Senate
5 August 1930

12th Parliament · 1st Session

  1. Senate
  2. 12th Parliament
  3. 1930

The President (Senator the Hon. W. Kingsmill) took the chair at 11 a.m., and read prayers. .

page 5221

PAPERS

The following papers were presented -

Electoral Act - Regulations (Joint Electoral

Rolls)- Statutory Rules 1930, No. 82.

Post and Telegraph Act- Regnlations amended- Statutory Rules 1930, No. 81.

Invalid and Old-age Pensions Act - Stateinent re Pensions for the twelve months ended 30th June, 1930.

Public Service Act - Appointments - Department of. Health -C. J. Logan; H. B. Skinner.

New Guinea Act - Ordinance No. 15of 1930 - Testator’s Family Maintenance.

page 5221

QUESTION

JUTE GOODS

Senator E B JOHNSTON:
WESTERN AUSTRALIA

asked the Minister representing the Minister for Trade and Customs, upon notice -

  1. With reference to the application for a duty on corn sacks, wool packs and other jute goods which has been referred to the Tariff Board for report - will the Government instruct the Board to take evidence -on this application in Western Australia, for the convenience of the primary producers of that State!
  2. Ifnot, why not?
Senator BARNES:
Assistant Minister assisting the Minister for Works and Railways · VICTORIA · ALP

– The Minister is prepared to suggest to the Tariff Board that this is a case in which it is desirable that evidence should, if practicable, be taken in Western Australia.

page 5221

QUESTION

FEDERAL GOVERNMENT EMPLOYEES

Journalistic Activities

Senator RAE:
NEW SOUTH WALES

asked the Minister representing the Prime Minister, upon notice -

In regard to a question previously asked by SenatorRae concerning allegations that a number of public servants were performing journalistic work for Sydney newspapers - has the Minister made the promised inquiries, and if so, with what result?

Senator BARNES:
ALP

– As intimated in reply to the question asked by the honorable senator on the 4th July, inquiries were duly instituted in the matter. Those inquiries have now been completed, and show that, of the three persons mentioned, only one, viz., Mr. G. D. Hellmrich, is a Commonwealth officer. Staff Sergeant Major E, S. Lukeman, formerly of the Australian Instructional Corps, Department of Defence, was discharged at his own request on the 19th June, 1928, and Mr. Leo Percy is an officer of the Taxation Department of the State of New South Wales. “With regard to Mr. G. D. Hellmrich, who is an officer of the Postmaster-General’s Department, the Deputy Director, Posts and Telegraphs, Sydney, has reported that from investigations which have been made he is quite satisfied that Mr. Hellmrich does not engage in any remunerated employment outside his official duties. In a statement furnished to the deputy director, Mr. Hellmrich points out that he is assistant secretary to the New South Wales Amateur Swimmers’ Association, honorary chief coach to, and diving judge of, the association; and honorary treasurer of the New South Wales Water Polo Association, and that he is required by these associations to give pressmen any information they require about the associations, but that this carries no remuneration. I am advised by the Public Service Board that there are few cases in which it has granted permission, under section 91 of the Commonwealth

Public Service Act, to officers to contribute to the press for remuneration, and that when the permission is granted it is the practice to stipulate that the work is to be confined to occasional contributions, that it is not to be in pursuance of any regular engagement, that the contributions are to be purely of a literary or fictional nature and are to have no political character or relation to questions of public administration, and that the work is to be performed in the officer’s own time and is not to interfere with the discharge of his official duties.

page 5222

QUESTION

TASMANIAN HYDRO-ELECTRIC SCHEME

Remission of Duty

Senator BARNES:
ALP

– On the 29th May, Senator Ogden asked the Minister representing the Minister for Trade and Customs, the following questions, upon notice -

  1. What was the total amount of duty paid by the Tasmanian Government on material purchased abroad for the installation of the Great. Lake power scheme?
  2. What was the total amount of remissions of duty, if any, and were applications for remissions made?

I am now able to furnish the honorable senator with the following information -

This matter is now very old, and the department has no separate recordof the shipments imported by or for the Great. Lake power scheme. The Hydro-electric Department has supplied the following information -

page 5222

HOPS MARKETING BILL

Motion (by Senator Bashes) agreed to-

Thatleave be given to introduce a bill for an act relating to the marketing of hops and for other purposes.

Bill broughtup bySenator Barnes, andreadafirsttime.

page 5222

CONCILIATION AND ARBITRATION BILL

Reports adopted.

Third Reading

Motion (by Senator Bashes) proposed -

That the bill be now read a third time.

Senator LAWSON:
Victoria

– The bill as reported from committee represents a compromise, but I regard the giving of arbitral powers to conciliation commissioners as a fundamental error which will impede the satisfactory working of the arbitration machinery, and is not calculated to’ establish that peace in industry which is declared in the preamble to be one of the main purposes of the bill. I want to make my position perfectly clear in this matter. To constitute conciliation commissioners judges, with power to make final determinations, is contrary to the very spirit of conciliation. If the Government desires to promote conciliation - and I believe that the people gave it a mandate to introduce conciliatory methods into the settlement of disputes - then the bill it has brought forward to that end will not accomplish its purpose. It is to disregard that mandate to give to these commissioners arbitration Sowers.In his policy speech, the Prime Minister (Mr. Scullin) said that a Labour government would remove from arbitration . legislation its “ entangling legalisms’” and the’ litigious atmosphere that is always present when parties to a dispute keep each other at arm’s length, as’ antagonists rather than as partners in industry. By vesting arbitration powers in these commissioners we shall destroy the possibility of conciliatory methods being successful. I regard the proposal set out in this bill as a fundamental error. If the Senate is determined to substitute lay judges for legal judges - and that is the effect of the decision of honorable senators to agree to the compromise suggested by the VicePresident of the Executive Council (Senator Daly) in place of the Government’s original intention to establish commissioners with full arbitral authority - it will give to men whose qualifications are not. set out in the measure, judicial powers which ought to be entrusted only to men peculiarlyfitted to exercise those functions. I am not denying that it will be possible to find in the community men who, though not qualified to act as judges, will be fitted to act in the capacity of conciliation commissioners. Indeed, I know of many men who would be most influential in the settlement of industrial disputes without being given the power to make final decisions. I do not wish to delay the Senate by adopting a policy of obstruction, or by displaying obstinacy, but I feel strongly that this bill will not assist the cause which the Government declares its desire to promote - the attainment of peace and goodwill in industry. Bather will it be destructive of the very spirit of round-table conferences, negotiation and goodwill. This legislation will continue the present bad system by which parties to a dispute approach its consideration as opponents rather than as friends. The mandate of the people was for conciliation. Had this bill provided for conciliation, it might have assisted to promote goodwill in industry; but in the form in which it finally leaves this chamber it provides for arbitration, with all its attendant evils, in the guise of conciliation.

Senator RAE:
New South Wales

– I am not at all surprised at the outburst from Senator Lawson; but it seems rather peculiar that the finality which he attributed to the decisions of conciliation commissioners should be the point of attack on this bill. We on this side of the chamber are disappointed with the bill, because it continues in every important respect the right of appeal to the three judges of the court. To-day is the first time that I have heard of any compromise having been arrived at; I thought that the spirit of compromise was to operate in tie future. The supporters of the Government in this chamber are entirely opposed to the bill in the form in which it emerged from the committee stage. Although I do not think that arbitration in industrial matters will bring the millennium, the extent to which the bill in its original form might have assisted to do so has been nullified by the alterations made to the’ measure in committee. In my opinion, all talk about capital and labour being part ners in industry is only the repetition of a hypocritical slogan. It is a peculiar partnership which enables the senior partner to get rid of the junior partner whenever he feels inclined to do so.

Senator Sir George Pearce:

– The junior partner can do the same; he can just walk out.

SenatorRAE. - The position is not the same, for should the junior partner walk out - should the workman throw up his job - there are always plenty of others available to take his place. To the junior partner the most tragic; happening in his life may be his dismissal; it may mean that he will be unable to procure further employment, and consequently be reduced to destitution. For that reason” all talk of the two sides in industry being partners is, in my opinion, only hypocrisy and humbug. The only true partnership is where there is something approaching economic equality between the partners. Although I am dissatisfied with the way in which the bill has been mutilated in committee, and regard the measure as now of little or no value, I shall not delay its passage. Yet, if it were delayed until the crack of doom no one would be any worse off. But the Senate has for its consideration other business of greater importance. Unless drastic and fundamental alterations are made to the measure now before us, it will certainly not be appreciated by the vast majority of the people of this country - the workers who authorized the party of which I am a humble member to effect a complete alteration of the form of arbitration as it prevailed during the regime of the last Government. The Government’s efforts in that direction . have been practically nullified by the amendments made in this chamber; the bill in its present form is not worth two pence to anybody. Should it be placed on the statute-book in its present form it will be a grievous disappointment to many. It can only excite the resentment of the great majority of the workers of the country, who, unfortunately for themselves, imagine that arbitration measures will solve their problems. I believe that a sound system of arbitration could do much to ease the inevitable conflict between the forces of capital on the one hand and organized labour on the other; but it could not obliterate the differences which exist. I welcomed the introduction of the bill because I believed that it might do something to bring about, by orderly methods, changes which are desirable. But in its present form it merely offers’ stones for bread. It will be so utterly disappointing to those who looked forward to improved industrial legislation, that I predict that it will be rejected with contumely and contempt at the first opportunity that the electors get to express their opinion about it.

Question resolved in the affirmative.

Bill read a third time.

page 5224

SEWING MACHINE BOUNTY BILL

Secondreading.

Debate resumed from 1st August (vide page 5126) on motion by Senator Barnes -

That the bill be now read a second time.

Senator McLACHLAN:
tralia · South Aus

– This extraordinary bill, which is another of the parish pump provisions for bounties which have been brought forward during the present sitting of Parliament, has had a strange effect on the minds of honorable senators. Discussing it, the Leader of the Opposition (Senator Pearce) burst into verse. His example was followed later by the Government Whip (Senator Dunn). I can only conclude that they were moved to verse by reason of the fact that, perhaps, the best known sewing machine in Australia is called the “ Singer “. The efforts of those* honorable senators have not commended themselves to the Senate, nor, indeed, have they assisted the passage of the bill.

Since the present Government came into office we have had several examples of patch-work bounty bills being brought before the Senate. First, we had a measure for the granting of a bounty on cotton. I voted against that bill because the country can ill afford to pay a bounty on cotton. A little later we had for our consideration, a measure to provide for a Commonwealth guarantee of £300,000 in relation to the Wiluna gold mine. Then we were beguiled into agreeing to a bounty on flax and linseed. I trust, however, that the Senate will be too keenly alive to its duty to pass a measure providing for a bounty on the production of sewing machine heads. The patch-work nature of these bounty proposals is suggestive of Joseph’s coat of many colours. The granting of bounties will give no relief from our present economic difficulties. The Minister, whose eloquencecharacterizes every speech that bt’ makes in connexion with bounties, has evidently again been inspired by Edgar Wallace. He can weave around the most prosaic thing, such as a sewing machine, a story which is apt to fascinate honorable senators, and rob them of their judgment, unless they refuse to be lulled or doped into a false sense of security by accepting the honorable gentleman’s statements at their face value.I cannot see how the country will benefit by the passing of this measure. The only thing connected with it which appears tolerably certain is that the Government will make a fair profit this year if the bill becomes law. There is already a duty of 10s. on each sewing machine- head imported from Britain, and a duty of£1 on other imported machines. The bounty proposed is £2 for each machine made in Australia. In a normal year Australia imports 45,000 sewing machines. Assuming that for the current financial year the number of machines imported will be only 40,000, and that each will pay the average duty of 13s.. the revenue from that source will be about £26,000. That amount will be taken out of the pockets of those who purchase sewing machines during the present year. What does the Government propose to spend in this connexion? An examination of the Estimates shows an estimated expenditure of £6,000. It will therefore be seen that in this measure a subtle Treasurer is providing means whereby the Treasury will benefit Po the extent of about £20,000.

SenatorRae. - Would it not get that amount in any case?

Senator McLACHLAN:

– It may. The Government clearly contemplates that the output of machines during the present year will be not more than 3,000. On production a bounty of £2 a machine is to be paid.

Something has been said with regard to the existence of a monopoly in this industry; but I have always understood that the application of the monopolistic principle was to one class of article. A dozen or more different makes of sewing machines are being imported into Australia and sold to our people. The observations of Senator Massy Greene and Senator Crawford were perhaps directed to the prices charged, for imported machines; but the number of sewing machine vendors operating in Australia is sufficient to insure that the public will not bc exploited in regard to price. Any exploitation that arises must be due to the application of the time payment system to this industry. Distribution cost, as some honorable senators have pointed nut, is a big ‘factor in increasing the price of sewing machines, as it is, in fact, in increasing the price of numerous other articles vended in Australia. But for the life of me, I cannot see Low the establishment of the sewing machine industry in Bendigo can be of any benefit to say, the residents of Perth, having regard to the fact that it would cost more to send sewing machines from Bendigo to Perth than it costs to bring them from Tilbury Docks to Perth. Many instances have been quoted on different occasions to show how our transport charges by land and sea are crippling Australian industries. These high costs force the people of Australia to pay much more for the articles which they buy than would otherwise bo necessary, and therefore inflict a serious burden upon them. I know of no exploitation which occurs in the sewing machine industry, except that which arises in the manner indicated by Senator Bae. If our people are improvident enough or necessity forces them to deal in the way the honorable senator suggested, it is indeed a misfortune. But, as sewing machines are imported in large numbers from Germany, the United States of America, and the United Kingdom, and a small number are made locally, I cannot believe that there is a ring in existence in this industry which practically controls prices.

An instructive letter appeared in the Sydney Morning Herald on Friday last on this subject, signed by G. A. Tranter, who was doubtless moved to write because of the statements of the Minister, inspired by his natural ally, Edgar Wallace. The letter read : -

One can hardly accuse Senator Barnes of deliberate misrepresentation in so persistently mentioning “(.lie cost of imported machines” as £19 4s., but it .is really difficult to imagine how, after the most casual investigations, he could believe that this is anything like the average cost of the imported machine to the public. One well known foreign firm- sells at this price because it follows the policy of canvassing, at the same ti hil- accepting timepayment conditions.

Practically all of Sydney’s loading department stores sell various makes of imported treadle, drophead sewing machines at from £10 to £13 10s., thoroughly guaranteed. These machines are sent all over the world in enormous numbers, and are made to a standard <if accuracy impossible of attainment without the special machinery which such a large output permits.

Probably every sewing machine man in Australia has, at one time or another, gone into the question of local manufacture, and every one .1 know, except the optimists who wish t” sink ibo public’s money at Bendigo, is agreed that no probable public demand for a locallymade machine would pay for the plant required. This is no time tn commence or. rather, to continue spoon-feeding such schemes as this. Then: are plenty of outlets for our money in helping those engaged in producing what we know will sell, namely, our primary products. When there is Government money not required for more urgent purposes, if ever, that would be quite time enough to experiment in new industries. Furthermore, if the local machine is to sell for £15 15s., and the cost of the imported machine is £10 in., “why,” as Senator Pearce asks, “the bounty!”

That .pertinent letter concludes with a pertinent inquiry. But I believe that this bill will meet at the .hands of the Senate the fate that it richly deserves, and as it is not of much use to attack the already slain, I shall not say very much more about it.

I regret the absence of certain senators this morning, because 1 desire to reply to a few remarks made by them in regard to the exploitation of our people by the charging of high prices for sewing machines. Having regard to the fact that these honorable senators are supporting other schemes which are inflicting far greater hardships on our people than are being inflicted upon them in connexion with this industry it ill becomes them to attack this industry. There are certain uneconomic measures which these honorable gentlemen support, “which place a very heavy burden upon our people.

It appears to me that no case whatever has been made out for the granting of this bounty. I agree with Senator Rae that the home market is the best that our producers and manufacturers can have, if it’ can be obtained without flogging the people who live inside the protective fence. When it is necessary to inflict severe hardships on our people to retain this market it is better for us to let it go: I speak as a protectionist of a lifetime; I have always endeavoured to exercise my vote on sound protective principles. Australia has mapped out her protectionist plans along the lines followed by the United States of America, but without having regard to two important considerations, namely, largeness of population and cheapness of transport. These two considerations are vital, in. my opinion, to the application of the protective policy on a large scale, unless the people within the protective fence are to be flogged. When it costs as much to send a motor car from Sydney to Melbourne as to bring it from Vancouver to Sydney, one ought to pause to consider where this policy is leading us, and whether greater hardships may not be inflicted upon our people in the endeavour to secure for them the home market. If that home market can only be secured for certain manufactured goods by the charging of very high prices for them it is not worth our while seeking to retain it in respect of them. The home market is the most valuable one that we can have-, provided that our population is sufficiently large and our transport charges low enough to render unnecessary the charging of unreasonably high prices for our goods. It must be remembered that whether 1,000 or 3,000 articles of a particular kind are turned out, the overbead costs are practically the same. We have a population of only about six and a half millions, scattered over a vast continent, and we have large tracts of country where there is no market whatever foT our goods: This means that our manufacturers, who in many cases turn out excellent goods, are obliged to charge very high prices - in my opinion far too high - for their products to the people in distant parts of Australia. Because of the factors to which I have referred neither the Government nor the officers of the Customs Department can make any just complaint of the prevailing high prices for Australian manufactured goods; but unfortunately these prices are having the effect of strangling some of our primary industries. In such circum stances the home market is not of much use to us.

I do not think that this bill has the slightest chance of receiving the endorsement of the Senate. It is fundamentally unsound. The introduction of such measures is unfair to our own people, from whom we are demanding the payment of increased taxation, and to the people overseas, from whom we shall soon be seeking more money to carry on our public works. In fact the introduction of such measures as this makes us look ludicrous in the eyes of the economists and financiers overseas. The bill is unworthy of the Government, and I join with Senator Carroll in inviting the Minister to withdraw it. It is ridiculous to suppose that we can build up a substantial industry in the manufacture of sewing machine’ heads in this country. I fear that if. this bounty is agreed to, the nation will be obliged to continue paying it for very many years, if not for all time. If the Minister does not withdraw the bill, I shall vote against the second readingof it, mainly because, as I said when the last bill of this nature was before the Senate, this is not the time for us to be spending money in this way.

SenatorRae. - What about the report of the Tariff Board? .

Senator McLACHLAN:

– The. report of the board is not being given effect in. this case, but in any event we should not be expected; to swallow every report that the board makes. If the. Government would accept the recommendations of the Tariff Board in every instance it would not be so bad ; but it did not please to do so in connexion with the timber industry. The board made a certain report in this connexion, and in a few weeks’ time the Government formulated a policy which was entirely different from that recommended by the board. We are not the creatures, but the masters, of the Tariff Board. If a few very active-minded gentlemen formulate schemes for the buttressing and supporting of certain industries which are fundamentally unsound, we should have sufficient common sense, as the guardians of the nation’s welfare, to reject them. The action of the Government will impose a burden on the users of sewing machines and a still greater burden upon the taxpayers of the community, with whom E am particularly concerned at the moment. Australia has a very difficult position ahead of it, and the granting of bounties on sewing machines and helping other stupid little industries is a ridiculous futility. The Government should aim at something big, that will afford national relief; something about which it is worth while taking a risk. This project is unworthy of the Government.

Senator CHAPMAN:
South Australia

– Senator McLachlan has lucidly outlined the difficult position in which the Government finds itself, and the uselessness of submitting a proposal such as that embodied in the bill.” He has stated that during the first year that the sewing machine industry will operate in Australia the Treasury will benefit to the extent of about £20,000. That is mere conjecture. The Government claims that the duty will pay the bounty - a very convenient way of looking at the matter from its point of view. We must, however, have regard to the position of the taxpayers of the country. It is proposed to impose a burden Upon the users of sewing machines, the thrifty housewives of Australia, who work far more than eight hours a day on their household duties, and probably put in an additional three hours daily at the sewing machine, making clothes for themselves and their families, and perhaps endeavouring to supplement the family income by taking in sewing. The housewives will pay the duty, and the general public of Australia is expected to pay the bounty. What an ingenious scheme! The Minister quoted certain figures as to the cost of sewing machines, but they were very definitely refuted by the newspaper article read to the Senate by Senator’ McLachlan this morning. Which figures are we to believe ?

Honorable senators on this side are asked why they do not accept the recommendation of the Tariff Board. The Government certainly has not done so. I point out that the report of the Tariff Board on sewing machines was submitted on the 19th December, 1925, at a time when the national exchequer and the country generally were prosperous, when economic difficulties did not loom on the horizon. Our complete reversal of fortune justifies the Tariff Board in reviewing its previous recommendation. It is significant that that out-of-date report of the board was not ordered to be printed until the 15th July, 1930. That ancient record is the justification that the Government has for introducing the bill. In the light of recent events, we are surely entitled to an up-to-date pronouncement upon the possibilities of the sewing machine industry in Australia.

The Senate is asked to agree to the payment of a bounty of £2 on each sewing machine head manufactured in this country, and an increased duty is to be imposed on all imported machine heads. As the tariff schedule is closely associated with this bounty proposal pf the’ Government I shall quote the old and new duties on sewing machine heads; as it is necessary to ascertain the final cost of sewing machines to the public. The old range of duties was: -

Item 168 (b). - Machine heads, whether imported separately or forming part of tha complete machine, including accessories except wrenches and oil cans … ad val. - British Preferential’ Tariff, free; Intermediate Tariff, 5 per cent.; General Tariff 10 per cent.

Recently those duties were altered to 10s., 15s. and 20s. respectively. I shall show directly that the average cost of an imported sewing machine head to the importer is about £3 10s. The general -tariff of 10 per cent, on that amount is only 7s. as against the new general duty of 20s. The Minister failed to inform honorable senators of six little words that had been added to the schedule “ To be dutiable according to material,” the operation of which will vitally affect the cost of complete sewing machines. The old rates of duty on a complete machine were -

Stands including transmission gear, whether imported separately or forming part of a complete machine (except belts or wooden parts imported separately); cabinets, cover* and tables imported forming part of the complete machine . . . ad val. - British Preferential Tariff, 30 per cent.; Intermediate Tariff, 35 per cent.; General Tariff 40 per cent.

That has been altered to read -

Cabinets, covers, tables, stands including transmission gear, whether imported separately or forming part of the complete machine - To be ‘dutiable according to material.

So that instead of stands, &c., coming in at the old rate of 35 per cent. and 40 per cent. it will be dutiable in the future according to the material used. That is a very vital difference.

Prior to the 30th June last, the duty on an ordinary seven-drawer sewing machine and stand was £1 6s. 9d. Under the proposed legislation the duties will be head 10s., cabinet £2 16s.1d., stand 6s. 7d., outside casing1s., or a total of £3 13s. 8d. That will be an unduly harsh imposition on thrifty housewives, and it is one consideration that will induce me to vote against the bill. And this is merely a beginning. These businesses invariably come along and ask for higher and higher duties.

The Minister has indicated that from 45,000 to 50,000 sewing machines come into Australia each year. I shall adopt an average of 45,000 machines per annum for my calculations. The honorable senator has given the value of the machine heads imported at £160,000 yearly, which works out at approximately £311s. each. The value of cabinets and stands imported is £170,000, or an average of £3 15s., making the total for the complete machine £7 6s.

Senator Guthrie:

– Does that include duty?

Senator CHAPMAN:

– I presume it does not. Senator Barnes stated that 70 per cent. of the imported machines are sold in Australia at £19 4s. for cash and £24 for terms, and that the remaining 30 per cent. sell at from £14 to £17 each, cash. The letter read by Senator McLachlan puts an entirely different complexion on the matter. Which figures arewe to accept? Sewing machines which cost approximately £7 6s. each are retailed at tremendously high prices, mainly because of the extravagant methods of distribution. The companies have canvassers perambulating the country in motor cars, each carrying a sewing machine - an exceedingly wasteful and extravagant method of salesmanship. That is certainly not fair to the public. Some honorable senators have referred to this subject rather vaguely, but I submit that if the companies do not voluntarily reduce distribution costs, the Government should take action to compel them to do so. Judging by the general tenor of the speeches of honorable senators, I believe that the Government in reducing costs to the public, would receive their support.

Senator O’Halloran:

– The Government is trying to do that now by the introduction of Australian competition.

Senator CHAPMAN:

– That is not soEven the price of the Australian machine was too high. The machine that was made at Bendigo, was, according to the report of the Tariff Board, sold at £15 15s. The company concerned went into liquidation in 1926 after producing 1,500 sewing machines.

SenatorGuthrie. - That company made a very good machine.

Senator CHAPMAN:

– That may have been so, but the fact that it went into liquidation within a short time of commencing operations shows that this is practically a hopeless proposition. The trouble is not the actual cost of making the machine, but the cost of distribution. Some8,000 machine heads are each year fitted with Australian stands and cabinets. The Government by imposing higher duties upon imported stands and cabinets would give the Australian manufacturer an. opportunity to establish this industry successfully. If we wish to establish Australian industries, let us concentrate on those which have a chance of success, and which will not require more than a reasonable measure of assistance. We are asked now to give a bounty of £2 and to impose a duty of 10s. for the benefit of the Australian manufacturer. He is therefore to receive equivalent to £2 10s. when the average import value of 45,000 machine heads is £311s. The total assistance then given to the Australian manufacturers would more than pay the wages of the men employed in the industry. It would certainly be preferable to absorb those men in other industries or to pension them off and allow them to remain unemployed for the rest of their lives.

SenatorO’Halloran. - The amount of the bounty is limited to £20,000 in one year.

Senator CHAPMAN:

– The amount payable on each machine head is fixed at £2 10s. while the import value is only £311s.I am opposed to the bill.

Senator E B JOHNSTON:
Western Australia

– I am opposed to the bill and I am sorry that the Government has seen fit to introduce it. There is no justification for a bounty on sewing machines manufactured in Australia. If a bounty is to be given in this instance, it should be given to every secondary industry. The Government has failed to make a case in justification of this bounty. A bounty on sewing machines is no more justified than a bounty on tin billy cans, pannikins, and1 sausage machines. It would be preferable to grant a bounty on the whole of the sewing done on the machines. It has been stated that the price of the imported sewing machine is £19 4s. cash, and that the Australian machine is to be sold at £15 15s.

Senator Payne:

– At from £15 15s. to £17 10s.

Senator E B JOHNSTON:

– The Singer machine is sold for £19 4s. cash, or £24 on terms.’ On the sale of each machine a commission of £5 is paid to the district agent. The company indulges in expensive advertising and has to bear the cost- of a ‘door-to-door canvass throughout Australia. It makes handsome allowances ‘ for old .machines that are traded in, and it provides an efficient, service for some years after a machine has been purchased. The Government has emphasized the fact that this machine costs £19 4s. cash, and is, therefore, an expensive machine, but it is, of course, carrying many burdens such as commission, advertising and service, The thrifty housewife is able to purchase both English and American makes of machines at a much lower price than £19 4s. and indeed at a very much lower price than that at which the machine manufactured at Bendigo is to be sold. At the present time there are a large number of cheaper machines available to the housewife who is prepared to purchase at a store. I therefore can see no reason why the people of this country should pay a bounty of £2 a head on the production of sewing machines to enable them to be sold at from £15 15s. to £17 10s, I also strongly object to the proposed increase of duty to £3 per head. I have with me a little handbook entitled Memories. It is issued by McWhirters,

Limited, The Valley, Brisbane. lt refers to the home where mother is queen and says that “The Valley5” sewing machine occupies a very important position in every home. The price of the “New Valley A” sewing machine is £12 12s. complete, freight paid.

Senator Guthrie:

– Where is that machine manufactured ?

Senator E B JOHNSTON:

– It is an imported machine. The handbook does not say whether it is American or British. The price of the “ Valley A. G.” machine is £13 13s. complete, freight paid.

Senator Dunn:

– Is it a German machine?

Senator E B JOHNSTON:

– I understand that it is an American machine which is specially made for McWhirters Limited, of Brisbane. The price of the “ New Valley B “ sewing machine is £14 14s. complete, freight paid. The price of the “Valley Central Bobbin” machine is £15 l’5s. complete, freight paid. The “Valley Special” sewing machine is a four drawer oak cabinet ball-bearing drop head machine. The stand is on castors. The machine is manufactured by the New Home Machine Company, and the price complete .is £9 18s. 6d., freight paid.

Senator Dunn:

– That machine is made by the Jugo Slavs.

Senator E B JOHNSTON:

– The honorable senator is entirely wrong. It is an American machine. I have also the ‘ price list of sewing machines sold by Anthony Horderns. The “Hordernia “ drop-head machine is quoted at £10 10s. The woodwork is of quarter sawn polished oak and the machine has ball-bearings and other conveniences: Tye and Company Proprietary Limited, of Melbourne and suburbs, advertise the “Tyanko” sewing machine at £13 15s., terms arranged. A. W. ‘ Dobbie and Company Limited, of Adelaide and Perth, sell a special “Dobbie” machine at £12 15s., on a deposit of £1 and 52 weekly payments of 5sl

Senator Hoare:

– Where is that machine made ?

Senator E B JOHNSTON:

– The catalogues do not contain that information. While in Sydney yesterday, I saw an English sewing machine that was purchased by its owner since the war for £1111s. The advertisements from which I have quoted do not state where the machines are manufactured; hut they include both English and American machines. I have just ascertained that the McWhirter machines are manufactured by the New Home Sewing Machine Company of America.. Another Queensland advertisement announces that the “ Tritonia “ sewing machine may be purchased for £11 10s. on special terms - £3 deposit with order and £1 monthly, from F. Tritton Limited, of 260 George-street, Brisbane. I turn now to advertisements relating to machines sold by David Jones Limited, Sydney. Model D. J.40 is on sale at £15 19s. cash, and Model D.J.20 at £15 cash. On many occasions during the year these machines can be secured by carefulbuyers at much below advertised prices. The Daily Telegraph Pictorial, Sydney, of 11th July, publishes an advertisement by David Jones announcing an extraordinary offer of 60 treadle machines, four drawers, drophead models’, for £1211s. cash, reduced from £15. These figures prove conclusively . that prices for sewing machines quoted by the Assistant Minister and Government supporters were misleading because, as I have already stated, the retail price of £19 4s. for the Singer sewing machine includes costs of door-to-door canvassing, allowance on trade-in machines, commissions, &c. Housewives may obtain machines of excellent quality for from £10 10s. upwards.

Although I was impressed by the incursion of one or two honorable senators into the realms of poetry, their efforts did not inspire me to emulate their example ; but when Senator Dunn was speaking I could not help recalling the parable spoken by the Great Teacher ‘ when he said - “ Behold, a sower went forth to sow.” In Australia there are many people engaged in the occupation of sowing, and I take this opportunity to remind the Government and its supporters that the sowers in our primary industries are contributing well over £500,000 a year in bounties to protect our secondary industries. If the Government, in continuance of its present policy, brings forward every week,, and some times two or three times a week, bills for the payment of bounties on the products of secondary industries, I am afraid that soon the sower in our primary industries will no longer be able to follow his timehonoured calling, because of the burdens imposed upon him. If to-day there arose a modern prophet, and in these times of equality of the sexes that prophet might be a woman, he or she would probably say, “Behold, a sewer: she went forth to sew.” Housewives in all Australian homes in rural as well as urban areas are busily engaged in sewing. This essential part of their domestic duties should not be interfered with by the addition of a financial burden in the way of higher costs on the household machine. The new duty of £3 plus a bounty of £2 on each sewing machine head is altogether too much.

Senator Rae:

-Will every woman be required to buy a new machine?

Senator E B JOHNSTON:

– No, but every day young people throughout the country are making new homes; and one of their first requirements is a modern sewing machine which, as I have shown, may be purchased from £1111s. upwards. We are told further in the parable that when the sower went forth to sow, “ some seeds fell by the wayside.” I trust that this bill will be one of the Government measures to “fall by the wayside.” I hope that the Senate will reject it and thus prevent another burden from’ being imposed upon the Australian woman in her home.

Senator REID:
Queensland

.- I am inclined to believe that the Govern- ment really wishes the Senate to reject this bill, so that it will be possible to charge it with obstructing Government policy. The arguments adduced in favour of the measure have not been convincing. The Bendigo company which, we’ are informed, will be re-established to carry on the manufacture of sewing machines, failed in its initial enterprise because, I assume, the product did not satisfy the people of Australia. Possibly the company lacked sufficient capital to manufacture on a large scale ; but if its machines had proved satisfactory the. Australian demand would have been sufficient to keep the concern in operation. I know nothing about the machine which the company in question manufactured. I doubt that I have ever seen one; but I am convinced that if it had proved efficient, and if the price had been right, it would have made headway in the Australian market.

Senator Barnes:

– The company sold all the machines which it manufactured.

Senator REID:

– Possibly it did, but we are not informed of the price at which they were sold. Perhaps the company sacrificed them in order to get them oil its hands. , We. have been told further that, if the bill is passed, the industry to be established will provide employment for a considerable number of operators in Bendigo, Victoria. We hear the same story on every occasion when bounty proposals, are under discussion.. Invariably the expectations are not realized. Unfortunately, . the unemployment problem is becoming more serious from day to1 day. It is a matter for great regret that -so many of . our people are unable’ to procure employment, but- ,1:: am sure that bounty proposals in relation to secondary industries are not the best remedy. If I thought they were, I. should vote for this bill. We all know that the majority of Australian industries are overmanned, and that there is a restricted demand for the output. In many industries men are working only half time, and in others the work is being rationed. The present is a most inopportune time for the introduction of this bill, because the demand for all products, including; the household sewing machine has, for. the time .being, practically disappeared. I understand that the Bendigo company proposes to confine its operations entirely to the manufacture df sewing machines for household use. I am afraid, however, ;that the new duty and the proposed bounty may interfere with the importation of the heavier machines required, by clothing trade manufacturers. If so, the higher cost will be passed on to the. general public, and in this way the difficulties in connexion with the cost of living, will be increased.

Senator McLachlan:

– The bill scarcely deals with manufacturers’ machines.

Senator REID:

– The ordinary sewing machine’ is suitable for domestic use, but a heavier type is required for men’s clothing. Competition in the Old Country will result in cheaper sewing machines being sent to Australia. I have a relation living near the Singer factory on the Clyde, outside Glasgow, and I am informed that the employees there are working only half time because of .the reduced demand for machines, both for the British trade and for export. The New Home machine is giving a lot of satisfaction. It is sold largely by McWhirters. of The Valley, one of the largest retail stores in Brisbane, as well as by other houses there. The average price is about £12 10s., and there is not a more efficient machine on the market. ‘ “!

Senator O’Halloran:

– Made in Germany by an American company !

Senator REID:

– No. I hold no brief for America, but sewing machines can be made as cheaply and as satisfactorily in the United ‘ States of America’ as anywhere else. The New Home Company makes many articles besides, sewing machines. The Singer is much dearer than the New Home, but it includes many devices not found in the other machine. The New Home does hot require special needles. I cannot see how the Australian housewife .is to.be supplied, at an attractive price, ‘ with a locally-made machine that will meet her requirements as well as those already on the market. Australia is not in a position at the present time to pass legislation that would lead manufacturers to believe that this Parliament can provide them with bounties to bolster ,up industries that cannot stand on their own feet. We . are. . assured that eventually the bounty will not be required.; but I know of no industry that has ever reached the stage at which it was prepared, to carry on without assistance, once it had been spoon-fed. We must guard against glv. ing the outside, world the. impression that the Government has sufficient, money to spare, to enable it to give £20,000 to assist this or any other industry. The country is about as hard pressed financially as it could be. Industries should bc encouraged to become selfreliant. In view of the present state of the finances, and for the other reasons that I have mentioned, X oppose .the second reading of this bill.

Senator SAMPSON:
Tasmania

– The bill seems to be having an unfavorable reception. Its object, I take it, is that some day Australia shall be able to make its own sewing machines, but meanwhile, if the bounty were granted, housewives would have to pay substantially more for their machines than they do at the present time. I should imagine that a bounty would be quite unnecessary in this industry, because the amount of protection afforded through the tariff is enormous. There is a specific duty of 10s. British, and £1 general tariff, upon each imported sewing machine head.’ There arc also duties of 75 per cent. upon the table, and 45per cent. on the ironwork. The totalduty, apart from the proposed bounty of £2, represents an increase of approximately 200 per cent. in the cost of these machines. This proposal is not to benefit an existing industry, but to put easy money into the pockets of, company promoters. This is no time to adopt a spoonfeeding process to encourage such a fantastic scheme as that contemplated by the bill. . It would mean the resuscitation of a bankrupt company. The Tariff Board’s report on this matter is full of “ ifs “ and “buts “ ; it contains nothing of tangible value ; it is vagueand elusive in its terms. One would be a superoptimist to hope that Australia would benefit from the establishment of such an industry, or that these machines would be produced in this country in any great quantity. The secret of success in the manufacture of sewing machines, as of almost any other article, is mass production. Nobody believes that the factory proposed to be established, if the bill is passed, would adopt mass production. Drophead machines, . thoroughly guaranteed, can be. purchased from any large general providers for from £10 to £.13 10s. each.’ They are sent all over the world in enormous quantities. I do not think that the demand for locally-made machines would be sufficient to make the establishment of an up-to-date plant a profitable venture. In view of the terrific tariff imposts already in operation, I fail to see that a bounty isrequired. The. whole proposal seems to be rather unsavoury, and I trust that the Senate will reject the bill.

Debate (on motion by SenatorHoare) adjourned.

page 5232

APPROPRIATION (WORKS AND BUILDINGS) BILL 1930-31

Second Reading

Senator BARNES (Victoria-Assistant

Minister) [2.15]. - I move-

That the bill be now read a second time.

The purpose of this measure is to provide out of Consolidated RevenueFund the sum of £130,570 for additions, new works, buildings, &c, for the year ending the 30th June, 1931.

The amount which Parliament provided last year for similar services was £290,576, and the actual expenditure for that year amounted to £245,536. The amount which Parliament is now asked to provide is, therefore, £160,006 less than was voted, and £114,966 less than was actually expended last year.

The total amount provided for by the bill is made up as follows : -

I shall be pleased to supply whatever details honorable senators . may require when the bill reaches the committee stage.

Senator Sir GEORGE PEARCE (Western Australia) [2.16]. - On the vote for “ Naval establishments “ I wish to discuss Cockatoo Island Dockyard. Some time ago a judgment was delivered by the High Court of Australia, the effect of which was to prevent the Commonwealth from undertaking . private work in that dockyard; that is. to say,’ its operations were confined to the carrying out of purely governmental work. The result, of . course, has been that, in the absence of work for any of the departments, the establishment has been rendered partially idle. It was obvious to the last Government that a tremendous amount of capital was lying idle and that, no matter what it did, the dockyard could not be made a payable concern. It has a very valuable plant which, if kept fully employed, would provide constant work for artisans and others, and, in addition, would be available to the Commonwealth as a going concern for repair and other work for the Navy should Australia, unhappily, find herself involved in another war - a contingency that we all hope will never arise. The last Government, therefore, instituted inquiries with a view to leasing the dockyard to a private individual or a company, who or which could undertake, not only naval work and work for other government departments, but also outside work, without coming into conflict with the Federal Constitution. Just before that Government went out of office, it entered into negotiation with a gentleman who represented certain capital in Sydney, and an agreement was tentatively drawn up.

Senator Sir GEORGE PEARCE I cannot remember his name, but it will appear on the files in the department. He was a man of substance, and represented a substantial amount of capital. Speaking from memory, this tentative agreement provided for the payment of a rental of about £10,000 a year, and 5 per cent, on the turnover.

Senator Sir GEORGE PEARCE.E think that it was. The offer was a remarkably good one, and I have no doubt that, had it remained in office, the birt Government would have brought the proposal to Parliament and recommended its adoption. Had the agreement been carried out, Cockatoo Island Dockyard would have been able to undertake every class of private work, and iti magnificent plant, instead of lying idle, would have been kept operating on a great deal of work that I feel sure is going out of Australia at the present time. I expected the present Government to carry the matter through when it assumed office, - because such an action would have resulted in the avoidance of a certain amount of unemployment. Under existing conditions the dockyard cannot undertake private work. I believe it was Senator Rae who expressed the view that its plant should be utilized in a certain direction. If he will study the High Court judgment to which I have referred he will find that, under its existing constitutional powers, such a course is not open to the Commonwealth. In the case in question, the dockyard authorities ten- dered for the supply* of certain electrical machinery for the Bunnerong power station. A private firm applied to the High Court for an injunction restraining the Commonwealth from proceeding further with the matter, and the injunction was granted. I believe that there is not another plant in the Commonwealth which is equal to that at Cockatoo Island Dockyard; therefore, no private firm is capable of carrying out every class of work that can be done there. It has astonished me to find that this Government has not proceeded with the matter. No statement has been made as to what has occurred. If the Assistant Minister will consult the files he will learn that the last Government was negotiating with a man of substance, and that the bona fides of the company could not be questioned. I very much doubt whether, iti the existing state of depression, the same advantageous terms could be obtained. When the negotiations were begun, the depression was not so intense as it is at the present time, and probably the person with whom the last Government was negotiating would not take the same roseate view of the possibilities. It is a pity that, because of constitutional difficulties, such a valuable plant cannot be used to its full capacity by the Commonwealth. I cannot for the life of me see how the leasing of the dockyard to a private firm would be in any way antagonistic to the policy of the Labour party, even assuming that that party stands for State ownership. If under State ownership the dockyard is not permitted, because of constitutional limitations, to do certain work, what on earth is the good of adhering to a paper principle? I make this suggestion, not in any party sense, but merely because I regard it as a waste of capital to allow that valuable plant to lie idle. On a recent Sunday, when I Ava3 in Sydney, I passed the dockyard, and it appeared to me that its operations were confined to work upon a small steamer of 200 or 300 tons. Considering the number of large vessels that trade to Australia from overseas, there must be a lot of work that could be done at the dockyard if it were leased to a private company. In the interests of Australia, as well as with a view to relieving the present unemployment, I recommend that the Government look into the matter to see whether the offer, which was made to the last Government, is still open; or, if not, whether a modified agreement can be entered into.

Senator DUNN:
New South Wales

– I agree with many of the statements that have been made by the Leader of the Opposition (Senator Pearce). For some years, Cockatoo Island Dockyard has been a political shuttlecock. I can say without fear of contradiction that it is one of the finest establishments of its kind south of the line. It has the necessary plant, not only for modern naval construction, but also for the building of passenger steamers and cargo vessels. In 1913, the Fisher administration, in which the present Leader of the Opposition was Minister for Defence, commenced to establish the nucleus of an Australian Navy. It entered into negotiations with the McGowan Government in New South Wales, and that Government handed over to the federal authorities the control of Cockatoo Island. The whole of the plant which at that time was utilized by the State Government for the construction of dredges and other vessels, was transferred to Walsh Island Dockyard, at Newcastle. The first development in connexion with naval construction at Cockatoo Island was the assembling of the T.B. class steamer known as the Warrego. It was built in sections at Barrow-in-Furness shipped to Australia as cargo, and assembled on what is known as the south slip, on the Balmain side of Cockatoo. Experts were brought to Australia from different privately-owned naval shipbuilding establishments in Great Britain, and came under the supervision of Mr. Cutler, a very fine Australian engineer, who at that time was general manager of Cockatoo Island Dockyard, but who eventually took charge of Walsh Island. Mr. Barr was the naval engineer and architect who came out to take over the administration of Cockatoo Island Dockyard, together with another fine type of British expert in modern structural construction from Chatham Dockyard - Mr. King Salter. The last-named gentleman, with a ‘limited amount of money, built up the very fine establishment that Cockatoo Island Dockyard is to-day. After the Warrego, the Government of the day put on the slips the Swan, the Huon, the Derwent and the Torrens, four destroyers of the River class. It then decided to embark upon a larger type of construction, and began with the cruiser Adelaide. The Adelaide was then laid down and built, and was followed by the Brisbane, another cruiser of the same class.

Senator Sampson:

– How long did it take to build the Adelaide?

Senator DUNN:

– If my memory serves me right, about three years.

Senator GUTHRIE:

– It cost twice as much as it should have cost.

Senator DUNN:

– I am not very much concerned for the moment about the time taken to build the Adelaide or its cost. The fact remains that here were Australian artisans for the first time undertaking the work of shipbuilding under the supervision of British engineers. I enlisted from Cockatoo Island in 1914, and was away for five years, but I am led to believe that during the war period from 3,000 to 4,000 men were constantly employed on the island doing effective work in fitting troopships, and in general engineering construction. As time went on the Moonbah was built. It was subsequently acquired by a private firm, and is now used as a coal hulk in Port Philip. A large ocean-going coal tender called the Biloela was also built for the Navy, and is a very fine type of vessel; but the crowning effort of Cockatoo Island was its successful construction and launching of the Ferndale and Fordsdale, vessels which were completed during the administration of the Bruce-Page Government. They were capable of steaming eighteen knots, and of being used as auxiliary cruisers. Their guns had a very effective range. On arrival in Great Britain after their maiden voyage they were carefully examined by British naval and marine engineers, who were anxious to see what Australian workmanship was like, and Lloyd’s surveyors gave an excellent report on the quality of that workmanship. After the completion of the Ferndale and Fordsdale an era of depression set in, and I well recollect, as one of the Cockatoo Island vigilance committee, the agitation that took place to secure other work for the dockyard. The officials submitted a tender for the construction of the turbo-alternators for the

Bunnerong power house, which was then under construction. The Bruce-Page Government gave them every assistance to go ahead, and see if they could keep the wheels of industry turning on Cockatoo Island. The dockyard’s tender for these alternators was successful, but private enterprise - I believe it was the British General Electric Company - took out an injunction against the dockyard on the ground that it was a federal institution, and, under the Federal Constitution, had do power to undertake an outside contract. When the case was heard before the High Court private enterprise succeeded, the bench holding that the Commonwealth Government had no power under the Constitution to undertake this contract. The dockyard was practically rendered idle. It covers 75 acres. The principal dock is capable of holding the longest vessels of their type in southern waters,- the Canberra and the Australia. No. 2 dock is also a fine dock There is on the island a splendid pumping plant which can pump out all the water of the big dock in two hours. It is a performance not excelled anywhere else in the world. There are splendid sliP- ways, adequately fitted with cranes, and all the necessary machinery for the building of vessels.

Senator McLachlan:

– Does Walsh Island do the same class of work?

Senator DUNN:
NEW SOUTH WALES · ALP; LANG LAB from 1931

– Yes; but not with the efficiency of Cockatoo Island, because its machinery is not so up to date as that of Cockatoo Island. While all this plant is lying idle, vessels which could be built in the dockyards of Sydney harbour are being built overseas. Two vehicular punts of the Kangagooloo type - they are simply punts with engines and propellers fitted on them - which ply across Sydney harbour between the Sydney side and Milson’s Point, were recently ‘built in Great Britain. The Dee Why and the Curl Curl, two recent additions to the Manly ferry service, were also built overseas, although the other vehicular punts and ferries of the same company were built at Morts Dock. The Illawarra Steamship Company, which owns a number of small steamers known as the mosquito fleet, has its vessels built overseas. The New South Wales Government has had the Bombo, a steamer of 600 tons, which trades between Kiama and Sydney and conveys blue metal, built overseas. Yet the fine establishment we have at Cockatoo Island is, as the Leader of the Opposition (Senator Pearce) declares, getting into a state of ruin. I know that the Government is sympathetic with the workers on Cockatoo Island, but it is powerless to do anything, because of the limitations of the Federal Constitution. In addition to Cockatoo Island, in Sydney Harbour we have Morts Dock at Balmain, Woolwich Dock - Cockatoo Island is sandwiched between the two - and Garden Island, with its very modern plant. At Newcastle there is a floating dock, a fine piece of work which is a very necessary adjunct to a shipping port of the magnitude of Newcastle, and alongside this is Walsh Island, owned by the State Government. The estimated value of the plant on Cockatoo Island is over £1,000,000. The question is whether it would be in the interests of the nation to lease Cockatoo Island to private enterprise. I understand that the Bruce-Page Government advertised throughout the world calling for tenders for the leasing of the island, but that no substantial offer was received.

Senator McLachlan:

– A tender was received which the Government was willing to accept subject to certain conditions.

Senator Sir George Pearce:

– That tender was not submitted in response to the advertisement. It came in subsequently.

Senator DUNN:

– I understand that the offer was for £10,000 a year.

Senator Sir George Pearce:

– And 5 per cent, on the turnover.

Senator DUNN:

– I should not be prepared to lease to private enterprise a dockyard and plant worth over £1,000,000 for £10,000 a year and 5 per cent, on turnover. The whole bugbear is the Constitution. Cockatoo Island could cater for the whole of the mercantile marine of Australia. It could build aeroplanes and seaplanes for commercial and defence purposes. When this period of depression passes I hope that something can be done with this huge establishment. It is a national asset. It has some of the finest machinery obtainable capable of providing employment for 4,000 hands, but that machinery is now lying idle. The manufacture of lighter machinery, such as sewing machines, to which Senator Rae referred ii few days ago, could he undertaken more advantageously at Lithgow than at Cockatoo Island. Something Mall have to he done at an early date, to improve the position of Cockatoo Island, and I hope it will not bc long before every wheel in that establishment is on the move. I have a vivid recollection of every workshop in that vast establishment operating for three shifts a day and about 4,000 men being employed for many years without a break. From the time when the Cockatoo Island Dockyard was taken over by the Fisher Administration in 1913 until 1927 there was not an industrial dispute, with one exception, when the men ceased work for a fortnight. We are indebted to the Leader of the Opposition for introducing this matter, and I trust that something will be done at an early date to enable Cockatoo Island to render a greater service to the community.

Senator H E ELLIOTT:
VICTORIA · NAT

, - I trust that in the construction of the National War Memorial, or any other public undertaking in the Federal Capital Territory, the supervision will be better than it was during the regime of the. late Federal Capital Commission. When the Federal Capital Commission was in control of building operations in Canberra honorable senators were astounded to learn, that the reconstruction of Yarralumla had cost £78,000, the Prime Minister’s lodge £30,000, and a clog kennel at the lodge £30. tinder a proper system, of costing, these amounts would not have been so high.

The PRESIDENT (Senator the Hon W Kingsmill:
WESTERN AUSTRALIA

– I direct the honorable senator’s attention to the fact that no amount has been provided under this bill for a National War Memorial or any other of the items which he has mentioned.

Senator H E ELLIOTT:
VICTORIA · NAT

– A sum of £30,000 is provided for the National War Memorial .

The PRESIDENT:

– That was tie amount provided for last year. No appropriation is being made on that, account for this year.

Senator H E ELLIOTT:
VICTORIA · NAT

– Under the item relating to the reconstruction of the

Canberra-Goulburn road, I can direct attention to supervision in connexion with public works in the Federal Capital Territory generally.

The PRESIDENT:

– The honorable senator is not entitled to deal with items at this stage, but he may do so in committee. .

Senator H E ELLIOTT:
VICTORIA · NAT

– I wish merely to make some general comments on expenditure in the Federal Capital Territory. For some time the supervision appears to have been extremely lax. A hue and cry was raised over the unnecessary expenditure which was incurred by the Federal Capital Commission upon the items I have mentioned. I have been informed that these amounts were high because it was the custom at that time to build up what was termed a labour pool and that the costs and wages were supposed to be spread over, all buildings in the course of construction during a certain period. During the time the reconstruction work at Yarralumla was undertaken, and the Prime Minister’s lodge was built,, a number of other structures were in course of erection. With a view to keeping the expenditure on some, shall I say, “pet buildings “ at the lowest possible level, only the net time during which the workmen wen> actually employed on them was debited to the cost, whereas any time which the men lost through wet weather was charged up against the Prime Minister’s lodge and Yarralumla House. In that way the taxpayers were totally misled as to the money expended upon them. When future expenditure is being incurred in connexion with the National War Memorial, or on any other public work, the system of costing should have the closest investigation. The actual expenditure and the due proportion only of these other overhead and extraneous charges should be charged against the work.

I have recently obtained some very illuminating figures, which have apparently necessitated two months’ research, but which, under a proper system of costing, should have been available within a week, in connexion with the Federal Capital Territory Omnibus Service. According to the information with which I have been supplied, four “ Bean “ ‘buses, each of which carry eighteen passengers, -were purchased in February, 1928, from Dalgety and Company Limited, of Sydney. From the time of their purchase up to February of this year, which was only two years, the depreciation has been such that although the purchase price of each ‘bus was £830 9s. 8d., they are now valued at only £118 5s. In addition these ‘buses have been converted into twin rear-wheel vehicles, and have been equipped with new engines and chassis. They are like the Irishman’s gun, which had to be renewed by providing a new lock, stock and barrel. Yet they have still depreciated so enormously as to be practically valueless at the present time. Moreover, the taxpayers had to provide a loss on working expenses, which for the year 1927 was £932 7s. 4d., but, in the last financial year, increased to £14,019 7s. lOd. on working expenses alone, quite apart from depreciation. Surely it is time that those in charge of this department gave this matter very careful attention. I was further informed that this matter of the omnibuses was at present the subject of consideration, and that, as investigations had not yet been completed, no indication could be given as to the action to be taken. The officer who has been in charge of this department for twelve months should see that the investigations are definitely concluded. Although I opposed the transfer of the Seat of Government to Canberra with all the power at my command, I do not see that anything can now be saved by abandoning the project. The annual expenditure should, however, be reduced by conducting a closer scrutiny into the methods employed. I understand that the actual expenditure in connexion with the ‘bus service has not been disclosed. Under the present system an omnibus requiring a few drums of petrol obtains it through the stores branch and is debited with an arbitrary sum, in some instances amounting to £10, as overhead expenses, when all the work done in that branch is to make out an invoice and post it to the firm in Sydney which supplies the fuel. That is the only way the stores branch justifies its existence and the expenditure incurred in employing a staff. The unfortunate ‘bus service is, however, held up to derision as a white elephant, when the costing system is largely at fault. Surely some improvement can be made in the present system to enable the taxpayers to obtain a better idea of what the service is actually costing.

Senator O’HALLORAN:
South Australia

.- The Leader of the Opposition (Senator Pearce) raised a matter which vitally concerns the Government, and which, no doubt, will receive its very serious consideration. It appears that the late Government was negotiating with a view to leasing the Cockatoo Island Dockyard to a private firm under conditions which we were assured by the Leader of the Opposition would be quite satisfactory to the Commonwealth. There might be some difficulty, however, in arriving at a basis entirely satisfactory to the Government. I do not profess to bc as conversant with the history of that establishment as is Senator Dunn; but I know that Cockatoo Island Dockyard was primarily established as an arm of the naval defence of this country, and, as such, would have to be available if, unfortunately, we should ever be at war again.

Senator Sir George Pearce:

– That was provided for in the tentative agree. ment drawn up.

Senator O’HALLORAN:

– I shall deal with that later. Our hope and sincere desire are that we shall never again he engaged in an international conflict; but in view of the present state of world politics, it would appear that we have to maintain some measure of preparedness. I believe that we are making great strides towards the realization of that ideal which was attempted when the League of Nations was constituted, and that the possibility of settling international disputes by peaceful negotiation will be much greater in the future than in the past. If, however, the dockyard is to be an effective arm of our naval defence, it will have to bc available for that purpose at all times.

Senator McLachlan:

– The agreement provides for that.

Senator O’HALLORAN:

– There are two things which might cause difficulty in the event of the dockyard being leased to a company or a private individual. The first is that a company or individual might not maintain the plant and machinery as efficiently as it would be maintained by a government department. The second point is that, in the event of its being necessary to take over the plant hurriedly because of the nation becoming involved in war, we might be involved in considerable liability by way of compensation to the lessee. Those are points which would have to be considered by a government before it handed over the dockyard to a company or individual, as suggested by the Leader of the Opposition (Senator Pearce). A much simpler way out of the difficulty would he to amend the Constitution to enable the dockyard to accept work from outsiders as State-controlled institutions are able to do. For instance, the various State railway workshops may tender for, and accept, work from outsiders. There is no reason why the Commonwealth dockyard should be prevented from undertaking work from outsiders. If the Constitution were amended in that direction, the Government could then either lease the dockyard or undertake outside work.

One pleasing feature of the bill is that, despite the criticism to which the Government has been subjected outside Parliament, no honorable senator, so far, has repeated the wild statements regarding the expenditure proposed by the Government for the current financial year. Honorable senators are aware that, outside Parliament, some very extreme statements have been made about governmental extravagance. It is contended by some persons in the community that the Government has failed to realize the seriousness of the position confronting the country, and has, consequently, shown no real desire to curtail expenditure.

Senator Sir William Glasgow:

– These estimates are different from the ordinary items of expenditure. They provide no great opportunity for a reduction of expenditure.

Senator O’HALLORAN:

– There is a definite reduction of £114,966 compared with the amount expended last year. The Standing Orders will not permit me to discuss ordinary expenditure which is not covered by the bill before the Senate. If I were permitted to do so, I could show where similar savings have been made in the ordinary departmental ex penditure for the current year. But confining myself, as the Standing Orders require, to a discussion of the items provided in this hill, I point out that whereat the amount voted last year was £290,576 only £245,536 was spent, and the vote this year has been reduced to £130,570. In other words, the amount to be expended this year is £114,966 less than the amount actually expended last year.

The PRESIDENT (Senator the Hon W Kingsmill:

– The honorable senator is quite in order; but he will have a fuller opportunity of discussing the question of Commonwealth expenditure when the Appropriation Bill is before the Senate.

Senator O’HALLORAN:

– Although, generally, expenditure is being reduced, owing, chiefly, to careful supervision on the part of the Government and departments, in one direction an increase is provided for. Last year, £7,636 was expended in the development of Central Australia; this year it is proposed to spend £16,000 there. That money is to be spent on necessary public works for the development of that vast territory under the control of the Commonwealth. It will be utilized in opening up roads, sinking dams and wells, and in similar developmental work. The extension of the railway from Oodnadatta to Alice Springs, and the consequent possibilities for more intensive development of the pastoral land beyond Alice Springs, render such works necessary.

There is nothing in the bill to justify any charge of extravagance being levelled at the present Government regarding expenditure in the Federal Capital Territory. The only items are £600 for the provision of new machinery for the Government Printing Office, and the quota of the Commonwealth of the expenditure agreed upon between the Commonwealth and New South Wales Governments for the improvement of road communication with the Federal Capital. The Government’s proposals should commend themselves to the Senate.

Senator RAE:
New South Wales

– I desire to say a few words in connexion with the remarks made by the Leader of the Opposition (Senator Pearce) concerning Cockatoo Island. I have taken a considerable interest in Cockatoo Island and feel that the Senate is indebted to Senator Dunn for the particulars he gave u3 of the activities of the dockyard. It has always seemed to me that the leasing of a dockyard primarily established for defence purposes might lead to complications in the event of the dockyard being suddenly resumed for defence purposes. So far as the electors expressed their will when electing their representatives in this Parliament, a majority of the people of Australia decided that the Constitution requires amending. We may differ as to the method by which it should be amended, but there is a general consensus of opinion that the Constitution places some absurd restrictions on the Commonwealth. Both at the Cockatoo Island Dockyard and the Lithgow Small Arms Factory there are considerable quantities of costly and up-to-date machinery which for a considerable portion of each year lie idle because of the restrictions placed on the powers of the Commonwealth. While it would be better to adopt the suggestion of Senator Pearce than to allow the present state of affairs to continue indefinitely, I suggest there is another way out of the difficulty. If we can evade the provisions of the Constitution by leasing the dockyard to a private firm, while still retaining our right to resume it for defence purposes, we can evade them, and at the same time retain to this Parliament the control of the dockyard. What legal objection could there be to granting a nominal lease of the dockyard to the Prime Minister for the time being, or some other “ dummy “, at a pepper-corn rental? I do not see why we should, allow constitutional limitations to prevent us from devising ways and means to overcome the difficulties that present themselves. Some time ago it was decided to authorize the dockyard to manufacture certain articles which were not made by other Australian manufacturers. The same principle was applied to the Small Arms Factory at Lithgow, and in that way a fair amount of work has already been done in both establishments. It is most humiliating that a Parliament which claims to control the nation, and to have sovereign .powers in almost every other direction, should be so crippled because of a faultily constructed Constitution that it cannot do what all political parties believe it should be able to do. Although we may not agree regarding the nationalization of industry, we are all of the opinion that there are certain powers which the Commonwealth Government should possess, especially in the direction of manufacturing articles necessary for defence purposes. It must strike every honorable senator as absurd and wasteful to establish factories and equip them with machinery costing approximately £1,500,000, and then to permit them to operate only for a portion of the year. I trust that the ‘concrete examples that I have given of the evils that accrue to us by reason of existing constitutional limitations will stimulate our endeavours to evolve a remedy in the near future. That should be possible if we eschew academic and abstract problems and concentrate on matters definitely affecting the economic welfare of the country.

Senator H. E. Elliott referred to Canberra. While I happen to be in the peculiar position of having been the only dissentient New South Wales member at the time when Canberra was chosen as the site for the Federal Capital, I am of the opinion that as the majority, decided on that course of action and the Federal Capital has been established here, we should not starve or cripple it, notwithstanding the necessity to effect economies and to avoid unnecessary and wasteful expenditure. We should not adopt a mean and niggardly spirit with regard to the maintenance that is necessary to continue the Federal Capital, or to add to the comfort of those who have to reside here permanently. It would be quite another matter if a feasible plan were advanced by means of which Canberra could be satisfactorily disposed of.

The PRESIDENT (Senator the Hon W Kingsmill:

– The honorable senator is straying somewhat from the subjectmatter of the debate.

Senator RAE:

– I have no desire to do so, sir. We should willingly assent to any expenditure that is necessary for maintenance of the Federal Capital, and the surrounding territory, to prevent it from deteriorating in value. Such expenditure should not be viewed in a grudging spirit, engendered by brooding upon abstract matters.

It has been conclusively proved that this Government has effected substantial economies in various directions. This should put an end to the reckless charges that were referred to by Senator O’Halloran.

Senator BARNES:
Assistant Minister · Victoria · ALP

– The right honorable the Leader of the Opposition (Senator Pearce) appeared to make out a very strong case for the leasing of Cockatoo Island Dockyard, but Senator Rae has very ably presented the other side of the picture. As the country found it necessary at one period of its history to provide this instrumentality towards the preservation of peace, it would be particularly dangerous if we dispensed with the dockyard since the nation would be deprived of its services in times of need. So far as T can gather, Cockatoo Island Dockyard is at the moment busy, and will continue so for some time on governmental work.

I remind Senator H. E. Elliott that until quite recently the transport services of the Federal Capital Territory were under the control of the Federal Capital Commission. Since the Department of Works and Railways has taken over the administration, it has made exhaustive investigations into many matters that apparently needed attention, and already anomalies have been corrected with regard to the omnibus service. It is unnecessary for mo to traverse the ground already covered by honorable senators by way of general discussion.

Question resolved in the affirmative.

Bill read a second time.

In committee :

Clauses 1 to 3 agreed to.

Schedule.

Senator GLASGOW:
Queensland

– I should like some information from the Minister in charge of the bill with regard to the item “ Construction of buildings and roads, engineering services and water boring, £10,000,” under the sub-head “ Central Australia.” Now that the railway has reached Alice Springs, is the Government doing anything to improve water facilities along the stock routes from the north-west, and along the telegraph lines to Alice Springs, from

Victoria River and Newcastle Waters? Also, have improved water facilties been provided along the stock route from Newcastle Waters to Anthony’s Lagoon, through to the Barkly Tableland?

Senator BARNES:
Assistant Minister · Victoria · ALP

– The amount referred to by the honorable senator includes provision for wells and boxes to the extent of £2,718. There are also two other separate items of £1,000 for new wells, and £1,000 for trial bores, but I am unable at the moment to state precisely where the improvements are being effected.

Schedule agreed to.

Preamble and title agreed to.

Bill reported without amendment; report adopted.

page 5240

APPROPRIATION BILL, 1930-31

Bill received from the House of Representatives.

Standing and Sessional Orders suspended, and bill (on motion by Senator Barnes) read a first time.

Second Reading

Motion (by Senator Barnes) proposed -

That the bill be now read a second time.

Debate (on motion by Senator Sir William Glasgow) adjourned.

page 5240

SEWING MACHINE BOUNTY BILL

Second Reading

Debate resumed from page 5232.

Senator HOARE:
South Australia

– The object of the Government in submitting this bill is to encourage the establishment of a new industry which, it is hoped, will give employment to a large number of Australian operatives. An enterprise for the manufacture of sewing machines in Australia, if established in Bendigo as contemplated, will be n move in the direction of the decentralization of industries and, as such, the project should commend itself to honorable senators. It has been urged by those who are opposed to the bill that, to ensure success, the industry must he conducted on mass production methods. 1 remind them that, in the United States of America, which is regarded as the home of secondary industries, mass production methods were not always possible. Many of the huge manufacturing concerns which now play such an important part in the industrial life of that country began in a small way. There is reason to believe that we shall have the same experience in this country with respect to a number of industries including possibly the manufacture of sewing machines. Senator E. B. Johnston went to considerable pains to prove that different types of household sewing machines were being retailed by a number of big business bouses at prices below the figures quoted for the Australian sewing machine when the Bendigo company was in operation. I do not challenge the figures presented by the honorable senator, but I remind him that the practice in all countries where secondary industries are protected, is to supply first the home market and then dispose of the surplus products overseas at prices, in some cases, lower than are charged in the country of origin. As we all know, our primary products command higher prices in the home market than are obtained overseas for the surplus production. I imagine,therefore, that the prices of imported sewing machines quoted by Senator Johnston bear somewhat the same relation to prices in the home markets as the prices which we receive for our primary products abroad bear to the prices obtained in Australia. As to the objection that the industry is to be established in a provincial city in Victoria, I can only say that, in matters of this kind, we should take the broader view. If I thought otherwise, 1 should advocate the claims of Adelaide as the industrial centre more likely to ensure the success of the venture. Senator Reid apparently objects to this bill on the principle that assistance in the firm of a bounty is not an economic proposition. The honorable senator was careful to avoid any reference to the Queensland sugar industry, which has developed on much the same principle. If the assistance at present given to that industry were withdrawn, the effect upon the northern State would be disastrous, and New South Wales and Victoria also would suffer, because Queensland imports manufactured goods and other commodities largely from the southern States in return for sugar sold in southern markets. If we are to remain true to the principle of protection, we must give careful consideration to all proposals for the encouragement of Australian industries. The high standard of living and the improved labour conditions observed in our industries demand efficient protection from outside competitors. The Tariff Board which inquired into this matter, in 1925, made the following comments in its report : -

Severe competition from overseas is being experienced by the local industry. The price at which the locally-made .machines are sold is £15 15s. net cash, whereas some similar imported machines are sold as low as £12 10s. Some of the imported machines are sold at higher prices than the locally-made machines. For instance the Singer machine is sold on extended terms for £24 4s., and for cash at £19 4s. Whereas imported machines can be landed in any State at the same prices, locally-made machines have of necessity to pay freight to the different States.

The present nominal capital of the Bendigo Sewing Machine Company Limited, as disclosed by its latest balance-sheet, is £50,000, divided into £5,000 shares of £10 each; of this amount about £14,000 has actually been paid up. The evidence points to the fact that the further development of the industry is hindered by lack of capital, and that this lack is attributed to the fact that, so far, owing to its failure to successfully compete with imported machines, the Bendigo Sewing Machine Company Limited has not shown any profits, but as a matter of fact, has incurred losses on its sales.

The failure of the company, it would appear, was due to the lack of sufficient capital to extend its operations so as to meet the demands of the local market. Protection in some form is more urgently needed by an industry in the early years of its development. When it reaches the stage at which mass production is possible, it should no longer depend on governmental assistance. I understand that the Bendigo company manufactured, in all, about 1,400 machines. This was not nearly sufficient to keep pace with the requirements of the home market, but owing to the lack of capital it was not possible for the company to obtain the most up-to-date machinery. If this bill is passed we shall have the satisfaction of knowing that at least we made an attempt to establish in Australia what should be an important industry.

The right honorable the Leader of the Opposition (.Senator Pearce) asked why the industry was established in the first place in Bendigo. I suppose operations began there because the local business people were sufficiently enterprising to subscribe the necessary capital to form a company. As already shown it failed through lack of Government interest. If we are to manufacture sewing machines in Australia I should say that Lithgow would be a very suitable location for the industry. In the Small Arms Factory there we have up-to-date machinery, which with slight alterations could be utilized for the purpose. I should think that machines could be turned out cheaper there than in any other part of Australia. But I hold no brief for any particular part of the Commonwealth. I want industries to be established in Australia, which will absorb our own unemployed, and the manufacture of sewing machines should open up many avenues of employment, particularly for cabinet makers and moulders. The contention that heavy freightage will have to be paid on the transport of machines from Bendigo to, say, the furthest part of Western Australia, has already been disposed of by the Assistant Minister, who has shown that the machines are to be sold at a standard price in all capital cities. The Bendigo Sewing Machines Limited started making household sewing machines in 1924, on the understanding that the Government of the day would soon bring into operation the deferred duty on sewing machine heads. The Government did not do so, and the Bendigo company next year applied for a bounty of £2 10s. for sewing machine heads. The matter was referred in the usual way to .the Tariff Board for investigation, and after a thorough inquiry the Tariff Board recommended, in December, 1925, that a bounty be paid for three years at the following rates : -

The reason given by the Tariff Board for its recommendation was that the Bendigo company was then only producing machines at the rate of 40 a week, or 2,000 a year, whereas it had been the practice to expect a new industry to meet at least 40 per cent, of Australian requirements before any tariff or bounty assistance would be given. To my mind, that was just the time to give the industry the assistance it required. I do not think the Government should have “ lingered over the matter all these years, in the meantime allowing sewing machine manufacturers all over the world to get a grip on the Australian market. If we had given the Australian company assistance in 1924, the manufacture of sewing machines would possibly have been on a sound basis before now, and perhaps it could have got along with the assistance only of an effective duty and not a bounty. I have heard that the machines which were made at Bendigo gave every satisfaction. I went to buy one in Adelaide, and but for the fact that there was none available, because the company had ceased to manufacture them, there would have been one in my home to-day. If there is one thing I stand for, it is the purchase of goods of Australian manufacture. From head to foot I am Australian-made so far as my wearing apparel is concerned. If we all made it a practice to buy Australian-made goods, we should help to build up Australian industry, and thus give employment to our own people and make Australia the nation we want it to be. Every industry must have its beginning. We do not know whether it will be a failure until we give it a try-out. We cannot build up industries by following the policy adopted by the Bruce-Page Government in regard to the sewing machine industry, that of casting it aside. Many other industries now flourishing would have perished if the same policy had been applied to them. Instead of that, by the assistance of bounties, they are now employing thousands of people. One of them is the iron and steel industry of Newcastle. It should be our aim to make Australia independent of other countries. We have peace to-day, but it may not last. We should be independent of the outside world; in time of war we should be able to manufacture any implement that Australia might require, and we should set about preparing to do so in time of peace. There are many things we have not tried to manuf acture in Australia. If the bounty system were employed, we might be able to give a start to the manufacture of such things as motor car engines- and aeroplane engines, though, personally, I should like to see the Government launch out in that direction itself, because then we should not be paying our money away to others. I do not think that we should adopt too pessimistic an outlook in regard to the sewing machine industry. Surely there is a bright side to it. If the people who have said that they will form a company are prepared to put thousands of pounds into the venture, the Government will be perfectly safeguarded; it can hold back the payment of any bounty until satisfactory proof is furnished that the company is a bona fide one, and will carry out its intentions. I think that honorable senators are often somewhat parochial in their attitude towards bounties. I should like them always to look at these matters from an Australian viewpoint, because, after all, we are one nation and one people, and an industry that is working satisfactorily in one.State must benefit to a greater or less degree the whole of Australia. I think that we should give this particular industry a trial to see how it pans out. There is to be a limitation to the payment of the bounty, and when that limit is reached, in all probability the manufacture of sewing machines will be on a sound footing. It is useless to say that we believe in Australian industry if we limit the support that we give to it. I think that we should be consistent and that we_should realize that if it is worth while building up one industry, it is equally worth while building up others. If the Government is defeated on this measure, it has, at least, endeavoured to do its duty as it sees it. It is regrettable that there is no report of the Tariff Board available later than that of 1925 ; but, apparently, the board was favorable to the payment of a bounty at the time. In the absence of a recent report, we must be guided by the information supplied to us by the Assistant Minister (Senator Barnes). I hope that honorable senators will give the matter careful consideration, and that they will pass this bill for the good of Australia in general.

Senator O’HALLORAN:
South Australia

– This bill appears to be having a more chequered career than other measures which have been before the Senate during the present session. At one stage of the session, it appeared as if honorable senators would wholeheartedly stand by the Government’s efforts to establish industries and extend others, and, in so doing, assist in making Australia the self-contained nation which the Labour party aims to make it. Judging by the tone of the remarks of most honorable senators who have spoken on this bill, I am rather fearful that it will not meet with the fate which, on its merits, it deserves. Unlike other legislation of a similar character it will not pass the Senate, and have an opportunity to blossom among other legislative flowers. I am afraid that its tender roots will be torn from the fertile soil in which they were planted by the honorable Minister (Senator Barnes) a few days ago, and that this beautiful young plant which promised so much will wilt, and eventually die. Before extreme steps are taken honorable senators should give this measure the consideration it deserves. There have been a number of speeches in opposition to the bill nearly all of them couched in similar terms. Some honorable senators asserted that this proposal was in the nature of a wild-cat scheme, others suggested that it would be the means of substantially increasing the cost of sewing machines, and the price of wearing apparel.

Senator Guthrie:

– It will increase the price of sewing machines to the housewife.

Senator O’HALLORAN:

– I shall deal with that point, and show that the measure has much to commend it. I; shall use some of the arguments advanced by honorable senators opposite in opposition to the bill to show why we should pass it. We have been informed by some honorable senators that the price of imported sewing machines is- out of proportion to the cost of manufacture, and that Australian housewives are being exploited by the manufacturers or the distributors or by the combined actions of both. If that is so, it furnishes one of the strongest reasons why we should assist in establishing this industry in Australia, which will act as an Australian competitor, and a policeman, so to speak, between importing firms and their customers.

Some of the arguments advanced this morning were the result of too hasty a consideration of the Government’s proposals. It has been said that this legislation if enacted will increase the cost of sewing machines to the housewives by from £2 to £3 10s. - according to the country of origin of importations. It will not do anything of the kind. The customs duties of £2 British preferential, £3 intermediate, and £3 10s. general tariff, which honorable senators opposite said were to be brought into operation as a result of the passage of this measure, are deferred duties which are specifically postponed under the bill. The object of the Government is to obviate the necessity to bring these deferred customs duties into operation by fostering the industry in Australia. The Government proposes to allow the tariff to remain at from 10s. to 20s., and to provide a bounty of £2 per sewing machine head to enable the industry to be established. If after the industry is able to supply a substantial proportion of the Australian trade any increases are made in customs duties, the amount of bounty will, after inquiry by the Tariff Board, and as provided in clause 6. be reduced by an equivalent amountThat clearly and effectively disposes of the argument that the passage of this bill will result in increasing the cost of sewing machines to Australian housewives. Senator Payne referred to a circular letter which he and other honorable senators had received from the Metal Trades Employers’ Association of New South Wales urging them to support this measure.. The honorable senator quoted the price at which it was estimated sewing machine heads, stands, and cabinets could be produced in Australia, and arrived at the conclusion that the figure at which it was proposed to retail them was considerably higher than is warranted. The honorable senator, however, overlooked the fact that the importing firms are charging prices substantially higher than those quoted in the circular.

Senator Payne:

– That has no bearing on the matter.

Senator O’HALLORAN:

– It has.

Senator PAYNE:

– That is not a reason why an Australian company should exploit the public.

Senator O’HALLORAN:

– An Australian company cannot exploit the public under this bill. Clause 12 of the measure restricts the amount of profit to be made while the bounty is in operation to 10 per cent, of the capital invested. If the figures which the honorable senator quoted are correct it is1 obvious that considerably more than 10 per cent, profit would be made, and, therefore, no bounty would be payable under this bill. If the honorable senator’s statements are correct there is at present a good deal of exploitation by the manufacturers of sewing machines. The best way to prevent exploitation is to commence the manufacture of “machines in Australia, and thus provide healthy competition between manufacturers.

Senator Guthrie:

– Good sewing machines have been manufactured at. Bendigo.

Senator O’HALLORAN:

– That is stated in the Tariff Board’s report. ] know also from personal knowledge that machines of a highly satisfactory quality were once manufactured in Australia. Similar arguments have been used against the establishment of other industries. When bicycles were first imported into Australia we were told that they could never be manufactured here. 1 have npt traced the history of the industry, hut for many years push bicycles have been manufactured in Australia, and the assembling of parts is undertaken in practically every town of importance in the Commonwealth. A sewing machine is not in any sense complicated, or a product that requires a large and valuable plant to manufacture. In comparison with the work which it is capable of doing it is very simple in construction - Probably no other machine in general use which is capable of performing the intricate and delicate work entrusted to a sewing machine is of such simple construction. A sewing machine comprises comparatively few parts, and when, as sometimes happens, something goes wrong with it, and the machine has to be taken to pieces, it is usually not difficult to put it right again. On different occasions I have attempted to repair various classes of machinery, and at times I have found it difficult to re-assemble the parts. But that has never been my experience with a sewing machine. I have always been able to re-assemble it without difficulty, and to get it to perform further useful work. Just as it has been shown that Australia can make bicycles superior to imported machines, so Australia should now show the world that sewing machines can also be manufactured here. Indeed, that is not really necessary, for already satisfactory sewing machines have been manufactured at Bendigo.

Senator Payne:

– Then what is the need for a bounty?

Senator O’HALLORAN:

– It has been contended that the establishment of this industry would not provide any great amount of employment. I remind honorable senators that each year Australia imports sewing machines valued at about £330,000. That sum would provide employment for a considerable number of Australians, for the benefit would not be confined to the sewing-machine industry. Work would be provided for cabinetmakers, moulders, fitters and turners, engineers, machinists, and others. It is, indeed, remarkable how one class of employment can be built up on another group. The establishment of this industry and the employment in it of numbers of artisans would stimulate other industries, which would supply those workers and their families with their requirements, while money now sent abroad would be spent in Australia, to the advantage of the community generally. Surely that factor must weigh with honorable senators. Every step that we take to produce in this country articles which arc now imported must assist to adjust the unfavorable trade balance. We have been told that the fostering of certain industries has imposed heavy burdens on Australian consumers, and that this further attempt by the Government to establish another industry would penalize Australian housewives and add to the cost of wearing apparel in the manufacture of which sewing machines are used. When we reflect on the number of articles which can bc made by a sewing machine during its period of usefulness, it is drawing the long bow to say that the granting of this bounty will increase the cost of wearing apparel. Our experience in connexion with electricity meters should convince honorable senators that Australian firms, employing Australian workmen, can supply articles for les; than the price at which they were formerly obtainable from overseas manufacturers. Until about seven years ago. all meters for measuring the consumption of electricity were imported at a cost of approximately £2 5s. each. A firm of Australian manufacturers which proposed to make these meters approached Mr. Forbes Mackay, of the Electricity Department of the Sydney City Council, with a proposal that his department should buy 1,000 Australian meters at £3 each. Mr. Forbes Mackay realized that the proposal meant a loss of £750 to his department, but in order to give the new industry a start, he agreed to it. The Electricity Meter Manufacturing Company, better known as the E.M.M.C.O.. made the 1,000 meters ordered on behalf of the Sydney City Council. Those meters, which comprised over 300 parts, cost the manufacturer £4 10s. each. The company’s first efforts resulted in a loss of 15s. to the Sydney City Council and £1 10s. to the manufacturing company on each machine, but a start had been given to the industry, which has now become so firmly established that Australian-made electricity meters, guaranteed for three years, can be obtained for £1 Ss. Indeed, the Australian company is able to compete in England with the product of British factories. It quoted £1 10s. for electricity meters when British meters were selling in England at £1 12s. Honorable senators will see that, because of a little protection in its early stages, that industry has reduced the price of meters in Australia from £2 5s. to £1 8s. each - a reduction of 17s. - and is able to compete in the English market with British meters. That example shows what can be clone by Australian executives and artisans applying brains and hands to the development of an Australian industry. If the sewing machine industry in Australia is accorded the measure of assistance proposed by the Government, similar results may reasonably be expected.

Senator Sampson:

– There is no Australian sewing machine industry.

Senator O’HALLORAN:

-There was no electrical meter industry in Australia when the proposal to which I have referred was made to Mr. Forbes Mackay, but as the result of his action in granting a little assistance to a new industry, all consumer’s of electricityin Australia have benefited.

Senator Guthrie:

– Must Australian housewives pay more for their sewing machines iri order to establish this industry?

Senator O’HALLORAN:

– On two occasions already I have shown that the competitive influence pf this Australian industry will reduce the price of sewing machines to Australian housewives. Even Senator Payne admitted that the cost of Australian sewing machines will be not more than £17, whereas, according to the latest information in the possession of the Customs Department, the selling price of over 70 per cent. of sewing machines sold in Australia to-day ranges from £19 4s. for cash to £24 on terms.

Senator Payne:

– Nonsense !

Senator O’HALLORAN:

– I prefer to accept the figures supplied by the Customs Department rather than the statement of the honorable senator. After a careful examination, which took place early this year, the Customs Department supplied the Government with a report which bears out everything contained in the report of the Tariff Board. That information rendered it unnecessary to waste the time of the Tariff Board in another expensive inquiry. Senator McLachlan claimed that the costs of distribution of Australian-made machines would be tremendous. I can ‘see no reason why sewing machine heads could not be manufactured at parent factories situated at Bendigo, Sydney or some other convenient point, and distributed in bulk to assembling establishments organized at centres where the trade was sufficiently large to justify such a procedure. The cost of distribution of the parts in bulk would be small. There are very capable Cabinet-making and moulding factories at Brisbane, Perth, Adelaide, and Hobart, where the cabinets and stands could be made. The various parts of the machine could be assembled at small branches, and the complete article turned out at a very low distributing cost. That practice would not only overcome the difficulty mentioned by Senator McLachlan; it would give a stimulus to the moulding, cabinet-making, and timber industries of Australia, lead to further employment, and aid the prosperity of the country.

There are many other reasons why the bill should pass, but I do not propose to elaborate them except to say that the establishment of an industry such as this would lead to decentralization. Australia is suffering more from centralization than is any other country in the world. The last compendium of Australian statistics indicates the appalling fact that nearly half of our population is congregated in our capital cities. In the other countries of the world, the population is distributed fairly equitably over the country, thereby bringing about a more beneficial application of its brains and industry to the solution of its problems. This bill is calculated to afford some assistance to the establishment of an industry in a country town in Victoria, which would assist the decentralization movement. For that, and the other reasons that I have advanced, I commend the bill to the Senate, and hope that the second reading will be carried.

Senator DOOLEY:
New South Wales

– I trust that honorable senators will not accuse me of stone-walling this measure. I feel obliged to say something in support of the proposal of the Government to pay a bounty of £2 per head on sewing machines manufactured in Australia. The Tariff Board report of

December, 1925, recommended a somewhat similar bounty, which justifies the action of the Government in the matter. Apparently the principal fear of honorable senators opposite is that . the setting up of the industry in Australia would tend to increase rather than decrease the price of sewing machines. My experience is that when industries become established in Australia, whether assisted by the Government or otherwise, they bring about a cheapening of the price of the product concerned. I cite as an example the manufacture of gauge glasses for petrol bowsers. Prior to the establishment of the industry in Australia, those gauge glasses were sold at 36s. each. After the Waterloo Glass Blowing Company of New South Wales turned its attention to their manufacture, the price was reduced to 18s. I have wondered for years why sewing machines could not be manufactured and sold in this country at a lower price than that obtaining for the imported article. I understand that the best quality Singer sewing machine now costs £24 10s. That is quite unwarranted. When an industry endeavours to establish itself in this country in competition with large combines from abroad, its path is strewn with many difficulties; but I feel confident that, with the assistance proposed by the Government, the sewing machine industry will be able to carry on successfully in Australia. If it can manufacture and sell machines for £17 10s., thereby compelling competitive firms to reduce their prices, it will confer a considerable benefit on the housewives of Australia. For that reason alone I should feel obliged to give the measure all the support that I could. There are many other aspects of the matter that warrant the Government’s action. One of our greatest problems is unemployment. No one who has not had experience of what is taking place can realize properly how serious our position is. Yesterday, travelling between Sydney and Melbourne, I counted no fewer than 50 men carrying their swags.

Senator Sampson:

– Surely the honorable senator does not expect that many of those men would be employed in the manufacture of sewing machines.

Senator DOOLEY:

– This is only one of the many projects by means of which the Government proposes to solve the unemployment problem.

Senator Sir George Pearce:

– The Government expected to assist the unemployed by introducing its new tariff schedule last November. Instead, unemployment has increased, and continues to do so.

The PRESIDENT (Senator the Hon W Kingsmill:

– I remind honorable senators that we are debating the Sewing Machine Bounty Bill.

Senator DOOLEY:

– Perhaps the establishment of the industry will benefit even some of the poor unfortunates who are now carrying their swags. What is the use of importing sewing machines if the prices charged are too high to enable families to purchase them? It has been said that the establishment of this industry will be merely a drop in the ocean. I remind honorable senators that many drops make the ocean. By giving effect to different schemes such as this we shall gradually overcome many of our unemployment problems. According to the evidence submitted to the Tariff Board in 1925, the establishment of this industry in Australia would absorb at least 1,000 workers. It should be out endeavour to manufacture as much of our own raw material as possible. The Government has not gone to the full length recommended by the Tariff Board ; but has decided on a bounty of £2 per sewing machine head, and the people concerned appear to be satisfied. This morning I received a letter from the Chamber of Manufactures of New South Wales, part of which reads -

In connexion with the bill now under consideration, to provide for the payment of a bounty on the manufacture of sewing machine heads within Australia, ‘ I respectfully wish to advise yon that the Chamber of Manufactures of New South Wales is in favour of the proposal.

That does not influence me in any way; but it proves that this authoritative body favours the project of the Government, and believes that some good will come of it. The Senate would be wise if it agreed to the passing of the bill. No doubt a good argument may be advanced against fostering industries that are not able to hold their own ; but it is necessary to consider whether, if a little preliminary assistance is given to a new and struggling industry, it will eventually be able to establish itself.

Senator Sampson:

– This is not a struggling industry; it is dead. Why resurrect it?

Senator DOOLEY:

– Overseas competition was keen and the Government then in power was not sympathetic towards the Australian manufacturers. This Government’s policy is to protect Australian industries with a view to their development, and the introduction of this bill is in furtherance of that policy. I assume that persons interested in the Bendigo company approached, the Government for sympathetic treatment, and, as a result of the Government’s attitude, the company is being resurrected. Surely no one objects to any proposal to support Australian industries. I hope that the Senate will see the wisdom of giving this new industry at least the necessary protection as outlined in the bill.

Senator BARNES:
Assistant Minister · Victoria · ALP

– It appears to me that those honorable senators who have voiced their opposition to the bill are not at all keen about giving a helping hand to any Australian industry. It has been estimated that if the 45,000 sewing machines which are sold in Australia every year were produced locally, the industry would give employment to about 1,000 men. The Government believes that the bounty system, together with reasonable protection, is the best method for the development of the industry. I have no fear whatever that, if the bill is passed, it will be possible to get together an organization for the manufacture of sewing machines in Australia on a thoroughly satisfactory basis, and that the competition thus engendered will have the effect of bringing down the price of imported machines. I am informed that the landed cost of the most expensive sewing machine sold in Australia is only about £8 10s., so the margin of profit is considerable.

I am advised further that the manufacturing unit to make possible massproduction methods is capable of manufacturing about 10,000 machines a year, and that if the output were increased to 100,000 -machines a year the cost per machine would not be less than with a mass-production unit of 10,000. The Bendigo company failed previously because it attempted to establish a foothold in the Australian market on a freetrade basis, and it was unable to withstand the opposition of overseas firms manufacturing on a mass-production basis. The new Bendigo company, I understand, proposes to raise a capital of £100,000, and already has £30,000 in hand. The Sydney company anticipates being in a position to manufacture 10,000 machines by the 30th June, 1931. if this bounty is granted. Itseems to me that there is ample warrant for the assistance which this Government proposes to give to the industry. I hope that the Senate will pass the bill.

Question - That the bill be now read a second time - put. The Senate divided. (The President - Senator the Hon. W. King s mill. )

AYES: 6

NOES: 13

Majority . . 7

AYES

NOES

Question so resolvedin the negative.

Sitting suspended from4.51 to 8 p.m.

page 5248

INCOME TAX ASSESSMENT BILL

Second Reading

Senator DALY:
Vice-President of the Executive Council · South Australia · ALP

. -I move-

That the bill be now read a second time.

Honorable senators will note that the four main features of the bill are (1) taxation of income earned abroad; (2) correction of anomalies; (3) prevention of tax evasion, and (4) various consequential amendments. Although the measure is largely one for consideration in committee, there are certain features of it to which I desire to draw attention. The most important feature is represented by the provisions relating to the taxation of extra-Australian income. Clause 4a makes income tax payable by a resident of Australia on income derived by him from sources outside Australia. By clause 5c new paragraph q i, Commonwealth income tax will not apply to extra-Australian income already chargeable with income tax in any country outside Australia, or to such income derived from the sale outside Australia of produce of a country outside Australia which is subject in that country to a royalty on production or to an export duty on export. These provisions involve some consequential amend- ments in the definition clause of the principal act. For example, there is a new definition of “ absentee “ provided by clause 2a, and a new definition of “ resident “ provided by paragraph i of clause 2. There are other consequential amendments scattered throughout the bill to which it is not necessary to refer specially.

In connexion with the taxation of extra-Australian income, the bill deals specially with Australian shareholders in companies which derive such income. Hitherto Australian shareholders who have received dividends out of extraAustralian income derived by companies have been exempt from taxation on those dividends. Now they will be taxable upon so much of those dividends as comes out of the company’s extra-Australian income upon which the company is taxable in Australia under the altered provisions of the law. The bill preserves to the Australian shareholder exemption from tax on dividends received by him out of extra- Australian income derived by a company prior to 1st July, 1929. The new liability of the company and of the shareholder will apply to income derived by the company on and after 1st July, 1929. Examples are set out in the explanatory notes which have been distributed to honorable senators.

The bill also contains provisions for removing certain anomalies and for tightening up other provisions so as to prevent leakage of revenue which has been brought to light since the law was last amended in 1929. It will probably convenience honorable senators if I refer to some of these anomalies. One of them is connected with the averaging provisions, and is dealt with in clause 4 o. Under the existing law a person assessed under the averaging provisions may transfer assets which yield taxable income into assets which yield exempt income. He can then claim that his taxable income has been permanently reduced to an amount which is less than two-thirds his average taxable income, and that, therefore, he is entitled to commence a new averaging period, notwithstanding that he is still in enjoyment of income from the assets. This is unfair to the other body of taxpayers.

Another of the anomalies refers to rebates of tax through inclusion of dividends in shareholders’ assessments.

Clause 6 e deals with this matter. Frequently, where a shareholder’s rate is less than the company rate, he now receives a rebate of an amount of tax which exceeds the amount previously paid by the company on the dividend. The proposed amendment will fix the rebate in such cases at the proportion of the shareholder’s tax which is attributable to the dividends.

A third anomaly relates to co-operative societies. Clause S a incorporates a new concession to certain co-operative companies which have acquired assets from a Commonwealth or State Government, either by direct loan of funds from that Government, or by taking over assets created by it. For example, some sugar mills in Queensland have taken over assets created by the State Government, and are repaying that Government its expenditure. These companies are to receive exemption of so much of their profits as is paid to the Government, provided that shares representing at least 90 per cent, of the capital of the companies are held by cane suppliers to the company.

Another anomaly in regard to cooperative companies is that a number of them failed to comply with the definition of cooperative company in the act, which requires that companies seeking the benefits granted to co-operative companies shall specifically include in their rules a prohibition of the quotation of their shares on the stock exchange or in any other public manner. As they have failed to do this, they are now being given until 31st December, 1930, to remedy the defect in their rules.

Another class of company is also dealt with, namely, that which carries on both the distribution of goods among members and the distribution of goods supplied by members and sold on their behalf. Those companies cannot be treated as cooperative companies, because the terms of the law are not wide enough to cover them. Those terms are being widened, and their operation made retrospective in order to grant the benefits to one company which has been the chief sufferer in the past. This action will involve a refund to the company of about £2,500.

Lastly, there are co-operative building societies which raise money by subscriptions from members in order tr> lend i* to members to buy or erect homes, or homes and business premises combined. At present these societies are taxable on the full net income. It is proposed to allow a deduction of interest or dividends paid on the shares of members if 90 per cent, of the total loans are made to members.

Connected with co-operative societies is a provision in the principal act relating to rebates received by members of cooperative societies on their purchases from societies. This is in the definition of “income” in the principal act. It was never intended that a merchant, belonging to a merchant’s buying association, and carrying on the business of buying and selling goods for profit, should be allowed to escape income tax on that part of his profits which may be earned through the association, and which is represented by rebates received from it. A number of these associations have claimed to be co-operative societies. There is a vital difference between the two kinds of co-operative societies. In one case, the members purchase and consume goods; in the other, they obtain goods for re-sale at a profit. The amendment relating to this is contained in clause 2 d. The bill also contains special provisions for dealing! with private companies. These provisions are necessary to prevent loss of revenue. Cases exist in which several private companies have been formed by the same individual or individuals to hold different assets of those individuals. The person forming the companies holds all, or practically all, the shares in the companies. Each company is entitled to separate treatment under the act, and to retain one-third of its profits without liability to additional tax. There has been a considerable loss of revenue from this practice.

There is a widespread practice among some individuals carrying on business from which large profits are derived, and which are liable to high rates of tax, to form a company, the shareholders of which are members of the real owner’s own family. The company’s profits are distributed as directors’ fees between husband, wife and children, for the sole purpose of reducing the amount of income tax otherwise payable. Another form which the practice takes is that of a partnership carrying on business in their property, forming a company to “ huy “ the property. The partners accept shares in the company in satisfaction of the purchase price of the property, and then the partnership takes a lease of the property. Bent received by the company is taxable at the company rate, but, if retained in the partners’ own assessments, would be taxable at a higher rate. There is also a practice among privately-owned companies of refraining from distributing profits as dividends. Instead, they make “loans” of the profits to the principal shareholder or shareholders without interest, thus avoiding considerable taxation. In one case, when the company went into liquidation, the shareholders were forgoing their debts to the company.

There is a provision in clause 9 b relating to the application of section 21 to an Australian company whose shares are wholly or partly held by an. ex-Australian company. Where the Commissioner is unable to obtain a list of the shareholders of the ex-Australian company, the new provision authorizes him to assess the Australian company under section 21, on the assumption that the ex-Australian company is owned by one person. The, ex-Australian company can remedy matters by supplying a list of its shareholders, together with their respective interests in the company. Honorable senators will see that what on the face of it appears to be a hardship is really not so. Family partnerships are dealt with in clauses 12 d and 16. The relative sections of the principal act were amended in 1927 and 1928, hut loss of revenue through the formation of these partnerships still continues. The conference of deputy commissioners in 1929, strongly urged that the existing provisions relating to partnerships between husband and wife which were, in the opinion of the Commissioner, formed for the purpose of avoidance of tax, should be extended to partnerships formed between members of a family, and to private companies in which the whole, or a great proportion, of the shares were held by some, or all, of the members of the family. It is becoming a very common practice to form these partnerships and companies to reduce the amount of tax to be found by the persons concerned. The present husband and wife provision in the principal act has been accepted. Two or more husbands and their wives join together in one partnership. Many cases are not bona fide. One individual generally benefits and is the dominating factor in such schemes. Some husband and wife partnerships were recently abandoned owing to the amendments made in 1927 and 1928, and now the wife owns the business and employs her husband at a remuneration equal to his former interest in the partnership. Clause 12 d deals with this matter, and will check the practice mentioned. Exempt associations like the Chamber of Manufactures carrying on business of insurance through special, companies and rendering services to the insurance company for which remuneration is received, are not at present taxable on the remuneration. Clause 5 & of the bill will make them taxable. Clause 6 i deals with certain inequities arising from the sale of sheep in the wool, and paragraph j of that clause contains provisions affecting the assessment value of breeding sheep sold to put an end to a business. Clause 11 d will prevent double deductions in respect of depreciation of plant and machinery in cases where depreciation deductions have been allowed in past assessments and where plant or machinery is sold. Clause 11 e limits to residents of Australia deductions for contributions to pension and similar funds. Clause 11 e, f, I and m will very greatly reduce the work in all assessing offices. They relate to the method of arriving at net . income for purposes of special deductions.

The bill prevents double deductions for purchase price of pensions, calls on shares sold at a profit if the profit is taxable, and for the cost of wire and wire netting in fences erected on land by a person who purchased the land for re-sale at a profit. At present these persons are entitled to double deductions in respect of the cost prices of the items mentioned. Clause 11 h and i will limit the concessional deduction of contributions by employers to employees’ benefit funds to those contribu tions that are for the benefit of resident employees. Clause 11 h refers to an extension of the existing restrictions under section 23 Z n of the principal act with regard to deduction of an annual sinking fund to amortise the cost of structures, erected on leased property in order to preclude any freeholder through the formation of a private company securing a deduction in respect of structures erected on his own property by a company under a lease by him from the company. Clause 12 c re-states the present law in relation to a deduction of the annual sinking fund required to recoup a payment made for the assignment or transfer of a lease, and contains additional provision to meet transfers of goodwill or a license associated with a lease transferred or assigned. The exception stated in the last part of the proviso in this section is a corollary to the provisions of clause’ 6 / of the bill, which deals with the taxation as assessable income of amounts received upon the transfer or assignment of leases. I commend the bill to the Senate.

Debate (on motion by Senator Sir GEORGE Pearce) adjourned.

page 5251

COMMONWEALTH EMPLOYEES’ COMPENSATION BILL

Second Beading.

Senator DALY:
Vice-President of the Executive Council · South Australia · ALP

.- I move-

That the bill be now read a second time.

In the last Parliament the Senate dealt with a bill relating to compensation to Commonwealth employees, and it was transmitted to another place. Unfortunately, there was not sufficient time to pam the bill, and it was consequently shelved. In the main, the bill that is now before the Senate is similar to that introduced * by the Government’s predecessors in office. Certain extensions and enlargements of benefits have been made, and the justification for them can be gathered by a reference to the various schemes of workmen’s compensation in operation throughout the States of the Commonwealth.

This bill provides for comprehensive and up-to-date legislation in connexion with compensation for injuries received by Commonwealth employees. It should not be necessary for me to remind honorable senators that such employees are not entitled to participate in any benefits under the State workmen’s compensation acts, and it is necessary to introduce Commonwealth legislation to cover them. The principal act was passed in 1912, and the bill now before the Senate provides for its repeal and the introduction of new provisions. This Government found, as did its predecessors in office, that it would not be practicable to bring the Commonwealth scheme of workmen’s compensation up to date by amending existing legislation; that the better plan was to repeal the act and introduce an entirely new measure.

The bill contains many important variations from the present law, the chief among these being that the administration shall be in the hands of a commissioner. The necessity for that procedure was fully explained by the right honorable the Leader of the Opposition (Senator Pearce) when ho was leading the Government in this chamber. For the reasons that the right honorable senator then advanced I now ask the Senate to agree to that alteration of the existing Taw. The measure is to apply to all Commonwealth employees, irrespective of salary, but it excludes members of the naval, military and air forces. These are matters that we may well discuss in committee.

There is also an increase in the benefits that were proposed by the previous Government, and a vital alteration regarding specified payments for certain injuries. For many years, the amount of compensation payable in respect of a partial disability was left to an arbitrator, but one by one the States discovered that wit would be more satisfactory for both parties if a schedule were drawn up embodying the percentages payable in respect of certain injuries. The previous Government adopted that scheme in connexion with this bill, an example that is being followed by this Government. The only difference between the scheme of our predecessors in office and this one is that there has been an increase in the maximum amounts payable.

Under the principal act matters of compensation are decided by agreement, arbitration, or by the court. It was the practice, in the case of death, to refer matters of dependency to the court, thus causing delay and expense. Pro- vision, has accordingly been made in the bill that the act shall be administered by a commissioner, whose powers and functions are set out in clause 6. They provide that he shall determine all matters subject to the provisions of the bill. There is> however, a right of appeal from his decision to a county court.

The principal act applies to all civil employees of the Commonwealth, except those receiving more than £500 per annum. The bill abolishes the limit of £500, and will thus apply to all civil employees. The principal act also applies to naval and military forces except when on active service. As the various Defence regulations contain comprehensive provision for compensation in respect of injuries to members of the forces, it is proposed that the bill shall not apply to them.

Provision is made in the bill for the extension of the act to employees of such authorities established under the Commonwealth as are prescribed by regulation. It can thus be made applicable to such an authority as the Commonwealth Bank, and the authority will, unless otherwise prescribed, be responsible for the payment of compensation in accordance with the provisions of the act.

Under the principal act, in cases of death the compensation to dependants, wholly dependent, is a sum equal to three years’ earnings, subject to a minimum of £200, and a maximum of £500. The bill provides for more liberal payment. The amount of compensation will be a sum equal to one hundred and fifty-sis times the weekly pay at the time of injury, subject to a minimum of £400. and a maximum of £750.

In cases of total or partial incapacity, the principal act provides for a weekly payment not exceeding 50 per cent, of average weekly earnings, and subject to a maximum of £2. The bill provides for payment not exceeding two-thirds of weekly pay at time of injury, and the maximum is increased to £3 10s. In addition, child endowment at the rate of 7s. 6d. for each child up to 16 years of age is to be paid during total incapacity.

Provision has also been made for increased payments to employees under 21 years of age, and if their cases are reviewed after reaching 21 years they may receive up to two-third* of their probable earnings, subject to a maximum of £3. Thi3 is a substantial extension, as the maximum under the present act is £1 per week.

The principal act does not prescribe payments for specific injuries, and the absence of this .provision makes it necessary to arrive at an agreement in each instance or go to the court. Modern compensation laws, including State acts, contain a schedule of fixed payments for specific injuries. The . bill accordingly contains a schedule in keeping with modern requirements. In. this schedule the payments vary from £675 downwards according to the nature of the injury. The principal act contains no provision for the payment of medical benefits to injured employees. The trend of modern legislation is to provide for such benefits. Provision has accordingly been made in the bill for payment of medical, surgical, and hospital treatment up to £100. This payment is in addition to compensation otherwise provided in the bill. I think that honorable senators will appreciate the justness of that provision. In the capital cities there arc public hospitals to which an employee can go in the event of his meeting with an accident, but the same does not apply in the country. Consequently a country member of the Public Service receives an amount of compensation which in reality is less than that received by his fellow employees in the metropolitan area.

Senator Sir George Pearce:

– Can the employee who goes into a hospital also draw that £100?

Senator DALY:

– That is a matter that can be well considered in committee: ‘ The employees are not making any unreasonable demands. This particular provision was inserted to meet the case where an employee is called upon to pay such expenses, not where he can avoid them by going into a public hospital.

Senator Sir GEORGE Pearce:

– Is that provided in the schedule?

Senator DALY:

– Yes. The bill enacts that the liability of the Commonwealth shall be limited to £750 plus medical expenses, except in the case of permanent total incapacity. It is felt that this limit should not apply in the case of an employee who has received injuries which render him totally incapable of doing any further work. The Government considers that the best way to assist such an employee is by a permanent weekly payment, instead of lump sum compensation. The hill accordingly, provides for a weekly payment of twothirds of his pay, subject to a maximum of £3 10s. without any limitation as’ to the period and total liability.

When the previous bill was. under consideration in the last Parliament, a discussion took place in the Senate on the question of industrial diseases, for which no provision had been made.” As a result of that debate, honorable senators were assured that the matter would bc investigated by the Health Department and that, if necessary, an amendment would be made in another place. The whole question has since been examined by the Health Department and the bill now contains provisions for the payment of compensation to employees contracting certain industrial diseases as well as comprehensive provisions for compensation to all civil employees of the Commonwealth in respect of personal injuries by accident or. industrial diseases. These arrangements are in keeping with the trend of modern legislation and are on a much more liberal scale than those .in the present act. In only one other respect has there been a departure from the system in operation in the States. That relates to the assessment of loss of earning capacity. If a man suffers an injury to one of his hands, the injured hand considered as a member of his body, may represent a loss of only 20 per cent, efficiency for ordinary purposes ; but as a working hand the injury may represent 100 per cent incapacity. It may still bc possible for a man with an injured hand to pick up a knife or other small article, but quite impossible for him to use a shovel or hammer, or any other implements of trade to which he has been accustomed. Again, if a man loses a leg, the injury should be considered from the point of view of loss of earning capacity. If he happens to be a carpenter, the loss of a leg will represent 100 per cent, incapacity, because he will be unable to throw his full weight upon an arti ficial leg and unable to climb a scaffolding or* do many other acts which ordinarily would be performed by him in the coarse of his work. Consequently, the Government suggests that in assessing compensation for inquiries, the loss of earning capacity should be the determining factor.

Senator DUNCAN:
NEW SOUTH WALES · NAT

– What is the estimated increased cost to the Commonwealth if this proposal is accepted?

Senator DALY:

– It would be possible for me to obtain an actuarial estimate, based on the view which an insurance company would take of the extra benefits, from the point of view of premiums payable. At present, the Public Service Arbitrator has authority to determine payments in the case of accidents. But for the existence in the act of this provision, it is probable that there would have been a strong agitation to bring the act up. to date. I assume that the previous Administration felt that, instead of allowing the Public Service Arbitrator to determine these matters, a commission should be appointed so as to ensure uniformity in the Public Service.

Senator McLachlan:

– The assessment of compensation is really foreign to the work of the Public Service Arbitrator.

Senator DALY:

– That is so; it is’ difficult to. obtain an accurate estimate of the increased cost to the Commonwealth of the adoption of this scheme, because already a large section of Commonwealth employees is in receipt of benefits equivalent to those which will be conferred upon public servants generally under this bill.

Senator McLachlan:

– In any case an estimate could only be computed fi om happenings of the past.

Senator DALY:

– Yes. To arrive at an estimate we should be obliged to study the various awards’ that have bren made to see what benefits have been conferred upon certain employees in respect of injuries received.

Senator H E ELLIOTT:
VICTORIA · NAT

– Is it intended to deprive the Public Service Arbitrator of authority to assess compensation in future?

Senator DALY:

– There is a provision to that effect in the bill, but when it is in committee an honorable senator supporting the Government intends to ask honorable senators to reject the particular clause relating to that matter.

Debate (on ‘ motion by Senator Sir George Pearce) .adjourned.

page 5254

HOUR OE MEETING

Motion (by Senator Daly) agreed to -

That the Senate, at its rising, adjourn till 11 a.m. to-morrow.

Senate adjourned at 8.39 p.m.

Cite as: Australia, Senate, Debates, 5 August 1930, viewed 22 October 2017, <http://historichansard.net/senate/1930/19300805_senate_12_126/>.

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