25th Parliament · 1st Session
Mr. SPEAKER (Hon. Sir John McLeay) took the chair at 2.30 p.m., and read prayers.
Dr. J. F. CAIRNS presented a petition from certain electors of the Commonwealth praying that the Government will reverse its decision to send conscripts to serve beyond the Commonwealth and its Territories.
Petition received and read.
Similar petitions were presented by Mr. Uren, Mr. Bryant, Mr. Beaton, Mr. L. R. Johnson and Mr. Hayden.
Petitions severally received.
– I refer the Minister for External Affairs to a report that the Prime Minister recently flew over an unfriendly country, namely, Cambodia. Does the Minister consider Cambodia to be an unfriendly country? My impressions while in Cambodia were that it was more than a little well disposed towards Australia.
– As always, the honorable member’s impressions are infallibly correct. Cambodia is a friendly country. We are very glad that our relations with Cambodia are friendly. I know nothing of the report which appeared in the Press, but certainly, to describe Cambodia as an unfriendly country is quite wrong. I do not know anything of the details of the Prime Minister’s flight but as recently as last December I found the Cambodian Government quite ready to allow a Royal Australian Air Force aircraft in which I was travelling to fly across Cambodia. The Cambodian Government co-operated in the arrangements for that flight.
– I refer to a question asked of the Minister for Defence yesterday by the honorable member for Lilley and the Minister’s reply that only 10 Citizen Military Forces volunteers were in Vietnam and that a further IS had been accepted for service in Vietnam, ls it a fact that more than 300 C.M.F. personnel have volunteered for service with the Australian Regular Army? Have restrictions on age, rank and qualifications, lack of employment protection and the refusal of employers, including this Government and its instrumentalities, to grant leave for the two year period necessary for service in Vietnam militated against a higher response to the Government’s request for C.M.F. volunteers for Vietnam? Should volunteers be denied-
– Order! The honorable member is making a second reading speech. He should ask his question.
– Should volunteers be denied the re-establishment rights now conferred on national servicemen?
– I hoped that when, in answer to a question yesterday, I cited the number of Citizen Military Forces volunteers who had been accepted for the Australian Regular Army no inference was drawn that the number of such enlistments is regarded as unsatisfactory. I should make it plain that the invitation to members of the C.M.F. to volunteer for service with the Australian Regular Army in Vietnam was in order to provide opportunities for C.M.F. officers to gain operational experience. The C.M.F. was never regarded as a major source of likely recruits for the Australian Regular Army. If there had been a major response from the C.M.F. it is clear that it would have left the C.M.F. quite deficient in some important aspects of officer component. To date, 120 members of the C.M.F. have volunteered for service in Vietnam. Of that number, 34 have been accepted and are either in service or training. It is true that age, rank and qualifications have limited the number who can be accepted because, in fact, the Army is looking for those representatives of the C.M.F. who have experience and arc able to fill non-commissioned officer and junior officer ranks. Members of the C.M.F. who have served with the Australian Regular Army are treated in all respects the same as members of the Regular Army. The provisions as to re-employment were written into the legislation to safeguard the rights of those who were compulsorily taken into service. These provisions apply to national servicemen and in times of defence emergency they would apply to reserves and members of the C.M.F. Since the question was asked yesterday, I have made it my business to make certain inquiries. I can find no evidence that the absence of reemployment rights has in any way restricted the number of applicants from the C.M.F. In the absence of pressure on the C.M.F. for enlistment, there is a clearly identifiable difference in status between national servicemen, whose rights to re-employment must be preserved, and members of the C.M.F. volunteering for short service, who have the capacity to accept or reject the conditions of enlistment.
– I preface a question to the Minister for National Development by pointing out that yesterday I attempted to ascertain from the Minister the whereabouts of the Loder Committee’s report on transport costs and the report on beef roads. I was ruled out of order-
– Order! The honorable member would not be wise to pursue that line, otherwise he may again be ruled out of order.
– In view of the fact that the most important and most publicised beef roads report was completed 10 months ago, will the Minister inform the House when this Parliament, the cattle industry and local authorities throughout northern Australia will be given the privilege of examining the report? Will they be able to study it before its substance is completely out of date?
– The beef roads report was a report from the Northern Division to the Minister and to the Cabinet. It is not the intention of the Government to make this report available, because it is a confidential report by departmental officers to the Government. We have, as the honorable member realises, made additional amounts available to Queensland, to the Northern Territory and to Western Australia for beef roads. We have decided on a continuing programme of beef roads development in Australia.
– Has the Minister for Labour and National Service seen reports that the Commonwealth Conciliation and Arbitration Commission in making its decision in the 1965 national wage case may have been influenced by the views of the Vernon Committee on the fixing of wages? Are there any grounds for supposing that these reports are well founded?
– I have seen reports of this kind. My inquiries indicate that there is virtually no possibility that the report of the Vernon Committee played any part whatsoever in the making of the decision in the national wage case. Although the Vernon Committee did conclude its report before the national wage case decision was arrived at, the report was confined at that time to those Ministers of the Government who were concerned particularly with economic matters, and to their departmental heads on a personal basis. There was no wider distribution of this report until well after the national wage case decision was announced. The only other source of leakage that I can possibly imagine would be from a member of the Vernon Committee itself. Knowing all the members personally, and knowing them to foe persons of the highest integrity, I feel sure that these rumours are unfounded and quite malicious.
– My question is directed to the Minister for Civil Aviation. Did a technician employed by Amalgamated Wireless (Australasia) Ltd. fly for a period in Viscount aircraft in late 1964 or early 1965 for the purpose of carrying out an operational survey of the Bendix radar? Will the Minister confirm that a report was submitted to the Department of Civil Aviation and to the airline companies concerned? In view of the safety issues involved and having in mind the recommendations in the report of Mr. Justice Spicer following the fatal Viscount accident in Botany Bay some time ago, can the Minister say whether any, and if so which, of these recommendations have been implemented?
– I am sorry to say that I have no knowledge of the report referred to. I have not yet come across it. However, I will certainly make some investigations and give the honorable member some information.
– My question is directed to the Minister for the Navy. During the course of seismic operations for oil exploration companies off Lakes Entrance in Gippsland did a 2,400 lb. charge of T.N.T. break from its moorings before being exploded? Is it a fact that this thing, as it is now colloquially called, is drifting around the bed of the ocean and has been declared lost by the Department of the Navy? Is the Minister aware that this is an area that trawlers fish with seine nets scraping the sea bed? Can the Minister say whether there is any chance of recovering this thing before it is picked up by a trawler with consequent damage to vessel and crew?
– No work was being carried out on behalf of oil exploration companies. The Department of National Development, in association with some universities, wanted certain extra seismographic work done in Bass Strait. The Navy undertook, as it had done in the past, to set off the charges. One of these charges did break away because of a fault in a hawser that had a breaking strain of about five tons but broke under a strain of one ton. It is not true that the charge is lost. Irs position is well known and has been marked. I have had representations from the Victorian Fishermen’s Co-operative, as I think it is called, in respect of this matter. I regret that the charge cannot be removed at present. I can assure the honorable member that it will be removed by the first vessel with capacity to remove it that can bc made available. In the meanwhile, the fishermen are well aware of its location. They were concerned that a stray electrical impulse might set it off. I have been informed by the experts of my Department that there is no possibility of this happening although, since the charge is explosive, there is a minimal chance of detonation if an attempt is made to remove it. At the first opportunity, the Navy will deal with it.
– My question, which is directed to the Minister for Shipping and Transport, concerns the construction of two vessels for use by the lighthouse service in northern Australia and the Territory of Papua and New Guinea. I ask: Was the tender for one of these vessels withdrawn? Has it been found necessary to make substantial changes in the original plans? When will tenders for the construction of the second vessel be called?
– This matter would be within the knowledge of the Australian Shipbuilding Board. 1 have not the precise details with me. I shall get some information for the honorable member and give it to him.
– I address to the Treasurer a question relating to the sugar industry of Queensland, many parts of which, as the honorable gentleman will be aware, have suffered greatly from the recent drought. I ask: Has the Government entertained the idea of giving to the drought stricken sections of the sugar industry assistance similar to that given to the dairying and the pastoral industries of Queensland?
– Within the last week, or so, the Queensland Government has informed the Commonwealth that in some parts of the Queensland sugar industry farmers are involved in financial problems owing to the impact of the drought, the tall in overseas prices and other causes. We have been informed also that some of the co-operative sugar mills have been in financial difficulties. The Queensland Government itself devised and forwarded to the Commonwealth Government for consideration a scheme under which advances could be made to farmers to assist them in meeting a levy that they have to face. The State Government has decided to make the funds available by loan at 3 per cent, interest, repayable over seven years. The initial payment is not to be made during the first two years of the loan. This is wholly a responsibility of the Queensland Government, but the arrangement seems to us to be a sensible one to make.
The proposal has been submitted to us by the State Government on the basis that its total commitment will be $2,250,000. Having looked at the proposition favourably, we have decided, under the drought relief scheme applying to New South Wale» and Queensland, to make available $1,750,000 to help the Queensland Government finance the scheme. As the proposal is associated with drought relief, we shall enter into it on terms and conditions similar to those that apply in New South Wales and Queensland to assistance for both carry on expenses and restocking. I hope that details of the total Commonwealth assistance to Queensland and New South Wales for drought relief can be collected in a paper for presentation to the House. The measure that I have just announced will be dealt with in that paper and will be brought before the House when I present a bill to ratify the proposal.
– I address my question to the Treasurer. Is he aware that the Canadian Government has set guide lines for foreign owned companies operating in Canada? Under these guide lines, are foreign companies informed that their loyalties are to Canada, not to their owners in the United States of America or other countries? Has the Minister examined these guide lines? If so, does the Australian Government intend to take similar action?
– On several occasions, the guide lines of the Canadian Government have been examined, but the Commonwealth Government itself has decided the guide lines to permit overseas corporations to borrow in this country.
– To borrow?
– Yes, foreign corporations to borrow on the Australian market. The conditions generally speaking are these: First, the foreign corporation must have existed here and must be carrying on business here; secondly, it must be in the normal course of its business that it attempts to raise loans on the market; finally, the amount of the loans must be responsible. This matter is carefully watched by the Reserve Bank of Australia. It discusses the major problems with us. To my personal knowledge, no loan has been approved that we have regarded as not complying with these conditions, particularly with regard to responsibility.
– -Will the Acting Prime Minister confer with the Prime Minister on his return from his South East Asian tour with a view to making a clear public statement, or perhaps publishing a pamphlet, on the precise rights to re-employment and repatriation benefits of members of the Australian forces serving in Vietnam? I believe that many honorable members will agree that although we are aware of the position, some confusion exists in the public mind on the precise rights of these servicemen.
– I will bring the matter to the attention of the Prime Minister on his return to Australia. I am sure that we would all wish that the rights of servicemen and those who may become servicemen should be clearly understood.
– I ask the Minister for the Interior: What action has been taken to implement all or any of the recommendations of the Joint Committee on the Australian Capital Territory following its inquiry last year into the availability of land in the A.C.T.? In particular, will the Minister say whether action is being taken to implement the recommendation so important to the farmers and graziers of this area relating to compensation for land that is withdrawn from lease for the purpose of the development of Canberra? Will the Minister say whether the Government will now pay just terms of compensation to those farmers rather than merely compensation for the tenant rights in the improvements they have been permitted to make on their leases?
– The matter which the honorable member raises involves a number of subjects. Some of the recommendations of this inquiry by the Joint Committee on the Australian Capital Territory support the action that my Department is already taking. I refer to the amount of residential land that we are making available in Canberra at the rate of 2.500 blocks per year. Dealing with the other question which relates to Australian Capital Territory rural lessees, I have had a great deal of correspondence with and also interviewed deputations from, those who are concerned with the matter. The Department of the Interior and I have explained quite clearly to these people the terms of the leases that are given to them. Under the terms of these leases, we compensate lessees for the value of improvements on their land. There is a clause in these leases - it is termed the withdrawal clause - which provides that lessees do not receive any compensation for the unexpired portion of the lease if the Department takes over their land. This matter has been clearly explained to the lessees. If I were to discuss this matter in any detail here, I would need to make a lengthy statement. I do not think this is necessary in view of the discussions I have had with the lessees.
– Will the Minister for National Development draw the attention of the Australian Water Resources Council, at its meeting next Friday, to the problem of the pollution of streams by modern insecticides and weedicides? In particular, will the Minister endeavour to arrange for the adoption of common national standards to cover this form of water pollution, and for the establishment of appropriate machinery for testing and certifying the purity or otherwise of surface water?
– Mr. Speaker, I feel that the subject that the honorable member raises is somewhat beyond the scope of the Australian Water Resources Council. However, I will have some private discussion with the various State Ministers within whose province this matter lies and see what their ideas are and what action they could take in relation to this matter.
– My question is directed to the Minister for National Development and is supplementary to that asked by the honorable member for Dawson. If the report on beef roads is confidential and will not be released to the Parliament or to the people of Australia, why has this very same report prepared by the Northern Division of the Minister’s Department bean available for perusal by honorable members in the Parliamentary Library fo.” the past six months and to people outside the Parliament who wish to borrow the report from the Library?
– My attention has not been drawn to this fact. If the report is available, it should not be. That is all I can say.
– I address my question to the Postmaster-General. He is aware of the problem of deferred telephone applications in New South Wales. I refer to a Press report which appeared at the weekend and which was said to be by a “Senior P.M.G. Official”. The report stated that the telephone installation programme has been favouring Victoria at the expense of New South Wales. I ask the Minister whether this claim is correct and, if it is, what steps are being taken or can be taken to remedy this situation.
– I saw a statement in one of the Sydney newspapers at the weekend which suggested that political influence from Victoria was causing a lack of balance in this matter between New South Wales and Victoria. The article in the main dealt with so-called February figures, many of which were incorrect. I have available to me the figures at the end of March and I would like to put the record straight. At the end of February, deferred applications in New South Wales totalled 19,243. At the end of March, the figure had been reduced to 16,666, which is a reduction of 2,577 in the month. The actual connections in New South Wales during the month of March were 13,208 and in Victoria 8,010. So there were 65 per cent, more additions in New South Wales than there were in Victoria during the month. As I have said in the House previously, there has been a real problem associated with the installation of telephones in New South Wales and we have been doing everything we can to solve the problem. In recent months, 188 officers from other States, particularly from Victoria, have been transferred to New South Wales to help meet the difficulties and an additional 44 officers, mainly linemen and technicians, will be transferred within the next few weeks to give further help.
– My question is addressed to the Postmaster-General. What has happened to the Weedon report on educational television? When did the
Minister first receive the report? Where is it now? How long has it been there? What is the cause of the long delay in dealing with it? When can the Parliament expect to receive the Government’s decision on the recommendations of the report dealing with this vital matter?
– I hope to make a statement on this matter within the next week or 10 days and certainly before the Parliament rises at the end of this session.
– I wish to direct a question to the Minister for Civil Aviation. No doubt the Minister has read numerous reports recently about the proposed introduction on a number of overseas airlines of “Jumbo” jets, which are passenger aircraft capable of carrying up to 500 passengers. I ask the Minister: If Australian airlines are interested in purchasing these aircraft, have we the facilities, such as runways and passenger terminals, to handle them?
– The Department of Civil Aviation has been following this matter very closely and is interested in the development for commercial purposes of this subsonic, large jet aircraft. Qantas Empire Airways Ltd. is actually examining the situation at present to see whether it will require this aircraft in the future. In fact, it was only a few weeks ago that the Director-General of the Department of Civil Aviation was in the United States and had an opportunity to inspect the mockup of the fuselage of the Boeing 747 - which is the aircraft referred to - and to examine the layout of the design for seating in the proposed jet, which we expect will go into manufacture in the not too far distant future. The information provided to us so far by the manufacturers indicates that owing to the type of undercarriage and the dispersal of loadings the present runway requirements for the Boeing 727 will be suitable for this so called “ Jumbo “ jet. Also, the new type of terminal facilities which we will be constructing in Sydney and Melbourne in the near future will provide for very much heavier passenger handling. We expect that with the facilities already planned we will be able to handle the large number of people that will be embarking or disembarking from the one aircraft. At a later stage new terminal facilities to be provided in Brisbane will be designed to allow expansion if this type of jet aircraft is required to operate from the terminal. The same modifications could, if required, be carried out at other international airports in Australia.
– Has the attention of the Minister for Trade and Industry been directed to a statement by the Prime Minster in which he said that trade with mainland China was done by individuals, not the Australian Government, and did not include strategic materials? If so, does tha Minister seriously suggest that the Department of Trade and Industry has no official knowledge of the huge sales of wheat and wool to China, did not sponsor them, and neither received applications for, nor approved, export licences for these commodities? Does the Prime Minister’s statement indicate that wheat and wool are not strategic materials and that so long as private individuals conduct the negotiations they are at liberty to sell any product, including war material, to mainland China?
– I shall take the last part of the question first. To suggest that any materials, including war materials, are not strategic materials - and those were the honorable member’s own words - is just sheer nonsense. Let me now take that part of the question which is not nonsense. The policy of the Government is consistent with that of all of the Western powers other than the United States of America. It is a policy that forbids the export to Communist countries of those items of trade designated in conference between the Western powers to be strategic items. Items so designated are not permitted to be exported to Communist countries. The policy of the Government is consistent with that of all the other Western powers, which have agreed that items not designated as strategic may be sold by whoever owns them and has them for sale - whether it be a private merchant or the Australian Wheat Board. The Department of Trade and Industry of course has knowledge of the sales of wheat to China.
– It encourages them.
– I am making my own statement.
– I know, but I should like to be clear on that point.
– There is no necessity for that.
– There is no necessity for it at all. The last time I stood here to discuss this matter - I think it was yesterday - I said that the policy followed by the Australian Wheat Board has always been, first, to fulfil the requirements of the Board’s traditional customers, lt is only the residue of wheat, that is not required by its traditional customers, which has been made available for sale to China. The Government does not sponsor the sale of wheat or any other item. The Government’s policy is not to prevent the sale, because none of the other-
– A bob each way.
– I have been asked for a clear statement of policy and I am giving it. The policy of the Government is, as 1 have said, that there are certain items the export of which it prevents to a Communist country and there are certain other items the export of which it does not prevent. This is perfectly clear.
– I address a question to the Minister for the Army. Does he know that his two immediate predecessors in the portfolio he now holds emphatically stated that the Williamstown rifle range in Victoria would be preserved as a venue for the Queens Prize, interstate and other important rifle shoots? I ask: Will the Minister continue this desirable policy?
– The honorable member may be assured that my predecessors’ policy will be continued in this matter.
– I address my question to the Minister for the Army. Is it not a fact that it is established practice that court’s martial are open to the public? On what authority has he given instructions to the Parliamentary Library limiting the access to the copies of courts martial proceedings placed in the Library to members only? Is he attempting to conceal the procedures of the court and its deliberations from public and Press scrutiny?
– As a general rule courts martial are open to the public and to the Press. The two courts martial in respect of which the proceedings have been laid on the table in the Library for the information of members were open to the Press. I was asked to lay these documents on the table in the Library for the information of honorable members and I have done this. I should have thought that the honorable member’s interest in this matter was to satisfy himself that’ justice had been done and not to try to achieve any particular undue publicity over this matter.
– My question, which is directed to the Acting Prime Minister, refers to a responsible statement which I think was made yesterday to the effect that the Government might consider recommending to the States the adoption of a new rule of the road providing for driving on the right hand side of the road rather than the left, ls he aware that tens of millions of dollars are being spent in Sydney and Melbourne in the provision of expressways, which include fly overs and grade separations, which would not be fully efficient if the rule of the road were reversed and that, therefore, if the new rule were introduced there might be a large waste of public money running into many tens of millions of dollars? Will the Government give serious consideration to this problem, make a prompt decision and communicate it to the States? Alternatively, if the Government is unable to make up its mind, will it advise the States that in designing these expressways they should have in their minds the possibility that there might be a subsequent alteration in the rule of the road? As 1 have said, this is a matter that does involve, perhaps, very large sums of money.
– I ask my colleague the Minister for Shipping and Transport to reply to the question.
– The Commonwealth has no authority to decide on which side of the road vehicles will travel, except in its own Territories. Each year the Commonwealth conducts a conference of State and
Commonwealth Transport Ministers, known as the Australian Transport Advisory Council, where ideas such as this are often discussed. So far no proposal by any of the States, which have the final authority in this matter, has emerged to indicate that there would be the slightest willingness on their part to change the rule of the road. The Commonwealth would respect the sovereignty of the States in matters such as this.
– My question, which is addressed to the Acting Prime Minister, is supplementary to that asked by the honorable member for Grayndler. In view of repeated statements in this place by the Prime Minister, by the Minister himself and by other Ministers of the Crown that Communist China and North Vietnam are aggressors in the war in South Vietnam, will the Government now take steps to apply economic sanctions and a blockade against those countries with the same rigour and severity as such action is being taken against Rhodesia at the present time?
– An economic blockade cannot be imposed by one country alone. One can talk of a policy of this Government but one cannot talk of it as being an economic blockade of China or North Vietnam. We are in conflict with the forces of North Vietnam and with forces being supported by North Vietnam. No goods whatever are permitted to go to North Vietnam.
– Only since a few months ago.
– That is true. We sent forces to the area only a few months ago. To my knowledge, no country other than United States of America has refused to sell foodstuffs and non-strategic items to China. The only outcome of Australia’s refusing to sell some items to China would be that those items would be bought by some trader and sold to China at a profit. The Prime Minister has stated the simple facts of the situation. If we did not sell to China goods which other countries are willing to sell to her, our goods would get there just the same through other sources.
– I address to the Minister for External Affairs a question relating to difficulties for Australia which arise from the confused defence situation between Singapore and Malaysia. Was the Minister able to discern any move to solve the defence problem in this area? Are other nations attempting to use their influence to bring about a solution? If not, will the Minister use Australia’s influence to solve the defence problem between the two countries, as the finding of a solution might be vital to the interests of Australia in due course?
– The difficulty to which the honorable member refers arises from the fact that Australia’s original defence support to Malaysia was given when the Federation was intact and before the separation of Singapore from Malaysia. That separation having taken place, we have to recognise it as a new element in the situation, although our own national interests and our desire to support other members of the Commonwealth mean that we wish to help the security of both the new Malaysia and Singapore. Unfortunately, in order to be able to do that most conveniently, it is necessary for us to wait for defence arrangements to be worked out between the two countries in accordance with the undertakings given at the time of the separation agreement. So far as I am aware, no such defence arrangements have yet been concluded between the two countries. We are sincerely hopeful that they will be concluded so that our own relationships with the two countries can be simplified. Of course, these matters primarily are not matters in which we are concerned. They are, in the first instance, matters as between Singapore and Malaysia and in the second instance, as between Singapore, Malaysia and the United Kingdom.
– I ask the Acting Prime Minister whether the concessions that were extended to servicemen of the First and Second World Wars and in Korea under the War Service Land Settlement Scheme are to be granted to those servicemen who are now serving overseas in clearly defined areas. If not, why not?
– I do not feel that 1 can give a comprehensive and necessarily accurate reply to that question. I will treat it as being put on notice and will supply the honorable member and members of the House with a complete answer.
– Is the Minister for
National Development aware of the great concern of irrigators and others at the increasingly dangerous level of the salt content of waters from the River Murray? As the Minister is Chairman of the River Murray Commission I ask: What is being done by the Commission in an endeavour to overcome this problem? If nothing is being done in this regard will he make investigations with a view to promoting some action?
– I am aware of this problem, which appears to be a growing one, and as Chairman of the River Murray Commission I have taken part in some discussions on this matter. However, I feel that I should obtain a full reply for the honorable member and let him know what action is being taken. One of the difficulties is that the only way at present to keep the salt level down is to increase the amount of water made available from the storages in the upper reaches of the river. It is difficult to do this at a time like the present when these storages are becoming very low and there are restrictions on the use of the water. However, I will see that the honorable member receives a full reply.
Bill returned from the Senate with an amendment.
Debate resumed from 20th April (vide page 979), on motion by Mr. Howson -
That the Bill be now read a second time.
– Is it the wish of the House to agree to the suggestion of the Minister? There being no objection, this course will be followed.
These Bills are of considerable significance in that they provide for the customs changes that are necessary to bring into effect the free trade agreement entered into by the Australian Government and the New Zealand Government this year. The changes that are made and the commodities that are included are not of great importance to the economy of Australia in total. Most of those that might be significant are, in fact, excluded by Australian request - such items as dairy produce, lamb and mutton from New Zealand - or are subject to quota restrictions in New Zealand. In fact, this is a beginning of improved trade between Australia and New Zealand, but it is not a major widening of trade nor an intensification of trade in those areas that might have significant effects on the economies of the two countries. In addition to giving effect to these changes the Bills also give effect to tariff changes that are being introduced as a result of recommendations made by the Tariff Board and reflecting substantially those changes in respect of woven cotton fabrics and bed linen, woven man made fibre fabrics, pigments and colour lakes, tinned iron and steel hoop, strip, plates and sheets, magnetos and parts, and changes that are being given effect to because of the reports of the Special Advisory Authority on continuous filament polyamide raw yarns, woven fabrics of glass fibre and polyethylene monofil and rope.
The Opposition does not agree with the Government in respect of all these matters. It opposes the reductions that are taking place in furtherance of the trade agreement with New Zealand in the case of pig meats, cheddar cheese, peas and beans. We are opposing the change to a uniform ad valorem tariff in the case of woven man made fibres. The reasons for the Opposition’s action in respect of the New Zealand trade agreement items are that we believe that despite the limitations in the case of cheese, and particularly in the case of peas and beans, the increased import that is likely to take place from New Zealand can be, and is almost certain to be, harmful to the producers in certain parts of Australia. These are areas where it will be difficult for producers to change to some other line of production and where, because of the lack of opportunities, the difficulties will be hard to overcome. We believe they pinpoint the kind of difficulty that is present in any extension of trade by agreement with another government and that any Australian government is likely to face. We believe that steps should be taken before such agreements are carried into effect for consultation between producers who are likely to be adversely affected by them so that the producers will have time to transfer to some other line of production or that financial assistance can be given to them. Not sufficient has been done to overcome these problems. In many places producers will be in considerable difficulty as a result of increased imports from New Zealand.
The Opposition, therefore, is going to vote against the introduction of such changes in respect of these items - bacon and ham, cheddar cheese, peas and beans - as the legislation provides. There is one other item about which the Opposition is not satisfied. There are proposals for the introduction of a uniform ad valorem tariff in respect of man made fibres as a result of the Tariff Board’s report dated 6th August 1965 on this subject. Upon examination it is apparent that there is a difference of opinion within the Tariff Board on this matter. One member of the Board has submitted a minority report. It seems to us that not only is there a difference of opinion within the Board but also that the Minister has accepted that these changes will have a significant effect on the industry. I do not think this is a view that the Board accepts. I suggest that there is a significant difference between the views of the Minister and one member of the Board on the one hand and the Tariff Board itself on the other. In its report on woven manmade fibre fabrics the Board stated -
The Board considers that the industry would now be best served if it was assisted by a common ad valorem level of protection. This type of duty would tend to equalise the competitive opportunities of the various local producers. It would also provide a more economic context for production in that each firm’s pattern of production would be determined primarily by considerations of productive efficiency rather than by substantially differing duties on imported products of different values. A common ad valorem tariff would also provide a somewhat greater opportunity for the industry should its competitive position improve.
It seems to me that the Board is considering this change apart from its consequences on the whole industry. It report’s further -
It will in consequence recommend that level of protection most likely to secure for the local industry ils present proportion of the market.
Is this an ad valorem tariff? What the Board seems to be saying there is that when this uniform ad valorem tariff is applied, the industry will be able to maintain its present proportion of the market. Of course, that is not what the member submitting the minority report said. He said - in recommending an ad valorem duty in lieu of the specific rate, the Board could bring about market and production re-orientation diametrically opposed to that which at present exists and which has been promoted deliberately in the past through a tariff designed to direct the efforts of the industry toward an area where the longest production runs are available, and where, as a consequence, the most satisfactory cost levels can be obtained.
Judging by the minority report, this change will have a substantial effect on the structure of the industry. If this is so it may lead to a decline in the industry. In his second reading speech the Minister for Air (Mr. Howson) went even further than did the member of the Board making the minority report. The Minister said -
The Board’s recommendation on man-made fibre fabrics would have far-reaching effects on the local industry. It would reverse the former pattern of protection which had been in force for some years and which encouraged local production of the lower value fabrics - for which long runs are available - and discouraged manufacture of the higher priced materials.
Apparently, there will be a significant change in the industry as a result of this change in the tariff. Apparently, the industry will be moved out of the area of operation in the lower value fabrics where long runs are available and where, therefore, one would expect decreased costs to be more likely to be present, into one where higher priced materials will be produced, in which long runs are not as likely and in which lower costs are not’ as likely. This seems to me to be a strange and remarkable contradiction. Consequently, the Opposition is not prepared at this stage to accept what has been proposed. It is not that we are sure that the proposals will be against the interests of the industry; it is that we are not sure that they will be in the industry’s favour and there is a probability that a considerable amount of harm will be done, leading to a decline in the industry.
Nine companies, employing more than 2,400 people, operate in the industry. Most of the workers in the industry are adults and most are males. In the present circumstances, we do not think we are justified in agreeing to a change that is likely to endanger the employment of those people and undoubtedly the changes in the structure of the industry as described by the member of the Board submitting the minority report and by the Minister could have this effect. So we will vote against the proposals in respect of woven manmade fibre fabrics.
– Will this be in the Committee stage?
– Yes. The Tariff Board has reported also on woven cotton fabrics. Here, the Opposition is in some doubt about the changes that are proposed. Those in the industry with whom we have been in touch are processors of these fabrics. They make them into garments. Their attitude is that they would like to get imports cheaper than they can get them with the tariff proposed. They argue that if this tariff becomes law and if imports are kept out, they will not be able to obtain in Australia the materials that they want. In effect, they say that the tariff will protect something which, to their knowledge, is not produced in Australia. If this is so, the only sensible way to deal with the matter, if the tariff goes through, is to allow these people to benefit from imports under by-law. Later in the debate the honorable member for Bendigo (Mr. Beaton), who has looked closely into this matter, will have something to say about it.
The only other thing J want to touch on arises out of some of the tariff legislation proposed here and out of something which continues to crop up under existing legislation, namely the concern of the Government with dumping. A number of countries with Communist governments as well as a number in other parts of the world, operate in ways that are different from that of established business practice in western capitalist countries. Because of increased efficiency - this applies particularly to Japan, which is not a Communist country - they are able to produce goods that may be sold at prices lower than some competing imports or lower than Australian producers can manage to produce them. Sometimes, these goods are imported in sufficient quantities and at such low prices as to set up the presumption that they are being exported at less than the cost of production; in other words, that they are being dumped. What happens then is that somebody in Australia complains and the importer is sometimes notified and required to give securities in respect of some dumping duty that may be imposed upon him. Often these ‘ importers are in business in a small way. They cannot afford too much leeway in respect of the selling price of the goods they have imported. I know of a number of cases in which an Australian importer has imported goods from one or other of these countries. The goods have actually arrived and have been priced on the basis of the information available to the importer, who was not at any time aware that there was any possibility of dumping procedures being involved. In some cases the goods have actually been sold at the price decided upon by the importer and then the importer has been told that he must provide a certain amount of security to cover possible dumping of these goods. An inquiry has then been held. In a number of cases that I know of the inquiries are still proceeding, but there is a distinct possibility that the importers will be required to pay dumping duties on goods that they imported without having any knowledge that dumping was a possibility.
I think the procedure is most unfair. I believe that when the Government is satisfied, on advice from its officers, that dumping has taken place it is justified in imposing a duty, but only when the importer has had fair notice that such a duty is to be imposed. Any duty that is imposed in respect of something that happened before such notice is given is most unfair and unjust. What I am suggesting to the Minister in this general criticism is that sometimes the procedure works too bureaucratically. Sometimes there is not sufficient willingness to communicate, particularly with the small people. Communications are much better in the case of some of the larger people, who have full time officers on their staffs or in their associations whose job it is to keep in touch wilh the Department. This lack of contact or lack of liaison in the case of some of the smaller business people should be taken into account.
– Has the honorable member any particular items in mind?
– Yes, I have been in touch with the Department in respect of one matter concerning an importer of shoes in Richmond and Hawthorn. The name of the owner of the firm is Bloom. I am still in communication with the Department in respect of that matter and an inquiry is still proceeding. I also know of a number of other cases which I have not handled personally.
I do not intend to delay the House any longer. The Opposition will move amendments to express its decisions with regard to the New Zealand-Australia Free Trade Agreement items, and also the man-made fibre items, at the Committee stage. We think it will be necessary for us to consult some departmental officers before deciding the best way of giving expression to our intention, and at the same time obviating the necessity for the House to vote on too many occasions. That is all I want to say at the second reading stage.
.- I want to make it plain, first of all, that at the Committee stage I will be dealing with some of the matters that the honorable member for Yarra (Dr. J. F. Cairns) has mentioned As the House knows, we are discussing a pair of bills, one of which deals with, I think, about 560 items. This is a complicated procedure. I would like to pay a tribute to the officers of the Department of Customs and Excise for the helpful way in which they have set things out. I do not suggest that they have made everything crystal clear to me, but I will be able to follow everything reasonably well from now on. I presume that the large document containing the delineation of the items will be the working document for the Committee stage.
I will be happy to take up with the honorable member for Yarra at the Committee stage some of the comments that he has made. I think it will be better if I do so at that stage. But I would like to support his plea for a more sympathetic attitude towards some of the problems involved in the dumping legislation. There are, as he says, a great number of importers who buy goods without knowing or even suspecting that those goods are being sold at dump prices. It is pretty hard on these importers, when they get goods here, to be suddenly presented with a demand for the payment of dumping duty. I do hope that the Department will look at this aspect of the matter with a more sympathetic eye than 1 think it has done in the past.
My main reason for rising was to discuss the general principles on which a great many of these tariff alterations are made. Some of them, as the honorable member for Yarra said, spring from the New ZealandAustralia Free Trade Agreement, but others of them spring from Special Advisory Authority reports and Tariff Board reports. The initiation of these reports always rests with the Minister for Trade and Industry (Mr. McEwen), not with the Minister for Customs and Excise (Senator Anderson). The Department of Customs and Excise takes action to carry out the wishes of the Government in this regard, but the policy behind the Tariff Board inquiries, and behind the general methods of protection, rests with the Department of Trade and Industry and, of course, chiefly with the Minister for Trade and Industry, t was hopeful that the Minister could have been in the chamber during this debate. I realise that in his position as Acting Prime Minister he has additional responsibilities at the present time and I am not critical of him for not being here, but I do hope that he is listening on what is euphemistically called the blower and that he will be able to come in and explain the Government’s policy on protection, because I do feel that it needs to be spelt out in rather more detail than we have it at present.
– Will the honorable gentleman be good enough to indicate to the general public what he means by the blower? They do not know what he is talking about.
– I am referring to the broadcasting or amplifying system that is used here. The first matter I want to discuss at the second reading stage is the Government’s policy of protection. I know, of course, that both the Government and the Opposition believe in the protection of economic and efficient industry, but what is difficult is to arrive at a measure of what is economic and efficient. As the House knows, I am continually probing the Government’s actions to find out what the Government means by saying that it believes in the protection of economic and efficient industry. When the Vernon Committee was appointed in February 1963, one of its terms of reference was specifically devoted to the tariff. It was in these words -
The effect of customs tariffs and other forms, direct and indirect, of protection on the disposition of resources and on the broad economic objectives quoted above.
I in particular, and, I think, the House in general and the country, awaited the Committee’s report with interest, hoping that at last the actual meaning of “economic and efficient “ would be spelt out, and we would be given a guide line to follow. We hoped for general principles to be laid down. When we found that the members of the Committee were people particularly capable of giving a judgment on this question most of us looked forward with confidence to the answer. After all, the chairman, Sir James Vernon, is one of the captains of big industry in Australia. Sir John Crawford was for many years the Secretary of the Department of Trade and Industry, dealing on a day-to-day basis with problems posed by the question that we hoped the Committee would answer. Professor Karmel was recognised as one of the foremost academic economists in the country. He has often been asked by the Government to do all kinds of awkward jobs in awkward situations, so the Government evidently holds him in high regard. Mr. Molesworth has been prominent in the shipping trade and Mr. Ken Myer has had a very wide and deep experience in commerce.
We all expected great things of the Committee’s report when it came to hand, particularly in respect of tariffs. I believe that generally we were not disappointed - I certainly was not - when the report was received last year. At the time, the Prime Minister of the day gave it a fairly cold reception, but it is interesting to note that since then the Treasury has been responsible for several White Papers setting out with great skill the Treasury position. The present Treasurer (Mr. McMahon), after taking up his new post this year, faced up to his new responsibilities also and spelled out where the Government stood. There were two solid chapters on tariffs in the Vernon Committee’s report and it is extremely disturbing to find that the Government has not yet made a statement on how it regards these two chapters. I consider that in fairness to the Parliament and the country generally such a statement ought to be made. The Government should spell out its opinion of the chapters on tariffs in the report, and in view of the recommendations made should state whether its policy of protection will remain the same as it has been.
I have stated in previous debates, Sir, that I consider that the Vernon Committee’s report bears out the general line of criticism that I have adopted on this subject. I am sure that honorable members will be relieved to know that I do not intend to go through it all again, though I propose to take the opportunity to quote again some of the passages from the report that I have quoted before. They state a clear line of thinking which I believe ought to be stated again. I cannot help saying, rather sourly, that when I have stated this line of thinking in the past I have been criticised as being a little Australian. I do not consider that this kind of criticism should be levelled at the members of the Vernon Committee. The first of my direct quotations from the report is as follows -
A strong, although in our view unwarranted, presumption is gaining ground, that an industry, once in existence, should be protected and that, once protected, should continue to receive the protection it needs, even if its cost disabilities rise to high levels.
I repeat: I have said this kind of thing frequently in this House and it has not seemed to carry much weight. I believe that, coming from the Vernon Committee, it will carry much more weight. The next passage from the report that I wish to quote is this -
So much is said about the role of manufacturing in sustaining population increase that, as it was put to us, we may become mesmerised by the thought of bigger and better factories as the only source of future employment. Manufacturing is not the only source of employment; indeed, it employs at present only 27i per cent, of the work force, and it may become less important relative to tertiary industries . . . Moreover, protected industry accounts directly for only about IS per cent, of the work force and we should not, therefore, exaggerate its significance . . .
Here is another quotation on the subject of employment -
We would also stress that, if policies of protection are such as to divert skilled labour away from industries with sound opportunities for expansion to less economic uses, they will damage national productivity. The tariff must not be regarded as an instrument for creating employment of this kind.
The House has heard me frequently on this subject. I do not say that I am right. What I say is that the Vernon Committee seems to think the same as I do. The Committee, after discussing the question of general cost disability, stated -
If the concept of a general cost disability experienced by import competing industries, as we have discussed it in Chapters 13 and 14, is accepted, the aim of tariff making should be to encourage those industries which either have a proven disability less than, or not greatly in excess of, this general disability or which have prospects of reducing their disability to this level. Others should not be encouraged.
I repeat: These are not my phrases. They come from the report of the Vernon Committee. I have read these four quotations again because I want them included in the “ Hansard “ report of this speech as I consider that they set out the difference in thinking between the Committee and the Government in relation to tariff policy. I do not expect the Minister for Trade and Industry to agree with me. Perhaps I do not loom very large in the scene, but the Vernon Committee looms large in both reputation and performance. I repeat that the Government - through the Minister, I presume - has a duty to the country and the Parliament to spell out where the Government stands on this issue as did the Treasurer in other respects earlier this year.
I now leave the views of the Vernon Committee in relation to the principles behind our tariff policy to deal briefly with some of the particular problems of the operation of the Tariff Board system. On 19th April, there appeared in the “Australian Financial Review “ an article under the heading “Should the Tariff Board be abolished?”. I think we all know, Sir, that this journal carries considerable authority in this field. I find that its opinions, particularly on tariffs, are always perceptive and responsible. So I believe that the criticism that it makes deserves attention. But before we examine the question, let us ask ourselves: Why have a Tariff Board at all? As I see the situation, there are two main reasons. One is that the Board insulates the Government against the electoral pressures that would arise if particular industries in particular electorates were pressing for tariff protection. But I emphasise that to insulate the Government effectively, the Board must operate impartially. To do this, it must be truly independent and must also appear to be so. The second reason for having a Tariff Board is not because it is an expert body, although it’ acquires some expertise and surely needs more as the economy becomes more complex, but because, as an independent body that hears sworn evidence in public, it exposes the facts and opinion to public scrutiny. That the Board is necessary to fulfil these functions is not argued. What is argued in the article in the “ Australian Financial Review “ is that the way in which the Board is being used now raises doubt about whether it can fulfil these functions adequately.
My chief concern is that the independence and the integrity of the Board, and the appearance of independence, are at risk. They are at risk for several reasons. The first is the way in which the Board is constituted. At present, it is made up of eight members, five of whom come from the private sector of the economy, and three - the Chairman and the two Deputy Chairmen - from the Department of Trade and Industry and the Department of Trade and Customs. Sir Leslie Melville, who was previously Chairman of the Board, was an economist from the academic world. None of the four departmental men appointed since Sir Leslie’s departure have been trained economists. This is surely a great pity. I am more concerned, however, about the way in which the system of appointment works when these men are drawn from and return to the Department responsible for formulating and administering tariff policy.
Let me give a particular instance. On 30th October 1963, the Minister for Trade and Industry referred the chemical industry to the Board. I shall deal in more detail later with the particular terms of this reference. At the moment, I content myself with saying that they were unusual. Mr. Callaghan was at that time in charge of the section of the Department that drew up the terms of the reference. On 10th July 1964, he was appointed to the Board. He sat as Deputy Chairman with Mr. Cossar and heard the evidence in the chemical industry inquiry. Mr. Callaghan and Mr. Cossar were the only persons who sat and heard this evidence. Mr. Callaghan has now been taken back into the Department of Trade and Industry as head of the secondary industries section. Last week or the week before, it was reported in the Press - I think it was in the “ Australian Financial Review “ - that the Board had signed the chemical report and that the document was on its way to the Department of Trade to be welcomed, no doubt, by the man who drew up the reference, sat on the inquiry, and signed the report.
In my opinion, this is just not good enough. I have no criticism of Mr. Callaghan as a person, but I submit that no person can go from the Department of Trade and Industry then return to it in this way, and keep an independent point of view. He must be involved with the outlook of the Department of Trade and Industry particularly when he knows or he thinks that his long term future lies in that Department. He would be a rare person if his outlook was not coloured by his past experience and future expectations. Even if this was not so, even if Mr. Callaghan was a perfect person above all human frailties, it is inevitable that not many people, not all people, would believe this to be so. In tariff making, as in other grave matters, it is important that not only should justice be done but also justice should appear to be done.
The objectivity of this report when it is presented must at least appear to be questionable. It cannot help but appear to be essentially a Department of Trade and Industry document rather than a traditionally impartial Tariff Board report. For my sins, I have read all the public evidence in this case and, Sir, this was no small assignment, believe me. The pile of evidence is almost a foot high. But I thought the inquiry was of particular importance. It will be very interesting to see what the results of this inquiry are. The question at issue is the way in which they are treated by the Government for not only are the major costs of the whole economy, and particu larly the export side of it, involved, but also the basic value, both to the Government and the country, of the Tariff Board system; the independence and impartiality of the Board are at risk. I repeat it is important not only that justice be done but also that justice appear to be done. I doubt whether justice can be done, and certainly it cannot appear to be done, under this system of shuffling men backwards and forwards from the Department of Trade and Industry to the Board and back again. This is my first cause for concern about the independence of the Board.
The second and allied cause for concern regarding the independence of the Board arises from some of the terms of reference that the Minister has sent to the Board. The usual terms of reference - we all know what they are; we have seen them many times - ask the Board to find out whether assistance should be given to an industry and, if so, in what form. But in the case of automobiles and automotive components, industrial chemicals, aluminium and synthetic fibres, the terms of reference were couched in such a way as to say that the Government wanted the industry - and in the case of the chemicals, to ensure its profitability - and the Board was not asked to decide whether the industry was economic and efficient but simply was asked to say what form assistance should take. This means that the decision on the economy and the efficiency of the industry is taken by the Department and not by the Board. If this does not affect the powers of the Board and, in consequence, its ability to act independently and impartially, I just do not understand the meaning of words.
The third way the independence of the Board can be threatened is by the statement made by the Minister for Trade and Industry on 17th October 1962 when he said that the Tariff Board was expected to keep within its sights statements made by Cabinet Ministers from time to time. I have often expressed concern about this statement, first for its obvious implication that the Board is to be influenced by the Government, and secondly because no one quite knows which statement by which Cabinet Minister the Tariff Board is expected to keep within its sights. I have asked the Minister for Trade and Industry whether he will identify which are the statements 60 that the Board and the public can be left in no doubt as to which they are.
The fourth threat to the independence of the Board -I have often dealt with this matter in the House - is the implications of the effect of the activity of the Special Advisory Authority. This is not as serious as it was earlier on when the Special Advisory Authority was making many more inquiries than it is now. But the danger is always there. The Vernon Committee specifically recognised this fact. Unless the Government is careful not to refer matters back to the Special Advisory Authority from the Board and back again as has happened, then the danger will continue to exist. That this still goes on I will show in Committee.
These are the main reasons why I and many others are concerned about the reputation of the Tariff Board and why the “ Australian Financial Review “ asks the question: “ Should the Tariff Board be abolished? “ 1, of course, think the Tariff Board should be retained, cherished and encouraged. That the Vernon Committee agreed with this view there is no doubt. So this is another direct question I ask the Minister for Trade and Industry through the Minister for Air (Mr. Howson) who is sitting at the Table. Will the Minister for Trade and Industry do what he can to dispel my disquiet about the essential integrity and independence of the Board without which it cannot function other than as a cypher, in which case it should be abolished.
I wish to make one or two comments on what may be called the administrative arrangements surrounding the imposition of particular tariff duties. As we all know - and, I suppose, we are all agreed on this point - in certain circumstances particular branches of Australian industry require to be protected. The whole history of tariffs has surrounded that important question. Nevertheless, it seems to me that in some respects the operation of a particular duty is the result of the activities of a two headed animal; that is to say, the operation arises through separate action in two Departments. The Departments I refer to are the Department of Trade and Industry, which has to deal with regulating trade, and the Department of Customs and Excise, which is the actual taxing authority or the body responsible for the application of the particular duty.
My colleague, the honorable member for Yarra (Dr. J. F. Cairns), referred to instances which had come to his attention. I want to quote two cases, without mentioning names, to indicate the kind of problem that can occur. As I see it, sometimes there is a gap between the time when an Australian industry makes application to the Department of Trade and Industry in respect of a part of its activity that it claims is in need of protection and the application finally by the Department of Customs and Excise of the duty, or the dumping provision, or the by-law admission, as the case may be, at the other end of the transaction. One of the cases that was brought to my attention concerned a comparatively small importer of a rather remote sort of chemical product. I am afraid that 1 could not even pronounce the name of this product. The shipment came from Canada. It is perfectly true that, in this case, duties had been imposed against the admission of this chemical from other countries with the exception of Canada. Therefore, even though no duties had been placed on imports from Canada, it may have been presumed that relying on imports from Canada would be a bit hazardous. Nevertheless, one shipment was made and orders were obtained for a second shipment. Somewhere between the time of the placing of the order and the receipt of the goods in Australia, a dumping duty was imposed on the product. The representations that have been made to me by the aggrieved person show that he went to the Department of Customs and Excise and was assured that, as far as the Department knew, he would be secure in making the second shipment. But unknown to him, and also unknown to the Department of Customs and Excise, the Department of Trade and Industry, following representations made by an Australian industry, was in process of taking action to block any further imports from Canada.
I do not dispute that there may have been some rights on one side and not all the wrongs on the other, but it would seem to me that there is a need to establish better co-ordination of the activities of the Departments than seems to exist now. The gentleman who approached me is an importer in a relatively small way. The shipment concerned may have been of the magnitude of $A10,000 or $A 12,000. The imposition of the duty would increase the selling price by perhaps $A5,000 or $A6,000. The higher price would make it impossible for the importer to sell except at a loss, and he is faced with the possibility of bankruptcy. I doubt whether the Government’s intention is to bankrupt small importers. As far as I can understand, the representations to the Department of Trade and Industry to prevent imports were made by Imperial Chemical Industries of Australia and New Zealand Ltd. This firm can hardly be called a small entity, and it surely could not be argued that the destinies of the firm in Australia would be seriously affected whether this shipment came into Australia or not. 1 have taken this matter up with both the Minister for Customs and Excise (Senator Anderson) and the Minister for Trade and Industry (Mr. McEwen). It seems that there is a limit to what one Minister can do once another Minister has made a decision. The taxing authority or the authority that finally settles the rate of duty is the Department of Customs and Excise, but it seems that a decision to keep goods out of Australia in the interests of an existing Australian industry is made by the Department of Trade and Industry. It may be that one Department does not really know what another Department is doing over a course that can run as far as several weeks. That is understandable, but this poor gentleman is jammed in between, and the effect of being jammed may be his ultimate bankruptcy. Whether anything can be done in this case, 1 do not know, but I suggest that it is not the only case that has arisen and it may not be the last, lt seems that there ought to be better liaison between the two Departments than there is now and there also appears to be a need for some machinery of an arbitration character so that a person who feels he is aggrieved will have some place to argue his case. At the moment we are being pulled between two Departments. Personally, 1 do not criticise the decision taken by either Department; all I suggest is that the juxtaposition of the decisions and the way in which they were taken has had unfortunate repercussions. As far as I can see, the misfortune falls rather drastically on one person and the possible benefit to a particular industry in Australia, as a result of the decision, is so minute that it is certainly outweighed by the injustice that has been done to the importer. I ask that the two Departments take some counsel about this kind of operation in order at least to prevent it occurring in the future, lt should be possible to find some way of acting without destroying the importer. That is one sort of problem.
Another problem that seems to arise is this: Certain industries in Australia claim that, given the opportunity, they can develop a particular product in Australia and therefore a duty should be imposed on the entry of a similar product from overseas. It seems that there can be a gap in time. Industry A in Australia says that in a certain period of time it can make, let us say, a special cloth of a certain fineness, a certain paper product of a given weight or quality, a type of luminised foil or some other product. On the other hand, industry B in Australia, an importing industry, finds that its imports are suddenly chopped off. There is a gap between the shutting off of the imports and the manufacture of the product in Australia. The importing industry is supposed to wait patiently until the manufacturing industry in Australia is in a position to supply the product, but it may find that its established lines of retailing in Australia have been lost. This is an example of another situation that has been brought to my notice.
We on this side of the House do not object in general to the protection of Australian industry. But it seems to me that, merely because an industry says that it may be possible to produce certain goods in a certain time, the Department should not dislocate the flow of imports. The imports should not be cut off while the local industry is in no position to meet orders for the goods. I think my colleague, the honorable member for Bendigo (Mr. Beaton), has a similar case that he will detail when he speaks. I do not want to give specific facts about the example I have mentioned, because I have taken it up with the Minister and I hope that something will be done. Nevertheless, it seems to me that, unless better liaison is established between the Department of Trade and Industry and that section of government that fosters the development of secondary industry in Australia, duties may sometimes be imposed in advance of the capacity of the Australian industry to supply a product that formerly was imported. If the duty is imposed too quickly - that is, if it is imposed prior to the development of the capacity of the Australian industry to supply the product - a well established business that is quite ready to use tha Australian product can have its flow of trade dislocated because of the gap that occurs between the promise of performance and the fulfilment of that promise by development of capacity in the Australian industry. I have had several examples of this, so it seems it is not an isolated case. It seems to point to a lack of proper co-ordination between the various parts of government that have the oversight of the ultimate protection of Australia’s industries.
We can agree about the need for protection, but I think we ought to realise that occasionally there can be these technical, administrative and other problems that are part of the process and that unless there is more co-ordination than seems to exist there can be dislocations in the normal flow of established and apparently necessary activities in Australia. I bring both these sorts of case to the attention of the Minister in the hope that discussions will take place between the officers of one ministerial department and another, or better still that there may be more co-ordination within the sections of one ministerial department than seems to exist at present.
.- The measures before the House are the Customs Tariff Bill (No. 2) and the Customs Bill, the first reading of which took place on 20th April 1966. These two measures are being debated together and therefore those who take part in the debate have an opportunity to range fairly wide over the subject matters dealt with by the Bills. I notice that the honorable member for Wakefield (Mr. Kelly) ranged very wide. He referred to the Tariff Board, the structure of the Board, its personnel and so on. I have never ceased to wonder at the apparent efficiency of the Australian Tariff Board over a long number of years. One has only to look round this Parliament this afternoon and see on the Government side of the House six members and on the Opposition side eight members to appreciate that there are not many complaints reaching the representa tives of people who are affected in an economic sense by the operations of tariffs. I represent I suppose one of the largest industrial areas in Australia. It is an area whose industries are to a large extent dependent on an adequate measure of tariff protection. On the other hand I represent also a substantial number of primary producers who frequently protest about the adverse effect on them of tariffs granted to secondary industries.
The apparent lack of interest in this Parliament indicates to me that there are very few protests from people outside, and that as far as the electorate is concerned the Tariff Board does a very efficient job indeed. Of course, it may indicate also that the secondary producers who are the direct beneficiaries, and their employees, the wage and salary earners - but particularly the employers - are making more out of tariffs than they are entitled to, in an economy where, up to date, the Commonwealth Parliament has provided no brake machinery to prevent profiteering following the imposition of protective tariffs on secondary industries. There are occasions, of course, when protests do come to hand.
The items covered by the Customs Tariff Bill (No. 2) are exceedingly wide. They range over woven cotton fabrics, woven man made fibre fabrics, pigments and colour lakes, tinned iron and steel hoop, strip, plates and sheets, magnetos and parts, continuous filament polyamide raw yarns, woven fabrics of glass fibre, polethylene monofil and rope, to say nothing of those items in the tariff schedules which give effect to the terms of the New ZealandAustralia Free Trade Agreement. It is unfortunate that this Parliament recognises and follows a procedure whereby the Government can enter into a trade agreement with another country - friendly or otherwise - six months before the time, if a tariff is involved, that that tariff actually comes up for discussion in this Parliament. I find that the New Zealand-Australia Free Trade Agreement was signed in Auckland on 31st August 1965. The situation is that something was approved as long as six months ago but we are not reaching the final operation of the Agreement until today, 27th April 1966. In the interim, as frequently happens, the people who are affected may have lost interest or may be in the position where they believe that now they can do nothing effective to enable them to remove any injustices they may have suffered under the Agreement. The Minister for Trade and Industry (Mr. McEwen) is notorious for arranging trade agreements. Sometimes they have had beneficial effects upon the people of this country.
– Not always. Sometimes I believe they are mere smoke screens to make the people of Australia believe that the Minister has been exceedingly industrious. From time to time trade agreements seem to confer some enormous benefits on the people of Australia, when in actual fact on keen analysis it is found that in some cases any benefits that have flowed to the people would have flowed in the absence of agreements for which the Minister has been responsible.
Let me now get back to the New Zealand-Australia Free Trade Agreement. 1 desire to refer to the schedules that affect in particular the manufacturing section of Australian industry and also the primary producing section of our industries. Under the Agreement certain quantities of New Zealand cheddar cheese can come into Australia under more advantageous conditions than previously obtained. We understand that imports of New Zealand cheddar into Australia shall not exceed 400 tons per annum for the first and second years following the entry into force of the Agreement, 800 tons per annum for the third and fourth years following the entry into force of the Agreement, and 1,000 tons per annum for the fifth and subsequent years following the entry into force of the Agreement. The schedule goes on to provide -
Within the limits imposed by sub-paragraph (i) of this paragraph the Member States shall review annually the operation of this arrangement. In any such review arrangements may be made for -
export restraint by New Zealand.
suspension of the increase in the amount of imports provided for in subparagraph (i) of this paragraph, and/ or
emergency protective action if imports prove to be disruptive.
That is all very fine, but the anomalous situation exists where the Australian dairy industry produces a substantial quantity of cheese in excess of the home consumption requirements. Surely it is anomalous to agree to admit cheese manufactured in New Zealand - 1,000 tons per annum, eventually - on advantageous terms in the knowledge that, if the consumption demand remains the same, we will be required to export an additional 1,000 tons of cheese to a market in another country. Surely this is a hollow and fantastic gesture that will mean little or nothing to New Zealand. Yet it will create a considerable disability for Australian primary producers because, under the prevailing economic conditions, in respect of every pound of butter fat used in the manufacture of cheese or butter for export at the present low world price, the stabilised price in Australia is reduced.
– Surely this is the first time we have had quantitative restrictions on imports of New Zealand cheese.
– I do not intend to argue whether this is the first or the last time. It is claimed on behalf of the New Zealand primary producers that the arrangement by which they will export 1,000 tons of cheese to Australia will provide a distinct advantage to them. The Minister for Trade and Industry claims that the provision will not be to the disadvantage of the Australian primary producer. Perhaps the honorable member for Robertson, who may not accept my opinion that it will be a distinct disadvantage to the Australian economy and to Australian dairy producers, will take some notice of opinions expressed by men who are prominent in our dairy industry. I shall now state some facts - or opinions, if the honorable member prefers me to use that term. On Friday, 10th September 1965, there appeared in the New South Wales issue of the “ Primary Producer “ an editorial with the heading, “ Federal Government fumbles interests of dairy, pig men , “ The article read -
The Australian-New Zealand Trade Agreement was inevitable - indeed there are many circles maintaining it should have been accomplished Much earlier than the current date.
However, it now transpires that just as inevitable as the agreement had to be, it is patently clear that the dairy industry and its associated industry - the pig industry - would be committed to bear a greater share of the cost of the agreement than these industries can economically afford.
That is the opinion of an authoritative spokesman for the dairy industry. In the
Australian “ Primary Producer “ of 10th September the Minister denied the accusation that he had discouraged dairy production and put up a case to show why he thought the Trade Agreement did not dis.courage production. In the Melbourne “’ Age “ of 25th August 1965, under a heading “ Dairymen protest over entry of New Zealand products “, the following appeared -
Australian dairy farmers have made their first major attack on the recent Australia-New Zealand Trade Agreement decisions to increase imports of New Zealand cheese and pig meats.
The Australian Dairy Farmers Federation-
I am sure that the honorable gentleman does not deny that that is a representative body - has made what it describes as the “ strongest possible protest “ to the Minister for Trade and Industry (Mr. McEwen).
It has called for re-opening of negotiations with New Zealand with the object of excluding cheese and pig meats from the Agreement.
The article proceeds in that tone to enlarge on that part of the Agreement. The “ Primary Producer “ on 3rd September - I should not think anybody would accuse this newspaper or its proprietor of being a Labour sympathiser or supporter - under the heading “ Trade agreement threat to dairy farmers’ living standards “ published this item -
The Australia-New Zealand Free Trade Agreement was a threat to the standards of living of thousands of Australian dairymen, President of ,he Australian Da ry Farmers’ Federation, Mr. C. S. J. Conroy, said in Brisbane last week.
I must agree that the Agreement is a threat and that inevitably, though perhaps in a minute manner, it must reduce the ultimate net return to the dairy farmers concerned. This may apply more particularly to the pig industry than to the cheese industry. Recently in Queensland I heard opinions expressed in regard to that section of the Agreement which gives more advantageous conditions than those hitherto obtaining. In order to obtain complete information I posed the case - or excuse - put by the Minister. The Minister’s excuse always is ;hat the overall impact of the Agreement on the Australian economy and on the industry as a whole is minute, but a situation was described to me that could have severe effects. Suppose a cargo of pig meats is landed at a north Queensland port, unloaded and distributed among the meat merchants of Queensland-
– When was the last import of pig meats?
– I am not dealing with that aspect of the matter. I am stating what is feared and what it is claimed can happen. There are markets for pig meats along the coastal areas of Queensland. When it is known that cargoes of pig meats have arrived and are in the hands of the meat processors, who usually are the distributing authorities, naturally less is paid for the Queensland product. The arrival of a cargo of pig meats is somewhat disastrous to the local industry. A cargo of pig meats from New Zealand which is landed and distributed in Sydney or Melbourne has a minute effect on the industry, but in some circumstances the impact on producers in some areas of pig meats can be severe. Let us consider another criticism which appeared in the “ Primary Producer “ of 8th October under the heading “ General President critical of N.Z. Trade Treaty - Minister ignored requests” -
The Australian-New Zealand Trade Treaty is a matter of the greatest concern to members of the Primary Producers’ Union and its affiliated organisation, the Milk Zone Dairymen’s Union, General President, Mr. Stone, told a meeting of the Primary Producers’ Union Central Executive on Thursday.
The article goes on to particularise the situation which is of concern to the dairy industry of Australia. Another product will be adversely affected by the Agreement, both on the secondary and on the primary production side. For many years Australia has been a reasonably efficient producer of peas and beans. At Orbost on the Orbost flats - I do not see the honorable member for Gippsland (Mr. Nixon) in the chamber - large quantities of broad beans are grown. These are marketed and distributed throughout the length and breadth of Australia. At Werribee in my own constituency large quantities of high quality green peas are grown. The quantities are so large now that a major secondary industry has been established half way between Melbourne and Werribee. The processing factory which has been established is, I believe, known at Frozo Food Co. Pty. Ltd. I believe that the company has some association with the Australian Tobacco Co. (Aust.) Ltd. which has invested substantial funds in the Frozo company. At this factory green peas are processed. The company not only processes peas from the Werribee district but also, I understand, sends its harvesting machines for distances of 50 or 60 miles to reap crops of peas which are taken to the processing works, treated and distributed in the southern States and even further afield. This company and its suppliers made representations to me, pointing out the adverse effect that the liberalising of the entry of New Zealand peas and beans will have upon both the producers and the company. 1 have a long letter from the Australian Primary Producers Union, Victorian Division, dated 27th September 1965. I do not want to bore the House by reading the whole of it, and I therefore ask the Minister whether he will consent to its incorporation in “ Hansard “.
– I think it rs a bit too long.
– It was only last night that one of the Minister’s colleagues agreed to the incorporation in “ Hansard “ of a letter relating to a matter no more important than this. If the Minister would like me to read the letter, I shall be only too happy to oblige. Let me read some extracts from it. The first passage states -
The growing of peas and beans for processing is located in areas peculiarly suitable to their production and alternative forms of production could be either less rewarding or difficult and must involve some dislocation. . . .
New Zealand has for many years supplied the bulk of the pea seed used in Australia, and therefore should not be permitted special privileges when selling the end product in competition with local production.
In this great chemical age, we hear much about the value of applied fertilisers of all types. In days gone by, the farmer was an expert at growing nitrogen fixing crops. He planted peas and other nitrogen fixing plants to ensure that the soil would have an adequate nitrogen content for following crops. The letter continues -
The growing of nitrogen fixing crops such as peas and beans constitutes desirable farming practice-
That can never be denied -
The newly developed New Zealand process for dehydrating peas (“ Surprise “ peas) is patented by one company (Unilever).
Unilever is one of the greatest combines of the world, as everybody knows -
These peas are packed in 2 oz. cartons, but are equivalent when reconstituted to 10 oz. of frozen peas. This product is therefore not one able to be met by the Australian industry generally in full competition. Even under the present scale of duty, their advantage is considerable (and their freight advantage also)-
That is because the peas are in a dehydrated state - but if permitted duty free entry, the effect would be even more serious. The position is made worse by the fact that Australian processors generally, having just engaged in substantial capital expan-sion in the frozen produce field (over £3J million) are in no situation to develop the necessary new technique at this stage.
I repeat that that letter is from the Australian Primary Producers Union, which, so far as I know, is the most conservative primary producers’ organisation in Victoria.
– Has the honorable member heard from that organisation since that date in September?
– On the same subject?
– Yes, many times. The letter goes on -
As it is understood that the agreement itself will not be referred to Parliament for ratification-
It has to have ratification by means of this tariff schedule -
I earnestly request your support in opposing the inclusion of processing vegetables in the proposed arrangements when the matters of repealing tha present .Australia/New Zealand Trade Agreement and amending the Customs Act are brought forward for consideration.
These people will get my support. I come now to the manufacturers. The Victorian Chamber of Manufactures is a very good organisation; it is the mouthpiece of the manufacturing industries of Victoria. It frequently finds itself completely in line with the views that I and other members of my Party express - good Australian views, views supporting the development of Victoria and Australia generally. This organisation sent a letter to the Minister for Trade and Industry. I have a photastat copy of the letter.
– What is the date of it?
– It is dated 4th August 1965, and reads -
Dear Mr. Minister,
On behalf of The Commonwealth Quick Frozen Vegetables & Fruit Processors’ Association. I wish to inform you of my Association’s total opposition to any reduction in the present tariff on quick frozen peas and beans from New Zealand.
As you are no doubt aware, I was informed only nine days ago by your Department that, without prior notice, the New Zealand Government had requested that frozen peas and beans be added to the list of industries for inclusion in the proposed Trans-Tasman Customs Union which will be negotiated by you in Canberra next week.
This sudden last minute move has created grave difficulties for our Association, which is Commonwealth wide, in presenting its case for opposition to this proposal. I would, therefore, stress that the facts which are given below are indeed only part of the case which we could have put forward if we had been given sufficient time to do so.
As you know, our industry has grown very rapidly in the last decade and although our members have spent, and are spending, large capital sums on increasing production facilities, in most years demand has exceeded supply. However, the proposal for Free Trade with New Zealand has come at a time when our industry has geared itself to more than meet the demand for frozen peas and beans in Australia.
This is illustrated in the very large increase in Australian production for frozen peas in 1964/65 over the proceeding year, that is, from 33 to 55 million pounds weight - as estimated by your Department. Furthermore, our members are spending more than ever before in increasing facilities for the production and storage of frozen peas and beans.
At a meeting held today, I was informed of the following facts: -
As you are probably aware, whilst the next few years may see an expansion of the industry in the States of N.S.W., Queensland and West
Australia, the present position is that the industry is mainly concentrated in the States of Tasmania and Victoria. We wish to bring to your attention that this means the cost of refrigerated freight across the Tasman sea (35/32d, New Zealand per lb.) is in fact lower than the cost of refrigerated freight from Tasmania to Brisbane, and only slightly in excess of that from Tasmania to Sydney which is the largest single market in Australia. These rates are respectively 43/4d. per lb. and 33/4d. per lb.
We should also like to draw your attention to the recent trends in food retailing in Australia, one of which has been to concentrate purchasing power in fewer and fewer hands. Also, for our industry there has been a marked increase in sales of retailers’ “ House Brands “ and evidence of retailers setting up their own distributive organisations. It would therefore not be necessary for a New Zealand processor to set up his own distribution organisation in order to take advantage of any reduction in the tariff on frozen peas and beans from New Zealand. He could well find a ready market for his products at the expense of Australian grown and processed frozen peas and beans.
With the concurrence of honorable members, I incorporate the remainder of the letter in “ Hansard “.
We have not discussed in this letter the agricultural side of our industry, because we are aware that you have received, or will be receiving, letters from organisations representing growers of vegetables for processing in several States. We only wish to state that we wholeheartedly support these submissions.
Lastly, we also wish to lodge our objection to any move for Free Trade in a product which is produced under a world-wide patent in one country, so that it is impossible for it to be produced elsewhere. In this we refer specifically to “ Suprise “ brand dehydrated peas. In our opinion this is not Free Trade but monopoly trading.
For your information, the following companies are members of our Association and have authorised this letter:
Batlow Packing House Co-op. Ltd.
Cottees Ltd. (Cahills Quick Freezers Ltd.)
Harvester Foods Ltd.
Hunts Canning Pty. Ltd.
Kraft Foods Ltd.
I.X.L. Frozen Foods.
Peters Ice Cream (W.A.) Ltd.
Petersville Ltd. (Gordon Edgell Pty. Ltd.; International Canners Pty. Ltd.)
Sou-West Frozen Food Packers Ltd.
Frozo Food Comp. Pty. Ltd.
To the best of our knowledge, the above companies are processors of the total quantity of frozen peas and beans in Australia.
There is a sorry story to be told about this New Zealand-Australia Free Trade Agreement about which the Government boasts, but which cannot be put into operation until it is validated by the passage of the
Bills now before us. The Labour Party has been impressed by the representations that have been made to it. We are satisfied on the evidence available to us that this Agreement must adversely affect some sections of the community. It is very blase of the Government to say: “ Yes, that may be so, but over all it may be of substantial benefit to Australia “. People who are exporting vast quantities of secondary products to New Zealand are now going to get some concession, but that is not much satisfaction to the primary producer or manufacturer in the circumstances I have outlined. There was no suggestion in the announcement of the Agreement that the Government would compensate the people who will be hurt. There was no mention of a bounty, subsidy or anything else of that nature. I leave this subject for future discussion and, of course, will oppose that part of the legislation that creates th is objectionable disability for the people I have mentioned.
.- While his comments are fresh in our minds 1 should like to refer to the speech of the honorable member for Lalor (Mr. Pollard). He quoted extensively - I take it from newspapers - and said that the people he quoted would not be Labour sympathisers or supporters.
– I said that they would hardly be Labour sympathisers or supporters.
– All right, let us accept that. 1 should like the honorable member to explain why these people would not be Labour sympathisers or supporters. I suggest that they would not be Labour sympathisers because the Labour Party does not support them. The main advocate for the Labour Party in matters relating fo primary industry admitted within the last 10 minutes that primary producer unions and rural organisation newspaper writers would hardly be supporters of the Labour Party. I do not often agree with him, but he is absolutely right this time. The Labour Party policy does not assist primary industry. Nevertheless, the honorable member for Lalor said that he would support the primary producers. Obviously he thinks he has a chance of driving a wedge between Australia and New Zealand. To try to do so in the week of Anzac Day seems to me to exceed what I would call a reasonable attitude. I can see that the honorable member disagrees with me. He is either trying to drive such a wedge or he is trying to get some political advantage from what he considers to be the dissatisfaction of certain primary producers with the trade agreement with New Zealand. No two countries are more closely linked than New Zealand and Australia. They have been associated in many ways. The Minister for Trade and Industry (Mr. McEwen) supplied figures and facts to show that if there is some slight advantage for New Zealand in the proposed agreement it is so small that it could not adversely affect any Australian primary producer. The Opposition did not quote the Minister’s figures, because had it done so we would have seen the true position of what has been happening in this field.
The honorable member for Lalor said that hrs electorate is one of the greatest industrial electorates in Victoria. That is true. It takes in Sunshine and other places where harvesters and other farm machines are made and where many secondary industries operate. However, he did say: “ I have some primary producers also in my electorate “. If he depended on the vote of those primary producers for his return to this Parliament he would not be here, as the figures for the last election show.
– He is the patron saint of the farmers, who are almost unanimous in his favour.
– He would not be here if he had to depend on their vote, so he is in somewhat of a d’ilemma. The honorable member for Scullin (Mr. Peters) has been interjecting. He claims that we should protect secondary industry in such a way that if protection for another industry were given and it put one or two men out of work then that protection should be eliminated.
– That is a deliberate misquote.
– I can prove that by quoting from “ Hansard “. One or two people may be put out of work, but the Government’s action is responsible for keeping hundreds of thousands of people in work in other industries that it is supporting. I believe that trade with New Zealand should be fostered. The honorable member tor Lalor and other honorable members opposite adopted an entirely different attitude regarding the sale of Australian wheat to New Zealand years ago. I have always said that the honorable member for Lalor was not responsible for that sale. I have said that in this House and I have said it in reply to questions at public meetings throughout Victoria, and I adhere to it now. Nevertheless, he tried to excuse the Labour Government of that time and said that Australia was assisting New Zealand, which was short of wheat. His attitude is completely different today. Apparently the Opposition has lost its feeling of brotherhood for our kinsmen in New Zealand. The Minister for Trade and Industry proved that the trade agreement with New Zealand would result in little if any damage to Australia but could do good generally here. After all, surely we want to cement the feelings between Australia and our great ally New Zealand. I did not rise to speak on this particular topic, but I could not agree with what the honorable member for Lalor said.
I believe that tariffs should be used to encourage the development of Australian industry when that is practicable. It cannot always be done. We cannot encourage the expansion of an Australian industry if such expansion will have an adverse effect on other industries that will offset any advantage we might gain. I speak generally now, although I shall speak specifically later in respect of one or two industries. Where an industry is supplying a small percentage only of the Australian demand the Tariff Board is evidently of opinion that protection for that industry would not be justified as it would increase the price of the product to many consumers. That attitude is easily understood. If the industry can supply a small percentage only of the demand and we impose a heavy tariff to protect that industry, then the price to the Australian consumer increases. I have in mind an industry that could expand if it had the benefit of adequate tariff protection, but it could never expand without such protection. With protection the industry could expand to the extent that it could supply the Australian demand. If it supplied the Australian demand a dual advantage would be gained. It would result in a larger industry for Australia which would employ Australians. It would also relieve some of our overseas balance of payments problems because the goods would be grown locally - and I am talking of a primary industry - and would not have to be purchased from overseas. The problem is: How is that industry going to expand without adequate tariff protection?
Some industries have found that they cannot expand without protection and have presented cases to the Minister who has referred them to the Special Advisory Authority, which has given temporary relief. However, in respect of one industry with which I am familiar, as soon as the Tariff Board’s finding was tabled - perhaps 12 months after temporary relief was given - the situation reverted to what it was previously. The Tariff Board would not support what the Special Advisory Authority thought appropriate for the protection of the industry. That is all I shall say about this now, because I want to deal with the industry specifically later.
I want to speak briefly now about primary industry, secondary industry and tariffs. The honorable member for Lalor has spoken on this. What is the position? If secondary industry is protected to such an extent that its products are dearer than they otherwise would be, the people who eventually pay for them are the primary producers. If secondary industries are faced with rising costs of production brought about for any reason, including wage rises, all they do is change the price tag on their product. This increase in price is passed on to the primary producer. That is the end of the road, because there is nobody to whom the primary producer can pass on the increase.
The primary producer, of course, gets what advantage he can from that part of his production sold in Australia, but much of the production of our primary industries is sold on the open market to countries many of which have standards of living lower than Australia’s and which, as a consequence, pay less for the product than is paid in Australia. Of course, this Government has tried to protect primary industries as much as possible by the improvement of stabilisation schemes. But these schemes apply only to a certain amount of primary products. After that amount has been sold, the balance of our primary products are sold on the open markets of the world, usually at a price below the price obtained in Australia for that proportion of the product which is sold here. These are the problems which the Tariff Board finds perplexing, but 1 think it is doing an excellent job in trying to overcome them. Later this evening I hope to draw attention to a primary industry in my electorate which I believe should get a better deal.
.- The honorable member for Mallee (Mr. Turnbull) posed the question: Why should the farmer vote for the honorable member for Lalor (Mr. Pollard) or the Australian Labour Party? In passing I would like to answer the honorable member for Mallee. He suggested an answer to his own question. 1 ask: Why indeed should the farmer not vote for the honorable member for Lalor and the Labour Party? Going back over the years, was it not the honorable member for Lalor who introduced in this Parliament the wheat stabilisation scheme? Was it not a Labour government which introduced the dairy industry price guarantee system? The post-war wool realisation scheme and other schemes were introduced during the few years of Labour government. Nobody could say that the Labour Party when in power did not give the farmer a fair go. Indeed, the honorable member for Lalor should be the first candidate whom the farmer elects.
On the other hand, what has the farmer had from this Government since 1949? The greatest problem facing the farmer is costs. The Liberal-Country Party Government has presided during the greatest period of inflation in our history. This inflation has cost the farmer a great deal. It has squeezed him between high costs on the one hand and lowering prices for his exports on the other. It is this Government and its supporters who are responsible for the present inflation - nobody else. Honorable members opposite are the ones to blame. They should hang their heads in shame. I do not know what the Government proposes to do about inflation, lt will go on and on. People are asking where it will end. I do not know. This is a serious matter. The honorable member for Mallee may laugh about it.
Your farmers are extremely serious about it.
– Order! The honorable member should address his remarks to the Chair.
– I rise to order. I object to the honorable member for Bendigo accusing me of laughing at the situation. 1 did nothing of the kind. I was laughing at the inadequate case put up by the honorable member for Bendigo.
– Order! There is no substance in the point of order.
– Apparently members of the Country Party find humour in the situation. The average farmer does not. It is high time Government supporters applied themselves to this problem. The honorable member for Mallee said that higher protection adds to the costs of primary producers. That was the basis of his argument. Nothing was said about importing lamb or butter from New Zealand. Nothing was said about protection for the woven cotton fabric industry. The woven cotton industry opens up an avenue for producers of cotton, both in established areas and in areas such as the Ord River where, when the Government gets around to making a decision, additional supplies of cotton will be produced.
The honorable member for Lalor commented on how few honorable members were present in the chamber showing an interest in the tariff. This is the usual state of affairs when debates of this nature take place. We have present in the chamber a few of the regulars. This is a circumstance which worries everyone. I confess that it disturbs me. I think the reason is that the myriad reports coming from the Tariff Board and the Special Advisory Authority about various industries are too numerous for the average honorable member to examine thoroughly and digest. I do not say that any one report is too much for the average honorable member, but there are so many reports covering such a wide range of industries and of such complexity that the duties of most members of Parliament do not leave them time to examine all of them, and consequently members stay away from the debate. This is disturbing, because the tariff and tariff policy have a great effect on our economy and upon specific industries. Perhaps something should be done in the matter.
The blame for this situation attaches to Government and Opposition supporters alike. Perhaps it also attaches to the Cabinet itself. My understanding is that a special committee, comprising an officer of the Department of Trade and Industry, an officer of the Prime Minister’s Department and an officer of the Treasury, examines each Tariff Board report and makes a recommendation as to whether it should be accepted. Then, apparently, the recommendation goes to Cabinet. I do not think the recommendations are fully and properly considered by the Cabinet. It may be that there are so many of them and that the problems confronting the industries are so complex. Some months ago 1 took part in a debate about processed man-made fibre yarns. It was obvious to me that the Tariff Board had made a mistake. However, the Board’s recommendation was accepted willy nilly by the Government. As a result, the industry concerned sought further prolection from the Special Advisory Authority. That protection was immediately granted. Obviously the Board had been in error. The Government apparently did not consider that the Board was in error, but the Special Advisory Authority did. At the time I believed that the Government had made a mistake and I said so in a detailed submission to the Parliament. That incident was a clear indication to me that these reports and the subsequent proposals are not effectively examined by this Parliament. 1 do not know the answer to the problem. Perhaps an all-party committee could be appointed to examine Tariff Board reports and to report on them to the Parliament and certainly to each party. We should have something more than the run-of-the-mill debate that we are having now and which we have had in the past. Perhaps an allparty committee is the answer, lt could meet when the Parliament is in recess to examine and make recommendations on reports submitted by the Tariff Board. Certainly there could be a dissenting report, if necessary, from the Opposition side or the Government side. This obviously would happen in many cases, although in many other cases it would not. We do not necessarily oppose Tariff Board reports because they are accepted by the Government. We oppose them on very few occasions, and one of those occasions is today. This suggestion deserves examination. I do not know that it would be the answer, but it might well be so. At least it might give the Parliament a more effective means of examining these important maters that come before it.
– It is worth trying.
– Yes, it is worth irving, as the honorable member for Wakefield says. After all, the Parliament has a responsibility to determine whether there shall or shall not be protection, or what form the protection should take. The responsibility lies here and nowhere else. The Government may put forward the proposal but the Parliament decides on it. Consequently an all-party committee from the Parliament might be the answer.
There are two matters I wanted to speak about briefly. Unfortunately I have not had enough time to examine in detail all the matters that are before the Parliament in these Bills, but there are, as I say. two matters to which I want to give some attention. The first is that of the Tariff Board report on woven man-made fibre fabrics. The Minister said in his second reading speech that this might lead to a significant change in the industry’s pattern of production. I think it is up to us to determine whether this change is or is not a change for good. Because of what the Minister considers may be undue dislocation in the industry, the Government has given the industry time to meet this change by applying minimum and maximum rates of duty.
The proposal constitutes a direct change in tariff policy towards this section of the textile industry. Until now specific duties have been applied on these particular materials, but under the proposal now before us ad valorem duties will be applied. Why the change? This is the particular question that we in this Parliament should ask. It seems to me, after examining the report, that the purpose is to bring together under a uniform tariff both the man-made fibre fabrics and the woven cotton fabrics. I am not convinced that the interests of the two sections of the industry are the same. I am not convinced that the needs for protection in the two sections of the industry are the same. Certainly I do not think the circumstances of the two sections of the industry are similar. 1 would like to read to the House a portion of the dissenting opinion of one member of the Board, Mr. J. R. Murray. He said that the proposed rate of duty will not adequately protect the industry in its main area of production. The report stated at page 14-
M r. Murray is of the opinion that in recommending an ad valorem duty in lieu of the present specific rate, the Board could bring about market and production reorientation diametrically opposed to that which at present exists and which has been promoted deliberately in the past through a tariff designed to direct the efforts of the industry towards an area where the longest production runs arc available, and where, as a consequence, the most satisfactory cost levels can be obtained.
This outlines the policy in the past and gives reasons for it. It refers to the longest production runs and the obvious economies in quantity production, which are apparent to everyone. The report continued -
In so doing, the Board in the past has found that this could best be achieved through the use of a specific duty.
I apologise to the House for quoting extensively from this dissenting opinion, but I think it should be placed on record. The report continued -
Without taking into account the special temporary protection which is additional to the permanent rate, the duty which the Board now proposes will result in reductions in the landed costs of all man-made fibre fabrics priced below 59 pence per square yard f.o.b. The average f.o.b. price of imports under substantive Tariff Items from Australia’s strongest overseas competitor in the first 9 months of 1964-65 was 53.7 pence per square yard f.o.b. and almost half of these imports were priced below 48 pence per square yard f.o.b. Over the past three years imports from this country have been rising and are assumed to be competing with the products of Australian mills.
This paragraph is significant indeed. The report went on -
A large proportion of the output of Australian mills is sold at ex-mill prices below -
I emphasise “ below “ - 60 pence per square yard. Consequently, a superficial examination only is necessary to demonstrate the effect of the removal of the present specific rate of protection and the substitution of an ad valorem duty of 55 per cent.
He went on to indicate the substantial reductions in protection for various fabrics.
I think the arguments put forward by Mr. Murray are important arguments against the recommendations of the Board. In particular they reflect the reservations held by the Opposition in respect of this matter. We are not convinced that this quite drastic change is in the best interests of tha industry. It is a radical change and until we hear better arguments and see better evidence we oppose the broad measure.
Finally I want to quote further from Mr. Murray’s dissenting opinion -
Historically, the man-made fibre weaving industry has, for tariff purposes, been isolated from other sections of the textile industry and evidence continues to strongly support a retention of this policy.
Well, in the absence of better arguments than those already put forward the Opposition agrees with Mr. J. R. Murray that this may not necessarily be in the best interests of this section of the industry.
The other matter I wanted to discuss briefly was that of the Tariff Board report on woven cotton fabrics, bed linen, etc. There has been a change in the protection afforded to these fabrics. The particular change I am concerned with is this: Whereas fabrics of more than 4 oz. and less than 7 oz. per square yard were substantially free from protection, or attracted a duty of a penny a square yard, the delineating figure of 7 oz. has been changed to 6 oz., and a duty of 55 per cent, has been applied to fabrics above 6 oz. per square yard. This represents, of course, quite a substantial increase in tariff protection on fabrics over 6 oz. per square yard.
I support the report generally for a number of good reasons. First, the local weavers employ a substantial number of people. Secondly, the cotton weaving industry is in many cases established in country areas. It provides employment in country towns where alternative employment is very difficult or impossible to obtain. In the case of women particularly there is almost no alternative employment available. .1 consider that the fact that this industry operates in country towns is a good reason for granting protection. We should aim at balanced development and we should not let country industries fall by the wayside.
It appears to me from the Tariff Board report that this industry is relatively economic and efficient. These, of course, are the criteria followed by the Tariff Board in the first instance - and it certainly should be so. The plant and equipment installed in the majority of these weaving plants is up to world standards, and this is tremendously important.
The other reason why 1 give my support is, as I mentioned earlier in reply to the honorable member for Mallee, that the development of an economic cotton growing industry depends on two things. The first is a home weaving industry of reasonable or perhaps large size. The second is the possibility of exports of cotton. I understand that in future we may be able to export cotton to Japan and other countries from, say, the Ord River area if the Government assists in the development of the scheme there. A home weaving industry of substantial size would certainly provide a market for the cotton growers who are already established. I believe that this is a further good and effective reason for supporting protection of the industry.
The Tariff Board, in its report on woven cotton fabrics, bed linen, etc., dated 6th August 196S, as appears at page 22, dealt with the lowering of the delineating figure from 7 oz. to 6 oz. a square yard for the purpose of limiting protection to fabrics weighing not less than 6 oz. a square yard. It stated -
The Board set the division at 6 ounces on the assumption that the price differences would reflect fully the tariff differences, lt remains for the Australian producers to decide whether or not their prices in these marginal areas take full advantage of the duty recommended. To the extent that they do not use t his advantage, this substitution will decline and the 6 ounces division may provide the industry with a significant area for market development. . . .
I believe that this is important. The Board’s opinion is that the reduction from 7 oz. to 6 oz. will provide the industry with a significant area for market development. However, one particular problem should be mentioned. I suppose it is inevitable that when, as a result of a tariff review, the delineating figure is reduced from 7 oz. to 6 oz., or whatever the case may be, someone close to the market will be adversely affected.
I want to bring before the notice of the House a particular problem that has arisen in respect of a firm that manufactures dress shirts. To the best of my knowledge, it is the only manufacturer of dress shirts in Australia, though I may be wrong about this. In any event, it is certainly one of the biggest in the world. Its factory is located in a country area. The firm has some thousands of yards of special weaves on order from overseas. For fabrics of the type of some of those on order, the tariff, before the recommendations in the Tariff Board’s report were put into effect, was Id. a square yard. The tariff that will now apply to these orders will be 55 per cent, ad valorem. This represents a substantial rise, and I shall say more about it later. To take one example, the tariff on one class of material will rise from Id. a square yard probably to more than 9s. a square yard. This is a fantastic increase when one thinks about it. An increase may be necessary, but I believe that when changes in policy cause tariff alterations such as this, the position of the people who would be affected should be closely examined to determine whether they are in fact entitled to by-law en’.ry and whether they are entitled to encouragement instead of being put out of business as a consequence of the change.
Several criteria ought to be used in examining individual cases. The first criterion is the need for the material or the fabric in question. Dress shirts - the kind of product involved in the case that I have mentioned - are fashion garments. I presume. I readily admit that I am not very well up in these matters. I do not even own a dress shirt. It may be said tha; we in Australia do not need the particular kind of fashion material or fabric involved, that it is not necessary and that something else could be used. However, 1 suggest that those who should determine whether or not the material is needed are the consumers. The consumer determines for himself whether he does or does not like a particular shirt. It may be that if the particular fabric in question is not available he will buy something else. He may even buy a garment imported from overseas. The consumers are the people who ought to determine whether a particular material is needed.
Against this view, it may be argued that the Government or the Tariff Board should determine whether imports of a particular fabric should be permitted. I ask honorable members to think about this seriously. I do not believe that this argument can be accepted. After all, in the stores of the Myer Emporium Ltd. in Melbourne we can buy oranges from California, which compete against perfectly good oranges grown in the electorate of the honorable member for Mallee. We can buy honey and biscuits imported from overseas. We can buy tomato pulp and puree which come from Italy and imports of which result in Australian tomato growers and producers of tomato pulp and puree being put out of business. We have here the same sort of argument. Do we or do we not need the product in question? Apparently, complete freedom has been allowed for imports of these items which can be bought readily in the stores. Therefore, I suggest that the consumer is entitled to say whether or not he wants a particular shirt fabric. The customers of the manufacturer that I have mentioned want shirts made of the materials that the firm has ordered.
The second criterion is the availability of a particular fabric in Australia. The question that arises is: What are we protecting if we vastly increase the tariff on an imported fabric? When I first discussed the matter of these imports with the manufacturer in question, I suggested to him that he submit orders to the suppliers of similar materials in Australia and ask whether they could fill the orders. Every one of the Australian manufacturers wrote back to say: “ These materials are not available. We have no intention of producing them.” I have these letters with me. The fabric is not available in Australia and there is no prospect of the shirt manufacturer getting it locally. Indeed, it is available only in Japan and Switzerland, apparently. So this second criterion is nullified, since the required materials cannot be supplied by Australian producers. As I have said, there is evidence to show that this is so.
My time is running out and I want to move on to the third criterion. We must look at the cost to the particular industry and to the consumer. Is it justified in relation to dress shirts? I suppose that the Minister for Air (Mr. Howson), who is at the table, has a dress shirt. Probably it was made by the factory that I have mentioned.
If by-law entry of the fabrics in question is not permitted, the duty on them will go up from Id. a square yard to an average of about 9s. or 10s. a square yard. This will increase the cost -to the retailer from some 53s. to about 63s. a shirt - an increase of 10s. Is the increasing cost to the consumer justified? Again, we get back to the question: What, if anything, are we protecting?
The fourth criterion, which is of equal importance, is the loss of sales to the particular manufacturer, the disruption of his establishment and the loss of employment that are likely to occur. I particularly emphasise employment in this instance, because alternative employment is not available in country areas. I appreciate that we cannot draw the line anywhere without hurting somebody in one way or another. However, in this instance, the by-law entry procedure provides the Government with a means of softening the blow to particular industries. The firm to which I refer is Weimar Industries Pty. Ltd. I suggest that there should be no hard and fast rule applied here and that by-law entry be permitted. The increase in the cost of a dress shirt from about 53s. to approximately 63s. seems out of all proportion. The result will be disruption of the factory and loss of employment. This will be a substantial blow to the city in which the factory is situated, for there is no alternative employment there. It will be a substantial blow also to the firm. I think these things ought to be taken into account.
Generally, I support the particular Tariff Board report because overall it gives the opportunity for the extension of local weaving. But I suggest also that adequate reason exists for looking very closely at these borderline cases to make sure that no damage is done to industries which certainly do not deserve this treatment. In the last moments of my speech, I repeat the suggestion that the Minister ought to look at my proposal for the appointment of an all party committee to examine Tariff Board reports. It is quite clear that I and every other member of this Parliament have not the time to go through all of them. I think it would help us to streamline the procedures and deal with the problem we are facing if an all party committee examined the reports. Time is available for this when Parliament is in recess. The committee could go through all the reports and make recommendations upon them. I think this matter is worthy of consideration.
– I wish to mention a couple of matters. I refer first to the final point raised by the honorable member for Bendigo (Mr. Beaton) on the question of the establishment of an all party committee to go into all matters relating to Tariff Board reports before the Parliament discusses them. This suggestion could well have some merit but I think it would need further examination before it became a reality. We might well need to have a committee to look into whether the proposed committee would eliminate any work and overcome the problems the honorable member mentioned. There is no purpose to be served in just setting up a committee for the sake of it. Before he raised this point, the honorable member said also that it was of great importance that the actions of the Government and the Tariff Board, whilst they may affect a particular industry should not hurt that industry too much. It is on that point that I wish to make my speech.
The honorable member for Lalor (Mr. Pollard) said that he was opposed to three points in the New Zealand-Australia Free Trade Agreement concerning the dairy industry, the pigmeats industry and the peas and beans industry. The honorable member quoted a number of Press reports and a couple of letters from various people objecting to the Government’s action. It was notable that the reports he quoted - I think I am right in saying this - were dated about August or September of last year. None was more current than that. Since that time, two or three things have happened.
A series of questions were asked of, and a statement was made by, the Minister for Trade and Industry (Mr. McEwen) towards the end of last year. On 8th December 1965, the Minister made an important speech to the Queensland Dairymen’s Organisation. This speech received fairly wide publicity. Then, in March of this year, a full debate took place in this House on the New ZealandAustralia Free Trade Agreement. Today, the honorable member for Lalor raised the very questions which were answered at the time of that debate. The mu… point which the honorable member mentioned very briefly, and then ignored, is that in the Agreement full protections are provided for the various industries concerned. The Government ensured this when formulating the Agreement. 1 think Articles 8, 9 and 10 of the Agreement give the industry immediate recourse to the Commonwealth Government for consultations. One must not forget that the purpose of this Agreement is to promote the growth of the economies of two friendly countries which have no intention of harming each other.
The actual situation in relation to the dairy industry is that some 260 tons of New Zealand cheese are imported into Australia annually. The proposal under the New ZealandAustralia Free Trade Agreement is that this figure will be increased gradually to 1,000 tons of cheese annually. Much has been said about this proposal, lt is surprising to me that such great emphasis has been given to this matter by Victorians. I can understand some of the concern felt by the members from Queensland who spoke on this point in the previous debate. But the cost to the dairy farmers when this new figure of 1,000 tons of New Zealand cheese is reached will average only SI 6 per head per annum. Dairy farmers are receiving a subsidy at present of $490. The total cost to the cheese producing section of the dairy industry, if we have to export 1,000 tons of cheese, is estimated to be $24,000. but this is to take place in five years time when quite possibly with our growth of population this 1.000 tons - or an increase of only 700 Ions in round figures, which is less than 1. per cent, of our production - may well be eliminated. So, this proposal is not of such great consequence and, as I said before, full protection is afforded to the industry. It should be explained to the House that this is so and (hat the position is not as mentioned by the honorable- member for Lalor.
The honorable member went on to talk about the pig meats industry. He ignored my interjection to him that at present no pig meats are being imported from New Zealand because the disease, trichinosis, is present there. Before this outbreak of the disease in New Zealand, some 2,600 tons of pig meats were entering Australia. The proposal in the Agreement is to bring in only 3.000 tons of pig meats duty free. A duty would apply to imports of pig meats above that figure. Full control would be exercised over such imports. They would be controlled as other meat imports are controlled with the pig meats being sold only to processors and not on the open market. The honorable member said that prices of pig meats fell because of a fear arising out of” the effect of importation. Mention was made previously that in the September quarter of each year the price of pig meats normally falls. The price subsequently rose towards’ the end of last year. This is the normal trend. I believe that this is what has happened, as the honorable member for Riverina (Mr. Armstrong) so clearly pointed out in the previous debate.
As far as the peas and beans industry is concerned, I can only repeat what the Minister for Trade and Industry said in answer to a question that I put to him last August with regard to what would happen to this industry and the protections it was to be given under the New ZealandAustralia Free Trade Agreement. In reply to my question, the Minister said -
We took steps to consult with those people, both on the processing side and on the growing side of the Australian industry, who were able to give information. So that honorable members may see this matter in perspective, I point out that, under the existing arrangements with New Zealand, for I think seven or eight years there has been a sliding scale of duties and no duty is payable where the product is exported at a price above a certain level. In order to illustrate the degree of competition, I mention that 4,300,000 lb. of peas and beans were imported from New Zealand in the two years ended June 1964 and only £14,000 of duty has been paid on those peas and beans. There has been no disruption of the Australian industry in those circumstances.
That answer was given by the Minister for Trade and Industry on 24th August 1965, and it appears at page 323 of “ Hansard “. If there is disruption of the Australian industry, immediate protection is provided. Under the provisions of Articles 6, 8, 9 and 10 of the Agreement, the industry has recourse to the Minister. We are dealing with a friendly Government. The whole purpose of the New Zealand-Australia Free Trade Agreement is to promote the growth of this area of the world and to bring about closer relations, in harmony, between New
Zealand and Australia. I mention these matters to put the record right.
.- The House is considering tariff legislation. I am delighted that the Opposition, after long deliberations, has decided to vote against the reduction of duties on pig meats, cheese, beans and peas. I think it is necessary to refresh our minds on this subject. The honorable member for Robertson (Mr. BridgesMaxwell), who has just spoken, accused the honorable member for Lalor (Mr. Pollard) of voicing old objections. He said that the objections used by the honorable member for Lalor dated back to last September or October and that possibly the position had changed. This is not so. In the time available to me, I will acquaint the House with objections that are up to date and have been continuing ever since the New Zealand-Australia Free Trade Agreement was signed. The honorable member for Robertson referred to a statement in which the Minister for Trade and Industry (Mr. McEwen) said that he had had long discussions with representatives of the growers and processors before the Agreement was entered into. I hope once and for all to refute this suggestion and to show that the growers in my electorate, who produce 60 per cent, of Australia’s requirements of processed peas, had only two days in which to prepare a case on this vital issue and present it to the Department in Canberra.
I think it is important to look back briefly over the history of this matter. We will then see why the Australian Labour Party is objecting to the provisions of the Agreement that apply to the four commodities that I have mentioned. The honorable member for Lalor dealt with cheese and pig meats. I wish to point out again the importance of the pea and bean industries in Tasmania. It is from Tasmania that much of the opposition to the proposal has come, because it is Tasmania that is likely to be most affected. The processed pea industry is a most important part of Tasmania’s economy. The Agreement looms as a real threat to Tasmania’s welfare. I need point out only that in 1964-65 Tasmania’s production of peas for processing was about 60 per cent, of Australia’s total production. This meant a return to our growers of £1,250,000, which is a very substantial part of the returns to Tasmanian farmers of £5,250,000 from field cash crops.
I submit that the small farmers in Tasmania who grow this crop are just as entitled to protection as are other farmers in other parts of Australia. I do not know why we in Tasmania were singled out for this treatment by the Minister for Trade and Industry. He went to Tasmania during a State election some 12 months before this Agreement was entered into and attempted to form a branch of the Australian Country Party. But he did not succeed in getting his proposal off the ground. Without consulting the Tasmanian growers, and giving them only two days in which to prepare their case against the proposals in the Agreement, he singled out the Tasmanian growers for this treatment. Why did he do so? I wish he would come into the House, as I asked him to do once before when I spoke on this subject. Why does he not come into the House and tell me as a representative of these small farmers why they were singled out for this treatment when they produce 60 per cent, of Australia’s requirements of processed peas and 35 per cent, of Australia’s” requirements of beans? Has his action any political implications? Is there any truth in the rumour that was spread all over Tasmania, by people who should be adherents of his Party but who resigned overnight and put their money into other political parties, that he acted as he did simply from political malice because he could not get the Australian Country Party off the ground in Tasmania? I have asked him to come into the House and explain the position to me, but he has not done so. The members of the Australian Country Party who went to Tasmania at the time I refer to know perfectly well howmany people resigned from their movement, though they had hopes of forming a branch of the Party in Tasmania, and took back the money for which they had signed vouchers. This is a matter of vital importance to the people in Tasmania and they are entitled to an explanation.
The honorable member for Robertson said that the objections raised by the honorable member for Lalor dated back to September and October. I will shortly give him objections that are up to date and tell him of the fears and worries of the growers. The honorable member spoke about safeguards in the Agreement. 1 will tell him how the safeguards failed. However, before doing so, I want to say a little more about the value of the processed pea industry, because it is important to the people in my State. These are small farmers who may not be able’ to speak out for themselves. In 1964-65, 55 per cent, of the paddocks used for the production of the pea crop were between 6 and 10 acres in area. I emphasise that this is a small man’s industry. About 77 per cent, of the paddocks were less than 15 acres. The problem of the drift of population to the towns is sometimes mentioned here, but, if we allow industries such as the processed pea industry to go out of production, the drift of population will be accentuated. More than 50 per cent, of Tasmanian farms are smaller than the 150 acres that is considered to be the minimum economic size. That is to say, 50 per cent, of these people live on farms that are below the economic minimum acreage. The pea crop is very important to them because it enables them to have some sort of a living. The crop has a high return per acre and it is in the ground for the short growing period of only 15 weeks. The pea crop, therefore, is very important to the economy of these farmers.
The industry is expanding rapidly. In the last 10 years, the number of acres under production increased from 3,500 to 15,500. Surveys taken by the Department of Agriculture show that the area of land suitable for this crop is twice the area now in production. In other words, we are now growing peas on about 16,000 acres and the Department has established that wc have 32,000 acres of first class land suitable for the production of peas. However, although the land is available, farmers who want to grow peas cannot obtain contracts because the processors have not kept up with the expansion of the industry. I. am sure that it will not be long before the processors catch up with the expansion. Various canning factories are already expanding. If this expansion continues and if the industry continues to grow, many more farmers will produce peas.
One disadvantage that Tasmanian growers face when competing with New Zealand growers arises from the disparity of wages. In Tasmania, the average wage for people in this industry in the field is about £17 2s. 6d. a week. When the New Zealand wage is adjusted to the Australian currency, we find that the wage in New Zealand is £13 5s. a week. The Tasmanian growers are, therefore, placed at a distinct disadvantage without the Government allowing unlimited quantities of peas to be brought into Australia from New Zealand to compete with our own. Another factor is the processed pea known as Surprise “. This is a dehydrated pea of very good quality. The process is patented in New Zealand and we in Australia do not have the technical knowledge or the machinery to undertake it. It is a remarkable process in which every pea is pierced by a machine. It will take us a long time to get the process into this country, if we ever manage to do so. This poses a big threat to the Australian industry. The dehydrated peas are a quarter of the weight of the equivalent volume of quick frozen peas and, because they are dehydrated, they can be shipped to Australia at the lower general freight rate. This gives another big advantage to the New Zealand growers who, as I said, already have the advantage of lower wages. 1 do not know what this Government is doing about freight rates. We are at a distinct disadvantage in this regard. The freight rate from Devonport, from which port we send most of our peas, to Sydney - only a reasonably short distance - is 217s. a ton for refrigerated space. The New Zealand people, however, can send their frozen peas all the way from Auckland to Sydney for only 222s. 6d. a ton, just 5s. 6d. a ton more. In other words, our peas get to Sydney only 5s. 6d. a ton cheaper in freight than the New Zealand product.
– What about a Commonwealth shipping line?
– As the honorable member for Kingsford-Smith says, we could do with a Commonwealth shipping line, which we have advocated for some time. I think it will take a change of government to bring that about. We are being held to ransom by some of the shipping companies. Whereas we thought we might be able to get some advantage over New Zealand growers because of our nearness to Sydney we find that we do not. We are at a distinct disadvantage, not only because of the more favorable climatic conditions for growing peas in New Zealand but also because of the more favorable wage conditions in New Zealand and the freight rates that are involved.
I was surprised to learn of a product that is available in Canberra in very large quantities. It is a quick frozen pea which comes from Canada. 1 understand that in the packets there are small onions to help the flavour of the peas. Such products as these are flooding the market. I have probably more up to date protests from growers than those for which the honorable member for Lalor was criticised by the honorable member for Robertson. I desire to put in a plea for the small farmers. I always do. They are doing a terrific job and are entitled to as much protection as they can get. For the last five years, despite increased costs in this field, they have had no increase in the price for their product. They have done a magnificent job. They have absorbed increased charges in their ordinary production costs, which shows that they are a very efficient body of people, lt is no good anybody saying that these people should become more efficient. They cannot become more efficient. They have had no rise in price for five years. As I have said, they have done a magnificent job and are entitled to all the protection they can get.
We have too, associated with them, the processed bean growers, who produce 35 per cent, of the Australian crop. The story of both the pea and bean crops is a fascinating one. Bean growing started back in 1957 when International Canners Pty. Ltd., food processors, at Ulverstone grew 40 acres under contract in the area extending from Ulverstone to Smithtown. The cannery of Gordon Edgell Pty. Ltd. at Devonport commenced growing a few seasons later on its own farm at Merseylea but subsequently found its cost of production too high. It then commenced contract growing with farmers in the Devonport and Ulverstone areas. The cannery paid the farmer 7 id. a lb. of which the grower paid 3d. a lb. to the pickers. From a modest start back in 1957, which yielded 2,000 lb. per acre, giving a total of 80,000 lb., the industry has gone ahead by leaps and bounds and now the Devon cannery has a target of 4 million lb. of beans a year, and other canneries in Tasmania take up a million lb. From a modest beginning of 80,000 lb. back in 1957, when the industry started, we now have a target of 5 million lb. or 35 per cent, of Australia’s requirements. The yield has gone up considerably. The average yield is now 8,000 lb. per acre.
I again point to the need for protection for the growers. They have tied up an average of £5,000 each in irrigation plant and equipment so they are entitled to all the protection this Parliament can give them. I mentioned earlier the wages that are paid during the picking season. This is a very important aspect. One has only to visit the various towns during the picking season to know that the season has commenced. Money starts to flow into circulation. This is very important to the economy of the small towns along the north west coast of Tasmania. Wages paid to the pickers by the bean industry form a substantial part of the economy of this part of Australia. The wages average about £40,000 per annum and this money immediately goes into circulation to the good of the economy not only of Tasmania but of Australia generally.
The honorable member for Robertson said that the industry has adequate safeguards against any troubles. I wish somebody would do a bit of homework and have a look at the New Zealand-Australia Free Trade Agreement. We can only complain to New Zealand if we consider that there is a hurt to the industry. If we think that the industry is being hurt then Australia can discuss the injury with New Zealand with a view to obtaining some restraint on New Zealand trade. The people I represent fear that the Minister for Trade and Industry will treat us as he treated primary producers when the treaty was in the negotiation stage. He disregarded the interests of the primary producers by giving them only two days in which to prepare their case. The agreement provides that he “ may “ refer to New Zealand any fears that an industry may have, but it does not say that he has to refer those fears to New Zealand. It does not say that if he receives a complaint from processors in Tasmania, from the pea growers or bean growers associations, that irrespective of how valid a case they may put up he has to refer it. There is no provision, if a member of Parliament makes representations to him, that he has to refer the matter to New Zealand. The Agreement just says that he “ may “ refer it. As a result of the attitude he displayed when this Agreement was brought in we fear that he may not take up our case.
Another provision in the Agreement is that 60 days must elapse after a complaint before the Agreement is suspended. Following the suspension the Special Advisory Authority will hear the complaint and decide upon it within four weeks. I would point out to people who say that there are adequate safeguards that it is obvious that at least three months must elapse from the time Australia complains about any serious injury until something may be done. I point out again that the pea and bean season lasts for only three months and therefore as a result of unrestricted imports one whole season’s returns could be lost.
There is a worse part to the Agreement still. It is written into the Agreement that during this 60 days Australia cannot make any direct inquiries in New Zealand. In other words we cannot send people over to New Zealand. We cannot get anyone to go to New Zealand to look into the cost of production in that country, to see if there are any rings, any export marketing arrangements or anything going on that is detrimental to our industry. We are not allowed to make direct inquiries as to whether the industry at that particular time is being subsidised by the New Zealand Government. We cannot make any direct inquiries in New Zealand during this period of 60 days. Why not? If we are such great allies, if we are such great friends and such great colleagues of these people, why, if we have a complaint to make, cannot we tell our High Commissioner in New Zealand or our trade people in that country to have a look at the position and try to find some evidence either for or against our complaint so that we can have an unbiased look at the whole problem? It is written into this Agreement that we cannot make any inquiries during the 60 days. During that time the gates have to be left wide open and the industry could be seriously damaged. Is it any wonder that we have these fears?
The honorable member for Robertson says that some of the evidence is old, but T think it is good to refer to it. A newspaper article I have here, headed “ N.Z. Attitude on Trade Pact “, reads -
The Free Trade Agreement between N.Z. and Australia could provide a “ welcome fillip “ to N.Z.’s vegetable processing industry.
If honorable members will read the “ Hansard “ of the New Zealand Parliament in which the debate on the Free Trade Agreement is reported they will find reference after reference by members to New Zealand as the coming vegetable garden for Australia. We read in the Press -
New Zealand free trade plan is threat to pea industry.
This was only two days before the negotiations. Let the Minister for Trade and Industry deny this. The report stated -
The secretary of the Canning Pea Growers’ Association of Tasmania (Mr. B. R. Bonney) said at Devonport yesterday that . . . while all parties concerned appreciated the difficulties involved in overcoming the problem of the large imbalance of trade between New Zealand and Australia, the short notice of only two days given for the Canberra meeting and the inclusion of frozen peas in the schedule had surprised representatives of the pea processing industry and had created difficulties in the preparation of information to support action against the proposal.
That is a further statement which shows that only two days’ notice was given. Honorable members opposite cannot deny that, nor can they challenge the word of a reputable man like the secretary of the Canning Pea Growers’ Association. There was article after article along this line. One carried the heading “ Victimisation “ and it stated -
Negotiations for the projected limited free trade agreement between Australia and New Zealand have been under way for the past 18 months or so. . . the understanding all along has been that agricultural commodities would be excluded from this Agreement, a very obvious one in view of the pre-eminent contribution of the agricultural industries towards the economic stability of this country.
However, a bombshell was thrown into the discussions last week with the announcement that the New Zealand Government had proposed that certain agricultural commodities - frozen peas, beans and lamb-should be included in this Agreement.
The decision on this proposal is one for the Australian Government and of the Federal Parliament-
I think the writer is in error in making that statement - who will ultimately have to ratify the agreement.
What they should know is that to admit frozen vegetables into this Free Trade Agreement will victimise the economy of this one small State in a way that will do the maximum amount of damage and disruption and. if proceeded with, will take years to overcome and therefore must be opposed.
These may be hard words, but the fact of the matter is that in the few short years of its existence the processed vegetable industry has become a big factor in the Tasmanian rural economy. It affects the northern part of the State and particularly has enabled many of tha smaller farmers to remain economically afloat. lt is no wonder that my constituents are concerned about the effects of the Agreement, which we of the Labour Party will oppose. Another article carried the heading “ Guilty conscience “. I ask honorable members to listen to this, lt stated -
The fact that the Australia-New Zealand free trade pact was agreed with remarkable haste and without the Government informing or enabling any of the industries affected to put up any real argument against the introduction of such a far-reaching and dangerous proposal, is among the most noteworthy features of this development.
The speed and suddenness with which the negotiations were concluded inevitably leads to a suspicion - ‘that there is a great deal to hide in this whole sorry episode.
– That is not true.
– This is the leading article in a very reputable newspaper. lt continued -
The lack of any reliable information as to the scope and extent of the Agreement, a fact which has been severely and trenchantly criticised, merely lends force to this thought, while the rather naive admission by the New Zealand Minister that be and his Australian counterpart had agreed on a process of gradual disclosure in the hope of avoiding violent reaction from Australian and New Zealand producers who may be affected, will only be interpreted as signs of a very guilty conscience.
– What is the name of the newspaper?
– It is the Tasmanian “ Farmer “, which is published in Launceston and which is affiliated with the Australian Primary Producers Union. It is a very reliable newspaper. I have also a whole host of telegrams and newspaper cuttings going right through the months. A telegram from the secretary of the Canning Pea Growers Association of Tasmania stated -
Consider primary producers being sold down river.
Another telegram was from the secretary of the Tasmanian Farmers Federation who said -
Consider implementation agreement inevitably result in disruption important Tasmanian rural industries having regard to known economic and climatic advantages already possessed by New
Zealand. Impact will be felt mainly by small Tasmanian farmers who even now are in economic difficulties.
We know that they are in economic difficulties because the price of butter fat today is lower than it was 10 years ago. That is a fact which cannot be disputed.
– Who is disputing it?
– Government supporters are doing so. Government spokesmen merely say: “ Despite all the information available and the fact that we have been a’ble to absorb all the increase in charges “ and so on. This telegram, which condemns the Agreement, is from the A.P.P.U. The honorable member for Gippsland is a member of that organisation.
Sitting suspended from 6 to 8 p.m.
– Before the sitting was suspended, I had dealt with the history of the Labour Party’s opposition to the inclusion of green processed beans and peas in the New Zealand-Australia Free Trade Agreement. I had pointed out the valuable contribution which this industry makes to the economy of the State of Tasmania and, incidentally, to the economy of Australia. I had endeavoured to find out why it was that this industry was singled out, as it were, for this special treatment under the Agreement. I had asked that the Minister for Trade and Industry explain to us whether this is the case or not. I had also pointed out to the honorable member for Robertson, who stated that he was quite sure that the safeguards contained in the Agreement were adequate, that in fact they were totally inadequate and insufficient to enable the Australian industry to meet the threat of competition from New Zealand. I had refuted the statement of the Minister for Trade and Industry that ample opportunity had been given to the processors and producers to state their case before the Agreement was signed. I think I had proved to the satisfaction of the House that this was totally untrue. I showed that he had given these people, who supply over half the frozen pea requirements of Australia, only two days in which to prepare their case, come to Canberra and present it.
The honorable member for Robertson stated that my friend and colleague, the honorable member for Lalor (Mr. Pollard), was quoting opinions that were expressed back in last September and October. I promised to bring the matter up to date by referring to objections made in recent weeks. 1 now conclude by drawing the attention of the House to the further protests which we have received from the Canning Pea Growers Association in a communication dated 25th March 1966, only a month ago. The document states -
In July and August last year (with the support of all pea processors and other farmer organisations), this association made every effort to oppose the inclusion of processed green peas and beans in the commodity schedule of the New ZealandAustralia Free Trade Agreement. These efforts were only successful in gaining one year’s grace before import duties would begin to be reduced in 1967.
The Association goes on to point out -
This additional year may be of value to processors to adjust techniques, etc., but it gives no such advantage to growers. As pointed out in my letter of 6th August 1965 to the Minister for Trade … it is our opinion that processors could use the Agreement to the disadvantage of growers (e.g. by reducing prices paid or acreage grown, etc.) and this strong belief has in no way diminished over the last seven months.
This is the opinion of a qualified body of growers who have formed the Canning Pea Growers Association and who are responsible for the production of 60 per cent, of Australia’s requirements of this type of vegetable. This further statement is interesting -
During this period we have sought detailed information from the Minister for Trade (with little success), we have read statements by the Prime Minister and other Ministers, and have had lengthy discussions with New Zealand Trade Commissioners and Members of State and Federal Parliaments.
After careful study of all available information we are still of the opinion that the inclusion of green processed peas and beans in the Agreement is a serious risk to the stability and growth of the processing pea and bean industry in Tasmania.
I repeat for the information of the honorable member for Robertson, who took my friend the honorable member for Lalor to task, that this letter of protest is dated 25th March 1966. The Association goes on to urge all members of Parliament to oppose any reduction of import duties on all forms of this commodity in any way that is possible. It states that this request is made with the full support and knowledge of the Tasmanian Farmers Federation Bean Committee. I am very pleased indeed that the Australian Labour Party is opposing these reductions of duty, because they represent a threat to the farmers in my area.
– Order! The honorable member’s time has expired.
.- 1 rise at this point of time to answer some of the charges made by the honorable member for Braddon (Mr. Davies). Unfortunately, because of other commitments, I have not had the opportunity of hearing the whole of the debate, but when, on coming into this House, I heard the charges made by the honorable member for Braddon I felt that they must be answered. The first charge he made was that the Minister for Trade and Industry (Mr. McEwen) had given the frozen pea and bean industry no opportunity to discuss the position.
– Be truthful. 1 said he gave them two days.
– The honorable member said the Minister gave them no opportunity to discuss the matter. The truth is that they did have an opportunity. They spent some hours in conference with representatives of the Department of Trade and Industry.
– Try to be honest. They had two days to prepare a case.
– The honorable member says they had two days. As one who has grown peas and beans, I would know enough about my industry to be able to submit a case on a matter of this nature in two hours. Do not tell me that those engaged in the frozen pea and bean industry do not know enough about their industry to be able to compile a case in two days. Such a suggestion is nonsense.
– Tell the truth.
– I am telling the truth. The honorable member reminds me of the footballer whose mother said: “ You cannot play today, son; you might get hurt.” The fact is that no damage at all can be done to the industry at this stage. Indeed, there can be no damage at all until 1st January 1967, because no reduction in duty will be made until that date.
Let us examine ano:her point. Australia’s annual production of peas and beans for processing is 57 million lb. The honorable member for Braddon has put up a great argument about the New Zealand frozen peas that will be coming into Australia. I remind him that the total weight of peas imported from New Zealand in 1963-64 was 3 million lb. In 1964-65, the quantity dropped to 2 million lb. When we remember that Australia’s total production of these vegetables is 57 million lb., the honorable member’s argument seems hard to support.
I think the real basis for opposition might be freight considerations. A certain organisation in New Zealand has introduced the Surprise pea. If the honorable member based his case on an argument of that type, we could understand it better. We know that Unilever has introduced the Surprise peas into New Zealand. These are not frozen peas. The Surprise peas are peas which have been subjected to a process which removes the moisture, and they can be transported without refrigeration at very little cost. This process is being used in New Zealand. The Surprise pea is a much more palatable table pea than the frozen pea. Whether we like it or not, the fact is that the Surprise pea is taking over the market and damaging the frozen pea industry. If I were a frozen pea producer, I should certainly try to obtain from Unilever rights to produce the Surprise pea in Australia. The problem in relation to New Zealand is not one of competition between frozen peas; it is that the patent for this process is held in New Zealand. We should be trying to get the right to use the process in Australia.
The argument in relation to New Zealand in this matter is out of perspective because the truth is that more frozen peas are imported from America than from New Zealand. Last year, a total of 3 million lb. of frozen peas was imported from America. This was an increase of 2 million lb. over the amount imported in the previous year. Let us face the facts. The honorable member for Braddon has been abusing the Minister for Trade and Industry, to put it very politely. There is no basis for his abuse. Further, he has not put the facts clearly before the Parliament. I suggest that he have another look at the whole problem. I rose only to draw the attention of the House to the facts I have mentioned. I know that my name was invoked by the honorable member for Lalor (Mr. Pollard) earlier. I am sorry I have not had an opportunity to study his speech so that I could deal with him in the way I have dealt with the honorable member for Braddon.
– On the subject of peas I can vouch for the accuracy of what the honorable member for Braddon (Mr. Davies) said. He said in an earlier stage of this debate that primary producers were given two days in which to prepare a case. I commend the honorable member for putting up a case.
– The honorable member knows less about the position than does the honorable member for Braddon.
– It would surprise the honorable member to know that when I entered Parliament in 1950 I was enrolled as a farmer. I know what a Green Feast pea is, I know what a Gem pea is, and I know how many backaches there are in harvesting an acre of beans. Let that be the answer to the honorable member. I rose to deal with a matter that is of very great concern to me - the question of the future of the s’eel industry. Tariff protection has been an article of political faith in the Australian Labour Party. We have believed at all costs as an infant nation in nurturing and protecting fledgling industries and in establishing new industries. As a result of the fall of Singapore in 1942, and because in the last war for the first time we were placed entirely on our own resources in terms of industrialisation and defence production, we have since then perforce had to take an atitude in relation to protection much more severe than we did in a previous era. Today we are faced as a trading nation - and we are the 11th trading nation of the world - with many real difficulties. The first, of course, is the strong prospect of Britain, on suitable terms being arranged, entering the European Common Market. Britain is the largest food importing country in the world and it is still our major export market for food. That being so, the declared intention of the British Government - and it is entitled to decide a policy that is best for the interests of the people of its country - to approach the Common Market for entry is something that must give grave concern to us in Australia. It is true that Mr. Wilson would undoubtedly consult the various associated countries in the British Commonwealth of Nations and would do his best to ease the impact, but nevertheless an impact there will be, and a very serious one indeed.
This is only one of our problems, and it is a major one because it will drive us, as a primary producing nation, into the arms of another country from which we cannot expect the sympathetic treatment we have got from Great Britain: I refer to Japan. There are further problems, and I might classify them quickly. We will be faced with restrictive trading practices and restrictive franchises. Restrictive franchises are a matter of considerable concern. I have asked the Minister for Trade and Industry (Mr. McEwen) on many occasions to make some assessment of the impact on Australian industry and Australian exports of the severe restrictions that have been imposed - I think the number is in excess of 850 - on Australian exports, on the types of Australian exports, on the volume of them ‘ and even on the model of the particular export. This is a matter that has been well discussed, but it should be repeated on this occasion.
We go further than that. In our future trade relations - and in this instance we are an eastern trading country because we must look to the Pacific and Indian Oceans for our major markets - we are at a strong disadvantage in trade competition because we have two alternatives: One is to be integrated with the Japanese economy and the other is to pursue our own destiny as a competitive trading nation in the Pacific. It has been very well said that he who sups with the Devil needs a long handled spoon. Whilst Japan is certainly a major customer of ours at present, at the same time the Japanese are particularly astute traders. They are dominated essentially by self interest and they have literally lifted themselves up by their own economic boot straps. Japan is not a nation with great material resources. It lacks even an adequate reserve of foreign exchange. The latest figures that are available show that Japan’s reserves of foreign exchange - and we are dealing with the trading needs of a nation of 95 million - are about £900 million or $1,800 million, which is only 50 per cent, more than Australia’s exchange reserves. Taking it a stage further, many of the proposals that have been put forward for
Japanese trade - and quite a number of them were advanced last week at the trade conference in Canberra between representatives of Australian and Japanese industries - smack to me very strongly of not merely a revival but even an amplification of the Greater East Asian Co-Prosperity Sphere. What is to be our relationship with Japan? The apparent disparity in our trade with Japan is caused only by our sales of wool, and that wool would not be bought by Japan if she could buy elsewhere wool of such good quality or at as low a price. Our exports and imports in relation to AustralianJapanese trade are approximately equal, if wool is left out of consideration. However, that disparity will be used as a considerable lever on us and if we are not careful we will be placed in exactly the same position vis-a-vis Japan as we were with Britain - in other words we provided both the raw materials and the market for the finished product.
I have a quarterly journal published by the Australia-Japan Trade Council and known as the “ Economic Partner “. In it is reference to a very nice euphemism dealing with the possibilities of agreed specialisation between companies in the manufacture of certain products. Agreed specialisation, translated into ordinary trading terms, means that in the case of certain industries where Japan considers that it is more competent and efficient it proposes to dominate and to supply. If we go into an economic tussle with the Japanese and allow them to get too big a hold on us they will dictate our internal policy of development in relation to manufacture and in relation even to primary production. It is a dangerous situation. T want to see trade with Japan, but I want to see it on fair terms. The Japanese are astute, they are cunning, they are ruthless and they are domineering. They respect strength and they will have far greater respect for a Minister for Trade and Industry who lays it on the line, because they will know where they are going. The oriental respects power and strength and nothing else.
In the Australian economy there are only four major industries at present that are solely under Australian control. They are steel, cement, glass and sugar. I propose to deal with steel, which is the major secondary industry of Australia today. We are already reaching a dangerous situation in this industry. Tha latest production figures show that in 1965 Japan produced 44 million ingot tons of steel, a surplus over its consumption of 11.5 million tons. The Japanese economy has been working under forced draught for many years. The rate of increase in Japan’s gross national product has stepped up to the fantastic figure of 12 per cent, per annum. This has necessitated intervention by the Government in an endeavour to curb it. But such is their surplus capacity for steel production that the Japanese are looking to the world’s markets for somewhere to dump their steel - dump it in terms of our cost structure but sell it at a reasonable price in terms of theirs because of their currency manipulations. This matter should not be news to the Government because in 1963 the Broken Hill Pty. Co. Ltd. told the Tariff Board that by 1965 Japan’s programme of steel production would have created a considerable problem for the world’s steel industries. The warning was given then and the results are here today.
Only last December a request was made by John Lysaght (Aust) Ltd., one of the biggest manufacturers and processors of sheet steel in the southern hemisphere, for the application oi the dumping provisions of the appropriate legislation. The necessary proclamation was made by the Minister on 27th January. It related to all categories of sheet steel products of lesser thickness than 0.125 inches. Consequent upon that proclamation, any person buys Japanese sheet steel at his peril because of the possibilities of the retrospective application of a dumping duty. That is the theory, and the Minister has not been recreant to his obligations in acting in this matter. I have been informed by him that the necessary telegraphic communication was established with Japan and that his officers are endeavouring to ascertain derails of the Japanese cost structure.
That is where the rub is, because today, due to Japanese currency exchange manipulations, we are in a very nasty competitive position. When the Japanese were devastated by World War II and had their secondary industries largely destroyed they had an unexpected benefit conferred upon them because they were able to retool and reestablish secondary industries, using the latest inventions and processes of modern science and technology. To consolidate their advantage, in 1949 they turned to exchange manipulation. The yen was pegged at the very low exchange rate of 360 to the dollar or 108 to the pound sterling. According to Professor Shigetsu Tsuru, the Japanese economist, this has been one of the main factors in Japanese trade rehabilitation. The Japanese have not changed the exchange rate since April 1949. It is this undervaluation of the yen which is having far reaching disruptive consequences on the pattern of Australian internal and export trade.
The Japanese have three distinct advantages. The first is the tow real wages paid to Japanese workers. The second is the economies of scale due” to their production - a matter of 44 million tons a year compared with local production of 5 million tons. The third advantage is the undervaluation of the yen. One side effect of the undervaluation of the yen has been a spate of uninformed criticism of certain phases of Australian industry. Japanese industry has been in great heart ever since the exchange rate was changed. Dumping duties can seldom be applied to Japanese goods because of the advantage derived from the undervalued yen. Take the case of sheet steel. Black sheet steel, which is one of the staples of the motor body industry and the refrigerator and washing machine manufacturers, is sold in Australia at about £85 a ton. The Japanese are bringing black sheet steel into Australia and selling it at £80 a ton. That is a matter of only £5 a ton. But as the price of the Australian product is progressively reduced, so will the Japanese reduce the price of their product. I would be guessing but I would imagine that they could reduce the price of their product to perhaps £35 or £40 a ton before its production became uneconomic.
Further warnings of over production because of overseas competition were given by the Chairman of the Broken Hill Pty. Co. Ltd., Sir Colin Syme. Sir Colin warned shareholders of indications of an easing in demand for some types of steel. He referred in particular to substantial steel imports in the form of rolled products. He warned that these imports, coupled with the effects of the severe drought, had affected the demand for products of the B.H.P. company’s largest customer - John Lysaght (Aust.) Ltd. He said that the last time that the B.H.P. company’s capacity had substantially exceeded local demand was in 1962 and at that time export markets were readily available. The current position, Sir Colin said, was that in quite a number of countries there was surplus steel capacity and heavy selling pressure was being applied on world market.
Although I have stated a case on behalf of Australia’s steel producing interests, they deserve and have received considerable criticism. It is debatable whether the dumping provisions of the relevant legislation can be applied, because the trade cost of Japanese production cannot be ascertained, but a substantial, increased protective duty will undoubtedly have to be applied. In an editorial on 25th September 1965 dealing with the B.H.P. company the “ Sydney Morning Herald “ stated -
B.H.P. enjoys an absolute monopoly of steelmaking in a country with some of the most favorable natural advantages in the world. … Its costs advantages over all Western nations are at present unbeatable; quotations for steel imports from Britain or America are some 40 to SO per cent, higher than B.H.P.’s list prices, even though B.H.P. includes a very considerable margin per ton produced.
In its ability to supply or not to supply enough steel for our requirements, B.H.P. holds a key to the whole economy. It has more power than most Government departments and seems unable to realise that its very great privileges carry commensurate responsibilities.
B.H.P. seems to hanker for a capacity rate somewhat below the average market requirements when it should long ago have determined to provide a clear and continuous margin of excess capacity.
The company is at present lagging in the export race. Had it had faith in its ability to capture the export market because of the richness of Australian ore and Australian coking coal it might well now have been in the dominating position in which the Japanese are in relation to Pacific steel export trade.
Like other countries, we must export in order to live. Today, export trade means reciprocal trade. It means barter and the willingness to accept a quid pro quo. This applies particularly to the nations of the Indian Ocean and the Pacific Ocean because none of them has foreign exchange in terms of dollars or pounds sterling. It is a case of accepting the goods of these countries or not being able to trade with them. For the first time in 30 years, Lysaghts has had to apply for dumping duties. For the first time in 25 years the B.H.P. company has been undercut in steel in Australia. The situation is serious. In the first four months of the 1965-66 trading period, no less than £6.7 million worth of steel has been imported into Australia.
Let us examine further the trading strength of Japan and the techniques of the Japanese as they affect the steel industry. Japan does not dissipate its resources; it mobilises them - and it mobilises its bargaining power too. Japan in fact is dependent on imports for much more than half of its coking coal and for five-sixths of its iron ore. Under normal classical conditions of open competition the scramble for raw material resources would probably have added to the costs of the various Japanese steel producing companies. But the Japanese have been shrewd enough to forestall this. The Japanese Government has organised the foreign buying operations of the steel mills of that country into a tightly controlled buying cartel. Having eliminated internal competition in external buying, the Japanese have placed themselves in an effective monopoly position as buyers of iron ore in the Pacific area. To use the jargon of the economists, Japan is a monopsonist. The Japanese have further turned the seeming weakness of a raw materials shortage into an advantage by cultivating a large number of raw materials sources around the Pacific and Indian Oceans, ensuring that no supplier will acquire the power to exert direct influence on the regional price for iron ore. These are the people whom we have to contend with, who are in actual fact using their monopsonistic buying power and exploiting fragmentation of the suppliers. In this way the Japanese have been able to secure extra profit for themselves by driving down the f.o.b. prices paid to the nearer suppliers.
In relation to the economy of my constituency this is a most serious matter. John Lysaght (Aust.) Ltd. employs about 2,000 people in the Cunningham electorate. All overtime has been eliminated, and in a period when the 40 hour week is literally a joke and the average worker needs six or eight hours overtime each week the availability of overtime can mean the difference between balancing the family budget and going into debt. The impact is all the more serious because in my constituency there is the worst female unemployment problem in Australia. This is due. of course, to the mushroom growth of the area and the lack of balance between major heavy industry and light industry. At present no new employees are being taken on by John Lysaght Ltd. and the firm is combing its list of existing employees to make certain that any man due for retirement retires forthwith. The firm has been as fair as possible to its employees and I suppose it can only do its best, but the situation is one that cannot be allowed to persist. The Government will not be able to prove the cost structure of Japanese steel producing undertakings and it will not be able to apply the dumping duty provisions. Consequently there is an urgent need for a substantial increase in the present tariff on sheet steel imports into Australia.
.- I crave the attention of the House for 10 minutes or even less to associate myself with the fighting speech of my colleague from Tasmania, from which State most of the fight has come, on behalf of the Tasmanian pea industry. I wish to stress the effect that this legislation will have on the pea and bean industries in my State. Hundreds of acres of green peas are grown in my electorate and hundreds of acres more are grown in the Braddon electorate. Our island State produces 60 per cent, of all processing peas grown in Australia and 70 per cent, of all beans that are sold as frozen beans. This legislation provides for a reduction of the duty on imports of these commodities from New Zealand until after nine years they will attract no duty at all. Our farmers growing these very important foodstuffs are afraid - I think legitimately afraid - of the Agreement between New Zealand and Australia. We do not want to speak about this Agreement as if it was an evil thing because I believe Australia and New Zealand must draw closer to one another economically.
– Would you like two bob each way?
– I am not a betting man. I believe that a special trade agreement may eventually be negotiated between the two countries to cover commodities other than those involved in the agreement we are now discussing. Information about this legislation was passed to the farmers of Australia bit by bit from month to month, until we finally heart! the full story a long time after the Agreement was announced by the Minister for Trade and Industry (Mr. McEwen) in this Parliament. The farmers have come to the conclusion that there is great danger in it. The producers were successful in obtaining one year’s grace before the reductions of import duties would commence to apply in January 1967, but this year’s respite may be of value only to the processors, who will use it to adjust their techniques. The growers claim that they will obtain little or no advantage from it. As a matter of fact the processors could use this Agreement to the disadvantage of the growers, who are always at the mercy of processors, always at the mercy of the middleman, always at the mercy of the manipulators and speculators. There is no person done over so thoroughly by these groups as the Australian farmer, whatever commodity he is producing. The farmers believe that the processors could use this Agreement to their disadvantage by reducing the prices paid for their crops or by forcing a reduction of the acreage sown. As the House knows, all these processing peas are now grown under contract. The grower has to take whatever price the processor is prepared to give him, and anything that would fend to reduce that price is a serious matter for the industry, not only in Tasmania but in all other States where peas and beans are grown.
After a careful study of the situation the Canning Pea Growers Association of Tasmania came to the conclusion that the inclusion of green processed peas and beans in this Agreement constitutes a serious risk to the stability and growth of the processing pea and bean industries in the State. The Association believes that given encouragement and assistance by the Federal and State Governments and by the processors, the Tasmanian growers, together with those in Victoria and Queensland, could increase production of these commodities to meet the Australian demand. We are very pleased that there is a strong demand for these commodities in Australia. The consumers treat the green pea industry very liberally and graciously; they buy large quantities of green peas in all parts of Australia - understandably, because they are a darn good commodity. The growers believe they could meet our demands if they were given a chance to do so. But this lowering of the duty, followed later by a complete abolition of the duty, on New Zealand peas, will not leave the industry with any chance of expansion at all. Who would feel encouraged to expand knowing that in nine years time New Zealand peas would be brought here without being subject to any duty? There will be no encouragement to expand or to increase production.
We are going to oppose this part of the legislation. Our rural committee and our economic committee met together and agreed that we should oppose these provisions in the interests of the growers. The growers should be grateful to us for doing all that we can to voice our protest in this Parliament. If there were a Labour Government there is no doubt that this situation would not have arisen. An agreement in this form would not have been entered into at the present time.
– Any agreement entered into would have been worse.
– That is what honorable gentlemen opposite say. One of these days, we shall have a Labour government again and they will find that Labour can administer the affairs of this nation with just as much tact, knowledge and commonsense as the present government displays.
– In fact, with much more.
– I am just being generous for the moment.
– Was the honorable member’s remark a threat or a promise?
– It was a threat.
– Order! I ask honorable members to let the honorable member for Wilmot discuss the Bills before us, and I ask him to confine his remarks to the subject matter of the measures.
– Honorable members opposite sidetracked me, Mr. Speaker.
– The honorable member knows nothing about the measures.
– The honorable member himself knows nothing about green peas, anyway. The only subjects that I have heard him discuss in this Parliament in two years are Vietnam and defence. He appears to regard himself as the only expert on those subjects in the Parliament. He now claims that I know nothing about green peas, I have been member for Wilmot for nearly 20 years and throughout most of that time green peas have been an important crop in the electorate and 1 have studied the industry. I believe that we have a right to protest at the proposal to reduce the protective duty on which this industry relies and eventually to deny it protection completely after nine years. The Minister for Trade and Industry, who presented the New Zealand-Australia ‘Free Trade Agreement to the Parliament and who was in charge of the debate on it, issued a statement on 26th August 1965, trying to allay our fears about the reduction of tariff duties. In respect of frozen vegetables, his statement declared -
At present, protective duties are charged on a sliding scale basis when the f.o.b. value of imports is less than ls. 10½d. per lb. - that is, for every Id. be.low ls. 10id. two thirds of Id. duty is payable.
Under the Free Trade Agreement, it is proposed that protection against import competition from New Zealand frozen peas and beans will be maintained for nine years. The first reduction in the duty for frozen peas and beans would not take place for 12 months after the commencement of the Free Trade Agreement. For the following eight years, duty would still become payable below the same f.o.b. value of ls. 10id. per lb. as at present, but the incidence would be progressively reduced to a duty free basis at the end of nine years.
He went on to say that there is protection for all growers because there is provision for an annual review of the Agreement. That is very good, but the pea growers still do not pin much faith in it. The Minister also stated that if any serious damage is being caused to the Australian industry, the Government will be obliged under the terms of the Agreement to have a round table conference with representatives of the New Zealand Government. But what is the definition of “ serious “? How many growers will have to be put out of business before this Government will regard the situation as serious?
– Talk sense.
– I heard the honorable member earlier, and I heard no sense from him. The statement issued by the Minister for Trade and Industry went on -
Tn addition to the quantity limitations prescribed, there is in the Agreement a provision for the annual review of the operation of the quota arrangement and for the suspension of obligations if imports prove to be disruptive.
Finally, this observation appeared -
Moreover, there are a number of safeguard provisions in the Agreement designed to ensure that there will be fair and equitable trading conditions between Australia and New Zealand in the commodities covered by the Agreement and a clear understanding between the two Governments that speedy action will be taken in the event of unforeseen developments in the unlikely event that imports had an adverse effect on local industry.
Admittedly, safeguard provisions are written into the Agreement, Mr. Speaker. But after a close study of the matter we on this side of the House do not consider that those safeguards are sufficient, because, after nine years, whatever this Government may do, the duty on processed peas will disappear completely.
– But the industry will still be protected.
– It will be protected to a degree for nine years, and after that there will be no more protection. The industry will have to stand on its own feet. After nine years, there will be an uncontrolled flood of imports from New Zealand. We are concerned about the possibility of injury to the Australian industry in the long term, not in the short term, for our industry is still protected in the short term. After nine years, it will have no more protection, since the duty will be completely removed.
– The honorable member said that he would speak for only 10 minutes.
– The interjections of the honorable member’s colleagues have forced me to take longer. New Zealand produces wonderful processed peas - “ Surprise “ peas - which are sold throughout Australia. The patent rights to the process are held in New Zealand. If “ Surprise “ peas are marketed in Tasmania and the other States in considerable quantities the Australian peagrowers will be gravely affected. This New Zealand product is excellent in every way. We shall have to try to match it by undertaking research to develop a similar process. A significant factor that has a bearing on our opposition to the reduction of duty is revealed by the import statistics that are issued by the Commonwealth Bureau of Census and Statistics. These statistics reveal a large increase in imports of frozen peas, beans and other vegetables in 1964. Imports from New Zealand represented 52 per cent, of the total value of these imports from all sources. In the first year of operation of the Agreement, that country increased its exports of these commodities to Australia by an enormous percentage. We believe that there is great danger for the Australian industry in this trend. So I add my voice to the voices of other Opposition speakers who have opposed certain provisions of the Customs Tariff Bill (No. 2) 1966, Mr. Speaker. The Opposition will vote against the reduction of the duty.
Mr. WENTWORTH (Mackellar) [8.471.- Mr. Speaker. I believe that the honorable member for Wilmot (Mr. Duthie) has been working the parish pump perhaps a little too hard. I know that in his electorate what he has said will be good propaganda, but he should be ashamed for using local propaganda for his own electoral purposes in a way which he knows, I am sure, is to the disadvantage of Australia. We must look at this matter from a national standpoint. Nobody in this House is more protectionist than I am. I. believe in the theory of protection and I believe in the protection of Australian industries. But in this instance we are thinking of the possible better integration of the New Zealand economy with Australia’s economy for the benefit of both sides.
– For the benefit of both sides?
– Yes, for the benefit of both sides. The New Zealand Free Trade Agreement will require changes in some industries. They will have to become more efficient. This is true. Yet, from the national standpoint of either New Zealand or Australia, this Agreement is a good thing. We need closer ties with New Zealand, for national as well as economic reasons. I do not know whether honorable members generally agree with me, but I consider thai’ the honorable member for Wilmot should be ashamed of working the parish pump so hard and trying to pour cold water over the interests of the Australian people, lt is perhaps only incidental that the honorable member has not read the Agreement thoroughly. He does not realise that articles 8, 9 and 10 will have continuing effects, even after nine years. So the honorable member was wrong on this aspect of the Agreement. But this is only a small point.
The main point that I want to make is that both New Zealand and Australia have the highest possible reasons for getting together economically and otherwise in order to ensure their national survival. If it will be necessary to help in some way people who will be hurt by the measures adopted to put the Agreement into effect, I shall be all in favour of helping them. If this presses hard on the people in the electorate of the honorable member for Wilmot, then I am all for giving them substantial relief. I am all for helping them to become efficient producers. I am all for helping them in every way possible. But I am not in favour of cultivating their parochial interests in a way that will harm overall the people of Australia. Let us be fair and reasonable about this. If anybody is hurt’, let us give him special help. But this special help must not be prejudicial to our national interests.
That is all I want to say on this matter. I hope that when the honorable member thinks about this a little more, he will be ashamed of the thing he has been trying to do in this House for his own local political reasons. I hope that the electors in his electorate will be. sufficiently broadminded to be ashamed of him.
– Mr. Speaker, I rise to make a personal explanation because I have been grossly misrepresented. 1 would like to assure the honorable member for Mackellar that I am not one bit ashamed of what I have said tonight, lt is not parish pump politics.
– Order! I think the honorable member for Wilmot wants to begin a second effort. I call the Minister for Air, who will close the debate.
– in reply - Mr. Speaker, the second reading debate on this Bill has roamed over a wide number of subjects most of which will be dealt with in the Committee stage of this Bill.
– Yes, once again. Therefore I do not feel it would be useful if 1 were to comment at this stage on the matters dealing with the New ZealandAustralia Free Trade Agreement, man made fibres, or any of the other detailed matters which have been discussed during this debate. Some wider matters have been raised by various members, and also some matters of detail affecting the Department of Customs and Excise, which I think I should mention as these matters will not be dealt with in the Committee stage. 1 think of the important matters of principle raised by the honorable member for Wakefield (Mr. Kelly). These matters gave us all a great deal of food for thought. Let me say one thing in the absence of the Minister for Trade and Industry (Mr. McEwen). The honorable member for Wakefield raised two particular matters. First, he dealt with the objectives of government policy in tariff measures and its relevance to the Vernon Committee report. I should only like to repeat the Government’s policy on this - it is the same as it always has been - and it is that we aim to protect economic and efficient industries. I think the honorable member must know that phrase by now.
– I have a vague idea of it.
– The honorable member has? In addition, we have all had the opportunity of reading the report of the Vernon Committee. The honorable member referred particularly to two chapters that deal with tariff making and protection. A tremendous amount of food for thought is to be found in these two chapters which have been studied, and I expect that, in due course, further reference will be made to them. But even after reading the report, the honorable member will still agree that basically it agrees with the policy of the Government, which is that we should aim to protect efficient and economic industries. We differ with the Vernon Committee as to how we arrive at the detailed definition. We have examined tariff making machinery since the production of that report and we are still proceeding on the same lines. We are still getting a pretty effective answer. For the time being, that is where I will leave this subject.
The other matter to which the honorable member for Wakefield made reference and which I think is significant is the importance of the impartiality of the Tariff Board. I think it is only right that I should reiterate that the Government regards it as tremendously important that the Tariff Board and its machinery for tariff making should be considered as completely impartial and that everything that we aim to send to the Tariff Board will be dealt with on those lines. We realise - I think that this possibility should be re-emphasised - that the recommendations of the Tariff Board affect the whole course of commerce and industry in this country. It is inevitable that all interested parties do not agree always with all of the recommendations of the Tariff Board. It is understandable that there will be speculation concerning, and even criticism of, the Board’s activities. Also at this time when there is a close liaison between the Tariff Board and the various government departments, as there must be in certain instances, there will be criticism of this fact such as we have heard this afternoon from the honorable member for Wakefield. But, we regard the impartiality of the Tariff Board as vitally important to the pursuit of Government policy. We will aim to continue to treat the Tariff Board along those lines.
The honorable member for Wakefield referred particularly to the terms of reference relating to certain Tariff Board inquiries recently. I do not see why these references, in the way that they have been worded, should affect the independence of the Board, despite the remarks of the honorable member. The inquiries to which he has referred are what are known as industry inquiries. The terms of reference for these inquiries are drawn up to give the Tariff Board a mandate to hold a free ranging inquiry to decide which features of the industry should be looked at in detail. I do not consider that there is a conflict with the normal criteria of economic and efficient industries and these inquiries. Indeed, these words usually appear in the terms of reference that have been mentioned.
The honorable member for Wakefield also discussed the appointment of certain members to the Tariff Board. Again, I do not think it is easy for me, representing the Minister for Customs and Excise (Senator Anderson) here, to deal in detail with what the honorable member has said. But I repeat that as a member of the Government I have complete confidence in the impartiality and integrity of the members of the Tariff
Board. I should add also that 1 think that there are probably some advantages in members of the Department of Trade and Industry going to the Tariff Board if only for a period. There they have the opportunity of hearing directly from industry evidence of what goes on. The honorable member might think that the exchange broadens their viewpoint and might have some wider benefits instead of the disadvantages to which be has referred. I feel that the impartiality of the Tariff Board has been well demonstrated in the reports that we are considering tonight. I have complete faith in the work that the Board is doing.
Two or three other matters which have been raised are very important, I think. The honorable member for Bendigo (Mr. Beaton) suggested that Tariff Board reports and other machinery methods of this nature should be submitted to a committee of this House for consideration. That about sums up his suggestion. I raised this matter when 1 was in the same position that the honorable member for Wakefield holds as Deputy Whip. I still feel a tremendous amount of merit attaches to this suggestion. The matter would have to be examined by the Standing Orders Committee of the House because there are difficulties involved. 1 did try to examine this idea only two years ago. As it has been raised again. I think that we should take it up from here. As we now have a bi-partisan approach to this matter in the House, we might raise this matter with the Standing Orders Committee to see whether further action can be taken along these lines and also what the difficulties are. We might come to an agreement that would be worth while to us all. 1 wish to deal now with two matters of detail. The first was raised by the honorable member for Yarra (Dr. J. F. Cairns) and the other by the honorable member for Melbourne Ports (Mr. Crean). Dealing first with the question of dumping administration, I think the honorable member for Yarra already knows the principles on which these dumping arrangements are entered into. The way in which the machinery works is that the Minister for Customs and Excise notifies for general information bo.h by notice in the Commonwealth “ Gazette “ and by notice in the Press the goods which are under dumping investigation by officers of the Department of Customs and Excise.
He advises that the investigation is taking place. He aims to arrange for this information to be given at the earliest possible moment. The purpose generally is to warn importers as soon as possible that, if dumping is established, they may be called upon to pay dumping duties as from the date of notification. Cash securities arc required and taken as a holding action, if dumping is established by the Tariff Board, the cash securities are transferred to revenue. Conversely, if dumping is not established, the securities are returned.
The honorable member for Yarra raised the matter of shoes. I understand that initially the case to which he referred was a rather narrow reference of children’s shoes. As the matter was investigated, it evolved into a rather wider reference dealing with the whole subject of shoes, not only with children’s shoes. Finally, the case was of such a large nature that it could not be dealt with by the ordinary machinery and had to be dealt with by the Tariff Board as a whole. All this took much longer than might have been expected. However, the Minister has the option, if dumping has been discovered, after receiving a report from the Tariff Board, to date the new duties from the date of the Tariff Board’s report or, if necessary, to take a much earlier date. He still has an opportunity to look at this matter and, having heard the representations of the honorable member, I will ensure that he does have another look at it.
I am informed that the facts of the case mentioned by the honorable member for Melbourne Ports are not exactly as he gave them. 1 have asked the Minister for Customs and Excise personally to acquaint the honorable member with some rather special aspects that are raised in this question of duties on goods from Canada. I will see that the honorable member receives an answer fairly soon. The honorable member for Melbourne Ports also dealt with the question of the cancellation of by-laws and certain problems that arise in this area. A rather difficult matter of balance arises here. As the honorable member said, an Australian manufacturer may be ready to enter into production and, therefore, the time has arrived for the cancellation of the by-law. Sometimes an Australian manufacturer may be a little over optimistic about his ability to produce the goods and the by-law may be cancelled a little too early. But on the other hand we must look at the effect of leaving cancellation too late. A failure to impose duties early enough may result in an importer bringing in several years’ supply and thus shutting out the local supply for that period. This is a difficult matter of judgment, but I am sure the honorable member will realise the problems that are involved.
The honorable member for Bendigo raised the subject of dress shirt materials. I am informed that the question of by-law entry is once again before the Minister for Customs and Excise. It is being looked at and I hope the honorable member will be given an answer in the near future. I think that I have answered all the general matters that
will not be dealt with during the Committee stage, and we could now well deal with the question before the House and get down to the long matters of detail in Committee.
Question resolved in the affirmative.
Bill read a second time.
– Is it the wish of the Committee to consider the Schedule by proposed tariff amendments? There being no objection, that course will be followed.
Tariff Amendment 1.
.- This amendment, in sub-item 02.01.2, proposes to reduce the tariff on meat of swine when coming from New Zealand so that it has free access to Australia. The Opposition believes that this is undesirable because of the effect it will have on the production and selling of pig meat in Australia. The difficulties it will cause to growers have not been properly understood by the Government and no action has been taken to alleviate them. The Opposition does not believe that ii should allow the growers to face the difficulties that are certain to be caused by this amendment. Therefore, I move -
Omit sub-item 02.01.2.
– I oppose the amendment moved by the honorable member for Yarra (Dr. J. F. Cairns). We should look at the facts as they are, and the facts are that the present duty on pig meat from New Zealand is only 2c per lb.
I do not think anyone in his right senses would say that 2c per lb. will make any difference to the price of pig meat in Australia. Furthermore, no pig meats are coming from New Zealand now, anyway, because of the onset of trichinosis. During the campaign for the Dawson by-election, I ran across the problems of the New ZealandAustralia Free Trade Agreement. Opposition members of this Parliament had been making all sorts of damaging statements about the effects of the Agreement.
– We warned the pig growers.
– I heard the warnings that Opposition members gave when I was in the electorate and I would not like to repeat them in this Parliament. I oppose the amendment moved by the honorable member for Yarra purely and simply on the ground that, while a form of protection is stipulated in the Agreement, there is no likelihood o£ any pig meats coming into this country. The argument is completely academic.
.- The reasons for the opposition of the honorable member for Gippsland (Mr. Nixon) to our amendment are rather fragile. In effect, the honorable member says - 1. do not think he would deny it - “ What is 2c per lb. on a pig?” I ask the honorable member whether he would say that 150 lb. on the average would be a reasonable weight for some classifications of pigs.
– I would think that was too heavy.
– All right, make it 120 lb.
– That, is a good bacon pig. This is pork and pork is 60 to 80 lb.
– We will not quibble; we will say 120 lb. A lot of pigs weigh more than that.
– But this is pork.
THE CHAIRMAN.- Order! The honorable member for Gippsland has made his speech.
– I think we can compromise on 120 lb.
– Too heavy.
– Make it 100.
– Too heavy.
– lt is a very poor pig that will not weigh 100 lb.; that is all I can say. We will make it 100 lb. for porkers, back fatters and all types of pigs involved in this. I am being generous to the honorable member in making it 100. He can call it what he likes. I suppose 2c is the equivalent of approximately 2.8d. Let us round it off; make it 21d. on 100 lb. pigs. What do you get? It amounts to about £1 a pig on the average. You remove a protection of £1 a pig, and 1 think I am being generous in the calculation. The honorable member for Gippsland says that is nothing.
– It is $2.80 or 28s.
– Make it 28s., if you want to be accurate. The point 1 make is that in terms of a reduction in the price of pigs in a market it is the substantial sum of $2. I am being generous. Two dollars equals £], and £1 is a substantial fall at any time in a pig sale. It is all very well for the honorable member for Gippsland to pass that off, but if he had pigs on the market on a particular day and there happened to be New Zealand pig meat floating around and he suffered a reduction of £1 a head for his pigs he would not be so flippant as he is about the subject now.
The honorable member comes from Gippsland and should know something about pig raising. Pig raising is carried on in Australia in rather a different manner from what it was in my boyhood, when every farmer had a few pigs. He killed some and sent a few off to the market. Today pig raising is very highly specialised and you get farmers who produce nothing but pigs. On the other hand, in the very highly populated and rich dairying areas of Victoria - and this applies likewise in Queensland - pig production is a very special ancillary to the dairying industry. Everybody knows that the dairying industry is not in a very buoyant position today. Recent estimates by the Bureau of Agricultural Economics indicate that the cost of production of a pound of commercial butter today is about 66.46d’. per lb.; but that (he maximum guarantee which the Government gives to the dairy farmer is 40d. per lb. The farmer’s actual realisation per lb. of commercial butter was, I think, last year about 42d. per lb. So instead of profitably producing at the found cost of production and getting the found cost of production of 66.4d. per lb. he is getting 42d. per lb. Honorable members can imagine what a valuable ancillary the pig industry is to dairymen who are in that situation today.
In the circumstances the Labour Party says that it is outrageous for the Government to sell the dairy farmers and the pig meat producers down the drain in order to get a few more Holden motor cars or something else into the New Zealand market, or in order to gain some advantage for our secondary industries. It is blase or naive for the honorable member for Mackellar (Mr. Wentworth) to talk about the honorable member for Wilmot being narrow minded and parochial. The honorable member for Mackellar holds out hopes for the pea growers in the electorate of Wilmot who might get hurt. He suggests that no doubt the Government would do something for them. But at what point in the reduction of their income would the Government step in? If any primary producer in any section of production suffered a 1 0 per cent., or even a 5 per cent, reduction, in his net income as the result of the operation of this tariff, at that point would the Government step in and provide funds to make up that 10 per cent- or 5 per cent, loss? If a farmer suffered a 10 per cent, loss would the honorable member for Mackellar support a Government subsidy of 10 per cent.? Not on your life. The farmer would have to put up with his loss of 5 per cent, or 10 per cent, in his income with no recompense coming to him. lt is no good anybody trying to tell us that this does not mean a diminution of income for a substantial section of primary producers in Australia, particularly those who produce pig meats. 1 know that in the pig meat industry you cannot budget ahead and say that your income at the end of the year will be £3,000 gross, or £1,000 net. lt is a strange feature of the pig industry that it has ups and clowns very frequently, lt will have downs more frequently than it has ups when this tariff becomes operative. Another strange feature is that men buy into the industry, buy stores and make all sorts of plans, they estimate that they will get so much for their pigs after they fatten them, but when they send them to market they get half as much as they expect. There is none of the certainty in this industry that there is in secondary industry. In secondary industry a person has some hope of budgeting and some prospects of getting a return. In some cases he is in a monopoly and can meet with his fellow directors periodically and fix the price to ensure he will get a return for his investment in his enterprise. Under these circumstances I think it is a shameful thing for the pig producers to be sold down the drain by the Government. I support the amendment moved by the honorable member for Yarra.
Mr. NIXON (Gippsland) [9. 1 5 1. - I have now had an opportunity to judge the substance of the Opposition’s case. The honorable member for Yarra (Dr. J. F. Cairns) who moved the amendment had no substance in his argument at all and 1 had to wait until somebody who professes to know something about this subject in the Labour Party got to his feet. After hearing the honorable member for Lalor (Mr. Pollard) it is obvious that there is nobody in the Opposition who really knows anything about this subject. The honorable member for Lalor is the shadow Cabinet’s Minister for Primary Industry. The Opposition Whip, the honorable member for Wilmot (Mr. Duthie), said a while ago that the honorable member for Lalor was issuing a threat to the Government’s tenure of office. Pity help the primary producers of Australia if the honorable member for Lalor becomes the Minister for Primary Industry if the Opposition ever comes to power, judging by what he has just put to the House.
Let us consider some of the suggestions that he made. First he said he would settle on a porker pig being 120 lb. Anybody who knows anything about the industry at all knows that a 120 lb. pig is no porker; it is a baconer. That is all about that. The honorable member said that this tariff was going to make a difference of 28s. a pig to the farmer. Let us consider that. A porker is a 60 to 80 lb. pig, and the difference will bc 5s. to 7s. a pig. I just offer that as a comment. What does 2 cents per lb. mean when bacon is 8s. per lb. in the stores? I do not think it adds up to very much. Nor does it add up to very much per pig when a 60 to 80 lb. porker makes £10 to £12, or $20. We should look at this in its proper perspective.
The fact is that Australian pig meat production in 1964-65 was 120,000 tons. The fact also is that it is proposed that 3,000 tons should come in in the first year after the ban on pig meats from New Zealand is lifted. I do not think that anybody can rightly represent that 3,000 tons, as against 120,000 tons, will be as damaging to the industry as the honorable member for Lalor is suggesting. On top of that, the annual increase from New Zealand is to be 5 per cent, per annum on the first year’s intake. Having regard to the growth of the market I. do not think that 5 per cent, per annum on 3,000 tons is going to be terribly damaging when one considers that in 1963- 64 Australian pig meat production was 111,000 tons and in 1964-65 it was 120,000 tons. The whole argument of the Opposition is weak. We should add to what 1 have just said the fact that no pig meats are coming into Australia from New Zealand at this time. There has been no damage to the price by New Zealand pig meats, so the Opposition’s argument completely falls to the ground. It does not mean a thing at all.
.- I fail to understand how a representative of the Country Party, which purports to look after the interests of the primary producers, can say that it will not affect pig raisers in Australia if duty free pig meat and cured products are allowed to come into this country from New Zealand. The honorable member makes that claim and it is quite easy for him to do so. Dairy farmers in Gippsland are acknowledged as being some of the most prosperous in Australia and their production is the highest of any part of Australia. But in Queensland many dairy farmers are on such a low margin that they must depend on the production of pig meats. There has not been any importation of pig meats because of the ban which has been operated for 12 months, but in many years in the past pig raisers have looked askance at the importation of pig meats from New Zealand, the United States and other places. They have always been concerned about these products coming into Australia at a time when the market seemed to be rising because there was an immediate deflation of the market and the prices received by the pig raisers. Two cents per lb. may not seem much, but it means a great deal to those in the industry. I believe that they are just as much entitled to protection as people in any other industry.
I have attended quite a number of meetings in Queensland where dairymen have asked: “ Are we being sold down the drain so that Australia can sell more Holden cars to New Zealand? Because of heavy industry, are we going to be sacrificed? “ I do not want to be diverted and to talk of the problems of the dairy industry, but I believe that it is most important that protection for the industry be maintained. For that reason I propose to vote in favour of the amendment.
Mr. BRIDGES-MAXWELL (Robertson) [9.22J. - I can understand the concern of honorable members and of pig growers, but I do not think the facts have been put to them correctly. Although the honorable member for Wide Bay (Mr. Hansen) said a moment ago that pig growers have asked whether they are being sold down the drain for the sake of heavy industry, he did not tell us what the answer was. In a previous debate on these subjects and judging by some of the questions that have been asked by honorable members opposite who represent Queensland electorates, an answer was given at that time and stirred up the present trouble. The honorable member for Gippsland (Mr. Nixon) said that when he was in Queensland earlier this year during the Dawson by-election, people in t’.ie industry were against the New ZealandAustralia Free Trade Agreement and were stirred up about it. But the facts are these: In 1963-64, before the disease trichinosis was discovered in New Zealand, 2,600 tons of pig meats came into Australia from that country.
The present proposal is that if and when New Zealand gets rid of the disease pig meats can come back into Australia, but there is a quantitative restriction, and 3,000 tons may be admitted duty free in the first year. That compares with an estimated Australian production of 121,000 tons. Each year there will be an increase of 5 per cent, on the previous year’s quota, but there are still the protections that are given by Articles 8, 9 and 10 of the Agreement which will allow for immediate consultations with the Minister and between the two Governments.
I have said before that this Agreement is designed to assist the two countries to develop in harmony and for their mutual benefit. It is not designed to harm any one section of one industry within one of the countries. If there is to be continual disagreement between the two countries, the Agreement cannot work and it will fall down in its main purpose. There must be compromise and there must be understanding. I believe the primary industries of Australia have been given adequate protection. I can understand the fears in the industry, but I believe that those fears can be allayed by the Agreement itself, by the statements that have been made by the Minister and if trust is put in the statements made by responsible Ministers of this Government.
– I want to offer my voice in support of the amendment which deals with the meat of swine. I listened with great attention to the devastating speech of the honorable member for Gippsland (Mr. Nixon) who allowed temper to control his voice in his hostility to the stand being taken by members of the Australian Labour Party. The Labour Party is known as a protectionist party, lt has always fought in the interests of producers in Australia. We feel very concerned about the reduction of duty on the meat of the swine, as the schedule describes it, to enable it to be admitted into Australia free of duty, lt is true that the amount to be imported is 3,000 tons and that our production is 121,000 tons, according to the last statistics available, but a grave principle is involved. I represent a Queensland electorate and I have always displayed a great interest in the welfare of the primary producers of that State. 1 am very concerned with the principle involved in this matter. There is a fair amount of dairying in Queensland and, although it hurts me to say so, the authority set up by the Government to inquire into the dairying industry arrived at the conclusion that dairying is not as efficient as it is in o:her States.
In Queensland primary producers associate the production of swine wilh the dairy industry and it is a valuable adjunct to that industry. The two industries work in close association and between them they tend to keep a degree of financial stability in farming areas. I am very concerned about the proposals that have been submitted. I regard the speech of the honorable member for Gippsland as an apologia for the action of the Country Party. I feel that this action is a complete sell out by those who proclaim to the nation that they represent the farmers. They say loudly that their Party is the only one that represents the farming community.
– It is just as well we are here.
– Well, it is most unfortunate that the elected representatives of the farmers are wholly in accord with the proposal to reduce the duty to allow the New Zealand producers of swine to send their meat to Australia to compete with the Australian product. The farmers are certainly concerned about this proposal and the voice of the people as expressed in the recent byelection in the Division of Dawson does suggest that the farming community is very concerned about the matter. I feel that this concern will be expressed throughout tha farming areas in the eastern States of the Commonwealth and will be a major factor in Queensland in the defeat of the Nicklin Government in country areas.
Although we in this place express our opposition to the Minister’s proposal, which has been blessed most enthusiastically by the Country Party, we have not the strength of numbers to carry our amendment on party lines. Consequently we are appealing to reason, hoping that members of the Liberal Party and particularly members of the Country Party will support us in our fight on behalf of pig producers throughout the Commonwealth. I feel that the producers will express themselves in a very firm manner when the general election takes place. I warn the members of the Country Party to beware of the irate pig producers of the Commonwealth, who see their representatives in this place standing up and associating themselves with something which can be aimed only at the destruction of their livelihood.
– I do not want to stifle debate on this extremely important subject, but I remind the Committee that we have 571 amendments to deal with and that we are now only dealing with the first. I only want to say that the Government cannot accept the proposed amendment. I think the reasons for that have already been put forward adequately by the honorable member for Gippsland (Mr. Nixon) and the honorable member for Robertson (Mr. Bridges-Maxwell). I am sure the honorable member for Mallee (Mr. Turnbull) will also be making a very valuable contribution shortly.
I point out to the Committee that Australia’s total production of pig meat this year was 121,000 tons. This Agreement will permit the importation of only 3,000 tons in the first year of its operation. At the moment, not even that amount is coming in because of the incidence of trichinosis in New Zealand. The Committee should also know that before any free trade agreement was entered into our imports amounted to only 2,600 tons annually. A further 400 tons is a comparatively small amount. 1 should like to add that the duty free quota for processors operates only for those who give an assurance that they will maintain the level and pattern of local purchases and that they will arrange imports in an orderly manner. Adequate arrangements have already been made for the effective policing of this. Some concern has been expressed at the possible effect the Agreement will have on prices. I remind the Committee that prices on the local market have increased since the signing of the Agreement. All of this would seem to indicate that the pig producers of Australia are fully taken care of in this Agreement. For those reasons, the Government does not propose to accept the amendment moved by the Opposition.
.- I think the honorable member for Gippsland (Mr. Nixon) unwittingly misrepresented me when 1 estimated that the average weight of pigs was 120 lb. That estimate included back falters, which weigh substantially more than that.
– The honorable member is getting worse.
– Nobody will convince me that the average weight of pigs in this country is not more than from 60 lb. to 80 lb.
– I am talking about what the market demands.
– I am talking about the average weight of the pigs sold on the Australian market. The honorable member should come back to earth. The average weight of all grades of pigs would be substantially over 100 lb.
The honorable member for Robertson (Mr. Bridges-Maxwell) said that prior to the ban imposed because of disease, Australia imported from New Zealand only 2,600 tons of pig meats a year. The Minister also mentioned that figure. If we take the average weight of all pigs as one cwt. this means that we are going to have an army of 52,000 pigs marching on us.
Reference has been made to the processors. They are the people who will import the pigs from New Zealand. The processors are strongest in New Zealand, where the local pig industry is very large. One can imagine the Vesteys, the Swifts and the other large international meat companies in Queensland buying 5,000 New Zealand pigs at one time, putting them into storage and then using the pigs for the purpose of forcing down the prices paid to Queensland producers. If the combines operating at Townsville, Gladstone and other places in Queensland had their stores filled with pigs from New Zealand, they would be in a position in which they would not need to be very active on the local market when the Queensland producers were trying to sell their pigs. If any of the honorable members who are sitting in the Country Party corner can convince the Queensland producers that the importation of 2,600 tons of pig meat, which represents 52,000 pigs, will not affect their market very substantially, I will go “ he “. What is more, if they found it expedient to do so the processors in north Queensland as well as those in south Queensland could send pig meats in refrigerated trucks to the Melbourne market and so force down the prices paid to the men who produce pigs in the electorate of the honorable member for Gippsland. It is no good trying to put up a bluff. The question is not what this means to Australia as a whole. The important question is what effect the Agreement will have in any particular place on any particular number of people. I think what I have said is beyond contradiction.
.- One mystery has been cleared up for me by this debate tonight. If the Opposition conducted its campaign in Dawson on the basis of the same kind of misleading information as it has offered, during this debate, it is no wonder that the people of Queensland took the view that they did. There are many experts on pigs here tonight. I do not pretend to be an expert on pigs. If we were dealing with sheep and cattle, it would be a different matter. I do not think we should take notice of politicians who know very little about the game; we should take notice of the experts.
I very seldom quote from newspapers. Earlier today many extracts were quoted by honorable members opposite from newspapers up to 12 months old. I want to quote from one newspaper tonight, and this is unusual for me. I wish to refer to an article published in “ Land “, which is printed in New South Wales and is the official organ of the United Farmers’ Organisation. The issue to which 1 refer is dated Thursday, 21st April. It is not yet one week old. I refer honorable members to the headline over the article about which I speak. It is: “ New Zealand may Buy our Pig Meat”. The article reads -
New Zealand may have to buy pig meat from Australia in the near future, according to the President of the New Zealand Pig Producers Council, Mr. R. Davis. He said that at present New Zealand had no exportable surplus of pig meat and was not likely to have a surplus in the foreseeable future.
The president of the New .South Wales Branch of the Australian Pig Society, Mr. D. Campbell, told “ The Land “ that he had received this information from Mr. Davis.
These are real experts talking: not people who just think they know. The article continued.
New Zealand had not exported any pig meat in the past 12 months because nf disease problems.
The New Zealand public had gained a false image of the disease (as we had in Australia of swine fever) believing it could affect them.
Pig meat consumption dropped and a surplus had built up.
Last year it was feared that New Zealand would take advantage of an easing of trade restrictions and dump huge quantities of this surplus in New South Wales over a short period.
This would have reduced local pig prices.
Let me analyse the position. Last year it was feared that New Zealand would take advantage of a situation. It is not feared now. I have quoted the opinions of the President of the New Zealand Pig Producers Council, Mr. R. Davis. Let me repeat what he said - . . at present New Zealand had no exportable surplus of pig meats and was not likely to have a surplus in the foreseeable future.
By interjection I. asked the honorable member for Lalor where he would get all the pigs that he said would come from New Zealand and that he said were being sent to Melbourne, to Queensland and to New South Wales. New Zealand has not the pigs to send here. As the article I have quoted states. New Zealand in the near future will probably be forced to buy pig meats from Australia. The very basis of the argument of the Opposition is completely false. One cannot possibly argue against the expert opinion of these New Zealanders. T do not support the amendment. What T have read leads me to believe that the new trade pro posal put forward by the Minister for Trade and Industry is very favorable to Australia.
.- 1 rise briefly to point out to the honorable member for Mallee (Mr. Turnbull) and to the Committee that the argument he put forward is fallacious. The Opposition is aware of the circumstances of the disease that has created the present situation, but this does not alter the fact that it is a short term occurrence only, lt will not have any long term effect on this particular reduction in tariffs and consequently there is no real basis behind the argument used by the honorable member for Mallee. The plain fact is that producers of pig meats in certain areas of Australia - particularly in Queensland - could be adversely affected by this measure. Consequently the Opposition raises its voice in order to attempt to protect those people, and we offer no apology for our action.
– I rise only to reply to some of the comments made about Queensland. M!ost of the Queensland members of the Opposition have mentioned Queensland, as have the honorable member for Lalor (Mr. Pollard) and the honorable member for Bendigo (Mr. Beaton). The facts of the situation have never been put properly in Queensland. Honorable members opposite either do not understand the facts or do not want to understand them. They would lead us to believe that there is a serious threat to our producers, but many producers in Queensland, in the electorate of the honorable member for Oxley (Mr. Hayden), have increased the breeding capacity of their pig flocks. In my electorate two companies have been established, each at a cost of about $10,000 and each to run about 600 sows. These are genuine bacon and pork producers who will make a success of the proposition. Our pork factories are not complaining about the situation and they are owned by pig producers.
There are safeguards in this trade agreement to the effect that if any industry can prove that it is being adversely affected by the Agreement or by the importation of products from New Zealand it has the right of immediate appeal to the Tariff Board. Up to the present no-one has suggested that they will be adversely affected by the importation of pork or bacon from New Zealand. No complaint has come from the dairy industry. Honorable members opposite have indulged in electioneering talk when they claim that our producers have been sold down the drain. They have not attempted to prove their statements. They have been unfair. Honorable members opposite who should know more about the true position have misled the people in the industry. I repeat what I said earlier - the Agreement offers protection to the producers. If a man can show that he is adversely affected, immediate action can be taken. Producers in my electorate, and in the electorate of Oxley, are not concerned about the situation because they are increasing their pig flocks every day and are spending thousands of pounds in doing so. New Zealand has no surplus of pigs. Some weeks ago I saw the statement that the honorable member for Mallee (Mr. Turnbull) quoted.
– It was published only last Thursday.
– I have seen it previously. The fact is that many people are giving up pig producing in New Zealand because it has not proved as profitable as they were led to believe. These are the facts and I think they damn the argument put up by the Opposition. They prove that the Opposition is not prepared to go out and tell the pig producers the facts of the case.
.- The honorable member for Mallee (Mr. Turnbull) produced a newspaper article. It is remarkable that he has done so. Apparently he reads only one type of newspaper. While he was quoting from it I turned over a few of the newspapers in my possession and I found another newspaper article that presented a remarkably different story from that recounted by the honorable member for Mallee. The article appeared in the “ Australian “ of Thursday, 9th December 1965.
– Come up to date.
Dr. J. F. CAIRNS__ I am afraid that the honorable member will have to come up to date or he will lose a lot of votes in Gippsland. The “ Australian “ article is headed “ McEwen Told Imports Disastrous To Dairymen. N.Z. Trade Pact Rebuff. Farmers Defy CP. Leader “ and states-
Queensland dairy farmers yesterday made a bitter face-to-face attack on the deputy Prime Minister and Country Party leader, Mr. McEwen, over the Australia-New Zealand Trade Treaty.
Do honorable members opposite know him?
– Where did this happen?
-I am sure that the honorable member will be glad to learn where it happened. The article continued -
The executive of the Queensland Dairymen’s Organisation, meeting in Brisbane, refused to rescind a motion condemning the treaty, which comes into force on January 1.
Mr. McEwen addressed the 25 members of the executive for two hours on the advantages of the lower tariffs provided for in the treaty,–
I interpose here because members of the Country Party told us that they did not have a chance to put their case and that it was the wicked Labour Party that had gone to the Dawson electorate and gained such a great advantage; but according to this article the Minister for Trade and Industry, who is well known to honorable members opposite, had two hours in which to speak to 25 members of the Queensland Dairymen’s Organisation. The article continues - but failed to convince them that it would not smash the industry and put many of them out of business.
In Melbourne, the secretary of the Victorian Dairy Farmers’ Association, Mr. K. Thorne, said the treaty was the thin end of the wedge to allow more New Zealand dairy products into Australia.
At the Brisbane meeting the State President of the Q.D.O., Mr. C. S. J. Conroy, told Mr. McEwen the treaty’s implication was that the dairy industry was being sacrificed in the interest of manufacturers.
The treaty provided for the free import of 400 tons of cheese from New Zealand in the first vear, rising to 1,000 tons in 1971.
This would force Australia, which was increasing cheese production, to sell its surplus on poor overseas markets at a loss. “ Your trade agreement “, Mr. Conroy told Mr. McEwen, “ in allowing 3,000 tons of pigmeat cuts, plus unrestricted bacon and ham imports, rising by a compounded figure of 5 per cent, annually, will also create hardship to dairy farmers”.
The threat of large-scale imports of pigmeats from New Zealand had already caused a sharp fall in the prices curers were willing to pay, and many dairy farmers could not survive.
Mr. McEwen’s remarks were frequently interrupted by interjections from the executive members.
These were not supporters of the Labour Party in the normal sense; they were members of the Queensland Dairymen’s Organisation. The report continued -
He did not improve his popularity by pointing out that the industry received a direct subsidy of just under £14 million from the Commonwealth each year.
He argued that the treaty, far from harming the dairying industry, improved the outlook for the cheese sector by placing a limit on the amount of cheese that could be imported.
If Britain joins the Common Market, then New Zealand will be looking for an alternative market and the treaty will provide protection,” he said.
Mr. A. P. Beatty, of South Burnett, said the Government was at fault for not even discussing the implications of the treaty with the industry before signing it.
That was the point that we have made several times in the debate. There it was made by a senior member of the Queensland Dairymen’s Organisation. So, if the Queensland Dairymen’s Organisation wants its case stated in this Parliament it has it stated from this side of the chamber. Apparently the honorable member for Mallee and the honorable member for Gippsland are not aware of these happenings in Queensland. The report continued - “ Already our pig prices have fallen sharply as a result of your agreement,” he said. “ Curers are being offered unlimited supplies of pig meats at ls. 7d. to ls. lOd. a lb. which is 6(1. to 9d. a lb. lower than our present depressed price.
And it does not matter whether the animal weighs 60 lb., 80 lb. or 100 lb.; the price is still ls. 7d. to ls. lOd. per lb. which is from 6d. to 9d. per lb. lower than our present depressed prices. The report continued - “ The curers are clapping their hands for joy, but for dairy farmers this is disaster.”
Mr. McEwen rose to his feet and said, “ This is utter nonsense. I will not allow New Zealand to undercut the local market, and this is provided for in the treaty.”
Another executive member interjected, “ You, Mr. McEwen, have given away our home market and that is our only profitable market. You are taking our objections far too lightly. The average dairy farmer is already getting less than the average wage -earner.”
Is it any wonder when he is represented by such men as members of the Country Party, who have no knowledge of his needs and who have no counter to the arguments contained in the report which I have just read?
So I am pleased that the honorable member for Mallee referred to a newspaper article. He showed that his reading is limited; that he reads only a certain kind of newspaper or produces only newspapers that suit his purposes in this chamber. Where is this famous newspaper to which he referred with such pride a few moments ago? It seems that the “ Australian “ has effectively drummed the “ Land “.
.- Any honorable member who suggests that the Acting Prime Minister (Mr. McEwen) does not have the interests of Australia’s primary industries at heart is refusing to face the facts of life. When he was Minister for Primary Industry, he invited the pig industry to come into the 15 year meat agreement, but it refused. The beef industry and the lamb industry came in. At that time the problems confronting the pig industry were possibly greater than they are today or ever will be. As for the report read from the “ Australian “ by the honorable member for Yarra (Dr. J. F. Cairns), we can reject it as not being a true indication of what took place at the meeting.
The only way to overcome the problems confronting the pig industry is to budd strong Australian industries. We must increase the purchasing power of the Australian people. So much of the trouble in which the pig industry now finds itself has been caused by our purchasing power not keeping pace with production of pig meat. The only way to increase our purchasing power is to step up our migration programme and the production -of our secondary industries. One way to achieve these ends is by entering into trade agreements with other countries. It has been amply demonstrated tonight that the pig industry will benefit greatly from the New Zealand-Australia Free Trade Agreement because of the situation that has arisen in New Zealand and which is known to everybody in the pig industry. The pig industry will, as a result of this Agreement, be strengthened by the increased purchasing power of Australians and also because of what has happened in New Zealand. These things cannot be denied. Increasing the purchasing power within Australia is the only way by which the pig industry can be enabled to stand on its feel. By entering into more agreements such as the one with New Zealand and by making Australia industrially strong we will strengthen the industry under discussion.
– The honorable member for Lalor (Mr. Pollard) should not deprive us of the opportunity to see him go “ he “, as he offered to do, because as has been explained, the Australian pig industry has survived and thrived notwithstanding the importation of 2,600 tons of pig meat. The honorable member said that when the import figure reached 3,000 tons he would go “ he “. I say to the honorable member: Let us see it. The protections which the honorable member rejects are real. The processors have given an undertaking that they will not allow the Australian market to be disrupted or affected. This is a matter that can be policed. It has been done in the other meat industries. The examples which the honorable member gave are out of his imagination and are not real. The protections in the New Zealand-Australia Free Trade Agreement are real.
As for the report which the honorable member for Yarra (Dr. J. F. Cairns) read, insofar as it gave one side of the picture it was relatively accurate. But the report did not give full details of statements made on that occasion by the Minister for Trade and Industry (Mr. McEwen). All of the vital matters were covered fully by the Minister. As is reported, Mr. Conroy thanked the Minister for coming and said that people at the meeting were more enlightened than they had been, although he may still have some reservations on the matter. However, the Queensland Dairymen’s Organisation had not finally made up its mind on the matter. The Minister gave to the Queensland Dairymen’s Organisation undertakings that should allay the fears of its members.
Question put -
Thatthe sub-item proposed to be omitted (Dr. Cairns’s amendment) stand part of the Tariff Amendment.
The Committee divided. (The Chairman - Mr. P. E. Lucock.)
Majority . . 15
Tariff Amendment agreed to.
Tariff Amendment 2.
.- by leave - I move -
I do not wish to repeat what has already been said on this subject. These amendments deal with the same matter as the amendment that has been debated at length by the Parliament. I think the case put on behalf of the Opposition in respect of its first amendment is the same as the case we would put in support of these two amendments. There is obviously a considerable amount of concern amongst pig producers in various parts of Australia about the possible and probable impact of this agreement - and also the actual impact as shown by the statement I read earlier this evening from the “Australian” newspaper. The Committee is well aware of what was said about the previous amendment and I do not wish to say anything further.
Tariff Amendment 5.
– The Government does not accept these amendments for the same reason as it did not accept the amendment dealing with pork. These two amendments deal with imports of ham and bacon from New Zealand, which are very small in comparison with total consumption. In 1964-65 imports from New Zealand amounted to 43 tons while total consumption in Australia was 43,000 tons. As to canned ham, there have been no imports since 1963-64. Imports in that year amounted to only half a ton, and production of ham in New Zealand is declining. We believe that Australian pig producers are being adequately provided for in this Agreement. Therefore the amendments should be rejected.
Tariff Amendment agreed to.
Tariff Amendments 3 and 4 - by leave - taken together, and agreed to.
.- Mr. Chairman, I move -
In column 4, omit “ NZ (A): $0.04 per lb.” thrice occurring.
This tariff amendment applies to Cheddar cheese and proposes to reduce the duty on imports of this commodity from New Zealand. We are aware, of course, that quantitative limits are imposed each year. We know that this proposal, like the amendments previously discussed, has caused a great deal of concern. Dairy farmers in various parts of Australia are concerned about the likely effects of imports from New Zealand. We have already quoted the evidence of this. There can be no question about the existence of this concern. The odd situation is that the Government chooses to reply to representations by saying that the volume of imports coming in from New Zealand is so small as to make impossible any harm to Australian producers. lt tells us that in some instances production in New Zealand is declining, that in others the rate of duty is small and that in others again the quantity coming in from New Zealand is so small compared to the total Australian production that it cannot possibly have any adverse effect on the Australian industry.
If the submissions made by the Minister for Air (Mr. Howson) and other Government speakers all evening are correct, what is the good of the New Zealand-Australia Free Trade Agreement to New Zealand? If that is the position, it is not worth the paper it is written on. If that is the position, why did the Government go to the trouble of including these items in the Agreement? If so little Cheddar cheese comes in from New Zealand that the situation will not be affected by imports from that country, what is the good of the Free Trade Agreement? Is it not another of these trumped up trade agreements with which the Minister for Trade and Industry (Mr. McEwen) attempts to make his name famous for political reasons? In the light of what we have heard from the Government side of the chamber, what is the use of the Agreement to New Zealand? What is its value as a trade agreement between two countries? Is it not just another chapter in the dramatic story that the Minister for Trade and Industry has become so fond of telling about himself and this Government? If the Agreement will not increase imports from New Zealand, what is the good of it to that country?
I believe, Mr. Temporary Chairman, that the Government has been caught on the horns of a dilemma in this matter. Recently, it has certainly appeared to be caught on the horns of something. I believe that this is what has happened here. I am glad to see that the honorable member for Chisholm (Sir Wilfrid Kent Hughes), who has just interjected, is awake. If the Opposition is wrong in saying that the reduction of duty will harm Australian producers, the Government is wrong in saying that the Free Trade Agreement is worth the paper it is printed on. The Government has to explain away this paradox.
.- Mr. Temporary Chairman, I cannot allow to pass the opportunity to give the Committee a few words of wisdom on cheese. For a long time, I have been one who has severely criticised the practices of the trading community in Australia in importing large quantities of cheese from overseas. On previous occasions, 1 have voiced my horror at the magnificent displays of overseas cheeses to be found in the principal stores in the capital cities. Those displays would gladden the heart of a gourmet, but they sadden the heart of an Australian patriot.
– The honorable member Joes not eat imported cheese.
– 1 absolutely refuse to eat imported cheese. I have stated before in this chamber that I developed a taste for an excellent cheese that was served in the Parliamentary Refreshment Room. On learning that it was imported, I imposed a complete ban on it and I no longer eat it. I shall continue to refuse to eat it. I am perfectly satisfied with cheese produced in Australia. The tariff amendment before us is designed to accord preference to imports from New Zealand of cheese and curd, including cheese having the eye formation characteristic of the Swiss or Emmenthaler type and cheese of the Gruyere or Emmenthaler processed type in packs not exceeding 10 oz. in weight, and Cheddar cheese. A considerable concession will be allowed on imports from New Zealand of cheese of these types. This will cause New Zealand cheese to compete with Australian cheese and will force Australian producers to seek new markets in other countries or else reduce their production.
This tariff proposal represents a serious attack on the primary producers with the full blessing of members of the Australian Country Party. I am not a nasty minded person by any means and I do not like to accuse anybody of deceit. But in my most charitable mood, I fail to reconcile the line of reasoning that members of the Country Party adopt in this chamber with that which they adopt on the hustings. The two vary greatly, Mr. Temporary Chairman. When an election is pending, members of the Country Party attempt to paint every other political party as an enemy of the man on the land. No member of the Country Party has attempted in this debate, in respect of cheese, to justify the unjustifiable. That has been left to the honorable member for Yarra (Dr. J. F. Cairns) and me.
– The honorable member is a funny fellow.
– M ay I say on behalf of the cheese producers that I am glad to hear that the honorable member is amused. No doubt, he will use that amusement as balm for his conscience, if he has any. How can any member of the Country Party do as he does? He goes out into the rural areas and talks about how he fights in this place for the primary producers. Yet the division list that will be prepared in a few minutes time will show that he and other members of the Country Party are prepared to stab the primary producers in the back over the New Zealand-Australia Free Trade Agreement. I may seem a little extreme in my outlook towards Australian cheese, Mr. Temporary Chairman. I believe that Australian cheeses are excellent. They are quite good enough for those who have cultivated a taste for good cheese. Indeed, I believe that Australian cheese is as good as the best in the world. Therefore, I enthusiastically support the amendment proposed by the honorable member for Yarra and I hope that it will be agreed to, for it is proposed in the interests of the Australian producers of cheese. I wish there were on the other side of the chamber more members who would be prepared to fight for those whom they claim to represent in this place. At any rate, the position of the Australian Labour Party is clear and my conscience is clear in rela tion to this matter. I support the amendment because it is aimed at helping the primary producers of this country.
– Mr. Temporary Chairman, the Government rejects this amendment, which is designed to do away with the arrangements made under the terms of the New Zealand-Australia Free Trade Agreement with respect to imports of Cheddar cheese from New Zealand. I believe that the facts should be put to the Committee, though they are probably well known, as they have been debated here on previous occasions. The arrangement is that in the first and second years of the Agreement 400 tons of New Zealand Cheddar cheese can be imported into Australia, rising thereafter year by year to a maximum of 1,000 tons in the fifth and subsequent years. This rate of import must be compared with the import in the base year of 260 tons and with an Australian production of 59,000 tons, of which 27,000 tons were exported.
The honorable member for Yarra (Dr. J. F. Cairns) has dealt with some of the advantages and disadvantages that can be seen in the Agreement. I think we should say that this provision is inserted at the request of the New Zealand Government. It sees advantages to its people in exports of cheese at this rate. We see advantages to the Australian people in cheese being imported at this level and we do not see any danger to the Australian dairy farmer, despite the remarks of the honorable member for Griffith (Mr. Coutts). The facts have already been fully stated by the Minister for Trade and Industry (Mr. McEwen) on more than one occasion, and therefore I do not intend to canvass them again. I remind the House that we are talking about imports up to a maximum in five years of 1,000 tons of Cheddar cheese. Chese consumption in Australia over a five year period increased by 5,400 tons, which is more than 1,000 tons a year. As we can see the annual consumption in Australia increasing, we think that this provision has advantages for Australian consumers. It has no dangers for the Australian dairymen and it will help the New Zealand farmers. For these reasons, we think the amendment should be rejected.
.- I support the remarks of the honorable member for Yarra (Dr. J. F. Cairns) on this amendment. People who are interested in primary industry in Australia know that dairy farmers in Queensland face extremely difficult problems. Dairy farmers in Queensland are loud in expressing their opposition to the Government’s proposals which are set out in the Agreement. I travel quite extensively to meetings of the Queensland Dairymen’s Organisation and I am frequently asked: “What has happened to the Australian Country Party? We understood that this Party was established originally to defend rural interests, but now the members of the Parly are significantly silent and have failed to defend rural interests.”
– Where has the honorable member been all night?
– I have often heard, for instance, the name of the honorable member for Gippsland (Mr. Nixon) mentioned as a person who sold out the small country man. 1 do not know whether this is true, but it has been suggested. The honorable member for Griffith (Mr. Coutts) assures me that, if 1 have been so informed, my information is reliable, and I suspect that he is correct. Anyway, let us look at the problems of the dairying industry and specifically at the production of cheese. We already export cheese. If we import more cheese, we must export a greater volume of cheese. Because of the present world prices, we will have to export cheese at a lower price than we would be able to get on the domestic market. This means that somehow or other we will be fiddling around and providing more money from general revenue for the subsidisation of the industry. I cannot follow the logic in the Government’s recommendation. As the honorable member for Yarra said, the Government claims that the proposal is really meaningless because the amount involved is so small. I wonder whether the dairying industry in Queensland is correct when it complains in a most agitated manner that this is the thin edge of the wedge, that this is the beginning of a European Common Market type of activity. I wonder whether this is intended to offset the effects of the entry of Great Britain into the European Common Market.
I am indebted to my colleague and friend, the honorable member for Braddon (Mr. Davies), who has drawn my attention to a statement made by a person who claims to be an authority on and a spokesman for tha dairying industry. He said -
I said that this -
That is, this Agreement - might be the thin end of the wedge. I want no more of it. This kind of action was based an the false assumption that the European Common Market could handle the matter. But it cannot handle agricultural prices. If our rural industries are to be preserved, they cannot be exposed to this sort of competition. “ On a limited basis “ means that the best matured New Zealand cheese which was available on the Sydney wharves at 3s. 2d. per lb. will now be available on a different basis under the New Zealand-Australia Free Trade Agreement. The tariff of 6d. will be removed off 400 tons of that cheese in the first year of the operation of the agreement. That quantity will rise to the ceiling of 1,000 tons of cheese. Who is to get the 6d. reduction? Is it to go to Woolworths? Will the New Zealand farmer get it? ls the 6d. broken up? That is what we would like to know. If the Government wants to sacrifice the Australian farmer and reduce his standards, this is the way to start doing so. Before the trade officials have another go at this sort of agreement, we should have a look at it.
– Who said that?
– The honorable member for Macarthur (Mr. Jeff Bate), who is a member on the Government side. He was criticising the Government’s recommendation.
– He is the Chairman of the Government Members Food and Agriculture Committee.
– That is right. What is the Government’s proposal behind this Agreement? We discussed this earlier. Members of the Australian Country Party did not say that New Zealand exports its meat, including pig meats, under a guaranteed price arrangement. So meat brought to Australia will be subsidised and may even be dumped. All these aspects should be considered. The point that distresses me is that, although the dairying industry in Queensland faces most pressing problems, which call for the Government to adopt some policy, the Government refuses to do anything. It refuses to set up a committee to inquire into the problems in Queensland and to give an assurance that it will follow up the recommendation of such a committee. This Government has had many inquiries conducted by committees, but it does not follow up the recommendations it receives. The position in Queensland calls for radical action, but, instead of proceeding with some radical action the Government prefers insidiously to squeeze out the dairy farmers in Queensland. This is not the democratic way or the responsible way of solving problems in an industry.
I am not opposed to free trade in a broad sense, but I am concerned about the welfare of people in the Australian community. I am particularly concerned about many dairy farmers, who happen to form a large part of my constituency. I want to ensure that they are not carelessly disregarded and harmed by this Agreement because the Government has failed to provide some offsetting protection for them. I repeat that I cannot see the sense in the Government importing cheese and thus forcing us to sell our cheese overseas at a lower price. This would require some form of subsidisation. The Government should not adopt such a course as this without having a broad plan to help the primary industries in Australia, especially the dairying industry in Queensland. Let me stress that the dairying industry in Queensland needs help. Yesterday, the Minister for Primary Industry (Mr. Adermann) replied to some pointed questions that I had put to him on notice recently. I would have thought that the fact that he had been forced to answer these questions would have led to him to make some definite statement of policy setting out just what was proposed to solve the problems of the dairying industry in Queensland. I repeat that radical proposals are needed. But we have really nothing - a broad statement and no action.
The problems to which I have referred will be hanging about us for some time to come. While we are waiting for them to be solved, people in the dairying industry in Queensland will be forced to accept lower and lower incomes and standards of living. Even in the present situation, the husband and wife and all the children are working on dairy farms. I can remember that in the days before the war the very low standard on dairy farms was a problem. People worked with very poor machinery, if any, and their surroundings were most uncongenial. The husband and wife and all the children worked. The children were so tired when they reached school that they would fall to sleep in the classrooms. This sort of thing disappeared after the war. Honorable members will remember that the Labour
Party had some policies which rehabilitated the industry to some extent. But these things are returning. I have talked to school teachers in country areas in my electorate who have pointed out that they have to make special allowance for some children from dairy farms. They know that these children rise extremely early in the morning and do work that adults would normally be expected to do. The children come to school and then go home and do the milking again. This kind of thing is returning. As people who are interested in humanitarian values we should not tolerate it. We should feel a very real responsibility and a very great sensitiveness about this situation developing in the community. We should be doing something about it. I think that members of the Country Party have a responsibility, instead of sitting by mutely, to speak up and mouth exactly what the problems are that the dairying industry in Queensland and the northern rivers area of New South Wales is facing. They should tell us what they intend to do about it. If they are influenced by these things and will be forthright and come out with a constructive policy I am certain they will find wholehearted support from members on this side of the chamber. But if they play around and allow the position to get worse, and allow unfortunate people to suffer in the meantime, then they are going to meet a lot of opposition and certainly be subjected to some very stringent attacks as far as I am concerned.
.- This has been another remarkable example of debating. First, the honorable member for Yarra (Dr. J. F. Cairns), during the course of a rather emotional speech, accused the Minister for Trade and Industry (Mr. McEwen) of producing another trumped up trade agreement not worth the paper it is written on - to use the honorable member’s own words. I suppose the honorable member for Yarra was in this House when the Japanese Trade Agreement came before the Parliament and was one of those who not only voted against it, he probably also spoke against it. Today the Japanese Trade Agreement is worth more to Australian primary producers than anything the Labour Party ever did in any State Government or the Commonwealth Government in all its existence.
Now we hear from the hack from Hayden - the hack from Oxley who could not even get past a gallop.
– I rise to a point of order.
– Order! I remind the honorable member for Gippsland that the correct term is: “ The honorable member for Oxley “.
– I now have a proper understanding of the problem in Queensland because we just heard it mouthed by the honorable member for Oxley (Mr. Hayden). It is no wonder that the dairy farmers in Queensland are worried, when their whole position is misrepresented so badly and so unfairly as we have just heard it misrepresented by the honorable member for Oxley. Let me put the position squarely. The production of cheese in Australia in the year 1964-65 was 59,000 tons. Imports of cheese in 1964-65 were 260,000 tons, including cheese from New Zealand. There has been no definite quantity limitation on cheese from New Zealand before, but there will now be a definite quantity limitation. There can be no import of New Zealand cheese of more than 1,000 tons a year, at the most, after the fifth year and there will be only 400 tons imported in the first year of the Agreement. Coincidentally wi.h this it seems that consumption of cheese in Australia is rising at a rate of more than 1,000 tons a year. These figures certainly do not give evidence of damage to the industry and certainly should not produce fears in the minds of the dairy farmers of Queensland. I. am quite sure that the dairy farmers of Queensland have been misled very badly by the Opposition in this Parliament. I make that as a positive statement.
Another interesting point is that the spokesmen for the cheese industry are the Australian Dairy Produce Board in Australia and the New Zealand Dairy Board in New Zealand. These two Boards agree on the price between them. If anybody should know about price arrangements for cheese coming into Australia it should be the spokesman for the industry, namely the Australian Dairy Board. The Australian Dairy Board will meet with the New Zealand Dairy Board and will fix the price. In those cir cumstances one is somewhat at a loss to know what the honorable member for Oxley is talking about. I do not think he has any real understanding of the position in the dairying industry at all.
.- The honorable member for Gippsland (Mr. Nixon) reminded me very much of Mrs. Murphy’s dog. Figures given to me by the Minister for Customs and Excise (Senator Anderson) indicate that for the year 1964- 65, 290 tons of cheddar and epicure cheddar cheese were imported from New Zealand into Australia. On this cheese a duty of 5 cents or 6d. per lb. was paid. Those imports are going to be stepped up to 400 tons in the first year of the New Zealand-Australia Free Trade Agreement, yet honorable members say that that is not going to have any effect on the local industry. It is true, as the Minister for Air (Mr. Howson) has said, that consumption of cheese in Australia has increased. This might be due to the increased intake from European countries of people used to eating more cheese than meat. There are various reasons for the increase. Some of the imported cheeses have improved in quality. We do import a number of fancy cheeses. I think that more should be done to encourage the production of these fancy cheeses in Australia. Some of us do not have the strong will of the honorable member for Griffith (Mr. Coutts) to be. able to refuse these fancy imported cheeses just because they are not produced in Australia. The point is that in five years time we will be importing 1,000 tons of cheese, and now we are exporting quite a quantity of cheese.
In 1962-63 we held 7,992 tons of cheese in cold stores in Australia and were looking for a market for it. It was only because sales were arranged with Japan and because of the harshness of the winter in Europe - which not only assisted us in this regard but also in the sale of sugar - that we were able to sell a great quantity of surplus cheese on the European market. If we double the amount of cheese coming into Australia we will lift the amount of duty collected on it. I do not know who is to get the benefit of this. I would be very interested to know whether the benefit will be passed on to the consumer. I know that there has been talk of the Australian Dairy Board selling Australian cheese in New Zealand. Good luck to it if it can. I know that the Board is spending money to this end. The point I make is that if we are importing such a large quantity of cheese similar to the types of cheeses we manufacture, and at the same time are trying to sell cheese overseas, we will be placing an additional load on the producers in Australia who are contributing to an equalisation scheme which was introduced to guarantee them a fair price. For these reasons I must oppose the measure that is before the House.
– The honorable member for Oxley (Mr. Hayden) has once again treated the House to a tale of depression in the Queensland dairying industry and has tried to give the impression, as he did on a previous occasion, that the New ZealandAustralia Free Trade Agreement will accentuate the position. Let us get down to facts. No one denies that the Agreement will affect the Queensland dairy farmer. But by how much is it going to affect him? In the first year it is going to cost him, in terms of actual cash, 30s., when imports are increased from 260 tons to 400 tons. When imports increase to 1,000 tons it will cost him f 8 or $16. That is on a yearly basis and when imports get to the full amount. Those facts were given to the Queensland Dairymen’s Association on 8th September in a speech by the Minister for Trade and Industry (Mr. McEwen) from which the honorable member for Yarra (Dr. J. F. Cairns) has quoted widely. During this speech, and arising from interjections that were made during the speech - I am glad that the honorable member for Yarra has referred to this matter - the key to the problem of the Queensland dairy industry was raised by the dairy farmers and was agreed to by the Minister. It is the problem of not having a legume and the need to do research - some is being done - to improve the industry and to give it an equal opportunity with the industry in other States. It appeared, one of the members of the dairymen’s organisation said, that if the legumes could become available and sufficient extension were provided, there could be as dramatic an increase in production as in the southern States, particularly Victoria. The dairymen agreed at the meeting that this was the key to the problem. The key is not to be found in a trade agreement. As the Minister has pointed out during this discussion, the quantity of cheese consumed within Australia is increasing at an average rate of 1,000 tons a year. I agree that we shall still have to export a small quantity of cheese if we intend to import some of the New Zealand cheese but the overall position in Australia is an improving one. The particular problem in Queensland has been exaggerated by the honorable member for Oxley, I think, in a rather unfair and dishonest manner so far as this measure is concerned. The cost is minimal. The key to the problem in Queensland is not in the terms of the Trade Agreement but is in terms of improving the methods of production within the State.
.- I was very interested in the speech of the honorable member for Oxley (Mr. Hayden). He said that when he travels around the country to attend meetings people ask: What has become of the Country Party? Has anybody imagination vivid enough to visualise people saying to the honorable member for Oxley: “ What has become of the Country Party? “ Of course, this is a figment of his own imagination. He would go along to a meeting and perhaps say such things, but even the Opposition must regard it as a great joke for a member to come into the Parliament and to say such a thing. This is highly ridiculous. I am glad to see members of the Opposition join in the amusement that he has caused.
The honorable member wanted to get the sympathy of the people and he pulled out all stops in order to do so. He spoke of the poor children who go to school tired from having worked on the dairy farms. The Mallee is a wheat growing electorate where there is no dairying industry and some farmers do not have even one cow on their property. I could take him to areas like Murrayville or to consolidated schools throughout the Mallee and show him little beds in a certain room where children sleep during the day because they have travelled long distances on school buses. The honorable member for Oxley has spoken a half truth. He has said that children from dairy farms are so tired after working on the properties that they fall asleep at school. Children fall asleep in the wheat growing areas, too, and special accommodation is provided to enable them to take a sleep. I want to be quite fair to the honorable member-
Order! I ask the honorable member to relate his remarks to the subject under discussion.
– I am just answering matters raised by the honorable member. I wrote down what he said. It appears to me that the honorable member for Yarra (Dr. J. F. Cairns), who is moving the amendments on behalf of the Opposition and the honorable member for Oxley are living in the past. The honorable member for Yarra spoke about the effect of these amendments and the great uproar against the Government for relaxing the tariffs on New Zealand goods coming to Australia. In that comment he is about as up to date as he was when he quoted a critical report from a newspaper of last December and said that the Agreement did not come into operation until January. He quoted one effect of the Agreement before it had come into operation, and the Labour Party stirred up the people by claiming the Agreement would bankrupt them. Now that people’ have had some experience of the operation of the Agreement, I have not heard any outcries against it. 1 should like to draw to the attention of honorable members the fact that the uproar, if it can be so called, created by the Opposition against these measures is as nothing compared with the uproar against the Government over the signing of the Japanese Trade Agreement some years ago. Honorable members opposite do not like me to mention this, but every Opposition member in the House at the time was pledged to rescind the Agreement at the first opportunity.
– Do not be silly.
– The honorable member for Scullin is one who had most to say against it. I can produce “ Hansard “ reports to show that honorable members opposite are pledged to rescind the Japanese Trade Agreement at the first opportunity. But what do we hear about that Agreement today? We hear the honorable member for Scullin denying that he opposed it, yet I can bring pages of “ Hansard “ to show his opposition to it.
– I said that the Government sold out Australia, and so it did.
Order! Proceedings are getting a little away from the point. We should be discussing cheese and curd.
– I know that we are discussing the importation of cheese, but I was just replying to the overall opposition advanced by honorable members opposite and commenting on what it appeared to be and what it really is. Of course, I shall vote against the amendment.
.- When one first looks at this proposal one would think, as some Labour Party speakers have, said, that the provision might take away some of the market which should belong to Australian dairy farmers; but after giving the matter much consideration one realises that it has exactly the opposite effect. The science of marketing rural commodities is a very intensive study. On first looking at the situation one would probably do what the honorable member for Yarra (Dr. J. F. Cairns) has done and, with a superficial knowledge of marketing, one might think that the New Zealand-Australia Free Trade Agreement will damage the market available to the Australian dairy industry, but this is not so. It is quite incorrect. I think the main point is that exports of cheese from New Zealand to the United Kingdom and other countries totalled 93,000 tons in 1964-65. The consumption of cheese in Australia in the last year for which information is available was 32,000 tons. In other words, New Zealand exports three times as much cheese as Australia consumes.
If anything happened to the New Zealand market in the United Kingdom or in other countries she could flood Australia with cheaper cheese and probably wipe out completely that part of our dairy industry. New Zealand is in a commanding position in respect of the cheese that she exports. As one of the Opposition speakers has pointed out, New Zealand is landing Anchor brand cheese, which is the main export brand, on the Sydney wharves at 3s. 2d. per lb., after paying duty. That is less than the premium price for Australian cheese in Sydney. New Zealand was landing between 200 and 400 tons of cheese in Australia each year and it was freely available here so long as the duty was paid. I put it to the Committee that the mistake made by the honorable member for Yarra and by other Opposition speakers was due to the fact that they did not take into account the point that New Zealand could have flooded the Australian market at any time, so long as she paid the duty of 6d. per lb. The New Zealanders are now in the position where they cannot export more than 400 tons for the first and second years, 800 tons for the third and fourth years and a maximum of 1,000 tons for the fifth and subsequent years following the entry into force of the Agreement. In other words, the New Zealanders, with an exportable surplus of 93,000 tons, will not be able to send more than 1.000 tons to the Australian market. The New Zealand Dairy Produce Board has made a mistake in the Agreement.
– Do not wake it up.
– The honorable member for Gellibrand is beginning to see daylight, but do not wake up the honorable member for Yarra (Dr. J. F. Cairns) to this matter because he has moved an amendment. There is a great deal of trepidation in Commonwealth countries concerning Britain’s proposed entry into the European Common Market. If Britain enters the Common Market, New Zealand may lose a sizeable proportion of its United Kingdom trade. New Zealand will be looking for other markets.
As I have pointed out, New Zealand has an exportable surplus of 93,000 tons of cheddar cheese each year. Under this Agreement it will be restricted to 400 tons for the first and second years phasing up to 1,000 tons for the fifth and subsequent years. I think that the Committee might be a little sophisticated in looking at this problem because the cheese industry is unlike the butter industry. No New Zealand butter comes into Australia. It does not matter where butter is made. A pound of butter is a uniform article, as is the “ Sydney Morning Herald “ newspaper or a bottle of milk. But with cheese it is quite a different matter. New Zealand cheese is different from Australian cheese. I have been informed that the Japanese are buying Australian cheese in preference to New Zealand cheese because Australian cheese suits the Japanese palate. The Japanese are buying approximately 2,500 tons of Australian cheese each year.
I believe that the Australian consumer is entitled to satisfy his taste in respect of a commodity which is different in make, packaging, origin or type. In other words, if the Australian consumer, or the New Australian consumer for that matter, desperately wants to buy Swiss cheese, Dutch cheese or Danish cheese and is prepared to pay for it and also to pay the duty on it, he should be able to purchase it. At the moment there is an application before the Tariff Board for the imposition of 2s. 6d. per lb. duty on imported fancy cheese. I do not think that it applies to New Zealand cheddar cheese. The application has been filed with the Tariff Board by the cheese industry, which is currently going into the production of fancy cheese. Some honorable members have said that we should consider the production of fancy cheese. This is being done with some success in Australia. A great deal of fancy cheese is being produced.
New Zealand, with a total of 93.000 tons of exportable surplus cheese, will be able after the fifth year of the Agreement to send only 1,000 tons of cheese to Australia. That is a restriction on the importation of New Zealand cheese. No matter what happens in the Common Market or in connection with New Zealand’s overseas trade in cheese, New Zealand cannot send more than .1,000 tons to Australia. In other words, when honorable members speak about a damaging entry, what they are forgetting is that this restricts the entry of cheese from possibly 90,000 tons to 1,000 tons. Cheese is produced in the electorate of the honorable member for Eden-Monaro (Mr. Allan Fraser). As a matter of fact, all of the premier cheese that is produced in New South Wales comes from his electorate, and it attracts 4d. per lb. more than Victorian matured cheese of the highest quality. The honorable member for EdenMonaro will notice that the cheese makers in his electorate are protected by this Agreement.
On first look it might have appeared that the Agreement would be damaging to the dairy industry, but when one examines it most carefully and considers all the aspects of taste, quality, uniformity, standards and the rest, one sees that it is a restrictive move. In my view, the New Zealand Dairy Produce Board should never have signed the Agreement because it has restricted the export of the vast bulk of its exportable cheese to a total of 1,000 tons in perpetuity, so far as I know. The Board cannot get over this position unless, of course, there are provisions in the Agreement which provide for ‘reconsideration. New Zealand has blocked off its market in Australia which, of course, should be a rich market because Australia is rapidly becoming ta industrial nation and a mineral exporting nation. Australian markets are important to New Zealand, but New Zealand has signed an agreement under which it cannot send more than 400 tons of cheese to Australia this year or more than 1,000 tons after the fifth year.
The dairy farmer of Australia is protected in this way. If our trade officials are responsible for this position, then they have brought off a coup in reducing the importation of New Zealand cheese to 1,000 tons a year. It cannot rise above 1,000 tons. Maybe the Opposition does not like what I am saying because it has made a move to delete this provision from the Agreement. The Opposition has made a mistake because it has only a superficial view on the marketing of rural commodities. In these circumstances, what was thought to be a loss of market to the dairy industry is, in fact, a protection of the market because, apart from fancy cheeses, New Zealand will be the only possible exporter of cheddar cheese to Australia. New Zealand is a heavy producer of cheese. It has a very great dairy industry which has the benefit of one inch of rain a week. New Zealand dairy farmers can run four cows to the acre in contrast to the lower Australian figure. Yet New Zealand has signed an agreement which limits its exports of cheese to Australia to 1,000 tons for the fifth and subsequent years. I say that the Opposition, having made a mistake on the Japanese Trade Agreement, is now making a mistake on the New Zealand-Australia Free Trade Agreement.
– We have just heard a very interesting speech from the honorable member for Macarthur (Mr. Jeff Bate), but I believe that there is an answer to the speech that he has made. I think that 1 ought to quote the answer because it was given by the honorable member himself when speaking in this House on 20th October last year.
– It has been quoted.
– I propose to quote it so as to follow what the honorable member for Macarthur has said. It is true that earlier tonight a few extracts from this speech were quoted. They did not deter the honorable member for Macarthur, nor has he attempted to explain to the Committee the complete change in his attitude and outlook.
– If the honorable member had listened he would know that I have explained it.
Order! The honorable member for Macarthur has already spoken.
– If the honorable member now considers that he was entirely wrong in what he said on 20th October 1965 he should get up and say so.
– I got up and said so.
– No. Let the
Committee hear what the honorable member for Macarthur said.
– The honorable member is bringing politics into this.
– Yes, I think there is some truth in that suggestion but, of course, these are all political matters. The honorable member for Macarthur said -
There is no escaping from these facts. They ere true. Now the dairy industry has to meet the competition of low priced commodities from New Zealand and no tariff is to be imposed on them.
He knew the facts. The then Minister for Territories (Mr. Barnes) interjected and said -
On a limited basis.
The honorable member for Macarthur said -
Yes. I said that this might be the thin end of the wedge. I want no more of it.
I gather that he now wants a lot more of it. He continued -
This kind of action was based on the false assumption that the European Common Market could handle the matter. But it cannot handle agricultural prices. If our rural industries are to be preserved, they cannot be exposed to this sort of competition.
Does he still believe that? He took up this question of “ on a limited basis “ and he knew very well what he was talking about. He said - “ On a limited basis “ means that the best matured New Zealand cheese which was available on the Sydney wharves at 3s. 2d. per lb. will now bc available on a different basis under the New Zealand-Australia Free Trade Agreement. The tariff of 6d. will be removed off 400 tons of that cheese in the first year of the operation of the Agreement. That quantity will rise to the ceiling of 1,000 tons of cheese. lt is quite clear that the honorable member for Macarthur knew perfectly well what the position was. Hear his peroration -
Who is to get the 6d. reduction? ls it to go to Woolworths? Will the New Zealand farmer get it? Is the 6d. broken up? That is what we would like to know. If the Government wants to sacrifice the Australian farmer and reduce his standards, this is the way to start doing so.
– Who said that?
– The honorable member for Macarthur.
– Does he still believe that?
– Apparently not. 1 do not know what changed his mind. He has not given an explanation for his complete change of attitude. He continued -
Before the trade officials have another go at this sort of agreement, we should have a look al it. I would like to know the names of the people who conferred with the Government on this matter and gave their okay to it. Let them come out into the open.
– interjectedxx lt was the Australian Dairy Produce Board.
The honorable member for Macarthur flattened him by saying -
The honorable member for Maranoa has a lovely feeling of irresponsibility because he will not be sitting in this House very much longer. . . To me it is a serious matter. The principle which has been observed in formulating trade agreements all these years has been changed, so radically and so tremendously. I say again: If the Government wants to destroy the rural community, this is the way to do it.
How much importance, how much weight, are we to place on the words of the honor able member for Macarthur tonight when we contrast them with his words on 20th October 1965 when he said -
If the Government wants to destroy the rural community, this is the way to do it. Have a look at the future reservoir of population in Australia It is the rural community. The large families are in the country. President de Gaulle knows that the rural community is the reservoir of nationalism and patriotism in France. A lot of people seem to want to pull down the dairy industry but they should have a look at what would be the sociological effect if this happened.
The honorable member for Maranoa (Mr. Brimblecombe) again interjected and said -
Who fixed the price?
The honorable member for Macarthur again flattened him by saying -
.- 1 do not know whether the honorable member for Eden-Monaro (Mr. Allan Fraser) dislikes me. He thinks that mine was a very good speech last year. As a matter of fact I was fascinated with his rendering of my poor words.
– He made them sound better than the honorable member himself did.
– That is true. I am indeed flattered that the honorable member for Eden-Monaro used up his time in the Committee stages of this Bill to quote from a speech of mine and to do it wilh such distinction. I am grateful to him and thank him, but I think that underneath his flattery was the subtle idea that he was proving me wrong on the subject matter before us. I remind the Committee that I said that on a superficial look - at first look - it would appear that the dairy industry would be damaged. The honorable member for Yarra (Dr. J. F. Cairns) adopted the line so ably rendered by the honorable member for Eden-Monaro. I said six months ago what’ I thought of the trade agreement at first look. I commend the honorable member for Eden-Monaro for his reading of my speech and for studying so carefully what I said. Perhaps he is carefully watching what I say about the dairy industry to improve his knowledge. Tonight he pointed out exactly what I said as a result of my first look at the New Zealand trade agreement - that it’ might harm the industry. The present measure is a move to restrict the quantity of New Zealand cheese coming to Australia. Honorable members opposite can wave their arms about, but the Standing Orders state that an honorable member can speak for two 15-minut’e periods during a Committee stage of a bill, so they can take what I am saying whether they like it or not. After discussing the agreement with the industry, and after carefully looking at all aspects of it, I believe that we have succeeded in limiting the importation of New Zealand cheese and protecting our own market. This year, because of drought conditions, there will be 3,500 tons less Australian cheese available and it could be that New Zealand could have sent that quantity to Australia, but under the agreement New Zealand imports are limited to 400 tons this year. If honorable members look at some of these measures when they are in front of them for only a few minutes, and then make a decision which is wrong their error ought to be put right. The Opposition will be put right tonight because it has made a wrong decision on this matter. The honorable member for Eden-Monaro has pointed out how easy it is to make a wrong decision about this. I made a wrong decision seven months ago - last October. Tonight I am putting the record straight in regard to this matter. I want also to put the Opposition straight on it because the honorable members opposite do not understand. Perhaps the honorable member for Lalor understands what I am talking about.
– I have never understood the honorable member for Macarthur.
– The honorable member for Lalor has understood me because I have seen his face pretty red. I do not know what was making his face red if he did not understand me. He gave the meat away to Great Britain and made an agreement with New Zealand for the sale of cheap wheat to that country. I think the honorable member for Lalor understands what I am talking about even if some of the other honorable members opposite do not understand. But this amendment is wrong. It is incorrect and it will not help the dairy industry. People in the dairy industry will know that it will not help when they find out the facts.
– No-one believes the honorable member any longer.
– The honorable member for Lalor may crow away like a rooster but the people in the dairy industry will not be thanking the Labour Party for this amendment and they will not support the Labour Party because of it. The honorable member knows that the industry will not support his Party. As I pointed out, this amendment will restrict the importation of cheese from New Zealand. There is a vast reservoir of this commodity in New Zealand - 93,000 tons of it. New Zealand produced 105,000 tons in 1965, consumed 12,000 tons and exported 93,000 tons. That is the amount of cheese available a short distance away at a time when the consumption of cheddar cheese in Australia is only 32,000 tons. New Zealand exports three times as much as we consume. Honorable members should get that straight. New Zealand exports three times as much cheddar cheese as we consume in Australia at the present time.
– What about our surplus?
– We have a surplus this year-
– I rise to order. I would like to know whether it is in order for the honorable member for Macarthur to continue with this tedious repetition of a speech he has made, to stand as he is with one leg cocked up on the top of the bench, his hands in his pockets, picking his teeth, and making inane remarks?
Order! There is no substance in the point of order. The honorable member for Macarthur may continue.
– Honorable Members of the Opposition drew attention to something which is important; that is, tha amount of fancy cheese being imported into Australia. About £1 million worth of fancy cheese - between 2,000 and 3,000 tons - is imported. It was pointed out that this matter should be looked at. This cheese is consumed to some extent by the people who come to Australia from overseas because they retain their local tastes. Danish people want to have Danish cheese. Germans and Italians want cheese manufactured in their respective countries. This is understandable. Until Australia can fill this demand we will continue to import this fancy cheese which is costing a great deal of money in foreign exchange.
It so happens that during World War 11 some Australians were in Cairo. We found there that Australian fancy cheese was preferred by the Greek grocers to European cheese. Apparently we were making a good fancy cheese. Today a number of Australian companies are making good fancy cheeses. The Down Co-operative Dairy Association Ltd. is making a good Danish blue vein cheese and the Maglagan Valley Co. is making a good Edam type cheese. Australian producers are beginning to fill the need for these cheeses. They will require some small measure of protection. This matter is being fought out now before the Tariff Board.
In my opinion the Opposition has made the mistake that 1 made of looking al this matter hurriedly and superficially, lt has acted in haste and without careful consideration in an endeavour to gain some support from the dairy industry, but it has made a mistake.
Question put -
That the letters, figures and words proposed to be omitted (Or. Cairns’s amendment) stand part of the Tariff Amendment.
The Committee divided. (The Temporary Chairman - Mr. E. H. Drury.)
Question so resolved in the affirmative.
Tariff Amendment agreed to.
Tariff Amendments 6 to 9- by leave - taken together, and agreed to.
Bill returned from the Senate without amendment.
House adjourned at 11.24 p.m.
The following answers to questions upon notice were circulated -
y asked the Minister for Trade and Industry, upon notice -
What were the total amounts of shipping freight paid on (a) exports and (b) imports during 1964-65 and what amounts have been paid during the current financial year to date?
– The answer to the honorable member’s question is as follows -
The Commonwealth Statistician has advised that freight payable overseas on imports during 1964-65 and the first half of 1965-66 is estimated as follows -
Statistics are not available to show the total annual freight charges for exports, which, by the conventions of balance of payments accounting, do not form part of the Australian balance of payments.
s asked the Minister representing the Minister for Works, upon notice -
– The Minister for Works has supplied the following information -
n asked the Minister for Primary Industry, upon notice -
– The answers to the honorable member’s questions are as follows -
Cite as: Australia, House of Representatives, Debates, 27 April 1966, viewed 6 July 2017, <http://historichansard.net/hofreps/1966/19660427_reps_25_hor51/>.