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Wednesday, 14 October 1931
Page: 738

The TEMPORARY CHAIRMAN - The Minister must not discuss an amendment which is not before the Chair.

Mr FORDE - In the course of his speech the honorable member for Balaclava said that these surcharges minimized the degree of preference given to Great Britain. If the honorable member will turn to the memorandum on page 12, he will see that in the case of motor car bodies, the protection to Great Britain has been increased from 40 per cent, to 60 per cent. As to the duties on chassis, instead of being 5 per cent., 35 per cent., and 45 per cent., British, intermediate and general, respectively, the surcharge of 50 per cent, has increased them to 7£ per cent., 52£ per cent., and 67^ per cent., respectively. It is amusing to hear the critics of the Government speaking with different voices regarding the effect of these duties. Some of. them say that the duties will make no difference whatever, because a restriction of imports would have been brought about by the rationing of credits by the banks, while other honorable members of -the same party say that these duties have increased unemployment. The Opposition cannot have it both ways. The fact is that these duties have minimized unemployment; had it not been for them many thousands more of our people' would now be out of work. The items were carefully selected by the Government, and they have also been subjected to the most careful scrutiny by officers of the department, as well as by the Tariff Board which was called into consultation. The Tariff Board was asked for suggestions as to items which might be eliminated or new items which might be inserted. The schedule contains a number of luxury lines which can" be manufactured in Australia or done without. Although Australia produces large quantities of dried fruits, it imported from other countries considerable quantities of dried fruits before these duties were imposed. Now the importation of dried fruits has been prohibited.

Mr Gabb - What about onions?

Mr FORDE - Prior to the imposition of these duties, we imported large quantities of onions, yet we have difficulty .in finding a market for those grown in Australia. As a result of representations made by growers of oranges and lemons in the Macquarie electorate, the importation of oranges and lemons has been prohibited, and Australian fruit-growers have benefited accordingly. The same may be said of pork, milk, and other commodities. The honorable member for Gippsland (Mr. Paterson) said that there was nothing wrong with having an adverse trade balance.

Mr Paterson - I said that an adverse trade balance was not necessarily wrong.

Mr FORDE - The previous Prime Minister (Mr. Bruce) was in the habit of endeavouring to justify the orgy of extravagance in which bis Go- vernment indulged. He said that there was nothing wrong in borrowing £40,000,000 a year and, in addition, importing goods valued at £150,000,000. But the end df that orgy had to come. The present Government, and, indeed, the nation as a whole, is reaping the harvest that was then sown by a government whose reckless Treasurer was the leader of the party lo which the honorable member for Gippsland belongs. The honorable member referred to the United States of America. I remind him that that country and Great Britain differ from Australia in that they are creditor nations.

Mr Paterson - At the time to which I referred, the United States was not a creditor nation.

Mr FORDE - These countries have huge investments abroad on which interest is earned. When the United States of America erected a high tariff wall against articles which competed with its

Own products it received payment in gold. The result is that that country now holds over one-half of the gold of the world, and does not know what to do with it. The honorable member for West Sydney (Mr. Beasley) deplored the policy of prohibiting imports, on the ground that it adversely affected Australian wharf labourers. To follow that lo its conclusion we should wipe, out our secondary industries and import everything. The result, however, would be the unemployment of nearly 500,000 persons engaged in our factories. The late Government encouraged imports to such an extent that many additional men were recruited to the waterfront, so that when the time came when we could no longer pay for imported goods, there was a surplus of labour on the waterfront. That labour will have to be absorbed in other avocations, as will also the 200,000 workers who were kept in employment by reason of the expenditure of loan moneys. As they cannot all be absorbed in primary production, seeing that our primary producers are already experiencing difficulty in finding markets for their products and many lines are already overproduced, they must be absorbed in secondary industries. The Government is seeking new avenues of employment. In the tobacco-growing industry there is scope for the employment of a good number of workers in growing the tobacco for which we previously paid £3,000,000 a year to the United States of America. The Government has laid the foundation on which a number of secondary industries can be built. It is wrong to say that protection has failed. The growth of unemployment is due, not to our policy of protection, but to the fall in our national income by £200,000,000 a year because of the lower prices now obtaining for our staple primary products and also because of the reduced purchasing power of the people. I ask what would have happened had these duties not been imposed, seeing that prices have fallen in other countries? But for the duties, many of our secondary industries would have had to close down altogether.

The honorable member for Warringah (Mr. Parkhill) said that an exchange rate of 30 per cent, was a sufficient restriction on imports. The Government, after consulting with a number of leading bankers, realized that a curtailment of credits by the banks was not sufficient to restrict the importation of luxury lines, and, therefore, it decided to put into effect a scientific restriction of imports. Previously, numbers of people were obtaining credit overseas by selling wool and other Australian products, and purchasing motor cars and other luxury lines with the proceeds. The banks admitted that they could not restrict such action.

Mr Archdale Parkhill - Several shipments of wool were exported in that way.

Mr FORDE - That is so. I know of an instance in which a man sold out his interests in Australia and purchased wool to the value of thousands of pounds, and established credit for himself in London by selling it there.

Mr Archdale Parkhill -Was he a politician ?

Mr FORDE - No. I do not know of any politician who could indulge in such huge transactions. The Government's action affects luxury lines, which would not be hit by a restriction of credits. The honorable member contended that the exchange rate was a sufficient protection in itself. I remind him that when the

Government took action to restrict: imports, the exchange rate was more favorable than if, is now. In April of last year, the exchange rate was about 8 per cent.; by February of this year it had risen to 30 per cent. These restrictions on imports were imposed nearly twelve months previously.

However politically biased honorable members may be, they must admit that, whereas in 1929-30 Australia had an adverse trade balance of ?3.2,000,000, it had a favorable trade balance of over ?28,000,000 in 1930-31. Since Australia has to find an additional ?9,000,000 per annum for exchange and other charges in London, making a total of over ?30,000,000 a year, it will be realized that the time has not yet arrived for taking ofl the surcharge. This is only a temporary expedient, and the Government must bc the judge of the time when it should be lifted. Sitting suspended from 6.1^ to S p.m.

The CHAIRMAN (Mr. McGrath).The honorable member for West Sydney having given notice of an earlier amendment., .1 propose to ask honorable members to consider it before dealing with that submitted by the Minister.

Amendment (Mr. Fordes) temporarily wi thd raw: i .

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