COLONIAL INDUSTRIES.

Globe, Volume XXIII, Issue 2259, 25 May 1881, Page 4

COLONIAL INDUSTRIES.

The following article with reference to the report of the Royal Commission on Colonial Industries appears in the Melbourne “Argus” of April 30th : The full text of the report of the commission appointed to inquire as to what assistance can be rendered by the State to the local industries of New Zealand has reached us. The commissioners are men of mark and of great colonial experience, and the name of Mr Edward Wakefield, the ohairman, is a tower of strength in itself. It is evident from the proceedings that the commissioners have individually a strong desire to develop colonial resources ; they took a mass of evidence, and their conclusions, which apply equally to Australia and New Zealand, are worthy of all consideration. The commissioners state, [at the outset, that the great staple industries upon which the colony mainly depends for its wealth are too firmly established to need any assistance from the Government. The most ultra of protectionists will accept this dictum, wo presume, with a reservation, in whioh we would heartily concur. The Government cannot assist our staple industries by aid at the Customs-house nor by bounties, but, on the other hand, by the judicious construction of roads, railways, and telegraphs, by facilitating intercourse and transmission to market, the state can materially benefit the staple industries of the land, and our contention is that all our efforts should take this direction, for it is the one true way of encouraging local industry. The Commissioners go on to say that though the great industries cannot be assisted, yet “ much injury might be done to them, as well as others less fully developed, by capricious alterations of-the fiscal laws and to the truth of this dictum the condition of the agricultural interest in Victoria bears ample witness.

Turning from the great to the minor industries of the colony, the commissioners state that the views of those persons most directly affected by the issue, whether protective duties are required or not, are most contradictory. Many persons urge the desirability of imposing protective or even prohibitive duties upon manufactured articles. Others again, engaged in precisely the same trade, and appearing to be equally capable of arriving at a sound judgment, advocate exactly the opposite course. The promoters of some local industries ask for protective duties on the particular articles whioh they produce, while other promoters of local industries show that protective duties on those very articles would crush their hopes of success. For instance, one gentleman is anxious to start bottle works, but he finds that while bottles can be imported at Is per dozen, they cannot be made under Is fid per dozen. He proposes therefore —

“ 1. That the State levy a duty of 7d per dozen on the imported article, in order that the projected new industry may grow and prosper. If no duty be levied the sand* must remain of comparatively little value, and many willing hands must remain out of work. If this mode of encouraging a valuable industry ia objectionable, the State might—“2. Levy a tax—say an amount equal to 7d—from the public for every dozen of bottles manufactured, and give the tax as a bonus to my constituent.” On the other hand, a dozen firms, making pickles, preserving fruit, &0., declare that a duty on bottles will be a blow to their enter* prise. One set of men declare for a duty on malt and hops; another set aver that such a duty will cripple their operations. The owners of one woollen mill contend that if fine yarns were admitted free, a greater variety of fabrics would be made, and the whole industry would be greatly extended, while the directors of another mill protest that the concession would mean “ ruination to the native industry.” We are well acquainted with such difficulties here. We can affirm the wisdom of the commissioners in their conclusion “ that there ia no doubt that in the nascent stage of the industrial energies of the colony there is every danger of the protection of one trade proving detrimental to others,” and that “in affording special advantages to one section, a blow may be unintentionally, but none the lees effectually, struck at other industries, in the prosperity of which all sections alike are interested.”

The commissioners review the actual and the possible industries of the colony in detail, and they suggest that bonuses should be offered for the production of linseed, starch, sugar, and cement. They favor assistance to permanent agricultural improvements, in the way of drainage and irrigation. They speak strongly in favor of the conservation of the forests; they express the hope that the Public Works Department will help in the opening up of coal seams, but they deprecate an import duty on fuel, and they congratulate the colony on the growth of the woollen, the earthenware, and the leather trades. The commissioners would appear to lay down twe principles, namely, that when aid is given to an industry, it should be direct; and secondly, that it is only worth while to aid industries which develope local resources. They draw a distinction between subsidising a workshop and starting a local industry. In both instances, the commissioners show their common sense. The bonus system is liable to abuse, no doubt. A company may work for the rewards, and not for the development of the industry : but still, if the enterprise is started in good faith, the capital may have the desired effect, and if the enterprise is not lona fide, the community suffers only the one loss. The distinction between local industries and foreign workshops is also real. As a matter of fact, a duty in favor of a bona fide local industry soon becomes useless. Import duties on gold, wool, wbeat, butter, are all non-effective, Natural and national industries are certain sooner or later to cone to the front, and thus we find all the colonies are tanning leather, making boots, weaving olotb, and burning bricks. In these cases protective duties are unnecessary, except it may be in protective colonies, as counterbalances to vicious duties imposed in other directions. But with umbrella-makers and cork-cutters the case is different. Foreign materials are operated upon, no local resources are developed, and to expend our energies and our money in such directions, is as unpatriotic as it is unwise. Mr Murray Smith has called attention to this distinction between the two classes of minor industries already, and it is possible that a fiscal compromise may yet be effected in Victoria upon the lines thus indicated. In the meantime we are sure that much good would be done by an independent commission making such inquiries as did the New Zealand body. Our most successful manufacturers, we are sure, would report that they rely not upon duties, but upon the natural advantages possessed by the local producer, and would express the opinion that it would be better for them to have the support of a comparatively untaxed, and therefore a richer, body of customers than that of the Customs House. Mr Berry has long promised a Boyal Commission to inquire into the tariff, and if he would redeem that promise, the result could scarcely fail to be the enlightenment of the community.