24th Parliament · 1st Session
Mr. SPEAKER (Hon. Sir John McLeay) took the chair at 2.30 p.m., and read prayers.
– I desire to ask a question of the Minister for Repatriation. In this year’s report of the Repatriation Department there is mention of payments made to British Commonwealth ex-servicemen now resident in Australia. On what basis are these payments made?
– It is quite an important function of my department to cater for the repatriation requirements of British Commonwealth ex-servicemen who are at present residing in Australia. In fact I think last year’s annual report mentioned that about £1,500,000 had been paid out for this group of people. Those involved are mainly from the United Kingdom, although there are some from Canada and New Zealand and some from European countries who became eligible under the repatriation conditions applying in the United Kingdom. We act merely as agents for the countries concerned, and we claim reimbursement from the authorities in those countries after payments have been made.
– My question is directed to the Postmaster-General. Has a firm of management consultants been called in to the Accounts Branch of the PostmasterGeneral’s Department in Melbourne? If so, what is the name of that firm? When was it called in? What is the purpose of its investigation? What have been the costs and the results of the investigation up to the present time?
– I think the honorable member is probably referring to the investigation firm of W. D. Scott and Company Proprietary Limited. Is that right?
– Well, that is up to you.
– I am merely asking whether that is the firm you have in mind.
– I asked you the question.
– I noticed something in the press during the last two or three weeks about this matter and naturally I made inquiries. This is a well-known firm which carries out investigations of various kinds and is frequently called on to give top-level reports on procedures followed in various instrumentalities. It is a most valuable organization. Some considerable time ago the Postmaster-General’s Department did use this firm to carry out a check, not because there was anything wrong but merely in pursuance of our aim always to provide the most efficient service that we can. I am glad to be able to tell the honorable member and other honorable members that on that occasion the department received a very favorable report from its investigators. When I saw the statement to which I have referred I made some inquiries and up until at least a fortnight ago the firm had not been called upon again.
– I ask a question of the Minister for External Affairs concerning the build-up of arms by Indonesia. Has the Minister any evidence to suggest that recent reports of additional deliveries of arms by Soviet Russia to Indonesia are well founded? If so, are those additional deliveries the outcome of agreements entered into before the recent settlement relating to West New Guinea? Has the Minister any information to suggest that subsequent to the settlement relating to West New Guinea the Indonesian Government has sought to increase further the strength of its armed forces by entering into fresh arrangements with Soviet Russia or with any other power?
– Reports of additional deliveries of arms to Indonesia from the Soviet Union are well founded. However, I think there has been some degree of exaggeration in the reports that I have read. Those deliveries were the outcome of arrangements made quite some time ago and before the settlement of the West New Guinea dispute. I have no evidence at all that Indonesia has sought to increase her armed complement by making any new arrangements or seeking any deliveries other than those that were arranged prior to the settlement. Indeed, Indonesian leaders have stated that they expect the settlement of the West New Guinea dispute to enable Indonesia to reduce expenditure on arms.
– Will the Prime Minister give the Parliament an opportunity to discuss the nature and the terms of reference of the committee which a leading spokesman of the Government yesterday said would be established by the Government to investigate and report upon the Australian economy?
– The honorable member, as is not infrequently the case, is ahead of me. I do not know the identity of the leading spokesman of the Government to whom he refers.
– I will give you a hint: He was a senator.
– Was he? On which side of the Senate does he sit?
– On the Government side.
– At an appropriate time I hope to make a statement on this matter. A statement relating to such an important matter should be available for debate by honorable members.
– Is the Minister for Trade aware of repeated statements made by the Deputy Leader of the Opposition that over the past ten years Australia should have been continually seeking markets for her products? Is it a fact that during that period the Department of Trade has been very successful not only in securing new markets but also in diversifying our export trade? Is it a fact that the Deputy Leader of the Opposition in 1957 voted against ratification of the spectacularly successful Japanese Trade Agreement-
-Order! The honorable member is now giving information. I suggest that he direct his question to the Minister.
– Is the Minister aware that the Deputy Leader of the Opposition is pledged to rescind the Japanese Trade Agreement at the first opportunity?
– The honorable member for Mallee has always interested himself greatly in this matter. It is a fact that the Deputy Leader of the Opposition, on a number of occasions recently, has alleged that the Government has neglected to intensify its export drive and failed to achieve diversification of exports. This, of course, is completely inconsistent with the facts. This Government, from the very day of its accession to office, engaged in policies designed to induce additional production of items suitable for export. In the expectation of increased production - which has eventuated - every possible step was taken to see that, as far as was achievable, profitable markets for the products to be exported were available.
Whereas, previously, Australia had had trade commissioners in only thirteen countries, to-day we have . fully equipped trade commissioner offices in 28 countries. In the last year that Labour was in office, £15,000 was provided in the Budget for overseas trade publicity. This year, approximately £840,000 is allocated in the Budget for this purpose. It is well known that this will attract from other sources at least £1,000,000 which will be spent by other parties concurrent with this Government’s own expenditure. It is known that there has been a succession of trade missions to Asia, Africa, North and South America and the Pacific Islands, that a succession of trade ships has been sent overseas and that very important tax incentives have been introduced by the Government and approved by the Parliament. These incentives are designed to promote the search for markets overseas and to increase the expectations of these markets when they are found. It is well known that this Government has succeeded in inducing shipping services to establish new lines to service Australian trade. On at least two occasions the Government has subsidized overseas shipping lines to service our trade. The Government has provided money to finance the Federal Exporters Oversea Transport Committee to enable it better to handle negotiations with overseas shipowners.
In short, the diversification that has been achieved with marked success may be recognized in just a few critical figures. Only about 13 per cent, of Australia’s total trade went to East and South-East Asia when we came to office. To-day, despite the obstructive efforts of the Australian Labour Party, trade with that vital market area represents, not 13 per cent., but 33 per cent, of Australia’s total trade. Prior to the advent of this Government, 5 per cent, of Australia’s trade went to the Pacific area and Africa. To-day, this trade represents 11 per cent, of the total. These figures show the successful diversification of trade. Exports of steel from this country-
Opposition Members. - Time! Time!
-Order! I ask honorable members to remain silent. This is question time and, in any event, interjections are out of order.
– I would have thought that members of the Labour Party would be interested in the exports of steel from Australia, because of the employment provided by the great steel industry and the associated coal industry. Exports of steel increased from £2,000,000 a year when we came to office to £38,000,000 last financial year. Exports of vehicles and parts rose from £1,000,000 to £9,000,000 a year.
– On a point of order, Mr. Speaker: I ask you whether a question has been asked without notice and whether, in fact, the Minister, in making his reply, has been referring constantly to written headings and notes that he held on the despatch box.
– Order! The question was in order to a certain degree, and the honorable member for Mallee properly directed it. The Minister has the right to reply in his own way.
– Exports of petroleum products from this country increased from £1,000,000 a year when we took office to £22,000,000 last financial year. Exports of machinery increased from £7,000,000 to £17,000,000 last financial year.
– Mr. Speaker, T rise to order. Would not the debate on the estimates for the Department of Trade be a more suitable occasion for the Minister’s reply?
– Order! There is no substance in the point of order.
– I sympathize with the Labour Party because my remarks make very unpalatable hearing, but, unpalatable as they may be for the Labour Party, they are good news for the Australian people. When Labour was in office exports of coal from Australia were nil; last year coal exports earned £13,000,000. When Labour was in office our exports of beef to the United States of America amounted to £47,000; last year they earned £46,000,000. If this is not a diversity of exports, what is? And there will be additional diversification in the export of iron ore, bauxite and steel! In short, this Government’s policies in relation to the diversification of exports have been successful to a greater degree than has been the case in any other country.
– My question to the Minister for Trade is without notice. On 15th August last 1 directed a question to him relating to the then recent decision of the New Zealand Government to lower the tariff on all imported steel, to reduced freight rates on the Japan to New Zealand run, and to the impact of this upon Australia’s steel trade with New Zealand. He replied that the matter was receiving attention. I now ask whether the Minister can confirm reports that the freight rate from Newcastle to New Zealand is £8 2s. 6d. a ton as compared with the rate from Japan to New Zealand of £4 8s. a ton. Have Australia’s exports of steel to New Zealand slumped badly recently?
– It is true that Australia’s exports of steel to New Zealand have fallen because of competition, principally from Japanese steel. The Japanese steel industry has been experiencing a recession. The freight, of course, is a significant aspect. I do not know whether the honorable gentleman’s question implies that Austraiian steel shippers should hire Japanese vessels on account of the lower freights. That is the logical conclusion to be drawn from it.
– Has the Minister for External Affairs read the complaint submitted on 25th September last by the West
German authorities to the Commission on Human Rights of the United Nations concerning violations of human rights since the erection of the Berlin wall, and setting out grim details of the barbarous and inhuman treatment being meted out by the Communists in East Germany to men, women and children who, in desperation, attempt to escape over the wall to freedom? Is everything possible being done by Australia’s representatives at the United Nations to support the West German appeal to the conscience of the world in the hope that this inhuman state of affairs will be eliminated?
– I share with the honorable member the repugnance which I am sure he feels at the events which have taken place at the wall which divides West and East Berlin. I understand that to be the mainspring of his question. I have no information as to an official complaint by any West German authority to the Commission on Human Rights but I have seen an unofficial complaint to that commission. The procedure is for that complaint to be sent to the governments concerned for comment and later for it to be placed before the commission. However, there will be no opportunity for any debate on the complaint before the commission.
The honorable member asked me whether we are doing what we can in relation to this matter. No doubt he will have observed that I made a point of this matter in my address to the General Assembly of the United Nations and that I made a point of it here during the relevant debate. For my part, I shall not cease to direct attention to the barbarity with which people are being treated at the wall.
– Although this question is at short notice, I wish to ask the Minister for the Interior whether he is in a position to give the detailed results of the auction sale of residential leases which was held in Canberra this morning, both as to the restricted auction and the open auction. Is it true that premiums paid for residential leases in Red Hill and Narrabundah have reached record heights? Is there any indication that the Government, through the National Capital Development Commission, is approaching the day on which it will be able to offer sufficient residential sites to meet the demand?
– I have not any figures from this morning’s auction. The honorable member agrees that he has asked his question at rather short notice. I shall have the figures by to-morrow at the latest and I will let him have them. The policy of the National Capital Development Commission is to throw open increasing numbers of blocks for private purchasers. I do not know when saturation point will be reached but we hope that we shall make more blocks available each year for the public to buy.
– I ask the Minister for External Affairs whether, in the giving of Colombo Plan aid, the expenditure on arms by the recipient nation is taken into account.
– In answer to the honorable gentleman, let me say that Colombo Plan aid is given without respect to political considerations of any kind. Its object is to assist people. No account has been taken of the policies being followed by the nations to which aid has been given in the respects which the honorable member mentioned.
– Is the Treasurer aware that the lord mayors of six capital cities met in conference in Sydney last week? Also, is he aware that the most important discussion at the conference concerned the Commonwealth Government’s failure to pay rates to municipal councils or to make any grants in lieu of rates on government-owned buildings? Furthermore, is the Treasurer aware that the Commonwealth banks, which do not admit liability, pay an amount equal to rates assessed? The Sydney quota for Commonwealth Government properties is approximately £150,000, which, if paid by this Government, would help to house age and invalid pensioners in Sydney.
– I have seen newspaper references to the activities referred to by the honorable gentleman. At an earlier point of time I received a visit from representatives of the capital city lord mayoralties when some of these matters were discussed. In stating that the Commonwealth does not pay rates, the honorable member has put the position much too broadly. The Commonwealth does make appropriate payments to municipal governments in various situations and details of them have been supplied to honorable gentlemen from time to time. State governments, of course, refrain from paying rates in respect of buildings which they occupy. I can appreciate the financial difficulties which municipalities and other local government authorities face in this country. Indeed, for some time now, recognizing that these authorities function inside the jurisdiction of the State governments, this Commonwealth Government has indicated a willingness to meet representatives of municipal and shire organizations in conference, providing that the State governments concurred, in order to discuss their overall financial problems. The last occasion on which I mentioned this publicly was in the presence of the Minister for Local Government in New South Wales, who informed the same meeting that the conference of the State Ministers for local government had, about that time, unanimously decided not to join in any such conference. So far as the Commonwealth Government is concerned, that is where the matter rests at present.
– I address a question to the Minister for Immigration. My question is supplementary to a matter I raised in this chamber in April of this year dealing with the shortage of medical practitioners, particularly in country areas. Is the Minister aware that the Victorian Government has promised to investigate the possibility of obtaining doctors from overseas because of this grave shortage? Is the Minister in a position to inform the House whether, the policy of the Government to continue to encourage qualified professional men to come to our country is having the desired effect?
– I am aware of what the honorable gentleman has said about the action taken by the Victorian Government. I am afraid I cannot give him any more detailed information than I did when, some months ago, the honorable member raised this point at question time. I am well aware that there is, in some parts, a shortage of doctors and dentists, and indeed when I was abroad in May, June and the beginning of July of this year, in every country I went to I pointed out the employment and vocational opportunities in Australia for people in these categories. I can assure my honorable friend, because I know he is very interested in and has personal experience of the hardships caused by this problem, that this is the last thing I am forgetful of in our quest for migrants to Australia.
– My question is addressed to the Minister for Territories. Can the Minister inform the House of the most recent developments in the Northern Territory concerning bauxite, iron ore and phosphate deposits? Has the work carried out by the Mines Branch, the Bureau of Mineral Resources and private interests proved that workable deposits of these minerals exist? If developments are favorable, what action is being taken to exploit these deposits, on a commercial basis, by the interests holding the mining rights over them?
– The honorable member for the Northern Territory referred to three minerals. In the current Budget we have quite a useful sum - I forget the exact amount - for special mineral investigations during the current year into the nature of the phosphate deposits, their extent, and the possibility of extracting the phosphate. I understand that they do present a very considerable problem of extraction. No mining rights of any kind have been given in respect of the phosphate deposits.
The position regarding bauxite is that two leases are held in respect of the deposits in Arnhem Land on the Gove Peninsula, one by British Aluminium and the other by Duval Holdings. Both of the rights are subject to certain stipulations regarding the presenting to the Government of proposals for future development. Both companies are due to present their proposals within a matter of a few months from now, and when the Government receives these proposals from either of these companies it will decide what steps shall next be taken.
In respect of the iron ore deposits, the major point of interest concerns the Frances
Creek deposits near Burrundie. Some rights are held in respect of them, and I understand that those who hold the rights are in negotiation with overseas interests to investigate the possibility of finding a market for the sale of ore. At the same time, officers of the Northern Territory Administration, of the Department of Territories and of the Commonwealth Railways are assisting them with discussions on the costs of extraction, cartage, and, in particular, loading at the Darwin wharf. Until such time as a purchaser for the iron ore is found I do not think the deposits will be worked. Of course, there are many people in many parts of Australia trying to sell iron ore at the moment, but until such time as a purchaser is found there will be, I assume, no development at Burrundie.
– I direct a question to the Treasurer. Will he consider having a review made of the Commonwealth Employees’ Compensation Act, directed to two aspects, first, a possible lifting of the rates of payment for individual specified disabilities and, secondly, a review of the substantive sections of the act to see whether there are any anomalies which could be eliminated?
– I should be glad to give consideration to what has been put to me by the honorable member. The Commonwealth Government has, over recent years, from time to time reviewed this legislation and has made changes in its terms. We have to keep before us the legislation of the State governments as well, because I think it is generally recognized that, so far as is practicable, there should be reasonable uniformity of treatment of these matters among the various governments in this Commonwealth. I know that the honorable gentleman has given a lot of thought to the problems arising from this legislation and I would welcome any suggestions or assistance that he might give to our own thinking on this matter if he cares to make his views known to me.
– My question is addressed to the Treasurer. A week ago my colleague, the honorable member for Scullin, asked a number of questions dealing with the large annual payments made by Aus tralian manufacturers for licences to produce goods of overseas design. The right honorable gentleman promised to make inquiries and to send the honorable member a reply. When does the Treasurer expect to be in a position to give the information desired on this very important matter?
– 1 regret that I have not that information immediately by me, but I shall see whether I can give some indication to-morrow of where the inquiry stands.
– I address a question to the Minister for Territories. Has his attention been directed to the regular television programme on ABV Channel 2, known as “ Four Corners “, the commentator being Michael Charlton? Last week-end the feature depicted “ Life in Papua and New Guinea “. Can the Minister tell the House his personal opinion of this particular showing?
-Order! The honorable member is not in order in seeking an expression of opinion from the Minister.
– I should like to reply to the question, Mr. Speaker.
– The question as asked was not in order. The honorable member for Ballaarat may re-phrase the last portion of it.
– Does the Minister agree with what was depicted?
– The main reason why I am eager to reply to the question is to apologize to the honorable member and the House for the fact that I have not yet formed the habit of looking at television, nor do I even feel the attraction of it. So I did not see this programme. Perhaps I should say that both after the programme was presented for the first time about a month ago and since Monday night, a number of people with a knowledge of the Territory have expressed extreme dissatisfaction with the programme. I do not know whether their opinion is well founded or not, because I have not seen the programme. I gathered that the ground for dissatisfaction was that these people thought the programme was not truly representative of the Territory and gave a wrong impression. As I say, I have not seen the programme, nor am I greatly concerned about it because, as perhaps the honorable member for West Sydney would agree, the picture that any popular entertainer presents oh a serious subject, such as stage Irishmen, is seldom a very exact one.
– I direct a question to the Prime Minister. It relates to what has been called the new proposals to be put forward by the Prime Minister of Great Britain to the European Economic Community conference in October. I ask him: Is he aware of the content of those proposals? Do they involve the re-opening of any matters already decided or are they really confined to the rate of phasing-out of existing preferences? Will he say clearly whether those proposals are sufficient to safeguard the interests of the Commonwealth, which the British and Australian governments have always said are essential? If they are not, does he propose to take any action in relation to the matter?
– All I have seen or read about this statement by the British Prime Minister indicates that his document follows very largely the same lines as the speech he made in opening the conference in London. I do not think that it contains any specific proposals of a new kind. lt exhibits the same general attitude as he put to us in London. As to that general attitude, I will take the opportunity, I hope on Tuesday night next, of making a statement, and of discussing the whole matter as closely as I can for the benefit of the members of this House.
– Can the Minister for Air advise me how far the re-organization for the introduction of the electronic data processing computer, known as the E.D.P. computer, has progressed in the Royal Australian Air Force? Has there been any recent contact by his department with the United States Air Force in order to investigate any problems that the Americans may be experiencing with this system?
– Installation of the E.D.P. computer is a project which is being carried out by the Department of Defence, and my department is particularly interested in it because we are to be the first service department to use it. I understand that the computer room is already occupied, and that next year the R.A.A.F. will be taking it over. We have had a team recently in the United States of America whose members have returned with a considerable amount of knowledge on this subject and have carried out work here. I understand from what I have been told that the computer will be of considerable use to the R.A.A.F. I can tell the honorable member that, for example, whereas at the present moment it takes us something like 12,000 man-hours over a period of a fortnight to compute the pay of the R.A.A.F., once this computer is i-j operation four men, in about 80 minutes’ work, will do the same job. We believe that the use of the computer will reduce enormously the demands on clerical staff in the R.A.A.F. and will make probably about 300 airmen available for operational work.
– I ask the Treasurer: In view of the great concern regarding the future of Australia’s primary industries and the possible loss of overseas markets, why does the Government persist in its rejection of the widespread pleas for the elimination of sales tax on certain foodstuffs, the primary produce content of which is estimated to be valued at about £35,000,000 annually? Will he agree that the abolition of such sales tax could substantially boost local consumption of those products and stimulate both local primary and secondary production and employment?
– I think that all honorable members are aware that sales tax is retained on a relatively small group of processed foodstuffs which can hardly be described as being in the essential foodstuffs class. I remind the honorable gentleman that it is this Parliament which has determined upon the collection of revenue from that source and that if that revenue were not so collected we would have to look to other forms of taxation for a corresponding amount. In any event, the matter raised is one of policy which is reviewed from time to time as we prepare the budget for the ensuing period. The Government’s proposals for this financial year have already been announced in the Budget introduced recently.
– I address a question to the Minister for Labour and National Service. Having in mind the increase in the overall number of wage and salary earners in employment, will the Minister inform us of the increase in the number employed in manufacturing industries?
– There was a substantial increase between August of last year and August this year in the number of wage and salary earners employed in the Commonwealth. I think the increase was about 82.000. In addition to those employees, Sir, we have other workers, such as people self-employed, employees in the rural industries and people in domestic employment. I think the total increase in the numbers employed would be of the order of 100,000 between August of last year and August this year. That. Sir, is a remarkable improvement and speaks volumes for the Government’s economic policies. The honorable member asked about the increase in manufacturing industries. I think the increase was a little over 59.000, or perhaps as much as 60.000. Again this was a healthy increase, and if 1 may be allowed to repeat myself, it does reflect credit on the Government’s economic and financial policies.
– I desire to ask the Minister for Immigration a question. Is it a fact that the honorable gentleman, during his recent tour of Europe recruiting more immigrants for Australia, emphasized Australia’s special need of young single girls? Is it a fact that the Minister was spoken of by French girls as being a very handsome man? If this is so, would the honorable gentleman tell those girls that there are many handsome bachelors in Australia eager for the joys of wedlock, such as the Minister for Labour and National Service, the honorable member for Griffith, the honorable member for Brisbane and the honorable member for Evans?
– Tt is quite true that when I was abroad, for a variety of purposes, one of the problems to which I addressed my mind was that of the imbalance of the sexes among immigrants, to which honorable members have often referred in this House. Naturally, therefore, in the countries I visited I made a special plea for girls to migrate, so that this problem could be overcome. I might say that in doing so, and speaking now as, I hope, a loyal House of Representatives man, the last thing that I would have wished to do would be to forget the needs of some of my colleagues. All I can hope is that my efforts will prove successful, and that my friends on both sides of the House will be very happy in the future.
– My question is addressed to the Minister for Labour and National Service. I refer to a recent statement by the President of the Commonwealth Conciliation and Arbitration Commission, Sir Richard Kirby, that he would like to see a meeting called of representatives of employers and employees, perhaps under the chairmanship of the Minister himself, to consider the very important matter of training for industry. Has any progress been made towards bringing the parties together, and is there likely to be such a conference under the Minister’s chairmanship?
– After I received a letter from the President of the Commonwealth Conciliation and Arbitration Commission, I instructed my department to call together representatives of industry and of the trade unions to see what could be done about the President’s request. A meeting was held - a pretty representative meeting, too - and it was decided that we should concentrate on the technical education of people under the age of 21. It was considered that the problem extended beyond apprenticeship and right through the technical trades. It was also decided that we should take one industry at a time. I have written to the President of the commission informing him of the results of the discussions, and letters have been written to the ministries of labour in the various States, informing them that the first conference will deal with the metal industries and the electrical industry. I hope that the first conference will be held during the next few weeks.
Motion (by Sir Garfield Barwick) agreed to-
That Government Business shall take precedence over general business to-morrow.
In Committee of Ways and Means:
Customs Tariff Amendment (No. 21)
Consideration resumed from 2nd May (vide page 1833), on motion by Mr. Fairhall-
That the Schedule to the Customs Tariff 1933-1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals . . . (vide page 1832).
– Is it the wish of the committee that the motion be considered as a whole? There being no objection, that course will be followed.
– Mr. Chairman, this afternoon the committee will have before it for discussion some 21 proposals to amend the Customs Tariff 1933-1962 and the preferential tariff proposals directly associated therewith. As each proposal is called on I thought it might be helpful to honorable members if I outlined very briefly the subjects covered by it. I will also suggest to the committee that where a preferential tariff proposal is also relevant to the main proposal, consideration of the preferential tariff proposal be included.
I remind honorable members that all documents were distributed at the time the proposals were tabled but additional copies of the documents are available from the floor of the chamber. As I have said, the committee will be discussing 21 proposals, some of which refer to two or three items. It is not suggested that the proposals be grouped, but it is suggested that in considering the 21 individual resolutions we will have time to deal with their component parts. The proposal now before the committee is Customs Tariff Proposals No. 21. These proposals followed a recommendation by a Special Advisory Authority for additional temporary duties on the basic forms of polyvinyl chloride. An examination of the needs of the industry on a long- term basis is at present with the Tariff Board. I commend the proposals.
.- The Labour Party offers no opposition to these proposals. Before I proceed to deal with the wide range of tariff proposals now before us I feel bound to say that in my opinion the Parliament is being treated very shabbily indeed in the way these proposals are brought forward. The proposal dealing with polyvinyl chloride came before the Parliament on 2nd May this year. The tariff is actually operating and this Parliament is expected on 10th October to discuss the merits of the tariff and to support or reject the proposal. But that is not all. The Government has no consistent policy concerning Tariff Board recommendations. As I have said, the proposal immediately before the committee first came before us on 2nd May last but the Government also intends that we shall discuss a tariff proposal introduced on 2nd October. In one case a long period of months has elapsed before discussion takes place and in the other case only a few days have elapsed.
The time is long overdue for this Parliament to lay down a policy in respect of Tariff Board proposals which would enable the Parliament to discuss a proposal already in operation within one month or six weeks of its operating date. If that had been done with the proposals that are now coming before us honorable members would have been able to retain some knowledge of the proposals. In the case of new proposals, such as that introduced on 2nd October, we would have sufficient time to inform our minds on them.
Let me illustrate the stupidity of the present method of dealing with tariff proposals. On 4th October, the Government introduced a series of proposals which immediately became operative. Those proposals dealt with, among other things, textiles and woollen piece goods. Manufacturers of those articles have lodged protests, with the result that those proposals, which until to-day were listed on the noticepaper, have been dropped from the noticepaper. I am referring to proposals Nos. 42 to 49. The situation is that although the tariff has been operating for about a week, the Government has had fresh thoughts about it. The Government has removed the proposals from the noticepaper, denying honorable members an opportunity to discuss them. Perhaps the Minister for Supply (Mr. Fairhall) will indicate that in view of the protests that have been made against those proposals, the Government will seek to have the matter further considered by the Special Advisory Authority. I think such a course may be necessary, but, be that as it may, the situation highlights the fact that the Government does not have the faintest idea of the likely effect of the operation of its proposals. I dare say that the Minister does not have the faintest idea what the proposals mean. The situation demands, as was suggested in to-day’s or yesterday’s press, a vigorous protest from manufacturers, whose interests are endangered, and from trade unionists, whose employment is endangered. If that were done, the Government would be well aware of the likely effect of its proposals on manufacturers and on the workers. Apparently the Government has no knowledge in this regard.
– To which proposals are you referring?
– Proposals Nos. 42 to 49. As matters now stand, manufacturers, wholesalers, importers and potential importers have no idea what the Government intends to do. I have demonstrated how scant is the consideration given by the Government to this matter. The situation that exists to-day highlights the ineptitude of this Government. To-day, we were to be asked to consider proposals introduced as long ago as 2nd May and as recently as 4th October, but the Government, having heard that the latter proposal is unpopular, and not having fully digested the report of the Tariff Board, has removed that proposal from the notice-paper. What are we to do in those circumstances? On behalf of the Opposition I lodge a most emphatic protest at this bad practice that the Government has adopted of treating tariff proposals with such scant consideration.
To-day, Australia is threatened by the impact of Britain’s joining the European Common Market. If and when Britain joins the Common Market our primary industries, and indirectly our secondary industries, will be adversely affected, if not seriously imperilled. The Parliament is not given adequate opportunity to consider these proposals. The Labour Party is a protectionist party. The Opposition will always, unless good cause is shown, oppose reductions in tariff on goods imported into this country to compete with similar goods manufactured here. We will always support increases in tariff in such cases. By that means we hope to stimulate employment in Australia. We hope, also, to stimulate manufacturing industry and to strengthen our economy. I have no illusions about the effect on consumers of tariff walls. I have no illusions about legislation that will result ultimately in increasing prices to Australian consumers. Nevertheless, our main endeavour must be to ensure that every person in this country who is able and willing to work is given an opportunity to do so.
I now return to deal with the proposal before the committee. 1 acknowledge at once the indulgence that you, Mr. Chairman, have granted to me. We offer no objection to Tariff Proposals No. 21, which were introduced on 2nd May last. Those proposals are designed to provide a greater measure of protection for vinyl chloride polymers and copolymers, slide viewers and projectors, and continuous man-made fibre yarns.
– We know something of continuous man-made yarns.
– This Government is the top-notch spinner of man-made yarns. Unless any other member of the party for which I speak has any objection to these first proposals, 1 can say that we are prepared to let them go through.
.- Mr. Chairman, first, I say that I regret the necessity to have to insist on my right to take this series of Tariff Proposals individually. I realize that this is a break with tradition. However, the honorable member for Lalor (Mr. Pollard) has often reminded us that a tariff is a tax, and I think it is proper that members of the Parliament take an interest, even though it be perhaps a somewhat morbid one, in the effect of such a tax. I should like to follow the example set by the honorable member and make a few general remarks before dealing directly with Tariff Proposals No. 21. My general remarks apply to these proposals as well as to most of the rest.
Most of these Tariff Proposals that we shall discuss this afternoon emanate from reports made by the Special Advisory Authority whose appointment I so bitterly opposed earlier this year. Being so bitterly opposed to the new procedures, I have followed these reports with more than usual interest. As the debate proceeds, it will become apparent that I find many of them economically absurd. However, that is not the particular matter that I wish to discuss. One particular comment applies to the principle of these sliding-scale duties which have generally been adopted by the Special Advisory Authority in these and other proposals: The duty rises as the cost of the import falls, and falls as the cost of the import rises. The admitted reason for this is to prevent cheap imports from coming in. I shall not discuss the question of whether imports should be cheap, although I always think it is rather queer that when I, as a primary producer, would like access to cheap imports these are deliberately stopped. However, let us not look into that now. I should like to examine the philosophy behind these sliding-scale duties.
The Opposition and we on this side of the chamber have always disagreed about the philosophy of price-fixing. The fixing of prices suits their philosophy, but it does not suit ours. I shall not canvass the reasons at this stage. It seems queer to me that people on this side of politics have accepted so dumbly the principle of slidingscale duties, which are, in effect, another form of price-fixing. The only difference between these duties and price-fixing is that the duties, instead of fixing prices down, fix them up. The duties rise as the prices of imports fall, and fall as the prices of imports rise. The result is that prices rise to a given base level fixed arbitrarily by the Special Advisory Authority in many instances, and, if the recommended protection is effective, the price of the local product adjusts itself to this base level. I submit, Sir, that the principle of giving any one person the power so arbitrarily to fix the prices of goods up is dangerous, particularly when the prices are fixed after only a cursory examination. The Special Advisory
Authority, of course, has time to make only a cursory examination.
I am rather puzzled by the acquiescence of the Australian Labour Party in this. I understood that it was anxious to fix prices down. I did not understand that it was so willing to fix the prices of goods up. Furthermore, I congratulate those on this side of the chamber on their graceful acceptance of a principle that strikes directly at the root of our political philosophy.
One thing should be said about these sliding-scale duties in particular, Sir: They remove incentive. What happens is that techniques change overseas, manufacturers of polyvinyl chloride become better at the manufacturing process, and, as a result, the price of the product falls. But, because of the sliding-scale duty, which rises as the price of the import falls, the price in this country of the imported product comes up to the base price. So the impetus for the reduction of prices is gone. This, I say, removes the incentive for Australian producers to market their product more cheaply. They do not have to compete with imports, the prices of which are falling, because the prices of imports are jacked up.
Another feature of the activities of the Special Advisory Authority constituted under recent legislation is that disruption is caused when there is even a rumour of another inquiry. The rumour of an inquiry causes importers to reduce their ‘ imports, because they are frightened that the goods may land in their laps just at the time when duties are raised. I point out that many manufacturers go to some trouble to make it known that they are asking the Special Advisory Authority to hear a case.
Having voiced two particular criticisms about the sliding-scale duties and one about the disruption of trade, in making my general comments about all the Tariff Proposals that we shall discuss this afternoon, I now turn to Tariff Proposals No. 21, which deal, among other things, with polyvinyl chlorides. I am glad that these proposals are being taken first, Sir. Surely they are about as bad as proposals can be. One would not expect worse than these.
In September of last year, the Minister foi Trade (Mr. McEwen) tabled a report by the full Tariff Board on P.V.C. At that time, only one company in this country was making it. That company was our old friend, Imperial Chemical Industries of Australia and New Zealand Limited, which manufactured the basic P.V.C. material under the protection of a 40 per cent, mostfavourednation duty. Surely a duty at that rate was high enough to protect a product which is the basis of many usages in secondary industry. In the report of the full board, Sir Leslie Melville and Mr. Boyer recommended a duty of 6id. per lb., which, they considered, approximated the duty of 40 per cent. The other two members of the board which made this report presented a report in which they recommended a duty of 7id. per lb. The Government accepted the recommendation for a duty of 6)d. per lb., but, almost immediately, referred the matter to the Special Advisory Authority for another report. Only six months after the full Tariff Board had reported, Sir Frank Meere, the Special Advisory Authority, presented a one-page report. He did not even mention the volume of imports, but he stated -
I am firmly of the opinion that the local P.V.C. industry is in need of temporary assistance to enable it to operate efficiently and with an adequate return on funds invested. This latter aspect will necessitate some upward revision in the Industry’s price structure. . . .
He recommended temporary additional duty of 4id. per lb., making a total duty of lid. per lb., compared with the duty of 6id. per lb. recommended by two members of the full Tariff Board only six months before and the duty of 7±d. per lb. recommended by two other members of the board, which, many would say, erred on the side of generosity. The total duty of lid. per lb. represents almost 100 per cent, and will inevitably make P.V.C. very much dearer for those who use it in industry.
The price of polyvinyl chloride is 26d. per lb. in Australia, compared with 16.3d. in the United Kingdom, 17. Id. in the United States of America and 14. 6d. in Japan. The product is nearly twice as dear in Australia as in Japan. When I saw this, I sat back with grim amusement to see what would happen. I did not have long to wait. On 18th June last, the Minister for Trade referred to the Special Advisory
Authority the question of further protection for those industries that use P.V.C. I thought that Sir Frank Meere was at his best in his second report. I admit that his reports generally have been models of brevity. He makes no effort to disguise things which others would like to see hidden in a mass of verbiage. In fact, I have often thought that it is not for nothing that his name is Frank. But in this report he is at his best. Listen to this -
Such information as is available to me indicates that the industry is supplying an increasing proportion of the demand for goods of the types and classes which it manufactures. However, the industry maintains that its current sales volume has only been achieved by reducing its prices to levels more competitive with imports.
So in order to cure this Sir Frank recommended specific duties which approximate 22 per cent., thus giving a total protection of 66i per cent. It is clear that in these two cases the object of the exercise is not protection of industry but protection of income. I wish I could get Sir Frank interested in my farm. I can imagine him strolling around looking at my ricketty old fences and out-of-date buildings. Then I would ask him inside to have a look at my books and maybe I would offer him a cup of tea. Then he would read the report of the Bureau of Agricultural Economics and find that the average level of return on capital for wool-growers in my area is about 3 per cent. He would be so moved with compassion that I feel sure he would look after me in my adversity. I might suggest, in a mild aside, that one of the ways he could help would be to make the things I buy cheaper rather than dearer. But he must be a marvellous person to know.
I have digressed. Let us return to that fascinating subject, P.V.C. One would think that this last duty would be the end of the exercise. But of course it is not. With the ink hardly dry on its first report the Tariff Board is now conducting another inquiry into the same industry. In the debate which preceded the appointment of the Special Advisory Authority this year I mentioned that I could think of no quicker way to break the morale of the Tariff Board than to pass applications from the board to the Special Advisory Authority and from him back to the board again. I thought then that perhaps I was drawing rather a long bow, but I begin to wonder. I am beginning to think that this is a deliberate attempt to weaken the independence of the Tariff Board; if it is not a deliberate attempt it is having the same effect.
– I speak to this subject because whereas the Minister for Supply (Mr. Fairhall), who is in charge of the chamber at present, represents the Minister for Customs and Excise, I, as the Minister for Trade, have a responsibility for the Government’s policy of protection. While I cannot undertake to speak to every tariff proposal which will come before the committee - I do not think honorable members expect me to do so - I think that this is an appropriate occasion for me to offer some observations.
I listened with interest to the remarks of the honorable member for Wakefield (Mr. Kelly). His message seemed to be that if, in the absence of a tariff, a company operates at a loss, it should be left to operate at a loss. I am afraid that commerce is not like that. If it is government policy that a business shall operate at a loss, business discontinues. It lays off its employees and does the best it can with its investment. You cannot tell business that it shall operate at a loss. You can tell it that you do not want it to operate, but you cannot tell it that it is governmental policy that it shall operate at a loss. You cannot even tell this to one business because every other business in the land will begin to wonder what security it has and what the future holds for it.
If there is one over-riding policy consideration which the Australian people demand, I am sure it is that the country shall continue to grow, that there shall be a base for absorbing new population and that there shall be employment for new population. These things are inseparable from stable manufacturing industry. I say unhesitatingly that this Government’s policy is that there shall be stability in our manufacturing industry without which there cannot be stability of employment and assured prospects of growth. In making that statement I do not ignore the interests of the great primary industries for which I am a particular spokesman. I join with the honorable member for Wakefield in saying that they have to be enabled to survive also. But there is no future for this country if one sector of the economy is enabled to survive by deliberately destroying another sector. There must be an integrated growth of the economy.
In the fast-moving, international, cutthroat business world you cannot say that a decision taken to-day will not be changed. You cannot say that any such decision must stand for a substantial period irrespective of the circumstances which may develop. The item under discussion illustrates the fast-moving, if not the cut-throat, character of the competition in its manufacture. The industry concerned with this product first appeared before the Tariff Board as long ago as 1958 when it claimed that it was being harmed by dumping from Japanese sources. A Tariff Board inquiry was conducted but not for protectionist purposes because one of the functions of the Tariff Board is to ascertain whether dumping is being practised. The Tariff Board finding on this occasion was to the effect that on the evidence it was unable to say that dumping was occurring.
That decision having been taken the industry, quite within its rights - no new right but one that has existed in various forms for 40 years - appealed to the Government to have the Tariff Board conduct an inquiry into its claim for sufficient protection. So, a normal Tariff Board hearing took place. The honorable member for Wakefield has referred to it. By majority decision which the Government adopted - the Government usually accepts the Tariff Board’s recommendations although it is not bound to do so - the board recommended on 14th September, 1961, that a specific rate of duty of 6Jd. a lb. be applied. Within a year the industry was able to produce prima facie evidence that this protection was insufficient to enable it to survive against competition.
In accordance with the law which the Parliament had approved1 - it is notorious that not all of the Parliament approves all laws but in this case there was no division, if I remember rightly - the case was referred to the Special Advisory Authority. He is not a duplication of the Tariff Board. His function is not to do precisely what a full board of eight members and the whole mechanism of the Tariff Board machinery does with more leisure. His function is to ascertain whatever evidence is available and, within 30 days, to make a recommendation to the Government designed not to establish a permanent state of affairs but a holdtheline state of affairs if in his judgment this is necessary. He made certain recommendations. The honorable member for Wakefield has said that the Special Advisory Authority recommended a further increase in duty. That was approved by the Government, and the law requires that the matter automatically shall be referred back to the Tariff Board. That has been done and it is with the Tariff Board at present.
I take up with die honorable member for Wakefield his charge that to refer back to the Tariff Board a matter which had been before it a year or so previously is calculated to break the Tariff Board’s morale. The primary responsibility of this Parliament and of the Tariff Board is not to attend to the morale of the Tariff Board, lt is to attend to the well-being of the Australian economy. The duty of the Tariff Board is to respect the law which this Parliament passes. If this Parliament passes a law which clearly contemplates that in certain circumstances a matter shall be referred back to the Tariff Board, then there is no justification for representing the Government’s action in referring such a matter back to the Tariff Board as one calculated to destroy the morale of the board. I do not believe that the Tariff Board is such a tender plant as that. I hope it is not. It is a bad thing for the manufacturing industries and the primary industries of this country if the Tariff Board is as tender a plant as that. I do not believe it is.
The truth of this matter is that polyvinyl chloride is not the total production of this industry, but it is an important component of the industry in which £50,000,000 has been invested and in which hundreds of people are employed. If it turns out that a tariff which, at the time of fixing, the Tariff Board considered adequate, is not adequate, are we to say, “Too bad! We are not interested in the £50,000,000 invested. We are not interested in the employment of hundreds of people. The industry can close down if it likes because we are not going to put the Tariff Board to the inconvenience of a second hearing “? I do not think that such an attitude would represent Australian public thinking. It certainly does not represent the thinking of this Parliament. We are out to encourage the industrialization of this country, both primary and secondary, and to encourage its tertiary activities. There are certain industries, particularly those described as “ capital intensive “, in which everybody knows, as I am sure the honorable member for Wakefield knows, that to have the lowest achievable unit cost of production there must be a certain economic throughput. That is why it is essential, particularly in this type of industry, if we want it to survive, that there shall be some device of protection which ensures a certain economic through-put, otherwise there will be unbearably high unit costs. I hope that every one does want this industry to survive. One concern which I cannot name has stated that if the Government will take such a course to sustain its volume of through-put and its unit costs it will undertake not to raise its prices. This is not an airy-fairy story. This has been done and the promise has been honoured. I am sorry, but we cannot accept the proposition that because polyvinyl chloride can be produced in the United Kingdom or Japan for lower than the cost of production in Australia the industry ought not to exist in Australia or that it should be allowed to wither and fold up.
– I did not say that.
– The honorable member certainly implied it. However, I accept his statement that he did not say it. What he did say was that this second reference in a short period of time should not have taken place because it was damaging to the morale of the Tariff Board. The opportunity to preserve the through-put of this industry is by means of higher duties and quantitative restrictions - the theoretical alterations - or by a sliding scale of duties, lt was the judgment of the special advisory authority that the industry and the consumer would be best protected by the device which he recommended, which included the sliding scale of duties. I ask the committee to support the motion.
.- I have decided to support the Minister for Trade (Mr. McEwen). He has pointed out to the honorable member for Wakefield (Mr. Kelly) that high prices are not necessarily the result of the tariff. He has said that the tariff should not be attacked on the ground that it increases prices in the community. I believe, as the Minister pointed out, that there is a relationship between tariffs and the Department of Trade. The effectiveness of tariffs can be assured only if we have a desirable and effective trade policy. The honorable gentlemen who have spoken have considered the tariff in relation to prices and in relation to the promotion of industries in this country. They considered this question in a Very general manner. I, too, should like to make a few remarks in connexion with the tariff generally.
Tariffs are not securing the desired effect upon the industries of this country. In its recent report, the Tariff Board has pointed out that there is often excess, unused capacity in Australian industry. That is right. There is. Goods are pouring into this country in great quantities despite our tariffs and are being sold over the counters of vast emporiums throughout Australia. Why is that possible? It is possible because tariff protection is not enough. Tariffs must bc co-ordinated with trade activities in order to keep out of this country those goods that are destructive of Australian industry without diminishing prices to the consuming public. The absolute proof of that statement exists in the following facts: - The profit of David Jones Limited, of Sydney, was £1,807,000 last year. The company declared a dividend of 121 per cent. The profit was more than twice the amount of the dividend. Indeed, the firm could have declared a dividend of 25 per cent. The Myer Emporium Limited-
– Order! I suggest that the honorable member is getting a little away from the matter before the committee, which concerns Customs Tariff Proposals No. 21.
– I am trying to illustrate that imported goods are sold at an excessive profit, despite our tariff. The reason is obviously that the retailer is influenced to sell a commodity by the profit margin on it. If the profit margin on goods from Japan is greater than the profit margin on goods manufactured in, say, Fitzroy, in my electorate, the big emporium will press the sale of the commodities from Japan. Consequently, there is excess production capacity in the factories of Fitzroy because the goods that I desire to see sold are not sold.
– Cannot anybody import them?
– You are probably in favour of anybody importing them because you are in favour of the process by which they are pushed in the emporiums to the disadvantage of Australian products. I suggest to the Minister for Trade that if he acted in the best interests of consumers, manufacturers and workers he would see that this method of selling foreign products was not made easy. Mr. Chairman, that is what is causing an emporium in Melbourne to declare a dividend of 16$ per cent., which was only half its profit of over 34 per cent, for the year. Is that a desirable position in a community such as ours? Does the Government say, in the face of that, that it must remain inactive and cannot do anything through its tariff provisions or the Department of Trade to protect the industries of this country and to put to work the idle capacity of our factories and the 100,000 or so who are unemployed, at the same time giving to the Australian people a cheaper Australianmade product in place of the product made overseas? If the Government were to take such action the only sufferer in the community would be the person who received excessive dividends from emporiums such as David Jones Limited or Myers of Melbourne.
.- Mr. Chairman, the honorable member for Wakefield (Mr. Kelly) made a remark which I cannot allow to go unchallenged without at least drawing attention to it myself. He said, in reference to sliding-scale duties, that honorable members on this side of the chamber accept meekly proposals which strike at the very root of our political philosophy. 1 do not regard this as having been accepted meekly; on the contrary, I regard this as having been thought out very seriously and deeply by members on this side of the chamber. If there is to be any meek acceptance, I am not going to submit meekly to the honorable member for
Wakefield’s rebuke by remaining silent on the matter.
I regard the political philosophy to which I contribute as a political philosophy of protection for Australian industries, of full employment and, also, very importantly, of the maintenance of the private sector of our community in relation to the public sector. This is all I wish to say on this particular matter. I do not accept the suggestion of the honorable member for Wakefield that we, on this side, meekly accepted something which struck at the roots of our political philosophy. He was, at the time, I think, speaking specifically of sliding-scale duties, but I understand he rather implied that it went beyond just sliding-scale duties and intruded into the general consideration of the Special Advisory Authority. But even if it were confined solely to the sliding-scale duties, I rather see sliding-scale duties as standing, in some respects, as an alternative to quantitative restrictions; and it was around quantitative restrictions that the whole essence of the argument lay in the appointment of the Special Advisory Authority. The appointment of the Special Advisory Authority received the support of this Parliament; if my recollection is correct it was carried on the voices; and I certainly do not accept the rebuke that we accepted meekly something that has struck at the roots of our political philosophy.
.- Last Wednesday, I think, we were informed that to-day honorable members would be permitted to discuss certain tariff matters. I wish to refer in particular to the textile industry and to piecegoods made of manmade fibres.
– Mr. Chairman, I rise merely to apologize for a mistake I made in the haste of dealing with the honorable member’s question, in reply to which I said the item to which he referred would be discussed. I was in error in stating that; I had forgotten that it was not included in the list of proposals before the committee.
– In that event, Mr. Chairman, is it possible for honorable members and industry to be informed of when this matter can be discussed, as the Tariff Board report has already been brought down and is in operation in that sector of the textile industry? I have quite a few things that I want to say on this subject.
– This is not a matter for consideration at this particular time, of course. I suggest that when the estimates for the Departments of Trade, Customs and Excise and Primary Industry are before the committee at a later stage the honorable member may consider raising the matter he has mentioned. That is not a ruling from the Chair. It is merely a suggestion.
– Mr. Chairman, I suggest that an amending bill, rather than a bill for an act relating to customs duties, must be introduced at a later stage. At that stage, I think, there will be full opportunity for the honorable member to deal with the matter.
– I am in doubt about that; the bill would relate only to items that have been before the committee.
– A bill for an act relating to customs will have to be introduced at a later stage. At that time, I suggest, the honorable member may have the opportunity to discuss matters generally affecting the Australian tariff and the Tariff Board report.
– That is not a matter for the Chair of this Committee of Ways and Means. It should be left until the point does arise. The suggestion I made to the honorable member for St. George was purely something that might be helpful to him at a later stage.
.- Mr. Chairman, I do not wish to go into certain points that have been dealt with so adequately by the Minister for Trade (Mr. McEwen), but I think I am in order in asking you to give me permission to reply very briefly to the remarks of the honorable member for Scullin (Mr. Peters) regarding certain Japanese goods coming into this country, and which he claimed are being pushed for sale by retailers more strenuously than Australian-made goods on which the profit margin is not quite as good. He has suggested that the Department of Trade and the Tariff Board are more or less linked, and that the Department of Trade should co-operate with the Tariff Board in its operations.
The real position is that no country can always sell and never buy. I have no accurate details of the goods coming into this country that were referred to by the honorable member for Scullin, but, generally, I should say they would be goods coming from Japan, where Australia has a most favorable trade balance. Australia sells to Japan about three and one-half times as much in value as she buys from her. If the Department of Trade operated on the advice of the honorable member for Scullin and decided not to allow those goods into this country, Australia would not have Japan as a customer. Japan has been Australia’s best customer for many primary products.
The honorable member for Scullin made the point that because of some of the goods coming into Australia a certain amount of unemployment was created; or, to put it the other way, if the goods were not coming in more employment would be available. That may be so, but if Australia did not have a very satisfactory trade agreement with Japan and was not able to sell the vast amount of wool and other products to that country under that agreement, surely there would be more unemployment in this country than would be caused by allowing certain goods from Japan into Australia. I ask the honorable member: Is not everything in favour of Australia in the Japanese Trade Agreement, and is it not absolutely imperative that Australia should take a reasonable amount of Japanese goods so that we can sell to Japan a vast quantity of our primary products?
.- Mr. Chairman, in the course of this debate on the report of the special Tariff Advisory Authority on polyvinyl chloride resins and moulding compounds we have seen behaviour which, at one stage, one would have regarded as remarkable and upsetting, but which is now becoming traditional. Because we are familiar with it we no longer pay great attention to it as we once would have. There is obvious dissension in the ranks of the Government on various aspects of policy. Not only did the honorable member for Wakefield (Mr. Kelly) launch an unreasonable and unjustifiable attack on this particular tariff proposal and on public servants who, after all, are only commissioned to carry out the policy and orders of the government of the day, but he also made critical comments on his cohorts on the Government benches. Al- though I agree with him that there is far too much dumb acquiescence in the dictates of the oligarchy running the Government, I cannot help feeling that his cohorts were justified in criticizing him for attacking them in this way.
No less an authority than the Minister for Trade (Mr. McEwen) was the first to rebuke the honorable member for Wakefield, and he was quickly followed by the honorable member for Bruce (Mr. Snedden), who dissociated himself from the remarks of his fellow-supporter of the Government. I believe that the expressions of the honorable member for Wakefield epitomized the narrow, insular and parochial bigotry which is exhibited far too often by members of the Government. They do not take an expansive view of the needs of the national economy or make an overall assessment of what Australia needs in order to develop. There are certain members opposite who can think of nothing but their own particular problems. From what the honorable member for Wakefield said it is obvious that he has a farm somewhere, which he feels is the pivot upon which Australia revolves. It is to him the axis of the nation. He is not worried about the distress that exists in secondary industry. He does not care for the welfare of the thousands and thousands of workers who are employed in our industries. We, of the Opposition, take a more balanced view of these matters. We realize that tariffs are necessary. This cry of free trade and laisser-faire has been discredited during the past century of the world’s history, yet some honorable members opposite, from purely selfish motives, would see such a policy inflicted on the nation.
We, on this side of the chamber, realize that we have to protect secondary industries, because while workers in those industries are earning their pay they spend it. They constitute the consumer market. They are the people who buy the products of primary industry. Let us remember that it was the shortsighted and ineffectual policies of the Government which resulted in, first, the large-scale unemployment which has been maintained for a disgracefully long period, and secondly, a lessening of the prosperity of our primary producers. I am amazed that some of the rank and file of the Country -Party are not on their feet attacking the -Government strongly for its policy of protecting not one segment of Australian industry only, but all sections of it.
Tariffs are necessary if Australia is to develop. The Opposition does not believe that all products must have exorbitant protective tariffs. We realize that there must be present in industry a certain level of efficiency, but Australia has particular problems. We cannot launch out on a programme of industrial development such as the United States of America has, because whereas that country has a population of about 180,000,000 we have only 10,000,000 people. Our industrial production suffers certain restrictions which are not apparent in the industries of a country which can mass-produce huge quantities of one particular line. In Australia production must be on a smaller scale. Further, Australia has a reasonable standard of living, despite the efforts of the Government to wreck it. We have a reasonable standard of living-
– Order! I remind the honorable member for Oxley, as I reminded the honorable member for Scullin, that he is going outside the scope of the matter at present before the committee.
– With all due respect, Mr. Chairman, I was referring to the commodities under consideration and saying that if these things are to be manufactured in Australia, tariff protection is needed. I was coming to the point that eastern countries have low wage structures and therefore lower costs of production than ours are. I hope, and so does the nation, that it is not the policy of the Government to reduce our standards of living to meet competition on our home market, which, as members of the Government often claim, is our best market. We must offer our commodities on this market first because, if we do not, our consumer market will not be stimulated and our nation will not prosper.
Locally manufactured products such as polyvinyl chloride resins and moulding compounds, and hosts of other things must have tariff protection against competition from the products of low-wage countries. Many overseas countries subsidize these products. Japan heavily sub sidizes many commodities for export to the Australian market. Canada and France also subsidize some products for export to the Australian market and this upsets our trade. Dealing with woollen piece goods, the Minister for Supply said he felt that some protection should be afforded to a section of the textile industry which will face the threat of cheap imports from Italy. This is a subject I intend to develop further when that proposal is being debated.
The point I wish to make rises out of the attitude of the honorable member for Wakefield who, as I was glad to hear from criticism1 of him by fellow-members of the Government, was not expressing the attitude of the Government. His view was that we should have a period of free trade. We could not possibly hope to bear the burden of such a policy; it would wreck the development of Australia. We have already seen what followed from the Government’s policy of abolishing import controls in 1960. Imports rose and we had a heavy trading deficit. Then in a moment of panic, to offset this and other movements in the nation’s economy, the Government introduced a severe credit squeeze. We know the suffering that caused not only to the people of Australia but also to our industries. It set the development of Australia back by about 10 per cent. We lost about £700,000,000 worth of production because of the Government’s policy. Now imports are starting to build up again since the credit squeeze has been eased and at the same time the Government is commencing to remove emergency tariffs. Does this mean that we are to see a recurrence of the disastrous cycle which wreaked so much havoc on Australia? Are we to see now, as we saw previously, the abolition of import controls and the development of a heavy overseas trading deficit?
There is no need to go into all the side effects and all the side issues, because they have been debated in this chamber on previous occasions. The people of Australia know those things very well, as they indicated by their support of Labour in the last election. Are we to see a recurrence of the build-up in our overseas trade deficit, as the portents now seem to indicate? This type of thing must bo stopped and the Government must take a more realistic attitude towards the requirements and development of industry. It must realize that we need confidence and security in industry, particularly in view of Britain’s imminent entry to the European Common Market. If industry is to be rebuffed again - there are sections of industry which are still staggering and reeling under the blows administered by the credit squeeze-
– Order! I again remind the honorable member that he is going outside the scope of the matter which is under discussion at the moment. This is not a general debate.
– I wish to establish some form of parallel between abolition of import controls and the abolition of these protective emergency tariffs. If this nation is to develop to its proper stature we must have some measure of protection for industry. I am not proposing outlandish tariff measures, but we on this side of the chamber believe that reasonable action must be taken to protect employment in this country’s industries, which are operating for the benefit of the nation. We do not wish to sse any diminution of national development or any economic decline, but the portents are there, and unless this Government is prepared to undertake immediately an effective policy of protection for the benefit of the nation we will find our economy regressing to where it was eighteen months ago.
.- I rise to say a word in defence of my friend the honorable member for Wakefield (Mr. Kelly). I must say that I resent strongly the suggestion made by members on both sides of the chamber that the honorable member for Wakefield, in presenting to the committee the results of a careful consideration of the matter under reference, is a freetrader. The honorable member for Wakefield did an enormous amount of work on this subject, without having the benefit of the resources available to the Government in the Public Service, and came to a conclusion about the recommendations made which the Government has accepted, lt is utter nonsense to say that because of what he said the honorable member for
Wakefield is a free-trader in favour of the abolition of protection. At no stage in his speech did he say he was not in favour of the tariff. He did not even say that he was not in favour of the temporary protection procedures. What he did, taking evidence from both the Tariff Board report and the Special Advisory Authority’s report, was to cast doubt on the level of protection. Surely he is entitled to do that without everybody in this place branding him with the label “free-trader” and asserting that he is not in favour of the development of this country’s industries, or of national development, and is taking a narrow and parochial view.
These are complicated and complex matters. Why else would we have the Tariff Board system? . Why else is the Tariff Board required to make long and detailed reports to this Parliament? Why else is the Special Advisory Authority required to make reports? Why else do these reports require the consideration of this Parliament, if members are not to be entitled, after making an examination of the reports, to point to defects which they believe exist in the reports?
T listened carefully to the speech made by the honorable member for Wakefield, and not once did he utter a suggestion which implied that he was against protection. He pointed to some defects in the report of the Special Advisory Authority in this case, and I submit that his statements have not been answered. I say with all due respect that the Minister suggested that the honorable member for Wakefield did not realize that a capital-intensive industry had to have a large output in order to be able to pay, and that this was one of the reasons why protection in the particular case has been virtually doubled since the last Tariff Board report on it was made. I am sure that most honorable members understand - certainly the honorable member for Wakefield does - that it does not always work out this way, because what has happened in respect of this particular industry is that, as the honorable member for Wakefield pointed out, whereas there was one firm in the field before this duty was applied there are now two in the field. The second firm has been encouraged into the field by the level of protection given. Where are you in respect of capital-intensivity in that particular respect?
The honorable member for Wakefield has also been roundly criticized because, it was said, he was taking a selfish view when he talked of the effect that pursuit of an unwise tariff policy has on the farming community. What he said was perfectly true. The Minister mentioned capital-intensivity Is there any industry in this country which is more capital-intensive these days than farming? On a quick calculation, the average farm represents something like £40,000 to £50,000 in capital investmentand most farms need that amount of capital investment in order to be profitable - which means that the average farm is twice as capital-intensive as the Broken Hill Proprietary Company Limited.
– On a labour basis.
– Yes, on a labour basis. Even on the Minister’s arguments the farming community is entitled to some sort of consideration in that respect. I am just mentioning this in order to point out that the honorable member for Wakefield is perfectly entitled to refer to the effect that an unwise level of duty - not protection itself as such - will have on the farming community, even on the argument of capital intensivity
I will conclude, Sir, by repeating that I think that it would be a great pity for the parliamentary institution if, after an honorable member has made a careful and conscientious attempt to perform his duty to examine and review reports of the Tariff Board and the Special Advisory Authority, this new trend should be hit on the head. I know that that will not happen in this case, because the honorable member for Wakefield has got guts and will not be deterred by the tactics that have been used. But I repeat that it would be a great pity if this new trend were thrown overboard just because people are going to start pinning the old label of “free-trader” on anybody who disputes the level of tariff protection or the procedures used in applying protection.
– Order! I remind honorable members that this debate is on the subject of polyvinyl chloride and is not a general debate on tariff proposals or on the tariff in general. So I ask members of the committee to relate their remarks to the matter before the Chair.
.- I wish to make a brief comment on proposals that are listed on the notice-paper. As a member representing a country district I point out that my electorate is vitally interested in what happens as a result of Tariff Board reports on textiles. People in my electorate would like to know what is going to happen about protection for the textile industry, because country communities are dependent to a large degree for their prosperity on the textile industry and textile mills. They would like an assurance that the current proposals in connexion with textiles will not be proceeded with.
I differ from the honorable member for Barker (Mr. Forbes) in my understanding of the remarks made earlier by the honorable member for Wakefield (Mr. Kelly). I agree with the Minister for Trade (Mr. McEwen) that the honorable member for Wakefield implied that if we can buy imported goods cheaper than locally produced goods we should allow our local industries to fade away. An examination of “ Hansard “ to-morrow may prove otherwise, but certainly the Minister for Trade thought that the honorable member for Wakefield implied that. So did the honorable member for Oxley (Mr. Hayden), and so do I.
I would like the honorable member for Wakefield to bear in mind the fact that there is a vast difference between the cost structures of Australia and of the countries that compete with us. This fact is adequately borne out by a comment that appears on page 7 of the Tariff Board’s report: -
There is also a strong threat of competition from Japan which has a wage structure far lower than has been revealed in publications.
As a person who spent some years in Japan, I can assure the honorable member that that is true. There is a number of grades of employees in Japanese factories, and generally the information that you and I get about wages and working conditions of Japanese employees refers not to those on the lower rungs, but to the permanent employees on the top rungs of the ladder. To illustrate this, I turn to page 12 of the report, where I find the following comment: -
Australia Britain Japan 4 2 1
It was also contended that these ratios applied to indirect labour and to overheads as well as to direct labour.
If the argument of the honorable member for Wakefield were accepted, few industries in Australia would flourish, and our standard of living would decline sharply. I am sure that the honorable member for Wakefield would be the first to ask for and to accept protection for primary industries, and 1 believe he should take a more balanced view of the Australian situation. ] know that he supports - quite rightly - the principle of subsidizing primary industries. He supports the practice of limiting the manufacture of margarine because protection is needed for dairy farmers, and I agree with him in that connexion. I am sure that if cheap lamb and mutton were imported from New Zealand, he would be the first to cry out. I agree that primary industries need protection, but I do think that the honorable member for Wakefield should adopt a more balanced attitude when considering the position of secondary industries. It is true that primary industries provide the great bulk of our export income, but it is also true that employment in primary industries has been rapidly falling off over recent years. This has come about for a variety of reasons, such as the increased efficiency of Australian farmers, increased mechanization, development of new and better farm machinery, and so on.
– Order! I again remind the honorable member that he may, in order to illustrate a point, refer to some particular aspect of the situation, but it appears to me that the matters to which he is referring in detail have no relationship to the subject with which the committee is dealing at this stage.
– I bow to your ruling, Mr. Chairman. I was merely making passing references to these matters in order to illustrate my point. I would like to say, finally, that we should not be placed in a false position. If we rely on cheap imports we will sacrifice local industries that have been established at great capital cost and have been responsible for providing employment for many of our people. If we rely on cheap imports, and then find that our manufacturing industries are going out of existence, the imports may no longer be cheap. Having gained command of our markets, overseas manufacturers will then be able to sell their goods in this country at any prices they like to demand. Some people contend that we must have competition. I say that we should not destroy the competition that our own industries provide against overseas manufacturing countries.
.- This debate, unfortunately, has ranged a long way from the subject before the chair, and I do not see any way of bringing it back. By saying certain things, the honorable member for Wakefield (Mr. Kelly) has given Opposition speakers an opportunity to air a certain amount of propaganda.
– We are not on the air.
– That is quite true; the debate is not being broadcast, so the Opposition’s propaganda is largely wasted. However, the honorable member for Wakefield said one or two things that I should not like to allow to pass without expressing my differing opinion. I pay due homage to the honorable member for the great amount of work he has put into his study of this subject in the broad, but I do not believe he has brought to his considerations a properly balanced outlook. We in this chamber have an obligation to look at matters such as this from both sides and to give attention to all aspects. In particular, we should consider the position of both primary and secondary industries.
The honorable member for Wakefield referred to sliding-scale duties and said that they have the effect of fixing prices. I do not for one moment believe that this is the purpose of such duties, in the view of the Special Advisory Authority. The honorable member has approached the matter wrongly. In the case of polyvinyl chloride particularly, it has been apparent that if a high enough duty is imposed to give immediate protection, overseas manufacturers, who have big capital-intensive plants, as we have here, reduce their prices, making the duty ineffective. The method of slidingscale duties is an admirable one, and it is used with the intention not of fixing prices, but of giving necessary protection to the particular industries with which the special authority is concerned.
What I would like to point out to the honorable member for Wakefield is that the home market for primary products depends on an adequate level of employment. The growing local manufacturing industries are of very great importance to our primary industries. If people are prepared to invest their money in this country, and to establish plants and employ people with the necessary know-how to supply the important products covered by these proposals, we should give them every consideration. Of course, whether certain goods are of benefit to primary industries and should be imported without the payment of any duty is a separate question altogether. In this country we have two main sections of industry, primary and secondary, each dependent on the other. Every time we import products that are also turned out in local factories, we are importing unemployment. We are paying the wages, in effect, of workers in other countries. If the honorable member for Wakefield wants Australian workers to buy his Iambs, his wheat and his wool, he should turn his attention to the encouragement of secondary industries, rather than to carry on a campaign of sniping at them, as he has been doing for some time.
.- I have some news for you, Mr. Chairman; I intend to address my remarks, as far as possible, to the matter before the Chair, the report of the Special Advisory Authority on polyvinyl chloride. I would like to remind the committee that these tariff measures are really the result of Labour’s policy as announced during the last election campaign. Before the election this Government had completely discarded Australian manufacturing industries, and it was only when its majority was substantially reduced that it realized the vital necessity to establish a Special Advisory Authority, and in a roundabout, half-baked way, to face the great problem of protection of Australian industries.
The matter now under discussion is the result of one of the very many inquiries that have been made by special advisory authorities on the application of all kinds of organizations. The honorable member for Wakefield has certain views on tariffs. His views are difficult to follow, having in mind the fact that they are expressed by a man who, as the honorable member for McMillan (Mr. Buchanan) has said, seeks to sell his primary products on the home market, to Australian workers. To my mind, the honorable member has earned rebukes from members of his own party and from Ministers. I agree that the honorable member has demonstrated the fact that he has carried out a lot of research into tariff matters, but the views he has expressed are quite contrary to those that are held by honorable members on this side of the Parliament with regard to protection for industries such as that with which we are now concerned.
Generally speaking, the honorable member has launched an attack on the existing system. We do not suggest that the inquiry by the Special Advisory Authority, and the report produced as a result, provide the perfect answer to the problems of industry. This Government should have faced up to its responsibilities and afforded to manufacturing industries the protection that they so badly needed. Let us consider, for instance, the vital importance of the little industry that we are now discussing. The Special Advisory Authority states in his report on this industry -
Capital employed in the local industry would be of the order of £5,000,000 and employees engaged would approximate 1,000 persons.
I have studied the recent annual report of the Tariff Board and it is interesting to note the dependence of employment on the Australian manufacturing industry. The report contains on page 1 1 statistics relating to the number of people employed in factories in this country. In 1962 there were 1,100,000 people employed in factories in Australia. Industries which provide employment for Australians - the industry under discussion provides employment for 1,000 Australians - are entitled to protection from this Government.
Let us take this matter a step further. In appendix C on page 5 of the Special Advisory Authority’s report there is a list of the associations and companies that were represented at the discussions before the Special Advisory Authority. It would have been a simple matter to show beside the name of each association and company the capital city in which it operates. I would like to know also which of those associations and companies supported the proposal that we are now discussing and which were against it. Then we would know what interests were represented before the authority and which people want te deny protection to industries such as the one now under discussion.
It is interesting to note that a very prominent organization in the Australian Country Party sphere publishes a document in which it continually attacks the Special Advisory Authority and reports of the type to which I have been referring. That organization is the Australian Woolgrowers’ and Graziers’ Council. It regularly sends to me copies of its publication. It must know that I came from the country and am interested in its publications, but its policy does not appeal to me. I am interested in the organization only because of its attacks on the Special Advisory Authority. An article in the publication is headed - “.Lacking - A coherent policy towards protection “. The organization is on the right track there, because the Government has been pursuing a half-baked policy of protection which has operated to the detriment of the industry under discussion, as well as other great industries and the people of Australia generally. The Government’s policy has led to a reduction in productive capacity of industries. The article reads -
Twenty-six of the twenty-eight answers received by the Minister for Trade to his references to the Special Advisory Authority have confirmed the Minister’s appraisal of the situation: the necessary extraordinary duties (or quantitative restrictions in two cases) to restore the industry’s share of the market or return on funds invested have been imposed.
Dealing with another aspect, the publication reads -
This would probably involve limiting the protection to a small number of firms and complementary action to preserve competition in the Australian market would be required.
Is it not great to hear the Country Party organization speaking about competition in industry? I wonder why the Country
Party is so interested in restricting the production of margarine if it is a freeenterprise party and believes that competition brings greater efficiency and better prices for the people!
– Order! I suggest that the honorable member has made sufficient passing reference to the Special Advisory Authority in order to make his point on the subject-matter under discussion at the moment.
– I thank you, Mr. Chairman, for your wisdom and tolerance. I think you will agree that I am one speaker who has been reasonably on the ball, and for that reason you may see fit to allow me to complete the statement that I have been quoting. It is a direct attack on the Special Advisory Authority. It reads -
Australia as a member of the GATT could benefit from this promised liberalization of world trade- if a progressive policy towards living with the highly developed countries can be evolved. This would require the arresting and reversal of the present drift towards higher protectionism. Adjustments to new situations will be needed, but above all a coherent policy which can be identified and appreciated by the community generally is required.
That statement indicates that there are other people, even Country Party organizations, that do not agree with the system that has been established. It is a piecemeal arrangement. Because of the Government’s complete disregard for Australian secondary industries, there is still great concern among all sections of industry at the Government’s failure to face up to its responsibilities. I do not wish to infringe your ruling, Sir, but I must stress that the Labour Party is a protectionist party. It believes that the industry we are now discussing should receive adequate protection. The Labour Party assumes full responsibility for its claim that industries such as the one under discussion, which are providing employment and helping to develop Australia, are entitled to the fullest measure of protection.
If workers are to receive the adequate wages and reasonable hours and conditions to which they are entitled in this enlightened age it is reasonable for Australian industries to receive protection from the Government in competing with overseas industries. The Tariff Board on . page 10 of its report referred to a matter that has particular reference to the industry that we are now discussing. Under a heading “ ‘ Close Out ‘ Sales “ the report reads -
The Board received evidence of imports that had been purchased overseas at “ close out “ prices, that is, at prices which have been reduced below usual levels, both for the home and export markets, to enable the clearing of goods at the end of a run of production.
In other words, industries such as the one we are discussing are faced with dumping by overseas interests on the Australian market. That situation leads to unemployment and in many cases to the closing down of industries. The Special Advisory Authority is pursuing the policy established by this Government. The Tariff Board, at page 7 of its report, states -
Australian importers have had almost free access to world markets since the import licensing controls were virtually abolished in February, 1960. This has benefited consumers and manufacturers purchasing imported plant and materials but has meant stronger import competition to many sectors of Australian industry.
As the honorable member for Lalor (Mr. Pollard) has said, we on this side of the chamber will not oppose this proposal, but it is well to recall the reasons behind the Special Advisory Authority’s recommendation in relation to polyvinyl chloride products and, indeed, the reasons that prompted the Government to establish the authority. The authority was established because of the Government’s failure to protect Australian industries. There is a striking difference pf opinion between the honorable member for Wakefield (Mr. Kelly) and some of his colleagues in respect of import policy and protection policy. This indicates that the Government is unable to follow any coherent line-
– Order! The honorable member is now getting further and further away from the subject before the committee.
– I am sorry for my digressions, but it is obvious that among Government supporters there is a conflict of opinion in relation to a matter that vitally affects Australian industries. I hope that ultimately the Government will pursue a policy that will provide real protection and safeguards not only to our industries but also to the countless thousands of Australians who work in them.
.- The debate on the tariff proposals has proceeded sufficiently far to allow us to hear some of the many speeches that the honorable member for Wakefield (Mr. Kelly) has advertised that he proposes to make. I do not know whether he will make sixteen different speeches or make the one speech sixteen times.
– Stay here and you will find out.
– I will do my best. It is not always easy to listen to debates on these subjects. I would like to raise one or two points for the consideration of the committee. First I would like to refer to some of the remarks passed by the honorable member for Barker (Mr. Forbes). I suppose it would be true to say that neither the honorable member for Barker nor the honorable member for Wakefield is a free trader, but they get as close to being free traders as anybody in Australia could possibly get. I do not suggest that they are opposed to the tariff system or the method of imposing tariffs, but if they had their way I think they would so prune the system that there would not be a great deal left in it, unless, of course, the consequences of their action had removed them and their friends from the treasury bench or from the Parliament before they had proceeded very far. I hope to make one or two statements which do not have particular application to the proposal under discussion.
I think that in the Liberal Party of Australia and perhaps in one or two sections of the Australian Country Party, although this is not so characteristic of that party as of the Liberal Party, we have men who come very close to being free-traders and to wanting Australia to be subject to all the forces of the markets. They are soundmoney men-
– Order! The practice has been that an honorable member may make passing reference to certain factors to illustrate a point that he is making about any proposal before the committee. I repeat, however, that such references may not be allowed to develop into a general debate on tariffs, the Special Advisory Authority, economic policy or similar matters. Passing reference made for the purpose of illustrating a factor relating to the proposals which are now before the committee may not be allowed to develop into a general debate about circumstances outside the scope of the matter before the committee. The honorable member for Yarra is discussing and commenting on subjects that are outside the scope of the proposals at present before the committee.
– Mr. Chairman, in general it is clear that Australia must extensively use artificial measures in the way of tariff controls. The important thing is to ensure that those extensive artificial mea.sures such as tariffs are accurately based on informed judgments.
– What is the honorable member talking about?
– I must say that from time to time when measures of this kind come before the Parliament, it is most difficult for any honorable member - even the Minister for the Interior, who has just interjected - to know whether or not such proposals are based on sound judgments. I believe that the great majority of the honorable members in this committee are in fact prepared to approve these proposals without knowing very much about them.
– About which Tariff Proposals is the honorable member talking?
– I am talking about Tariff Proposals Nos. 21 and 22.
– Order! I remind the honorable member for Yarra that only Tariff Proposals No. 21 are now before the committee. They deal, among other things, with polyvinyl chloride, and, as I have already pointed out, this subject should not lead to a general debate on Tariff Prop–,ls
– Mr. Chairman, I have no intention of making’ this a general debate on Tariff Proposals1. However, the points that I have been discussing have already been discussed by the honorable member for Barker and others. I considered that it was necessary for ma to say something about those matte?3, both in answer to the points made by other honorable members and with particular reference to the matter under discussion.
The proposals that we are discussing concern particularly some parts of the chemical industry. The requests for tariff protection for the manufacture in Australia of polyvinyl chloride and of other products in which polyvinyl chloride is used have been made because materials used in earlier processes in the industry are themselves protected. On the basis of comparative costs brought to the notice of the Special Advisory Authority, perhaps it may be quite legitimate to agree to give the protection for which these Tariff Proposals provide. However, this conclusion is based partly on the assumption that the whole structure of protective measures for earlier processes in the chemical industry is itself justified. It may be years since the tariffs on the more basic chemical materials involved were in fact determined, and I think that there is in the industry a consensus of opinion that it is time some of the tariffs on the more basic chemicals which enter into the production of, and affect the cost of, a particular commodity such as polyvinyl chloride were reconsidered.
At the same time, I consider that a tariff of this kind may be justified on the basis qf the information placed before the Special Advisory Authority concerned when the application was made. The time is overdue for reconsideration of the protection afforded to some of the commodities that are further back in the line of production. I do not think that we should be ready to accept a form of protection based simply on the consideration of the commodity being protected. I think it is time that, in these various inquiries, we considered the manufacturing process itself and what is involved in the protection of commodities’ further back in the line of production. I think that it would be undesirable for any kind of questioning such as that which we heard from the honorable member for Wakefield to be merely brushed aside. Although I believe that it is necessary to use all the artificial measures, as I call them, to maintain development and expansion in the Australian economy, I thick that we are sometimes too ready to accept without adequate consideration any kind of proposal
Air. CLAY (St. George) [4.57].- Mr.
Chairman, it is not my desire to take up a great deal of the committee’s time, but I want to say something about some observations made by the honorable member for Wakefield (Mr. Kelly) on polyvinyl chloride. The honorable member is one member of this place who at least would know whether polyvinyl chloride was a parrot or a cockatoo. If there is one member of this place who really devotes his time to the study of tariff items, it is the honorable member for Wakefield, and I always listen with profound respect to what he has to say, even though I do not necessarily agree with him. The honorable member mentioned the name of the great company that manufactures polyvinyl chloride in Australia - Imperial Chemical Industries of Australia and New Zealand Limited - and pointed out that applications for tariff protection made by that company see-sawed between the Special Advisory Authority and the Tariff Board. There seemed to be, on the part of the Special Advisory Authority and the board, a strange, sweet solicitude for the company. I wondered, immediately I became aware of it, why the same strange, sweet solicitude was not extended to the textile industry. This brings me to the particular questions that I want to ask: Why were the Tariff Board reports on textiles and man-made fibres not presented to honorable members this afternoon? When shall we receive the reports, and what is to happen in the meantime?
– Honorable members have had the reports for a week or more.
– The reports have been presented.
.- Mr. Chairman, I suggest that the honorable members who told the honorable member for St. George (Mr. Clay) that the reports on textiles and man-made fibres about which he asked were already available misunderstood what he was getting at. He was really asking why the Customs Tariff Amendments, which were listed on to-day’s noticepaper and which are designed to confirm the tariff rates on textiles now operating were not proceeded with.
– Well, why did he say that he wanted the reports?
– He was misunderstood. I made that explanation, Mr. Chairman, having in mind some liberties that were taken earlier this afternoon by other people. The honorable member for Barker (Mr. Forbes), for example, came to the defence of the honorable member for Wakefield (Mr. Kelly). Then he told us that the honorable member for Wakefield has an ample supply of guts. I am sure he has. What impressed me particularly was the evidence of disintegration in the ranks of Government supporters because the Minister for Trade (Mr. McEwen) severely castigated the honorable member for Wakefield - a castigation which normally would have been reserved for me as the honorable member leading the debate for the Opposition.
After enjoying your indulgence, Mr. Chairman, I conclude by saying that we shall not oppose this proposal.
Question resolved in the affirmative.
Customs Tariff Amendment (No. 22)
Consideration resumed from 2nd May (vide page 1834), on motion by Mr. Fairhall-
That the Schedule to the Customs Tariff 1933- 1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals . . . (vide page 1833).
– This proposal covers three subjects. The first is the imposition of additional temporary duties on slide viewers and image projectors arising from a recommendation by a Special Advisory Authority. Secondly, following a report on yarns wholly of or containing continuous filament man-made fibres, including monofil and imitation gut, the Tariff Board found that existing duties on acetate rayon yarns should be retained and extended to yarns in chief part by weight of acetate rayon while triacetate yarns, not made in Australia, reverted to non-protective rates of duty. After examining the position regarding monofil and imitation gut it recommended reduced duties. The third concerns administrative changes relating to concessional entry of cocoa butter and the adjustment of the preferential margin on ammonium nitrate as used for explosives and the provision of a specific tariff item for empty gelatine capsules.
I commend the proposals.
– Is it the wish of the committee that the motion be considered as a whole?
– No. The Opposition is prepared to agree to items 44 and 382, but wishes to oppose item 390.
Items 44 and 382 - by leave - taken together, and agreed to.
.- The Opposition has asked that item 390 be considered separately because it is a reduction in tariff. The Tariff Board has recommended in relation to imitation catgut of man-made fibre materials, non-sterile, that the British preferential tariff be reduced by 20 per cent, and that the mostfavourednation tariff be reduced by 371/2 per cent. As far as we know, there has been no claim that this product cannot be or will not be manufactured in Australia, and in the absence of some satisfactory explanation by the Minister for the proposed reduction the Opposition very strongly opposes the proposal. It is evident that at some time the product we are discussing was either manufactured in Australia or manufacture in Australia was contemplated, and to assist the industry the two rates of tariff were imposed. We do’ not consider that there is any justification at this stage for adopting the Tariff Board’s recommendation that the existing protective tariffs be reduced. We believe that the Tariff Board’s report does riot go far enough.
-It is clear that the Tariff Board had no evidence on this particular subject and therefore it set down what it presumed to be a reasonable level of protection. After all, the board is not unknowlgdgeable on matters of this kind because of the general references which are made to it from time to time. Having no specific evidence before it, the board established the proposed tariffs as reasonable, and the Government is prepared to accept the recommendation.
.- The fact that the Tariff Board had no evidence either way before it is no justification forthe committee accepting the board’s recommendation for a reduction in tariff. Simply because some one was not wide awake enough to, attend the board hearing and ask that the existing tariff stand, there isno justification for the proposed reduction. A reduction in tariff may do a substantial injury to this industry. In those circumstances the Opposition will vote against this proposal.
Question put -
That the item be agreed to.
The committee divided. (The Chairman - Mr. P. E. Lucock.)
Majority . . 4
Question so resolved in the affirmative.
– Is it the wish of the committee that the remainder of the proposals be taken as a whole? There being no objection, the question now is, “ That the remainder of Customs Tariff Amendment (No. 22) be agreed to”.
.- In indicating agreement with the remaining portion of Customs Tariff Amendment (No. 22), I direct attention to item 458, which concerns capsules, empty, of unhardened gelatine. It has been explained that this item was included in the proposals under discussion because of an administrative change. I think the committee is entitled to know the nature of the change. An administrative change could have serious implications or it could be merely of a minor nature.
– Provision is made in the proposals for the free admission of empty capsules of unhardened gelatine. These goods were previously free of duty and they were unspecified in the tariff schedule. In these days, there is a considerable importation of these goods which are used particularly in the capsuling of medicinal products. They also have other uses, such as capsules for lighter fluid. It was thought desirable to make this special provision for them so that they could be dealt with more accurately statistically. In other words, there is no change in the tariff rate. These goods are merely being brought under a different specification for the purpose of keeping proper statistical records.
Question resolved in the affirmative.
Customs Tariff Amendment (No. 23).
Consideration resumed from 10th May (vide page 2190), on motion by Mr. Fairhall -
That the Schedule to the Customs Tarif 1933-1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals , , (vide page 2189).
– Is it the wish of the committee that this amendment be taken as a whole?
– I should like items 179 and 278 to be discussed separately from the other items in the proposals.
– The question is, ‘ That items 179 and 278 in Customs Tariff Amendment (No. 23) be agreed to”.
.- It is proposed to amend item 179 by inserting after paragraph (1) of sub-item (b) the following sub-items: -
Cb) Electrically operated thrusters and by omitting from paragraph (5) of sub-item (b) the words “ electrically operated thrusters and time switches, not covered by item 318 (e) “. It has been stated that the alteration of which approval is requested in both cases relates to drafting changes. The Opposition has no objection to that. The same reason has been given for the proposed amendment of item 278 sub-item (a) paragraph (1) and we express no opposition to that.
The variation proposed in item 278 (a) (3) (a) - metasilicates - is that the British preferential tariff shall be increased 12i per cent, and the most-favoured-nation rate reduced 2i per cent. It is proposed to remove the alternative fixed rates. Concerning item 278 (a) (3) (b) - other sodium silicates - the variation proposed is that the British preferential tariff shall be reduced 12i per cent., the most-favoured-nation rate reduced 30 per cent, and the alternative fixed rates removed. The opinion of the Opposition, at this stage, is in favour of opposing item 278 (a) (3) in relation to (a) metasilicates and (b) other sodium silicates in the absence of any satisfactory explanation of the proposed change by the Minister. We do not desire to challenge the increase of 12) per cent, in the British preferential tariff but we are concerned about the proposed reduction in the mostfavourednation rate.
.- 1 think the honorable member for Lalor will be quite happy with the explanation in this case. Duty has been increased on those goods which are made here in order to give a higher level of protection to the Australian manufacturer. Goods on which the duty has been reduced are not made in Australia. Therefore the reduction in duty is intended to give the customer a cheaper product. No injury to the Australian industry can result from the reduction of the duty on the item.
.- Mr. Chairman, the explanation seems to me to be very naive. What I should like to know is why, in the first place, a duty was ever fixed at 121 per cent, if the goods were not to be made in Australia or are not now made in Australia. Is the reason that after the rate was fixed the manufacturers who applied for tariff protection did not go on with their projects? Is that any justification for removing a protective rate that some manufacturer may now want to enjoy? Is there any real need to eliminate this rate simply because nobody is using the articles?
– People are buying them.
– I know they are, and always when they buy goods on which there is a protective tariff it is natural to suggest that those selling the goods are sheltering behind a tariff wall and imposing on the public a price that should not be imposed. That is conceded. The remedy for dealing with that sort of thing is to have some other kind of control. I should like to know what it is all about. I do not think the Minister’s explanation is satisfactory.
Items agreed to.
Item 318 agreed to.
.- Mr. Chairman, in every case the items concerned in this section of Customs Tariff Amendment (No. 23) are the subject of Tariff Board reports. In respect of some of them the rates are not changed; in respect of others reductions are uniform at 271 per cent.; and in one case it is 221 per cent. The Opposition does not see any good purpose in supporting the proposal to make these reductions. The items concerned are parts of gramophones, sound reproducers, turntable mechanisms, pick-up arms without pick-up heads, pick-up arms with pickup scads if used in original equipment, and so on, but in almost every case the items concern gramophones, recording and sound reproducing mechanisms. The Opposition is opposed to the reductions suggested.
– Mr. Chairman, I think I should refer the honorable gentleman to page 4 of the Tariff Board’s report on this subject. It is not nearly sufficient for the Opposition to object to a reduction in a tariff duty without taking into consideration the whole of the facts in relation to the Tariff Board’s recommendation. We talk airily of loud-speakers and gramophone pick-ups and things of that kind, but there is a vast difference between the poorest and best of each of these items. If the honorable gentleman will do me the honour and give himself the advantage of reading the item in column 2 of page 4 he will see there enumerated explanations and reasons which are extraordinarily strong and show why this decision to reduce the duty should have been taken so as not to penalize the Australian consumer who wants a better-class product.
It is true that a very useful and fine commercial product is being made in our own Australian factories, but there is a difference b:tween ordinary reproduction from a gramophone and high fidelity reproduction, which is becoming quite the thing in sound reproduction these days. Those persons who want higher-quality reproduction cannot get it from the Australian equipment as yet, although our industries may well be on the way to providing it. Those -people ought not to be penalized. At the moment reduced duties are sufficient, in the opinion of the Government.
.- The Minister has informed this committee that ordinary run-of-the-mill gramophones and sound reproduction instruments are already manufactured in this country, but states that if people want a better quality product they should be able to import it. To enable them to import these goods-
– They ought not to be penalized.
– I am going to deal with that. To allow people to import these higherquality machines it is proposed by this Government, acting on the Tariff Board report, to remove the only protection now existing. This protection would not only encourage local manufacturers to make the top-quality mechanism and equipment, but also give them some grounds for hope that, in the future, they might be able to go into production of the higher-quality equipment. There is no reason in the world why Australian manufacturers, Australian importers or the Australian people generally should be encouraged to have an inferiority complex and think that they can make an ordinary product but cannot make a superfine product. Everybody knows that during the war Australia turned out the ordinary product and also, in the production of scientific superfine instruments, excelled itself. 1 know that in the heavy engineering field power plants made in Australia under wartime conditions, being surplus after the war, were actually exported to the original licence-givers in Great Britain, and the equipment was adjudged to be as good as, or better than, the products originally made in Great Britain.
If we are ever going to encourage the production of superfine equipment in this country, now is the time. In the circumstances the Opposition will oppose this item that proposes to reduce the tariff now protecting this industry in order that somebody may be able more easily to import some superfine product. We want to see a tariff remain, even if it is inadequate, that may at least give some encouragement to people to produce the superfine product. Mr. Chairman, the Opposition will oppose this item.
– I do not want to prolong the argument or to disagree entirely with what the honorable gentleman has said about the capacity of Australian industry to produce the best. In some of the industries under my departmental charge we do produce the best in the world, but that does not alter the fact that such small quantities of the superfine products are required that the manufacture of a small run of such products is out of line. It is for this reason that our Australian manufacturers have not gone into the manufacture of super-quality instruments, from which the Government now proposes to remove some of the tariff protection.
Question put -
That the item be agreed to.
The committee divided. (The Chairman - Mr. P. E. Lucock.)
Majority . . . . 7
Question so resolved in the affirmative.
Remainder of Customs Tariff Amendment (No. 23) - by leave - taken as a whole, and agreed to.
Customs Tariff Amendment (No. 24)
Consideration resumed from 15th May (vide page 2295), on motion by Mr. Fairhall -
That the Schedule to the Customs Tariff 1933- 1962, as proposed to be amended by Customs
Tariff Proposals, be further amended as set out in the Schedule to these Proposals . . . (vide page 2294).
.- Mr. Chairman, I wish to address myself to Customs Tariff Amendment (No. 24). I will speak briefly and confine myself completely to the subject-matter, which will make my speech, in some respects, notable. The report of the Special Advisory Authority which justified this duty on phthalic anhydride was tabled on 10th May in this chamber. The report is remarkable in that it gives almost no information at all and even the pronunciation of the words “ phthalic anhydride “ worried me. I was interested to find out what this obscure compound is used for. 1 find from the report of the Special Advisory Authority that there is only one producer of this commodity in Australia. This is the Newcastle Chemical Company Proprietary Limited, which is jointly owned by Imperial Chemical Industries of Australia and New Zealand Limited and the Broken Hill Proprietary Company Limited. This firm employs seventeen men on the production of this obscure compound. I hoped that the Special Advisory Authority would have stated in his report what the compound is used for, but I could find no indication. But I understand it is one of the raw materials used in the paint industry. One cannot help noticing that the raw materials used in that industry are being heavily hit. Polyvinyl chloride is another example. These commodities carry a 371 per cent, duty and because its raw materials are becoming more expensive the paint industry will have to ask for a higher tariff protection. The price of paint will rise and there will be less paint used. Phthalic anhydride is also used in the manufacture of synthetic resins, a field in which, I understand, tariff protection is also being asked for. One of the reasons for this request is the increased price of raw materials. I think it is a very dangerous procedure to increase the prices of goods which are at the base of an industrial structure, especially when you realize, as in this instance, by doing it to maintain employment for only seventeen men you are making the employment position of people in other industries further down the scale more difficult. The Minister, in his quick defence of this measure, will probably say that the price of phthalic anhydride has fallen, and not risen, as a result of the duty. That is true, and that is the way you would expect a wise protection system to work. But remember this: The price of phthalic anhydride in Australia is 20d. per lb. whereas in the United States of America, which, I understand, has a higher wage structure than ours, the price is 16. Id. per lb., and the price in Japan is 12.1d. per lb.
The point I want to make is that although the price of phthalic anhydride - and this is the effect of this duty - has fallen by 4d. per lb. in Australia, in Japan it has fallen by lOd. per lb., so we are losing the benefit of the more efficient production, which is not coming from cheap labour - and we should not blind ourselves with that idea - but is coming from more efficient processes. If we are going to blanket these industries of ours - and do not forget that the production of phthalic anhydride by the chemical company in Newcastle means the employment of only seventeen men - and stop them from having the need to be efficient, we are going to make it difficult for the users of phthalic anhydride all down the processing line. The only reason I speak on this matter is that I think it has to be emphasized continually that if you put a high duty at the base of an industrial structure on such goods as chlorine products and phthalic anhydride you make the position of employment in the plants of the users further down the line very much more difficult. I think that that is something that should be mentioned in regard to this particular case, and we should regard this kind of duty with a certain amount of suspicion.
– I do not want to quarrel with my friend from Wakefield (Mr. Kelly), but I suggest that in some of these matters he is taking a view that is too short in terms of time. I quite agree with a great deal of what he said about the disability caused by loading the cost structure of an industry at its base in connexion with these primary materials. The honorable gentleman has directed the attention of the committee to the difference in the prices of this basic material, phthalic anhydride, in Australia and the United States of America to show that there is not a very big margin. He points out that the Americans are getting the benefit of more efficient processing But more efficient processing is sp very often a function of the size of the industry. I well remember not so very long ago when the ground on which the Newcastle Chemical Company now stands was swamp. To-day it has a thriving Australian chemical industry on it. Nobody here, looking at the industrial structure and realizing the growing importance to industry generally of the chemical industry, would wish that we should not build up’ for ourselves a competence in chemical production. I suggest that this kind of protection is the very thing which will allow this industry to operate at full efficiency with plant of the capacity required to satisfy the Australian market. I have no doubt that when that market grows the efficiency of the bigger plant will produce a fall in cost. That is precisely what we want. I believe that this measure will help to build up an Australian competence in the production of this very essential material and I support the resolution.
Question resolved in the affirmative.
Customs Tariff Amendment (No. 25).
Consideration resumed from 8th August (vide page 91), on motion by Mr. Fairhall -
That the Schedule to the Customs Tariff 1933-1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals . . . (vide page 90).
– These proposals impose additional temporary duties on distributors, high tension ignition coils, automatic voltage regulators, generators and -starting motors, of 6-volt and 12-volt ratings, of types used for motor vehicles. The action followed a recommendation by a special advisory authority. I commend the proposals.
Question resolved in the affirmative.
Customs Tariff Amendment (No. 26).
Consideration resumed from 8th August (vide page 93), on motion by Mr. Fairhall-
That the Schedule to the Customs Tariff 1933- 19M, as proposed to be amended by Customs Tariff Proposal, be further amended as set out in the Schedule to these Proposals . . . (vide page 92).
fS’.4’5]. - These proposals “impose additional temporary duties on conveyor belts and belting, other than of leafier and on a range of paper and paper-boards - specifically litho, poster and printing papers, wrapping papers, strawpaper and boards, paper felt and boards not elsewhere included in the tariff. The action stemmed from recommendations by a special advisory authority. I ask the committee to include in its deliberations of these proposals Customs Tariff (New Zealand Preference) Amendment (No. 5) which merely adjusts the New Zealand Preferential Tariff in accordance with the changes proposed by Customs Tariff Amendment (No. 26). I commend the proposals.
– Order! Is it the wish of the committee to consider Customs Tariff Amendment (No. 26) and Customs Tariff (New Zealand Preference) Amendment (No. 5) together and to consider the motions as a whole? There being no objection, that course will be followed.
Customs Tariff (New Zealand Preference) Amendment (No. 5).
Consideration resumed from 8th August (vide page 115), on motion by Mr. Fairhall-
That the Schedule to the Customs Tariff (New Zealand Preference) 1933-1962 be amended as set out in the Schedule to these Proposals . . . (vide page 114).
.- There are two classes of commodities referred to in these proposals with which I wish to deal - paper, paper boards and paper felt and conveyor belts and belting. I should like your guidance, Mr. Chairman, on whether I may discuss only rubber belting at this stage.
– The honorable member may discuss the matters contained in Customs Tariff Amendment (No. 26) and Customs Tariff (New Zealand Preference) Amendment (No. 5).
– I am glad to have the opportunity to be specific about this particular duty on rubber belting because it is one that I find really objectionMs. I want you to get these dates clear in your mind, Mr. Chairman. At the date of the reference to the special advisory authority the Tariff Board had completed its public hearing, but it had not submitted its report. I am referring to the full board. The Special Advisory Authority’s report was signed on 24th May and the full board’s report was signed on 28th June. So there was about a month during which this procedure was necessary. That is the first complaint I make. When this special advisory authority procedure was instituted we understood that the authority was to be called in if emergency action was needed; but nobody can tell me that emergency action is needed when there is only one month elapsing between the signing of the special advisory authority’s report and the signing of the full board’s report. But of course the Minister did not wait. He moved in and the special advisory authority was asked to report. He found that imports were threatening local production. In his report he did, not give any figures for imports but he said that the percentage was increasing. Of course, if the import figure were small in the first place then obviously a percentage increase of that figure would not be significant. The full board in its report found that at no time was the amount of imports more than 18 per cent. When you realize that rubber belting is something in which particular grades are needed for different jobs - and in any case there are always by-law entries given by the customs authorities to allow this particular class of goods to come in, because Australian industry cannot supply them - it is obvious that imports will not be affected outright.
The Special Advisory Authority admits, with typical frankness - and I pay a tribute to him for it - that there is a ring operating amongst these rubber belt manufacturers. If we wanted to put it in parliamentary parlance I suppose we could say that restrictive trade practices were being indulged in. I shall read an extract from the authority’s report, because I do not want to do him an injustice. Rather do I think he should get full marks for making these statements -
Certain users expressed dissatisfaction with the manufacturers’ practice of quoting uniform prices and conditions when tendering for belting contracts. In my view, there is some justification for this dissatisfaction and the practice may explain, in some small part, the local manufacturers’ loss of orders to overseas suppliers.
Having made that point, and having shown that he knows what is happening, he evidently felt that it was not fair to ask the manufacturers to break up their ring, and so he was prepared to impose increased duty of 5s. a square foot. The duty previously was 171 per cent, at the British preferential rate.
Conveyor belting is not a luxury material. It is vitally necessary in industry. It is an essential tool of trade. It is essential, for instance in coal-mining. We hope to build up our exports of coal, and yet we make considerably dearer the very tool that we have to use in the extraction of coal. There are many wheat silos in my area. There is one at Wallaroo in which 23,056 square feet of rubber belting is used. This extra duty of 5s. a square foot would increase the cost of equipping a similar silo - and they are going up all over my electorate - by £5,764. As I say, it is not a matter of an extra amount for one silo, because silos are being built all over the country. The extra cost will have to be borne by the wheat-growers. We build our own silos. It would be interesting to learn to what extent the cost of equipment for the bulk-handling installation at Gladstone would be increased by this extra duty.
One would think we were deliberately looking around for ways to make it more difficult to export goods competitively. After all, this is what we will achieve if we continue in this unreasonable fashion, rushing in and imposing unnecessary duties even when we know that a ring is operating amongst local manufacturers.
Since this report was made by the Special Advisory Authority the Tariff Board itself has made a full report. It realized that the duty recommended by the authority was unnecessarily high, and it proposed an increase of the duty from 171 per cent, to 271 per cent., that is, it imposed an increase of 10 per cent., but the final rate was still lower than that recommended by the Special Advisory Authority. I want to know, and I would like the Minister to tell me, whether, now that the Tariff Board has reduced to some extent the temporary duty imposed by the Special
Advisory Authority, the matter will be referred again to the authority.
.- Once again the honorable member for Wakefield (Mr. Kelly) has vented his spleen against the Special Advisory Authority. I interpret the authority’s report in a way entirely different from that in which the honorable member for Wakefield interpreted it. The honorable member has given no importance to the fact that the people involved in this ring that he speaks of are such reputable firms as Apex Belting Proprietary Limited, Bramac Limited, Dunlop Rubber Australia Limited, Goodyear Tyre and Rubber Company (Australia) Limited and Olympic General Products Proprietary Limited. These are the people who are providing this country with a complex of undertakings in the rubber industry which represent a valuable asset to Australia and provide a large volume of employment. The special authority said that he held discussions with representatives of the Electricity Commission of New South Wales, the State Electricity Commission of Victoria, the Australian Coal Association, the Associated Chambers of Manufactures of Australia, George Angus and Company Limited, Turner Brothers Asbestos Company Limited, Greendale Engineering and Cables Proprietary Limited and a whole list of other organizations interested in these goods.
The honorable member for Wakefield complained that no information was made available in this report.
– I did not say that; I was talking about the previous report, “on phthalic anhydride.
– If you did not say it you implied it very strongly.
– I have told you that I was talking about the report on phthalic anhydride, the one we discussed previously.
– And you implied exactly the same thing ‘in respect of this report. These people that I have mentioned gaye the special authority information which is not available to the honorable member, and on the basis of that information the authority decided that the industry was in need of protection. That was what he was appointed to decide. He did not know that a Tariff Board report would be coming out within a month. He examined the facts as they appeared to him, and, knowing all these things that the honorable number for Wakefield has referred to, such as the extra cost of belting used in silos, he decided that the extra duty was necessary. If the honorable member wants to talk about the cost of belting in silos, I suppose I would be allowed to mention that the belting used, for example, at the briquette works at Yallourn would cost a colossal amount. It would leave the cost of belting for wheat silos for dead! Yet, having all that knowledge, the authority decided that some protection was necessary, and so he did the right thing.
I suppose the honorable member for Wakefield, in insisting on attacking the authority, is merely carrying on the sniping campaign that I complained of a little while ago.
.- The honorable member for Wakefield (Mr. Kelly) suggested that insufficient information had been furnished to the committee.
– That was in respect of phthalic anhydride.
– I think the honorable member tried to give the impression that insufficient’ information had been made available by the Special Advisory Authority.
– In respect to which report?
– The report on rubber belting.
– No, I referred to the previous report.
– The honorable member says it was the previous report. I will take his remarks as applying to this report that we now have before us. From the laughter that I hear, it appears that honorable members enjoyed that remark. I will amend it and say that it could be said that insufficient information is given by the special authority who reported on the question of protection for belting. I have very great respect for the special authority concerned, but when the honorable member for McMillan (Mr. Buchanan) comes to his defence- and says that he interviewed the State Electricity Commission of Victoria, the Associated Chambers of Manufactures of Australia, Greendale Engineering and Cables Proprietary Limited, and 20 or 30 other firms that use rubber belting, I simply remark that unfortunately the special authority did not say what the opinions of those firms were. We could be charitable and say that this was, perhaps, an omission on the part of the special authority due to pressure of work. We know that these inquiries are piling up all the time, and, generally speaking, the reports are very well presented.
I agree with the honorable member for Wakefield that the cost of this product in a certain kind of installation is very high, and that an increased duty of 5s. a square foot on rubber or other kinds of belting represents a very heavy impost on the industries that use this product. But when the honorable member tells us that the extra cost of belting for a silo in South Australia will be £5,000 - perhaps he meant annually, but he did not say over what period - I remind him that he did not tell us the total value of the wheat conveyed on that belting during its lifetime. The honorable member is laughing, but he cannot laugh this off. The total value of wheat conveyed on belting that cost £5,000 could easily have been £5,000,000 during the life of the belt. In those circumstances the total cost of the belting would be infinitesimal in a consideration of total capital involved.
Sitting suspended from 6 to 8 p.m.
– When the sitting was suspended I was referring to the suggested increase in tariff on conveyor belting of 5s. a square foot. The honorable member for Wakefield has claimed that that increase will mean an extra charge of about £5,000 to organizations storing wheat. I suggest to the honorable member that if he has regard to the amount of wheat carried on conveyor belting the increased cost per bushel of wheat will not be significant.
– Will you tell that to my wheat-growing constituents?
– Without any hesitation. ‘From time to time the honorable member for Wakefield has stated that if tariffs were removed Australians would be able to buy their requirements of a large variety of goods cheaper than they now buy them under a system of protective tariffs. I assure the honorable member that if protective tariffs were removed and local industries destroyed there would be nothing to stop importers of a wide range of goods from imposing on the Australian community any price that they felt they could obtain. Earlier to-day the honorable member for Wakefield referred to a certain by-product produced at the Broken Hill Proprietary Company Limited plant at Newcastle. He said that only seventeen men were employed in the manufacture of that by-product. 1 would like the honorable member to tell me how much he thinks the Australian consuming public would be asked to pay for that product if there were no local industry protected by tariff and supplies had to be imported. The honorable member cannot give me that information.
– I should think the public would pay at least 6d. per lb. less.
– The honorable member for Wakefield said that a particular chemical product is sold to the consuming public at a certain price, but he did not tell us what the price would be if, in the absence of a local industry, importers were able to charge what they liked for the corresponding Japanese or European product. Obviously if an article is not manufactured in Australia, importers are at liberty to charge any price they like for the imported article. In all the circumstances the Labour Party is entitled to stick hard and fast to a policy of tariff protection in order to safeguard the economy and the employment of our people.
The honorable member for Wakefield claims, in effect, that the price of imported goods is loaded to the extent of the tariff imposed. The Government that the honorable member support’s could, if it so desired, introduce legislation to deal with restrictive trade practices. About two years ago the all-party Constitutional Review Committee recommended that legislation be introduced to deal with restrictive trade practices, but to date nothing has been done. This Parliament has the power to initiate measures which would, in effect, control prices, but nothing has been done in this regard. If we are to protect our manufacturing industries, not only must we provide tariff protection, but we must also exercisecontrol over restrictive trade practices and price’s.
– You would like price fixing,wouldyounot?
– During the courseof this debate the honorable member for Mallee(Mr. Turnbull) has had a good deal to say about the Japanese Trade Agreement.He admitted that I was abroad when the agreement was dealt with by the Parliament. I remind the honorable member that, although he may postulate that you cannot sellgoodsunlessyoubuygoods in return, it is notessential that we purchase from China or Japan goodsof a value equal to the value of the wheat or wool that we sell to China or Japan.
– We now purchase from those countries less than one-third of what we sell to them.
– That is true.
– Order! I remind the honorable member for Lalor that he is getting a little away from the subject before the committee.
– I concede that, but earlier in these discussions the honorable member for Mallee, in assessing the value of the Japanese Trade Agreement, emphasized the Opposition’s attitude to that agreement.
– That is true.
– Is the honorable member unconscious of the fact that Japanese traders sell products made from Australian wool in the markets of India, Africa and the Middle East for sterling and dollars in order to pay for their purchases of the raw product from Australia in the same sterling, dollars or other hard currency? The honorable member would not deny that that is so. Let me remind him that over many years Australia has sold its sheepskins and its wool to France.
– Order! At present before the committee are Customs Tariff Amendment (No. 26) and Customs Tariff (New Zealand Preference) Amendment (No. 5). I suggest that the honorable member for Lalor and the honor able memberfor Mallee may be able to havetheir discussion at some other time.
The question is, “That the motions be agreed to”.
.- Mr. Chairman, Customs Tariff Amendment (No. 26) embodies the proposal respecting the duty on paper, and I should like to discuss this for a few minutes. The story of the duty on imported paper reads like a serial. There is one report after another. The whole series of reports is really remarkable. Of all the industries being sheltered from the cold winds of competition, surely the paper-manuf acturing industry receives the best treatment of all. The last report on this subject by the full Tariff Board was made in 1957. In February, 1959, there was a dumping inquiry and it was established that paperboard from New Zealand was being dumped in Australia. The Minister for Trade (Mr. McEwen) took action to stop this. In May last year, a deputy chairman of the Tariff Board was asked to inquire into various classes of paper. He did so, and recommended a temporary duty of £28 a ton on coated papers, cartridge paper, blotting paper and paperboard. The main producer of these products is Associated Pulp and Paper Mills Limited. However, Sir, the deputy chairman, functioning under section 17a of the earlier Tariff Board Act, refused to increase the duty on fine paper, pointing out that the restrictive trade practices adopted by the company were one of the reasons for its trouble.
I have gone to some pains to find out what these restrictive trade practices were, and I may say that this has not been easy to do. I found that most of the merchants would not willingly say what the trouble was. Evidently, the company wields a pretty heavy stick and is ready to use it without hesitation. Therefore, I found it surprisingly difficult to get the evidence that I wanted. However, it now appears that Associated Pulp and Paper Mills Limited will supply wrapping paper only to members of the Wrapping Paper Merchants Association, which has a carefully regulated price list. If a merchant wishes to stand outside the association, stay out of the ring and sell paper at a lower price, he is forced to import paper. These high duties force merchants into this association and encourage restrictive trade practices.
The Minister for Trade, having received the report from the deputy chairman of the Tariff Board rejecting the request for additional duty on fine paper, reacted quite strongly and referred the matter back again under the obnoxious provisions of the act providing for reference in “ special circumstances”. The deputy chairman this time bowed before the storm and recommended temporary duty of an additional £10 a ton. This was in September of last year. The sorry catalogue continues from there.
In the meantime, Australian Paper Manufacturers Limited, considering that it was being neglected in this exercise, breasted the trough and requested temporary protection on the lines of paper that it was producing. This was in July of last year. The company received a hand-out of an increase of £9 a ton in duty, which just about doubled the duty. The deputy chairman of the board also found that that company, too, was engaging in a restrictive trade practice by giving a Ti per cent, discount to merchants who promised to buy only from it. If merchants will not buy only from that company, they are forced to import in order to compete, because no merchant can give his competitors a price advantage of 7i per cent. This restrictive trade practice is encouraging imports.
The deputy chairman of the Tariff Board had recommended two increases of duty, but, evidently, this was not enough for that poor company, because in May of this year, the Special Advisory Authority entered the fray and began to help the company. He recommended a temporary duty of an additional £20 a ton on wrapping paper. The duty on this product began at £19 a ton last year, went up by £9 a ton in July and then took another jump of £20 a ton to a total of £48 a ton - an overall increase of £29 a ton, or 68 per cent. And no one could justifiably describe wrapping paper as a luxury. The same sort of picture may be seen over the whole field. The duty on printing paper began at £28 a ton. The deputy chairman of the Tariff Board recommended an increase of £9 a ton and the Special Advisory Authority recommended another increase of £10 a ton. And so it goes on. In the meantime, the Special Advisory Authority admitted that these restrictive trade practices that the deputy chairman found operating were still operating.
The profit rate of Australian Paper Manufacturers Limited is highly interesting.
– What is it?
– The company’s last statement shows a profit of £2,089,250, or a return of 11.9 per cent, on capital. I know that this profit may not seem large to some people, but it seems large to me.
– Was this the company’s record profit in 22 years of operation?
– Yes, I believe so.
Mir. Malcolm Fraser. - Has not the company also made a bonus share issue?
– Yes, I think it has. It really seems ‘to be struggling along reasonably well. In the meantime, the poor old Tariff Board is scrambling about trying to catch up with things. The board completed its public inquiry, which was followed by a reference of the matter back to a deputy chairman of the board. Whether the board will hold another inquiry subsequent to this last reference to the Special Advisory Authority no one is told, but I presume that there will be yet another inquiry. Even if there is not, there have already been five inquiries into the papermaking industry since May of last year. If the Department of Trade were setting out deliberately to break the morale and the back of the board by imposing repetitive work on it, surely the department could do little better than it has done.
.- Mr. Chairman, I have listened carefully to the honorable member for Wakefield (Mr. Kelly). The Australian Labour Party has no illusions about the capacity of Australian manufacturers and business enterprises to endeavour by every possible means to exploit the Australian community. However, we are not unconscious of the fact that we prefer to be exploited by Australian-domiciled companies and enterprises rather than by concerns domiciled in other parts of the world. Not one penny of foreign capital is invested in any of the Australian paper and pulp enterprises. It is the proud boast of these companies that in every respect they are Australian. Australian money is invested in them and they use Australian plant. They are Australian enterprises. The
Australias Labour Party has no hesitation in supporting enterprises of that character reserving always the right through, we hope eventually in this country, legislation relating to restrictive trade practices, price control and just taxation, to ensure that these great Australian enterprises in no circumstances will exploit the Australian people upon whom they are essentially dependent.
I read in a recent report of Associated Pulp and Paper Mills Limited of the company’s resentment because, too frequently, Australian governments support and encourage the investment of foreign capital which inevitably and Without reservation must, together with the dividends it earns from the Australian people, be repatriated to the United States of America, Great Britain or Europe. Whatever the profiteering activities of this company may be, at least it can be said that in regard to the dividends which it declares and the profits which it distributes among its Australian shareholders, the Australian Parliaments, Commonwealth and State, have complete control over its activities and, to the extent that they think desirable, can discipline the company. Our arbitration courts determine the wage rates and conditions of labour of the company’s employees. In those circumstances, speaking on behalf of the Opposition in this Parliament, I have no hesitation in expressing the opinion that the Opposition stands four-square behind the measures of protection accorded to these Australian enterprises.
If the Government parties think that the protection’ will be abused by the Australian paper companies, they have the right to introduce restrictive trade practices legislation to cope with the situation. Despite the promises which have been made in this regard, no such legislation has been forthcoming. The way is open to the Government parties to accept the recommendations of the Constitutional Review Committee and thereby give power to this Parliament to police prices and profits. I repeat here and now that, although the companies stand always for high prices and profits, we stand four-square behind them because they have not been unreasonable in conceding to their employees a better standard of living than would be conceded by any company dominated by capital from
America or any other foreign source. That is all I have to say about the matter. We make no apology to the Parliament for our attitude.
The honorable member for Mallee (Mr, Turnbull) is continually mouthing remarks about Labour’s opposition to the Japanese Trade Agreement. I shall deal with that in due course.
.- I agree entirely with the honorable member for Lalor- (Mr. Pollard). I presume that had the. honorable member for Wakefield (Mr. Kelly) ever been a shareholder in either of the paper companies which have been mentioned he would have sold his shares by now. The honorable member should realize some of the advantages which the paper companies have’ brought to Australia. Let me remind him of the forestry industry. I should like the honorable member to come to Gippsland and see the wonderful work which is being done there. When we think of the way in which the dairy industry - a much more inefficient industry than is the paper industry - is being subsidized, we must realize that one day we shall not be able to grant such a high degree of assistance to the dairy industry and that the only employment available in the Gippsland area will be in the forests. Here is a new primary industry. We have sought to encourage primary industry in many ways. Surely it is worth while to grant assistance to the paper industry. Surely the cost of doing so will be more than offset by the additional employment opportunities which will be made available. The honorable member for McMillan (Mr. Buchanan) has reminded me that the majority of people employed in the paper industry in Tasmania, Victoria and Queensland are engaged in a primary industry.
I support the proposal which is now before us.
.- We should not lose sight completely of the points made by the honorable member for Wakefield (Mr. Kelly). They amount, substantially, to two criticisms of our present method of tariff making. Apart from the criticisms he has made of the relationship between the Minister for Trade (Mr. McEwen), the Department of Trade and the Tariff Board, he has stated that in accepting a tariff we are ignoring the significance of restrictive practices in industry. Clear evidence has been produced to, and accepted by, the Special Advisory Authority during his investigation of the two most recent cases which have been mentioned, namely, the conveyor belt industry and the paper industry. The evidence indicates that it is unsound economically to continue granting tariff protection to concerns that operate in rings to raise their prices independently of their cost of production and to do the very thing that the tariff seems designed to prevent. We adopt a tariff system to establish an industry and allow it to grow sufficiently to produce at lower costs and lower prices. But here the honorable member for Wakefield has put his finger on a weakness. He has said that in respect of conveyor belts the Olympic and Dunlop companies and two or three other producers operate in a ring, fix their prices-
– Order! I remind the honorable member for Yarra that that particular proposal has already been dealt with.
- Mr. Chairman, I shall go on to another point if you rule that way, but a few minutes ago, when I asked permission to speak and you said that you would call the honorable member for Wakefield, it was on this very point that I wished to speak.
– I am sorry. The honorable member for Yarra may make a brief reference to the matter. I remind him that he has been dealing a little bit too closely with general restrictive trade practices. If he relates his remarks particularly to the industries mentioned in these proposals he will be in order.
– I think, Mr. Chairman, that the only point you had queried was whether I was correct in relating conveyor belts to production by Olympic, Dunlop and other producers. This was one example of a restrictive practice. That matter is dealt with in the report of the special authority in respect of the tariff we are now discussing. The second example concerned paper and the restrictive trade practices in which Associated Pulp and Paper Mills Limited was involved. The very purpose of the tariff would be defeated if this process were allowed to continue without question. We have had evidence that the concerns that, will be protected by these two tariffs when approved by this committee are fixing their prices higher than they need to be and have been making record profits - in one case I think, for 28 years.
It surprises me to hear from the other side of the chamber criticism of excess profit-making. When the honorable member for Wannon (Mr. Malcolm Fraser) interjected a few minutes ago I was quite surprised to hear some implied criticism from the Government side of people who might have shares in Associated Pulp and Paper Mills Limited. I should have thought that perhaps the honorable member for Wannon would have had an investment in that company, but apparently his investments are placed in other high profit organizations. I shall leave that matter there.
I think that the honorable member for Wakefield has made a strong case in relation to the effect of restrictive trade practices and other matters to which I cannot refer because of the nature of the debate but which have been referred to in this committee during the day. I think, Mr. Chairman, that I would be prepared to concede the substance of the case made by the honorable member- for Wakefield but I do not want the honorable member or any one else simply to let it go at that. It is all very well to criticize what occurs in the course of the imposition of tariffs on commodities such as conveyor belts and paper pulp. But what is the alternative? Are we to refuse to impose the tariff? Are we to refuse to grant applications for tariff protection and allow imports freely to enter Australia? Clearly, if this occurred it would affect Australian industry and presumably the commodities that would otherwise be protected by this tariff would not be produced. Surely the Special Advisory Authority has satisfied himself about that.
This tariff, we can assume, is necessary to allow production of conveyor belts and paper pulp either to continue at its present level or to be expanded. If we do not approve of this proposal, as has been pointed out, other industries will be affected. If paper is not protected the timber industry will be adversely affected as will the whole development and progress of Australia. Arc we to allow paper imports to come in? I think the honorable member for Wakefield has not established his case in respect of this. He might state that paper pulp would come into Australia for 6d. per lb. less than the price at which it would be sold under this tariff, but we have had a good deal of experience of rings and price fixing by importing concerns and we have no guarantee that if we allowed free imports into Australia without the competition of the Australian product a lower price would result. So I ask the honorable member for Wakefield and those who support him on the other side of the chamber, at some stage of the debate on these almost multitudinous items, to say whether their remedy is simply to refuse the tariff.
There are other alternatives to what the Tariff Board or the special authority or the Minister may do. I suggest, Mr. Chairman, that indicating for a moment what those alternatives are is completely relative to the matter before the committee. If the essence of this problem, in one respect is the establishment of restrictive practices, the operation of rings, the charging of excessive prices and the making of excessive profits, then perhaps the appropriate corrective is to introduce a restrictive practices law. We have been waiting for three years, or four or five, for the Attorney-General (Sir Garfield Barwick), in co-operation with the State governments, to frame such a law. This is no remedy, either. Restrictive practices legislation has been so long delayed that we cannot anticipate that it will ever be introduced and, even if it were introduced, we would have very little confidence that it could be effective. In those countries in which such legislation has been introduced it has not proved to be very effective in keeping prices within reason. There is another remedy that might be adopted in cases such as this. I think that if it is established at a tariff inquiry that restrictive practices exist the correct attitude for the Government to take is to refuse the tariff. The Government should say that unless the restrictive practices are abandoned tariff protection will not be provided.
Surely we should not be prepared to give tariff protection under any conditions that may operate. We should not give tariff protection to monopolistic organizations, such as those cited in this debate which are operating restrictive practices in order to enable them to increase their prices and make still more excessive profits. That would certainly not be in the interests of the Australian worker or consumer. Such action would be in the interests only of the monopolistic organizations concerned and, I regret to say, only in some instances in the interests of the union that organizes labour in their industries.
The honorable member for Wakefield and his supporters must offer a little more than destructive criticism in this matter. In the course of the debate they have offered some very effective destructive criticism of tariff making but they have said nothing whatever about what they themselves would do. We are allowed to assume from what they have said that they would have refused the tariff, but that is no way out of it. We cannot get out of it that way. The development of Australian industry is going to require more protection in the future than ever it has had in the past, and those people who think in terms of primary or raw materials industries providing employment for people in this country and believe that we can move further in that direction are completely wrong. If we had relied on that kind of thing we might have a population of 3,000,000 or 4,000,000 in this country, which would have perhaps a higher average standard, but no more. In fact we have 10,500,000 people to employ and to retain in employment in Australia, and that cannot be done without a system of protected secondary industries. That system of protection has to be efficient, and it is not much good our adopting a system in which we see a Special Advisory Authority refer a matter back, presumably because there are unsatisfactory conditions of restrictive practices operating in the industry, and then have it thrown back to him, and be told, in effect, “You put a tariff on this, despite what you have discovered.” That is not the correct attitude to take. This is where the criticism in this matter rests firmly at the door of the Minister and perhaps his departmental advisers, because they are meekly and continuously accepting the practices of monopolistic industry in this country and will do nothing to interfere or check them.
I should like the honorable member for Wakefield (Mr. Kelly) to say what he would do in these circumstances. I suggest that we should refuse a tariff unless the restrictive practices are broken down and, further, that we should consider refusing a tariff unless an economic price is charged for the product produced. By “ economic price “ I mean a price sufficient to cover reasonable wages, reasonable profits and enough for the capital development of the industry.
These are directions in which our tariff making will have to go in the future. It is not sufficient simply to allow the Tariff Board to be an organization to which industry can go and make a request for a tariff and get it under almost any circumstances, allowing that industry to go out afterwards and do precisely what it likes in the fixing of prices and the determination of output. The responsibility of government goes a great deal further than that. That is where the criticism should be directed in this matter. I think the honorable member for Wakefield is to some extent missing the point. I ask him and other Government supporters to say what they propose to do to solve this problem.
– Mr. Chairman, the honorable member for Yarra (Mr. Cairns) does not seem to agree completely with the honorable member for Lalor (Mr. Pollard). The honorable member for Lalor made some quite good points when he said that the employment opportunities made available by some of the paper companies have been good, and perhaps above average, and he seemed to imply that perhaps because of this protection for a company such as Australian Paper Manufacturers Limited or Associated Pulp and Paper Mills Limited should be granted, no matter how high the protection is. But the honorable member for Yarra seemed to say quite clearly, unless I was mistaken in understanding him, that because the companies may, and probably do, enter into some restrictive practice arrangements they should be denied access to the tariff until they put their own houses in order. That may be a weapon which will be adopted by some Commonwealth government some time in the future to try to prevent some of the worst abuses of restrictive practices, but the view of the honorable member for Yarra is quite different from the view of the honorable member for Lalor. One would disallow a tariff and the other would accept a tariff, no matter what, because the employment conditions were good.
The honorable member for Wakefield has done a real service to this committee in forcing this debate on these tariff proposals. Very often these matters have come up in the past and have gone through the Parliament very quickly without the examination that they deserve and that the Parliament should give them. All honorable members on both sides of the chamber should admit that if it were not for the honorable member for Wakefield we would not be having the debate that we are having at the moment.
I want to comment on only one point and try to bring out again some of the implications in what the honorable member for Wakefield was trying to say about paper and paper companies.
– Was he so difficult to understand?
– It is only my dim understanding which made me use the words “ trying to say “. Other honorable members understood him very clearly, I am sure. These paper companies have been granted, by the Special Advisory Authority, pretty high temporary duties and there is a fair likelihood that these temporary duties will be adopted by the full Tariff Board when it has another inquiry. That does not always happen, but it has happened quite frequently.
It is interesting to look at the position of particular companies, and I will take as an example just one, Australian Paper Manufacturers Limited. It is well known that in the last year that company announced a record dividend peak for 21 years and a record profit, I think, for all time. The profit was £1,610,000, in round figures, for the year ended 30th June, 1961. For the year ended 30th June, 1962, the profit was £2,089,000, in round figures.
– What is wrong with the profit?
– There is nothing wrong with the profit, but it seems strange that a company which has screamed to high heaven that it has been hil by the financial policies of this Government, shortly after it has been making hurt noises, is able to announce a record profit, a record peak dividend and a share bonus issued for its shareholders. Yet the conditions which the company had been able to establish before the Special Advisory Authority were, at the same time, such as to persuade the Special Advisory Authority that they should have some high additional temporary duties. Those facts, to me, do not seem to add up. The profit position of the company was not bad and, certainly, the record as reported in the financial pages of the newspapers some time ago would seem to indicate that the financial position of Australian Paper Manufacturers was pretty sound. The company has been able to come again at the end of last year with a peak profit and record dividends.
– You mean to the end of June?
– To the end of June, 1962. I know that the temporary duties were granted earlier than this.
– The company was suffering.
– It was not suffering before to that extent. The dividend it paid for the year before was quite a realistic one and the profit it made for the year before was quite a realistic one of £1,600,000, a return of a bit over 9 per cent. How a company such as Australian Paper Manufacturers can, at the same time, persuade the Special Advisory Authority that it requires additional temporary tariff protection is quite beyond my comprehension.
.- Mr. Chairman, this is a very interesting debate centred on the paper industry. There has been a great divergence of opinion among members on the Government benches about the justice and correctness of the decision by which duty has been imposed on paper coming into Australia. As one honorable member interjects, there may be a little difference between members on this side of the chamber, too, but it is very little by comparison. The differences have hardly been noticeable, but in view of what the honorable member for Wannon (Mr. Malcolm Fraser) said about the profits of the paper industry, let me say that we in
Tasmania were grateful that the industry was assisted at this stage of its development and we, too, wonder how such a high profit and such high dividends can be reconciled with the granting of the duty. The company referred to must have had very good spokesmen and facts we did not know of when presenting its case to the Special Advisory Authority. 1 agree with the honorable member for Yarra (Mr. Cairns) that the purpose of tariff protection should not be to increase unnecessarily the dividends or profits of any company, whether it is monopolistic or otherwise. If the tariff did that we would just be handing increased profits to private companies on a plate. Surely that is not the purpose of this Parliament, of the Tariff Board or of the Special Advisory Authority! The purpose of these bodies is to see that industries of this kind are kept going on a sound economic footing and that nothing is done to drag them down or cause a recession in their development through unfair overseas competition. Australian Paper Manufacturers Limited is a very good and efficient industry. At Burnie, on the north-west coast of Tasmania, this company employs well over 2,000 men, including the men in the bush, and it also has another mill or two in Victoria. It is a very big company and is doing a mighty job for Australia by supplying high-class paper and helping to give employment both at Burnie and on the mainland to thousands of men and women who would not otherwise be employed.
I feel that this industry is doing a great service to the economy of Australia. During the credit squeeze it was caught in a pincer movement. First of all there were the credit restrictions, which affected sales of paper to consumers and, secondly, there was unfair competition from imports. That was the pincer movement in which this industry, like many others, was caught up. The paper industry came to the Special Advisory Authority with a case for a duty on imported paper. The duty was granted, but not at as high a level as the industry wanted. I feel that on this tariff the industry will survive the temporary setback to its output and its expansion. Its profit for the twelve months ended June, 1961, proved that A.P.M. must be a very efficient company, in that it could produce a profit and pay dividends during a year of credit squeeze.
– What was the profit?
– I am informed that the profit was £2,089,000. The Special Advisory Authority has imposed a temporary duty, as the honorable member for Wannon (Mr. Malcolm Fraser) said, and the Tariff Board will’ later examine the position, lt may be six or even twelve months before the Tariff Board gets around to looking at the special authority’s decision. At that stage it could either retain the duty at present imposed by the special authority, reduce it, or even increase it. So, for nearly twelve months the industry will have protection.
During the year of the credit squeeze unemployment at the Burnie mill amounted to about 600 men. That was a very large number indeed, but many of those men have been re-employed. Many of them are specialists and found great difficulty in obtaining temporary jobs elsewhere. They were brought up in the industry and know it from end to end. We are pleased to know that the industry has been assisted by the special authority, so that it can reemploy many of the men who were put out of work. Another reason why this industry deserves some consideration is that A.P.M. is going to expand in northern Tasmania by building another enormous mill at Wesley Vale, near Devonport in my electorate. The company proposes to spend £20,000,000 on the project over a ten-year period and preliminary building has already commenced on the site. This is a very good thing for the economy of Tasmania and that of Australia as a whole. Certainly it will improve and stabilize the employment position in that part of Tasmania.
We congratulate the company on its foresight in practically doubling its plant and production. It has expanded each year for many years and this project at Wesley Vale is a very big forward move. This legislatior will, enable A.P.M. to expand freely and without financial difficulties in this area.
– To expand its business or its profits?
– Both. It will expand its business and, no doubt, profits will improve also. Owing to the profits it has made this company is not in as bad a position as many others which have applications before the special authority. It has been fortunate in having been granted an extra duty to pro tect it from overseas competition. It is now up to the company to prove to the Government and to the special authority that having been given protection it can do the job efficiently. We, on this side of the chamber, feel that tariff protection should not be designed simply to expand dividends and profits unnecessarily, but basically to maintain economic stability and help the growth of legitimate Australian-owned industries. That is why we support this legislation.
– Order! The honorable member’s time has expired.
.- During an earlier part of the debate I said the honorable member for Wakefield (Mr. Kelly) should be congratulated on the amount of work he had done and the study he had made of the subject. I am afraid that in the case of the paper industry he has broken down a bit and has not even read correctly the amounts of duty to be imposed. The honorable member mentioned a duty of £48, which I cannot find anywhere in Customs Tariff Amendment (No. 26). The report of the Special Advisory Authority - after all, that is the only report that we are considering - was made to cover a particular set of circumstances. In that report it is stated that between December, 1960, and December, 1961, Australian Paper Manufacturers Limited and its subsidiaries put off 1,000 men. That is a very important point which the special authority no doubt took into consideration. Some 250 men were put out of work in one corner of the McMillan electorate where an A.P.M. mill is located. I am well aware of the distress that was caused in that area and of the great difficulty there is in finding employment for people put out of work in these circumstances in a rural district. I realize the necessity to put such people back into work as soon as passible. Paper is a special type of commodity and its manufacture is a specific process which must be carried on 24 hours a day and seven days a week. Otherwise paper cannot be produced economically. The industry has had to face the competition arising from much dumping of imports and, in order to protect itself, it has explained to its customers that it has to have full production in order for its plant to be economically run and in order for it to survive, and that it was prepared to give them a discount of 7i per cent. - quite a substantial concession - if they would give it all their business. I do not regard this as being a restrictive trade practice, because the company had to do that in order to keep its mills working on a full production basis. If the trade supports the company by giving it more business the whole of Australia will benefit.
This is an industry which operates in every State and provides much employment, and it needs the support of the various outlets, which are themselves Australian manufacturing industries. It does not matter to the paper-bag manufacturers whether they use imported or Australian-made paper for their bags. They are concerned only with getting paper of a quality that will hold a pie or a pastie without its falling through. The cigarette manufacturers make packets to hold Australian cigarettes. Whilst they are pleased to get the fullest protection they can from this Government as regards their own cigarette-making industry they have the impertinence to want to import board for the making of cigarette packets, for the sake of saving £5 a ton or some such ridiculously small figure, which would mean that our own mills, which are quite capable of producing those things, would not be able to maintain full production and full employment of their workmen.
I had the pleasure of taking the PostmasterGeneral (Mr. Davidson) through the mill of Australian Paper Manufacturers Limited at Maryvale last month. It was found there that as a result of the action taken by the Special Advisory Authority in recommending a temporary duty the mill has been able to show to the buyers in Australia that this is a place where they ought to buy. That is what the buyers should have been doing anyway, without being forced into it. As a result of the action taken the mill is again working with its full quota of employees for 24 hours a day seven days a week, and the atmosphere in that part of the country is entirely different from what it was. The action of the Special Advisory Authority in recommending protection has been fully justified.
Something was said by an honorable member about the 7i per cent, discount which this company has offered to customers. I should like to point out that
Australian Paper Manufacturers Limited is the producer of paper used for corrugated board and that there is another company - General Corrugated Paper Company - which is also associated with General Paper Mills Limited in the manufacture of corrugated paper. Australian Paper Manufacturers Limited is quite prepared to supply General Corrugated Paper Company with the paper but is not prepared to give that company the H per cent, discount because General Corrugated is a competitive business house and Australian Paper Manufacturers Limited is not prepared to help a competitor. That is in accordance with ordinary business practice.
The Special Advisory Authority finishes the paragraph dealing with this matter by saying -
In the circumstances-
That is, the refusal to grant the discount -
I do not recommend temporary duty on corrugated paper.
I maintain that the Special Advisory Authority has handled this matter with judgment and studied each problem as it came up. He has given protection and help to the industries where they need it and when the facts placed before him have warranted it. In other cases he has recommended against protection. He has done an admirable job in the best interests of Australia.
.- As the honorable member for Wilmot (Mr. Duthie) said earlier, this is a most interesting debate, and I am very happy to be here not only to listen to the speeches made during it but also to play my role, to a minor degree, in the debate. I am indebted to the honorable member for Wakefield (Mr. Kelly) for the speeches he has made to-night. I was horrified earlier in the week when I read that the honorable gentleman proposed to deliver sixteen speeches to-day, but I must say that those of his speeches that I have heard have been very interesting. They have been educational, and they have shown to me that the points made by members on this side of the chamber in various debates in recent times - which were contested by members of the Government - have been proved to be factual.
The honorable member referred to restrictive trade practices being indulged in by various manufacturers who are attempting to take advantage - like the company concerned in the matter we are now debating - of the Tariff Board and1 the Special Advisory Authority in order to inflate their profits. If such be the case - and we on this side of the chamber say it is the case - there is a responsibility on the Government to do something about it. I know that honorable members opposite have long been the apostles of free trade and have said that they do not believe in any form of prices control by a government. Yet they are endorsing absolutely a form of prices control organized by manufacturers who create these monopolies - and the people of this country are the victims.
It has been suggested by some honorable members that Australian Paper Manufacturers Limited has been getting a hand-out from the Tariff Board - to use the term employed by a member on the Government side - because of the large profits it has made. The profit for last year has been stated at £2,089,000. We must all admit that no business organization establishes a manufacturing undertaking merely for the sake of supplying Australia with a commodity it needs or for the sake of providing work for the workless. An organization establishes a business undertaking for the purpose of making profit. At least, that is the first consideration. Apparently this company has been successful at long last in making a very substantial profit. Birt it has also, in adversity - adversity created by the policy of this Government - provided employment for a very large number of men. I am indebted to .the honorable member for McMillan (Mr. Buchanan) who pointed out that only recently, as the result o.” the policy of the Government that he supports, this company alone was compelled to dismiss 1,000 employees who had been engaged in the manufacture of paper. Associated with the fact that they were working perhaps under more advantageous conditions than the manufacturers in Australia enjoy, the low tariff on paper enabled manufacturers overseas to undercut the Australian manufacturers. As we all know, this company applied to the Special Advisory Authority for some immediate consideration of its case and, whilst the authority has not given all that was asked, he has given partial assistance to this very progressive and active company.
The policy of the Labour Party is for protection to Australian industry. That policy has borne fruit. On two occasions, one of them after the depression that followed the First World War, and the other immediately following the Second World War, when Labour governments were in office, the policy of strong protection was implemented and, as a result, Australia changed from a purely primary producing nation into a nation with widespread manufacturing activities. This has been the result of the protectionist policy implemented by Labour governments and followed, to some extent, by some honorable members on the opposite side of this chamber.
But at the present time we have a coalition government, made up of partial protectionists on the one hand and freetraders on the other hand. I find it difficult to follow the views advanced by the honorable member for Wakefield, who is a member of the protectionist party that forms one side of the coalition, but who is really advocating free trade. We on this side believe in protection for Australian industry, and the company I have mentioned has shown justification for the protection that has been extended to it. Apparently there is a large group of members on the Government side who believe in protection for themselves on their farms, but not for the consumers of their goods. What would happen if a policy based on that kind of belief were implemented in South Australia, which is rapidly becoming a manufacturing State? What would happen there if the industrialists were to lose their markets and large numbers of employees were to be thrown out of work? Where would be the market for the fat lambs raised on the honorable member’s property?
– Order! The honorable member may be able to ask that question during another debate in this committee or in the House, but I remind him. that it has no relevance to the matter now before the committee.
– I mentioned the matter only in passing, Mr. Chairman, and I shall- make no further reference to it. I bow to your ruling. I have always respected the rulings you have given when occupying the chair. 1 am very pleased that the special authority has seen fit to grant some relief to this company. I realize that it is a progressive organization supplying newsprint for our newspapers and other kinds of paper for the Australian nation. It is a national institution, playing a noble role in industrial development, and I hope that the relief that has been given to it will be of material assistance and will enable it to expand its undertaking and so provide more and more employment for the Australian people.
– I had not intended to take part in this debate. However, I would like to say that the honorable member for Wakefield (Mr. Kelly) is to be congratulated for directing attention to a matter of prime importance, the trend towards imbalance between what are known as the primary and secondary industries. I congratulate him for having put forward the point of view that he has expressed in the debates, not only on this particular subject but also on other subjects that we have discussed. At the same time, I believe that there are certain aspects of this matter that have not been sufficiently emphasized. Paper manufacture rests essentially upon a great primary industry, that of forestry, and this country has not a sufficient area devoted to forests, in comparison to its total area, for us to feel safe about our reserves of raw material. It is true that companies engaged in paper manufacture use up a large volume of our forest resources, but it is also true that those companies are contributing to the expansion of our forests and, to that extent, they are increasing the value of Australia’s primary production.
I want to remind the committee that the Australian paper manufacturing industry received its first real impetus during the war. At that time the supplies of paper were rationed and those who used paper, particularly the newspaper proprietors, suffered headaches wondering how they could get sufficient paper for their needs. This resulted in the building up of an Australian paper industry, which has expanded in the years that have followed. As one who knows a little bit about newspapers, from the business end, I can say that the advent of Australian newsprint and other paper manufactures has brought down the price of paper generally in Australia. We were previously almost entirely dependent upon the great overseas combine, which reached out even into New Zealand, and from which, by the way, I think we still buy some of our long-fibre pulp. I refer to the Bowater concern. Until we got our own industry going, we had to pay for our failure to develop an Australian paper industry. The development of a paper manufacturing industry, with all its ramifications and subsidiary activities, such as the use of the coarser materials for lightweight packaging which has, to a large extent, taken the place of wooden cases, has been of enormous value to this country.
Some reflection has been cast on our tariff enforcement arrangements and our tariff machinery generally, by way of references to the Australian paper and pulp manufacturers. There has been, at times, some confusion in the minds of many people about the difference between the Australian Paper Manufacturers Limited and the other undertaking, Associated Pulp and Paper Mills Limited, which is older and has been very much more lucrative in the past. I remember clearly that within the last decade Australian Paper Manufacturers Limited made an application to the Tariff Board for certain protection, which was refused on the ground that the business structure of the company, particularly on the managerial side, was not satisfactory. The board said, “ First put your own house in order and then come back and ask us again for a review, and we will see what we can do “. As a result, this great and expanding concern was obliged to put its affairs on a more economic and successful footing. When my friend talks about fat lambs - no doubt he was thinking about paper-bag cookery as a means of linking the subject with that of paper - he might also consider the position of a neighbouring country which is only just now developing its manufacturing industries, and which would have been in a far stronger economic position at the present time to meet the threat of Great Britain’s entry into the European Common Market if it had given more attention to secondary industries in the past.
I am one who profoundly believes, as the executive of the Australian Country Party has consistently urged, that an economic survey should be taken with a view to removing the imbalance between primary and secondary industries. I believe that the encouragement and protection of our secondary industries is of prime importance. I think that in such a survey the practices of certain overseas companies should be given very close scrutiny. I can recall the case of a certain company in England selling a product to a subsidiary company in Australia. That product was being sold chiefly to subsidiaries in Australia and elsewhere that were producing exactly the same product, which was vitally necessary to a very important primary industry. In such circumstances you get to this position: Because the product is sold to our industry at a rate that is too high, that industry has to go to the Tariff Board to seek higher protection against the very product of the company that is making the rake-off overseas. The practice may not be widespread, but people with a knowledge of business have a shrewd suspicion as I do that it has been somewhat overworked. It is high time there was a searching probe into it. I believe that fair play is bonny play. The practice to which I have referred is not fair to the Australian consumer or the Australian manufacturer; nor is it the type of practice that should be permitted to continue.
I hope I have made the point that a paper industry wholly financed by Australian capital is a most important asset to this country. I do not agree with the conclusions arrived at by the honorable member for Wakefield, but I must applaud the spirit that prompted his approach to this subject.
, - I have been very interested in this debate. The expressed intention of the honorable member for Wakefield (Mr. Kelly) to make so many speeches on these tariff proposals made me think of the days when people wanted to flood the Australian market with cheaply produced overseas goods without any regard to the effect that those goods would have on this country’s industries. The honorable member referred to the tariff of 5s. a square foot on conveyor belting. He told us what that would amount to in the case of a large belt used in wheat silos at our seaports. The honorable member for Lalor (Mr. Pollard) attempted to point out to the honorable member for Wakefield that the tariff of 5s. a square foot was not high when one had regard to the amount of wheat that would be handled during the lifetime of any one conveyor belt.
The honorable member for Wakefield seems bent on reducing the amount of protection afforded to Australian industries. Has the honorable member ever considered which is the best market for our primary products? I ask the honorable member to consider the position of Australian storekeepers who sell eggs. The egg boards tell the storekeepers that they shall pay so much for the eggs they buy and that they may charge so much when selling them. The highest margin that the storekeeper may obtain is, I think, 7d. a dozen for handling the eggs. Is that not a trade practice? Is that not an action designed to prevent people from selling eggs at whatever price they wish? Take the position of the poultry-farmer. The honorable member will agree that the farmer should sell his eggs to the egg board at a price fixed by the board, and that if the farmer sells his eggs elsewhere for less than the price fixed by the board, he should be penalized. Is that not a trade practice in the interests of the industry? Purchasers are compelled to pay the price fixed by the egg board. Yet when it comes to protecting an industry that gives employment to Australians and keeps money in this country, the honorable member says, “ Never mind that. Chop off the protection and let the £5,000 be sent overseas even though it will impair our trade balance “.
The honorable member for Wakefield clearly adopted that argument. He has shown that he is willing to grab at anything in a report that will support his case for a reduction of tariffs. I do not propose to say anything about the Special Advisory Authority increasing a tariff to £9, then £20 and finally £30 or more, but I remind the honorable member that the Government of which he is a supporter does not believe in import licensing. It believes in allowing the Tariff Board to provide protection to those industries that need protection. We have heard recently the honorable member for Mallee (Mr. Turnbull) pleading the cause of the citrus-growers. We have been told that citrus juices are being imported into Australia at a price Which makes it impossible for Australian citrus-growers to compete. All I can say is that honorable members opposite cannot have it both ways. They cannot have tariff protection for primary producers and at the same time seek the removal of tariffs on imported rubber belting or paper, which protect the employment of workers in Australian industry.
– What you say would have some meaning if the citrus-growers had tariff protection, but they do not.
– It is the principle that matters. Is the honorable member for Wakefield prepared to speak out at his party meetings against the wrongful trade practices that have been mentioned here? Whenever suggestions are made that controls should be introduced the honorable member and his colleagues say that everything may be left to private enterprise. The Government claims that it is a private enterprise government and that it does not believe in interfering with the affairs of companies. The honorable member for Wakefield supports that view.
I agree with the views expressed by the honorable member for Lalor (Mr. Pollard). The Australian Labour Party is a protectionist party. We believe that the Government has an obligation to see that industries deal fairly and squarely with the people. We have heard that view expressed to-night by some honorable members opposite. I will not forget what they said. I will remind them of their remarks whenever necessary. I am satisfied that they have expressed those views not with any idea of curbing the avarice of private enterprise but with the idea of reducing -costs in this country. In my early political career, in the late 1920’s, I read a booklet prepared by the late Mr. James Scullin. He dealt with protection and referred to what was happening in Argentina with regard to harvesters. The Australian Government at that time had imposed a tariff in order to protect the harvester manufacturing industry in this country. The honorable member for Lalor will remember what happened. When the government of the day imposed that tariff, members such as the present honorable member for Wakefield protested against it. In those days we were endeavouring to afford some measure of protection to Australian industry.
I have been prompted to take part in this discussion not just by my interest in the question of protection for the papermaking industry. The honorable member for Barker (Mr. Forbes) has been quiet while this matter has been discussed. He knows what the Premier of South Australia is doing in endeavouring to have a big pulp mill established in that State. The honorable member knows very well of the pulp mills at Snuggery, near Millicent, in his electorate. He knows what was done and the protection that was needed. He knows of the use that was made of the thinnings from the pinus forests in the south-east of South Australia in the making of paper pulp. The honorable member knows what is required in the paper industry in his electorate, but he has been quiet this evening because he is on the horns of a dilemma.
– Order! I remind the honorable member that that matter is not before the committee at this stage.
– I am discussing protection for the paper-making industry, Mr. Chairman. The honorable member for Barker knows very well what has been done for the protection of the paper industry in South Australia. Establishing a paper mill is not like opening an electrical appliance shop or a small timber mill. If one wants to establish a big pulp or paper-making plant, one needs a large amount of capital. Such an enterprise costs a lot of money. As I have said, the honorable member for Barker is in something of a dilemma this evening. He cannot stand up for protection for the paper manufacturers in the interests of the local production of paper without going against the honorable member for Wakefield.
If the Tariff Board 01 the Special Advisory Authority has made any error in these matters, they are the ones to adjust th: situation. It is not for us here to override the authority that was expressly established to provide short-term protection. I recall that when this Parliament was considering the legislation which established the procedure for giving short-term protection, the honorable member for Lalor questioned whether any authority should have the power to do this without the matter first coming to the Parliament. He was told that the special procedure could be followed and that the matter could go to the Tariff Board within six months and then come to the Parliament for the Parliament to express its opinion, and that, if the Parliament considered that the additional protection given was unnecessary the matter could be taken up again.
I for one want to make it clear that 1 stand for adequate protection for the industries of this country. I stand for the employment of our own people in paper mills and rubber mills, for example, in the production of the things that we need and can manufacture here. At this point, Mr. Chairman, let me remind honorable members briefly of the £5,000 rubber conveyor belt that the honorable member for Wakefield mentioned earlier.
– The £5,000 represented the duty on such an imported belt.
– I do not know what the total cost of importing such a belt from the United States of America would be. A heavy freight charge would be incurred in bringing a belt from the United States or from any other country. Has the honorable member considered the wages that would be paid to the workers in this country engaged in the manufacture of such a belt and to those who transported it from the factory to the point of use? Has he considered whether the total of those amounts would be more than the £5,000 additional cost that he mentioned?
I know that the honorable member for Wakefield considers that we in this country are inclined, through officialdom and our tariff authorities, to go to extremes in protecting Australian workers. However, I have found, Sir, that people in business in a small way who seek my help in obtaining protection find that they have a terribly bard job to convince the Tariff Board of the need for additional protection for small industries. So I cannot accept the arguments that the honorable member for Wakefield based on various figures that he quoted, such as company profits. Has the honorable member ever considered the question of duty on imports of rubber tires, which are so much in demand for motor cars? He does not worry about how much the Australian manufacturers of tires make. Trade practices enter into the motor industry, also. One cannot buy an English Morris car or a United States car here without paying a price fixed by some trade practice. Trade practices enter into all these things.
-We are not discussing trade practices.
– The arguments of the honorable member for Wakefield on trade practices will not hold water in the opinion of the people generally.
As I have said, I am prepared to leave the question of raising duties to the Tariff Board. Let those who consider that they are hit by higher duties approach the board for reductions of duty.
.- Mr. Chairman, I had not intended to speak on this matter, but I have been provoked by the honorable member for Port Adelaide (Mr. Thompson), who has reflected on my courage. Had he been in the chamber this afternoon, he would have heard me discussing other Tariff proposals. As he was not present, he probably was not aware that I had done so. The honorable member spoke about accepting the authority of the umpire - accepting the reports made by the Tariff Board and the Special Advisory Authority. I remind him that this afternoon he voted against the acceptance of proposals based on two recommendations made by the board. In other words, what the honorable gentleman says is that we ought to accept a recommendation for higher tariffs and that we should not accept a recommendation for lower tariffs.
When I spoke earlier this afternoon on the subject of duty on polyvinyl chloride, I made a point that is applicable to the challenge that the honorable member has just thrown out to me. That point related to some of the possible dangers, not of protection, but of excessive protection. I pointed out that where, as in the manufacture of P.V.C., only one firm waa engaged, the provision of what may be called excess protection encouraged others to enter the industry. Something very similar applies to the paper pulp industry.
The honorable member for Port Adelaide said that I had not been game to speak about the paper-making industry because of proposed developments in the timber industry in South Australia and in the manufacture of paper pulp in my electorate. It is true that certain developments are proposed. Cellulose Australia Limited operates a paper pulp plant in my electorate which is relatively minor compared with the establishments of other companies making paper pulp. The company in my electorate, I am very glad to say, has been able to hold its own. It looks as though another company will be able to establish a large-scale paper pulp industry in the south-east of South Australia, and we all hope that this will be done successfully. The situation in this industry is very similar to that in respect of the manufacture of polyvinyl chloride. Experts tell us that when the company that I have mentioned, with overseas backing, establishes itself in the paper pulp industry in the south-east of South Australia, there will be an enormous amount Qf excess capacity in the .-industry, compared with the foreseeable demand for paper pulp on the Australian market.
Even if the Australian manufacturers of paper pulp command 100 per cent, of the Australian market, some section of the industry will go to the wall if the new industry is established in South Australia. I am not worried about the firm in my electorate. Because of its connexion with the huge Canadian companies, it has very much greater financial resources and very much greater expertise than either of the Australian firms, however big they may be: It will not be that company1 which will go to the wall. Perhaps those we are discussing now will be the ones which will find themselves in difficulties. It will not be the people in my electorate who will be thrown out of employment. lt will be the people in the electorates of the honorable member for Mcmillan (Mr. Buchanan and the honorable member for Wilmot (Mr. Duthie).
This is the kind of situation which excessive protection encourages. Surely this is something we should try to avoid. By all means invest in an Australian industry and give it a reasonable share’ of the market, but do not bank on protection to the point at which” you encourage every man jack into the industry arid cause great hardship in those areas where the industry is already established. I repeat that I have no worries about the firm in my electorate. I will back this overseas company to beat Australian Paper Manufacturers Limited and Associated Pulp and Paper Mills Limited hands down.
As any expert will tell you, one thing is absolutely certain: If this firm goes into the south-east of South Australia, with the capacity and the investment which already exist in the industry, there will be enormous excess capacity. As I said earlier to-day in relation’ to P.V.C, we face the danger not of protection but of excessive protection.
Questions resolved in the affirmative.
Customs Tariff Amendment (No. 27).
Consideration resumed from 8th August (vide page 94), on motion by Mr. Fairhall -
That the Schedule to the Customs Tariff 1933-1962 as proposed to be amended by Customs Tariff Proposals, be further amended as set cut in the Schedule to these Proposals . . . (vide page 93).
– Again . in this case there is only one item. Is’ it the wish of the committee to consider the motion as a whole? There being no objection, that course will be followed.
.- I feel somewhat hesitant to participate again in this debate. I set out originally to state my views in a spirit of mild criticism of the inquiry but obviously I have stirred up the committee to such an extent that I feel quite embarrassed. However, I think that I should continue. On this occasion I intend to refer to the, duty imposed on stationary engines. Again, this is one of the items which has been the subject of a series ‘ of reports. Indeed; there have been so many reports that it sounds like an artillery Barrage:
In April, 1961, the Tariff. Board reported on all engines and’ lawn mowers and recommended a duty pf. £6 10s., which if approximately 55 per cent., on smaller engines. In October, 1961, the deputy chairman reported on four-stroke engines under 10 horse-power, with horizontal shaft, used mainly in the pastoral industry. He recommended a 10 per cent, increase in the duty making it 65 per cent, on smaller or cheaper engines and 52i per cent, on larger engines.
Then the Special Advisory Authority came into the picture because it was felt that the seven companies engaged in the manufacture of these engines were not receiving all the protection that they should have been receiving. He recommended that the duty be increased to 77i per cent, on some engines and a good deal more than that on Clinton engines in relation to which the rate has risen from 42) per cent, to 85 per cent, within eighteen months. On the American Briggs and Stratton 2 horsepower engines the duty works out at 93 per cent, and on the 4 horse-power engines, at 73 per cent. The main reason given to justify these high duties was that there was not sufficient output to carry the high overhead cost of the machinery which is needed to produce engines efficiently. As I have said, seven companies were engaged in the manufacture of these engines. But since the higher duties have been imposed the number of factories producing these engines has increased from seven to nine, so there will be even less output per factory now to carry the high overhead cost of manufacture. Costs have risen, so fewer engines will be sold and, in turn, there will be still less output to carry the high overhead cost of manufacture. This is the position which arises from the introduction of this foolish kind of panic legislation.
To me, these engines are tools of trade. I now have six engines on my farm, although I did have eight. One of my engines drives a lawn mower and the other five also work for their living. One of the engines is on the fire plant. I suppose I could use a wet bag. Another engine is on the windrower, but I suppose I could use a scythe. And 1 suppose I could go back to turning the winnower by hand. I have an engine which drives the spray cart, but I suppose I could use a hand pump. I suppose that I could manage without engines as my father did, but I have been urged to be an efficient producer. I have been told to produce to the maximum at the lowest possible price. That is all very well. But when I go to buy the essential tools of trade to enable me to do this I am annoyed to find that they are 93 per cent, dearer than those produced by overseas competitors. I find it very hard to reconcile these two points of view.
.- We are now discussing item 27 which relates to the manufacture in Australia of four-cycle interna] combustion engines of small horsepower. I have listened attentively to the case submitted by the honorable member for Wakefield against increased tariff protection for this kind of engine. I grew up in the industry associated with the manufacture of internal combustion engines and, going back even 40 years, it has been one of my proud boasts that I have always forthrightly defended and supported the capacity of Australian manufacturers to make internal combustion engines which are as efficient as those manufactured anywhere in the world.
The industry never could have developed in Australia if it had not received tariff protection. When we were absolutely dependent upon the capacity of Australian manufacturers to provide internal combustion engines for farms and industries, we would have experienced far greater difficulties than we did in fact experience, particularly in the critical wartime period from 1939 to 1945, if the Australian Labour Party in the 1930’s had not accorded this industry tariff protection.
The honorable member for Wakefield mentioned the cost of these products. The honorable member for Ballaarat (Mr. Erwin) will confirm that in Ballarat is manufactured an effective and efficient internal combustion engine within the power range of one and a half and three and a half horsepower. There is made a prime mover of quality, not second to anything anywhere in the world. The manufacture of such an engine has been made possible only by tariff protection. If you say that Ronaldson Brothers and Tippett Limited of Ballarat or James N. Kirby Automotive Proprietary Limited of Sydney or Villiers Australia Proprietary Limited, an overseas company which has come to Ballarat to manufacture internal combustion engines behind the tariff wall, are inefficient, or that they are profiteers, or that they are acting in combination to exploit the Australian producer my reply is this: The Government has the power to draw from these companies taxation to the extent that they exploit other people. If it is alleged that these companies act in combination to exploit people my reply is that for a number of years the Government has proposed to introduce restrictive trade practices legislation to deal with such a situation but it has neglected to proceed with such legislation.
Always and ever in the manufacture of these products Australian-born workmen are employed. Men and women work m these great secondary industries, many of th6m centred in provincial cities. Those men and women consume Australian primary products and it is up to this Parliament to see that these secondary industries are encouraged and protected against the adverse competition of cheap labour countries. In thi absence of a protective wall in Australia those countries would exploit our people to a much greater degree than it is alleged Australian manufacturers now exploit them.
If ever there was a period in Australian history when it behoved this Parliament to give protection to local manufacturers for all secondary products it is now. If ever there was a period in our history in which it was essential for a responsible government to put into operation protective machinery for manufacturers it is now. If ever there was a period when we should drain off excess profits from Australian manufacturers it is now. If the Government doss not do those things it is no reason why the Opposition should deprive the Australian manufacturer of the wherewithal to expand his industry and supply our need.
It is the responsibility of the Government to do those things which the honorable member for Wakefield, on behalf of the primary producers of this country, says should be done. But there is no case, as suggested by the honorable member, to leave the manufacturers and Australian workmen - many of them sons of primary producers - shorn of all those inducements which will enable them to compete and provide the Australian community with all th; secondary products that it requires. The committee is considering internal combustion engines. It is considering four-cycle air-cooled petrol engines with horizontal driving shafts. How many honorable members know anything about a four-cycle engine? If honorable members want any information on the subject they may come to me afterwards and I shall tell them all about it. I leave it at that. We support this particular proposal with enthusiasm.
.- I go along for part of the way with the honorable member for Lalor (Mr. Pollard). It is very easy to say that we are going to impose a tariff to’ protect an industry. The fact is that we want fair tariffs. As a primary producer, I realize thai we need to have secondary industries in Australia. We need to have a lot of them. But we want efficient secondary industries. Australian industries, particularly those which are not subsidized, have had to build up their markets against world competition. In order to do so it has been necessary for them to work more than 40 hours a week. It has been necessary to use all sorts of means to meet advancing competition. I think we have to be grateful to the honorable member for Wakefield (Mr. Kelly) for stressing this fact to-day. I think the honorable member for- Wakefield believes that it is very easy for honorable .members opposite to support a 35-hour week, increased wages and other improved working conditions and then take it out of the primary producer with, increased tariffs. I think th,at is what is worrying the honorable member for Wakefield and it is worrying those of us who represent primary industry.
I know that” honorable members opposite who are interjecting like to divert attention to ridiculous subjects. We will get nowhere in Australia if we do not help the primary producer. In the past the British Navy has protected us and the United Kingdom has taken all our surplus products. Now we have reached the stage at which we have to sell elsewhere. What is more, we have to sell manufactured goods’ because until we can sell manufactured goods we will have what is known as a “ stop-go policy “. Our economy will be subject to the vagaries of climatic conditions and overseas prices. As I said before, we need tariffs* for industry. But most of ail we need fair tariffs. When we see large industries publishing very prosperous balance-sheets I believe that there is something wrong in our tariff system and I believe that we have to do something about it.
The honorable member for Yarra (Mr. Cairns) suggested the introduction of restrictive trade practices legislation. But he said that the history of restrictive trade practices legislation in the rest of the world was not very satisfactory. The honorable member for Lalor had his own ideas about the right approach to restrictive trade practices. So honorable members opposite have two different opinions which is not unusual for them. We are not dealing with restrictive trade practices but with tariffs.
– Order! I ask the honorable member to come back to the item before the committee. The matter under discussion concerns temporary duties on four-cycle air-cooled petrol engines with horizontal driving shafts.
– Thank you, Mr. Temporary Chairman, I think I have finished.
.- Mr. Temporary Chairman, I must support in this case the honorable member for Lalor (Mr. Pollard) because I am certainly convinced that the internal combustion engine industry is efficient. The honorable member for Lalor suggested that few honorable members would know anything about internal combustion engines and that few would know what a four-cycle engine was. I can assure the honorable member that I know something about internal combustion engines. I cannot understand the views of the honorable member for Wakefield (Mr. Kelly) on this matter. If we are to increase the population of Australia we can increase it only by expanding our manufacturing industries. What we have to ensure is that we have efficient industries. Are our secondary industries efficient? I am convinced that here is an industry that is efficient and does not make large profits. Honorable members might ask what is the reason behind these very high tariffs, particularly when our competition is coming from a country that has a very high standard of living; but once they examine the industry, the problem is very easy to understand. If they were to go through the
American industries, as I had the good fortune to do, they would be able to understand why the Americans can put internal combustion engines on the Australian market at such a low price. Firstly, with over 180,000,000 people compared with only 10,000,000 people, and with a very large export market, which we have not as yet, the Americans can afford to put in very expensive machinery that our local manufacturers could not possibly afford. Because these huge machines make mass production possible, the Americans can export engines to Australia at a very low cost. Either we protect our manufacturers or we let them go to the wall. So far as I am concerned I will go all out to see that our local manufacturers get adequate protection, especially when I know that they are operating efficient industries.
The honorable member for Wakefield (Mr. Kelly) mentioned something about a 10 per cent, tariff increase in April and, later on, a further increase. What happened last April was that when our local manufacturers got this 10 per cent, increase in their protection, the American manufacturers said, “ This is the end of season for us; we will just empty our stocks and give a 9 per cent, discount to Australia”. That is exactly what happened. They gave a 9 per cent, discount. They will always be able to do that because we are down under in the southern hemisphere and our seasons are the opposite of the American seasons. American manufacturers will always be able to empty their end of season stocks into Australia at a very low cost and, if need be, below cost.
Without prolonging the debate, I feel that I should say that this is a protection that was warranted. It is one industry that I was very close to while the Tariff Board inquiry was in progress, and it is one that I support. I feel that unless we continue to protect manufacturers such as the internal combustion engine manufacturers, we cannot develop Australia or increase our population as we want to increase it.
.- The Australian Labour Party supports high tariffs, but these discussions have produced further evidence of the widening gulf between the free trade Country Party and the Liberal Party over protection for our Australian industries. The honorable member who preceded me hit the nail on the head when he said we must protect Australian industries if we are to populate this country. The need to protect the internal combustion engine manufacturers is one of the reasons for the Labour Party’s support of high tariffs. It is quite evident that some Country Party members are parochial because they represent certain sections of rural industry, but these gentlemen have not the answer to the problem of finding employment for migrants. Can the primary industries provide jobs for our increasing population or for our migrant intake? Obviously they cannot. The Australian Labour Party will always support tariffs to prevent unfair competition from overseas.
A while ago we heard the honorable member for McPherson (Mr. Barnes) criticizing indirectly the 40-hour week. Why do he, his party and the Government not have the courage to get up at election time and say that they oppose the 40-hour week? It is all right for them, just after an election, to come into this chamber and say that they oppose it, but just before an election they remain completely silent.
The case put by the honorable member for Lalor (Mr. Pollard) proved beyond all doubt that this is an efficient industry. Therefore, the Australian Labour Party Opposition supports these tariff proposals for the protection of this industry and the protection of Australian workmen’s jobs.
– Mr. Temporary Chairman, in this matter I support the Government and, I am afraid, I must take issue with my friend the honorable member for Wakefield (Mr. Kelly). I feel that in his approach to these matters he has shown a certain pattern of thought, and it seems to me that he puts himself up as an opponent of protection, perhaps irrespective of the items that are coming forward.
– No, that is not fair.
Mr. WENTWORTH__ I said, “Perhaps”. I think this is right; I think this shows an attitude of mind which is both mistimed and misjudged. I say that it is mistimed because we need, at this present moment, more and not less effective protection. This can be shown by looking at out trade fijur.es and bv realizing that this year, on current . account, we will have a deficit of the order of £300,000,000. This is a trend that cannot be allowed to continue. It may well be - my friend, the honorable member for Wakefield, might agree with this - that this will be partly offset by a change in the exchange’ rate, but if this were not to be done then we would need a greater degree and not a less degree of effective protection.
Then there is the other problem that our economy is not yet working at its full tempo. When we give out additional purchasing power, as we must, it should be “our business to see that not too much of it spills over into imports and, for that reason, again the Government is right, and the Government’s policy of increasing effective protection is a correct policy.
Let me go on to something rather more fundamental and this, I think, is of the essence of the matter. All over the world it is now being realized that an economy cannot be a stable economy if it has too great a dependence upon overseas trade.
Order! I suggest to the honorable member that he is ranging over rather a wide field. The committee is not discussing anything more than the tariff on four-cycle engines.’
– In that case I shall have no more to say at the moment. I simply go on record as saying that I support the Government’s policy of protection for Australian industry.
.- I should like to state my interpretation of the Country Party’s view of the subject now before the committee. The Country Party has always supported protection for secondary industries, but has always added the qualification, “ But not at the expense of the primary producer “. In this debate the honorable member for Wakefield (Mr. Kelly) spoke about stationary engines which, qf course, are used by primary producers. To my mind the honorable member for Wakefield has put the case that the tariff on stationary engines may put the price up to a level that will be detrimental to the primary producer: On the other side we have the case put by the honorable member for Watson (Mr. Cope), that the Labour Party is always in favour of protecting industries and is in favour of high tariffs to prevent overseas interests from coming in and capturing the market from the Australian product. That is noteworthy, too. We have the two things together and there must be a fine dividing line between them. Surely no one in this chamber would suggest that tariffs on machinery such as stationary engines should be so high that they would make the economic outlook of the primary producer more difficult! Surely everybody realizes that primary production is the basis of Australia’s stability! The irony of the situation lies in the fact that secondary industry has priced itself out of world markets and has made prices in Australia very high. That is proved by the fact that only 20 per cent, of our exports come from secondary industry and SO per cent, from primary industry.
Secondary industry in Australia cannot operate inside its own price structure, and expects primary industry to pay for everything it needs to, manufacture its products on this high priced secondary industry market. Yet primary industry supplies 80 per cent, of our exports, which are sold overseas in countries which have lower standards of living and lower prices than ours. That state of affairs just cannot continue, Mr. Temporary Chairman, if the price of stationary engines and things of that nature are so high as to be prohibitive to primary producers. Both the Opposition and the Government, including members of the Country Party, should know that most of our secondary industries cannot continue to operate satisfactorily unless we have healthy overseas balances with which to buy raw materials that are necessary to them.
The TEMPORARY CHAIRMAN.Order! I ask the honorable member to confine his remarks to the tariff item before the committee. We are dealing with import duties on four-cycle air-cooled petrol engines with horizontal driving shafts.
– These are not very different from other engines, Mr. Temporary Chairman, although, of course, there are some differences. If the price of these engines in Australia is forced too high by means of tariffs, the effect will be detrimental to our economy. If the Special Advisory Authority or Tariff Board has looked into the matter carefully and is quite sure - as the member for Ballaarat (Mr. Erwin), who represents the primary producers too, said - that these engines are not priced so highly as to interfere with the economy of our primary industries, which is one of the main sources of our national wealth, I will be satisfied.
– Mr. Temporary Chairman, you have been quite right in pulling up some honorable members for wandering off the subject. Although reference has been made to the use of four-cycle engines on farms they are not necessarily farm engines.
– What is the difference between a four-cycle engine and a twocycle engine?
– Two cycles!
– I, like some other members who have spoken to-night, have a couple of engines on my farm. The report from the Special Advisory Authority which dealt With this subject shows that the authority handled the evidence on its merits. In that report we find James N. Kirby Automotive Proprietary Limited, Ronaldson Brothers and Tippett Limited, Villiers Australia Proprietary Limited and other manufacturers mentioned. As the member for Ballaarat (Mr. Erwin) explained, the production of these engines has been seriously reduced, as the result of competition by engines manufactured overseas. The report of the Special Advisory Authority states -
The Australian industry based its case for increased assistance mainly on a decline in its production, sales and employment caused by competition from imports.
Further on it states -
Imports of engines (including engines with vertical shafts) in at least one recorded horse-power range are rising steeply.
The evidence on which the Special Advisory Authority based his findings is mentioned and he worked out from the figures he had, but which are not before us, the degree of protection necessary. In its evidence the Kirby company pointed out that, in addition to the fact that its production was momentarily down, it had not received any firm orders for the supply of vertical shaft engines from lawn mower manufacturers for the coming lawn mower production season. At that time the position was really serious. Now that the lawn mowing season is in full swing the papers are full of large advertisements competitively pushing the sales of various brands of lawn mowers. In the last two weeks I have noticed a very good choice of makes and models of lawn mowers advertised. With one exception, in an advertisement by a chain store which is not deeply interested in supporting Australian industry, all the lawn mowers advertised had Australian engines. I think this is the result of the finding of the Special Advisory Authority, which put these factories back into production and gave increased employment - the very things which the authority was set up to do.
Question resolved in the affirmative.
Customs Tariff Amendment (No. 28).
Consideration resumed from 8th August (vide page 95), on motion by Mr. Fairhall -
That the Schedule to the Customs Tariff 1933- 1962, as proposed to be amended by Customs Tariff Proposals, be further amended as set out in the Schedule to these Proposals . . . (vide page 94).
– Is it the wish of the committee that this motion be taken as a whole? There being no objection, that course will be followed.
.- This item deals with insecticides and weedicides. I find it somewhat difficult to stomach.
– Perhaps it is poisonous.
– I agree with the honorable member for Perth (Mr. Chaney) and think that this decision is as poisonous as the product it deals with. Whatever one may say about the general level of protection for Australian industry, what justification can there be for protection which may mean high prices for products that are used virtually exclusively by primary industry? The only point on which I agree with the honorable member for McMillan (Mr. Buchanan) is that you cannot relate the question of stationary engines solely to primary industry, but must take into account the fact that they are used for many other purposes. That is not so in the case of insecticides and weedicides, unless we include among the users people who have these products to kill flies in their homes or pests in their gardens.
These products are used principally in primary industry. Protection for any article means higher costs for the primary sector of our economy. I am not a free trader nor, I believe, are most primary producers. Protection at reasonable levels for economic and efficient industries is necessary in order to achieve the objectives which are shared by both farmers and other sections of the community. In this respect the farmers accept economic disadvantages for the sake of other and non-economic advantages - for example, the building up of population, full employment and so on. But one thing that the farmers do expect is that the policy will be administered successfully and with a sense of proportion, and with the knowledge that the primary industries are placed at a disadvantage. What happens when we apply these criteria to the decisions on insecticides and weedicides? On the one side you have the primary producer, the principal user of those products. He is struggling in the face of difficulties. This is particularly so in the case of those who are competing on world markets. They are struggling in the face of higher costs and lower prices to compete with people outside this country. Such a man has to use insecticides and weedicides, at worst, if he wishes to have an income at all, and at best if he wishes his produce to be of the best quality - insecticides and weedicides, which are expensive by any standards, even if obtained from the world’s cheapest sources. Insecticides and weedicides are commodities which only the primary producer uses. He is making, in many cases, a return on capital of 2 per cent, or less but, unlike the manufacturers of the weedicides and insecticides, he cannot use the argument of an inadequate return on capital as a basis for preferential treatment in the form of protection.
That is the primary producer’s side of the picture. Let us look at the other side - that of the producers of the insecticides and weedicides to whom, as a result of these duties, we are providing very high protection indeed. They are giant chemical firms with international connexions like I.C.I, and Monsanto, and the manufacture of insecticides and weedicides represents only a small proportion of their vast operations. The number of people directly they employ in producing insecticides and weedicides is small. The Special Advisory Authority accepts their arguments that the selling price necessary to compete with imports is too low to give them what is regarded as an adequate return on capital. Note the contrast with the case of the primary producer.
It is specifically stated by the Special Advisory Authority in two successive reports - this matter has been to him twice - that increased duties are recommended without any inquiry into the cost of the basic raw materials. In fact, both the Tariff Board and the Special AdvisoryAuthority make it quite clear that they are not in a position to determine the cost of the basic raw materials, even though the Tariff Board and the Special Advisory Authority admit this to be a very large proportion of the final cost and the principal reason why the cost of producing these insecticides and weedicides in Australia is so much higher than similar costs overseas. The higher cost is not due to higher labour costs but is principally the result of higher costs of raw materials. Even though the Tariff Board recommended a duty somewhat lower than the original duty plus temporary duty, but still higher than the previous temporary duty, the Government, for some reason known to itself, decided not to implement the Tariff Board’s recommendation and referred it back to the Special Advisory Authority. Naturally, in view of his recommendation a few months before, he recommended that the original duty that he had proposed be re-instituted.
Those are the two sides of the picture, and I ask the committee: Where is the balance and the common sense and the justice in this? You do not have to be a free-trader to see this as what I describe as dogmatic protection run wild. There seems to be no balance, no discrimination, no perspective in it. I ask any member of this committee to consider what he would think if he were a wheat-farmer in, say, the electorate of Mallee, with the economic life being slowly choked out of his farm by skeleton weed - a matter which the honorable member for Mallee (Mr. Turnbull) has brought to the attention of this Parliament so often. What would an honorable member think if the economic life was literally being choked out of his farm by this weed and he had to use increasing quantities of weedicides, par- ticularly 2,4-D, which is mentioned in this report, to continue to earn a living? What would he think on hearing that the price of this product is to go up, not because the costs of production have increased, not even because the chemical manufacturers are indulging, so far as I know, in restrictive trade practices, and not even because of the need to provide employment for Australian workers, but because a governmentestablished authority believes that the I.C.I, interests are entitled to increase their return on capital - not from 2 per cent, to 2i per cent., as would be the case with the wheat-farmer in the Mallee or the wool-grower in my electorate, but from 10i per cent, to 11 per cent.? Would not such a wheat-farmer be entitled to think that the game was not worth the candle, and that in view of the fact that he and others like him produce 80 per cent, of our export income something had gone badly astray?
I know that both the Tariff Board and the Special Advisory Authority say that it is in the best interests of the primary producers that those products be manufactured in Australia. But they give no evidence to support this. There might be good evidence to support it, but they do not state it. One thing that one could suggest as evidence in support is that if these insecticides and weedicides were not manufactured in Australia we could be held to ransom by foreign producers. But the world market for those products is so highly competitive that there is very little danger of that happening.
Neither the Tariff Board nor the Special Advisory Authority gives any evidence to show that the industry in Australia would go out of existence without these high rates of duty. I doubt whether it would go out of existence because the firms concerned are huge and the production of these commodities is marginal to their total production. In any case, if it is found after adequate investigation that it is necessary to have this industry in Australia for the benefit of the primary industries, perhaps so that the local producers could meet a sudden demand from Australian stocks, then surely assistance to the local industry producing this product so vital to primary industry, and used almost exclusively by primary producers, can be given by way of bounty rather than by a duty which will increase thi prices. That is my plea to the Government in this case, and there is a precedent for such action. The Government took that action - and rightly so - in relation to nitrogenous fertilizers, a similar product which is used almost exclusively by the primary industries and which enters so largely into their costs of production. The Government decided that it was necessary to have an Australian industry producing nitrogenous fertilizers and, instead of imposing the very high duty which would have been necessary to protect the local industry if that course of action had been chosen, it gave the industry the protection of a bounty, and the price immediately went down. I appeal to the Minister and to the Government to have another look at this matter and see whether the protection cannot be provided by the same means.
.- I very much appreciate the intervention in this debate also by the honorable member for Barker (Mr. Forbes). Everything that he has had to say has been, as usual, valuable and carefully thought out. I do appreciate his support.
Of all these examples of unnecessary and unwarranted increases of duty, this is perhaps the worst- -and that is saying a good deal. Let us consider, first, the weedicide 2,4-D. This is a product that is commonly used on my farm and on farms throughout Australia. It is manufactured by the group of companies which include Monsanto Chemicals (Australia) Limited, Union Carbide Australia Limited, and Imperial Chemical Industries of Australia and New Zealand Limited. Sir Frank Meere, the Special Advisory Authority, does not bother to tell us the extent of the imports. He just says that Australia produces over 91 per cent, of the demand. Obviously, therefore, excessive imports do not constitute the trouble. But, he said, the local manufacturers are not getting enough, and he has recommended increased duties specifically for the purpose of allowing them to increase their prices from 4s. 3d. to 5s. Id. He does not hide anything, he sets it out for all to see. So we do not have price-fixing in the downward direction, we have it in the upward direction.
Now take the case of the insecticide, D.D.T. In 1959-60 Australia produced 84 per cent, of the demand. Imports fell during the next year, although Sir Frank Meere does not tell us how much D.D.T. came in. Obviously imports were not the real trouble. The trouble was, of course, that the manufacturers were not able to charge enough for their products. That is what Sir Frank Meere says. But he has remedied the situation and has allowed them to raise their prices. He has imposed a duty which amounts in total to 124 per cent, if you include the dumping duty. If you take out the dumping duty it is 91 per cent. Sir Frank has allowed the manufacturers to increase the price from 3s. to 3s. 3d. per lb.
The original rate of duty imposed, on both 2,4-D and D.D.T., increased spraying costs on my farm by £100 a year on my estimate. These emergency duties will further increase spraying costs by from £30 to £50. It is very hard to get an exact estimate because it is difficult to ascertain the f.o.b. price. In any case, it would appear to be a very considerable extra impost for me. This does not allow for the formulators’ profit, which has been referred to. This is the extra cost which can be justified by the Special Authority’s advice to the industry as to the margins by which prices can be increased. The burden of these additional duties will amount to between £30 and £50 annually according to the spraying programme that I follow on my own place. But I suppose it does not matter about me. I merely produce for the export market. I have no political friends. I am not supposed to worry about these extra burdens so long as the big companies are content. And they are content! Let me quote some statements that appeared in a half-yearly report of I.C.I. This is good reading -
The downward pressure on selling prices continued during the six months to March 31. However, consolidated group profit of £1,427,000 (after increased provision for taxation and depreciation) showed an overall improvement of almost 8 per cent. The result has been aided by further efforts to improve efficiency and reduce costs of operation and-
I emphasize this - by the granting of emergency tariff protection for some of the group’s more important products . . Should profits earned in the second half of the current financial year continue at the same rate as in the first, earnings rate on average capital employed would appear to be 10.8 per cent, per annum.
So I can take some comfort from this. Though I may feel depressed at the fact that my spraying costs have increased by from £30 to £50 a year, at least I.C.I, is happy.
Since the report of the Special Advisory Authority was received, a full Tariff Board report dealing with chlorine products and weedicides has been presented. This report recommended increases of the original duties on most of these weedicides and pesticides. It recommended duties higher than those that were in operation before the board commenced its inquiry, but of course the duties recommended were not nearly as high as those suggested by the special authority. In fact the board recommended a duty of 40 per cent, on D.D.T., whereas the special authority’s contribution to the problem was a recommended duty of 90 per cent, to 100 per cent.
However, the Minister, after sitting on the board’s report for two months - and if the duties are to go down there is always a long incubation period - did not accept the Tariff Board’s recommendation, and has left in operation the high duties recommended by the Special Advisory Authority. His reason for doing so is that the Tariff Board stated that, just as its report was being prepared, new evidence was presented by Union Carbide and Monsanto. We do not know what this new evidence is, because we are not told. All we know is that the additional burden which primary producers were asked by the special authority to bear is to continue in operation, in the face of the report by the Tariff Board. The matter has now gone back to the Special Advisory Authority and must again go back to the full board.
It is interesting to compare the difference in the approaches of the Tariff Board and the Special Advisory Authority. The comments in the two reports on paradichlorobenzene, which I shall call P.D.C.B. for simplicity, are revealing. The Tariff Board said -
As a result, and taking into account the overall profitability of its integrated production of chlorobenzenes, the board is of the opinion that ad valorem rates of 25 per cent. British preferential tariff, and 32i per cent, most favoured nation (the existing rates for P.D.C.B.), would provide a reasonable degree of assistance to Union Carbide in its production of P.D.C.B. The board proposes to recommend accordingly.
However, the approach of the Special Advisory Authority was quite different, and I think the committee should look closely at this because it is most interesting. The authority said -
The industry’s current list price of £197 10s. per ton is not competitive with the current dutypaid landed costs of the imported material and does not cover local manufacturers’ total production costs. If the requested temporary duty of 3d. per lb. is granted, the industry proposed to advance its price to £215 per ton.
Well, as I said before, you must pay a tribute to the Special Advisory Authority for frankness in these matters. The Government seems to have a grim determination to protect large companies at the price of grievously increased costs to farmers who have to sell on the export market. Let me put it again on a personal basis. Honorable members have been taunting me with the accusation that I have approached this matter from a narrow, parochial viewpoint. Well, I accept the criticism. The previous protection granted increased my spraying costs by £100 a year. This additional duty will put them up further by £30 to £50 a year. In other words, when I come to sell my wool overseas in competition with other countries that are not cursed with a local uneconomic chemical industry, I meet my competitors on £150 worse terms. And, by the way, the engine that I use to drive my spray plant will cost me more, because I will have to pay 93 per cent, duty on it. This does not improve my temper, either.
As a matter of fact, my temper has not improved at all during these spring months, despite what the poets may suggest. At this time of the year Ministers of all shapes and sizes, when opening the spring shows, exhort me, with magnificence eloquence, to reduce my cost of production, so that I can meet world competition. They then go on to urge me to produce goods of better quality. It is wonderful to listen to, and it is also pretty to watch. The Ministers always seem to place their hats reverently across their stomachs when speaking, as if to emphasise their earnestness. I know that in times gone by people used to place their hand across their heart to do that. Standards seem to have slipped somewhat. After the ceremony has finished, the official party has left the arena and the desultory applause has limped to a lame conclusion, I am left to wonder how I am to reduce my costs of production and improve the quality of my produce if the price of so many things that I buy is so much higher than my overseas competitors have to pay. If this kind of thing continues the Government must face the grim alternative of having to subsidize wool-growing. If this is the Government’s intention it should start to put some money into kitty, because the sums required will not be paltry. It will cost over £8,000,000 to subsidize the Australian clip by Id. per lb.
I repeat that if increased costs are to be loaded on to our shoulders in this way there can be no alternative but to introduce a subsidy. The Government should realize that. If it is necessary to afford protection to the local chemical industry, surely that protection should be afforded by way of a bounty which is paid by the taxpayer instead of by way of a tariff which is paid by the exporter.
I regret to have to make this speech in serial form but reports come in continually. Since preparing the remarks that I have just made I have received two reports of the Special Advisory Authority. One of those reports confirms the emergency duties that he imposed earlier. That had to be done following the Minister’s refusal to implement the lower duties recommended by the Tariff Board on 28th June. The second report of the Special Advisory Authority recommends increasing to 40 per cent, the duty on 2,4,5-T, which is another weedicide. Evidently this industry was overlooked in the previous mad scramble.
So here we have protection of an uneconomic industry in the face of a considered opinion by the Tariff Board. In his last edition the Special Advisory Authority said -
An increase in duties on insecticides and weedicides must unfortunately result in increased costs for Australia’s important primary industries.
That is a moving passage. The authority continues -
I believe however that it is in the primary producers’ interest to have these products manufactured in this country. The fact that the recent unexpected heavy demand for weedicides was successfully met by the Australian manufacturer supports this conclusion.
The Special Advisory Authority does not argue the case. He blandly remarks that we farmers are lucky to have the industry in Australia just because we have been able to get increased supplies when we wanted them. That seems to be a silly statement. You could think of many reasons to justify this Australian industry, but surely no one would try to use this argument even in extremity. After all, the evidence is that there are many manufacturers in other countries who are only too willing to supply what we want at much lower prices than we have been forced to pay. I would like the Special Advisory Authority to face a meeting of farmers and tell us how lucky we are to have this industry in Australia.
In these last reports the Special Advisory Authority has said that although the manufacturers raised their prices as a result of his previous report, the prices charged by the formulators went up by more than was justified. That may well be so, and I do not excuse it. I carry no banner for the merchants, but it seems to be a queer solution to this practice to increase the duty on 2,4,5-T by ls. 3d. per lb. so as to enable Union Carbide to increase its price also, so that the same thing may happen again.
As I have said, I do not defend the formulators, but perhaps they feel that they have as much right to a reasonable margin of profit and a fair return on capital as I.C.I, and Union Carbide. Or is the fact that they are not giant companies sufficient to preclude them from participating in his bounty?
.- The proposals now before the committee refer to weedicides and insecticides. Anybody who knows anything about rural problems knows that during the last decade there have been marked advances in the control of noxious weeds and pests. To-day we have counters to the cockchafer beetle and to the red-legged earth mite, to name just two insects. We have products that will control hoary cress, skeleton weed, St. John’s wort and Californian thistle. Formerly there was no control over those weeds. Fortunately to-day we have in this country the industrial capacity to produce all our requirements of weedicides and insecticides. The industries producing our weedicides and insecticides have been established as a result of the findings of research scientists in Australia and overseas.
I go a long way with the case presented by the honorable member for Wakefield (Mr. Kelly), who suggested that the impost tion of a tariff to protect Australian industries will enable those industries to exploit Australian primary producers. The honorable member claims that as a primary producer he spends £100 or £150 a year on weedicides and insecticides.
– Extra if you like. The honorable member for Wentworth, like the honorable member for Wakefield, complains about these imposts inflicted by his Government on the primary producers, but he lacks the political courage to condemn his Government’s action and to vote against the imposts.
– 1 was simply making the position clear.
– Do not make a nuisance of yourself. You would not know one end of a beetle from another or one weed from another. The honorable member for Wakefield is not the only primary producer who must bear the burden of additional costs imposed by tariffs on weedicides and insecticides. I, too, have an annual bill for those products, but I am not unmindful of the fact that Monsanto, I.C.I, and other industrial concerns have establishments in my electorate. I am not unaware that the employees of those organizations residing within the industrial area that I represent provide a certain market for the primary products that I produce. If those industrial concerns exploit me and make excess profits, the Government has ample power to draw off those excess profits by taxes.
This Parliament, if it has not already the power to deal with restrictive trade practices which may be engaged in by a combination between Monsanto Chemicals (Australia) Limited and Imperial Chemical Industries of Australia and New Zealand Limited and any other manufacturer, should have the power to determine whether such manufacturers shall continue to charge excessive prices for their products. The way to attack these problems is by exercis ing such powers, not by adopting the method suggested by the honorable member for Wakefield, which, in effect, would deprive these manufacturers of the protection that enables them to produce the products that we require. The solution proposed by the honorable member and by some of his colleagues is haywire and phony. Let us get to the root of the problem and attack it in the right way.
If the honorable member for Mallee (Mr. Turnbull), who is now interjecting, wants to barge into this argument, let me - by way of passing reference only, Mr. Chairman - say that always, on Tariff Proposals and other propositions which are discussed in this Parliament, the honorable member tries to protect himself by arguing that some years ago the Australian Labour Party opposed the ratification of the Japanese Trade Agreement. He says that if it were not for that agreement, which was entered into by the Government that he now supports, we would not be able to sell our wool to Japan. What damned nonsense! The honorable member ought to know that Japan has markets all over South-East Asia, Africa and the Mediterranean countries for the Japanese manufactures of Australian wool and, by virtue of earnings of sterling and dollar currency, has the wherewithal to pay us for our wool.
– The honorable member is a humbug.
– It is nonsensical for the honorable member to argue that the present prosperity of the primary producers of this country is a direct outcome of the Japanese Trade Agreement. His argument is phony and the greatest hooey that I have ever heard. The plain fact is that for more than a century this country has traded with France, selling sheepskins and wool to that country, and buying in return luxury goods. We have had an adverse balance of trade with France for more than 100 years.
Order! The honorable member has gone beyond a passing reference.
– I think you are right, Mr. Chairman. The Japanese Trade Agreement is an obsession with the honorable member for Mallee and he never misses an opportunity, in the discussion of Tariff Proposals or any other measures, to attribute
Australia’s profitable trade with Japan to the signing of the Japanese Trade Agreement in, I think, 1957, despite the opposition of Australian Labour Party representatives in this Parliament. Greater nonsense has never been talked. If the honorable member thinks-
– Order! I remind the honorable member that he should return to the subject before the committee.
– I return, Mr. Chairman, to the subject of duties on weedicides and insecticides. Australia is fortunate that we have industrial concerns which can manufacture these essential products. 1 emphasize again that, if the manufacturers do the wrong thing, a responsible government has the capacity to deal with them appropriately. The Australian Labour Party is not prepared to destroy the capacity of any Australian undertaking to manufacture these products, but is prepared to police the activities of the manufacturers and see that they do the right thing by the community. I leave the matter there.
.- Mr. Chairman, the honorable member for Lalor (Mr. Pollard) said, in effect, that the Japanese Trade Agreement was not worth a cracker. Under the terms of that agreement, the Japanese gave us specific guarantees that certain amounts of foreign exchange would be made available for the purchase of Australian goods by Japan. Full allowance was made for the foreign currency required by Japanese importers for the purchase of our wool. If these sums of foreign currency had not been made available, we would not have been able to sell to Japan the amount of wool that we are now selling to that country.
I turn now to the proposals relating to duty on weedicides and insecticides. If Australia’s agricultural industries are to progress, they must use the most scientific methods available. We have to adopt whatever new insecticides, weedicides and other chemical compounds are available. Only by using the benefits of advanced technology shall we be able to compete with other food-producing countries with lower living standards and, at the same time, maintain the highest standard of living in the world. If we are to use the new insecti cides, weedicides and other aids in agricultural production, we must try at all times to prevent putting any impediment in the way of the producer by burdening him with additional costs. We must at all times refrain from increasing the producer’s burden of costs by imposing additional duties on items such as insecticides and weedicides, particularly the compounds which are commonly known as 2,4-D and 2,4,5-T, and also “ Phenovis “, which we have heard discussed this evening.
The alternative to imposing an additional burden of cost on the producer, I think, is the proposal made by the honorable member for Barker (Mr. Forbes), who suggested that instead of imposing duty on these insecticides and weedicides the Government consider paying a bounty. When a tariff is imposed, who pays? The producer has to pay. When a bounty is paid, the whole of the Australian community pays the cost, for it is met out of the national revenue. No section of the Australian community is so hard hit to-day as is the primary producer. Therefore, every possible effort should be made by all of us to help him. I think that the ideal method is to pay a bounty instead of increasing duties. We already pay a bounty on the manufacture of tractors and of sulphate of ammonia, for instance. If a bounty is paid on the manufacture of chemicals such as 2,4-D and 2,4,5-T, any similar product, whether made locally or imported, is available to the Australian primary producer at a reasonable price. He is not loaded with the burden of an additional duty imposed just to protect an Australian enterprise producing 2,4-D and its esters and salts.
I say that we should look at these problems consistently and pay a bounty on the manufacture of these products. That is the way to help the Australian agricultural producer, who needs so much help in the world of to-day.
.- Mr. Chairman, I think that, in this matter of weedicides and insecticides, there is a rather special case, contrary to the argument advanced by the honorable member for Wakefield (Mr. Kelly), for affording protection to the Australian manufacturers of these products. Australia, due to its physical nature and its geographical extent, has a comparatively high proportion of primary industry, and this will be the situation for many years to come. Accordingly, we should enable efficient manufacturing concerns to be built up for the production of insecticides and weedicides. My reading of the report on this subject made by the Tariff Board suggests that Australia’s basechemicals industry is on the way to becoming efficient in the production of these chemicals. The demand for them is increasing all the time and I see no reason why we cannot build up an efficient locallybased industry in this field of manufacture.
We have heard all the classical arguments suggesting that we ought to protect Australian manufacturing industry. It is true that at this stage in our history we need to diversify our industry and thereby provide greater opportunities for employment. As other honorable members have stated, there is opportunity to discuss the different kinds of protection which might be given. I have some qualms about affording protection by raising tariffs. Bounties have been suggested as an alternative. At least bounties have the virtue of spreading the cost burden. It is not borne only by the primary producers. I suggest another alternative - quantitative restrictions. 1 notice that the first application by local manufacturers was for quantitative restrictions.
My first argument in relation to tariffs is that they increase costs. There is no doubt about that. The other argument is that, having increased costs, there is no guarantee that they will afford protection to the local manufacturing industry. If tariffs were increased to whatever levels we prescribed, there still would be no guarantee, especially when there was a state of over-supply in world markets, that goods from overseas would not enter this country. In my view, if we want to afford protection the much more efficient and decisive way to do this would be to establish import quotas. If we do not want any foreign goods to enter the country, we should say so. If we want a certain percentage of foreign goods to enter the country, we should say so. By imposing tariffs we increase costs without giving any certainty of protection to local manufacturing industry, whereas with import quotas or some form of import control local industry has some certainty about the competition it will have to endure from foreign-produced goods. Tariff protection does not help an industry to make a decisive judgment about the kind of competition it will have to meet, so it does not go into production to supply the local market with wholehearted confidence. We should consider some form of protection other than the patchwork arrangement represented by the temporary and variable tariffs recommended by the Special Advisory Authority.
I return to my point that Australia, by virtue of its size and its relationship to the other land masses of the world, will continue for many years to rely very heavily on primary industry. Being so reliant on primary industry, there will be not only a sizeable but also, I suggest, a constantly increasing market for weedicides and insecticides to protect our primary industries.
The classical argument in favour of any kind of protection is that not only will it provide employment and not only will it diversify our productive effort and our economy, but also it will help to conserve our overseas balances. This industry could well make a contribution in that regard. I am in favour of protection but I am not sure that temporary variable tariffs are the best way of affording it.
– The point made by the honorable member for Barker (Mr. Forbes), which was supported by the honorable member for Richmond (Mr. Anthony), should receive more attention from the committee. They suggested that a bounty might be a more acceptable way, in the long term, of doing something in relation to this problem. In the short term, I am certain that the Government has taken the correct action, although over the long term a bounty may be the more appropriate way of affording protection. When the balance of payments position settles down a little more it may be possible to give these individual items closer scrutiny. The honorable member for Wakefield (Mr. Kelly) shares my view on this. This is not the time to take finicking little points, but I suggest to the Government that we need better machinery to deal with these matters.
The honorable member for Wakefield has shown a great zeal and mastery of detail, but even he has not access to the full facts. Some time ago the honorable member for Barker suggested to the Government a select committee should be set up to look into these matters. Unfortunately, this proposal was not acceptable to the Government. When matters of this character are coming before the Parliament, I suggest tha! an officer of the department be made available to honorable members of both sides of the chamber so that they may ask him questions and receive appropriate answers on questions of fact. 1 would not expect such an officer to express opinions on policy, but honorable members are entitled to the truth when questions of fact arise.
.- I join in the criticism by the honorable member for Lalor (Mr. Pollard) of the attitude of the honorable member for Wakefield (Mr. Kelly) on these matters. The Parliament should not overlook the fact that although the honorable member for Wakefield criticizes the Government’s policy of protection, that criticism is never backed up by his vote. If he sincerely wants to substantiate the charges he has made in relation to the increase in his own costs of production, he should vote against the Government when the opportunity offers. Only one vote is needed to turn out the Government which, according to the honorable member for Wakefield and others, is not fit to govern this country.
He complained that the proposed protection would increase his own costs by £100 or £150 a year, and he stated that this would apply to all primary producers. He then said that this was unjust and an imposition on the primary producers. He will take all the protection which membership of the Liberal Party gives him in this place and in his electorate but, after criticizing the proposal, will not have the courage to vote against it. I am sick of being kept up half the night by his sham fight. As knowledgeable as he is on these matters, he is only a sham fighter. If he criticizes these proposals and wants to oppose them, he should join the Opposition when the opportunity offers and vote against the Government which, he states, imposes these burdens on the primary producers he is supposed to represent.
Even his own colleagues differ from him. I do not think he is a hero. If his electors are being treated unjustly, he should vote according to his feelings, not according to what he thinks will help him in the Parliament. I hope that he will not keep us here for the rest of the night by putting up this sham fight and making himself a hero in this place, but not giving effect, by his vote, to what he feels will help thousands of others who, he says, will be compelled to bear an additional burden of £100 or £150 a year. A few other members of the Liberal and Country Parties should do the same thing.
The honorable member for Richmond (Mr. Anthony) advocated a bounty instead of a tariff for the very good reason that he wants to make the people in my constituency contribute to higher profits for the primary producers he misrepresents in this Parliament. Why should my electors and others be called upon to pay a bounty so that the wealthy interests which support him will make more money at the expense of the consumers? Members of the Country Party want flood relief for six months and drought relief for the next six months. In addition, they want the people to pay bounties to the primary producers. They want socialism when things are bad and capitalism when things are good. They cannot have it both ways. The fact of the matter is that industries are entitled to protection. The industry under consideration is giving benefits to the primary producers and, therefore, is entitled to protection. I have heard criticism by members of the Australian Country Party in discussions on the issue of the Japanese Trade Agreement. The honorable member for Mcpherson (Mr. Barnes) said that we were at war with Russia yet to-day he is sponsoring the sale of Australian wool to that country. He does not care what happens as long as the people whom he represents get a greater return.
– Order! I suggest that the honorable member come back to the matter before the committee.
– Very well, Mr. Chairman. I was just making a passing reference to the passing references of members of the Country Party and other members opposite.
I agree that this industry and others are entitled to protection and I say that the Government is denying protection to industries, particularly to those which have a beneficial effect on primary industry as this one has. This policy nearly cost the Government the last general election. It will not be able to repeat that performance too often. These measures have been introduced only because the Government became frightened of the Australian electors. The Government put countless thousands of Australian people out of work because of its failure to protect industries such as this. These tariff proposals have been introduced, not because any member of the Government believes in them, but because the Government is fearful of the political consequences. This is a death-bed repentance in a roundabout way on the part of the Government to save itself. I have no desire to delay these proceedings, but I cannot sit idly by and see a member, who is as silent as the grave in the caucus room, indict his Government in this chamber while refusing to vote with the Opposition when the opportunity offers.
The honorable member for Wakefield will prove his sincerity as well as his knowledge of tariff matters if he votes as he talks, but until he does that his electors and the people are entitled to say that he is a sham fighter. This remark is also applicable to members of the Country Party. They do not believe in protection. They want people to work on farms. They do not want industries in the cities or in country districts. The Country Party is just a party of exporters which does not care what happens to any industry. With some members of the Liberal Party they are bringing these matters up in a half-hearted way. They are not prepared to give effect to a proper policy of protection. They refuse to give protection to industries that employ many thousands of Australians.
The honorable member for Wakefield claimed that the effect of the duty now under consideration would be to increase his costs by between £100 and £130 per annum. Is that much to deduct from the profits that these people are making in primary industry? I represent a consuming constituency. It is a great manufacturing constituency. I believe that my constituents are entitled to protection. The fact that some people have to pay a little more is the price we pay for employment for Australians in preference to Japanese and other people in cheap labour countries. The present conditions in industry exist because the Labour Government was prepared to protect Australian industries in the 1930’s. Members of the Government parties have sought to destroy that protection. They are now condemned for it by the Australian people. The sham fight put up by the honorable member for Wakefield and others does not excuse them from meeting their responsibility to protect Australian industry and the jobs of Australian workers.
.- It is very easy to understand the honorable member for Grayndler (Mr. Daly). He does not understand that honorable members on this side of the chamber can criticize Government proposals without being expelled from their party. The honorable member for Grayndler knows that if a member on his side of the chamber criticized certain Opposition proposals as members on this side have criticized Government proposals to-night they would not be endorsed as Labour candidates at the next general election. The previous honorable members for Adelaide and Kalgoorlie lost their endorsements in that way.
I must compliment the honorable member for Barker (Mr. Forbes). I think he made an excellent speech. He made special and accurate reference to the electorate that I represent. I appreciated that. He asked how the wheat-grower in the Mallee reacted to the increased cost of weedicides. He spoke about the subject of skeleton weed which I have brought forward in this chamber very often. The farmer in the Mallee country does not feel very happy about increased costs. In relation to the subject of bounties, I suggest that the increased cost of weedicides should be included in the articles that are considered in estimating the cost of production of wheat. The cost of production of wheat is estimated in accordance with a formula.
– What about the woolgrower?
– I referred to the wheat-growers for the simple reason-
– Order! I suggest that the committee come to order and we may then get through these proposals more quickly.
– I referred to the wheat-grower specifically simply because the honorable member for Barker referred to them. In answering him, I did not include the wool-grower and others because his remark related specifically to the wheatgrower. I think that the increased cost of weedicide should be included in the costofproduction formula and then a bounty would not be needed.
I must agree with the honorable member for Wakefield (Mr. Kelly) that farmers are sick and tired of people saying, at shows and on other occasions, “ You must cut your costs down.” Everywhere in the country costs are high and farmers have to buy in high cost markets. The honorable member for Lalor (Mr. Pollard) said, “ I am in favour of the protection of the big manufacturing industries.” He said, “ Three of them are in my electorate and a lot of men are employed in them. The excessive prices charged by these industries could be partly recovered by taxation.” That is the best idea of self-preservation I have heard put forward in this chamber. Selfpreservation is still the first law of the universe and the honorable’ member for Lalor has applied it to-night. It is in Sunshine and other places in his electorate that these industries are established. If he can keep those industries going, perhaps with high tariffs, and their employees voting for him and skim off their excess profits by taxation, that would suit him.
The honorable member for Grayndler asked why members of the Country Party did not vote with the Opposition and show their courage on these issues. Is the Opposition opposed to this measure? Of course it is not. What ridiculous rot! What is he talking about? If the honorable member for Wakefield were to vote against this proposal the Labour Opposition would support him in order to try to embarrass the Government. But under normal conditions Labour will support this measure because it is a high protection party. All these things have been taken into consideration and the speeches of some Opposition members, therefore, do not make much sense. In conclusion, I say that we need to keep the prices of primary products up and if we do that the whole of Australia will benefit.
.- The honorable member for Mallee (Mr. Turnbull), as usual, indulged in a substantial amount of criticism of members of the Australian Labour Party. He is critical of these tariff proposals but always and ever, like a slave, he votes for such proposals although he rants against their imposition. That is all I have to say.
Question resolved in the affirmative.
Motion (by Mr. Fairhall) proposed -
That the House do now adjourn.
.- A few weeks ago I posed a question to the Treasurer (Mr. Harold Holt) in relation to taxation zone allowances. In his reply the Treasurer said that the whole matter of zone allowances would have to be reviewed. Therefore, I take this opportunity to-night of placing before the House for the consideration of honorable members my views on and suggestions in regard to zone areas.
Section 79a of the Income Tax and Social Services Contribution Assessment Act provides for the granting of concessions to people living in certain areas in Australia and its territories wherein certain disabilities, disadvantages or circumstances apply. The areas are divided into two zones, A and B, and these zones are set out in the first and second schedules to the Income Tax Act. The disabilities or circumstances that have to be considered in determining the zone areas are uncongenial climatic conditions, isolation and high cost of living in zone A, and to a lesser extent in zone B. One or other of these two zones exist in every State of Australia, with the exception of Victoria, but to-night I wish to deal with the position in Western Australia. As the present zone boundaries are drawn the true purposes of section 79a are not properly being carried out. Section 79a (1) says -
For the purpose of granting to residents of the prescribed area an income tax concession in recognition of the disadvantages to which they are subject because of the uncongenial climatic conditions, isolation and high cost of living in Zone A and, to a lesser extent, in Zone B, in comparison with parts of Australia not included in the prescribed area . . .
To comply with that section we must therefore recognize the disadvantages to which people in a prescribed area are subject, as compared to the conditions for people living outside the prescribed area, and the disadvantages we must look for to establish the prescribed area are those uncongenial climatic conditions, isolation and the high cost of living.
There is no doubt in my mind, and no doubt in the minds of a large number of people in Western Australia, that in that State the present area outside the zones extends too far into areas where the lesser disadvantages of zone B are quite apparent and, also, that zone B extends too far into the area where the greater disadvantages of zone A really apply. Or, to put it more simply, the present southern boundary of zone A should be still further south, and the southern and western boundaries of the existing zone B should be still further south and west. I suggest to the Treasurer that it would be more in keeping with the intention of section 79a if he altered the boundary for zone A by commencing at the west coast at latitude 27°, continuing to longitude 117°, proceeding thence to the junction of 117° longitude and 28° latitude, thence in a direct line to the junction of latitude 30° and longitude 121°, thence to the junction of latitude 30° and longitude 123°, and from there taking a direct line to the south coast.
I suggest that zone B should be altered to take in all that area between zone A and a boundary commencing on the west coast at latitude 29°, proceeding east to longitude 116° from there following a direct line to that part of the existing boundary situated approximately half-way between Lake King and the rabbit-proof fence, and then along the existing boundary to the south coast.
I appreciate that no matter where the zone boundaries are drawn there will be some taxpayers who are just slightly outside the prescribed areas and some just inside those areas, but I suggest that because of that inevitability it would be better for the schedules to regard areas which may be on the border line as warranting inclusion, rather than to exclude areas which really do warrant inclusion. In other words, I suggest that in a matter such as this it is much better to be a little more generous than to be extremely mean.
For instance, if climatic conditions, isolation and cost of living are properly considered, it would mean that the towns of Wiluna, Sandstone, Laverton, Agnew, Cue and Meekatharra and several other gold-field and pastoral areas and places along the trans-continental line should be moved into zone A rather than be part of zone B. Incidentally, I should like to draw the attention of the House to the fact that when these zone concessions were placed in the act the towns of Wiluna, Sandstone and Laverton had a railway service, but for the last few years there has been no railway service and the people in those places are relying on one plane service a fortnight. So it is easily seen that the isolation qualification certainly applies, and if anybody goes into those areas he will certainly agree with me that the climatic conditions are very uncongenial and that the cost of living is extremely high.
The same position applies, but to a lesser extent, as provided by section 79a, in regard to areas which should be included in zone B but are now left in the noconcession area. The whole district of Geraldton, for instance, is excluded from zone B, although Geraldton is accepted as being a very high cost town. Also, it is locally accepted that it has many disadvantages compared with the metropolitan area and other areas farther south. Even though Geraldton is excluded from zone B we find a peculiar position arising because part of an adjoining district - the Upper Chapman district - which is very close to the town of Geraldton and very close to the south coast is included in zone B, whereas parts of the Geraldton district, ten times farther east and several times farther north, are excluded from that zone.
That state of affairs is due largely to the fact that the present boundaries follow the boundaries of several road board or shire council districts, and these boundaries do not go in a straight line from, say, the south-west corner of the district to the north-west, but wave about all over the place. That is the reason for the anomalous position now applying.
– How long is it since the boundaries were altered?
– They were last altered in 1945. Referring to Western Australia, the second schedule - the zone B schedule - states -
I will not read any more of that, but it is easy to see that it would be very difficult for anybody to determine where zone boundaries run just by reading the schedule, or even by referring to an ordinary map of Australia. You must go to the road district maps, and those maps do not refer to towns, so you have a most difficult task. The Taxation Branch does not rely on maps. The taxation officers have a list of towns at which they look when a man puts in his taxation return. They check to see whether a particular town is inside or outside the zone. Looking at a map, one would have no idea of the position.
For these reasons I have suggested that the boundaries, rather than slavishly follow road district boundaries, should as closely as possible be related to parallels of latitude or meridians of longitude, as the case may be. I realize that that may not be completely possible, but I say that if it were done as nearly as possible it would make the position much clearer.
– Order! The honorable member’s time has expired.
Motion (by Sir Garfield Barwick) put -
That the question be now put.
The House divided. (Mr. Speaker - Hon. Sir John McLeay.)
Majority . . . . 4
Question so resolved in the affirmative.
Original question resolved in the affirmative.
House adjourned at 11.39 p.m.
The following answers to questions were circulated: -
m asked the Attorney-General, upon notice -
On how many occasions and to what tribunals have appeals been made in the last five years under the Copyright Act, Designs Act, Patents Act and Trade Marks Act?
– The answer to the honorable member’s question is as follows: -
The number of appeals from decisions of the Commissioner of Patents or Registrar of Trade Marks in the last five years is as follows: -
There were no appeals under the Designs Act.
The Copyright Act makes no provision for appeals from the Registrar of Copyrights.
Some appeals under the acts mentioned are between private parties and information as to the number of these is not presently available to me.
Other proceedings under the acts mentioned that are not appeals have not been included in the figures above.
n asked the Minister for Territories, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Attorney-General, upon notice -
– The answers to the honorable member’s questions are as follows: -
n asked the Minister for Trade, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister representing the Minister for National Development, upon notice -
– The Minister for National Development has supplied the following information: -
The Western Australia Grant (Northern Development) Act 1958-1959 provides for the payment of up to £5,000,000 as assistance towards the cost of approved developmental projects in that part of Western Australia lying to the north of the twentieth parallel of latitude, undertaken by the State during the five years commencing 1st July, 1958. In offering and administering the grant the Commonwealth has made it clear that prime responsibility for the development of the area continues to rest with the State. The selection, planning and execution of the projects assisted has been left to the State.
Under the act the Commonwealth has contributed to June, 1962, £2,600,000 towards the cost of the Ord River Diversion Dam and the Main Channel from that dam. It is estimated that a further £1,400,000 will be contributed by the Commonwealth in respect of the two projects in 1962- 63, completing the total grant of £5,000,000 available under the provisions of the act.
The other matters raised in the honorable member’s question relate to the technical details of the Ord River irrigation scheme proposal. This is a State matter. Some details of the proposal have been published by the State Department of Public Works but I suggest that the honorable member might approach the appropriate State authorities for whatever up-to-date information is available.
d asked the Minister for Territories, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for Exter nal Affairs, upon notice -
What are the names and classifications of diplomatic officers of his department who have left the diplomatic service during the last five years?
– The answer to the honorable member’s question is as follows: -
Miss G. F. Anderson, External Affairs Officer, Grade I (retired on marriage).
S. Currie, External Affairs Officer, Grade III.
St.A. Dexter, External Affairs Officer, Grade IV
W. Eckersley, External Affairs Officer, Grade IV
R. Heydon, External Affairs Officer, Grade VII.
J. A. Hudson, External Affairs Officer, Grade I (deceased).
V. Kellway, Minister (retired).
H. Marshall, External Affairs Officer, Grade III (retired).
V. Matthews, External Affairs Officer, Grade I.
L. Mulrooney, External Affairs Officer, Grade 111 (retired).
Miss C. Nelson, External Affairs Officer, Grade IV (retired on marriage).
E. Osborne, External Affairs Officer, Grade II.
A. Pyman, External Affairs Officer, Grade III.
P. Quinn, Ambassador (deceased).
J. L. Ride, External Affairs Officer, Grade 1.
K. T. Smith, External Affairs Officer, Grade I.
Miss R. P. Thompson, External Affairs Officer, Grade II. Sir Alan Watt, Ambassador (retired).
A. Whitehead, External Affairs Officer, Grade I.
Miss P. A. Williams External Affairs Officer, Grade II (retired on marriage).
A. Wynes, Legal Adviser.
d asked the Minister for External Affairs, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for External Affairs, upon notice -
– The answers to the honorable member’s questions are as follows: -
d asked the Minister for External Affairs, upon notice -
– The answers to the honorable member’s questions are as follows: -
Nuclear Tests by France.
m asked the Minister for External Affairs, upon notice -
– The answers to the honorable member’s questions are as follows; - 1 and 2. No. Press reports that France is planning to use Mangareva Island as a nuclear weapons testing site have not been officially confirmed.
Rates on Commonwealth Property.
son asked the Minister for the Interior, upon notice -
What local government rates were (a) levied and (b) paid in ex gratia form in respect of Commonwealth-owned property in each State during each of the last five years?
– The answer to the honorable member’s question is as follows: -
n asked the Minister for the Interior, upon notice -
– The answers to the honorable member’s questions are as follows: -
m asked the Minister for Immigration, upon notice -
How many persons in each nationality (a) have been naturalized, (b) are eligible for naturalization but have not applied for it, (c) have had their applications for naturalization refused or deferred for security reasons and (d) have had their applications refused or deferred for any other reason?
– The figures requested by the honorable member are as follows: -
Of the estimated number of approximately 240,000 eligible aliens who had not applied for naturalization up to 31st December, 1961, approximately 48,000 would be children under sixteen years of age who, as a rule, could not apply for naturalization in their own right, but would be included in the applications of their parents.
Of the total of 251 applicants who have had their applications refused or deferred for security reasons, 51 were subsequently approved upon review.
The total of 11,329 applicants whose applications were refused for other reasons, includes those refused or deferred because of the applicants’ inability to satisfy the language requirements of the act. Many of these applicants would have subsequently been granted naturalization.
y asked the Minister for Immigration, upon notice -
– The answers to the honorable member’s questions are as follows: -
e asked the Minister for Immigration, upon notice -
How many migrants of each nationality, including children under sixteen years of age, (a) have been naturalized since the immigration programme commenced and( b) are eligible, but have not yet applied, for naturalization?
– The answer to the honorable member’s question is as follows: -
The number of migrants, including children under sixteen years of age, of each nationality (a) who have been naturalized and (b) who are eligible but have not applied for naturalization is: -
Of the estimated number of approximately 240,000 eligible aliens who have not applied for naturalization, approximately 48,000 would be children under sixteen years of age who, as a. rule, could not apply for naturalization in their own right, but would be included in the applications of their parents.
d asked the Minister for Immigration, upon notice -
– The answers to the honorable member’s questions are as follows: - 1 and 2. During the period 1950 to 30th June, 1962, the number of persons who have actually been deported from Australia was 2,951. The figures for each calendar year and the reasons for deportation are -
n asked the Minister for
Immigration, upon notice -
– The answers to the honorable member’s questions are as follows: -
y asked the Minister for Immigration, upon notice -
– The answers to the honorable member’s questions are as follows: -
y asked the Minister for Immigration, upon notice -
– The answers to the honorable member’s questions are as follows: -
Cite as: Australia, House of Representatives, Debates, 10 October 1962, viewed 22 October 2017, <http://historichansard.net/hofreps/1962/19621010_reps_24_hor36/>.