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Wednesday, 7 March 1928

Senator CARROLL (WesternAustralia) . - This being the first opportunity I have had of dealing with tariff matters since I entered' the Senate on 1st July, 1926, I should like to make my position clear, particularly as the Leader of the Opposition (Senator Needham) this afternoon inferred that I entered the Senate as a freetrader.

Senator Needham - I said that the honorable. sen ator was a low tariff ist.

Senator CARROLL - I am not a freetrader, and have never professed to believe in f reetrade doctrines, I belong to an organization which 'believes in moderate protection, and not in placing heavy burdens on the means of producing the country's wealth. So long as I am able I shall do what I can to relieve from the heavy burden of taxation the means of producing wealth. Applications by manufacturers for increases of duty are equivalent to requests for assistance from the public purse to carry on their private businesses against the competition of manufacturers in other parts of the world.

In tariff matters there appears to be one law for the rich and another for the poor. Australia is justly proud of its legislation providing for old-age pensions. But before an old-age pension . is granted the applicant must disclose details of his financial position, and if the department is satisfied he may receive a pension not exceeding £1 a week. On the other hand Australian manufacturers who apply for increased protection have nevet yet, so far as I am aware, been required to produce evidence to show that further duties are necessary toenable them to carry on their businesses.

Senator Crawford - No claimant for an old-age pension is required to disclose his private affairsto the public.

Senator CARROLL - That is true ; but he has to disclose full particulars to departmental officers.

Senator Crawford - Australian manufacturers are required to disclose to the Tariff Board particulars in support of their applications.

Senator CARROLL - The Tariff Board may investigate claims for increased duties, but it rests with Parliament to say whether those duties should be increased. I remind the Minister that a few months -ago the Senate had before it a proposal to dispose of the Australian Commonwealth Line of' Steamers. Although it was made clear that the disposal of the Line would result in a saving of at.least £500,000 per annum, many honorable senators contended that they should not be asked to decide the question of the disposal of the Line without having before them the evidence tendered before the Public Accounts Committee. We are now asked, not to relieve the people of the burden of taxation, but to impose further taxation on them, without having before us data to enable us to come to an intelligent decision.

I am not a rabid freetrader; I endeavour to examine tariff proposals from a common-sense point of view. So far as I am aware, the Tariff Board has never asked an Australian manufacturer who has applied for increased duties to produce his bank book. He may make certain statements before the Board, but is not called upon to produce the very evidence which would enable the Tariff Board to decide whether the claim was, or was not, justified.

Senator Crawford - The affairs of applicants are frequently investigated by skilled accountants on behalf of the Tariff Board.

Senator CARROLL - On several occasions I have appeared before the Tariff Board to oppose applications for increased duties on articles required by primary producers. My evidence has always been taken in public, and at times I have been subjected to severe cross-examination by the Chairman of the Tariff Board. But when those whose claim I was opposing appeared before the Tariff Board, their evidence was taken in camera, and I had no opportunity of cross-examining them. In speaking in this way I realize the utter futility of what I am saying, because even if the Senate were to throw out this bill and wipe out this schedule of duties, the Minister for Trade and Customs, under that little measure, the Australian Industries Preservation Act, could quite cheerfully restore the duties as they appear in the schedule to-morrow, and things would be just the same as they are to-day. As a Parliament we have placed an autocratic power in the hands of one man to override the will of Parliament.

Senator Ogden - We have a remedy for that.

Senator CARROLL - Yes, but the Parliament has not the courage to apply it.

Senator Crawford - The Minister must act in accordance with the law.

Senator CARROLL - Of course, but the law may not always be in accordance with the Constitution. In my opinion the Australian Industries Preservation Act is not.

Senator Crawford - That point has not been tested.

Senator CARROLL - It has not, but if any one had the courage to test the act, I think it would be found to be unconstitutional. Section 90 of the Constitution Act says that the Commonwealth Parliament shall have the exclusive power to impose duties of customs and excise; it does not say that this power may be delegated. At any rate that is my reading of the Constitution, but I am not a lawyer.

Senator McLachlan - The honorable senator ought to be one.

Senator CARROLL - When recentlyI was consoling a nephew of mine, a law student who had failed to pass an examination, I said that the law had always had a fascination for me, and that I had made up my mind that if I ever had any money to spare before I was too old, I would take a spell and study the law. He said, " Yes, I think you would do well at it. If you knew all the damn fools who are doing well at the law, I am sure you would have no misgivings about the matter." I suppose the Honorary Minister has the same sort of mind about me.

Just before I took my seat in the Senate the Customs Tariff Bill was under review, and a clever little movement was made to alter the system of levying duties on sheet glass from so much per square yard to so much per lb. What appeared on the face of it to be a slight alteration reducingthe rate of duty, actually increased it by 500 per cent. The rate, which was previously 2s. 6d. and 3s. 6d. per square yard, wasaltered to11/2d. and 2d. per lb. About the same time the Australian Glass Company held its annual meeting, and Mr. Grimwade, the chairman, of directors, showed that it had made a profit of £169,000 for the year. After paying a dividend of 10 per cent, the company carried forward £50,000 to profit and loss and wrote off a considerable amount of depreciation.

Senator Thompson - That is not much profit for a trading concern.

Senator CARROLL - No ; but the chairman of directors of the company said that if they could not get increased protection on some of the lines which they were producing , it would be necessary for the company to close down some of the works and dismiss some employees. He said that for the first time in his life he had been guilty oflobbying, inasmuch as he had taken some of the sheet glass manufactured by the company and exhibited it to members of Parliament in the Queen's Hall at Parliament House, Melbourne. To my mind that statement proves that I am correct when 1 declare that many manufacturers' secure increased protection when, in reality, they are not financially in need of it.

I am not one of those who, during the war,went about advocating that every one should go to the front and swearing by all that was holy that never again would Australia trade with Germany or any other enemy country. There was some mention of German goods this evening. They can be secured to any extent in the capital cities of Australia. Retailers sell German goods because they can buy them cheaper than British goods, and the preference that Australia gives to. the British manufacture is to a large extent nullified. As Senator Duncan said, the fault lies with the buying public. Everyone knows that at least 90 per cent, ofthe buying public are the workingpeople of Australia. They constitute 90 per cent, of the total population, and can control any buying that is done. No one imports goods merely to see how pretty they look on a shelf. When goods are imported, buyers have to be found for them. Many years ago when

I worked on the mines in Kalgoorlie, it was a favourite recreation for all the " free and independent " to get on a lorry at the corner of Hannan-street and Maritanastreet on Saturday nights and to indulge in heroics until the cows came home, about trading only 'with white men. At the same time their wives were engaged in buying from the 'dagoes, as they were called, who were selling at Id. per lb. cheaper than the British traders. That that is not invention on my part is known to any one who lived on the gold fields in those days. The same spirit is abroad in Australia to-day. We talk largely about preference to Great Britain and all sorts of patriotic stuff' but when we have the silver to spend we leave it with the foreigner. '

We have been told to-night that we ought to look at this tariff from a broad Australian viewpoint. I believe that the correct expression is "broad national viewpoint." That is a fine fruity phrase which reads well. It is like that other phrase " adverse trade balance," which, when repeated often enough, looks so imposing in the press, but really means nothing. After all what we really need to do is to look after the interests of our own States, which, of course, dovetail into those of other States. It is not always an advantage to see what another State does or should do. Sometimes it reminds us too readily of some of the difficulties of our own' States, and that is not always conducive to the promotion of a brotherly spirit. I think it will be admitted by all that, from a developmental standpoint, Western Australia is the most backward State. It has certainly, as the Minister has said, come rapidly to the front as a wheat producer, but it had to do so or admit that it was downandout.

Senator Thompson - Western Australia has had a succession of good seasons.

Senator CARROLL - Certainly, and for this the Almighty has had a little of the credit, but the recent progress of the States is largely due, we are told, to the fact that it has had a good Labour Government in office. At least that is the impression I have gathered from the literature issued every now and then by that Government.

In order to carry out its developmental work Western Australia is now embarking upon extensive agricultural water schemes. It has not the rivers that the eastern States have, and it is thus necessary for it to conserve water in the agricultural districts in a way that has not to be done in some of the other States. The State Government is therefore a buyer for hundreds of miles of water piping to run water from the different reservoirs to the farms served by them. The schedule before us to-night will hit it very severely. One item alone will add about £20,000 to the cost of the water piping. Furthermore, in order to develop and encourage the agricultural industry, the State- Government has in hand a big railway building scheme to the cost of which this Tariff Bill will make such a tremendous difference, that it will be obliged to reduce the mileage that could have been built before the schedule was imposed. That may not appear to be a very big item, but it is a big item to a State like Western Australia, where the farmers who are out on new agricultural areas have been hoping against hope for several years past that they would get a railway to transport their produce -to market at a reasonable rate.

I notice that several speakers in another place have accused the Government of setting out to annihilate the iron and steel industry of Australia. I cannot help recalling the statement made by Mr. Delprat, Managing Director of the Broken Hill Proprietary Limited, -at a banquet which was given when the company first commenced to manufacture steel rails at Newcastle. He said that the company was getting the comparatively small bonus? of 12s. on steel rails and did not want a duty because it was able to carry on without one. We now find that the company is not satisfied with the duties already imposed and it is said that the whole iron and steel industry is on the point of annihilation, because it cannot get a duty of more than £3 a ton on steel rails.

Senator Thompson - There have been a few award variations since Mr. Delprat made that statement.

Senator CARROLL - I admit it. Award variations are another necessary evil in our modern system.

With all the protection that is being accorded to various industries in Australia I notice that there is no talk of giving assistance to the gold-mining industry. Although that industry has slumped very considerably in Western Australia, it is still producing about £1,500,000 worth of gold a year without new finds of any consequence, and is providing employment for many people. To my mind it is certainly due for some assistance from an admittedly protectionist Government. There are several items in the schedule upon which I shall have something to say when the" measure is in committee. It has been said that when higher duties are imposed the price of locally manufactured articles is increased. There is no reason why that should be so; but nevertheless it is a fact that on every occasion upon which additional duties have been imposed consumers have had to pay higher prices for the Australian article.

Senator KINGSMILL (WESTERN AUSTRALIA) - The honorable senator should cast his eye on the Arbitration Court to ascertain the cause.

Senator CARROLL - The decisions of that court are to some extent responsible.

Senator Needham - That was the case before we had a Commonwealth Arbitration Court.

Senator CARROLL - I believe it has always been the practice to bring the price of the Australian article very near to that of the imported commodity. I am not saying that the importers are all white-headed boys, and the Australian manufacturers a lot of brigands. The one is as good as the other. If we had no tariff we should be bled by the importers, and, on the other hand, when the tariff duties are increased we are bled by the local manufacturers. We get it both ways.

Senator Thompson - Competition keeps importers within their limits.

Senator CARROLL - Yes; but we do not have competition in the real sense of the word. Some manufacturers sell their products to retailers on the definite understanding that they are to be disposed of at a fixed retail price. This suggests that there is an " honorable understanding," under which retailers all receive the same profit. If a retailer sells below that price his supplies are cut off. I remember a case heard in Richmond, in Victoria, where Lever Brothers sued a retailer for selling Palmolive soap at less than the stipulated price. Whilst supporting the second reading of the bill I reserve the right to do what I can in committee to reduce to a reasonable level duties that I think are too high, so that those industries upon which Australia really depends, will have opportunities equal to those enjoyed by other highly protected industries. Senator Findley said that there were certain industries which Australia could successfully conduct, and upon which , we should concentrate. There are only one or two industries which can compete with those in other countries. We have been told that Australian manufacturers must be assisted to compete with those in countries where cheap labour is available, and where the standard of living is below that which- we enjoy in Australia. It would be equally logical to say that, because our wheat-growers are compelled to sell their produce in competition with that grown by cheap labour - in India, for instance - they should receive protection. Does any one suggest that the wheat and wool growers should receive a bounty on what they produce? These producers are content to do their own job; but they do object to have to carry other industries on their backs while doing it. That is the objection I have to what is termed a " scientific " tariff.

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