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Tuesday, 18 October 1904


Mr AUSTIN CHAPMAN (EdenMonaro) - In dealing with the second reading of this Bill, perhaps it would be advisable for me to make a short explanation as regards the position of the measure, and as to why it falls to my lot to continue the debate at this stage, and nominally to take charge of the Bill. Before doing so, I wish to remind honorable members that the Bill is really part and parcel of the Tariff, which was passed by the first Federal Parliament. The part to which I allude is known as Division 6a. The right honorable member for Adelaide moved the second reading of this Bill - or what was practically this Bill, because the measure introduced by the honorable member for Hume is based upon the measure placed before the House by the right honorable member for Adelaide, who moved the second reading on the 27th May, 1902. The debate that took place is a matter of history. The measure was discussed at considerable length. Many honorable members expressed themselves in favour of granting bonuses for the production of iron, tout a large number held that it would be a good thing to endeavour to nationalize the industry, instead of holding out encouragement in the way of bonuses to private enterprise. After some long and interesting speeches, in the course of which a great deal of information was given to the House, the subject was referred to a Royal Commission. That Commission was composed of honorable members of this House, selected from each side, and a glance at the fiscal faith, or professed' fiscal faith, of those gentlemen, shows that half may be classed as freetraders and the other half as protectionists. This selection insured that from the fiscal standpoint, the whole) matter would be thoroughly investigated, and that a good deal of information of value to honorable members, and to all who take an interest in the matter, would be furnished. The Commission held meetings in three or four of the States, and heard evidence from1 all the experts available. When the time arrived for the presentation of the report, it was found that the members of the Commission were divided in opinion, and that there were two reports, one of which might be called the report of the Commission, since it represented a majority, created by the vote of the Chairman, while the other was what is termed a minority report. The first report was in favour of a bonus to encourage this great industry, and in favour of its being undertaken by the State rather than by private enterprise. Just at that time there was a change of Government, and an appeal to the electors, and the policy on which the then Prime Minister, the honorable and learned member for. Ballarat, went to the country was fiscal peace and preferential trade. It was understood that the question of a bonus for the iron industry, and also that of preferential trade were excepted from " fiscal peace " ; and, consequently, the latter issue was placed before the electors as plainly as was possible on the occasion of a general appeal of the kind. We all recognise that this proposal for a bonus for the iron industry was really part and parcel of the Tariff. A good deal of Injustice was caused by the postponement of the consideration of Division 6a. Those, engaged in the industry suffered much loss ; indeed, some of the works have been prac tically closed, owing to the unfortunate delay brought about in the way I have indicated.


Mr Fisher - The honorable member will show that there has been this loss?


Mr AUSTIN CHAPMAN - I shall show that. When the new Parliament met, the Minister of Trade and Customs, who was then the honorable member for Hume, introduced a Bill which was almost identical with the proposals laid before honorable members in 1902 by the right honorable member for Adelaide. That Bill reached its secondreading stage in the hands of the honorable member for Hume, and is the Bill before us to-day. Before it could be advanced further than the commencement of the debate on the second reading - and when the honorable member for North Sydney had moved the adjournment of the debate - the Deakin Government resigned. Some honorable members at that time attached much importance to a power on the part of the Government to resume any iron works which might be subsidized, but beyond that, there was no great difference between that measure and the measure introduced by the right honorable member for Adelaide. When the Watson Govern- 1 ment entered office, I gave notice of a motion in favour of the encouragement of the iron industry. I recognised that that was a mixed Government - that in fiscal faith its members were equally divided, there being four protectionists and four free-' traders. Under the circumstances, we could not expect that the Bill would be considered in the same way fiscally as it would have been by a Government, all the members of which were protectionists. I gave notice of motion because I recognised that this should be one of the premier industries of the country, and would, if established, give a great deal of employment and impetus to trade. Just about that time the honorable member for Hume asked some questions in the House as to whether the Watson Government would set apart time to enable him to proceed with the Bill, and it was promised that the matter would be considered in Cabinet, and a reply given in a few days. A deputation of ironworkers waited on me and asked me to introduce them to the Prime Minister, in order that they might show the great injustice under which they were suffering owing to the delay in proceeding with the measure. They pointed out. that in the wire-netting branch of the industry works in Victoria had already been closed, and large establishments in New South Wales, in which an immense sum of money is invested, and which afford a good deal of employment, were about to dose unless they received some consideration at the hands of Parliament. When the deputation waited upon him, the Prime Minister informed me that the matter would be brought before the Cabinet on the following Tuesday - it was a Saturday on which I introduced the deputation - and it was very likely that time would be given to a private member to proceed with the Bill, he at the time mentioning the name of the honorable member for Hume. I told that honorable member that I was very anxious to give every assistance; and it was my intention then to withdraw my notice of motion. We know that on the following week the Watson. Government promised to give the honorable member for Hume time in which to proceed with the measure; but before any further steps could be taken, that Government resigned. When the present Government came into office, it was understood that the question of a bonus to the iron industry was to be an open one, in the same way as it had been an open one with the' preceding Government, with the difference that the present Government stated their intention to afford a private member time to introduce a measure, with a view to obtaining an expression of opinion from the House.


Mr Fisher - The measure had already been introduced.


Mr AUSTIN CHAPMAN - Well, then, to go on with the measure.


Mr Fisher - To take it out of another honorable member's hands.


Mr AUSTIN CHAPMAN - Honorable members are quite able to defend themselves without requiring any champions, and the honorable member opposite need not' show so much pique, seeing that I am not saying anything against the Government of which he was a member.


Mr Fisher - I do not feel any pique.


Mr AUSTIN CHAPMAN - I understood the honorable, member for Hume to state, in the House, that he would not accept anything from the present Government. How I got that impression I do not know; but the honorable member has denied making that statement, and I must accept his denial. On the other hand, the Prime Minister assures me that the hon orable member for Hume did make such a' statement, and I am obliged to accept that assurance also. I asked the right honorable gentleman in the House what he was going to do, and he said that it was an open question. The honorable member for Hume was not on very good terms with me, though for what reason I did not know, unless it was that as I had voted differently from himself, and he had chosen not to be 01; speaking terms with, me for a time. Consequently, I could not approach him and ask him what he proposed to do. I took the next best step. Recognising that the position was serious, I asked the secretary of the Protectionist Union in Sydney; of which the honorable member for Hume has been president for many years, what, in the opinion of himself and of Sydney protectionists - who are much interested in this proposal - was best to be done in the circumstances. The secretary informed me that the honorable member for Hume had intimated to him that if I could obtain time from the ' Government to go on with the measure, he would give me every possible assistance. That naturally led rae to believe that the report I had heard - that the honorable member for Hume would not accept anything from this Government - was correct. Otherwise, why should he offer to help me? Why did he not say at once, "Oh, no; this Bill is mine." If he had done that the position would have been very different. I then asked the secretary of the Protectionist Union if he had any information which might be of service to me in dealing with the question. He told me that he had sent a number of the papers to the honorable member for Hume, whom he would ask to hand them over to me. I said, " Sir- William is not speaking to me now, and perhaps it would be better if you obtained the papers- from him yourself." He forwarded the papers to me, and I concluded that he obtained them on the understanding that the honorable member for Hume' would give me a' helping hand. When I asked the Prime Minister in the House if he would give me time to go on with the Bill, neither the honorable member for Hume nor any one else took exception to my request. Paragraphs on the subject appeared in the Sunday Times and daily newspapers of Sydney, and in the Age and Argus here, but no one raised any objection. After the papers were sent to me, a motion of censure was interposed. During the progress of the debate on that motion, the newspapers referred again to' the fact that, if it were not carried it was the intention, of the Prime Minister to give me time to go on with this measure, arid no one offered any objection until the vote was taken last Thursday evening. Then what happened? Perhaps it would have been better tactics if the Prime Minister had deferred making any explanation until the following day, because honorable members generally were warm, and after a close division of that kind those who are defeated are rather apt to make statements which they would not make in their cooler moments. But the Prime Minister - assuming, I suppose, that there would be no difficulty - simply announced to honorable members what would be the order of business. What remarks were made then? First of all we had the leader of the Opposition on his feet, championing the cause of the honorable member for Hume. All of us who know the latter believe that he is well able to champion his own rights. Why was it necessary, therefore, for the exPrime Minister, the ex-Minister of Trade and Customs, the ex-Minister of Home Affairs, the honorable member for Kennedy, and the honorable and learned memmer for Indi, to rise in their places one after the other and, in championing the honorable member for Hume, pitch into me ?


Mr McCay - They wanted to let off steam.


Mr AUSTIN CHAPMAN - In letting off steam, as I think they will admit now, they did me an injustice. Exception was taken on that occasion, by the honorable member for Moira to the fact that the measure should not be placed in the hands of a private member, since an expenditure of ^324,000 was involved, and a similar objection was made by the honorable member for Parramatta. Does it not seem strange that they should take up this attitude when they did not object to the proposal of the last Government to hand over the Bill to the honorable' member for Hume? Although the honorable member for Wide Bay cheered the remark that it should not be handed over to a private member, yet he, as a member of the late Government, was quite prepared to hand it over to the honorable member for Hume. What was right then is evidently wrong now. That requires some explanation which perhaps he will be able to give in due course.


Mr Fisher - Hear, hear.. Certain things had happened since then.


Mr AUSTIN CHAPMAN - I know that circumstances do alter cases, but nevertheless it is difficult to understand when some persons are in earnest. I took rather strong exception to certain remarks of the honorable member for Bland - first, because he was doing an injustice to me, and secondly, because he was making a threat against the measure. Of course, I accepted his assurance that he was making no such threat, and that he was only standing up for the rights of the honorable member for Hume. But I would call particular attention to this fact: that it was not necessary for four or five of the leading lights on the Opposition side to take exception to the action of the Prime Minister, when the honorable- member for Hume was here to speak for himself. On the following morning I went to the Prime Minister and told him that as there appeared to be some misunderstanding over this business, as the honorable member for Hume appeared to be taking up the role of an injured politician, and as. the leading lights in the Opposition appeared to me as if they would not view the Bill from a too friendly stand-point, I wished him to allow one of his colleagues to take charge of it, so as not to prejudice its passage through the House.


Mr Crouch - Would he' not give his consent ?


Mr AUSTIN CHAPMAN - I made the request so that the complaint could not be made that an honorable member was being badly used. I have no desire to pose as having charge of the Bill. I have no wish to try to. get out of it any kudos. Any right I am entitled to in this House I will, if necessary, obtain at the point of the political bayonet, or else I shall know the reason why. I do not wish to take an unfair advantage of any honorable member, nor have I ever attempted to do so here.


Mr Crouch - What reply did the Prime Minister give?


Mr AUSTIN CHAPMAN - Recognising that the passing of the Bill might be jeopardized - because we have had most alarming statements about the intended action of some honorable' members - I thought it was only right to ask the Prime Minister to allow one of his colleagues to take charge of it, or else to hand it over to the honorable member for Hume. I told him that I was quite prepared to help the latter, and to vote for the measure, as I did not wish to get any special credit or kudos out of its passage. All I wished to do was to elicit from the House a definite statement as to whether it was prepared to give a bonus, and for that reason 1 suggested to the Prime Minister that the Minister of Defence should be allowed to take charge of the Bill, because he, as a member of the Royal Commission, had displayed an anxiety to encourage the establishment of this great industry, and would be acceptable to the House as a compromise. But I had not the least objection to the honorable member for Hume taking charge of the Bill. Indeed, I should be very glad if he would take charge of it now. That, I "think, ought to show my bona fides in this matter.


Mr Crouch - What did the Prime Minister say?


Mr AUSTIN CHAPMAN - The Prime Minister declined to accede to my request for certain reasons, which, I suppose, he will give here. In the first place, he said " the honorable member for Hume will take nothing from this Government," and, in the second place, he said, " when a private member requires time to go on with a measure he generally goes to the Prime Minister and asks for it. It is not for the Prime Minister to go to him and ask him whether he will go on with the Bill or not. The honorable member for Hume has not asked me for any time."


Mr Thomas - The Prime Minister says that he communicated with the honorable and learned member for Ballarat.


Mr AUSTIN CHAPMAN - The honorable member will have an opportunity presently to speak. As regards a Minister taking charge of the Bill, the Prime Minister gave reasons why he did not think it was a. proper thing to do, and, further, he said that he would follow the course which he laid down on the preceding evening.


Mr Crouch - What were his objections to the Minister of Defence taking charge of the Bill ?


Mr AUSTIN CHAPMAN - I suppose that the Prime Minister will state those reasons to the House. I expect him to speak in this debate, and I hope from some remarks he made to be able to show that he was once in favour of granting a bonus, and that under existing circumstances he ought still to be of that opinion. He will probably be able to explain his reasons for not acceding to my request. At any rate, I am giving the facts, so far as they concern me, so as to make my position clear. What is there in my having charge of this Bill ? No one can have charge of it except nominally. It is the property of the House. The honorable member for Hume has no more right to be given charge of the measure than the right honorable member for Adelaide, the right honorable member for Swan, or the honorable and learned member for Corio, who, I expect, will stand by it strongly. No honorable member has a right to say that he will refuse or accept any particular amendment in connexion with it. That is a matter for the majority of honorable members to determine. I repeat that any honorable member can only be nominally in charge of the Bill, and it would appear to me to be only an attempt to find an excuse for opposing the measure, to give as a reason for opposition to it, the statement that one honorable member, and not another takes charge of it. I wish merely to put my own position clear. I have no desire to jump any one's claim ; but I assert the same- right as any one else to push this matter forward, and of course I shall welcome support from any quarter. I do not propose to speak at length on the principle of the Bill, because the pros and cons of the matter have been threshed out so often before. We have had them so well submitted in the report of the Commission, that it is hardly necessary that there should be any long speeches made, and we must recognise that, at this stage of the session, we should as far as possible economize time. I expect that those who believe in the measure will not labour the subject by making long speeches, which may result in its being blocked for want of time. I ' recognise that the real tug of war will come when we get into Committee. We are all agreed that the matter dealt with is one of national importance, and that the iron industry is the foundation and backbone of all the manufacturing industries of Australia. If we do not all recognise that, certainly the great majority of honorable members do, and I believe they are in favour of promoting the establishment of the industry, and making it what it ought to be in this country. No doubt the bone of contention is whether it should be under State control or in the hands of private enterprise. As to the great principle involved, it can hardly be claimed, even by ardent free-traders in this House, that it is against their policy to vote for a bonus, because we have repeatedly had statements from " first-rank free-traders in this country that if any encouragement is necessary for an industry it is better, in their opinion, that wherever possible it should take the form of a bonus. They give as their reason, that in that form we know exactly what has to be paid. It is a straight-out payment, and there is an end to it. Consequently, they cannot object to this measure on the ground that it is against their free-trade principles. Besides that, at the stage at which we have arrived in this Parliament, a number of honorable members will be able to view the matter from the stand-point, not of freetrade, but of compromise. If they agree with me that this is really a part of the Tariff, which has been postponed, they will, I have no doubt, be able to view it in a very much more favorable light than they would if we were fighting each other on the fiscal question, when each honorable member would be standing out to the last for what he believed to be the best policy to pursue. I say that the establishment of the iron industry may be favorably viewed from the stand-point of compromise by honorable members who might take strong exception to it if it were viewed from the stand-point of free-trade alone. Let me tell honorable members what the present Prime Minister thought of this matter.


Mr Thomas - When ?


Mr AUSTIN CHAPMAN - If the honorable member for Barrier will, allow his memory to carry him back, he will recollect that the present Prime Minister was the political friend of the late Mr. Mitchell, who endeavoured to establish this industry in New South Wales. The right honorable gentleman promised consideration of the matter on several occasions, and we believe that but for the early death of Mr. Mitchell the industry would probably have been established in that State by this time. But let us come right down to 1901 to learn what were the views of the present Prime Minister at that time. On tb.e 15th October, 1 901, during the debate on a motion of censure, referring to the . right honorable member for Adelaide, the present Prime Minister said -

The Minister for Trade and Customs was simply immense upon a policy which he hopes to introduce at some future date in reference to the iron industry. I have always been one who would like to see the iron industry firmly established, but my method of effecting this would be by giving it direct encouragement from the national Exchequer. My reason for so doing would be, that as it is a national, industry the nation should pay the expense of encouraging it. "The man who uses the iron ought not to be compelled to do that. A national benefit should be paid for out of the national funds. Why should not the whole community pay this bonus to the iron industry if the establishment of that industry confers a national benefit ? Why should the man who is encouraging the industry, and who is buying the material, be the only person to pay for this national advantage? ... A national advantage should be paid for out of the national Exchequer, and not out of the pockets of a particular individual who happens to encourage the production of a particular article.


Mr Thomas - We are with the honorable gentleman so far.


Mr AUSTIN CHAPMAN - That puts the matter very clearly. The Prime Minister was then in favour of encouraging this industry by the payment of a bonus. I hope we shall find that the right honorable gentleman is still in favour of that. At any rate, I confidently appeal to him, not only to stand by what he then said, but to view the matter from the point of view of compromise.


Mr Conroy - The right honorable gentleman merely pointed out that a bonus is less objectionable than is a protective tax ; but both 'are objectionable.


Mr AUSTIN CHAPMAN - The honorable and learned member for Werriwa will have an opportunity of explaining later on. The right honorable gentleman certainly pointed out that the iron industry is a national industry which will provide a great deal of employment, and that if he had his way he would encourage it by means of a bonus.


Mr HUME COOK (BOURKE, VICTORIA) - Has the right honorable gentleman told the honorable member that he will vote for this -Bill ?


Mr AUSTIN CHAPMAN - The honorable member for Bourke is busily engaged in asking questions, but I wish he would devote some little attention to the necessity for helping this matter along. This is a measure in connexion with which protectionists, no matter on which side of the House they may sit, should not squabble and fight amongst themselves. We have a right to expect that, no matter on which side they sit, they will render genuine assistance. I take it that there is no necessity to make any appeal to them. It is rather to those who were once free-traders that I appeal. I ask the honorable and learned member for. Werriwa to view this question now from the stand-point of the understanding, as it has been termed, that has been arrived at on this side of the House.


Mr Conroy - I -have done so, and I am dead against it.


Mr AUSTIN CHAPMAN - Freetraders ' have often, on public platforms in this country, pointed out that they are prepared to give assistance to the great primary industries, and I ask honorable members whether this is not the greatest of the primary industries, and to show by their votes that they are willing to respect the understanding that has been arrived at.


Mr Thomas - What understanding?


Mr AUSTIN CHAPMAN - I ask the honorable member for Barrier to respect the alliance he has made with the honorable and learned member for Indi. We know that that honorable and learned member bases all his complaints against those of us who sit in the Ministerial corner on the fact that they are the protectionists who desire' to give encouragement to industries. Since the Prime Minister has said that he has no objection to the granting of a bonus, and as we are all in favour of fiscal peace, I think that I can ask even New South Wales freetraders if they are prepared to allow the Tariff, bad as it is, to assist only industries in other States, instead of putting into force that portion of it which would give New South Wales her opportunity. While I ask the honorable and learned member for Werriwa to respect the understanding which has been entered into, I ask the honorable member for Barrier to stand by the alliance of which he is so proud. I think we can all agree that the Commission has proved the importance of the iron industry, and the need for establishing it in this country. When the matter was discussed before, it was doubted whether we had' sufficient deposits of iron in Australia to make the manufacture of iron here a commercial success; but the evidence taken by the Commission sets that doubt at rest. We know that there are rich deposits o'f iron ore in each of the States, and that there are men who are ready to embark their capital in establishing iron works, if they can get security, and are likely to obtain encouragement which will place the industry on a proper basis. Furthermore, Mr. Coghlan has officially stated that in New South Wales alone there is enough ore in sight to supply the Commonwealth for many years to come. This ore is situated close to large supplies of coal and limestone, and the necessary fluxes. Furthermore, Mr. Jacquet, who is an undoubted authority on the subject, he having given great time and attention to it, has shown that there are extensive deposits of iron ' ore in the different

States. Everything points to the fact that the iron industry, which is a' great source of employment in other countries, may be successfully established in Australia. But it cannot be established with out encouragement. Even in England, the iron industry was encouraged, the duty from 1798 to 1825 averaging £3 12s. per ton, and at times being over£6 per ton, which is ten times the assistance that we ask for. In America, where the industry was fostered, the gross production of iron in 1867 was 2,277 tons; in 1868,6,451 tons; in 1869, 8,616 tons; in 1870, 30,357 tons; in 1880, 864,353 tons; and in 1890, 1,871,425 tons. The importaton of rails of all kinds into America in 1867 amounted to 145,580 tons; and in 1881, to 344,929 tons; but by 1890 it had decreased to 204 tons. Englishmen now find even the home market invaded by Americans. Not only are many English bridges made by American firms, but many new buildings in London are constructed by Americans of Americanmade steel and iron. Let me read what the Times says on this point -

There seems now to be dawning the period foretold, for American makers are sending their surplus product, not only to markets that are common to both this country and themselves, but are attacking us in our strongholds at home. The Glasgow correspondent of Engineering, writing at the early part of November, says - " Steel rails continue to be very much depressed, most of the export orders being absorbed by the American mills at prices which British manufacturers cannot at present touch. . . . The abnormal demand of the United States for its own engineering products is fast slackening, thus bringing the marvellous increase of American manufacturing capacity of the last five years - perhaps more especially the last three years - to bear on foreign markets. It is a question to us paramount to all others. Even the efficiency of the navy is subsidiary to it, for if -we lose our engineering supremacy our naval supremacy will follow."

That shows what has been done by the encouragement of the iron industry in America. Great Britain was once supreme in the iron trade, but now, not only America, but even Germany is in front of her.


Mr HUME COOK (BOURKE, VICTORIA) - As this is an exceedingly important matter, I wish to call attention to the state of the House. [Quorum formed].


Mr AUSTIN CHAPMAN - Inboth Germany and America tens of thousands of people find employment in ironworks and kindred industries. The manufacture of iron has been a success in those countries, not because of their large populations, but because of the encouragement which their fiscal policies have given, to the industry. Not only are bounties paid for its encouragement, but cheap freights and other benefits are given to those engaged in the production of iron. Let us take the case of Canada, which possesses a population very little in excess of our own. What does Sir Charles Tupper say of the iron industry there? He says -

My honorable friend stated that the iron industry was one that the Government judged to be of great importance, for the reason that the wealth created by the development of this kind, of industry is almost wholly devoted to payment for labour. Thus it became an industry almost above all others that deserved a fostering care of the Government, if, by public aid, parties could be induced to bring in their capital, and develop the enormous resources which Providence has given us in the vast deposits of iron ore that exist in the different parts of the Dominion. ... I know of no measure, after the most careful investigation of this question, that can be adopted - no single points to which my honorable friend can turn his attention as inviting and developing industry, which will give a greater amount of employment, in proportion to the industry itself, to the people of this country - than the protection proposed to be given to the development of our iron industry. Two dollars a ton cost the country something, but they all contribute to it - it will be taken out of the general Treasury. But if we can put thousands of men to work in mining our ores, in a development of our coal, and in converting it into coke, and the smelting of this iron, we create a large industry in the country. We give employment to the people, who will eventually get their stuff as cheaply as before. That is the policy of the Government, and this is the outcome of that proposition.

I only wish that I could hear the Prime MinisFer utter similar sentiments to-night. Those remarks apply' to our present conditions exactly. We have the iron deposits, the coal, the limestone - in fact, everything that is necessary - and we also have men out of employment. Consequently we could not be charged with taking them away from other avocations. In this connexion, what does Coghlan say of New South Wales? He writes -

The iron trade should, in time, form one of the great staple industries of the colony. Every national advantage possessed by the great iron and machinery producing countries of the world - such as England and Belgium - is also present here. Not only are iron and coal deposited in abundance, and in. positions easily accessible and readily worked, but, as pointed out in the chapter on mines and minerals, the local iron ore is exceedingly rich. Scarcely any progress, however, has been made in iron smelting, and nearly the whole stock of pig and wrought iron required for the local manufactories is imported'. The other descriptions of metal works, both for smelting and manufacturing, are in a more forward state.

What did some of our most thoughtful protectionists think of this great question when they met in conference in the different capitals before the establishment of Federation? They arrived at the following resolution: -

That, in view of the enormous benefits which way reasonably be expected to accrue to the Australian Commonwealth from the establishment of iron and steel industries within its borders, this Conference recommends that such industries be encouraged by bonuses from the Federal Government for a stated period, to be fixed thereby, of ras. per ton for every ton of pig iron or steel ingots and bars, rods and sheets, whether of iron or steel, the produce of native ores and fluxes. That in order to encourage the manufacture of iron and steel goods, for two years after the imposition of the Federal Tariff, and no longer, a rebate, equal to the amount of duty paid, should be allowed on all pig iron and steel ingots, puddled bar, and steel blooms, and billets imported and actually used within that period in the manufacture of iron and steel goods of any class and character.

That is the opinion of thoughtful men, who believe in the encouragement of every class of industry. They point out that the iron industry is the base of all our manufacturing industries, and is consequently worthy of some attention. Since the period when that resolution was agreed to, matters have progressed somewhat. Owing to the labours of the Commission which investigated this question, we know a good deal more of the subject than we did, and are therefore in a better position to arrive at a sound judgment. Do not honorable members recognise that in the absence of ironworks in this country, we are upon a very insecure footing indeed?


Mr Mcwilliams - Does the honorable member propose to levy a duty upon iron ?


Mr AUSTIN CHAPMAN - I am asking that a bonus shall be paid upon the production of iron in Australia. Honoiable members must admit, whatever their fiscal opinions may be - and it does seem to me lamentable that we always have the old fiscal cries introduced - that all our manufacturing industries will continue upon a very insecure footing if we do not establish ironworks in this country. Under the circumstances, what should we do in a period of stress and trouble? What could we do in the way of defending ourselves against foreign invasion ? It was very easy for honorable members to cheer the Treasurer this afternoon when he announced that the Government propose to spend an additional £20,000 or £30,000 upon our guns and defences. But what should we do if our supplies were cut off? I fear that a state of panic would ensue. Consequently, honorable members who oppose this Bill must accept responsibility for their action. Some honorable members advocate the establishment of an Australian Navy. How is that possible, in the absence of local ironworks ? Are we to be satisfied with always having an army of unemployed? In a great industry of this character, we might well compare the position of Canada with that of Australia.


Mr Lonsdale - Canada puts its people on to the land.


Mr AUSTIN CHAPMAN - It is idle to deny that there are tens of thousands of unemployed in our midst to-day, and that business is bad, whilst in Canada, where high wages prevail, and great encouragement is given to the iron industry, there are no unemployed. In this connexion I should like to quote from the Statistical Year Book of Canada for 1902. It states -

In the session of 1894 an Act was passed providing that the Governor in Council may authorize the payment of a bounty of $2 per ton on all pig iron made in Canada from Canadian ore, or a bounty of $2 per ton on all puddled bars made in Canada from Canadian pig iron made from Canadian ore, and a bounty of $2 per ton on all steel billets manufactured in Canada from Canadian pig iron, and such other ingredients as are necessary and usual in the manufacture of steel billets. These bounties were applicable till 26th March, 1899, in the case of furnaces commencing operations subsequent to that date, but before 27th March, 1899, for five years from the date of commencing. This Act was repealed by Chapter VI. of the Act of 1897, which authorized the Governor- ' General to give (1) a bounty of $3 per ton on steel ingots manufactured from ingredients of which not less than 50 per cent, of their weight consists of pig iron made in Canada ; (2) a bounty of $3 per ton on puddled iron bars made from Canadian made pig iron ; (3) a bounty on pig iron manufac;tured from ore, of $3 per ton on the proportion produced from Canadian ore, and $2 on the proportion produced from foreign ore.

An Act of 1898 provided that the provisions of the Act are to be held to have come into force on 23rd April, 1897. An Act of 1899 provides that these bounties shall continue to be paid till 30th June, 1907, at a yearly diminishing rate from 1902-; 90 per cent, of the bounties to be paid in 1902-3; 75 per cent, in 1903-4; 55 per cent, in 1904-5 ; 35 per cent, in 1905-6J and 20 per cent, ia 1906-7.

Active works are carried on by seven companies, and the annual aggregate capacity of all the completed and unfinished furnaces is nearly 1,100,000 gross tons. The Lake Superior Power Company are building a very extensive plant for the manufacture of pig iron, steel, and steel rails, the latter the first established in Canada. The united investment amounts to .24,500,000 dollars, which will be increased to 35,000,000 dollars by new plant now building. Within five or six years the total investment in the iron industry of the Dominion will aggregate, approximately, 50,000,0110 dollars.

That is my answer to those who say that if we grant a bonus we shall create a monopoly ; that is my answer, and I think it is a most emphatic one, to those who say that if we grant the proposed bonus there will be no competition in Australia. Let me make a further quotation. It is here pointed out that -

On December 31, 1902, the unsold stocks of pig iron in Canada amounted- to 20,328^ gross tons, as compared with 59,472 tons at the close of 1901. On December 3J, 1902, there were twelve completed furnaces in Canada, and four furnaces were in course of construction. Of the completed furnaces seven were in blast and five were idle on the date named. During 1902 four new furnaces were erected.

That, again, is my answer to those who say that the success of the industry in the United States, Germany, and other countries is due to their large population. In Canada, with a population but slightly in excess of our own - a population living under a Government practically similar to that of the Commonwealth, and working under the same conditions - this splendid result has been attained. It is no wonder that a number of the young men of the Commonwealth are crossing the seas and seeking employment in Canada. The article continues -

In 1901 the total quantity of iron ore consumed was 517,623 tons, of the value of $1,390,542. The quantity of charcoal used was 1,835,736 tons, of the value of $100,978; of coke, 321^63 tons valued at $1,036,714; while the quantity of coal used was 2,039 tons, valued at $6,117. Of flux consumed, this amounted in the year 1901 to. 169,399 tons> valued at $183,162. The total value of the pig - 274,376 tons - was $3,512,923, or i2'8o dollars per ton. The value of the exports of iron and steel goods manufactured in Canada during 1896 was $522,988; in 1902 it had jumped to $2,460,781.


Mr Conroy - That is about £480,000.


Mr AUSTIN CHAPMAN - Even if that be so, it would be very pleasant if, besides supplying our own wants, we could export every , year nearly £500,000 worth of manufactured iron goods, thus giving employment to our people, and bringing money here instead of sending it away. We all know that every care has been taken to ascertain whether the industry can be established on a commercial basis if fair encouragement be given and reasonably fair conditions imposed. We know that thousands of pounds have been expended by private individuals in obtaining reportsbearing on this question. One of the best experts in the world visited Australia to inquire into the question. I understand that as high a fee as £3,006 was paid to one expert to visit Australia and report on the extent of our iron deposits and their commercial aspect. He reported in favour of the establishment of the industry, and certain gentlemen interested iri the question had every reason to believe that they could secure the investment of £1,000,000 in the establishment of the industry in Australia if it could be shown that reasonable consideration would be extended to it by the Commonwealth.


Mr Conroy - That was prior to Federation, was it not?


Mr AUSTIN CHAPMAN - We know that men of enterprise are waiting to see what will be done by the Commonwealth. Are we to keep this matter dangling in front of their eyes? Are we going to say that we 'think it would be better for the States to take up the industry? This morning's newspapers contain reports of a meeting, held in Melbourne by a labour union, at which it was decided to suggest to the Government that some provision be inserted in the Bill, giving the Government power to resume the works if the industry be taken up by private enterprise." We know, however, that the Government always have power to resume.


Mr Crouch - That is provided for in the Bill.


Mr AUSTIN CHAPMAN - Yes ; but even if it were not, the Government would be able, at any time, to resume the works. The real kernel of the question is whether we are going to give encouragement to private individuals to establish the industry, or really to .defeat the whole thing by asking the States to take up the industry. What would be the use of our doing so? We have already appealed to the States. What was the answer made by the New South Wales Government to the inquiry of the Commonwealth whether it would be prepared to take up the industry? The honorable member for Bland said that the feeling was so strong in New South Wales that, with a little agitation on the part of the public, he believed that the then Government - the See-O' Sullivan Administration - would take the matter in hand and establish a State industry.


Mr Kelly - That Government has disappeared.


Mr AUSTIN CHAPMAN - But we received an answer from them. That Government had a strong labour backing, so that they were more likely to make the industry a State-owned one than was any other Government that had been in power in New South Wales for some time. They said that they were not prepared to embark in the industry, and suggested that it should be handed over to private enterprise. I take it that that is the opinion entertained by a great many honorable members. We have had most emphatic statements from the Governments of. other States in regard to the question. The Governments of Queensland, South Australia, and Tasmania are not prepared to take up the industry, and consequently we may well ask ourselves, " What are we going to do? " Are we going to give encouragement to private enterprise,or to shelve the whole matter? -We cannot get away from the fact that every honorable member who votes to make this industry a State-owned one, will vote to shelve it.


Mr Thomas - Then I am prepared to vote to shelve it.


Mr AUSTIN CHAPMAN - The honorable member is not prepared to give any encouragement to the industry, although the miners in his own electorate have been assisted by the Commonwealth. He was willing to ask that they should receive every consideration in the direction of low duties on the timber .required by them - he was ready to advocate that they should be allowed to obtain everything that they required in the easiest manner, but he is not prepared to say to those who want work, and cannot obtain it at Broken Hill, that they shall receive assistance. I shall be astounded if the honorable member finds himself in a position to tell the workers of Broken Hill that his policy is that so long as they are not lacking employment he does not care who else goes without work; that he does not care whether there are j 0,000 unemployed in other districts; that he does not care whether men are idle in my electorate and those of other honorable members. I shall be surprised if he dares to go on- the public platform at Broken Hill and make such a statement, and even more surprised if the support on which he depends so largely for assistance will help him in taking up that position. I, for one, am not prepared to adopt such an attitude.


Mr Thomas - What does the honorable member think about-


Mr AUSTIN CHAPMAN - I would again remind the honorable member that it would be much better for him to make a speech when the opportunity offers, and to refrain from interjecting and irritating other honorable members when they are speaking. I find, on reference to the report, that the estimate of Mr. Jacquet shows that the amount of ore in sight is approximately 50,000,000 tons. There can be very little doubt, however, that there is much more actually in sight in this country. Of course in making official estimates a man who has a reputation to lose is very particular not to make a mistake, or, if he errs at all, he takes care to err on the right side. I find that as much coal has been taken out of England as was estimated to be in sight sixty years' ago. Yet the supply of coal from England appears to be inexhaustible. In America, the amount of iron ore taken out and used in manufactures exceeds the original estimate. Yet there are 650,000,000 tons of ore in sight to-day. No 'industry gives greater employment, or causes a larger percentage of money to be expended in wages than the iron industry. Consequently there is no industry that distributes a larger percentage of money throughout the community. It must also be remembered that at least one-third of the total amount of iron used in Australia is used by the States. Probably it may be said that one-half of the total is used by them in one form or another. Therefore, if it is decided to give some of the money of the whole community for the encouragement of the iron industry, a very large amount of the money thus expended goes back into the pockets of the people. Not only do our resources warrant us in expecting that in a short time we shall be able to supply our own needs, but we ought soon to be able to compete in the markets of the world. Because it has been proven that we have in Australia cheap coal, and that suitable limestone flux is to be found alongside the coal and ore deposits.


Mr Conroy - What quantity of iron would be required in Australia per annum? Not more than 35,000 tons.


Mr Deakin - That is the1 amount at present.


Mr AUSTIN CHAPMAN - The amount required at present would probably be more than doubled after a few years. It is difficult to say what quantity would be required when the industry had established itself. The figures from the United States and Canada show that in those countries the iron industry has progressed by leaps and bounds. The facilities for iron production in Australia are so great that there can be very little doubt that the industry will make rapid progress. As a matter of fact coal can be raised at Lith gow and taken to the place where it is proposed to establish the iron works at 3s. per ton. It is well known that iron ore can be raised cheaper in Australia than in America. It is not contemplated that we shall only establish works at an expenditure of ,£100,000 or £[200,000. We require to have properly equipped works, costing, probably, from £500,000 to £1,000,000, together with every facility for producing and treating ore, and dealing with this great iron industry. There is no telling what quantity we shall be able to use and export when we have those facilities.. At present there is a difficulty in the way of freights. The freight from Lithgow to Sydney is 11s. 2d. per ton, whilst it is well known that iron has been brought to Australia from England at freight as low as 2s. 6d. per ton. Consequently there can be very little doubt that some consideration will have to be extended to the industry in the way of cheap freights. That is one of the considerations that has been asked for time after time whenever contractors have placed large orders. Some such system will probably have to be tried as has been brought into existence in the case of the flour industry. For instance, in New South Wales, wheat which is grown out west is sent down as far as Bathurst, where it is treated and turned into flour. It is then sent on its journey to Sydney at a low freight. That system- has been adopted in order to enable such industries to be established in country places. Something of the same kind is necessary in connexion with the iron industry. I should like to point out what were the experiences of Mr. Rutherford, at Lithgow, many years ago. He established iron works on a small scale, though sufficient for the time. After getting everything in order and producing some iron, he made certain offers to the retailers in Sydney. He offered to put the iron bars and other iron work which they required into their racks and stores, and to wait for his money until such time as they had placed the iron with purchasers. At that time the selling price was £14 per ton. Mr. Rutherford asked .£10 per ton, "thus enabling Eis customers to make a profit of 40 per cent. They held a meeting, but being importers, and knowing what it would mean if a local iron industry became firmly established, they declined to take any of his iron. That is one of the difficulties that the industry has had to contend with. It shows that unless those who establish iron works get some encouragement and fair consideration, there is no security for the capital that they invest. They also have to contend with the difficulty of dumping. Honorable members all know what that means. I wish to say s a word or two as to the contention which is bound to be raised as regards the States undertaking the iron industry. I should like some honorable members who support that contention to show that there is any probability that any of the States will take up the iron industry. The honorable member for Melbourne Ports put the matter well on the last occasion when this subject was under discussion, when he said that to decline to pass this measure, because the States were likely to take up the iron industry, was simply to use an indirect method of defeating the Bill. Different estimates have been made as regards the cost of establishing iron works. It is said that works can be established in Australia at a cost of £j 00,000. No doubt it is possible to establish works at any cost. It has been pretty clearly proven that proper works, fitted with an adequate plant and all the appliances for coping with this great industry under reasonable conditions making for success, . would demand the expenditure of at least £250,000, and probably £500,000. I was informed, on good authority, that the estimate of the promoters of the Blythe River Works, included provision for steamers for sending the ore from Tasmania to the mainland, as well as for works, mining appliances, and plant, was about £1,000,000. But even with an investment of £500,000, one can easily understand what work would be given, and what a tremendous impetus manufacturing industries would receive. At any rate, so far as we can ascertain, it will require from £300,000 to £500,000 to establish the industry. As regards the quality of ore, I remind honorable members that iron made from Australian ore was at one time sold in America, and word was received here that the manufacturers there were prepared to take more of the Australian' article. That occurred some thirty years ago; the ore was from the Fitzroy mines at Mittagong; and the fact is sufficient proof, if any further proof be required beyond .the evidence of experts, that this is an industry which ought to be established in Australia. If we decide, as I hope we shall, to extend, this consideration, those who seek .to enjoy it, besides incurring the heavy expenditure in starting the works, will have to produce £1,000,000 worth of iron, before they can receive the whole of the bonus. That, in itself, should be a strong inducement to honorable members to support the Bill, and there is no doubt that: to postpone the question, or to endeavour to get the States to seriously entertain the idea of undertaking the works, will be throwing away the substance for the shadow. But for the evils of dumping, and of trusts and other combines, it would almost appear as if the prospects were good enough without any bonus; but the latter represents a guarantee from the Commonwealth that reasonable fair play will be given. There is no necessity for. me to weary honorable members with any further evidence, though I should like to quote the following from the Melbourne Age, of Friday, 9th September, last : -

The hostility that is shown in some quarters, and the apathy in others, in connexion with the development of the iron resources of the Commonwealth are in marked contrast to the feeling manifested in Canada towards the similar resources of that country. For some years the Dominion Government has recognised the value of an iron and steel industry, and in 1S97 instituted a bounty system that has proved a great success.

The Agc goes on to point out what the expenditure has been in Canada -

This will be seen by the steady increase in the production of pig iron. In 1898 the total was only 68,000 tons ; in 1902 it had swollen to 319,600 tons, and it is still growing rapidly.

The article mentions the recent action of the Dominion Government in ordering 10,000 tons of steel rails from the local works, and the efforts made to assist the. industry in every way.

Why Australia, with equally rich deposits or iron ores, failed to take advantage of this source of wealth deserves consideration. First, there has been the opposition of the importer, who makes large profits out of foreign manufactures of iron and steel, both in connexion with heavy Government contracts, and with ordinary market supplies. Then the shipping interests that bring these enormous imports over the sea are naturally strong opponents of any innovation that would deprive them of any share of their business. Then, again, there are the faddists, who have an idea that the iron industry should be Government owned. This section fails to understand that it will require millions sterling to provide works in all the States of the Commonwealth, and that none will agree to the proportional expenditure in one that is not shared by all.

The expenditure, to which I have referred is not the expenditure for the whole of the Commonwealth. No one State will have a monopoly of the industry. There are splendid deposits in each of the States, and freight considerations will, doubtless, insure the erection of plant in nearly every one. The investment of money under such circumstances, will, in a very short time, run into millions of money, and I recommend the following to the consideration of honorable members : -

The millennium is still a promise of the distant future, and to wait for the State establishment of Australian iron and steel industries means losing sight of the practical duties of everyday life. Dreamers have no place in this progressive age, And though their Utopian ideas may attract followers, any attempt to work out their system is certain to result in failure. If the representatives of the people in the Federal Parliament have the true interests of the community at heart, and are not biased by personal ideas or influences, action should at once be taken to give to Australia advantages similar to those enjoyed by Canada. Last year the value alone of iron and steel rails, girders and the like, imported into Australia was £2,303,333 ; whilst machinery which could be largely made within the Commonwealth if local iron works were available came to £1,342,332, and subheads another £245,888. A very large proportion of the money sent away to pay for these imports might have been expended locally, with most satisfactory results. There are constant complaints from every State that labour is not employed. In a new country such complaints should r.ot be heard, and the fact that they are heard may be traced to the channels of employment being neglected. Repair and extend these, and lbc answer to the ever raised cry for work will bi found. The Government is aware that there are' private individuals who, if they receive the same treatment as the Canadians, are willing to embark their money in building up an Australian iron and steel industry. Whether the venture will prove profitable is difficult to determine, but, that its initiation will carry heavy risks must be admitted.

Again I invite the attention of those who are desirous to see the States undertake the work, to the following words from this good commercial authority : -

The bonus cannot be claimed until it is earned, and to earn it a big outlay is necessary. Surely those who take this risk upon themselves are entilled to :he insurance consideration which a bonus represents. Unfortunately Australian politics are not practical in character, consisting to a considerable extent of talk and fighting between the " ins " and the " outs" over matters of secondary interest a.- far as the wants of this suffering community are concerned. Canada, it may be admitted, had te pass through an ordeal much like our own.. Why should .Australia not profit by experience, which, though purchased by a period of depression, has culminated in prosperity and success?

The case is as well put there as it could be put by any one. The article contains suggestions, over which we ought to ponder - it would be very difficult to dispute anything which the writer states. Let us now read an extract from the report of the Chamberlain Commission published in the

Sydney Morning Heraldof 28th August, 1904. It says -

Our inquiry has shown (1) that the iron and steel industry of this country has declined relatively to that of other countries; {2) that our export trade to foreign countries has diminished, while that to the colonies has increased; (3) that, although our trade with the colonies has increased, the colonial market is increasing much more rapidly, and that foreign countries are securing a growing proportion of this colonial trade ; (4) that the relative decline of the British iron and steel industry is not due to any natural British disadvantages, or want of skill and enterprise on the part either of British manufacturers or of British workmen ; (5) that it is due to the fact that the manufacturers of the United States and Germany, having secured control of their home markets by means of high tariffs and an organized system for the regulation of their export trade, are in a position to dump their surplus products upon the British and other markets, irrespective of cost; (6) that the practice of dumping could not be carried on by foreign countries but for the British system of free imports.

The article points out that the British system of free imports is bound to induce dumping; and the protection such as this Bill proposes to give, would encourage a better system, and afford that protection to which the industry is entitled.


Mr Crouch - Is that an original article ?


Mr AUSTIN CHAPMAN - It is the report of the Chamberlain Commission, and it affords evidence which we ought to consider very carefully. There is another matter which I should like to bring under the notice of honorable members. It will probably be said that those who are engaged in this industry will be prepared, if they can obtain certain contracts, to carry on their works without the special consideration offered by the Bill. I have here the terms of an offer made to the Government of New South Wales by Mr. Sandford, of Eskbank Iron and Steel Works, Lithgow. Tenders were called for, and Mr. Sandford, to put the matter briefly, offered, if he were given a contract for five years, to supply the Government with all the rails and iron work required, at the average prices which have prevailed for the last five years. Mr. Sandford, of course, would allow the Government to stipulate in regard to quality - no product need be taken until it is absolutely certain that the quality is equal to that of the imported iron.


Mr Carpenter - Is that the English price, or has the freight to be added ?


Mr AUSTIN CHAPMAN - It is the price of the article delivered here, I should say. Mr. Sandford goes further, and says that if he could obtain that contract he would be prepared to hand back to the

State whatever bounty might be paid to him on the iron which it bought from him, showing that the industry is capable of being established on almost a commercial basis. He shows his bonâ fides when he makes the proposal. He looks upon a contract as being, to a certain extent, almost as good as a bonus. That I take it is what the Prime Minister believed when ihe encouraged the late Mr. Mitchell to establish ironworks in New South Wales. He was prepared to give that gentleman certain contracts, which, to a very large extent, would be almost as good as a bonus. Mr. Sandford agrees not only to do that, but also to pay the best wages. There is no question as to what wages are paid in this industry. To those who say " shelve it," or who do not want it, I commend a copy of an agreement which was voluntarily made by Mr. Sandford with his men at a time of distress in certain branches of this industry, which he had established at Lithgow. It was mutually agreed that certain reductions should be made in the wages, and should be operative for a certain time, so that he might be able to carry on those branches. It took 15 per cent, off wages over 16s. per day, 10 per cent, off wages at 16s. and over 12s. per day, 5 per cent, off wages at 12s. and over 8s. per day. From those figures one can easily gather that good wages were being paid at Lithgow.


Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - What is the honorable member referring to?


Mr AUSTIN CHAPMAN - I am talking about the wages paid in certain branches of the iron industry at Lithgow, in the honorable member's electorate. I have here a statement of the wages paid to sheet mill hands in Lithgow for three months -

Sheet Mills. - For three months from the day of commencing work, the following rates to be paid for a working day of eight hours, such rates to be net, with no percentage deducted or added : -

Sheet-mill roller, 17s. per day, with is. per ton on output for assisting roll-turner.

Sheet-mill furnaceman,11s. per day.

Sheet-mill shearer,11s. per day.

Pile heater, 10s. per day.

Catcher, 8s. 6d. per day.

Screwer and matcher, Ss. 6d. per day.

Bull doger, 7s. per day.

Shearers' helper, 7s. per day.

Close annealer.11s. 6d. per day.

The two or three lower amounts, I am informed, are paid to boys. That list in itself is sufficient to show what wages are paid, and should, I think, appeal to those who "desire to give employment in this country. In all the offers which Mr. Sandford has made, hehas been quite prepared to agree to the insertion of a clause in any contract to allow the State to resume his works at any time. In this contract he has made a definite offer to the States, that they should be allowed to resume his works at anv time. For. instance, one clause is as follows : -

In the event of the Federal Government giving bounties for the manufacture of iron, such bounties received for each class of material supplied under this contract to be returned in full to the Railway Commissioners.

Of course, it is open to honorable members to ask - " Why should we give a bounty ?" But I submit that good reasons have been shown outside that consideration. It is held that a large contract would be equal, in some cases, to a bounty. If a man had a large contract like that, he' would be practically guaranteed, to a very large extent, against unfair competition, in the shape of large consignments being sent in and sold at a loss. It has been demonstrated from their balance-sheets, beyond all dispute, that as regards wire-netting, the Germans lose on their export trade to this country, and make a large profit at home. But immediately an industry has been crushed out here they obtain their own prices, and quickly get a profit.


Mr Kelly - Does the honorable member say that the German manufacturers tax their own inhabitants in order that they may make a profit there, and dump goods here at a loss?


Mr AUSTIN CHAPMAN - I do not say anything of the kind. What I said was that the Germans, who have a large wirenetting industry, have for some time past been losing on their export trade to Australia, while their balance sheets show that they are making a lot of money in the aggregate.


Mr Kelly - That is from their own people, I suppose?


Mr AUSTIN CHAPMAN - They can have only one object in taking that course. That occurs not only with wire netting, but with many other things.


Mr Conroy - I know many farmers who would be very glad to get wife netting at half the price.


Mr AUSTIN CHAPMAN - I should be glad to see the farmers in my electorate get their wire netting at half the price. I maintain that once we established the works in this country the price would soon be reduced. The evidence all points to that conclusion.


Mr Conroy - I thought that prices were only, reduced by lowering wages?


Mr AUSTIN CHAPMAN - The honorable and learned member thinks a number of things which will not stand analyzing. I do not wish to introduce the protectionist argument, because I expect to receive support from other than protectionists. Otherwise I should be prepared to produce, in a friendly way, some of my honorable and learned friend's references to bonuses; I hope to hear him speak to-night.


Mr Crouch - What is the state of the negotiations between Mr. Sandford and New South Wales?


Mr AUSTIN CHAPMAN - The negotiations have been going on. The cry always is, "Wait, wait!" But what "does it matter to us what is the state of .the negotiations between any of these men and New South Wales? We are not advocating this proposal ' for the benefit of Mr. Sandford, or any one else. Our desire is to establish the iron industry on a solid footing in this country. I give these particulars, because I think it is evident that there is a desire on the part of those interested in the iron industry, to strain every nerve to get an assurance, as the Age puts it, or a guarantee, that they will not be dumped out of the business, and will be able to find employment for our own people, especially in supplying the States Governments. I believe that the Premier of New South Wales is to give an answer to Mr. Sandford this week. We do not need to consider who is going to make rails, .or do something for its Railway Commissioners, and say, " Well, it is all right now ; there is a start made." We desire the industry to be started on a proper basis, as it has been in " other countries, so that it may grow and flourish, and we may be proud of its success.


Mr Thomas - What about zinc spelter?


Mr AUSTIN CHAPMAN - I shall say something about zinc spelter, but I take it that that matter is entirely in my honorable friend's hands. I wonder if he will ask us to " shelve "' that. The Royal Commission consisted of the right honorable member for Adelaide, the honorable and learned member for Darling Downs, the honorable and learned member for Corinella, the honorable member for Melbourne Ports, "the late Sir Edward Braddon, the honorable member for Newcastle, the honorable and learned member for West Sydney, Mr. S. W. Cooke, Mr. J. W. Kirwan, the honorable member for Illawarra, the honorable member for Bland, and the honorable member for Parramatta. Although it consisted of six professed free-traders, and six professed protectionists, still, strange to say, the majority report, recommending the bonus, which was indorsed by the Chairman, was signed by five protectionists, and .the late Sir Edward Braddon. The minority report was signed by five professed free-traders, and the present, leader of the Opposition, who is now so strong on alliances, but who, on that occasion, even differed from the honorable and learned member for Darling Downs.


Mr Groom - The honorable member will be on safer ground if he will keep to the merits of the case.


Mr AUSTIN CHAPMAN - We find the honorable member in very bad company, when he is with the honorable member for Illawarra, and the honorable member for Parramatta.


Mr Tudor - What about the company the honorable gentleman was in last week?


Mr AUSTIN CHAPMAN - I mean fiscally. If I 'am asked to account for the vote of the late Sir Edward Braddon, I put it down as the vote of ripe experience, the vote of a man who was prepared to put above a mere fiscal cry the prosperity of a great industry, and the encouragement of the employment of our own people in developing it. I ask in return, how my honorable friends opposite account for the presence of the present leader of the Opposition in the camp in which he was found on this question. I point out also that in the same camp we had another ex-Minister, in the person of the honorable and learned member for West Sydney. If the recent political trouble through which we have passed has done nothing more than bring these honorable gentlemen and the honorable member for Barrier into a fold where they can honestly and sincerely stand shoulder to shoulder with the honorable and learned member for Toowomba, who was on the right side in the Bonus Commission, then the trouble they caused me - and about which I have never complained, though, of course, it was no pleasure to me to walk out of office - will not have been suffered in vain. I hope that the alliance will be found to be very much stronger, and will stand better together in the future than I am afraid can be hoped of some other alliances. This is a question which will test the sincerity of honorable members. We shall see whether they are prepared to give reasonable encouragement to the establishment of a national industry. Paragraph 3 of the report submitted by the Royal Commission, reads as follows: -

The evidence has satisfied us that all the materials necessary for the manufacture of iron from its ores are to be found in various parts of Australia in large quantities and of good quality, and under conditions suitable for the successful establishment ofthe industry under proper encouragement.


Mr Johnson - Nobody disputes that.


Mr AUSTIN CHAPMAN - I am very glad the honorable member admits it. I presume he will go a little further and agree with what the Commission say, in paragraph 5 of their report -

Little attention has hitherto been given to iron mining in Australia, and your Commissioners are of opinion that future operations are likely to result in further valuable discoveries of iron deposits.

I have no doubt that honorable members will all agree to that. There is no question that we have valuable deposits, and that further discoveries of rich deposits are likely. In paragraph 6 of their report, the Commissioners say -

Iron and steel are largely consumed in the Commonwealth, as appears from the figures contained in the two succeeding paragraphs.


Mr Johnson - If they can be made cheaper here, why do they not start their manufacture at once?


Mr AUSTIN CHAPMAN - I have given some reasons why I believe iron and steel can be made cheaper here. Eventually, I have no doubt, that they will be. made cheaper. Coal is cheaper, the ore can be raised more cheaply, but we must have some protection for our wages. Until we get a fair start we must get some protection, in the shape of a bonus or contract, against unfair competition. When we have wonderful iron resources in this country, and there are tens of thousands of people looking for work, I ask why we should refuse to give encouragement to the establishment of the industry in the way of a bonus of , £250,000, distributed over a number of years - because I suppose it will take from eighteen months to two years before £1 of this monev can be claimed, and £1, 000, 000 worth of iron must be produced before the whole of the proposed bonus can be claimed ? Paragraph 7 of the Commission's report reads as follows : -

The following are particulars of the iron and steel imported into the Commonwealth during the years 1902 : -

Pig iron, 28,029tons, valued at £98,373.

Bar and rod, 38,282 tons, valued at £334,636.

Plate and sheet, 22,627 tons, valued at £178,548.

Scrap, 10,408 tons, valued at £32,907.

Galvanized iron, 44,538 tons, valued at £739,596

Rails, valued at £391,822.

Wire (plain), valued at £369,383.

Wire (barbed), valued at £71,426.

Wire netting, valued at £135,169.

Pipes, valued at £298,183.

In addition, iron and steel machinery to the value of £2,022,515 was also imported during the same period.

The total value of these importations is £41675,538. The figures speak for themselves, and require no argument.


Mr Thomas - Those imports include machinery.


Mr AUSTIN CHAPMAN - That is so; and one can understand what a tremendous impetus to employment the establishment of this industry would give. Honorable members must be aware that iron enters into almost every manufacture and every industry. The production of watches, machinery, ships, guns, agricultural implements, furniture, fences, and many other things, are all dependent on iron to a certain extent, and therefore nobody will dispute the fact that the industry should be established if by some means of encouragement we can secure cheap iron. The honorable member for Lang has asked why we should demand this bonus when persons are almost prepared to carry on without it, but I ask the honorable member whether it is not better that we should stimulate the industry?


Mr Thomas - We cannot understand why no Government will take up the industry if it can be carried on profitably.


Mr AUSTIN CHAPMAN - I agree with the honorable member that if we cannot get private enterprise to take up the industry, we should, if we can, get a Government to take it up, but, unfortunately, we cannot Of what use is it for the honorable member to contend that a State Government should take it up when we have had an emphatic " No " from all the States Governments? The imports referred to in paragraph 7 of the report are not for an extraordinary year, because we find in paragraph 8 ofthe report that the average iron and steel importations into the Commonwealth during the five years ending 31st December, 1902, were valued at £4,517,139.

That is to say, that in five years we imported between £20,000,000 and £25,000,000 worth of iron and steel to this country. Can any one wonder that we do riot progress as we might, when we are wrangling over the question whether this great industry should be established by State or by private enterprise? I ask honorable members whether it is not better to allow private enterprise to take up the establishment of the industry under the provisions of such a measure as we have how before us, which would give the States power to come in at any time, and take over the works, even though they had proved to be a success? I admit that it is open to argument that it might scarcely be fair to those who put money into the enterprise, to have it left to them if it fails, and to have the Government step in and take it over if it proves a success. But we find that there are men who have the trust which most of us have in the spirit of fair play in this country, and are willing to take the risk. I do not wish to quote at length from the report of the Commission, because I suppose honorable members have looked into it themselves.


Mr Thomas - There is something in the report about zinc which the honorable gentleman might quote.


Mr AUSTIN CHAPMAN - The honorable member will be able to quote that for himself presently. Paragraph 3 of the minority report reads -

The Bill provides for the payment of £324,000 of the people's money to private individuals engaged in an enterprise for their private gains. There can be no guarantee that the bonuses proposed would permanently establish the industry, tho ugh it is probable the inducement offered might be instrumental in forming speculative companies.

That seems to me to be a rather peculiar clause to appear over the signature of the present leader of the Opposition, and especially as the £324,000 is not for pig iron alone. Only £250,000 of that amount represents the bonus proposed to be granted for the production of iron. The balance is intended to be disbursed by way of encouraging the production of spelter, and the manufacture of wire-netting, and reapers and binders. I should like honorable members to compare the statement which I have read with paragraph 7 of the minority report of the Commission, which says -

The evidence failed to show that there was any commercial necessity for the bonuses proposed. Mr. Sandford said he could produce pig iron at

Lithgow under 35s. a ton. Allowing for freight to Sydney, Melbourne, and other parts of the Commonwealth, he could, on this showing, compete favorably with any imported pig iron. Other witnesses, who, however, had less experience than Mr. Sandford, doubted the correctness of his estimate of cost. But, on the supposition of his having made an under estimate, he would still, even without a bonus, be in an excellent position as compared with the imported commodity.

That is a curious method of reasoning. In paragraph 3, the minority report, which was indorsed by the leader of the Opposition, who, no doubt, wishes the industry well, emphasizes the fact . that there is no certainty that the granting of a bonus will result in the establishment of the iron industry, whereas paragraph 7 affirms that the prospects of such an enterprise are so good that no bonus is reouired. I repeat that the passage of this Bill would provide a large measure of employment. It is estimated that 1,000 men would probably start work immediately.


Mr Conroy - Who estimates that?


Mr AUSTIN CHAPMAN - Mr. Sandford'sestimate was that within one month he would be able to start 400 men at Lithgow. We have the testimony of quite a number of experts that, if the industry were properly established, it would mean the employment of 12,000 men.


Mr Conroy - Why not 12,000,000 ?


Mr AUSTIN CHAPMAN - Does the honorable and learned member know tliat £4,500,000 worth of iron manufactures is annually imported by Australia? How many men would be employed by the expenditure locally of only a portion of that sum? I dare say that the time will come when more than 12,000 men will be engaged in the iron industry in Australia, but that will never happen if we do not develop our own resources. Is the honorable and learned member for Werriwa aware that more than 12,000 men are engaged in one of the iron establishments in Germany?


Mr McDonald - And does the honorable member know that one up-to-date furnace would supply the wants of all Australia?


Mr AUSTIN CHAPMAN - I am not merely referring to the men who would be engaged around the furnace, but to those who would be employed in the production and manufacture of iron and the products of iron. What about the individuals who would be required to mine the coal and to get the necessary limestone? What about those who would be employed upon the railway ? What about the freight which would be paid by these works? Are we to continue to send to England hundreds of thousands of pounds for the purchase of guns and all sorts of warlike stores,, which might be made in this country ? Are honorable members prepared to depend indefinitely upon other countries for these materials, or are they willing to wait until somebody embarks upon the enterprise of his own volition? In speaking at a public gathering yesterday, the honorable member for Newcastle said -

There were too many hungry men in Australia to let Mr. Reid get into recess and go to sleep.

There is something in that statement. But do not let us continue in session for the mere sake of talking. Let us do something. I do not desire to weary honorable members, but I should like to say a word or two in reference to wire netting industry and spelter. As honorable members are aware, the netting is made from imported wire. We all know the result of our having refused encouragement to that industry, in which £150,000 has been expended in plant. In Lysaght's establishment, in Sydney and Melbourne alone, about 500 men were employed. Honorable members are aware that the works in Victoria have been closed down, and that the Sydney works are upon the point of closing down. Unless some consideration is extended to this industry, it is only a question of weeks, or, at the outside, of months, when the great works upon the Parramatta River will be closed. We shall then find a marked difference in the price which we shall be called upon to pay for wire netting.


Mr McDonald - When the Tariff was under consideration, New South Wales was held up as the shining example of a country where no duties operated.


Mr AUSTIN CHAPMAN - Upon that occasion a number of things were held up as examples, but they were very bad examples. In the light of experience, it would be well for us to face facts in a plain, straightforward way. It was demonstrated by a deputation to the late Prime Minister that unless some 'consideration is extended to this industry, the works to which I have referred must be closed down. It has been shown beyond doubt that the reason for the decline in their trade is that Australia has become a dumping ground for Germany. Not only does Germany give bounties to encourage this industry, but it offers cheap freights over the railways, and subsidizes ships to bring its goods here. Unless we do something to counteract the policy of that country, these works will discontinue operations. The honorable and learned member for Werriwa will then find that farmers in his district will be called upon, to pay an increased price for their wire netting. The honorable member for Barrier seems to regard the proposal to assist the production of spelter as a good subject for a joke. I am inclined to think that an expenditure of £20,000 would help it very materially. At any rate, I shall be interested to learn from him why the proposal should be omitted. If he can show why it is not necessary-


Mr Thomas - Does the honorable member think that it is necessary ?


Mr AUSTIN CHAPMAN - Yes. I do not wish to introduce any protectionist or free-trade arguments into this matter, because by so doing I should perhaps create an awkward position.

Mr- Webster.- Why do not the Government take up the measure ?


Mr AUSTIN CHAPMAN - It is difficult to understand the attitude of some honorable members who continually ask ' that question. Why did they not ask it while the late Government held office? Why do they desire to introduce party bitterness into this discussion? It seems to me that it would be a good thing for .this country if we could induce the Government to regard more of these great questions as open questions, so that we should not be dragooned into moving always on party lines.


Mr Webster - What becomes of responsible government under such circumstances ?


Mr AUSTIN CHAPMAN - The responsibility rests with this House. It does not rest with me. What more have I to do with this Bill than has the honorable member himself?


Mr McDonald - Absolutely nothing.


Mr AUSTIN CHAPMAN - Quite so. It is for honorable members to express their opinions, and for the majority to determine whether the iron industry shall be established in this country, and whether they are desirous of providing work for the thousands who are unemployed. All the evidence taken by the Commission shows that this industry would be the greatest employer of labour in Australia. Moreover, it is the base of many other industries. Consequently, we have to ask ourselves the question, " Are we disposed to give the people work?" If so - and I believe that a majority of us are - we must necessarily ask, "Who should undertake this work? Should the State, or should we give some encouragement to private enterprise?" If we adopt the latter course, we are likely to secure an early establishment of this great industry. By granting a bonus for the production of iron, we should induce competition, and we should probably have works established in every State. We were told that with the accomplishment of Federation the market of the States would be broadened, so that in time the cost of our products would be reduced. That being so, why should we introduce provincialism? We know that it would be very difficult to induce any of the States to take up the industry. What would be the use of asking the Tasmanian Government to establish works on the Blythe River, or of requesting some of the other States to take up the industry? Some of them have not been able to deal with what, from the point of view of the States, are more legitimate undertakings. The great States of Queensland, South Australia, and Tasmania have not even been able to provide for old-age pensions. In these circumstances, would it not be useless to ask them to establish ironworks which would involve the expenditure of large sums of money. Would they not hesitate to do so? Why should we not take a practical step? I would again quote the remark made by the honorable member for Melbourne Ports, when the matter was before the House on a previous occasion, that every honorable member who votes to hand over the establishment of the industry to the States will vote for the defeat of the project. I would have no strong objection to one of the States taking up the industry, if any of them would do so, but I believe that the work can be undertaken with greater advantage by private enterprise. We all know that private enterprise is ready to step in, and I ask honorable members to join with me in passing the Bill. The measure is entirely in our hands, and I appeal to honorable members to pass it, and so help the establishment of the industry- It may be established with a comparatively small measure of encourage- ment. The Bill, as it stands, is very fair, and although some amendment of the schedule may be necessary in order to make it clear, that is a matter which may be dealt with in Committee. I appeal to honorable members not to view this question from any party stand-point- -not to say that because some of them have been free-traders in the past, they are free-traders still, and therefore must oppose this measure. I appeal to them to remember what a vast industry this will be; to remember the extent of our resources, the number of men who want employment, and the capitalists who are ready to invest money in the undertaking. I call upon them to bear in mind that the Government may, at any time, resume control of the industry, and, remembering all these facts, I cannot understand why any honorable member should say that he is not going to agree to ,the spending of the money of the country in this way - that he favours the sending of our money across the seas to give employment to the people of other countries, rather than to find employment for our own.







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