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Wednesday, 24 August 1921

The TEMPORARY CHAIRMAN (Senator Plain (VICTORIA) - There is a quorum present.

Senator PEARCE - I regret that there is not a full attendance of honorable senators, because some of them will be entering the chamber presently and asking the reason for these duties. On 12th May, 1919, Senator E. D. Millen addressed the following letter to the Minister for Trade and Customs: -

My dear Greene,

I am enclosing an offer . (see page 2) submitted some time agoby Mr. H. V. McKay, of the Sunshine Harvester Company, relative to the manufacture of reapers, binders, and mowers. Youwill notice that it is primarily a repatriation proposal. From that point of view, it commends itself to me; butI should be glad if you will consider how far it commends itself to you as a bonus proposal. After you have considered the matter, I shall be glad to chat it over with you.

E.   D. Millen.

The proposal made was, in effect, that if the various firms manufacturing like implements in Australia, which up to that time had not undertaken the manufacture of the particular machines and implements covered by this item, were given a bonus and a duty, they would be prepared at once to commence their production in the Commonwealth, and would undertake to employ a number of returned soldiers in the industry.

Senator GUTHRIE (VICTORIA) - They wanted a bonus and a duty ? They were not philanthropists.

Senator PEARCE - I invite the honorable senator not to come to a premature decision. After he has heard my explanation I think he will be satisfied. I have not said that the proposition was accepted. As a matter of fact, it was not. As honorable senators are aware, we have a Board of Trade, and the Minister for Trade and Customs very properly referred the proposal to it for investigation. The Board called before it manufacturers of like implements and machines, and thoroughly investigated the possibility of their being able to successfully manufacture those dealt with in the item. They inquired into the prices that were being paid for the imported machines as well as into the cost of production here and the price at which they could be sold by the local manufacturers. As the result of a thorough investigation, the Board on 2nd June, 1919, unanimously agreed to recommend to the Minister of Trade and Customs -

That action be taken in accordance with paragraphs 1 - 3 of the within proposals, dated 7th May, 1910..... (b) to inform the Minister for Repatriation that, in the opinion of the Board of Trade, Customs duties are preferable to a bounty as a means of affording assistance to establish the local manufacture of these goods, and that the employment of returned soldiers in the industry should be a matter for arrangement between the Repatriation Department and the manufacturers, and be subject to the usual conditions relating to inefficient workmen.

The manufacturers in giving evidence before the Board had offered to take into their employment in this industry a certain number of crippled or maimed soldiers who, of course, would not be efficient, and the Board suggested that that part of the scheme should be the subject of arrangement between the Department and the employers. Leading manufacturers in Victoria and other States were among those who appeared before the Board, and all were favorable 'to the project, and prepared to give the necessary undertakings. The recommendation made by the Board of Trade was adopted by the Minister for Trade and Customs, who informed Senator E. D. Millen of his decision. The proposals now embodied in the item before us are not those originally made by the manufacturers who first came forward, but are the result of consideration by the Minister. I would impress upon the Committee the fact that these manufacturers came forward, not of their own volition, but at the invitation of the Minister, who, through the press, had invited employers to suggest means by which new avenues of employment could be . opened up. o It was -in response to that invitation that their proposal was made. It received the scrutiny of the Board of Trade, and, the views of the other manufacturers having been taken with respect to it, we have, as a result of the investigation, the duties that ap'pear in this item. The industry, which has been established as the result of the* duties, is now in operation, and is turning out these machines. Before the duty relating to binders came into operation, the importing firms had raised their prices in Australia to £98, while in great Britain, where they were free, the price was £92 10s., and in New Zealand, where they were also duty free, £97. The Australian manufacturer is now supplying at £95 each binder made in Australia, from Australian material, largely by returned soldiers.

Senator GUTHRIE (VICTORIA) - Does the Minister say that a reaper and binder can be purchased in Australia for £95 ?

Senator PEARCE - I make that statement on the authority of the Minister for Trade and Customs. I take it that he had investigated the question of prices before he made it.

Senator GUTHRIE (VICTORIA) - With all due respect, I differ from him.

Senator PEARCE - The statement was made by him in another place, and I am assured by the Customs officials that it is correct. I have here some of the information collected by the Board of Trade, and am in a position, therefore, to quote the prices of all the machines covered by the item. I desire, first of all, to stress the point that the duties under this item stand in a position somewhat different from that of other duties in the schedule. They are here practically as the result of an agreement. The industry has been started on the understanding that these duties shall be imposed, and honorable senators, whatever they may feel in regard to them, will, I think, consider that unless very strong evidence can be brought to show that the Australian farmer is suffering by reason of an increase in the prices, the duties should stand as they are. I have detailed prices here, and am given to understand that since these duties have been imposed binders are being sold by the local manufacturers for less than the price previously charged for the imported machines.

Senator Earle - The honorable senator is correct. Reapers and binders can be purchased f.o.b. Melbourne for £95.

Senator PEARCE - The information given by the Minister in another place has not yet been successfully challenged.

Senator GUTHRIE (VICTORIA) - These machines are very much cheaper in New Zealand.

Senator PEARCE - The information obtained by the Customs Department is to the effect that the farmers in N e* Zealand and Great Britain, where binders are free, have to pay £97 and £92 10s. respectively for them.

Senator GUTHRIE (VICTORIA) - That is not correct.

Senator PEARCE - That is the statement made by the Minister for Trade and Customs (Mr. Greene) on the 15th June last.

Senator GUTHRIE (VICTORIA) - Does it refer to the 8-ft. or the 6-ft. machine? The price of the 6-ft. machine in New Zealand is £83, and of the 8-ft., £97.

Senator PEARCE - With respect to importations, into Australia, I have the information that for 6-ft. binders manufactured by the International Harvester Company, port of shipment New York, date of invoice 1913, the price of each was, f.o.b., £17 15s. 8d., and c.i.f., £20 lis. 3d. The total importations at Melbourne were 817. In 1917, the f.o.b. price was £27 19s. 10d.; the ci.f. price, £44 Ils-. 7d. ; and in that year the importations at Melbourne numbered 692. Mowers, 4-ft. 6-in., in 1913, price, f.o.b.. £6 5s.; c.i.f., £7 6s. lOd. In 1917, price, f.o.b., £9 13s..; c.i.f. price, £16 4s. Id. There is further information supplied which gives the Massey-Harris price in 1918 for a 6-ft. binder, f.o.b:, at £40 17s. 4d., and c.i.f., £60 7s. ; and there were 480 to arrive. It should be remembered that these are prices for declaration to the Custom? Department. The 1918 prices for mowers from the same firm were f.o.b, , £13f6s. Id., and c.i.f., £19 15s. The total importations at Melbourne were 734. It seems significant that every one of these firms, apparently knowing that the in- vestigations to which I have referred were being made, doubled their importations, so that, during the first year of operations, the local market is already fully supplied with imported machines.

Senator GUTHRIE (VICTORIA) - I suppose the local people reduced their prices, teo.

Senator PEARCE - Further information supplied shows that, in 1913, the price of the Walter Wood 6-ft. binder was f.o.b. £19 19s. 9d., and c.i.f. £23 12s. 9d.; in 1917, the price was f.o.b. £2S 4s,, and c.i.f. £41 8s. For mowers. 4-ft. 6-in., the 1917 price was £8 14s. '4d. f.o.b., and £12 15s. lOd. c.i.f. ' I should say that the Committee has the further guarantee iu regard to the arrangement to which I have referred that it is not confined to any one firm. There are several firms at present turning out these machines successfully.

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