taken was raised from sixteen to 26. In terms of cash, that means that whereas previously the maximum which any employee in the service might draw upon retirement was £416 per annum, to-day it is £845 per annum. On the death’ of a retired public servant, if he is survived by a wife, she would receive half of the amount payable. In addition, a paymen of five shillings a week is made in respect of each child under sixteen years of age.

That movement was inspired by the need for meeting the fierce competition for personnel that was taking place between government departments and outside industries. The Public Service Board found that very excellent security and superannuation schemes were being provided for employees in private enterprise. The board believed that if it was to acquire the proper types of public servants it should provide them with adequate security. It is true that to-day, as the result of the Labour Government’s activities in the social service field, everybody in this country is keenly alive to the need for ultimate security. That permeates all industry to-day. So, the Government found the need, first, to attract the proper types to its service - and there is no more important work than doing the work of this country - and, secondly, the need to retain trained personnel. Honorable senators will remember that not long ago we lost the services of some distinguished public servants, for instance, Mr. A. V. Smith and Mr. Daniel McVey, and many others whose names they will readily recall. I should add that when the pension unit was increased from 10s. to 12s. 6d., the increase was provided not only in prospect for those who would ultimately receive the pension, but was made available also to persons who had already retired and were enjoying their superannuation benefits.

I did not know that the Government of Western Australia had embarked upon a similar procedure by raising superannuation benefits in that State by 25 per cent. In doing that, the Government of “Western Australia is no doubt following the very worthy lead set by this Government. ] understand that that example is being followed by other States as well as Western Australia. With regard to the means test and its abolition or amelioration, the Senate will recall that in August, 1946, the permissible income limit was raised from 12s. 6d. a week to £1 a week. That means that in the case of a man and wife, both of pensionable age, £2 a week can be drawn from, say, a superannuation fund in addition to a combined pension of £3 15s. a week. Thus, they are in the comparatively favorable position of having a total income of £5 15s. a week between them in their old age. That is more than the basic wage in any of the capital cities, and of course the recipients are without the responsibility of the basic wage worker. The policy of the Government is the gradual amelioration of the means test with a view to its ultimate elimination. This matter is being given constant consideration in the light of the existing financial situation.

Senator TANGNEY:
WESTERN AUSTRALIA

– Can the Minister for Health inform the Senate what progress has been made by the Government in its negotiations with the States to apply the Commonwealth hospital benefits scheme to patients in mental hospitals so that the payment of fees for treatment will not be a charge upon the relatives or the estates of the patients?

Senator McKENNA:

– At the last conference of Commonwealth and State Health Ministers, I requested on behalf of the Commonwealth Government that the State Ministers supply data regarding the sum of money collected annually by them from patients in mental institutions and their relatives. That information took some time to be collated and passed on to the Commonwealth. The matter is primarily one for the Treasurer because it is purely a financial arrangement between the Commonwealth and the States, lt would appear, however, that the amount that normally is collected from patients and their relatives is approximately £300,000 per annum. Recently. I was able to place a submission before Cabinet, and I have received authority to negotiate with the various States on the basis that the States might relieve the patients and their relatives altogether of such payments in consideration for certain grants that the Commonwealth would make directly to the States. There is to be a conference of’ health officers in Melbourne in a few days on the subject of tuberculosis. That will be followed shortly by a conference of Health Ministers ‘on sundry questions, and I expect the details of this proposition to be settled at that meeting.

Senator FINLAY:
SOUTH AUSTRALIA

– I ask the Minister for Social Services whether it is a fact that a person owning a home valued at say £2,000, residing in the dwelling, and sub-letting portion of it for £2 a week can also draw a full pension, provided his bank balance does not exceed the limits specified in the pensions legislation? Is it also a fact that another person with £2,000 invested in security loans and reviving a return of £62 a year would be ineligible for any portion of the age pension? If the answer to each question is in the affirmative, will the Government give sympathetic consideration in the near future to making provision for persons in the latter category which would enable them to receive the same benefits in respect of pensions as those enjoyed by the first class of persons?

Senator McKENNA:
TASMANIA · ALP

– The position has been stated accurately by the honorable senator. I agree that in the first case he posed, a pensioner would not be affected because he owned a home worth £2,000 and derived from it a maximum income of £2 a week. I qualify that statement by saying that this would be true only in the event of his having a wife of pensionable age who was also in receipt of a pension. The principle has been accepted by government after government - in fact I think it has obtained almost throughout the existence of pen sions legislation - that the home in which a person resides, and the furniture in that home, are ignored in calculating the value of his property for the purpose of the property test. There are uniform provisions in the act dealing with the income test as applied to pensioners and applicants for pension. As the honorable senator knows, the Government is continually reviewing the pension field. It has been very active in this regard and, as I explained earlier, is all the time giving consideration to possible ameliorations of the means test. Consideration will be given to the point raised by the honorable senator but, of course, as long as any arbitrary line is drawn in relation to property or income, there will always be anomalies and border-line cases. One must remember, in dealing with the present pension field, that very few pensioners have income of any kind and that comparatively few of them have property of any sort. A survey which I had made recently disclosed the rather significant fact that 65 per cent, of the total number of pensioners are without income, property or earning capacity of any kind. That represents a very large number, considering that there are altogether about 300,000 pensioners in this country. An additional 15 per cent, of pensioners have an income of 5s. a week or less. I point out to the honorable senator that, no matter what might be done in amelioration of the means test, no relief would be given to at least 80 per cent, of the pensioners in the pension field. Having regard to ordinary humane considerations, this fact causes me a great deal of concern. I have often expressed the view both here and elsewhere that, before people with reasonably adequate means are brought into the pension field, something substantial should first be done for 80 per cent, of the persons already receiving pensions who are almost without property, certainly without income, and very largely without earning capacity. However, I assure the honorable senator that full .consideration will be given to his suggestion later in the year.

Senator CRITCHLEY:
SOUTH AUSTRALIA

– I know of many cases of children of the age of 16 years who, although they are chronic invalids, are ineligible to receive an invalid pension until they attain the age of 18 years. “Will the Minister for Social Services consider recommending to the Government a revision of the Act in order that invalid children under sixteen years of age shall be eligible to receive a pension ?

Senator McKENNA:

– Until recently the eligibility of any invalid child who applied for a pension was determined according to his parents’ means. I think that I mentioned to the Senate some time ago, as an instance of the hardship caused by the rule, that a “child” of approximately 50 years was deprived of a pension because his mother was in receipt of an income of £400 per annum. I mentioned that case to other members of the Government in urging that the rule should be revised. The Cabinet decided that it was not in accordance with the dignity of an adult person that he should be made dependent upon his relatives, and the provision with regard to invalid “ children “, no longer applies except in the case of ininors. So far as invalid minors are concerned, the Government believes that their families have a moral responsibility to maintain them. However, any hardship which might be caused by the Government’s decision is more than offset by the adoption of a liberal scale of permissible income of parents of invalid children. From recollection, I believe that an income of £2 10s. a week is allowed for each member in assessing the eligibility of a family to receive payment of an invalid pension in respect of an invalid child. In. the case of a husband, wife and invalid child, the family would have to receive a total weekly income of £7 10s. or more before they would be ineligible to receive some portion of a pension in respect of the child. I can assure the honorable senator that this matter has received sympathetic consideration by the Government. Representations have been made on the point on a number of occasions, and I point out that the Government ha,s already gone 90 per cent, of the way in overcoming any hardship.

page 651

QUESTION

BAW RAYON

Senator ARNOLD:
NEW SOUTH WALES

– In view of the importance- of raw rayon to Australia and as the lack of this material is continually hampering industry in this country, will the Minister for Supply and Development give consideration to the setting up in Australia of a governmentowned and financed raw rayon industry to carry out the work that private enterprise has, so far, failed to do?

Senator ARMSTRONG:
Minister for Supply and Development · NEW SOUTH WALES · ALP

– The Government appreciates the importance of raw rayon in this country. In relation to this commodity, as well as to many others, there is an obligation upon us to make certain that production shall be undertaken within this country so that we may eventually become independent of outside supplies. Consideration has been given from time to time by my Department to this matter. I shall certainly take it up again at the honorable senator’s request and give consideration to the setting up of a government-controlled industry if private enterprise is not able to supply the need for raw rayon.

page 651

QUESTION

COTTON THREAD

Senator RANKIN:
QUEENSLAND

– Is the Minister for Trade and Customs aware that there is an acute shortage of sewing thread, particularly white thread, in Australia? If so, what action is being taken to overcome this shortage ? Is Australia entirely dependent upon imports for the supply of this commodity, and is an import licence required?

Senator COURTICE:
Minister for Trade and Customs · QUEENSLAND · ALP

– The Government is aware that there is a serious shortage of cotton thread in Australia and is making every effort to overtake the leeway. It is endeavouring to import the thread from various countries, and I am sure that the present shortage will be overcome soon. A licence is required for the importation of cotton.

page 651

QUESTION

RAIL TRANSPORT

STANDARDIZATION of Gauges.

Senator FRASER:

– In view of the declaration by the Premier of Western Australia in regard to his Government’s acceptance of the plan for the standardization of railway gauges, I should like to know how far the survey had proceeded prior to that acceptance, and also the cost of that survey.

Sena tor ARMSTRONG. - I shall bring the honorable senator’s questions to the notice of the Minister for Transport, and in due course an answer will be supplied to the “honorable ‘senator.

page 652

QUESTION

FOOD FOE BRITAIN

Postage on Parcels.

Senator COOPER:
QUEENSLAND

– I have received a communication from the secretary of the Diggers’ Association of Queensland informing me that he has received advice from the British Postmaster-General that the (postage rates on gift food parcels sent from Australia to the ‘United Kingdom, are fixed “by the Australian Postal Department. In these circumstances, will the Postmaster-General give early consideration to a reduction of the rates ?

Senator CAMERON:
Postmaster-General · VICTORIA · ALP

– The position as stated by the honrable senator is not quite correct. Actually the mates are fixed ‘by agreement with the British Postal authorities. Several requests have been made to the British Postal Department for a -review of -the -position .with the .object of reducing the charges, but, on. each occasion the answer has, been that the British authorities regretfully could not see their way clear to gi:an.t any decrease at present.

page 652

QUESTION

SUGAR

Senator KATZ:
VICTORIA

– Thousands of housewives in Victoria are handicapped by the fact that, owing to the sugar shortage, it is impossible for them to take advantage of the present seasonal opportunity to make preserves and jams. Therefore I ask the Minister for Trade. and .Customs whether, in view of the impossibility of obtaining adequate supplies of sugar in Victoria, the Government will consider taking over the sugar industry in order that supplies may be made available to the housewives of that State.

Senator COURTICE:
ALP

– I answered a question on this subject yesterday. However, I have not given any consideration to the possibility of the Government taking over the whole of the sugar industry. I do not know whether the honorable senator realizes the magnitude of such a task. The Government has not considered any proposal of this sort, and, even if it had, I doubt whether it could obtain any better results than are now obtained by the industry. So far as a large section .of :the sugar-growing and refining industry ;is concerned, there has been no hold-up in ‘Queensland for many years. ‘Only throUgh drought .and other adverse seasonal conditions has there’ been amy reduction of pr.oduct.ipn. The .provision of adequate .supplies of refined sugar for the people is a very important matter. The Government .considers that it has a responsibility to ensure ;that every Australian industry supplies .the people with .its products. There have been shortages of refined sugar in various parts of the Commonwealth for a long period. I .oo.fl.ld be eloquent about the seasons for the shortages, but I do not think that my eloquence would serve. any good purpose at the moment. I merely .say that we have ample Eefi.nd.ng capacity to provide Australian consumers with -all the sugar that they require for use both in the home and -in -industry. However., the sugar industry, in common with other industries such , as coal-mining .and shipping, is adjected by current events. I shall ,not refer at length to the industrial difficulties that have affected this country as well as other countries, but they have had a serious effect on the production and distribution of sugar. For instance, despite the efforts of ‘the Minister for Shipping and Fuel to ensure adequate supplies of coa’l to all industries, the refineries have not been able to secure sufficient stocks and, unless they can do so, they cannot produce enough sugar to meet demands. Furthermore, even when sufficient sugar is refined, the shortage must continue unless ships are available to transport it to the places where it is needed. A large volume of raw sugar is at present waiting to be refined in Queensland. I am sure that, when things settle down a little in the industrial field, the requirements of the people will be satisfied. As I have said here and elsewhere, the working people of Australia produce the things that we need. If there is any interruption of the continuity of production, then the people must go short of certain commodities. Persons engaged in the sugar industry have always realized their responsibility to the Australian people. They are in a position to satisfy the demand for their product and, under normal conditions, they will provide the people with all the sugar that theyrequire. Iassure the honorable . senator that both the AustralianGovernment and theGovernment of Queensland will doeverything in their power to cope with amy situation that may cause interference with the production . anddistribution of sugar.

page 653

COMMUNISM

Postal Department

SenatorO’SULLIVAN.-Has the Postmaster-General read, or been otherwise informed of, the report which appeared in the Standard Weekly, the official organ of the Australian Labour party, of the 2nd April, 1948, of the proceedings of the Easter conference of the Victorian Branch of the Australian Labour party? Is the Minister aware that the report referred to contains the following statement : -

Mr. Ward added that he wanted to inform the Postmaster-General, Senator Cameron, that there was a Communist cell within Ms Department. In the event of a war Senator Cameron might find some of his communications not too good.

In view of that report will the PostmasterGeneral inform the Senate what actionhehastakenor proposes to take in order to safeguard the security of communications ?

Senator CAMERON:
ALP

– I have read the report to which the honorable senator has referred. The day after the statement was made I issued instructions for immediate inquiries to be made into the allegations. I understand that the inquiries have now been concluded, but I have not yet been furnished with the report.

page 653

INSULATORS

SenatorO’BYRNE. - Is the Minister for Supply and Development aware that an acute shortage of high tension insulators in Tasmaniais delaying the extension of electricity to saw-mills, farms and homes in Tasmania ? Will the Minister inquire into the possibility of obtaining insulators from New Zealand, where, I understand they are available? Sailing that, will he inquire into the possibility of. manufacturing insulators in Australia ?

Senator ARMSTRONG:
ALP

-I shall certainly investigate the matter.I assure the honorable Senator that if the Department of . Supply and Development can assist inmaking insulators available it. will certainly do so.

page 653

QUESTION

SHIPPING

Port Delays

Senator O’SULLIVAN:
QUEENSLAND

asked the Minister for Shipping andFuel, upon notice -

  1. Is the report correct that the despatch to Britain from Queensland of approximately £1 0,000,000 worth of surplus primary products, including foodstuffs to the ‘ value of £6,525,000, has been delayed on account of the recent hold-up on the Queensland waterfront?
  2. If such report is not correct, will the Minister inform the Senate what was the value of produce for Britain so delayed’?
  3. Will the Minister take appropriate and adequate steps to ensure against the recurrence of such a state of industrial anarchy and lawlessness ?
  4. What measures, if any, does the ‘Government propose taking against those who broke the law and incited others to do likewise?
  5. Bid the Minister discuss the recent waterfront hold-up in Quensland with a Mr.J. Healy ?
  6. If so, did he discuss the matter with Mr. Healy in the latter’s capacity as ( 1 ) a member of the Stevedoring Industry Commission ; (2) secretary of the Waterside Workers Federation ; or ( 3 ) a member of the executive of the Communist party?
Senator ASHLEY:
ALP

– The answers to the honorable senator’s questions are as follows-: - 1 and 2. There were delays to outward cargoes from Brisbane which would include primary products and foodstuffs. Whilst full details are not immediately available of the values of such cargoes, figures, which I have obtained from the Department of Commerce and Agriculture indicate that the amount of £6,525,000 named in relation to foodstuffs is very greatly exaggerated. The value of frozen meat involved is £250,000 approximately.; of canned meat £120,000 and of other various kinds of meat exports, somewhere in the vicinity of £20,000. Meat, therefore, can be estimated at £400,000. Five thousand tons of butter, worth £1,250,000 in roundfigures, were delayed, and a thousand tons of cheese, approximating £140,000. The total of these two dairy industry commodities is something under £1,400,000. Eight thousand tons of sorghums and 0,000 tons of maize have suffered some delay, these beingworth approximately £400,000. These would be little else of foodstuffs involved, except sugar, which at an outside estimate would not exceed £200,000. These figures total £2,400,000, little more than a third of the figure named in the honorable senator’s question. Wool, the principal other primary product exported from Queensland, sold, but not shipped, aggregated 55,000 bales, worth roughly £2,750,000, but much of this would not be for Britain. The honorable senator has obviously been seriously misinformed in regard to the values of delayed commodities.

  1. The honorable senator asks whether the Minister would take steps to guard against the recurrence of industrial disputes. I shall be glad to hear what steps he proposes should be adopted to achieve freedom from industrial disputes. If the honorable senator has the solution of all the problems associated with this subject, I can assure him that his services will be greatly in demand, not only in this country, but in many other parts of the world, where the complete answer which he expects me to furnish him in relation to Australia has not yet been discovered.
  2. The honorable senator asks what steps the Government proposes to take against those who broke the law in Queensland and incited others to do likewise. In invoking the law, as the . honorable senator would agree, it is necessary to he on firm ground, and before I can answer his question it will be necessavy to he sure what law had, in fact, been broken. In general terms, there is no law to compel a man to work if he does not wish to do so, nor has any Australian Government enacted laws to punish strikers. If the honorable senator will l>e more specific in relation to the alleged infringement of laws, his question can be further examined. 5 and 6. I did discuss recently the waterfront hold-up with Mr. Healy. I discussed the matter with him because he is the elected representative of the Waterside Workers Federation. In dealing with the elected representative of a union, 1 accord to him the same consideration whether he is a member of the Australian Country party or the Liberal party or any other party, and this was the attitude which I observed” in my contact with Mr. Healy.

page 654

PAPER

The following paper was presented : -

Arbitration (Public Service) Act - Determination by the Arbitrator, &c. - 1948 - No. 22 - Postal Telecommunication Technicians Association (Australia).

page 654

CUSTOMS TARIFF BILL 1948

Second Reading

Debate resumed from the 7th April (vide page579), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– Yesterday, the Minister for Trade and Customs (Senator Courtice) introduced a number of bills dealing with tariffs, and I listened with considerable interest to his remarks. Some of the schedules to those bills were introduced into the House of Representatives on the 14th November, 1946. I agree that some of them are not of very great importance; the items are included only for revenue-producing purposes or are of a protective nature. Other schedules were introduced as far back as 1939, and have been validated from time to time. The duties, therefore, have been in operation during the past eight years. The duties provided for in those schedules have been so long in operation that they have been accepted by industry. Therefore, it would not be wise, even if it were possible, for any change to be made. For that reason, we have to agree to the schedules. Nevertheless, the debate provides an opportunity for honorable senators to receive some explanation of the changes that have been made. Especially will it give an opportunity to discuss the proposals that have been accepted following . the discussions at the Geneva and Havana trade conferences. It will also enable the Opposition to express its attitude towards different aspects of Government policy in relation to some of our primary and secondary industries, as, for instance, tobacco and cotton, which are two primary industries of vital importance to this country. In the past, important and’ interesting debates have taken place regarding tariff schedules. Undoubtedly, the various protective tariffs which have been introduced by successive governments have played a most important part in the development of this country. They have resulted in the expansion of secondary industries which, in turn, have provided a better home market for our primary products. Nevertheless, I believe that if Australia is to get the best out of the different tariffs that are introduced from time to time, the Parliament should have an opportunity to discuss th em within a reasonable period, and to debate fully any alterations contained in them. I realize that during the war period it was impossible to have a full tariff debate, and that most of the schedules which are now before the Senate have been in operation for a considerable ^period. As I have said, it would not be wise to alter them now, as any alteration at this stage would mean that industries operating under those tariffs would be thrown into a state of turmoil.

The first of the bills to be considered relates to resolutions introduced on the 14th November, 1946. The tariff schedule to which it relates formed part of the Government’s 1946 budget programme, under which reductions of duty were made in respect of methylated spirits, dry batteries and cells, petrol and petroleum products, and carbonic acid gas. In his second-reading speech the Minister said that, with the exception of petrol, little loss of customs revenue was involved, as these were consequential upon reductions of excise duties on similar goods.

Tobacco is mentioned in this bill. Since 1939, this item has provided concessional rates of duty on tobacco leaf imported for blending with 15 per cent, of Australian leaf, but in recent years the Australian crop has diminished so greatly that the item is now proposed to be amended to provide for the minimum percentage of Australian leaf to vary in accordance with the size of the local crop. For many years, the production of tobacco has exercised the minds of not only this and previous Governments but also the growers and the community generally. Tobaccogrowing is a most important primary industry because each year approximately 20,000,000 lb. of tobacco leaf is imported, mainly from the dollar area. The importation of tobacco, therefore, involves a considerable drain upon the dollar pool. If we are to conserve dollars as much as possible, naturally we must produce more tobacco in this country. Canada and Rhodesia, and even some European countries, have for many years been producing sufficient tobacco to meet their domestic requirements, whilst some of those countries, including Rhodesia, export a considerable quantity. There is no reason why Australia should not be able to do likewise.

The tobacco-growing industry in this country has had a. very chequered career. Peak production was reached in 1932 when 12,000,000 lb. of tobacco leaf was produced; but in the intervening period production has declined as follows: - 1933, 9,000,000 lb.; 1936, 6,000,000 lb.; 1939, 4,000,000 lb.; 1941, 9,300,000; 1942, 7.000,000 lb.; 1943, 4,800,000 lb.; 1944, #,’600,000 lb. ; 1945, 2,500,000 lb. and 1946, 2,400,000 lb. During more recent years there has been a decided decrease of production of tobacco in this country. What is the explanation of that decline? As it has persisted for a period of years it cannot be attributed entirely to seasonal conditions. One of the main reasons for the decline is that during the war years farmers preferred to grow other crops which gave them a very much better financial return. Farmers, like those engaged in any industry, are only human, and they will naturally grow the more profitable crops. The decline in the production of tobacco in this country can also be attributed to the policy adopted by the Government during the last four or five years. During the war years, when the Government had complete control of tobacco production, the price paid for tobacco leaf was not attractive to growers. It is quite clear that the imposition of higher tariff duties which have increased substantially since 1939 will not solve the problem which now confronts the growers. Such a policy merely increases the price to consumers; and all smokers know that the present price of tobacco is excessive. However, the imposition of high rates of duty upon tobacco has enabled the Government to obtain substantial revenue in this sphere over a considerable period. The time has arrived when the Government must decide whether it will encourage the tobacco-growing industry as a worth-while primary industry, or whether it will regard tobacco merely as a source of revenue. At present, it seems that the Government is taking the latter view. That policy was quite justified in war-time when every available pound was needed to finance our war effort. Now, however, the Government must decide whether it will allow the industry to die out, or whether, by providing substantial assistance, it will build up the industry and make it a profitable unit in our economy.

Tobacco-growing is a specialized industry. No one can merely plant a few seeds and then say to himself, “ I will wait until the tobacco grows, and then I will get my return “. On the contrary, tobacco-growing calls for special study. Considerable losses are caused by pests and diseases. The Government can assist the growers substantially by intensifying research into the problems confronting the industry. Experimental stations should be established in areas which experts consider to be suitable for the growing of tobacco. In that way advice and assistance would be made readily available to growers on the spot. The industry must compete with leaf imported from countries where tobacco has been grown for many years, and which up till now have enjoyed a very profitable market in Australia. Undoubtedly, those countries do not desire that Australian growers should produce sufficient tobacco to meet our domestic requirements.

The Government must also guarantee to growers ,a profitable price for their product. I suggest that an average price of not less than 3s. per lb. should be provided. I know that the Minister for Trade and Customs will say that such a price would be impracticable bearing in mind the numerous grades of tobacco that are being produced. He will probably say that a flat rate of ls. 6d. per lb. would be too high when one allows for the quantity of low-grade leaf that is being produced. However, I submit that only by guaranteeing a profitable price to the growers shall we be able to help them to produce the brighter coloured high-grade leaf which is most sought after by manufacturers. “With proper methods of grading, and by rendering adequate assistance by way qf advice to growers, I believe that we can help them to produce the higher-grade leaf.

The schedules before us provide for the imposition of duty at rates of from 5s. to 9s. per lb. on tobacco leaf. On that basis, the Government will receive more revenue than is now received by the growers of tobacco. I repeat that the Government should not regard the industry merely as a source of revenue. On the contrary, portion of the revenue derived from the import duty on tobacco should be allocated for the encouragement of tobacco-growing in this country. If that be done, and if the grower be guaranteed a profitable price for his product, the industry will rapidly develop.

Under the measure, the Minister is empowered to vary the proportion of Australian-grown leaf to imported leaf which shall be used by manufacturers in the blending of tobacco. That is a wide power. The Minister will decide the quantity of Australian leaf which shall be blended with imported leaf in the manufacture of tobacco. One can readily see the reason for such a provision, namely, that production has fallen so low in this country that sufficient Australiangrown leaf is not now available toenable manufacturers to observe the provision made some .years ago that they must use at least 15 per cent, of Australiangrown leaf in the manufacture of tobacco. If the Government wishes toimprove our dollar position and, at thesame time, establish the tobaccogrowingindustry on .a sound basis, it must,, first, make the most up-to-date scientific advice available to growers.. Secondly, it is necessary to guarantee for a period of years a pricethat will ensure to the grower an adequatereturn for his labour. The revenue received from taxes on tobacco is substantial, and is well able to bear the cost of putting this industry upon a sound, profitable basis. I trust that the Minister will: give careful consideration to the reestablishment of tobacco-growing, at least to1the stage of development that it had reached in 1932, when 12,000,000 lb. of tobacco leaf was produced in. this country.

Senator NASH:
Western Australia

– I agree substantially with what the Leader of the Opposition (Senator Cooper) has said. It is, indeed, alarmingto find that the lack, of locally produced tobacco leaf has necessitated the abandonment of the provision for the inclusion of ‘ 15 per cent, of Australian tobacco with the imported product. Tobacco production in Australia has fallen sharply in recent years and item 19, as amended, provides for the minimum percentage of ‘ Australian leaf to be varied in accord- ance with the size of the local crop. That there is a huge demand for tobaccothroughout the community is undisputed. To-day, not only do we find the male of ‘ the species smoking extensively, but also-

I think that it can safely be asserted that the female has developed the habit almost as much as, or, in some instances, even more than the male. Tobacco-leaf has been grown in Australia for many years. I am not sure of the present position, but some time ago there was considerable perturbation amongst growers in regard to the prices that they were receiving for their product, and, apparently, in spite of the fact that there was a growers’ representative on the Australian Tobacco Board, there was considerable dissatisfaction with the grading methods employed. One tobaccogrower at Manjimup, in Western Australia, told me that in one year his leaf had been graded as first quality and had been paid for as such, whereas in the following year identical leaf had been classed as second grade, his return being reduced accordingly.

It is pleasing indeed to note that the Leader of the Opposition has gone a considerable way towards supporting something to which previously he was strongly opposed. He said that there should be a guaranteed price for tobacco leaf for a period of years. With that I agree entirely. In fact, we on this side of the chamber have been telling members of the Opposition for a long time that there is a need for stabilized prices throughout our primary industries. It is gratifying, indeed, to note that the ‘ Leader of the Opposition has accepted this view, at least in regard to tobacco.

Senator O’sullivan:

– The Government should supplement, its thinking by action.

Senator NASH:

– This Government has done- quite a lot, much more, in fact, than any other administration has done. What is more, definite results have been achieved. It is only because government assistance has been given to tobaccogrowers that any tobacco leaf at all is grown in this country to-day. I have no recollection of any such help being given by anti-Labour administrations.

Tobacco-growing is of great importance to this country. I am not sure that I can agree with the view of the Leader of the Opposition that tobacco-growing should be classed as a primary industry, but certainly it is an essential industry if the demands of the community are to be met. It is also a specialized industry. Few people in this country know how to grow tobacco efficiently. It is not a task for novices. In Western Australia the majority of tobacco-growers are people from other countries who have brought to Australia a practical knowledge of the industry. I am afraid that many Western Australian farmers who engaged in tobaccogrowing were not sufficiently acquainted with the requirements of the industry. That is why I agree with the Leader of the Opposition that it is a specialized industry, and that there is a need for expert advice, not only from the Commonwealth Government, but also from the State governments through their Departments of Agriculture. The Council for Scientific and Industrial Research is of immense assistance to primary producers generally, and I have no doubt that if requested it would be prepared to interest itself further in the production of tobacco leaf in this country. Tobacco-growing is different from the production of any other crop. For instance, great attention has to be paid to the elimination of pests, and also to the prevention of diseases such as mould, which are caused by an unsuitable climate. It is also essential to have the right type of soil. I have no doubt that tobacco production in Australia, in recent years at least, has been hampered by insufficient labour. I have seen tobaccogrowers working in the fields with their wives, their children, and, in some cases, their neighbours. However, the labour shortage is being overcome gradually, largely as the result of the immigration policy of this Government.

Undoubtedly, the tobacco industry is of considerable importance to Australia and whatever we can do to assist it should be done. By producing the maximum quantity of leaf locally we shall be conserving our dollar funds and perhaps making available to the smoking public tobacco of a better quality than has been offered in the past. I am informed that some of the tobacco leaf grown in this country compares favorably with the best leaf anywhere else in the world.

Senator O’SULLIVAN:
Queensland

– This is an opportune time to urge upon the Government the necessity to extend more sympathetic consideration and treatment to the tobacco-growing industry. Production figures indicate that tobacco-growing in this country has suffered considerably. The annual output has decreased from 12,000,000 lb. in 1929 to approximately 2,000,000 lb. However, that decrease in the volume of production may not be quite so alarming as the figures would indicate because there has been an improvement of the quality of the leaf produced. In that connexion, too much cannot be said in praise of the magnificent work of the Council for Scientific and Industrial Research in assisting this comparatively young industry to grapple with and overcome the problems with which it has been faced. Much has been done by that body in regard to the elimination of pests and the selection of the right type of soil. Experts ‘ have determined that in areas as far apart as Mareeba in the far north of Queensland, and Texas, which is near the New South “Wales border, first quality tobacco has been grown. It would be wise for the Government to encourage not so much the volume of production as the growing of tobacco of a quality that will compare favorably with the best in the world. That would add substantially to the stability of the Australian economy. The smoking habit appears to be growing - if there remains any room for growth - amongst the adult population of this country. Our overseas tobacco bill is tremendous. We are shrieking for more dollars. Many of the economic ills that we suffer to-day are attributed to the dollar shortage. Here is a. practical’ way in which a substantial part of the dollar deficiency can be made good. In strengthening our economy by this means we should be, at the same time, providing opportunities for the development of what could be a very big and prosperous industry in this country. As the Leader of the Opposition (Senator Cooper) said, there are two essentials upon which the success of the industry must depend. One is the production of first quality leaf and the other is the provision of a stabilized price. I commend these thoughts to the Government.

Senator SHEEHAN:
Victoria

– I refer to the remarks made by the Leader of the Opposition (Senator Cooper) and Senator O’sullivan in con nexion with the item dealing with tobaccoand their suggestions regarding the futureof the Australian tobacco industry. I remind honorable senators opposite that this is not the first time that a Labourgovernment has endeavoured to assist thetobacco industry. I well remember that, when the right honorable member forYarra in the House of Representatives(Mr. Scullin) was Prime Minister, the duty on imported tobacco was increasedwith the object of encouraging thedevelopment of the industry throughout the Commonwealth. Because of themeasure of protection that was then offered to Australian tobacco-growers, theindustry developed very rapidly, especially in the Eurobin Valley and other parts of Victoria suitable for tobaccogrowing and in New South WalesThousands of pounds were expended by growers to enable them to place on the Australian market tobacco leaf comparable in quality with imported tobacco.

Unfortunately, there was a change of government and an anti-Labour administration led by the late Mr. Lyons cameinto office. That Government immediately began to undo the good work that had been done by the Scullin Government. It reduced the tariff on imported’ tobacco with the result that the young and flourishing Australian industry slowly but surely wilted from that time. The producers -were left to cut their lossesas best they could. Therefore, to-day when I heard the descendants of formerantiLabour governments suggesting what might be done to foster the industry, I thought how ironical it was that they should be arguing along those lines.

Senator COOPER:

– The honorable senator does not desire to see the industry re-established.

Senator SHEEHAN:

– I understand that the Leader of the Oppositionwishes to aid the industry, and I appreciate what he has said in thisconnexion. I am merely drawing attention to the remarkable attitude that was adopted by the people whom the honorable gentleman represents to-day, and towhose positions in this Parliament he and his colleagues have succeeded.

The Leader of the Opposition was a member of this Senate during: the regime- of the Scullin Government. Although I was keenly interested in the attempt that was made by that Government to encourage the tobacco industry, I do not recall that he protested when the Lyons Government took office and undertook a course of action which led almost to its destruction. Once again a Labour government must undertake the task of encouraging tobacco production by granting excise concessions. Unfortunately, there is a virtual monopoly of the manufacture of tobacco and cigarettes in Australia. There are a few small concerns, but the industry is dominated by the big monopolistic British Australasian Tobacco Company Proprietary Limited. I am aware of the difficulties that confront tobacco-growers when they have only one potential purchaser of their products. In view of this situation, stabilization of prices for tobacco leaf would be a very good thing. Stabilization is one of the Labour party’s wellknown methods of protecting .the primary producers against their exploiters.

Regrettably it has been most difficult up to the present to induce primary producers to recognize the wisdom of stabilization and the appointment of price-fixing tribunals. They are slow to appreciate the advantages of such a system. The Leader of the Opposition represents a State which has been controlled by the Labour party for many years. The Labour Government in Queensland is able to govern in its own right without any risk of its legislative enactments being challenged as unconstitutional. The State Parliament has sovereign powers, as distinct from this .Parliament which has only certain deputed powers. Therefore, it has been able to- pass laws for the stabilization of primary industries. The Leader of the Opposition and his two colleagues, who come from Queensland, must be aware of the great advantages that have accrued to the primary producers of that State as the result of the implementation of the Labour party’s policy of stabilization over a long period. Efforts have been made by this Parliament from time to time to introduce a stabilization scheme in the tobacco industry such as the Leader of the Opposition has proposed. However, it is remarkable rtb. at, when .a Labour government has appealed to the people of Australia to repair the deficiencies of the Commonwealth Constitution by transferring certain powers from the States to this Parliament in order that it might legislate for the entire community, the Leader of the Opposition and others of his political faith have opposed the appeal. No doubt when this Government again appeals to the people the same opposition will arise.

Senator O’sullivan:

– The honorable senator said that the State Parliament had been able to stabilize the industry.

Senator SHEEHAN:

– The Queensland Government has been able to do so because the Labour party has been in power in that State for many years and is untrammelled by a Legislative Council. The efforts of other State governments to do as the Queensland Government has done have been thwarted by the actions of Legislative Councils, whose members in the main represent the very interests that exploit the growers of tobacco and of every other primary product. Because of the existence of those conditions in State Parliaments, it is useless for the Leader of the Opposition and Senator O’sullivan to suggest that the States can effectively carry out a policy of stabilization in the tobacco industry. The States cannot carry out such a policy in regard to tobacco because the law governing the imposition of duties of customs and excise is a Commonwealth enactment. Therefore I suggest to honorable senators opposite, and. to their friends, that if they really desire the tobacco-growing industry to flourish they should exhibit a change of heart. We are assured that the Australian soil is capable of growing tobacco leaf which is acceptable to Australian smokers. In the past the development of the industry has been hampered by the tactics adopted by local vested interests, which preferred to “ push “ the sale of the imported leaf. Because of the propaganda disseminated by them the Australian people have been led to believe that the locally grown leaf is inferior to the imported leaf, and so long as that belief continues the sale of Australian-grown leaf will be handicapped. The National Parliament must have power to fix prices in order that it may assist the development of Australiaa industries. I was pleased to hear honorable senators opposite express the views which they did this afternoon, and I should like them to go to primary producers and repeat what they said in regard to the necessity for fixing prices which will ensure fair and reasonable returns to growers.

Senator COURTICE:
Minister for Trade and Customs · Queensland · ALP

[4.33”!. - in reply - The bill has found general acceptance in the Senate and the only criticism of it offered was that advanced by the Leader of the Opposition (Senator Cooper) in regard to the duty on dry cell batteries arid tobacco leaf. I do not propose to make a speech on the importance of the tobacco-growing industry to Australia. The measure before us affords protection to Australian tobacco leaf of ls. 6d. per lb. on manufactured tobacco which contains the prescribed percentage df Austraiian leaf. The purpose of the Government’s proposal to leave to the Minister the determination of the proportions of Australian leaf to be blended with imported leaf is to provide for variations caused by Seasonal fluctuations in the quantity of Australian leaf available for manufacture. If production of Australian leaf increases considerably the Government wishes to be quite free to provide for its inclusion in tobacco mixtures. I agree with the Leader of the Opposition that the industry has had a somewhat chequered career, and Senator Sheehan ‘also referred to the vicissitudes which it has undergone. The Scullin Government introduced a tariff designed to encourage the production of Australian leaf, but in 1932 the Lyons Government changed the tariff policy, and that had a most detrimental effect on the tobacco industry. During the recent war those engaged in the industry had a very trying time. A great many Queensland growers of tobacco were interned, and many tobacco farms went out of production. That, together with shortage of manpower and seasonal conditions, has been responsible for a marked decline of production. However, I believe we can look forward with confidence to the future of the industry. It is essential that it should be placed on a proper footing and that those engaged in the production of Aus tralian leaf should be able to carry on successfully. I believe that more could be done to assist the industry by the provision of additional technical assistance. When tobacco was first grown in this country’ large crops were produced, but it was of inferior quality and was of little value. However, considerable improvements’ have been made as the result of experience and technical reasearch, and I believe that in Queensland, at least, a great deal more tobacco of acceptable quality can be produced than in the past. I hope that the Queensland Government will co-operate with the Australian Tobacco Board to assist in the production of the maximum quantity of tobacco leaf. The concessional rate which has been granted to manufacturers to encourage the inclusion of Australian leaf in blended tobacco will assist in disposing of Australian crops. I do not venture any opinion in regard to the method of appraisement of tobacco leaf adopted or of the system of assessing payments to growers, but I believe that it should be possible to improve the returns to growers. I know that an appraisement tribunal operates to determine the quality of tobacco leaf produced in this country, but whether its findings are based on an equitable basis I am not prepared to say. However, I believe that the industry is worthy of support by the Government, and I am pleased that members of the Opposition and of the Senate generally agree with the principles of the measure.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator COOPER:
Leader of the Opposition · Queensland

– I propose to confine my remarks to Tariff Item 19 (b) of Division II. of the schedule. If this measure is intended to be merely a revenue-producing instrument the Government should say so. Since 1939 there has been an all-round increase of 2s. per lb. in the duty on tobacco. I contend that from the revenue derived from duty imposed on tobacco the Government could well afford to expend money to reestablish the tobacco-growing industry. It should provide facilities for the conduct of more intensive research into the diseases and pests which afflict tobacco plants: It should also provide for the establishment of laboratories and field stations to carry out research in tobaccogrowing areas. The increase of duty on tobacco since 1939 amounts to approximately 331/3 per cent., and whilst the Government may have been justified’ in seeking additional revenue from that source during the war, it cannot put forward that argument to-day. I repeat, therefore, that an obligation devolves upon the Government to do something to foster the tobacco-growing industry in this’ country.

Senator COURTICE:
QueenslandMinister for Trade and Customs · ALP

. -The increase of duty on tobacco’ over the years has been uniform and is, admittedly, fairly substantial. The suggestion made by the Leader of the Opposition (Senator Cooper) that the Government should appropriate some of the revenue received from duties on tobacco for the purpose of fostering production of Australian tobacco leaf is a, somewhat novel one. However, I have taken note of the suggestions which he made for the provision of additional research and technical facilities intended to develop the local industry, and I believe that the Government should consider assisting the industry.

Bill agreed to;

Bill reported without request’s; report ad’opted.

Bill read a third time.

page 661

CUSTOMS TARIFF (SOUTHERN RHODESIAN PREFERENCE) BILL 1948

Second Reading

Debate resumed from the 7th April (vide page 579), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

.-The Customs Tariff (Southern Rhodesian Preference) Act 1941 provided for the payment of a concessional rate of duty oh tobacco leaf imported from Southern Rhodesia. Following on the alteration of Tariff Item 19 of the schedule to the Customs Tariff1933-1939 effected by the Customs

Tariff Bill 1948, this measure is merely consequential. Its purpose is to provide that the minimum quantity of Australian tobacco leaf which can be blended with imported leaf in order to qualify for the payment of concessional rates of duty shall be varied in accordance with the yield of Australian tobacco. The Opposition does not oppose the bill

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 661

EXCISE TARIFF BILL 1948

Second Reading

Debate resumed from the 7th April (vide page 580), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– The Minister for Trade and Customs (Senator Courtice) explained that the Tariff Schedule to which this bill relates was introduced on the 14th November, 1946. The reduction of1d. a gallon proposed to be made in the duty on petroleum or shale products is complementary to the reduction made by the Customs Tariff Bill 1948. In 1940. the rates of duty payable on liquid fuel extracted from shale and coal werereduced in order to encourage and expedite the production of fuel in Australia. The Minister states that at that time the Government gave an assurance to fuel producers that if theyproduced fuel by the 21st August, 1942, they would be afforded tariff protection against imported petrol for fifteen years.

I should like the Minister to inform me of the position in regard to National Oil Proprietary Limited. The balancesheets’ of that company furnished during the past eight years indicate an alarming loss, which has increased progressively from year to year. The report of the Auditor-General in respect of the year ended the 30th June, 1947, shows that during1946 the total quantity of petrol produced by the company was 3,696,9S1 gallons. That represented an increase over the production during the previous year, when approximately 2,000,000gallons were produced. In 1944 only approximately 1,000,000 gallons were produced. However, I stress the alarming losses which the company has incurred annually. The loss on working incurred in 1940 was £180,956 ; in 1941, £177,219 ; in 1942, £263,123; in 1943, £296,981; in 1944, £303,788; in 1945, £342,055; and in 1946, £401,830. The report of the Auditor-General states -

Between 1st January and 30th June, 1947, the Commonwealth made further advances totalling £200,000, increasing the amount of Commonwealth assistance for the purposes of this undertaking to £3,491,735. . . .

Interest accrued but unpaid from 1st January, 1942, to 30th June, 1947, on advances made by the Commonwealth, amounted to £420,092.

Commonwealth money invested in this undertaking amounts to nearly £4,000,000, and the investment is showing a considerable loss each year. The quantity of petrol spirit produced from the undertaking is negligible compared with the yearly consumption in Australia, which I understand is approximately 400,000,000 gallons.

I have some knowledge of the history of this undertaking, because I was a member of the Public Works Committee which made an investigation in, I think, 1940. The committee visited Glen Davis, where operations were being conducted. At that time, some retorts, including a Renco retort, were in use. It was claimed that much better results would be obtained from it than from the other retorts then in use. So far as I know, that Renco retort has not been put into operation. The money involved could be expended to better advantage in many other ways than in the continuance of this shale oil undertaking. In Queensland, research and boring have been undertaken in various districts, chiefly in the Roma district, but although gas has been obtained in reasonable quantities, no flow oil has been discovered. The search is proceeding, and I understand that the Shell Company of Australia Limited has been granted an investigation lease covering a considerable area and is doing a lot of research work. Unless the Government is bound by the fifteen years’ contract with that company, the money would be better expended in assisting the search for oil underground - crude oil - in the Roma district. That would be more profitable than incurring what appears to be an increasing yearly loss. I ask the Minister to enlighten honorable senators in regard to the position which the company occupies, and to say whether the Government is committed to continuing the present arrangement for a period of years.

Senator COURTICE (QueenslandMinister for Trade and Customs) f 4.54”! . - in reply - I regret that I am not in a position to throw any light on the position of this undertaking, which was the result of an agreement which the Menzies Government made with the company. It was suggested at the time that the venture would be very successful. Although I am not able to give very much information as to the present situation,

I believe that there have been considerable losses, and that early expectation? have not been realised.

The purpose of the item is to give concessional treatment to producers of petrol from shale mined in Australia, as against imported petrol or petrol refined from crude oil imported into Australia, with the object of encouraging local production.

Under the National Oil Proprietary Limited Agreement Act 1937, passed by the Lyons Government, . the Commonwealth agreed that, for the period ending on the 31st December, 1964, it would grant protection on up to 10,000,000 gallons of petrol produced by the company from shale mined on certain land, against imported petrol and petrol produced from imported crude oil to the amount of the duties operating at the time, which were: customs duty, 7d. a gallon ; primage, 4d. a gallon ; and excise, 5-Jd. a gallon.

In August, 1940, the Menzies Government gave an assurance to producers of petrol from indigenous shale that, for a period of fifteen years, they would be given similar protection, but without any limitation on gallonage, namely, 7.4d. a gallon over imported petrol, and 5½d. a gallon over petrol refined in Australia from imported crude petroleum. Tariff Item

II (a) (3) was amended accordingly by tariff proposal No. 2 of the 20th August, 1940. These concessions have been maintained in subsequent tariff proposals. Therefore, the Government has continued to honour the original arrangement. The agreement with the company is a matter for my colleague, the Minister for Supply and Fuel (Senator Ashley), who, had he been present, might have been able to give some information as to the present condition of the industry and the position of the Commonwealth in relation to it. A great deal of work, some of it very costly, has been done at Newnes, and from time to time the hope has been voiced that the venture will be successful. This tariff item continues the conditions contained in the agreement.

Question resolved in the affirmative.

Bill read a. second time.

In committee:

The bill.

Senator COOPER:
Leader of the Opposition · Queensland

– I appreciate the Minister’s explanation. It appears to me that the contract dealt only with the gallonage, and did not include any undertaking that the industry would be carried on for a definite period. Protection was assured for fifteen years on a gallonage basis up to 10,000,000 gallons, or in respect of the company, up to any quantity it produced. So far, not more than 3,696,000 gallons have been produced. It appears to me that, as the years go by, the loss on the undertaking will increase.

Bill agreed to.

Bill reported without requests; report adopted.

Bill read a third time.

page 663

EXCISE TARIFF BILL (No. 2) 1948

Debate resumed from the 7th April (vide page 580), on motion by Senator

Courtice–

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– The tariff schedule to which this bill relates was introduced on the 4th June, 1947. The purpose of the bill is to reduce the rate of excise duty on spirit used in the fortification of wine, consequent upon the cessation of payment of wine export bounty due to the expiration of the Wine Export Bounty Act 1939-1944, which made it unnecessary to transfer 2s. 6d. a gallon from excise collections to the trust account from which the bounty was paid. The Government decided to reduce the rate of duty on fortifying spirit by 2s. 6d. a gallon. This resulted in a flat rate of 4s. a gallon being applied.

This is a machinery measure, and I shall not oppose it.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 663

CUSTOMS TARIFF BILL (No. 2) 1948

Debate resumed from the 7th April (vide page 582), on motion by Senator COURTICE–

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– This is the first of a group of four tariff measures relating to tariff resolutions introduced on the 14th November, 1947. At the end of last year the Parliament passed a bill to amend the Customs Act to provide for the calculation of value for duty on imported goods in Australian currency, thereby abolishing the addition of the statutory 10 per cent. to the f.o.b. value of imported goods. The result of last year’s amendment to the Customs Act was to increase the figure at which the value for duty was expressed. For example, a previous value for duty of £110 sterling is now expressed as £125 Australian. This would have resulted in increased duties being collected had the tariff ad valorem rates had remained unchanged. As the amendment of the Customs Act was purely for administrative purposes it was necessary to reduce ad valorem rates by 12 per cent. so that approximately the same amount of duty as previously would be collected. All reduced rates have been adjusted to the nearest 2½ per cent. in order to avoid numerous fractional rates. The tariff shows the actual rates which are operating under existing exchange conditions.

I notice that in the schedule only numbers are shown against the respective amounts. I should like to know whether any of the basic rates of duty have been altered. Do they remain the same; in effect, is the only alteration made the change from the sterling to Australian currency as the basis of calculating value for duty?

Senator COURTICE:
[5.5]. - in reilly - As the Leader of the Opposition (Senator Cooper · QueenslandMinister for Trade and Customs · ALP

has said, the purpose of the measure is administrative. It alters the basis of calculation of value for duty from sterling to Australian currency. No alteration has been effected in the amount of duty. I shall give an example comparing the old and the new methods of assessment of duty on an article valued at £100 sterling f.o.b. Under the old method, value for duty would be £100 plus 10 per cent., that is £ 110 ; and duty at the rate of 50 per cent, on £110 would be £55. Under the new method, value for duty would be f.o.b., converted. to Australian currency, that is, £125; and the old duty of 50 per cent., reduced by 12 per cent., equals 44 per cent., and duty at the rate of 44 per cent on £125 equals £55. Thus, no alteration whatever is made in the amount of duty collected.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 664

CUSTOMS TARIFF (NEW ZEALAND PREFERENCE) BILL 1948

Second Reading

Debate resumed from the 7th April (vide page 582);, on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– This measure is complementary to the Customs Tariff Bill (No. 2), with which we have just dealt. Certain items in the Customs Tariff (New Zealand Preference) Act provide for ad valorem rates of duty, and the reduction of the rates by twelve -per cent, is effected on the same basis as provided under the Customs Tariff Bill (No. 2) 1948. I should like the Minister for Trade and Customs (Senator Courtice) to give information with respect to one matter. It appears to me to be rather extraordinary that items such as locomotives, oil engines, windmills and stone crushing machinery, are provided for in the schedule under this measure. I doubt whether any articles of that kind ha.ve ever been imported from New Zealand, or at any rate, for many years past. Why are such articles provided for under this measure when, apparently, no benefit is to be gained ?

Senator COURTICE:
Minister for Trade and Customs · Queensland · ALP

. - in reply - I do not know the extent of our trade With New Zealand, but we extend a special tariff preference to that dominion. The negotiations from which those proposals emerged have been most thorough; and, apparently, the representatives of both New Zealand and Australia are of opinion that articles such as those mentioned by the Leader of the Opposition (Senator Cooper) should be provided for. I doubt whether we have ever imported from New Zealand locomotives, or machinery of the kind mentioned by the honorable senator.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 664

CUSTOMS TARIFF (CANADIAN PREFERENCE) BILL 1948

Second Reading

Debate resumed from the 7th April (vide page 582), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

.. - The purpose of the bill is similar to that of the measure with which we have just dealt, except that it relates to imports from Canada. I note that duty on barbed wire imported from Canada is fixed at 50s. a ton. I do not question the rate of duty; but I take this opportunity to inquire whether any move has been made to import barbed wire from Canada. All honorable senators are aware of the serious shortage of barbed wire in this country. It is no exaggeration to say that the shortage runs into thousands of tons. Many graziers and farmers cannot obtain any barbed wire at all. If it is possible to obtain barbed wire from Canada every effort should be made to do so. In such circumstances the only justification for imposing a duty on imported barbed wire would be for revenue purposes, because the exchange rate in itself would virtually represent a protection in respeGt of dutyfree imports. Furthermore, wire and iron products can be produced in Australia as cheaply, if not more cheaply, than in any other country. If it is possible to obtain barbed wire from Canada at present, will the Government be prepared to admit imports duty free for the time being?

Senator COURTICE:
QueenslandMinister for Trade and Customs · ALP

. - in reply - ‘Every honorable senator is aware of the present grave shortage of barbed wire in this country. The policy of the Government is to try to purchase barbed wire wherever it is available. Incidentally, preferential rates of duty are provided at the request of the Government concerned, even though it may not derive any advantage from them. When no articles are actually imported, that is to our own advantage. However, I point out to the Leader of the Opposition (Senator Cooper) that any article in short supply, even though it may in normal times compete with locally produced products, can be admitted under by-law free of duty. That course is being followed by the Government. I assure the honorable senator that I shall give sympathetic consideration to any proposal to obtain barbed wire for use by our primary producers.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 665

CUSTOMS TARIFF (EXCHANGE ADJUSTMENT) ACT REPEAL BILL 1948

Second Reading

Debate resumed from the 7th April (vide page 583), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

.- This bill is complementary to Customs Tariff Bill (No. 2) 1948, with which we have already dealt. It gives legislative authority to action taken last November, and eliminates exchange adjustment on all relevant items appearing in the Customs Tariff. The Minister has admitted that since 1933 various systems evolved to correct the exchange position in respect of the tariff have led to confusion in Australia and overseas. The suggested net rates will facilitate negotiations with Other countries in relation to trade agreements. It was on this basis that the interim tariff agreement was recently made at Geneva.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without amendment or debate.

page 665

CUSTOMS TARIFF BILL (No. 4) 1948

Second Reading

Debate resumed from the 7th April (vide page 583), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– This is the first of three bills to be dealt with in a third tariff group. Certain of the items in the bill were part of the Government’s war-time budget programme. The memorandum of alterations shows all the increases effected in these items since the rates were last debated. The Minister for Trade and Customs (Senator Courtice), in his second-reading speech, stated that the revenues involved are not large, as the increases, with two exceptions, are complementary to increases of excise duty, which are the main sources of increased revenues.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator COOPER:
Leader of the Opposition · Queensland

– I take it that the duties specified in Division II. “ Tobacco and manufactures thereof “ do not represent any increase on those with which we have just dealt.

Senator Courtice:

– No.

Bill agreed to.

Bil reported without requests; report adopted.

Bill read a third time.

page 666

CUSTOMS TARIFF (CANADIAN PREFERENCE) BILL (No. 3) 1948

Second Reading

Debate resumed from the 7th April (vide page 584), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– This amending bill is a machinery measure to maintain Australia’s commitment to Canada under the Canada- Australia Trade Agreement of 1931, when Australia undertook to afford to the sister dominion a preference of 17-J per cent, under the general tariff rate on certain gears incorporated in assemblies. A change has since occurred in the classification of the gears, and the intermediate tariff rate relating to the item under which they are now classifiable does not provide the preferential margin previously agreed upon. It is necessary, therefore, to specify a particular rate which is to apply to Canada. The previous 11$ per cent margin now becomes 15 per cent, as the result of the new basis for calculating value for duty.

Senator COURTICE:
Minister for Trade and Customs · Queensland · ALP

. - in reply - As the Leader of the Opposition (Senator Cooper) has said, this is purely an administrative measure.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 666

EXCISE TARIFF BILL (No. 3) 1948

Second Reading

Debate resumed from the 7th April (vide page 585), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
Leader of the Opposition · Queensland

– I understand that most of the items in this bill formed part of the Government’s earlier budget programmes. No increases in respect of these items have been imposed since the budget of 1942. The memorandum of alterations shows the stages by which the duties progressed prior to that date. No changes in rates of duty are involved in a number of items included in this bill.

Item 6 e formerly provided for a levy on tobacco-growers of 6d. per cwt. of tobacco produced to finance the Commonwealth Tobacco Advisory Committee but, since the formation of the Australian Tobacco Board in 1942, funds have been obtained by other means, and there is no necessity for the maintenance of the levy. Item 10 extends the privileges afforded to official representatives in Australia of overseas countries. These privileges are conditional upon similar concessions being granted to Australian representatives overseas. I am pleased to see this reciprocal gesture being made.

Question resolved in the affirmative.

Bill read a second time, and passed through its remaining stages without requests or debate.

page 666

CUSTOMS TARIFF BILL (No. 3) 1948

Second Reading

Debate resumed from the 7th April (vide page 587), on motion by Senator Courtice -

That the bill be now read a second time.

Senator COOPER:
QueenslandLeader of the Opposition

– This is the most important of the present series of tariff measures. It deals with tariff alterations consequent upon the international trade discussions at Geneva, and subsequently, Havana. These conferences were called to discuss the advisability of a downward readjustment of world tariff barriers. The move for tariff reductions i3 not new. It was suggested by the United States of America to the Prime Minister of the United Kingdom at the time of the Atlantic Charter, when the Empire countries stood alone against fascism. That, of course, was before the attack on Pearl Harbour by the Japanese brought the United States of America into the war. Arguments in favour of tariff reductions were also offered by the then President of that country in connexion with the lend-lease agreement. Naturally, he had to convince the American people that lend-lease would assist, not only Great Britain and other members of the British Commonwealth of Nations, but also the American economy. The signing by the United States of America of the lend-lease agreement was, in fact, conditional on the acceptance by the British people of the principle of tariff revision. We are informed also that a similar condition governed the granting to Great Britain of the recent American loan. Certain decisions relating to tariff reductions were made at the Geneva and Havana conferences. Unfortunately, we have not had an opportunity in this chamber to study the agreements reached at those conferences, although the Minister for Trade and Customs (Senator Courtice) was good enough yesterday to provide honorable senators with a complete list of the 1,700 or more items affected. For many years Australia bas participated in an Empire trade preference scheme, and it is my firm belief that these new agreements relating to a general revision of world tariffs will not be of any assistance to Empire preferences. In fact, I cannot see how the system of Empire preferences can be maintained at all. Unilateral trade agreements have been a strong tie between Empire countries. Probably the strongest ties between countries are mutually beneficial trade agreements. We have enjoyed a measure of preference which has made it possible for us to exchange our goods advantageously with other nations of the British Commonwealth. In the past, the powerful, wealthy and strong British Empire has been one of the greatest forces for peace in the world. Great Britain is the centre of that Empire. Unfortunately, it has been left temporarily impoverished and militarily weakened as the result of its immense war effort, which imposed a tremendous drain upon its reserves of riches and man-power. Instead of being a creditor nation, as it was for many years, it is now a debtor nation and is having great difficulty in meeting the many com mitments which it had to incur solely for the purposes of war. To-day it is more than ever important that the ties which have held the Empire together through the years should be strengthened instead of weakened, as I consider they will be by the international trade agreements which we are discussing.

There is room in the world for a powerful and wealthy United States of America alongside a powerful and wealthy British Empire. The two, working together for world peace and the welfare of democracy, can exert incalculable influence against the intrusion of other forces which are working for the destruction of democracy and the breaking of peace. Should the British Empire be crushed, the rest of the world, including the United States of America, will totter and fall with it. Mr. H. Wickliffe Rose, President of the American Tariff League, speaking of the International Trade Organization, said -

The question which we must decide as a matter of foreign policy is, which is more important to the United States - to have a strong, vital British Empire or to have free access to those markets and thereby weaken the Empire itself. The American Tariff League does not presume to indicate the choice. It only points out that we cannot have both and that, until the choice is made, we will only cause confusion and delay by trying to accomplish both. Meanwhile, the United States of America is compromising its position of world leadership in international affairs.

That is very true. Mr.” Wickliffe Rose has realized that the United States of America cannot have things both ways. We in Australia must also realize that we cannot have things both ways. We cannot choose for ourselves the best terms of trade with other countries outside the British Empire and, at the same time, continue to receive the preference which we have enjoyed within the Empire over the years. It is of far greater importance to us than it is to the United States that the British Empire should be strong, because we are part and parcel of the Empire and we stand or fall with Great Britain.

The United Kingdom has always been Australia’s best customer. For years it has taken the bulk of our surplus commodities. The Commonwealth Statistician’s figures show that, for the six months ended the 31st December, 1947,

Australia’s imports from’ the United Kingdom were worth approximately £A.50.000,000. The value of our exports to the United Kingdom in that period was approximately £A.68,000,000 The volume of that trade was greater than that of out trade with any other country. We all know that the United Kingdom has been able to take large- quantities of our surplus primary products in years of gluts. But for that Australian producers, and consequently, the nation as a whole, would have suffered considerably as the result of being obliged to face keen competition in world markets. Amongst the Australian industries which have benefited as the result of British preference are those which produce sugar, butter, wine, beef, eggs, honey, processed milk, and fruit. At the present time we have no difficulty in finding markets for all our surplus prod nets, whether primary or secondary. That is because all commodities are in short supply overseas and other countries are anxious to buy our goods whenever they are available. Therefore the value of Empire preference is not obvious at present. Its real value can be seen when there are world-wide surpluses of goods. Then we have to find means of competing against other countries which are also anxious to dispose of surpluses. In such circumstances, Empire preference has been most advantageous to Australia.

I now refer to what may be more or less a parochial matter, but which, nevertheless, is of great importance to Australia a’s a whole. Being a Queenslander, I am naturally interested in one of our great primary industries - the sugar industry - which has been of tremendous value to the economy of the nation for many years. Furthermore, the development which’ it has brought about in Queensland was of considerable service to’ the nation during the recent war. The expansion of the sugar industry led to the construction of roads and railways and the establishment of prosperous towns in the far northern areas of Queensland where, under other conditions, such development would not have occurred. The closer settlement of the sugargrowing regions made possible the expeditions transport of troops, munitions and other war equipment at a time when Australia was in danger. This was additional to the monetary value of the industry to Australia. Considerable concern has been aroused in Queensland at the possibility of the removal of the embargo on the importation of sugar. For 30 years our sugar industry has been able to supply our needs and also’ to provide a surplus for export. Representatives of the industry fear that this protection! may be attacked as a result of the Geneva trade conference and that Australia may be forced, under the terms of- an international agreement, to admit sugar produced in other countries as well as to surrender its place in overseas markets.

Australia’s exports of sugar amounted to about 400,000 tons annually before the war, and the quantity was increasing as world consumption increased. This matter requires clarification. The representatives of the Colonial Sugar Refining Company Limited were dissatisfied with the replies which they received at the Geneva conference to their representations on behalf of the Australian industry. I should like the Minister for Trade and Customs (Senator Courtice) to give to the Senate reliable information as to the situation of the sugar industry in the light of the overseas trade talks, with respect to both the home market and the export market. The prewar export quota of 400,000 tons wa!s whittled- away during the war because, under war-time conditions, the industry was not able to continue production on the pre-war scale. The United States of America, which is a large consumer of sugar, still adheres to a policy of preferential tariff in regard to its sugar imports. Under legislation which was recently enacted in that country under the title of the Sugar Act 1948 an almost closed economic system was established. The principle characteristic of that system is the adoption of a definite preferential basis. The system embraces: (1) beet and cane sugar produced internally, which receive assistance in a variety of forms; (2) cane sugar from Puerto Rico and Hawaii, which is admitted free, those territories being regarded as detached parts of the United States, although they are, in point of fact, colonial possessions analogous to Jamaica and Fij’i; (3) cane sugar from the Philippines. Until the Japanese occupied the Philippines, sugar from those islands was admitted free. The islands became an independent republic on the 4th July, 1946, but the Philippines Trade Act of 1946, which was signed by President Truman on the 1st May, 1946, provides inter alia for an annual quota, in respect of sugar imported from the Philippines, of 850,000 tons, of which not more than 50,000 tons may be refined. Until the 3rd July, 1954, a period of eight years, 850,000 tons of sugar will be allowed free entry into the United States each year until the 31st December, 1954, the duty payable will be calculated on a basis of 5 per cent, of the lowest United States duty levied on sugar from any foreign country, and during the calendar year 1955 on a basis of 10 per cent, of such duties. During the years 1956 to 1972 inclusive, the duty will be increased annually by an additional 5 per cent., until during the period from the 1st January, 1973, to the -3rd July, 1974, imports will be dutiable at the same rate as shall be applicable as to other foreign countries;

  1. cane sugar from Cuba, which is an independent state and a member of the United Nations. This is to be admitted at a special preferential rate of duty; and
  2. sugar on which the full duty is payable imported from countries other than those previously mentioned. The full duty is £3 17s. (stg.) a ton, and the special duty is £2 16s. a ton. From 1934 until 1942 sugar could be imported into the United States only according to a system, of quotas under which sugar from countries other than Cuba was allocated a tonnage which represented approximately only 0.25 per cent, of the nations requirements, except in one or two years, when other duty-free or preferential producers were unable to supply their quotas. In other words, sugar ‘ from foreign countries, other than Cuba, was for all practical purposes excluded from entry into the United States of America. That system, which formed part of the Sugar Act 1937 of the United States of America has been revived in the Sugar Act 1948. The annual consumption of sugar in that country is 7,500,000 short tons, and of this quota domestic areas are allotted 4,286,000 tons. The quota, in respect of the Philippines is 952,000 short tons, and Cuba is to be permitted to export to the United States of America 98.64 per cent, of any deficit’ of supply in that country. Foreign: countries will be permitted to export to the United States of America only 1.3ft per cent, of that nation’s requirementsOn the basis of a quota of 7,500,000’ short tons, Cuba would be permitted to export to the United States of America 2,248,992 short tons, and other countries only 31,008 short tons each year.

From the foregoing figures and percentages it will be realized that the sugargrowers and manufacturers of this country are not seeking any specially favorable treatment. By the recent enactment to which I have referred the United States of America, which is a much greater sugar consumer than is Australia, has virtually prohibited the importation of sugar from “ foreign “ countries; indeed it has almost imposed a complete embargo. Preference is given to those countries which are really dependent on the United States of America. Bearing that in mind, I consider that the people who pioneered and developed the sugar industry in Australia are entitled to know how their industry will be affected by the proposed tariff. I should like the Minister to inform the Senate whether the preferential treatment which the United States of America is extending to the Philippines, Cuba, Hawaii and Puerto Rico is in strict conformity with the recent international trade agreement. If it is, then I contend that Australian sugar producers are entitled to similar preferential treatment.

In order to purchase food and other essentials, Great Britain has been compelled to export greater quantities of manufactured sugar than it exported before the war. Because of the heavy commitments imposed upon the United Kingdom by the war, that country had no alternative but to sell its overseas investments. The result is that to-day Great Britain is almost completly dependent upon its own earnings. Further.more, it is desperately striving to increase its exports in order that its economy may continue to function, and that disregards altogether the necessity for finding money in order to replace worn-out machinery and to rehabilitate its industry. Will the international agreement under consideration assist Great Britain to achieve its objective?

Sitting suspended from 5.69 to 8 p.m.

Senator COOPER:

– Will the trade agreements that have been entered into at Geneva and Havana assist Great Britain to recover some pf the markets -which it lost because of the war, and aid it to regain substantially the position that it held prior to the war? Will these agreements assist towards creating a strong British Empire? I believe that acceptance of these trade agreements will weaken the British Commonwealth of Nations. My reason for holding that view is that the loss of mutual preferential trade will disturb the unity which close trade relationships have ensured and that there will be a tendency to drift apart. Great Britain will lose a certain proportion of preferential trade which it has enjoyed, and there is every possibility that Empire ties that have been formed in the past will be weakened. At the present time the British Commonwealth is a combination of great strength. World production figures, compiled from statistics of the United Nations organization prove this to be true. The British Empire contributes the following percentages of the total world production: - Gold, 57 per cent.; nickel, 85 per cent.; silver, 18 per cent. ; tin, 40 per cent. ; zinc, 30 per cent. ; copper, 30 per cent.; lead, 36 per cent.; diamonds, 35 per cent.; iron ore, 13 per cent. ; rubber, 54 per cent. ; sugar, 30 per cent.; tobacco, 36 per cent.; wheat, 20 per cent.; and wool, 46 per cent. With such vast resources available, there is no reason why the British peoples throughout the world should not be able to re-establish themselves. I believe that when that has been achieved it will have a greater influence on the peace and security of the world than will anything that may be temporarily gained under the proposed international trade agreement.

Senator NASH:
Western Australia

– This bill proposes to amend the Customs Tariff (Canadian Preference) Act 1934-1939, as amended by the

Customs Tariff (Canadian Preference) Act 1948 and the Customs Tariff (Canadian Preference) Amendment Act (No. 2) 1948. To a very large degree it is a result of the Geneva negotiations. The Minister for Trade and Customs (Senator Courtice), in his second-reading speech, indicated that it will be followed by two other bills giving effect to minor changes in the Canadian and New Zealand preferences, for the purpose of maintaining the relative tariff position in those countries.

It was generally desired by all the countries associated with the Geneva conference that any increased rates in respect of imports or exports should be prevented during the currency of the agreement. So far as I know, those agreements are still in the draft stages. They are of an international character nd are designed for the purpose of making possible in a very troubled world a system of reciprocal trading between the various nations. In the negotiations that have taken place Australia’s representatives endeavoured to avoid any detrimental effect on Australian industry. I notice that it is provided that, if necessary, Australia may impose protective duties at a later stage.

As the result of the Ottawa Agreement, there has been preferential trade within the British Commonwealth of Nations for a number of years, but in some quarters it has been suggested that as the result of the proposed agreements, preference will be practically thrown overboard. As I read the decisions made at the conferences at Geneva and Havana, there will be little or no departure from the principles of preferential trade within the British Empire. Although I understand that, in some instances, alterations have been made as the result of bargaining with other countries, I have not seen anything to indicate that Australian trade is likely to be detrimentally affected. For instance, I understand that binding duties have been accepted by Australia in respect of goods not now manufactured in Australia and not likely to be manufactured here for some years. That decision will not do any harm to Australian trade. In my opinion, one of the best ways to prevent future world wars is the negotiation of satisfactory trade agreements between various countries, because, as honorable senators know, very often the causes of war have been economic. The possession by one nation of articles or commodities which other nations covet has, only too often, resulted in the “ have note “ trying to wrest them from their more fortunate neighbour. Any attempt to bring about a better international understanding in regard to trade relationships is a step towards the elimination of the causes of friction between nations, and is, therefore, to be encouraged.

In the period that has elapsed since’ the cessation of hostilities, the world situation has gradually become worse. In many respects the facts are most disconcerting. It is not comforting to reflect that the people of Britain who took the brunt of the fight in the initial stages of the war and prevented the onward march of totalitarianism are now experiencing greater privations than they had to face when the country was at war. In physical losses Britain suffered severely at the hands of the enemy, but to-day the British people are assisting to feed and clothe their former enemies and the people of other European countries who suffered during the war. It is unfortunately true that at this moment the people of the United Kingdom are economically in a worse position than ever before in the history of their country. That emphasises the necessity for the establishment of reciprocal trade arrangements between the countries of the world. The British people as the result of their efforts during the war have now practically exhausted all their assets overseas. Great Britain, in order to feed its people, has been obliged to sell its securities overseas, and to deplete its financial resources to such a degree that its people must now rely on increasing overseas trade in order to recover economically. In order to feed and clothe the British people, the Mother Country negotiated a loan from the United States of America. It was expected that the loan would be sufficient to meet Great Britain’s requirements for approximately four years ; but the loan had hardly been negotiated when price controls in the United States of America were lifted and, consequently, the purchasing power of the loan was considerably reduced. Although ‘ the United States of America came to the assistance of another nation we see in that transaction how the value of the assistance it rendered was substantially reduced because of changes in its internal economy. That development has been responsible to a large degree for the difficult circumstances in which the British people find themselves to-day. Only a few days ago I read in the press a report of a statement by the British Chancellor of the Exchequer in which he declared that it was essential for the preservation of the people of the United Kingdom that the Marshal plan be implemented. All these facts emphasize the necessity for the establishment of reciprocal trade arrangements. Otherwise, the economy of many countries must be jeopardized.

Bearing that objective in mind Australia participated in international consultations which resulted in the establishment of the United Nations organization. Already, some people suggest that that organization has seen its day, and will suffer the fate which befell the League of Nations. However, I believe that whilst the United Nations organization has been dinted it has not been broken, and that if the nations adhere to the ideals underlying the organization it will ultimately prove to be the most effective means of peace. In passing this measure we shall be doing something tangible towards the attainment of those ideals. When international consultations were commenced during the war the opportunity was given to representatives of Australia as a member of the United Nations organization to negotiate individually with a number of nations, including the Benelux countries, which comprise the Netherlands, Belgium and Luxembourg and their dependencies and also Brazil, Burma, Ceylon, Chili, China, Cuba, Czechoslovakia, France and its colonies, India, Pakistan, Newfoundland, Norway, South Africa, the SyroLebanese countries, the United Kingdom and the United States of America. Our representatives negotiated directly with representatives of those countries, and as the result certain requests were made to

Australia in respect of trade arrangements. “We are assured that the concessions which Australia proposes to make will not be detrimental to secondaryindustries in this country. If we are honest in our approach to this problem we must be prepared to give and take.

I understand that Article XVI. of the Geneva Charter preserves Empire trade preference. It is of the utmost importance to Australia that we shall encourage to the greatest possible degree trade among the British Commonwealth of Nations. Indeed, I believe that solely on the basis of Empire trade we can stabilize the economy of every Empire country for many years to come. However, at the same time, we must realize that during the ‘ war years the British people became partners with a very powerful white nation, the United States of America. The population of the United States of America has increased to an extraordinary degree in recent years. I understand that that country now has a population of from 144 millions to 146 millions. When I was there in 1945, I had an opportunity to gain some idea of the potential capacity of its manufacturing industries. Should we fail to arrive at some reciprocal trade arrangement with the United States of America, and should the people of that country decide to produce to the limit of their capacity, we should find it most difficult, indeed, to maintain our present prosperity. The more we look at this problem the more we realize that the world to-day is much different from what it was not very many years ago. Consequently, we must change our approach to the problem of international trade. Whilst I believe that, primarily, we must develop to the utmost reciprocal trade relationships with other members of the British Commonwealth of Nations, we must, at the same time, establish similar arrangements with other countries, particularly the United States of America. In this connexion, our thoughts turn to the teeming millions in India and Pakistan, the two youngest members of the British Commonwealth of Nations. We may not adjudge the people of those countries, individually, to be prosperous, but as countries those nations are enormously wealthy. The sad fact that each year millions die in those countries as the result of famine is evidence that Australia has a remarkable opportunity to expand its export markets there. I have already mentioned that we have entered into direct negotiations with them. In addition, we have prospects of expanding our markets and finding new ones in the Netherlands East Indies, China and Java as well as in other countries in the South-west Pacific. Provided that we overcome the industrial troubles that beset us and produce to our utmost capacity, we have unprecedented opportunities to establish trade relations with those countries. I agree wholeheartedly with the statement made recently by the Prime Minister (Mr. Chifley) that our “ honeymoon “ is over, and that we must now produce to the utmost of our capacity. I sincerely trust that not only the workers, but also the manufacturers and primary producers of Australia will immediately take heed of the Prime Minister’s warning, and enable Australia to take full advantage of the opportunities presented to it to-day, because therein lies the future welfare of this nation.

In addition, we need to increase our population. We are endeavouring to assist the United Kingdom by bringing to this country as many people of British stock as we possibly can. Assuming that our intake of migrants reaches the proportions that the Government anticipates, we shall be better enabled to increase production. Should we fail to do so, we shall find ourselves in circumstances which will breed another army of unemployed. For obvious reasons, many people in this country would like once again to see an army of unemployed. I warn the Australian workers that on their shoulders rests the responsibility to ensure that economic conditions which make such an army possible shall never return to this country. They can be avoided if the workers, the industrialists, and the financial interests pull together. This problem would be solved if wo could return once again to the spirit of reciprocity, comradeship, and co-operation which pervaded this nation during the war years. In those days, everybody was prepared to help his neighbour because he knew that a failure of the Allied cause would be catastrophic. I regret the absence of this fine spirit to-day. As I have said, there are those in the community who would favour a return to the “ good old days “ when it was possible to exploit the other fellow, and when there was always a man outside the gate waiting to take the job of the man inside. We must so order our economic system that the remotest possibility of a return of such a state of affairs will be eliminated. That can be accomplished if we pull together and if we prosecute to the utmost our desire for reciprocal trade throughout the world.

I believe that the International Trade Organization which has already accomplished much at Geneva and Havana, can be of tremendous value to Australia, in the future, and that as it develops, it will bring about a much better feeling between nations. In conclusion, I shall quote a paragraph appearing in a document that has been issued to every member of this Parliament. It is the explanatory statement of the General Agreement on Tariff and Trade. The document states -

For better or worse, the International Trade Organization is likely to he the only attempt to establish an international body in the trade sphere in this generation. If it is set up, Australia’s interests will be markedly influenced whether we come in or stay out.

I emphasize the words, “ Australia’s interests will be markedly influenced whether we come in or stay out “. They are of great significance.

Senator SANDFORD:
Victoria

– We, on this side of the chamber are in sympathy with some of the remarks of the Leader of the Opposition (Senator Cooper). I refer particularly to what the honorable senator said about Britain’s present economic position, and the magnificent efforts of the British people during World War II. We are living today in a world of reality; no longer are we isolated. The tariff schedules to the measures that we are discussing to-day are the result of considered deliberation by experts at Geneva and other places. The democracies are determined to maintain the democratic way of life, and the only way to ensure the survival of democracy is for the great democratic countries to co-operate.’ During the six years of World War II., almost the entire world was ravaged and dislocated as it had never been before. To-day, the international situation is far from promising, but we hope that sanity will prevail and that we shall avoid the holocaust of another world Avar.

Our obligations to-day are not only to Empire countries. However anxious we may be to maintain our system of Empire preferences, and to safeguard the unity of the Empire - we on this side of the chamber are just as patriotic as honorable senators opposite are in this connexion - we must realize that there is an obligation upon us to help to build up the democracies as a bulwark against communism. In the House of Representatives yesterday and earlier to-day a motion relating to communism in Australia was debated. We could serve theinterests of the Communists no better than by disregarding our obligations to> the democratic nations of the world1.. The breeding ground of communism is in misery and destitution. We do not want to see these conditions in Australia or in the other countries upon which we should have to depend in the event of another conflict. That the danger of such a conflict exists to-day is clear from overseas reports. One has only to remember what has happened in Czechoslovakia. If other countries such as Belgium, Holland and Denmark are not built up by the democracies, they too may be overrun by the Communists. We must cast our eyes beyond the boundaries of the Empire. We must be realists in a changing world. The best way to build up not only the British Empire but also the democratic world is to facilitate trade relations.

Undeniably Britain is in a desperate plight. We are doing our best to ease the position of the people of that country, but we must not lose sight of our obligations to the other nations that participated in the international trade conferences. During the war, the Australian people built up the economy of this country to a standard which in previous years had been thought impossible. In the last decade, Australia lias made extraordinary advances particularly m its secondary industries. It is our duty to ensure not only that the maximum assistance shall be given to Great Britain in its hour of need, but also that Australia itself shall be safeguarded against any possible threat to our security from the Asiatic people to our north. Australia must be made even stronger than it was during the war. No longer can we rely upon our isolation for security. At one time our isolation was our greatest weapon of defence, but to-day distances have been annihilated and no longer can we believe complacently that our remoteness will save us from danger.

The fact that in Australia to-day there are practically no unemployed gives food for thought. We must make every endeavour to maintain our economy at its present high standard, or even to raise that standard. Unless we can do that, unemployment will occur, and we may have a recurrence of the bitter experiences of the last depression. That would be the surest way to foster communism. Our representatives overseas have put forward their best efforts. They have the interests of Australia and the Empire at heart, but in a changing world we cannot pin our faith to out-of-date methods. We must realize that the expansion of our industries and the building up of our economy necessitated an enlargement of the scope of our . overseas trade. Our trade with the United States of America during World War II. gave rise to our present dollar problems. We must do our best to meet those problems and also to assist Great Britain to overcome similar difficulties. We must not be blind to realities. Trade relationships have changed vastly since prewar days. I refer particularly to Empire preferences. Although it is most desirable to retain these preferences so far as possible, it must be obvious that the 1939 levels cannot be maintained. After the cessation of hostilities in 1945, the organization known as the United Nations was established and Australia became a member. We must work along the lines laid down by that organization in connexion with trade and all other aspects of international relations so as to ensure that it shall be much more successful than the League of Nations was in the year9 which succeeded World War I. For this purpose, Australia must participate actively in the affairs of the United Nations.

As I have said, distance has been annihilated and isolation is no longer the weapon of defence that it formerly was. Having regard to the proximity of Great Britain to the continent of Europe, whence it is generally expected that any attack will come, wc must realize that Australia, because of its geographical position, must eventually become the centre of the British Empire. Therefore, we must build up our economy in the best possible way. This can be done most effectively by engaging as much a9 possible in trade with other countries. Big potential markets are open to us in the Far East, the Near East and countries in the American zone. We should encourage trade with those countries to the greatest possible degree. Because of our obligations to our own people, to the British’ Empire in general, and to the democratic peoples of the world, we must ensure that this country shall become a bulwark against threatened danger from any source whatever. We cannot afford to remain in our shells like oysters, as we did after World War I. We must work in harmony with the other nations of the world, and we must endeavour to strengthen the democratic countries that were ravaged during the war. France, Belgium and Holland need help and we must give all possible aid to the United Kingdom. We on this side of the Senate yield to nobody in our admiration of the British people and in our determination to remain within the British Empire. We believe that we are rendering the greatest possible help not only to ourselves, but also to our fellow nations within the British Empire by building up the economic structure of Australia. The future welfare of Australia and of the Empire in general depends upon increasing Australia’s population as quickly as possible. We should bring as many white people as possible, preferably British citizens, to this country in order to make absolutely certain that Australia shall become the centre of the British Empire not just geographically, but in every possible way.

It is of no use for members of the Opposition to talk about the spread- of communism and to waste the time of this-

Parliament by airing nebulous theories about the best way to deal with the menace. We must face realities. The only way to defeat communism and to eliminate it is to fight it in the open. To that end we must keep within the framework of international trade agreements embracing the democratic countries of the world. That is the surest possible way to avoid the calamity of a third world war. I do not propose to discuss these . trade agreements in detail or to dilate upon any of the items connected with them. I make my contribution to this debate solely in an endeavour to impress upon the Opposition the fact that the trade agreements which we are considering were not reached in any hurried way and were not the result of any desire on our part to treat our British kinsfolk less leniently than we have done in the past. I make perfectly clear that, in my opinion, the Australian representatives at these international conferences did a remarkably good job. I emphasize that, because of the dangers inherent in the present world situation, we must think of the welfare not only of the British Empire but also of other democratic countries, and must seek to build up those countries until they can withstand any threatened attack. The best way to do this is to engage in reciprocal trade agreements.

For the reasons which I have stated, I commend the Government’s tariff proposals. Its representatives have done a good job for Australia by helping to cement friendly relations between democratic countries. This policy serves not only wide international interests but also the interests of Australia, particularly in connexion with the Government’s policy of maintaining full employment so as to prevent any recurrence of the conditions which obtained in the ‘thirties. At that time the parties now in Opposition - principally the Nationalist party, alias United Australia party, alias Liberal party - espoused a policy which caused depression, misery, starvation and degradation. They neglected opportunities to develop this country and to improve the conditions of Australian citizens in a way which would have stood the nation in good stead when World War II. commenced. Even now, when great strides are being made towards building up the democracies as a bulwark against communism and other “ isms “, these parties adhere to the insular policies which they pursued prior’ to World War II. Their representatives in this chamber engage in arguments which have no sound foundation, merely in an endeavour to discredit the Labour Government. However, I believe, as do most Australians, that our only hope of maintaining stable trade relationships with other democratic countries is by retaining Labour governments in power in both the Federal and the State spheres. If the Opposition parties ever came into power - of course there is no possibility of that - they would immediately set up the status quo, under which we should revert very quickly to the conditions which we suffered in the ‘thirties. I have great pleasure in supporting the Government’s tariff proposals. Our responsibilities extend farther afield now than they have ever done before, and, in view of the dangers inherent in the present world situation, we should do everything posible to build up the British Empire and a union of the democratic countries of the world by means of reciprocal trade arrangements on the lines of these tariff proposals.

Senator KATZ:
Victoria

.- This measure is evidence not only of the fact that the present Labour Government is Australian in character but also that it has the interests of the British Empire at heart. That is easily discernible. It is remarkable that, even though we criticize the parties now in Opposition for many things which they have done or have failed to do, there is almost complete unanimity between us on this subject. A measure of this kind discredits instantly the charges that have been laid against the Government of. favouring, and actually supporting, certain foreign ideologies. The Govern- ment has demonstrated beyond all doubt, that it, and the Labour movement ofl Australia as a whole, supports the British ideology in the sense that the Britishpeople stand for democracy. Australia as a nation now plays a part in world organizations. For the first time in its history it is participating in agreements of the kind dealt with in this bill. Every member of this Labour Government has demonstrated his sincerity by helping to put into operation a scheme which makes provision for our future welfare and security. I could easily make critical comments about what has happened in the past in relation to trade between Australia and other members of the Empire. I remember when certain leading Australian traders flooded this country’ with cheaply produced goods from Japan. I also remember the time when Australian graziers had to fight, nor for preferential treatment, but for the right to share iii the British meat market. At that time the United Kingdom Government was giving preferential treatment to a foreign power in the purchase of meat. However, I take consolation from the fact that it was not a Labour Government of the United Kingdom which committed that offence. In the interim we have had two world wars which have changed the whole -economy of the British Empire. To-day the people of Great Britain

Mr gently require all the beef that we can export to them. When we examine the pastoral potentialities of this country we find that more cattle could be depastured in the north-western parts of this continent than are at present depastured in the rest of Australia. That gives us some idea of the scope available to us for the development of one great primary industry alone. We could supply beef not only to Great Britain but also to the rest of the world. There are on the River Murray vast fruit-growing areas and great establishments for the dehydration and packing of fruit. Other primary produce, including butter, is produced in great quantities in Australia for export. Throughout the war years the British people were desperately short of butter, and I remind honorable senators that it was a. Labour Government which made the decision to curtail the supply of butter available to the Australian public in order to provide more butter for the British people. I invite honorable senators now to consider the post-war record of this Government in regard to the production and export of food. Although the war ended two years ago the supply of butter is still rationed in Australia in order that our kinsfolk in Great Britain may have a little more. Despite the protestations of honorable senators opposite of their concern for the welfare of the people of Great Britain, the fact remains that at the last general election the parties to which they belong challenged the Government’s policy on food rationing; and they are already preparing to attack it on the same ground during the forthcoming referendum campaign. However, the Labour Government of this country has stood true to its principles and has- continued the rationing of butter and meat notwithstanding the clamour of the Opposition parties for removal of government controls. The reason why the Government and its supporters are so determined to continue control over food production is that they realize the hardships and sufferings which the working people of Great Britain are experiencing. Tn Great Britain to-day all that remains of a number ‘A huge concerns is heaps of rubble. The working people of Great Britain have had to bear the burden of heir country’s tribulations, and we know that housewives stand for ten and twelve hours in queues. Years of standing in queues has actually altered the physique of British women, in that the arches of their feet have become so weakened that they can no longer wear shoes of the type which they were accustomed to wear formerly.

Members of the Government and of the Australian Labour party are loyal to the British Commonwealth, and it is because of that loyalty that the Government realizes that it must enter into agreements designed principally to benefit, not ourselves, but the people of Great Britain. Honorable senators know that many trade treaties made in the past have been broken, but I believe that the trade agreement with Great Britain which we are at present discussing will stand the test of time. I realize that the United States of America has the bulk of the world’s wealth to-day, and can speak in amounts of £100,000,000 just as we speak in amounts of £100,000. We must, of course, be on our guard to ensure that we do not suffer as the result of any trade or fiscal agreement into which we enter as Great Britain did as the result of the agreement which culminated in. the United States of America making a. loan to Great Britain. We know what happened them. Prices suddenly sky-rocketed in the United States and almost overnight the value of the American loan depreciated. However, I believe that the agreement which we are now discussing will lay the foundation of an Empire which will be able to stand against the rest of the world. For that we have to thank largely the. Government’s emissaries. I have in mind particularly the Minister for Post-war Reconstruction (Mr. Dedman), who so ably represented Australia at the recent international trade conferences, and the Minister for External Affairs (Dr. Evatt). who has played such an eminent part in the conduct of international affairs. Australia can be proud of them, and it is obvious to us that they more than held their own with the representatives of other countries.

I realize that Australian workers enjoy excellent conditions to-day. They have a 40-hour week, and some classes of our employees, such as the Victorian, tramway employees, enjoy better conditions than similar workers in any other part of the world. In order to maintain those conditions we must be prepared to make certain sacrifices, and I enjoin on those who enjoy the benefit of those conditions the necessity for playing their part. Of course, Australia is only a small part of the universe and, indeed, of the British Empire, but it is doing its bit. I said a moment ago that we are laying the foundations of the “ new “ British Empire.

I remind honorable senators that a Labour government has been in office in Australia during the last few years, when representatives of leading British manufacturers have visited this country. Those gentlemen are prepared to invest millions of pounds of capital in the establishment of new industries in Australia. Their willingness to do so demonstrates clearly that they are not afraid of what the present Labour Government is doing. It would appear that they entertain the same opinion of the political future of this country as I do ; in other words, they do not expect any sudden change of government. If they feared that there might be a sudden change of government they would not be prepared to invest their money so readily. Furthermore, the conduct of our representatives overseas, and the endorsement by the Government of the International Trade Agreement, demonstrate beyond all doubt that the charges made against it in relation to a certain foreign power are without foundation. I invite honorable senators to think for a moment of the charges that would have been made against the Government had it entered into a trade agreement with Soviet Russia. The Government should be given credit for what it has done, not only for Great Britain, but also for Australia. In conclusion, I agree with Senator Sandford that the best augury for the security of this country is provided by the full employment which we can provide for our people and others who come here. As an example of the progress that is being made in that direction I need only mention the automobile construction venture undertaken by Genera] Motors-Holdens Limited in Victoria. The progress of their efforts to date indicates that before very long Australia should be able to curtail considerably its dollar expenditure by producing its own motor cars.

Senator O’SULLIVAN:
Queensland

– I understand this bill to be a legislative sequel to the talks which have taken place at international trade conferences, and it is rather pathetic to find supporters of the Government, even on such a major measure as this, getting out the righteous unction, giving themselves a good lather with it, taking out the halo, pressing it down hard on their heads and thanking God that they are not as others. After traversing the political history of this and other countries in order to reveal the iniquities of my political forebears, they give themselves another rub with the unction, give the halo another twist backwards, and say, “ Well, we are not such bad fellows after all “.

Although accustomed to reading, interpreting and occasionally advising - for a fee - upon documents I do not pretend for one moment to have a comprehensive understanding of the document under discussion. However, I believe that it arose from an agreement among the nations concerned, which is expressed partly in the following terms: -

Realizing the aims set forth in the charter of the United Nations, particularly the attainment of the higher standards of living, full employment and conditions of economic and social progress and development, envisaged in article 55 (a) of the charter,

To this end they pledge themselves, individually and collectively, to promote national and international action designed to attain the following objectives: -

To assure a large and steadily growing volume of real income and effective demand, to increase the production, consumption and exchange of goods and thus to contribute to a balanced and expanding world economy.

That is a most commendable proposition and one which should commend itself to honorable senators as Australians regardless of party politics. If we can do anything to offer succour or relief to a shattered and suffering world, we should do it gladly. However, there are considerations of which sight should not be lost. I commend particularly to the Government the necessity for bearing in mind that this country has traditionally followed a highly protective policy. Please do not allow it to be said in years to come, as it has been said in the past, that the present agreement was entered into and the validating legislation enacted because the stick held by the “ almighty dollar “ was waved at us, and that we were forced to accept this agreement against our better judgment and interest. Let any concession which we as Australians give towards the relief of suffering humanity be given with a full knowledge of its implications, present and prospective. I shall touch upon that subject later when dealing with the development of our industries. The country in a position to give the greatest measure of relief to the world at the present time, is that great and generous nation, the United States of America, but this agreement seems to indicate that, some of the sacrifices which the British Commonwealth of Nations will be called upon to make will result in additional trade going to the United States of America. F am sure that the heart of the American people is big and generous, and that the effort being made under the Marshall plan is much more than a mere token; it is not, I am sure, merely as an insurance against a future Avar that that country is expending such vast sums of money in the alleviation of the sufferings of the stricken people of Europe. I am sure that the assistance given and promised comes from a generous Christian heart. But even great and generous people can have at the head of their economic destinies persons not quite so generous, or persons who, although active in the interests of humanity generally, nevertheless, in the process of giving expression to their sentiments, see that they do not lose on the voyage. In a contribution to the London Times the right honorable L. S. Amery, a distinguished British statesman, said -

The real motive, conscious or sub-conscious, is the desire of American exporting and financial interests to maintain a one-side world hegemony by keeping the rest of the world broken up into small economic units incapable of ever competing on equal terms with American production, and dependent on American finance to redress a continuously adverse balance of payments. More particularly it is to be feared does this ambition extend to the economic, and eventually political, domination of the widely scattered members of the British Commonwealth; and this accounts for the peculiar virulence and determination of the onslaught on British Empire preference.

The agreement out of which this measure arises has in it the essence of the eventual destruction of British Empire preference. Some honorable senators may not favour Empire preference, but bc that as it may the point is, that when this agreement is fully implemented, we can say “ good-bye “ to that preference. My authority for that statement is the head of the American Mission. In Washington, on the 21st January, 1947 - Mr. William Clayton, the leader of the delegation from the United States of America to the international trade conferences said that British Empire preference would eventually be completely eliminated. In his opinion that would bt the effect of the working liaison between the international trade organization and the Marshall plan to aid Europe. He went on to say that at the Geneva conference Britain was willing to “freeze” all existing preferences, and then, to dissolve them in the course of the next few years. I appreciate that we in Australia cannot ha ve it both ways. We cannot say that we are a generous, considerate and kindly people because we make some contribution to the relief of suffering humanity if, in fact, the gift does not really hurt us. If we are to make a worthwhile sacrifice to the cause of humanity we shall have to give until it hurts. I urge only that the sacrifice we propose to make shall be within our capacity, and that the resulting contribution to the relief of sufferers shall be commensurate with the severity of the sacrifices made.

I am not a world economist. I know very little about the economy of the world, but it is fairly common knowledge that the greatest contribution to the relief of the world and to the aims so nobly set out in the prelude to the agreement, at a time when the world is suffering from a very severe dollar shortage, can be made by the United States of America. In other words, if that country sold less to the rest of the world and bought more from other countries that would be the greatest contribution within its power.

A matter to which we must pay some attention is the export trade of the respective countries and the proportion which it bears to the total national income. The latest information available is for 1938, in which year the value of exports from the United States of America was only 4 per cent, of the national income, compared with 10 per cent, in Great Britain and 17 per cent, in Australia.

As to the effect that this agreement will have upon Australia, it must be borne in mind that we are gradually emerging from substantially a primary producing country into one with a bigger, better and more evenly balanced economy of both primary and secondary production. If we are to play our part in world affairs in the future as a strong, virile and capable people, we must develop our secondary industries so that in the event of another future world, holocaust we shall be substantially independent of the rest of the world. It is quite conceivable that Australia would be the arsenal of the democracies in any future conflict against a force opposed to freedom and our way of life. We should take care that in the implementation of any committals which we make in regard to the international trade organization there shall be provision for the gradual, appropriate and balanced development of our secondary industries in the years to come.

One Queensland industry will be very much in the danger line should this agreement be fully implemented. I am sure that honorable senators on the Government benches are not unmindful of the dangers to the sugar industry with which this agreement is fraught. In Chapter IV. there is a provision forbidding the imposition of embargoes, but certain provisions of Chapter VI. provide a way of escape. It should, however, be made perfectly clear that industries which are traditional and vital to the economic health and welfare of a country shall not be put in jeopardy in any way. For upwards of 30 years there has been a complete embargo on the importation of sugar into Australia, and it is vital to Queensland that that embargo be continued. Anything that is vital to Queensland is vital to the economy of Australia as a whole. That portion of Queensland north of Mackay would be completely dislocated if the sugar industry were injured or destroyed.

A commodity which has been traditionally protected by an embargo and is vital to the economy of a country should not be thrown into the melting pot and be subject to final decision by people other than ourselves. That would be quite possible under the agreement as -it now stands. Another danger is that we may waste a lot of our time, energy and influence in fighting for the right to preserve the embargo, whereas our time and energy should be expended in urging, when the international sugar agreement comes up again for review, that there should be a nearer approximation to world trade equality.

In the 1937 agreement Australia was allowed an international quota of 400,000 tons. The industry, as Senator Courtice knows better than I do, is most desirous of obtaining trade equality. The prospects of Australia achieving that result will be seriously diminished if the Australian delegates have to take their gloves off to fight the embargo. The other delegates will say, “ We may meet you on the question of the embargo, but we are not prepared to meet you in respect of the enlarged quota “. I urge that appropriate steps be taken to ensure, under general principles; that, any coInmodity which is traditionally protected in a .country, and is essential to the economy of that country, .be not made a matter of international bargaining or bickering. Sugar is in that category in Australia’s economy.

It would be wise and proper for us also to give consideration, from time to time, to the better organizing of trade. The term “ trade “ implies the production and transportation of goods; and before we can dot the “ i’s “ and cross the “ fs “ in agreements of this kind, we should consider whether we are doing all we can to produce the goods which will bie the subject-matter of such agreements. It is a very sad reflection that whilst the population of the world has increased by over 200,000,000 during the last ten years, the rate of world production has decreased during the same period. I admit that the recent war had some influence on the production. Honorable- senators who attended the screening of a film in this building last evening, will recall that the commentator, when dealing with conditions in middle Europe and the Middle East, said that over 100,000,000 people in those countries are underfed. Factory employment in this country increased from 539,000 workers in July, 1939, to 808,000 at the end of 1947, an increase of 50 per cent. The number of persons employed in our rural industries increased from 522,000 to 525,000, or an increase of only 1 per cent; whilst Commonwealth departments took the prize with an increase from 68,000 to 160,000 public servants, or 136 per cent., in . the same period. An examination of interstate and overseas shipping cargoes reveals a serious decline of Australia’s overseas trade, despite our increased production potential. In respect of interstate cargoes, the average monthly tonnage shifted in 1938-39 was 746,000 tons, whilst it decreased to 707j000 tons in 1946-47. The latest available figures show that in August, 1947, there was a slight increase to 714,000 tons. The monthly average of overseas cargoes discharged in Australia declined from 533,000 tons in 1938-39 to 464,000 in 1947, whilst in August, 1947, there was a slight improvement tb> 486,000 tons. The average monthly cargoes shipped overseas decreased from 519,000 tons in 1938-39 to 371,000 tons in 1946-47, whilst in August, 1947, there was a further decrease to 330,000 tons.

Those figures are alarming. There is no doubt that Australia at present has a wonderful opportunity to do for itself something which will be of lasting benefit in building up permanent industries in this country, and, at the same time, to make that contribution to the relief of world suffering which every Christian nation should make. But we are not making use of that opportunity. Any honorable senator who says- “ All is well with Australia’s production; everything is ‘ dunky-dory ‘ ; we could not be doing better “, is simply deluding himself. Certainly, at present, we are enjoying tremendous monetary buoyancy, but honorable senators opposite know as well as I do that many essential commodities are not obtainable in the community; that the lot of the housewife and the average small family man is harder now than it Was in the worst years of the war; that houses are more difficult to obtain ; and that some of the necessaries of life seem to be in shorter and shorter supply. The cause of that state of affairs is that a bad situation is being very badly handled by the Government. I do not blame the Government for the shortages; the point I make is that the Government is not facing up to the situation as it should. I emphasize the effective manner in which the Labour Government in Queensland dealt with those who not only would not work themselves but also tried to prevent others from working and endeavoured to destroy the fabric of industrial arbitration which has been set up in this country for the speedy settlement of disputes. The Queensland Government showed that the rule of law must reign. .The Premier of that State acted firmly and justly; and the strike ended with a victory for law and order. But compare the attitude of the Queensland Government in that matter with the dilly-dallying and shillyshallying of the Australian Government in handling similar disputes. The Queensland Government has no control, or jurisdiction, over waterside workers.

The Australian Government should face up to its responsibilities in similar circumstances. It should deal with industrial disputes as firmly as the Queensland Government dealt with the recent dispute in that State.

Apart from our moral obligation to trade with the Dutch, Australia is losing very valuable trade by not trading with the Netherlands East Indies. I doubt that we shall ever recover our trade with the Dutch. The point I emphasize is that the decision that we shall not trade with the Netherlands East Indies was made, not by the Australian Government, but by a mob outside which dictates to the Government. That mob simply declared : “ We shall not trade with the Netherlands East Indies “. What is the use of our making trade arrangements with from 40 to 60 nations unless the Australian Government alters its attitude and shows ii bit of backbone? Must it first obtain the imprimatur of the waterside workers before it can carry out these agreements. We have no guarantee that the waterside workers will not say : “ We do not like this agreement with Guatemala, or that agreement with Chile, and we will not allow ships to go to ‘those countries “. The waterside workers may issue an ultimatum in respect of these countries just as ruthlessly as they have done so in respect of trade with the Netherlands East Indies.

In order to ensure that our contribution to the world will be really worth while we must, first, produce to the utmost of our capacity and then ensure that our surplus products will be shifted to the destinations to which they are intended to be sent. The Government could make a, very substantial contribution in that direction. We shall then, as a people, have the satisfaction of knowing that we ‘are making a genuine and substantial effort to fashion the world after the pattern for which our lads fought - a better world with a larger measure of sunshine, decency and freedom for its small peoples, a world in which in not only this, but also other countries, people can lead quiet, simple lives free from economic strain an’d stress -and ‘any threat to their ‘freedom. I agree with the ‘general sentiment expressed the preamble to this agreement, that we should make some contribution to the establishment of the happier state of affairs it envisages; I believe, however, that the Agreement itself is so complex and contains so many provisos, “ not.withstandings “ and escape clauses that it will be ineffective. Although we must make whatever contribution within our ‘capacity is asked of us, the best contribution we can make towards world recovery is to establish still closer co-operation with our sister dominions and the Mother Country; because, in the final analysis, whatever the alignment of nations in another world dispute may be, we shall find the British Commonwealth of Nations and the great, Republic of the United States of America standing side by side. The closer we work with the United States of America, the more mutually advantageous agreements we can make with that country and with other Empire nations the greater the contribution that Australia will make towards world recovery.

Senator SHEEHAN (Victoria) r9.42]. - I have listened attentively to the speech just made by Senator O’Sullivan and I agree with his concluding remarks. Unfortunately, however, he deviated from the ideal which he advocated as a prerequisite for the establishment of a peaceful and prosperous society. He commenced by chiding honorable senators on this side of the chamber for patting themselves on the back, for placing halos around their heads, and for believing that all is well in Australia, because, in hi3 opinion all is wrong. I believe that through international trade agreements of this kind honest attempts are being made to deal with the great problems that confront the world. The student of history knows that the great wars in the past resulted from the drive for trade. Objection has been taken to the creation of various combinations of capitalists which formed themselves into monopolies and carved up the world into special fields which they could exploit. That state of affairs has caused wars. Within our generation we have had two world wars. After World War I. conferences were held from time to time between various nations in an effort to establish lasting peace, but those conferences failed because the proposals they adopted were not based on sound, scientific foundations. Following World War II. we now hope to bring about a set of conditions through the United Nations organization whch will obviate war in the future. A preparatory conference has been held at Geneva, and that has been followed by a conference at Havana where the international trade charter will be finally drafted. I believe that those two conferences will play an important part in preventing another world war. It is not possible for every nation to have its own way; there must be give and take. After all, that should be the spirit of any conference. Why attend a conference at all if one is not prepared to discuss matters reasonably, to hear what the other fellow has to say, to make concessions, and to agree to compromises so that a lasting agreement may be reached? From my reading of the proceedings of the Geneva and Havana conferences this spirit of compromise has been very much in evidence. It is true that some hard bargaining has been indulged in, but that is always likely to happen. The representatives of every nation will fight strenuously for the adoption of their own views. I am confident that the Australian delegation, led first by Dr. Coombs, and later by the Minister for Post-war Reconstruction (Mr. Dedman), has expressed forcibly and capably Australia’s views as a component part of the British Commonwealth of Nations. The tangible results of these conferences that we are now discussing are worthy documents.

I was interested to hear Senator O’sullivan say, after referring to the plight of. Great Britain, that the best that we could do for the people of that country was “ to give until it hurts “. I regret that that sentiment is not shared by some members of the Opposition in the House of Representatives, who, while debating these measures, maintained that Australia should drive the hardest possible bargain with the Mother County in regard to the sale of’ certain of our primary products. Consider, for instance, the attitude of members of the Australian Country party to the sale of Australian wheat. They are demanding the last shilling from the people of a warstricken country - a country which, it is our proud boast, stood alone against the great forces of evil in the’ early days of the war. Honorable senators opposite speak of patriotism and of what the Australian workers should do. We are told that the workers of this country must produce to the maximum of their capacity for the lowest possible wage ; yet members of a party representing a large section of the Australian people are pressing for the highest price for a. commodity of which there is a world shortage to-day. I have had an opportunity to see the people of Great Britain in their present trials mentioned by Senator Katz. I have seen the women of London and its environs standing for hours in queues, only to find on many occasions that there is not sufficient of the particular commodity that they wish to buy for everyqueue somewhere else, or wait until a later date. We should do everything possible to help these people. The remarks of the honorable member for Indi (Mr. McEwen) during the debate on the Government’s tariff proposals indicate clearly that his patriotism, and that of other members of his party, is governed by their pockets. They are certainly not prepared to give until it hurts.

I can understand that Senator O’sullivan is somewhat concerned about a commodity which is produced largely in Queensland. I refer, of course, to sugar. I shall be brief on this subject because I know that when the Minister for Trade and Customs (Senator Courtice) replies to the second-reading debate, he will deal with the matter most effectively. The Queensland sugar-growers have been assured by this Government that they will be fully protected. That was also made clear at the international trade conferences by members of the Australian delegation. I do not know why Senator O’Sullivan should question the sincerity of a Labour Government’s attitude to the Australian 911 ira r industry,because, after all, Labour administrations in Queensland and in the Commonwealth sphere brought the sugar agreement into existence, thus stabilizing the sugargrowing industry in that State. I am confident that in no circumstances would Labour risk disaster to something that it has created.

Senator O’Sullivan also drew attention to the fact that the export of goods from Australia has declined in recent years. His suggestion was, of course, that if Australia was to play its part in the world of the future, a greater effort would have to be made to increase production. The inference to be drawn from the honorable senator’s remarks is that the workers of this country are letting Australia down, and ignoring their obligations to other peoples of the world. He said that there were 4,000,000 underfed people in the world. Might I remind the honorable senator that one of the main purposes of the International Trade Organization is to ensure an adequate supply of foodstuffs to the starving millions throughout the world? I resent the suggestion that the Australian workers are not playing their part.

Senator O’Sullivan:

– Be fair. I did not say anything about the Australian workers.

Senator SHEEHAN:

– Referring to the position in Queensland the honorable senator said that there was a duty upon all of us to work to our utmost. The inference to be drawn from the production figures that he quoted was that the Australian worker had failed to produce the same quantities of goods as he produced in years gone by.

Senator O’Sullivan:

– That is so.

Senator SHEEHAN:

– The honorable senator failed to mention that for several years one of our greatest problems has been, not the production of goods, but the provision of sufficient shipping to carry them to other parts of the world. Whatever ships have traded to this country have left our shores fully laden, and I venture to say that had the number of those vessels been doubled or trebled, there would still have been sufficient goods available to enable them to carry away full cargoes. This lecturing of the Australian people on what they should do is not peculiar to Senator O’Sullivan or to members of the Australian Country party. There is a section of the community which continually lectures the Australian workers. It claims that because of the introduction of the 40-hour week production will be retarded. But those of us who are familiar with the history of the industrial movement in this country know that the same cry was raised when a 48-hour week was introduced. We were told that industry could not stand the reduction. Attempts were made to prevent workers from accepting the shorter working week. All sorts of devices were used by employers to try to break down the 48-hour week. Whenever there has been an attempt to give to the workers an adequate reward for the increased production that has resulted from the application of science and machinery to industry there have been these “ croakers “ who have said, “ This cannot be done “. I remember the introduction of the Wednesday half-holiday for shop assistants, when I was a lad. One storekeeper would stand at his door watching to see whether opposition establishments were closing, and, although the shops were supposed to close at 2 p.m., it was generally a quarter-past or half-past two o’clock before they closed their doors. The introduction of the half-holiday drew protests from shopkeepers who said that they would be ruined, and that the workers were refusing to carry on the industry of the country. Similar protests were made about Saturday afternoon closing, and in later years Friday night closing. It was said that there would be wholesale losses of trade, that people would not be able to get their week-end supplies, and so on. But, during the war, when the then Prime Minister, Mr. Curtin, went to Melbourne, be said “ Put out the lights! The enemy is at our gates. Close your shops “. The shops were closed and they have not been opened on Friday nights since. I am sure that even the proprietors of the stores would not now favour the reintroduction of Friday night shopping. The worker who to-day is withholding his labour power because he believes that he entitled to a greater reward for it than he has been receiving is no more blameworthy than are those people in our primary industries who withdrew from production during the war. Senator O’sullivan has criticized workers who are not producing .certain things because, owing to full employment, they ar.e able to sell their labour in other industries. I remind him that, during the war period when the Government was offering guaranteed prices to primary producers for potatoes, blue peas and other commodities, many .scores of dairy-farmers stopped producing milk and butter in order to engage in what, to them, was more lucrative employment. They could receive higher wages, so to speak, by transferring their labour from dairying to some other field of primary production.

The worker who withholds his labour from one industry, as Senator O’sullivan complains, and sells it in another industry is doing no more than is done by other citizens all over Australia. Manufacturers are doing the same sort of thing everywhere. If a. manufacturer can find a more ready market for his goods than the one where he sells them at the moment, he would be foolish as a business man not to take advantage of that market. Merchants know no country. They do not care where they find their markets so long as they obtain profits. It is good business for them, but apparently it is “ disloyalty “ on the part of the workers. Senator O’sullivan cannot have things both ways. I say that the Australian workman is doing a “ dashed good job “. His rate of production is as great as that of workmen in any other part of the world. At present he is going through a transitory period. He knows that only yesterday, as it were, many thousands of workmen were walking the streets of this country because there were no jobs for them. Many of them to-day are unable to give of their best in industry because they are suffering from the effects of malnutrition in those days. The fact that there is a shortage of man-power can be traced to the depression years, when the birth-rate in Australia fell very rapidly indeed. These are the ills that we have inherited from the maladministration of people who to-day malign the workers

We do not want to witness a ‘return of depression conditions, -and no doubt the workers are a little apprehensive at times about the possibility of such a tragedy. Therefore we should not blame them if, during this transitory -period, they stop to ask a question, to look where they are going. They may want to make the best use of the opportunities available to them to-day to better their conditions in life. They know that in the past, when there was a surfeit of labour and the old law of supply and demand was in operation, they had the worse end of the stick. Many people are too prone to condemn the workers when a little praise would not be out of place.

In conclusion, I hope that the conferences which are being held to resolve the questions which I have discussed will result in a better understanding throughout the world. I hope that people will come close together and thrash out their problems. In company with the High Commissioner for Australia in the United Kingdom, I had the opportunity to attend a food council meeting in London to discuss the distribution of foodstuffs. Many complex problems were presented for discussion by the men who attended that conference. We considered what the United Kingdom could get from Argentina in return for coal, what Australia could get from India or Ceylon in return for wheat, and many other such questions. All these problems had to be considered in making plans to provide the British people with a better standard menu than was available to them. If Australia should make some small concessions at international conferences, I consider that, by and large, the gains will outweigh the losses. We shall gain much in goodwill alone and demonstrate our ability to exert a greater influence upon world economic affairs than we have done in the past. The results will be well worth any slight sacrifices that may be’ made. We should give our wholehearted approval to the agreement that we are now considering.

Debate (on motion by Senator Grant) adjourned.

Senate adjourned at 10.6 p.m.

Cite as: Australia, Senate, Debates, 8 April 1948, viewed 22 October 2017, <http://historichansard.net/senate/1948/19480408_senate_18_196/>.