12th Parliament · 1st Session
The President (Senator the Hon. W. Kingsmill) took the chair at 3 p.m., and read prayers.
– It is.
Gardeners and Gardeners’ Assistants
asked the Minister representing the Minister for Home Affairs, upon notice -
– The answers to the honorable senator’s questions are as follow : -
asked the Minis ter representing the Minister for Trade and Customs, upon notice -
– The information is being obtained.
Use of Duntroon Area
asked the Minister representing the Prime Minister, upon notice -
Will the Government instruct the Parliamentary Public Accounts Committee to inquire into the advisability of converting the now vacant Duntroon military area into a Commonwealth aeroplane factory and testing ground at the earliest possible date?
– It is not considered that any good purpose would be served by such an inquiry, as funds could not be made available for the establishment of an aeroplane factory and testing ground.
Shipping Service: ProposedWork at Cockatoo Island Dockyard - Telephonic Communication.
– The answers to the right honorable senator’s questions are as follow: -
asked the Minister representing the PostmasterGeneral, upon notice -
Have the Government abandoned the proposal to establish telephonic communication between the State of Tasmania and the mainland; if not, when is it proposed to carry out the work?
– The proposal to establish telephone communication between the State of Tasmania and the mainland has not been abandoned and, subject to Parliament approving of the recommendation of the Public Works Committee, the work will be proceeded with as early as the financial position permits. The department realizes the importance of the service and is anxious that it should be established as early as practicable.
Empire Quota Proposal,
asked the Minister representing the Prime Minister, upon notice -
– The Government is not in possession of any information indicating that a decision of the nature mentioned has been reached by the British Government.
The following paper was presented: -
Audit Act - Transfers of amounts approved by the Governor-General in Council -
Financial Year 1930-31- Dated 18 th November, 1931.
In committee: Consideration resumed from the 20th November (vide page 1828).
By omitting the whole item and inserting in its stead the following item: - “ 8. Perfumed spirits, per gallon - British, 50s.; intermediate, 55s.; general, 60s.,and ad val. - British, 30 per cent.; intermediate, 35 per cent.; general, 40 per cent.”
Upon which Senator McLachlan had moved by way of request -
That the House of Representatives be requested to make the duties - British, 45s.: intermediate, 50s.; general, 55s.
Senator Sir GEORGE PEARCE (Western Australia) [3.10]. - I desire briefly to give my reasons for supporting the request of Senator McLachlan. In considering the tariff, I suggest that we should have regard to trade with countries with which we have a favorable trade balance. On Friday last, figures were given showing that our chief imports of perfumes are from France. We know that the perfume industry is essentially a French industry. The imports of perfume for 1930-31 were worth only £10,000, and it has been suggested that that means little or nothing to France. But it is the multiplication of these small items that makes up the total trade, and we export to France about three times as much as we buy from it. Yet, we are now putting an almost prohibitive duty on one of the commodities which France exports. We have had complaints in Australia about the retaliatory duties imposed by France on some of our primary products, yet how can we so complain in the light of these prohibitive duties upon the products of France ? What does the local industry mean to Australia ? I suggest that it does not mean much. I urge the Senate to support the request. If it is agreed to, there will still be a heavy duty upon the imported article, which will bear both a specific and an ad valorem duty, not an alternative duty. I suggest that we should regard this as one of the duties which penalizes countries which buy from us more than we buy from them. There are throughout the schedule not many items which permit us to have regard to the principle of reciprocal trading. This reduction of duty would not do us any harm, and would be a friendly gesture to France.
– I hope that the committee will not accept the request of Senator McLachlan for a reduction of duty under this item. Senator Pearce has said that the perfume industry is essentially a French industry; but his argument would apply to a number ‘of the industries of the countries with which Australia is trading. We have discovered that we can manufacture perfume in Australia, and that it is not wise to buy abroad goods that can be produced here. It has been said that this is only a small item, but the Government has been, and still is, confronted with a’ severe decline of the national income, and a consequent diminution of moneys abroad with which to meet our interest commitments and to pay for necessary imports to Australia. We cannot afford to pay France £10,000 a year for perfume, particularly when that expenditure may mean default to some extent to bondholders in London. The tariff schedule contains certain items respecting which there is good ground for differences of opinion between honorable senators; but this is a commodity which, if we did not manufacture it, we can well do without. We should exchange our primary products for goods which we cannot afford to use. Every man ‘ in the community has, because of the financial depression, had to economize in suits, hats, sox, shirts, collars and so on. and the women of Australia have had to use less perfume. The Government has, in its endeavour to rectify the trade balance, imposed this duty.
– But the balance of trade with France is in our favour.
– Thanks to the present Government.
– It has been so for years.
– If the Leader of the Opposition were at some future time to lead the Senate, with a Nationalist Government in power, we should soon have an unfavorable trade balance, and Australia would again become a nation of importers, a nation that could not produce anything or do anything, a nation that, as I have pointed out on many occasions, could not produce even sufficient vege tables for its own use. Honorable senators opposite, who belong to a party which professes to believe that the salvation of the primary producer lies in the conservation of- our financial resources, are urging this Government to make it easier for a foreign country to import into this country perfumes in exchange for our wheat and wool. If wo cannot afford to use perfumes, it is not legitimate trade for us to import them. Surely honorable senators recognize that our internal trade depends upon what the community can afford to buy. Why should we import perfumes which we cannot afford?
– We can pay for them with wheat.
– It would be infinitely better to use our wheat and wool in meeting our interest bill abroad. The sooner we conserve our resources with a view to meeting our overseas obligations, the sooner shall we reach the goal of prosperity. Why should we send our wheat and wool abroad and take in exchange olive oil and perfumes? Senator McLachlan would not advocate sending our wheat and wool abroad in exchange for foreign wine, because that would interfere with the sale of South Australian wine. This is said to be a great national parliament, with nothing parochial about it, yet South Australian representatives would nol care what duty was imposed so long as it prevented French wine from coming into competition with that produced in South Australia. But there are those who would allow French perfume to bo imported, while claiming that they are not freetraders and rendering lip loyalty to the policy of protection. It would be interesting to observe their attitude towards an item that affected Queensland sugar, bananas, or peanuts, South Australian wine, or Victorian woollen blankets. Not one word of protest was uttered when Australia was importing annually from France £780,000 worth of silk goods which came into competition with Australian woollen goods. We are now asked to make a friendly gesture by permitting the importation of £10,000 worth of French perfume, thus pulling France’s leg as we would be pulling our own. If honorable senators believe that we should extend our trading activities with France, let them be honest and say that her artificial silk goods shall be permitted to compete with our woollen goods.
– That is the silliest statement that I have heard.
– I can afford to ignore that interjection. Any man who says that prohibition can be brought about by cheapening the price of beer, is capable of saying anything. The time has arrived for us to decide whether the basis of trade between this and other countries shall be altered, and whether wc favour the policy of the present Government, which to-day, apparently, is influencing the attitude of the British Parliament. Why should we tinker with small items of this description? I hope that honorable senators will not insult France by making such a gesture, but that they will allow the industry which has grown up here as a result of the protection afforded, to flourish, so that when our women resume the normal consumption of perfume, we shall be able to show that in this direction, at any rate, we are self-supporting.
– What is the size of the industry?
– I have not the figures, but it has grown considerably. Honorable senators must realize that, because of its nature, it has brought about its own rationing, perfume being something that can be done without. The proposal of the Leader of the Opposition (Senator Pearce) is that, although we cannot afford to use perfume, we should convince France that we have not dispensed with it, and that we should .pay her for our supplies with our wheat and wool. Perfume that is brought ,to Australia must be sold ; otherwise, of what value is it when exchanged for our wool and wheat? We have had to sell the wireless sets, pianolas, motor cars and other commodities that we have imported in the past, and have found ourselves in the position of a householder with a fully furnished sitting-room but not a kettle in the kitchen. If the farmer is to be paid, some of these luxuries must be cut out. By producing the perfume, >in our own country, the difficulties associated with external commerce are avoided. I hope that the committee will reject the request.
.- After the beautiful, if somewhat ineffective, flight of fancy in which the honorable gentleman who is in charge of the tariff has indulged, it might be as well to consider a few facts. I should like to know whether the Tariff Board has made a report in connexion with this matter.
– It has not.
– Then that is one reason why we should not agree to the duty. It has been imposed on the people of Australia without the authority of Parliament, and without the observance < by the Government of the statutory requirement of reference to the Tariff Board.
– And without even a protest from the Housewives Association.
– Probably that is so; they are now used to anything. Instead of ridiculing this proposition, the honorable gentleman might have given us some idea of what has happened during the two years that the duty has been imposed.
– I did that on a previous occasion.
– Had there been a report by the Tariff Board, the honorable gentleman probably wouldhave been in a position to give us some information. He is inclined to regard as of no account this statutory requirement. I am unable to share his opinion. No explanation has been given to us, and I do not believe that any can be made. Seeing that the legislation under which the Tariff Board caine into existence has been flouted, the Government should show the respect that is due to this chamber by giving some explanation of its action, and not merely allude to it as though it were of no account. It is not sufficient to say “ We have transgressed the law in other ways, why bother about this?” .It is time that the Senate took the perfectly legitimate objection to 75 per cent, of the items in the tariff that they were not referred to the Tariff Board for report. On this item I am prepared to restore the tariff that was in operation before the alteration two years ago. That should afford sufficient protection for any manufacturer of perfumes in Australia. I am not aware that any Australian manufacturer has made a great song about this. Some of them carry on in Western Australia, and any objection by them must have reached the ears of senators from that State.
– I have a letter from one of the biggest manufacturers in Australia -F. H.Faulding and Company, Adelaide - objecting to the reduction.
– I do not think that they manufacture extensively; they purchase a lot of their perfume from other manufacturers.
– They are large manufacturers.
– Even if they are, my argument is not affected. This is protection run mad, and the endeavour is being made illegally to place it on the statute-book. It is protection that has been enforced without legal warrant for two years. On those grounds, if for nothing else, I consider that I am amply justified in supporting the proposed reduction.
.- I had hoped that the Minister in charge of the bill would offer some justification for this increase. I have little to add to what those who have preceded me have said, except to emphasize what I consider to be the most important point of all, that the Government has placed this additional impost upon the users of perfume in Australia without any request from our manufacturers, and without any reference to the Tariff Board, which is a flagrant violation of the law.
The Minister’s speech was an extraordinary one. When he first spoke on this subject last week, he claimed that our revenue was declining to such an extent that it was imperative that we should obtain more.
– I said nothing about revenue. The honorable senator does not know the difference between revenue and national income.
– The Minister is correct in saying that he did not mention revenue in this matter.
– As my honorable friend supports the contention of the Minister, I must accept his assurance. In support of his request that these high duties should not be altered, the Minister intimated that he desired the Government to exclude from entry into Australia all perfumes coming from France. To be consistent, the honorable senator should arrange for the prohibition of all importations to Australia, except those that are indispensable to the needs of the people. What kind of a country would we then have? The suggestion of the Minister that we should ignore the trade potentialities ofFrance or any other country-
– I said nothing of the sort.
– I did not want to use the unparliamentary phrase that is so often uttered by the Minister that we are “pulling the leg” of France. That expression is unworthy of the honorable senator. Statistics prove that we in Australia could not survive as a self-contained nation. The- Minister declares that those who urge that these duties should revert to the 1921-28 level, are rabid freetraders. In 1928 this item carried a duty against France of 50s. per gallon, or 30 per cent. ad valorem. Can that be termed a freetrade tariff? The Government proposes to increase those rates to 60s. per gallon, or 40 per cent. ad valorem, an enormous addition, without any definite request having been made by those engaged in Australia in the manufacture of spirits. We pride ourselves upon being a cosmopolitan people, and on having tastes conformable with those of the people of other parts of the British Empire. If our womenfolk express a desire to use a certain brand of French perfume, which they can afford to buy, who is bold enough to dare say that we should thwart their desires?
– This tariff enables those who can afford to buy such perfume to do so. It is not a prohibition.
– The Minister expressed a desire to prevent the importation of anything that comes from France. He is an absolute prohibitionist. I support the Leader of the Opposition in his effort to reduce this item to the rates that existed under the 1921-28 schedule.
.- I trust that the Senate will not agree to the proposal that emanated from Senator McLachlan, and is supported by Senator Pearce and others, to reduce the item. The principal argument of the Leader of the Opposition in the Senate in support of. the proposed request for a reduction is that such a reduction would constitute a friendly gesture to Prance, and ensure the sympathy of that great nation when it purchases commodities that it does not produce. I do not think that any one could argue strongly against the principle enunciated by Senator Pearce, if it were based upon a really secure foundation. But the right honorable senator would have us believe that if we bought more perfume from Prance, that country in turn would purchase more wheat from us. The Minister in charge of the bill advanced very sound arguments in rebuttal of that contention. The position of a nation is similar to that of an individual. If. an individual has a credit balance with another person, but in the aggregate his business transactions show a debit balance, he will soon reach the insolvency court. That was the position in which Australia found itself when this Government assumed office, and the introduction of the tariff schedule has been largely responsible for changing an adverse into a favorable trade balance.
– Australia had a favorable trade balance with France at that time.
– A favorable trade balance as between one nation and another, does not demonstrate solvency, there must be an aggregate favorable trade balance. It is perfectly true that we have at all times had a credit balance in our dealings with France, while at the same time our trade balance with the majority of’ other countries has been adverse. The Leader of the Opposition (Senator Pearce) appealed to the committee to adopt the amendment because it relates to only one small item; but the multiplicity of small imports helped to create the adverse trade balance. The tendency of the committee seems to be to request the House ofRepresentatives to reduce the duty on each item; if such reductions are made Australia will again find itself in an unfavorable trade position. In 1923-24 the importations of bay rum and perfumed spirits were: from the United Kingdom, £28,529 ; from
France, £32,080; from Germany, £7,060; from United States of America, £4,995; and from other countries, £1,022; a total of £73,686. By 1928-29 the total had advanced to £106,680, but the benefit of the increase went, not to France, but to Germany, the importations from the latter having risen to £28,950. The other importations were: from the United Kingdom, £30,033 ; from France, £45,172 ; from the United States of America, £2,059; and from other countries, £466. Since 1928-29, there has been -a further reduction of imports, and the totals for 1930-31 were: from France, £10,647; United Kingdom, £7,497; Germany, £5,267; other countries, £353; total £23,764. It must be obvious to the committee that if it agrees to the proposed reduction the benefit will go principally to Germany. Looking at the other side of the trading account, we find that in 1927-28, before the allegedly prohibitive duties were imposed, France bought £180,351 worth of Australian wheat. Our importations of perfumed spirits in that year amounted to £41,161. In 1928-29, when our importations of perfumes, &c. were £45,172, France’s purchase of Australian wheat totalled £480,441. In 1929-30, during the greater portion of which the increased duties were operating, we imported £34,967 worth of perfumes and France bought only £51,338 worth of wheat.
– That was because of retaliation against the Australian tariff?
– No ; France for years has been endeavouring to foster its agricultural industry, and importations of wheat in 1928-29 were heavy because of the failure of the French crops. In imposing a duty on wheat, France is not retaliating against the Australian tariff, but is merely endeavouring to protect her own primary producers. If we bear in mind these facts we shall be better qualified to give unbiased consideration to the tariff items, and reach decisions which will be helpful to our industries and the trade balance. I shall oppose the request.
– This discussion, and particularly the remarks of the last speaker, illustrate the need for having all proposed duties examined by the Tariff Board before they are submitted to Parliament. The Board has not reported on this item, and we have no explanation why the old duties of 40s., 45s., and 50s., plus ad valorem duties of 20 per cent., 25 per cent., and 30 per cent., have been increased in this schedule. Senator O’Halloran quoted statistics which blended perfumed spirits with bay rum and other commodities, until honorable senators are a little confused as to the facts.” I have received from F. H. Faulding and Company, manufacturing chemists and perfumers of Sydney, a letter which, after referring to the request I have moved for the reduction of this item, continues -
We feel that in making this move you may not fully realize the effect that a reduction of duty on perfumed spirits will have upon the excise revenue and Australian manufacturers. Our firm, like many others, have built up a business in the perfume trade under this protection-
Which protection ? Under the former tariff schedule, this firm was manufacturing extensively boronia, wattle and other perfumes which can be produced nowhere else in the world. The letter goes on to say - and we ourselves pay excise duty amounting to many thousands of pounds in a year.
Foreign manufacturers built up their trade in Australia under duties somewhat similar to those which you now propose to reduce,
The obvious deduction is that Faulding and Company are under the impression that we are proposing a reduction of the duties upon which that firm built up its present trade- and it is only during the last twelve months that such firms have found it impossible to do further trade in Australia, due to the exchange.’ They Iia ve consequently, in some cases, opened factories in Australia. Such firms would also like to feel that their actions and confidence, in Australia are supported by Parliament.
We would point out that all packages and bottles and other containers which Australian manufacturers have to import, pay a duty of 00 per cent, or over, so that a duty of 25 per cent, on the packed articles would not in any way offset the disadvantages that Australian manufacturers have in this regard.
Upon receipt of this communication I telegraphed to Faulding and Company in order that I might be fortified with information, when the Senate met to-day, of the rates upon these items in the tariff upon which they were now required to pay an increase of 60 per.cent. This item is another illustration of the complaint made by a number of honorable senators when speaking to the second-reading debate, that these excessively high duties threatened to ruin some of our secondary industries. Faulding and Company continue -
The duty you propose for the gallon rate is only approximately the same as Australian manufacturers have to pay as excise rates on spirits for high-class perfume manufactures.
We would ask you to particularly give this matter further consideration before pressing for this reduction of duty, and we shall be pleased to put the full facts before you, if you so desire.
As has been stated already, the trade with which such firms are associated is extraordinarily difficult, and for this reason, if for no other, the Tariff Board should have been deputed to make, a recommendation as to the new rates of duty.
– The Tariff Board has not been idle.
– Apparently, the Government has been too busy for the Tariff Board, because it has imposed duties without reference to the board, and without giving consideration to their probable effect. It may be urged that France, like so many other countries, is endeavouring to make herself selfcontained. For this reason it is difficult to get decent tobacco in France, or readily secure that commodity of which my forebears were supposed to be so fond; but the people are encouraged to consume French wines and brandies. In 1928-29 our imports from France totalled in value, about £3,700,000, the principal items being apparel, textiles and manufactured fibres, £2,144,000 ; perfumery, drugs and chemicals, £327,000. In that year we exported to France commodities Valued at £15,000,000, the principal items being wool, £12,000,000; hides and skins, £2,400,000, and wheat, £480,000. These figures do not suggest an adverse trade balance for Australia. I do not know what is going to happen if, because of our tariff alterations, French firms like Coty’s have to send their representatives to Australia to investigate the trade position. The extraction of perfumes is one of the most intricate processes known to chemistry.
– Ithas been proved that Australian spirit is suitable for the purpose.
– If it is, I have no doubt that the manufacturing chemists are using it. This highlytechnical business cannot be established in a year or two. The duties imposed by the Government are so high that I marvel at my own modesty in not moving for a greater reduction. The duties were, British, 40s. per gallon, and ad valorem 20 per cent.; intermediate, 45s., and ad valorem 25 per cent.; general, 50s. and ad valorem 20 per cent. The Government has increased the per gallon rate by 25 per cent. The proposal is a duty of 50s. British, and an ad valorem rate of 30 per cent. These I propose to reduce. I am aware that the importations are trifling, probably amounting to not more than £10,000 or £15,000 a year; but these arc the kind of duties which make France feel sore. If we take the right step, wo may alleviate the position somewhat, but I can assure honorable senators that it is becoming more acute every day. Eventually France may block the importation of every possible commodity it can afford to do without. According to this morning’s newspapers, the British Government has decided that, if France closes its ports to British goods, Britain will retaliate by prohibiting the importation of French wines. How much longer is this international wrangling to go on. to the undoing of civilization? It is a matter which has been discussed on numerous occasions by the Assembly of the League of Nations and by other international gatherings. If every nation is to endeavour to be self-contained, the result can only be failure. Realizing that the Commonwealth Government needs revenue, I have not gone in my proposal so far as other honorable senators would go. My proposal is simply to reduce the fixed rate of duty by 5s., and the ad valorem rate by 5 per cent. It is a moderate request.
– The honorable senator’s time has expired.
– I join with other honorable senators in protesting against the action of the Government in submitting fresh duties without first having referred them to the Tariff Board for consideration and report. Whatever justification may have existed at the time for the drastic action the Government found it necessary to take to correct the adverse ‘ trade balance, there has since been ample opportunity to refer all these matters to the Tariff Board so that the information which honorable Senators need in the discussion of a tariff schedule might be available to them. I feel bound to say, however, that, at the present time, there is every justification for the imposition of prohibitive duties on a commodity such as perfumed spirits. We are all aware that there are well-to-do people who, in any circumstances, will import high class tweeds, hats, cigars, tobaccos, spirits and perfumes, and pay high prices for them; but these are all luxury items and can legitimately be regarded as objects for taxation in order to provide revenue in a time of financial stress.
– The importations of France is a striking example of the nature of the trading which one country should do with other countries. France does not import wine from Australia; it is content with producing its own wine. It imports Australian wheat merely for the purpose of blending with its own wheat. The general tariff on wheat in France is 3s. 6d. a bushel. As a matter of fact France ranks fifth on the list-of producing countries, and except in a few abnormal years, when the local production is low, Australian wheat has never largely entered into French commerce. It may be of interest to honorable senators to knowthat in 1928 France, which is a substantial exporter of butter, ranked eleventh on the list of exporting countries, and that that country ‘exports 25,000,000 lb. of that commodity annually. General Pau, a member of the French Mission, which visited Australia in 1918, said-
Australia will understand that a great agricultural nation such as France, which is an exporter of agricultural products, must in this particular provide a reasonable measure of protection for herself. But we shall not be able to forget that our comrades in arms throughout the Great War have a right to special consideration, and we shall be glad to admittheir products in large quantities, not alone including those which hitherto have been free of duty, but also those on which formerly our maximum rates were imposed.
France purchases from Australia only what she needs, and we should purchase from France, or from any other country, what we cannot produce. Senator Herbert Hays, who is opposed to the Government’s general fiscal policy, said that we cannot afford to allow the proceeds of our wheat and wool to be utilized to pay for perfume and other such commodities manufactured in France, and at the same time, prevent holders of Commonwealth bonds in Great Britain from receiving their full amount of interest.
– The duties proposed under this sub-item should be seriously considered. The action taken by the French Government cannot be disregarded. We must conserve our interests. France has been a better customer to Australia than Australia has been to France. The penal duty imposed on Australian wheat gives us an indication of the direction in which we should act in matters of ‘this kind. France has imposed a special duty on Australian wheat, while Canadian wheat is being imported on much easier terms. I do not know whether Senator McLachlan quoted the figures in full; but it appears from the official records that for the last five years our purchases from France have decreased to the extent of £750,000, while France’s purchases from us have dropped to the extent of £8,000,000. For every £1 which we have refused to send France, that country has declined to send us over £10. That is a clear indication of the international irritation that has been aroused as the result of the imposition of excessive duties. We cannot ignore the unfriendly fiscal attitude which has arisen with respect to the United States of America, which has deliberately erected such a high tariff wall against us, that we feel we have a fiscal grievance against that country. If that is so, we cannot blame France for following in our footsteps.
– Does the honorable senator think that the difficulties can be overcome by reducing the duties on perfume?
– This is only a small matter ; but, in the aggregate, minor matters may become of some importance. We have to consider whether we are not increasing the duties to a point at which Australian manufacturers will not feel the effect of foreign competition.
– If Coty’s commenced manufacturing here, the Australian manufacturers would not have a chance.
– No. We are dealing with a nation which in the past has been a splendid customer of Australia, but which may become so indifferent, or so openly hostile, that she will purchase from Australia only those commodities which she cannot do without. This schedule is bristling with items of this character. We should endeavour to place our local manufacturers on a fair basis, and allow them to be fairly handicapped. If racehorses are not properly handicapped, very little interest is taken in the race; but if the contest is likely to be keen, interest is immediately aroused. There is no competition at all in a contest of this nature. Many of the duties in this schedule are so high that competition from overseas is impossible. . High duties engender in the minds of foreign manufacturers a feeling of resentment against Australia, which is very effectively expressed by their unwillingness to trade with us. Our overseas trade will be in anything but’ a healthy condition if we endeavour to isolate ourselves by prohibiting importations. We cannot blame any one else if we use this weapon unreasonably. We may, if we choose, continue to raise the tariff wall; but what will be the result? The sum of £10,00.0 spent annually in the purchase of perfumes is so small that we should not b.other about it.
– We cannot afford to pay that sum for perfumes from other countries.
– It is well known that France has taken retaliatory action against Australia.
– It is useless to shut our eyes to facts. We have evidence of that retaliatory action in the special duty of 7s. 6d. per bushel which France has imposed on Australian wheat. In order to pay pur overseas commitments for interest we must export our products: but bow can we do so if we antagonize our customers? France has not put a high duty on Australian wheat for nothing. The Minister referred to the visit of General Pau to Australia some years ago. We must have regard to the general feeling throughout France towards Australia rather than to what was said by a visitor who was our guest. The attitude of the people of France towards us is revealed in this special duty on Australian wheat. Instead of provoking other nations to retaliatory action, we should adopt a policy of live and let live. By its fiscal policy the Government is antagonizing other nations. I have supported the Government when I have felt that is has acted in the best interests of Australia; but, on this occasion, I feel that it is not doing so, and, therefore, I shall vote against its “proposals.
– I fail to understand why any reduction in this duty has been proposed, unless it has been in compliance with a policy of taking a shaving, or a slab, off every duty in the schedule. Other than that it might antagonize .a country from which we have imported considerable quantities of perfume each year, no valid reason has been advanced for reducing this duty. It cannot be argued that any one will suffer a real hardship if this duty remains. On the contrary, Australia should benefit, .because the overseas firms affected may be induced to establish manufactories in Australia, thereby giving employment to Australian workers.
– That has been the effect of the British duties.
– That is so. In yesterday’s’ newspapers there appeared a cabled report that the French firm of Coty proposes to establish a factory in England for the manufacture of perfumes. That is a direct result of the British duties. In a matter of this kind we may well follow the example of Britain.
– Would the honorable senator accept the British duty?
– No. I, for one, am anxious to maintain Australian industrial conditions, which are entirely different from those of Britain. I do not believe that a reduction of wages, and a lowering of the standard of living, will prove a panacea for all our industrial ills. Our most pressing duty is to find employment for our unemployed workers. Recently, a conference of the International Chambers of Commerce was held in Washington, United States of America. The British Chambers of Commerce sent to the conference a strong delegation, headed by Lord Luke, and on its return the delegation furnished a report, in which it stated -
It is essential to correct the disequilibrium of the balance of trade, and no other means are open to Great Britain than a drastic reduction in the volume of her imports, either by total prohibitions, or by a general tariff.
The report of the British delegation is given in full in the Statist of the 3rd October last. The position of Australia in the matter of international trade is not so favorable as is that of Britain. For the first eight months of the present year, Great Britain’s trade with other countries, including the export of gold bullion to the amount of £20,000,000, showed an adverse balance of about £260,000,000. Owing to the absence of duties, or the low tariffs on a number of commodities, Great Britain had become the dumping ground of almost every other country, with the result that nearly 3,000,000 of her work-people had been thrown out of employment. It is a reflection on the statesmen of France to suggest that the manufacture of perfume in Australia would provoke French hostility towards us; in my opinion, the French people would take ho notice of it. This is certainly a lucrative industry in France. Quite recently a statement appeared in the Australian press to the effect that Coty. having had a matrimonial disagreement with his- wife, and the latter having retired from the business, was prepared to compensate her to the extent of £3,000,000. The perfume industry has already been established in Australia, and its extension is most desirable. Excellent boronia perfume is made from the native flower of that name, and it is within the range of possibility that an export trade in this particular perfume will be developed, to the great benefit of Western Australia. An English poet has written of the sweet perfume of the tuberose, but his words were penned when little was known of the delightfully perfumed flower which is indigenous to the great western State.
The complaint has been made that we are asked to deal with this and a number of other items in the absence of reports by the Tariff Board regarding them; but we are well aware that increased du ties have been imposed because the industrial and commercial conditions of the world have changed so suddenly that prompt and drastic action had to be taken by the Government to correct what the authority to whom I referred a few moments ago has described as “ the disequilibrium of the balance of trade.” If reports by the Tariff Board were submitted in regard to every duty embraced in the schedule, would honorable senators be guided by them ?
– It would not make the slightest difference to Senator Crawford.
– Not long ago, despite a report by a committee which made a comprehensive investigation into conditions in the sugar industry of Australia, many honorable senators were prepared to vote for such a reduction in the price of sugar as would have brought ruin to the industry. This industry, of course, is carried on in only one State, and, in all probability; the perfume industry would be conducted in only one or two States. It is becoming more and more obvious that a great many members of Parliament have a strictly geographical point of view. I shall support the duty under consideration, and most of the proposals in the schedule, because’ I am satisfied that Australia, like almost every other country, must aim at becoming self-contained in regard to manufactured commodities. Otherwise, instead of unemployment being reduced, it will steadily increase. In the course of this debate, not one speaker in opposition to the Government’s tariff proposals has made a practical suggestion as to how we are to find work for the present army of unemployed, which constitutes a grave national danger, and is doing more to promote communism in our midst than all the propaganda being carried on in Sydney and elsewhere. If conditions are made at all tolerable for the working people of this country, communism is unlikely to progress; but, at the present time, the communists are sowing seed in fruitful soil.
– A prohibitive tariff has been in force for two years.
– Yes, but under most abnormal conditions. If many members of this Parliament had not frequently expressed their hostility to the tariff, it would have proved much more effective than it has been in providing employment. I understand the view taken by Senator Pearce, who represents a State whose citizens have decided that they will not have secondary industries. They have put nearly all their eggs into one basket, and, consequently, they are feeling the present depression oven more than the people of the eastern States. It would be a good thing for the latter if the dependent States withdrew from the federation.
– What about the £5,000,000 Queensland has had for sugar?
– Queensland has had nothing of the kind.
– The honorable senator has exhausted his time.
– Any one listening to this debate would be justified in assuming that this was a foreign and not an Australian Parliament. The Leader of the Opposition (Senator Pearce), Senator McLachlan, Senator Lynch and others, seem to be very much concerned about what France might do. Their speeches are practically an invitation to France to retaliate. We have a right to expect to find in this Parliament patriotic Australians, who desire to do their best for Australia. Surely honorable senators opposite must realize that if we are to square our ledger and correct our adverse trade balance it is essential for us to maintain high duties on imports which are luxuries.
– I rise to a point of order. Is the Assistant Minister entitled on this item to discuss the fiscal policy of the Commonwealth? I submit that he should confine his remarks to the item before the Chair.
The CHAIRM AN. - I ask the Assistant Minister to confine his remarks to the item before the Chair, which is perfumed spirits.
– I thought I would be justified in replying to the arguments of some honorable senators opposite, but 1 shall abide by your ruling, Mr. Chairman. “We have been asked whether it is worth our while taking the risk of incurring the displeasure of France for the sake of £10,000. But I remind the committee that that sum would pay interest on a loan of £200,000. Although we have spent only two days in the discussion of the items of the schedule the requests made by honorable senators would, if agreed to, involve a loss of £150,000 a year in revenue.
– Does the Assistant Minister think that the maintenance of these high duties on perfumed spirits will increase the revenue.
– Like my colleague, Senator Daly, I believe that the imposition of these duties is necessary for the encouragement of the perfumed spirits industry of Australia. Surely we can do better with the proceeds of the sale of our wheat and wool than spend them on unnecessary luxuries such as perfumes. Honorable senators opposite have been ready enough to complain about the expenditure of Australian money on motor cars and petrol from America. In a new country like Australia we must protect our secondary industries. Our first duty is to consider the interests of Australia and her industries, and not those of other nations. Even Great Britain has been forced to protect her industries. Bearing in mind that the Mother Country has been manufacturing perfumes for so many years, there is comparatively little, difference between the duties which she imposes on imported perfumed spirits and those which we impose, the figures being British, £4 9s., Australia, £6 5s. Some honorable senators opposite have said, in a half-hearted way, that they are willing to support these duties, but they have asked why the Tariff Board was not requested to investigate the whole subject. The board already has 80 items awaiting investigation.
– Why could it not have investigated the items in the order in which they appear in the schedule?
– That was not necessary, for some items were of such a nature that investigation was not required, while certain items that did require investigation were more important than others.. The Tariff Board could not possibly have dealt with all these items in the time at its disposal. The Government had to act quickly in order to correct our adverse trade balance, and it acted not only quickly, but also effectively. I ask honorable senators to consider whether it is not desirable for us to conduct our negotiations for trade reciprocity with other countries behind the barrier of a high protective wall rather than a low one. If our duties are substantial, we have some room for negotiation. It must be remembered that no country will buy our goods unless it needs them. Even Great Britain overlooked the claims of the Australian fa rmers for Empire preference when Russian wheat was being dumped on the British market.
.- I wish to request that the duties be reduced to British, 40s.; intermediate, 45s. and general, 50s., and ad valorem, 20 per cent., 25 per cent, and 30 per cent, respectively. This would bring them into conformity with those in the 1921-28 schedule, which was agreed to by both Houses of Parliament. My object is not to reduce the duties, but simply to bring them back to what they were before this schedule was tabled by the Government. In order to show how unnecessary these high duties are for the protection of the perfumed spirits industry, I quote the following prices of certain British and Australian perfumes : -
Yardley’s 2 oz. Eaude Cologne -11s., less 10 per cent. f.o.b. London; 35s. 2d., landed cost; 45s., wholesale price.
Yardley’s 2 oz. Lavender Water - 18s., less 10 per cent, f.o.b. London; 47s. 5d., landed cost;61s.6d., wholesale price.
The above landed cost includes 50s. per bulk gallon and 30 per cent,ad valorem duty; 10 per cent, primage; 50 per cent, surtax and. the ruling rate of exchange.
Royal Eau de Cologne, 2 oz.,19s. a dozen, wholesale price.
Faulding’s Eau de Cologne, 2 oz., 18s. a dozen, wholesale price.
Faulding’s Lavender Water, 2 oz.,16s.6d., a dozen, wholesale price.
Potter and . Moore’s Lavender Water, 2 oz., 25s. a dozen, wholesale price.
Those figures show beyond all question that these high duties are not necessary for protective purposes. It is absurd for us to increase by 10s. a gallon the socalled British preferential duty, in view of the disparity between the prices of Australian and British spirits. Such an increase amounts to an absolute prohibition. This industry was adequately protected by the duties imposed under the 1921-28 schedule.
– Before the honorable senator may submit that request it will be necessary for the committee to give Senator McLachlan leave to withdraw his request.
– Does not a request for lower duties take precedence over one for higher duties?
– The honorable senator may only move his request if the ‘committee gives Senator McLachlan leave temporarily to withdraw his amendment.
– I wish to discuss these duties-
– Is it the wish of the Senate that Senator McLachlan have leave to withdraw his amendment?
Leave not granted.
Question - That the request (Senator M cLachlan’s) be agreed to. - put. The committee divided. ( Ch airm an - Senator P l ai n . )
Question so resolved in the negative.
Request (by Senator Payne) proposed
That the House of Representatives be requested to leave out from the duties: - “and ad val., British, 30 per cent.; intermediate, 35 per cent.; general, 40 per cent.”
. - I should have thought that Senator Payne would welcome the fact that the Australian distilleries are turning their attention to the manufacture of perfumed spirit in place of whisky and alcoholic beverages.
– That is the object of my request.
– At least three distilleries in Australia, including wine distilleries, have, under the protection which is given to them under this item, a unique opportunity to manufacture spirits for use in the famous Eau de Cologne scent known as 4711. Already Australian samples of this spirit have been sent to Germany with a view to ascertaining whether they are suitable, because it is absolutely necessary to have an odourless spirit for use in the manufacture of perfume. One would have thought that Senator Payne would be anxious to assist in the manufacture of this spirit in Australia. There is now a golden opportunity for the building up of this industry in Australia. I do not fear retaliation from France on an item of this description. If the French manu- factum’s of famous scents value the Australian trade to any extent, they will establish a factory in Australia, in the same way as French manufacturers, because of the new British tariff, are establishing factories in Great Britain. This item will give valuable assistance to an Australian industry, and will not seriously interfere with our trade with France. The figures quoted by Senator O’Halloran show that the prohibitive duties under this tariff have only partially affected our trade with France. In 1927-28 that country purchased nearly 140,000,000 lb. of our greasy wool, and in 1930-31 it purchased 147,500,000 lb. Our sales of wool to France have, therefore, increased since the operation of our protective policy. The same statement applies to some of our other products, which are purchased by France. Surely, honorable senators, particularly those representing Western Australia, who are so fond of talking about the necessity for building up our export trade in primary industries, will support an item, the object of which is to enable us to manufacture products for export.
. - I intend to support the item as it stands. It is a luxury item, and the Government must have revenue.
– This is a prohibitive duty, and, therefore, no revenue will be gained tinder the item.
– This item will assist in establishing in Australia an industry for the manufacture of perfumed spirit, and so provide more employment for our citizens. Some years ago a certain gentleman went to Tasmania to exploit French perfume. He expended many thousands of pounds in buying a property, clearing the land and erecting buildings upon it for the production of a distilled oil, which is the basis of some of the best French perfumes. What that man has done, hundreds of others can do. This property of 100 acres provides more employment than the many adjoining farms several times its extent. I am referring to an estate called Bridstowe, in the Lilydale district of Tasmania. The owner, an eminent chemist, has for the past four or five years been growing French lavender there.
– He started that industry under the Bruce-Page tariff.
– I am prepared to assist in establishing Australian industries, particularly those which provide considerable employment. There is plenty of room for this industry in Australia. It is largely a primary industry, and certainly deserves adequate protection.
– I shall not support this item, ‘because adequate protection was given under the tariff operating up to 1928-29. One point touched upon by Senator Foll gives us food for thought, and I shall discuss it now in connexion with this item, although it relates to a considerable number of other items. It is easy to talk about the necessity for protecting industries, but I would remind honorable senators that we have in Australia the spectacle of a number of factories operating with plant which is more or less obsolete.
– I rise to apoint of order. Is Senator Kingsmill in order in discussing under this item the general policy of protection?
The CHAIRMAN (Senator Plain).Senator Kingsmill is linking up his remarks with the item before the Chair, and is, therefore, quite in order.
– Those manufacturers who have been crying out to a too-complacent Government for this highly protective duty, will find themselves hoist with their own petard just as others have been, because manufacturers from overseas with more experience and knowledge of plants, and with infinitely more money will, if they think the local market warrants it, supplant them by establishing factories here.
– Would not that be to the advantage of Australia?
– No. That advantage is more apparent than real. I remember that the representative of one firm who came here from overseas, was horrified at the industrial conditions, and instantly returned to his own country.
– Australia was well rid of him.
– Undoubtedly, the honorable gentleman, from his own point of view, is justified in that opinion. The Australian manufacturers would also be of that opinion, because if oversea firms saw fit to compete with them in Australia, they would devour them.
– Is that the opinion of the Housewives Association?
– I do not know why the honorable senator is continually connecting me with housewives. It appears to me that it is a case of mistaken. identity and that the honorable senator is confusing me with some more attractive member of this chamber. I apprehend the very real danger of a dislocation of industry and the raising of hopes that can never be fulfilled. For that reason, it is not wise of us to indulge in this over-production. The gentleman mentioned by Senator J. 23. Hayes was apparently quite content to carry on under the previous tariff.
I keenly resent , it that, because I object to a tariff that I consider is too high, I should be alluded to in this chamber as a freetrader, and outside this chamber as a qualified freetrader. Some honorable senators opposite take every opportunity of levelling that accusation against me and others who think as I do.
– If the duties are wiped out altogether there must be free trade.
– This duty will not be wiped out altogether, and the honorable senator knows it. He, in common with several other honorable senators, is continually putting into our mouths words that we would never dream of uttering. That may be all right in a certain kind of dialectics, but it is not playing the game, and will not conduce to the maintenance of our debates on fair, proper and decent lines. I support therequest.
.- I am quite aware that we have in Tasmania a very fine industry, devoted to the growing of the lavender plant and the making of lavender water, and was pleased when sufficient protection was given in the last revision of the tariff to enable it to perform a useful service.
– Now the honorable senator proposes to take away that protection.
– I am proposing nothing of the kind, and the honorable senator knows it. The suggestion has been made that we should revert to the 1928 tariff; but if my amendment is carried, the duty will become the equivalent of the flat rate and the ad valorem rate of 1928.
– That is not so; it will be below the 1928 tariff.
– I have had no request made to me recently by the gentleman referred to by Senator J. B. Hayes. I had, some years ago, and I placed it before the Government of the day, which recognized the need for giving some protection to the industry. I do not consider that I am justified in supporting this Government when it illegally imposes a tariff.
– The statement that the Government has done something illegal is offensive to me, and I ask that it be withdrawn.
TheCHAIRMAN (Senator Plain).I ask the honorable senator to withdraw the statement that the Minister regards as offensive.
– I withdraw it, and say that the Government has acted contrary to the law. Every honorable senator should be at liberty to speak the truth without being called to order by the Minister. I shall not be a party to anything that is done contrary to the law, even though it is done by the Government. My attitude is not one of antagonism to the Australian industry. Under the 1928 tariff, British lavender water cost twice as much to land here as the price at which the Australian perfume could be supplied.
– So it should.
– But that is not the point. Have we given the industry sufficient protection to enable it to carry on? Senator Kingsmill put the case clearly when he said that, by making the tariff prohibitory we are not likely to develop the industry as it should be developed.
– Perfume is a luxury.
– Not only is it a luxury, but at the present time it is on the list of prohibited imports, and none of it is being imported. If I voted for the duties imposed by the Government I should be lending my support to what is being imposed without regard to the law.
– And the profits!
– That is my reason for opposing it. My proposal is equivalent to the flat rate of 1928, plus the ad valorem rate.
Motion (by Senator Daly) agreed to -
That the committee do now divide.
Question - That the request (Senator Payne’s) be agreed to - put. The committee divided. ( Ch air m a n - S en ator Plai n . )
Majority . . . . 2
Question so resolved in the negative.
Item agreed to.
By omitting the whole item (twice occurring) and inserting in its stead the following item: - “ii. Spirituous preparations, viz.: -
Essences, fruit ethers,aromas and’ flavours, lime juice and other fruit juices and fruit syrups, ‘spirituous preparations, n.e.i. and as to all the goods coveredby paragraphs (1), (2), (3), (4)and (5) of sub-item (b), ad val., British, 30 per cent. ; intermediate, 40 per cent.; general, 45 per cent.”
– I move -
That the House of Representatives be requested to amend sub-itemb by leaving out “and, as. to all the goods coveredby paragraphs (1), (2), (3), (4) and (5) of sub-item (b), ad val., British, 30 per cent.; intermediate, 40 per cent.; general, 45 per cent.”
We have been given no reason whyall these very heavy duties should be advanced to the extent proposed, and I hope that the increases will not be agreed to. The existing tariff afforded ample protection.
. - Honorable senators will appreciate that the increases relate only to the ad valorem rates. The manufacture of this particular class of goods is a highly skilful one.
– There were no ad valorem rates.
– The increased rates of duty are designed to protect an industry which provides employment for highly-skilled chemists, analysts, and trained technicians. The number of employees now directly engagedin the industry is approximately 175. and it is anticipated that further employment will be provided as a result of the increased duty. The effect of the additional duty has been to reduce importations from £82,000 in 1929-30 to £22,000 in 1930-31. As a matter of peculiar interest to the primary producing States, 1 draw the attention of Senator Johnston to the fact that the increased, duty will have a more beneficial effect on the primary than on the secondary industries concerned, because of ‘the consumption of a large quantity of raw materials, particularly in the berry and fruitgrowing industry. The principal raw materials used are raspberries, strawberries, black and red currants, lemons, oranges, and pineapples. Spirits of wine made from molasses is largely used, as also is glycerine. So that, if Senator Payne, in common with other honorable senators, supports the introduction of essences from abroad, he cannot logically come before the Government to ask for another grant of £5,000 to assist the Tasmanian raspberry industry.
Prior to the introduction of the increased duty in June, 1930, the net protection enjoyed by the local essence manufacturers was equivalent to 5 per cent. This percentage is arrived at after having regard to the rates of excise duty required to be paid under the excise tariff on Australian spirit used in the process of manufacture. Certain concessional rates of duty are provided under excise item 2l, on spirits used in the manufacture, of essences, but in practice it has been found that local essence manufacturers prefer to pay the higher rates of duty provided under excise item 2 m, rather than supply to the department details of the ingredients used in the manufacture of essences, aromas, &c. A careful inquiry conducted by the department elicited the information that, in a great number of cases, the process of manufacture of essences is not according to any standard recipe or process, but is the result of original investigations and specialized knowledge, and details of manufacture would not be disclosed to the department even to gain the advantage of lower rates of duty on the spirits used in manufacture. The Government, therefore, decided to grant local manufacturers additional protection by means of an increased customs tariff.
Another aspect of the matter which will doubtless interest honorable senators is that relating to the export trade. A regular but rather small export trade is being done, but so far it has not been found profitable. By granting local manufacturers adequate protection, it is anticipated that production costs will be lowered, so enabling our manufacturers to enter more actively into the export trade, particularly in such countries as New Zealand, China, Japan, the Netherlands, East Indies, and the Straits Settlements. A further reason for making these goods subject to ad valorem rates is that overseas manufacturers of non-spirituous essences, aromas, and flavours, were adding spirit to the extent of approximately 3 per cent, in order to make the goods dutiable at the specific rate of 7s. 6d. a gallon British preferential tariff, and 7s. 9d., general tariff, thus avoiding the payment of the ad valorem rates provided under item’ 11 b, which would return a higher duty than would the rates under item 9 a.
– Why was not the item referred to the Tariff Board?
– For the same reason that the bounty on wheat was not referred to the Tariff Board, because that body has already something like 80 items on its list, and is proceeding as rapidly as it can with its investigations.
– The Government should not have proceeded with legislation until the board had investigated the matter.
– The honorable senator comes from a State that is out to protect the interests of the British manufacturer, the interests of the British bondholders notwithstanding.
– That is a very stupid and offensive remark.
– It is, nevertheless, true.
– It is utterlyfalse.
– Order! I ask honorable senators to cease interjecting, and request Senator Daly to confine his remarks to the item.
– In 1926 the Tariff Board reported against the imposition of increased rates of duty on essences. The principal reason advanced for that action was that the users of essences would still require to use the imported article, as the quality of Australian essences was not of a sufficiently high standard to meet their requirements.
– That has all been altered.
– That is so. The board reasoned that if that were the case, an increased duty could only result in adding to the costs of the raw materials needed for the confectionery, jelly crystal and aerated water manufacturing industries. The imposition of the increased duties has rather exploded that theory, for, as previously stated, importations have decreased from £82,000 to £22,000 which indicates that there has been an increased demand for the locally-produced essences. Finally, in considering this matter, due regard must be paid to the fact that the industries which use essences in the manufacture of their products are all adequately protected by substantial duties, and it is only reasonable to expect that a fair degree of protection will be accorded the essence manufacturing industry. The fact that this industry has been able to carry on with such a small margin, and at the same time pay duties on its raw material, is a wonderful tri- bute to the efficient manner in which it has been conducted. I admit that it would have been preferable, if possible, to place all these tariff impositions before the Tariff Board for investigation.
– This item has been placed before the Tariff Board.
– Yes, and a report was made upon it. In framing its tariff policy, the Government had to keep in mind two important things: the need for protection to keep as many as possible of our own people in employment in secondary industries, and the fact that our wool, wheat, and other primary products had to bear the burden of paying our interest commitments as well as of providing the credits to pay for our necessary importations.
– A third matter should have been considered, the amendment of the Tariff Board Act.
– Personally, I disagree with the interpretation that has been placed on the section of the Tariff Board Act that is referred to. I contend that the Government has done nothing that is contrary to law.
– It was admitted in a reply to a question that was asked by me that the Government has violated the law.
– Nothing of the kind was admitted. The honorable senator simply asked why these matters were not referred to the Tariff Board, and the perfectly logical and legal defence of non possumus was raised.
– The Minister said that he was satisfied with the legality of the act if Parliament ratified it.
– Even if Parliament refused to ratify it, the act would not be illegal. It might as well be said that the waterside workers regulations are illegal. The position- is that Parliament delegated power to the Executive Government to bring in a tariff schedule in connexion with this and other items. The Senate expressed a desire that the schedule should be brought before it, which has been done after a lapse of two years, yet this afternoon honorable senators discussed for two hours such a simple item as the duty on scent! I hope that the request will not be agreed to.
.- It. is all very well for the Minister to try to dismiss these matters lightly. The Tariff Board made a most exhaustive investigation of this item, and its conclusions and the reasons for arriving at those conclusions should be of interest to honorable senators. They are embodied in the report of the board, dated the 9th July, 1926. This afternoon we have been endeavouring to discuss the revenue portion of the tariff. As these additional duties involve the levying of a heavy tribute upon the people of Australia, the onus is upon the Minister to justify the action of the Government, either by another Tariff Board report, or by some statement from an authoritative source. That he has not done. This inquiry was fought most fiercely. There were fifteen to twenty witnesses in favour of the request, a number against it, and 40 to 50 manufacturers’ representatives appeared, representing both sides. The summary to the report reads -
The board heard voluminous evidence on the question of rates of pay and hours of work in Australia and England, but in view of the fact that Australian prices of essences are lower than the imported, the board does not consider it necessary to load this report with figures.
I am sure that honorable senators will be struck by the fact that Australian prices of essences are lower than the imported prices. Why then, are our essences not used? The trade is always anxious to obtain a low priced article, provided that it is of equal quality with the more expensive product. The report continues -
The Tariff Board . was impressed by the unanimity of the opposition to an increase in the duty from the vast majority of the users of essences in the different manufacturing trades concerned.
A dozen or more manufacturing trades were concerned in opposing the request for higher duties, and in the light of the board’s report it behoves us to move cautiously lest we impose a burden not only on the public but also on manufacturers. The report continues -
In addition to this the manufacturers of local essences were by no means unanimous in support of the application.
Despite the solid phalanx of manufacturers ofaerated waters, confectionery, and jelly crystals who were opposed to the application, and the division of opinion amongst the makers of essences, we are asked without further explanation, except parrot-like references to the trade balance, to increase these duties.
– The report was made five years ago.
– If the honorable senator has knowledge of all that has happened in the trade since 1926, I shall welcome the information. In the absence of authoritative and up-to-date data I prefer the considered views of the experts who were appointed to be the eyes of Parliament in regard to the -tariff. The board’s report stated -
All the evidence confirmed the fact that the landed cost at present of the imported essences is higher than the price of Australianmade essences; the difference varies with different essences and according to the evidence was as great as 70 per cent, in some instances.
Local manufacturers who use such essences in the preparation of jelly crystals, custards and blancmange powders and prepared icing sugar, notwithstanding this wide difference in price, swear that they are compelled to use 80 per cent, of the English along with 20 per cent, of the Australian essences in order to enable them to maintain their standard of quality and flavour in “competition with the imported jelly crystals, &c.
Whenever possible they would naturally give a preferenceto the Australian essences., more particularly since the price is so much lower. An increase in duty would only result in an increase in the price of their commodities since they would still be compelled to use the English essences to maintain their standard, with the result that with the present protection on jelly crystals they would be in danger of losing their trade. Already their overseas competitors obtain their other raw materials - sugar and gelatine - on far more favorable conditions. . . .
Consequently any increase in duty on essences would not lead to any greater consumption of fruits in connexion with their business. Synthetic essences are a necessity to them. . . .
Any increase in the duty that might be granted would mainly result in an increase in the price of aerated drinks without benefiting the Australian fruit-grower or essence maker, since they would still continue to use the imported essences in order to maintain their standard.
The board declined to recommend any increase of duty, and the last Government acted on that advice. Now the present Minister for trade and Customs (Mr. Forde) has increased the duties by 30 per cent., 40 per cent., and 45 per cent. I believe in supporting the manufacturers of fruit essences, for the sake of the fruitgrowers, but if the effect of increased duties will be what the Tariff Board has said, we shall be doing an injury to the fruit-growers if we allow this item to stand in its present, form. The importation of synthetic essences is declared to be necessary. Are not our people to have cheap aerated waters?
– The imports were reduced from £82,000 to £22,000, and nobody protested.
– It is obviousthat the Government has imposed this duty in order to get revenue.
– Then it . should not be imposed at all. In those circumstances I shall support the amendment.
– I oppose the amendment. There is an effective reply to Senator McLachlan’s argument. Since the Tariff Board’s report was prepared in 1926, the conditions of the industry have entirely changed.
– What evidence have we of that?
-I am in formed that the cost of the imported essences has been reduced by approximately 30 per cent. If it was necessary, in 1926, as the Tariff Board declared, to import essences for blending with the Australian product, it is so no longer The experience which our manufacturers have gained since has enabled them to produce essences that are suitable for all requirements. The fact that, although the importations have been reduced from £82,000 to £22,000 per annum no interested person ‘has protested, is signifi cant. Even the firms for whom Senator McLachlan pleaded this afternoon have not made any protest against the increased duties.
– I rise to a point of order. I pleaded for no firms. Iam untrammelled and free to do my duty by the people. I demand a withdrawal of a statement which I regard as personally offensive.
– If the honorable senator considers the remark offensive, I withdraw it. He quoted from the evidence given by some firms before the Tariff Board; such evidence apparently influenced his mind and he, in turn, endeavoured to influence the committee. I am just as un trammeled as ho 13. No protest has been made against the increase of duties, probably because of the improvement in the quality of the Australian product; indeed, at the last Royal Agricultural Show in Melbourne the manufacturers of cordial from Australian essences took first and second prizes in all divisions in competition with firms using imported essences. Senator Payne on other occasions has made earnest appeals on behalf of the berry fruit-growers of Tasmania, and the Government, being sympathetic, a year or two ago, placed £5,000 on the Estimates to assist them. As all their difficulties have not yet been overcome, these duties should assist them, because of the increased demand for raspberries, strawberries and red currents, all of which are produced in Tasmania. Growers of pineapples, lemons and oranges, and, in fact, of nearly all fruits, should benefit from the operation of these duties. We should encourage the exclusive use of Australiangrown fruits in the manufacture of cordials, jelly crystals, &c, rather than synthetic essences, as advocated by Senator McLachlan.
– I did not advocate the use of synthetic essences; I merely read from the report of the Tariff Board.
– It is singular that, in the whole of this debate about the attitude of the Government towards the Tariff Board, the only quotation made from a report of the board is distinctly in opposition to the duties proposed by the Government with respect to this item.
– It is evident that this tariff will not be finally dealt with until after the next election, when the new Government will have to take full responsibility for it. We bars heard the argument that the 1928-29 tariff was sufficient for protective and revenue producing purposes, but under that tariff, the Commonwealth very nearly went insolvent, because of the flood of importations far beyond the capacity of the country to pay for and keep its people in employment.
– Our present troubles are due to over-borrowing.
– Every party and every government has been responsible for over-borrowing in the past.
– The honorable senator must confine his remarks to the item.
– I must bow to your ruling, Mr. Chairman, but I consider that you should allow me the same latitude as that given to other honorable senators. I was about to point out that the 1928-29 tariff proved totally inadequate for the protection of Australian industries, because under it we spent on imports as much as £150,000,000 a year. Since then our circumstances have changed entirely. We are no longer able to employ a large proportion of our people upon works which, in previous years, were paid for with borrowed money.
– The honorable senator is again straying from the item.
– Since I must obey your ruling, Mr. Chairman, I am afraid that I shall not be able to take any further part in the discussion upon this item.
Question - That the request (Senator E. B. Johnston’s) be agreed to - put. The committee divided. (Chairman - Senator Plain.)
Majority . . . . 4
Question so resolved in the affirmative.
Request agreed to.
Item agreed to subject to a request.
Item 10 (Ethers and chloroform.)
By omitting the whole of sub-item (11) and inserting in its stead the following sub-item: - “ (b) N.E.I., containing not more than 5 per cent. of proof spirit, ad val., British,35 per cent.; intermediate, 40 per cent.; general, 45 per cent.”
– I move -
That the Houseof Representatives be requested to make the duties, sub-item (b), British, 20 per cent.; intermediate, 25 per cent.; general, 30 per cent.
Until this schedule was placed on the table in another place the duties were - British, 15 per cent.; intermediate, 20 per cent.; general 25 per cent. It is now proposed to increase those rates to 35 per cent., 40 per cent. and 45 per cent. respectively. My request is to reduce them to 20 per cent., 25 per cent, and 30 per cent.
– When I explain the reason for the increase, the honorable senator will probably withdraw his request. The whole item relates to ethers and chloroform. In 1028-29, the importations of ethers n.e.i. containing not more than 5 per cent. of proof spirit, were as follow: United Kingdom, £1,166; foreign countries, £9,524; a total of £10,690. In the following year the figures were - United Kingdom, £499; foreign countries, £7,325; the total being £7,824. For the year 1930-31, the importations dropped to - United Kingdom, £343: foreign countries, £6,410; a total of £6,753. The action taken in increasing the rates of duty is to circumvent overseas exporters who, in the past, have resorted to the practice of placing more than 2 per cent., but not more than 5 per cent., of proof spirit in amyl acetate in order to gain the advantage of the lower rates operating under this subitem, namely, 15 per cent. British, 25 per cent. general. These rates have, therefore, been made the same as those operating on non-spirituous amyl acetate and ethyl acetate under item 11 a. This step has been taken by the Government, not with the idea of affording protection, as we understand the term in a tariff sense, but with a view to safeguard the revenue. It was the analyst connected with the Customs Department who advised the department as to the manner in which the overseas exporters were taking advantage of the lower rates of duty applying to this sub-item.
– The explanation for the increase of duties is quite satisfactory. I seem to remember that when the last tariff was going through Parliament, this matter was raised, and that there was a suggestion that importers by holding alcohol in some other form could evade paying higher duties. I ask leave to withdraw my request.
Request - by leave - withdrawn.
Sitting suspended from 6.15 to 8 p.m.
Rem agreed to.
By omitting the whole of sub-item (b) and inserting in its stead the following sub-item: - “(b) Etherealfruit essences and artificial fruit essences, ethers, aromas and flavours, non-spirituous, n.e.i., per lb. - British. 3s.6d.; intermediate, 4s.; general, 5s., or ad val., British, 30 per cent.; intermediate, 40 per cent.; general, 45 per cent.; whichever rate returns the higher duty.”
.- The Tariff Board recommended the following duties: - British preferential, 20 per cent.; intermediate, 25 per cent.; and general, 30 per cent., whereas the present duties are, per lb. - British, 3s. 6d.; intermediate, 4s.; and general, 5s., or ad val., British, 30 per cent.; intermediate, 40 per cent.; and general, 45 per cent., whichever rate returns the higher duty. In the absence of any information to justify the increase in duties, I move -
That the House of Representatives be requested to leave out the duties, sub-item (b) “ per lb. British, 3s.6d. ; intermediate, 4s. ; general, 5s.:” and make the duties, ad val., British. 25 per cent.; intermediate, 35 per cent.; general, 40 per cent.
– For the information of the committee, I supplythe following figures with respect, to importations : -
The total values of importations are for 1928-29, £1,116; 1929-30, £479; and 1930-31, £409. In view of these figures, I think the committee should agree to pass the item in its present form. This subitem was introduced as a corollary to the increased rates under sub-item 9 b> If the House of Representatives agrees to the request of the committee with respect to sub-item 9 b, an anomaly would exist unless there were also an alteration in the duties under this sub-item. If the duties under sub-item 9 b are not restored, and these duties remain, an anomaly will exist.
– Why have the duties been increased when the importations were falling off?
– The committee has to consider the tariff from the view-point of revenue, protection of our industries, and of balancing our overseas trade. The Government does not wish to encourage the person who has credits overseas and wishes to import goods that we can do without. We wish to assist the banks in conserving credits overseas. It has been suggested that if the duties under this sub-item and sub-item 9 b do not harmonize, those using these commodities may substitute one for the other. I do not propose to call for a division, but the committee should understand that tha, Government does not support -the request submitted with respect to sub-item 9 b or this sub-item.
Request agreed to.
Item agreed to subject to a request.
Items 12 and 13 agreed to.
Division II. - Tobacco and Manufactures thereof.
to postpone this* division until the other items in the schedule have been disposed of, or until the board has furnished its report on the tobacco duties.
– Perhaps it would meet the convenience of the Leader of the Opposition (Senator Pearce) if the consideration of these duties were postponed until Division 15 has been disposed of.
– I am agreeable to that.
Division III. - Sugar.
By omitting the whole item and inserting in its stead the following item: - “27 Glucose.. ]>er lu., British, 2d.; intermediate, 2d.; general, 2d.”
. -The importation of glucose has been prohibited since April, 1930. The Tariff Board recommended that the duties should be increased to £15 per’ ton, but the rate of 2d. per lb. in the schedule amounts to £18 13s. 4d. per ton. I, therefore, move -
That the House of Representatives be requested to make the duties, per ton, British, £15; intermediate, £15; general, £15.
– To-day I received a telegram reading - “ Confidently ask your support re glucose tariff. We used last year 400,000 bushels of Queensland maize. Unless industry is adequately protected against foreign glucose our output will decrease.” Our importations of glucose from all countries during 1926-27 were valued at £22,317 ; in 1927-28 at £17,179, and in the two next succeeding years at £9,531 and £8,270, respectively. During 1930-31, however, our importations of glucose amounted to only £28.
– During that year the embargo operated.
– There has been no complaint from the users of glucose. It is pleasing to note that in that year 400,000 bushels of Queeusland maize were used in the manufacture of glucose. One of lbc greatest difficulties confronting Australia is that of absorbing our population. We shall not absorb a greater population by building expensive bridges across harbours, or erecting bank buildings costing £1,000,000- each; but there is a chance of the absorptive capacity of the country being increased if we can grow maize and sell it.
– What percentage docs this duty represent?
– Nominally, 75 per cent.; but no one has complained that it is too high. Protests have been made against many items in the schedule, but there has not been any complaint regarding this item. On the other hand, a market has been found for 400,000 bushels of Queensland maize.
– Are we to judge a duty according to whether or not complaints have been made about it, or should we be guided by our own reason ?
– To some extent we must be guided by complaints, or the absence of them. This duty protects a primary industry as well as a secondary industry. In 192S American manufacturers were exporting glucose to Australia and selling it at less than the price realized in the home market; they were dumping glucose into Australia.
– Were they not prevented from doing so?
– - Section 4 of the Industries Preservation Act was applied to glucose of American origin after a report had been furnished by the Tariff Board.
– What were the respective prices of American glucose in Australia and in the home market ?
– American glucose which was sold to Australia at 3.75 dollars per cental, was sold in the United States of America at 4.35 dollars per cental. During the year ended 30th June, 1929, Australian manufacturers of glucose had approximately 94 per cent, of the Australian market. There is no reason why they should not supply the whole of Australia’s requirements of this commodity. Every year over 500,000 bushels of maize are used in the manufacture of glucose in Australia. An adequate duty on glucose will provide an increased market for Australian-grown maize. Under the 192S tariff, Great Britain was accorded a preference of £3 per ton, but that preference has been discarded in the present proposals, since our imports of glucose from Britain are negligible. At the time that the duty of 2d. per lb. was imposed, Maize Products Limited gave its clients the opportunity to book six months’ supplies of glucose at the price which ruled prior to the imposition of the. higher duties. That is an instance of a manufacturing firm not desiring to exploit consumers. The Australian production of glucose for the year ended 30th June, 1927, amounted to 7,096 tons. In the following year it was 8,060 tons, and for the year ended 30th June, 1929, it was 8,179 tons. For the half-year ended 31st December, 1929, the production of glucose in Australia amounted to 4,48.1 tons. Honorable senators will see that the Australian production of glucose increased as imports decreased. Since the imposition of the increased duties, Maize Products Limited has been able to retain its full staff of 222 employees, whereas prior to their imposition, a reduction of staff appeared to be inevitable. It will be seen, therefore, that the higher duties, while calling forth no complaint from the consumers of glucose, have provided a market for Queensland maize, and given employment to 222 Australian workers.
– What is the current price of glucose?
– I understand that it is about £1 16s. per cwt. Before rejecting the Government’s proposal, I ask honorable senators to consider whether any variation of the duties, as set out in the schedule, will make it possible for overseas manufacturers of glucose to dump J;heir products into Australia, thereby destroying at least a portion of the home market for important primary and secondary industries?
Senator Sir GEORGE PEARCE (Western Australia) [8.23]. - The overseas Trade Bulletin, No. 27, shows that in 1929-30 Australia imported 8,270 cwt. of glucose, of which 6,664 cwt. came from the Netherlands, and only 1,148 cwt. from the United States of America. Very little came from Great Britain and Netherlands
East Indies. It is true that in the manufacture of glucose the product of a primary industry - maize - is used; hut glucose, in its turn, is the raw material of a number of secondary industries. Reckoning glucose at £1 per cwt - the price at which it is entered for customs purposes - the amendment moved by Senator Sampson would still give a duty of 75 per cent. ; the Government’s proposal represents a duty of 85 per cent. Glucose is used by confectioners and brewers in all the States. In 1929-30, New South Wales imported 4,380 cwt. of glucose ; Victoria, 1,729 cwt. ; Queensland, 509 cwt.; South Australia 985 cwt., and Tasmania, 667 cwt. A prohibitive duty will place manufacturers who use glucose as a raw material at the mercy of a possible combine in Australia, whereas, Senator Sampson’s proposal, while providing ample protection to an Australian industry, would leave room for competition. We do not ask that the Australian industry shall be left without protection; but wc do suggest that it be not freed altogether from competition. Surely 75 per cent, is an adequate protection ! The amendment if agreed to will subject the Australian manufacturer of glucose to competition from overseas should he unduly raise the price of his commodity to local consumers.
.- In 1926-27 Australia imported 25,431 cwt. of glucose, of which 21,140 cwt. came from the United States of America, and only 10 cwt. from Great Britain. In the following year our imports of glucose amounted to 19,35S cwt., of which the United States of America supplied 16,457 cwt.
– Was that not. because of a drought?
– Of the 9,950 cwt. of glucose imported in 1928-29, 8,708 cwt. came from the United States of America.
– That country buys very little from Australia.
– In 1929-30 we imported from the United States of America 793 cwt. of glucose out of a total importation of 7,879 cwt. In that year we obtained 6,686 cwt. from the Netherlands. In 1930-31 our importations of glucose . from all countries dropped almost to vanishing point. We imported from the United Kingdom 10 cwt. of glucose in 1926-27 ; in the following year, 271 cwt.; in 1928-29, 20 cwt.; in 1929-30, 6 cwt., and a similar quantity in 1930-31. Our importations from Belgium for the three years ended 30th June, 1929, were respectively, 2,579 cwt, 1,893 cwt., and 455 cwt. ; but during the two years ended 30th June, 1931, no glucose was imported from that country. The importations from other foreign countries were as follow: 1926-27. 522 cwt.; 1927-28, 53 cwt.; 1928-29, 1 cwt. 1929-30, 394 cwt.; 1930-31, nil. Therefore, the Leader of the Opposition (Senator Pearce) cannot fairly contend that this duty has no significance from the primary producer’s point of view. I have already quoted a. telegram showing that it. really keeps the market in Australia for 400,000 bushels of Queensland maize.
– So would the lower duty now proposed.
– It is of no use saying that. I have stated the importations into Australia of this commodity prior to the introduction of the present Government’s tariff policy.
– When there was a duty of 2d. per lb., why did glucose come in at all?
– Were there not two occasions on which the duty was lifted to allow maize in from other countries, on account of the reduced Australian production?
– Should that happen, the present duty could be lifted. The Government asks honorable senators to proceed on the assumption that at the present time Australia can supply its own requirements. If we do not give this protection, it must be admitted that we shall be adopting at least a dangerous course.
– With 75 per cent, protection?
– I have not received a single protest from a brewer, a confectioner, or any other person who uses’ this primary product. I have received complaints about sugar, but maize seems to be the only product of Queensland about, which the manufacturers arc nol concerned. So far as I am aware, no confectioner in Australia has complained concerning the cost of glucose. In view of the fact that this duty means so much to the maize industry, honorable senators should not capriciously support the amendment. If they give the matter the fullest consideration, then, under the give and take policy that operates in this chamber, the representatives of the southern States will assist those from Queensland to keep the important Queensland industry of maize production in operation.
– I cannot see why exception is taken to this duty which, as Senator Pearce has remarked, amounts to 75 per cent, ad valorem, when we have already agreed to a duty on wine which is equivalent to over 400 per cent. It is true that 400,000 bushels of Queensland maize are purchased annually by Maize Products Proprietary Limited, but I am informed that a considerable quantity of the maize bought by that company is grown at Orbost, Victoria. Some years ago, nearly the whole of the maize produced in Australia was used as fodder for working horses, but now there is far less demand for fodder for working animals, and another outlet has been secured for some of the maize. It cannot be shown that since this duty has been increased, the manufacturers of confectionery have raised their prices. I venture to say that confectionery is cheaper in Australia to-day ‘than it has been for years. . In Brisbane, recently, I saw what appeared to be quite good chocolates, made by the largest manufacturer in New South Wales, displayed for sa.le at ls. per lb., and I noticed chocolates similarly priced in Sydney yesterday. Notwithstanding the present depression, manufacturers of confectionery seem to keep fairly busy, and a number of new, though small, manufacturers have established themselves in the principal cities of the Commonwealth. Much has been said about the need for assisting the primary producers, and here is an opportunity for honorable senators to prove their sincerity. If maize-growers in Queensland and elsewhere are not able to retain the present market for their product, it will have to be sold in competition with other products, or the primary producers will have to endeavour to sub stitute something else for what is now sold as raw material for the manufacture of glucose.
– Potatoes, for instance.
– Yes. The Atherton Tableland, where maize is now grown, is as suitable as any other part of Australia for the production of potatoes. There is hardly a district in Queensland, from Cape York to Tweed Heads, where potatoes cannot be successfully produced, and if the farmers of Queensland decided to grow them, the mainland market for Tasmanian potatoes would be gone for ever. At the present time, Queensland is not growing sufficient potatoes for its own requirements, but it could easily supply the needs of the whole of Australia.
The CHAIRMAN (Senator Plain).The subject of potatoes is not under discussion.
– I have alluded briefly to what would be one of the inevitable effects of the loss of the market for Queensland maize, and, with all respect, I contend that my remarks are relevant to the subject under discussion.
– A certain quantity of glucose is produced from potatoes ?
– Yes ; .and a certain quantity of spirit also, but potatoes are not used in Australia for those purposes at the present time. If a market for a particular product is lost, and if a substitute market cannot be obtained, another product must be grown in its place.
– But the maize producers did not lose their market in 1929, when the lower duty was in operation, and why should they lose it if that duty were put into effect again?
– The present circumstances are very different from those of 1929. Many economic changes have taken place throughout the world, and we must adapt our tariff to meet the present circumstances. Is it to he assumed that every law passed by this Parliament is to be left unaltered for a century? We are always tinkering with some act or other which, when first placed before us, was regarded by its authors as the last word in legislation on the particular subject with which it dealt. Sometimes, before the close of the session in which a measure was passed, we have had occasion to amend it.
– It is absurd to talk of what action might be necessary if my amendment were accepted. Subsequent to the 1926 tariff, the Tariff Board went fully into this subject. An application was made by Ma Use Products Proprietary Limited, of Footscray, Victoria, which asked that the duty on glucose be increased to 2d. per lb. equivalent to a i.i increase of 100 per cent., ad valorem. Those in favour of the application were five representatives of Maize Products Proprietary Limited, and Mr. Frederick John Riley, secretary of the Manufacturing Grocers Employees Union. Among those who opposed the application were CadburyFryPascall, Limited, Claremont, Tasmania ; Mr. Frank G. Newell, merchant, of Sydney; Mr. Percy Chambers Hemphill, manager of General Household Supplies Company, Melbourne; Mr. John Arthur Hinder, manager of Walton’s Limited, Adelaide; and Mr. Thomas Leonard Taylor, secretary of James Hill and Sons, agents in South Australia for Corn Products Company, of New York. The board reported -
It has been ascertained that imported glucose is being sold to buyers in the Commonwealth at £19 per ton ‘ c.i.f.e. Australia. This, with a duty of f 12 per ton on glucose and £1 10s. upon casks, is equivalent to £32 10s. landed, duty paid, whereas the cost to the Maine Products Company of Australia works out at £33 (is. 4d. per ton. This includes all overhead charges which amount to practically 0 per cent, of the total cost. At this price no provision is made for profit.
In view of this competition the Maize Produets Company is compelled to sell its product to buyers in other States at prices ranging from £33 to £38 per ton. The higher figure applying to distant States which the coastal freight is a greater charge.
During the last few years competition from United States of America has become keener, with the result that the local manufacturer, in order to maintain his connexion, had to meet overseas prices at his own cost.
After dealing with the cost of producing glucose in America the report continued -
The reason that the manufacturer in the United States of America is in the position to undercut the Australian price is due to the favorable position he occupies in respect to the raw material. While Australian maize has cost the local manufacturer from 4s. 7Jd. per bushel, the present price is from 5s. 7d. to 5s. 9d. per bushel as against the American price of 4s. 1 1/2d. in July, 1 025, 3s. 2d. in October, 1025, and 2s. lOd. in March, 192(i.
From these figures it will be seen that while the overseas manufacturer is producing his glucose from maize, the price of which has considerably fallen within the last twelve months, the local manufacturer has to meet’ the higher costs of maize in Australia. In fact at the present time on account of shortage, he has to meet his needs by importations from South Africa.
Were it not for the fact that the loading confectionery manufacturers in Melbourne, Sydney and Brisbane are shareholders in the Maize Products Company, it is quite likely’ that the competition from overseas would have succeeded in extinguishing the local industry.
Attention is invited to the fact that it costs £33 (is. 4d. per ton to produce glucose in Australia, while American glucose is landed in the Coin mon wealth n.t £33 ls. 4d. per ton duty paid. Whatever has been done in the past with regard to bonus shares, the position now is that the Australian manufacturer is in a very bad position as compared with manufacturers abroad.
It is impossible to speak of the future position of the maize in the respective countries, that is whether the price in America will rise or that in Australia will fall. There is a shortage in the Commonwealth at present necessitating importation from South Africa while apparently on the low American price there is an abundant harvest in that country.
In order to compete with the low American prices the Australian manufacturer is obliged to sell in some cases mi a very narrow margin of profit and in one ease at least, without any profit at all.
The board recommended -
In view of these circumstances as well of the receding prices and increasing importations of American glucose, the Tariff Board considers that the Australian industry is in need of further protection, and accordingly recommends the present duty of £12 per ton to be increased to £15 per ton.
My request is in accordance with that recommendation.
– I am loth at any time to depart from the recommendations of the Tariff Board, but I am informed from the Atherton Tableland that 8,000 tons of Queensland maize is sold yearly to the manufacturers of glucose in Melbourne, and that the grower is largely dependent upon this market. The production of glucose is so closely identified with the agricultural industry that a. slight departure from the Tariff Board’s recommendation is justified. I confess that my attitude is influenced to some extent by concern for an industry in the State I represent. The difference between the duty proposed by the Government and that recommended by the board is only one-third of a penny per lb., which is small in comparision with some of the increases contained in the schedule.We have to remember also that the producer does not get any benefit from the exchange position. I shall support the item in the schedule.
.- I remind the committee that Queensland is not the only State interested in the production of maize, but the stabilization of price, which has attended this increased protection, has been the salvation of hundreds of returned soldier settlers on the Atherton Tableland. The Commonwealth in conjunction with the State Government put these men on the land to grow maize, and it is our duty to do what we can to ensure to them a reasonable price for their product. In 1929-30 the total production of maize in the Commonwealth was 7,946,320 bushels, of which ‘New South Wales produced 3,035,850 bushels; Victoria, 533,719 bushels; and Queensland, 4,376,41.2 bushels. . I trust, therefore, that the senators representing New South Wales and Victoria will support this additional protection to an important section of primary producers. If Senator Sampson is making this request merely in pursuance of the vendetta against Queensland which was started by SenatorColebatch-
– . I rise to a point of order.If for no other reason than that I served in a Queensland unit throughout the war, I resent, the imputation that I am pursuing a. vendetta against that State, and I” ask that it be withdrawn.
– I withdraw the statement; I have no desire to be unfair to the honorable senator. During the debate on the second reading, the Leader of the Opposition emphasized the need for assisting the primary producers, and senator after senator, whether opposed to the schedule or in favour of it, endorsed that plea.
– Who will get this assistance - the primary producer or Maize Products Proprietary Limited?
– Senator McLachlan’s fury over this small increase of duty contrasts strangely with his acquiescence in a duty of 400 per cent, on wine, which is produced principally in the State which he represents. I hope to be more consistent. In my second-reading speech, I urged that the schedule should be revised in the direction of helping the primary producer, and I welcome the opportunity which this item affords, to come to the aid of the maize-growers who for years were unable to get a reasonable price for their product.
– We are told that the main purpose of this duty is to protect the primary producer, and Senator Foll spoke of what it had done to stabilize the price of maize. The Tariff Board recommended a duty of £15 per ton on glucose, mainly because the American manufacturers were able to buy maize for 2s.10d. a bushel, whereas Maize Products Proprietary Limited was paying from 5s. 7d. to 5s. 9d. That was in 1927 ; since that date, this increased duty has been imposed, and according to the Sydney Morning Herald of to-day, maize is realizing 2s. 7d. a bushel in Brisbane.
– What is world’s parity?
– The position in Australia has no relation to world’s parity. « The Minister could not, a few minute ago, tell us how many bushels of maize are required to produce a ton of glucose, but the Tariff Board has given the quantity as 76 bushels. Taking the price of maize to-day in Melbourne, where the factory of Maize Products Limited is situated, the growers are paid £12 less freight for 76 bushels of maize. The manufacturer is already receiving by way of protection the whole of the £12 ho now pays for the 76 bushels of maize, as well, as an additional present of £6 13s. 4d. That will be of no benefit at all to the producer. These manufacturers have been given protection for the express purpose of enabling them to give a fair deal to the growers, but they have failed to give effect to their undertaking. The statement of some honorable senators that the imposition of this duty has stabilized the price of maize is not borne out by the facts.
– It does prevent imports of glucose.
– Probably it does; but when glucose was imported into this country, was the price of maize less than it is to-day?
– Of course, it was.
– When glucose was last imported into this country the price of maize was 5s. 9d. a bushel. Now the duty has been increased to £18 13s. 4d. a ton, the maize-growers of Queensland arc receiving 2s. 7d. a bushel in the Brisbane market, not at the farm. At the most, the price at the farm would be 2s. a bushel.
– The same position applies in respect of wheat and oats.
– There is not a duty of £18 13s. 4d. a ton on oats or any other cereal which might be imported into this country. I rose merely to refute the argument that the imposition of this duty has provided a market for the local maizegrower. Actually, it has done nothing of the kind.
.- The further this tariff debate proceeds, particularly on the item of glucose, the more puzzled I become as to the attitude of certain honorable senators towards the Government’s proposals. Some honorable senators have stated that they are geographical protectionists, others that they are local protectionists. During the secondreading debate Ave were told by some honorable senators that we should be particularly mindful of the interests of the primary producers. The Leader of the Opposition (Senator Pearce), who is supporting the request for a reduction of duty under this item, made a special point of that.
– The figures quoted by Senator Carroll show that the duty on glucose has been of no benefit to the maize-growers:
– It has been demonstrated by the Minister and by Senator Foll that the glucose industry in Australia absorbs over 500,000 bushels of Australian-grown maize per annum, and thus secures for the maize-growers Australian parity for their product. If it were not for the glucose industry they would either have to discontinue growing that quantity of maize, or have to seek a market abroad. What is the world’s price of maize to-day? Senator Carroll brushed aside that factor, although it had an important influence on the imposition of this duty. We have been told for mouths past that in the United States of America, the principal maize-growing country in the world, maize is unsaleable, and is quoted at under ls. a bushel.
– There is no evidence before the committee to that effect.
– Any one who studies the press market reports must be aware of the fact that maize is quoted in the United States of America at under ls. a bushel. We have been told that the farmers there are using this product, for fuel, because they cannot dispose of it. A moment ago the Leader of the Opposition interjected that the figures quoted by Senator Carroll clearly showed that the duty on glucose had been of no benefit to the maize-growers of Australia. Let me inform the right honorable senator that the imposition of this duty, together with the consequent encouragement given to a local industry, has provided a market “‘for over 500,000 bushels of maize per annum, 400,000 bushels being supplied by Queensland and the remainder chiefly by Victoria, in which State the factory of Maize Products Limited has been established. Senator Carroll stated that 76 bushels of maize were required to produce a ton of glucose, and that in return for that 76 bushels the grower received £12 a tout He omitted to mention that the cost of conveying the maize from the farm to the factory is a charge against the glucose industry. The transport of the maize provides employment for our railway men, seamen, wharf labourers, and others who handle it at the different points between the farm and the factory.
– The grower pays the transport charges.
– Does the honorable senator suggest that the cost of transport to the factory at Melbourne is deducted from the price of 2s. 8£d., as quoted yesterday at Roma-street, Brisbane?
– The grower pays transport from his home town to Romastreet.
– The farmer, who grows maize on the Atherton tableland, where the bulk of the maize used by Maize Products Limited is secured, sends his product direct to the nearest port, which, is Cairns. Ho receives the f.o.b. price at Cairns, which is equivalent to the f.o.b. price at Romastreet, Brisbane.
SenatorMcLachlan. - What becomes of the balance of the Australian output?
– It is manufactured into cornflour and maizena, or is used for feeding stock. The Leader of the Opposition (Senator Pearce) stated that this duty penalized the confectionery industry. We learn from the Tariff Board’s report, which was quoted by Senator Sampson, that . leading confectionery manufacturers in Melbourne, Sydney, and Brisbane are shareholders in Maize Products Limited. These manufacturers must have had some good reason for organizing the maize industry to ensure a supply of glucose, a product which is needed in the manufacture of confectionery. Doubtless they discovered that they were being exploited by the exporting countries. The figures quoted by Senator Daly show that, prior to this Government taking office, the principalcountry supplying Australia’s requirements of glucose was the United States of America.
– That is not so, because the imports from that country declined considerably in 1929.
– In 1926-27, our total imports of glucose were 25,431 cwt., of which the United States of America supplied 21,140 cwt. In 1927-28, we imported 19,358 cwt., of which the United States of America supplied 16,457 cwt. In 1928-29, we imported 9,950 cwt., of which the United States of America supplied 8,708 cwt. During those years the bulk of our imports were from the United States of America, a country which has studiously refused to purchase Australian products although for many years the balance of trade has been against us. We were told by the Leader of the Opposition, during the second-reading debate, that we should so frame the tariff as to encourage trade with those countries which traded with us, and he showed little sympathy with our wealthy uncle across the Pacific. Now he is championing the cause of American glucose as against Australian glucose. I admit that in 1929-30, when our imports were 7,879 cwt., the United
States of America supplied only 793 cwt. But there is a good reason for that. The American competition in the three previous years had been so intense and severe that the Industries Preservation Act was put into operation to prevent the dumping of glucose. In addition this tariff was imposed in November of 1929. By those means we prevented the influx of American glucose, although the application of the anti-dumping provision did not benefit the Australian glucose industry until the latter part of 1929-30. In that year we imported 7,879 cwt., of which 793 cwt. were supplied by the United States of America, and 6,686 cwt. by the Netherlands. The trade statistics relating to the Netherlands show that in 1929-30 the exports of all Australian commodities to that country were valued at £451,603, and the imports to Australia at £1,134,921. When we stopped the importation of glucose from America we turned for our requirements, not to one of our good customers like Great Britain, Prance or Italy, but to the Netherlands, with which country we had an unfavorable trade balance. The point which I am stressing is that the Australian confectionery manufacturers, to avoid being exploited by foreign interests, were forced into the glucose industry to secure the supply of raw material essential to their industry. That venture has been of substantial benefit to the maize-growers of Australia, and having regard to our adverse trade balance with the two countries which were at the time supplying us with glucose, the Government imposed this protective duty. It has been effective, and therefore must receive the endorsement of this committee.
– I was amazed at some of the statements that were made by my friend, Senator Carroll. That honorable senator is a direct ‘representative in this chamber of the primary producers; yet he made the statement that the manufacture of glucose in Australia has had no effect whatever upon the price of maize or the stability of the market.
– I did not make any such statement.
– That is what I understood the honorable senator to say.
According to the figures that have been given to the committee to-night, the maize used in Australia in the manufacture of glucose is something over 6,000 tons per annum,- while the total production of maize is only something over 7,000 tons per annum.
– The maize produced in the Commonwealth totals 200,000 tons annually.
– That certainly alters the position somewhat; but it does not destroy the argument that I am advancing. If a similar proportion of the total production of wheat were suddenly sought by a buyer for some new manufacturing industry, such an industry would receive the hearty support of Senator Carroll, and of others who are opposing this duty. The demand thus caused does and must have a steadying, as well as a rising influence, upon the market. In the interests of the maizegrowers, there is a tariff on imported maize. I remember well the outcry that was made by the poultry farmers, and certain other primary producers, against the imposition of the duty on South African maize, which was imposed in the interests of our maize-growers. The manufacture of glucose furnishes those growers with one of their principal outlets for their product; yet it is seriously proposed that the duty shall be reduced, and that the manufacturer of glucose shall face intense competition from other countries. The fact that that competition was not present in 1928, or even earlier, is no guarantee that it would he absent if the duty were removed. The report of the Tariff Board, read by Senator Sampson, appeared to me to state one of the most complete cases ever made out by that body in support of the imposition of a very considerable duty. The language which the board used on that occasion was, perhaps, stronger than is to be found in any of its other reports. The objection appears to be that the duty imposed by the Government is higher than that recommended by the board.
– It was bound to be.
– Not necessarily. As the Government has pointed out, the conditions have altered since the board made its report. In that report the competition to which the Australian industry was subjected, the low cost of production in other countries, and the advantage that would accrue to our maize-growers by the maintenance of this industry, were dealt with, and the board then recommended a duty which, in its opinion, would meet the requirements of the case. The Government has made ‘allowance for the altered conditions, and in the interests of the maize-growers, who should be our first consideration, we ought to agree to its proposal.
– The whole question is, whether there is a fair division of profits between the maize-grower and the manufacturer of glucose.
– That is an important question, but not one that we can take into account in considering what duties should be imposed. The maizegrowers themselves should have a sufficiently strong organization to secure an adequate return for the maize that they produce.
– How can they, when the quantity of maize used in the manufacture of glucose represents only one-twentieth of the total production ?
– They can do so to a considerable extent. Action along those lines is taken in connexion with other industries, including the wheat industry. But even if we assume that it is not possible for the maize-growers to protect their own interests in this way, that should not weigh with us in considering the future of an industry and in deciding whether it shall be maintained or allowed to go to the wall. I trust that, in the interests of the maize-growers and of the glucose industry, the item will stand.
– Senator Hays asked whether there was anything like an equitable distribution of profits between the maize-grower and the manufacturer of glucose. It is impossible for the Government to give any such assurance. But honorable senators should not overlook the fact that to-day the maizegrower in Queensland, New South Wales, and Victoria is receiving 2s. 7d. a bushel, although world’s parity is only ls. 10#d a bushel. The matter may best he tested by a comparison of the position to-day with what it was under the Bruce-Page tariff. While the latter operated, the United States of America supplied a portion of Australia’s requirements of glucose, and the present Government had to decide whether it should protect Queensland, New South Wales and Victoria against that country. Is the committee prepared to revert to the Bruce-Page tariff, and to allow the United States of. America to supply Australia with its requirements of glucose, thus driving out of production that section at least of the maize-growers who to-day are meeting this demand? Not one confectioner, brewer, or other user of glucose in Australia has complained by letter, wive, or interview to any member of the Senate, regarding this duty; yet honorable senators are asked to interfere with it capriciously, to humour the lip loyalty to protection of certain members of this chamber.
– There has been no complaint against the duty by those to whom the Minister has referred, because they are all in the swim together.
– Of course they are; and I am pleased that we are in it. with them. When I became a member of this chamber, I was told that the present Government had sold itself to the American moving picture interests. Nobody would grumble to-day if we w;ere to put a prohibitive tariff on American moving pictures, notwithstanding the fact that there is no immediate prospect of our producing our requirements’. But we can produce maize with which we can supply our glucose requirements. Yet it is argued that we must not protect the growers in Queensland, New South Wales and Victoria, and discriminate against our rich uncle overseas!
– What quantity of maize is used in Australia in the manufacture of glucose?
– The figures have left my possession. But whatever the quantity may be, if it is not used in the manufacture of glucose another market will have to be found for it. In one State, 400,000 bushels are used. I was amazed to hear Senator Sampson pooh pooh the smallness of the quantity used. It is not. so long since we spent a whole day discussing the
Tasmanian hop industry. If we shut up our markets what are we to do with the maize? Probably the same as with our butter, we pay 4d. per lb. in order that we may export.
– That was not necessary prior to 1929, when the duty was lower than the present rate.
– The acreage then under production was not so great as at present, and the world parity was lower. Honorable senators cannot blind their eyes to the fact that in this instance the users of the product have not uttered the slightest protest. On the other hand the primary producers appealed to this Government through the agents, admittedly a company in which, they are shareholders, asking that the industry shall be protected so that the United States of America will not have control of the Australian glucose market, which they desire shall be left in the hands of Victoria, Queensland and New South Wales.
– With me, this seems to be simply a matter of which authority Ave are to accept. From the beginning of this discussion I have pinned my faith to the Tariff Board, a body created for the purpose of working out these problems, and advising the Government thereon, and I see no reason for departing from that course now.
– The Tariff Board’s report is four years old.
– And this tariff is two years old. There is no proof that the conditions have altered enough to justify the difference in duty between £15 and £18 13s. a ton. I do not wonder at Senator Duncan getting a bit tied up about these figures, because bushels have been systematically mixed up with tons. Further, I am not a. believer in conclusions which arc worked out on the spur of the moment, or even on parliamentary notepaper, because they are so apt to be tinged by the predilictions of the person working them out. The Tariff Board, which consists of unprejudiced persons, who are experts in these subjects, has thought this matter over, examined a fair number of witnesses of differing opinions, and has come to the conclusion that sufficient protection, shall I say pro- hibition, is given by the imposition of a duty of £15 a ton. Why, therefore, cannot the Government accept for oncethe. advice of those who are by law appointed to be its advisers?
– The Government did not seek the advice of the Tariff Board in connexion with the.gold bounty.
– That is a particularly characteristic interjection from my adroit friend. Always the honorable senator offers the deterrent or the inducement that he thinks will win the case, and thus tries to bluff or tempt those whom he wishes to influence. Had he been in politics as long as some of us have been, goodness only knows what Machiavellian practices he would resort to at this stage of his career. Thinking the matter over dispassionately, I believe that the advice given by the Tariff Board is most acceptable, and suited to the purpose. In the circumstances I find myself impelled to vote for the request that has been put forward by Senator Sampson.
– My remarks will follow partly along the lines of those of Senator Kingsmill
– Do not forget that things have changed since . 1.927.
– I am aware of that, but I remind the Minister and honorable senators that when the Tariff Board made its inquiries into glucose in 1927, it dealt with exactly the same questions as those which the Minister put to the committee this evening. The board had the advantage of hearing evidence from all interested parties. After weighing that evidence, and taking into consideration all the circumstances affecting the industry, it came to a conclusion, and made a recommendation. That was two, not four, years before this tariff came into operation. Senator Daly and another honorable senator made reference to the dumping of glucose into Australia by the United States of America. The Tariff Board examined that aspect of the matter, and embodied in its report a statement showing the average quarterly quotations for maize in the United States of America, together with the domestic prices of glucose supplied by the official representative of the Department of Trade and
Customs, New York, and the landed costs which would have been incurred on importations based on those prices, compared with landed costs of actual importations of glucose into the Commonwealth. The Tariff Board also stated in its report that there had been no dumping on the part of the United States of America. That was in 1927.
– And in 1930 the board recommended the application of section 4 of the Industries Preservation Act.
– We have legislation on our statute-book which enables us to deal with dumping at any time. That has nothing to do with the discussion of this tariff item. In its report, the Tariff Board said -
The reason that the manufacturer in the United States of America is in the position to undercut the Australian price, is due to the favorable position he occupies in respect to the raw material. While Australian maize has cost the local manufacturer from 4s. 7½d. per bushel, the present . price is from 5s. 7d. to 5s.9d. per bushel as against the American price of 4s.1½d. in July, 1925, 3s. 2d. in October, 1925, and 2s.10d.’in March, 1926.
To-day the world’s parity is1s. 10¾d., and the domestic price is 2s. 7d., a difference of 8¼d.
– The difference that existed in 1927 could easily occur again.
– I mention those figures to show that if the present difference in the price of maize had obtained at the time when the Tariff Board made its report, that body would not have recommended so large an increase in the duty. The report concludes -
In view of these circumstances as well as the receding prices and increasing importations of glucose, the Tariff Hoard considers that the Australian industry is in need of furtheir protection and accordingly recommends the present duty of £12 per ton to be increased to £15 a ton.
Senator Kingsmill said that he is prepared to rely on the report of the Tariff Board, which was compiled after hearing evidence from all interested parties, rather than on an ex parte statement by the Minister. I am in precisely the same position. I believe that Senator Sampson is justified in moving his request. I am familiar with the industry, which is now being carried on successfully here, and
I do riot want its future to be jeopardized.
Senator Sir WILLIAM GLASGOW (Queensland) [9.42]. - This discussion has resolved itself into a consideration of what assistance the glucose industry gives to the maize industry. Any one who knows me, will agree that at all times I do what I can to assist that industry. There is no doubt that the quantity of maize used in the manufacture of glucose has an effect on the price of maize, provided that there is no surplus for export. If there is a surplus for export, the amount of maize used in the manufacture of glucose has no effect on the price of the grain. It then comes down to a matter of export parity. In 1928-29 Australia exported 155,842 centals of maize, so that in that year the amount of maize used in the production of glucose had no effect on the price. I should imagine that there will be an export of maize this year, because of its very low price. When considering an item, the Tariff Board hears evidence from all sides. It is difficult for honorable senators to accept a statement from one party or the other, because it may be biased. The evidence given on oath before the Tariff Board on this subject made the position very clear. It must be admitted that the board is in a far better position than honorable senators to determine the measure of assistance that is required. Evidence was taken from all the interests concerned, and it was found that this industry would be adequately protected by a duty of £15 per ton. I shall vote in favour of the board’s recommendation.
– The statement of the Assistant Minister that the tariffs imposed by the previous Government were not effective in protecting the Australian glucose industry is not borne out by the facts. The honorable gentleman must surely have overlooked the official returns. In the five-year period 1925-30 our imports of glucose showed remarkable variations. In 1925-26, when the duty was 12s. per cwt. or £12 per ton, our imports from the United States of America were valued at £22,000. In 1928 the duty was increased to 15s. per cwt., or £15 per ton, and the value of our imports shrank to £8,000. In 1929-30 the imports were valued at only a little over £1,000. The duty imposed by the Bruce-Page Government was operative for only a portion of that year, but it proved to be thoroughly effective. It will thus be seen that the contention of the Minister that the duties imposed by the previous Government were ineffective, was very wide of the mark. Senator Sampson has pointed out that about 95 per cent, of our- glucose requirements are already being provided by Australian manufacturers. The figures that I have quoted show clearly that neither higher duties nor an embargo is necessary to protect this industry. The previous tariff was sufficiently heavy to reduce imports from the United States of America to a negligible quantity.
– Certain honorable senators, including Senator Kingsmill, have argued that, in the absence of more conclusive evidence, the Government should be guided by the report of the Tariff Board as to the degree of protection required for this industry. I point out that, although sub-sections e and / of section 15 of the Tariff Board Act vest in the Minister the power to refer to the Tariff Board for inquiry any questions relating to the necessity for tie granting of bounties or the encouragement of primary or secondary industries in Australia, or for the reconsideration of existing bounties, many substantial bounties have been granted by this Parliament without the making of any such reference to the board. Senator Kingsmill alluded to what he called “ the confusion of authorities “. I do not think that there is any confusion of authorities. This subject was referred to the Tariff Board by the previous Government, which, subsequently, acted upon the recommendations of the board. But, later, the circumstances of the industry altered. Originally the board recommended that a duty of £15 per ton be imposed on glucose; but when it was shown two years later that, notwithstanding the operation of that duty heavy imports of glucose were still being made, the board felt it necessary to recommend that section 4 of the Industries Preservation Act be applied to glucose to prevent the dumping of the American product in Australia.
– Only about £1,000 worth is being imported annually from America.
– I am referring to a time earlier than that mentioned by Senator Lynch, when about 8,000 cwt. out of the total importation of 9,000 cwt. was coming from America. It was in these circumstances that the Government felt it necessary to impose higher duties. We know very well that high duties have been imposed on many classes of imports, not only for protective purposes, but also for the purpose of preventing other countries from dumping their surplus products in Australia. The Government felt it necessary to adopt this policy in regard to glucose, and I intend to support its action.
– It has been shown clearly in this debate that at least 90 per cent. of the glucose requirements of Australia are being manufactured here.
– That is because of the prohibition.
– That may be so; but the glucose is being produced from Australian-grown maize. The questions that chiefly concern me are whether the maize-growers are getting a fair price for their product, and whether a fair distribution of profits is being made between the maize-growers and the glucose manufacturers. I believe that the duty imposed on glucose in 1928 had the effect of encouraging the production of maize, and increasing the manufacture of glucose in Australia., with the result that the maize-growers were put on a somewhat better footing than formerly.
May I say quite frankly, by the way, that 1 do not claim any consistency for my voting on tariff questions. I do not think that any honorable senator can honestly make such a claim. Whether we care to admit it or not, we have a decidedly conscious bias in favour of the industries of the States which we represent. After all, we have been elected to this chamber to represent the interests of our various States, Every honorable senator, I believe, has, at one time or another, endeavoured to secure special protection for the primary and secondary industries of importance in his own State.
I do not think that any one of us has turned a deaf ear to the representations made to us from time to time for protection by way of increased duties, bounties or prohibitions for particular industries.
My sympathy is all with the maizegrowers. Maize-growing may truly be termed a family industry. It provides work for a large number of people, and does not require the investment of much capital. Successive governments and parliaments have encouraged people to engage in primary-producing industries. In these circumstances I intend to give the primary producers the benefit of any doubt I have, as to whether the duty on glucose should or should not be maintained at the present rate. I am not actuated by State considerations on this occasion, for there are no maize-growers in Tasmania ; but I have a desire to assist primary producers generally. I do not think that those engaged in secondary industries should be given the first consideration in every instance. I. shall therefore vote for the proposal of the Government, for I believe that the maize-growers are entitled to this degree of protection. This is an opportunity for honorable senators to give practical assistance to one section of our primary producers. If protection isa good thing, let us distribute its favours to all ‘classes of producers. On other occasions I have asked for and obtained Government assistance for Tasmanian hop, potato, and oat growers, as well as for fruit-growers, in the form of a bounty on the production of evaporated apples, and as I wish to do what I can to assist our small farmers, I intend to vote for the item.
– I also intend to support the Government. This is one of the few tariff items that will give direct assistance to our maize-growers. I have great respect for the members of the Tariff Board, but we must bear in mind that its report upon the glucose industry is now four years old, and much has happened since then. Since the maize-growers on the Atherton Tableland are asking for the continuance of these duties, we mustassume that they are benefiting by this tariff. Senator Foll has stated that the total maize production in Australia is in the vicinity of 8,000,000 bushels. On the basis of 40 bushels to the ton, this represents about 200,000 tons per annum. Senator Carroll also has informed us that about 76 bushels of maize are required to manufacture 1 ton of glucose, the proportion being, roughly, two to one and, as it has been stated that the production of glucose in Australia is S,000 tons yearly, we may safely assume that onetwelfth of our total maize crop is applied to the manufacture of glucose. If we interfere with these duties, Maize Products Limited, which also manufacture other by-products, may go out of existence, and our maize-growers will lose a valuable home market,.-
Senator Sir GEORGE PEARCE (Western Australia) [10.S]. - I cannot resist the temptation to traverse some of the statements made by Senator Herbert Hays, and suggest that, if he expects a quid pro quo, in the form of assistance for Tasmanian potato and oat growers, in return for the vote which he will give upon this item, the Government may have to pay a heavy price for these duties.
– I rise to make a personal explanation. I am aware that the right honorable the Leader of the Opposition (Senator Pearce) is speaking in humorous vein; but, as that will not be apparent to readers of Hansard, 1 take this opportunity to remind him that 1 made no such statement as that which he attributes to me. What I said was that I and other Tasmanian senators had received from the Government assistance for the other primary industries mentioned, and that I intended to support the duties upon this item because they would benefit another section of our primary producers, although maize is not grown to any extent in Tasmania.
– The honorable senator has misunderstood me. I said that his remarks suggested that, he expected support for his advocacy of duties on hops, potatoes, oats, and evaporated apples, in which his State is particularly interested, and that as he did not regard geographical divisions, he was prepared to vote for. this duty on glucose.
– That, remark is unworthy of the Leader of the Opposition.
Senator Sir GEORGE PEARCE.I am not imputing any improper motive to the honorable senator. If he will listen, he will realize that I am merely interpreting what he said.
– I atn surprised that the Leader of the Opposition should attempt to put into my mouth words which I did not use, and that, i» his official position, he should intentionally endeavour to misrepresent me. What J said was that I had previously approached the Government for assistance for primary industries in which Tasmania was interested, and had received sympathetic treatment. I added that J did not claim to be consistent in my vote on tariff items, but, that I intended to support duties on items which, in my opinion, would assist our primary producers.
– 1 accept the explanation. I can assure the honorable senator that I was trying to say what he has now said ; that his remarks were an indication of what he expected from the Government. Will he say that he does not expect, and will not try to get, a duty on potatoes, evaporated apples, hops, and oats?
– There are already duties on those products.
asked the question, “Are the maize-growers going to get a fair share of the benefits of this duty?” and said that he could not answer it. Bui before he sat down he supplied an answer which seemed most logical. He said that when the Tariff Board inquired into the need for an increase of duty on glucose, the price of the raw material was 5s. a bushel. The rate of duty wag then 15s. per cwt. It is now 18s. per cwt., and the maize-grower is getting only 2s. 6d. or 2s. 7-^d. a bushel for the raw material. Senator Herbert Hays may be satisfied that, in the circumstances, the primary producer is getting a fair share of the duty, but now the duty has been increased from 15s. to 18s. per cwt., it seems to me that a fairer distribution to the producer of the raw material would be 6s. a bushel. The present duty is not 75 per cent. - it would bc that if the alteration requested by Senator Sampson were made - but it is now actually a great deal more. As a matter of fact, including a primage duty of 12 per cent., and a surtax of 50 per cent., the total protection at present afforded to the manufacture of glucose is 130 per cent. The primary producer was getting 5s. a bushel for his maize when the duty was 75 per cent. To-day he is getting 2s. 6d or 2s. 7£d. a bushel, whilst the manufacturer is protected to the extent of 130 per cent. I disagree with Senator Herbert Hays. The primary producer is not getting a fair share of the duty, and I propose to vote so to reduce the rate that the manufacturer will not get so much of a rake off, and in the hope that the primary producer will get back to the position he occupied when the rate was 15s. per cwt.
– I hope that honorable senators will not be led into a misunderstanding of the position by the comparison made by. Senator Pearce. If the tariff wall at any given time is 3 feet high, and is then raised to 6 feet, the person inside does not necessarily make twice as much as he made behind the lower wall. At any time the price of the commodity outside may fall, and it may be necessary to build a still higher wall to protect him. The honorable senator might just as easily apply his line of argument to wheat. What was the price of wheat when maize was 5s. a bushel?
– Wheat has nothing to do with the matter under consideration.
– I suppose that it is difficult to get honorable senators to follow any line of argument at this late hour of the night. The question is whether it is reasonable to protect the maize-growers of Queeusland, New South Wales and Victoria against the competition of the United States of America.
– Against £1,000 worth of competition ?
– Of course not. All honorable senators admit that progressive increases of duties have shut out American competition, and made it possible for the maize-grower in Australia to grow the maize necessary for the manufacture of the glucose used in Aus tralia. There is complete harmony in the industry. Not one word of complaint has been heard from any consumer of this commodity. Yet we have been discussing this item for two hours.
– The Minister has taken up a good portion of the time.
– I sun in an unfortunate position. 1 have heard it said by honorable senators opposite that subcommittees have discussed these tariff items. It is, therefore, my duty to try to protect, the Government’s schedule against the concerted onslaughts of different sections of the Opposition.
– Concerted onslaughts! I was not a member of any sub-committee, and I resent that remark.
– I certainly exonerate the President, but the statement about the sub-committees emanated from an Opposition senator and not from myself.
– The Minister is getting most of his support from the Opposition.
– I admit it, and this is one of those occasions when it is necessary for me to see that the support which the small band on the Government benches is receiving is not taken away from it by such statements as those made by the Leader of the Opposition. I trust that the Senate, in the interests of primary production in Queensland, New South Wales and Victoria will support the Government in its attempt to protect glucose made from an Australian product.
– I have been in the Senate for eight years, and have never previously heard an honorable senator wilfully distort and misrepresent another honorable senator’s statement. I leave honorable senators to judge whether the Leader of the Opposition was quoting me correctly, or giving even a fair representation of my remarks on this item.
Question - That the request (Senator Sampson’s) be agreed to - put. The committee divided.
Majority . . . . 3
Question so resolved in the negative.
Item agreed to.
Motion (by Senator Barnes) proposed -
That the Senate do now adjourn.
– I direct the attention of the Assistant Minister (Senator Daly), to the following paragraph which appeared in the Melbourne Herald of yesterday: -
The Minister in charge of Development (Senator Daly), and the Director of Development (Mr. John Gunn), conferred this afternoon with the Prime Minister, Mr. Scull in, on the investigations that Mr. Gunn has lately been conducting into the paper pulp industry in Tasmania. It was agreed that Mr. Gunn should continue his inquiries to enable Senator Daly to present a report to cabinet.
The establishment of the paper pulp industry in Tasmania has been investigated by Mr. Gepp and Mr. Boas, both of whom havestated that the project appears to be economically sound. Unemployment is at present Australia’s greatest problem. We cannot absorb our own population, quite apart from those who may come from overseas. The construction of bridges and underground railways does not add to the absorptive capacity of this country; but the establishment of industries capable of being carried out economically can do so, and make it pos sible for bridges and underground railways to be constructed later. The establishment of this industry and manufacture of paper pulp from timber produced in the northern and southern forests of Tasmania would give employment to about 2,000 men in the bush and in the factories. According to Professor Giblin’s estimate, some 10,000 persons would be profitably employed if this industry were established. The companies concerned do not ask for a bounty, but for relief- from customs duties on machinery and plant. In America to-day there is an over-production of paper pulp, and many Canadian mills have closed down. That being so, there should be every possibility of securing first-class machinery at a reasonable figure. This is not a party matter ; it never has been. The previous Government was keenly alive to the possibilities of the industry, and was prepared to assist it as far as possible. This Government has proved that it realizes the importance of the industry, and is anxious to assist it. The manufacture of paper pulp from eucalyptus wood appears to have passed beyond the experimental stage. I have visited the southern portion of the island in the vicinity of Geeveston, where Mr. Avery has been conducting a good deal of research work, and where the splendid articles produced show that the project is commercially possible. All that is required in the immediate future is a supply of the necessary capital. We all hope that the present financial stringency is now passing and I trust that there is every prospect of this industry being ‘successfully established in the near future. Perhaps the Assistant Minister, who I know is greatly interested in this project, is in a position to make a statement on the subject.
.- The Director of Development (Mr. Gunn) recently visited Tasmania, and, I understand, submitted a report to the Government on the . shale industry. Is the Assistant Minister able to say whether the necessary funds can be made available, or if further inquiries are still being made?
– There is no doubt that in the paper pulp and shale industries the Tasmanian people have two very valuable assets. I am not in a position at the moment to make any statement with respect to the paper pulp industry. I had a conference with the Prime Minister (Mr. Scullin) and the Director of Development (Mr. Gunn), in Melbourne on Monday. As a result of that interview, certain recommendations will be made to Cabinet, and in the meantime Mr. Gunn will continue his investigations. The Government is hopeful regarding the paper pulp industry being successfully established in Australia, and will doall it can to that end.
I think that I nan also give Senator Herbert Hays some encouragement regarding shale oil. The Commonwealth representatives, Messrs. Gunn and Leahey, were favorably impressed with the work which has been done by the company on whose behalf the request has been made. The allocation of funds for the development of the shale oil industry has been transferred to a committee. Mr. Gunn left for Sydney last night, and I expect to hear from him to-morrow. On the adjournment of the Senate to-morrow, I hope to be able to announce the verdict of the committee. I sincerely hope that it will see its way to make an amount available, because the development of the shale oil and the paper pulp industries will increase the capacity of the Commonwealth to absorb population.
Question resolved in the affirmative.
Senate adjourned at 10.32 p.m.
Cite as: Australia, Senate, Debates, 24 November 1931, viewed 22 October 2017, <http://historichansard.net/senate/1931/19311124_senate_12_132/>.