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Wednesday, 27 June 1906

Sir WILLIAM LYNE (Hume) (Minister of Trade and Customs) . - I am glad' that the principles of this Bill have received considerable attention from all parts of the House during the course of this debate. It would be idle for me, or for any one introducing such a measure, to say that it would not be possible to obtain some very useful information from debate such as we have had. In fact, the very object of threshing, out a measure of such great importance as this in debate is to elicit information. The superior and honorable member for Parkes referred to me to-night in a deliberately offensive manner. I know that it was deliberately done, but his remarks do not affect me in the slightest degree. The honorable member quoted parts of sentences from my speech, and left out parts which he should in honesty have quoted.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - Did I not read it proper! v ?

Sir WILLIAM LYNE - The honorable member left out, apparently purposely, portions of the speech, but having listened attentively to his observations, I cannot say that he threw any glow of light on the Bill. I cannot pick out from his criticisms any points worthy of reply, except the passages in which he expressed his desire to prevent competition in reference to our mail contracts, and to keep the open door for black fellows and blackfellows1 manufactures. But it is very evident to me, though the honorable member may deny it, that some few little .things which I had the temerity to say when introducing the Bill must have hit him fairly hard. He had very little to say in reply to the statements which I made. He tried to make a point on the question of what is dumping. He said that I did not explain what dumping was.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - I said that the lion 1 orable gentleman did not understand it.

Sir WILLIAM LYNE - I must be humbly permitted to say that I do not think the honorable member understands anything about the subject. If dumping were on 1 \ what the honorable member tries to make out that it is, why have Canada and many other countries taken such extreme action to prevent it?

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - Canada does not allow prohibition. She only allows increased duties.

Sir WILLIAM LYNE - The principle is exactly the same. I am going to quote from an authority to show what Canada has done, and the honorable member will see that, if Canada does not prohibit dumping, her Tariff practically permits the importation! of dumped goods to be stopped.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - There is a duty of only 15 per cent.

Sir WILLIAM LYNE - The principle is the same; it is done with the same view and for the same purpose. Will the honorable member say that there is no dumping when you can buy an article in America for £1 19s., whilst when that article comes to Australia it can be bought for 12s'. 6d. ? Is not that dumping?

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - There may be very good reasons for that.

Sir WILLIAM LYNE - I know that there are good reasons for it. There are similar reasons in connexion with iron and steel, and' all classes of goods which contain iron and steel, that are imported into this country. Steel rails which, if purchased in America, would cost ^5 12s. per ton, if purchased with a view to sending to Australia are sold at ^4 1.2s. per ton.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - Yet it does not follow that there is dumping.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - What is the honorable gentleman quoting from ?

Sir WILLIAM LYNE - I am quoting from an official report that was prepared at the instance of the late Mr. Seddon by his officers, in which these particulars are given as to the methods adopted in the United States of America in reference to goods dumped down on our shores. The result of this information was that Mr. Seddon brought in his legislation which expires next October, I think. He obtained this report with a view to substantiate the action which he was taking. The report enumerates about fourteen or fifteen articles as1 examples, giving the prices in America, and the prices charged if the goods are to be exported from America to other countries.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - It does not say that the price is less than the cost price to the manufacturers.

Sir WILLIAM LYNE - It does not matter whether the price is less than the cost price or not.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - That is the honorable gentleman's opinion.

Sir WILLIAM LYNE - It is, I venture to say, the opinion of every man of common sense, although I am not a great commercial authority, as the honorable member says he is.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Those facts may merely indicate abnormal values in the exporting country

Sir WILLIAM LYNE - They indicate nothing of the kind. This sort of thing is done mostly by trusts, because trusts can the more easily do it- This New Zealand document says. -

Perhaps the accusation against trusts that has most foundation is that they export goods to be sold abroad at lower rates than are charged for the same articles in the country of their production. This is sometimes faintly denied, but is more often boldly acknowledged and justified by the officials of the trust corporations.

In my speech in introducing the Bill, I quoted this list of articles, but I have now had the values turned from dollars into pounds, shillings, and pence, in order to show that when, these goods are dumped down on our shores they are sold for at least a third, and at times one-half, less than their price in America.

Mr Lonsdale - Does that indicate that thev are sold at less than cost price?

Sir WILLIAM LYNE - It does not matter whether they are sold at less than cost price or not. They are dumped down here, and they interfere with our trade. I am referring to this matter to show that this practice of dumping is regularly followed in the United States. When T previously spoke I referred to the total quantity of imports of iron and steel into Australia for the year 1905. That total amounted to £7,140,825. I said that a great portion of those imports came from the United States. At that time I thought that a larger proportion came from America than is really the case. I have since had the figures analyzed, and I find that, as far as we can judge, the country of origin of iron and steel to the value of £4,715,148 is the United Kingdom, though I am told that some portion of that comes here in the name of firms in the United Kingdom, though the iron and steel is really Belgian. Iron and steel to the value of £1,599,769 come from the United States. The imports of iron and steel from Belgium, Germany, and the United States combined amount to £2,421,406 out of the total quantity of £7,000,000 odd. This system of dumping is doing serious injury to our manufactures in Australia. That is the game that the foreign manufacturers of harvesters have been playing in this country

Mr Kelly - If the evidence isi so clear, why not wait for the report of the Tariff Commission ?

Sir WILLIAM LYNE - It is not a matter that is connected in any way with the Tariff Commission. I have information which shows that, though there are other combinations of a serious character outside the United States of America, they are not so serious as are the American combinations. But I have in this report a list of the corporations which have grown up in Great Britain with capitals of £8,000,000, £9,000,000, £6,000,000, £3.000.000, £7,000,000, £4,000,000, £8,000,000, £2,000,000, and so on.

Mr Lonsdale - Are they trusts?

Sir WILLIAM LYNE - All these separate corporations have grown up of late years, and they are a menace to Great Britain. It is stated in this report -

There is no active, political, or national feeling against the aggregation of British firms into powerful corporations. It is only lately that a distinct feeling of uneasiness as to the possible future of business ha.s arisen.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - Would the Minister name one of them which is a monopoly ?

Sir WILLIAM LYNE - I believe that some of them are very considerable monopolies. I do not wish to go into details on this subject to-night, but merely to show that not only in the United States, but in Germany, Canada, and other parts of the world there are strong financial trusts and monopolies which are controlling to a large extent the trade. I think the Steel Trust of America has 90 per cent, of the machinery trade of the world. We are taking time by the forelock. It has been admitted! by nearly every speaker that it is a very difficult thing - and this was the cause of the speech of the leader of the Labour Party - to cope with the trusts in the United States, which have been allowed to grow to such gigantic dimensions. Had the Congress in the early years of the Republic taken the course which we are now taking - I admit that we have the advantage of the example of what has taken place there - they would have been able to cope with the trusts, and prevent them from growing to the magnitude which, they have reached. They are a menace not only to American people, but also to all those with whom they trade. Here is a. little example of an American trust in connexion with the boot trade. I do not wish to mention any names, but I hold in my hand an original agreement, which any honorable member can see if he wishes. The trust send their machines and agent here. They bind nearly all the large bootmakers, who pay by the record of stitches, and under leases. They will not sell the machines, nor will they allow any other machines to be worked side by side with them. If the trade expands! to that extent, that new machinery must be got - the trust will not allow the bootmakers to get new machinery except from themselves. They reserve to themselves the right to supply all the new part of machines. There is an absolute prohibition against any one using a. machine, and against any one giving or selling a machine to the bootmakers. And if one condition of the agreement be infringed they have the power of recalling their machine at once.

Mr Lee - Can no one else purchase them ?

Sir WILLIAM LYNE - They will not allow that to be done. '

Mr Watkins - Do they only lease the machine ?

Sir WILLIAM LYNE - They only lease the machine, and even when it is worn out they will not sell it.

Mr Kelly - Is it a patented machine?

Sir WILLIAM LYNE - Of course it is. Here is a letter on the subject which

I received to-day in consequence of some statements which had been made in opposition to the Bill -

As an illustration, last year a shoe manufacturer in Melbourne put in one of our machines, which he worked alongside the American machines he had previously in his place. A month or so after he had a solicitor's letter demanding a return of the American company's machines.

Mr Henry Willis - What is the machine called?

Sir WILLIAM LYNE - I do not wish to mention the name of the machine.

Mr Lonsdale - -Why not?

Sir WILLIAM LYNE - I told the persons from whom I received the information that I would not give the names.

Mr Fuller - Then why give the information at all ?

Sir WILLIAM LYNE - Because I think it should be known what these trusts are doing in Sydney and Melbourne.

Mr Kelly - Why not name the trust?

Mr Tudor - Do not be drawn by the other side.

Sir WILLIAM LYNE - The Opposition are not going to draw me. They can look at the agreement in my hand, and if they do they will see that what I am saying is absolutely correct. They are prepared to sit down here quietly and allow this state of things to continue in our midst. If it were allowed to continue until the patent ran out we could not get a machine of any kind, because our local manufacturers cannot get a model of the machine as the Americans and Canadians can do in the case of our ploughs and harvesters.

Mr BRUCE SMITH (PARKES, NEW SOUTH WALES) - The same thing can be done under our patent laws.

Mr SPEAKER - Order. I would appeal to the sense of fair play in the House to allow the Minister to proceed. During the speech of the honorable member for Parkes there was an almost utter absence of interjections, and I ask honorable members to listen to the Minister as they listened to the honorable member for


Sir WILLIAM LYNE - No parts of these machines can be made in the Com monwealth. Unless we can get our own people to make the machines, which they cannot do under this terrible hide-bound agreement, that condition of things will continue for all time, or until the patent runs out. And that is a position which should not be tolerated. I wish, to read a few passages from the resolution which the Treasurer of Canada submitted when he was dealing with the question of dumping -

If at any time it shall appear to the satisfaction of the Governor in Council, on a report from the Minister of Customs, that the payment of the special duty herein provided for is being evaded by the shipment of goods on consignment without sale prior to such shipment, or otherwise, the Governor in Council may, in any case, or class of cases, authorize such action as is deemed necessary to collect on such goods or any of them the same special duty as if the goods had been sold to an importer in Canada prior totheir shipment to Canada.

That extract shows what was in his mind regarding dumping. There is another extract which I wish to read -

What we want is a high Tariff to exclude the manufacturers of the United States from this country. . In the county of Colchester we have a great iron industry, and the great complaint of the people connected with that industry is that $30,000,000 of manufactured iron comes into this country. We are prevented from building up our own industries, because honorable gentlemen opposite, while professing to protect them, are allowing $30,000,000 of iron goods to come into this country, and are offering these people a bonus.

That applies well to honorable members sitting opposite at the present time.

Mr Kelly - Does the Minister wish to keep out all American importations?

Sir WILLIAM LYNE - Not until we can manufacture all we need, and then I wish to ikeep out all American importations.


Mr Page - The Minister is "stonewalling " his own Bill.

Sir WILLIAM LYNE - I am not " stone-walling " the Bill, but I am replying to some statements which have been hurled at me. I sat here very quietly while a great many unworthy epithets were being hurled against me. One or two honorable members tried to make out that it was a terrible thing for the Minister to have the power to deal with such matters as may arise under the Bill. The honorable member for Parkes said that it provides that the Minister shall have such power. Even in its original form it did not contain that provision. It provided that the matter should be referred to a Board, that the Board should make a report, and that if it were to the effect that the matters had been improperly done, then, without any discretion at all, the Minister had to put the Customs Act in force. That was the position as the Bill came here originally. It is intended, however, that there shall be an alteration made in regard to the jury and the Board. A Judge will take the place of the Board, and give a judicial decision, which will be absolute, except that the Executive may, simultaneously if they like, modify or deal with the report.

Mr Page - Is it absolutely necessary that there should be a lawyer at the head of this inqury ? Is the Minister going to fatten the profession again?

Sir WILLIAM LYNE - I can assure the honorable member that it is difficult to get the person one wishes to fill a position of this kind. I believe that a Judge of the High Court would give general satisfaction.

Mr Kelly - The Judge will award a penalty as well as decide.

SirWILLIAM LYNE.- On the first occasion there will be no penalty inflicted, but the offender will be warned, and a certain injunction will take effect. It is only on the occasion of a second offence that the criminal part of the measure will be brought into force. There is another provision, which I cannot describe very well just now. There was great exception taken to the purchase of cheap goods in any part of the world in a special way, and bringing them here to compete with our own people in the sale of goods, or to affect the price of labour. There will be proposed an alteration, which will make the goods which come under that condition goods purchaseable from, or sent direct by the manufacturer, and cut out speculative purchases. The object of the alteration is to get the bed-rock manufacturing value, and if goods are brought in at below that point, then certain results will take place.

Mr Henry Willis - May they sell them bv auction ?

Sir WILLIAM LYNE - I do not know how they will sell them. If honorable members do not desire to hear this information now, I shall not give it; they will get it all in Committee to-morrow or the next day. I merely state these facts to show that my desire, as the representative of the Government, is to pass a measure that will prove beneficial. If it can be shown,in the beginning of the life of this measure, that it is harsh in its operations, the Government will be prepared to receive suggestions, though not suggestions that may result in the destruction of the Bill or in removing the body and leaving only the skeleton. There are other amendments proposed, though not of so important a character. The amendments which I have mentioned will, I think, afford some satisfaction, and remove a feeling of fear, which, in consequence of their not understanding how far the Bill would go, appeared to be in the minds of the deputation which waited upon me to-day. I think that the alterations I have indicated show very clearly the scope of the Bill, and that much hostile feeling will be removed when the measure emerges from Committee. As to some remarks which were made by the honorable and learned member foi "Parkes, I have here a case in point, which arose in one of the law Courts. A number of merchants, amongst whom were the appellants in this case, formed themselves into an association or combine, with the object of controlling the maize market. The members of that combine entered into an agreement whereby, in consideration of the combine being formed, they bound themselves severally to certain conditions. I wish to state that the agents for that combine were McArthur and Company, of Sydney. There was some dissatisfaction raised in connexion with the combine, and, in the course of the hearing of an action which resulted, the whole facts were disclosed.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Why mention only the one name ?

Question resolved in the affirmative.

Bill read a second time.

In Committee:

Clause i agreed to.

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