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Tuesday, 8 November 1910

Senator ST LEDGER (Queensland) . - I do not intend to offer any opposition to this Bill. So far as we can gather, it is the will of the people that what may be termed Australian industries shall be assisted by more or less effective protective duties, or, in the circumstances outlined by the Minister on this occasion, by bounties. I am not, as is well known, an ardent admirer of the practice of appealing to the State as a first and last resource for the encouragement of the industries of the country. I recognise that, in a new country, industries require some assistance to enable them to compete with the industries of older- settled countries.

Senator de Largie - The State the honorable senator represents is a marked instance of that.

Senator ST LEDGER - I do not intend to allow the interests of any particular State to influence my consideration of this Bill.

Senator de Largie - The honorable senator is living in a glass house.

Senator ST LEDGER - The honorable senator is, no doubt, a little sore because he recognises the weakness of his position. I am not throwing a single stone in exercising my right to comment upon this proposal. It does not strike me as a very effective business proposition. We have had a good deal of faith and hope in Australian industries, and we may hope that this industry will turn out as well as we anticipate. The business aspect of the proposal cannot be overlooked, because it is the people who will have to pay. If the proposal leads to the establishment of a staple industry, it will, no doubt, be good business in the future; but we ought to have some regard to the business aspect of the matter in the present. The Minister referred to the establishment of a powerful and influential company, but he did not mention that it is largely financed by absentees. I have no particular prejudice against them or love for them. If there is a good business proposition which we can carry out with Australian capital, well and good;if outside capital is required, and we can secure it, well and good also. The Commonwealth Oil Corporation has invested £1,000,000 in the development ofthis industry ; and the Minister has informed us that they are willing to invest a further sum of £250,000 if they are given this encouragement of a bounty. We are asked to offer a bounty of £50,000 to induce the company to complete their operations. I find myself striking in this matter a note which is almost identical with that struck by Senator Rae in his criticism of this measure. If the company in question have not been able to profitably develop the industry by the expenditure of £1,000,000, can we expect that the success of the industry will be in view if the Commonwealth affords the company assistance to the extent of £50,000, the expenditure of which is to be spread over three years?

Senator E J RUSSELL (VICTORIA) - Does the honorable senator think that the amount proposed is not enough?

Senator ST LEDGER - In the circumstances, I think that the amount proposed is either too much or too little. It is evident that, even in its initiatory stages, the industry is likely to be a monopoly in the ordinary sense of the term. If the Minister would agree to side-track himself a little, though I suppose he will not do so, he might explain how it is that we have such evidence of a mortal antipathy to monopolies as is expressed in certain legislation with which we have recently dealt; and at the same time, the Government propose that the taxpayer shall be called upon to give assistance to support an industry which is a monopoly.

Senator E J RUSSELL (VICTORIA) - Is the honorable senator's knowledge of Australia so limited that he thinks shale is only to be found in New South Wales?

Senator ST LEDGER - Not so; but I think that the only company at present in Australia which is in a position to develop the industry, is the company operating in New South Wales. No sensible man will argue that within the next two years the company will not absorb three-fourths of the proposed bounty.

Senator E J RUSSELL (VICTORIA) - How can it become a dangerous monopoly, seeing that it has the strongest competitor in the world arrayed against it?

Senator ST LEDGER - I am not concerned with monopolies which exist outside of Australia. By means of the payment of a bounty it is proposed that this Parliament shall assist a particular company practically to become a monopoly. The policy of encouraging industries by a system of bounties has proved anything but a success in Canada. Particularly is that remark applicable to the production of iron and steel. When the Dominion Parliament approved of the payment of bounties in that connexion, it provided that they should annually diminish, and that finally they should disappear. But what hap.pened? The moment the bounties were withdrawn the production of iron and steel declined to such an extent that indications point to the industry reverting to its original position. Similarly, I do not think that the results which have flowed from the legislation which has been enacted by the Commonwealth Parliament in regard to the payment of bounties upon other products encourage us to persevere in this direction. Except in the case of wool tops, those results have been almost of a negative character. In this connexion it is well that we should sound a warning note to the Ministry.

Senator Rae - Is it not a fact that twothirds of the amount voted by Parliament for bounties remains unclaimed ?

Senator ST LEDGER - t think that more than that proportion remains unclaimed. In answer to the interjection made by Senator de Largie some time ago, I wish to point out that the sugar industry is the only industry in the world which has been 'satisfactorily developed by means of what has been miscalled a bounty, but what, for all economic purposes, is in reality a rebate. I need scarcely point out that the sugar growers contribute more to the revenue by way of Excise than they receive from it by way of bounty. That is my reply to the taunt of the honorable senator.

The PRESIDENT - I hope that the honorable senator will refrain from discussing the sugar industry.

Senator ST LEDGER - I have always regarded the industries of Australia as enterprises to which the State can well afford to extend some assistance. I shall support the Bill upon the general ground that we must deal with conditions as they exist. If, by means of this legislation, we can establish a single industry which will provide employment for the people, we are amply justified in enacting it. But we must act with prudence and caution and not flagrantly disregard economic laws. I hope that the proposed bounty will be justified by results. But I wish honorable senators to understand that I make these remarks without prejudice. Because I have spoken to some extent favorably of the Bill 1 do not feel myself committed indefinitely to the policy of encouraging industries by the payment of bounties. If the Commonwealth Oil Corporation cannot successfully carry on operations after the next three years, it will have no right to approach this Parliament for a renewal of this form of assistance for a further term. There ought to be some finality in the matter.

Senator Chataway - The Bill limits the operation of the bounty to a period of three years.

Senator ST LEDGER - But we have to consider what may be the effect of this policy at the expiration of that term. There are very few protected industries which have not urged the fact that they have been assisted by the State as a reason why still further encouragement should be accorded to them. The strongest arguments will have to be advanced by the Commonwealth Oil Corporation to induce me to vote for the granting of any further assistance to it.

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