Ship Bounty Act 1939

How much is the bounty?

The bounty is paid per gross ton and depends on the size of the ship. Larger ships attract a lower rate per ton — the rate steps down as tonnage increases:

• Ships of 100–750 gross tons: £12/10s per ton
• Ships of 750–900 gross tons: £12 per ton
• Ships of 900–1,050 gross tons: £11/10s per ton
• Ships of 1,050–1,200 gross tons: £11 per ton
• Ships of 1,200–1,350 gross tons: £10/10s per ton
• Ships of 1,350–1,500 gross tons: £10 per ton

The bounty scheme lasts for three years from when the Act commences.

Key rules and limits

• Annual cap: The government cannot pay more than £50,000 per financial year in total bounties. If all valid claims exceed this cap, each builder's payment is reduced proportionally.
• Profit cap: If a builder's net profit exceeds 10% per year on the capital they invested, the Minister can claw back bounty already paid or withhold future payments.
• Fair wages requirement: Builders must certify that they paid workers at least the award wages (minimum pay rates set by courts or industrial tribunals) applicable in their area. Failure to do so can result in losing the bounty.
• Workmanship standard: The Comptroller-General of Customs must be satisfied that the quality of construction is acceptable.
• Instalment payments: Builders can apply to receive the bounty in quarterly instalments as construction progresses, rather than waiting until the ship is finished.
• Customs duty interaction: If import duties on ships go up (making it cheaper to buy overseas), the bounty rate is adjusted down by an equivalent amount, and vice versa.

Compliance and oversight

Builders must:

• Keep detailed financial records and have them audited
• Allow government inspectors to board ships, enter yards, and examine books
• Answer questions under oath if required
• Provide security (a bond or deposit) if the Minister requires it

Penalties apply for:

• Obtaining a bounty you're not entitled to
• Making false statements — up to £500 fine or 12 months' imprisonment
• Refusing to cooperate with inspectors — £50 fine

Transparency

The government must produce an annual report to Parliament listing every builder who received bounty, how much they got, and details of each ship.

Why does it matter?

This Act was created in 1939 — at the outbreak of World War II — to stimulate Australia's domestic shipbuilding industry at a time when the ability to build and repair ships was strategically vital. It reflects a classic use of bounties (government subsidies tied to production) to develop local industrial capacity.