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Wednesday, 19 October 1904

Mr SPEAKER - Interjections which are short and of rare occurrence are not objected to, but interjections which are frequently made, and are of such length as to interrupt a speaker, cannot be allowed.

Sir JOHN FORREST - We are called upon to decide whether we shall exercise the powers granted to us under the Constitution, or whether we shall altogether disregard our great obligations, and stand before the country as merely an additional legislating machine, for the purpose of passing laws of general application which are not intended to exert a direct, influence upon our producing interests. The honorable member for Barrier said he would favour the granting of bonuses if the iron industry were placed under State control, but that otherwise he would rather see the mineral wealth of the country lie dormant. I altogether disagree with that attitude. Apparently if the honorable member cannot secure the establishment of the industry in the particular way he desires, he . would rather not have it at all. If we were guided by the same principle in the affairs of daily life we should meet with general condemnation. If we cannot secure the object we have in view in the way that seems to us best, we should be content to attain it by other means. The honorable member for Northern Melbourne stated that the iron industry must be a monopoly, but I do not know that that necessarily follows. There is nothing in the Bill to indicate that only one company shall take advantage of its provisions. In fact,. I hope .that the iron industry will be carried on in several of the States which possess enormous deposits of iron. Before we agree to this Bill, we are called upon to satisfy ourselves upon several points. The first of these is whether there is abundance of iron ore in Australia. I think it is generally admitted that this question can fairly be answered in the affirmative. The second question is, " Is the industry a desirable one to encourage ?" It is undoubtedly very desirable that the parent industry of iron manufacture should be carried on in our midst. In the third place, we have to ask ourselves whether, in the event of the industry being assisted in the manner proposed, it can be maintained in working order as a commercial undertaking without further help from the State. I am not in a position, personally, to answer that question. The matter is one upon which I must take the opinion of others, Those who are competent to judge affirm that the industry can be established upon a firm basis, and they are willing to support their opinion by a large expenditure of their own money. All . these questions have been investigated, and have been satisfactorily answered by the Barton and Deakin Governments, and by the Iron Bonus Commission. The total amount proposed to be offered in the shape of bonuses is £324,000. Of this amount, £250,000 is to be offered for the production of pig iron, puddle bar iron, and steel, produced from Australian ores. £20,000 is to be offered for the production of spelter from Australian ore, £50,000 for the production of galvanized iron, wire netting, and iron or steel tubes or pipes, and £4,000 for the manufacture of reapers and binders, at the rate of £8 each for the first 500. £324,000 may seem, at first sight, to be a large sum, but it represents a sum of only about £16,000 per annum at 5 per cent. - allowing 1 per cent, for a sinking fund - for fifty years, at the end of which time the whole amount would be paid off. The question for us to consider is whether >t would pay the Commonwealth to devote that amount of money to the establishment of the iron 1 industry. I think it would. It would be a very poor industry indeed if it did not prove to be worth that much to the people of Australia. I look upon this proposal from a purely business standpoint. If we establish the iron industry we shall provide employment for our people. The honorable member for Werriwa stated that only 400 persons would find employment, but it is absurd to suppose that that number of hands could perform all the work connected with such a large industry. Operations would have to be conducted upon a comprehensive scale, and the number of persons who would be directly and indirectly employed in winning the ore and in reducing it down to a marketable commodity, would be very large indeed. Then, again, if we manufactured iron from our native ores, we should become a much more selfcontained community than at present. Instead of having to import all our pig iron and other iron, and all that we require in manufactures of metal, we should in time be able to supply our own requirements in that regard, and we might also in time become exporters. I have taken the trouble to refer to the speech that was delivered by the right honorable member for Adelaide on the 27th of May, 1902. I have accepted his statements as accurate, because I have not the slightest doubt that, as Minister in charge of the Bill, he would take the greatest care to assure himself that the facts were accurately placed before him. He stated that, in 1901, 155,259 tons of raw material principally in the form of pig iron, valued at £1,117,430, were imported into the Commonwealth. We should make a very good start if we could produce that quantity of iron to meet our own requirements. During the same year our imports of manufactures of metals were valued at £6,800,000. Of course, for many years, we should not be able to manufacture anything like all the goods of that kind required by us, but there are undoubtedly immense possibilities before us in connexion with the development of our iron resources. We must remember also that, before the bonus of £250,000 can be claimed, those who engaged in the manufacture of iron, and who desired to claim the bonus, must spend about £500,000 upon buildings and plant. The right honorable member for Adelaide stated that it was estimated by some persons that £1,000,000 would have to be spent, and byothers, that £750,000 would have to be embarked in the enterprise. But he wished tobe on the safe side, and adopted an estimate of £50°>°°o-

Mr Lonsdale - Would they be required by law to expend that amount ?

Sir JOHN FORREST - I understand that they could not produce iron without spending that amount of money in buildings and plant.

Mr Lonsdale - Mr. Sandford, of Eskbank, says that £125,000 would be sufficient.

Sir JOHN FORREST - I derive my information from the speech of the right honorable member for Adelaide. The company, or companies, who entered upon the manufacture of iron would have to produce finished and marketable iron, valued at £[1,300,000, or steel valued at £2,000,000, before they could claim the £250,000 bonus. Therefore, it appears to me, that they will have to give the strongest proof of their bona fides before they can claim one penny of the bonus. No better security could be offered to the State. No one who did not intend to embark in the industry with a view to establishing it upon a firm basis would be induced to make such a large outlay. I have no doubt that it would be possible to arrange with the States Governments for the purchase from the local manufacturers of a very large proportion of their requirements in the way of manufactured iron, at prices, not more, and perhaps less than "those which they are now paying. I believe that the States Governments would, for instance, be willing to enter into an engagement to purchase so many thousands tons of steel rails, within a certain time after the iron works were in full swing. That would be a good thing for the contractors, and also for the States. However, that is a matter upon which an agreement could be made under regulations. I am quite certain that a great deal could be accomplished in that direction. I confess that I am surprised at some of the arguments which have been advanced to-night, because they all seem to be based upon what I regard as a fiscal fetish. From the views expressed by some honorable members, one would imagine that fiscalism was like the law given to Moses upon Mount Sinai, and that there was no room for a difference of opinion in regard to it.

Mr Conroy - Nor is there amongst educated men.

Sir JOHN FORREST - I suppose that the honorable and learned member includes himself in that category?

Mr Conroy - I shouldthink so. I did not spend years in studying the question without becoming educated.

Sir JOHN FORREST - Greater men than the honorable and learned member have entertained entirely different views.

Mr Conroy - I do not know them.

Sir JOHN FORREST - That fact does not prove anything. I am surprised to learn that some honorable members believe there is no room for a difference of opinion upon the fiscal question. It seems to me that if they cannot obtain a thing which in itself is good - I refer to the establishment of the iron industry - in the particular way that they desire, they will not have it at all. For many years we have been longing for the establishment of that industry, and it is not yet started. As reasonable individuals, have we not pursued a waiting policy long enough? If that policy has been productive of no result, is it not time that we devised some other plan to gain our ends? We are all agreed as to what we require, and we differ only as to the method of attaining it. In regard to the iron industry, we occupy the same position now as we did when this country was only occupied by the aborigines and by kangaroos and dingoes. Surely now that we enjoy a uniform Tariff, and possess the power to grant bounties, we should not continue inactive simply because of the fiscal views which we may entertain? In this House there are advocates both of free-trade and protection ; but to my knowledge no honorable member who is a free-trader has ever suggested that the locally produced article should bear an excise duty equal to the Customs duty levied upon the imported article, which is the basis of the free-trade doctrine.

Mr Conroy - I advocated the adoption of . that course in regard to matches.

Sir JOHN FORREST - I should like the honorable and learned member to again advocate it. because the ordinary free-trader in this House and throughout the country scouts the idea. If the proposal to grant a bonus were a new idea in Australia, there might be some reason for taking exception to it. But Ihave been accustomed to the bonus system ever since I had anything to do with politics. In Western Australia we have a small population, and a large territory to develop. Consequently, we gave bonuses in all directions, with a view of promoting and assisting the industries of the country. I cannot recollect how many were given to promote copper and lead mining. Then again, others were granted to encourage coal-mining and prospecting for gold. Bonuses were also paid for the erection of tin smelters, and land was given to encourage the construction of railways. All sorts of inducements were offered to persons to develop the timber industry, and cash bonuses were granted to encourage deep sinking in mines, and boring for gold and other minerals. Similarly we gave subsidies to steam services all along the coast - subsidies which are still being paid.

Mr Robinson - The Western Australian Government has no power to grant such subsidies now. It is unconstitutional to do so.

Sir JOHN FORREST - The steam-ship subsidies are granted ostensibly for the carriage of mails ; but the Government pays a large sum to'provide means of communication between the coastal settlements and the capital. Then again, bonuses were offered for the discovery of gold and other minerals, and for assisting immigration. When we pay the passages of persons from the old country, and give them free grants of land to induce them to settle in our midst, is that not a bonus ? Yet that practice has been followed in Australia for many years. Of course, where there is no necessity to encourage capital to develop the natural resources of the country, it is quite right that no bonus should be paid. But, if we reverse the position, we must use the power of the State. I have frequently heard the Prime Minister declare that the power of the State must be used to the utmost to develop the resources of the country. My only fear is that the bonus proposed is not sufficiently large when we consider the magnitude of the work to be undertaken. When we consider that the persons who establish the iron industry will require to invest, perhaps. £1,000,000 in the enterprise before they can gain this bonus, it cannot be urged that it represents a very large sum. I claim that if we can secure the permanent establishment of the iron industry by an expenditure of £250,000. that outlay will be amply justified.

Mr Webster - How will that fit in with

Mr. Chamberlain'sproposal?

Sir JOHN FORREST - In my opinion, there is no force in that interjection. Nobody in England expects Australia to benefit the mother country by injuring herself, and consequently I must conclude that the honorable member's interjection is prompted by some ulterior motive, rather than by a desire for information. I understood the honorable member for Barrier to say that though he intended to vote for the second reading of the Bill, if the industry is not to be controlled by the State he would prefer that it should not be established ?

Mr Thomas - Yes.

Sir JOHN FORREST - Then the honorable member would leave things as they are? Having this great opportunity, he would refuse to take advantage of it.

Mr Thomas - Private enterprise would still be at liberty to establish the industry if it chose.

Sir JOHN FORREST - There is a goal which we all desire to attain. Therefore, we must not remain content with existing conditions;' we must push boldly forward. This afternoon I heard opinions expressed which are more than usually opposed to the views I entertain. I would rather make the attempt to establish this industry and progress a little upon the road than make no attempt at all.

Mr Thomas - The right honorable member is a Socialist.

Sir JOHN FORREST - Those who urge that they will do nothing to secure the establishment of the iron industry unless it be established in accordance with their own fixed convictions, are not the persons to make Australia a great country. If the pioneers had followed a similar course, and if the State had not granted assistance to industries, Australia would not occupy the position that she does to-day.

Mr Poynton - The right honorable member is a State Socialist.

Sir JOHN FORREST - I do not see any State Socialism in the matter. It might as well be said that it is State Socialism for the Government to construct a railway. The State Socialism I would advocate is not the State Socialism Avhich honorable members opposite would advocate.

Mr Webster - The right honorable member would go further than I would in some respects.

Sir JOHN FORREST - I should endeavour to make two blades of grass grow where only one grew before, and to develop the natural resources of the country.

Mr Lonsdale - Why give £324,000 to other persons?

Sir JOHN FORREST - The honorable member seems to think a great deal of £324,000 ; but the question is, whether it will pay Australia to give this amount to establish a new and great industry. If we could obtain millions by the expenditure of £324,000, we should not be afraid to undertake the investment.

Mr Conroy - Nor would any one else.

Sir JOHN FORREST - But honorable members opposite would sit down and do nothing. I have had to do with this class of honorable member before - do-nothing croakers - who see no good in any proposal of this kind. They would rather see the country at a stand-still, and half ruined, than abandon their fetish. Those who will not go forward in the development of the country, must lag behind ; but they cannot expect us to stay with them. We have only one object in view, and that is-

Mr Lonsdale - To help the capitalists.

Sir JOHN FORREST - Our object is to develop the natural resources of the country, and by that means build up new industries, and provide new employment and new wealth for the people. I hope that the narrow-minded viewswe have heard this afternoon will receive short shrift when we come to vote on the measure ; if not, we may well despair of getting any good work out of this Parliament. Power is given to us by the Constitution to assist the industries of Australia ; I hope we will use that power to the fullest extent ; and I believe that if it is wisely used, it will be the means of doing an immense amount of good.

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