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Tuesday, 17 October 1972
Page: 1576

Senator LITTLE (Victoria) - 1 wish to support the motion and to congratulate Senator Murphy on bringing it before the Senate. The 2 industries which are most concerned in this matter are the tanning and shoe manufacturing industries, although also involved is the related leather goods industry which manufactures gloves, handbags, purses and articles such as those, which very often these days are not made of leather. I suppose that it remains one of the peculiarities of modern economics that we have allowed the completely free export of hides for as long as we have. The commodity is in short supply throughout the world today. Probably it cannot be processed to a greater degree in our own country before export because there are available now in many countries cheaper labour forces for processing this type of material.

With the development of a new concept of exporting complexes, particularly in the emerging nations, there is a great opportunity for these nations to bring raw material from countries such as Australia straight to the wharf, which is practically alongside a new government created factory which may be leased to a big international combine, and there to process it and then ship it out from the same wharf, thus eliminating transport and other costs. This gives an advantage to the cheaper labour countries, particularly those in the Asian area in which there are longer hours of work and less beneficial employment conditions, in terms of annual leave and so on. Not having to provide these things, which are unknown in some countries, gives those countries an enormous advantage in the processing of leather and allied products.

Tanning is a peculiar industry which has not changed a great deal over the centuries; the processes used today are similar to those which have always been used. The shoe industry probably is the most labour absorbing industry of all the apparel industries. Far greater labour resources are required to manufacture a man's shoe than a man's hat. Although those articles may retail at somewhat similar prices, there is a much greater variety of components in shoes and certainly much more complicated methods of manufacture are involved - even though they in themselves, have been simplified tremendously. One of the challenges to the shoe industry during the past 20 to 25 years has been the simplification of the process of manufacture because shoes do not have to be constructed as strongly as they used to be because people do not walk on wet pavements or through muddy streets, except in the developing areas of the big metropolises where some streets are unmade. Now people use motor cars whereas they once used to walk. So the requirement of the shoe industry has changed.

For many years I have wondered, because I was employed in the shoe industry for nigh on 20 years, about the popularity in countries abroad of some Australian hides which were used comparatively rarely, particularly for shoe manufacture, in this country. Twenty years ago I was doing a research programme in the United States of America. Without question the most valuable and the best hides for leather for the manufacture of shoe uppers were wallaby and kangaroo hides. Shoe manufacturers here recognised it. In America those hides were highly prized and highly priced. In Australia the hides, even when tanned and produced as leather for manufacturing purposes, were comparatively cheap. The shoes were never as popular in Australia as they could have been because of the bramble scratches on the hides which gave them a scarred surface which had healed over but had left a mark on the hide. They were pitted and people did not go for them. Their durability, the suppleness of the leather and their wearing potential, when compared with calf skins or any of the other usual hides used for boot or shoe upper leather manufacture, were probably of the ratio of about 3 to 1. America recognised it. Americans were prepared to pay high prices for shoes with bramble or scrub scratches on them where the animal had scratched itself going through the scrub, as kangaroos and wallabies do. We liked the very shiny calf skin which had been protected in a farmer's property and did not have very many scars on it, although it had nowhere near the durability of the other.

I have wondered about these tricks of the industry. Why have not we popularised our product in our country more than we have? There seems no reason why there could not have been a complete ban on the export of kangaroo hides to a high wage level country such as the United States of America which is still, as I understand it, the main user of our kangaroo skins. That would have meant that the processing of that type of leather would have had to be done in this country and the processed leather would have been exported. We are not exporting to a country which can process the hide more cheaply than we can, unless it is being exported to American companies which have branches in countries where labour costs are somewhat cheaper than the labour costs here.

The shoe industry has had to face the introduction of synthetics. Their introduction has had a very powerful influence on the industry. They constitute a real challenge. As I understand the position now, from the rather hazy information that I have, synthetics are one of the greatest challenges to the industry. The Senate Standing Committee on Industry and Trade could examine matters such as this. About a year ago when I was abroad - because of my background, I am a leather enthusiast - I brought a pair of shoes made from a product produced by the Dupont corporation. The product is called corfam I am wearing those shoes at the moment. After 12 months' wear I would defy anybody to distinguish them from leather. Both soles and uppers are made of corfam They seem to wear indefinitely. I understand that Dupont has removed this product from the market, for some reason or another. I do not know whether it is like the match that never wore out and it is ceasing to be a profitable product to place on the market.

This is the sort of challenge that industries such as our shoe industry, a high absorber of labour, have had to face in this country. They have done it with little complaint to date. They have made their representations. The shoe industry has been granted reasonable tariff protection because of the low manufacturing costs and the low labour costs in many of the competing countries. In spite of that, it has still paid retailers in this country to import from the low wage countries of South-East Asia volumes of the cheaper type of footwear, which is very often made out of leather substitutes, to compete with the Australian industry. It is one of the factors that has had a depressing effect on the industry for a considerable number of years. As more simplified methods of production have been evolved and as sandals have become popular with the people, it has been found profitable to import this type of footwear to the detriment of a section of the industry that was a very valuable adjunct to the Australian shoe manufacturing industry as a whole.

I do not want to go into the matter any further because the only requirement is for the Committee to establish that such an inquiry should be made. I limit myself to that statement, but if one wanted more information one would have to consider only the situation of big companies which were household names in this country, such as Bedggood Shoes Pty Ltd which was sold to an international company which ultimately closed the business merely to realise on the capital asset of the property. We support the motion.

Sitting suspended from 12.47 to 10.15 p.m.

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