House of Representatives
19 March 1936

14th Parliament · 1st Session

Mr. Speaker (Hon. 6. J. Bell) took the chair at 2.30 p.m., and read prayers.

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– Has the attention of the Government been drawn to two separate cables from Tokio, Japan, published in the Australian press during the, last week, to the effect that there had been a complete change in the attitude of the Commonwealth Government in regard to trade treaties with Japan; and to the statement made by Mr. J. P. Abbott, president of the Graziers Association, in Sydney yesterday, to the effect that information hari reached him that the Federal Government intended to impose restrictions on Japanese imports. As evidently Mr. Abbott is obtaining information in regard to Government decisions which are not available to honorable members, will the Prime Minister make a full statement to the House on the matter ?

Minister without portfolio, directing negotiations for trade treaties · HENTY, VICTORIA · UAP

– There has been no material change in our trade treaty negotiations with the Government of Japan. In regard to the statements made by Mr. Abbott, the president of the Graziers Association, and other important members of that body yesterday, I desire to say that the Govern ment deplores the use of such irresponsible, dangerous, and foolish language as was used. There is nothing in the situation to merit it. Negotiations are proceeding even at this moment with the Japanese delegation to Australia.

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Report of Tariff Board


– Has the attention of the Minister for Trade and Customs been drawn to the statement in the Sunraysia Daily of tho 24th February last, that the Government is suppressing the report of the Tariff Hoard on agricultural implements? “Will the honorable gentleman state the exact position?

Minister for Trade and Customs · BALACLAVA, VICTORIA · UAP

– I think that all honorable members have seen this statement, which appeared not only in the Sunraysia Daily but also in the Shepparton Advertiser and other journals. It is a most irresponsible and foolish statement, the suggestion evidently being that the report of the Tariff Board on agricultural implements has been suppressed for some sinister reason. That report, I point out, was tabled in this House in March of last year. All honorable members have received a copy of it, and the press have made copious extracts from it.


– Although there is no truth in the statement that this report has been suppressed, will the honorable gentleman say why the Government has refrained from accepting the recommendation of the board concerning the duties on agricultural implements 1


– The new duties are printed in the memorandum which is being circulated to-day. When that item is reached honorable members will learn why the recommendation for a lowering of the foreign rates, which would have permitted the importation of American implements to the detriment of the Australian industry, was not accepted.

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The following paper was presented : -

Norfolk Island - Annual Report for year 1034-35.

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Sir Donald CAMERON:

– Will the Minister for Defence request the newlyappointed Civil Aviation Board to take the earliest opportunity to consider the matter of flying costs, with a view to their reduction, in order that aviation may be made more accessible to the youth of this country?

Minister for Defence · WARRINGAH, NEW SOUTH WALES · UAP

– The honorable member has brought this matter to my notice on several occasions. It will be one of the first matters to be placed before the newly-constituted Civil Aviation Board.

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– Has the attention of the Prime Minister been drawn to a statement in to-day’s Canberra Times setting out the amount of petrol tax raised between 1930 and 1935? If it is correct, will sonic alleviation be given to petrol taxpayers, particularly those who use commercial motor vehicles?

Prime Minister · WILMOT, TASMANIA · UAP

– My attention has not been drawn to this statement. All requests for relief from taxation will be reviewed before the budget for 1936-37 is submitted to Parliament.

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– Has the attention of the Minister for the Interior been directed to thepress statement to the effect that the work on the Red Hill to Port Pirie railway is to be carried out by sub-contracting? Is this permissible under the contract which was entered into with the Government? If it is, have steps been taken to ensure that the men employed under the sub-contract are paid not less than standard rates of wages, and that the conditions prescribed by our industrial laws are observed?

Minister for the Interior · GIPPSLAND, VICTORIA · CP

– It has been laid down very definitely that, in the case of any sub-contracting, proper wages must be paid by the contractor. I may say that in this connexion certain allegations came to my notice at the end of last week, with the result that the Commonwealth Commissioner of Railways has proceeded to South Australia to investigate the position.

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– I ask, Mr. Speaker, whether your attention has been directed to numerous leaks in the roof of Parliament House discovered during the recent rains? Will you give me the details of the expenditure from the fund provided by the Joint House Committee for roof maintenance and repairs to the House?

Is it a fact that portion of this fund was diverted to meet the cost of alterations to the Prime Minister’s offices in the House?

Mr. SPEAKER (Hon. G. J. Bell).My attention has not been directed, in recent months, to leakages in the roof of the House. An amount was expended upon the roof last year which I thought had met the situation, but I do not think that the honorable member would expect me to be able to give him, without notice, details of the expenditure. The amount expended on the Prime Minister’s rooms was not taken from any fund intended for expenditure on the roof of the House.

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– In view of the announcement made in the press by the chairman of the Commonwealth Bank Board to the effect that no more treasurybills would be issued to the public, has the Treasurer in bis possession any information to justify the assumption that those banks which raised their interest rates subsequent to the release of the treasury-bills will now reduce it again to the lower rate?


– I have no information on the subject other than that which has appeared in the press.

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Mr.FORDE. - I ask the Minister representing the Postmaster-General whether it is a fact that a person named Cecil Law is coming to Australia as a radio announcer for the Australian Broadcasting Commission? Can the honorable member also say why the commission considers it necessary to appoint an announcer from oversseas? Does it believe that Australians are not good enough for the position?


-I have no knowledge on this subject, for the Postmaster-General has not brought anything of this nature under my notice. If the honorable member will put his question on the notice-paper I shall obtain the information he seeks. I can, however, at once give an unequivocal denial to the last part of the question. It is not part of the policy of the commission to act in that way.

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– I ask the Prime Minister whether on account of public interests and to prevent possible misunderstanding as to the attitude of the Government, he will make available the full text of the air mail proposal submitted to the Commonwealth by the Government of the United Kingdom?


– This subject is still under negotiation and discussion between the respective governments. It is not, in my opinion, advisable to make public, at the moment, the details the honorable member desires, but a full statement will be made upon the subject as early as possible.

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– ,Will the Minister for Defence inform me whether the inquiries -promised by the Prime Minister into the obsolescence of the fortifications, and lack of adequate military equipment for the efficient defence of Hobart have been made, and, if so, what is the nature of the report?

Mr. ARCHDALE PARKHILL.That part of the Commonwealth will receive the same attention as other parts of it in regard to defence, and reference will be made to it when the new defence estimates are announced. I think what is to be done will be satisfactory to the honorable member.

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– I ask the Prime Minister to indicate what progress is being made by the Cabinet subcommittee which is investigating the possibility of re-opening the Newnes shale oilfield? Is the sub-committee considering a proposal to remit all excise duties on shale oil produced at Newnes as an added inducement to develop the field? Will the right honorable member also give some indication to the House of how much longer will be occupied to complete the sub-committee’s investigations?


– I have already replied to numerous questions relating to the Newnes shale oil industry and to other aspects of the coal and oil industries of Australia. The whole subject is under consideration, and that is the position at the moment.

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– Will the Treasurer inform me whether it is a fact that a sub-committee of statisticians has been engaged to furnish a report to the Government on national insurance? Is it true that the sub-committee, of which the Government Statistician and Actuary of Western Australia was a member, has completed its work? Is it practicable for the Government to place at the disposal of honorable members a copy of the report and any recommendations that have been made on the subject?


– Two eminent actuaries have been engaged for some little time in answering queries raised by the Government in connexion with national insurance. Their replies are not contained in any one document, but appear in a series of letters between them and myself. There is no one self-contained report that could be laid on the table of the House.

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Second Reading

Acting Minister for Commerce · Calare · CP

– I move-

That the bill be now read a second time.

I should like to explain to honorable members that this bill contains no vital alteration of the provisions of the principal act. It is introduced merely to overcome certain difficulties that have arisen which prevent the payment of advances under the act to certain States. It is proposed to amend section 6 (3) of the principal act in order to facilitate the payment of those advances. Section 6 (3) of the principal act reads -

No grant shall be made under this act to a State unless or until there is in force in the State legislation constituting an authority empowered on application being made to it, and at its discretion, to take action having the effect of suspending, either wholly or in part, the rights of any secured or unsecured creditor of a farmer against that farmer.

It is proposed to omit all the words after the word “ legislation “ and insert the following words: - “ which is declared by proclamation to be legislation which affords fanners reasonable facilities for relief in respect of debts owing by them.”

I desire to make clear to honorable members that the proposed amendment will not deprive the farmers of any rights which they possess under the principal act. I have made careful inquiries from the legal authorities, and have ascertained that the amendment will embrace all debts of farmers, secured and unsecured. Examination of the State acts has shown that, while they afford farmers reasonable facilities for relief in respect of debts owing by them, they do not strictly comply with the terms of section 6 (3) of the Commonwealth act. That section contains the main principle of the Commonwealth act, and so long as that principle is preserved, no rights are taken away from the farmers.

It is desired that this bill be passed expeditiously, because the Government of Victoria is pressing for the payment of £30,000, which cannot be met because of the existence of a legal difficulty that only an alteration of the principal act on the lines of the proposed amendment can remove.

Each State has passed legislation to give effect to the Commonwealth proposals for the composition of farmers’ debts, and the Commonwealth has arranged to grant to the States an amount, of £.1.2,000,000 for this purpose. Some States, however, have provided for the exception of certain debts, such as those incurred in respect of alimony, penalties imposed by a court, and other non-business debts, which could not legitimately be adjusted under a scheme of this kind, as they have no relation to farming operations. “Again, some States have provided for farmers to claim protection under the act, in order to enable them to secure credit or obtain machinery on terms. Honorable members will appreciate that, while the principal act remains in its original form, farmers in some of the States cannot obtain machinery or implements on extended terms because sellers have to face the risk that .(he farmers might obtain relief under farmers relief acts, or similar relief legislation, and obtain authority for the cessation of the payment due in respect of hire-purchase agreements. The result is that a considerable number of transactions in respect of farm machinery has been held up. It is proposed that the amendment shall be deemed to commence on the date of the commencement of the principal act. This is necessary, as certain States have already received advances from the Commonwealth fund.

The amendment to section 8 is purely a machinery amendment and deals with certificates to be supplied by the Commonwealth Auditor-General. It is proposed to omit sub-section (1) and insert the following sub-sections -

  1. 1 ) As soon as possible after the commencement of each half-year, the AuditorGeneral for the Commonwealth shall, in respect of each State, furnish to the Minister n certificate stating whether or not during the last preceding half-year, there has bi-en any breach by the Statu of the conditions of the grant. (1a) For the purposes of this section, the term “half-year” means half-year ending on the 30th duy of June or the 31st day of December.

As the act now stands, it is very difficult for the Auditor-General to comply with the conditions contained in section S (1), because insufficient time is given to him to prepare and present a report covering the preceding half year. The words of the section are rather difficult to interpret and it is proposed to simplify them in order that the obligations of the Auditor-General as to how and when the report shall be furnished shall be perfectly clear. I appeal to honorable members to expedite the passage of this bill. As I have said, the Victorian Government is anxious to obtain the sum of £30,000 due to it, and the Treasury cannot authorize payment until this bill has been passed.


.- Notwithstanding the explanation given by the Acting Minister for Commerce (Mr. Thorby), which I presume was made available to the various State governments, .there is a good deal of misapprehension as to the Government’s intentions in regard to the administration of the Loan (Farmers’ Debt Adjustment) Act 1935, as is evidenced by the following telegram which the Leader of the Opposition (Mr. Curtin) received from the Minister for Lands in Perth : -

Amendment to Commonwealth Farmers’ Debt Adjustment Act taking away power of trustees to suspend debts appears to me to destroy only opportunity reasonable debt adjustment. If trustees deprived power of suspension creditors will make difficulties about reasonable adjustment. My information gathered from press which may not fully explain position but shall be obliged if you will wire me full particulars.

In the Courier Mail of the 16th March, the following paragraph appeared: -

The Minister for Agriculture and Stock (Mr. Bulcock) said on Saturday that he was still awaiting from the Commonwealth authorities information respecting the proposed amendment of the Farmers Relief bill, and its effect on Queensland, and that the first intimation he had of the projected alteration was obtained from the newspapers.

He bad immediately telegraphed to Canberra seeking details, and had been informed that a. copy had been sent to him but hu had not yet received it. What chiefly concerned him was that although the Commonwealth Government agreed to the bill lie prepared, a copy of which was submitted to it, and had practically invited him to proceed with the passing of the necessary legislation, and although parliament had assented to the bill, no portion of the money for farmers’ rehabilitation had yet been received by Queensland from the Commonwealth. “Will the Acting Minister (Mr. Thorby) explain if there is any justification for the fears expressed by the Minister for Agriculture? The object of the bill is to amend a section inserted in the act on the motion of the honorable member for Gwydir (Mr. Abbott), which reads -

No grant shall be made under this act to a State unless or until there is in force in the State legislation constituting an authority empowered on application being made to it, and at its discretion, to take action having the effect of suspending either wholly or in part the rights of any secured or unsecured creditor of a farmer against that farmer.

The Assistant Minister, who moved the second reading of the bill in the Senate, said that an examination of the State acts indicated that, while the acts afford farmers reasonable facilities and protection for relief in respect of debts, they do not strictly comply with the terms of sub-section 3 of section 6. I understand from the remarks of the Acting Minister for Commerce that the powers conferred in the section which is being amended will not be affected materially by the amendment now proposed.

Mr Thorby:

– That is so.


– The Royal Commission on the Wheat Industry favoured a proposal to suspend debts, and pointed out that individual cases should be treated on their merits. When another measure was under discussion in this chamber, the honorable member for West Sydney (Mr.

Beasley) moved an amendment to provide for writing down either wholly or in part the liabilities of the farmers to any secured or unsecured creditor on a pro rata basis. The Assistant Minister in the Senate also said that some States have made provision for entering into agreements between debtors and creditors whereby the debtor undertakes not to seek a composition under this act. I should like the Acting Minister for Commerce to state whether in signing any such statement as to any future liability there is any possibility of guaranteeing farmers that they will be protected in the matter of old debts. For instance, a person who may require to purchase new machinery may be prepared to sign an agreement that he will not seek protection under this legislation. A machinery merchant might impose terms upon him providing that he can secure plant only on the condition that he agrees not to seek the protection of this legislation in the matter of old debts. We should therefore be careful to ensure that necessitous farmers really get breathing space to enable them to rehabilitate themselves. Many primary producers seeking to do business with such firms as Dalgety and Company Limited, or the New Zealand Loan and Mercantile Agency Limited, are asked to sign an agreement that they are borrowing outside the provisions framed to assist impecunious farmers. I believe that eventually something in the direction of writing-down farmers’ debts will have to be done in order to place Australian farmers on a sound economic basis. That proposal, however, when put forward by the honorable member for West Sydney, was defeated, and in its absence, the principle embodied in the principal act is perhaps the best that can be secured for the farmers from this Government. So long as an assurance is given by the Acting Minister that the courts established under this legislation shall be empowered to suspend either wholly or in part the legitimate debts of the farmers, I shall offer no opposition to the bill.


.- As I was responsible for moving the amendment incorporated in the principal act a few months ago, I feel that I should have a word or two to say on the subject. I rather agree with the Deputy Leader of the Opposition (Mr. Forde) that the time will eventually arrive when definite steps will have to be taken in connexion with the debt structure of many rural producers in Australia. I had that point in mind when I moved the amendment which was eventually embodied in the principal act. But, having the assurance of the Ac-ting Minister for Commerce (Mr. Thorby) that the deletion of the section mentioned, and the substitution of the words proposed, will not affect the principle of the act, I do not propose to offer any objection to the bill.

Mr. BERNARD CORSER (Wide Bay) [3.5 . - The amendment of the principal act proposed in this measure is of a technical nature to facilitate payments by the Commonwealth to certain States. I understand that the main principles are embodied in Commonwealth legislation and that the machinery for giving effect to them is to .be provided by the State parliaments. As it has been found impracticable to make payments to the States owing to certain anomalies, I should like the Acting Minister for Commerce (Mr. Thorby) to state if, when this amending measure is passed, it will be possible for payments to be made to the Queeusland Government, and to settle cases at present under consideration. If that is not so, can the Acting Minister say whether the Queensland legislation differs in any important particular from the Common-wealth act, and if the difference is sufficiently pronounced to prevent primary producers in Queensland from securing the benefit under this bill? “Were the provisions of the Commonwealth legislation agreed to by the representatives of the States at a conference with a -Commonwealth Minister? I know that the Commonwealth submitted an offer to the States on the understanding that the State representatives and the creditors concerned would confer with a view to relieving certain primary producers of their responsibilities. If no marked alteration has been made in that regard, and the ‘States are not prepared to take their share of debt relief it would to some extent interfere with the success of the scheme. When the bill which this measure is to amend was before the House it was stated that, although the Commonwealth was offering a grant of £12,000,000 to the States, it was hoped that when the whole of the details were available and the money had been allocated the scheme would have afforded relief to the amount of £50,000,000. If that is so, and no important principle has been departed from in the State legislation, is it the intention of the Commonwealth Government to convene a conference of the representatives of the States concerned?

Mr Thorby:

– That has been done.


– Has the difficulty been overcome?

Mr Thorby:

– I understand that a satisfactory solution has been reached.


– In the case of Queensland?

Mr Thorby:

– Yes.


– I trust that the Queensland Government will now agree to forgo some of the producers’’ obligations to it, and allow these payments to be made. I have never believed that this form of rehabilitation is the last word in the matter of relieving our primary producers. The form in which relief is now given does not fully meet the requirements of the farmers. I hope that this legislation is merely the starting point of relief to primary industries. The load of taxation upon it must be eased. A mere promise to the unfortunate farmers that they will be given relief is not sufficient. A complete scheme of relief must, within a short space of time, be placed upon the statute-book. I hope, however, that the passage of this legislation will enable the various States to distribute the £12,000,000 which was made available to them by the Commonwealth for the easing of the farmers’ debt obligations.

Darling Downs

– I am in agreement with the amendments contained in this legislation which I intend to support. The Loan (Farmers’ Debt Adjustment) Act 1935 is an act to authorize the raising and expending of certain sums of money to provide for the grant of financial assistance to the States in the making of payments to or for the benefit of farmers. It provides for a grant to the States for the definite purpose of giving financial assistance to assist in State schemes for the adjustment of farmers debts. In its original form the bill for that act contained the right principle, but the amendment moved by the honorable member for Gwydir (Mr. Abbott) and accepted by the Government introduced an element of danger, -which it is proposed to remove under this bill. This Parliament has a constitutional right to grant assistance to the States and impose conditions, but it is not legitimate to use that power for the purpose of forcing States to pass legislation. The amendment inserted in the principal act at the instance of the honorable member for Gwydir in effect was an exercise by the Commonwealth of control in a matter which should be more properly left in the discretion of the States. Those farmers who came under debt adjustment schemes of the States were within the purview of the States, and it was improper for the Commonwealth to interfere unduly. The States, however, found that their legislation was in conflict with the bankruptcy law; accordingly, they made representations to the Commonwealth, which resulted in this Parliament granting to the farmers coming under the State schemes of debt adjustment exemption from sequestration proceedings. The principle underlying the various schemes submitted by the States for enabling a composition of farmers’ debts to be made, required the payment ‘of certain amounts by the debtors, but these the debtors might not have and the Commonwealth Parliament granted sums to the States to be used to assist debtors to effect a composition. Accordingly, when the Loan (Farmers’ Debt Adjustment) Bill was introduced into this Parliament, clause 7 provided the conditions on which money granted by the Commonwealth could be disbursed by the States to bring about those compositions, but the honorable member for Gwydir moved an amendment which was inserted in the bill as subclause 3 of clause 6, as follows : -

No grant shall be made under this act to a State unless or until there is in force in the State legislation constituting an authority empowered on application being made to it, and at its discretion, to take action having the effect of suspending, either wholly or in part, the rights of any secured or unsecured creditor of a farmer against the farmer.

Mr Abbott:

– It was operating in three States.


– Yes, the effect of the honorable member’s amendment was to require each State to empower a State authority in the terms of the sub-section; otherwise they could not get a grant. Doubt has been raised as to the right of the Commonwealth Parliament to act in this way.


– It changed the principle laid down by the conference between the Minister for Commerce (Dr. Earle Page) and the State Ministers for Agriculture. °


– As a matter of fact the amendment was made in the wrong place. Section 7 deals with the conditions upon which grants are paid. Sub-section a indicates the general intention of Parliament -

The moneys shall be used by the State, in pursuance of a scheme authorized by or under the law of the State (in this section referred to as “ the State scheme “ ) , for the discharging of, in whole or in part, the debts of farmers by means of compositions or schemes of arrangement between farmers and any or all of their creditors; . . .

That is the general idea of the scheme, hut the amendment made to section 6 imposed an unwise condition on each State’s exercise of its powers. We should be satisfied with State legislation on this subject which offer reasonable facilities for relief in respect of debts owing by the farmers. The Government proposes to amend section 6 (3) and to substitute as the condition of the grant to the States the passage by them of legislation “ which is declared by proclamation to be legislation which affords farmers reasonable facilities for relief in respect of debts owing by them “. That is as far as the Commonwealth should go. The Commonwealth and States have a common purpose and for the Commonwealth to attempt to legislate upon matters of detail within the jurisdiction of the States is unwise. All that it is necessary to do is done in this bill which gives the Minister power to see that an appropriation of money is made and at the same time gives elasticity to the States.


.- The object of this bill is to offer relief to farmers in difficulties. Under the Loan (Farmers’ Debt Adjustment) Act 1935 £12,000,000 was made available to enable farmers to arrange compositions of their debts, to pay so much in the pound, and to suspend certain debts. The money was made available according to the State legislation which had either been introduced or was on the point of being introduced. When the Loan (Farmers’ Debt Adjustment) Bill was introduced in this House last year, honorable members from New South Wales complained about the provisions of the legislation which had been introduced in that State. Since then experience has shown that farmers have not received relief to the extent to which they are entitled. So acute has the position become in New South Wales in consequence of the reservations contained in the State legislation that early this year the farmers in various parts rose as a body, meetings were held and physical force was threatened by men who were determined to retain their properties, and the actions of the Government of New South Wales were condemned.


– Order ! The honorable member is not in order in discussing the whole principle of the legislation and its effect upon the farmers’ debt position. He must confine his remarks to the amendments.


– I take it that in altering the section of the act under which the money is to be expended, this Parliament should be made aware of the way in which ihe various States are to make the distributions and whether the legislation in the States offers the farmers reasonable facilities for obtaining relief. Many of the States have made provision which only enables the farmers to negotiate with their creditors. In New South Wales, I understand, of 460 farmers who had had stay orders executed, 71 have been removed from benefit, and are now left to the mercy of the winds, likely to be put off their properties. Altogether in New South Wales, 2A0O farmers come within the ambit of the act. In the early stages of the plan the Government of New South Wales induced farmers to bring themselves under the act, although many of them were not anxious to do so. This money is to be made available for the relief of the farmers, and I should like an assurance from the Minister that he will not permit farmers to be forced off the land. The original measure was passed hurriedly, and it seems to me that the present bill should have been brought down earlier. The Opposition cannot be blamed for the delay. I should like an assurance from the Government that farmers in New South Wales, whose stay orders are being lifted, will not be detrimentally affected by this bill, for they are the men who are most entitled to the relief being made available. Owing to the fact that farming is now on a more profitable basis than during recent years, prices having improved and land values having increased, many men who have become deeply indebted are in danger of losing their properties.


.- Obviously, it was necessary to bring down this amending bill, so that technical difficulties might be overcome, and, therefore, members of the Country party are quite prepared to support the measure. It is provided that State legislation must afford farmers reasonable facilities for obtaining relief in respect of debts, and I should like an assurance from the Minister in charge of the bill (Mr. Thorby) that the benefits of this measure will be extended to certain farmers who do not desire to avail themselves of stay orders. Quite a number of them could make a composition with their creditors if some of the money being made available were lent to them, but they do not desire to have their affairs taken charge of by a supervisor. The first condition of this control is that the supervisor is allowed to retain 3 per cent, of the aggregate production of the farm. If the farmer grew £1,000 worth of produce for the year, the supervisor would receive £30, yet the farmer must submit to a st3,v order to have his case considered. If the State authorities can provide a method by which cases of this kind can be dealt with without a stay order, will the Minister be satisfied to accept it as “ Providing reasonable facilities “ so that such farmers will be permitted to receive the relief afforded under the act? The money is not being lent to the States. It is provided by the Commonwealth, given to the States, and lent to the farmers. It is unwise to exclude the most deserving of these men, who have gone without luxuries in order to avoid having to accept the benefits of the Farmers’ Relief Act. They should be encouraged in retaining their independence, seeing that arrangements could be made to meet their debts by means of compositions.


.- The genesis of this bill takes us hack to the conference of Ministers of Agriculture from each State, which was summoned by the Minister for Commerce (Dr. Earle Page) some time ago. It was then agreed that certain principles should be embodied in the act, but, when the measure was under consideration, an amendment submitted by the honorable member for Gwydir (Mr. Abbott) and accepted, placed at a disadvantage those States that were making advances to farmers through their agricultural banks. These banks throughout the boom period, as well as during the depression, made money available to farmers at an interest rate 2 per cent, lower than that charged by the private banks. If the principle embodied in that amendment were allowed to operate, the Agricultural Bank of Queensland would suffer severely. The management of that institution “is a matter for the State itself. The charge has been made that the Minister for Agriculture in Queensland was instrumental in having a bill passed through the Pai”liament of that State exempting his government from making adjustments of farmers’ debts. That is a matter for the State government, which has carried the responsibility of financing farmers who are in difficulties. When a farmer’s lease has only eight or ten years to run, it is competent for the State to improve the asset by extending the lease by, say. 30 years. If the principle advanced by the honorable member for Gwydir had been adopted, a distinct advantage would have been given to private money lenders who had advanced money to the farmers. The Minister of Agriculture in Queensland has taken exception to this principle, because the Minister for Commerce, by accepting it, altered the effect of the agreement reached at the conference. The present position may be attributed to the practice adopted in this House last year of legislating by means of the gag and the guillotine. The attitude of the Queensland Government is due to its desire to protect the Agricultural Bank in that State. Rents of farming properties in Queensland, where most of the land is held on the leasehold system, have recently been reduced. I am anxious to learn from the Minister whether this legislation1 will affect the position of those small sheep-farmers on leasehold land, who are known in Queensland as selectors. Many of them hold properties which, in normal times, can carry 4,000 or 5,000 sheep, but which, owing to bad seasons, have not been able to carry more than, perhaps, 1,000 sheep for the last eight or nine years. The result is that they have got deeply into debt with the private banks.

Mr Thorby:

– If it is leasehold country, and the larger part of the debt is owing to the Crown, the selectors would, under the Queensland act, obtain very little relief.


– I have a case in mind in which a man holds a lease of 10,000 acres of land. The carrying capacity prior to the drought was 3,000 sheep, but during the last eleven years the property has not carried more than 1,000 sheep. To-day the man owes the private banks £10,000, and he owns no sheep. Following the recent rains, he now wishes to stock up again. His lease has ten years to run, and the State is prepared to extend the lease by another 30 years, as well as to increase it in size up to a living area. The bank, however, will not advance him money for more stock, because it maintains that he is overcapitalized, and that the increased area would not be sufficient to enable the bank to get its money back.

Mr Thorby:

– I cannot be expected to give a ruling in regard to individual cases.


– Commonwealth money is being made available for debt relief, but the small sheep-farmers, who have suffered probably more than any other section, apparently are to get nothing. We have distributed bounties and aids to practically every group of producers except the sheep-farmers, upon whom the prosperity of the country largely depends, and who all the time have had to pay high freights, high rents and high taxes. Evidently, there is no relief for these men, either in the principal act or in this amendment. In Queensland, as the result of the rains, thousands of farmers are urgently in need of debt adjustment.From Richmond north to the Gulf, the country could probably carry 1,000,000 sheep, but the graziers are not now ableto muster 20,000 sheep between them. I hope the Minister will give some explanation for the breaking of the agreement between the Minister for Commerce (Dr. Earle Page) and the Minister for Agriculture for Queensland, which followed upon the acceptance of the amendment of the honorable member for Gwydir (Mr. Abbott).

Acting Minister for Commerce · Calare · CP

in reply - The Deputy Leader of the Opposition (Mr. Forde) referred to disclaimers and old debts. Those matters are covered by State legislation. The position in regard to Queensland is as follows : - The Minister for Agriculture in the Queensland Government submitted a draft bill to the Commonwealth Crown Law authorities. It was reviewed by them, and certain information was supplied, and eventually the bill was passed through the Queensland Parliament. Unfortunately, that bill contained a clause which has caused a great deal of trouble, the clause being that which stipulates that the act shall not. apply to Crown debts.


– That was agreed to at the conference of Ministers for Agriculture, and it was the amendment of the honorable member for Gwydir which altered the position so far as the Commonwealth act was concerned.


– The Minister for Agriculture for Queensland understood that the Commonwealth would amend section 7 of the Commonwealth act so as to make it unnecessary for the Queensland Parliament to amend the corresponding section of the Queensland act. The same situation arose in Western Australia and South Australia, but there the State legislation was duly amended, with the result that now every State act, with the exception of the. Queensland act, complies with the requirements of the Commonwealth act. I understand that legal officers of the Commonwealth and the Queensland Governments have been in close consultation in an endeavour to overcome this difficulty. A simple solution, I understand, is now available, and if it be acceptable to the Minister for Agriculture in Queensland, it will facilitate the payment of this money.


– Was not the Queensland Government the first to pass the legislation, and has not a request since been forwarded to that government to amend the act in accordance with the amendment now moved by the Acting Minister for Commerce ?


– No. The honorable member is incorrect in stating that the amendment moved in this House by the honorable member for Gwyder (Mr. Abbott) caused a dislocation in Queensland. The amendment of sub-section 3 of section 6 of the act now proposed meets a difficulty now existing in Queensland, New South Wales, Victoria and Tasmania on other phases of the distribution of the money, but not in connexion with the particular section in the Queensland act, which states that its provisions shall not affect debts due to the Crown. This amendment will romove the other difficulties ; Queensland’s act will be the only one “that does not strictly comply with the Commonwealth act. Responsible officers of both the Commonwealth and State governments have been in consultation, and I understand that a satisfactory solution of the difficulty can be reached.


– If the act in Queensland is not complying with the Federal act why is it proposed to grant that State £1,300,000?


– The Commonwealth has not granted Queensland that money. The principal act makes the allocation on the condition that the State shall comply with the provisions laid down in section 7 of the act, which makes it very clear that no payment shall be made to a State which does not comply with the various sub-sections from a to i. I am asking the House to agree to a modification of the restriction placed in sub-section 3 of section 6 of the act, in order that the Commonwealth shall be enabled to make the proposed payments to the various States.

The honorable member for Riverina (Mr. Nock) asked for an assurance that relief should be made available to farmers without their having to accept a stay order. I am unable to give that assurance; that is a matter for the State authorities. In my opinion, honorable members would be well advised to allow the States the greatest possible latitude in exercising their powers in this connexion. The Commonwealth desires that each State shall submit its legislation to the Federal authorities, so that the GovernorGeneral may, by proclamation, declare that such legislation provides reasonable facilities for granting farmers relief in respect of their debts.


– Has the GovernorGeneral approved of the Queensland legislation ?


– No, but I hope that the Queensland Government will submit the measure for approval by the Commonwealth, in order that it may be proclaimed by the Governor-General.


– Have any payments been made to Queensland under this legislation ?


– No. Until this measure is passed it will be quite futile for Queensland to submit its legislation in its present form. It still contains a provision which will prevent it from being approved by the Governor-General. As I have indicated, however, this difficulty is being overcome by consultation between the technical officers of both Governments.


– The Queensland legislation at the present time is not acceptable to the Commonwealth Government?


– Not in its present form; but a solution is available. Even when this bill is passed, there will still be an obstacle in the Queensland act. In regard to the telegram from Western Australia read by the Deputy Leader of the Opposition (Mr. Forde), I give the honorable member a definite assurance that this amendment of the act will not take away the provisions of the principal act, as is feared by the Minister for Lands in Western Australia. It will not affect the rights of trustees or of trust estates. The amendment is a technical one, which will result in facilitating, instead of hampering, the payment of this money to the States. I ask honorable members to accept this assurance.

Question resolved in the affirmative.

Bill read a second time and reported from committee without amendment or debate; report adopted.

Bill - by leave - read a third time.

page 363


Customs Tariff Amendment (No. 3)

In Committee of Ways and Means: Consideration resumed from the 28th November (vide page 2133, Volume 147) on motion by Mr. White (vide page 2044, Volume 147)- (1.) That the Schedule to the Customs Tariffs 1933-

  1. be amended by inserting in that schedule, between the columns headed “ British Preferential Tariff” and “General Tariff”, a column headed “Intermediate Tariff”; and
  2. be further amended as set out in the Schedule to this Resolution.
Minister for Trade and Customs · Balaclava · UAP

.- The tariff schedule before the committee was laid upon the table of the House on the 28th November, 1935, and includes the schedules introduced on the 6th December, 1934, and the 28th March, 1935, together with another schedule introducing some new items relating to Tariff Board reports received between March and November. A comprehensive memorandum has been prepared and distributed among honorable members, and they can make comparisons between the proposed rates of duty under each item and the operative rates imposed by the 1933 tariffs. That, I hope, will save considerable time in the consideration of the items. As the new duties have been in operation for some considerable time, honorable members and the commercial world will have been able to judge their effect. But before proceeding to a detailed analysis of the effects of the tariff changes and our industrial progress thereunder, I think it may be helpful to honorable members if I indicate to them the principles on which the tariff-making policy of the Government is based. Tariff instruments are never easy to understand, and tariff-making is full of complexities and difficulties. This may also save time in the detailed discussions.

It will be remembered that in 1931 the Prime Minister enunciated his tariff policy, briefly, as follows: -

  1. Efficient industry as an essential qualification for tariff shelter;
  2. A reasonable, as distinct from a prohibitive, tariff level;
  3. Tariff-making, after public inquiry, through the Tariff Board, and not by arbitrary ministerial action.

That policy still stands, with provision for treaty-making which was endorsed at the last election. Within that general commercial policy a new principle has been adopted, namely, the adjustment of protective duties to exchange. As the decision of the Government to adjust protective duties to exchange has been criticized by two sections - one which states that no adjustment whatever should be made, and the other that the adjustment should be made to gold - I propose briefly to analyse the measures which have already been adopted and those which are now proposed by the Government on this vexed subject. Perhaps there is no measure more capable of affecting our national economy and our industrial progress for good or bad than a customs tariff. A well balanced and carefully considered tariff can assist in ensuring to the people with whose concurrence it has been imposed, economic employment, an adequate wage level and a high standard of living, with a reasonable return on capital investment. In case any freetraders survive in this country, I remind the committee that Adam Smith, the father of freetrade, writing before the industrial revolution, conceded that infant industries and also industries essential to defence are entitled to tariff protection. The tariff should also be framed so as not to retard, but to aid, the nation’s export industries. Provision must therefor be made for treaty making with best customer countries. That conception of a tariff visualizes it as a living organism, not as a dead instrument; as something resilient enough to respond to world changes and to enable industry to adjust itself to the many complex economic conditions, while remaining sufficiently rigid to withstand the pressure of interested groups or sections. A tariff therefore is never static; it must cope with the changes and complexities of an ever-varying world economy.

In a consideration of tariff policy, therefore, the inter-relationship of tariff and exchange cannot be ignored. The tariff had to be made to respond to the needs of commerce. Overproduction, with all the evils of monopoly, higher local prices and overseas retaliation, would have been the result had the Government not taken the exchange factor into account when assessing protective duties. Australia has pioneered a new field in this respect. Under the Ottawa agreement Australia is not required to make allowance for exchange. Nevertheless, it has done so over the whole range of its protective tariff. That has been done gladly in respect of the United Kingdom, our Homeland., which has at all times given a lead to the world.

In relating protective duties to exchange, sterling, not gold, was adopted as a basis. Several reasons actuated the Government in deciding to adopt sterling. First, there was the economic justification for relating it to sterling. Approximately 43 per cent. of our imports come from the United Kingdom and 56 per cent. of our exports are sent there. Secondly, the adoption of the gold basis would have involved a breach of the Ottawa agreement, as the margins of preference guaranteed to the United Kingdom would have been reduced. On the other hand, there was no obligation upon Australia under, the agreementto make any exchange adjustment, a concession which some critics apparently overlook. Thirdly, the gold basis would involve a departure from mostfavourednation treatment as among the foreign countries. It would give advantages to Germany and Italy as against other nations with which Australia has a more favorable trade balance.

At present two measures of exchange adjustment are operating. The first is the general exchange adjustment which has application to the British preferential tariff only. The second is the adoption of the (a) levels recommended by the Tariff Board. Generally speaking, this extends the adjustment to the British preferential, intermediate and general tariffs. Where it is applied, it supersedes the general method of applying it to the British preferential tariff only. The first system recommended by the Tariff Board was that a quarter of the duty, or one-eighth of the value, should be deducted while currency remained at £125, and that, on a return to £112 10s., the deduction would be halved. It was rather a rough and ready method. Since November, 1933, the Tariff Board has made more precise recommendations, and now the rate of duty allows for any appreciation of the Australian currency compared with sterling. It may be variable because in some instances the raw materials ‘are imported and in others the goods are entirely of Australian manufacture. With that system operating, there is also an automatic adjustment, so that if Australian currency appreciates towards sterling there will be a compensating increase of the duty. The position is made clear in both the schedule and the memorandum.

Another new feature of the schedule now before the committee is the intermediate tariff. It has been re-introduced to provide a convenient avenue for expressing the level of duties which the Government proposes should form the basis for trade treaties. The rates proposed under the protective items of the intermediate tariff express, in every case, a protective level for Australian industry as well as preserving the margins of preference required under the Ottawa agreement.

The rates of duty appearing in the general tariff column of the proposals represent a level midway between tha tariff board’s (a) findings for present condition and (6) findings for normal exchange conditions. This practice enables the Government to offer countries with which a trade treaty is contemplated a more favorable rate under the intermediate tariff.

The schedule contains a large number of items covering machinery, which is a further instalment of desirable tariff revision, since it removes many entries from the by-laws and places them plainly in the customs schedule. Moreover, the new schedule takes from the Minister the responsibility of having to decide whether certain machinery shall come in free of duty. The position is now made clear in the schedule in regard to hundreds of items.

Mr Mahoney:

– Would machinery required by Tasmania for its hydroelectric works come in free?


– If printed in the schedule, it would enter free of duty. Otherwise, any application for free entry would be considered. I feel sure that honorable members will agree with this clarification and enumeration. Previously, these articles were obscured under generic headings of the tariff. The list now incorporated in the schedule is the result of the activities of a voluntary trade committee presided over by an officer of the Department of Trade and Customs. Both manufacturing and importing interests were represented on the committee, which rendered a useful service. The principal beneficiaries are Australian manufacturers, who are thus enabled to modernize and extend their plant while keeping down capital costs, thereby aiding efficiency, and enabling consumer prices to be reduced.

Tariff changes generally are the result of Tariff Board inquiries, some necessitated by request* for further protection by Australian manufacturers, others in continuance of the work of tariff revision under the terms of the Ottawa obligation, and most of them rendered necessary through a much needed clarification of duty levels after the trade and industrial dislocation of the depression period.

Excesses in the tariff have now been removed, and protective duties have replaced those that were prohibitive. The difficult trading times through which the countries of the world have passed during recent years have upset some restrictionist dogmas of the past, and taught us that extremes in tariff-making can be exceedingly harmful. So great is the interdependence of one industry upon another, that ill-considered changes, giving one industry an advantage at the expense of others, ha3 proved often to be detrimental to the community as a whole, in dwindling trade and increasing unemployment, as well as retaliation by other countries and a forcing of the rate of currency depreciation. The other extreme of freetrade, with, its scramble for trade between nations of unequal standards and resources, is equally unsuited to Australia, where, since federation, there has been a protectionist fiscal policy, and where secondary industries have played a conspicuous part in the country’s development. It would be impossible for Australia, with its high living standard, to engage in competition with many nations and pay old-age pensions, and generally continue the humane legislation which has been placed on the statute-book. Obviously, as Australia has an overseas debt of many millions of pounds, funds must be raised to pay its overseas interest and exchange before dealing with its other commitments. In fact, without prosperous secondary industries as the prop and support for butter, dried fruit, sugar, wine, and now wheat marketing schemes, with profitable home prices, the lot of the primary producer would have been much more difficult, particularly during the period of greatest unemployment and lowest export prices.

Tariff Board inquiry has, therefore, been the prelude to most changes, and although in all cases the Government has not accepted the recommendations in full, as other factors, such as finance and defence, have to be considered, the result of its tariff revision is that by applying the lowest duty that protects, the consumer is protected as well as the producer. The honorable member for Swan (Mr. Gregory) has referred to the fact that the Government has declined to accept in full some of the recommendations of the board. I point out that we accepted its recommendations regarding the British rate, because, under the Ottawa agreement, we are obliged not to increase duties on British goods. We have fulfilled that undertaking gladly. In respect of foreign duties recommended by the board, for instance, on agricultural implements, we took the view that such duties may have resulted in an increase of imports of agricultural machinery, principally from the United States of America and Canada, to which we sell very little of our products. For these reasons, the Tariff Board’s recommendations in such instances were not accepted. In respect of tobacco also, the Govern ment did not accept the recommendation of the hoard, but preferred to assist local industry by instituting a higher rate of duty on foreign tobacco.

The Tariff Board, in its last annual report, says -

In some cases the reductions of duty have been recommended for the express purpose of forcing down local prices that are further out of step with world prices than conditions warrant; in other cases they have been recommended for the purpose of restricting local manufacture to lines capable of economic production and of permitting the importation without undue excess costs, of other lines. In very many instances, however, the reduction of dutyhas merely followed the comparative reduction of local costs, andhas assured to the consumers the advantage of equivalent lower selling prices. In a general way, it canbe said that while the reductions may have temporarily disturbed a few individual industries, the general prosperity and employing capacity of both exporting and home industries have been increased.

Mr Garden:

– That is bunkum !


– If he wishes the honorable member may quarrel with the Statistician’s figures, which I shall quote later. It must be obvious to honorable members that, especially in difficult economic times, advice resulting from open inquiries conducted by a skilled and impartial body such as the Tariff Board must be more reliable than any haphazard or rule-of-thumb decision made upon insufficient evidence. With timely notice of inquiry, too, commerce has flowed with the least hindrance, and the business world has been given the maximum of stability and tariff peace. I take this opportunity, therefore, to pay tribute to the useful and conscientious work of the Tariff Board.


– Then, why does the Government sometimes depart from the board’s recommendations?


– Perhaps the honorable member did not hear me say earlier in my speech that the Government has to consider factors, such as finance and defence, which are not taken into consideration by the Tariff Board.

Another aspect of the tariff revision under the Ottawa obligation is that preference to Britain has been restored and real reciprocity now operates. Previous excessive levels of the Labour regime had in a great measure lessened that preference, as both British and foreign rates were excessive, so that costs rose and there was a diminution of trade with, less employment. Now, with reasonable rates of duty operating which have lessened the opportunities for exploitation of certain industries which had taken excessive profits by a monopoly within Australia under the shelter of inordinately high duties, there is a greater volume of twoway trade that is of undoubted benefit to ourselves and Great Britain. To those who, without a knowledge of the facts, criticize the Ottawa agreement, I point out that our percentage of total exports to Great Britain rose from 50.67 per cent, in 1931 to 56.26 per cent, last year, or from £52,S00,000 to £63,500,000- from being the seventh largest exporter to the United Kingdom, Australia is now second only to the United States of America which has twenty times our population. I do not intend to dilate on export benefits at any length here; that is the province of my colleagues the Minister for Commerce and the Minister in charge of negotiations for trade treaties. It will suffice to say that the mutton and lamb trade was considerably assisted, if not saved from disaster, and that for our other exports, such as butter, wine, dried fruits sugar, canned and fresh fruit and the like, our best market for all exports was preserved to us and considerably enhanced. In fact 95 per cent, of our export wine, 83.5 per cent, of currants, 64 per cent, of sultanas, 93 per cent, of butter and cheese, 99 per cent, of eggs, 98.7 per cent, of lamb and 95.8 per cent, of mutton, 94.7 per cent, of pears, 83.5 per cent, of apples, 83.7 per cent, of sugar, 96.5 per cent, of canned pears, or an average of 89 per cent, has been bought by Britain.

Mr Garden:

– We have no quarrel with Great Britain.


– I am glad to hear that remark from the honorable member, who apparently has changed his tune. On the other hand there was a considerable diversion of foreign imports into British channels, for, although the sum total of our exports, less our overseas commitments, determines the value of imports, customs duties notwithstanding the tariff can regulate the flow of trade, making it one-way or two-way, and checking or accelerating its volume and direction. The Ottawa pacts have also materially strengthened the industrial economy of the United Kingdom. Since these agreements have become operative a large number of foreign industrial enterprises has been established in Britain and British and foreign industries have begun and expanded in Australia. The object of such establishment has been to retain their trade with the British Empire by means of the tariff preferences mutually accorded. This development has real significance, and has been the means of strengthening the Empire as a whole, a factor of immense importance during difficult international times such as the present, when the Empire stands as a leader of the world. The diversion of trade to Empire channels through the Ottawa agreement has benefited all parts of the British Empire, Australia, as I have shown, being an important beneficiary. The following tables summarize the increasing two-way trade between Australia and the United Kingdom, and show, among other increases, that the value of goods imported from Great Britain in 1935 was £7,500,000 more than in 1931. In this regard Australia has an excellent record since introducing a preferential tariff with Great Britain in 1908, being second only to India as a purchaser for many years, then dropping to ninth place in 1931, but recovering to third position in 1932.

“Whilst the Ottawa agreement is not without its critics, most of whom have not analysed the statistics, it3 advantages are obvious, and its imperfections and shortcomings are being observed, and can be adjusted at its revision next year. That the dominions and colonies within the Empire, often with a competitive and conflicting trade view, should have succeeded in obtaining such a measure of Empire reciprocity during a period of world diminution of trade, shows that this great Empire co-operative effort wa3 abundantly worth while, and stands as an example to the world, not as an Empire prosperous among povertystricken neighbours, but as a useful lead in a generally improving world.

As apprehension regarding the trade balance has been the subject of a recent debate in this House, there is no need to enlarge upon the subject hero. It is important to remember, however, that a young nation with great possibilities of development does not measure its progress by a single trading year. Men and money for the development of its resources pouring into a rising young country can make its trade balance adverse, especially if it is a debtor country which has borrowed heavily for development, as we have, whereas an old nation in which the people are draining out, and whose overseas investments are being sold off, could on that account show a favorable balance. A balance in either case, therefore, may mean adversity or prosperity. The extent of our imports, except for new money coming in in the form of goods, is of course limited by the total of our exports, less the amount of overseas commitment. “With Australia there is also a lag, following high export prices.

The present volume of imports is of course largely the result of higher wool and wheat prices, which have permitted much industrial rehabilitation and replacement, and, together with returning purchasing power to the community through increased employment, a larger purchase of luxury and semi-luxury lines.

A dissection of the imports clearly indicates that they are mostly employmentgiving, consisting mainly of capital goods, raw materials, tools of trade, motor chassis, and oils. Prominent among these, showing an increase in amount for the seven months of 1935-36 over the same period of 1932-33, are: motor chassis, £2,940,000; machinery, £2,597,000; metals, including steel, galvanized iron and tools of trade, £2,452,000; cable and electric appliances, £946,000; oils and materials for paints, and drugs and chemicals, £S86,000; minerals, crude rubber, hides, &c, £1,142,000.

Their benefit upon employment is obvious when we consider the immense amount of work given in motor-body building and motor-car accessory manufacture; the stimulus to mining by the waiving of duty under by-law on much mining machinery, and the importation of electric motive power machinery not made in Australia, metal working machines, yarn-marking and textilemaking machinery, printing machinery, electric cable, and the like. The steels imported are of a type or size not made in Australia, while galvanized iron to the value of £250,000 was admitted under by-law because of the inability of the local mills, in spite of extensions to their works, to cope with the phenomenal increase of building. In fact a complete survey has been made of the principal imports, which, in the seven months of 1935-36, are in excess of those for 1932-33. For this information I refer honorable members to appendix “ A “, which they will find at the end of the report of my speech.

Since October, 1933, the Trade and Customs Department has dissected imports into protective and nonprotective groups. This dissection arises out of the adjustment made to duties on account of exchange. From it can be ascertained the value of imports which are competitive with Australian production. The following figures are most interesting as indicating that most of our imports are non-competitive with Australian production.

It is a relatively simple matter to pile on tariff increases to rectify an adverse trade balance. Such action, however, operates harshly upon employment and commerce generally; and the more prudent and successful course of tariffmaking has been to discriminate wisely in imports so that employment and development are at all times being encouraged. Moreover, if the tariff is used to correct an unsound trading position, the greatest care must be exercised to ensure that our existing export trade is not imperilled by retaliatory action by good customer countries.

I have already shown in a previous debate that actually there is little more importation now on the 73 items that were prohibited and the 64 items on which 50 per cent, surcharges were made, than there was during the period of those excessive duties. The statistics show that there has been a great revival of industry. Other barometers which register industrial progress and expansion are factory production, building, employment and unemployment, share capital indices, and profits from manufacturing indus- tries. The added value of factory production has steadily increased from £111,000.000 in 1931-32 to £140,000,000 in 1934-35. The value of the output from factories in 1931-32 was £2S2,000,000, while it is estimated that in 1934-35 the value will have been £360,000,000.

The value of the building permits issued in the six capital cities and suburbs has been as follows: -

The factory employment figures in 1926-27 were 452,000. They fell to 337,000 in 1931-32, and increased to 45.1,000 in 1934-35. The figures for the quarter ended December, 1935, showed that there were then 459,000 persons in employment in factories - the highest factory employment in the history of Australia.

General unemployment reached it3 peak in the second quarter of 1932, when 30 per cent, were unemployed. This was reduced to 13.7 per cent, in the fourth quarter of 1935.

The Sydney Stock Exchange index of 23 manufacturing and distributing companies, shows a rise in share quotations from 77.3 per cent, of par value in July, 1931, to 183.7 per cent, of par value in December, 1935.

The net profit earned by 62 manufacturing companies in 1931 was £1,272,000, whilst in 1935 the profits had risen to £1,654.000.

Obviously, the Government’s tariff changes to date have assisted in encouraging considerable expansion and development, and in a phenomena] trade revival that has lifted Australia back to prosperity again. Without some of the duties they enjoy, certain industries could not live, while a careful revision of rates has assisted others, improved our twoway trade, and been generally beneficial to the nation.

The facts I have disclosed should effectively answer any criticism to the effect that the Government’s tariff policy has injured any economic Australian industry. An impartial view will confirm the claim that very few countries are living in greater prosperity than is enjoyed by Australia to-day.

I ask the committee to accept the schedule as a further substantial instalment of a policy that has been successful in fostering Australian industries and aiding our progress and development.

page 370


Survey of Seven Months Impost Trade in 1935-30, as Compared with the Import Trade in the Corresponding Period of 1932-33.

Imports for the seven months ended 31st January, 1936 (the latest period for which detailed statistics are available for comparative purposes) were £16,000,000 (sterling) higher than for the corresponding periods of 1932-33 and 1933-34.

Comparing imports in the current year with those in the similar period of 1932-33. the machinery and metals group account for £9,000,000 (sterling) of the total increase.

Out of 32 statistical subdivisions there are only three in which the excess of imports this year over imports in the corresponding seven months period ending the 31st January, 1933, is more than £500,000. They are -

A surveyof all statistical sub-groups in which trade exceeds £100,000 shows that the balance of the additional imports is distributed over the following commodities. The extent of the increase is shown against each.

Raw materials (indicated with an asterisk) for use in manufacturing and other industries figure conspicuously throughout the foregoing list, and reflect the increased industrial activity.Forexample, the marked expansion in the building and allied industry can be seen in the higher imports of timber, paint materials, linseed, plate glass, and crude asbestos.

As previously indicated, the major increase occurs in the machineryand metals groups. In every subdivision excepting sheep-shearing machines, dairying machinery and pig iron, an increase is recorded. The most conspicuous increase in a single item, however, occurs in motor chassis andparts, which rose from £839,000 (sterling) in 1932-33 to £3,091,000 in 1935-36.

The following tables cover the entire machinery and metals groups: -

In the machines groupare reflected the growth and extension of electric light and power installations (cable and covered wire, dynamos, filament lamps), increased activity in the wireless manufacturing industry (wireless valves and wireless parts), greater activity in the mining industry (mining machinery)”, extensions in the engineering industry (metalworking machinery), and increased industrial activity generally ( machines, other).

Noteworthy features in the metals group are the increased imports of various ferrous and non-ferrous alloys; and aluminium blocks and aluminium sheet; special bar steels; hoop iron; metal foil (used in wrapping confectionery and cheese and making condensers ) ; galvanized iron (inability of Australian producers to meet great expansion in demand for building industry) : plain steel sheet (used in making motor panels); tinned sheet (canning industry) ; hooks and eyes; wires of various kinds - mainly fine wire and tinned wire; tools of trade.


.- The Labour party approaches this tariff debate with the knowledge that it has not wavered one iota from the protectionist policy for which it has stood for many years. Experience has shown that that policy is the best for Australia. That is definitely laid down in the platform of the Australian Labour party which, in this connexion, reads -

  1. Effective tariff protection of Australian industries, with measures to prevent profiteering and to assure industrial protection to workers.
  2. Import embargoes, if necessary, to assure the home market to Australian industries capable of fully supplying the demand, subject to control of prices and of industrial conditions, Australian standards.

Some caustic remarks Lave been made this afternoon about the tariff policy of the Scullin Government. I remind honorable members that when that Government assumed office it was faced with two great responsibilties : first, the protection of Australian industries, and, secondly, the rectification of our adverse trade balance. It had received a definite mandate from the people to deal with these subjects, aud it tackled them courageously. Much of the improvement in the trading conditions, employment, and general financial position of the Commonwealth to-day is due to the policy put into operation by the Scullin Government. Although the difficulties due to the depression became accentuated in the first year or two that that Government was in office - difficulties which were in no sense clue to its administration or the legislation it introduced, but were due to world-wide conditions - a substantial improvementwas effected in the extent of employment provided by a number of the major Australian secondary industries. In the woollen and worsted industry, employment was found in Australia, in 1928-29, for 11,400 persons, whereas in 1931-32, in the very trough of the depression, employment had increased by 2,260 to 13,600. In the hosiery industry employment was provided, in 1928-29, for 11,519 persons, and in 1931-32 for 12,500 persons, an increase of 1,000. The number of persons employed in our cotton spinning mills increased from 950 in 1928-29 to 1,650 in 1931-32. Comparative figures for certain other industries are- Knitting mills, 192S-29, 11,500: 1931-32, 12,500; wireless manufacturing, a few hundred to 2,000; galvanized iron manufacturing, 800 to 1,200 ; dry battery manufacturing, 85 to 600. I mention these facts to show that during the depression the protectionist policy ‘of the Scullin Government not only arrested the tendency towards greater unemployment in these and a good many other industries that I could mention, but also substantially increased employment, notwithstanding that the depression was becoming more and more acute. Had it not been for the strong action taken by that government to rectify our adverse trade balance - concern- ing which little was said this afternoon by the Minister for Trade and Customs (Mr. White) - Australia would have defaulted. During the period that the Bruce-Page Government was in office our trade balance drifted by £70,000,000, but in consequence of the policy of the Scullin Government, which involved the imposition of prohibitions, the rationing of imports and substantial increases of duty on what might be called luxuries and goods that could be manufactured in Australia, an adverse trade balance of £34,000,000 in one year was converted to a favorable trade balance of £30,000,000 two years later. Naturally, the taking of such drastic steps as those which I have indicated interfered with the business of certain importing interests in this country, and trade was dislocated in some directions, but strong action had to be taken to grapple with the difficulties that had been gradually becoming more serious over a number of years owing to the inaction of the Bruce-Page Government. In fact, that Government by its policy of borrowing overseas to the amount of £40,000,000 a year aided and abetted certain commercial interests in bringing about a state of affairs that constituted a grave menace to the Commonwealth. This money came into Australia largely in the form of imported goods.

Since the present Government has been in office, numerous tariff changes have been effected. The present Minister for Trade and Customs was responsible for the introduction of three major alterations of the tariff schedule between the 1st December, 1934, and the 30th November, 1935. In the schedule put forward in November last, reductions were effected in no fewer than 268 tariff items, bringing the total reductions for the twelve months up to 1,054. All the prohibitions imposed as emergency measures, which were effective when the Ottawa agreement was signed, have been removed. All surcharges on goods, affecting 32 items of the tariff, have been abolished. Goods from the United Kingdom coming within 149 tariff items and sub-items have been exempt from primage; and goods affected by 650 other tariff items and sub-items are now liable to only half the former primage duty. Duties within the scope of the British preferential tariff have been reduced by one-fourth. Moreover, a new formula has been adopted to arrive at the rates of duty on goods under the British preferential tariff to offset the protective effect of exchange. Of the 300 tariff items that have been reviewed by the Tariff Board, 285 now carry duties lower than those which operated in 1932. In these circumstances it is no wonder that the Bight Honorable W. A. Watt, a former Commonwealth Treasurer, and a gentleman held in the highest esteem by honorable members of all parties of the Commonwealth Parliament, commented caustically on the policy of the present Government in an eloquent speech which he delivered to members of the Australian Industries Preservation League. He said -

The existing atmosphere of doubt and anxiety arises from the existence of what is popularly known as the “ Ottawa agreement “.

The Minister claimed great credit this afternoon for the Ottawa agreement, but his predecessor in the representation of the Balaclava division in this Parliament evidently holds quite a different idea. Mr. Watt went on to say -

Let me take the words of clause 10 of the agreement. By it the British producer is guaranteed “ Full opportunity of reasons Mp competition on the basis of the relative cost of economical and efficient production.” To my mind that guarantee constitutes, most definitely, a challenge .to the protectionist system of Australia. The main objective of the protectionist was to give to the Australian manufacturer a very definite advantage in his home market. If you will read clause 12 of the agreement, you will observe that “No existing duty shall be increased on United Kingdom goods to an amount in excess of the recommendation of the tariff tribunal.” Does this not give an enormous stretch of authority to the board?

He then referred to paragraph 12 of the Ottawa agreement in the following way:-

The phraseology of clause 12, and the practice followed, is equivalent to handing over the powers of responsible Ministers to a body of mcn who do not represent .the people in any constitutional sense.

Mr Parkhill:

– That was four years ago.

Mr Scullin:

– The Minister for Defence should not interrupt.


– I have cited these remarks by Mr. Watt, because he was a member of the Nationalist party and -the representative of the Balaclava division in this Parliament and during his association with it, held some of the highest public positions in the country.

Honorable members interjecting,

Mr Curtin:

– I rise to a point of order. The Deputy Leader of the Opposition (Mr. Forde) has, during his speech, been subjected to derisive applause and repeated interjections by honorable members opposite. Their conduct is not only disorderly but grossly unfair, and is in marked contrast to the decorum that was observed while the Minister for Trade and Customs was delivering his speech. I ask that similar consideration be extended to my colleague.


- (Mr. E. F. Harrison). - There is a good deal in what the Leader of the Opposition has said, and I ask honorable members to maintain silence while the Deputy Leader of the Opposition continues his speech.


– Without any doubt the protectionist policy put into operation by the Scullin Government waa sound from a defence point of view. The effective defence of Australia depends to a large extent upon the industrializa tion of the nation. This is clearly shown by the experience of Great Britain and Sweden. At the beginning of the eighteenth century the population of those two countries was much the same; but England became industrialized and increased its population from about 9,000.000 to 45,000,000, whereas Sweden, which did not become industrialized to any great extent, did not greatly increase its population. Where would Australia be without its great key industries associated with steel, coal and wool? The steel works of the Broken Hill Proprietary Company Limited, at Newcastle, are of tremendous importance to Australia for defence purposes. Obviously it is necessary to open up avenues of employment in Australia, but we find that one party supporting this Government is trying its best to set the primary producers against the manufacturers, although it should be realized that our primary and secondary industries are inter-dependent.

The primary industries cannot make progress without the support of the secondary industries. In consequence of the growth of economic nationalism in other countries the Australian primary producers will have to look more and more to the local market for support. They must realize to an increasing extent their dependence upon the people of Australia for a market for their goods. Nearly 450,000 persons are directly employed in the secondary industries of Australia, and annually they receive wages which aggregate about £65,000,000. The importance of the home market can be realized by considering the following facts which have been stated by the Commonwealth Statistician : -

Australia, being a debtor nation, must export sufficient goods ito pay for its imports and also to meet interest charges. We have had experience of what happens when a government flirts with freetrade. Such a policy causes a tremendous drift of the trade balance. In fact the drift was so great towards the end of the regime of the Bruce-Page Government, that Australia was faced with the possibility of default and would actually have defaulted had not the Scullin Government taken drastic action to rectify the position. Since the present government has been in office, the trade balance has once more been allowed to drift. This is the result of the continuous reductions of duties for which this Government is responsible. Since the Lyons Government has been in office, the volume of imports has increased greatly. Between 1931-32 and 1934-35, for example, the value of our imports increased by £28,000,000 and that of our exports by only £5,000,000. This has been due to the Government’s indifference and its readiness to resort to measures of political expediency to meet the fiscal views of the Country party. The Government has shown itself to be to impotent to deal with the drift in our trade balance, that recently the Commonwealth Bank Board was forced to take a step which it has since been obliged to retrace. The first action by the bank board became necessary because the Government was not prepared to shoulder the responsibility of rectifying the adverse trade balance. It is frequently said by those who want to tear down the tariff wall that Australia is a primary-producing country, and must depend upon its exports. The value of the output of Australian manufactures for the last five years was £1,688,000,000, whereas the value of the three main classes of primary production - crops, wool and dairying - amounted to £1,080,000,000, or £608,000,000 less than the value of our manufactures. Those figures, I .think, demonstrated that Australia does not live on its exports. In the same period the value of our exports totalled £570,000,000, but the value of raw materials consumed in Australian factories was £958,000,000, or £388,000,000 greater.

The aims of the tariff protection for which the Labour party stands may be divided into two kinds - economic and non-economic. The latter may be summarized as follows: First, a country is inferior in status if it does not possess and develop industries such as are established in other advanced countries; for Australia to be mainly dependent upon primary industries would be to place its people in the position ot hewers of wood and drawers of water for the people of more favoured countries. Secondly, a diversity of industry and employment is a social advantage, making for greater versatility and the development of various aptitudes in the population, and generally promoting a fuller and richer national life. A country should be as independent and selfcontained as possible in order that it may he less vulnerable to the effects of any war that might disturb the markets abroad. Thirdly, certain industries are specially desirable, directly for armaments, or in case essential supplies are cut off, or to promote the population of vulnerable areas, such as tropical Queensland.

The economic advantages of tariff protection are briefly: First, protection promotes new industries and employment, and therefore additional industries and employment. Secondly, it follows because of the added demand from new industries that protection enlarges the home market for all industries, including the primary industries and all that are unprotected. Thirdly, local competition and the increasing scale of .production reduce prices, in many instances, even below the prices of free imports. Fourthly, the tariff reduces imports, and therefore lessens the burden of payments overseas. I think it must be admitted that the tariff also protects wages and labour conditions from the competition of lowwage countries, ensures greater stability in production by promoting industries not at the mercy of the seasons, and reduces dependence on the vagaries of foreign markets in normal times, especially for staple products such as wool and wheat. Writing, in 1930, in his book Australia To-day, Professor Copland, of the Melbourne University, put his views in the following words: -

There is a belief that primary production is more important to a country than manufacturing. This is a mistaken view, and it has led to much misunderstanding concerning the contribution made by manufacturing industries to the national income and the economic prosperity of the country.

He quoted figures showing that in 1919 there were 444,000 persons engaged in farming, dairying, and pastoral industries, and 323,000 in manufacturing industries, while in 1929 the numbers were 419,000 and 450,000, a decrease of 25,000 and an increase of 127,000 respectively. Another eminent economist, Professor Giblin, in his book Australia 1930, wrote -

It is to be expected that our future development in Australia must be chiefly by secondary industries. If we cannot succeed in efficient secondary industry, then our growth will be very small and fitful. If an attempt is made at present to extend in primary industries it will be to knock our heads against a brick wall.

If we as a party have made mistakes in the past, in the way of high duties, we have erred, not on the side of the foreign trader, but on the side of Australian manufacturers and workmen. Australia, has a population of 6,700,000 persons, and, according to the latest statistics, there are 250,000 unemployed and 1,000,000 receiving some form of charity. Listening to the Minister’s speech, one would believe that this country had become a modern Utopia, hut with nearly 1,000,000 persons in want and 250,000 directly out of employment, a great deal more has to be done before the Government oan claim that it has implemented the promises made by its supporters before the last two federal elections that its chief concern would be to put jobless people back to work. As a matter of fact, not one action of the present Government has contributed towards the honouring of that promise. A general improvement of our export trade, increases of price levels overseas, giving us millions more per annum for wool,, wheat and butter, and increased expenditure by the State governments on loan works, have absorbed a large number of people. All State governments, irrespective of party, claim, the credit for the improvement of conditions. Yet the Minister this afternoon claimed all the credit for the Commonwealth Government.

Mr White:

– Nonsense! What the Commonwealth Government claims is a substantial share of the credit.


– If credit is due to any government, it is due to the Scullin Government, which rectified the adverse trade balance, laid the foundations for big development in secondary industries, and place’d this country on an even keel, so that it became able to rehabilitate itself economically. It is easy to say, as a prominent British writer recently said, that Australia can hold so many more millions of people ; but that is not the end of the matter. It is not even the beginning. Such factors as climate, soil, rainfall, economic capacity, markets, internal and external, and many others call for consideration and careful examination before details of migration resumption can be seriously considered. This Government, it is said, has had under consideration a proposal for the resumption of migration, but it has not come forward with any definite policy, being content, apparently, to wait for something to turn up. There are elements in the Government that would like to flood this country with hundreds of thousands of people from the Old Country without any organized developmental scheme in Australia, and this would accentuate the troubles of our unemployed. “We owe our first duty to our 250,000 workless people, and we can assist them through the tariff by the further development of secondary industries. Every year, 90,500 children under the age of sixteen years leave school, 40,500 of whom search in vain for employment. Surely we owe a duty to them.

Mr White:

– How does the honorable member suggest that they could be absorbed ?


– The only way in which they can be absorbed is by a scientific development side by side of primary and secondary industries, and not by the onesided policy for which a section of this Government stands, or a two-ways policy for which another section stands, one week having one foot in the free-trade camp, and the next week, after attending a manufacturers’ dinner, having the other foot in the manufacturers’ camp. The Minister for Trade and Customs at a recent dinner said that Australia’s best defence was the nation’s man-power, that we need more people here, and that only by internal prosperity would man-power be attracted to Australia. There is nothing wrong with those sentiments, but they come strangely from the lips of a member of a Ministry which has done all it could to reduce tariffs and has retarded Australian development. A greater number of people would have been employed in secondary industries but for the tariff reductions, which made possible a substantial increase of imports. Taking the Minister’s own figures, which, no doubt, have been carefully prepared to suit his own argument, 14 per cent, of the imports are competitive with Australianmade goods. Fourteen per cent, of a total of, say, £72,000,000 is approximately £10,000,000. That is the value of the imports which the honorable gentleman admits are competitive with the products of Australian factories. Comparing the month of July, 1934, with the same month of 1935, we find that the value of imports has increased from £5,400,000 to £6,400,000. The figures for January, 1936, show an increase of £1,700,000 over those for the same month in the preceding year. For the period July to January, 1934-35, our total imports were valued at £43,000,000, and for the same period in 1935-36, £50,000,000. The following table shows the progressive increase of imports : -

For the seven months ended January, 3936, imports into Australia have increased by £7,100,000, and, due to the meddlesome tariff policy of the present Government, our favorable trade balance dropped from £40,635,000 in 1931-32 to £16,105,000 in 1934-35, and for the seven months ending the 31st January. 1936, to £10,600,000. Those who flirt with lowtariffs and. freetrade between countries over-estimate the value of external trade and under-estimate the preponderating value of our own manufactures. It is well that we should compare the worth of our import and export trade with the value of our manufactures. The popular misconception on this subject was revealed by the economists’ deputed by the Bruce-Page Government to examine and report on it. They said -

The importance of international or external trade is commonly exaggerated. It is always small in proportion to domestic trade; and its volume is no indication of the prosperity of a community. But popular attention is concentrated upon international trade because records are kept which make it conspicuous, and national boundaries give opportunities for its taxation and regulation.

That passage states the position fairly. The increasing proportion of locally manufactured goods used, involving increased purchases of locally-produced raw materials for treatment in Australian factories, substantiates that statement. The comparative values of several forms of our commercial activities are shown in the following table: -

The statistics covering imports and exports for 1934-35 areas follows: Imports £111s. 2d. per capita, an increase of £1 17s. l1d., compared with 1933-34. Exports £13 9s. 3d. per capita, or a decrease of £11s. l0d. compared with 1933-34. The preliminary semi-official figures in respect of manufacturing industries are £53 13s. per capita, or an increase of £4 3s., compared with 1933-34, and of £36 14s., compared with 1901. With reasonable treatment the secondary industries must steadily develop and the difference between the manufacturing figures, and those of overseas trade must continue to increase mainly because other countries are striving to avoid buying many of the commodities which we export. The development of such a policy is forcing us to discover means to increase local consumption, and owing to increased efficiency in Australia we are now producing goods that previously we imported. The figures I have quoted bear eloquent testimony to the change that is taking place throughout the world to-day. It is absurd to suggest that we should revert to the trade relationships which once existed. Changes must be effected in connexion with those commodities which we sell overseas, and an effort made to increase local consumption of other goods. In view of the policies of economic nationalism adopted by almost every civilized nation throughout the world, unemployment, low standards of living, fear of war with feverish defence activities, and financial crises, it is essential that we should study the national aspect of this subject, keeping in mind the protection and welfare of our people and the solvency of the nation. To do so we must apply to any tariff policy the following tests: -

  1. Its relationship to the financial obligations of Australia overseas.
  2. Its economic contribution to the establishment of industries essential to Australian defence.
  3. Its significance in promoting occupations for the employment of the people, and the relevant standard of living.
  4. Its importance to the revenue of the Commonwealth Government.
  5. Its value to home-consumption as it relates both to primary and secondary industries.

By any one of these tests a protectionist policy in Australia can be justified. It is apparent, however, that after 35 years the Australian tariff is now a combination of all the factors I have mentioned. It is not sufficient to compare the present incidence of the Australian tariff with the tariffs of earlier periods; the comparison should be with tariffs in general and with world economic conditions generally. Duties that protected Australian industries in the predepression years were useless when overseas prices fell to unprecedented levels. A protectionist tariff in, say, 1921, would not now be protective in its incidence, but would in fact be merely a revenue tariff. Unfortunately, there are some who still look upon a really effective tariff as something inimical to our progress and national stability. There are others who, while not holding such extreme views, believe that Australian manufacturers should share the Australian market with overseas manufacturer?. Unfortunately attempts have been made to drive a wedge still further between our primary and secondary industries. The present Minister for Commerce (Dr. Earle Page) speaking on the 23rd August, 1932, is reported in the Argus as having said -

Practically every primary producer is facing bankruptcy because of the failure of the Federal Government to reduce the tariff.

The absurdity of such a statement must be apparent to every one who has read the reports of the various bodies which have investigated the disabilities of primary producers and the economic conditions obtaining in primary industries. The Royal Commission on the Wheat Industry said that -

In general the Australian farmer is to-day paying no more for his machinery than he would have had to pay if the machinery were not made locally and were imported free.

The Royal Commission on the Wheat Industry was appointed, not by a Labour Government, but by the present Government, and the statement which I have just quoted gives the lie direct to the misleading utterances of some members of the Country party, and particularly those made by the Deputy Prime Minister of the present Government (Dr. Earle Page). The report of the commission continued -

Tariff amendments effected since 1932 will effect slight reductions in the cost of some of the farmers’ sundry supplies.

On the 9th September, 1935, an interesting table appeared in the Australian newspapers comparing prices of agricultural implements manufactured in Australia with those ruling in New Zealand and South Africa. Certain members of the Country party are continually saying that the prices charged in Australia are due solely to the Customs duties imposed. The table is as follows : -

It will be seen that the average price of imported agricultural implements in New Zealand is 21.6 per cent. higher than in Australia. Moreover, the Australian manufacturers of agricultural machinery employ 4,000 persons. The Minister for Commerce, speaking at Camboyne on the 16th December, boasted of the fact that the Government had reduced the duties on over 500 items of British manufacture and on 457 of foreign production. It would be interesting to know if the farmers to-day are any better off as the result of such reductions. Have they been saved from bankruptcy? In an endeavour to assist primary producers, the Parliament passed a Loan (Farmers’ Debt Adjustment) Bill lastyear. and to-day an amending measure was considered by this chamber, but that legislation will not be of permanent benefit to them. The members of the Country party, some of whom are now members of the Ministry, cannot point to any substantial increase of the prices of primary products directly attributable to tariff reduction. Owing to low prices a majority of primary producers have been so impoverished financially that they have been unable to purchase the machinery necessary to conduct their farms efficiently. That is borne out by the Royal Commission on the Wheat Industry, which, in its first report, stated that owing to the present disastrous conditions the industry is debarred from spend- ing several millions of pounds annually in the replacement of machinery which has become or is becoming seriously inefficient. The report went on to state that the absence of this expenditure meant the non-employment of many thousands of coal miners, steel workers, agricultural machinery manufacturers, railway employees, salesmen and others, quite apart from the indirect employment which would be given if such persons were at work.

Mr.White. - It is difficult to obtain skilled employees in some trades.


– That is true, but we have to remember that there are still 250,000 persons unemployed.

Mr White:

– There is a shortage of skilled tradesmen in the motor body industry, and also in the building trade generally.


– Yes, there are also 30,000 youths leaving school every year who should be absorbed in industry. Mr. F. W. Hughes, giving evidence before the wool commission in 1932, said -

My inquiries go to show that agricultural machineryis sold in Australia at prices actually lower than in the Argentine, where there is no duty, and my experience is that locally-made agricultural machinery is more durable and better suited for Australian conditions than the imported.

If it is argued that the solution of the difficulties confronting our primary producers is a lower tariff, and decreased cost of production, it would be interesting to know why the primary producers in Great Britain are in such an unsatisfactory position. Can any one explain why thousands of agriculturists in Java and Cuba, living under coolie conditions, are bankrupt? One aspect of this subject which is often overlooked by those who are continually decrying a protective policy, is the protection actually afforded to the primary industries. The assistance now given to those engaged in primary production in Australia would be impossible but for the benefits derived from our protectionist policy, and for the high standard of living enjoyed by the workers. In 1929, Professors Brigden, Copland, and Giblin, and Messrs. Dyason andC. H. Wickens conducted an economic inquiry into the

Australian tariff. These gentlemen recorded the following facts : -

It will, therefore, be seen that £22,000,000 has been expended on behalf of primary producers, as against £26,000,000 in protecting manufacturing industries. In addition to these sums the wheat-growers have been assisted during recent years to the amount of £14,000,000. Last year they received over £4,000,000, and only this week Parliament authorized the appropriation of a further £1,800,000 to assist them. Representatives of primary producers who wish to reduce customs duties, should remember that the finished article of the primary producer is, in many instances, the raw material of the manufacturer. In 1933-34 the value of material used in manufactures amounted to £190,000,000. That expenditure on raw materials benefited not only the primary producers, but also resulted in the employment in manufacturing industries of large numbers who are consumers of primary products. There is no denying that during the recent depression non-industrialized countries suffered more acutely than countries which are fairly well industrialized.

Mr.Gregory. - Does the honorable member include in that statement the United States of America?


– The interjection is typical of the honorable member. He looks at things from the viewpoint of one State, but he should take an Australian viewpoint, and on this question become more reasonable. The honorable gentleman is 100 per cent. protectionist for some articles which are required for the primary producers, but wants freetrade for everything else, although he has already been told that the wheat-growers can purchase farming implements at a 21 per cent. lower cost than the farmers in New Zealand, which is freetrade so far as farming implements are concerned.

There is no doubt that the primary producer of Australia is much better off to-day owing to the fiscal policy of Australia than he would have been- had we depended for our national wealth solely on primary products.

This contention is borne out by the economic committee of inquiry on the Australian tariff in 1929, which in its report stated -

Because of the large proportion of primary production in Australia, Australian income is subject to greater fluctuations than are experienced with its manufacturing production..

Wo should have suffered more from world disturbances had we depended more upon export industries. Before the war, the agricultural and pastoral production also showed progress, but with falls as well as rises. In the years 1908-1913, agricultural production (in million pounds) was 37, 41., 39, 38, 45, 40; and pastoral production 40, 51, 50, 52,63; while manufacturing production was 33, 30, 42, 47, 53, 57.

It isclear from these figures that a larger proportion of manufacturing industry for home-production gives greater stability to the national income, and insofar as the tariff increases the ratio of manufacturing production to total production, it encourages greater stability, and reduces the dependence of Australian industry upon the vagaries of foreign markets.

That was not a Labour committee but one selected and appointed by the BrucePage Government.

The committee went on to say -

We are satisfied that the same average income for the same population would not have been obtained without protection.

Professor Copland in the series of articles in June, 1934, emphasizingthe report of the 1929 committee, made the following remarks -

The tariff has benefits as well as costs. This is true of all kinds of economic policy. The benefits for Australia are found in the establishment and maintenance of certain industries that would otherwise not exist. These industries providemeans of increasing national income and absorbing population in profitable employment.

It is amazing how the Nationalist section of this Government was able to compose its differences with the Country party section so that all could get into one Cabinet, when we consider the conflicting statements of fiscal policy made by the respective leaders.

The Prime Minister, in advising the electors of Indi to vote against the Country party candidate said -

Dr. Earle Page urges that all tariff duties should be taken back to the 1921-28 level, and that Australia should abandon the making of capital goods and centre upon consumption goods. I doubt whether Dr. Earle Page can be really in earnest in this proposal.

Let us look at the fantasy of Dr. Earle Page’s policy.

The immediate effect of it would be to close the two great iron and steel works of Australia. Then all the engineering works such as the great railway workshops at Newport, Victoria, and Newtown, Now South Wales would automatically be put out of business.

Taking the workers and their families, hundreds of thousands would over-night lose their sustenance and cease to become consumers of primary product

When it came to saving the political skins of the members of the Nationalist party and to perpetuating the Nationalist Government, the Prime Minister was prepared to take this man whom he called a dangerous man into his Cabinet and to give him no less an important position than that of Deputy Prime Minister.It is no wonder that a serious blow was dealt to manufacturers who are concerned with the maintenance of the stability of the protectionist policy in Australia. When the Leader of the Country party (Dr. Earle Page) went to the Country party conference at Wagga, and he was giving reasons to his farmer friends as to why he entered the Cabinet, he said -

I have been able to get Mr. Lyons to accept my viewpoint on tariff policy.

The right honorable gentleman who heaped sarcasm and ridicule on the Country party and its tariff policy now boasts of having reduced more than 1,000 items and sub-items of the tariff. The Country party bulletin according to the Melbourne Star of 9th December, 1934, published the following -

It (the Country party) has said courageously that the only way we can maintain our dwindling overseas markets is by tariff reduction.

That is a fallacious idea which for a long time certain interests have engendered. It is opposed to the interests of the farmer and is one that should not be encouraged in Australia.

Mr. Baxter, chairman of the British Milk Marketing Board, who visited New Zealand in connexion with the application of quotas on New Zealand butter and cheese in Great Britain, on his return to England said that the dominion farmer had a strong belief that it was a question of monetary policy or tariffs and a feeling that if the Government of New Zealand would give free entry to

British manufactured goods the quota issue would not have arisen. He said -

I was able to assure them that I had the authority of the Ministry of Agriculture in England to say that the question of tariffs and monetary policy had nothing whatever to do with the quota: if they agreed to remove every tariff against manufactures from this country the question of quotas would remain the same.

Such talk is mere balderdash, and in adopting the same kind of talk the members of the Country party show that they do not know what they are talking about. If they do know what they are talking about, then it is dishonest propaganda calculated to deceive a large section of the primary producers who have no facilities to obtain the latest information.

European countries during the war learned the lesson which has given rise in post-war years to the growth of economic nationalism. Their policy is due to a desire to be self-supporting should another war occur. We have been told that our policy of protection closed the markets of foreign countries against our wheat. The fallacy of that statement is shown by the facts contained in the following table : -

In the World Economic Survey, published by the League of Nations, it is shown that wheat is the most striking illustration, but that meat, butter and cheese and a long list of other important products have also been heavily protected. It is on this congested narrowing world market that the Government is endeavouring to find markets.

It is essential that we should maintain the present overseas markets which we have, but it would not be in the interest of Australia to barter for markets at the expense of our secondary industries. Dealing with this subject, Professor

Copland, who can be accepted as a greater authority than the Minister for Trade and Customs, however eminent he may consider himself, said -

We cannot expect for the moment to win economic salvation by concentrating upon our export trade to the exclusion of other lines of action. Until economic recovery brings greater spending power among our customers, we shall pour our increasing quantities of goods into the narrowing world markets at our own economic peril.

The Minister makes himself appear ludicrous when he endeavours to prove the fallacy of high duties by quoting the employment figures in Australian factories in the year 1931-32 in the depths of the depression as 336,65S, and comparing them with the 450,000 employed in 1934-35, after there had been an allround improvement in world conditions due to to an increase of price levels and the greater spending power enjoyed by freetrade countries as well as protectionist countries.

It cannot be said that the Government of New Zealand stood for high protection or varied its fiscal policy between 1 928-29 and 1931-32. In New Zealand there were 82,861 persons employed in 1929-30, and only 68,921 in 1932-33, which are the latest figures available. Indeed, there hap since been a substantial increase of employment in the factories of that country, the same as in Australia, England, America, Japan and European countries. Obviously, when prices overseas for our exportable products increase, there will be more prosperity in Australia.

Because of greater expenditure by State governments on loan works some thousands of the people who were among the unemployed have been re-absorbed into industry. Had it not been for the whittling away of the protectionist tariff imposed by the Scullin Government, there would have been many more thousands of our people re-engaged in industry because of the greater spending power that that tariff would have given to them. In 1931-32 it did not matter whence the goods came ; the people could not buy them. It is high time that the policy pursued by honorable gentlemen opposite of laying the blame for the depression on the Australian high protection policy ceased.

There are some who consider that the progress being made by Australia is too rapid, and that we are spending too much money in development. They would support a move to restrict credits. It would be very much better to cease reducing tariffs and to restrict imports. A policy of restricted credits to discourage the increase of importations is a retrograde one.

This Government has fallen down on the job. It entered into the iniquitous Ottawa agreement which cut right across the Australian protectionist policy. It waa the greatest political ramp ever perpetrated on behalf of the overseas manufacturers. Clauses 9 to 13 of the Ottawa agreement are most iniquitous. They take the power of increasing duties against imports from Great Britain from this Parliament and place it in the hands of the Tariff Board. Created by Parliament, that board was never intended to be vested with such far-reaching power. Steps should be taken to review the Ottawa agreement at the first opportunity. When a Labour government is again in office, it will take action to have that agreement reviewed, because it believes that agreement to be a blot on the protective policy of Australia.


– I am very glad that at last the Government has brought down a consolidation of the various tariff schedules. The Minister for Trade and Customs (Mr. White), in introducing the tariff, was able to tell a story of the success of the Government’s tariff policy, which cannot be refuted by any arguments from the Opposition. It is clear that Australia at the present time is in a position of which we may be proud. The Government, by its efforts to induce private industry to launch out fearlessly, has gone a long way towards lifting the country out of the depression. When considering our fiscal policy, we must remember that the community is divided into primary and secondary producers, and that the primary producers are responsible almost entirely for the prosperity of the secondary industries. If the primary industries are to be prosperous, it is necessary, unless we are to be a completely self-contained community, to have twoway overseas trade. During the years before the advent of the Lyons Government, such serious restrictions had been placed upon overseas trade that our primary producers were in danger of losing most of their overseas market. Of course, factors other than the Australian tariff helped to bring about this state of affairs, but the position was aggravated by our extreme tariff policy. We know that since the war there has been a tendency throughout the world, and particularly in Europe, to erect high tariff barriers in an attempt by nations to make themselves independent of foreign supplies. A few years ago, Australia, in common with the other parts of the Empire, took part in a conference at Ottawa from which the Ottawa agreement emanated. No one will say that an agreement, after the lapse of some years, may not need revision, and it is generally agreed now that the Ottawa agreement should be revised in some particulars. I say, unhesitatingly, however, that but for its provisions our primary producers, who for the last few years have been very near the bread line, would have been below it. The Ottawa agreement provided that there should be a downward revision of the tariff when that could be done without permitting unfair competition with Australian industries. It was expressly stipulated that local industries should be protected, and so effective has that protection been that there are more persons employed in secondary industries in Australia to-day than ever before.

The Tariff Board has investigated a great many items during the last four years, and has made a great many recommendations. Indeed, so great has been the volume of work done by the board that I sometimes feel that it should have the benefit of further technical assistance. It has, upon occasion, to consider items of an extremely technical character, and it is difficult for laymen to form a proper judgment. For instance, some time ago, the board was called upon to review the duty on watch cases, and eventually recommended a reduction which I do not think was justified. For many years past, watch cases have been manufactured in Australia, and it is a highly specialized and technical industry. The ordinary wrist watch case, such as is worn by, perhaps, half the population of the country, is manufactured in its various varieties to a considerable extent in this country. In the cheaper varieties, such as those covered with chromium and nickel alloys, there is keen competition from other countries. In the course of evidence given before the board, it was stated that in Switzerland - the home of watch making - watch cases could be stamped out of the flat at a cost ranging between 4d. and 8d. each in Australian currency. If one accepted that statement at its face value, one might wonder why the Scullin Government placed a duty as high as 7s. 6d. each on watch cases. The experts are able to advise us, however, that the stamping out of the watch case from the flat is only one of several processes. The case, after being stamped out, has to be polished, and then dipped in the metal with which it is to be plated. It must have a glass fitted, and hooks for the strap, besides a collar for the winding apparatus. The result is that, although the original stamping process may be accomplished at a cost of 8d. or less, the total cost may be in the vicinity of 3s. However, the board was impressed by the arguments advanced by the importing interests, and reduced the duty to 2s. 101/2d. Actually, one of these cases cannot be landed in Australia to-day for less than 4s. 2d. I am sure that expert evidence would have been to the effect that a duty of 2s.101/2d. is not sufficient to protect the Australian industry, and the facts have proved that it is not. It is estimated that over 140,000 of these cheap cases have recently been imported. The actual figures are not available, but that is the estimate arrived at from the value of importations during the six months prior to the 31st December last. I desire to pay the Minister a tribute for the way in which he has interested himself in this matter, but until the duty is altered these cases will continue to pour into the country. Recently, the agent for an English firm was able to book orders from Australian merchants for 21,000 cases. These importations seriously affect the trade of the small manufacturers in this country, with the result that a certain number of skilled die-cutters, improvers, engravers, artisans, watchmakers, leather workers, and metal platers are thrown out of employment.

Mr Rosevear:

– Where are these cases made - in Bendigo?


– There are two factories in Sydney, one in Melbourne, and a small one in Bendigo. The factory in Bendigo is suffering severely as the result of the competition of imported cases.

Mr White:

– The Melbourne factory has recently doubled the number of its employees.


– The Melbourne factory makes the more expensive cases from gold and rolled gold, and with those the imported cases do not compete. In any case, I understand that the Melbourne factory is working short time. The factory in Bendigo is at present manufacturing for stock. The manufacturers ask that further consideration should be given to the matter so that they may be able to keep their trained staffs together. I know that, in the first place, the men employed were foreigners, but they have been training Australians who, in many cases, are now able to do the work themselves. I again appeal to the Minister, either to increase the duty, or to refer the item again to the Tariff Board.


.- The policy of the Labour party is protection, and I support that policy. In my opinion, the time has arrived when this subject should be viewed from a new angle. I regard secondary industries, not as a means of building up huge establishments to enable companies and individuals to make huge profits, but I accept the dictum of the late Mr. Justice Higgins, who, in the Harvester case, said that an industry that could not pay a progressive living wage was of no use to this country.For many years the Commonwealth has paid large bounties to an industry in my electorate of which I should like to be proud, but cannot - I refer to the Australian Iron and Steel Limited. The psychology of its management is such that it believes that its employees should submit to industrial conditions which prevailed in Europe a century ago. The conditions of labour in this industry constitute a menace to the majority of those employed in it.

The workers of Australia have been conceded the right to organize themselves, and to form trade unions ; but an official of a union comprising employees of this company cannot notify the management of decisions reached by the organization without being dismissed. The employees of Broken Hill Proprietary Company Limited, at Newcastle, and of Australian Iron and Steel Limited, at Port Kembla, work in an atmosphere that is artificially heated, and the conditions are almost unbearable. “When I inspected the works I was afraid that my clothing might catch fire. It is urgently necessary that the hours of labour observed in the works at Port Kembla should be reduced, and that the conditions of employment generally should be improved. Men are engaged for twelve hours a day, and overtime; which should be resorted to only in special circumstances, has come to be regarded as normal. If the men decline to work overtime, they are sacked. The very long hours of labour are wearying and cause hardship and dangers which no employees should be expected to endure. If a person compelled a horse or an ox to work for such long hours and under such conditions he would be haled before the courts of the land.

Yet this shocking state of affairs is found in a highly protected industry which has been generously treated in the matter of bounties. It is not concerned now about protective duties, for it says, in effect : “ “We are a huge concern to-day, and well established. Give us cheap labour conditions, and we are prepared to compete against the world “. At the 36-inch mill at Port Kembla the men work under conditions of white heat and become exhausted. Their vigilance soon ceases to be 100 per cent., and accidents of various kinds frequently occur. The works are known in the district and on the railways on the South Coast as “The Butcher’s Shop”, or “ The Slaughter Yards “. In 1934” the Illawarra district ambulance attended 218 major accidents to workers in this industry, and last year there were 220 cases in which major injuries were sustained. Prom the 1st January to the 10th February this year 36 accidents took place, and in 24 instances the services of the ambulance were required. Two of the accidents proved fatal, and many of the other major accidents resulted in serious mutilation of the victims. Most of these unfortunate occurrences are due to the enforced long hours of labour. The management tries persistently to convince the employees that, if they object to their conditions of employment, they will be discharged. It knows only the psychology of the big stick. Much of the work required is unskilled, and the company knows that thousands of men in the locality are in want of employment. Up to the present time, however, owing to the workers’ loyalty to one another, it has not been able to replace all the dismissed men. I am not a protectionist run mad, and if the protectionist policy of this country results only in building up huge monopolies which exploit the workers, I shall have to revise my fiscal views. The conditions of these workers come under the review of a State tribunal, but it has failed to deal satisfactorily with the problem. All that the unionists did was to pass a resolution that, owing to the prevalence of unemployment on the South Coast, and the physical strain imposed on the employees by long hours, no further overtime would be worked. That resolution was sent to the manager through a shop steward, and the only reply he received was : “ You are sacked. Get out of the works “. The manager also used language which I should not be permitted to repeat in this chamber. My statement can be verified by a minister of religion who stood up to his duty and told a Cabinet Minister at a deputation in New South “Wales that that atrocious language had been employed.

I urge this national Parliament to take cognizance of the fact that, at a time when the necessity for shorter hours of employment in industry is recognized throughout the world, this great establishment insists on almost inhuman hours of labour. In the face of grave unemployment, it employs men under conditions that make the utmost toll on human energy. It works its employees twelve and three-quarter hours a day, and sometimes for longer periods. I realize that in any country, whether it3 policy be that of protection or, there will always be business establishments that are prepared to do anything to secure the largest possible returns from the investment of capital, but surely there is a line of demarcation between decency and indecency in industry. I say definitely that those in charge of the works to which I have referred are acting indecently. They have reached the stage at which they regard a workman as a chattel. They show an arrogance born of the success of which they boast. They have their powerful machinery, and they seem to have an idea that they have almost the same power to crush the men in their employment - to pound the men as their machines pound the metal used in the industry. Suchinhuman treatment must breed a spirit of revolt, which cannot be to the advantage of Australia. This Parliament must accept a share of the responsibility for permitting an industry to be carried on in such brutal fashion.

Mr.Gregory. - Did the honorable member say that the Port Kembla works are operating at a profit?


-Of course they are. The Port Kembla works are associated with the Broken Hill Proprietary Company Limited, which, I remind honorable members, spent £50,000 or £60,000 on the production of a book, and distributed the copies in a spirit of arrogance and ostentation to show to the world what a great concern it was. The Broken Hill Proprietary Company Limited also entertained a large number of people for a week at its expense, while at the same time penalizing its employees in a manner that no decent country would tolerate for 24 hours. That is the manner in which Australian Iron and Steel, which to-day is part and parcel of the Broken Hill Proprietary Company Limited., is carrying on its operations, defeating the awards of the country while the court stands idly by. From time to time honorable members have had occasion to refer to revolutionary doctrines and propaganda which are circulating in Australia; the continuance of conditions such as I have explained will certainly bring about revolution. If the courts operate only in the interests of the employing class, and close their doors against the men when they have a just case, consenting to hear them only when they appear to be beaten, the day will very soon arrive when the men will do away with the courts and their injustice. As an illustration of what I have just said, I refer honorable members to the actions of the Prime Minister (Mr. Lyons) recently, when dealing with the seamen’s strike. The late Mr. Justice Higgins, in the Harvester judgment, said in effect, that if an Australian industry was to be of advantage to this nation, it must pay a progressive living wage and provide decent conditions for the workers, and that, unless an industry didso, it was not wanted in Australia. For my part I shall never cast a vote in support of an industry that does not do so. It was on this philosophy, and with this psychology, that the Labour party was founded. I protest on behalf of the 4,000 men of Port Kembla, who will not be granted the dole or relief work by the Government of New South Wales, and who, but for the fact that their comrades are prepared to subscribe to their maintenance, would be faced with starvation. Yet, while the men are enduring hardships, this company, in its arrogance, is permitted to close its doors. It is prepared to wait - twelve or even 24 months - satisfied that it may re-open when it has starved the men into submission, for then it will be able tosubject them to even worse conditions than now exist. That, I fear, will be the continued and conscious policy of industry in this country. The bad employers will eventually influence those who have a more humane outlook, and force them to come into line with them. There are many examples in history to show that the “sweater” will invariably drag his colleagues down to his own level by unfair competition.

Mr Holloway:

– The bad employer always sets the pace.


– Yes, he drags the others down. If this great company is permitted to lead the way in imposing brutal conditions on the workers, that psychology will influence other employers. Having made my protest in Parliament on behalf of the 4,000 men who are affected by the obstinacy of this company I am not prepared to allow the matter to rest there. But I ask this national Parliament, even if it entails an alteration of the entire fiscal structure of

Australia, to set its face against providing bounties and protection to industries which drive their employees in the fashion that I have outlined.

I now desire to refer to statements in connexion with the alleged return of Australia to prosperity, which was announced by the Prime Minister last week and re-hashed by the Minister for Trade and Customs (Mr.White) this afternoon. I refer particularly to the so-called reduction of the number of unemployed from 31 per cent. to 13 per cent. In this regard an old saying which appeared in our school books occurs to me: “Figures cannot lie, but liars can figure.”When statistics such as those quoted by the Prime Minister and the Minister for Trade and Customs are produced, one must always give them careful consideration.

When the effects of the depression were first felt, and men were losing their places in industry very rapidly, they were immediately registered on the tradeunion books as being out of employment. But as time passed many of these men were lost sight of. Trade-union officials will inform honorable members that it has not been possible to keep a precise record of all those men. A considerable percentage of them may never get back into their original employment. In quoting the trade-union figures, the Government, I contend is not within tens of thousands of an exact estimate.

Mr White:

– They are trade-union figures.


– But they are unreliable, as unreliable as any collection of statistics compiled by the Statistician, because they are computed on a wrong basis. Some other method of computing the extent of unemployment in Australia should be adopted. For example, tens of thousands of the youth of Australia have never been inside a trades hall -

Mr Archdale Parkhill:

– Hear, hear !


– That suits the honorable member; “Scabbery” is his psychology. For the last three, four or five years youths leaving school have been unable to find employment, and consequently have not joined trade unions. Not one of them is accounted for in the figures of the Statistician.

My third point is that one-third of the people whom the Government claims have been put back into work are engaged on relief work.

Mr Lane:

– They are not included.


– If they are not included, are we to regard them as lost, like the ten tribes of Israel? The men on relief work are merely working for their “ tucker “, and very poor “ tucker “ at that. I have here a report which states that between 4,000,000 and 5,000,000 people in Great Britain are under-nourished through being forced to live on about 4s. a week. Their physical condition is a menace to the nation. Were an inquiry similar to that undertaken in Britain set on foot in Australia, it would be found that under-nourishment among single men in receipt of 4s. or 5s. a week, and the families of married men who are paid about £11s. a week, exists to an even greater degree. All this talk of a solution of the unemployment problem and of a restoration of prosperity is mere “ eyewash “.

Mr Beasley:

– The only things which have been restored are the bounties.


– There is no general prosperity throughout Australia. It is true that the “ boss “ will provide employment for a few extra hands if the wage is low enough. No worker is refused a job if he is willing to work practically for nothing. As soon as a Labour government went out of office in New South Wales, a few extra jobs became available; but at what rates of pay? Ever since that time, there has been a downward trend. The economic condition of any country and the prosperity of its people have always been measured by the wages fund of the nation. When wages are low, the living conditions of the workers are poor; the lower the wages, the more desperate the conditions. The wages fund in Australia to-day is as low as, and perhaps lower, than when I was a child. Many rural workers, even in those industries which are assisted by bounties, are working for next to nothing. Conditions are not much better than in the days when men were told that they would be paid “ ten bob a week, and eat yourself; five bob a week and the missus will eat you “. When such conditions exist it is always possible to put a few men back to work. But that is not a restoration of employment. The first essential condition for the rehabilitation of industry is a restoration of the purchasing power of the people. There must be a proper home market for the products of both primary and secondary industries. If Australia is to enjoy prosperity there must first be an economic rehabilitation of the nation. Every captain of industry knows that the home market is the best market. It is the best market for the product of both the manufacturer and the primary producer, because it is the market in which he derives his profit. The export trade of every country is more or less a giveaway trade. It is that fact which makes necessary the passing of anti-dumping laws. Unless we are prepared to establish a proper home market and a sound wages fund, increase the purchasing power of the people, all our efforts at rehabilitation will be in vain. I am still a protectionist who believes in adequate protection to Australian industries ; but, if protection is to result in the sort of thing to which I have referred, it would, perhaps, be better that Australia should remain a wheat-field and a sheep walk for ever. It is said that we must encourage our great basic industries in order to ensure our country’s defence. In other words, they must bc developed so that shells to destroy human life can be made. There is no need to wait for a war to destroy human life, because the conditions which obtain in this industry are already destroying human life. The industry stands condemned before the bar of public opinion. I ask this national Parliament to take action to ensure that such conditions shall not continue a day longer.

Sitting suspended from 6.12 to 8 p.m.


.- The concluding remarks of the honorable member for Werriwa (Mr. Lazzarini) reminded me that the tariff may be likened to Frankenstein’s monster - something which one creates and which is serviceable at the beginning but later becomes one’s master. I would like honorable members from Victoria particularly to recall the good times enjoyed in that State in 1880 when a high protection tariff was in operation. Within the fol lowing ten or fifteen years industrial conditions in that State became so intolerable, that articles appeared daily in the Melbourne Age and public meetings were held which were addressed by the lare Mr. Deakin, and the then Mayor of Melbourne, on the subject of the dreadful sweating which existed in the factories of Melbourne - conditions which are somewhat similar to those prescribed in the speech made this afternoon by the honorable member for Werriwa. [Quorum formed.’] While these appalling conditions existed in Victoria, we find that in New South Wales in 1900, as the result of a policy of freetrade, there were acutally more employees engaged in secondary industries than there were in Victoria.

Mr White:

– Most of those were employed in industries associated with timber and tanning. As the honorable member knows there were no factory laws.


– That was not the case. There was a most marked development of high-class manufactured goods in New South Wales. They were much superior to the shoddy class of goods, particularly in clothing, made under sweated conditions in Victoria. Victoria manufacturers were selling their goods in New South Wales at prices considerably below those at which similar goods were being sold to their own poverty-stricken people in Victoria. Furthermore, under freetrade in New South Wales, living was much cheaper and prosperity was much more apparent than in Victoria; indeed, at that time there was dreadful poverty in Melbourne, and the poor were subjected to sweating and slum dwellings. The Deputy Leader of the Opposition (Mr. Forde) drew attention to what he termed the valuable effect of the 1930-32 tariff. He tried to persuade honorable members that it increased employment in Australia - in some industries at any rate. But the contrary is the truth. From 1929 to 1932 the tariff policy of the Scullin Government resulted in the dismissal of just under 114,000 operatives employed in Australian factories. The Labour party in those years went a step further than other governments with protective policies. It placed embargoes on certain goods. Without discussing the legality of such action let us study its effect. Apparently the Labour government assumed that goods would come into Australia when we had no credit balance overseas for the purchase of them. The failure of exporters to provide credits in London to enable manufacturers to purchase raw materials threw great numbers of people out of employment. The honorable member gave credit to the Scullin Government for the imposition of very high duties during its term of office. The Tariff Board Act provides specifically that there shall not be any increase or reduction of tariff duties without such duties being first reported upon by the Tariff Board. When the Scullin Government took office in 1929, it made no attempt to secure any information along these lines, but in a most peculiar fashion, simply brought tariff proposals before this House, sometimes increasing duties by from 200 per cent. to 300 per cent. without having asked for or received any report on such duties from the Tariff Board. In 1928 a. committee of economists was appointed to report on the effects of the Australian tariff. In one of the appendices to its report, that committee estimated the value of tariff protection to manufacturing industries, assuming that the manufacturers took full advantage of such duties, and compared these figures with the total salaries and wages paid within the respective industries. In respect of the manufacture of blankets and flannels, it showed that salaries and wages paid in the industry amounted to £399,000 a year, whilst the value of the tariff protection given to the industry was £468,000 a year. Salaries and wages paid in knitting factories totalled£1,269,000, whilst the value of tariff protection given to the industry amounted to £1.699.000 or £400,000 more than the salaries and wages paid. These conditions operated in 1928 before the Labour Government increased tariff duties, in some instances from 200 to 300 per cent. I can quite understand that many honorable members do not relish facts of this sort, because they show conclusively that it would be reasonable to reduce our tariffs to the level of 1928 and 1929 and that the duties then obtaining should satisfy the manufacturers of this country. This committee also showed that wages and salaries paid in the rubber goods industry amounted to £1,337,000 a year, whilst the value of the tariff protection was £2,178,000 a year. I could quote a list of other industries, showing that in 1928 the value of protection in many industries greatly exceeded the total wages and salaries paid in those industries. Despite the high protection existing in 1928, the Scullin Government increased duties by 100 per cent. and 200 per cent. and, in connexion with clothing, by 300 per cent. Consequently, I expected that when the Lyons Government assumed office, it would reduce the Scullin Government’s tariffs to the 1928 level, at least, until the Tariff Board had reported on the various items. I repeat that the Scullin Government arbitrarily increased duties in spite of the fact that the Tariff Board Act distinctly lays it down that duties shall not be either increased or reduced until the Tariff Board has reported on the items concerned. That act, does not declare that the Minister shall be bound by reports made by the board, but it requires that he shall have such reports before tabling tariff proposals in this House. The Labour Government brought about vast changes of tariff policy without any such inquiries being made. Therefore, I was justified in believing that the Lyons Government would reduce these duties immediately upon taking office, but it appears that the old influences are still at work, and are demanding the right to impose a toll on the producer. The Deputy Leader of the Opposition also compared the prices prevailing in New Zealand and South Africa and other countries for certain goods, in comparison with the prices in this country, pointing out that such goods were cheaper here. In respect of reapers and binders, Ipointoutthatthemachineusedin New Zealand is not similar to that manufactured in Australia. Some years ago H. V. McKay and Company exported reapers and binders to New Zealand, but in the following year they sent only 2 lb. of parts to New Zealand, and nothing at all in subsequent years. It is apparent, therefore, that the machine manufactured in Australia is not suitable to the New Zealand trade. In regard to the selling prices of agricultural machinery in Canada and the United States of America, as compared with prices in Australia, I appeared before the Tariff Hoard when it was inquiring into these items and urged that the board should recommend that agricultural machinery should be sold as cheaply in Australia as in Canada and the United States of America. I pointed out that this industry in Canada had to import up to 1,000,000 tons of coal annually. Here in Australia we have adequate coal deposits adjacent to the centres of manufacture. Furthermore, Canada does not possess great iron deposits, but at Iron Knob we have the richest iron deposits in the world. Again, Canada pays its artisans 8-Jd. an hour more than is paid to artisans in Australia. In view of these facts why should agricultural machinery be dearer in Australia than in Canada?


– The machine is not priced as high in Australia as in New Zealand.


– I have already shown that a different machine is required in New Zealand. A lot of nonsense is talked about agricultural machinery. For instance, before the Tariff Board some witnesses argued that because a machine was heavy, it should be more suitable for agricultural work. Weight is not important in this machinery. I have seen machines which would suit a bullock driver rather than a farmer, but the machine imported from America is of exceptionally light construction. The cash selling prices of the commoner agriculture machines in the United States of America, Canada, and Australia, are as follows: -

I contended before the Tariff Board that that class of machinery should be manufactured as cheaply in Australia, and I know of no reason why it should not be. I had a very high regard for the late Mr. Hugh McKay, who established a most important industry in this country and gave employment to a large number of Australian workmen; but I do not forget that, largely as a result of our policy of high protection for Australian secondary industries, he was able to accumulate a huge fortune from the profits arising from the sale of his agricultural machinery to Australian farmers. I should be only too pleased to lend my support to such industries if the price demanded from Australian users were not too high. My complaint is that our primary producers have been made to suffer far too much in the interests of secondary production. I admit that the manufacturers suffered a severe knock in 1929, 1930 and 1931, but in more recent years they have been able to show very decent profits, whilst the primary producers, who are compelled to pay high prices for their requirements, have found it exceedingly difficult to carry on.

This debate presents an opportunity to consider whether or not the present tariff is really in the interests of the people. I do not suggest that we would be justified in adopting a freetrade policy, in view of existing world conditions, but I am quite sure that, if we do not modify some of the restrictions which have been placed on trade, if we do not give greater encouragement to rural industries to ensure that the empty spaces of this country will be occupied and properly developed within the next fifteen or twenty years, the people of Australia will have reason to regret it. What answer can we make to the teeming populations of other countries for our failure more effectively to occupy this country, which, although it is the equal in size of the United States of America, has a population of only 6,500.000 people?

Mr Garden:

– Would the honorable member put more people on the land?


– Yes ; but we must give them a chance to make a decent living. Figures which I gave to the House a day or two ago, in the debate on another subject, showed that, whilst the cost of developing a rural property in 1913 was £1,000, the cost in 1931, due to high protection, embargoes and restrictions, had risen to £2,260. How on earth can we expect men to carry on under such heavy burdens and expand our export trade, which is so essential to our prosperity? The home market can absorb only a small proportion of our total production, so we must look to the overseas markets for the disposal of the great bulk of our surplus. But so far from encouraging trade, wo have been doing our best to destroy markets, and more and more young people who, in happier circumstances, would give their attention to rural occupations, are drifting to the cities.

Mr Bernard Corser:

– Yet we arc producing more than we can sell in the world’s markets.


– All countries are suffering acutely as a result of the dreadful catastrophe that overtook the world in 1914-16. Many people believe that the disaster in the United States of America was wholly due to high protective policy. That was not the sole reason. There was an enormous free list in that country, but the great manufacturing industries were able to bring pressure to bear upon the administration to erect barriers against the importation of goods which came into competition with them, and in these they had undisputed control of the home market. Prior to the depression, the import and export trade of the United States of America was of enormous dimensions, but when the depression struck the western world, we had the spectacle of manufacturers and primary producers alike trying vainly to find a market for their surplus products. The competition between primary and manufactured goods forced prices to fall, and such was the momentum of this downward movement, that within a remarkably short space of time the people of the United States of America were in the throes of the greatest depression in its history. Unhappily, we have been doing much the same in Australia. Nobody can read the report of the royal commission which inquired into the condition of the wheat industry without realizing that the impoverishment of our primage industries is due largely to the restrictions which have been imposed upon trade with other countries. “When the depression descended upon Australia a few years ago, manufacturers, who, up till that time, had been prospering, were compelled to dismiss employees in wholesale fashion. Not less than 114,000 persons thus lost their employment. This became necessary simply because of the disastrous decline of the export values of our surplus primary products. Many people appear to overlook the fact that by exporting our products, whether wool, wheat, gold or copper, we establish credits in Australia, and the resultant purchasing power in the pockets of the people enables industry to be carried on. But we are too much under the domination of city manufacturing interests. Immediately tariff alterations are contemplated, honorable members are innundated with circulars from interested quarters, and considerable lobbying is carried on during the discussion of tariff schedules.

There is need for greater recognition of the truth that we cannot expect to sell unless we are willing to buy. Gold is not returned for goods sold. The only time within my memory that gold was imported into Australia was in 1925, when the note issue board - it was not then under the control of the Commonwealth Bank - restricted the issue of notes with the result that the Brisbane wool sales had to be suspended and the banks wore forced to import £10,000,000 in gold from the United States of America. If we wish to build up our export trade and thus make our primary industries prosperous, we must be prepared to accept, on reasonable terms, the products of other countries. But instead of doing this we have been doing our best in recent years to antagonize our best customers - France, Germany and Italy - all for the purpose of giving a few more concessions to some companies in Australia. The most discreditable administrative act in recent years was the imposition of the embargo on the importation of Belgian glass with the result that Belgium retaliated by declining to purchase Australian meat or barley. The evil effect of the present high tariff is accentuated by primage duty and sales tax, and there is now the problem of cartels. In this respect the British manufacturer is not free from blame. I gladly acknowledge all that we owe to Great Britain for the market which we have enjoyed for the sale of our primary products, and the protection which the British Navy has afforded to Australia during the last 150 years ; but I do not forget that the British manufacturer is just as anxious for profits as is his German or French competitor, and I am concerned at the recent trend towards the establishment of cartels in the interests of manufacturing interests of different countries. This was brought strikingly to my notice not long ago when I endeavoured to obtain prices of wire-netting from Belgium. In response to my inquiries I received a memorandum from the manufacturers to the effect that while they listed this item, they could not give a quotation because the trade in that commodity had already been apportioned. I also noticed at about the same time or earlier that New Zealand, which was in much the same position as South Africa with regard to wire-netting prices, was suddenly placed upon the same basis as Victoria. I then wrote to South Africa inquiring the price of wire-netting there, and was informed that the price of 8-gauge fencing wire was £12 16s. a long ton, and of barbed wire 12^-gauge, £11 15s. 5d. I think the price in Australia is £24.

Mr Nock:

– That is the price of 14- gauge fencing wire.

Mr White:

– I assume that the honorable member for .Swan is quoting sterling prices in South Africa.


– Yes. The present c.i.f. Capetown price for wire-netting 42 x 1^ x 17 is £22 3s. a mile, subject to a duty of 15 per cent. It is a pity that we shall not have an opportunity to discuss these items. I believe the Minister for Trade and Customs has a personal knowledge of the treatment meted out to a Melbourne manufacturer of barbed wire and wire nails. He was compelled to purchase his raw material from either Lysaght Limited or Rylands, the only drawers of wire. They insisted that he must refrain from selling his goods in New South Wales and Queensland, must fix his price in Tasmania, and must raise his price in Victoria by £6 a ton. I wanted the Tariff Board to deal with the matter as an act in the nature of restraint of trade. The board definitely promised to do so. Some little while later, however, the Minister informed me that it had been withdrawn from the board because the man in question would not proceed with the charge. He would not dare to do so. I know that the Broken Hill Proprietary Company Limited and other concerns have refused to supply reputable firms unless they would join the association and conform to its rules. I have the printed forms of Rylands and Lysaght Limited in connexion with wire and wire-netting, and can assure honorable members that they fix not only the wholesale, but also the retail price, and impose penalties upon any one who dares to sell below the fixed price. Such a practice should not be permitted. This is one of the evils of the cartel and the high-duty system.

It has been argued that no attempt has been made to reduce tariff imposts. I give the Government some credit for what it has done. The report of the Tariff Board shows that there have been enormous reductions, which justify every word of my condemnation of the irresponsible attitude towards the tariff which the Labour party adopted when in power. The duty on earthenware lavatory basins has been reduced from 7s. 3d. to 3s. 3d. each; that on shovels from 12s. Id. to 6s. 8d. a dozen; that on holts and nuts from 12s. 10d. to 3s. 9d. a cwt. ; that on dredging and excavating machinery from £60 10s. to £33 on each £100 value; that on electrical switches from 16s. 6d. to 7s. 7d. for each £1 value; that on men’s suits from £1 8s. 2d. to 18s. 3d. a dozen; that on silk stockings from £1 13s. to 9s. 6d. a dozen; that on children’s cotton socks from £1 0s. 7d. to 2s. 4d. a dozen; that on arsenate of lead from £16 ls. 4d. to £9 4s. a ton; that on mowers from £4 8s. to £1 2s. for each £10 value; that on motor body panels from £33 9s. 3d. to £6 5s. Id. a set, and that on sulphate of ammonia from 19s. 9d. a ton to nil. This list of reductions contains many more items. 1 trust that the Minister will provide opportunity for a debate on agricultural machinery, to see whether it is not possible for Australia to obtain this machinery at the price charged for it in Canada.

Mr.White. - The report of the Tariff Board shows that, in the main, agricultural machinery is cheaper in Australia than in New Zealand, where it is imported.


– If the price were reduced there would be greater competition. I hope that this will he the last occasion upon which approval of a tariff schedule will he delayed beyond the time fixed by Parliament for its ratification. Such delays are decidedly unfair. That was particularly evident in respect of the huge duties imposed by the Scullin Government, which stood for nearly four years before an opportunity to legalize them was afforded to the Senate, which was strongly opposed to them. There is grave objection to any taxation being imposed upon the people without parliamentary approval.

I cannot understand why the Minister for Trade and Customs objects to the tabling of a return giving details of concessions allowed in respect of dutiable goods.

Mr White:

– I offered to show the list to the honorable member, but he has not availed himself of that invitation. It should not be made public.


– The Commonwealth Year-Book shows that goods to the value of £24,000,000 are admitted dutyfree, while imports to the value of £35,000,000 are dutiable. To prevent scandals, all the light possible should be thrown on these transactions. The Minister should publish a return each year, showing the remissions and the reason for them. In 1930-31 I was furnished with a return which showed that £6,000,000 worth of goods had been admitted at concession rates, and on goods to the value of £2,000,000 duty had been remitted. I contend that Parliament has a right to this information.

Mr White:

– I placed 600 by-law items on the tariff. Does the honorable member want to know the name of every mining company in his State which has been given a concession? If he does, I shall supply him with a list; but it will not be published to the world.


– Such a list ought to be laid on the table. There have been cases of a concession being given to one person and denied to others.

Mr White:

– There have been no such cases during my administration.


– The Minister has pointed out that the duty cannot be removed from agricultural implements because very little trade in that line is done by Australia with the United States of America. The honorable gentleman would have acted more wisely had he placed restrictions on the imports of American motor cars rather than on agricultural machinery.

Mr White:

– Would the honorable member raise the duty on American cars?


– No.

Mr White:

– In what other way could the action he suggests be taken?


– In connexion with certain parts, a greater concession could be given to Great Britain or other countries. Great Britain does not manufacture the class of agricultural machinery that we require.

Item 174 contains a long list of machines which generally are free of duty. I notice that last year, under ministerial direction, a large quantity of different classes of machinery was admitted free of duty if imported from Great Britain, and at a duty of 15 per cent. if from foreign countries. I hope the honorable member will make it clear that other machinery not included in Item 174 will be admitted duty-free provided it is not being commercially manufactured in Australia.

Mr White:

– That is the policy of the Government.


.- I listened attentively to the speech of the Minister for Trade and Customs (Mr. White). When he claimed that the Government was entitled to credit for the recovery that had taken place within Australia, he reminded me of one who would take credit for rain which fell after a prolonged drought. The honorable member quoted certain unemployment figures. I point out that in 1927, when the population of Australia was 6,121,757, the number of workers in industry totalled 452,000, whereas in 1935, with a population of 6,700,000, the workers in industry numbered only 459,000. According to the Minister’s own figures, the natural increase in industry should have been 46,000, which is 39,000 greater than the actual increase. Had those 39,000 been placed in employment, an additional £6,000,000 annually would have been paid in wages. According to the Minister, 250,000 persons are unemployed in the Commonwealth. If they were employed to-day the wages bill would be increased by £25,000,000 a year.

Mr White:

– I did not use those figures.


– I admit that they were not used to-day. The honorable member frequently talks about helping the Empire to expand its trade. During the course of his speech this afternoon I interjected that he was more concerned about increasing trade with Japan than with the British Empire. We, on this side, have no objection to the expansion of trade within the Empire, but we do object to assistance being given to cheaplabour countries. I shall show that imports from Japan have increased while those from Great Britain have decreased. We obtained 41.97 of our imports from Great Britain in 1929-30, and 43.35 of them in 1933-34- a very small increase. Three per cent, of our imports came from Japan in 1929-30, and 6 per cent, of them came from that source in 1934-35, an increase of 100 per cent. British imports into Australia were valued at £54,000,000 in 1929-30, and at only £25,000,000 in 1934-35, or a decrease of 50 per cent. Our imports from Japan were valued at £4,000,000 in 1929-30, and at £3,676,000 in 1934-35. It will be seen, therefore, that while heavily decreased trade was done with Great Britain, the trade with Japan remained stable. Yet honorable gentlemen opposite are always saying that we should assist Great Britain by buying Empire goods. Let us look at a few of the items imported from Great Britain and Japan. Our imports of artificial silk goods from Great Britain were valued at £961,000 in 1929-30, and at £715,000 in 1934-35 - a decrease of more than £200,000. Our imports of similar goods from Japan were valued at £13,658 in 1929-30, and at £1,391,000 in 1934-35.

Mr White:

– Would the honorable member support an increase of duties on Japanese goods?


– I certainly would. Our imports of cotton piece goods from

Great Britain were valued at more than £6,000,000 in 1929-30, and at only £3,000,000 in 1934-35- another enormous decrease. To put it in another way, Japan doubled its trade, while the trade of Great Britain was halved. Yet this Government expects us to believe that it is really interested in the welfare of British workers.

Mr White:

– Does the honorable member know that those are the only two textile items in which Japanese trade is on a better footing than British trade?


– I shall deal with some other items which the Minister will find it hard to explain. I am deeply interested in this aspect of our overseas trade because of the circumstances of the electorate which I represent. Our imports of wearing apparel and textiles from Japan were valued at £1,641,178 in 1930-31, and at £2,500,000 in 1934-35. Yet we have in Australia the machinery and plant and the workmen capable of manufacturing these goods. Take such an item as towelling. The Commonwealth Weaving Mills erected large factories to produce towelling for the local market. The Minister on one occasion visited those mills, expressed his pleasure at what was being done, and promised to do everything possible to assist the industry. Yet Japanese towelling now holds command of the local market to the detriment of the Australian industry. Let honorable members consider, for a moment, the position in regard to earthenware. Woolworths, Coles, and certain other big stores, have their shelves filled to the ceiling with cheap Japanese earthenware goods. These trading organizations are not selling Australian products, nor do they wish to do so. They are competing against the genuine storekeeper and selling goods manufactured in countries where coloured labour is employed. Earthenware obtained from Japan was valued at £74,000 in 1930-31, and at £181,000 in 1934-35. Yet members of the Government say time and time again, “ We are not doing anything to hinder any Australian industry.”

Mr White:

– Does the honorable member say that the goods to which he has referred can be made in Australia?


– I do.

Mr White:

– That is not so. The towelling and pottery are of a description not manufactured here.


– I disagree with the Minister. Certain tumblers which can be bought at Woolworths for Id. each contain raw material valued at 3d. Yet Japan, with its depreciated yen, and its cheap labour, can export such articles to Australia at a price which makes local competition impossible. In all these circumstances, it is not surprising that the honorable member for Werriwa (Mr. Lazzarini) should have exposed the ramifications of the bounty and subsidy policy which this Government has adopted. His references to the Australian Iron and Steel Company were enlightening. This organization was at one time insistent in its requests for bounties, but now it says, “ We do not want bounties. We do not want duties or protection. All we want is a low wage rate.” This organization desires to bring our Australian workmen down to the level of the coolie labourers of the Orient.

The Minister claimed great credit for the Government this afternoon because it had taken such a large part in the drafting of the Ottawa agreement, but I can see no reason for giving the Government kudos on that score. Paragragh 12 of that agreement provides that -

No existing duty shall be increased on United Kingdom goods to an amount in excess of the recommendation of the tariff tribunal.

As a matter of fact, the Government has surrendered the responsibilities of this Parliament to a body which is not answerable to the electors. It is not surprising that, in such circumstances, the people generally are dissatisfied. The Government has delegated power to the Tariff Board, the Commonwealth Bank Board, and other boards, in order that when election time comes it will be able to escape the blame for anything that happens in the meantime. It assures us, at one time, that it is opposed to political interference with the operations of boards of one kind and another, and, at another time, that it believes in handing over certain responsibility to these outside organizations. We have boards, here, there, and everywhere, which are not answerable to the people, but which, by their activities, are actually robbing the people of their means of livelihood.

BARKER, SOUTH AUSTRALIA · CP; LP from 1944; LCL from 1951; LP from 1954

– Does the honorable member realize that the Ottawa agreement was ratified by this Parliament?


– I do, and it was done because certain honorable members opposite had not the courage of their convictions. We have had evidence, even lately, of honorable members opposite speaking in one way, and voting in another. They seem to have no conscience.


– The honorable member should know something about that.


– The honorable member for Macquarie (Mr. John Lawson) has been one of the worst offenders lately. I cannot, in this chamber, use the only phrase that occurs to me as properly describing, the conduct of certain honorable members- opposite. The Country party is always seeking help from the Government, but it apparently has little realization of the value of the home market for primary products. If our home market were properly exploited we should not have to worry so much about overseas markets. If the policy of Victoria in the day3 before federation had been persisted in, we should have had 15,000,000 people in Australia to-day, instead of under 7,000,000 people. Certain rabid freetraders, like the honorable member for Swan (Mr. Gregory), seem to have only one song1 - freetrade. I have no doubt that that will be the swan song of the honorable member. He had a good deal to say this evening of what will be the state of this country 40 years hence. If he could have his way, the workers of this country would be reduced to the lowest level of civilization. That would undoubtedly be the effect of the adoption of a policy of freetrade. The home market is the most valuable that the primary producers can have. In 1934-35, Australia produced 164,000,000 bushels of wheat, but exported only 61,000,000 bushels. The remainder was absorbed on the home market.

BARKER, SOUTH AUSTRALIA · CP; LP from 1944; LCL from 1951; LP from 1954

– We did not use half of that quantity, for we had a carry-over of more than 83,000,000 bushels.


– ‘Our production of oats in 1934 was 16,900,000 bushels, of which we exported only 80,000 bushels - a mere handful.

BARKER, SOUTH AUSTRALIA · CP; LP from 1944; LCL from 1951; LP from 1954

– Has the honorable member calculated what population we should need to consume on the home market all the wheat produced in Australia ?


– I am pointing out the value of the home market. We produced, in 1934, 7,000,000 bushels of maize,, of which only 3,000 bushels was exported - not one shipload. Our pro«duction of barley - a cereal in which South Australia is particularly interested -totalled 7,900,000 bushels in 1934, and our exports accounted for only 2,700,000 bushels. We have heard a good deal about the purchase of Australian barley by Belgium, but although we sacrificed half the glass trade of this country to Belgium, because we were informed that the Belgians would buy Australian barley, the fact remains that no Australian barley has gone to that country for a considerable time. We gave away our birthright!

Mr White:

– The Belgians do buy Australian barley in large quantities.


– I can only quote from the latest published figures of the Commonwealth Statistician. For any later information we have to accept the Minister’s figures, and they are not always reliable, as honorable members know. In 1934 the Australian production of hay amounted to 3,582,000 tons, of which only 2,000 tons was exported, the balance being consumed in the home market. If the Minister’s tariff policy were put into operation, that production would not be used at all, because there would be no home market. In the same year the Australian production of wine - and this concerns South Australia mainly- was 13,000,000 gallons, of which only 3,000,000 gallons was exported. The majority of the wine exported went to Great Britain, the only market available.

BARKER, SOUTH AUSTRALIA · CP; LP from 1944; LCL from 1951; LP from 1954

– Would the honorable member advocate an increase of the home consumption of wine?


– No ; I personally do not drink wine, and I am opposed to the whole traffic in intoxicants. Of the 327,000 tons of potatoes grown in Australia in 1934 only 1.900 tons was exported, the balance being sold on the home market. All these figures show that the home market is the one which we should encourage and develop. Of the 900,000,000 lb. of beef produced in Australia in 1934, 733,000,000 lb. or 81 per cent, of the beef slaughtered was consumed in this country, principally by the industrial workers. Yet the Minister for Trade and Customs was emphasizing to-day the large percentage of our exports that is bought by the United Kingdom. We never hear Country party members standing up for the development of the home market for beef; they are interested only in the Australian quota on the British market. Our wool clip is mainly shipped abroad, but of the 995,000,000 lb. produced in Australia in 1934, 785,000,000 lb. was sent overseas, and over 220,000,000 lb. was absorbed on the local market. One of the things that must be considered in relation to this industry is the necessity for developing a market for this commodity in the poorer countries which require it. The wool-growers are robbed all the time. If the Government took full control of the export of wool with a view to the development of overseas markets for that product, which the world so much requires, the wool industry would be of much greater value to Australia. During 1934 Australia produced 450,000,000 lb. of butter, of which 163,000,000 lb. was exported; the balance was consumed by the workers in Australia, where, owing to the operation of the Paterson butter scheme, it brought a higher price. These higher prices went to those people who desired to see the wages of the workers in this country cut down to the low level of 10s. a week. How much butter could the workers buy on those wages? The Country party in this House stands for low wages and long hours; it is looking for markets overseas when the greatest market is in this country. The policy of the party to which I belong is to develop and expand the home market. The problem we have to face is that of developing our own country. The honorable member for Swan (Mr. Gregory), who is continually advocating the reduction of duties must know that the retail prices of goods in respect of which reductions of duty have been made, have been increased and are still increasing. Yet according to the honorable member’s argument they should have been reduced. When the Scullin Government’s tariff was operating in 1930 to 1932, the prices of goods were lower than they are to-day, although the duties on so many items have been reduced. The arguments advanced by the honorable member for Swan, therefore fall to the ground. Why is it that despite the reduction of duties, prices continue at a high level? The honorable member said that the royal commission on the wheat industry - a tribunal which he is always praising - reported that the debt structure of the Australian farmer is over £400,000,000. Poor farmers! But although that same royal commission proved that the farmers are able to buy machines produced by Australian workmen on high wages at a price lower than is paid in New Zealand for imported machines, the honorable member still wants free access to the foreign market. We have no complaint about H. V. McKay and Company. The American firm of McCormack and Company, in order to capture our local market, would be prepared to dump agriculture machinery in Australia at any price. The honorable member and his party are quite prepared to buy goods from abroad so long as they can be obtained for practically nothing. If he could do that, what a wonderful time he would have ! The Labour party stands for the protection of our own Australian industries. I believe in what is called the new protection, the principle of which is that goods which cannot be produced in Australia should not be taxed, but that the door should be shut against the admission of goods which can be produced in this country. That is a problem which must be faced. If we have the men, the means, the machinery and the raw material in Australia for production, why should we go to cheap labour countries like Japan for our requirements? We “believe also in the protection of the workers engaged in industry.

The iron and steel industry in Australia was established with the aid of a special bounty provided by the people. But as soon as it is making a profit and in a flourishing condition, what is the attitude of the manufacturers?

The honorable member for Werriwa (Mr. Lazzarini) dealt with this matter in his very eloquent speech this afternoon. Because the men engaged in that industry refused to work beyond the eight and three-quarter hours provided in the award they were told they could get out. A delegate from the employees approached the manager who asked him what attitude he took. The delegate said that he stood firmly behind the men. The manager told him, in effect, to get out, and that if the men would not work twelve hours a day, they also could get out. Despite this, the courts of this country do not come to the aid of the workers, but on every occasion when it is alleged that the worker is in the wrong, the courts and the Government soon come to the aid of the employers, even to the extent of compelling the worker to take out a licence before he can get employment, and the full machinery at the disposal of the Government is used to brow-beat him. Two of the most eminent Judges of the High Court - Mr. Justice Dixon and Mr. Justice Evatt - said that the laws of this country are always administered to the detriment of the workers. In Australia to-day, we are faced with class courts and class governments. Is it any wonder that the workers are saying that every Judge appointed by an anti-Labour government is put there to do its work? In every instance the Judges are carrying out the desire of the government in power to brow-beat the workers into subjection. Is it any wonder that the workers rebel and say that they will not heed the courts ?

Mr Ward:

– One law for the rich and another for the poor !


– The rich are able to get what they want at any time. Recently, at the invitation of the management, I visited a well-equipped factory which was engaged in the printing of Christmas cards and calendars. I learned that the Government permits the dumping into this country of out-of-date Christmas cards which had been produced for the British market in the preceding season. Those cards were dumped on the Australian market at prices lower than those at which they had been sold on the British market, and no Australian firms could compete against them. I mentioned the matter to the Minister for Trade and Customs (Mr. White), setting out the whole of the particulars in a letter. The dumping of obsolete Christmas cards on the local market has prevented Australian manufacturers from disposing of their product.

Mr White:

– No one would want last year’s cards. To whom could they be sold?


– They were not for any particular year. Cards for which there was no sale in Great Britain were being sold at Id. and even 1/2 d. each.

Mr White:

– There is anti-dumping legislation to prevent that. If the honorable member will supply me with the particulars I shall see if anything can be done in the matter.


– Action should be taken to prevent such unfair competition. On several occasions when I have brought matters of importance under the notice of the Minister I have always been treated courteously, and I have no doubt that if he can he will assist the Australian manufacturers in this instance. When the schedule is under discussion I propose to have something to say concerning some of the duties now operative. I shall do everything in my power to ensure that they are fixed at a rate sufficiently high to protect fully the interests of Australian manufacturers and thereby assist in providing the regular employment of the Australian people.


.- This afternoon we listened to a speech by the Minister for Trade and Customs (Mr. White) which contained many interesting fiscal facts and figures. Whatever views honorable members may hold concerning the protectionist policy of the Government, we must congratulate the Minister upon the convincing and concise manner in which he placed valuable information before the committee. If we are to be guided by most of the speeches delivered, including that of the Minister, we must admit that changes are taking place in our national economy, and that there is an even greater trend towards the adequate protection of Australian industries. The tariff is one of the greatest national problems facing Australia at this period, and it has a most important bearing on the future development of Australia. In approaching a discussion of the tariff, it is, therefore, necessary to emphasize the greatest needs in the Commonwealth to-day - population and national security. Closely allied with the latter is the subject of production, concerning which I shall have something to say later. I support primary industries in endeavouring to develop this essential phase of our national activities. Close co-operation between secondary and primary industries is essential, and the tariff must be such that neither primary nor secondary industries are penalized. I was pleased to notice that the Minister mentioned one important point which was apparently overlooked by the honorable member for Swan, and that is that since the inception of federation adequate protection of Australian industries has been part and parcel of our national policy. Under the influence of. such a policy many secondary industries have been established and developed. In view of the remarks of the honorable member for Swan one should emphasize the fact that our secondary industries were of inestimable benefit to Australia during the depths of the depression period, and that fact must be borne in mind in guarding against possible economic and financial crises in the future. The Minister has already referred to the stability of our secondary industries and to the fact that over 450,000 employees are engaged in secondary production. In addition to this number 150,000 are engaged in allied industries, such as in power plants, &c, so that the total is over 600,000. The value of the goods produced is estimated at £350,000,000 per annum. In connexion with the steady development which has taken place in Australian industries I direct attention to the following figures contained in the last census returns, which indicate that industries have a most important place in our national progress.

[Quorum formed.]

In 1929 there were 43,000 fewer persons permanently employed in rural pursuits than in 1911. Migrants who arrived in Australia, the natural increase of population, and the workers who left rural occupations were all absorbed in or obtained their living in manufacturing, industries, construction or service employment. The importance of our secondary industries is not stressed as it is in connexion with primary industries. It also is interesting to note that over 100,000 extra workers have found employment in secondary industries since 1933, and from 50,000 to 60,000 in constructional and service occupations. These groups are now providing two-thirds of the total employment in the Commonwealth. It will be seen that the development of our secondary industries has been the main means of widening the avenues of commercial and professional employment and in assisting the development of mining, transport and construction. Employment throughout Australia is rapidly reaching the normal pre-depression position, and given an opportunity with reasonable protection our manufacturing industries should within the next year or two be able to absorb the whole of our unemployed as well as those engaged in rural occupations on a sustenance basis. Under a policy of intensive development of our manufacturing industries, a continuance of construction and service occupations, these two desirable objectives can be attained. “We are apt to lose sight of our home market; in fact, the value of the local market is frequently ignored. The figures in connexion with the Australian market which is continually expanding, are as follows -

Australia is anxious to expand its overseas trade, but it must be conceded that this must not be at the expense of a regular and improved home market. It is realized that the effect of the so-called economic nationalism has developed an international policy of artificial barriers muzzling trade. But how is Australia, a comparatively young country with a small population building up valuable secondary industries from an abundance of raw material, to break through these barbed wire entanglements? Although much has been said concerning the removal of international trade barriers nothing has yet been achieved. If other nations such as Germany traded with us on a barter basis an impossible position would arise. Australia cannot trade in that way, particularly with a population of under 7,000,000, which is actually smaller than the population of the City of London. I realize that the difficulty of arranging trade treaties with overseas countries hinges largely upon the position of our secondary industries, and their employment and production. That is most important not only to our primary industries, but also to our secondary industries, because, after all, our home market is the best market for the disposal of our primary products. It is also important to remember that the home market is easily secured, it provides better prices and it is always extending. It is obvious, therefore, that Australia must give exactly the same consideration to this important subject as is given to it by foreign countries in solving similar prob- lems. The 600,000 providing the home market must be kept in employment and their number increased.

In bidding for the overseas market we must focus attention on Great Britain, our principal customer, which at present is showing signs of uneasiness owing to the loss of portions of its trade with Australia. We have read the statements of Britain’s “trade representatives now in Australia concerning low-wage countries. We must also remember that both Britain and Australia will find it difficult to compete successfully with countries in which the cost of production is lower than it is in Australia. We appreciate the difficulties of other nations in their efforts to overcome internal difficulties, and they naturally desire to develop and protect their own national policy. Australia, too, desires to protect its industries, both primary and secondary, in a reasonable way. That has been part and parcel of its policy 6ince federation.

Whatever one’s views may be, one is forced to face up to the fact that the problem before the national Parliament to-day is even more urgent than the mere accomplishment of the objective of an intensive development of our manufacturing industries, desirable and urgent enough in itself. The Commonwealth’s immediate outlook is governed by a twofold consideration which the trend of international events now makes of paramount importance. Summed up, our two most urgent needs are population and national security. The two points are inseparably linked, and any analysis of the position brings one back to that inevitable conclusion.

The stabilized future of our manufacturing industries is a prime requisite if our objectives of increased population and national security are to be achieved. The disastrous results of rural immigration schemes are too fresh in the public mind to need comment. Capital from overseas can be attracted to the Australian manufacturing field, and in the last few days, in Sydney, fresh concrete evidence of the willingness of manufacturers in Great Britain to establish factories in Australia has been brought to light. Any drastic downward revision of the tariff at this juncture can hardly be calculated to encourage this desirable tendency. On the contrary, it would most surely check the very movement for migration of industry which the best minds in Great Britain now realize is the only sort of migration really worth while.

Australia would welcome a scheme based on the establishment of British factories with British capital and British workmen, if, as is proposed, those industries are not at present established in Australia, and would not interfere with existing secondary industries or displace Australians already employed. In considering specific fields of industry which afford opportunities for the investment of British capital and the establishment in Australia of factories by British firms, we may take the classes of goods which are now imported into Australia from Great Britain in large quantities.

In connexion with the foregoing, the following details are extracted from the official import statistics for the twelve months 1934-35: -

It is necessary to stress that the values shown are f.o.b. sterling basis. Expressed in terms of Australian selling prices, the values would be very much higher.

It is necessary further to recognize that the foregoing figures are in relation solely to British goods, and prove no indication of the total consumption of such classes of goods in Australia, for the reason that the import trade is shared between the United Kingdom and foreign countries. It is reasonable to assume that if British manufacturers established factories in Australia, they would secure a very much larger proportion of the total trade.

It is relevant to note that in the report of the British Trade Commissioner in Australia for 1935, page 93, the following statement appears : -

In 1932-33 the United Kingdom secured 33i per cent, of the “ severely competitive “ trade, which latter comprises 45 per cent, of the whole, whilst in 1928-29 the United Kingdom share of the “ severely competitive “ trade was only 29 per cent., and this latter section constituted 50 per cent, of all the competitive trade. These comparisons provide evidence of some improvement during the last few years in the position of the United Kingdom both in the competitive trade generally, and also in that portion in which her share was formerly very unsatisfactory. Nevertheless, there is still room for considerable improvement in these “ severely competitive “ trades. * Quorum formed.’]*

The fact that there still remains a block of import trade worth over £18.000.000 per annum, in which the share of the United Kingdom is little more than one-third, should in itself lie an incentive to greater effort, if only to make up for some of the loss of total trade due to the depression. It may be true that even if it were possible for United Kingdom manufacturers to secure the whole of this block of trade, it would not make up for the total loss which they have suffered in outward trade to Australia in recent years, but if only that proportion were secured which is secured in other “ competitive “ trade, it would make an important difference in United Kingdom producing centres. It must be remembered, too, that the high levels of imports before 1929-30 were abnormal, and are not likely to be reached again for many years, so that there is all the more need to secure as much of the the existing trade as can be gained.

Any proposal from Great Britain to Australia to establish secondary industries non-competitive with local established industries is worthy of favorable consideration by the Commonwealth. It would not effect local employment. On the contrary it would establish a further market for our products, both primary and secondary. [Quorum formed.]

Before resuming from the point at which I was interrupted, I should pointout that there are only two members of the Opposition present. When a subject of such national importance as the tariff is being discussed, the Labour party should be adequately represented in this committee.

Mr James:

– There are no members of the Country party here.


– Australia must have population to hold the country, and this is a sound proposal. The president of the Sydney Chamber of Commerce states that the growth of secondary industries on a. sound basis would develop the home market for primary producers and react favourably for primary producers. It is true, as he adds, that this extra population would create a demand for homes, clothing and other necessary commodities. It would create much greater confidence from the point of view of defence, and would reduce the average tax burden per capita.

Undoubtedly the home consumption of our primary production will increase as time goes on. At the present time the home market consumes 70 per cent, of our primary production if we exempt wool, which, fortunately, can look after itself.

The Sydney Morning Herald, in an editorial on the 16th January, 1936, says -

A tendency to undertake new industrial enterprises was lacking. It will probably be replied that tariff tendencies are partly responsible and greater encouragement could be afforded to the enterprising investor.

The Ottawa agreement also contains restrictive commitments.

We may look rather to the secondary and tertiary industries for expansion. Employment will have to be found in new enterprises”.

It does seem impossible to get back to the old order of things. Overseas countries are striving to do without our exports. We must, indeed, rely on expanding industries for future employment. It is mainly in the manufacturing industries where we are absorbing the unemployed to-day. With the growth of manufacturing we are making for ourselves lines which were previously imported.

It is necessary to point out, however, a danger menacing the development of secondary industries in Australia. Lowwagecountry products are definitely hampering Australian manufacturers, and even goods of Australian origin arc copied abroad and sold back to us from low-wage sources. Analysing the position, it would appear that competition from Great Britain, America and countries with similar wage standards, subject to a reasonable tariff, can he met. Australia must “ take a leaf out of the book “ of other nations and prevent a staggering blow being dealt at her established and sound secondary industries from undue competition. As other nations naturally desire to develop and protect their national policies, so must Australia reasonably protect its industries, primary and secondary. Protection has been part and parcel of Australian policy since the commencement of federation. It is well to point out that Great Britain, the last bulwark of freetrade, has now adopted - has been forced to adopt - protection as its fiscal policy. Manufacturers in Australia to-day are viewing with alarm the competition from low-wage countries.

It is important to stress that our defence in time of war will largely depend on our means of quick communication with other parts of the world with , wireless, aviation, armaments and ammunition and other necessary requirements, and, unless our factories, particularly those in technical industries, are firmly established, and have a home-consumption trade, the essential equipment cannot be produced.

Although one does not wish to interfere with the independence of the Tariff Board, it should be advised that, in the consideration of the tariff, it should keep before it the importance of population and national security. Rightly or wrongly, there is a feeling, too, amongst sections of the secondary industries that the board, at times, gives the foreign manufacturer the benefit of the doubt. If there is any doubt at all, the Australian manufacturer should get the benefit of it. The position is that the board has access to every phase of local production costs, but has not the same facilities with regard to those of overseas manufacturers. Compare our Tariff Board with the Tariff Commission of the United States of America, which, although it works scientifically, and on the theory of independence, bases its decisions on the principle of the equalization of costs of production of any given article at home with that of the principal competing country abroad. In addition, the President has the power to increase existing rates by imposing an additional 50 per cent, ad valorem upon goods coming from countries discriminating against the commerce of the United States of America. This is a country with which our unfavorable trade balance last year amounted to £6,000,000, and in previous years was far greater than that. I am not suggesting we should rigidly follow the example of the United States of America, but the Tariff Board should take into consideration the many difficulties due to local conditions, so that our industries will not be unfairly penalized.

In conclusion, may I emphasize that the future security of Australia demands action on the lines indicated in the course of my speech. We have at our command the necessary raw materials and other resources, as well as the ability to use them. If we analysed the minds of the younger generation of Australians, we should find that they realize that their fathers and elder brothers have beaten the rest of the world in the field of athletics; and the younger generation is still doing it. In the sterner field, when measured in accordance with modern standards, Australians have at least equalled the world’s best in their fighting qualities, and they can secure similar success in the development of industry and commerce.

In that direction lies the path along which will be found the new era which will bring lasting progress to the people of this country.


.- I have listened with a good deal of interest to the speech by the honorable member for Watson (Mr. Jennings), and am wondering what his attitude will be to the reduction of duties that has taken place during the regime of the present Government. The honorable member spoke of the need for adequate protection, and the importance of providing employment for our own people. He also referred to the scope for providing for people from overseas in factories built here with capital from abroad. I take it, however, that he will support the Government in the policy that it has adopted in scaling down the tariff to an extent which those in a position to express considered opinions regard as below the standard necessary to provide adequate protection to our own industries, and to ensure a favorable trade balance. The formation of a coalition Government by the United Australia party and the United Country party has suited those who advocate low duties, for it has drawn into the same school of thought those honorable members who were less anxious to see the tariff lowered. I intend to discuss the tariff on broad lines. There are two basic principles to be kept in mind. We should remember first, that Australia, in order to remain solvent, must have a favorable overseas trade balance annually of £30,000,000, to cover interest and sinking fund payments, and to provide for services abroad. ‘Secondly, the tariff should be used not only to develop but also to preserve our secondary industries. My first proposal seems to be incontrovertible, although there may be a difference of opinion as to what constitutes adequate protection. Mr. S’. M. Bruce, when Resident Minister in London, and addressing the London Chamber of Commerce, said -

For the year ended June, 1930, there was an adverse trade balance of £34,000,000, but, as the result of steps taken by the end of Tunc, 1932, this had been completely wiped out, and Australia had a favorable trade balance of over £30,000,000. It had ruthlessly to cut down imports, and the curtailment effected was from £131,000,000 in 1929-30, to £44,000,000 in 1931-32. This curtailment was effected by prohibitions or embargoes, surcharges and very heavy increases of customs duties. No other course was open to the Commonwealth if it was to meet its external obligations.

Mr. Bruce at least recognized the fact that, despite the mess into which he got this country during the six or seven years when he was Prime Minister - and the mess had to be cleaned up by the Labour Government which succeeded him - this action was necessary to keep the Commonwealth solvent. If he recognized this after the bitter experience of himself and his party at the 1929 election, the present Government and its supporters should take an object lesson from it. Yet the present Government is scaling down the tariff, and last year it had to draw on our credit overseas to the extent of about £25,000,000. In the absence of a rise of prices for our exportable commodities, this presages disaster. The Government says, in effect, that Australia is on an even keel to-day, and that we can continue to reduce duties; but the fact remains that if we are to continue solvent we must have a favorable trade balance of at least £30,000,000. During this week the Prime Minister (Mr. Lyons), in reply to a question which I asked, said that the board of directors of the Commonwealth Bank, and others with whom he was associated, were worried about the present financial position. I asked whether the right honorable gentleman, speaking at a luncheon at the National Club in Sydney on the 5th instant, had said -

He, like many people, and like the bank board itself, had been worried about the trend of Australia’s trade balance, which, after all, was the matter which gave rise to the action of the Commonwealth Bank.

The reply which I received was -

The statement attributed to the Prime Minister is substantially correct. The Government, with the Commonwealth Bank Board, would bc glad to see London funds built up to a higher level, in order to meet eventualities that the future may hold.

The chief way in which our London funds can be increased is by maintaining and expanding our export trade. Another aspect that also shows the trend of the times is the fact that overseas stock exchange investments in Australian enterprises are falling off. The Sydney Morning Herald to-day states that even gold-mining shares display a lagging tendency, and I could cite many instances to show that overseas investors, who generally have their ears to the ground on such matters, are not in a happy frame of mind as to what is happening in Australia to-day. Despite fairly favorable seasons and rising prices for primary products, our London funds have been reduced by £23,000,000. Professor Copland, who is usually conservative in his pronouncements on economic matters, stated in December that he had made a general survey of the position for the current year and estimated, on the basis of three months’ operations, that the export of merchandise and silver for the year could be set down at approximately £96,700,000, while imports would be £79,000,000, leaving a favorable trade balance of £17,700,000. Adding the net export of gold amounting to £7,300,000, there would be a total favorable balance of £25,000,000. That, of course, does not provide for sinking fund for the overseas debt. . Thus Professor Copland expresses disquietitude at the situation abroad. All these things indicate the drift that has been permitted during the last few years, a drift which must finally lead to financial collapse unless the Commonwealth is favoured with good seasons and improved prices for primary products. There is no doubt the trend of events which led to the collapse of 1929-30 is again in the air. I feel bound, therefore, to express grave concern at the action of the Government in reducing the tariff.

The second point that I desire to make is for the preservation and development of Australian secondary industries. In this regard I was interested when the honorable member forWatson pointed out certain things in connexion with our secondary industries. Supporters of the Government, particularly members of the Country party, are always crying “ The sheep carries Australia on its back “ ; “ The wheat-farmer has to bear all of Australia’s burdens “ ; and many similar slogans to tickle the ears of the groundlings. The fact remains, however, that the value of the output of manufactures in the Commonwealth during the last five years was £1,688,000,000, while the value of the primary products including all crops, wool and dairying, amounted to £1,008,000,000, or £680,000,000 less than the output of secondary industries. These illuminating figures demonstrate that Australia does not live by its exports. They also clearly indicate the value of secondary industries to Australia. In the same period of five years, exports totalled £570.000,000, but the value of Australian materials used in Australian factories was about £958,000,000 or £388,000,000 more. The following table shows the actual progress from 1900 to 1932-33-

Any person who has read the history of the development and growth of Great Britain, knows that since the industrial revolution in that country its secondary industries have grown apace with its primary industries. As Australia is a young country, largely undeveloped and requiring population, it must foster its secondary industries and create a home market which, after all, is the best market. By this means Australia will attract the right class of immigrant. In my opinion, Australia must adopt such a policy if it is to take its place among the nations of the world. In these days of economic nationalism I .believe that we must pay increasing attention to the development of the Commonwealth, and I suggest that this expansion can only be achieved by the fostering of our secondary industries. It is futile to pay excessive heed to the matter of finding markets abroad. Of course, Australia requires certain overseas markets for its surplus primary production, but I contend that the secondary industries should not be allowed to languish at the expense of the primary industries. The people who are employed in the secondary industries provide a market at our very door which, after all, is the best market for the development of this country. In addition, I remind honorable members that we have a duty to the youth of Australia. Avenues of employment must be found for our young people. Instead of having thousands of children leaving school each year with no prospect of obtaining employment, this country must bo developed to a stage when it will be capable not only of absorbing its youths in useful occupations, but also of attracting settlers from abroad. It is in the interests of Australia that our raw materials should be manufactured into the finished article in the Commonwealth rather than be shipped overseas to be made up by other workers. In dealing with the tariff honorable members should exercise considerable caution. Otherwise Australia will find itself in an unfortunate position before many years have passed.


– The speeches delivered to-day on this subject have been very interesting, and that of the Minister for Trade and Customs (Mr. White), who introduced the tariff schedule, was a very skilful one - skilful because he contrived to show, by the presentation of masses of statistics, that it was possible for a government to function, temporarily at any rate, in spite of the fact that within its ranks there are protectionists, freetraders and shandy-gaff tariff supporters. The low-tariff exponents from

Western Australia have temporarily adjusted their views on tariff policy for the sake of remaining in office with a government which can be relied upon to grant bounties to that section of the community which they represent, the understanding apparently being that the Government’s direct supporters shall modify their fiscal faith so that the combination may have sufficient numbers to carry on. The speech of the Deputy Leader of the Opposition (Mr. Forde) represented a skilful exposition of the policy of the Labour party for giving proper protection to those engaged in both primary and secondary industries, for developing new industries, and for providing a good home market by ensuring that there shall always exist a well-paid body of workers enjoying a satisfactory standard of living, whose high purchasing power will enable them to absorb the products of the land. The Government evidently believes that, if it can satisfy those in possession - those who directly or indirectly control the avenues of publicity or propaganda in .this country - there is no need to pay much attention to the desires and needs of those who possess little or nothing, perhaps not even a job. In view of the complete statement made on behalf of the Opposition by my Deputy Leader, there is no need for me to do other than refer to a few features which I feel require further criticism.

The Ottawa agreement has done Australia a great deal of harm, and the sooner it is abolished the better. Articles 9, 10, 11 and 12 of the agreement are deliberately designed to prevent the effective functioning of industry in Australia. Those in authority in Australia seem to be more concerned about preserving British trade than with the welfare of Australian industry. Had the Scullin tariff been allowed to remain in force the secondary industries of this country would have developed to such an extent as to be able by now to absorb practically all the unemployed youths in the country. At the present time, there is no satisfactory way of absorbing them into industry, and the seriousness of that situation is realized by any one who lives in a manufacturing electorate such as mine. I find that, even though the Government and its supporters may quote statistics to show that more persons are employed in secondary industries to-day than ever before, there are more than 250,000 persons who cannot obtain employment at all, including a great many young men who have never had jobs. If the country were really in that prosperous condition of which we have heard so much from honorable members opposite, it should be possible to absorb, if not all, at least a great many more of those who are now out of work. Practically half of those who leave school each year have no chance of finding employment. When the British Economic Mission visited Australia, it laid down a policy which was supported by other financial missions from Great Britain, and which the present Government is doing its best to implement. That policy in effect, implies the starving of Australian secondary industries for the benefit of British manufacturers. The Ottawa agreement has resulted in the giving of undue preference to British industry. The Tariff Board is authorized to inquire into the relative costs of manufacture in Groat Britain and in Australia, but the method of ascertaining those costs is, I submit, very one-sided. The board can, of course, make full investigation of Australian costs of production, but I doubt whether the same comprehensive information can be obtained from the British manufacturers, most of whom are represented in this country only by agents. The principals of the firms cannot be brought before the board and examined. I do not suggest that manufacturers as a body in the United Kingdom try deliberately to deceive the board, but the circumstances are such that the board i3, in many instances, not able to get full and accurate information. Article 10 of the Ottawa agreement contains the following provision : -

His Majesty’s Government in the Commonwealth of Australia undertake that, during the currency of this agreement, the tariff shall lie based on the principle that protective duties shall not exceed such a level as will give United Kingdom producers full opportunity of reasonable competition on the basis of the relative cost of economical amd efficient production, provided that in the application of such principle special consideration may be given to the case of industries not fully established.

How can the relative cost of production be ascertained when the data regarding

English firms is not available before the board to work on?

Mr White:

– The Customs Department has access to the invoices, &c, showing the landed cost of the good3, and other particulars in respect of prices.


I am still not satisfied with the Minister’s answer, because there is nothing to show that the actual manufacturing costs are available to the Tariff Board. If that be the position we are placed at a great disadvantage. During the last four or five years we have been fortunate in having had good seasons, a condition of affairs which we cannot expect to continue always. The present tariff arrangements do not make any provision for conditions which may arise from a drought. In the event of the wool industry being seriously affected by drought, Australia might be unable to meet its oversea commitments. It is imperative that our secondary industries shall be encouraged, for to them we must look for employment for our young people. The Scullin Government realized the value of the home market, but the present Government, by a process of attrition, has gradually reduced the duty on a great number of items. Not only should we make every effort to keep existing secondary industries intact, but we should also encourage the establishment of new industries so that avenues of employment will be opened for both skilled and unskilled workers. The last war proved that nations must be prepared to manufacture their own requirements.

Mr White:

– New industries are being established, some of which are in the honorable member’s own electorate.


– I am aware of one or two, but more new industries could well be started. Many of the young people of the community are in deadly earnest in their search for work. Some of them, whom I have recommended for employment, take advantage of every possible opportunity to secure a job, but without success.

Mr White:

– Unskilled youths who have left school for some time find it difficult to secure employment.


– Unfortunately many parents are unable to give their children the training which would fit them for skilled employment. Not every youth can get his training by means of scholarships. Consequently there will always be a number of unskilled workers in our midst who cannot be absorbed in industries requiring skill. In our munitions establishments the work is largely of a skilled nature, and boys who seek employment in them are told that they may have a chance if they undergo training in, say, the Footscray or Brunswick technical colleges. I admit that there has been an expansion of that arm of defence, and that in my electorate there are possibly greater avenues for employment for skilled metal workers than in many other districts. Nevertheless, it is a fact that we are not overcoming the problem of unemployment. The tariff policy of the Government, which we are now asked to accept, is detrimental to the interests of the people as a whole, but I realize that the Government has the numbers and that it is practically useless for honorable members on this side of the chamber to attempt to alter in any substantial way the schedule placed before us. The Government supporters in this Parliament constitute a motley crew of freetraders, protectionists and fiscal nondescripts. I am sure that among honorable members opposite there are many who believe that a higher protective policy than that of the presentGovernment would be beneficial to Australia, but because of the party system they are forced to remain silent in order to placate the Country party section of the Government.

Mr Jennings:

– The tariff is a nonparty question.


– The man who does not recognize that certain sections of the community participate in a form of protection granted to them by means of bounties, while advocating freetrade methods or reduced tariffs for the secondary industries, would be lacking in intelligence. While I cast no reflection on honorable members opposite, I am justified in saying that the Government benches are occupied by a motley crew.

Mr Lane:

– I rise to a point of order. The honorable member’s remark is offensive to me, andI ask that it be withdrawn.


– I withdraw the word “ motley “ and substitute the word “ piebald “. I keenly desire to encourage Australian secondary industries as well as the primary industries. We, on this side, have no conflict with the advocates of the claims of the primary producers, but if we grant them assistance they should not refuse to assist in the development of secondary industries. We should be lacking in a sense of duty if we failed to do our utmost to maintain the measure of protection afforded by the Scullin Government’s tariff under which a body of skilled workers was being built up. I regret that the Government is not prepared to listen to the arguments advanced by the Deputy Leader of the Opposition (Mr. Forde), who made out an excellent case against this tariff schedule. I trust, however, that an opportunity will be given to all honorable members to make representations in regard to specific items, and that their representations will be given consideration. If that be done, we may be able to remedy, to some extent at least, the present unsatisfactory state of affairs in certain industries. Under existing conditions, manufacturers are afraid to establish new industries because of the uncertainty that exists in regard to the tariff. They fear that under the Ottawa agreement the scrutiny of their undertakings by the Tariff Board may result in their businesses being adversely affected if not destroyed. No encouragement is given to those who would establish new industries. I hope, therefore, that the Government will be prepared to listen to arguments in favour of an alteration of the duties on certain items so that existing industries may be developed, new industries established, and Australia made as self-contained as possible. In giving preference to British and dominion products, the Government should not fail to realize that its first duty is to establish and maintain such Australian industries as are essential to the future progress of this country.

The general debate being concluded,

Division I. - Ale, Spirits and Beverages

Items 6 to 11 agreed to.

Progress reported.

page 407


War Pensions - Invalid and Old-Age Pensions

Motion (by Mr. Archdale Parkhill) proposed -

That the House do now adjourn.

East Sydney

.- I desire to bring several matters under the notice of the Minister for Repatriation (Mr. Hughes). Some time ago I made representations in this chamber in regard to ex-soldiers who have to travel from country districts to capital cities for medical treatment. I understand that when these men are furnished with a certificate from the local doctor ordering them to go to Sydney, for instance, the department, except in special cases, will allow them only second-class rail fares. I claim that these men are entitled to first-class and sleeping accommodation, because many of them are very sick men when they have to undertake such journeys. Under present conditions they are forced to sit up all night in a second-class compartment, and should they arrive at any of the capital cities at a time when they cannot go immediately to the hospital or report to the department, they are caused further inconvenience and expense.

I also bring under the notice of the Minister complaints by ex-soldiers who have made claims for -war pensions. When the Pensions Tribunal hears an applicant’s appeal against the decision of the Repatriation Commission, it has at its disposal a file on which appears what is known as a crime sheet, dealing with the personal history of the applicant after enlistment. The result is that many of these applications are determined not upon the medical history of the applicant, but according to whether or not ho is considered by the department, according to his crime sheet, to have been a good soldier. If the Defence Department wishes to retain these crime sheets, it should remove them from the files of the Repatriation Department, so that the information contained therein will not be used against the ex-soldier when he is applying for a pension. Many applicants are of the opinion that their applications for pensions have been turned down, not because they were unable to prove that their injuries were due to war service, but because these alleged crime sheets appearing on their files were considered by the department and the tribunal to reveal that they had not been good soldiers.

Recently, I brought under the notice of the department the case of a widow of an ex-soldier who, on the death of her husband, was unable to pay his burial expenses. Her application for assistance from the department was rejected, the reply being -

Although Mr.- enlisted to active ser vice in the Australian Imperial Forces, he was discharged prior to embarkation and to the period of the armistice, and in such cases no benefits may be conferred under the Australian Soldiers Repatriation Act unless it is shown that some material prejudice, which term shall include physical disability, was suffered by virtue of the period of enlistment.

It has been established upon investigation that no material prejudice was suffered whilst serving in camp, and, consequently, for this reason assistance as desired cannot be allowed.

I might further add that the ex-soldier was not entitled to medical treatment or pension benefits for pulmonary tubercular condition, which caused his death.

I stress the point that if a man had enlisted for active service, whether or not he actually embarked for overseas or suffered disabilities while in camp, the mere fact that he enlisted should place him in the category of those whose dependants are assisted, if they are in such poor circumstances that they are unable to pay his funeral expenses. If the act precludes this, the Government should at the earliest opportunity amend it.

Another case which I bring under the notice of the Minister is that of the wife of an ex-soldier who was receiving a military pension, but who deserted her twenty years ago, and has not since been heard of. This woman has a son who is now almost of adult age, and is unfortunately a mental case. She is unable to maintain her son, and her application for assistance to the department has been rejected. I submit that the department should take a more sympathetic view of such cases, and should not resort to technicalities to deprive an unfortunate woman of a pension on the ground that the ex-soldier had not presented himself for medical examination, and, therefore, could not be proved to be still suffering from war disabilities. I suggest that in such cases some liberality should be shown to the dependants; pensions previously received should be restored, and in future cases the pensions should be continued.

The other matter which I desire to touch upon relates to the administration of the old-age and invalid pensions. Not so long ago, speaking in this chamber, the Treasurer said that if a pensioner possessed a vacant block of land the value of which had been taken into account when assessing his pension, the pensioner could hand this land over to the department, provided it was free of encumbrances, and the department would accept it. I have in mind a pensioner who possesses a block of land valued at £110 on which rates and taxes owing amount to less than £10. This pensioner offered to hand over the land, ‘but the department refused to accept it. The pension being his sole income, he ha3 no chance of paying off the amount owing lor rates and taxes.

Mr Casey:

– Is the laud saleable?


– The pensioner has informed me that he has been unable to dispose of it, although it is valued at £110, and there is less than £10 owing upon it.

Mr Casey:

– If he can get an accredited land valuer to make a valuation I shall see that the department considers it for pension purposes.


– The land in question is many miles from the place where the pensioner lives, and it is not easy for him to obtain a fresh valuation. He has offered to surrender it to the department in order to obtain an increased pension, which is more important to him than the ownership of a vacant block of land. If, in such circumstances, a pensioner is prepared to sacrifice his property, the department should either accept it or grant the applicant a full pension. Another case to which I direct attention relates to the income of parents of invalid pensioners or applicants. I have brought under the notice of the department the case of an invalid pensioner living with his parents. The father is a wharf labourer but as he is a casual worker, his earnings are small. Over a period of twelve months his income would not exceed £3 a week, so he is not in a position to adequately maintain his child, who requires special food and medical attention. Notwithstanding his known circum stances, the department considers that a pension of 18s. 6d. a fortnight is sufficient.

The last matter which I bring to the notice of the Treasurer is the position of a husband over 70 years of age, and his wife, who have been living apart for over 40 years. They have not communicated with each other during the whole of that time, and, as a matter of fact, the husband has no knowledge of hia wife’s whereabouts. ‘They separated by mutual consent. Because they had not been divorced or separated by an order of the court, the department, having located the wife, has assessed her small income against the claim of her husband for a pension. After a separation of over 40 years, he is not disposed to approach his wife with a request to sign a document which would be recognized by the department as a separation agreement, thus enabling him to obtain the maximum pension. I addressed a number of communications to the department with reference to this case, and finally I received a reply to the effect that the department was not empowered to do other than assess the income of the wife against the husband’s claim, because they had not been legally separated. I am aware that provision was inserted in the act to prevent married couples from separating in order that one or both might qualify for the full pension, but I think that, where a husband and wife have been separated for a long period, and obviously did not separate for the purpose of evading some provisions in the act, they should be regarded as separate entities, and be entitled to the full amount of pension. The amount which this old gentleman is now receiving is quite inadequate for his needs. The Deputy Commissioner has assured me that he has no authority to do more for the pensioner. I hope that the Treasurer will see if he can straighten out this matter, and perhaps make arrangements for the payment of the maximum pension to persons who have been separated for a reasonable period, say. three or four years, regardless of whether it is by legal process or mutual agreement.

Minister for Defence · Warringah · UAP

– I shall refer to the Repatriation Depart- meat the several matters which the honorable member for East Sydney (Mr. Ward) has brought under my notice. The Treasurer (Mr. Casey) has asked me to say that, insofar as they affect his department, they will receive consideration.

Question resolved in the affirmative.

House adjourned at 10.47 p.m.

page 409


The following answers to questions were circulated : -

Public Service: Positionsfor Lighthousekeepers’ children

Mr Holloway:

y asked the Prime Minister, upon notice -

Will he consider the practicability and the justice of giving to the children of lighthousekeepers and their assistants the same opportunities as all other children not so isolated, to enter and be examined for all the positions in our Public Service which are filled by competitive examinations?

Mr Lyons:

– I am advised by the Public Service Board that some time back this matter received its particular attention, and arrangements were made for lighthouse staffs to be specially notified of examinations for entrance into the Public Service. No complaint has been received by the board as to the inadequacy of these arrangements, but it will immediately review the matter to ensure that they are being effectively applied.

Federal Capital Territory : Money Lending

Mr James:

s asked the Minister for the Interior, upon notice -

  1. Is there an ordinance for the Federal Capital Territory designed to safeguard against and to penalize usury?
  2. If not, will he inquire into reports that as much as180 per cent. interest has been extorted by a Canberra money lender, and into the question generally of interest rates, with a view to enacting an ordinance?
Mr Paterson:

– An ordinance relating to the business of money lending has been drafted and it is expected that it will become law very shortly.

Publication of Newspaper in Foreign Language.

Mr Holloway:

y asked the Minister representing the Minister for External Affairs, upon notice -

Will he inform the House whether it is a fact that the Jugo-Slav community in Aus tralia have been refused permission to publish a newspaper in their own language; if so, will he inform the House of the reason for this restriction upon the freedom of the press?

Mr Casey:

– Permission to publish a newspaper in the Croatian language has been refused by the Common wealth Government after full consideration of all the circumstances in connexion with the application.

Telephonists : Night Duty

Mr Holloway:

y asked the Minister representing the Postmaster-General, upon notice -

Will he call for a report in connexion with the charge that the Victorian branch of the department is understaffed, with the result that females have been ordered to work all night, thus doing night shifts previously worked exclusively by males?

Mr Archdale Parkhill:

– There is no understating in the Victorian branch of the department and females have not been ordered to work all night. The department has been in consultation with the Commonwealth Telephone Officers Association in regard to certain readjustments of duties, hut no decision has yet been reached.

Marketing Legislation : Privy Council Appeal

Mr Gregory:

y asked the Minister representing the Acting Attorney-General, upon notice -

  1. In connexion with the “James” appeal to the Privy Council regarding the constitutional powers of the Commonwealth, is it a fact that the Government of Western Australia has briefed counsel in support of that appeal ?
  2. Should the appeal prove successful, will it nullify the Commonwealth and State legislation in regard to the control of sales of dried fruits and butter, and render abortive similar legislation for the establishment of a homeconsumption price for wheat?
Mr Hughes:
Minister for Repatriation · NORTH SYDNEY, NEW SOUTH WALES · UAP

– The answers to the honorable member’s questions are as follows : -

  1. Western Australia was granted leave to intervene in this case. As to whether that State will he represented by counsel on the hearing of the appeal, I do not know, but, presumably it will be. I have no information as to the attitude the State will take up on the appeal.
  2. Until the judgment is given and its effect studied, it is impossible to state what the effect of the judgment will be.
Mr Lyons:

s. - Yesterday the honorable member for Eiverina (Mr. Nock) asked a similar question, and it is covered by the reply furnished to the honorable member for Swan.


Mr Mahoney:

asked the Treasurer, upon notice -

  1. Has he any information to supply regarding the press statement that the chairman of the Commonwealth Bank Board, Sir Claude Reading, viewed so seriously the failure of the recent treasury-bill issue that he did not join the s.s. Orion at Melbourne as intended, but is travelling by trainto connect with it at Adelaide, in order to allow further time to consider the position? 2.As it is announced that the purpose of Sir Claude Reading’s visitto England is to deal with matters affecting the Commonwealth Bank, will the Treasurer advise whether the cost of this trip or any portion thereof is being paid by the Commonwealth Government orthe Commonwealth Bank; if so, how much?
Mr Casey:

y. - The answers to the honorable member’s questions are as follows : - 1.I would refer the honorable member to the announcement issued by the Commonwealth Bank Board and published into-day’s papers.

  1. I. am advised that Sir Claude Reading is visiting England on matters affecting the Commonwealth Bank and that the cost of the visit will be borne by the Commonwealth Bank. Information as to the cost involved is not available.

Purchase of Aeroplanes

Mr Arciidale Parkhill:
Minister for Defence · WARRINGAH, NEW SOUTH WALES · UAP

l. - On the 18th March the honorable member for Capricornia (Mr. Forde) asked the following questions, upon notice -

  1. How many aeroplanes for defence purposes have been ordered from Great Britain, and : it what cost?
  2. Is there any delay in the delivery of same; if so, for what reason?
  3. When is delivery anticipated?

I am now in a position to inform the honorable member as follows : -

  1. Since the commencement of the three-year developmental plan, aircraft to the approximate value of £1,070,000 has been ordered from Great Britain for the Royal Australian Air Force. It is not proposed, for obvious reasons, to disclose for general information the numbers of machines ordered, or probable dates of delivery.
  2. There has been delay in receiving delivery of the above aircraft mainly owing to the great demand on the aircraft industry in Great Britain occasioned by the expansion of the Royal Air Force.
  3. See answer to 1.

Cite as: Australia, House of Representatives, Debates, 19 March 1936, viewed 22 October 2017, <>.