In introducing this measure yesterday, the Minister did not make a convincing case so far as the activities of the company are concerned. The information he gave us regarding their activities, from inception up to date, revealed incompetence and ineptitude—if the company can be blamed for launching out on a project that could scarcely be made a success. The Minister rather reluctantly told us yesterday that alcohol is now costing 7/6 per gallon. The production of the company at any time was far from economic but, even at present, when compared with the prices of imported fuel for motor propulsion, a figure of 7/6 is outrageous. We imported for the first 12 months of this year 19,000,000 odd gallons of petrol, which cost us £717,000, representing a price of 8.9d. per gallon. That is the figure at which we can secure motor fuel and we have this type of "cod" industry producing alcohol at 7/6 per gallon from raw material obtained at a price that is not economical from the point of view of the producers. Potatoes for this purpose are being purchased at about £4 per ton while the actual market price is over £10 a ton. That, in itself, is an indication of the success of the project. The Minister asks the House to widen the powers of the company so as to permit them to launch into other activities. He expects the House to have confidence in the capacity of the company to carry out certain investigations with a view to engaging in other activities. If the House concerns itself with the record of the company, it cannot agree to the Minister's proposals.
The Minister and the country know that the project has been an absolute failure and that this is an effort to switch over to other activities so as to save the faces of the company and of the Minister. When introducing the original Bill, the Minister informed the House that alcohol would be produced at 1/9 per gallon. It was never produced at anything like that figure. It was produced at about 3/6. The figure I mentioned was the estimate given by the company to the Minister of what their product could be sold at—an estimate that was 100 per cent. wrong. Now, we are asked to provide power through legislation for this "dud" State company to carry out further investigations with a view to activities in other directions. It is almost certain that this company will decide that they are capable of producing certain chemicals—that is, if they want to continue in operation and to draw their salaries. They should not be charged with the responsibility of investigating those matters.
The Minister did not make quite clear to the House the extent to which the Scientific Research Bureau will co-operate with the company or the extent to which responsibility will be placed on the bureau to determine the technical methods to be adopted. If responsibility is to be placed on this company, with its record of ineptitude and failure, I am vigorously opposed to the proposal that it should be empowered to produce sulphate of ammonia. Before the war we were handicapped by not being in a position to buy certain essential artificial manures for our main industry. The price of phosphates was higher here than in any other country, because we were pursuing the unsound idea that that industry needed protection. That had its repercussions. Relatively speaking, we were, probably, the lowest users of phosphatic manures in the world.
It is a very essential plant nutrient that the Minister contemplates can be produced by this company. The Minister referred to the investigation that was carried out by a departmental committee, that he felt was unsatisfactory. I agree that a departmental committee was not the right committee but of the two methods of investigation I would prefer the departmental committee to the method now suggested by the Minister, that this company should investigate the possibilities of producing sulphate of ammonia in this country. It is generally understood that the production of synthetic sulphate of ammonia would require very big and expensive plant and in order to produce at an economic price it would be necessary to produce much more than our own requirements. If we have an output in excess of requirements will it be possible to produce so economically that we can sell on the world market in competition with, say, Imperial Chemicals or other companies turning out huge quantities under most favourable conditions? I warn the Minister that this article is being sold ex-factory by Imperial Chemicals at £9 10s. 0d. per ton. The pre-war price was about £6 10s. 0d.
I am not opposed to an investigation of the possibility of producing a nitrate in this country but in my opinion the people that the Minister suggests should be the manufacturers are not the people to carry out the investigation. It ought to be carried out by an independent tribunal. If this company is to do the job, it ought to give evidence before that tribunal and explain its technical methods and financial requirements, and so on. It is my opinion that if we charge this company with the responsibility of making a decision in this matter, the decision will be to launch into the production of sulphate of ammonia and we will then find ourselves in the position of having to pay for this very essential raw material for agriculture 50 per cent. more than the price at which we could buy it outside and then the Minister will put a tariff on imported sulphate of ammonia or possibly prohibit its importation.
The Minister has been stressing recently the importance of exports so that we may command foreign exchange which is the means of purchasing essential imports. The Minister realises that to a very large extent we must look to agriculture to provide those exports. Therefore, we must get the raw materials for agriculture at the same price at which other countries command them, so that we can compete against these countries in the world market. The Minister must know that every action of his that raises the price of raw material to agriculture is impeding the possibility of expanding agricultural exports. I warn the Minister to be extremely careful in this matter of producing sulphate of ammonia and particularly careful in view of the record of this company. I do not think it is the right type of company for this work. It is the same story, a State company, manned by civil servants, and the taxpayers' money being put into it.
The Minister gave us an account of the capital, £275,763, returning a profit of £14,000. That profit is derived, first of all, by asking the farmer to take an uneconomic price for his potatoes and secondly, by selling the product at an exorbitant price which it could not command but for the fact that the petrol people are compelled to admix with the imported fuel a certain percentage of this alcohol at a price far above that at which fuel can be bought. The price of industrial alcohol is 7/6 as against 8.9d. for imported petrol. It is amazing to find the Minister coming in here, merely to save face and to defend this dud industry, seeking other activities for this company. The Minister has not made a case for it and I think the House, under no circumstances, could agree. Apart altogether from the important consideration of the capacity of the country and the qualifications of the company there are certain objectionable provisions. If we are to rely on the record of this company for our prognosis of its future activities, we can have no confidence at all in this company to carry out the work.
In regard to Section 8, if the facilities are granted that the Minister contemplates, before the issue of certain chemicals a licence would have to be issued. I object to that because I have had experience of a somewhat similar circumstance in regard to the importation of leather. Calf-hide was not produced in this country in sufficient quantities to meet the requirements of boot manufacturers and certain people were allowed to import calf-hide under licence but, when the application for a licence was made, it was sent to a particular tannery and if the tannery could not provide the hide that was required, the tannery recommended the particular applicant for a licence. I am satisfied that the big manufacturers in the boot business were able to secure a licence to buy leather at a cheaper price than the smaller men in the trade and thereby had an advantage in being able to sell their shoes at a lower price. The same abuse can occur here, if we are going to have the same type of machinery in operation. Certain individuals will be favoured with licences to import chemicals and possibly to import at a financial advantage, and the Minister scarcely can contend that that is desirable. The moment you set up this sort of thing, it is inevitable that it will be open to abuse. I suggest that Section 8 of the measure certainly would be open to the abuse of certain individuals being favoured with a licence, to the disadvantage of other people. The Minister certainly did not make a case for extending the powers of the company to enable them to engage in other activities, and I say that they are not the people to carry out these investigations that the Minister suggests. On the record of the company, they are not a company which can command the confidence of this House. So far as this Party is concerned, it could not support the measure.