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Friday, 9 October 1931

Mr SCULLIN (Yarra) (Prime Minister) . - The subject raised by the honorable member for Kennedy (Mr. Riordan-) is a very important one. I think all honorable members in this House have receivpd copies of the letter from Mr. James Clark. In that letter Mr. Clark refers to the increase in freights on wool since Lord Inchcape came into shipping. That is going back a good many years. I do not know of any increase in freight during recent years. As a matter of fact, shortly after this Government came into office, a proposal was made to increase outward freights by 10 per cent. We have no power, as a Parliament, to control freights - although Mr. Clark says that only Parliament can deal with the matter - but, nevertheless, the Government did take a stand and made representations to see what could be done to prevent a rise in freights. Prior to the accession to office of this Government, delegations representing overseas shipping companies met representatives of shippers in Australia and discussed with them the proposed increase in freights, which, they contended, was inevitable unless something could be done to regulate shipping in Australia to prevent the overlapping that was taking place, and to regulate space by means of an organization of shippers and ship-owners. Whena decision was reached that there should be no increase in freights, if that could be done. an unexpected difficulty arose in connexion with certain legislation tha: had been passed for the control of monopolies. Accordingly, they approached the Government with a requestto amend the legislation in question before they formed an association for the regulation of shipping. That amending legislation was passed, and that is the only power which we have in connexion with this matter.

Mr Holloway - Have the shipping companies violated that agreement?

Mr SCULLIN - So far as I know there has been no increase of freights since then. The writer of this letter refers to the Overseas Transport Association, of which he is a member, representing the wool-growers. Mr: Tout is chairman of this organization, which is representative of overseas ship-owners, Australian wool-growers, the butter and fruit industries, and other sections ofexporters. The writer states that the association is operating under the Federal Government. That is not correct. It is an organization entirely of shippers and ship-owners. The only action which the Federal Parliament took was to amend its legislation so as to enable the organization to operate, and I believe that it is doing good work. As we all know, wool freights have always been abnormally high as compared with freights on other exportable primary products from Australia. They have been higher because, in the overseas market, wool has always commanded a higher price than other primary products. Now that wool prices are down, these high shipping charges are a real hardship upon the industry. I have taken up this matter with the Transport Association, which is keeping me informed of every move or proposed move. At one of the conferences which I have had with Mr. Tout, it was pointed out that there was no guarantee in the agreement for the regulation of freights, and, on behalf of the Government, I refused to introduce the amending legislation unless that was provided for. After a good deal of negotiation it was included. I said that, as we had taken the responsibility of amending the legislation, if it would not prevent a rise in freights, we should have to consider what action could be taken. This question has been raised on more than one occasion by several honorable members, including, I think, the Deputy Leader of the Opposition (Mr. Latham), and the Minister for Markets (Mr. Parker Moloney) is giving it his attention. I now have an acknowledgment of my letter to the association, informing me that it is considering the position with a view to avoiding an increase in freights. I think that this is rather an important accomplishment, because we have to realize that a decline in the volume of shipping means an increase in the handling charges, so that freight increases are difficult to avoid. I agree that probably some re-adjustment of freights should be made by ship-owners in view of the low prices now prevailing for wool. It is obvious that if wool prices are low, the industry cannot carry the burden of high freight charges. I think the honorable member for Kennedy (Mr. Riordan) has done good service in raising the matter this afternoon.

Mr Morgan - Can the Prime Minister explain why the Union Government in South Africa has been able to deal with this question?

Mr SCULLIN - The honorable member must know that the Union Government is not subject to the constitutional limitations that are imposed upon the Commonwealth Government.

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