Senate
2 June 1933

13th Parliament · 1st Session

  1. Senate
  2. 13th Parliament
  3. 1933

The President (Senator the Hon. F. J. Lynch) took the chair at 11 a.m., and read prayers.

page 2054

QUESTION

GOVERNMENT TARIFF POLICY

Statements by Senator Hardy and Sir Henry Gullett.

Senator CARROLL:
Western Australia

. -by leave - I desire to refer to the debate that took place yesterday, in the course of which Senator Hardy made certain statements implicating the ex-Minister for Trade and Customs (Sir Henry Gullett). A statement is published in this morning’s issue of the Canberra Times in which Sir Henry Gullett denies the truth of what Senator Hardy said. As it was stated yesterday that two Country party senators were members of the deputation, the implication is that we were endeavouring for some reason of our own, to misrepresent what took place.When Senator Hardy was speaking yesterday, he used the words, “ private deputation “. That was the first time that I knew that the deputation was of a private nature. The deputation was arranged by Senator Sampson, and, so far as my memory serves me, it was held just prior to the departure of the Australian delegation for Ottawa. There had been considerable uncertainty as to the Government’s intention in regard to the tariff, and Senator Sampson’s idea was that a number of us should wait upon the Minister for Trade and Customs and ask him for a definite statement of the Government’s real intentions. So far as Iknow, there was no pre-arranged deputation. Senator Sampson asked any honorable senator who desired to go along with him to do so. I knew nothing about the deputation until a few minutes before it was due to meet the Minister. I went along, and so did Senator Johnston and Sir Hal Colebatch. Speaking from memory, there were twelve or fourteen sena-‘ tors in the room. Sir Henry Gullett quite naturally said that he could not make a statement of the nature desired until after the Ottawa Conference, but after he had given his official answer to the request that had been made to him he became expansive, and, without any provocation or inducement whatever, launched out and made a statement substantially in accord with Senator Hardy’s statement yesterday. It gives me very great pain to have to say, .as I do definitely and with a full knowledge of what T am saying, that Sir Henry Gullett’s denial of what took place at the deputation is not correct. I exceedingly regret having to make this statement, because I have been bracketed, during the last two elections, with two Nationalist colleagues in the Senate team for Western Australia, and I want to bear witness that no man could have had fairer or more honorable team mates than I had. I was treated by them with the greatest courtesy and confidence. I cannot too strongly deprecate the efforts that are being made to cause differences between the Country party and the United Australia party. I believe that I am correct in saying that T have friends in every political party represented in this chamber. We agree to differ politically. But I cannot sit clown under the imputation that I have been responsible for the making of a false statement for the purpose of causing trouble. It was only shortly before Senator Hardy made his speech that I knew that he intended to touch upon that deputation. He came to me and said, “I have such and such facts. You were at the deputation. Are the statements that I intend to make substantially correct?” I said that they were. I make ‘this statement without any desire to injure anybody, but with the object of defending myself from the implication that I was a party to the making of a false statement as to what took place.

Senator Hardy:

– The honorable senator’s statement completely justifies me.

page 2055

QUESTION

LONDON CONVERSION LOAN

Senator HARDY:

– Will the Minister representing the Treasurer inform the Senate of the total amount of money subscribed in the recent conversion loan launched in London; and, also, of the intention of the Government in the allocation of any moneys that may have been over-subscribed ?

Senator GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– The position in regard to loans floated in London is that if the cash subscriptions are in excess of the amount required, securities are issued to the subscribers in proportion to the amount of their subscriptions. TinGovernment has no power to do other than this. The loan is raised for a specific sum, and over-subscriptions of cash can only be dealt with on a proportionate basis.

page 2055

QUESTION

SENATOR MASSY GREENE

Birthday Honours - Resident Minister in London.

Senator RAE:
NEW SOUTH WALES

– Can the Leader of the Senate take honorable senators into his confidence and inform them whether there is any truth in the rumour that a high honour, such as that of Knighthood, is to be conferred upon Senator Greene on the recommendation of the Federal Government to the Imperial authorities, and that the announcement of it will appear in the Birthday Honours list? I should also like to know whether it is the intention of the Government, that Mr. Bruce, the Resident Minister in London, shall return to Australia at an early date, and Senator Greene be sent to London as Resident Minister?

Senator Sir GEORGE PEARCE.Honorable senators are well aware that the matter referred to in the first part of the honorable senator’s question is confidential to the Prime Minister, the GovernorGeneral, and His Majesty the King, and is not discussed or referred to in public statements. As to the second part of the honorable senator’s question, when any change of the nature suggested by him has been decided upon, a statement will be made in the ordinary way by the Prime Minister or some other member of the Government.

page 2056

QUESTION

HOURS OF WORK

Senator DUNN:
NEW SOUTH WALES

– Has the attention of the Leader of the Government been drawn to a report published in to-day’s issue of the Canberra Times to the effect that Chief Judge Dethridge, of the Arbitration Court, has said that the working week of 48 hours will eventually be considerably reduced? Is the Government prepared to introduce a 36-hour working week throughout Australia for both primary and secondary industries, with a view to coping with the acute unemployment problem, and, if so, will it provide that the full basic wage, with margins for skilled workers, shall be paid for such 36-hour week?

Senator Sir GEORGE PEARCE:

– have seen the report referred to by the honorable senator, but I remind him that it is not usual to make statements of policy in answer to questions.

page 2056

QUESTION

WIRELESS BROADCASTING

Proposed A Class Station at Katanning.

Senator E B JOHNSTON:
WESTERN AUSTRALIA

asked the Minister representing the PostmasterGeneral, upon notice -

With reference to the statement, made in reply to a question by Senator Johnston in the Senate on the 29th September last, that tenders for the erection of a new class A broadcasting station, approved for erection at Katanning, Western Australia, would be called within a few weeks -

  1. What is the cause of the delay in calling tenders, as promised?
  2. When will the erection of the proposed new station be commenced?
Senator McLACHLAN:
Minister in charge of Development and Scientific and Industrial Research · SOUTH AUSTRALIA · UAP

– The replies to the honorable senator’s questions are as follow: -

  1. The main cause of the delay has been due to the necessity for undertaking certain preliminary research into matters affecting vital technical considerations.
  2. It is impossible to fix any date, but the department is specially anxious that this work should be expedited as far as practicable.

page 2056

QUESTION

LIAISON OFFICER IN LONDON

Senator DUNN:

asked the Minister representing the Prime Minister, upon notice - 1.Is it a fact that the Government has appointed Mr. Keith Officer, at present a temporary clerk in the External Affairs Department, to the position of liaison officer in London, at a net remuneration of £800 a year?

  1. If so, why has this appointment been made if it is a fact that there are permanent officers at Australia House and in Australia who are competent to fulfil the duties associated with the position of liaison officer ?
  2. If the appointmenthas been made, why did the Government wait until another place was in recess before making it?
  3. What political association has Mr. Officer with members of the Lyons Cabinet, and is he a member of the New Guard?
  4. When will Mr. Officer leave Australia, and will he travel first or second class ?
Senator Sir GEORGE PEARCE:

– The replies to the honorable senator’s questions are as follow: -

  1. Mr. Frank Keith Officer has been appointed by the Public Service Board of Commissioners to the position of External Affairs Officer (London), Department of External Affairs, annual salary £582 (actual amount after reduction in accordance with the Financial Emergency Act, £491). He will also be paid the allowance attached to the position, which will make his total remuneration £729 per annum.
  2. The Public Service Commissioner advises that there was no officer within the Service as capable of filling the position.
  3. The appointment was made by the Public Service Board of Commissioners on 24th May, and was notified in the Commonwealth Gazette in ordinary course.
  4. Mr. Officer has no political association with members of the Cabinet. I see no reason for inquiry of Mr. Officer whether he is a member of the New Guard, but he has voluntarily given the assurance that he is not a member of that body.
  5. First class, in accordance with the provisions of the Public Service Regulations.

page 2056

QUESTION

CUSTOMS REVENUE

Senator RAE:

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

Will the Minister supply, for the information of the Senate, a statement showing -

The amount of customs revenue, month by month, collected since the signing of the Ottawa agreement up to 30th April, 1933;

The amount of customs revenue, for the same number of months, shown month by month prior to the signing of the Ottawa agreement?

Senator GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– The Minister for Trade and Customs has supplied the following answers: - (a)-

(b)-

page 2057

QUESTION

NEWNES SHALE OIL-FIELDS

Senator DUNN:

asked the Minister in charge of Development, upon notice -

Will the Minister inform the Senate -

How many men are actually employed at the Newnes shale oil-fields (Wolgan Valley) ;

How many unemployed are on the Newnes and Capertee shale fields at present;

Are any steps being taken to expedite the absorption of the unemployed;

Has an industrial agreement been concluded to protect the wages and conditions of the men employed under the joint agreement between the Commonwealth and State Governments ;

Is it a fact that unemployed miners in the Wolgan Valley have to travel seventeen miles to receive the dole, and have any representations been made to the administration at Newnes to ask the State Government for the location of a dole depot at Wolgan?

Senator McLACHLAN:
UAP

– The answers to the honorable senator’s question are as follow: -

  1. Eleven men are at present employed on a full-time basis by the Newnes Investigation Committee in cither the Wolgan or Capertee Valleys at Newnes in connexion with the investigations which are being conducted. In addition, a certain amount of casual employment is provided as occasion arises.
  2. As unemployment relief measures are administered by the State, I am not in a position to reply to this question.
  3. The Newnes Investigation Committee is employing the maximum number of men required to conduct its investigations expeditiously. The absorptive possibilities of Newnes in the future will largely depend upon the results of investigations now being conducted by the Newnes Investigation Committee.
  4. Negotiations in this regard are at pre sent taking place.
  5. I am not aware that recipients of un employment relief in the Wolgan Valley have encountered difficulty, due to isolation, in the collection of such relief, nor have any representations been made to the Newnes Investigation Committee in this regard.

page 2057

QUESTION

RESEARCH WORK IN TASMANIA

Senator SAMPSON:
TASMANIA

asked the Minister in charge of Development, upon notice -

  1. Did Professor A. E. V. Richardson, Director of the Waite Agricultural Institute, visit Tasmania recently for the purpose of investigating research matters there?
  2. What were Professor Richardson’s main recommendations, and what action, if any, is it proposed to take in regard to them?
Senator McLACHLAN:
UAP

– The answers to the honorable senator’s questions are as follow: - -

  1. At the request of the Government of Tasmania, Professor A. E. V. Richardson, Director of the Waite Agricultural Institute and Member of the Executive Committee of the Council for Scientific and Industrial Research, visited Tasmania in February last for the. purpose of conferring with officers of the Tasmanian Department of Agriculture with a view to formulating proposals for the future conduct of scientific research in Tasmania.

  2. Professor Richardson’s main recommendations were -

    1. That a permanent central research station for the continuous investigation of problems confronting Tasmanian agriculture would be of great value for developing the agricultural and pastoral industries of the State. In this regard Professor Richardson pointed out that Tasmania is unique among the States of the Commonwealth in that it lacks those research and educational facilities in agriculture which are regarded as essential for the progressive development of a State’s agricultural resources. Unlike the mainland States, Tasmania has neither a school of agriculture at the University for the training of teachers, research workers, and specialists, required for the advancement of the agricultural interests, nor an agricultural college for the vocational training of agriculturists. Nor, indeed, has it an experimental or research station on which investigations may be conducted for the development of the agricultural industries. Professor Richardson, therefore, suggested that consideration be given to the question of establishing a research station which might with advantage be located in the Launceston district.
    2. That, although the possibilities of cooperation between the Council for Scientific and Industrial Research and the Tasmanian Department of Agriculture are limited mainly by lack of funds and lack of facilities for research, immediate and urgent needs might be met by the appointment of a full-time entomologist, and a veterinary pathologist, the cost of such services being shared equally by the two governments. These officers would, in the main, deal with entomological problems, such as the underground grass grub and the lucerne flea, and veterinary problems, including pregnancy paralysis (twin lamb disease), pulpy kidney, fluke and foot rot.

The question of the establishment of a permanent central research station is a matter for the Government of Tasmania. Following on representations which I made personally to the Council for Scientific and Industrial Research, the Council undertook to give the fullest consideration, bearing in mind, limitations as to funds, to methods by which the entomological and veterinary problems mentioned by Professor Richardson, might be dealt with on co-operative lines. In this regard discussions are at present taking place between the Council and the Minister for Agriculture of Tasmania andofficers of the Tasmanian Department of Agriculture.

page 2058

QUESTION

EXCHANGERATE AND PRIMAGE DUTY

Tariff Board’s Report

Senator E B JOHNSTON:

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

  1. As the Minister has indicated that he has received the report of the Tariff Board on the important question of the protective incidence of exchange and primage duties, when will such report be available to the Senate?
  2. Is it the Government’s intention to ask the Senate to proceed with the consideration of the tariff in the absence of the important information which the said report should contain?
Senator GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– The Minister for Trade and Customs has supplied the following answers: -

  1. The report of the Tariff Board on primage and exchange is of a most comprehensive and important character, and is now being considered by a sub-committee of Cabinet.
  2. Yes.

page 2058

QUESTION

NEW GUINEA

Ministerial Visit: Opening of Legislative Council

Senator HARDY:

asked the Leader of the Government in the Senate, upon notice -

What is the total gross expense of the recent trip of the Honorable C. W. C. Marr to New Guinea and the Mandated Territory?

Senator Sir GEOEGE PEARCE.The information desired by the honorable senator will be supplied as soon as it is available.

Senator MacDONALD:
QUEENSLAND

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

  1. As I was one who made inquiries at the time regarding the opening of the Legislative Council of New Guinea, and the attendance of members of the Commonwealth Parliament, will the Minister inform me were invitations extended, or special facilities offered, to representatives of the Opposition in the Senate or another place to be present at this important function?
  2. If not,. why not?
Senator Sir GEORGE PEARCE:

– The Minister for External Affairs has supplied the following answers: - 1 and 2. No invitations to persons in Australia to attend the opening of the Legislative Council for New Guinea were issued. It was, however, considered by the Government to be desirable that, in view of the importance of the occasion, the Minister administering the affairs of the territory should be present, and arrangements were made accordingly.

page 2058

DAY OF MEETING:

Motion (by Senator Sir George Pearce) agreed to -

That the Senate at its rising adjourn till Tuesday next at 3 p.m.

page 2058

CUSTOMS TARIFF MEMORANDUM

Motion (by Senator McLachlan) agreed to -

That, for the information of the committee, the Customs Tariff Memorandum, which was laid on the Table on the 1st June, 1033, be referred to the Committee of the Whole on the Customs Tariff Bill.

page 2058

AUSTRALIAN ANTARCTIC TERRITORY ACCEPTANCE BILL

Third Reading

Bill (on motion by Senator Sir George Pearce) read a third time.

page 2058

CANNED FRUITS EXPORT CONTROL BILL

Second Reading

Senator McLACHLAN:
Vice-President of the Executive Council · South Australia · UAP

– I move -

That the bill be now read a second time.

The principal object of this measure is to bring pineapples within the scope of the activities of the Canned Fruits Export Control Board. Pineapples are canned exclusively in Queensland. Production has increased from 155,000 cases in 1925-26 to the present average annual output of approximately 200,000 cases. Until 1931, the domestic market absorbed practically the whole of the pack, and the necessity for export, therefore, did not arise. Increased production in recent years, together with decreased consumption, due to the prevailing economic conditions and more active competition from other varieties of canned fruits, have resulted in an exportable surplus. The packing of all canned pineapples is controlled by the Committee of Direction of Fruit Marketing - a State instrumentality constituted under the Queensland Fruit Marketing Organization Acts 1923-1930. Each year, the committee makes arrangements with canners, both for the processing of the fresh fruit, and for the disposal of the canned product. The committee is also the actual owner of a large portion of the pack. The producers are financially assisted by the Fruit Sugar Concession Committee, which guarantees them against any loss on the sale of their produce overseas. This committee was set up under the sugar agreement between the Commonwealth and the Queensland Governments, and is responsible for the disbursement annually of a substantial monetary grant contributed by the sugar industry for promoting the use and sale of manufactured fruit products. The Canned Fruits Export Control Act provides for the regulation by the Canned Fruits Control Board, which has been constituted under that act, of the overseas marketing of canned apricots, clingstone peaches, pears, and such other canned fruits as are prescribed. It is proposed in the amending bill that the overseas marketing of canned pineapples shall also be brought within the scope of the board’s activities. Although this could have been achieved by the passing of a regulation, it is considered that it should be included as an, amendment of tile act, in view of the desirability of giving effect to a further amendment, which cannot be done by regulation, with the object of according the pineapple interests separate representation on the board. The inclusion of canned pineapples in the provisions of the Export Control Act is approved by the Canned Fruits Control Board, and is strongly supported by the Committee of Direction of Fruit Market ing, Queensland, the Fruit Industry Sugar Concession Committee, and the only establishment in Queensland which is at present regularly engaged on the processing of pineapples for export. There is an exportable surplus of approximately 100,000 cases per annum, and if growers are to find an outlet for their crops, it is essential that an overseas trade in this product be established and developed. To assist in this direction, the Committee of Direction desires to take advantage of the overseas organization and trade contacts which have been successfully established by the Canned Fruits Control Board. This board at present consists of four members, three of whom are chosen by the producers in the various sections of the industry, and the remaining member is appointed by the Governor-General, as the representative of the Commonwealth Government on the board. The bill provides that an additional member shall be appointed by the Governor-General as the representative of the canneries engaged in the production of canned pineapples, and that such member shall be nominated by any authority constituted under any State Act for the purpose of controlling the marketing of canned pineapples. Al present the only authority eligible to nominate a representative of. the industry is the Committee of Direction of Fruit Marketing, Queensland.

The remaining provisions of the bill are purely of a .machinery nature, and are consequential to the principal amende ments. Administrative and other expenses of the board are met by the industry, by means of a levy of Id. on every dozen tins of canned fruits which are exported. A considerable portion of the board’s funds is devoted to advertising Australian canned fruits abroad; in this direction it works in close cooperation with Mr. A. E. Hyland, the Director of Australian Trade Publicity in Great Britain. Since its establishment, the board has been recognized by successive governments as the mouthpiece of the industry in respect of all matters pertaining to the export of canned fruits. Through its activities, undesirable elements and practices previously associated with export marketing, par.ticularly in Great Britain, have been eliminated. The exports of canned peaches, apricots, and pears, have increased from 113,000 cases in 1925 - the year prior to the board’s establishment, and one in which the exports were heavily subsidized by the Commonwealth Government - to 662,000 cases in 1932, and the board has eliminated price competition between Australian interests in export markets, and has ensured full market returns to exporters and orchardists. The- United Kingdom and Canada are the two most promising markets for Australian canned pineapples, and in these countries the board is in close contact with distributors and the market generally. In Great Britain, the board has its own representative, who ;8 assisted by an advisory committee comprising the agents of Australian exporters of canned fruits. A similar committee has been established in Canada under the chairmanship of the Australian Trade Commissioner in that dominion. In view of the unanimity among the various interests concerned, I confidently commend the bill to the favorable consideration of honorable senators. Should any further information be desired, it can be given in committee. The bill is, however, chiefly- of a machinery nature ; its principal objects are to include pineapples among the- fruits covered by1 the prin cipal act, and to give the growers of pineapples representation on the board. The matter is of some urgency, as I under stand that the canning of pineapples is now being proceeded with in Queensland.

Debate (on motion by Senator Barnes) adjourned.

page 2060

CUSTOMS TARIFF 1933

First Reading

Debate resumed from the 1st June (vide page 2054). on motion by Senator McLachlan -

That the bill be now read a first time.

Upon which Senator E. B. Johnston had moved by way of amendment.

That all the words after “ be “ be left out with a view to insert in Heu thereof the following words : - “ returned to the House of Representatives with a request that the House will so amend the bill that the terms ‘and the spirit of the Ottawa agreement shall be given effect to in so far as concerns the British preferential duties referred to in the bill, that is to say, will so amend the bill”” that the proposed duties against British goods shall be reduced to the level of the 1921-1930 tariff in all cases where they have been raised above that level without report by the Tariff Board.”.

Senator J B HAYES:
Tasmania

– In framing the tariff policy of a country, the first thing which ought to be considered is the nature of the industries for which that country is most suited. If its chief industries are primary industries, and it is necessary to export large quantities of primary produce in order to pay for its imports, and leave a surplus to meet its overseas liabilities, the tariff should be low. If the cost of living is low the . cost of production can be kept down. Australia must export large quantities of primary products and therefore, its primary producers should be given every possible assistance. In my opinion, the best way of assisting them is to free them from restrictive legislation which raises their cost of production. In the Commonwealth such legislation is contained in the arbitration laws, the Navigation Act, and the tariff. To-day we are dealing with the tariff. I believe that it is too high, and that a reduction would be of great assistance to our primary -industries. In order to escape from the depression which afflicts us, every section of the people should make some sacrifice, but, unfortunately, it is the primary producers who make most of the sacrifice to-day.

Senator Collings:

– Nonsense !

Senator J B HAYES:

– I do not under-estimate the value of our secondary industries; but I submit that they, like our primary industries, should be built up by hard work, and not prosper at the. expense of the rest of the community. In the boom period which followed the war, Australia was fortunate in possessing many things which the world needed. The prices of such commodities were high, and Australia benefited accordingly. Our primary producers were paid well for their products, and wages, therefore, became higher. No one objected to high wages then, because it was easy to pay them; but, later, owing to overproduction, or, rather to under-consumption in the importing countries, the prices of our primary products fell below normal, whereas many of the things required by the primary producers cost double what they did before. We have been told that the fiscal policy of the Government will assist the primary producers of this country. I want to show that it will not do so. I have not searched the records for instances of the harmful effect of the tariff, although had I done so I could, no doubt, have found numbers of examples; I prefer to tell the Senate of cases which have come under my own observation. I know a farmer in Tasmania who recently bought a windmill in order to obtain water for his stock. By the time he had completed its erection, it had cost him, with appurtenances, £48.

Senator O’Halloran:

– The dimensions of the wheel largely determine the cost of a windmill.

Senator J B HAYES:

– I know that a big windmill costs more than a small one; but that is not my point.

Senator O’Halloran:

– Not long ago I erected a windmill and tank complete for £32.

Senator J B HAYES:

– The windmill referred to was not better than one which the farmer had bought some years ago for £24. If we were to trace that windmill back, we should find that at every stage of its manufacture the wages and conditions of the workers concerned were protected by law. The miners who mined the ore and those who smelted it had the protection’ of the Arbitration Court, as had also the railway workers who handled the product at different stages. The men on the ships which conveyed the ore to the smelters and the windmill to Tasmania were protected by the Navigation. Act. Every person who handled that windmill at any stage of its manufacture was given a fair deal by law. But the farmer who bought the windmill was not protected. He had to pay for the protection afforded to others, notwithstanding that the things that he had for sale were forced to face world competition or low local prices. Without reaping any compensating advantage, he was compelled to contribute a large sum to those engaged in the secondary industries associated with the manufacture, transport, and erection of his windmill. The duty on the windmill was 45 per cent. British, and 55 per cent. foreign, plus exchange and other charges. The exchange to Britain was about 25 per cent., and to foreign countries, from 60 per cent. to 70 per cent.

Another farmer among my acquaintances, who also engages in dairying, erected some division fences in order to enable him to improve his pastures. Some years ago, he erected one mile of subdivision fencing and, recently, a further mile of similar fencing. He is a methodical man, who keeps proper accounts of his receipts and expenditure, and he told me that the second mile of fencing cost him £5 14s. more than he paid for the first mile erected, the difference being due to federal legislation. It is fair to assume that the wire he used came from Newcastle, where everything is flourishing, because the men there are in receipt of fair wages, and enjoy the protection of the tariff. I do not know what Newcastle company made the wire used in the fences on this man’s property, but I know that the shares of the biggest manufacturing company there have doubled in value in a few months, and that the company has paid a dividend of 10 per cent. The man who bought that wire cannot make 1 per cent. on his outlay. He has to sell his butterfat to. the factory at the ruinous price of 7½d. or 8d. per lb.

Senator O’Halloran:

– He probably was not credited with the full butter-fat content.

SenatorJ. B. HAYES.- I do not think the factories which bought his butter-fat were dishonest. They were consigning their butter to London, where there was a falling market, and they could not pay more for it.

Senator O’Halloran:

– What about the 4d. per lb. bounty.

Senator J B HAYES:

– The Paterson scheme was taken into account in the 7½d. per lb. which he received. Had that man and his wife and family been paid the award rates which were paid to the men who made the wire, he would have received 2s., instead of 7½d., for each lb. of butter-fat.

Senator Collings:

– He ought to have received award rates.

Senator J B HAYES:

– There is no method by which that could be done.

Senator Collings:

– That is because society is conducted according to the plan approved by the honorable senator.

Senator J B HAYES:

– The primary producer has to take for his products whatever he can get in the world’s markets, where the price is determined by the operation of supply and demand, whereas his costs are determined by legislation passed in Australia. Freedom from the restrictions imposed by that legislation would be of tremendous benefit to everyone connected with primary industry. But, unhappily, all sections of the community are not pulling their weight.

In another place, there was a long discussion on the cost of mowing machines and horse rakes, and the English and Australian costs of such machines were compared. I do not want to deal with the subject from that stand-point, but I point out that especially in Tasmania, where the primary producers have gone in for pasture improvement, mowing machines and horse rakes are necessary; every farmer has to have a mowing machine to cut the surplus grass in the spring-time, and a rake to gather it for use in other seasons. Sixteen or seventeen years ago, a mower and rake cost £30, whereas I was informed last week by a machinery agent in Launceston that precisely similar machines now cost £55 - nearly double the price. These machines are subject to duties of 30 per cent. British, and 45 per cent, foreign, yet stockowners make less profit to-day than they did sixteen or seventeen years ago. While I was in the store, inquiring about the price of mowing machines, I noticed some ordinary No. 10 ploughshares, which we used to buy for 4s. 6d. or 5s. each. About six months ago the price was 13s. 6d. each, and I am informed that these articles are quoted at 17s. 6d. each. The duties on ploughshares are 20 per cent. British and 35 per cent, general. On reapers and binders, which formerly cost £38, the duties are 30 per cent, and 45 per cent, respectively. These machines are chiefly used for cutting hay, and the price to-day is nearly double what it formerly was. In Tasmania, hay at the stack is now fetching 30s. a ton, which is an unprofitable price. Farmers have to sacrifice their hay; but, when they buy the machine with which it is harvested, they have to pay twice as much as formerly. The position in regard to butter is much the same. Dairy utensils, made in Great Britain, are on the free list; but the prices of these articles have risen, and quite recently the duty on any goods from foreign countries has beer made 15 per cent, higher than the British rate. Because of the glut of butter in England, farmers in Tasmania have to accept 7½d. per lb. for butter fat, and that price is not profitable to them.

Senator BROWN:
QUEENSLAND

– Why not fix a higher local price?

Senator J B HAYES:

– That has been done to a slight extent. I believe that the prices of the things that farmers have to buy should be reduced, to enable Australia to compete with the rest of the world.

In Tasmania, the farmers have practised pasture improvement, and many of them are now carrying twice the number of stock that they formerly depastured. This result has been brought about by top-dressing the soil with superphosphates, and growing better grasses; but it has become increasingly apparent that nitrogenous fertilizers are necessary, and one of the best of these is sulphate of ammonia. When I was in Launceston a few days ago, I found that the local price of this commodity, which is £6 10s. in England, was £13 per ton. This fertilizer is used for promoting the growth of succulent fodder for dairy stock. Although the Australian producer pays twice as much for it as do his competitors overseas, he has to ship his butter to London, and compete in the markets of the world. It is an unequal fight. Land suitable for small dairy farms can be purchased to-day, in many cases, for less money than has been spent in clearing it. Notwithstanding my respect for the secondary industries, I must say that the tariff operates directly against the interests of the primary producers, and an alteration will have to be made.

Take another branch of primary production - timber. In 1929, 5-in. x 1-in. flooring boards, green off the saw> and delivered at the yards for stacking and seasoning, were sold at 23s. 6d. per 100 super, feet. This is a standard article, and Tasmania produces the best flooring timber in the world. To-day these boards can be purchased for 15s. per 100 super, feet, or less, the price having fallen by considerably over 33 per cent. A similar remark applies to other timber. I have obtained my figures from a reputable miller, and have verified them as far as possible. A circular saw of the type ordinarily used by a saw-miller formerly cost £4 10s. ; but the present price is £9, and the duties are 45 per cent. British, and 60 per cent. general. In addition to the duty, there is 25 per cent. exchange, which means that about 70 per cent. is added to the cost of the article that the miller has to buy to enable him to cut his timber. One honorable senator has told us that in connexion with a purchase of £20,000 worth of machinery, he had to pay no less than £13,000 in duties. How can a saw-miller hope to make a living in such circumstances? A vertical saw that formerly cost from 8s. to 10s. per foot now costs 14s. 6d. per foot.

Senator O’Halloran:

– What is the duty on sawn timber?

Senator J B HAYES:

– We must have a duty on sawn timber, and I refuse to vote against any duty on primary produce, while the duties on secondary manufactures are so high. The primary producers of Tasmania have been reduced to their present position because of the depression, the effect of the Navigation Act, the Arbitration Acta, and the exorbitant tariff. A cross-cut saw which formerly cost 3s. 3d. per foot now costs 5s. 6d. per foot. American axes, which were formerly 5s., are priced at 12s. 6d. The price of axe handles has gone up from1s. to 4s. 6d. each.

Senator GREENE:
Assistant Minister (Treasury) · NEW SOUTH WALES · NAT

– Are not cross-cut saws admitted free?

Senator J B HAYES:

– I should not be surprised if British saws were. The duty on foreign saws, however, has been increased by 15 per cent. Although are admitted free, the price has gone up several shillings on account of the operation of the 15 per cent. British preference under the Ottawa agreement. That increase actually amounts to 20 per cent., or 25 per cent. by the time the producer had paid for the article. Fern hooks are used on nearly every farm situated in scrub country. I have bought them for 3s. 6d. and 4s. each, but two years ago the price increased to 5s. 6d. each. Today, they cost 9s. 6d. each in the cities, and in country stores the price is from 10s. to11s. each. The duties on these hooks are 35 per cent. British, and 55 per cent. general.

Senator Hoare:

– What about the exchange rate?

Senator J B HAYES:

– I recognize, of course, that the exporter gets the benefit of the exchange Tate. The importer and the person who buys the goods lose as the result of the exchange; but this is a direct protection to the manufacturer, and it should be considered in computing the duty. I have shown that the prices of nearly everything that the farmer has to buy ‘have doubled, while the prices received by him for his produce have fallen tremendously. The cost of the household requisites purchased by the man on the land has risen to practically the same extent as farm requisites. Seven pounds of greasy wool will make a suit of clothes, and this quantity of wool is not worth more than 7s. in the market. Yet the farmer has to pay £7 or £8 for a suit of clothes. If we trace that wool from the sheep’s back to the finished article, we see that everybody who handles it, except the man who grows it, is protected by law. There will be nothing but unrest until the fiscal and industrial policy of this country has been altered.

The position of country people to-day could not be worse. I do not know what the farmers will do this winter. In my own electorate, they have had great difficulty in scratching along, with butter at 7½d. or 8d. per lb. during the summer, but during the winter months with no cheques coming in from the butter factories, it is hard to say what they will do. The position is dangerous. The farmers are either living on their capital and exhausting their savings, probably selling the few remaining bonds they have bought in good times, or they are getting deeper into debt, which is more frequently the case. Failing that, they are doing what is worse - neglecting the maintenance of their holdings. One can see fences tumbling down, buildings that require to be straightened up, and scrub that ought to be cut. The farmers are forced to neglect the maintenance of their holdings and the standard of their stock. Breeders say that they cannot sell their stud stock, because the men who would like to buy it have not the money with which to pay for it. The farms are over-run with blackberries, suckers and ferns. This is a direct incentive to unemployment; but there .should be no unemployed in the country districts to-day. Plenty of work that ought to be done is available, and it would be put in hand if the producers had the financial resources necessary to enable them to have it done. But their profits do not enable them to carry out necessary works, and this means deterioration and slow ruin. Australia has more sheep to-day than ever before, but thereare also more rabbits. If we experienced a drought, which we cannot hope to escape much longer, disaster would overtake this country. The farmers simply cannot pay their debts. The payment of interest is out of the question. I realize that the interest rate is too high; but interest is not being paid, because the man on the land positively cannot pay it.

The wool-grower has developed his industry without protection. The Australian pastoralist is the most efficient wool-grower in the world. He raises sheep of the best type, and produces wool of the best kind, yet he is doing it at less than the cost of production, because the prices of all the things which he has to buy have been raised. The wheatgrower is also highly efficient. He has produced wheat on land on which it was considered impossible to grow it. This has been done, not with tie help of the tariff, but in spite of it. But the wheatgrower is right up against it. Some farmers are even talking of abandoning their land, on which thousands of pounds have been spent, because it does not now pay to grow wheat. The dairymen have improved their pastures, and have done as much as possible in the direction of improving the quality of their herds ; but they have to pay exorbitant prices for everything they require, and butter fat is down to the ruinous price of 74d. per lb. On the basis of the values that ruled twenty years ago, that 7-Jd. per lb. is not equal to 4d. per lb., and it cannot be made payable except by the performance of a substantial proportion of the work by the wives and families of the dairymen. If they were given the wages and conditions that operate in the factories, the price of butter would be from 2s. to 3s. per lb. The fruit-growers are in a similar plight. Wherever one travels in the country districts of Tasmania, one hears the complaint that costs are too high, and is asked when the tariff is to be lowered and the conditions of earlier years are likely to return. This country cannot get back to a normal state so long as it has one of the highest tariff -walls in the world. That wall has been raised consistently year by year. Customs duties are fixed on the basis of what it costs to produce goods under Australian conditions in regard to wages and labour,* and those conditions are fixed by the Arbitration Court on the basis of what it costs to live, without due consideration being paid to the value of the completed article. The cost of living is largely controlled by the tariff, and, as a consequence of the continual raising of duties, the primary producers, who have to sell their products in the markets of the world, are becoming poorer and poorer. It is time that a sten in the other direction was taken, so that they might have a chance to recover. The tariff policy is producing a very bad feeling throughout Australia, but particularly in the smaller States. The unrest, discontent, and poverty in Western Australia, South Australia, and Tasmania are growing, and if that continues at the present rate, the position will become desperate and dangerous. ‘Anything that I can do to reduce the tariff, and to lift the weight that is pressing with such severity on the primary producers, I shall do most cheerfully.

Senator PAYNE:
Tasmania

– I appreciate highly the remarks of my colleague from Tasmania (Senator J. B. Hayes), especially after the fulminations of certain honorable senators, who appear to consider it their province to do nothing except denounce the Government and to charge it with the responsibility for all the ills which Australia is suffering. Australia has arrived at the crossroads, and instead of abuse being levelled by one against another, all should cooperate in searching, for means of relieving the existing distress. I remind honorable senators that that distress is nol peculiar to Australia, and that despite it we still have a greater number of blessings to the square foot than any other country has to the square yard. Some persons place so much reliance upon the statements that are made in our parliaments that they believe that Australia is the only country in which there is suffering or unemployment; but that is not the case. With all our handicaps, our disabilities are fewer than those of any other country, and no particular party can be held responsible for them.

Unemployment is one of the greatest problems confronting us to-day, and I honestly believe that the Government of which I am a supporter has done all that lay in its power to assist the States to grapple with it.’ It must not be forgotten that it is the province of the States to deal with this matter, and that it is the function of the Federal Government and Parliament to assist in finding the wherewithal for relief measures. I was interested to read recently of a scheme being suggested in Victoria, which last year I argued was suitable for all the States, on the ground that it would help materially, not only to relieve unemployment, but also to provide more suitable housing conditions for artisans and other workers. Possibly honorable senators have read the statement of a Minister in the Victorian Parliament, in which he advocated the resumption of slum . areas in Melbourne and suburbs, for the erection upon them of hygienic, sanitary, and attractive homes- for the workmen engaged in those districts, so that a good deal of the hardship involved in the cost of the transporting of workers from their homes to the scene of their labours, would be obviated.

Senator Dooley:

– What arrangement does the honorable senator suggest should be made in regard to rent?

Senator PAYNE:

– The rents charged for the more up-to-date homes would, in many cases, be less than are paid for the hovels in which some workers are living to-day. This scheme has been applied successfully on the outskirts of London, particularly in industrial areas. A few years ago, I had the opportunity of investigating some of these experiments, and I was then assured that they were proving most successful. Only a day or two ago, examples of the types of homes provided for workers by the London County Council under this scheme, were published. If the question were taken up energetically and seriously by the people of each State, and pressure were brought to bear on the Governments to give close attention to it, I have noi the slightest doubt that the wherewithal for the transformation would be forthcoming. I wish the Victorian proposal every success.

Senator DOOLEY:

-Does the honorable senator know why some workers live in hovels in slum areas ?

Senator PAYNE:

– Of course I do; that is all they can afford. When I see areas of land which have on them the worst kind of dwelling in which a family could be reared, and know that they could be utilized as the sites of hygienic, modern housing facilities, surely I am justified in suggesting an investigation of the possibilities of the proposal!

The greatest problem with which we are faced to-day is: What is to be done with our boys ? I remind those who, apparently, hold the view that existing governments are responsible for the unemployment of our boys, as well as of the people of Australia generally, that this problem has largely been caused by our interfering legislation. We have decreed legislatively that only a certain number of boys shall be allowed to follow the avocations for which they are fitted, and it is high time that we awoke to the folly of such a policy. In one trade it is decreed that the proportion shall be one apprentice to three journeymen, while in another it is one to five. Even in a country where no development w,as taking place, how could the requirements of skilled artisans be maintained under such a system? In a country like Australia, which needs so much development, it is a suicidal policy. I know of one State in which boys, having availed themselves of the advantages of technical education, and fitted themselves for certain occupations, found the door closed against them when the time came for them to embark on an industrial career. This is not the first occasion on which I have protested against this practice. - I did so when the Tasmanian” Government first entertained the idea of adding technical education to the State school curriculum. I then asked the Director of Technical Education in New South Wales, who was borrowed by the Tasmanian Government, on what grounds he could advocate the expenditure when the boys were prevented by industrial tribunals from entering the occupations for which they had fitted themselves. His reply was that the question was too political in character to be answered by him. We have brought many of our disabilities on ourselves by not looking ahead. I am not in a position to map out a scheme by which they may be remedied ; but I do suggest that if any government expends money on the technical education of our boys, it should also be prepared to find them employment in the occupations for which they have received the necessary training. Another potent cause of unemployment among our boys is the employment of girl labour. Thousands of girls have supplanted boys.

Senator Collings:

– They have to live.

Senator PAYNE:

– How did they live before the Great War?

Senator Collings:

– Their fathers were then able to keep them.

Senator PAYNE:

– Exactly; and many are able to keep them now. During the war, on account of the lack of male labour, girls and women entered occupations that hitherto had been followed solely by boys and men. Since the termination of the war, there has been no diminution of female employment; in fact, I believe that the position has been intensified. An examination of the condition prevailing in a mercantile house which employs 300 hands will reveal that whereas before the war that number included from 250 to 280 males, there are now only 100 males, the balance being females. That is one of the greater difficulties in the way of satisfactorily placing our boys-

Senator Collings:

– The honorable senator would like to have those girls sacked, and so add to our unemployment troubles.

Senator PAYNE:

– I would not. I want our boys to be placed insuitable employment, and so given a chance to become worthy citizens, who will marry and build comfortable homes. These are matters which should have the close attention of this Parliament. It would be worth while to appeal to the patriotism of the far-seeing and intelligent of our citizens, urging them to give their time gratuitously to the nation to meet in conference to evolve a plan which would, at least, partly, solve the problem. It is essential that we should make a beginning, and re-establish commonsense methods in Australia, abandoning for all time the artificial and extravagant customs which we have adopted for years.

I wish to refer to the tremendously heavy burden of taxation that has been imposed on the people of Australia, a burden which has contributed largely to our unemployment troubles. I do not desire to indulge in platitudes, but I may be forgiven if I repeat what I said last year, that every thousand pounds that is collected by the Government in additional taxation, after certain limits have been reached, means the taking away from commerce and industry of £1,000, to. the detriment of the workers of Australia. I am glad that the Government of which I am a supporter has made a step towards reducing the heavy burden of taxation, and I am hopeful that it will afford greater relief during the coming year.

I shall direct attention to some of the inequities that exist, which, I believe, can be overcome, even though the Taxation Department may claim that the administrative difficulties confronting it are too great to be surmounted. Administrative difficulties exist only to be overcome.

Senator Collings:

– Let the honorable senator start by assisting the bottom dog, not the top, as his Government does.

Senator PAYNE:

– I have always assisted those who are on the bottom rung of the ladder, but I do not stand on a soap box in a public park proclaiming to the world that I am out only for the interests of the working man. My sympathies are with the working man.

Senator Collings:

– The legislation of the Government has no sympathy with the working man.

Senator PAYNE:

– I can prove that from time after time, when I have proposed an amendment which would have been to the advantage of the bottom dog, honorable senators of the Labour party have not supported it. I remind honorable senators that, in its incidence, our income tax is incomparably more severe than that of any other country in the world so far as it affects the small property-owner. There is an income tax, upon which has been imposed a super tax, then an additional tax, plus an additional super tax. To that fearsome burden was added another super additional property tax, for the Scullin Government placed additional burdens on income received from property to the extent of 2s. in the £1.

Senator Collings:

– The honorable senator will find that the taxpayers of England are burdened much more heavily.

Senator PAYNE:

– I could prove from statistics that people in Australia who are in receipt of small incomes are more heavily taxed than those in Great Britain who are similarly situated. For one thing, there is “no dual taxation in the Mother Country. A person paying £28 a year in income tax in New Zealand would pay £105 on a similar income in Australia. This Government proposes gradually to eliminate that additional property tax of 2s. in the £1 ; for instance, in future, the first £250 of the income received by anybody from property will not be liable to the impost. The person with a big income will enjoy that exemption, as also will the person with a medium income, in which category I place myself, but anybody whose income would normally be exempt from taxation will still have to pay .that 2s. in the £1. Honorable senators appear to be doubtful. At present, if a person has an income of less than £250, he does- not pay federal income tax. Now, let us assume that the Leader of the Opposition (Senator Barnes), who is keenly interested in the matter, is a poor man, receiving a total yearly income of £250, the result of the investment of his life savings, and on that £250 he and his wife can live fairly comfortably. If the honorable . senator had been recommended by a friend to invest his money in preference shares in certain industrial concerns which were regarded as sound, and had followed his advice, receiving, as a result, dividends to the amount of £200 per annum, he would not enjoy an income of £200 per annum, because, under the amending act of 1931, such companies are given the option of deducting the special property tax- at the source - in this case, from the proposed dividend - and the amount is paid direct to the Income Tax Commissioner. The result is that that official sometimes receives 2s. in the £1 on income which should be exempt from taxation. Is not that inequitable and wrong? Any such amounts paid to the commissioner should be refunded to the rightful owner on application, if he can prove that he has not received the benefit of the £250 exemption that is provided for in the act. I know of a woman who has an income from property of £50 per annum, which, with a small income from dividends on preference shares, is just sufficient for her to live on. The company in which she has shares has exercised its right under the amending act, so that, instead of receiving a dividend of £50, she receives that amount less 2s. in the £1, or £45, the remaining £5 being paid by the company to the Income Tax Commissioner. Yet the Income Tax Act decrees that persons in receipt of an income of less than £250 per annum shall not be subject to federal taxation.

Senator Collings:

– It is the company, not the act, that is doing the wrong.

Senator PAYNE:

– It is the law which permits the company to take that action. When this amending legislation was before the Senate, I foresaw what would occur, and warned the Government, but was told that the department had given an assurance that the administrative difficulties in the way of correcting the anomaly were too great to be overcome.

I have proved conclusively that something must be done to remove this inequity. Why was that amending bill introduced, and why was an exemption made in regard to the operation of that impost of 2s. in the £1 special property tax? Honorable senators will recall that representatives of the State and Commonwealth Governments met in conference to discuss a plan whereby Australia might be financially rehabilitated, and decided unanimously that the first thing to do was to reduce the rate of interest - voluntarily, if possible. Consequently, the rate of interest on the whole of Australia’s internal debt was changed from percentages ranging from 6 per cent, downwards, to a flat rate of 4 per cent. That meant a considerable sacrifice on the part of hundreds of thousands of persons receiving income from investments. That legislation provided that the special property tax of 2s. in the £1 should not be levied on interest obtained from government bonds, because of the deduction that had already been made under the Premiers plan. Shortly after the Commonwealth Government had given effect to its proposals, State legislatures, in pursuance of the general scheme, adopted measures to reduce by 22£ per cent, the rate of interest in connexion with existing mortgages, thus bringing private mortgagees into line with holders of Commonwealth bonds. This being so, I want to know why the Government did not, in the Financial Relief Act, provide that interest income from private mortgages should be exempt from the imposition of the special property tax. It was clearly understood that there would be no discrimination between taxpayers liable’ to pay this special tax, because, as I have ‘ shown, they were all called upon to make the same sacrifice of income. Some time ago, when I protested against this unfair discrimination, I was assured that the administrative difficulties would be too great to permit of the concessions enjoyed by holders of Commonwealth bonds being given to private mortgagees. I entirely disagree with that view. Perhaps, an explanation of my own position will elucidate the point which I am endeavouring to make. When I furnished my income tax return last year, I was required to show how much I had received in the form of interest from government bonds prior to the conversion of Commonwealth bonds into 4 per cent, securities, and also the income in the current year from the same bonds at the lower rate of interest, the intention being to oblige me to. pay the special property tax of 2s. on that portion of income’ received in the earlier part of the current year, when interest rates were higher, and to give relief from the. impost in respect of that, portion of the income received from the bonds carrying the lower rate of interest. I experienced no difficulty in making the necessary adjustment of income, and I fail to see how this objection can be advanced by the department against the proposal that private mortgagees should be given the same concession, in connexion with the super property tax, as is afforded to holders of Commonwealth bonds. If, for example, I received by way of interest on mortgages £100 a year from four persons to whom I had advanced money, and another £100 from four other persons, making my total property income £200 a year, under the Financial Relief Act I should be required to show, in my income tax return, what portion of my total income was based on interest at the higher rate and what portion had been earned, after making a deduction of 22J per cent, as required under the Financial Emergency Act, and I could, advance no good reason why it would be impossible for me to show the two sources of revenue. Similarly, I fail to see why the plea of administrative difficulties should be advanced as a reason why private mortgagees should not enjoy the concession given to holders of Commonwealth bonds. I hope that the Minister will give careful consideration to what I have said, and see if it is not possible to take some action to treat all classes of taxpayers alike. To me the matter seems to be quite simple. If the Commissioner of Taxation is not satisfied with a return furnished by a taxpayer, all that it will be necessary for him to do will be to ask for a .definite statement, signed by the parties to a mortgage contract. Such a certificate should be sufficient. I am, of course, aware that the departmental officers must carry out the law, and for this reason I urge the Government to remedy the anomaly to which J have referred, either by ministerial instruction to taxation “officials, or by legislation, as speedily as possible.

Dealing now with the bill itself, I congratulate the Government for having removed some portion, at all events, of the heavy financial burden illegally imposed upon the people by the preceding Government. I admit that an indiscriminate reduction of duties brought in by the previous Administration might adversely affect certain industries, and I pay my tribute to this Government for having arranged for inquiry by the board, of all tariff items affected, with the least possible delay. The Scullin Government imposed duties without regard to the law, and, in some cases, in defiance of the law, which enacts that no tariff alterations shall be made without first being referred by the Minister to the Tariff Board for inquiry and report. There is no suggestion that the Minister is bound to adopt any recommendation made by the board.

Senator O’Halloran:

– It was left to this Ministry to make that necessary in the case of items affected by the Ottawa agreement.

Senator PAYNE:

– Being a law abiding community, quite naturally we expect Ministers of the Crown to set an example. I say this because many of our present difficulties are, I believe, due to the flagrant violation of the law in regard to tariff matters by the previous Administration, and I commend this Government for its expedition in endeavouring to remedy, as speedily as possible, the evils consequent on such action.

Senator O’Halloran:

– Increases in some tariff items were made by this Government without reference to the Tariff Board.

Senator PAYNE:

– I shall deal with those items when we are discussing the schedule itself. At the moment I am debating the general principle, and I repeat that nothing could justify the wilful violation of the law by the previous Administration. The alterations made to the tariff were so extensive that itwas impossible for this Government, at short notice, to make a. complete revision of the schedule. In many instances the extreme protection given by the Scullin Government is being perpetuated in this new schedule.

I wish to emphasize, as strongly as possible, my detestation of what I regard as the rankest hypocrisy in connexion with the so-called British preferential tariff. I am surprised that the British people have been so patient, and that their representatives at the Ottawa Conference did not bring this matter before the delegation from Australia. Honorable senators opposite have, on many occasions, alleged that, at the Ottawa Conference, the representatives of the Mother Country exacted their full pound of flesh from the dominions. That was not the case. Within the last week or ten days reports received from Great Britain indicate that the people of the Mother Country are at last becoming resentful at our tariff treatment of British goods. -Last week, questions were asked in the House of Commons about Australia’s so-called British preferential tariff.

Senator PAYNE:

– Although we retain the hypocritical title of British preference in the tariff schedule, under the illegal Scullin tariff it amounted to nothing less than total prohibition. The rates shown in the schedule for British goods were lower than those on foreign goods, but they were still so high as to prohibit the importation of goods from Britain. One must commend the forbearance of the British representatives at Ottawa in not using that point effectively during the negotiations. Personally, I am pleased that they refrained from doing so, because otherwise we should not have received very much consideration. When I was in England four and a half years ago, at the time the 1921-30 tariff was in operation, I advocated additional trade between Britain and Australia. It was then brought under my notice by the representative of a large manufacturing association that the duties against British goodswere so high that, in one year, his firm had had its export business to Australia reduced by 85 per cent. Nevertheless, the rate was subsequently increased by 500 per cent. by the Scullin Government, which ignored the act requiring proposed increases to be referred to the Tariff Board. I am glad that the present Government has considerably reduced the imposts placed on the people, not by Parliament, but by a resolution introduced by a Minister, though even the present rates are still125 per cent. higher than those of four and a half yearsago, which were themselves prohibitive.

Senator McLachlan:

– Has the honorable senator any objection to mentioning the item to which he is particularly referring?

Senator PAYNE:

– I shall do so at the proper time. We are not, at this stage of the debate, permitted to discuss specific items. About two weeks ago members of the House of Commons protested publicly against the Australian duties on British goods, as is shown by the following cablegram published in the Australian press : -

In the House of Commons to-day, Mr. Waterhouse (Conservative) asked if the Dominion Secretary would draw the attention of the Commonwealth Government to the fact that the duties and taxes on British socks and stockings entering Australia were over 90 per cent., and those on cotton stockings 250 per cent.

Mr. Thomas said reductions in these charges had been made on the 9th March, but the duties were still at a very high level. It was understood that the Tariff Board was considering the position.

Mr Chas Brown:
Labour

– Do you think these duties encourage Empire trade?

So far as I know, that was the first time any protest of the kind has been made in Great Britain against the hypocrisy of our British preferential duties. In that extraordinary tariff schedule, which became operative by virtue of a resolution, there are many items on which the duties were doubled. There is no indication that any effort was made to determine what, would be a fair rate of duty, and, in respect of practically all items on which the duty was doubled, the effect was felt more acutely by the workers than by the wealthy classes. The wealthy were not injured, but rather given an advantage, by the idiotic practice of placing a flat rate of duty on goods, irrespective of their value. For instance, an article manufactured in England, and exported at 7s. 6d., had to bear a duty upon arrival here of 7s. 6d., while an article of infinitely superior quality, the export value of which was £3, would still have to pay only 7s. 6d. in duty upon arrival in Australia. It is clear, therefore, that those who could afford to buy only the lower-priced article were heavily penalized by the flat rate of duty. I am sorry to say that the present Government has retained this system.

In order to show the fallacy of the claim that the British manufacturers derive any benefit from the preferential duties, I shall refer to some important, items of the schedule. Honorable senators will see in one part of the schedule where a flat rate of 2s. an article was imposed by the Scullin Government on certain goods manufactured from cotton, and that duty has been retained. A little further on is another item’ dealing with goods containing wool, though there may be 95 per cent, of cotton and only 5 per cent, of wool. On these articles there is a flat rate of 5s. each. I can take honorable senators into any dry-goods store in Australia, and show them just how these duties work out. If we go to the counter and ask the retail price of one of the cotton articles, we shall be told that it is ls. 3d. If we ask if a reasonable profit is being made at that price, we shall be told “ Certainly “. If we ask how the manufacturer is faring we are informed that the price at the mills is probably 10s. a dozen, and that the manufacturer is evidently making a satisfactory profit, because his balance-sheet sets forth his profits, and the dividends paid. On the goods which are sold to the public at ls. 3d. each, the British preferential duty is 2s., and yet we pretend that we are bestowing a favour on the British manufacturer ! If we then ask for the next grade of goods, containing some wool, we are told that the retail price is ls. lid. Again, tie retailers are making a satisfactory profit, as are the manufacturers; yet the British preferential duty on those articles is 5s. each. Surely it is high time that we analysed the schedule so as to remove these silly and unnecessary imposts on imported goods.

I am very glad to observe that the Minister has provided in this schedule a fairly substantial reduction with regard to another item on which there is a flat rate, plus an ad valorem duty. In almost every instance in which a flat rate of duty, or an ad valorem rate of, say, 45 or 50 per cent., is imposed, the duty is collected on whichever rate returns the greater revenue. It is always the flat rate which operates, so that the ad valorem duty is rarely collected. In respect of this item, the rate of duty submitted by the present Government is lower than that set forth in the Scullin resolution. I cannot call it a tariff; it is simply an imposition placed on the people by virtue of an action which should have been overshadowed by the law which requires proposed increases to be referred to the Tariff Board. The former duty was prohibitive. When the item was under discussion some time ago, I proved that, in order to provide an addition to the wages sheet of Australia of £60,000 a year, the working classes would be called upon to pay an extra £300,000 a year for the commodity when it was manufactured solely in Australia. The truth of my statement has been amply demonstrated since then. The working class has to bear the burden, yet the continuance of this state of affairs meets with the- approval of those who profess to represent the working classes of the Commonwealth.

The charges imposed under the tariff are not the only ones which have to be borne by goods entering this country from overseas. I have figures here to show that goods manufactured in the United Kingdom have to bear, in addition to the duty, no less than an extra 59 per cent, on the landed cost by way of charges for freight, casing, insurance, primage, exchange and sales tax. Let us take for example an item carrying a duty of 45 per cent, ad valorem. On this, the extra charges are as follow :-r-

When one realizes the extent of the natural protection afforded to Australian industries, and considers this in conjunction with the tariff protection imposed by the Government, one can readily understand why many articles in general demand in Australia have become so expensive as to be out of the reach of many persons.

This extraordinary tariff has had a tendency to restrain those engaged in the process of manufacture from putting forth their best efforts. The elimination of competition invariably has a tendency to force up prices. If a monopoly is given to any individual, or even to a large group of manufacturers, full advantage will be taken of it. Therefore, reasonable competition is essential.

The amendment moved by Senator Johnston should be acceptable to all honorable senators who in the past have expressed opinions similar to those I am voicing to-day. While asserting my readiness to give reasonable help to Australian industries, I have for years protested against protection carried to excess. Many of the duties that have been imposed are not protective; they are prohibitive. If I am. to be true to the convictions which I have expressed in the past, and still hold on the fiscal issue, I must support the amendment that the bill be returned to the House of Representatives, with the request that it be amended, so that the proposed duties against British goods shall be reduced to the level of the 1921-1930 tariff, in all cases where they have been raised above that level without report by the Tariff Board. Only one attitude can be adopted by any person who believes in the observance of the law, and it is undeniable that the law was broken by the imposition of customs duties by resolution without prior reference to the Tariff Board. I have protested repeatedly against this course, and I do so again. The adoption of the principle embodied in the amendment will do no injustice and impose no handicap on any Australian industry. Reference to the annual reports of the Tariff Board shows that the duties operating to the end of 1929 had been effective in helping to establish and develop secondary industries in Australia. Indeed, the prosperity and power attained by those industries reacted to the disadvantage of the basic primary industries, I emphasize the urgent necessity for the Government to pay heed to the plea made by Senator J. B. Hayes for the primary producers. Nearly every disability imposed upon those engaged in primary production is attributable largely to the high cost of the goods and materials required by the farmers, graziers and orchardists to develop their holdings.

Senator HERBERT Hays:

– The worst feature to-day is the cost of spare parts for agricultural machinery.

Senator PAYNE:

– The duties on items of machinery are prohibitive. Often one sees a useful piece of agricultural machinery idle and rusting because the farmer cannot afford the enormous cost of spare parts necessary to recommission the machine. Those costs are entirely due to prohibitive customs duties. I have always taken a sympathetic interest in pioneering work in Tasmania. I have known many thousands of acres of socalled impenetrable forest to be converted into useful holdings. No forest is impenetrable if tackled by men with stout hearts and strong arms. Similarly, equity in taxation is not impossible if a stout-hearted parliament is determined that equity shall prevail. Thousands of acres of land which had been reclaimed from primitive forest by the cutting of timber, the removal of scrub, and the development of pastures, and which for years had been revenue producing through cattle-raising, are to-day without a blade of grass or a head of cattle. The land is covered with a second growth of timber and scrub. This retrogression is due largely to the fact that this Parliament has imposed heavy duties on fern hooks, axes, mattocks, and all the other implements required by the bushman to keep such holdings in use. “When the rabbit curse became serious, Parliament, instead of offering every encouragement and assistance to those who were engaged in combating the pest, imposed heavy duties on traps, the cost of which increased 100 per cent.

Senator J B Hayes:

– That applies, also, to wire netting.

Senator PAYNE:

– And to almost every other requirement of the primary producer.

In conclusion, I feel impelled to say that, unless something is done to rehabilitate the all-important primary industries, Australia has little chance to recover. If we can gradually re-establish those industries on a sound basis, we shall confer a tremendous boon on the secondary industries, also. “Work will be provided for our people, inducements will be offered to people of the right type to come to Australia from overseas, and so we shall bo increasing the home market for both primary and secondary products. If, on the contrary, the primary producers should be starved off their holdings, Australia would be left without any permanent industries or wealth-producing assets. Already our industries are supplying much more than the Australian people can consume, and we must look to outside markets. We want a wisely-conceived economic and fiscal policy, which must be gradually applied.Rome was not built in a day.

Senator Collings:

– “ Let the people starve slowly; do nothing in a hurry.”

Senator PAYNE:

-If we reform in haste, we may have to repent at leisure. We have before experienced the tragic consequences of drastic political and economic action hurriedly taken, and without adequate forethought. I hope that the criticism which has been directed against this bill will be received by the Government in the spirit in which it is offered. The Government is, I am sure, actuated by a desire to do what is best for all our people, and I specially commend to Ministers the plea for the removal of the unnecessary burdens on the people, thus promoting a restoration of confidence, and offering the primary producers a prospect of eventually regaining the sound position that they occupied a few years ago. Those considerations should have first place in the deliberations of the Government.

SenatorRAE (New South Wales) [2.42]. - The manner in which honorable senators who are members of the celebrated United Australia party are criticizing their own Government makes me extremely sad. I had not a full comprehension of the inherent wickedness of the Ministry until I heard it weighed and assessed by its own supporters. I do not intend to traverse the arguments that have been adduced regarding the iniquity of high tariffs. It is my conviction - and if the Labour party generally does not believe the same, it fails to appreciate demonstrated facts - that tariffs are only palliatives, and not a cure for a world disease. Neither the farmers nor the workers can be emancipated by a mere manipulation of tariffs. I recollect the rise of the Labour party out of the financial and economic upheaval in Australia in 1890. Prior to that time Labour did not, in an organized fashion, take any part in politics. In New South Wales, where the political Labour movement was born, there had, for some years, been a vigorous war between the advocates of protection and the advocates of freetrade, and the workers virtually said at that time : “ A plague on both your houses “. They were tired of the game between the “ ins “ and the “ outs “ on the fiscal question, and said, “ We do not believe that any form of fiscalism will, of itself, do anything of a permanent character to emancipate the working class from the serf-like conditions which they now suffer “. I have always remained of that opinion, and, consequently, I cannot, with very great heart, take part in the constant bickerings that occur over tariffs. But I think that so long as the capitalistic system continues to exist, we must use tariffs for two purposes - bargaining and retaliation. Tariffs provide us with a means of making something like fair conditions with other countries by the granting of concessions, or of making trading conditions impossible by the fixing of prohibitive duties.

My main object in rising, however, was to reply to some statements made by Senator Greene, who, in defending the work of the Resident Minister in London, saw fit to make a bitter attack upon the Lang Government of New South Wales. Senator Greene attributed directly to Mr. Lang and his Government, whatever delay there had been inthe floating of a conversion loan in London. He went so far in this direction that the press has described his speech as one of the most bitter condemnations of the Lang Government that had been made by any public man. Personally, I do not care how bitter a speech may be so long as it is based on facts; but I object to Senator Greene’s speech because of its absolute inaccuracy. The honorable senator said, among many other things, that the Lang Government had repudiated the debts of this country to the British bondholder. He practically accused it of having repudiated principal and interest, lock, stock and barrel. That is a deliberate mis-statement of facts. Any one who has taken the trouble to read the authoritative statements of the Lang policy, which have been published hundreds oftimes, will know that it is a mis-statement of fact to say that Mr. Lang intended, or attempted, or proposed, to repudiate our debts to the British bondholders. I have heard a good many people say that they would not stand behind Mr. Lang, because he did not go far enough; but that is beside the question. What Mr. Lang said was that the British bondholders should be informed that, until they were prepared to bring their interest rates down to about the same level as the rates being paid by Great Britain to the United States of America, we would not pay the interest that was due to them. That is the sum and substance of the Lang proposals.

Senator Brennan:

– Surely that is repudiation ?

Senator RAE:

– If that is repudiation, it was equally repudiation for this Government to pass legislation which compelled the Australian bondholders to convert their holdings to securities carrying a lower rate of interest. If it was repudiation for the Lang Government to say to the British bondholders : “ We will not pay our interest debts until such time as you are prepared to make a fair bargain with us,” it was equally repudiation for this Government to say to the Australian bondholders, “You must convert your present holdings to securities bearing a lower rate of interest, which we shall prescribe. If you are not prepared to do this voluntarily you will be compelled to do it anyhow”.

Senator Brennan:

– There is surely a difference between the dealings of a government with the people of an independent country and its treatment of the people of its own country.

Senator RAE:

– In other words, the honorable senator would say it was more reprehensible to be dishonest to an outsider than to a fellow countryman.

Senator Collings:

– The Government did not hesitate to reduce the wages of the trade unionists of Australia.

Senator Brennan:

– Wages are not sacrosanct.

Senator Collings:

– Neither should the securities of bondholders be sacrosanct.

Senator RAE:

– If our obligation to trade unionists to pay the basic wage can be repudiated, I see no reason why our obligation to the British bondholder to pay a specific rate of interest should be sacrosanct. If, in the interests of the balancing of budgets - a mythical performance which is talked about, but not effected - the Government is justified in robbing the widows and orphans, in pulling down wages, and in reducing the standard of living throughout Australia, I can see no reason why it would not be equally justified in pulling down interest rates. That is what the Lang Government proposed to do. Mr. Lang also argued that if one bag of wheat or one bale of wool was sufficient to pay a certain amount of interest when particular loans were floated, we should continue to pay one bag of wheat- or one bale of wool in discharge- of those liabilities. We know that, in consequence of the fall in the price of our primary products, bondholders were asking from two and a half to three bags of wheat or bales of wool to discharge an obligation that one bag or one bale discharged when the obligation was .incurred. In other words, the decrease in the price of our commodities caused an increase in the value of their bonds. One of Mr. Lang’s proposals was that we should pay our interest bill in goods value, rather than in monetary value, which fluctuated from time to time.

Senator Brennan:

– Our contract was to pay in gold. Though I do not say that there is not much to be said for the argument of the honorable, senator, the fact remains that we contracted to pay in gold.

Senator RAE:

– Owing to circumstances which arose, it became impossible to pay every one in full, and the Lang Government made an offer to the British bondholders which gave them the alternative of accepting a lower rate of interest, or of getting no interest at all. If the bondholders would not accept the lower interest rate, they would be in the unfortunate position of getting nothing. I admit that it was rather a “ stand and deliver” attitude; but, in the circumstances into which this country was plunged, it was perfectly justifiable. But even if it were not justifiable, there was. no necessity for the honorable senator to make accusations against Mr. Lang and his party, which were not in accordance with the facts. Senator Greene said that Mr. Lang’s policy was the repudiation of both principal and interest, and that the enunciation of this policy had put long-standing difficulties in the way of this. Government in its negotiations for lower interest rates in Great Britain.

There would have been no necessity for either Mr. Bruce or any other representative of the Government to negotiate for the conversion in the dim and distant future of our bonds bearing interest at from 5 to 6$ per cent., had the Lang proposal been given effect, because that conversion would have taken place, and we should now be reaping the benefit. What difference is there between that proposal, excepting for what might be called its directness or bluntness - a “ stand and deliver “ method - and the action of the British Government in stating in no uncertain voice that its most recently paid instalment of its debt to the United States of America would be the last under existing conditions? Mr. Ramsay MacDonald, the Prime Minister of Great Britain, and his principal Ministers who have dealt with this matter, have openly proclaimed that their most recent payment to the United States of America would be the last until the conditions of its war debt to that country were revised. I submit that the revising of conditions, no matter’ to what extent, is repudiation of the old conditions. Why cavil at a word when one person, government or party proposes to do exactly what another is doing, except in regard to the extent of the operation? There can be no difference in principle whether we repudiate 1 per cent, or 3 per cent.

Senator Hardy:

– It makes a lot of difference to the bondholders.

Senator RAE:

– That may be so, but there is no difference in principle. The honorable senator must admit that to tell a person who is entitled to an interest payment of 5 per cent, that he will in future receive no more than 3 per cent, or %i per cent, is repudiation. The difference is in degree only.

Let us look at another phase of this subject. We were told by Senator Greene, and subsequently by other honorable senators, that as the greater proportion of our debt had been contracted for the construction of public works, we had no right whatever to place it on the same basis as our war debt. Personally I fail to see why there should be any distinction between them. On the one hand, the money was borrowed for construction purposes, and on the other, for destructive purposes. Still in either case it is a contract between the borrower and the lender, -and the mere question as to what is to be done with the money so borrowed does not affect the main question - whether it is right or wrong to keep to our bargain. Great Britain’s debt to the United States of America is entirely a war debt, but the major portion of our overseas debt was contracted for construction purposes.

Senator HARDY:

– We do not owe to the United States of America any money on account of war debt.

Senator RAE:

– I am dealing with the fact that our overseas debts generally were contracted on behalf of the various States, mainly for construction purposes, and not for war purposes, whereas the British debt to the United States of America was a war debt. I do not see any particular difference between those debts so far as honouring an obligation is concerned, but I would point out that a large proportion of our debt on account of ordinary public works, which was contracted during and since the termination of the war, would have been unnecessary had it not been for the cost of the Avar.

Senator HARDY:

– We borrowed overseas for war purposes only £90,000,000.

Senator RAE:

– We expended a good deal of our own revenue for war purposes, and, in consequence, were compelled to borrow moneys that otherwise would not have been required by us. Therefore, debts incurred as a result of the war, even though not entirely for war purposes, should not be separated from war debts so far as our obligation to pay a heavy interest bill upon them is concerned. We all know that the interest bill which the Commonwealth and States jointly have to meet is the chief cause of our poverty to-day, and that the life-blood of this country is being drained from it by a huge and constantly-increasing burden of interest.

Senator HARDY:

– What is the total of Australia’s overseas interest bill?

Senator RAE:

– The total, including exchange, is from £35,000,000 to £37,000,000.

Senator HARDY:

– It is £52,000,000, both external and internal.

Senator RAE:

– It must be admitted that this tremendous burden has a complete stranglehold on Australia, and how the tariff, whether it is high or low, is going to alter that position, passes my comprehension.

Senator HERBERT Hays:

– A low tariff would enable some people to pay who cannot now pay.

Senator RAE:

– Some people would still be unable to pay. We cannot, by mere tariff arrangements, hope to get

Australia out of its present position. I do not want the people to keep on paying. The mere increasing of the people’s income to enable them to pay more money to some one else would be of no permanent value to them or to this country.

Senator Herbert Hays:

– That is the only way in which this country can pay its debts.

Senator RAE:

– I do not want Australia to pay its debts in that way. Those who have made profits in the past should pay whatever is required. The burden should not be thrown entirely upon the working and middle classes.

Senator Barnes:

– The people who have made profits made them out of the juggling of Australian bonds.

Senator RAE:

– I agree with the honorable senator. It appears to me that the position in which Australia finds itself to-day, along with some other countries, calls for more drastic proposals than any government has yet dared to put forward. This Government is making a desperate attempt to retain for the bondholders, whom it represents, the profits which they have made in the past. Now that those profits are being menaced, the bondholders are adopting all sorts of frantic measures to try to stay the dry rot which has fallen upon the capitalistic system. We are told that the present Government, acting in concert with most of the State Governments, is considerably reducing unemployment; but it is reducing unemployment by adopting the device, which is worthy of the old poorlaw system of Great Britain, of giving a man work for one day or one and a half days a week, so that he may be able to pay for his rations, and placing him on the dole during periods of unemployment. The provision of relief work, which gives a. bare existence to a few thousands of our people scattered over the Commonwealth, is, after all, only an extension of the old system of borrowing money and thereby increasing our interest burden. What do we hear from the Stevens Government in New South Wales, and the governments in some of the other States, other than the claim that they have succeeded in making arrangements with the banks, with the result that more money is available than was the case a short while ago? That really means that more money has been borrowed, and, therefore, that more money must be repaid. A good deal has been said about the issuing of treasury-bills.

Senator Hardy:

– The issuing of such bills is merely the release of credit, which the honorable senator advocates. ‘

SenatorRAE. - When too many treasury-bills have been issued, the Government says, “ We must fund these bills “. It does so, and the effect is to add to the public debt, thus placing a permanent, rather than a temporary, burden on the people.

Senator Hardy:

– That is an entirely wrong interpretation of the principle underlying the issue of treasury-bills.

Senator RAE:

-The honorable senator, in criticizing the Government which only a short time ago he said would pull Australia out of its difficulties, had only two proposals to make, and they were of the will-o’-the-wisp nature. First, he said that he would increase the exchange ;but that, after all, is a purely artificial device by means of which the whole of the people are taxed in order to benefit the few. Secondly, he said that he would divide the larger States into a number of smaller States.

Senator Barnes:

– And break up the Empire !

Senator RAE:

– I shall not misinterpret the honorable senator’s remarks. He professes to believe in a simpler form of government than now exists. Probably Senator Hardy’s object in seeking to divide New South Wales into three or four States is to get into Parliament three or four times as many senators of his fiscal belief as are now in it. Boiled down, the honorable senator’s proposals mean a more conservative Country party, with greater power,so that the working class would be worse off than ever.

Senator Hardy:

– Are not the primary producers, who produce three-fourths of our wealth, entitled to adequate representation in this chamber?

Senator RAE:

– Senator Hardy and his colleagues in the Country party frequently refer to the high percentage of primary products contained in our exports.. As is usual in the case of people who make bigoted party appeals, such statements are not correct. The Country party claims that butter, flour and bacon are primary products, whereas, in fact, they are manufactured products.

Senator Brennan:

– That is the latest theory of Mr. Hume Cook and those who think with him.

Senator RAE:

– I do not care whether it is the latest or the earliest theory. The question is whether it is right. Wheat in its raw state may be fed to poultry or pigs, but not to human beings. The general practice is to turn the wheat into flour for human consumption, thus making it a manufactured commodity in the same way that iron ore becomes a manufactured commodity when converted into steel. The curing of bacon and the manufacture of butter are secondary industries. We cannot export cream unless we first turn it into butter.

Senator Sir Walter Kingsmill:

– According to the honorable senator’s reasoning, the turning of lucerne into butter would be a secondary industry.

Senator RAE:

– It is possible to prove almost anything by juggling figures. When raw materials are changed into manufactured articles, they are no longer entitled to be classified as primary products. Axes, spades, fern hooks, and similar articles are manufactured articles.

Senator Brennan:

– Does digging for gold make the gold won a secondary product?

Senator RAE:

– When human labour, either alone or in conjunction with machinery, is used to turn raw materials into something entirely different, the product is no longer a primary product.

Senator Brennan:

– Then gold in ingots is not a primary product?

Senator Sampson:

– Would the honorable senator regard as a secondary industry the turning of sheep into mutton?

Senator RAE:

– The argument that nearly all the things which we export are primary products is shattered when we consider what really constitutes a primary product.

Senator Hardy:

– What proportion of our exports comes from the metropolitan districts of Australia?

Senator RAE:

– I remind the honorable senator that much of the work which at one time was performed on the farms and stations is now done in factories in the cities. “When I was a lad, working on a farm, the crop was reaped with obsolete implements, such as scythes, and the sheaves were bound by hand. In those days it took a big army of men to gather a crop, whereas to-day modern machinery, in the form of reapers, binders, strippers, and headers, does the work with one-tenth of the human labour formerly required. Honorable senators opposite complain of the congestion of population in the cities, and of the drift of population from the rural areas, as though it were a condition of affairs peculiar to Australia. Surely they know that that condition is world-wide, and is due largely to the fact that manufacturing industries are generally concentrated in areas where transport facilities are available.a It is useless to attempt to throw the blame on the allegedly high wages paid in the cities. In my opinion, it is healthier to work in the country than in ‘a city; but such miserable rates of pay are given in rural industries that many people who would prefer to live in the country are forced into the cities. If city workers are able to organize themselves more effectively than employees in the country, and are thus able to demand a fair share of the wealth which they produce, all power to them. Let the workers in the country profit by their example. The general use of telegraphic, telephonic, and wireless broadcasting services throughout the country should enable employees in rural areas to organize along lines similar to those adopted in the large centres of population.

Senator Dooley:

– :If we placed the unemployed on the land,, how could a market be found for their surplus products?

Senator RAE:

– That question, of course, must be considered. None of the palliatives that are advanced for the cure of the present ills of the community will provide a permanent remedy. Many attempts have been made to settle the unemployed on small areas. The idea of solving this, problem by placing families on allotments . containing two or three acres in the country is quite impracticable. I remember when village .settlements were established in many parts of Australia, and also in New Zealand; but practically all of these have ceased to exist. Either it was found that production was more costly on small holdings than on large areas, or, if the soil was particularly fertile,, the products of the settlements glutted the market, and the producers were unable to overcome their difficulties by means of co-operative action. While production has been organized to some extent, and its potentialities permit an enormous increase in the output of the manufactured articles that the people require, the system of distribution is faulty. Warehouses are overflowing with unsaleable goods, but the vast majority of the people in every country are going short of the bare necessaries of life. Duties, whether high or low, will not remedy that trouble. Tariffs are useful instruments in enabling countries to bargain with one another, but they do not lead to prosperity. Why are other countries unable to purchase the products of Australia to the same extent as three or four years ago?

Senator HARDY:

– They .are not only unable to do so; they refuse to do it, because they desire to retaliate against our tariff.

Senator RAE:

– Their action is not dictated merely by pig-headedness ; they wish to keep what wealth they have in their own country. They claim, as we do in Australia, that it is unreasonable to admit the cheap manufactured goods of another country while their own people are out of work. A report was published in the press recently about the low rates of wages paid in Japan. If Japan considers it necessary to exclude Australian products, and to flood this country with cheap Japanese goods, that is a- further indictment of the capitalistic system.

Why are nations throughout the world making frantic attempts to bring about their own economic salvation at the expense of other nations? Obviously, the present system is unworkable. The Labour party desires that the wealth which we all help to create shall be shared by all. The ruling classes of nearly every nation are using every possible means to prevent the utter collapse of capitalism; but they are doing this at the expense of the working classes, which are being ground down to a state of destitution. While capitalism prates of freedom and our glorious British traditions, it introduces all kinds of repressive legislation, in order to prevent revolt. The people are being robbed of their liberty, and the statute-books are reeking with antiLabour legislation. When I speak of the ruling classes, I meanthose that have economic power. Some people will say that every man in this country has the same voting power as his neighbour; but political power without economic power is useless. I have done more work on the land than in other ways, and I assert that Country party members are not correct in claiming that everything goes to the. city, and nothing to the country, and that tariffs work only in the interests of city dwellers. It is a matter of fact, not of opinion, that a great deal has been done by State and Federal Governments to assist the man on the land.

Senator Brennan:

– That is a sop which has been thrown to him as compensation, because tariffs have pressed on him.

SenatorRAE. - I do not say that tariffs work in the interest of the man on the land. What I claim is that, even though, because of their nature, they may make concessions to those who are employed in what are admittedly secondary industries in the cities, there are compensating advantages in country districts. I speak with first-hand knowledge of my own State, and, from reading, I know something of the conditions in the other States. Seed wheat and fodder have been distributed to the primary producers, and their sheep have been carried for less than the cost of transport from droughtstricken areas to areas in which feed may be obtained.

Senator E B Johnston:

– The State Governments are responsible for those concessions.

Senator RAE:

– I know that they are. I am merely saying that these are compensating benefits which the primary producers enjoy. I challenge Senator Johnston, or any one else, to deny that the land values of rural areas have been increased as the result of the expenditure of millions of pounds on railway construction. Admittedly, large sums have been expended also in the capital cities; but one must not overlook the fact that those cities are not merely residential areas for those who work in them, but are largely availed of by country dwellers, who would find things sadly out of joint were they to be abolished. The people of the cities consume a large proportion of what is produced in rural areas; therefore, it is stupid to try to set country against city, because each is mutually dependent on the other. The 1,250,000 people in the metropolitan area of New South Wales provide the primary producers of that State with the best market that they could have.

Senator Hardy:

– We are prepared to enter into an equal partnership, provided that the cities will agree to it.

Senator RAE:

– I know the sort of equality that the honorable senator wants. A celebrated character in French history -Madame Roland - said, on one occasion, “ O liberty ! liberty ! how many crimes are committed in thy name!” So I say, “ What frauds are perpetrated on the people in the name of’ equality of sacrifice and of political power’” ! In Victoria, for example, the boundaries of the constituencies are so fixed that a handful of people in the country have a greater number of representatives in the State Parliament than a much large number in the cities.

Senator E B Johnston:

– Which is quite right.

Senator RAE:

– The demand that rural interests shall be given greater political power than the cities, is, in my opinion, founded on injustice. There is no sound reason why 5,000 country people should have the voting power of 10,000 city people. There is no justice in giving votes to acres; yet that is what the honorable senator advocates. So long as I, and those who believe as I do, are able to raise a voice against such a practice, we shall do so. The only argument in favour of it is that it is easier for people who live close together, than for those who are scattered, to organize.

Senator Brennan:

– It is a very powerful argument.

SenatorRAE. - As I have already pointed out, modern means of transport and of communication have largely overcome the difficulties that only a generation ago were attached to the isolated state. That, of itself, goes a long way towards disposing of such a claim. But even at the best, this practice cannot be justified on its merits. It was only a sop that was thrown out by vote-catching politicians to those to whom they were afraid to mete out justice. If that is one of the principal claims on which the Country party intends permanently to base its existence, I venture to prophesy that a relentless war will be waged between that party and those who insist upon human “rights, not the mere possession of acres, being the basis of political power.

Senator Greene took advantage of the opportunity afforded by this debate to make a vicious, “venomous attack on a man who is not, and could not be, here to defend himself. He did not confine his criticism to facts, but went beyond all reason in stating what is not true - that wholesale repudiation was the policy of the Lang Government. If a direct reduction of interest internally had been effected, as Mr. Lang proposed, there would have been an enormous saving of time and money, and a much earlier settlement of the question. I venture to affirm that no one who supports the action of Great Britain and of those countries that owed debts to her, can find fault with the Lang proposal, except to say that it was designed to do directly what might be effected by negotiation in the course of years. We must not overlook the fact that only a few years ago, when the conversion of our internal loans was effected, a few million pounds were not voluntarily converted. There were in some cases good business reasons why those voluntary conversions were not made. Certain trustees received legal advice that they might be liable to civil action if they consented voluntarily to such conversion, and they, therefore, abstained from doing so. The Government immediately passed legislation to compel the conversion of the bonds of those who did not voluntarily convert. At the beginning, my party suggested that there should be no hypocrisy; that the conversion should be compulsory. Had that course been followed, it would have saved the huge advertising expenses that were incurred, and there would be greater respect for our political institutions. Unfortunately, more than half of the legislation that we pass is a pretence.

I can easily see the result of the tariff wrangle that is now taking place between the Country party and the United Australia party. Unfortunately, the party with which I am associated, though united, is not sufficiently strong to effect the result; but the other parties will merely put up a sham fight, and the policy of the Government will be carried into effect. Undoubtedly, this policy of humbugging the people is gradually dragging our political institutions into general disrepute. Why do not we act in a straightforward manner, pass legislation in which we believe, and vote as we think fit? The Government would find that that would pay it better than resorting to “ underground “ party manoeuvring, which results in legislation being introduced that has sometimes been shown to need amendment even before the second reading is concluded. And that is done by persons who claim to be patriots and upholders of constitutional government !

The Government is attempting to bring about prosperity by undertaking transitory relief works, and by doing what, it claims, will restore confidence in the minds of the British investor. I want to know what that means. Assuming that the British investor is gulled into believing that we are the finest people on earth, and is persuaded to press upon us further loans, how will that bring about prosperity in Australia? It is just that piling up of great public debts, with their accompanying burden of interest, that has driven prosperity from what should be God’s own country. Yet honorable senators opposite claim that, by plunging us further into the abyss of debt, they will restore confidence. How can they expect the people to believe so slim a tale? If borrowing were a remedy for poverty, we should long since have been cured of the evil.

If, on the other hand, honorable senators opposite imagine that confidence in us will be restored in the mind of the British investor by reducing wages and conditions to at least the level of European countries, and later to that of Asiatic countries, there again they will find themselves in error; for what one country can do in the way of cheapening production, by lowering the standard of living, can also be done by another. The world competition which already exists would become more vicious, and the last condition of the people would be worse than the first.

From time to time, when our opponents can find no answer to the statements concerning the general poverty and dislocation that exist in Australia, they assert that those conditions are largely due to the socialistic legislation undertaken by certain governments. Such statements are particularly current in the States. I ask those who charge us with having brought about those conditions of general poverty, through giving effect to Labour legislation, including the provision of industrial awards, how they account for the widespread unemployment and the financial ruin that have overtaken the United .States of America - that country in which individualism has attained highwater mark?

Senator Brennan:

– And in which the highest wages are paid, and the highest tariff in the world exists!

Senator RAE:

– Admittedly; and in which there is the freest possible rein to individual effort to acquire wealth, and to use one’s talents to effect one’s aggrandizement! The policy of individualism has been carried on to such an extent that the methods of the, gangsters of Chicago and other big cities of the United States of America are its natural outcome. The United States of America with its immense natural resources, great navigable rivers, magnificent harbours, its virile population remarkable for its inventiveness in the industrial field, and capable of supplying the needs of the whole world if its great manufacturing establishments were working full time, has lately taken one of thu biggest steps towards absolute ruin recorded in the history of the world. The deplorable plight of the United States of America is, I suggest, a sufficient answer to the charge that dangerous socialistic proposals have been responsible for the position in which Australia finds itself to-day.

Senator Herbert Hays:

– What does the honorable senator suggest should be done?

Senator RAE:

– My advice to the honorable senator and his friends, is to awaken from their Rip Van Winkle slumbers, and adapt their policy to. the needs of the times. Legislative proposals that may have been suited to the needs of the people 50 years ago are in these days, not only obsolete, but absolutely dangerous. This attempt to restore prosperity by impoverishing the workers, and gaoling those who dare to show their discontent, is bound to fail. No matter how well intentioned honorable senators may be individually, when the party whip cracks they will be found supporting the Government in every piece of repressive legislation which it cares to introduce. The booklet shown by Senator Hardy yesterday contains seventeen pages setting out the achievements of the present Government, which, when analysed, are hardly worth talking about.

Senator Brennan:

– The honorable senator has not yet, answered the question put to him by Senator Herbert Hays.

Senator RAE:

– I have no intention, al this stage, of propounding a scheme to remedy the existing state of affairs; but if supporters of the Government will take a hint, they might read the Labour policy. It will give them the desired information.

We have arrived at a stage when we must acknowledge that the real rulers of every capitalistic country are the banks and financial institutions, and that if the people wish to be supreme, they must own and control the banking “ system. That is part of Labour’s policy. If adopted, it would benefit, not only the workers, but also the middle classes, and especially all those land-owners and farmers who are perishing under the existing system.

Senator Herbert Hays:

– But why attack the banks?

Senator RAE:

– I am attacking not the banks, but the banking system which subordinates ‘the interests of the community to the monetary interests of the fe.w. While honorable senators may make all sorts of contemptuous remarks concerning our attitude towards the banking system, it may interest them to know that similar views have been expressed recently by many people who have no affiliation’ with Labour, including some of the leading publicists and financial and economic authorities of our time.

Senator Collings:

– Mr. Norman, the Governor of the Bank of England, is not certain about the future.

SenatorRAE.- That is so. Mr. Norman is, I suppose, rightly regarded as one of the leading financiers of the world, and lately he has admitted that, he does not know what to do under existing conditions. Even the clergy who, in ordinary circumstances, support the existing system, are departing from their orthodox custom ; some are beginning to realize that the Christianity which they preach cannot be practised under the existing social system.

Debate (on motion by Senator

O’Halloran) adjourned.

Senate adjournedat 3.33 p.m.

Cite as: Australia, Senate, Debates, 2 June 1933, viewed 22 October 2017, <http://historichansard.net/senate/1933/19330602_senate_13_140/>.

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