14th Parliament · 1st Session
Mr. Speaker (Hon. G. J. Bell) took the chair at 3 p.m., and read prayers.
– I desire to inform honorable members that printed copies of evidence given before the Royal Commission on the Monetary and Banking Systems, covering the period from the 15th January to the 13th February, 1936, inclusive, have been placed in the Library. Further instalments of the evidence will be made available as they are received from the Government Printer.
– Can the Minister representing the Minister for External Affairs furnish the House with any particulars of the proposal contained in the British White Paper for the policing of a neutral zone along the Franco-German boundary with troops supplied by the other Locarno powers, notably Great Britain, Belgium and Italy? Has it been suggested that sanctions should be applied to the Italian troops in the neutral zone, or only to the wives and families who would be left in Italy?
– No information is available to the Government other than what has appeared in the press, and is contained in the detailed proposals of the Locarno signatories laid on the table of the Library last Friday.
Motion (by Mr. Lyons) - by leave - agreed to -
Thatleave of absencefor two months be given to the Minister forCommerce(Dr. Earle Page) and the Attorney-General (Mr. Menzies), on the ground of urgent public business,and to the honorable member for Bendigo(Mr. E. F. Harrison ) , on the ground of urgent privateand public business.
Motion (by Mr. Curtin) - by leave - agreed to -
That leave of absence for two months be given to the honorable member for Kalgoorlie (Mr. A. Green) on the ground of urgent private business.
– During the debate on cement duties last Friday, the Minister for Trade and Customs made an assertion, which he repeated publicly during the week-end, to the effect that the amendment of the honorable member for Moreton (Mr. Francis), for the postponement of th is item, with a view to an alteration of the proposal of the Government, would, if given effect, transgress the provisions of the Ottawa agreement. Was this view based upon the considered opinion of an independent authority who is not a politician? If so, who is the authority?If not, will the Minister undertake to obtain such an opinion, and make it available verbatim to honorable members before the subject of cement duties is again discussed either in the Senate or in this chamber?
– I expressed the opinion of the Government. If the honorable member will place his question on the notice-paper, I shall reply fully to it.
– Has the Minister for Health read in to-day’s Sydney Daily Telegraph the report that Dr. Warneford Moppett, of the Cancer Research Bureau of theSydney University, has formulated relatively simple tests which will prove the presence of cancer cells in human blood or their absence from it? In view of the importance of combating the cancer scourge, will the right honorable gentleman ask the Director-General of Health to advise upon Dr. Moppett’s reported discovery ?
– My attention has not been drawn to this matter, but I shall get into touch with the Director-General of Public Health and ascertain his views upon it.
– Last week the Minister representing the Minister for External Affairs undertook to furnish any information received by the Government concerning the reported conflict between Russian and Japanese troops? Has the honorable gentleman any information to impart as to the extent of that conflict and the likelihood of its spreading?
– The Government has not received any official information in regard to the matter.
Melbourne “ Age “ Articles
– Has the attention of the Minister for Defence been drawn to a series of articles published in the Melbourne Age on the subject of Australian defence? Is it a fact, as these articles imply, that the opinions which they express are those of the higher command ?
– The members of the Military Board and I have read these articles. They are sound in some respects, particularly in those portions which endorse the policy of the Government. Other portions, it is considered, are based on unsound premises. There is no justification for the implication that they have the support of officers of the Defence Department and of what the newspaper describes as the “ Higher Command “. They do a very grave injustice to an honorable body of men, who do not express opinions except to their ministerial head, and in other recognized ways. The officers of the Victorian branch of the Defence Department have, of their own volition, signed a document stating that none of the information published in these articles has been referred to them.’and that they have not expressed any opinion in regard to it to the Age proprietary.
– Will the Minister for Defence explain to the House what he means by the term “ Higher Command “ ? Are the members of that command, in his opinion, restricted to the Permanent Forces?
– I was merely quoting the term used by the newspaper to which reference has been made.I assume that it would refer to officers of the Permanent Forces.
-Will the Prime Minister inform me whether any instructions have been given to the honorable member for Bendigo (Mr. E. F. Harrison) as to the attitude he shall adopt at the Internationa] Labour Conference, at which, I believe, the subject of a 40-hours working week will be discussed in its application to specific industries?
– So far, no definite instructions have been given to the honorable member.
– In view of the many applications from the States to the Commonwealth for financial assistance out of Commonwealth revenue, will the Treasurer consider the advisability of calling & conference of State Treasurers for the purpose of considering a scheme by which the States may enter certain fields of taxation now occupied solely by the Commonwealth in order that the necessary revenue may he raised by the States.
– A. tentative arrangement has been made for a meeting between Commonwealth and State Ministers in September next, when two State Premiers, who are now absent from Australia, will have returned. That meeting, I expect, will provide a favorable opportunity for the discussion of this matter.
Representative in Canberra.
– Has the attention of the Minister for Repatriation been drawn to the statement made last night at the annual congress of the Federal Capital Territory branch of the Returned Sailors and Soldiers Imperial League of Australia by the pensions officer, Mr. Honeysett, to the effect that it is not only desirable, but also absolutely necessary, that a representative of the Repatriation Department should be permanently stationed in Canberra? If the Minister is aware of the statement, and realizes the necessity for the suggested appointment, will he take such steps as are appropriate to have at least one representative of the department permanently stationed in Canberra?
– Mr. Honeysett waited on me and placed before me the matter referred to by the honorable member. I have been in touch with the Repatriation Commission, and have asked it to express its opinion on this subject. As soon as the reply is received, I shall be in a position to consider what ought to be done.
– In view of the fact that many of the occupants of “War Service Homes in the Barton and other electorates are unable to make the payments required for the supply of sewerage services, will the Minister in charge of War Service Homes arrange for a sum of money to be set aside to enable all occupants of these homes to be provided with this most necessary convenience, for which many of them have waited for one or two years?
– The policy of the commission is to make money available from time to time to assist those occupants who are desirous of having their houses connected with the sewerage system, and the work has been done as far as funds have permitted.
Person al Explanation.
– I desire to make a personal explanation. In the course of the tariff debate last weeek, the honorable member for Barker (Mr. Archie Cameron) quoted certain figures with regard to stripper harvesters, and I challenged their accuracy. I now find that his figures were correct, but they related to 8-ft. stripper harvesters, whereas I was referring to 6-ft. machines.
j? onn al Motion foe Adjournment.
I have received from the honorable member for Bourke (Mr. Blackburn) an intimation that he desires to move the adjournment of the House this afternoon for the purpose of discussing a definite matter of urgent public importance, namely, “ The acceptance by the Honorable the Attorney-General for the Commonwealth, who is to represent the Commonwealth in an appeal pending in the Privy Council, of a brief from other persons or bodies concerned in such appeal “.
Five honorable members having risen in support of the motion,
.- I move -
That the House do now adjourn
I desire to draw the attention, primarily of the House, and, secondly, of the Government, to what I regard as a very great error in judgment that has been made by the Attorney-General (Mr. Menzies) and by the Government itself - if the Government is privy to it. I suggest that at this date the error is not irretrievable, but can be corrected. There is before the Privy Council an appeal from the High Court of Australia in the case of James versus Tha Commonwealth. This case is the last stage of a chain of litigation which has called into question the competence of any Australian parliament to disregard section 92 of the Commonwealth Constitution. In 1932, there went to the Privy Council an appeal in which the power of the State of South Australia to restrict its commerce between the States was in question, and the Privy Council decided that the States were bound by section 92, but left open the question of whether the Commonwealth was bound by it. This point has been raised by the proceedings in James versus The Commonwealth. The High Court decided that the Commonwealth was not so bound, and leave to appeal from the decision was sought and granted on the 4th or 5th of December. I say on the 4th or 5th of December because, on the 7th of December, there appeared in the Melbourne Argus a cablegram from Great Britain, dated the 5th of December, notifying that leave to appeal had been granted. But it is immaterial whether it was granted on the: 4th or the 5th of December. By reason of that leave, the matter will come up for argument before the Privy Council, and I understand that the case will be proceeded, with during April.
On behalf of the Commonwealth, the Attorney-General has gone to England, and I have ascertained that he is representing in the same case before the Privy Council, not only the Commonwealth of Australia, whose Attorney-General he is, but also the State of Victoria, if not other bodies. My information, which I arn satisfied is correct, is that he is receiving in the same appeal either from the State of Victoria or from other bodies, which have joined Victoria, the sum of 2,000 guineas, to urge that the Commonwealth is not bound by section 92 of the Constitution. That is to say, he is to argue, on behalf of Victoria, the very thing that he is to urge on behalf of the Commonwealth. I did not. obtain this information until Monday of last week, but I got it from a member of the present Parliament of Victoria, the reliability of whose means of information is undoubted. I am informed that the honorable the Attorney-General has received a brief or briefs for the sum of 2,000 guineas, and that either he has been briefed by the State of Victoria and other bodies, which I propose to mention, or those bodies have contributed towards that sum. The other bodies whose names were given to me arc the Australian Dried Emits Board and the Australian Dairy Products Equalization Committee. Those bodies, of course, are probably under State constitutions, but they do interlock with Commonwealth instrumentalities; they could not work without the existence of these instrumentalities and the exercise of Commonwealth power. I propose, however, to discuss this matter on the basis that the only brief, the only fee or reward that thu Attorney-General is receiving, is from the State of Victoria.
I raise this matter at this stage, when the Attorney-General, unfortunately, is not present, because I believe that the error can still be corrected. The AttorneyGeneral yet has time to resign the brief that the Government of Victoria has given him and cease to represent that
State before their Lords of the P. ivy Council. If he does not do so, he will, in my opinion, be making a very serious error of judgment which will be regretted by everybody who knows him, and particularly by a man such as myself who has been closely acquainted with him and has admired him so long as I have. In this appeal case, the State of Victoria is adopting exactly the same attitude as is the Commonwealth; the interests of the two governments are identical, otherwise the Attorney-General of the Commonwealth would not have been given a brief by the State of Victoria. The argument that he will urge on behalf of the Commonwealth is that which he will urge on behalf of the State; what he will urge on behalf of the State he will urge on behalf of the Commonwealth. Nothing he can say on behalf of the State he is not already obliged to say on behalf of the Commonwealth. The matter of applying for leave to appeal does not arise, for leave to appeal was granted at the end of last year. So it cannot be said that the Privy Council will be influenced by matters of discretion or interests. The only point that will concern the Privy Council is the legal correctness of the judgment of the High Court of Australia.
As I have already said, no argument the Attorney-General can use on behalf of the State of Victoria he is not already bound to use on behalf of the Commonwealth. That being so, the objections that I take to his acceptance of a brief from the Victorian Government will be made plain in my subsequent remarks. It appears to me that the State of Victoria is paying unnecessarily a very considerable sum of money to have an argument put up on its behalf, but it is an argument which will not be put up. .It is not to be expected that the Attorney-General of the Common wealth will, on behalf of the Commonwealth, argue every point that can be argued, and then proceed to recapitulate exactly the same argument on behalf of the State of Victoria. A combined argument on all of the points will be advanced. Every point that can be argued in favour of the High Court’s decision the Attorney-General is bound to state as a matter of his duty to the Commonwealth which he is representing.
In such circumstances, the fee which he will receive from the State of Victoria will really be for something that the State could have got by sending along the veriest junior to inform their Lords of the Privy Council that the Government of Victoria concurred in the arguments which were being submitted by the Attorney-General on behalf of the Commonwealth of Australia. If the AttorneyGeneral desires to change his mind and relinquish his brief, the State of Victoria will, therefore, suffer nothing by it, because, as I emphasize, the necessary argument will be put up by him, as Attorney-General on behalf of the Commonwealth, and the State of Victoria will be required only to instruct the Attorney-General’s own junior, or some other junior, to inform, the Privy Council that, it concurs in, and adopts, all arguments put forward by counsel representing the Commonwealth. There is, therefore, no need for Victoria to spend any considerable sum at all.
The whole matter to be considered by the Lords of the Judicial Committee, let me repeat, is a legal one, all points of discretion and interest having already been disposed of by the granting of the leave to the appeal; and it seems to me to be a most important consideration that a Minister of this Government, who is a citizen of Victoria and the representative of a constituency in that State, should be receiving from the Government of his State a fee to do that which he is already under an obligation to do on behalf of the Commonwealth.
But the second and more important objection seems to me to arise under the Constitution of the Commonwealth of Australia. Section 45 provides that, in certain events, the seat of a member of the House of Representatives or the Senate becomes vacant; one of those events occurs if the member should directly or indirectly take, or agree to take, any fee or honorarium for services rendered to the Commonwealth. I ask honorable members to note the importance attached to- the words “ directly or indirectly”. That is to say, if the Attorney-General were to receive money from the Commonwealth, he would come within the ambit of that section; or if he were to receive money circuitously, through the intervention of any other person, he would also come within its ambit. It should be observed that section 45 does not use the words “ fee or honorarium from the Commonwealth “ ; and it therefore seems to me that the Attorney-General is doing something which, if it does not actually conflict with the letter of that provision, conflicts with the spirit of it. As Attorney-General of the Commonwealth and a member of this House, he may not receive any fee from the Commonwealth for services rendered to the Commonwealth, but he is receiving from the State of Victoria, solely or conjointly with other bodies, a fee for doing something which is “ service to the Commonwealth “. In my opinion, he is, in effect, rendering no service to the State of Victoria at all, but he is being paid by that State a fee which, by the way, he could not legally accept from the Commonwealth, to put up before the Privy Council an argument which his duty to the Commonwealth compels him to do, on behalf of the Commonwealth. I desire to emphasize that, there is nothing which he can say on behalf of Victoria that he is not bound to say on behalf of the Commonwealth. Therefore, it appears to me that, whatever may be the literal meaning of section 45 of the Constitution, the Attorney-General is offending against the spirit of it. It seems to me that he is also offending against the letter of it. I am aware that that section was inserted to deal with the position of counsel. An earlier section deals with the position of men who enter into a contract with the Government; but at the Federal Convention of 1897, in Adelaide, Mr. Carruthers, in raising this matter, said that it was desirable to deal with the position of counsel, because in two States - New South Wales and Queensland - counsel did not enter into contracts with governments. The matter was debated on several occasions, and ultimately section 45 was drafted in its present form.
I do not desire to expand the contentions that I have put forward. I repeat, that I consider that the proposed action of the Attorney-General is objectionable, first on the ground that the State of Victoria is paying him a considerable fee for rendering that which is in reality no service to it, and for doing nothing for it that he is not already bound to do for the Commonwealth; and secondly, because, by accepting the brief, he will receive, indirectly, a fee or an honorarium for services rendered to the Commonwealth. It is not necessary for me to say that I very much regret that the Attorney-General cannot bc in the House to hear the discussion, of this matter. I state my objections now, because it is not too late for the action of the Attorney-General to be reversed, and for him to announce that he will not appear as advocate of Victoria, or accept the proposed fee.
– The honorable member for Bourke (Mr. Blackburn) has raised a point which, I confess, did not occur to mc. I certainly understood from the verbiage of his motion that he proposed to censure the AttorneyGeneral (Mr. Menzies), for having accepted a brief from persons or bodies within the Commonwealth. The honorable member, however, has put an entirely different construction on his motion from that which I anticipated. In my opinion, there is no substance in the objection which he has raised. I am sure that the Attorney-General would be the first to express his appreciation of the manner in which the honorable member has dealt with this case, and for those expressions of esteem and admiration for his ability and reputation at the bar. I am bound to say, however, that the case made out by the honorable member is most unconvincing. The honorable member has contended that the AttorneyGeneral can render the State of Victoria no service by appearing on its behalf before the Privy Council; that in upholding the view he proposes to place before the Council, namely, that section 92 of the Constitution does not bind the Commonwealth, or, that if it does, the narrowest possible construction could be placed on that interpretation, he will be only anticipating or repeating what he could say on behalf of the State of Victoria. The honorable member has suggested that the State of Victoria is incurring expense which it can ill alford in thus separately retaining the services of the Attorney-General.
In reply to that, I ask what could be more proper than that the State of Victoria, which is vitally concerned in up holding the point that the AttorneyGeneral proposes to make before the Privy Council, should turn, when its interests are threatened, to a man who has been the Attorney-General of that State, and is a leading member of the Victorian Bar? The honorable gentlemen surely does not realize - 101’. at any rate, he did not place before the House - the inevitable consequences that would follow upon a decision by the Privy Council adverse to the Commonwealth. What those consequences would be needs no special emphasis, but I may be pardoned for mentioning them. An adverse decision would result in the wrecking of the various marketing schemes which are of the first importance to the State of Victoria, and the industries with which those schemes are associated would be thrown into confusion. In addition, the Commonwealth would lose its powers to legislate in respect of interstate trade, and a large body of existing legislation would become ultra vires, including the Australian Industries Preservation Act, the Secret Commissions Act, &c. The effect upon the industrial life of the country would be most unfortunate. The honorable member says : “ “Well, that may be quite true, but the Attorney-General would put his arguments with equal force if he had not been briefed by the State of Victoria as if he had “. I submit that that argument must necessarily apply to every case in which the same counsel appears for several litigants. The honorable member’s objection would fail entirely had the State of Victoria briefed another counsel. It fails utterly when applied to the State of New South Wales, which, in respect of this case, stands in almost exactly the same position as does the State of Victoria. The issue is one which goes to the very root of the industrial and commercial life of the State of New South Wales, and, though I am sure that Mr. Manning would be the first to admit that the Attorney-General of the Commonwealth would be capable of arguing the case with as much force and skill as he himself could do, the Government of New South Wales has nevertheless deemed it wise to brief Mr. Manning to represent it before the Privy Council. It is but natural, after all, that a State Government should desire to have special and individual representation. Nevertheless, when the interests of several litigants are identical, there is surely something to be gained in having the case put by one counsel.
– Not always.
– If not, it must be a reflection on the competency of the counsel who puts the case. When several litigants join together, and decide to retain the same counsel, it is a tribute to that man’s competency, because they believe that, by retaining that one man, their several interests will be better advanced than if each retained separate counsel.
There are many examples of this in the records of our courts. In the 44-hours case, which I am sure will appeal to the honorable member for Bourke, Owen Dickson, J. K. Street and R. G. Menzies appeared for several of the parties. In the case of the Federal Commissioner of Taxation versus Munro, reported in 38 Commonwealth Law Reports, at page 153, identical counsel was again retained by several of the litigants. In the case of the State of New South Wales against the Commonwealth, 46 Commonwealth Law Reports, at page 155, Victoria and Tasmania, having obtained leave to intervene, were each represented by C. Gavan Duffy, now a justice of the Supreme Court of Victoria. In the case Amalgamated Society of Engineers versus The Adelaide Steamship Company, 29 Commonwealth Law Reports, page 406-
– That is a different subject altogether.
– I am not able, of course, to make out a case and invent a subject. I am dealing with the subjects as they are. In the present instance we have an appeal to the Privy Council against the decision of the High Court of the Commonwealth, and the point involved is whether, in accepting a brief from the State of Victoria, the AttorneyGeneral of the Commonwealth has been guilty of any improper conduct.
– Hear, hear ! That is the point.
– So far we are in agreement. We can test the propriety of actions of a professional or public man only by references to rules which are generally observed in public life and in the profession concerned.
– Conditions must be similar.
– I am pointing out to the honorable member that the conditions are similar : that in several cases before the Arbitration Court, and in an appeal to the High Court - the Federal Commissioner of Taxation versus Munro - one counsel appeared for several parties.
– And drew fees from all the parties represented.
– That is not so in this case.
– Order ! These interjections must cease.
– I shall deal with that point in a moment, and then, no doubt, honorable members opposite will be able to exploit that spirit of patriotism that makes them so notorious throughout the Commonwealth.
– I don’t suppose our services will be valued at £25,000.
– Every man gets what he is worth.
– In the case Amalgamated Society of Engineers versus The Adelaide Steamship Company, 29 Commonwealth Law Reports, page 406, Sir Edward Mitchell and Mr. Owen Dixon appeared for five States. The interests of each of those States were identical, yet two counsel appeared for the five States.
– Was either of them a State Attorney-General?
– No, but the point stressed by the honorable member for Bourke was that, when one counsel appeared for many litigants he merely repeated the arguments for the other four when he represented five litigants, and the other one when he represented two litigants. In other words, irrespective of the number of litigants he represented, counsel, in such cases, relied solely on the case of his original client. The honorable member suggested that in this case the AttorneyGeneral has been guilty of impropriety, but did not explain how that could be. The Attorney-General will not receive one penny in fees for appearing for the
Commonwealth, in this case. Honorable members should not forget that fact.
– He is well paid now.
– He is not.
– Then why does he not turn up the job?
– With all due deference, I submit that this bar-room repartee is out of place. Underlying the motion is a suggestion that the Attorney-General has been guilty of some impropriety.
– Error of judgment, I should say.
– Statements have been circulated, in the press and elsewhere, which reflect grossly upon the personal character of my colleague, holding him up as a grasping and avaricious man who is ready to sacrifice public interests for his own pecuniary gain. I owe it to him to show that there is not a shadow of justification for such charges. When I heard that the honorable member for Bourke intended to move this motion I thought it proper that I should communicate with my colleague on the matter and ask him for a statement, and he has furnished me with such a statement. I communicated with him as follows -
Blackburn, member for Bourke, intends, on Friday or on Tuesday next, to move the special adjournment, nf tlie House of Representatives in order tn discuss action stated to have been taken by you in accepting in James’s case, a brief from other persons or bodies, which are concerned in Hint case, while you are, at the same time, holding a brief us representing the Government of the Commonwealth. I shall be glad to receive advice as to the lines upon which you would desire that the matter should be put. I shall he ..1 ad to know whether, in case any question is raised, the Minister may give an assurance that the interests of the Commonwealth in this case are of paramount consideration and that any other persons or bodies represented by you would be represented only insofar as the interests of those persons or bodies coincide with and support the interests of the Commonwealth.
To this communication my colleague replied -
Concerning motion to be moved by Blackburn I am appearing before the Privy Council for the Government of the Commonwealth and for the State of Victoria only. I agreed to appear for the State of Victoria only after a full discussion had indicated that there was no possible conflict of argument. Both the Commonwealth and the State are equally concerned to uphold the validity of marketing schemes. The instructions which I have received from the State are, in the first place to uphold the view that section 92 of the Constitution docs not bind the Commonwealth, and, in the second place, if that section does bind the Commonwealth, to contend that the section has the narrowest possible meaning. This is identical with the case which I shall be submitting for the Commonwealth Government. The true interests of the Commonwealth are best served by a joint argument being made before the Privy Council on behalf of as many Governments as possible. Tlie printed case which is being lodged for the Statu of Victoria simply adopts the case for the Commonwealth.
These communications, I submit, clearly indicate that my colleage has done nothing that conflicts with true interests of the Commonwealth Government. * Leave to continue gwen.]* The honorable member for Bourke did not contend that the interests of the Commonwealth Government would suffer through the action ‘being taken by the Attorney-General in this case. He suggested, first of all, that he considered it was unwise for the Attorney-General to have accepted this brief.
– I said that it was wrong for the honorable member to have done so.
– Secondly, the honorable member suggested that, through the action taken by the Attorney-General the State of Victoria was put to unnecessary expense. If the honorable member for Bourke says that it is wrong for the Attorney-General to accept a brief and to put forward the same argument on behalf of more than one client, he must condemn a practice which is general in the profession of which he is a member. It is not unusual, as I have already pointed out, for one counsel or a set of counsel, to represent many parties. In the pending legislation the parties that are vitally concerned, such as those engaged in the dried fruits and butter industries, are naturally anxious that nothing shall be left undone that might advance their interests and prevent a decision by the Privy Council which would destroy our present marketing scheme and work havoc on the general community. It is said that the AttorneyGeneral has done something wrong. In what way is it wrong? It is not wrong according to the practice of the profession ; that is very clear. If the honorable member for Bourke says that the
Attorney-General for the Commonwealth is not entitled to accept a brief, it can only be on the ground that the acceptance of that brief would prejudice the interests of the Commonweal th.
– I said that his action is in conflict with the spirit and, 1 believe, the letter of section 45 of the Constitution.
– With all due deference to the honorable member, I cannot accept his interpretation of section 45. It is novel, and places upon that section an interpretation which I do not think the best authorities will support. However,I shall leave that phase of the subject, because that, was not. the main argument of the honorable member.
– He said that it was most important.
– He does not say the action of the Attorney-General is wrong because it is supposed to contravene section 45 of the Constitution, but because the Attorney-General ought not to have accepted this brief. He says that there is yet time to repair the error. If the Attorney-General’s action falls within section 45 of the Constitution, he cannot escape the consequences of his act. Nothing he can do now can remove him beyond section 45, because he has already accepted this brief and the fee accompanying it; the provisions of the section apply and his seat; becomes vacant. But I submit that the section does not apply. I turn to another point.
I have said that my honorable colleague has been held up to odium and the contempt, of the public as a grasping and avaricious man. What is the position of the Attorney-General of the Commonwealth? First of all he . is the legal adviser of the Commonwealth.
– He is the watchdog of the Commonwealth.
– The AttorneyGeneral is the legal adviser of the Commonwealth. He is to appear for the Crown in a contentious case. He is precluded from accepting a brief against, the Crown.
– Or from the Crown.
– Quite. He is precluded from accepting a brief against the Crown, or against any department of the Crown. He receives no fee for appearing for the Crown. He has the right of private practice, but that right is strictly limited. It is limited in the first place by the rule that he cannot appear for a client whose interests conflict with those of the Crown; and, secondly, in a practical way, by hiscircumstances, geographic and other, as a member of a government or of Parliament itself; and unless he is to withdraw entirely from active participation in legal practice, he must take advantage of opportunities that offer. It is suggested that he is to receive a fee of 2,000 guineas.
– I understand that that is the fee.
– The honorable member speaks as if that were a fabulous sum. There is a suggestion, as I have said, that my colleague is to act in this case for pecuniary reward. When we are in doubt as to the proper course to be adopted by public men, or members of the legal profession, we turn to England. The position of the Attorney-General in Great Britain is very different from that which obtains here.
– Then why refer to it?
– Before doing so, I should say that, while it is the practice of the Commonwealth and in several of the States, that the Attorney-General may not receive fees for appearing for the Crown, that practice does not prevail in all of the States. I remind the honorable member for Bourke of the case with which he is familiar in which the late Honorable T. J.Ryan appeared. What is the position in Great Britain? Formerly, the Attorney-General in England was entitled to the right, of private practice without restriction. In 1892 certain modifications were introduced, and the salary was fixed at £7,000 per annum, with fees for contentious business, but the right of private practice was abolished. In 1894, the salary was increased to £10,000 per annum, but no fees were allowed for contentious business. In 1895 the salary was reduced to £7,000, with the right to take fees for contentious business, but not the right of private practice, vide Encyclopaedia of the Laws of England, volume I, page 628. In 1931 the salary was reduced from £7,000 to £,2,000, but the Attorney-
General continued to receive fees for contentious business, which were much larger than the salary received. In 1929-30, for instance, the fees of the Attorney-General, in addition to his salary, amounted to £17,570 (Whitlaker’s Almanac of 1936, page, 267, and the House of Commons Parliamentary Debates 1930-31, volume 257, page 525). In 1935, the salary was increased to £4,500, as being the salary for noncontentious business. In addition, he receives fees for contentious business according to the ordinary professional scale (Civil Estimates for the year ended the 31st March, 1936, class III., on page 75). So that, in England, to which we look, and on which we pattern ourselves, we find that the Attorney-General is paid fees for appearing for the Crown, and his fees for the last year for which we have a record were very much in excess of his salary.
I shall now turn again to the position of the Commonwealth Attorney-General. The Attorney-General is paid the ordinary ministerial salary. I shall refrain from stating the amount of it, but will content myself with saying that when I was Minister for External Affairs 30 years ago, I received a salary which, judged by its purchasing power, was more than double that which I receive to-day.
– That applies to a good many other people.
– I think that one must look with exquisite longing to the good old days.
The public is being invited to believe that my honorable colleague has done something not merely improper, but also, according to the honorable member for Bourke, quite wrong, and this wrong will be associated, in people’s minds, with the fees that the Attorney-General is receiving. But the public should know that by accepting the office of Attorney-General, and joining this Government, the AttorneyGeneral cut himself off from sources of emolument from three to five times larger than the salary he is now receiving. My colleague has not been guilty of any improper practice, much less of any wrong-doing. The true test of impropriety in the action of a public man must be its effect upon the public interest. The public interest of the Commonwealth, I submit, is not suffering in any way from the action of the Attorney-General. That honorable gentleman has observed most scrupulously the conventions and usages of his profession. By his presence in the Government he has shown that he places the public interest above his own private interest. In the case now before the Privy Council, it is of vital importance that the very best man that could be obtained should be secured to state the view of the Commonwealth Government. Supposing the Attorney-General had not held the high office that he holds in this Government, would not the honorable member for Bourke say that he is at least as well fitted as any other member of the Bar in any of the States to argue the case before the Privy Council?
– Of course I would say that.
– It was of the very greatest importance that the best assistance available should be obtained in connexion with this case, for the decision upon it is vital to the Commonwealth. If the Privy Council should decide in favour of the petitioner, hideous legal chaos would follow. In addition, we should be forced to consider the making of an amendment of the Constitution.
– The right honorable gentleman’s extension of time has expired.
.- The defence of the Minister representing the Acting Attorney-General (Mr. Hughes) of the Attorney-General (Mr. Menzies) against the accusations of the honorable member for Bourke (Mr. Blackburn) has been marked by a great deal of irrelevancy and also by failure to appreciate the basis of the charge that was made. Briefly, the charge is that the Commonwealth Attorney-General, in pursuance of his duty to the Commonwealth, has been obliged to proceed to London to appear on behalf of the Commonwealth in certain proceedings before the Privy Council, the importance of which for the moment is immaterial ; that it is his duty to represent the Commonwealth, without fees, in a matter involving the exercise by this Parliament of powers which are presumed to be within the constitutional authority of the Parliament; and that he has, in fact, accepted fees for doing so. The right honorable member for North Sydney (Mr. Hughes) admitted that the Commonwealth Attorney-General might not accept a fee for appearing against the Crown; but our contention is that he may not even accept a fee for appearing on behalf of the Crown. The acceptance of the office of Attorney-General by u member implies on his part a willingness and an obligation to appear for the Commonwealth in matters involving the Commonwealth interests in return for the salary and expenses provided for him. That should represent the exclusive reward an Attorney-General of the Commonwealth should expect or be given for his duties as Attorney-General. The Constitution of the Commonwealth obviously implies that. The references made by the right honorable member for North Sydney to the position in Great Britain were obviously beside the point. As a matter of fact, it was after a consideration of what was taking place in Great Britain, that the framers of the Commonwealth. Constitution provided that fees should not be paid to a Commonwealth Attorney-General for appearances on behalf of the Commonwealth. It is incontestible that if the Attorney-General had not gone to Loudon to appear for the Commonwealth, he could not have done so to represent the State of Victoria in the same proceedings, because his duty to Australia, as Commonwealth AttorneyGeneral demanded that he should give the major part of his services to the Commonwealth. It is obvious, therefore, that the presence of the Attorney-General in London is in pursuance of his duties as Commonwealth Attorney-General. The honorable member for Bourke has stated that because the duties of the Commonwealth Attorney-General took him to London in connexion with a pertain case, he has been able to capitalize his office by accepting a brief, valued, I understand, at 2,000 guineas, for an appearance on behalf of another authority which happens to have an interest in this matter coincidental with that of the Commonwealth. The happy circumstance that there is another litigant with some interest in a case in which the Commonwealth is involved has enabled the Commonwealth Attorney-General to receive what is equivalent to a fee for carrying out his duty to the Commonwealth. The gravamen of the charge made by the honorable member for Bourke against the Attorney-General is that, because of his appearance in these proceedings as the representative of the Commonwealth Government, he will receive a fee amounting to 2,000 guineas. The whole spirit of the Constitution and the consistent practice of every honorable gentleman who has hitherto held the office of Commonwealth Attorney-General have been totally at variance with any such procedure as that now charged against the present Attorney-General. The right honorable gentleman in his defence on behalf of the Attorney-General - and I have no pleasure in speaking in this way in the absence of the AttorneyGeneral, I would much prefer that he be present to answer me to his best means if an answer be at all possible - said that it was the practice in the courts for counsel to represent groups of litigants, and to receive fees from all of them. We are unconcerned with what is the practice in the courts. No counsel has hitherto appeared in proceedings before the Privy Council as the Attorney-General and as the representative of the Commonwealth, and at the same time represented other parties and taken fees from them. In all precedents and examples which the right honorable gentleman has attempted to cite as relevant, he has never once cited a case in which the Attorney-General before the High Court or the Privy Council was able to appear, not only for the Government of the Commonwealth, but also for some other person or interest, and accept a fee from that other person or interest. There is, as the honorable member for Bourke has said, not only objection to this practice, but also I think, it sets a standard in connexion with the office of Attorney-General which the Parliament ought to refuse to countenance. Commonwealth members are not well paid, but they do give exclusive services to Australia insofar as they are able, and do not, whilst so engaged, accept fees or emoluments from other persons simply because those other persons happen to have something in common with the Commonwealth. The Attorney-General could appear in these proceedings before the Privy Council effectually and completely in the interests of the State of Victoria, without fee or reward, because, as the honorable member for Bourke has said, he is appearing in the interests of tlie Commonwealth; on the other hand, while acting for Victoria he could say not one single word more in defence of the interests of Victoria and its marketing schemes and of the powers of the Commonwealth Parliament than he would be able to say if he appeared exclusively for the Commonwealth Government, and therefore had no brief or fee from any other body. It is wrong, I submit, at this stage, after three and a half decades of Commonwealth history, to upset all tradition and for the Commonwealth Attorney-General to take advantage of his office to earn a fee very substantial in dimensions, and which he would not earn but for the fact that his duties as Attorney-General put him in the position of being able to earn them. While those who believe in what they call the conventions of the law say that this practice is perfectly proper because Ministers in Great Britain receive larger fees and higher salaries, it is entirely beyond the point; it is irrelevant, and, furthermore, was rejected by the people of Australia and the writers of the Constitution. We have set ourselves against this practice. Members of Parliament and Ministers of the Commonwealth should be paramountly the servants of the people of Australia. The right honorable gentleman said that the AttorneyGeneral will get no fee from the Commonwealth for the work he will do in appearing before the Privy Council. That is not altogether true. He will receive his salary. It will be as great as that which the Minister for Repatriation will receive for doing his work. The nature of tlie work a Minister does is unimportant, because ministerial salaries are not graduated on the basis of the superiority of one department over another. I agree that the Ministers are not too well paid. But we have said to the people of Australia that we are prepared to sacrifice a large measure of other interests as citizens in order to have the honour and distinction of being the servants of the people of
Australia in this Parliament. We make these sacrifices cheerfully, and other Ministers besides the Attorney-General have given up something very substantial by their devotion to public interests.
As the honorable member for Bourke has said, the Attorney-General has done a wrong thing. Some time ago I asked whether the Attorney-General was appear ing exclusively in this case, because I had heard rumours that he was not; and 1 was staggered when I heard from the Prime Minister (Mr. Lyons) that the AttorneyGeneral had received a brief from another government, although the right honorable gentleman said that he did not know what was the amount of the fees to be paid. This Parliament should lay it down that the Attorney-General must have no other interest whatever. The clearest way to make that interest above suspicion is for the occupant of the office to have no expectation or possibility of reward other than the salary received by him as Attorney-General.
.- The Leader of the Opposition (Mr. Curtin) has just suggested that reference to the English practice is irrelevant, but, as in other countries besides Great Britain, the position of the chief law officer has been singled out as one for special attention, I think we can properly examine that position from the Australian point of view. In Great Britain in the early stages there was no restriction on the right of the AttorneyGeneral to private practice, but in 1S95 this right was abolished; and since then, as the right honorable member for North Sydney (Mr. Hughes) has pointed out, the Attorney-General has received a parliamentary salary which amounts now to £7,000 per annum, less the emergency reductions, together with fees on Crown briefs which amount on an average to £15,000 per annum. When in 1789 the Judiciary Act. of the United States of America was passed, it was assumed that the AttorneyGeneral would devote a comparatively short part of his time to the service to thf State, and his emolument, was therefore fixed at 1,500 dollars per annum. It was thought that because of his high office he would the more readily receive fees for his services in private practice.
It is only with the growth of the importance of the office and the extra demands on the time of the AttorneyGeneral in the United States of America that that practice has disappeared. The chief law officer now receives a much higher salary, but he devotes his entire time to the affairs of the State.
It was suggested by the Leader of the Opposition that the people of Australia in accepting the Federal Constitution had rejected the English practice and had declared that, far from the chief legal officer receiving fees for cases in which he appeared for the Commonwealth, he should not under the Constitution be allowed to receive such fees. There was, however, no restriction placed by the Constitution upon the right of private practice. It was never contemplated that the Attorney-General of the Commonwealth should be debarred from private practice and never has he been so debarred. I simply wish to elaborate the point that in Australia it is an established principle that a Commonwealth Attorney-General should retain the right of private practice. Whether honorable gentlemen think that that position should be altered or not rests with themselves. But if a change is contemplated, it should be borne in mind that in other countries special attention has been given always to the peculiar position of the chief legal officer. That assumption having been accepted, let us examine the facts of this particular case. The mover of the motion based his condemnation on the main ground that the Attorney-General was violating, if not the letter, at any rate the spirit of section 45 of the Constitution, which disqualifies a member of this Parliament who directly or indirectly takes or agrees to take any fee or honorarium from any person or State for services rendered to the Commonwealth Parliament. The honorable member said that there was a breach of the spirit of the section because the Attorney-General, when he appears before the Privy Council, would not be rendering any service to Victoria as distinct from the service he would be rendering to the Commonwealth. If that argument be correct, we have to consider the fact of the Attorney-General having been briefed, first, by the Com monwealth Government, and subsequently by the Country party Government of Victoria, which remains in office only because of the support of the Labour party to its legislative proposals. Can we imagine the Government of the State of Victoria, under these circumstances, paying to the Attorney-General of the Commonwealth a fee of 2,000 guineas for doing something which he would in any case do for the Commonwealth ? In other words, are we to suppose that Mr. Tunnecliffe and Mr. Dunstan have agreed to make a present of 2,000 guineas to the Attorney-General of a United Australia party Government?
– Mr. Tunnecliffe is not in the Victorian Cabinet.
– If the honorable member for Capricorn ia (Mr. Forde) were in as close touch with the political life of Victoria as I and some other honorable members are, he would know that Mr. Tunnecliffe frequently claims, through the press and otherwise, that he and his party are chiefly responsible for the actions taken by the present Government of Victoria. We may be reasonably certain that, whatever action was taken by that Government to secure the services of the Attorney-General of the Commonwealth, was taken with the full knowledge and approval of the Labour party in Victoria.
– The Labour party would not be consulted in such a matter.
– If the honorable member is correct, and the Labour party was not consulted, does he think it possible that the Victorian Country party Government would virtually make a present of 2,000 guineas to the Attorney-General of another government; - and a United Australia party government at that - for doing nothing? If that is not the position, we have to consider what service the Attorney-General of the Commonwealth could render to the State of Victoria which he would not render in presenting the case for the Commonwealth? The Attorney-General will contend, on behalf of the Commonwealth Government, that the Commonwealth is not bound by section 92 of the Constitution. We may imagine the Privy Council saying to him, “You are claiming for the Commonwealth very wide powers; powers which may vitally affect the States, and which may be obtained at the expense of State powers. Do not the States disapprove of your claim and oppose your argument “ ? In that event the Attorney-General of the Commonwealth would now have the very best possible answer ; he would be able to show that, in regard to this issue, the interests of the governments of the several States, and of the Commonwealth, are identical. He could point out that the Government of the State of Victoria desired that a decision should be given in favour of the Commonwealth Government. What better argument could the State Government place before the Privy Council? And what better service could the AttorneyGeneral of the Commonwealth render to the State than by making it clear, by his appearance, representing the interests of the Commonwealth and the interests of the State of Victoria, that there was a community of interest, and a common desire to obtain a decision in favour of the Commonwealth Government? In my opinion, no better reply to the allegation that the AttorneyGeneral will not render any service to the State Government could be advanced.
Before I conclude, I wish to refer to the statement by the Minister for Repatriation (Mr. Hughes),, that the AttorneyGeneral of the Commonwealth is underpaid. The suggestion, that if the Attorney-General is not satisfied with his present position he should return to private practice, was not made by the honorable member for Bourke, who, in his speech, stated that he recognized the ability and probity of the AttorneyGeneral; but that suggestion was made by certain honorable members. That such suggestions and innuendoes should be made in this National Parliament explains, in part, why more men of the calibre of the Attorney-General do not aspire to parliamentary honours. That a man of his undoubted ability should, out of a sense of public duty, accept an office which involves him in considerable financial loss, is the most effective answer that could possibly be made to any charge of impropriety in connexion with his appearance before the Privy Council on behalf of the State of Victoria.
– The Minister for Repatriation (Mr. Hughes), who in this chamber represents the Acting Attorney-General (Senator Brennan), has shown that there is nothing unconstitutional in the action of the Attorney-General accepting a brief, if in doing so he does not act against the interests of the Crown. In some States, laymen have occupied the position of AttorneyGeneral. Should litigation in which the Crown is involved arise at such a time, it is customary to obtain the services of the gentlemen most qualified to represent the interests of the Crown. There is no obligation on an Attorney-General to accept a brief on behalf of the Crown, or to attend personally in court and present the Crown case. An AttorneyGeneral is free to appoint some one else to act for him. From the point of view of his private interests, it may be that an Attorney-General of the Commonwealth is unfortunate in that, at a time when the best professional services available in the Commonwealth are required by the Crown, he happens to be Attorney-General. In considering this subject it is well to bear in mind the possibility of the Attorney-General having been approached by interests in Victoria, in his private capacity, before agreeing to represent the Commonwealth Government before the Privy Council. In my opinion, the AttorneyGeneral is entitled to any fees which he can earn in securing to the Commonwealth the powers which it claims in respect of legislation passed in the interests of primary producers. It may be that the offer of fees to the AttorneyGeneral by another interested party made it possible for the Commonwealth Government to be so ably represented before the Privy Council. I do not see how any legal practitioner could afford to leave his business in Australia and proceed to England and argue a case without remuneration. As one who is greatly concerned with the interests of the primary producers of this country, I have frequently urged that the AttorneyGeneral himself should represent the Commonwealth Government at the hearing of this important appeal. Indeed, on two or three occasions, I have asked the Prime Minister whether it was not possible for the Attorney-General to appear on behalf of the Commonwealth. Some time elapsed before the Government announced that the AttorneyGeneral would represent it before the Privy Council. I do not know the reasons for the delay, but I do know that the primary producers of Victoria were determined that the best possible advocate should appear on their behalf when the appeal was heard. The Victorian Government realized that the best man to represent it at the Privy Council appeal was the Attorney-General of the Commonwealth, andI believe that strong representations were made to Mr. Menzies to conduct the case on its behalf long before he agreed to represent the Commonwealth. Considering the loss of professional einoluments consequent upon his absence abroad-
– Surely that is irrelevant.
– It is not so irrelevant as some of the remarks made by the honorable member. The right honorable member for North Sydney dealt very clearly with the constitutional issue, and his arguments must have convinced honorable members generally that nothing in the Constitution prevents the Attorney-General of the ‘Commonwealth from accepting a brief from the Victorian Government. The Constitution merely provides that the Attorney-General of the Commonwealth shall not accept a brief against the interests of the Crown, nor shall he receive any remuneration for conducting a brief on behalf of the Commonwealth. In urging the Attorney-General of the Commonwealth to represent it in a matter of such importance, affecting both Commonwealth and State marketing legislation, the Victorian Government had at heart the interests of the primary producers. If the case for the State were not properly represented a chaotic state of affairs in the marketing of primary products would be brought about, a great deal of beneficial marketing legislation might bo declared invalid, the time and labour spent in building up marketing organizations in Australia be lost, and the producer would be the sufferer. This case involves both interstate and intra state interests, and the Privy Council might be influenced by the former as against the interstate interests which the Constitution particularly protects. As pointed out by the honorable member for Fawkner (Mr. Holt) the fact that the Attorney-General, in representing the Commonwealth will also be able to say that he is briefed to represent intra-state interests as well, will dispose of the claimant’s case. After all, the Constitution provides a safeguard for the interests of the individual States. In this case one of the most important States has briefed the Attorney-General of the Commonwealth to put before the Privy Council views identical with those which he proposes to submit on behalf of the Commonwealth Government. The State of New South “Wales has briefed its AttorneyGeneral (Mr. Manning). Why should Victoria send its Attorney-General or brief a private practitioner when Mr. Menzies can represent both Commonwealth and State? In this case interstate interests and State interests are represented by the same counsel, and that happy combination will strengthen the defence of the respondent governments in the appeal before the Privy Council. I am pleased as a representative of primary producers that the AttorneyGeneral is representing not only the Commonwealth, but also the Government of Victoria.
– The honorable member for Bourke (Mr. Blackburn) has raised this important issue in a very clear, temperate and restrained speech, but I venture to submit he has not sustained his point. The Attorney-General of the Commonwealth (Mr. Menzies) occupies an exalted and responsible position as leader of the bar of the Commonwealth. We can assume that before any action was taken by him in regard to this matter he had a very clear conception of the duty he owed to the legal profession as its leader, and to the Commonwealth of Australia as its Attorney-General. The honorable member for Bourke made an important admission when he said that in this case the interests of the Commonwealth and the State of Victoria are absolutely identical. As regards the right of the AttorneyGeneral to accept a brief from the Victorian Government, it is accepted in practice that any barrister has a right to represent a number of parties in litigation. For instance, in will cases on innumerable occasions, barristers have represented a number of varying interests, sometimes the trustee, the executor, and other parties. The rule laid down in Halsbnry’s Digest is that counsel ought not to appear for two clients whose interests may conflict. Therefore, according to this high authority, the AttorneyGeneral commits no breach of professional etiquette when he appears for two clients whose interests, far from being conflicting, are identical. As the leader of the bar in the Commonwealth his position is unassailable; but because he is a member of this House and the AttorneyGeneral of the Commonwealth it is contended that his position is altered. Will that argument hold water? The honorable member for Bourke raised two objections to the acceptance by the Attorney-General of a brief from the Victorian Government. First, that Mr. Menzies, being a Victorian citizen, and the case involving Victorian interests, he should not appear for the State.
– I did not say that.
– The honorable member said that the Commonwealth Attorney-General ought not to receive a fee from the Victorian Government.
– I did not say that. My contention was that the AttorneyGeneral should not receive a fee from the Victorian Government for doing nothing.
– Is the Attorney-General to do nothing for the State? What are the facts? The Victorian Government wanted a barrister to represent its views before the Privy Council. It could have selected any barrister for this task, but it desired to secure the services of an advocate familiar with the Victorian position, one who had been . State Attorney-General and had studied the operation of section 92 entirely from the State point of view. That view is not in conflict with the Commonwealth’s view.
– The AttorneyGeneral says that Commonwealth and Victorian cases are identical.
– Still in the conduct of the case the Privy Council might call upon counsel to argue on the distribution of power between the Commonwealth and the States.
– Hear, hear; and the interests of the two might conflict.
– In this case they cannot conflict, because both parties are putting up the same resistance to the claims of the appellant. Therefore the intepretation given to this section is such as to justify the Victorian Government in seeking the services of a Victorian barrister, and the State Government will certainly get something for the fee which it will pay to the honorable member.
The next point taken by the mover of the motion is that the Attorney-General, in indirectly receiving a fee from the Victorian State Government, is acting in contravention of section 45. When the Federal Conventions were discussing the framework of the Constitution of the Commonwealth, it was the practice of Attorneys-General to appear in courts, and, although they were in receipt of their ministerial salaries, to charge and receive from the revenues of the Crown, fees according to the prescribed scale.
– At that time also it was customary for members of Parliament who were barristers to appear in cases in which the interests of the State were involved, and to be paid fees for their services. A similar situation had arisen in England, and as members will see it is dealt with at page 82 of May’s Parliamentary Practice, Tenth Edition, which we take as our guide : -
To guard against indirect influence, it (the law of Parliament) has further restrained the acceptance of fees by its members, for professional services connected with any proceeding or measure in Parliament.
A member is accordingly incapable of practising as counsel before theHouse or any committee. By resolution 26th February, 1830, members of the House of Commons are prohibited from engaging, either by themselves or by a partner, in the management of private bills, before this or the other House of Parliament, for pecuniary reward.Nor is it con- sistent with parliamentary or professional usage for a member to advise, as counsel, upon any private bill or other proceeding in Parliament.
The purpose of section 45 is to prevent a member of the Parliament from being paid a fee or honorarium for services rendered to the Commonwealth, and the contention of the honorable member for Bourke is that the Attorney-General will receive, indirectly, a fee or honorarium for his brief by the Victorian Government. Whetherhe is receiving a fee indirectly is a question of fact, andI submit, that he is not being paid indirectly.
– The honorable member has exhausted his time.
.- I agree with the honorable member for Darling Downs (Sir Littleton Groom) that the honorable member for Bourke (Mr. Blackburn) is to be congratulated on. the temperate and impersonal manner in which he has presented his case against the acceptance, by the AttorneyGeneral (Mr. Menzies), of a brief from the Victorian Government to appear before the Privy Council in the circumstances mentioned. I might add, from my point of view, that he is also to be congratulated for the convincing manner in which he stated his argument. I should not like to drag this discussion down to the level on which the honorable member for Fawkner (Mr. Holt), quite unlike himself, sought to place it, or the level to which the honorable member for Wide Bay (Mr.Corser) tried to reduce it. It must be obvious that whatever pecuniary loss the Attorney-General may suffer by his acceptance of this brief on behalf of the Commonwealth or on behalf of a State or any other client that may be mentioned is quite beside the question. Beside the question also are the comparatively high rewards given to members of the English bar and the bar of other countries. This subject has been very well discussed on at least two occasions within my own experience in this Parliament and on other occasions in other Parliaments. My right honorable friend the Minister for Repatriation (Mr. Hughes) will remember the very animated debate that took place in con nexion with the acceptance, by the then Attorney-General of the Commonwealth, of a general retainer from a company with which the Commonwealth was engaged in litigation at the time.
– The honorable member is referring to the Marconi case?
– Yes. Later there was an interesting discussion in this Parliament when the Attorney-General accepted a brief to represent private interests before a royal commission appointed ‘by the Common wealth.
The inference which I have drawn from these various discussions, and the declarations, by those experienced in such matters, of what is right and proper, is that the important question is - What is the “public interest”? It is not what is the private interest, not what are the private rewards, not what are the personal sacrifices; for, in the case of public men, their disinterested and undivided allegiance to the public interest, is demanded.
The submission which I make in this case is that a conflict of interest is involved in the acceptance, by the AttorneyGeneral, of these various briefs; or, if there is not this conflict of interest, the Attorney-General is acting in breach of section 45 of the Constitution which declares that he shall forfeit his seat if, directly or indirectly, he takes or agrees to take, any fee or honorarium for services rendered to the Commonwealth. In a word, as I think the honorable member for Bourke put it, either he is accepting fees for services rendered to the Commonwealth or he is not. In the latter event he is serving two masters with potentially coinciding interests. Let us consider for a moment section 92 of the Constitution. It reads-
On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free. . . .
The question before the Privy Council is whether that section does or does not bind the Commonwealth. My view is that the whole section is charged with differences of opinion, actual or potential, between those representing the Commonwealth and those representing the States. I cannot believe that the Attorney-General can wholeheartedly and adequately present the argument for the Commonwealth without detriment to the State, and vice versa. At least he would necessarily be hampered by the danger of conflict. That view, I understand, has not yet been submitted.
– The honorable member differs from the honorable member for Bourke?
– No. I go further than the honorable member for Bourke in that respect; I say that submission of the view of the Commonwealth cannot be made wholeheartedly without the probability of detriment to the interests of the State. As the honorable member for Bourke has pointed out, the Attorney-General, being bound by the requirements of his high office, cannot conceivably divide his allegiance, so to speak, between the State and the Commonwealth ; that insofar as he argues in favour of the special interests of the State so as to justify his acceptance of its brief, to that extent his argument is likely to be a derogation from the claim of the Commonwealth upon him, that he shall give his undivided attention to the interests of the Commonwealth.
– Does the honorable member say that the interests of the State and the Commonwealth are in conflict?
– As the AttorneyGeneral himself has said, they do not necessarily conflict in their bare outline or in their broad statement of principle; but it is extremely likely that in the course of argument at some point and conceivably at many points, conflict will arise. The very danger of its arising is in itself sufficient ground for urging upon the AttorneyGeneral the discontinunce of the course he has adopted.
– That would apply in all eases in which one counsel appeared for more than one party.
– No. The right honorable gentleman seems to have overlooked the fact that the State is merely an intervener in, not a party to, these proceedings; it comes into the case of its own volition merely to place before the Privy Council its own special view as a State of the Commonwealth. Moreover, the State and Commonwealth Governments are trustees for their people, and the courts are very jealous of the rights of beneficiaries in the matter of representation. I should very much prefer to have the AttorneyGeneral in Australia lending the weight of his great ability and influence to an amendment of the Australian Constitution, so that the conflicts which now arise between the States and the Commonwealth might be avoided.
– Order !
– In this country the right of private practice remains with an Attorney-General. I would not deny to him that right. I agree that the emoluments of the office of Attorney-General compare very unfavourably with the earning power of leading counsel. I suggested at the outset of my remarks, however, that that is irrelevant to the point which the House is considering. It is true also that in Great Britain salaries have been so fixed as to make it convenient for persons to abandon large incomes at the bar in order to accept the highly honorable position of chief law adviser of the nation, that of AttorneyGeneral. That, however, is by the way. My submission is that the AttorneyGeneral is bound, as the watchdog of the nation - as Lord Justice Bowen described him on one occasion - -to keep himself free from the possibility of entangling his private interests with his public duty.
– I need not repeat what the Minister for Health (Mr. Hughes) has said in commendation of the manner in which the honorable member for Bourke (Mr. Blackburn) has placed this matter before the House. We appreciate that fully. But I am somewhat afraid that in the welter of words there is a liability to forget the circumstances in which the decision was made to send the AttorneyGeneral (Mr. Menzies) to England to appear before the Privy Council. Very grave consideration was given to the matter, and some considerable time elapsed before the decision was finally made. The Attorney-General himself had no desire to make the trip. The Leader of the Opposition (Mr. Curtin) has suggested that he went to London in pursuance of his duties as Attorney-General. That is not correct. He could have remained in Australia and still have discharged those duties. It was his wish to remain in Australia. But from several quarters, including this House, the request was made that, in view of his high qualifications, he should be asked to represent Australia in this important matter. Not by those who have spoken, but by interjection to-day the innuendo has been, made that the AttorneyGeneral was influenced in some way by the honorarium which, it is suggested, he will receive from the Government of Victoria. Those who know the honorable gentleman will credit him with higher motives than that. His presence in thi3 Parliament is a demonstration of his preparedness to sacrifice himself financially for his country. That is true not only of the honorable gentleman but also of other honorable members on both sides of the chamber, including the mover of this motion; they are prepared to forgo a great deal in order that they may render service to their country. The AttorneyGeneral is an outstanding example of such personal sacrifice. I want the House to recognize that the decision to send him abroad was come to only after very careful consideration. It was first intended that, because of his presence in London in connexion with the case before the Privy Council, he might deal also with matters connected with the sugar industry, which were to come up for discussion. At a later stage, however, it was suggested that one who had grown up politically with that industry might handle the matter better, and it was decided to entrust the task to the Minister for Commerce (Dr. Earle Page). I discussed the matter very fully with the AttorneyGeneral, who expressed a definite desire to remain in Australia, and said that it would be possible to secure the services of some one who would be able to put the case for the Commonwealth before the’ Privy Council. The Minister for Commerce, however, stressed the fact that it was the duty of the Government to recognize the value and importance of a favorable decision, particularly to the primary producers. Consideration of that fact led to my finally agreeing that the Attorney-General should represent the Commonwealth.
– Order ! I am afraid that the Prime Minister has overlooked the precise terms of the motion. Whether the Attorney-General should or should not represent the Commonwealth before the Privy Council is not the question before the Chair.
– The honorable member for Bourke has attempted to show that there is something wrong in the acceptance by the Attorney-General of an honorarium from the Government of Victoria for services rendered to it, and has contended that no service will be rendered. I do not agree with that. There are other aspects than those affecting the merely legal and constitutional position; there is the big national aspect. It was because the Attorney-General possesses high qualifications for the statement of the viewpoint of both the Commonwealth and the States that the Government of Victoria requested that he should represent it as well as the Commonwealth. The decision that ho should represent the Commonwealth was influenced by that request. I submit, with all due respect, that the honorable member for Bourke has not proved his case; there is nothing wrong, nothing improper, in what has been done. The honorable member has referred to section 45 of the Constitution. The third paragraph of that section reads - directly or indirectly takes or agrees to take any fee or honorarium for services rendered to the Commonwealth-
The Attorney-General is not taking any fee or honorarium for services rendered to the Commonwealth - or for services rendered in the Parliament to any person or State.
He is rendering no service to the State in the Parliament; therefore, his action is in no way in conflict with that section of the Constitution.
– Indirectly, he is taking a fee.
– He is taking a fee, not indirectly, but directly from a State to which he is rendering a service.
– Is not that in the nature of an office of profit under the Crown ?
– As to whether it is right that the Government of Victoria should pay that honorarium, that, as other honorable members have already pointed out, is a matter for the Government and Parliament of Victoria, not for the Government and Parliament of the Commonwealth. This Government is paying no fee for the service which will be rendered to the Commonwealth. The Commonwealth Parliament and Government are in no way responsible for the decision of the Government of Victoria to pay an honorarium for services rendered to that State.
It is not necessary that I should deal with the point raised by the honorable member for Batman (Mr. Brennan) as to the possibility of conflict arising between the interests of the Commonwealth and the States, because the honorable member for Bourke has already shown clearly that there is no conflict, and that - in the words of the AttorneyGeneral himself - there is one case, and one case only. In that case, the interests of the State of Victoria are the interests of the Commonwealth of Australia. Surely the fact that the Attorney-General will represent not only the nation as a whole, but also one of the most important of the States, must strengthen his hands when he appears before the Privy Council.
– On that reasoning, if he also represented New South “Wales and Queensland, his position would be still stronger ?
– Probably it would. The honorable member for Bourke has failed to show any conflict with the Constitution, or improper conduct on the part of the Attorney-General in placing his valuable services at the disposal of the people of Victoria as well as the people of the Commonwealth generally.
Motion (by Mr. Gander) agreed to -
That the question be now put.
Original question put. The House divided. (Mr. Speaker - Hon. G. J. Bell.)
Majority . . 15
Original question so resolved in the negative.
The following papers were presented : -
Customs Act and Commerce (Trade Descriptions) Act - Regulations amended - Statutory Rules 1936, No. 14.
Dairy Produce Export Control Act - Regulations - Statutory Rules 1936. No.19.
Dried Fruits Export Charges Act - Regulations amended - Statutory Rules l936. No. 29.
Meat Export Charges Act - Regulations - Statutory Rules1936 No. 23.
Meat Export Control Act - Regulations - Statutory Rules 1930, No. 31.
Norfolk Island Act -
Ordinances of 1936 -
No. 3- Audit.
No. 4 - Crimes.
No.5 - Stock Diseases.
No.6- Public Works.
No. 7 - Pasturage and Enclosure.
No. 8 - Public Roads and Public Notices.
No. 9 - Noxious Weeds.
No. 10 - Slaughtering.
No. 11. - Commons and Public Reserves.
Exportation of Fruit Ordinance - Regulations (Banana).
Public Service Act - Appointments of W. T. Agar,D. W. Johnson and J. L. O’Connor, Department of Health.
Wheat Bounty Act - Regulations amended - Statutory Rules 1936, No. 3.
Motion (by Mr. Hughes) agreed to -
Thathe have leave to bring in a bill for an act to amend the Commonwealth Railways Act 1917-1925.
Motion (by Mr. Hughes) agreed to- -
That he have leave to bring in a bill for an act to amend the Arbitration (Public. Service) Act 1920-1934.
In Committee of Ways and Means: Consideration ‘resumed from the 27th March, (vide page 680), on motion by Mr. White (vide page 2044, volume 147)-
That the schedule to the Customs Tariffs 1933- -
And on further motion by Mr. White (vide page 441) -
That the schedule to the Customs Tariffs 1933 … be further amended as hereunder set out . . .
By omitting the whole of sub-item (c) and inserting in its stead the following sub-item: - “(c) Sanitary and lavatory articles of earthenware, including glazed or enamelled fireclay manufactures - ad valorem, British, 15 per cent.; intermediate, 40 per cent.; general, 50 per cent.
And in respect of sub-item (c) -
For each£1 by which the equivalent in Australian currency of £100 sterling is less than £125 at the date of exportation -
An additional duty of - ad valorem., British, . 8 per cent. ; intermediate, 8 per cent.; general, . 8 per cent.”.
.- I hope that the committee will not accept the recommendation of the Tariff Board regarding this item. Particular notice should be taken of the interests represented before the board at its inquiry. No appearance was made on behalf of the master builders’ organization, the representation being confined to the importing interests, which desire to break clown the tariff barrier. Practically every overseas manufacturer was represented, and a gentleman appeared on behalf of even the Graziers’ Association of New South Wales, the Farmers’ and Settlers’ Association of New South Wales and the Fruit-growers Federation. Why these bodies should concern themselves about sanitary and lavatory articles, I am at a loss to know, unless they are personally or financially interested in having these duties lowered. They appear to have intruded in a matter that does not concern them. If exorbitant charges were made by the local manufacturers, the master builders would be directly affected, and, no doubt, they would have been represented at the inquiry, because a considerable outlay is involved in their purchases of these goods, and exorbitant prices would retard building operations. The manufacture of sanitary ware is one of the oldest industries in the Commonwealth. In 1933-34, there were 65 factories, and the 1,656 employees drew salaries and wages amounting to £285,000. The material used in the industry was valued at £136,000, and 98 per cent, of it was of local origin. The output was worth £502,000. The development of the industry has been rapid in recent years. In point of workmanship and design, the Australian product has measured up to the most exacting requirements of modern building construction. Recent contracts fulfilled by a leading Australian manufacturer for one of the metropolitan hospitals drew a well-deserved tribute from the firm of Melbourne architects, Messrs.
Stevenson and Meldrum, who are personally acquainted, by recent contacts, with the high standards obtaining in the building trade overseas. This firm has been responsible for drawing-up the plans, not only of the ‘ St. Vincent’s Hospital, but also of various private hospitals. I propose to read to the committee a letter which its principals wrote to an Australian manufacturer, and I am confident that honorable members will agree that, in connexion with materials of this description, nothing but those of the very highest standard will suit the architects. It was addressed to Messrs. R. Fowler Limited, Thomastown, dated the 30th May, 1934-
We arc pleased to express our appreciation of the fireclay equipment you have provided for St. Vincent’s and other private hospitals recently constructed under our supervision.
It is a great satisfaction to all concerned that you are perfecting this equipment to such a high standard, which is comparable to fireclay equipment manufactured in other parts of the world.
The industry has not only improved its output and expanded to the advantage of those employed in it, but also competent architects who are carrying out very specialized work, have added their commendation of what it has done to advance its production.
In 1930, those controlling the industry feared that owing to the depression and the consequent general slackness of the building trade, the industry would collapse. As a result, the government of the day placed an embargo upon overseas goods of the nature of those manufactured by this firm on the condition that the price to the public would not be raised. I defy contradiction of the statement that the prices were not raised to the public, despite the fact that the firms concerned carried on their operations, as I shall proceed to show, at a loss. One of the largest firms in the industry recorded substantial losses because it refused to break its promise to the government when the embargo was placed on imported goods. It might he argued by honorable members supporting the Government that while these enterprises did not increase the prices of their articles to the public, they did not lower them.
That is true, because during the slump in trade occasioned by the depression, overhead charges were not reduced. As the result of the slackness in trade and the continuance of overhead charges, they found it impossible to reduce the cost of production. Honorable members should realise that this industry when given the advantage of a complete embargo on imported goods of the nature that it manufactured, entered into an agreement with the government not to increase the price of its products.
Alarm is now expressed throughout the industry at the exceptional rise of imports that has occurred since the reduced duty became operative in 1934. Following the inquiry by the Tariff Board in August of that year and its subsequent recommendations, the duty on sanitary and lavatory earthenware was reduced from 35 per cent. British, in the case of articles the value of which did not exceed 20s., and 25 per cent. British in the case of articles, the value for duty of which exceeded £1, less 25 per cent, exchange adjustment, to 15 per cent. British, while a reduction was also made in the general tariff. Imports from the United Kingdom into New South “Wales and Victoria of sanitary and lavatory earthenware increased by nearly 100 per cent, in twelve months. For the year ending the 31st Decern her, 1934, the value of imports of this type was £12,055 ; in the corresponding period in 1935, the value was £23,155, an increase of £11,100 or approximately 92 per cent, on the importations for 1934. As a result of the competition from overseas, the sales of New South “Wale3 manufactures of this class has fallen in other States. Exports from Sydney to South Australia declined by 12f per cent., and those to Western Australia declined by 39$ per cent., due to the influx of these articles from overseas.
– I shall deal with that aspect a little later. That the industry’s alarm at its future prospects if the present tariff proposals are given legislative sanction was well grounded is shown by the meagre share that it has enjoyed of the increased sales resulting from the revival experienced in the building trade. Building permits issued in
Sydney and Melbourne during 1935 represented a value of £15,500,000, an increase of 46 per cent, on the figures for 1934; yet the sales of one of the leading Australian earthenware companies, in the best position to participate in any improvement, showed an increase of only 22 per cent. Even worse was the experience of a Victorian factory, whose sales in 1935 were 3 per cent, lower than those of the previous year, despite an increase by 37 per cent, of the building permits issued in Victoria in the period under review. The figures disclose that since the reduction of the duty, practically all the benefit of the revival of the building trade in Australia is going to overseas manufacturers.
The early years of the depression dealt a severe blow to the building and related trades, and the earthenware industry suffered proportionately; so much so that but for the imposition of the embargo in 1930, it is doubtful whether it would have survived. The lifting of the embargo in 1932 saw a prompt resumption of importing activities, and the manufacturers of the United Kingdom set about recapturing this market by reducing prices by an amount equal to the exchange payable by the Australian importer on his goods. Evidence of this was found in the fact that since October, 1932, the price of an ordinary W.C. pan f.o.b., United Kngdom ports, has been reduced from 13s. 9d. to 10s. 3d., despite the increases of practically all expenses since that year. Thus by reducing profits to a minimum, and even incurring a loss on certain lines, the manufacturer of the United Kingdom is picking out the popular lines for his attack on the Australian market, and leaving the local manufacturer with only the less popular lines to exploit. Many instances could be quoted of an article made in the United Kingdom, but not produced locally, being sold at a reasonable price until it meets with competition from an Australian factory, whereupon theUnited Kingdom f.o.b. price is reduced to a level at which the Australian industry cannot produce at a profit. So great, has been the drift in this direction that the average decreases in various classifications since 1920, quoted by manufacturers at an inquiry by the Tariff Board in 1934 were - Sanitary pedestal pans, 12½ per cent. ; sanitary lavatory basins, 15 per cent.
In order to impress upon honorable members the importance of the effect of this influx of imports, I quote a letter from A. Bond Barker and Company, Perth, the distributing agent in Western Australia for Messrs. B. Fowler Limited -
Messrs. R. Fowler Limited,
We have your letter of the 18thinst. together with bill of lading for twelve only Fitzroy pans for consignment stock. Please do not send us any more pans unless we order them, as we will probably have to hold them in stock for some time. The reason the demand for our pans have been so small of late is on account of the price. For your information, the English pans can be landed into our store, tested, at 22s.6d. each, and the merchants are selling the pans at 30s. each. The price we have to charge for your pans is “ Fitzroy “ 27s.9d., and “Dulwich” 29s.6d. The merchants can only get 30s. for our pans, and it is not likely they will buy them whilst imported pans can be bought at such a difference in price.
That letter furnishes an indication of what is happening as a result of the reduction of the tariff barrier. Although the English manufacturers are insistent in their demand for lower duties on the goods entering Australia, the United Kingdom tariff affords them a greater measure of protection against imports into Britain than the Australian tariff gives to manufacturers in the Commonwealth against imports of British goods. The British manufacturers enjoy a tariff in the United Kingdom of 30 per cent., whereas the Australian manufacturers are given protection of only 15 per cent, against imports from the United Kingdom. It is of interest to note that, the manufacturers of the United Kingdom have expressed themselves as being dissatisfied with the protection of 30 per cent, at present afforded them by the Government of the United Kingdom, and have requested an imposition of a duty of 50 per cent, on goods entering the United Kingdom. In short, while demanding protection amounting to 50 per cent, for himself, the British manufacturer protests against a protective duty of 35 per cent. for the Australian industry; the Australian Tariff Board supports that protest, and proposes that the duty be reduced to 15 per cent.
– Plus exchange, of course.
– We dealt with the exchange position recently; it is therefore quite unnecessary for me to reiterate the arguments. It suffices now for me to say that the Australian manufacturer does not derive from the exchange rate protection equivalent to 25 per cent.
While the Tariff Board looks very minutely into the business of the Australian manufacturer, it does not appear to take into consideration the affairs of the British manufacturer. If it did, some interesting comparisons could be made. For instance, in Australia, 93 per cent, of the persons engaged in this industry are males; in England, only 55 per cent, are males. In regard to wage standards, the average rate of pay over the whole industry in Australia is £3 a week; in England it is 35s. a week. While the Tariff Board has been carefully analysing the financial affairs of these Australian businesses, let me indicate the experience of one of the largest manufacturers of this line of goods in Australia; I refer to R. Fowler Limited, which once enjoyed a complete embargo on the importation of competitive goods from overseas. In 1931, it recorded a loss of £22,000. I draw attention to the fact that no exploitation of the public took place, and no exorbitant profits for the shareholders were made. Even with the advantage of a prohibitive tariff, this enterprise lost £22,000.
– The manufacturers destroyed the market.
– What an absurd argument for the honorable member to put forward ! The Australian manufacturers were the only ones operating in the market. Everybody who desired to build in 1931 was obliged to purchase his requirements in this line from an Australian manufacturer. Despite that fact however, this firm showed a loss of £22,000, because it kept its pledge to the Government that it would not increase the price of its articles when the embargo was imposed. In 1932, with the embargo still in operation for portion of the time, the enterprise lost £12,000. Last year, it made a profit of 5.2 per cent. I have been inquiring into the affairs of an overseas company, which is one of the most active competitors on the Australian market. I refer to Twyford andCompany, an English firm, which is prominent in this trade. For the year ended the 31st March, 1935, it made a profit of £62,000- £11,000 more than in the corresponding period of the previous year. It paid a dividend of 10 per cent, and carried forward £21,000 to reserve. Here is a firm, which is not only exploiting the British public, but also is in such a sound financial position that it can dump goods into Western Australia cheaper than can the manufacturers of New South Wales. The firm of Twyford and Company is selling these goods in Western Australia for 22s. 6d., while the manufacturers in New South Wales cannot land them there for less than 30s. The English firm is able to do this because only 55 per cent, of its employees are males, as against 93 per cent, of males employed by. the Australian industry. The English firm pays an average wage over the whole industry of 35s., whereas the Australian manufacturers pay an average wage of £3. The firm of Twyford and Company is making exorbitant profits out of its operations in Great Britain under a protective tariff of over 30 per cent., but it is clamouring to have the duty raised to 50 per cent. Nevertheless, this firm, which made £12,000 more in 1934 than in 1935, which is able to pay a dividend of 10 per cent., and place £21,000 to reserve, has sent its representatives before the Australian Tariff Board to ask that the Australian duties be reduced from 30 per cent, to 15 per cent. Do members of the committee think that that is fair and reasonable competition? The freetraders in the House will, do doubt, say that we can apply anti-dumping measures, but how is it to be determined whether a firm is dumping or not, unless we are able to ascertain its costs of production ? The Tariff Board, however, never seeks to obtain this information in respect of overseas firms, but it prys into every detail of
Australian industry to see where it can justify paring down the duty a little more.
– It is unfair to Aus tralian industry.
– Of course it is. I have quoted those figures in order to show what a different complexion is placed upon the Tariff Board’s report when all the relevant facts are brought to light. The disadvantage under which the local industry is placed, as compared with oversea competitors, is illustrated by the fact that it must pay interstate freights, which are heavy by reason of the nature of the article, while the overseas product can be landed in the various Australian capitals at uniform rates. Imports from Japan, though so far not large in volume, have increased to such an extent as to indicate the nature of the threat to local employment which may result from imports from this source.
– Only very small quantities have been imported from Japan.
– That is so, but the importations up to date represent only the thin end of the wedge. This Government sent a Minister to Japan on a Goodwill Mission, the only result of which so far seems to have been that the protection previously enjoyed by Australian industry has been bartered away. No matter what duty is placed on Japanese goods, they will enter the country just the same. Japanese imports, which, prior to June, 1935, were negligible, have since been arriving in Australia in large quantities, and show a tendency to increase. Shipments of earthenware to the value of £500 have recently arrived in Sydney and Melbourne. These will displace at least £1,500 worth of Australian products. Continued imports from Japan at the present rate will seriously affect both the Australian industry and British trade with Australia. Wages in the higher sections of the pottery industry in Japan were quoted in the August issue of The Ceramic Age at 45 cents a day of ten hours, or 2s. in Australian currency. Competition against wages of that kind is commercially impossible.
It is also commercially impossible for the Australian industry to carry on under the terms which the Tariff Board proposes. The committee cannot, in justice to the Australian industry, arrive at a just decision unless the Tariff Board, when, submitting its recommendations, submits also all the available evidence, whether from Australian or overseas sources. While there is such a disparity between the proportions of male employees in the British and Australian industries, there can be no effective competition. The English manufacturers are prepared, for the time being, to sell their goods in Australia at a loss so long as they can get into the market, and while this condition of affairs persists, the committee will be justified in refusing to be guided by the recommendations of the Tariff Board. I am convinced that the Minister will not be able to show that the Australian industry has departed from the undertaking given in 1930 that if an embargo were imposed upon imports, it would not raise the price of its product.
– It has kept the price at. the 1929 level, which is too high.
– The committee would be doing only bare justice to the Australian industry if it rejected the proposal of the Tariff Board. As for the honorable member for Riverina (Mr. Nock), I have only this to say to him; while he is in favour of dear bread, dear meat, dear flour, and high prices for everything else he produces, he is, at any rate, in favour of cheap knives and forks with which to eat these commodities.
– It is seldom that I speak in opposition to low duties, but on this occasion I feel that the honorable member for Watson (Mr. Jennings) and the honorable member for Dalley (Mr. Rosevear) have put forward an almost unanswerable case for the industry concerned. I do not intend to vote against, the item, but I appeal to the Minister to refer it back to the Tariff Board for further consideration. If the facts are as set out by the two honorable members who have spoken,” I feel sure that the next report of the board will be more generous to the industry. The honorable member for Watson made one point that must have appealed to every one, namely, that this industry suffered very severely during the depression, because its output was used chiefly in the building trade, which was, perhaps, harder hit than any other. The fact that the earthenware firms concerned made no profit during the last seven years is, therefore, not surprising. I was also impressed by the point mentioned by the honorable member for Dalley, that the Australian industry uses 9S per cent, of Australian raw material, and that 70 per cent, of the cost of production goes in wages to employees, 93 per cent, of whom are male3. At this time, when we are just rising out of the depression, it is essential that a maximum of employment should be found for males. Following out the argument of the honorable member for Dalley regarding duties, I find, according to the report of the Tariff Board, that the rates of duty now in force are the lowest since 1901. This industry, which has just managed to carry on up to the present, is now faced with greatly reduced tariff protection.
– It is not greatly reduced.
– A reduction from 35 per cent, to 15 per cent, seems to me to be fairly substantial, having regard to the fact that the industry is just recovering from the effects of the depression. I was also interested to hear that the English manufacturers were seeking to have the protective duty in England raised from 30 per cent, to 50 petcent., possibly as a protection against the competition of continental manufacturers. If the British industry feels that it must be protected against foreign competition, how much more necessary is it that the Australian industry should be protected against Asiatic penetration? I am not impressed by the figures quoted regarding Japanese importations unless they can be substantiated by bills of lading, invoices, &c. The Minister could help bv insisting that all goods imported should be stamped with the name of the country of origin.
.- The Government is well aware of the importance and efficiency of this industry. I have seen the factory referred to by the honorable member for Dalley (Mr. Rosevear), and also the Victorian branch factory. Many people are acquainted with the excellence of the goods which these fac tories produce. There are eight. Australian manufacturers of sanitary earthenware, and four manufacturers of fire-clay ware. One would have thought, from listening to the. speeches of honorable members, that the reduction of duties has been substantial, but the reverse is the case. It is only 11-J per cent, on British articles valued under 20s., and 10 per cent, on foreign articles. Those are the net rates. On British articles valued over 20s., the reduction is only Z% per cent., whilst no reduction has been made on foreign articles which still bear a duty of 50 per cent. I have already informed honora’ble members that the value of these goods imported from Japan during the last twelve months was only £72. When I explained by interjection to the honorable member for West Sydney (Mr. Beasley) that the exchange rate allowance had to be taken into consideration1, I was referring to the old duties. Those printed in the Tariff Schedule were not so high as they seemed, for they were subject to deductions in respect of exchange of onequarter of the duty or one-eighth of the value of the goods for duty. When the new rates are subtracted from the old net rates the reduction of the British preferential duty works out at Hi per cent, on goods valued under 20s. and 3f per cent, on goods valued over 20s. The duties against foreign countries are practically unchanged. The duty provided here gives the Australian manufacturer greater protection than is given United Kingdom manufacturers against foreign competitors in the British market. The board found that 90 per cent, of these articles were made in Australia. Thus local manufacturers were holding their own. Furthermore 50 per cent, of these importations are of a type not made in Australia ; they include coloured earthenware and the more expensive products which people will buy irrespective of the effect of the duty on the price. In addition to these duties, primage has to be taken into account, whilst exchange also is undoubtedly a factor. The Tariff Board recognizes that and has prescribed a formula by which, as Australian currency moves towards sterling, the protection to the local manufacturer will increase correspondingly.
There is no dumping inWestern Australia as the honorable member for Dalley (Mr. Rosevear) has alleged; a factory is producing these articles in that State. The Tariff Board takes into account overseas costs of production. For this purpose it has access to Customs documents. Duties are assessed not on the invoice price only, but also on the f.o.b. price, or the domestic price in the country of origin, whichever is the higher.
– On whose word does the department rely for information regarding overseas prices?
Mr.WHITE.- The Customs Department has special officers in England to ascertain the movements of prices in the United Kingdom, and thus it is able to check the prices shown on invoices. Surely honorable members opposite do not suggest that British manufacturers will continue for months selling below cost in the British market merely in order to beat the Australian manufacturer in his home market.
– Such tactics have been adopted by the oil companies, in order to defeat competitors, and they could be adopted by others.
– That practice has not been entirely unknown. The Tariff Board points out that the Australian manufacturers of these particular articles have kept their prices unnecessarily high ; they are still at the 1929 level. The prices of most other goods have fallen since that year. At present the building industry is expanding and if these manufacturers are not getting an adequate share of the market, the only explanation for their failure is that their prices are too high.
– Their prices are accounted for by the slackness of the building trade during the depression, and the fact that previous overhead charges remained.
– They are not due to any decline of the building trade. In February, the total value of buildings erected in Melbourne was eight times greater than for the corresponding month in the previous year. The honorable member probably does not know that these manufacturers get together and arrange their prices. There shouldbe a certain amount of internal competition, and if, to-day, the manufacturers do not get all the business they should, they have largely themselves to blame. The Tariff Board said that the prices of these Australian goodswere as high as 220 per cent, above the f.o.b price of English goods of similar manufacture. That fact should give honorable members, who are championing these particular firms, something to think about.
I have something to add which I think will please honorable members opposite. About three years ago I found that inroads were being made into the trade of certain potteries in Australia, and I had the commerce regulations altered to require that all imported goods of that particular kind be marked to show the country of origin. The new regulation was applied irrespective of the country from which the goods came; it was not directed against any country in particular. I have the assurance of the industry as a whole, and the firm mentioned ‘by the honorable member for Dalley, that the trade has greatly improved as a result of this action.
– Was the mark of the country of origin placed prominently on the article?
– Yes. The new regulation not only assisted the Australian industry, but it also helped the British manufacturer to compete on the Australian market against certain foreign manufacturers. Early this year representations were made to me by the industry that I should apply a similar regulation to lavatory and sanitary ware, and some three weeks ago I announced that that would be done. This practice appeals to the patriotic sentiment of Australian buyers, as they prefer goods of Australian or British manufacture. The new regulation will greatly assist this trade. The announcement of such a change has to be made about six months in advance of its application so that existing stocks may be disposed of before it becomes effective. Last year the industry complained of competition from overseas against which, it contended, it could not hold its own. I instructed the department to make inquiries on this point. The Victorian Chamber of Manufactures was asked to give details on this matter, but nothing further was heard from this body until about a week or so ago, when the industry made its protest. However, just in case there may be something in the charges that foreign goods are penetrating the market, and that local manufacturers are not getting a fair share of the Australian market, I have referred this item back to the Tariff Board. I ask that the present duties, which are fair and reasonable, be accepted for the time being, and I assure honorable members that if the Tariff Board makes any other recommendation it will be dealt with in due course.
.- This item concerns a great natural industry. I am not satisfied with the Minister’s statement that he has referred it again to the Tariff Board. Other items have been referred back to the Tariff Board, but no benefit resulted from that course.
– We should suspendthe application of these duties.
– We cannot do that.
– If the application of these duties were suspended in the meantime, then we would not mind the matter being referred back to the Tariff Board, and held up for, say, three or four months. But a reference back to the Tariff Board, while the new duties continue in operation, is merely a way of shelving the matter. It is similar to this Government’s practice of appointing commissions to inquire into certain matters with the sole immediate object of deferring action for six months or so. I move -
That the itembe postponed.
That will be “an indication to the Government that the rates be 25 per cent. British, 50 per cent, intermediate, and 60 per cent, general, in lieu of the proposed reductions to 15 per cent. British, 40 per cent, intermediate, and 50 per cent, general tariff, provided in this schedule “. Reviewing the protection given to this industry since federation, I find that in 1902 it was 20 per cent., plus a fixed rate which brought the total to 35 per cent.; in 1907, 30 per cent.; in 1908-11-14, 20 per cent. British, 25 per cent, general; and in 1921, 25 per cent, and 50 per cent. The new duty proposed in this schedule is 15 per cent, less than that provided in the 1908-11 tariff. The Minister referred to the effect of exchange on duties, but as that is only a temporary measure, I do not think it should be taken into consideration in connexion with a permanent tariff policy. The protection proposed by the Government in this schedule is less than the rate of protection given to this industry 34 years ago. Will any one defend that? It is explicable only by the fact that half of the portfolios in this Government are held by members of the Country party, which advocates a low tariff. I find that from the 12th December, 1929, to the 25th February, 1932, inclusive, the rates of duty were 35 per cent. British, and 60 per cent, general. From April, 1930, to October, 1932, there was a total prohibition imposed by the Scullin Government on the importations of earthenware sanitary and lavatory articles, and it was that prohibition which put this industry on its feet because it stopped the huge imports which resulted from the substantial drop of overseas price levels and the tariff which had existed during the previous seven or eight years under the Bruce-Page Government. This industry is not of recent growth ; it has passed through many vicissitudes since its establishment 146 years ago.
– There was no tariff then.
-It may have been because of that fact that the industry did not flourish. From the 26th February, 1932, to the 28th November, 1935, the duty on articles of a value not exceeding 20s. was 35 per cent. British, and 60 per cent, general, and on articles of a value exceeding 20s., 25 per cent, and 50 per cent, respectively. I submit that a duty of 15 per cent. British, and 50 per cent, general, proposed in this schedule, is totally inadequate. The reduction of the British preferential tariff from 35 per cent, to 15 per cent, has been too abrupt. If the Government were to bring about reductions gradually it would enable the industry to. accustom itself to the changed conditions, but an abrupt change like this must dislocate conditions in the industry, and seriously affect employment. The value of imports covered by this item dropped from £44,000 in1928-29 to £411 under the total prohibition imposed by the Scullin Government in 1.931-32. Can any one gainsay the fact that that prohibition was of tremendous assistance to this industry in tiding it over the depression? lt secured for the industry the whole of the Australian market. The ad valorem rates of 15 per cent., 40 per cent, and 50 per cent, are only nominal, because they are reduced by onequarter in accordance with the exchange adjustment provisions of the tariff. the rates of duty on pottery-ware imported into Great Britain are: (a) Drain-pipes, angles, bends, elbows, and traps, 20 per cent.; and (6) other sanitary ware, 30 per cent.; articles other, and of a description commonly used for domestic purposes, £1 5s. per cwt. The duty of 30 per cent, enjoyed by the British manufacturers against foreign imports - the only imports that trouble them - is double that which the Tariff Board considers adequate protection for the Australian manufacturers. British manufacturers, who contend that a duty of 30 per cent, is inadequate to protect them from foreign competition, suggest that a duty of 15 per cent, should be sufficient for Austraiian manufacturers. In Canada the rate is 20 per cent. Mr. Ferguson, a director of the Australian Association of British Manufacturers, in presenting evidence on behalf of certain British manufacturers before the Tariff Board a few months ago, said -
At one time the bulk of the sanitary earthenware used in Australia, consisting oi lavatories, water closet bowls, cisterns, and the like, was supplied by British makers, the remainder being of Australian manufacture. Since June, 1927, there has been a continuous decline in the Australian imports of sanitary ware which, between April, 1930, and October, 1932, were negligible in quantity, owing to the embargo. Under Article 10 of the Ottawa agreement between Groat Britain and Australia, the protective duties imposed in Australia were not to exceed such a level as would give the United Kingdom producers full opportunity of reasonable competition, based on relative cost of economic and efficient production, and under article 1 1 the Tariff Board was to review the existing protective! duties in accordance with the above principles.
The argument adduced by Mr. Ferguson was that under the Ottawa agreement the duty should be reduced to 15 per cent., and the Tariff Board acceded to the request. The duties in existence prior to this reduction being made were reached by agreement between the Australian manufacturers, the representatives of the British manufacturers, and the Tariff Board. Immediately the embargo was lifted, British manufacturers reduced the prices of key lines by an amount equivalent to the exchange on London. This reduction was not altered,, even when the exchange adjustment operated, and the duty has now been reduced from 26^ per cent., effective tariff, to 15 per cent. It is not now a. matter of the British manufacturer being provided with a reasonable opportunity to trade, but the Australian manufacturer is being denied that right. Australian potters have been unable to reduce prices below their present low rate, and the loss of their interstate trade, where the difference in landing costs is approximately 25 per cent., is causing grave concern. When shipping charges are allocated in proportion to invoice value, the highest priced articles bear a good deal of the cost of those forced down by British manufacturers to a low level. However, as the landed price of British articles is so low, for the better class goods, merchants have given the whole of their orders overseas. All sanitary and lavatory articles could and should be made in Australia, as they were between 1930 and 1932, when there was a total embargo on imports. The earthenware industry, which is one of the oldest manufacturing industries in Australia, has at times employed directly 1,700 persons. The number directly employed in the industry is now about 1,500, and at least 6,000 persons are directly and indirectly employed. Moreover, 9S per cent, of the materials used are obtained in Australia. The wages paid represent 70.57 per cent, of production costs. Australian manufacturers who are using Australian plant should he given a reasonable opportunity to supply the whole of Australia’s requirements, particularly when there are thousands of workers walking the streets looking for jobs. It is interesting to note that the percentage of males engaged in Australian industry is 93, as against 55 in the British industry. The weekly wage paid to male employees in Great Britain is 49s. 5d., and to females it is 22s. 3d., or an average of 35s. per week, while the average paid to those engaged in the Australian industry is about double that amount. When the duty on sanitaryware was reduced in December, 1934, the imports more than doubled. In1 934, before the duty was reduced, the building permits issued in Sydney and suburbs totalled £5,600,000, and in 1935, when the duty had been reduced, they totalled £8,953,000, or an increase of 58 per cent. In 1934, imports were valued at £8,000. In 1935, they were valued at £17,000, an increase of 111 per cent. Obviously overseas manufacturers obtained the major portion of the increased business which followed the increased number of building permits. Australian manufacturers are able to supply the whole of the Australian demand, and, in doing so, employ Australian workmen. The Government must take the responsibility.
– Where are these workless persons ?
– They are lining up for the dole in different parts of New South Wales.
Sitting suspended from 6.15 to8 p.m. [ Quorum formed.]
– I am not satisfied with the assurance of the Minister that he will refer this subject back to the Tariff Board for further inquiry, for I do not think that the board is likely to alter its previous recommendation, as the members of it are only human. The promise to refer the item back to the board has been given by the Minister merely to extricate himself from a difficult position. He fears that some ‘of his own supporters will vote against the Government in order to ensure that this industry is afforded adequate protection. Even if my amendment is agreed to, and the duties which I advocate are applied to the industry, the degree of protection will still be lower than that accorded to the industry 35 years ago. It surely cannot be said that the 25 per cent. I have proposed is an unfair measure of protection. The British industry is at present operating under a protection of 30 per cent, against foreign imports, while the Canadian industry is protected to the extent of 20 per cent., although Canada is by no means a high-protection country. The Labour party is prepared to reserve the whole of the local market for the Australian industry. We have in this country the plant, the men, and the material to supply all our own needs. During the period of the total prohibition of imports of these goods, the Australian manufacturers supplied all our needs without inconveniencing the trade. The rate of wages paid in the industry in Australia is twice as high as that paid by British manufacturers, and we should remember that only 55 per cent, of the labour employed in the industry in Great Britain is male labour, while in Australia 90 per cent, is male labour. Comparing 1934 with 1935, there was an increase of 58.13 per cent, in the value of the building permits granted in Sydney and suburbs, whereas the increase in the value of the imports of sanitary and lavatory requirements was 111.36 per cent, compared with an increase of only 19 per cent, in the volume of employment in Sydney potteries. Obviously the overseas manufacturers are obtaining the greatest proportion of the increased business following upon the revival in building operations. In effect, employment is being given in potteries overseas to provide the requirements of Australia, while we have in this country hundreds upon hundreds of pottery employees walking the streets of our cities looking for work.
– What nonsense! Name the cities.
– In considering the figures which I have mentioned, it must be remembered that no account is taken of transport, landing and clearing charges, which represent more than 100 per cent, of the value for duty. Therefore, the imports into New South Wales, in 1935, would have an Australian value of £34,000. To produce goods to this value in Australia, wages totalling approximately £17,500 would have to be paid. These figures are based on the percentage of wages to the value of the output of the earthenware, china, porcelain and terra cotta industries, which in 1933-34 was 51.46, according to Australian Production Statistics, No. 28, at page 101. The expenditure of this amount of money would provide employ- ment in New South “Wales alone for nearly 100 Australians for twelve months, and this is in respect of only one tariff item, which does not include such items as tiles, fireclay, crockery, and earthenware, the imports of which were valued at more than £500,000 in the year ended December, 1935. All the articles covered by these items could be made in Australia by Australians. This is shown by the fact that in 1931-32, during the period of the embargo on the importation of sanitary and lavatory earthenware, the Australian workers produced practically all the requirements of the local market. There was no justification whatever for the departure from the measure of protection granted at that time.
The Tariff Board acknowledged on page 7 of its report on sanitary and lavatory articles of earthenware that a protection of 15 per cent, was inadequate, as indicated by the following paragraph : -
Tim Tariff Hoard realizes that a rate of 15 per cent. (British preferential tariff) under present conditions will not enable local manufacturers to compote with overseas goods in all lines at the prices they are at present charging. Nevertheless, in view of the fact, that in many other lines the Australian factory selling-price is less than the present landed duty-free cost of similar imported goods, the board is of the opinion that the rates of duty found by it to bc reasonable should adequately protect all lines the production of which in the Commonwealth is economic.
Who is to judge whether an -industry is economic or not? Certain honorable gentlemen opposite, who favour low tariffs, consider any industry uneconomic when they wish a duty to be reduced, but when they desire to secure a degree of geographic protection for some other industry it is, of course, economic.
The improved position of the building trade of Australia should have brought about a substantial increase of numbers in respect of persons employed in this industry in Australia, but the increase has not been by any means commensurate with the generally improved activity in the building trade. Our imports of these goods from England were valued at £13,307 in 1933-34, and at £21,552 in 1934-35. This indicates clearly that a very much larger quantity of these goods was required, but there was no proportionate increase of numbers in respect of persons employed in the local fac- tories. The business went abroad. I trust that honorable members will not be fooled by the Minister’s promise to refer this subject back to the Tariff Board for further inquiry, for the board is not likely to reverse its previous decision.
– If the Government would agree to revert to the previous duty, it would be all right.
– That is not likely to happen.
– It is an appeal from Caesar to Caesar
– That is so. I trust that if honorable members will not support my amendment they will, at least, reject the proposal of the Government as outlined in the item under consideration. This would mean that the duties previously in operation would apply. I hope that we shall take the course in connexion with this item, that we took in connexion with cement.
.- The Deputy Leader of the Opposition (Mr. Forde) has quoted some extraordinary and extravagant figures regarding the amount of employment provided by this industry. He referred to thousands of employees, and said that hundreds upon hundreds of men were walking the streets.
– I was referring to the amount of employment provided in the manufacture of sanitary and lavatory articles of earthenware throughout the Commonwealth.
– The honorable member’s figures remind me of the buckram knaves of Falstaff - they grow with the telling. In the same way as we were told a few years ago that every tariff schedule introduced by the honorable member, when he was Minister for Trade and Customs, meant the provision of employment for thousands of additional people - although the number of unemployed was growing all the time - we are now asked to believe that the schedules introduced by this Government are decreasing the amount of employment available, although the fact is that the amount of employment available is increasing all the time. The officers of my department have compiled some figures which show that the number of employees in the industry covered by the item now under discussion is as follows : -
– Those figures relate to only one branch of the industry.
– The honorable member has been dealing, not only with this specialized industry, but with other allied branches of the pottery industry as well. It will be noticed that the figures I have just cited indicate that a steady increase of employment has occurred in this industry. The value of the articles covered by this item manufactured in Australia in 1930-31, and sold interstate, was£ 32,984. Since that time steady progress has been made, and for the eight months of the present financial year the value of this trade was at the rate of £110,114 per annum, which is £4,000 in excess of the total value for the whole of the preceding year. I felt obliged to direct attention to these figures, because the Deputy Leader of the Opposition has endeavoured to show that the policy of the Government has occasioned injury to this industry, whereas it has, in fact, promoted its prosperity. I have already said that, in view of the statements that importations of goods of this class have increased lately, the Government is willing to refer the subject back to the Tariff Board for further inquiry. The details upon which honorable members opposite have relied appear in a memorandum which has been widely circulated. I point out, however, that the increase of importations is due to the purchase of goods of a class not made in Australia, but which people will have, irrespective of the rate of duty. Unquestionably, the duties provided in the schedule are adequate to protect the industry reasonably. Although the Government is prepared to request the Tariff Board to make a further investigation of the subject, it is not willing to postpone consideration of the item.
.- I do not know the source from which the Minister for Trade and Customs (Mr.
White) obtained the figures which he has just placed before the committee-
– I obtained them by telegram.
– I direct the attention of the committee to the following accurate information on the subject : -
These figures cover the pottery industry, and include those working in china, porcelain, and terra cotta.
– Those branches of the industry are not affected by this item.
– The facts I have placed before the committee prove that the figures given by the Minister are ridiculous. The Minister has said that he will refer the item back to the Tariff Board, and, if he does so, the board will again have to eat its own words. It is Caesar appealing to Cæsar.
I am surprised that a Minister of an Australian parliament should be more considerate to the British workers than he is to the Australian workers.
– What nonsense !
– The British duty on the importation of earthenware articles from foreign countries is 30 per cent.
– The corresponding Australian duty is 50 per cent.
– The British manufacturers are now seeking a duty of 50 per cent, against foreign countries, but the same people demand that their goods he allowed free entry into this country. They will not allow us to protect our own workers in our own industries. We do not hear of a British Minister decrying British industries and British workmen, but we do hear our Minister for Trade . and Customs decrying Australian industries.
– Mr. Chairman, that is a complete distortion of anything I said.
The CHAIRMAN (Mr. Prowse).Order! There is no point of order, but I ask the honorable member for Cook (Mr. Garden) to confine his remarks to the item.
– The Tariff Board’s report speaks of wages in the industry. The wages in the British earthenware
industry are 35s. a week; tlie average wage in the Australian industry is £3 a week. Apparently, the Minister wants wages in Australia to be reduced so that Australia can compete with low-wage countries. If he had his way, we should have to lower our wage to such a level that we should be able, on level terms, to compete with Japan. In other words, the Australian workmen would be forced down to the coolie level.
On the question of costs in the industry, I refer honorable members to the report of the Tariff Board itself. The Tariff Board comments that, in view of the heavy costs in comparison with the British product, it may be uneconomic for it to be carried on in this country. The same thing is said about every new industry. Whereas wages paid in the Australian industry have remained practically stationary and the wages paid to coal-miners and others who supply the raw materials have not altered, in Britain the wages of coal-miners almost collapsed, and the British manufacturers have had that advantage over the Australian manufacturers.
The former Under-Secretary for Employment (Sir Frederick Stewart) once stated that consideration must be given in this country to the matter of employment of females. In the British industry, only 55 per cent, of the employees are males, but in the Australian 93 per cent, are males. Up to the present this country has given a lead to the rest of the world in the solution of the problem of females in industry, but the Minister for Trade and Customs would have it take a retrograde step from its present proud position. He wants women to replace men in the earthenware industry, in order that it may compete with British products. This party is opposed to women doing the work of men in industry.
The Graziers Association was represented before the Tariff Board, in opposing continuance of the former duties. What interest has the Graziers Association in this item? I advise honorable members to read an article about farmers written by “ Chick “ Sale, an American writer. They will then realize what little interest graziers have in this matter. The Farmers and Settlers Union was also represented. My 50 years’ experience in the bush convinces me that such people have no interest in these matters. Yet these people, these “ qualified experts “, gave information to the board on which it acted. The Minister ha3 promised to refer this item back to the Tariff Board. He should certainly do so. Wages are starting to increase in Australia and as costs in the industry go up, so will the protection given under the duties contained in the schedule before the committee disappear.
With regard to the profits made by the Australian industry the Tariff Board, in its report, discloses that oversea competition prevents higher prices from being obtained, and that reduced duties will result in serious losses.
It cannot be charged against this Australian industry that it is making enormous profits. For three years it carried on without making any profit, because it made a promise to the Government that prices would not be increased. Last year the profit earned was only 5-i per cent. British manufacturers do not compete in this country with lines on which there is a small profit. They compete only on popular articles, in the hope that the Australian manufacturers will give up making unprofitable lines, and so leave the Australian market to Britain.
The building trade is the first to feel a depression and it is among the first to show signs of recovery. The Government informed the manufacturers that they would be given absolute protection and that importations would be allowed under licence by the Minister only if necessary. The manufacturers agreed that they would not increase prices, and they have kept their word; but the Government now desires to break that pact by attempting to lower the duties on these goods. As the result of the reduction of the duties, imports into Victoria have increased by 189 per cent, and into New South Wales hy 100 per cent. This has happened already. How much more will that increase be if the duties are not again raised? While the honorable member for Dalley (Mr. Rosevear) was speaking about the danger to Australian industry of Japanese competition, the Minister for Trade and Customs interjected that there was nothing to fear. There is absolutely no hope of this country ever being able to compete against Japanese goods. I hope that the Minister will refer this item back to the Tariff Board, and that, in the meantime, the reduction of duties will be suspended.
– I rise mainly to urge the Minister for Trade and Customs (Mr. White) to do all that he possibly can to see that the reference of this item to the Tariff Board is expedited. I appreciate that there has been a very substantial increase of importations from overseas of the goods under consideration. I regard this as a natural industry. Ninty-eight per cent, of the materials used are of Australian origin and over 70 per cent, of the production costs is absorbed in wages. The ratio of wages to total costs of production is higher than that of any other industry. Since the reduction of the duty in 1934 from that which had existed since federation, importations have increased from £12,055 for the year ended December, 1934, to £23,155 in the year ended December, 1935 - an increase of 92 per cent. The building trade has made a substantial revival. It is one of the industries which suffered most during the depression. In Melbourne and Sydney in 1935 an increase of £15,513,916 was recorded in building permits issued, which is an increase of 46 per cent, over the figures for 1934. Yet one of the leading Australian earthenware companies in the best position to participate in any improvement showed an increase of sales of only 22 per cent, in the period. One firm in Melbourne with very large experience did not increase its sales at all in 1935. As a matter of fact, they were 3 per cent. less. In the United Kingdom, the tariff on earthenware goods is higher than was recommended by the Tariff Board on this item. The duty on similar items under the United Kingdom tariff is 20 per cent., and an endeavour is being made to have that increased to 50 per cent. I had intended to move to have the item referred back to the Tariff Board for an early report,, but as the Minister has already referred it back, I, accordingly, did not move the amendment. I rise mainly to urge the Minister to ask the Tariff Board to make this an urgent reference, and to submit an early report, so that the committee will have a further opportunity to discuss it. I understand that that course meets with the wishes of the industry.
I hope that arrangements will be made for the country of origin to be branded on these articles so plainly that when placed in buildings there will he no doubt of their source.
– That will be done.
– I am grateful to the Minister for so readily accepting the suggestion.
.- I am opposed to the reduction of duties proposed in the schedule before us. Like other honorable members on this side, I am of the opinion that lower duties will have a serious effect upon the Australian industry, in which £250,000 capital has been invested, and buildings, plant and machinery to the value of another £150,000 have been erected. The amount paid annually in wages to workmen directly employed in the industry is £42,000, and the output of the various Australian factories is valued at £100,000 per annum. In reading the report of the Tariff Board which contains those figures I was particularly interested in the arguments advanced by the representatives of importing interests. The late Mr. L. T. Courtenay who represented Tylors (Australia) Limited, said
The main reason why local manufacturers have secured thebulk of the local market is that a large proportion of them have improved the quality and designs of their products.
That improvement of quality and design is largely due to the fact that for some years the local industry has had practically the whole of the Australian market, because of the protection afforded it by the embargo which was in force. Giving evidence in favour of reduced duties, Mr. Courtenay said later -
I am quite prepared to admit that the deliveries from Fowler’s, as far as my firm is concerned, have been very satisfactory, particularly during . the last two years. In my previous evidence in 1932 I said that we were unable to get deliveries but we have no cause for complaint on that scope recently.
That the quality and design of the Australian goods are satisfactory, and supplies are available to purchasers, has been admitted by representatives of the importing interests. If the duties are reduced, the British manufacturer, who is already protected in his own country, will bo encouraged to exploit the Australian market still further, particularly as he employs mostly female workers at lower rates of wages than are paid to male workers in Australia. Official statistics show that the wages paid to workers in the Australian industry are at least 75 per cent, higher than those paid in Great Britain. The difference in running costs alone justifies double the rate of duty now in force, and it would seem almost unnecessary to indicate further directions in which the advantage is with the overseas manufacturers. Mention must be made of the cost of materials. From prices quoted in the Times Supplement,, it would appear that the price of coal in Great Britain is more or less constant at between 13s. and 14s. 6d. a ton, whereas in Victoria the rate is generally from 30s. to 35s. a ton. These facts speak for themselves.
In dealing with this item, I desire to refer to another industry which was discussed in this chamber a few days ago. I then asked for information relating to the importation of cement into Australia
– Order ! The honorable member must confine his remarks to the item before the Chair.
– What I said then has been amply borne out by the official figures; importations have materially increased to the detriment of the local industry. If the duty on the item now before us is reduced, as set out in the schedule, the Australian industry must suffer. In my opinion, it is an industry which we should foster and protect until it has command of the whole of the Australian market, because 98 per cent, of the raw materials are of local origin, the workmen in our factories understand thoroughly the various processes of manufacture, large numbers of male workers are employed at reasonable rates of pay, and an entirely satisfactory article is being produced. Of the quality of the Australian goods I can speak with some experience, because recently I had occasion, in connexion with the erection of a new home, to compare the Australian product with similar goods imported from England. In conversation with the retailer, I asked what advantage the British product had over the Australian, and he said he did not know of any.
– How do they compare as to price?
– The imported article is a little dearer. I purchased the locally produced articles because I was convinced that they were satisfactory in every way. I am entirely opposed to the reduction of the duty from 30 per cent, to 15 per cent., and cannot entirely accept as satisfactory the Minister’s statement that the duty has been referred back to the Tariff Board. If the committee passes the item as it stands, I am afraid that the Tariff Board will report that the duties in the schedule are reasonable, with the result that they will remain.
.- Australian industries cannot be fostered and developed by reducing the protective duty as is proposed in connexion with this item, particularly in view of the large quantities of Japanese goods now on the Australian market. According to press reports, the Minister for Trade and Customs (Mr. White), when approached last October in regard to the menace of Japanese goods, said that there was no danger of such goods competing seriously with the Australian product. Nevertheless, Japanese goods continue to be offered for sale in our cities. During the week* I bought a cup and saucer marked “ Made in Japan “ which was packed with English confectionery. Thus, crockery made in Japan is shipped to England, filled with an English product, and admitted to this country under the British, preferential rates of duty.
– Such goods would be charged the foreign rate of duty.
– The English earthenware industry is not protecting its own interests by permitting the importation into England of Japanese crockery which, after being filled with confectionery, is exported to Australia, admitted to this country under the British rates and sold in competition with its own products.
– Such articles could not come in under the British rate; if they are Japanese goods they are subject to the foreign rate of duty.
– The Minister knows very well that Japanese goods produced under cheap labour conditions are competing with Australian-made goods to-day. In the building industry Japanese tiles are being used-
– The honorable member must confine his remarks to the item before the Chair.
– The point I am endeavouring to make is that overseas companies are picking out lines popular in this country and shipping them to Australia to the detriment of our secondary industries. I am totally opposed to a reduction of the duty. Further, I consider that the Tariff Board is not the proper authority to be vested with the final decision in regard to this matter, and that this Parliament should not he asked to adopt its recommendations in their entirety.
– Before the committee is asked to cast a vote on this item I desire to refer to one or two points so that honorable members may clearly understand what the Minister for Trade and Customs (Mr. White) proposes to do and what a vote in favour of his proposals would actually mean to the earthenware industry. Opposition to the Government’s proposals by ministerial supporters seems to have been stifled by the statement of the Minister that he proposes to refer this item back to the Tariff Board for further investigation and report.
– It has already been referred back.
– The Minister also said that action would be taken to ensure that all future importations of earthenware of this class shall be branded with the country of origin.
– That was announced months ago.
– The fact that it may have been announced months ago is beside the point ; what I am concerned with now is that these two points were brought forward by the Minister to-night, and, undoubtedly, they have influenced some honorable members opposite to modify their views. The honorable member for Moreton (Mr. Francis) has said that the earthenware industry is satisfied with the undertaking given hy the Minister. How can the honorable member possibly know that the industry is satisfied? Such a statement is misleading to honorable members who wish to do the right thing by the industry and may create a false impression elsewhere. If the Minister would agree to refer this item back to the Tariff Board and to suspend the application of the reduced duty, he would be facing the problem in a fair and impartial way. But he does not propose to do so. The reduced rate of duty will apply while that further inquiry is being made. Apparently there are a number of factors which, in the opinion of the Minister, the board has not fully considered, because if he were satisfied entirely with its report he would have sat pat on it. If there is a doubt at all in regard to this matter - and I think the honorable member for Dalley (Mr. Rosevear), with authoritative figures, has proved that a doubt exists - the matter should be referred back to the board for full investigation and report, and in the meantime the former duties reverted to. In reply to the honorable member for Dalley, the Minister quoted further figures which he says were prepared by his department. I have no desire to attack the Department of Trade and Customs, but I point out that if the department has any preconceived ideas on this matter its submissions to the Minister are likely to be coloured by them.
– The department’s estimate was based on information asked for by telegrams sent to the collectors of Customs in each State.
– It seems to me that that is not sufficient authority to guarantee the accuracy of the figures. Opportunity must always be afforded for cross-examination of persons giving evidence. In this case that crossexamination must be conducted by those with ability to do so. The committee should not be asked to accept statistics when no opportunity has been afforded for crossexamination of the persons furnishing those statistics. There again, doubt arises.
Honorable members will appreciate the fact that the earthenware industry has to engage in different forms of production. With the limited population of Australia, it is not possible for such an industry to carry on and keep down overhead costs unless it exploits all avenues of production. Only in this way can the losses in one department be balanced by gains in others. But if the Tariff Board snipes at this industry by lowering the duty on articles produced in one department, and it is not possible to offset the loss in that department by a gain in another, the industry is finally destroyed. It is unfair and injust for the Minister to single out certain classes of manufacture by the earthenware industry and to found his case on them. If he is fair and deals with this matter from an Australian viewpoint, he will give this industry every credit because of the many and varied forms of its production, and assist it in every possible way. There is, I repeat, a doubt as to the board’s investigations into this industry, and, because of that fac* and the harm that the reduced duties must necessarily inflict upon it, the matter should be referred back for full investigation. Even then, as honorable members know, from past experience, when items are referred back to the Tariff Board for further investigation and report, quite frequently twelve months elapse before an opportunity is again presented for honorable members to discuss the further recommendations of the board concerning the industries. Although we recently passed an act of Parliament which provides that a schedule of duties must be validated within six months of its tabling, we have already had experience of validating bills being brought forward which have been designed to defer discussion. “What has been done in the past will, I Have no doubt, continue to be done in the future. Meanwhile, as I have said, so long a time elapses when an item is referred back to the Tariff Board, that its further investigations are quite useless, the industry not having survived. I appeal to the Minister to view this matter fairly in the interests of the Australian manufacturers, and to satisfy any doubts that arise in the minds of honorable members and those engaged in the industry itself.
.- The Tariff Board, in its report, suggests that the earthenware industry has made exorbitant profits, and has drawn attention to the fact that the prices of some articles manufactured in Australia are 220 per cent, above the British f.o.b. price. This is quite conflicting with the result of operations of at least one of the big Australian concerns, Fowler’s Limited, a most efficient firm which has been in existence for nearly 100 years. From 1927 to 1934, according to the statement I have here, no profits were made by this company and no dividends were declared. Last year a small profit of 3d. a share was paid to shareholders. If Australian manufacturers are to be compelled to submit to the Tariff Board figures, based on audited reports, showing the costs of production, it is reasonable to suggest that, in order to arrive at a fair basis, the same procedure should be adopted in respect of overseas manufacturers applying for tariff reductions. This is a vital principle in tariff making in Australia.
.- Since I came into this House, many years ago, I have always held the view, in connexion with tariff matters, that if an industry is natural to Australia it should be given sufficient protection to enable it to function properly. There is no doubt, I am sure, in the mind of any honorable member that this industry is definitely a natural industry, because, a* has been stated to-day, 98 per cent, of the ingredients used in the manufacture of its commodities are of Australian origin. In assessing the amount of duty necessary for the protection of a natural industry, three points must be taken into consideration. The first is: can the industry supply Australian requirements on a commercial basis? The Tariff Board report and the arguments advanced in committee on this item show that the earthenware industry is able to supply the Australian market. The second point is: does the quality of the goods offered for sale in Australia compare with that of overseas ‘products? I think it has been proved definitely that there is no doubt as to the quality of the Australian article. One gentleman, representing an important firm of importers, has stated that the quality of Australian-made goods was all that could be desired. Thus two of the points to which I have alluded are met. The third point and an important one is the price at which Australian articles of thi3 class are sold, as compared with similar imported goods. In considering this aspect of the industry, we must have regard for the difference between what may he described as the natural costs in Great Britain and Australia respectively, bearing in mind, particularly, the higher living standards enjoyed in Australia. The evidence adduced shows that, under the high protection enjoyed prior to the inquiry by the Tariff Board, Australian goods were being sold at competitive prices. I think that any unbiassed person reading between the lines of the board’s report must come to the conclusion that members of the board were themselves in some doubt as to the measure of protection to be recommended. Their recommendation was, I suggest, submitted with a certain amount of diffidence; and, this being so, the question of whether the duty should be below the amount previously in operation is one for this committee to determine. In respect of another tariff item, dealt with last week, it was shown that excessive profits had been made by Australian manufacturers, and that users of the commodity in question had been exploited. That objection cannot be urged against this industry. Other honorable members have given figures to show that, even during the period when there was an embargo on the importation of overseas goods of this description, when Australian manufacturers had the local market to themselves, and thus had an incentive to increase their prices, some companies showed a loss on their operations. Therefore, the charge of profiteering cannot be laid against the Australian manufacturers of this class of goods.
I am glad to know that the Minister for Trade and Customs (Mr. White) has promised to refer this item back to the board for further inquiry. Apparently, there is some doubt in his mind as to whether the recommendation of the board gives fair and reasonable protection to the Australian industry. The further inquiry will enable the Australian manufacturers to present additional evidence and possibly strengthen their claim for a more adequate measure of protection. The promise of the Minister is acceptable, but what will happen to the industry in the meantime ?
– That is the point.
– We cannot ignore the fact that the continuance of lower duties pending a further recommendation from the board may imperil the industry. I therefore appeal to the Minister to reconsider his attitude to the amendment moved by the Deputy Leader of the Opposition. I ask him not to be influenced by the source whence it comes, but to treat it on its merits. Its adoption should not be construed as a contravention of the Ottawa agreement.
– It would be.
– I am sorry that the Minister has raised this point because I feel sure the feeling of the committee is that no contravention of the Ottawa agreement would be involved.
– Read article 10.
– Article 10 provides that United Kingdom producers shall have opportunity of reasonable competition. This item is covered by article 12, which reads -
His Majesty’s Government in the Commonwealth of Australia undertake that no new protective duty shall be imposed and no existing duty shall be increased on United Kingdom goods to an amount in excess of the recommendation of the Tariff tribunal.
The undertaking is that no new protective duties shall be imposed. The carrying of the amendment would not mean the imposition of a new protective duty, nor will it mean an increase of an existing duty, because the British preferential rate existing at the time of the signing of the Ottawa agreement was 26^ per cent., lj per cent, higher than the duty now suggested.
– That is not what the article means.
– That is what the article says. It states that “ no existing duty “ shall be increased on United Kingdom goods to an amount in excess of the recommendation of the tariff tribunal.” Article 11 deals with inquiries to be made by the Tariff Board of existing protective duties as they affect goods of United Kingdom origin. In pursuance of its undertaking given in that article tlie Government instructed the board to inquire into and submit a recommendation concerning this industry. The recommendation of that tribunal is in the hands of honorable members. We may refuse to accept it or we may vary the duty. I, for one, shall not surrender my responsibility in this matter to an outside body of four men; I shall not allow that tribunal to say how I shall vote on any particular item. I ask the Minister to give the committee an assurance that he will refer this item hack to the board with a request that the tribunal shall treat the inquiry as urgent. We would then have an opportunity to consider the item in the light of later information. If the honorable member will do this, I shall support the Government.
– I have already referred the item back to the board, and I will do as the honorable member suggests if the board’s report is received by the time the schedule is dealt with in the Senate and returned to this House.
– The board was occupied from the end of May to the 3rd of July inquiring into this industry prior to submitting its main report, so if it treats as urgent the re-submission of the item, its further recommendation should be in the hands of the Minister in time to enable him to bring down an amended schedule. If the Minister will give us a definite assurance that the committee will have an opportunity to deal with a further report from the board before Parliament adjourns for the winter recess, I shall support the Government.
– I have no enthusiasm about the recommendation of the board in respect of this item. It is about time that the people of Australia realized what kind of a mess we have got into through the adoption of the Ottawa agreement. I sympathize with the Minister for Trade and Customs (Mr. White) in this matter, because we are now experiencing repercussions of the Ottawa agreement, and some of us, who voted for it, are going to pay for our sins of commission. I think that this Government now realizes, as I am certain leading industrialists recognize, that Australian industries have e been undermined by a too strict interpretation of the terms of the Ottawa agreement.
– Can the honorable gentleman point to a single industry which has been undermined?
– The industry which the committee is now discussing.
– That is not so. Look at the employment which it gives.
– I listened carefully to the Minister’s attempt to defend the attitude which he has adopted. That his heart was not in the task was obvious to everyone. Labour members must support the protection of secondary industries in order that men may be kept in. employment. Generally speaking, the Australian manufacturers have been satisfied with the policy of this Government. All ‘thinking persons, however, and especially those who are associated with secondary industries, have come to the conclusion that the Ottawa agreement has not worked out as was anticipated. I am certain that the Minister also holds that view. It was quite plain from the outset that articles 10, 11 and 12 of the agreement were bound to exercise control over the industries of this country. The Tariff Board had placed in its hands the direction of our fiscal policy. The worst feature was that British manufacturers were given a voice in determining when the stage was reached which would give them reasonable opportunities to compete with Australian manufacturers. Whoever previously heard of such a onesided proposition?
By and large, the policy of the Government has been to accept the recommendations of the Tariff Board ; and it is known that that .body has been partly influenced in its decisions by the opinions expressed by British manufacturers. That is the reason for the position in which we find ourselves to-day. If the Minister had sought to make out a substantial case in support of greater protection than is proposed he could not have done better than he has. He admitted that the industry had had to struggle for two or three years because it had made certain promises and had entered into compacts not to raise prices. For two years at least it carried on at a loss with higher duties than are now proposed. Later, because of the impetus given to the building industry, it began to reap a slight reward, and during last year made a profit of 5 per cent. Yet the Minister urges this Parliament to agree to a. 12 per cent, reduction of the protection hitherto afforded it ! Surely this is the hardest task he has yet had to face in defence of tariff proposals ! I wish to arrest the attention of the people of Australia to the mess which has resulted from our agreeing to articles 10, 11 and 12 of the Ottawa agreement. I am certain that the Minister directing negotiations for trade treaties (Sir Henry Gullett), no longer has any faith in the agreement, and that the Minister for Trade and Customs has lost the regard that he once had for it. If one half of the supporters of the Government were honest in their professions they would tell the people that they are opposed to the agreement. If they had the courage to say what they really think, there would be no possibility of the duty on this item .being reduced. I feel sure that the Minister will take some action in connexion with this industry. If he does not, the industry should take up the cudgels on its own behalf, and not leave the fight to those who represent’ the interests of the employees in it.
.- One would think that there was no necessity for the adoption of a policy in relation to exports. The honorable member for Melbourne Ports (Mr. Holloway) has contended that the Ottawa agreement has got Australia into a mess. I invite the committee to consider for a moment the concessions made by Great Britain which enable Australia to dispose of its surplus production, of wool, wheat, meat, butter and other primary products.
– Order ! The honorable member must confine his remarks to the item.
– Our exports to Great Britain have increased enormously as the result of the Ottawa agreement. But for them, how would the Australian manufacturer obtain his raw materials? Exports from Australia are the only means by which he is able to obtain credits abroad.
– The raw materials for this industry are in Australia.
– As no raw materials need be imported then, this is one industry that ought to be able to compete on even terms. Its product is difficult to pack and expensive to transport. If the protective incidence of exchange, duty, and primage, which amounts to 35 per cent., is not sufficient, surely there is something wrong with the industry. I assert that lobbying is responsible for tlie opposition to the proposal of the Government. After the division in regard to cement on Friday, one need not be surprised at anything.
– No surprise is caused by the lobbying indulged in by the honorable member for the purpose of obtaining bounties for certain primary industries. He avails himself of every opportunity to loot the Treasury!
– The honorable member for West Sydney (Mr. Beasley) may not loot the Treasury; but 1 wonder what he would loot ! Numerous statements have been made in regard to this industry. I quote the following from the report of the Tariff Board : -
With exchange Australia on London at par, the reasonable and adequate rate under the British preferential tariff should be 35 per cent.
The Tariff Board realizes that the rate of 15 per cent. (British preferential tariff) under present conditions will not enable local manufacturers to compete with overseas goods in all lines at the prices they are at present charging.
The board makes it clear that, in its opinion, the prices charged are too high. There has been some comment in regard to the employment of female labour. The Tariff Board distinctly says that very few women are employed in the manufacture of these goods in the United Kingdom. On the subject of wages, it says -
It would appear that wage rates expressed in the same currency are generally lower in Australia than in the United Kingdom.
The Tariff Board has an opportunity to obtain full information from both sides, and some notice should be taken of its report. The principal witness for the British manufacturers was Mr. S. F. Ferguson. The Australian manufacturers also made their representations. Mr. Ferguson made tlie following statement in his evidence: -
A comparison of the prices of United Kingdom and Australian products shows that in live out of tcn lines taken, the local maker’s price is more than 50 per cent, higher than the British manufacturer’s f.o.b. price, expressed in .Australian currency.
It has always been, considered that one and a quarter or one and a half days’ wages should be sufficient to pay the rental of an ordinary home. That is not the case to-day, owing to the heavy cost of practically every article required in connexion with building operations. Sanitary conveniences have to be installed almost universally, yet the attempt is being made to keep up the prices of sanitary and lavatory articles. “With such a clear and definite report from the Tariff Board, I cannot understand why so many extraneous statements should be made, nor why certain concessions should be claimed on behalf of those who are engaged in the industry.
.- To any one who is ill versed in regard to this industry, a good deal of the evidence given to-day is most conflicting. Much complexity also attaches to the figures given by the Chamber of Manufactures, the manufacturers of these particular items, and the Minister for Trade and Customs (Mr. White) in relation to the employees in the industry. I agree that the figures which should be accepted are those that refer to persons who are actually engaged in manufacturing the particular items which are the subject of report by the Tariff Board.
– Those are the figures which I gave.
– While those figures reveal a slight increase, there is clear evidence that, during the last two or three years, this industry has not gone ahead at all proportionately with the progress of building operations throughout Australia. In fact, one Victorian concern, reports a lessening of employment. The difficulties and anxieties of the majority of honorable members who sit on this side of the chamber would be met if the Minister would give the assurance that he will recommend to the Tariff Board that it further considers this item at an early date.
– The Minister has stated that he has not the power to direct the hoard as to the order in which it shall make its inquiries.
– The board would not ignore such a request, and its report could be considered in conjunction with any requests made by the Senate.
– That does not necessarily follow.
– That would meet any objections from honorable members on this side.
.- .The high protectionists of this chamber seize every opportunity to condemn the Ottawa agreement. The report of the Tariff Board on this item was not framed with that agreement in view. The reason advanced by the hoard for recommending a reduction of the duty is that the Australian manufacturers have had about 90 per cent, of the business offering, but have not reduced prices to the extent which the circumstances warranted. The board has also pointed out that, with the exception of a few special lines not made in Australia, the business is in the hands of the local manufacturers. Although the prices of earthenware have been reduced in Great Britain, and the wages cost in Australia has been lowered, there has been no reduction of prices to the Australian user. That is the basis upon which the board made its recommendation for a reduction of the duty. The protective incidence, including exchange, according to the board, amounts to 35 per cent, and will, in its opinion, be sufficient to enable the Australian manufacturer to retain the market. I wish this industry to be protected and maintained. It is a good wage-paying industry. I welcome the assurance of the Minister for Trade and Customs (Mr. White) that, because of the suggested likelihood of an incursion into the industry, he has already referred the item back to the beard for further investigation, particularly in relation to the extent to which penetration from outside has taken place or is likely to take place. If it is found that the proposed duties are not sufficient to afford the industry substantial protection against outside competition, I hope that the honorable gentleman will again bring the matter before Parliament.
Much of the discussion concerning the board has arisen from the misconception of the Minister as to the duty of this chamber, having regard to the terms of the Ottawa agreement. Speaking on another item recently before us, he said that failure to adopt the recommendations of the board would constitute a breach of that agreement. It has been stated in the editorial articles of certain newspapers that the Parliament, if it is to carry out the terms of the agreement, is bound to adopt the duties recommended by the board ; but that is not the position. Article 12 of the agreement merely provides that, as regards all industries, which it is desired to protect, the Commonwealth shall not impose any new duties, or increase existing duties above the rates recommended by the board.
– What does the honorable member mean by “existing” duties?
– Those in operation at the time when the agreement was made.
– The “ existing “ duties are those now in operation which the honorable member is opposing.
– I am not opposing any duties, but I consider that the Minister has put forward an untenable argument. This Parliament is not obliged to adopt the recommendations of the board. The only limitation is that we must not increase duties beyond the level recommended by the board.
– That is a legal quibble.
– It is the plain language of Article 12 of the agreement. Articles 10 and 11 envisage a review by the board of the items protected by the Australian tariff, and there is also the statement that British manufacturers will be given a chance to compete; but this Parliament will not surrender to the Tariff Board its right to determine duties. I have acted consistently on the principle that the board is the safest body to guide this Parliament in tariff matters. It is an impartial body, it has opportunities to make exhaustive inquiries, and by this time its members should be experts. But while it is well to follow the recommendations of the board, it is utterly misleading for the Minister or anybody else to contend that the Ottawa agreement binds this Parliament to adopt them.
.- I invite the committee to consider two phases of the report which the board has submitted in connexion with this item. The claim is made that under the Ottawa agreement the British manufacturers of sanitary ware are entitled to reasonable competitive facilities in the Australian market. Article 10 of the agreement says, in effect, that the protective duties imposed in Australia are not to go to such a length as would not give United Kingdom manufacturers full opportunity of reasonable competition based on relative costs of economic and efficient production. That surely imposes on the Tariff Board an obligation to make a precise examination as to the relative costs of efficient and economic production in the two countries, and I am not satisfied that the report which the board has submitted on this subject warrants us in assuming that it has made the necessary investigation. It has based its consideration as to what would be the relative costs on the landed cost of British goods in the Australian market. I submit that that is too dangerous an assumption to make in view of the demoralized condition of world trade, the struggle for markets, and the obvious fact that the production of one country is sold in the internal markets of another more often than not at prices below the actual cost of production. This is true of the item under consideration, and it is also a generalization applicable to the greater volume of world trade. The Tariff Board is surely charged with the duty of stating in definite terms the labour costs in respect of this ware in Great Britain, the overhead costs, the costs of raw material and other details which would enable us to make a true comparison with similar costs in Australia. No such examination has been made. This Parliament, in carrying out what it believes to be its obligations under the Ottawa agreement, should have better knowledge than it now possesses as to whether or not the selling price of the British manufactures in Australia is made possible as the result of a special natural advantage, or, perhaps, because of a standard of economic production which is impossible of attainment at the present time with respect to the manufacture of these goods in Australia. The board shelters itself with regard to this detailed examination behind what I submit is a mere generalization. All the re- ports used as a basis on which to implement the Ottawa agreement are inadequate in the service which they render to the Parliament, because we do not even now know, nor is the Minister able to inform us, what is the true comparison between the labour costs in the Australian and British manufacture of sanitary ware. The Minister cannot tell me the difference between the cost of raw materials here and in Great Britain.
– Included in the evidence submitted to the board were particulars which enabled it to make comparisons of the cost of labour and materials.
– The report contains the board’s summary and its conclusions, but the evidence on which it arrived at its conclusions is not published. As a general principle I am prepared to regard expert investigation as reliable more often than not; but when the obligations of this Parliament have to be considered, I require to be satisfied that the board’s recommendations square with the evidence on which they are presumed to be based. It should be the duty of somebody to ascertain whether the conclusions reached are appropriate to the weight of evidence.
In any case, there is another aspect of this report which is noticed all too frequently in connexion with other reports of the board, and which suggests that the board has made a clerical error in respect of what it construes to be the exchange advantage derived by this industry. I mentioned this point in dealing with another item. The board recommended that under existing conditions, and without the primage advantage, a reasonable British preferential duty would be 15 per cent, and that, if the rate of exchange between Australian and London were now at par, and there were no primage duty, a reasonable rate would bo 35 per cent. Clearly, the board is of the opinion that the exchange benefit to the Australian manufacturer of sanitary ware is equivalent to 20 per cent. ; but I submit tha* a fair appreciation of the incidence of exchange on the internal economy of this country, after five years’ experience of a pegged rate, would make it plain that the purpose of the pegging of the exchange rate is to maintain a new level of costs and prices, and that the real advan tage of the variation of the rate of exchange for the benefit of exporters tended to disappear as time ate up the advantage which the lift of the exchange rate conferred. Although an increase of the exchange rate gives a definite advantage to exporters, because for the time being they get the benefit of increased internal prices without having increased production costs imposed on them, those increased internal costs reflect themselves in this way: Every importer of raw materials in Australia has to pay the exchange rate, and, in addition, every government has to pay the exchange rate on its overseas interest bill, and, therefore, the level of taxation tends to rise, as it has since the present Government has been in power. The Government collects larger revenues, but this reflects itself in the variations of prices. Two things have happened in Australia which prove this conclusively - constantly rising price levels, having regard to the stability of the exchange rate, and an improved condition of the Australian economy, due to the lift of the. exchange rate. The very fact that the Minister and his colleagues are to-day perturbed over the balance of payments, due to the increase of imports into Australia, is conclusive evidence that imports, which were prohibited competitively when the exchange rate was lifted in the early stages of control, can now come in, because internal costs have risen, reducing the advantage of the Australian manufacturer. .The swelling stream of imports during the last 30 months has been due, not so much to reductions of duties as to the almost complete, but none the less certain, disappearance of the advantage which the exchange rate conferred when the pegging first took effect. If that is not true, then there is no economist in Australia worth “ tuppence “, because that is what economists teach their students in every university, and that is the reasoning to be found in every textbook on economics.
– It is certainly academic, but it has not worked out in practice.
– I can submit practical evidence. There is nothing academic about the swelling stream of imports into the Commonwealth, and that has been made possible only by the increased ability of imports to penetrate the Australian market, having regard to two factors - the price level of the Australian market and the price level of local manufacture and production. During the last two and a half years the advantages which came to Australia as a result of the lift of the exchange rate have tended to lessen. That is my contention. The 20 per cent., which the Tariff Board submits, may or may not be a reasonable proposition, but the exchange rate is 25 per cent. Therefore, the Tariff Board itself confesses that the full advantage of the exchange rate is not available to the Australian manufacturer.
– It varies in every industry.
– Of course it does, but the Australian manufacturer of sanitary ware does not import any materials worth mentioning. Practically the whole of the raw material which he requires is obtained in Australia.
– That is not correct; the manufacturer imports some glazing material, equal to 5 per cent, of his total requirements.
-It is a fact that 9S per cent, of the material required is of local origin. In addition it must be palpable to the Minister that this blind acquiescence by the Tariff Board in 1936 of principles which it accepted mathematically in respect of exchange rates three years ago does not show a true appreciation on its part of the changing incidence of a pegged exchange on the economy of Australia. Therefore, if the board is right now, it must have been wrong three years ago.
– There is the provision for adjusting the exchange if any appreciation occurs.
– The board’s calculation is that if the exchange AustraliaLondon, were at par, the duty on this earthenware should be 35 per cent. ; but, because the exchange is 25 per cent, against us, it decides that 15 per cent, is adequate. Therefore, it is obvious thai, on this particular of exchange alone, it has knocked out 20 per cent, of what it would construe to be the necessary protection for the Australian industry to be affected by the tariff. If the board he wrong to any substantial extent, in its estimate of the significance of exchange as a protective element, incontestably the tariff schedule fails to give this industry the margin of protection which, in the opinion of the board, is essential ; because it says that, had the exchange stood at parity, a duty of 35 per cent, would be required to afford this protection. If its present estimate of 20 per cent, of the value of the exchange to the Australian manufacturer is not the correct estimate, the board fails to secure to the Australian manufacturer the protection of 35 per cent, which it says is essential, having regard to the relative costs in the two countries.
– Why does the Leader of the Opposition doubt the figures of the Tariff Board?
– Because I consider they are wrong. I am convinced of that fact, because all the evidence goes to show that a 25 per cent, in the incidence of exchange, in 1931, which has remained pegged for five years, cannot possibly have anything like the value of 2*5 per cent, after there has been effected stability in the exchange rate as the result of monetary management.
– The Tariff Board gives 20 per cent, as the figure in its report.
– I am aware of that; but that means that the board assumes that 5 per cent, of the exchange rate disappears as a protective element to this industry. I submit that those two points, at any rate, ought to be revised. I understand that Dr. Wilson, having been appointed Commonwealth Statistician, is no longer acting as Economist, and that Dr. Smithies is now filling this position. In my opinion, either of those two gentlemen should be invited to furnish a memorandum to the Tariff Board in this connexion. Some years ago it was suggested that the board should have an economist attached to its personnel. There may be a disagreement among economists as to what effective exchange rate remains in connexion with the tariff as a real element of protection for the manufacturer. As a matter of fact, the wheat-growers had better discover whether or not they are deriving the full value of the exchange.
– They are.
– They have to pay more in taxation and their costs have increased; nevertheless, they assume that they are still getting the full benefit of the exchange. The Deputy Leader of the Opposition reminds me that in 1933 the Tariff Board said -
The board is of the opinion, however, that, if the exchange persists at its present level for a period of two years, world conditions as to costs avid prices may have altered to an extent which would warrant a reconsideration of the question.
– The Leader of the Opposition is not up to date if he does not know that the Tariff Board has since evolved a new system, and that is what I am suggesting to-night.
– The 20 per cent, which has been taken off the 35 per cent, is merely an estimate. The board gives no figures in support of its contention. There is no examination as to the incidence of the exchange.
– Yes, there is. The honorable member will find the reference in paragraph c. There is an automaticadjustment factor which will operate if the exchange rate alters.
– I am speaking of what will happen if the exchange .rate remains fixed, which is the essential condition of this argument. It is inevitable that the first advantage of an increased rate of exchange tends gradually to disappear until a new norm is struck, and that is the position which Australia has apparently readied in regard to the advantage which the exchange rate gave to manufacturers when the lift was first effected. If the Minister wants an explanation for the swelling stream of imports, it is due to two factors - first, Australian manufacturers, in competing against those imports, have tended to lose a substantial part of the exchange rate, and, in addition, that loss has not been compensated for by any increase of protective duties. On the contrary, their position has been aggravated by the policy of the Government in reducing the duties. These two considerations have had the effect of making Australia a greater market competitively for manufacturers in every part of the world, and thus they have been able successfully to penetrate Australia. Indeed, so successful has been that penetration that as a result the Government is hard pressed to find the cash overseas with which to meet its obligations.
– Most honorable members, irrespective of their political beliefs, agree that the manufacture of these sanitary articles is a very important industry to Australia, because it provides employment for a considerable number of persons, uses Australian capital, and 9S per cent, of the raw material required for manufacture is derived within the Commonwealth. Likewise, most honorable members seem to agree that it is an industry which this Parliament should protect. Parliament hitherto has accepted and endorsed the recommendations of the Tariff Board, but I do not agree that it should blindly follow those recommendations. This committee has an obligation on it to sift tlie evidence and prove to its own satisfaction that an industry which employs Australian workmen, uses Australian material, and provides an avenue for the investment of Australian capital, demands its attention and support. To-night the Government is asking the committee to accept the recommendation of the Tariff Board for a reduction of the amount of duty, both British preferential and general, on imported sanitary goods. The Deputy Leader of the Opposition (Mr. Forde), for the purpose of having this matter more thoroughly investigated, has moved an amendment that the item be postponed. Having listened carefully to the discussion, I consider that several factors of the utmost importance demand the most careful attention of the committee before it arrives at its decision. The honorable member for Richmond (Mr. R. Green) has raised a point in regard to the powers which this Parliament has under the Ottawa agreement of increasing duties beyond the point recommended by the Tariff Board or beyond that which was in existence at the time that the Ottawa agreement was endorsed by this Parliament. The Minister for Trade and Customs (Mr. White) has said, in effect, that this position does not obtain at all. I understood him to say that articles 10, 11, and 12 of the Ottawa agreement stipulated that the duty existing at the time that we proposed to make an alteration should not be raised. The Leader of the Opposition (Mr. Curtin) has suggested that the committee should postpone the item. If we are not satisfied with the Government’s proposal, we have either to support that amendment to postpone the item, or to vote against the item itself, in which case the duty would revert to that which was in existence before the new proposals were tabled in November last. Let us suppose that the committee agrees to the proposal of the Government for a reduction of the duty from 26¼ per cent, to 15 per cent in regard to British preference. The Minister has promised - and I have no reason to doubt that he is giving effect to it - that he will immediately refer the item again to the Tariff Board. I point out, however, that this committee, having accepted the lower rate of duty of 15 per cent., would not, on the Minister’s own interpretation of the Ottawa agreement, be entitled to agree to any increase of duty. That is the point submitted by the honorable member for Richmond. He stated that he read the Ottawa agreeement to mean “As the tariff existing on the date of endorsement of the agreement “.
– It was convenient for him to do so, but it is not the case.
– The Minister said that it was the duty in existence at the time a proposal was made to alter it. I ask the Minister if that interpretation of his remarks is correct?
– Then we come to the point that I am endeavouring to make. If we accept the Minister’s own assertion that it is the duty in existence at the time that a new recommendation comes to this Parliament, we have no power to raise the duty beyond that in existence after we have adopted the proposal before the committee.
– The honorable member cannot move now to increase the duty.
– Then what good purpose is to be served by referring the duty back to the Tariff Board for its consideration?
– A new report can be obtained from the Tariff Board.
– I am dealing with the Minister’s own interpretation.
– If the board make a new recommendation, and it is for an increase of duty, it can be tabled here and will operate.
– Perhaps I misconstrued the honorable gentle man’s remarks, though I have no desire to do so. The honorablemember for Richmond (Mr. R. Green) pointed out that the adoption of the Ottawa agreement meant the adoption of the duties in operation at that time, andthe board seems to be bound not to raise duties above that level.
– The board may make what recommendation it likes, and Parliament may, without violating the agreement, adopt that recommendation.
– But the board must take the Ottawa agreement into consideration.
– Of course.
– The board, therefore, is the judge- of what the tariff shall be, and this committee apparently has no say whatever. The honorable member for Swan (Mr. Gregory) said that the Tariff Board had complained that the industry had not reduced prices. In reply to that, I point out that one manufacturer, at any rate, has made no profit for seven years. How, then, can prices be reduced ? I am not prepared to vote in support of duties which will crucify this industry. I should prefer to accept the suggestion of the Minister that the item be referred again to the Tariff Board, but as there seems to be some confusion regarding whether or not the board may recommend an increase of duty, I think it would be better to vote against the item, thus allowing the duty to revert to the previous level. This industry has been operating in Australia for the last 35 years, and we should rather be guided by its experience over that period than by what has happened since November last, when the new duties were imposed. I think that the Deputy Leader of the Opposition might be wise to withdraw his amendment, and let the committee vote against the item so that the previous duties will once more come into operation. The item could then be referred to the Tariff Board for further consideration.
– We are prepared to do that.
.- The Deputy Leader of the Opposition (Mr. Forde) erred in saying that the Tariff Board considered that the exchange rate afforded protection to the extent of 20 per cent. The proper figure is 15 per cent. The Tariff Board, in its report, stated that if the race of exchange were at par, and primage duty non-existent, a reasonable and adequate rate of duty would be 35 per cent. British preferential, this being made up of 15 per cent, duty, 5 per cent, primage, and 15 per cent, exchange.
– I desire to stress the point made by the honorable member for Parkes (Sir Charles Marr) that, if the committee ratifies this duty now,, it will not have an opportunity to pass judgment upon any future recommendation of the board, should the item be referred back to it. The board may bring in another report again recommending the rates of duty against which we are now complaining, and that recommendation will have to be accepted. Because the effect of the Minister’s proposal would be to tie the hands of Parliament, I cannot accept it.
– I have already arranged that this item be again considered by the Tariff Board. I do not fear that the industry is being injured in any way by the importations at present entering Australia. That is my reply to the honorable member for Melbourne Ports (Mr. Holloway). Production by Australian manufacturers has steadily increased, as is shown by the trading and employment figures already quoted. The value of Australian production over the last five years has been as follows : -
For the first eight months of the present year, the figure was at the rate of £110,000 per annum. Despite this steady increase, the honorable member for Parkes (Sir Charles Marr) spoke of the industry being crucified. Surely it must be realized that the members of the Tariff Board, who are skilled in the taking and weighing of evidence, must know more about these matters than can any one in this committee. The board stated that it had compared prices and conditions in Australia with those in Great Britain. A transcript of evidence given before the board is available, in addition to the board’s report, and may be perused by honorable members if they so desire.
The board recommended rates of duty which, it said, will sufficiently protect the Australian industry, and the figures I have quoted show that they are doing so. It has been shown that the Australian manufacturers are getting 90 per cent, of the Australian trade, while most of the importations represent goods of a kind not manufactured in Australia. The Australian manufacturers did not have an absolute monopoly of the trade even when importations were nominally prohibited, because some goods were always admitted under licence. The manufacturers must always expect to meet some competition. Usually they have internal competition to meet, but in this case they have not, prices having been kept up to the 1929 level by an arrangement among themselves.
The Tariff Board has said that those prices can come down considerably. The honorable member for Parkes stated that one firm had not made a profit for seven years. I have been through both of the works of the particular firm mentioned, and I point out that they make numerous lines of articles apart from those covered by this item. As a matter of fact there are only 288 men throughout the Commonwealth employed in the manufacture of sanitary and lavatory earthenware. Honorable members who have told us a pitiful story of the profits and losses of these firms over a period of years have shut their eyes to the essential facts.
– Will the Minister answer my question as to whether, if the Tariff Board reports again on the item, this committee will have another opportunitytodiscuss it?
– Yes. If the new recommendation of the Tariff Board is to increase the duties, the Government will consider this item again and bring down another schedule.
– Would that be a breach of theOttawa agreement?
– No, because the matter will have been referred to the tariff tribunal.
– And what will happen if the board does not recommend an increase?
– The same as has happened on other occasions, as, for instance, in respect of the duties on cement. That item was referred back to the Tariff Board, and the board considered that no alteration was necessary. Its report to that effect has been tabled. However, if an increase is recommended a new schedule will be brought down and another opportunity given to the committee to discuss the item.
– A higher duty could not be imposed unless the Tariff Board recommended such an increase?
– That is so. In reply to the further query as to how we are in danger of transgressing the Ottawa agreement, I point out that the last line of article 12 of the agreement is very specific on this point and, whilst honorable members may hoax their consciences by saying that the agreement will not be transgressed by the restoration of the higher duties, I assure them that self-deception will not avail them. Those honorable members who, at the last election, told the people that they supported the Ottawa agreement because it would permit of two-way trade between Britain and Australia in place of the one-way trade previously existing, should recognize that they cannot have it both ways. For instance, they cannot have the benefit of the increase of the value of exports from Australia to Britain by £7,500,000 since 1931, without making some concessions in return.
– Then the Minister is prepared to knock over this industry?
– No. Under the prohibitions and anti-dumping duties applied to their industries during the depression many manufacturers pushed up their prices to the full incidence of that protection, so that similar goods imported from overseas, cost just a little more than the price of the local articles. I do not make that charge against manufacturers in this industry. However, some industries exploited the Australian public in that way, and there has been scathing comment of the paper, cement, and bottle industries, to mention only three. Under the Ottawa agreement an obligation was placed on us to review our tariff and to remove obstructions to trade. That has been done; prohibitions and surcharges have been removed and certain duties have been revised. Yet, at this juncture, the honorable member for Melbourne Ports (Mr. Holloway) says that the Ottawa agreement is a fraud.
– So it is.
– Honorable members opposite have very short memories if they do not remember that the number of employees in factories in Australia declined to the very low ebb of 337,000 during the unfortunate regime of the Scullin Government.
– That had nothing to do with the Ottawa agreement.
– Mr. Chairman, I rise to a point of order. Can such a matter as the decline of factory employment under the Scullin Government, be discussed on this item ?
– The matter is involved in a consideration of the effect of the Ottawa agreement, which has been admitted to be involved in this item.
– Members of the Scullin Government took credit for an increase of employment as a result of that Government’s tariff policy. The maximum employment in factories in any period had been in 1928, when the total number of employees reached 452,000. There was a steep decline during the regime of the Scullin Government, but now the number of employees engaged in Australian factories is 459,000. I challenge the honorable member for Melbourne Ports (Mr. Holloway), who spoke glibly of wrecked industries, to name a single industry in the Commonwealth which has suffered under the Ottawa agreement, and the tariff policy of this Government. To-day instead of only a certain section of industry being protected, the consumer is also considered, because prices have been forced down as a result of the reviews by the Tariff Board, some of which were very necessary. To-night, the Leader of the Opposition (Mr. Curtin) referred, as he has done frequently, to the incidence of exchange. He accepts the academic idea that because the currency is depreciated in any country, costs immediately rise.
– He did not say that costs rise immediately.
– If not immediately, nf any rate, gradually, which further assists my point. What has been the result?
In spite of the abolition of the duties applying to the biscuit and wire netting industries in Western Australia those industries are expanding, and imports are not increasing, although the only protection is that afforded by exchange. As another case in point, let us take the industry covered by the item now before the committee. In this case, the Tariff Board has recommended slight reductions of3¾ per cent. on British goods costing over 20s. f.o.b., and11¼ per cent. on British goods costing under 20s., whilst a prohibitive duty has been left on foreign goods. Despite these slight changes, a day and night has been taken up by this committee in discussing this item, because certain honorable members fear that, in some way, some one may be thrown out of employment as a result of these reductions. “We heard the pathetic plea from the Leader of the Opposition, that as aresult of these reductions hundreds would be thrown out of employment to walk the streets and live on the dole. That is nonsense, and “ sob stuff “, which might be appropriate on the platform, but does not carry conviction in this committee. Any honorable member, who supports the Ottawa agreement, should support the duties proposed under this item. Any honorable member who believes sincerely in a protectionist policy should support these duties, as they are reasonable, and will allow this industry to continue to get a fair share of the local market. Although I gave the benefit of the doubt to the manufacturers by referring this item back to the Tariff Board, I believe that the proposed slight reduction of the existing duties will not injure the industry.
– I want to be perfectly satisfied as to whether this will, or will not, be the last opportunity that the committee will have to exercise a deliberative vote on this item. I was prepared to accept the suggestion that the item be referred back to the Tariff Board, hut a very serious doubt has been raised in my mind as to whether such action will not deprive the committee of all opportunity of final review. My understanding of the assurance given on this point by the Minister, is that if the board, in its wis dom, sees fit to alter its present recommendation, then it will be possible for this committee to review these duties again. But if - and this is more likely - the board finds it necessary to adhere to its recommendation, this committee, keeping within the limits of the Ottawa agreement, will have no opportunity to review the matter further.
– That is correct; what are the honorable member’s fears?
– My fears, apparently, are shared by the Government, which has referred this item back to the board.
– I assure the honorable member that it was entirely on my own decision that that course was adopted. As I have already said, I gave the benefit of the doubt to the manufacturers.
– Did the manufacturers ask that the item should be referred back to the board?
– They made representations to that effect a year ago, but did not give any further particulars until last week.
– I am not prepared to forgo the only opportunity. Obviously, there is still some uncertainty as to the desirableness of adopting the recommendations of the Tariff Board. The fact that the Government is prepared to refer the item back to the board for further inquiry and report, is evidence either that the Government has no fear of the ultimate result in the hands of the board, or that it has a feeling of uncertainty such as we have, that this industry is likely to suffer. I have studied carefully the Tariff Board’s report, in which it admits that a duty of 15 per cent. may be insufficient for some of the articles manufactured by those conducting the industry in Australia. As I feel that it is the last opportunity that I may have to consider this subject on its merits, I propose to take advantage of it. It will still be competent for the Government to send the item back to the board, and when it has made its recommendation, whether in accord with its last recommendation or not, this committee will still be free, without abrogating its obligations under the Ottawa agreement, either to accept or reject a subsequent proposal of the board.
Unless we decide to act now we may have no further opportunity to do so.
– It seems to me that two points are involved in this discussion. The first is the position of the committee in respect of the obligations under the Ottawa agreement, and the other is that raised by the Leader of the Opposition (Mr. Curtin) with regard to the protective benefit of exchange. As I understand the position, the Ottawa agreement simply means that the Commonwealth contracted that, during the currency of the agreement, the duties imposed on British goods should not be higher than those recommended by the Tariff Board. The object in so doing was to enable the imposition of duties to be taken out of the hands of a mercurial assembly, and to place the responsibility upon the Tariff Board, a body in which we should have full confidence, particularly in respect of the probity of its members and the impartiality of its decisions. Moreover, every Australian manufacturer and British exporter concerned has the right to place his case before the board and obtain an impartial hearing. I was astounded to learn that the honorable member for Parramatta (Sir Frederick Stewart) doubted the wisdom of sending this item back to the Tariff Board for further consideration.
– I did not doubt the wisdom of sending it back, but I suggested the maintenance of the status quo in the meantime.
– I understood the honorable member to say that even if the board’s recommendation be accepted by the committee the Minister will still have the right to refer the item back to the board.
– If the board submits a similar recommendation, this committee will be impotent.
– If the Tariff Board recommends an increase of duty the committee can support the board’s recommendation, but Parliament cannot impose a duty higher than that recommended by the Tariff Board.
– If the Tariff Board adheres to its recommendation, the committee will be powerless.
– If the committee is not prepared to adopt the recommendation of this board, Parliament should appoint another. If the board is not competent to make a report, what is the use of referring the item back to it for reconsideration? I have every confidence in the probity and ability of members of the board. Further, I submit that neither the Australian manufacturers nor the British manufacturers will be backward in putting their views before that tribunal. The Leader of the Opposition raised the subject of exchange, but I cannot understand how exchange can be accused of what I might term self-cannibalism. If I understood the honorable gentleman aright, he suggested that exchange is, as it were, devouring itself. When the budget is under discussion I shall be extremely surprised to find that, as a result of the process described by the honorable member, interest on our overseas debts has been substantially reduced. Further, if the Leader of the Opposition were engaged in primary production he would realize the benefit of the present rate of exchange. Notwithstanding the fact that the present rate has been in operation for four or five years, and is definitely provided for in fixing customs duties, the Leader of the Opposition suggests that it is devouring itself, and by some process, which I have not been able to understand, is producing a new kind of equilibrium between British and Australian currency. If that be so, I should like to know why the schedule reads “For each £1 by which the equivalent in Australian currency of £100 sterling is less than £125 at the date of exportation an additional duty of . 8 per cent.”. The honorable member cannot get away from that. If the rate of exchange is disappearing there is no justification for inserting the words I have just quoted.
– I did not say that it was disappearing; I said that it was reflected in the costs of Australian manufacturers.
– It is only natural that it should be. The Leader of the Opposition said it was devouring itself.
– No; we know that it is reflected in the price of goods.
– Whatever our economics may be we must admit that a 25 per cent. advantage in the matter of exchange automatically increases the cost of imported goods. The Leader of the Opposition claims that wages have not been restored to pre-depression level, and as costs have reached that level the rate of exchange is a benefit to the extent of 25 per cent. The position must be cleared up, and personally I believe in the maintenance of the present rate.
Mr.Curtin. - I did not argue that it should be altered.
– It would be extremely interesting to know what the Leader of the Opposition did suggest. I should like to have a copy of his remarks.
– The honorable member can be supplied with a proof of his speech.
– The interpretation which I and other honorable members on this side of the chamber placed upon his remarks was that exchange is tending to devour itself and ceasing to be an effective barrier in protecting Australian manufacturers.
I wish to refer to one other point, having in mind particularly the speech of the honorable member for Parramatta (Sir Frederick Stewart).Ina report that he presented to the Government recently he made the following very important statement -
It is, of course, undeniable that the lowering of tariffs and the elimination of quotas and restrictions would mean cheapened goods and consequent increased demand.
If I rightly understood the speech which the honorable gentleman delivered a few moments ago on this item, he is now prepared to vote in favour of a higher rate of duty than that proposed by the Government. I should be obliged if he would explain how he can consistently do so in view of the opinion which he expressed in his report?
– I can hold both views consistently.
.- The duty at present legally in force on this item is equivalent to that provided under the 1921-1928 schedule, and it was in operation prior to the holding of the Ottawa Conference. I understand that it is within the power of this Parliament, without the consent of the Tariff Board, to make any alteration of such duties provided that the new rates do not exceed those in force prior to the ratification of the Ottawa agreement. I had indicated to the Minister for Trade and Customs (Mr. White) that I was agreeable to the reference of this item back to the Tariff Board. I believed that if that course were taken, the Parliament would still retain the power to vary the duty so long as it did not apply a rate in excess of that in operation prior to the acceptance of the Ottawa agreement. The Minister now tells us very definitely that if the duties recommended by the Tariff Board after further inquiry are identical with the rates now proposed, this Parliament will be impotent to provide the degree of protection which I consider this industry deserves. I desire the industry to be adequately protected, and as I consider that a duty of 15 per cent., British preferential, is inadequate, I propose to leave the question an open one, and accordingly, I will follow a course different from that which I had indicated to the Minister.
– Reference has been made during this debate to the protective incidence of the exchange rate of 25 per cent. It seems to me that very few new ideas have been enunciated during this discussion with the object of protecting our industries. The honorable member for Watson (Mr. Jennings) alone has expressed any really new views on the subject. In seeking equity through the medium of the much referred to “ reasonable competitive facilities “ no honorable member has suggested the obvious course - the adoption by Australia of a complete economic planning scheme, as is being done in England, under which English factories and staffs could operate here and thereby provide activities for an increased population. If the planning scheme were adopted much “ tariff item “ discussion, which has become threadbare through the years, couldbe divorced from Parliament.
– Order ! The honorable member must confine his remarks to the specific item before the Chair.
– In the course of this discussion many honorable members have wandered far from their real fiscal convictions. If importations are allowed without restriction, there can be no doubt that important Australian industries will be adversely affected, an undesirable degree of confusion will be imparted into our commercial and industrial operations, and in a few channels there will be created a dangerous false prosperity. Although I realize the wisdom of a remark which the great Bismarck made in regard to England, to the effect that speech is silver and silence is golden, [ wish to alter the completion of his remark to read, “ but to say one thing and mean another is parliamentary metal,” and to offer one suggestion to the committee in regard to the exchange situation.
– The honorable member will not be in order in embarking upon a general discussion on the effect of the exchange rate. He must confine his remarks to the specific item before the Chair.
– I submit that we must bear in mind, in discussing this item, three classes of Australian industries. These are the industries established prior to the imposition of the exchange rate, the industries established since that time, and new industries for which support is now desired. The industries which were established before the high exchange rate came into operation should not need additional protection, for this was really a gift to those competing with importers. The industries established since that time are entitled to the protection of the exchange rate, and we should admire the pluck of those engaged in them for having sought to establish themselves under such conditions; but they did so because they had confidence that the exchange would fall slowly, if at all. The industry which we are now considering comes within the third category. I submit that we should do everything in our power to establish new industries in this country, but at the same time obviating undue profits. There is safety in protection and danger in freetrade. We should give protection to this particular industry. We should build it up, and not crucify it.
– I pleaded with the Minister to give this matter further consideration. I asked him for an assurance that he would refer the item back to the Tariff Board, and also that imported articles would be branded clearly with the country of origin, and said that if he gave that assurance, I would support the Government. As the Minister gave that assurance, I shall fulfill my undertaking.
– The honorable member is inconsistent.
– I am not. The Minister gave me the assurance I asked for, therefore, I propose to support him, and I am not going back on my word merely because of some supposed fear.
– The honorable member said earlier that the case put up by the Opposition is unanswerable.
– The case put up by the honorable member for Parramatta (Sir Frederick Stewart) is amazing; he expressed two distinctly opposite opinions. First, he suggested that the Minister would refer the item back to the Tariff Board, because he knew it would give him the answer he desired, and then he said that that action might render the committee impotent to increase the rate of duty. He said he was not prepared to take the risk. Obviously, he doubted the Minister’s integrity, or he saw that the Minister was dissatisfied and wanted a further investigation. I have no wish to impute such motives to the Minister, and having received my assurance I shall support the Government.
Motion (by Mr. White) put -
That progress be reported.
The committee divided. (Chairman - Mr. Prowse.)
Majority . . 3
Question so resolved in the negative.
Amendment - by leave - withdrawn.
Question - That the item be agreed to - put. The committee divided. ( Chairman - Mr. Prowse.)
Majority . . . . 5
Question so resolved in the negative.
Motion (by Mr. Archdale Parkhill) proposed -
That the House do now adjourn.
– I desire briefly to bring under the notice of the Minister representing the Acting Attorney-General (Mr. Hughes) the manner in which the allocation of work on the waterfront has been made during this year. This matter is of great importance to the waterside workers in my electorate. When the licensing system was first instituted a compact was entered into between the Navigation Department, representing the Government, the shipowners and the waterside workers, under which it was proposed to avoid an unnecessary surplus of labour by restricting the number of licences issued to waterside workers to a number sufficient to meet the requirements of the Port of Melbourne. An allocation committee was set up, to which a representative of the CommonwealthGovernment was appointed. Licences subsequently issued were stamped first and second preference. First preference licences were granted to those waterside workers who were regarded as the real volunteers who came to the rescue of the Government during the well known waterside dispute in 1927. Second preference licences were issued to members of the Waterside Workers Federation. It was understood at that time, that men in possession of first preference licences would be given preference in engagement when work was available, and that men possessing second preference licences would be employed after the list of first preference licence holders had been exhausted. That arrangement operated more or less satisfactorily until 1933, when all licences were stamped first preference. From then on it was thought that before any fresh licences would be issued, all the men holding existing licences would be absorbed. Recently, owing to a boom in shipping in the Port of Melbourne, an apparent shortage of labour was experienced for two or three days, due not to an insufficient number of licences having been issued, but to the number of pick-up places having been increased. The men were spread all round the waterfront, so it was impossible to congregate quickly at one particular place where a large number were required. The shortage of labour was only apparent and not real. Since then the men have organized their forces at more central places, and now there is always plenty of labour available. Despite this re-organization, the ship-owners have taken advantage of the apparent shortage of labour, and on one day last week, no fewer than 150 new licences were issued to men, many of whom had never before worked in the industry. All these new men have had first preference stamped upon their licences and they are being picked up, whilst scores of older men who have been working in the industry all their lives - some of them original volunteers as well as federation members’ - have not been given a chance to be picked up. This is a complete violation of the understanding. I think that the Minister for Repatriation (Mr. Hughes) will agree that both the Waterside Workers Federation members and licenced volunteers have played the game since the licensing system came into operation; there has been no difficulty whatever. They complain now that they are not getting a fair share of the work. Because this surplus labour is available, older men are being pushed aside. Many members of the Waterside Workers Federation who have never done any other work in their lives are being stood aside and preference is being given to new men who have never before worked in the industry. There is another phase of this trouble to which I direct attention. Latterly, members of the Waterside Workers Federation have been called upon to show reason why their licences should not be cancelled, not because they have violated any of the conditions under which licences were issued to them, but because they cannot prove that they have earned 30s. a week over the last six months. This operates most unfairly in many cases. Some of these men are getting on in life and whilst they may not be able to do the heavier work, they could work on the winches and hatches, and many of them would be experts in other places if they were given the opportunity. This treatment of them has given rise to an anomaly. If they cannot prove that they have earned 30s. a week for the last six months, they are required to surrender their licences, and if they apply for the old-age pension they are unsuccessful because, in some cases, they earn more than the law allows for pensioners. But they do not wish to become old-age pensioners. Their desire is to continue working on the wharves; but if they are forced out they must then rely on the pension. fund. I hope that the Minister will call for a report from his representative, the navigation officer, and ascertain why these surplus men have been brought into the industry. If something is not done we shall have, in the approaching winter season, as we had before the licensing system was adopted, 500 or 600 surplus men hanging about the wharves waiting to be picked up. Like the men to be seen at the London docks, they will be scrambling to get a few hours work. My complaint is that the issue of new licences to men who have never before worked in the industry is a violation of the agreement. I hope that the Minister will take action to prevent the issue of further licences, and also see that those who are holders of licences, or who are old members of the industry, are given the preference to which they are entitled under the compact I leave the matter there, and hope that justice will be done.
– I should not have detained the House but for the fact that the matter to which I desire to refer calls for immediate action by the Department of the Interior. I have been advised that a firm of painting contractors in the Federal Capital Territory, Thompson and Layman, has failed to meet the wages due to its employees, and also that it has ceased work which it had undertaken to carry out for the Government. This firm paid wages weekly, but on the 20th March, the men were informed that, in future, wages would be paid each fortnight. At 9.15 a.m. on the 27th March Mr. Storey, the secretary of the Operative Painters and Decorators Union in Canberra, interviewed the senior partner, Mr. Thompson, who advised him that he would pay the men that afternoon, and made an appointment for 3 o’clock. Thompson did not keep the appointment, and since that time Mr. Storey has failed to make contact with either of the principals. The firm left the job on the 30th March, stating that the Department of the Interior had taken over the work. The department declares that it has not done this, and that it still regards the firm as the accredited contractors. The total amount of wages owing to the men is £76 2s.10d. and the total amount due to the contractors by the department for the job if, and when completed, is £65, plus £10 deposit. I am not in a position to say whether the work has been completed to the stage which would warrant the department in making this payment. It is believed that an advance to pay wages was made to the contractors on the 20th March, but the amount of advance, £20, was used for other purposes. Mr. Storey has requested the department to withhold any further payments. I shall be glad if the Minister will give this matter his immediate attention, and see if it is possible under the terms of the contract to pay the wages of the men involved. This incident touches the wisdom of letting contracts at prices which may he so low as to make probable default by contractors, and suggests the advisability of more careful scrutiny by the department of future contracts. It is believed that a similar set of circumstances is likely to arise in connexion with another contract, which I do not wish to discuss at this stage. I feel sure that the Minister would not tolerate an arrangement by which the workers were robbed of their wages. I ask the Acting Leader of the House (Mr. Parkhill) to be good enough to investigate this matter and see if some corrective action can be taken.
– I listened with very great interest to the remarks of the honorable member for Melbourne Ports (Mr. Holloway). Naturally I appreciate the position in which members of the Waterside Workers Federation find themselves. I shall bring the matter before my colleague, the Acting AttorneyGeneral (Senator Brennan), and shall also look into it myself to see what action may be taken.
. -The Minister for the Interior (Mr. Paterson) is unavoidably absent to-day. I listened attentively to the remarks of the honorable member for West Sydney (Mr. Beasley), and shall take up the matter with the Department of the Interior to-morrow to see what may be done in regard to it. A review of the facts presented by the honorable member will necessarily be involved. The Minister will be obliged, of course, to hear the department’s side of the case. The honorable member may rest assured, however, that the matter will be promptly and fully investigated.
Question resolved in the affirmative.
House adjourned at 11. 12 p.m.
The following answers to questions were circulated: -
– The answers to the honorable member’s questions are as follows : -
e. - On the 25th March, the honorable member for Echuca (Mr. McEwen) asked the following questions, upon notice: -
I am now able to furnish the honorable member with the following information : -
s. - On the 13th March, the honorable member for Newcastle (Mr. Watkins) asked me the following questions, upon notice: -
I am now in a position to furnish the following replies: -
Cite as: Australia, House of Representatives, Debates, 31 March 1936, viewed 22 October 2017, <http://historichansard.net/hofreps/1936/19360331_reps_14_149/>.