Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Wednesday, 26 May 1926

Senator H HAYS (Tasmania) . - I suppose we all accept the position that protection is the policy of the Commonwealth. The day for arguing whether its policy should be protection or freetrade has long since gone. But what concerns many honorable senators, as well as myself, is whether there should be any limit to the extent of the protection we afford Australian industries. I think we can very well take a lesson from the history of the State of Victoria, which has always been protectionist. The general policy of protection is to bring about the establishment of secondary industries, and it has always been contended that once an industry is firmly established any alteration of Customs duties should be to reduce rather than to increase them. I think it must be admitted that such has not been the experience in Australia. Every time a Customs tariff bill has been before this Parliament it has been introduced for the purpose of affording further protection to secondary industries.

Senator Findley -Do not forget that in this bill certain duties are to be reduced.

Senator H HAYS - There are certain reductions proposed, but mainly in connexion with items that are not being manufactured in Australia. Before we proceed to substantially increase our Customs duties, it is well for us to take stock and consider the progress that our industries have made. Senator Duncan has said that high duties are necessary to prevent goods manufactured under cheap labour conditions in other countries from coming into competition with the products of Australian secondary industries. Whatever may be the experience of other countries in that connexion, I think we must all have arrived at the conclusion that there is never any likelihood of any of the products of our secondary industries being exported. I should like honorable senators to correct me if I am wrong when I say that Australia stands in the unique position of being a country whose policy it is to establish secondary industries, but yet is not able to export any manufactured' goods.

Senator Findley - We have not yet raptured the home market.

Senator H HAYS - That is all very well, but we must realize that, despite our high tariff, our imports are now heavier than they have ever been.

Senator Reid - The Sunshine harvesters are exported.

Senator H HAYS - I make that one exception. Sunshine harvesters do a little trade with South America.

Senator Reid - The Sunshine harvester industry was built up by protection.

Senator H HAYS - I do not subscribe to that view. The success of the Sunshine harvester industry is due to the magnificent inventive genius of one man who, by specializing in that one line, has produced a harvester which is unrivalled. With that exception, I challenge any honorable senator to say that Australia, with all its advantages, can manufacture an article and export it, at a profit, to any other market in the world.

Senator Findley - Yet we send away jams and tinned fruits.

Senator H HAYS - If we are exporting jams, the quantity is verylimited indeed.

Senator Crawford - I think that the value of our export of jams last year was £80,000.

Senator H HAYS - The export of jams is supported by the payment of a bounty.

Senator Crawford - There is no bounty on jams.

Senator H HAYS - There is in one sense a bounty. If the manufacturer of jams gives a certificate that portion of his output has been sent overseas, he gets a rebate on the cost of sugar he has used in respect of that proportion.

Senator Findley - What about tinned fruits ?

Senator H HAYS - Exporters of tinned fruits and dried fruits are assisted by the Commonwealth Government. I am not arguing against protection, but I claim that we should take stock and see where we stand. I am doubtful whether the increased duties now proposed or the duties now existing have stimulated secondary industries to the extent anticipated by those responsible for the introduction of the present tariff some years ago. Nothing would give me greater pleasure than to know that these increased rates would bring about increased production, and so establish our manufacturers that they would be in a position to export their surplus output; but as I cannot see any prospect of that happening, I hesitate to give my support to the schedule now before the Senate. I do not know just how far the Tariff Board has investigated the industries applying for protection to see that their methods of manufacture are up to date. High protective duties tend to encourage slovenliness and inefficiency. There is too much inclination to rely on increases of duties rather than on the better organization of plant and staffs, or on the application of more scientific methods to secure a high state- of efficiency, which would enable industries to meet the competition of others. Senator Duncan has endeavoured to show that the primary producer reaps great advantage under a high measure of protection for secondary industries. Some primary producers may derive benefit from a protective tariff, and I suppose we must all admit that their best market is the home market, but I . ask those who make this claim,. " Where does the primary producer really come in under a high protective tariff?"

Senator Crawford - There are protective duties on primary products. Take oats, for instance.

Senator H HAYS - Yes. There is also a duty on potatoes, but does the Minister believe that the duty of fi on potatoes is consistent with the duties set out in the schedule now before us, or even in the existing tariff? He must admit that it is not.

Senator Crawford - That duty is to prevent competition from potatoes grown in a country where the industrial conditions are very similar to those in Australia.

Senator H HAYS - Does the Minister apply the same principle to goods manufactured in America, where the secondary industries are carried on under conditions similar to those in Australia? There is a general disposition on the part of those supporting high duties to safeguard secondary industries, entirely overlooking the requirements of those engaged in primary production. Whilst it is desirable to manufacture agricultural machinery in Australia we cannot overlook the fact that during the last ten years prices have been increased by over 50 per cent.

Senator Elliott - In some instances they have been reduced.

Senator H HAYS - There has been a reduction during the last three years.

Senator Elliott - Binders which were selling at £98 can now be purchased at £68.

Senator H HAYS - The last quotation I received was £80. Three years ago binders were sold at £100, but ten years ago they could be purchased for £38. As the Australian climate is favorable, the standard of living high, and the wages paid compare more than favorably with those prevailing in any other country, it is reasonable to expect greater efficiency and an increased output; but our output per head does not compare at all favorably with that in other countries. It is not due to inability on the part of our workmen, but the lack of satisfactory organization.

Senator Crawford - We have not mass production such as they have in other countries. We cannot expect it with our limited markets.

Senator H HAYS - Possibly so; but more effective organization would be the means of increasing production and reducing costs. Within the last few days negotiations have been satisfactorily completed for the grouping of those interests concerned in the hat-making industry in Victoria.

Senator Foll - A referendum will shortly be taken on the question of whether the Commonwealth Parliament shall have power to deal with trusts and combines.

Senator H HAYS - The operations of trusts or combines may result in cheaper production.

Senator McLachlan - Then trusts or combines may be beneficial.

Senator H HAYS - In some cases they are. Those engaged in the distribution of petrol in Australia have organized their forces in such a way that petrol is cheaper, and as a result of the grouping of these interests the internal combustion engine has been brought into use and its usefulness developed. The combinationof shipping interests has resulted in increased wages being paid, in better conditions, and in the passenger accommodation and services generally being improved. If mass production, which reduces overhead expenses, were adopted in Australia many of our industries would be more firmly established and their products made available to the public at lower prices. As honorable senators are aware, the timber industry is languishing; and if protection, which is the established policy of the Commonwealth, is to be adhered to, greater consideration must be shown to those engaged in that industry.

Senator Foll - The price of Australian dressed timber is very high.

Senator H HAYS - Yes, but when one considers the circumstances under which it is produced - the high price of saw-milling machinery, the observance of Arbitration Court awards and conditions, and high freights, the result of the Navigation Act - the price charged can be justified. The timber industry is being crushed out of existence as the result of heavy importations of timber, which, although carried many thousands of miles, can be landed in Australia at a cheaper rate than we can produce it. Those engaged in the timber-getting industry have, to use machinery and plant on which heavy Customs duties are imposed; they have to pay wages awarded by the Arbitration Court, and have also to contend with disabilities in the matter of transport which have arisen in consequence of the passing of the Navigation Act. In these circumstances it is impossible for the Australian timber industry, without increased protection, to compete with overseas competitors. Parliament has passed legislation which has imposed heavy burdens on the industry, and it is, therefore, the duty of Parliament to see that the timber industry does not suffer.

Senator Grant - Does the honorable senator suggest that importation of foreign timber should be prohibited ?

Senator H HAYS - No, but the Australian timber industry should receive the same measure of protection as is afforded to other secondary industries. As imported dressed timber is used for flooring, weatherboards, and linings in place of Australian dressed hardwood, the duty on imported timbers should be increased to compel the dressing to be done in Australia.

Senator Grant - That applies only, to Norwegian timber.

Senator H HAYS - No.

Senator Grant - Does Canadian timber come here dressed?

Senator H HAYS - It is cut in sizes.

Senator Grant - Not flooring.

Senator H HAYS - I am speaking of the Scandinavian timber. Imported timber, which comes in dressed, is used for linings, weatherboards, and flooring, and on- this a heavier duty should be imposed in order to encourage the Australian industry.

Senator Foll - That would mean increasing the cost of workmen's homes.

Senator H HAYS - It would provide further employment for Australian workmen. The timber industry has been established in Australia for many years, and as foreign timber is being imported at the rate of 1,000,000 feet a day, to the detriment of our own timber, heavier duties should be imposed.

Senator Grant - Why not prohibit its importation.?

Senator H HAYS - I do not suggest that. We are imposing heavy duties to support secondary industries, and if we are consistent we should also protect the timber industry. When the validating Customs Tariff Bill was before the Senate some months ago I intimated that although I was supporting the measure, I reserved the right when the schedule was before the Senate to vote on the different items as I thought fit. I do not desire my action in supporting the second reading of this bill to be taken as an indication that I shall support every item in the schedule.

Debate (on motion, by Senator Hoars) adjourned.

Suggest corrections