THE CUSTOMS BILL

Dominion, Volume 15, Issue 56, 30 November 1921, Page 6

THE CUSTOMS BILL

SECOND READING MOVED THE REPORT OF THE COMMISSION ENCOURAGEMENT OF INDUSTRIES Ths Prime Minister moved the second reading of the Customs Amendment Bill in the House of Representatives last night. His motion followed the adoption of some amending tariff resolutions. Mr. Massey explained the policy underlying the Bill, and read to the House some portions of the report of the Tariff Commission. He was followed by the Leader of the Opposition.

Mr. Massey said in opening (hut he believed it would bo necessary in the future to revise the tariff at intervals of not more than five years. The last important revision had taken place in 1907, and since then many anomalies had arisen. Tho interval had been too long, but naturally the Government had not been able to undertake the revision of the tariff during iho war years. Tho new tariff, as embodied in the schedules of the Bill now before the House, proposed some important amendments. He was glad to say that the Government had been able to avoid anything in tho nature of an increase in the duties on the necessaries of life. The increases had been confined to articles that could bo described as luxuries. Tho Government had done something in the way of giving additional protection to young and promising industries. He believed, after hearing much of the comment on the tariff, that the proposals had been approved by the majority of the people throughout tho country. Many of the changes that had been made in the tariff, continued the Primo Minister could bo attributed to the., fall in tho public revenue. A very great fall had taken place during the last eighteen months He would have another opportunity to discuss this matter. He had indicated 'already that he proposed to increase the totalisator tax and tho amusement tax, and he hoped that these changes, when he brought tho legislation before tho House, would have as good a reception as the preseni Bill had received- The fall in the revenue had been so serious that the Government was forced to spread the burden of taxation over a wider area. It would have been unwise to have asked the payers of land fax and income tax to continue to carry the burden that had been placed upon their shoulders in the war years.

Turning to the details of the new tariff, the Prime Minister said that he was a strong supporter of Imperial preference. New Zealand was extending its preference to British goods, but stß* was not doing as much.as Canada', was doing. It should be noted that thp British Parliament had accepted the principle of preference, though New Zeawas receiving no present benefit. The Bill, said Mr. Massey, •was making drastic provision against dumping. This provision v.'.is necessary. If dmfiping were permitted to proceed unchecked, it would be a very bad thing for the country. -Another matter dealt with by the Bill was the difficulty arising from dn>d currencies. The countries which had fluctuating currencies were tn a jnbsiH.'in to compete on conditions that’ woitf "most unfair. The German mark, for example, 'had fallen in value until £1 sterling was worth 1125 marks instr”’* of about 25. If tho tariff took no notice of this state of affairs, cheap German (roods would do great harm to New Zealand industries and to British trade with this country. THE TREATY WITH SOUTH AFRICA. Tho Prime Minister mentioned tho. trade treaty between New Zealand and South Africa. He said that this treaty could not be amended at once. Six months’ notice required to be given before the revision could be undertaken. Australia undoubtedly had a grievance owing to 'the special treatment given to South African goods by New Zealand under the treaty, and he hoped that the time would come when Australia and South Africa would be placed on an equal footing in th" New Zealand market. lie did not wish tn see commercial war between the two British countries of the South Pacific. New Zealand and Australia ought to bo able to work together. NEW ZEALAND INDUSTRIES. The tariff, in his opinion, was providing for tho development of New Zealand industries. It would not please everybody, but it would encourage the. use of raw materials within the Dominion. Now- Zealand ought to look forward to using an increasing part of its own rawmaterials. There should not be any antagonism between the primary and tho secondary industries. The Prime Minister paid a tribute to the members of the Tariff Commission, who in his opinion had done particularly good work. He proceeded to quote portions of the commission’s report. The document, ho said, would be printed for the information of members. The commission had laid down a rule that protection should not. he removed from industries that were being developed under protection at the present time. It had also laid down the following principles for guidance in the framing of the new tariff: — / Any protection given should be well devised and not more than

sufficient for the welfare of tho industry concerned. Effective provision should be made against dumping. The profits of those engaged in protected industries should b? subject to periodical investigation by an authority such as the Department of Industries and Commerce. The encouragement of industries through protection should be directed mainly to those industries which obtained their raw materials wholly or chiefly in New Zealand. Provision should be made for lhe encouragement of scientific research and for the training of skilled workers and artisans. Arrangements should be made for giving- due notice of the removal of protection from industries, the protection to be regarded ns a temporary measure, and to cover a sufficiently long period for the development of the Industries. The commission had noted that for many years it had lieen argued that New Zealand’s industrial conditions were not suitable tor the development of manufacturing industries, because waves were so high and tho. comKUons of labour were so good. This argument, in the opinion of the commission, was unsound. The members of lhe commission believed that good conditions of labour wore a good basis for a sound industrial structure. A comfortable standard of living for the working men was not incompatible with the progress of th:- manufacturing industries suitable for establishment in New Zealand Tho remarkable development of industrial technique was rapidly removing the necessity tor unskilled and degrading toil, and New Zealand manufacturers had

been compelled, owing to the shortage of labour in the Dominion, to make the fullest use of mechanical devices. Much of the shortage of labour, the commission suggested, could be removed by the systematic encouragement of suitable immigration and by tho training of workers and artisans. Mr. Massey concluded by remarking that he considered the clauses of the Customs Bill to ho self-cxnlanatory. lie would' reserve till the committee stage any explanations that were required. OPPOSITION CRITICISM. The Leader of the Opposition (Mr. T. M. Mulford) joined with tho Prime Minister in praising the work done by the head of tho Customs Department (Mr. Montgomery). Mr. Wilford proceeded to complain that on account of a regulation of August 25 last, which was to come into operation on January 1 next, and which dealt with the method of assessing duty on goods imported from countries having an appreciated rate of exchange, no importer could consider, his position defined by the Tariff Bill. ' The whois Bill had to bo read in conjunction with that regulation, so far as goods imported from countries with an appreciated exchange were concerned. Importers had been anxious, to know- whether the regulation was being superseded. They had been informed that it was not cancelled by the new tariff. Th" effect was that after January 1 it would be. anil" impossible for an importer to calculate the selling price of. or th" dutv on, goods coming within that regulation, until the rate of exchange in the country from wlii"h the goods were exported was known. It was objectionable that this matter should have been left indefinite and that it should have been dealt with in a regulation instead of being included in the legislation before the House. _ On certain points he proposed to join issue with the Government in. committee on (he Bill Ho would move for a reduction in the duty on tea. Moreover lie considered that the Government had penalised the schools of the Bmmnion in regard to sports requisites. Air. Wllford proceeded to indicate to the House tho contents of correspondence _ which Inv before him in a heap upon his desk. Tho correspondence had reference nmnv particular itorns of the tariff. U asked the Minister to consider whether ihe proncr duties were 'being imposed on ° candles, incubators. Wom-apb macl- - and certn.in er. articles rim-n. he was informed wore being mode in hen Zealand. He considered that: the rov enue argument alone could he ndiam. ad acainst his claim for the remove o " dntv on ten. The amount brought in bv the duty on tea-some £129.090 I>er nn , l _eoiild. he believed he made up I,v areadjustment of the duties on. some Xr items. The tariff was not. going to make tho average housekeepers bill expenses nny lighter. KING CHARLES’S HEAD.

Mr IT E Holland (Buller) was glad removal of tne ]<-. • i; v in^; vet tariff increased the cost while the Bill made proposals ihM were going to ’heiensc m • jncrease of made no proposal foltl e wages in ratio wi.i industries e ° St to be protected through the IS Ita 'to'” Y u -not bo made to pay for nshould nor no ... , , j tg po ]. While the/tovernment :' h preference, it plied to ’.ana 'UX'Bill was the power serious feature of t c ~-onosed io take which the Government f °U of m'ntor Tho rower to legissorts of nmttcr.. au(l more late was bcuu •« it nuffht tn from those in whobo churlv vested in “that the Prime Minister is in llan "®r of losing his head—but he is in danger o'f losing his scat.” fLamrhtcr.) Tt. was loft entirely to the Minister to <‘’torm.m the amount of tho flumping dity- Mhy should the duties not be determined by the House? , , . , A member-. It would not be quick enough. , . ( •‘All tho time the power is being wrest Cd away from the people’s rcnreseii a- >• A( r . Holland asserted. Not only, Im added, was the power to make the dumping duty vested In the Minister, the power to refrain from imposing tne dutv oven where there was dumping, was being taken for tho Minister. Ho did not think any Minister would care to assume the rcsnonsihibtv involved. Air T K. Sid n y (Dunedin South) also complained that the Government was taking the power of. taxation out of the hands of tho people. After reviewing some of the changes made since the introduction of the first tariff resolutions, he said it was evident that the Government did not know its own mind. It was neither free-trade nor protectionist; and an ineffective protection was the most costly a country could have. Judicious protection did not raise prices against tho consumer, because the stimulus given to local industry promoted competition, which kept prices down.

elasticity in the tariff.

Mr. A. Harris (Waitemata) said that unless a tariff was made os 'elastic as possible it would not work satisfactorily It was therefore essential that, the Minister should be given wide powers. He expected good results from t'he operation of the -anti-dumping clauses of the Bill He thought that t'he principle of preference to Britain might have been applied to fencing wire and agricultural implements by the imposition of a duty against the foreign goods. He suggested that a considerable amount of revenue mi-ht be obtained, without harm to anyone, by the imposition of » small duty on cotton piece goods and a slightly increased duty on silk. Mr. TV. A. Veitch (Wanganui) thought it a bri'mistake to entrust such wide powers to the Minister of Customs. lie thought the responsibilities greater than any Minister should be asked to assume. The Government had reversed its policy. At first it had aimed at revenue only; now it had adopted to some extent, tho principle of protection. He would be surprised if this change had not caused many anomalies to creep into the schedules.

MINISTER OF CUSTOMS

The Minister of Customs (Hon. AV. D. Stewart) said thtf the Order-in-Council referred to by the I,coder of tho Opposition had been gazetted to meet the fact, that the preference given to Britishoimports by tho previous tariff was being largely negatived as against American goods, because of the appreciated currency' of America. The Ordor-in-Counci! had been approved by businc's mon and chambers of commerce. If Mr. Wilford had received any objections, he would bo glad to hear them. Mr. AVilford: Tho provision ought to be in this Bill. Air. Stewart went on to say that people who had never gone near the Tariff Commission were now coming to light with a demand for protection. That was one. of the difficulties with which the Government had been faced. 'The member for Buller had taken strong exception tho powers given to the Minister. But if tho member looked at tariff legislation in other countries he would see the tendency to vcsl extensive powers in some such authority as tho Minister, so as to

make the tariff flexible and easy in its working. The alternative was a castiron tariff which could not be promptly adapted io rapidly-bhanging conditions. Many of the powers Air. Holland had referred to had to be exercised subject to confirmation by Parliament. How could a schedule of dumping duties be fixed by Parliament, when each case called for such carefill inquiry and the consideration of so many circumstances? There was no basis for the suggestion that the Government had first of all overlooked the interests of local industries, and had then suddenly decided to rive them some protection. Tn support of this assertion, Air. Stewart read to Gm House tho main outlines of policy laid down for the Tariff Commission. The second reading was carried on the voices at midnight, and the House then adjourned.