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Tuesday, 3 May 1932


Mr GULLETT - The present intention is to proceed with the debate on those items which have been amended by this Government, and consequently the first proposal incorporates practically all of those items. Where the Government has decided to revert to the tariff rates and wording of 1921-28, the items do not, of course, appear in either schedule. In a few instances the items which have been amended by this Government have had to bo incorporated in the second schedule, because of difficulties arising in drafting. I can give the committee the assurance, however, that practically all the important changes effected since the Government assumed office are contained in the schedule which it is proposed to debate within the next few days. The second schedule incorporates those items which will not be debated at present. First, there is the schedule introduced by the Scullin Government, and validated prior to the last election.


Mr Gregory - Temporarily.


Mr GULLETT - That is so. This Government introduced a number of amendments to that schedule, but. instead of revalidating it, substituted another resolution covering the amended schedule as a whole. I am now separating the amendments introduced by this Government from the other items of the Scullin schedule so as to give the House an immediate opportunity to discuss them. There is no time available just now for the consideration of the whole of the amended Scullin schedule, but we are fulfilling our undertaking to the House to provide immediately an opportunity to debate the tariff changes made by this Government. The first decrease in duties relates to item 105 k. Piece goods, wool or chiefly of wool and admixtures of wool and silk for the manufacture of neckties, are reduced from 20 per cent., British, and 25 per cent., foreign, to 10 per cent., British, and 20 per cent., foreign. This represents the raw material used by tie manufacturers in this country. Another decrease is in item 114 e - "Wool felt hoods for girls' and women's hats. By amending the wording of this item the fixed rates of duty are reduced from 45s. a dozen, British, and 60s., general, to 20s., British, and 30s., general. The duty on item 170 a - dredging and excavating machinery of navvy and similar types of a working weight exceeding 75 tons - is being reduced from 27½ per cent., British, and 40 per cent., general, to free, British, and 10 per cent., general.

I now come to the only instance in which duties have been increased. This is item. 392 a - cotton yarns. The duty on these is being increased from 35 per cent., British, and 55 per cent., general, plus 3d. per lb. to varying rates. From count No. 1 to No. 12, a flat rate' of duty of 4d. per lb., British, and 7d. per lb., general, is being imposed. From count No. 13 to No. 31 an additional flat rate of¼d. per lb., for each count above ' No. 12 will operate, and from counts No. 32 to No. 49 a flat rate of 9d. per lb., British, and1s. per lb., general, will operate. In all cases these flat rates will be in addition to the existing ad valorem duty of 35 per cent., British, and 55 per cent., general. In the case of folded yarns, being combinations of any count from No. 1 to No. 49, the fixed rate of duty shall be payable on the resultant count.

Only two of the alterations effected require any comment, and these relate to wool felt hoods for girls' and women's hats and cotton yarns. In the case of wool felt hoods, I propose briefly to review the changes in duty. In 1928 the duties were -

 

In November, 1929, the fixed rates were increased to 20s., British, and 30s., general. In March, 1931, the rates were not altered, but by amending the wording to exclude such hoods as were not in conical shape, and which had been proofed, tipstretched, sandpapered or polished, hoods which complied with the trade definition of a hood were made dutiable at per dozen 45s., British, 60s., general, or 45 per cent, and 60 per cent. In other words, duty was being charged on these hoods at the same rates as those charged on the completed hat. The wool felt hood item, therefore, became redundant, and by reason of the changed wording the rates of duty became prohibitive, and large quantities of hoods were bonded, and have not since been cleared. The cost of these hoods, which were dutiable at 45s. a dozen, British, was only about 17s. or 18s. a dozen. Between 4,000 and 5,000 dozen have been bonded ever since. The position has arisen that local wool felt hood manufacturers cannot supply the demand, and millinery manufacturers are putting off hands because they cannot purchase supplies of hoods. One large millinery manufacturing establishment has been forced to dispense with a large number of employees. It will be appreciated by honorable members that to allow thousands of pounds worth of fashion goods to remain in bond for a lengthy period, particularly when such goods have been paid for by the Australian purchaser, constitutes both an individual and national loss. The amending of the wording of the item should allow the hoods now in bond to be cleared, and will result in increased employment in the millinery trade, No hardship can possibly accrue to Australian hood manufacturers as they have already been booked up to their capacity for the remainder of the season. The manufacturers in Australia agree to this proposed reduction of duty. The season has been a peculiar one with respect to orders, not only in connexion with wool felt hoods, but with respect to many classes of textiles as well. After a very slack season last year, resulting in considerable unemployment, there has come, within the last two or three months, an unexpected rush, of orders. The explanation probably is that retailers, and even wholesalers, have been holding off because of the uncertain financial position, until their stocks have become exhausted. Now the orders are coming in so quickly that the manufacturers are unable to increase their output quickly enough.


Mr Gregory - Is the new duty to be wholly ad valorem ?


Mr GULLETT - No ; it is an alternative duty. The Government is pursuing its policy of not making any drastic changes in duties without receiving a report from the Tariff Board. The duty of 20s. a dozen British, is still equivalent to 100 per cent, ad valorem, and thi3 gives some idea of the amount of protection which the last Government deemed necessary, when it fixed the duty at 4.5s. a dozen. The whole subject of duties on hoods and hats has been referred to. the Tariff Board.

The Government has, since the introduction of the cotton yarn tariff resolution of March last, given further consideration to the duties on cotton yarns. With the rapid development of the spinning industry in Australia, the position would have arisen that the bounties on cotton yarn would amount to well over £100,000 annually. Indeed, we expected it to reach that sum in the next financial year. Some idea of this rapid development may be obtained from a perusal of the bounty payments on cotton yarns since the inception of the bounty. Details, of these are -

 

It is anticipated that for this financial year bounty payments on cotton yarns will total approximately £120,000.' Obviously, the payment^ of such a sum under present financial conditions would involve serious inconvenience, aud that was one of the factors which prompted the Government to alter the duty. Action is therefore being taken by the Government to convert the bounty-cum-duty into a straightout duty, and the present resolution is the first step in this direction. Action will be taken later to repeal the existing bounty legislation insofar as cotton yarns are concerned, as on and from the 1st July next. In the meantime, the cottonspinners have given a guarantee that they will not increase their 'prices until July next, and then only by an amount not exceeding the equivalent of the bounty which they will lose. In many cases, it is anticipated that the increase in price will bc somewhat less than the present bounty. The period which will ensue between the present time and July next should enable spinners to adjust their manufacturing activities to the new conditions. The bounty on seed cotton will continue to be paid in accordance with existing legislation.

It was previously stated that when the schedule had been divided in the form in which it now appears, the debate would be immediately proceeded with. Owing, however, to the intervention of other business, we are not able to proceed with the debate at present, even if honorable members had been ready to do so. I propose, therefore, to move presently that progress be reported, but I assure honorable members that, within a very few days, the schedule covered by the first of these resolutions will be placed before them for debate.


Mr Gregory - What does the Government propose to do with regard to the tariff schedule temporarily approved by Parliament last year?


Mr GULLETT - We are proceeding as rapidly as possible with the revision of that schedule by the Tariff Board. Recently I made a great many references to the Tariff Board, and I am carefully selecting those items as to which there has been considerable controversy. As I receive reports on those items, I shall submit the recommendations and proposals of the board to Parliament, which will be afforded an early opportunity of discussing them.

Progress reported.

Sitting suspended from 6.11 to 8 p.m.







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