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Wednesday, 15 August 1906

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) . - I am very reluctant to depart from any unanimous recommenda-tion of the Tariff Commission, and would only do so if I thought that the case made out for an alteration of any such recommendation had not been sufficiently answered. So far I do not think that we have had a sufficient reason given for the different treatment which the Commission recommended should be accorded to brandy distilled wholly from grape wine and brandy which, is distilled partly from grape wine and partly from other materials. If it be a fact that the former article is a more wholesome one, in addition to being a more legitimate article, I would extend a preference to it much more readily than I would offer a preference to one particular set of manufacturers as against another set of manufacturers. I would grant a preference for purity and wholesomeness much more readily than I would a mere protective preference. If it be admitted - and the Tariff Commission appears to acknowledge it - that pure grape brandy is a better article than is blended brandy, there is good reason why we should make a distinction which would encourage its consumption. The distinction which existed when the Tariff Commission dealt with this matter was greater than that which would be made under its own recommendations. For instance, the Commission recommends a reduction of the Excise duty upon spirits distilled wholly from grape wine of is. per gallon as against a decrease in the Excise duty upon blended brandy of 2s. per gallon. That is a difference of 100 per cent. Unless reason can be shown to the contrary, it seems to me that the effect of adopting the recommendations of the Commission would be to discourage the use of the purer and more wholesome article. The honorable member for Parramatta stated - and I think that the honorable and learned member for Parkes took him up wrongly in this connexion-

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - What does the honorable member mean by " wrongly " ?

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - The honorable member for Parramatta merely quoted the letter of Mr. Penfold, for the purpose of accentuating his belief that there was a great difference between the cost of production of the two articles. He did not quote that gentleman's communication as the reason why he held that view.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - I referred to the matter only as an illustration of what I considered a wrong method.

Mr DUGALD THOMSON (NORTH SYDNEY, NEW SOUTH WALES) - I think that the honorable and learned member misunderstood the honorable member for Parramatta, who believed that there was a marked difference iri the cost of production, and used the figures in question merely to support that opinion. The evidence and the knowledge that I have obtained from other sources leads me to believe that the cost of producing pure grape wine brandy is considerably higher than is the cost of producing the blended article. If that be so, and any encouragement is to be given to the pure article, a sufficient margin must Le allowed' between the Excise duty on the two. It has not been proved to my satisfaction that that encouragement will be given if the difference that has previously existed be reduced. I am anxious to support the recommendation of the Commission, but if I cannot be convinced on that point, I shall have to support the proposal of the Government to allow a greater difference. I do not think that sufficient reason has been shown for reducing the Excise on grape brandy by is. per gallon, and reducing the Excise on blended brandy bv 2s. per gallon..

Sir JOHNQUICK (Bendigo) [10.1 81. - I wish to deal as briefly as possible with one or two points that have been raised. In the first place, the honorable and learned member for Parkes asked why the Commission had recommended a protection of 4s. per gallon in respect of brandy distilled wholly from grape wine, and of 3s. per gallon in respect of blended brandy. The reason is that the blend was to consist partly of grape wine spirit and partly of spirit obtained from- other materials, but was to comprise mot less than 25 per cent, of pure wine spirit. As a matter of practice, a blend may consist of spirits derived from molasses, grain, or other distilling material. Too much stress has been laid upon the fact that cheap molasses costing only 9d. a gallon is, or will be, used in blending. As a matter of fact molasses spirit is not exclusively used for that purpose. According to the evidence it is sometimes used, but grain spirit is also employed. Honorable members will see on turning to page 24, paragraph 3, of the report, that the grain spirit which mav be so used costs from 2s. 9d. to 2s. nd. per gallon. That being so, the average cost of spirit used for blending, instead of 9d. per gallon, is more likely to be is. 6d. or 2s. per gallon.

Mr Watkins - How does that compare with the cost of crape spirit?

Sir JOHN QUICK - Grape spirit costs about 4s. per gallon. When, we require that for blending purposes 25 per cent, of grape spirit shall at least be used, and that the rest of the blend shall comprise spirit made from grain or molasses, we must recognise that the cost of the blending material will certainly be more than 9c!. per gallon. The Commission thought that a fair, rough and ready calculation showed that it would be sufficient to give blended spirit an advantage of is. per gallon less than that enjoyed by the pure article. In dealing with a question of this kind the measure of protection cannot be indicated with mathematical or logical certainty. The calculation made by the Commission was a rough and ready one, based upon the difference in the cost of the materials used, and upon the supposition that sometimes 50 per cent, or 75 per cent., instead of 25 per cent., of grape spirit might be employed. I submit that our estimate that a difference of is. is sufficient to allow is just as likely to be correct as is any other estimate that has been put before the Committee. It is based upon evidence, but it appears that our conclusion is to be rejected. If it is we shall not be responsible, but shall bow respectfully to the decision of the Committee. I should like to point out further that the recommendation to allow a difference of only is. and a protection of 3s. per gallon, as against the protection of 4s. per gallon in the case of the pure standard brandy, is based upon evidence that the raw material out of which the blended brandy is to be made may not average od. per gallon, but more like 2s. per gallon. I think' that is sufficient to justify our recommendation. However, the question is an arguable one, and its final decision rests with the Committee. Ap'parently under the guidance of the Committee the House will propose to reduce from 3s. to 2s. per gallon! the protection which we recommend should be given to blended spirit. In reply to the point raised by the honorable member for Coolgardie, I should like to mention that the words " similar process " were inserted after the words "brandy distilled wholly from grape wine bv a pot still," so as not to exclude the Coffey patent still which is used in some of the great distilleries in the States. They were designed to allow the use of the patent still, provided it be so managed as to yield results substantially similar to those obtained from the use of the pot still. Bv means of the pot still spirit is distilled in such a way as to retain the natural ethers or the natural volatile elements and characteristics of the true brandy or whisky. It was admitted by most of the witnesses that when run at high pressure and strength, the patent, still will not yield that result, but that it may be so managed that it will do so. We do not wish to exclude the patent still. In settling the wording of this clause, 1 consulted a trusted Excise officer who assured me that these words will not exclude the patent still provided that it is so managed as to yield results substantially , similar to those obtained from the pot still.

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