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Tuesday, 18 October 1904

Mr RONALD (Southern Melbourne) - I sincerely hope that the proposal which has been brought forward bv the honorable member for Eden-Monaro, will receive the very careful consideration ' of the House, and that honorable members will realize the advisability of establishing the iron industry in Australia as speedily as possible. When the matter was previously before the House, I took the liberty to break away from my party and to oppose the proposal to make the iron industry a State monopoly. I did so for what I considered to be a good reason, believing that the proposal thus made was simply another way of indefinitely delaying the establishment of the industry.

Mr McDonald - Rubbish j the honorable member has no reason to attribute such motives to other honorable members.

Mr RONALD - I admit that the honorable member is a great authority on rubbish, but I am not. It was patent that no State would take up the industry. I ventured to prophesy so much at the time, and it has been fulfilled. The amendmentthen made was merely a free-trade attempt to stifle the creation of a native industry.

The free-traders of New South Wales were unfavorable to the establishment of the iron industry within their State, and this was their method of postponing it indefinitely. We are urgently in need of the iron industry in Australia, because it has been well said that iron is the vertebra, or backbone, of all industries. The thing which has made America the great manufacturing country she is to-day "is her iron industry; and we know perfectly well that no country has ever attained to prominence as a manufacturing country, where the iron industry has not been a success. Iron has been well described as being more useful than gold. Undoubtedly, it is on account of the innumerable things for which it is used. The value of iron cannot well be over-estimated. So far as I am concerned, I see no difficulty at all in regard to the establishment of the industry, nor do I see grounds for any of the fears and the evils which have been prognosticated by the honorable and learned member for Werriwa. All we have to do to protect the workers is to insert a minimum wage clause in the conditions under which we grant the bonuses, and that will lead to a proper distribution of the money.

Mr Conroy - I doubled the wages paid in America, and that left only 6s. 8d.

Mr RONALD - We will quadruple them, if doubling is not sufficient. It is simply a matter of insisting upon a minimum wage clause being inserted in the conditions. That will lead to a fair distribution of the money granted by Parliament. But the great point that is made is that the bonus system has been tried, and, to some extent, found wanting in this country. The system has been found wanting, because the conditions imposed have not been sufficiently severe. In this case, it is proposed to pay by results - no iron, no bonus. That system will prevent the national exchequer from being exploited by any firm. Until they produce a certain quantity of pig iron they will receive no payment from the Government. When the proper quantity l£ iron is produced, the Government nill be in a position to -pay them. Thus there will be no danger of the national exchequer being exploited for the benefit of private employers. I would also point out emphatically that at the present time our pig-iron industry in Australia is in a very bad way. Honorable members are aware that what is known as scrap iron, if worked up over and over again, becomes at last almost useless ; and that is the state in which we find our selves. At the rolling mills in my own electorate, scrap iron is worked up over and over again. Consequently, iron may be used in machinery when it is dangerous to use it. That time must arrive sooner or later. Therefore, we require - if one may use the term - new blood for the iron industry. We require new pig iron to add strength to the industries in which iron is used. Hence the urgency of this proposal. So long as we are dependent upon America for the bulk of our iron, we shall be continually obliged to work up our scrap iron, and to over-work it. But when we have native iron employed, there will be a continual supply of fresh pig iron. I sincerely hope that we shall not go on wrangling in regard to the creation of this great industry. It is time that something definite was done. Some honorable members believe in making the industry a State monopoly. But all that can be secured by means of a State monopoly, in connexion with the iron industry, can be secured through private ownership. I should be favorable to granting a lease of from twenty to thirty years to the capitalists who embarked upon the industry. I should be prepared to treat them liberally. Though I am as staunch a State Socialist as any man, I am prepared to admit that the State in the initial stages of any enterprise does everything at a maximum of expenditure with a minimum of utility. But let us employ private capital in order to initiate this industry. Then we can step in with advantage, and conduct the industry by means of the agency of the State. It can be understood that in the initial stages of such an enterprise, great difficulties will attach to working it by means of the State. But if the industry is started by private enterprise, those who engage Tn it will know that they will have only a limited time in which to make their profits, and, with due regard to the utilitarian aspect, commence in the most economical way. At the expiration of their term, the works become the property of the State, just as the tramways in Melbourne, and elsewhere, become the property of the municipalities at the end of a given period. I believe- that people would be prepared to start the industry on these terms ; but, of course, there must be rigid labour conditions. The urgency of a measure of this kind is manifest. We have no iron shipping, or armament, and on an island continent where, at some time, though, I hope, it may be far distant, we may have to be on the defensive, we would soon realize the advantage of having the raw material within our borders. If we wait until the States choose to take the initiative, we shall wait until the day after doomsday. And, again, would it be fair to tax all the States for the sake of the State in which it is admitted the great mass of our iron deposits are to be found? Such a course would raise the old cry of State jealousy, which we are trying ,to stifle in this House. My opinion is that, in the initial stages, this industry would be better in private hands if proper safeguards are provided. There must be proper labour conditions, and payment by results; and, with these, there could be no danger of exploitation of the public purse. No doubt, there have been great scandals . in connexion with bonuses. The butter bonus, and the beetsugar tonus, were failures, and why? It was for want of what is known as State Socialism rigidly applied - for want of strict State supervision. But we learn by past experience, and I am quite sure that if we have a minimum wage, an eight hours' day, sanitary conditions in the works, and payment by results, no men will be able to use the bonus for their personal aggrandizement. If a State is prepared to take up the industry, I am in favour of a State monopoly; but I should like to know what the price is to be. In the electorate which I represent, there are a. large number of occupations in which iron is an incidental or an essential, and a bonus would impart new life to them. Industries are at the present time in a very low state in Australia. We are fast reaching the point when we shall be mere hewers of wood, and drawers of water - workers on farms and stations. If this country is to be made great, it must be by manufactures. America is our great exemplar ; and had it not. been for manufactures and protection, that country would not be the hive of industry it now is. . I should be quite prepared to impose a duty of 25 per cent, in favour of the iron industry, but it is an absurdity to protect what does not exist. I sincerely hope the question will receive the earnest consideration of honorable members, who will take care not to lose the substance for the shadow. We ought to at once grant a bonus to any firm, or company, prepared to produce the article under such conditions as I have indicated. I have reason to believe that my constituents are with me in the belief that this industry is urgently needed. I hope that the Labour Party, with which I am associated, will see how much the solution of the labour problem depends on this question, and will recognise that we have full power to prevent any exploitation of the public purse by private' individuals. The proposal that the States should take the initiative was only a subterfuge to enable the matter to be shelved. I havealready stated that honorable members who voted for a State monopoly do not believe in a bonus.

Mr Tudor - I do.

Mr RONALD - I am not speaking of individuals. The proposal was a free-trade move to cause indefinite delay.

Mr McDonald - The honorable member himself voted to remit the question to a Select Committee.

Mr RONALD - I voted against a State monopoly and for an inquiry in order to prove, as the report of the Commission does, that the matter ought to be left to private enterprise. I am in favour of State monopoly, though I am not anxious, by taking a short cut, to spoil the whole thing. Private enterprise has exploited labour long enough.

Mr McDonald - And the honorable member would give further power to private companies?

Mr RONALD - Let us now exploit private enterprise, by allowing it to take the initial steps, and when the works are a paying and going concern, let us take them o\'er.

Mr McDonald - The honorable member must think that people are " flats."

Mr RONALD - Those who started the enterprise would have had an opportunity to make it pay then.

Mr Conroy - What competition woulJ there be when 120 men can make all the iron required in the Commonwealth?

Mr McDonald - The honorable member for Southern Melbourne is prepared to give a monopoly?

Mr RONALD - Certainly not. I would grant a bonus to every firm who produced iron. We may. be quite sure that there will be plenty of competition.

Mr McDonald - One modern blast furnace would supply all the iron we require.

Mr RONALD - It would for a limited period ; but the industry would create its own demand. I do not think that one modern blast furnace would supply all we require, when we consider that we are without bridges or iron steam-ships, or any iron except scrap, which is used over and over again. The day will come when Australia will be a hive of industry, and iron mills will be found all over the country.

Mr Spence - In another thousand years !

Mr McDonald - That is the sort of thing we read about !

Mr RONALD - I am speaking from experience. My native country, Scotland, h one of the poorest I was ever in, and yet, owing to its great iron deposits, it is perhaps the best manufacturing country in the world.

Mr McDonald - But what are the conditions of the people?

Mr RONALD - That has nothing to do with the output, or the activities of the people. The conditions of the people are not good, owing to the free-trade system. If there had been protection in the old country wages could have been kept up.

Mr Johnson - Then, why are wages not kept up in continental countries, where there is so much protection ?

Mr McDonald - What are the conditions of the workers in Germany ?

Mr RONALD - In Germany protection is one-sided and conservative. In that country protection is for the capitalist, pure and simple ; there never has been any attempt at industrial legislation. There must be conciliation and arbitration combined with protection.

Mr Spence - Protection does not raise wages.

Mr RONALD - The honorable member ought to have known that long ago. Protection, plus conciliation and arbitration, does raise wages, and maintain them - one is the complement of the other. In Australia there is no danger from monopoly incidental to protection, because we have a system of conciliation and arbitration. A free-trade labour man, who believes in conciliation and arbitration, while opening the ports to competition, represents a flat contradiction in terms. The protectionist labour man, on the other hand, who believes in conciliation and arbitration, with reasonable protection for the employers, is at least logical, I have no hesitation in giving my earnest support to this proposal to grant a bonus to a private firm under the conditions I have named. If a private firm is prepared to accept a bonus on those conditions - payment by results - it will redound to the credit and profit of Australia, and go a long way to remove the chronic difficulty of the unemployed,

Mr McDonald - These statements are always made when a concession is wanted.

Mr RONALD - These are not statements, but convictions. If the honorable member has any capacity for reasoning from cause to effect, he will see that it is the inevitable sequence of creating an industry, which is the basis of .many others. Why should we linger in this matter ? Along the coast of Australia, in various places, we have immense tracts of the finest hematite iron. In New Guinea and New Caledonia, there is an immense tract of hematite iron, which is easily workable, and which, if necessary, could be shipped here. We have abundance of iron ore in Tasmania, New South Wales, and Northern Gippsland.

Mr McDonald - And in Queensland.

Mr RONALD - I am not sure about Queensland.

Mr McDonald - It has more than all the rest of Australia, so far as discovery has gone. - Mr. RONALD.- So much the.'better. All that is needed, is that an initial fillip be given in the form of a bonus or a duty. The bonus will, I believe, be very short-lived, because as soon as the industry is established we can resort to the time-honoured and tried method of protecting at the Customs House. I am strongly in favour of a bonus being granted to give an initial fillip to the iron industry, with the promise of a substantial protection as soon as it is called into existence.

Mr Johnson - The honorable member is not satisfied with a bonus, he wants protection as well.

Mr RONALD - I am going to protect the iron industry after it is created.

Mr Johnson - It is well to know that.

Mr RONALD - Surely the honorable member ought to know that we cannot protect what does not exist. To impose a duty of 20 per cent, on iron would be an absurdity, but to give a bonus at the start, and protection afterwards would create an iron industry which in its turn would create one hundred and one other industries, and go a long way to solve the unemployed problem. Mr. McDonald. - The honorable member proposes to give ,£324,000 to start these industries.

Mr RONALD - I am1 making no such proposal. I am willing to pay by results ; no iron, no bonus. I hope that the Bill will be earnestly considered, and that a doginthemanger policy will not be followed. My conviction from the first moment was that a State monopoly would only mean delay on the part of foreign traders, who do not wish the iron industry to be established in this country.

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