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Friday, 24 April 1936

Senator PAYNE (Tasmania) .- In listening to the remarks of 'Senator Brown, I wondered whether he intended to support or oppose the measure now before the Senate. He endeavoured to discredit the present Government for the action it has taken in reducing customs duties, and to justify the unnecessarily high duties imposed by the Scullin Government, of which he was a supporter. I welcome the introduction of the bill, because it represents the first sane attempt to place the tariff on a businesslike basis. For some time Australia has suffered as the result of the action of the Scullin Government which in 1929 illegally and contrary, not only to the letter but also to the spirit of the law, imposed on many items rates of duty which were absolutely indefensible. The honorable senator and those associated with him endorsed the illegal action of that Government taken in defiance of the Tariff Board Act, which is one of the most important measures on the statute-book. Its action in that respect has had a serious effect upon certain small companies relying upon industries which were able to operate only under a prohibitive tariff. I have waited for some time for this anomaly to be removed, and I congratulate the Government upon the schedule which has now been introduced. It will probably be necessary to criticize the duties imposed upon certain commodities, but the measure is a serious attempt to restore sanity in fiscal matters. Many of the rates imposed in 1929 as British preferential duties were so high that it was impossible for any British manufacturer to export profitably to Australia. I am glad that an effort has now been made to remove this anomaly and that the Government realizes the fact that it owes a duty to the Australian people. Moreover, it should set an example to others by observing the laws of this country. I refer honorable senators opposite to section 15 of the Tariff Board Act, which reads: -

Flic Minister shall refer to the Board for inquiry and report . . . the necessity for new, increased or reduced duties, and the deferment of existing or proposed deferred duties.

The last paragraph in that sub-section provides that the Minister

Shall not take any action in respect of any of those matters until he has received the report of the board.

The point I emphasize is that none of these matters was referred to the Tariff Board, and no report on any of them was received from the board before the Scullin Government introduced the schedules imposing the burdens to which I refer. The whole procedure was illegal, and this Government would not have proved worthy of its position had it not taken steps to remove the reproach to Parliament that the Scullin Government had during its term of office deliberately broken the law of the land.

Senator Duncan-Hughes - Did the Scullin Government adopt that procedure by virtue of any act passed prior to the Tariff Board Act?

Senator PAYNE - I presume not, because any prior law must take second place to the ' Tariff Board Act. This is distinctly laid down in that act, and no law has been passed since its enactment to give the Minister power to act as he did during the regime of the Scullin Government. Senator Brown sought to convey the impression that the Tariff Board dictates the fiscal policy of the Commonwealth. The board does nothing of the kind; it simply carries out instructions contained in the Tariff Board Act. It is composed of a body of men, who are selected very carefully, and it is empowered to make inquiries, and, where it sees fit, to call evidence on certain matters. But it has no power at all to carry into effect its own recommendations. The board is simply charged with the responsibility of making recommendations to the Minister, and the Minister must bring such matters before the Parliament for endorsement or otherwise. Therefore the suggestion that the board dictates the fiscal policy of the Commonwealth is groundless.

Senator Brown - We must consider the operations of the Tariff Board in relation to the provisions of the Ottawa agreement.

Senator PAYNE - The Ottawa agreement has no bearing at all upon the Tariff Board.

Senator Collings - Read articles 10 and 12 of the agreement.

Senator PAYNE - Neither of those articles gives any instruction to the Tariff Board. They merely provide that duties shall not be increased above the level recommended by the Tariff Board. There is no instruction to the Tariff Board contained in the Ottawa agreement. The Ottawa Conference had no control over the Australian Tariff Board; therefore the articles of the agreement apply on to the governments. We have heard a good deal to-day concerning the desirability of refraining from exporting any of our primary products.

Senator Brown - Who said that?

Senator PAYNE - The honorable senator advocated that we should retain all our primary products.

Senator Brown - I said nothing of the kind.

Senator PAYNE - The honorable senator distinctly pointed out the foolishness, as he termed it, of Australia exporting its primary products, to be returned as manufactured articles. The honorable senator should have sufficient intelligence to realize that if we adopted his policy, we would need a population of at least 20,Q00,000 people to consume the goods produced.

Senator Brown - I did not say that that policy could be carried out right away; I suggested it as an objective.

Senator PAYNE - I am fully aware of the honorable senator's meaning when he objects to the importation of any goods that could be manufactured in Australia, but whichever way he explains himself it should be patent to him and to everybody that the prosperity of this country depends on our finding good markets for our exportable products, and, further, that when we find such markets, we must, of necessity, buy from those countries which buy from us. The adoption by the white race of the policy advocated by the honorable senator - and I am not now referring to Australia - has brought about some extraordinary condition of affairs in world trade. In the sixties of last century, the American Government decided to compel Japan to open its ports to the world, and backed by its powerful fleet it accomplished that aim. Because of that action, however, Japan for its own protection, was compelled to intensify its industrial production. It realized that if it were going to buy commodities from other countries, it must itself turn out commodities in order to be able to trade reciprocally. Thus to-day we find that Japan is a great manufacturing country and, of necessity, is seeking outside markets. I claim, therefore, that the white peoples of the world have themselves to blame for the present Japanese competition in trade. Honorable senators should bear that fact in mind. Originally the Japanese did not desire to trade with the rest of the world; they wanted to live unto themselves, but the white peoples of the world compelled them to open their ports with the result that they were forced to take up industry more intensively. They had not previously contemplated such action.

Frequently I have endeavoured to show that the tariff which has operated in Australia for the last few years has not been framed in the best interests of the Commonwealth. One section of the community - the consumers - was not taken into consideration until quite recently. I can visualize the possibility that a reduction of tariff duties may bring about such a lowering of the cost of living as will more than compensate for any prospective loss of employment. To-day many people in Australia live in comparative comfort, because of reduced costs of goods which, they must have to enjoy reasonable comfort. The cheapening of the cost of living must prove of general benefit to the community, and I am confident that with a. continual increase of efficiency on the part of our manufacturers, we can reasonably anticipate that commodities will be produced in Australia at a gradually diminishing cost. Thus there has been no necessity for the exceptionally high tariff that has prevailed for many years. This tariff has engendered in many countries antagonism to Australia. Many of the duties are absolutely unnecessary and considerably higher than the mere encouragement of industry in Australia would justify. That fact is realized in other countries. Consequently the action of this Government in reducing tariff duties diminishes that ill-feeling which has been engendered abroad by the imposition of the high duties of recent years. I am hopeful that as the result of the passing of this schedule we shall secure a larger measure of trade with other countries. This must of necessity tend to ensure the prosperity and wellbeing of our people as a whole.

Debate (on motion by Senator Leckie) adjourned.

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