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Thursday, 30 April 1936

Senator DUNCAN-HUGHES (South Australia) . - Like very many more items in this schedule this item has appended to it a paragraph reading "And for each £1 by which the equivalent in Australian currency of £100 sterling is less than £125 at the date of exportation - an additional duty of . . ". In this instance the additional duty is 2.4d. in each column. I ask why provision is made only to meet a fall of the exchange rate below £25. It is highly possible that if the rate were unpegged, or even if it were pegged, it might be at a higher rate than £25. In that event one would expect a corresponding reduction of duty. On one occasion Sir Granville Ryrie said that the Labour party had a sliding scale of wages, but it slid in only one direction ! Such an observation could bc appropriately applied to this exchange formula. Provision is made for a variation of duty, but only when the rate of exchange falls below £25. "Will the Minister explain the reason for this?

Senator A.J. MCLACHLAN (South

Australia - Postmaster-General) [9.45]. - The provisions to cover exchange adjustment have been worked out on the assumption that the rate of exchange will " remain static at £25. Honorable senators will see that if the exchange rate went to £30 the value of the tariff protection would be automatically increased. Provision is made that, in the event of the rate of exchange dropping below £25, thus reducing the protection, an additional duty shall automatically apply. This is a precaution which' the Tariff Board has taken in order to maintain the ratio of protection which the board considers to be necessary. Honorable senators will see a simple application of this provision when we arc discussing certain duties later on; in that instance the additional duty is .36d. for every £1 by which the exchange drops, which work.; out at exactly 9d. per cwt. at par. On every item to which the provision for additional duty applies the board has made special calculations. If the rate of exchange goes beyond £25, more protection is automatically given.

Senator Duncan-Hughes - In that event there should be a. reduction of the duty; otherwise the protected industry receives an additional advantage.

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