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Tuesday, 14 August 1906

Sir JOHN QUICK (Bendigo) .- Some time ago the Prime Minister, in referring to the report of the Tariff Commission with reference to spirits and the distillation question, expressed his gratification that the report was a unanimous one, being signed by all members of the Commission, and said he thought there would be very little difficulty in dealing with it at a single sitting.

Mr Deakin - Hear. hear.

Sir JOHN QUICK - The honorable and learned gentleman also said that he scarcely anticipated that the occasion would be availed of by the members of the Tariff Commission to fight the question over again. As a member of the Commission, I can give the Committee an assurance on behalf of my brother members and myself that we have no desire to thresh out this question any further than we have done.

Mr Fuller - Hear, hear.

Sir JOHN QUICK - We have done our duty to the best of our ability, and in the light of the information which we have gathered from all parts of Australia. We have heard all sides and every possible phase of this great and important question. Our conclusions are based, not upon any personal predeliction, sympathy, or tendency, but strictly upon the evidence- given on oath before us. They have been arrived at after very careful, thoughtful discussion and consideration, and we have done our very best. If they do not please the Minister or the Committee, or the1 country, we are very sorry, but we cannot help it. It is not my desire to occupy the time of the Committee to any extent in. appearing before it in the capacity of an advocate or pleader on behalf of the report of the Commission. That report speaks for itself, and I hope honorable members will not think that I or my honorable colleagues desire, whilst giving explanations of it, to appear in the character of partisans or advocates. We are quite prepared to listen to arguments or to offer explanations ; in the last resort, of course, the consideration and determination of details, depends upon the Committee. I should like to say, however, that it would be rather unsatisfactory to the members of the Commission who have been -investigating and considering this question for upwards of fifteen months if the conclusions which they have reduced to writing and submitted to Parliament were lightly or care- lessly thrown .aside in response to clamouring letters in the press, to clamouring deputations to the Minister, or to representations made to him, and, it may be, to other honorable members., by those who are not quite satisfied with some of the details of the report. It will not be satisfactory to us, and I do not think that justice will be done to the great cause, if honorable members allow themselves to be lightly or hastily influenced by letters in the press or communications addressed directly to them, or if our deliberations be disregarded in favour of suggestions made either by letter or in the course of an interview.

Mr Higgins - The letters in the press are often unsigned.

Sir JOHN QUICK - That is so. The members of the Commission are absolutely disinterested, but would like the Committee to do them the favour of considering their report and reading the evidence upon which it is based, before they denounce their work and reject it as useless. I was rather sorry to hear the Minister launch the debate this afternoon in such a light-hearted way, to hear the almost disparaging terms in which he referred to the report of the Commission, and to notice the way in which he seemed to brush aside some of its recommendations. No doubt those remarks would, to some extent, prejudice the case at the very outset ; but I point out to the Minister that he, at any rate, cannot claim to have given this subject, which is, to some extent, scientific and technical in many of its branches and phases, the same amount of consideration and thought that members of the Tariff Commission have given to it over a long period of time. None of their conclusions are hasty ; none, I think, can be regarded as conclusions based on anything like party considerations. As honorable members well know, these are the considered conclusions of both parties - both sides of the House - in fact, all round the House. The Labour Party and the Free-trade Party are both well and ably represented on the Commission, and I need not say anything in regard to the Protectionist Party. All classes and all sections of the House are represented, and every one has had a fair hearing; so that it would be very unfair to this great work if honorable members were to allow themselves to be deluded by fugitive correspondence and letters in the press. In this great question, as in all other great questions, there are several aspects to be considered. Many of these aspects are local ; there is a South Australian aspect, and also a Victorian and a New South Wales aspect.

Sir William Lyne - And there is a Joshua Brothers' aspect.

Sir JOHN QUICK - There is also a Commonwealth aspect.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - The Minister of Trade and Customs says that there is a Joshua Brothers' aspect.

Sir William Lyne - Messrs. Joshua Brothers have been communicating with us.

Sir JOHN QUICK - So far as the Tariff Commission is concerned, we have endeavoured to view everything from an Australian stand-point, and, so far as we could, to be fair, and do justice all round ; and it may be that there is complaint for the reason that we have not been able to please everybody. It is impossible to please everybody, and those who attempt to do so must fail. So far as Joshua Brothers are concerned, I do not think that they are satisfied, because Mr. Joshua was, I believe, the first to complain. I have seen him buzzing about the precincts of the House for a considerable time past, and I know that he has been writing letters on this subject ; indeed, from what I can hear, he is one of the most dissatisfied. At any rate, he sent letters to me expressing dissatisfaction ; and the fact that there is dissatisfaction all round may lead honorable members to the conclusion that there are many aspects to be considered, and that, after all, it is not what Messrs. Joshua or Mr. Penfold may think that has to be taken into account, but what this House thinks on the whole question, after giving due attention to all its phases. I do not propose at this stage to enter into the details of the scheme submitted, because I think that would be anticipating many stages through which we have vet to pass. But, with the permission of honorable members, I shall, at various stages of the discussion, say a few words on particular branches of the question. It would be of no use to cover the whole ground at the present stage, and to deal with a lot of technical matters which might be lost sight of when we come to consider the question in detail. But, before passing away from a few general observations. I should like to quote one or two letters I have received - I suppose other honorable members have also received them - giving a general idea of the position of the distilling industry in Australia in relation to the reports of the Tariff Commission. Messrs. Joshua Brothers, in a letter dated 7th July, say : -

The report, as a whole, is highly satisfactory to us, and we think also that it is of great satisfaction to Australian distillers generally. What we regard as flaws in it are quite subsidiary, but might, nevertheless, prove disastrous if allowed to go unchallenged. We desire to point out that our letter of 21st February, which you have been good enough to print as an appendix to the report, sets forth that our malt whisky and wine brandy have been distilled up to a maximum strength of 35 o.p. Spirits required to blend with these, in order to make the popular tasting liquors-, require to be distilled up to a higher strength.

That is the first letter they wrote, and it was written under a misconception. A few days ago Messrs. Joshua Brothers sent the following telegram : -

Misled fragmentary press reports your complete proposals now before us amply satisfied if passed in entirety, sole exception, clause allowing 75 per cent. molasses whisky, as pointed out our letter to you yesterday. Compliment you and members whole report. - Joshua Bros.

It may be that some of the dissatisfaction expressed in other quarters at the present time may be based on a similar misapprehension ; it may be that others have been misled by the fragmentary reports in the press. This may arise, perhaps, through no fault of the press, but owing to the piecemeal manner in which the report of the Tariff Commission was submitted to the House.

SirWilliam Lyne. - How could the report of the Tariff Commission be submitted in any other way ?

Sir JOHN QUICK - I was not suggesting that the report could have been submitted in any other way ; but my own opinion is that either the whole report ought to have been submitted to the House at the time, or that it should have been withheld.

Sir William Lyne - And every night honorable members clamouring for the report.

Sir JOHN QUICK - I am only referring to the result of the piecemeal manner in which the report was submitted. I know of no report of a Royal Commission having been similarly treated, namely, the body of the report separated from the recommendations - the body of the report submitted at one stage, and the recommendations submitted at another stage, and both afterwards forming two separate parliamentary documents. That was hardly fair to the Royal Commission, and no wonder misapprehension arose, as in the case of Messrs. Joshua Brothers, who admit that they were misled by the fragmentary manner in which the reports were circulated.

Mr Higgins - Did the Government receive the two parts together?

Sir JOHN QUICK - Most decidedly; the report and the recommendations were submitted in one document, signed at one time by the members of the Tariff Commission.

Mr Johnson - Then it was not the Tariff Commission, but the Government, who separated the documents ?

Sir JOHN QUICK - Most decidedly. Do honorable members think that the members of the Tariff Commission would be so unbusiness-like as to submit their report in two parts? The report was submitted as a whole. I am not making any particular complaint on this score, but pointing to the fact that misapprehension has arisen. I should now like to read a communication sent by Mr. H. A. Preston, of the Abbotsford Distillery, giving. , his opinion on the work of the Commission. Mr. Preston said -

I have the honour and pleasure of saying that the best thanks of the distillers and the general public are due to. you and the members of the Commission for your recommendations, and, if passed by Parliament, Australia will have the most scientific Tariff in the world with regard to spirits. Britain and France are both demanding such a one at the present time. It would have the threefold incidence of protection - against the world's cheap and inferior spirits - for the local distiller who wishes to make a good article, as against the one who may not ; and, lastly, for the consumers, in that they will know what they are getting, and have a better article cheapened to them by way of difference of duty. I particularly desire to emphasize the fact that neither whisky for blending purposes, pure malt whisky, nor grape brandy, should be distilled above 40 degrees overproof, and all distillation should be through pot-stills only. In conclusion, I trust that Parliament will see fit to indorse your recommendations by passing them into law as nearly intact as is possible.

Mr. Chas.P. Preston, of the Australian Distillery, South Melbourne, writes me a letter to similar effect substantially. I received another letter from Mr. Henry Brind, one of the oldest and most experienced distillers in Australia, of the Ballarat Distillery. In this letter, which is dated 16th July last, Mr. Brind says -

Your most arduous duties as Chairman of the Tariff Commission, having now been lightened, we feel it our duty to thank you and your brother Commissioners for your recommendations re the spirit industry, which we think to be most equitable and scientific alike for the people of the Commonwealth and the distillers, enabling the latter to make a pure, unadulterated article, and the public to know what they are buying. We sincerely hope that your report will be adopted without any amendment. We also thank you for your desire to have the measure brought before the House at an early date.

I also received a telegram on 8th August from Mr. Jas. Thornton, the president,' and Mr. John Ashton, the general secretary of the United Licensed Victuallers'

Association of New South Wales, as follows: -

This Association thoroughly indorses the recommendations of the Tarin Commission in regard to our trade.

The only discordant note in the correspondence I received was a communication from Mr. Cleland, the secretary of the South Australian Wine Growers'" Association, in which the following passage occurs : -

My association is of opinion that the term " brandy " should only be allowed to apply to spirits distilled exclusively from fermented grape juice, and that in view of the large and increasing proportion of brandy in use for medicinal purposes, its purity should be upheld and guaranteed by strict Government supervision.

That is the only communication by way of protest that I have received, apart from some references to small matters of detail, such as the degree of alcoholic strength of distillation. These matters of detail are fairly open to consideration. They are matters upon which, even members of the Commission have no very pronounced views. Whether distillation should be at an alcoholic strength of 35 per cent, or 45 per cent, over-proof is not a vital question, but it is vital that unless these spirits are distilled at a certain defined strength over-proof, they shall not receive the preference and advantages which we have recommended.

Mr Hutchison - Why did the Commission propose to let the distillers introduce 75 per cent, of spirit distilled from other material.

Sir JOHN QUICK - That is but one of the immense number of details involved in the scheme. I shall deal with it later on, but I am now giving an explanation of some of the ' leading points at issue. I should like to say that the 'general principle of the scheme of Excise duties on spirits recommended bv the Commission is that certain concessions and advantages should be granted to spirits of Australian origin, distilled under the supervision of the Excise authorities, and complying with certain Excise conditions. Apart from any question of free-trade or protection, the members of the Commission reasoned the matter out in this way : If we were to recommend Parliament to impose certain stringent conditions for the production of spirits, certain improvements in production by pot still, patent still, or other methods, a certain strength of production, a certain time for maturing, and the use of certain materials, we could fairly recommend

Parliament to grant concessions and advantages to the manufacturers who produced spirits in compliance with those conditions. That is the basic principle of the whole scheme. We therefore proposed a scheme of Excise duties upon spirits based upon the following principles of classification : - First, with respect to materials of origin, such as grape wine brandy, barley malt whisky, blended brandy, blended whisky, rum from molasses, gin from barley malt or other grain, and, finally, spirits, n.e.i. These ave the materials of origin indicated in the Commissions report, and with reference to them, it was felt that there might be, instead of a uniform Excise duty, a graduated duty, because it was. thought that a spirit produced from barley malt or grape wine at a cost of from 3s. to 4s. per gallon should not bear the same Excise duty as a cheap spirit produced at a cost of only is. per gallon. Hence the graduation of the duties recommended was based to a large extent upon the cost of production.

Mr Poynton - Then the Commission propose to allow distillers to add 75 per cent, to 25 percent, of grape wine spirit?

Sir JOHN QUICK - If honorable members desire to have anything like a clear statement from me, they had Letter not interrupt my speech. The material of origin was the first consideration, the second consideration was the method of distillation and- the initial alcoholic strength. The third was detention in bond for a specified period in order to secure age and maturity. The fourth was compliance with the directions of the excise officers and strict excise supervision, and, finally, the coping stone of the whole scheme was that no spirit should be entitled to the proposed differential advantages and concessions, unless they were certified by a Commonwealth analyst to comply with the conditions named, were good and true to name, and produced in accordance withthe regulations. Honorable members will see at a glance that, even though we may not have been successful, we, at any rate, endeavoured to base our scheme of classification on something like logical and reasonable grounds. We say in our report -

On these lines we recommend the adoption of the following duties of Excise on spirits :

Then follows the scheme, and as elaborated in detail in the report, it is substantially, although not quite expressed in the resolution now before the Committee. I have certainly been somewhat surprised, however, to find that the Minister, having considered our scheme, having practically adopted it, and having embodied it in the resolutions submitted to the House, should now, because of some cry he heard in South Australia, or some other place, wish to abandon his own resolution, arrived at, it is to be presumed, after some consideration, and to disorganize the whole scheme.

Sir William Lyne - No; I said when I submitted the resolutions that I put them in that form, because thev were submitted in that form bv the Tariff Commission.

Sir JOHN QUICK - I see. Then I must say that the honorable gentleman has hardly grasped- the scheme yet, and it might have been wise and prudent on his part to take a little more time to consider it before he came down to denounce it, and to say something so disparaging concerning it as to be calculated to destroy it. If the Minister begins in this way, in all probability the scheme might as well be thrown into the waste-paper basket, unless honorable members generally rise to the occasion, take the matter into their own hands, and work out the problem for themselves, apart from the Minister's advice. I ask honorable members to consider the first item -

Brandy, distilled wholly from grape wine by the pot-still or similar process at a strength not exceeding 35 per cent, overproof, matured by storage in wood for a period of not less than two years, and certified to by a Commonwealth analyst to be pure brandy - per gallon 10s. (4s. less than import).

That is now altered to ns.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - The certificate referred to would be equivalent to a standard?

Sir JOHN QUICK - What is meant is, that it is to be certified by a Commonwealth analyst to be true to name,- and true in respect of compliance with the 1 statutory provision. Everything in that item is based upon evidence given on oath before the Commission, and that is the best specification for the production of a true brandy that we were able to devise. It might be called a scientific stipulation as to the mode in which it is to be made in order to secure the preference of 4s. If the distillers comply with those conditions and requisites, they are to get that preference, but not otherwise. The next point is a blended brandy, and I believe it is in connexion with the blending that the whole controversy has arisen. I admit that on this question, there was a regular battle before the Commission between practically two great parties. One contended for a brandy which is to be composed of grape wine spirit exclusively - that is, without the introduction of any other kind of spirit - while the other party contended that whilst it was true that originally the true brandy was a spirit distilled from grape wine, in the course of time another kind known as the brandy of commerce came into use, and that the base of that brandy is grape wine spirit with which has been mixed a blending spirit composed of, or derived from, other material such as grain, potatoes, rice, or molasses. The whole contention is as to whether we are to recognise a blended brandy - the brandy of commerce - or as to whether there is to be a brandy known only as grape wine brandy.

Mr Kennedy - That is not the point of difference I think.

Sir JOHN QUICK - Yes; that is the material point. I know what the case of my South Australian friends is. I heard the whole case fought out, and I think) that I ought to understand something about it by this time. I had no preconceived . opinions upon this matter. I approached it with an open mind; and now that I have indicated the battle-ground, let us see what the evidence is, apart altogether from the letters which have appeared. The first piece of evidence to which I would invite the attention of honorable members is that of Mr. Saul Joshua, given at Melbourne on the 17th February, 1905.

Mr Poynton - He was an interested witness.

Sir JOHN QUICK - I shall quote the evidence given on both sides ofl the question. Mr. Saul Joshua gave the following evidence : - 876. Would you describe genuine brandy as a brandy made from a spirit distilled from grapes? - It is described in that way by some lexicographers; but as a fact there is very little brandy of that description in the world. I have before me the figures showing the production of France. 877. What would you describe as a good brandy fit for human consumption? - I should say a blended brandy, such as is understood in the trade as the brandy of commerce. 878. But have you not just told us that the brandy of commerce may mean a brandy which is the product of distillation from potatoes, beet,, and other things? - It could be. 879. What is the blend that you speak of a» a good, wholesome spirit? - Wine spirit with grain spirit, or malt spirit, or sugar spirit. Blended together, as made in France.

In reply to question 882 he gave figures - which were challenged at first, but which were confirmed afterwards as absolutely true - as to the production cf brandy in France. He gave statistics showing that in a period of eleven years, the average quantity of brandy produced from grape wine was 2,500,000 gallons, and yet. in lhat period, France, he went on to prove, purported to manufacture, consume, and export, 45,000,000 gallons, the obvious inference being that the 45,000,000 gallons of so-called brandy was a blended brandy, and could not possibly have been made exclusively from grape wine, because only 2,500,000 gallons of grape wine spirit were produced annually in all France. That is all the 'evidence I shall quote from Mr. Saul Joshua, as some honorable members seem to think that he is interested. T shall now quote from the evidence of Mr. Daniel Ferguson, a disinterested witness, who is Chief Inspector of Distilleries in Victoria, and a thorough expert. He did not take sides between the distillers. In reply to the honorable member for Perth, he gave the following evidence: - 2106. Is wine invariably used for the production of brandy? - They have first of all to use wine. 2107. Is any brandy made in Victoria from material other than wine? - The foundation of brandy is grape spirit, but other spirit may be added to it.

Mr Watson - Does the honorable and learned member call 25 per cent, of grape wine spirit the foundation of brandy?

Sir JOHN QUICK - Some of the witnesses think that that is a very fair foundation, but I would remind the honorable member that it is the minimum.

Mr Watson - It suggests the idea of a pyramid standing on its apex.

Sir JOHN QUICK - It could . be higher than 25 per cent., but that is the minimum. 2108. Why? - For reasons affecting the article, and to give the brandy a distinctive taste. The public do not like a pure grape brandy, because there is too much of the wine taste in it. Hence the distillers try to produce an article which will -suit the public taste. 2109. At one time, when people drank brandy, thev drank what was undoubtedly the product of the grape? - They may have done that years ago. 2110. Is the taste for grape brandy modified with other spirit a correct taste? - That is for «he public to decide. If I wanted brandy purely as a beverage, I would prefer that to which a little spirit had been added ; but if, I wanted it purely as a medicine, I would desire pure wine brandy.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - What does he mean bv the addition of a little spirit?

Sir JOHN QUICK - A little white, or highly-rectified, spirit. The next witness to whose evidence I invite attention in justification of this differentiation is Henry Duncan Brown, the Chief Distillery Officer in New South Wales, a very able and disinterested man. His evidence is as follows : - 18662. Do you think that the name " brandy " should be restricted to spirits produced from grape-wine, or grape materials? - There is a great difference of opinion on that subject. For my own part, T do not think that a mixture of pure grape-spirit - that is, brandy, as some wish it to be called - with silent spirit would be unwholesome. I doubt very much whether such a mixture would not be better for drinking purposes than is a pure grape brandy. 18663. Such a mixture might be wholesome, but it would not be brandy? - That is so. 18664. Should it not be called by its true name - a blend ? - Yes ; but the difficulty is that brandy can be imported without any restriction. 18665. Certainly, but the same system would have to be applied all round? - That is where the difficulty would arise. 18666. Could not such a provision be applied to the imported article? - No; for a reason that I shall explain. If a blend consisting of a pure grape spirit, and a silent were imported, an analyst would not be able to say what it contained. He would only find spirits derived from grape brandy. If an imported article consisted of a blending of potato spirit and pure grape spirit, and were labelled " Pure grape brandy," the analyst would not be able to detect the fraud.

He pointed out that, while true brandy is produced from grape wine, what is called a blended brandy has come into use, but he would confine the term brandy to brandy made from grape wine spirit, labelling the mixed spirit known as blended brandy in such a way that the public would be aware that in purchasing it they were buying, not true brandy, but a blend. I will quote another short passage from his evidence - 18994. Do you think it would be right to require that brandy shall not be mixed with alcohol derived from any other source than grape wine? - I do not see any objection to the blending of brandy with silent spirit, and calling it a commercial brandy. 18995. Do vo" see any objection to requiring such brandy to be labelled "blended brandy"? - I am decidedly in accord with that.

Mr Mahon - Perhaps some of the imported brandy is not made wholly of grape wine spirit?

Sir JOHN QUICK - The witness pointed out that a great deal of imported brandy may contain other than grape wine spirit, but that the presence of that other spirit could not be detected, and, therefore, imported blended brandy could masquerade as true brandy, whereas local brandy made under the supervision of the Excise officers could not contain any but grape wine spirit.

Mr Mahon - Therefore, the local article would be under a disadvantage.

Sir JOHN QUICK - Yes, unless a corresponding burden were placed on the imported article. The witness seemed to think that brandy produced from grape wine spirit should be exclusively entitled to the name, and that any compound should be termed blended brandy.

Mr Watson - Did any analytical chemist say that the proportion of rectified spirit in a brandy could not be distinguished ?

Sir JOHN QUICK - Mr. Wilkinson,the analytical chemist of Victoria, said that when spirit is rectified to a high degree it can not be distinguished.

Mr Watson - But spirit rectified to a high degree is not brandy.

Sir JOHN QUICK - There might be 25 per cent, of true brandy of a strength not exceeding 35 or 40 degrees., but the amount of silent spirit in addition to the grape spirit could not be detected. Mr. Charles C. Tucker, a Sydney merchant, who represented the Sydney Chamber of Commerce, and is a thoroughly competent man, gave this evidence - 19927. You have told us that you would not allow the word " brandy " to be applied to spirit other than that distilled from grape wine? - Yes. 19928. Would you allow the term " blended brandy " to be applied to a mixture of grape spirit and grain, or some other spirit? - Yes. I believe that in England they allow the term " blended brandy " to be used.

I ask the representatives of South Australia to note that I have now read the evidence on which the recommendation of the Commission was based. It shows that an article called blended brandy is known to commerce.

Mr Batchelor - The honorable and learned member promised to read the evidence given on the other side; but he has not done so.

Sir JOHN QUICK - I think that I have read enough to support my own case. Evidence was given in South Australia byMessrs. Cleland and Reid, who fought most strongly for the view that the term brandy should be confined exclusively to spirit obtained from grape wine, and that no consideration) whatever should be given to other spirit, under the name blended brandy, distilled partly from grape wine spirit, and partly from other materials. The Commission used the words "other materials," however, because we did not feel bound to restrict the makers of blended brandy to grape spirit and grape wine spirit. To do so would not be fair to our distillers, because it would restrict their choice of material, and prevent them from using barley, oats, rye, maize, beet, and other produce, the growers of which hope to profit by any increase in Australian distillation. The distillers claim the right to make their blends of such materials as they may see fit to use, instead of using only grape wine spirit distilled at a strength of 35 or 40 degrees overproof together with a highly rectified grape wine spirit. On the other hand, the South Australians - and it is to their honour and credit - have developed a first class brandy, which, I believe, is the best in Australia. I do them the justice of saying that.

Mr Poynton - And the proposed new duties will destroy their industry.

Sir JOHN QUICK - They will do them no harm whatever. The South Australian manufacturers of brandy have been carried away by panic - a panic which has been based upon ai misconception. In the same way, Messrs. Joshua Brothers were acting under a misapprehension. The South Australian manufacturers desire that the word "materials" shall be struck out, and the words, " other grape wine," or " other grape refuse," inserted. We could not comply with their request, because we could not see our way to limit the blenders of brandy to the use of grape wine spirit. If we had done so, we should have acted in absolute contradiction to the knowledge and experience of the whole world with respect to blended brandy. Although in ancient days brandy was understood to be made wholly of grape spirit, we have moved forward since then, and the public taste has undergone a modification. As is shown bv the evidence, a large section of the public do not like brandy made wholly of wine spirit, because of the wine t'aste imparted to it. They want brandy made partly of some other spirit. This mav be a vitiated taste, but the distillers say that' they have to cater for the public requirements and to study the public inclinations, and that they cannot be tied down to the manufacture of brandy out of wine spirit pure and simple.

Sir Langdon Bonython - In other words, they find it necessary to adulterate?

Sir JOHN QUICK - The use of the word " adulteration" is also founded upon a misapprehension. That term can be applied only when spirits are blended with the object of deceiving the public. In cases, however, where the spirit is honestly described, and the brandy is sold as blended brandy - in cases where, as we recommend, the description is affixed to the bottles and the packages - no one can 'be deceived, and it is wrong to apply the word "adulteration." I appeal to honorable members to say whether brandy sold under an honest description, and certified to by the Excise officers as having been distilled in a certain manner, and blended in a certain manner, can be called adulterated spirit. In such a case, the term adulteration is a misnomer. It is a purely hackneyed cry that has been raised to serve a certain purpose.

Mr Johnson - A spirit may be adulterated, notwithstanding that the bottle bears a description of the contents.

Sir JOHN QUICK - I contend that the spirit is not adulterated, if it is sold under am honest description. If a blended brandy is sold as pure grape wine brandy, there is deception; but if customers wish to buy a bottle of blended brandy, and the word " blend " appears on the bottle, no deception is practised upon them. The word " blend " is frequently used to indicate that the liquor is made up of spirits that are not of uniform character.

Mr Poynton - In many cases, the public will not know what is meant by the word "blend."

Sir JOHN QUICK - They will, because, if the recommendations of the Commission are carried out, each bottle will bear upon it a description of the materials of which the spirit is made. The whole of the objections to these proposals are due to an alarmist cry that has been raised in South Australia, and, if honorable member's would calmly consider the whole matter, they would not be so ready to condemn the recommendations of the Commission. We cannot fly in the face of the public taste, or preferences. The South Australian manufacturers complain of the pro posal that distillers should be permitted to apply the term " brandy " to any liquor that is blended with other than grape spirit, and it seems to me that that is a most unreasonable view to take. Blended brandies have been in existence in Australia, France, and Great Britain for years past, and we cannot fly in the face of custom and the public taste. In paragraph 2, honorable members will see that a definition of blended brandy is given. The whole of the objections that have been urged against the recommendation apply to the inclusion of the word "materials." If, however, that word were struck out, the whole virtue of the definition would be destroyed.

Mr Mahon - It might also inflict injury upon the farmers.

Sir JOHN QUICK - Exactly.

Mr Glynn - It would be more likely to injure the Colonial Sugar Company.

Sir JOHN QUICK - We propose to establish a standard for pure brandy, and a standard for blended brandy, and it is intended, in paragraphs 2, 3, 4, and 5, to extend certain exclusive rights, privileges, and advantages to those who comply with the conditions laid down. If the brandymakers of South Australia maintain their present high standard, and make brandy exclusively from grape wine spirit, they will have the sole right to describe it as pure Australian standard brandy. No other persons, unless they produce brandy of a similar character and composition, will be entitled to use that name. The makers of pure brandy will have a Commonwealth certificate to the effect that their spirit is of a certain standard, and no one else will be able to compete with them, unless their spirit possesses the necessary qualities. I contend that that is the most important protection.

Mr Batchelor - The South Australia brandy-makers are to go down in a blaze of glory.

Sir JOHN QUICK - Those who make blended brandy will not be permitted to call it the Australian standard brandy, but must describe it as blended brandy. I believe that, asa matter of fact, there is a greater demand for blended spirits than for high standard spirits, such as pure grape brandy. That may be regrettable, but it is a fact, and the distillers have to manufacture spirits that will sell. Coming now to the question of preference, honorable members will see that grape wine brandy is to have a preference of 4s. per gallon, whereas blended brandy will have a preference of 3s. per gallon. The preference of 3s. per gallon given to blended brandy is based upon a minimum percentage of 25 per cent, of pure grape wine spirit. That is to say, the blend shall consist of not less than 25 per cent, of pure grape wine spirit. But most manufacturers of the blended brandy will, in the course of practice, use more than 25 per cent, of pure grape wine spirit. Many will probably use 50 per cent., and some, perhaps, 75 per cent., of pure grape wine spirit.

Mr Batchelor - In other words, they will use the dearer article?

Sir JOHN QUICK - They may do so for the sake of producing a better blend of brandy. In all probability it will be to their interests to use more than 25 per cent, of pure grape wine spirit in producing their blend, in order that they may give it more body, more tone, and more quality, and thus make, upon the whole, a superior article. That is the reason why the Commission could not distinguish between fractions of a shilling. We could not say that a duty of a shilling should be split up in accordance with the proportionof pure grape wine spirit which is contained in any blended brandy. We could not say, for example, that 25 per cent, of pure grape wine spirit in a blended brandy should give the distiller an advantage of 3d. per proof gallon, that 50 per cent, should confer an advantage of 6d. per proof gallon, and that 75 per cent, should confer an advantage of9d. per proof gallon. We had to make allowance for the fact that in all probability the manufacturers of blended brandies would use at least 25 per cent, of pure grape wine spirit, and that others would require to use, perhaps, 50 or even 75 per cent, of that spirit.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Is it not as easy to specify 50 per cent, as it is to specify 25 per cent. ?

Sir JOHN QUICK - The Commission recommended that a blended brandy should contain not less than 25 per cent, of pure grape wine spirit. It is claimed that our proposal constitutes a preference to the blended article as against the pure article. I fail to see it. If anybody thinks he can make a better differentiation, I should like him to try. Of course, any persons can say. "Let us destroy the scheme," but my reply is, " Let them suggest something better." The members of the Commission have done their best. We could not favour the distillers in South Australia as 'against the distillers in other States.

Mr Batchelor - It is not a question of favouring South Australia.

Sir JOHN QUICK - There are distillers of blended brandy in other parts of Australia.

Mr Johnson - The whole proposal is in the interests of Messrs. Joshua Brothers. The whole thing was engineered by Mr.. Joshua from the beginning.

Sir JOHN QUICK - I am surprised at: the honorable member always jerking out assertions in reference to Messrs. Joshua; Brothers, as if they had "bossed" the Commission.

Mr Johnson - They are the only persons who will be benefited under these proposals.

Sir JOHN QUICK - The honorable member should recollect that the report of the Commission was signed by four freetraders as well as by four protectionists. It is high time that he dropped his allusions to Messrs. Joshua Brothers. The Commission had to consider the whole of Australia. In Western Australia some distillers intend to go in for the manufacture of a blended brandy. It may not be to their interests to use the lowest percentage of pure grape wine spirit - namely, 25 per cent. - in the production of that article. If the higher percentage of grape wine spirit be used, the preference will probably parr out at about 2s. 6d. instead of 3s. per gallon.

Mr Johnson - Is the honorable and learned member aware that Joshua Brothers have just ordered 10,000 gallons of white spirit from the Colonial Sugar Refining Company ?

Sir JOHN QUICK - I know nothing about the matter, except what has been given in evidence upon oath, and I do not. want to know. The honorable member can pry into the private affairs of that firm-

Mr Johnson - The information was supplied to me without any prying upon my part.

Sir JOHN QUICK - Perhaps it has been supplied by a rival in the trade. I am not dealing with trade rivals - I am endeavouring to do justice all round. The members of the Commission did their best to reconcile conflicting interests without doing injustice to anybody.

Mr Johnson - I am not reflecting upon the honorable and learned member.

Sir JOHN QUICK - I need not take up the time of honorable members by referring at length to the duties upon malt whisky, and upon blended whisky. The same principle which we adopted in reference to the duties upon brandy produced from pure grape wine spirit and upon blended brandy applies to the rates which we recommended should be levied upon malt whisky and upon blended whisky. The same principle of classification, differentiation and gradation, is applicable in each case.

Mr Mahon - Except that there is more whisky consumed, and that, therefore, if we omit the words " other materials, ' ' greater injury will be inflicted upon the farmers.

Sir JOHN QUICK - The honorable member reminds me of a complaint which is urged on behalf of the whisky distillers in regard to the blended article. The fourth proposal before the Committee reads -

Blended whisky, distilled partly from barley malt and partly from other materials, containing not less than 25 per cent, of pure barley malt spirit, &c.

I am told that the whisky distillers desire the word "materials" to be eliminated, with a view to inserting in lieu thereof the word "grain." They urge this alteration in order to exclude the possibility of a blended whisky being composed partly of barley malt spirit and partly of molasses spirit. In regard to that suggestion I am quite willing to keep an open mind. I am prepared to hear arguments from both sides. The Commission inserted the word' " materials "so as to make the proposal harmonize with the proposal which is contained in their second recommendation, thus giving the distillers discretionary power to produce a blend out of a basic spirit - in one case that spirit being pure grape wine spirit, and in the other a malt spirit - mixed with pure and highly rectified spirits made from other materials, subject to the veto of the Excise officer. If the latter found that the materials so used were injurious to the public, he could veto them. Some slight alteration has been suggested in regard to other matters, which I need' not occupy time in debating. I have merely put before the Committee sufficient material to launch the discussion, with a view to affording honorable members an opportunity of considering some of the leading points.

Mr Mahon - What is the explanation of the ninth proposal which levies a duty of 40s. per proof gallon upon spirits n.e.i. f

Sir JOHN QUICK - I cannot understand that proposal. There must be some explanation of it, but at present it is unfathomable to me. Before resuming my seat, I should like to say one or. two words upon the revenue aspect of this question. Honorable members will observe upon page 4 of the Commission's report, the following :-

We recommend- no change in existing rates of duty on imported spirit; but if the foregoing set of excise duties be adopted, we recommend that bulk spirit imported into the Commonwealth, and imported bulk spirit reduced and bottled in bond within the Commonwealth, shall be entitled to an allowance for under proof similar to the allowance of excise duty on spirits produced in Australia upon evidence being given to the satisfaction of the Minister that a period of at least two years has elapsed since the distillation of the same, provided no such allowance shall be made on any strength less than 16.5 under proof.

Upon a full consideration of the whole of these proposals, we arrived at the conclusion that whilst we were justified in recommending certain reductions in the Excise duties upon spirits, we could not - and we deliberately refused to do so - recommend any alteration in the import duty. We worked out a scheme designed to give certain advantages and concessions to the local manufacturer, but we desired that those advantages and concessions should be plainly and clearly expressed upon the statute-book, without any reservation or condition - without anything arising indirectly, and producing results which we did not anticipate or did not desire to express. We arrived at the conclusion that, provided that the conditions I have mentioned were complied with, grape wine brandy was entitled to a clear advantage of 4s. per gallon ; that blended brandy should have an advantage of 3s. per gallon; malt whisky, 4s. per gallon ; blended whisky, 3s. per gallon ; rum and gin, 2s. per gallon, and so forth. In arriving at this decision, we did not wish in any way to alter the existing import duty, nor to cause any disturbance in trade in regard to the ordinary wholesale or retail selling prices. Under the Commonwealth Tariff, during the last five or six years, there has been in operation an import duty of 14s. per gallon. That has led to certain selling rates in the Commonwealth, and it was thought that if there were an increase in the import duty it would disturb the existing selling rates, and, perhaps, to some extent, prejudicially affect the wholesale as well as the retail trade. We intended no such disturbance; we intended to give a certain clear positive advantage without upsetting existing trade arrangements and methods of selling in the wholesale or retail trade. We also felt justified, for certain special reasons which I shall proceed to mention, in refraining from recommending an alteration in the import duty. Those special reasons are, shortly, that under the Commonwealth Tariff, there has been an enormous expansion in the production of spirits in Australia. That is proved by the following figures: - In 1899 - which was a normal year before _ the adoption of the Commonwealth Tariff - there were distilled in all the Australian States 737,200 proof gallons of spirits, whereas in 1905 the production jumped up to the enormous quantity of 1,506,339 gallons, showing an increase of 769,I39 gallons since 1899. The increase in the main was in the production of spirits from molasses in New South Wales and Queensland. By the establishment of Inter-State freetrade, those spirits obtained free access to the whole of the Australian markets, and an enormous impetus was thus given to the industry in Queensland and New South Wales.' Prior to Federation, those cheap spirits would have had to pay high duties, and, consequently, they were shut out of the other Australian markets. But, as the result of the abolition of the Inter-State duties, the trade in molasses spirit received a tremendous impetus, and their production jumped up from almost zero to 700,000, 800,000, or 900,000 gallons a year. That is a very large expansion. There is also the expansion in the. Australian production of brandy, which accounts altogether for the total increase I have mentioned. In the distillation of whisky, however, there was an absolute and complete collapse, resulting in the closing of all the whisky distilleries in Australia.

Mr JOSEPH COOK (PARRAMATTA, NEW SOUTH WALES) - Has the honorable and learned member any figures showing that during the same period there was an increase or decrease in the local output of pure grape brandy ?

Sir JOHN QUICK -There was a very considerable increase.

Mr Glynn - There was a tremendous increase in South Australia.

Sir JOHN QUICK - The figures I have quoted show an enormous increase in production, and, of course, that increased production meant increased revenue from excise duties. In 1899 the total amount received by way of excise on spirits produced in the Australian. States was only £I47>935 - a comparatively small sum. In the year 1905, however, the excise collected on spirits, under the Commonwealth Tariff jumped up to the large sum of ^£267,454,- showing an increase, as compared with the return for 1899, of ^119,519. The following figures, as to imported spirits, are interesting. In 1899, 2,504,926 gallons of proof spirit were imported into the various Australian States; whilst in 1905, 2,560,813 gallons were imported, showing an increase of nearly 60,000 gallons. I may say that, in the interval, there had been a big jump in the quantity of spirits imported, but that it fell away apparently to the normal figures of some 2,500,000 gallons. There was thus a slight increase on importations and an enormous increase in local production, and in the amount received from the accompanying excise duties. The result is that from imported, as well as from locally - made spirits, there has been a very large increase in revenue since the establishment of the Commonwealth - an increase amounting, probably, to ^200,000. When the right honorable member for Adelaide submitted his scheme of duties on spirits, he based it, no doubt, on certain revenue expectations. These expectations have been more than realized. The revenue has been increasing, by leaps and bounds, and this is particularly so in the case of the revenue from, excise duties, for there has been every year since 1899 a gradual ascent in the returns. In view of these facts, the Commission arrived at the conclusion that, althoughthey were about to recommend a reduction in the' excise duties, they need not necessarily recommend any increase of the import duty. The total amount of revenue from spirits as a whole was so great - so far beyond expectations, and above all necessity that we felt we could reasonably reduce the Excise duties without recommending any increase of duty on the imported article. I am of that opinion still, and I see noreason to alter it. I have not had time to examine the figures quoted to-day, though I mav, perhaps, find an opportunity during the debate to do so, and see whether there is anything to be said about the estimated loss of the £70,000, the ,£80,000, or the £90,000. Assuming the estimate to be true, this expanding revenue from spirit is so great that there is no necessity to have any additional duty, in order to repair the loss.

Mr Poynton - The expansion was much greater in 1901 thai* it is now in the matter of imports.

Sir JOHN QUICK - I have mentioned that in the interval between 1899 and 1905 there was a big jump, but that since then matters have come to their normal level. I did not want to bother honorable members with the figures in full. The real reason the Tariff Commission did not recommend any change was that the revenue was of such a character that burdens might be struck off those suffering from the Excise duties, without imposing further import duties with, of course, a corresponding rise in Excise duties. I intend to support the recommendation of the Commission that there be no increase in the import duty. I see no justification for any increase; the time has arrived when we may fairly say that £2,000,000 is enough to receive from the spirit duties.

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