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Wednesday, 7 March 1928

Senator PAYNE (Tasmania) .- Probably no measure opens up such a wide field for discussion as does a tariff bill, nor is there upon any subject a wider divergence of opinion. I desire to make a few general remarks on the result of the tariff schedules which have been brought before this chamber during recent years. Honorable senators will remember that last year, when we were dealing with a number of important amendments to the tariff, I contended that in connexion with a number of items there was no justification for such heavy duties as were then proposed. I questioned whether certain industries which had been successfully established in Australia, and were turning out good articles, had applied for increased protection. I have since then learned that they had not done so. That is sufficient to show that the increased duties were not warranted. My prediction last year has been fulfilled ; there has been an all-round increase in the price of commodities since the last increase of customs duties, without any advantage to the community. I believe that Australia should have as many industries, both primary and secondary, as will be useful to her as a nation. Particularly do I believe that every primary industry worthy of the name ought to be encouraged to the fullest extent . possible, because upon the success of our primary industries our national prosperity depends.

Senator Kingsmill - That is true even if we are to become a great manufacturing nation.

Senator PAYNE - Yes. Last year I was called a freetrader ; but a person who is prepared, as I am, to support high duties when they are necessary is not a freetrader. A young country like Australia should have a tariff sufficiently high to ensure that every business conducted on scientific lines, and in accordance with commercial principles, will be able to pay its way; but there are, unfortunately, a number of secondary industries in Australia which we should be better without. The price that the general public has to pay for the product of those industries is beyond all reason. My opposition to the tariff last year was not to a reasonable measure of protection, but to prohibitive duties - duties which would shut out the product of British factories. I said then that, even if we had a monopoly of the manufacture of certain commodities, it would mean an increase of only £60,000 per annum in the amount paid to Australian workers as wages, whereas the increased cost to Australian workmen for the commodities which would be manufactured would be £200,000 per annum. Australia would be better off without such industries. But there are other industries which are in need of slightly greater protection in order to give them a reasonable chance to compete Avith the products of other countries, and these should be assisted.

I trust that in committee we shall deal with each item on its merits; there should be no block vote merely because the schedule has been introduced by the Government.

I desire to protest against what I consider is the unfair attitude adopted by Australia towards British manufacturers. Each year large quantities of Australian wool are purchased by Great Britain, to be manufactured into goods in that country. We expect that British manufacturers will pay us the highest market price for our WOOl

Senator Reid - They are anxious to get it.

Senator PAYNE - English manufacturers have a right to expect in the dominions a market for their goods. But by imposing excessive duties we, in effect, say to them that although' we expect them to pay us high prices for our wool, if they dare to manufacture that wool into goods, we shall erect such a tariff wall that the entry of those goods into Australia will practically be prohibited. It is not British to impose prohibitive duties on articles manufactured in Great Britain.

Senator Reid - Does not the honorable senator think that Australia should manufacture her own woollen goods?

Senator PAYNE - Yes.

Senator Reid - If that is to be done, we must have protection.

Senator PAYNE - I mentioned wool by way of illustration. Later, when the items are before us, I propose to refer to the duty on certain goods made of WoOl when I hope to show that my remarks were justified.

Senator Thompson - Is it fair to regard articles manufactured in England from Australian Wool as of foreign manufacture ?'

Senator CRAWFORD - That is not done.

Senator PAYNE - From information in my possession it would appear that goods made in Great Britain from Australian wool are regarded as of foreign origin. I brought the matter under the notice of the Minister for Trade and Customs (Mr. Pratten), and he denied that that was so. I have accepted the Minister's denial. I was interested in the Minister's statement that the measure of preference given in this amended schedule is similar to that granted last year.

Sitting suspended from 6.15 to 8 p.m.

Senator PAYNE - In some instances the so-called preference to Great Britain, which the Minister claims is extended by the present bill, is not preference at all. If one were to erect two fences, one 8 feet high and the other 10 feet high, knowing that neither the Britisher nor the foreigner could jump over either, could one claim that the British competitor was getting a preference over the foreigner by having an 8-ft. instead of a 10-ft. fence to jump? Of course not. The fence would prove an impossible barrier to both competitors. At this stage I cannot refer to items in detail, but there is one line of goods on which the importer of the British manufactured article who has been paying a duty of 2s. will now he called upon to pay 6s. At the latter rate it will be absolutely impossible for the article to be exported from England and sold in Australia. It is nothing short of absolute prohibition. On another line of goods, where the duty on the British article has been 2s. 9d., it will now be 8s., which will also prohibit the export of the goods to Australia. In the general column the increases on these two lines are from 3s. to 10s., and from 3s. 6d. to 12s. respectively, making their importation impossible. Yet the Minister claims that the principle of preference to British manufacturers is being extended. It is a misnomer to call it preference when it really amounts to prohibition.

Senator Crawford - It may not extend the preference on those particular goods, but the concessions given on other items will more than counterbalance the increases referred to by the honorable senator.

Senator PAYNE - I am taking the items as I find them in the schedule. There is a line of goods in which the British manufacturer has always done a big trade with Australia; but now we say, " This must cease. No longer will you be permitted to trade with Australia in that line of goods." That sort of policy does not tend to cement the bonds of Empire, and if it is continued we must inevitably bring disaster upon ourselves.

Senator Crawford - No.

Senator PAYNE - The feeling is growing stronger and stronger each year that, in connexion with tariff matters, we should weigh carefully . any suggestion for the prohibition of- the importation of goods from any part of the Empire, or even from other countries, except from a health-preservation point of view.

I notice in the schedule a continuation of what I consider the most pernicious system that can be introduced into a Customs Tariff Bill - the substitution of a flat rate of duty, where the ad valorem rate will not realize as much revenue as the rate. If it becomes necessary for me to move to remove an anomaly which I shall now point out, I hope my Labour friends will help me with their votes. If they fail to do so, they will not be studying the interests of the poorer section of the community. An article in general use and worn only by the working men of Australia is manufactured in Great Britain at an export cost of 6s. Landed in Australia it will now cost 14s. l0d. The expense incurred in importing the article, in conjunction with the duty imposed, will amount to 150 per cent. The article will have to be retailed at a very much higher price than that at which it has recently been sold. It is a men's hosiery item that is only worn by working men. No man of means ever wears it. When we come to another article of the same kind, but superior in quality, which only a man of means can purchase, it is invoiced at 20s. per dozen - we find that it will be admitted under the ad valorem rate, which will be slightly in excess of the flat rate. The cost incurred in importing this article and in paying the duty will be only 60 per cent., in addition to the British price. The rich man will thus be called upon to pay only 60 per cent, more than the British manufacturer's price, while the poor man will be obliged to pay 150 per cent, more for that which he requires.

Senator Crawford - The poor man will buy the Australian article.

Senator PAYNE - He cannot do so because so far the article has not been made in Australia.

SenatorFindley. - What is the article?

Senator PAYNE - It is a particular line of men's hosiery. The same thing applies to many other articles of men's apparel that we dealt with in the last tariff schedule, and I cannot understand why honorable senators opposite, instead of endeavoring to relieve of some of their burden those they claim to represent, should take every opportunity to make it heavier.

Senator Findley - The working men do not raise any complaint.

Senator PAYNE - If the honorable senator would ask the working man's wife he would soon find out whether or not there was any complaint, particularly if she knew that she had to pay 2s. for an article that she was able previously to get for ls. I object to the principle of applying a flat rate or an ad valorem duty, which ever yields the greater amount of revenue, because it does not apply fairly to all sections of the community. The Minister will realize this, when we come to the items in committee.

Senator Duncanmaintains, quite correctly, that no matter what it costs, we should, do all we can by the imposition of customs duties to build up and maintain key industries in Australia. I quite agree with the honorable senator that a country like Australia, separated as it is by thousands of miles of ocean from the vest of the world, and from the principal manufacturing centres of the world, must be as self-contained as possible with regard to key industries. There are certain secondary industries which are essential to Australia and must be maintained. But it is equally essential that we should pay very close attention to our primary industries, which are the ' basis of our prosperity. There is one of them which has been allowed to go to the wall during the last few years. At the risk of being described as a very moderate protectionist at one time, and a high protectionist at another, I am prepared to support a proposal which will come before the chamber to give adequate protection to that industry. It is one of the most valuable we have in Australia. I refer to the timber industry.

Senator Reid - Good old Tasmania!

Senator PAYNE - Why a Queensland senator should make any reflection on Tasmania because it happens to be in a position to supply the mainland with a good deal of what it badly needs, I can not understand.

Senator Reid - If the people of Tasmania were making hosiery the honorable senator would be supporting the duties on hosiery.

Senator PAYNE - Tasmania is now making some of the best hosiery produced in the Commonwealth. Senator Reid is evidently not aware of the flourishing industries we have in that portion of the Commonwealth. To Australia timber is just as essential as iron and steel. We can not do without it. Why should honorable senators ridicule a suggestion that we should g'ive adequate protection to the timber industry so that it may be revived, and in order that the magnificent forests of Australia may be utilized in the best interests of the people?

I am prepared to support adequate protection for every industry; I do not mind what it is so long as it gives employment and is useful to the community ; but there are some industries without which Australia would be better off. The people would be better off in their pockets if they relied on the British manufacturer to produce certain articles.

Senator Findley - Will the honorable senator mention any of them.

Senator PAYNE - This is not the time to give details.

The Leader of the Opposition made a statement to-day that I have heard him make on other occasions. As a matter of fact I have made it myself, but have since altered my views. I do not believe in a member of Parliament holding the same views during many years and deciding never to depart from them, despite what developments may occur in the meantime. We must all keep pace with the times. Conditions to-day are totally different from those which prevailed prior to 1914. What might have suited the years prior to the war would if operative to-day be entirely unsound, and might prove detrimental to the community.

Senator Needham - What did I say to which the honorable senator takes exception?

Senator PAYNE - The honorable senator said that we ought to look forward to the time when Australia would be self-contained, and need not be dependent on any other country in the world.

Senator Graham - Hear, hear !

Senator PAYNE - Do honorable senators realize what is happening in the world to-day. If that universal brotherhood about which they are always boasting is brought about, it will prevent any country from being absolutely selfcontained. No country can afford to say today that it will not trade with another.

Senator Reid - " Self-contained " does not mean that.

Senator PAYNE - Senator Needham meant it when he said that he hoped the day would come when Australia would never have to import anything. He said that he hoped that Australia would be self-contained because we could manufacture all we require. That policy will not hold good to-day.

Senator Needham - Is there anything wrong with it?

Senator PAYNE - Yes, it is too dangerous a policy for any public. man to support.

Senator Needham - I am prepared to risk it.

Senator PAYNE - I am sorry to hear such an admission. The future peace of the world will depend almost entirely upon every country giving fair consideration to the trade requirements of other countries. If we attempt to prohibit trade with other countries it will not tend to make Australia popular with other nations. I do not believe in free trade; I could not consider such a policy for a moment. Australia is a young country in which we are attempting to build up new industries, some of which if carried on in a reasonable way are useful; but if they are so conducted as to improverish the working people, we are better without them. I trust that when this measure is in committee the items will be discussed on their merits, and that if any honorable senator opposes the proposed duties on certain items he will be given credit for having the courage to act on his convictions. I trust that every honorable senator will study the effect of additional duties, not only upon a particular industry, but upon the whole community.

Senator THOMAS (NEW SOUTH WALES) - Upon the poor suffering consumer.

Senator PAYNE - Yes. We should have provided long ago so that when manufacturers or distributors are urging the necessity or otherwise of amending the tariff item, a representative of the consumers may also put their case before the Tariff Board. Nothing of the kind has yet been attempted, but I was glad to read in a report of the board some time ago a comment upon the necessity of some such provision being made. Up to the present the people have had to pay without even being consulted. I support the second reading of the bill, and trust that certain amendments to the schedule will be made.

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