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Thursday, 19 December 1912

Senator ST LEDGER (Queensland) . -So far as I can gather, there is in Sydney a company which is particularly interested in the manufacture of wool tops. It appears that it has issued a prospectus inviting further capital, and, no doubt, in that invitation to the public, it pointed to our Bounties Act. The prospectus shows that, on some portions of its industry, the company was making10 per cent. before it came here, and, to judge by an interjection which was made afterwards, the company which earned10 per cent. some time ago has announced that it has made only 6 per cent. Senator Stewart has had the audacity to stand up here and say that 6 per cent. profit offered on a prospectus is a remarkably poor thing.I wonder if he has any elementary knowledge of finance or mathematics. Why, 6 per cent. returned as a dividend will, if put out at compound interest, mean the duplication of the capital in about ten years. There is not an investment, apart from a speculation, which can show that result.

Sitting suspended from 6.30 to8 p.m.

Senator ST LEDGER -It appears that the bulk of the money which under this Bill will be paid in the shape of bounties is to be paid to Hughes Limited, of Sydney. It has been stated that this company has made a10 per cent. profit on its general business, and has issued a prospectus in which it guarantees intending shareholders a dividend of 6 per cent. per annum. A sum of money put out at com pound interest at 6 per cent. will double itself in thirteen years. Could any one ask for a better investment than that? For a company that is in a position to guarantee a dividend of 6 per cent. to ask for State assistance in this way is a piece of hard, cold-steel cheek. There is only one thing worse, and that is the " Simple Simon " Government, that asks the taxpayers of Australia to come to the assistance of such a company. Senator Millen is to be congratulated upon his courage in attacking this measure, because it proposes assistance to a company established in Sydney, whose operations are probably confined to New South Wales. It may be assumed that the money, if granted, would benefit electors of the State, and, therefore, opposition to the proposal might very well excite local criticism. I warn the Government against this kind of thing. Where is it going to end?

Senatorde Largie. -No one has ever been able to make anything out of wool tops in the past.

Senator ST LEDGER - If that be so, of what use is it to continue the payment of this bounty? If this company can guarantee a dividend of 6 per cent., it does not need the bounty. We can get no definite information as to the capital invested in the company, or its profits. It occurs to me that, about six years ago, when this matter of bounties first came up, I ventured the prediction that the whole thing would be more or less of a fiasco.

Senator Findley -Every Free Trader is against the protection of industries.

Senator ST LEDGER -I do not care two straws about that. I do not happen to be a Free Trader.

Senatorde Largie. - It is the common declaration of Free Traders that they prefer bounties to protective duties.

Senator ST LEDGER -If a good return can be shown from the payment of bounties, I know of no reason why they should not be assented to. When we are being asked to extend the system, we should be informed as to the whole position. It is evident that the bulk of the money which will be paid under this Bill is to go to a particular company that is on the market, and is relying upon this assistance from the Government. The persons controlling that company should be able to say whether they are likely to extend their operations, and in what way they propose to benefit the taxpayers of the Commonwealth, who must foot the bill. Whilst official reports and returns of various kinds supply information as to wages, hours, and conditions of labour in various industries assisted by bounties, I can find none that gives a single definite piece of information as to the condition of an assisted industry, or as to whether its prospects are hopeful or distressing.

Senator Chataway - It is not unreasonable that we should ask for the same information as that upon which Mr. Tudor insists on getting from manufacturers who ask for increased Tariff duties.

Senator ST LEDGER - I thank my honorable friend for that reminder. Before the Minister of Trade and Customs would entertain a proposal even to rectify Tariff anomalies, he sent out a list of inquisitorial questions, and demanded that manufacturers should answer them. I should like to know whether the Minister of Trade and Customs has received any information from Hughes Limited as to the capital invested in the business and the profits earned on that capital. I am not against State aid to industries by bounties or protective duties, although I am called a Free Trader. I have never been a Free Trader, but I do not believe in high duties and miscellaneous bounties. If a reasonable case can be made out for temporary assistance to an Australian industry, I am ready to consider it. Honorable senators from Queensland might very well ask why it is not proposed to subsidize the cotton industry. Queensland produces cotton equal to any produced elsewhere, but I find no proposal made to assist the cotton industry in this way.

Senator Story - Because the representatives of the State have not looked after its interests.

Senator ST LEDGER - That is a serious reflection upon members of the Labour party who have represented, or misrepresented, Queensland since the beginning of Federation. Senator Chataway has pointed out that this clause affects the schedule to the Bill, and should be postponed until after we have considered the schedule. If we compare the other articles mentioned in the schedule, we are justified in calling upon the Minister for a reason why wool tops should be the curled darling of the Government on this occasion. We are justified in asking why the industry wants assistance; who are the poor struggling philanthropists who need it ; and what profits are being made ? I am against the whole thing till I get fuller information.

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