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Wednesday, 29 November 1944

Mr ABBOTT (New England) .- The purpose of this bill is to establish the aluminium ingot industry in Tasmania. A commission of four persons is to be appointed to inaugurate and manage the enterprise. The Commonwealth Government and the Tasmanian Government will each contribute £1,500,000 to the capital of the concern. It has been stated that the Commonwealth representatives will be Mr. A. V. Smith, secretary of the Department of Supply and .Shipping, and Dr. Wark, of the Council for Scientific and Industrial Research, and the Tasmanian representatives will be Mr. L. R. Benjamin, manager of the newsprint manufacturing enterprise of Tasmania, and Mr. Williams, Director of Mines of that State. It would appear that only one of those four persons has ever had any practical business experience. What strikes me as most remarkable in this set-up is that, although the two governments will subscribe £3,000,000 between them, no provision has been made for a Treasury representative to be a member of the commission. Usually, when large sums of pu'blic money are to be invested in an enterprise of this kind, care is taken that a Treasury official shall be appointed to the managerial body. I hope that the Attorney-General (Dr. Evatt) will take special notice of my reference to the omission to make provision for such an appointment in this case. At least it can be said that no harm could be done by, and much good might follow, the appointment of a Treasury representative to the commission. I hope that, at a later stage, the Government will accept an amendment to provide that such an appointment shall be made.

When it was first suggested, some years ago, that the manufacture of ingot aluminium should be undertaken in Australia, there was a world shortage of this vital metal, due, of course, to war conditions. That is no longer true. We have been informed that the productive capacity of the United States of America is now 1,1S0,000 tons per annum, whilst that of Canada is 500,000 tons per annum. Over-production 'in America has become so serious that the output of the American factories has been reduced by 33 per cent. It is estimated that the Australian post-war demand will be 6,000 tons of aluminium per annum. Our prewar consumption was only 1,700 tons annually. Without doubt, the post-war use of aluminium will be much larger than our pre-war use of it, but we should know, with more assurance, what the position is likely to be prior to entering upon this project.

I have listened to many of the speeches that have been made on this measure, and they have been most remarkable for cant, hypocrisy and humbug.

Mr Lazzarini - The speeches have been made mostly by honorable members opposite.

Mr ABBOTT - In the kingdom of the blind, the one-eyed man is always king. The Minister for Home Security (Mr. Lazzarini) would be a serious contender for that title, for he is the most one-eyed individual I know. The principal theme of the speeches made in support of this bill has been that aluminium is absolutely essential to the security of Australia. The honorable member for Denison (Dr. Gaha) and, later, the Minister for Munitions (Mr. Makin) both told us that, for security reasons, .we must make Australia selfcontained. The aluminium position in the world to-day is such that it would not make one iota of difference to our security if we postponed further consideration of this bill until the whole matter had been investigated and reported upon by .the Tariff Board. For that reason, I intend to support the amendment of the Leader of the Australian Country party (Mr. Fadden).

One of the most remarkable provisions of the bill is contained in clause 7, which reads -

Subject to the provisions of this act and of the agreement, it shall be the duty of the commission, with all possible expedition, in order to promote the naval, military and air defence of the Commonwealth and its territories, to do all such acts and things as are accessary for the production of ingot aluminium, and for that purpose it shall have and may exercise the powers and functions, and shall perform the duties and obligations, of the commission set out in the agreement.

Whoever drafted this bill must have blushed with shame when he prepared th at clause. It is pure hypocrisy to suggest that expedition in the establishment of this industry is necessary for the security of Australia or for the earlier winning of this war. Nothing that we can do in regard to this industry can contribute in any way to the winning of this war, but, unless we are careful, we may do something that will hinder the achievement of that most desirable end. If we rush into this industry, we "will divert man-power from other essential industries. I direct the attention of honorable members to the following quotation from the September issue of Facts and Figures which the Minister for Information makes available to the public -

There was growing evidence that Allied supply plans might be embarrassed unless there was a further redistribution of Australian labour. The Prime Minister announced moans by which some of the deficiencies could be remedied.

It is absolutely essential to the successful prosecution of the war, particularly in the South- West Pacific Area, and in Naziridden Europe, that we shall maintain the supply of vital footstuffs to the Allied armies. All honorable members have received numerous letters from their constituents concerning the need for more man-power for essential food production industries. One of these is dairying. We must maintain maximum production in this industry in the interests of both the Commonwealth itself and our Allies. Only to-day I received a letter from the wife of a dairyman in my constituency who is at present in the forces, telling me that although her husband is B class, and 45 years of age, she cannot obtain his release, and is therefore obliged to continue to try to carry on a dairy farm with the help of only one daughter fourteen years of age. That is not an unusual case. It is for this reason, among others, that I say that it is not serving the best interests of the war effort for the Government to proceed with this enterprise at this stage.

The bill states that the commission should take up its work - with all possible expedition, in order to promote the naval, military and air defence of the Commonwealth and its territories.

Mr Frost - Hear, hear !

Mr ABBOTT - The Minister for Repatriation would say " hear, hear " to anything. The honorable gentleman would be much better engaged in trying to increase production in our vital foodstuffs industries.

There is another important aspect of the whole proposal which should be inquired into by a responsible and independent authority, such as the Tariff Board. It may be, though at this stage I do not say that it will be, detrimental to the export industries of Australia to proceed with this project at present. Such action may seriously interfere with the post-war export prospects of not only our primary industries, but also some of our secondary industries which hope to gain a footing in world markets after the war.

It has been put to us that if the Government establishes this industry under government control, aluminium production in Australia will be free from the influences of the international cartel which has had such an important effect on aluminium production in other countries. I consider that it will be impossible to keep this industry free from the influences of the international cartel, which, as honorable members know, has practically crucified those outside the cartel who have endeavoured to manufacture ingot aluminium abroad. It is worth noting, however, that although the Government is taking this step to establish ingot manufacturing in Tasmania, the Australian Aluminium Company controls the fabrication plant at Granville, near Sydney, where one of the largest forging hammers in the world has been installed with the help of government funds. I do not believe that anyone ever envisaged the possibility of that great hammer being handed over to the representatives of one of the most concentrated financial groups the world has ever seen. I understand also that the fabrication plant at Wangaratta is under the control of the same company. Of course, we know that one of the close associates of this great citadel of finance in Australia, which also has world-wide contacts, has accompanied a member of this Government on his journeys overseas, and has been instrumental in introducing him into the best circles of the highest social life of the capital cities of the United States of America and Great Britain. He is representative of the people who will control this industry and to whom assets paid for by Commonwealth funds are to be released. I believe I am correct in saying that only one small fabrication plant in Australia is at present operating outside of the combine. I suggest that the handing over of the fabrication plants in the Commonwealth to the combine will absolutely strangle this industry at birth. The ingot manufacturing branch of the industry will have no power to struggle effectively against the cartel, which will be able to fix prices to suit itself; and the industry will ultimately come under private control, as did the carbide industry in Tasmania, in circumstances which the Minister for Repatriation so eloquently explained to us yesterday. The industry was eventually taken over by the Government of Tasmania, which could not manage it and had to hand it to private, enterprise.

Mr Frost - It has been a godsend to Australia since the outbreak of the war.

Mr ABBOTT - I say to the defender of cartels and combines-

A Government Member. - Ha, ha!

Mr ABBOTT - It is all very well to say " Ha, ha ". A donkey is judged by the load it carries on its back, not by its bray. The Government is placing on its back a load in the form of the greatest combine that exists in the world. I shall give the pedigree of the Australian Aluminium Company, and shall show that its relatives throughout the world are tied up with the greatest cartels and combinations that the world has ever had.

It looks as though the government factory could quite easily fail, because there will he no purchaser of its product, the potential buyers being more interested in obtaining control of the industry than in having it run by the Government. Should it fail, the combination will purchase it at scrap value. Probably, even now, it is rejoicing and thanking Heaven for what the Government is doing, in the belief that later it may be able to obtain the factory cheaply.

Mr Frost - That would be likely only if there were a change of government.

Mr ABBOTT - Honorable gentlemen opposite make rash statements about what happened in the past. We did not hand the manufacturing industries of Australia to those combines and cartels which our friends opposite loudly condemn on the hustings, but accept as blood brothers when they have the opportunity to associate with them.

I shall give to the House information concerning the history of the Australian Aluminium Company - its shareholders, associates, and directors. In November, 1936, a company was registered, styled British Aluminium (Australia) Proprietary Limited, and Sir Colin Fraser and Mr. A. J. C. Bult, of 360 Collinsstreet, Melbourne - more popularly known to my friends on the Government benches as " Collins House " - were the first directors. In 1939, the name of the company was altered to Australian Aluminium 'Company Proprietary Limited, and it had its registered office at 360 Collins-street, Melbourne. At, this time, it was announced that one-third of the capital was being supplied by Electrolytic Zinc Company of Australasia, and that the balance was being supplied by overseas interests, who were reported to be Aluminium Limited, of Canada, owned and controlled by the Aluminium Company of America - Alcoa - and British Aluminium Company Limited. A search at the titles office revealed that in April, 1940, the shareholders were: Electrolvtic Zinc Company of Australasia Limited; Metal Manufactures Limited; British Aluminium Company, Limited; Aluminium Limited, Montreal, Canada; and Aluminium Limited, Geneva, Switzerland. Electrolytic Zinc Company of Australasia Limited, and

Metal Manufactures Limited held approximately one-third of the capital, whilst British Aluminium Company Limited also held one-third, and the balance was held by Aluminium Limited, Montreal, Canada, and Aluminium Limited, Geneva, Switzerland. I may mention that Aluminium Limited, Geneva, Switzerland, is the organization through which the American company carried on its business in Norway, Germany, Italy and Japan. The directors of Australian Aluminium Company Proprietary Limited, in June, 1940, were Sir Alexander Stewart, Sir Colin Fraser, John Seymour Toulon, William Sydney Robinson, Lawson Greene Bash, Norman Warren Waterhouse, and Leslie Vickery Waterhouse. Alternate directors were Sir Walter Massy-Greene, Henry St. John Somerset, and Aubrey John Clifton Bult. Mr. Lawson Greene Bash is an American citizen, whose address was given as Montreal. Together with Mr. Norman Warren Waterhouse, he represents the interests of the Aluminium Company of America - Alcoa. The remaining directors represent between them the interests of Electrolytic Zinc Company of Australasia Limited and British Aluminium Company Limited. A search at the Titles Office on the 30th June, 1941, indicated that Aluminium Limited, Geneva, had disappeared from the shareholding register. Apparently, this shareholding had been transferred to Aluminium Limited, Canada. The position of the company then was: Electrolytic Zinc Company of Australasia Limited, and Metal Manufactures Limited, 150,000 £1 shares; British Aluminium Company Limited and Aluminium Limited, Montreal, Canada, 150,000 shares each. The directors were the same as they had been at June, 1940, with the exception that Mr. W. S. Robinson had retired from the board and Sir Walter Massy-Greene, who previously was an alternate director, became a full director. I understand, and the honorable member for Richmond (Mr. Anthony) has made it perfectly clear, that Mr. W. S. Robinson, Sir Walter Massy-Green, and many of the other gentlemen mentioned, are members of what is called the Collins House group, which in the past has been anathema to the Government ; yet the Government has demonstrated openly to-night that that is no longer the case, but that in reality these people belong to the same brotherhood as the Government and should be treated in the best possible way. The articles of association provide that two directors shall be nominated by British Aluminium Company Limited, Aluminium Limited, Canada, and Electrolytic Zinc Company of Australasia Limited and Metal Manufactures Limited. It will thus be seen that four of the six directors of the company to which the Government has seen fit to hand the fabrication of aluminium in Australia, are directors of overseas corporations which are tied up with the great aluminium cartel. The shareholding discloses that Australian Aluminium Company Proprietary Limited, as at present constituted, is controlled by nonAustralian interests so far as its capital and directors are concerned. Both British Aluminium Company Limited and Aluminium Limited, Canada - which is owned by Alcoa - were members of the original aluminium cartel formed in 1904, when the price of aluminium had fallen to the lowest figure on record, namely, £60 a ton. They were also members of the same syndicate or cartel formed in 1909. On the outbreak of the 1914-18 war, aluminium was selling for approximately £85 a ton, but during that conflict it rose to £220 a ton, through the instrumentality of these patriotic gentlemen. A very large development of the American and Canadian production was financed out of war profits. The price did not fall below £100 a ton until 1922, and it was more or less maintained at that figure until the outbreak of the present war in 1939, when it was pegged at £110 sterling a ton by the British Ministry of Supply. The international aluminium cartel is world wide, and operates in all the producing countries with the exception of the Union of Soviet Socialist Republics. Even in Nazi Germany Aluminium Limited of Geneva - which until some time in the war was tied up with Australian Aluminium Company Proprietary Limited - held large interests, particularly through interlocks with the German I.G. Farben Industrie, tho great German dye, chemical and metal trust. It will, therefore, he seen that the controlling interests in Australian Aluminium Company Proprietary Limited represent two of the oldest and strongest members of the great international combine. Since the fall of Prance and the attack on Pearl Harbour, the aluminium industry has been increased stupendously. Millions of pounds of British, Australian and American money has been poured into it. It is reported that Australia has invested £1,000,000 in Aluminium Limited, Canada, for the development of power schemes. The production of Canada has been increased to 500,000 tons per annum, the whole of it monopoly-produced. The production in the United States of America has been increased to 1,180,000 tons per annum, 95 per cent, of which is produced by Alcoa. The debates in the Canadian Parliament last year clearly stated the policy of the cartel in relation to the protection of this vital industry. This is the largest combine for the production of light metals in the world. Curiously enough, the present Government has a particular flair for cultivating combines of this sort. Only recently, we were told that Courtaulds Limited is to be established in Australia for the manufacture of rayon and nylon. It is a part of the great world rayon combination, and prior to the war had cartel agreements with the rayon combine in the United States of America as well as with that other monopoly, I. G. Farben Industrie, Germany. It may interest honorable members to know that I. G. Farben Industrie was such an enormous concern before the war that it had 163,000 persons on its paysheets. These are the interests to which the Australian industry is being handed, without proper protection. An inquiry by the Tariff Board into the agreement is absolutely essential. That body should investigate the handing over of the fabrication plant to the company whose history I have given to-night, and the persons whose personal history was given this afternoon by the honorable member for Richmond (Mr. Anthony). I am not in a position to say whether or not any other areas in Australia should be developed. I received this afternoon a telegram from northern New South Wales, suggesting the development of hydro-electric schemes and bauxite deposits in that region. I cannot say whether or not these have a preferential right to be developed before the resources of Tasmania or any other part of the Commonwealth. But I do contend that there should not be a handing over of this industry to any part without a proper investigation of the resources of all parts; and the Tariff Board is the proper body to make that investigation. It should inquire as to whether or r.ot the aluminium industry could he carried on more economically and with better chances of successful development in the post-war period than could many other industries. Australia has not unlimited man-power. It is stupid for the Government to consider, as many Ministers have stated during the debate, that the Commonwealth must bc absolutely self-sufficient. It is impossible for 7,000,000 people to be self-sufficient in relation to all of their requirements. If we embark on such a policy, it will not be long before we shall revert to the self-sufficiency represented by the oyster middens of the aborigines at Port Jackson prior to the arrival in Australia of the white man. There should be a proper selection, of the industries we are to establish, and a determination should be reached as to whether or not those chosen will utilize our man-power in the best possible way.

For the reasons I have given, and particularly because of the possibility of the industry being strangled by a great combine, I consider that the closest investigation by the Tariff Board is warranted before the bill is proceeded with further in the Parliament of the Commonwealth.

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