A. B. FALLOVER.]

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on all tobacco manufactured, either in the way of bonus to the local company or increased tariff against outside companies operating and manufacturing in New Zealand. To Mr. Hudson: With regard to the suggested payment of Id. as an encouragement to the grower, I say that if the Government would increase the tariff, or give a bonus to the local companies, or take away the excise duty of Is., the companies could increase the price to the grower. At the same time it would make safe our position against outside competition. To Mr. Poland: We would be pleased if the Government would give a bonus to the growers on condition that they sold to New Zealand companies with New Zealand capital. It would require 3,800 acres to supply New Zealand requirements. There would be no necessity then to import tobacco. Australia is to-day growing about 1,000,000 lb. weight of tobacco, or about 8 per cent, of the total amount of tobacco in use. To Mr. Sidey: A bonus of Id. to the grower is not sufficient, and I suggest that it ought to be Is. On 10,000 lb. of tobacco a man would get a bonus of £500. The new piece of ground we are looking at is a mile and a half from the sea, and hills between the block and the sea. Mr. Gilmour has not seen the land yet, so cannot express an opinion about it. Nelson can supply a bright leaf and Hawke's Bay a dark leaf, and that being so the works need not be shifted. I am arranging to put down 20 acres near Whangarei, and I am inquiring for an analysis of the soil of the Cook Islands. I have seen samples of tobacco grown in the Cook Islands. If Nelson is the most suitable place it does not follow that the factory should be there. There is more labour at Napier than at Nelson. Here we have the option of drawing labour from Napier and Hastings. If Nelson grew sufficient tobacco to run a factory we might put up a branch factory there and manufacture certain classes of tobacco, such as the cigarettetobacco, while we could manufacture plugs in Napier. J. 11. Edmundson, representing Acetone Illuminating and Welding Company (Limited), examined. We have expended quite a large amount of money in establishing a new industry. We had to pay very heavy duty on all our machinery when we imported it into the country. Some of the gases like those we are manufacturing are being imported into this country free of duty — for instance, nitrous oxide—N 2 0. That appears to me to bo an unfair position to put a young industry in. We paid over £2,000 in duty on our plant. We made representations, but we got no satisfaction. In addition to that, we have put the railage question to the Railway Department on quite a number of occasions, and we have had no satisfaction in regard to that either. Our gases are classed "A." In England railway companies are pretty conservative, but they class our gases in the same class as they carry soda-water. Soda-water in this country is Class B. I do not see why our Railway Department should not carry our gases under the same class as the gases in England are carried. This makes a considerable difference. For instance, the difference of Class B and A on a set of cylinders of gas to Dannevirke from Napier — seventy-nine miles —is as follows: Class A, lis. lid.; Class B, 9s. lid.; and 225. 9d. and 17s. 9d. On the other hand, ammonia comes under Class A—that is, the imported ammonia— whereas the ammonia manufactured at Christchurch comes under Class B; so that the Department has given preference to the locally manufactured article in the case of ammonia, To the Chairman: We hardly hope for a refund now after such a lapse of time, but we want to get the railway charges put right. I do not see why they should not give us something even better than we are asking for. In some cases we pay the freight, and in some cases the customer pays. It would often make a difference in the price; the user pays in the long run. I think a reduction in the freight would lead to increased consumption; the cheapening of an article always popularizes it, even if it i« only a small amount. To Mr. Veitch: The gases are used in the engineering business for welding, also for. marine lights. We supply the Marine Department for forty lighthouses around our coasts; we also supply dentists with anaesthetics. The Railway Department says that our product is a dangerous product. If the English railway companies are prepared to carry the gas at the same rate as soda-water they cannot regard it as being very dangerous. We have had no outside competition in regard to compressed oxygen or compressed acetylene; but these articles have been used rather more extensively in England and America since the war started. Those countries have increased their output of these goods, and it is quite likely that we might have to meet competition in the future in that direction. In the matter of nitrous oxide, that article is being imported in competition with our manufactured article. We had to pay duty on the plant to produce that gas. The English gas is being imported in competition against us, and it is free of duty. I ask that there should be a duty put on that gas. And in the event of the other gases coining in in competition with us I suggest that a duty should be put on them also; up to the present we have had no competition against us in regard to the other gases. To Mr. Poland: The Railway Department does not take special precautions in carrying the gas; they carry it as goods or parcels and in ordinary trucks. I think that probably 50 per cent, of the nitrous oxide used is imported. We can produce all that this country requires. In the event of a duty being put on imported nitrous oxide, in order to make it clear that the public was not being exploited we would be prepared to submit our prices to a Board. To Mr. Sidey: Our head office is in Napier, and we have works here and in Dunedin. I think the duty we paid on our machinery was 20 or 25 per cent, We originally started business in this country about ten years ago. We paid the duty on our last plant for nitrous oxide about two or two years and a half ago. We import nitrate of ammonia to produce the gas :it is admitted free. I do not think there is a sufficient quantity of that article required in New Zealand to warrant the erection of a plant for its manufacture.