Senate
9 May 1962

24th Parliament · 1st Session

  1. Senate
  2. 24th Parliament
  3. 1962

The PRESIDENT (Senator the Hon. Sir Alister McMuliin) took the chair at 3 p.m., and read prayers.

page 1211

QUESTION

IMMIGRATION

Senator SANDFORD:
VICTORIA

– Has the Minister representing the Minister for Immigration seen a report in yesterday’s Sydney press, under the very prominent headline, “ Killers Allowed to Come Here “, to the effect that 300 of the poorest type of Italians, including murderers, had been given a chance to enter Australia? This statement was reported to have been made by Judge Holden, of New South Wales. If there is any truth in it, will the Minister make a statement to the Parliament setting out the conditions governing the entry of these persons, who were apparently unwanted in New Calendonia?

Senator HENTY:
Minister for Customs and Excise · TASMANIA · LP

– Yes, I did see the statement in the press and I immediately consulted my colleague, the Minister for Immigration, because I thought, of course, it would be of interest to the Senate to have as many of the facts of this matter as can be given at the moment. The Minister advises me that Australia has never recruited migrants from New Caledonia. In 1954, a group of Italians who had been working in an isolated mine 200 miles to the north of Noumea, entered Australia on transit vises issued in Noumea, en route to Italy. A mining company apparently had been employing a large number of mine workers, but because of a depression in the chromium ore market the company had given the opportunity to any of the workers who wished to return to Italy to leave before the conclusion of their three years’ contract. Sixty-two Italians arrived in Australia on transit vises between June and November, 1954, and of these 44 left and returned to Italy. The remaining eighteen Italians sought approval to remain in Australia, as soon as they arrived here with transit visés. The Italian Consul-General in Sydney made representations to the department that these men should be permitted to remain. Their applications were considered and on 14th January, 1955, approval was given for the men to remain,- provided that they met our normal immigration requirements, and that each of them undertook to remain in essential work as directed for a period of two years. The position is being further investigated at present. The Minister has ordered a full investigation of the position. That is all that I can report to the Senate.

page 1211

QUESTION

FIBROMA

Senator MCKELLAR:
NEW SOUTH WALES

– Has the attention of the Minister for Health been directed to the statement made, it is reported, by Dr. Shope, the American discoverer of the anti-myxomatosis virus fibroma, that the virus can be transmitted from domestic to wild rabbits, and to his suggestion that if domestic rabbits were to be immunized they should be housed in insect-proof hutches? In view of these statements and the potential threat to primary producers from a possible rabbit plague, can the Minister say that the use of fibroma will not constitute a danger to the primary producers in Australia?

Senator WADE:
Minister for Health · VICTORIA · CP

– Dr. Shope’s report, to which the honorable senator referred, has been received only quite recently, and I have not yet had an opportunity to study it. I should like to have that opportunity before giving a considered opinion on the matters that have been raised by Senator McKellar. The introduction of fibroma virus is a matter of very great concern to the primary producers of Australia - so much so that it is currently being examined by the Standing Committee of the Australian Agricultural Council. I assure Senator McKellar that I shall examine the report with the least possible delay and convey to him my considered opinion on this matter.

page 1211

QUESTION

NUCLEAR TESTS

Senator BRANSON:
WESTERN AUSTRALIA

– Can the Minister representing the Minister for External Affairs inform me how many banthebomb demonstrators visited Canberra yesterday? Are the press reports correct in stating that the group failed in attempts to see senior Government members? Did similar protest or demonstration parties visit Canberra when the Russians recommenced nuclear bomb testing? If so, were those demonstrators successful in seeing senior Government members?

Senator GORTON:
Minister for the Navy · VICTORIA · LP

– I cannot give specific answers to the questions asked by the honorable senator. Certainly a very small number o.” these people arrived in Canberra yesterday. I understand that they arrived by air, but perhaps a few travelled by bus. In a photograph that I saw the group appeared to consist of about 50 people. They were carrying a banner stating that they represented a larger number of people. That number may or may not have been accurate. I am not aware that they saw or approached any senior Minister. Certainly I do not recall a similar interest being shown when the Union of Soviet Socialist Republics first broke the self-imposed moratorium on nuclear tests last year.

page 1212

QUESTION

AIR FARES

Senator MARRIOTT:
TASMANIA

– My question is directed to the Minister for Civil Aviation. Yesterday I asked the Minister why air fares for the journey between Sydney and Wellington were greater than those for the longer journey between Melbourne and Perth. The Minister explained that for various reasons international airline costs are greater than those applicable to Australian domestic airlines. Is it not obvious that tourism between Australia and New Zealand would be greatly increased if air fares for journeys between the two countries were lowered? Would not this increase be of benefit to both countries? Does the Minister consider that this could be another reason for Australia and New Zealand to come closer together administratively? If, for example, New Zealand became the seventh Australian State, would domestic airlines then operate between the two already closely allied countries?

Senator PALTRIDGE:
Minister for Civil Aviation · WESTERN AUSTRALIA · LP

– I have no doubt that lower fares would attract greater patronage of the air services operating between Australia and New Zealand. However, for the reasons which I gave yesterday and for other reasons, fares lower than those at present charged would simply not be a commercial proposition for the companies operating on this route as members of the International Air Transport Association. I noted the honorable senator’s reference to the possibility of New Zealand becoming the seventh State of Australia and to tourism as possibly making that attractive. I have also noticed recently - no doubt the honorable senator has, too - the views expressed by the New

Zealand Prime Minister on this subject. He has made it quite clear that he does not share the enthusiasm shown in certain quarters of Australia for this proposal.

page 1212

QUESTION

SUPERANNUATION

Senator PALTRIDGE:
LP

– The honorable senator was good enough to bring to my notice the article to which he has referred, and I have also seen other press reports dealing with the same subject. 1 can inform him that no amounts have been invested by the Superannuation Board or the Defence Forces Retirement Benefits Fund in Stanhill stock or in any other stock of the kind. I am not aware, nor have 1 been able to find out, that any other Commonwealth funds have been so invested.

page 1212

QUESTION

TELEPHONE SERVICES

Senator VINCENT:
WESTERN AUSTRALIA

– My question, which is addressed to the Minister representing the Postmaster-General, relates to disconnected telephone services. I am informed that the signal given to a person who dials the number of a disconnected telephone service is similar to or identical with the signal which indicates that a telephone service is engaged. That is to say, if a person unwittingly rings the number of a disconnected service, he receives the same signal as if the number he was ringing were engaged. I have had brought to my notice the fact that, after a doctor in Perth had changed his address, his telephone was disconnected and some of his patients were put to great inconvenience because they continued to ring the disconnected number, thinking that they were receiving an “ engaged “ signal. Would it be possible for the Postmaster-General to provide a different type of signal noise to indicate that a telephone service had been discon.nected? I point out that in some countries an automatic voice recording is used to inform people who ring a disconnected service that the telephone has been disconnected.

Senator WADE:
CP

– The honorable senator has raised an interesting matter, which I shall bring to the notice of the PostmasterGeneral. I think it will readily be agreed that developments in communications in Australia place this country in world class. If other countries have reached the stage of using automatic voice recordings in the circumstances mentioned by the honorable senator, I believe that sooner or later Australia will be able to provide the same facilities.

page 1213

QUESTION

SULPHATE OF AMMONIA

Senator DRAKE-BROCKMAN:
WESTERN AUSTRALIA

– I address a question to the Minister for Customs and Excise. Is it a fact that, following a report of the Tariff Board, the Government has announced that a bounty will be paid to Australian producers of sulphate of ammonia? Is it correct that the rate of bounty will be £2 per ton on domestic sulphate of ammonia used for fertilizer? Also is it correct that the. bounty is to operate from 1st April, 1962? Has the Minister’s attention been directed to the fact that orders for nitrogenous manures in Western Australia are still being fulfilled at the price ruling before the Government’s announcement? Will the Minister take action to ensure that the benefit of the subsidy is passed on to purchasers of sulphate of ammonia in Western Australia so as to reduce the price of sulphate of ammonia to approximately the 1960-61 level for all orders placed after 1st April, 1962?

Senator HENTY:
LP

– Yes, it is a fact that the Tariff Board, after inquiry, has recommended that a bounty of £2 per ton be paid on sulphate of ammonia on and after 1st April, 1962. The requisite legislation, which has yet to be passed by the Parliament, makes the bounty retrospective to 1st April, 1962.

page 1213

QUESTION

SOCIAL SERVICES

Senator TANGNEY:
WESTERN AUSTRALIA

– My question is addressed to the Minister representing the Minister for Social Services. Is it a fact that for more than seven years there has been no alteration in the amount of permissible income which a pensioner may earn - that is, £2 per week - before he is debarred from receiving medical benefits under the pensioner health scheme? In view of the hardship that this situation causes, and in view of the changes that have taken place in the past seven years in the value of money, will the Minister consider reviewing this matter when the next Budget is being prepared in order that the permissible income of these pensioners may be brought more into line with the liberalized means test?

Senator SPOONER:
Minister for National Development · NEW SOUTH WALES · LP

– T!i:s is a matter that will be taken into account at Budget time. It is a matter for negotiation with the Australian Medical Association.

page 1213

QUESTION

HELICOPTER SERVICES

Senator LAUGHT:
SOUTH AUSTRALIA

– Has the Minister for Civil Aviation anything to report on the development of helicopter services in South Australia? Is he aware that at least one recently erected building in Adelaide - the Adelaide “ Advertiser “ building - has made provision for helicopters to land on its roof? Is the Minister aware that a master plan for the development of Adelaide’s metropolitan area, prepared by the town planner, Mr. S. B. Hart, is almost ready for submission to the State AttorneyGeneral and then, no doubt, to the Parliament of South Australia? The plan, I understand, covers a vast area of the Adelaide plains extending from Gawler in the north for a distance of 50 miles in a southerly direction - well beyond the present metropolitan area. Does the Minister envisage the operation of helicopter services in the foreseeable future between a number of points in this planned area? Have consultations been taking place among officers of the Department of Civil Aviation and the town planner concerning the reservation of appropriate helicopter landing sites or areas in this planned portion of the Adelaide plains? If no discussions have taken place, will the Minister confer with the State and municipal authorities on this matter, in respect of which the South Australian public look to the Department of Civil Aviation for regulation and guidance? Does the department at present license or otherwise regulate the use of helicopter landing fields, or is this matter left entirely to State or municipal authorities?

Senator PALTRIDGE:
LP

- Senator Laught was good enough to inform me that he proposed to ask this question, and I have had a brief reply prepared. There are no helicopter services in operation at present in South Australia. Several helicopters have in the past carried out aerial operations, but no civilian helicopters are based in South Australia. The economics of helicopter operations are extremely difficult with the present generation of equipment, which is much more suited to specialist aerial work tasks than to regular services. Moreover, operations between points within a municipal area would require, for safety reasons, the use of multi-engine helicopters, which would represent a capital investment out of proportion to the available revenue that could be expected in the Adelaide area. It is not thought, therefore, that public helicopter services between points in the area covered by the town plan are likely in the foreseeable future.

My department is aware that a master plan for the development of Adelaide’s metropolitan area is in the course of preparation. The town planning authorities have consulted my department from time to time on the permissible heights of buildings in the vicinity of airports, but have not approached it regarding specific helicopter sites for public purposes. If such consultations were sought, my department would be pleased to discuss the matter with the town planning authorities. I am aware that the Adelaide “ Advertiser “ building has its roof stressed for the use of helicopters. In fact, my department gave information to the owners of the building to enable them to construct the roof in order to cater for helicopter landings. However, the owners of the building have been clearly informed that they cannot expect to be allowed to operate singleengine helicopters from the building. They have been told that any operations from the building must be by suitable twinengine helicopters. Fields to be used for regular transportation by this type of aircraft are required to be licensed by the Department of Civil Aviation.

page 1214

QUESTION

IMMIGRATION

Senator BRANSON:

– Has the attention of the Minister representing the Minister for Immigration been directed to press reports that the British Government is seriously concerned by Australia’s intensive search for skilled British migrants, and that it intends asking Australia to stop seeking specialist migrants, particularly engineering and building tradesmen? Having in mind the’ rapid development that is scheduled to take place in Western Australia and the labour force of skilled migrants that will be required, will the Minister say where the Department of Immigration hopes to obtain skilled migrants in the future? Is it a fact that it is becoming increasingly difficult to attract skilled migrants from Italy, West Germany, Holland, and the Continent generally?

Senator HENTY:
LP

– I read the press report which originated allegedly in Great Britain stating that that country was a little perturbed at the number of its skilled workers coming to Australia. I still think the matter lies within the province of the skilled migrants themselves. If they wish to come here, they will still do so. I agree with the honorable senator that we do need for the development of Australia as many skilled people as we can possibly get.

page 1214

QUESTION

HOVERCRAFT

Senator VINCENT:

– My question to the Minister for Civil Aviation concerns a most interesting press report about a hovercraft in Great Britain which carries some 66 passengers at speeds exceeding 80 miles an hour over both land and water. It is well known to the Minister, of course, that when this craft travels over land, it does not have to use a road. Is the Department of Civil Aviation keeping in touch with developments of this most ingenious and veryimportant new type of craft? I do not know whether it is called an aircraft, a watercraft or a landcraft. If the department is keeping in touch with developments, can the Minister give the Senate any information about this matter? Also, is the Minister considering bringing a hovercraft to Australia to see whether it can be used in this country for passenger and freight carriage?

Senator PALTRIDGE:
LP

– The Department of Civil Aviation is keeping in very close touch with developments which are occurring in connexion with hovercraft and their manufacture. It is true that some prototypes are operating in Great Britain over land, and to a much more limited extent, over water. At present, it is possible for these craft to operate only over flat water. It is not to be assumed that when they operate over land they do not require something in the nature of a permanent way. The craft so far developed, in fact, do require this. It may be just a flat stretch of country lightly bitumenized but nonetheless the craft require some sort of permanent way. There has been no proposal to bring a hovercraft to this country for experimental purposes. It is believed that at the moment it would be of no advantage to do so until further tests are carried out and further types are manufactured in the United Kingdom.

page 1215

QUESTION

CORAL SEA BATTLE CELEBRATIONS

Senator McMANUS:
VICTORIA

– By way of preface to a question to the Minister for the Navy I direct his attention to the controversy at present going on in Victoria about whether the part played by the Royal Australian Navy in the Battle of the Coral Sea has received adequate recognition in the celebration of that battle. Will the Minister indicate briefly the extent to which Australian forces were engaged in that battle and whether he considers that the association of the Australian Navy with the celebrations has been adequate to the part that the Navy played in the battle?

Senator GORTON:
LP

– All the arrangements for the Battle of the Coral Sea celebrations are made by the AustralianAmerican Association in the various States. Answering the honorable senator’s question specifically, I believe that two Australian cruisers were engaged with the American forces during the Battle of the Coral Sea. The battle itself was fought entirely by naval aircraft off aircraft carriers. Surface ships did not at any time notice each other. I think that either the day before or the day after the battle there were one or two air attacks on the ships with which the two Australian cruisers were in association. The Australian cruisers were there as part of the supporting forces which took part in the battle. I had not heard previously of any complaints by Australian naval veterans that they had not been properly recognized in the arrangements made by the AustralianAmerican Association. Indeed, at all the Coral Sea functions that I have attended reference has been made specifically to the united part which Australians and Americans took in this action. At most of these functions, a representative of the Royal Australian Navy has been present. At the Coral Sea ball that was held in Canberra last year, the representative was an Australian admiral who had been on board one of the ships I have mentioned. Perhaps the learned judge who made these statements was allowing his emotions to run away with themselves to some extent when he talked about such things as studied insults.

page 1215

QUESTION

SHIPPING

Senator KENNELLY:
VICTORIA

asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. What tankers, if any, operate interstate services on the Australian coast on temporary permits?
  2. How many interstate trips were made by these vessels in the last six months?
  3. What wages were paid to crew members during this period and how do these wages compare with those paid to Australian crews?
Senator PALTRIDGE:
LP

– The Minister for Shipping and Transport has provided the following answers: -

  1. At present eleven overseas-owned tankers have continuing permits to operate on the Australian coast. Other tankers are granted single voyage permits as required, pursuant to the provisions of the Navigation Act.
  2. During the six months period ended 28th February, 1962, only four of the eleven tankers on continuing permit were used on the Australian coast and these made a total of 31 interstate voyages, while 128 single voyage permits were issued for interstate voyages by other tankers.
  3. Precise information is not available as to conditions of employment or the wages paid to crew members of overseas tankers which operate from time to time on the Australian coast and consequently comparisons of total emoluments of the respective crews are not possible. Of the 128 vessels referred to in question 2, more than half were registered in the United Kingdom. Based on the limited information available within my department, crew pay and employment conditions for vessels on United Kingdom register would be somewhat inferior to those fixed for Australian licensed vessels.

page 1216

QUESTION

TELEVISION

Senator BRANSON:

asked the Minister representing the Postmaster-General, upon notice - 1 Is it a fact that the quotes that have been called for by the Australian Broadcasting Commission for television translators are for very high frequency units for operation on channels 3 and 6 of the VH.F. band?

  1. Has the department considered the use of translators that receive on V.H.F. channels and transmit on ultra high frequency channels in order to avoid using up the valuable V.H.F. channels?
  2. What is the cost of the simple converter that is needed to receive U.H.F. transmission on a V.H.F. television receiver?
Senator WADE:
CP

– The PostmasterGeneral has supplied the following answers: -

  1. Quotations have been invited from known manufacturers of translator equipment for a television translator for reception on channel 3 and transmission on channel 6. Both these channels are in the very high frequency (V.H.F.) band.
  2. The use of translators that receive on V.H.F. channels and transmit on ultra high frequency (U.H.F.) channels has been considered by the Australian Broadcasting Control Board. However, the television service in the Commonwealth is at present being developed in the V.H.F. band and the use of translators which transmit on U.H.F. channels would make it necessary for a relatively small proportion of the Commonwealth population to purchase special receiving equipment as Australian television receivers will not receive U.H.F. transmissions without modification. Although the use of U.H.F. channels would avoid the use of valuable V.H.F. channels, it is considered desirable in the interests of viewers to continue development of the television services in the V.H.F. band. It is possible, of course, depending upon future development, that it will be necessary to use the U.H.F. band for television or other purposes at a later stage.
  3. It is estimated that the cost of converting a V.H.F. receiver to permit reception of U.H.F. transmissions would be approximately £25 if appreciable numbers of receivers were involved, but the cost of conversion would possibly be higher for only limited numbers of receivers. The cost of a U.H.F. aerial would be additional to the receiver costs.

page 1216

QUESTION

COMMONWEALTH AND STATE FINANCIAL RELATIONS

Senator CANT:
through Senator 0’Byrne

asked the Minister representing the Treasurer, upon notice -

  1. Does the Commonwealth Government advance moneys from Consolidated Revenue to the States?
  2. Do the States have to pay interest on this money? If so, how much was paid in interest by each State during each of the years 1950-51 to 1960-61?
  3. Have all the Slates paid the interest due during this period? If not, what is the amount outstanding and which of the States owe interest to the Commonwealth Government?
Senator PALTRIDGE:
LP

– The Treasurer has supplied the following answers: - 1. (a) Advances, which do not bear interest, may be made to the States from the Consolidated Revenue Fund under the authority of certain statutes, e.g. States Grants Act 1959. Such advances are adjusted by amounts that subsequently become payable to the States under those statutes.

  1. Other statutes, e.g. the Housing Agreement Act 1956 and the Coal Loading Works Agreement (New South Wales) Act 1961, provide for interest bearing advances to be made in accordance with the terms of a specific agreement between the Commonwealth and the State.
  2. Advances are also made to the Stales under certain administrative arrangements for the performance of services on behalf of the Commonwealth. No interest charges are involved and the advances are adjusted against subsequent claims for reimbursement of actual expenditure. 2 Interest payments by the States on advances made from the Consolidated Revenue Fund during the years 1950-51 to’ 1960-61 are as follows: -
  1. All interest charges have been met regularly by the States. No amount is outstanding. The honorable senator will be aware, of course, that other expenditures have been made by the Commonwealth from the Consolidated Revenue Fund, e.g. under the Railway Standardization (New

South Wales and Victoria) Agreement Act 1958, in respect of which the States concerned are liable to make interest payments. In addition, interest bearing payments, in the form of loans and advances, are made to the Slates from the Loan Fund, e.g. loans under the Financial Agreement Act 1944.

page 1217

QUESTION

ROAD SAFETY

Senator BRANSON:

asked the Minister representing the Minister for Shipping and Transport, upon notice -

  1. What action can the Government take to implement the recommendations of the report of the Senate Select Committee on Road Safety?
  2. Can the Minister make available the figures of the number of road deaths and injuries in each State during the period 1st May, 1961, to 1st May, 1962, showing the break-up of those figures into separate age groups, and indicating the causes of the accidents in each group?
Senator PALTRIDGE:
LP

– The Minister for Shipping and Transport has furnished the following replies: -

  1. Most of the recommendations are directly the concern of the State authorities. Only a limited number were the concern of the Commonwealth and, where appropriate, action has been taken to implement these recommendations.
  2. The latest available figures of road deaths and injuries compiled and issued by the Commonwealth Statistician are for the year ended 30th June, 1961. The Commonwealth Statistician’s return for this period shows the number of deaths and injuries in each State and the A.C.T. as follows: -

Returns classifying road accidents involving casualties in greater detail are available from the Commonwealth Statistician, but they do not relate primary causes of casualties to specific age groups.

page 1217

QUESTION

TELEPHONE DIRECTORIES

Senator WADE:
CP

– On 5th April, Senator Marriott asked me the following question: -

My question is directed to the Minister representing the Postmaster-General. It contains a suggestion which, if adopted, would probably be hailed by all telephone users throughout Australia. In view of the obvious fact that the PostmasterGeneral’s Department is continually trying to improve Australian telephone directories, will the Minister suggest to the Postmaster-General that in all future issues of directories the name of the city or area with which a directory is concerned shall be printed in bold letters on the spine of the directory so as to enable those organizations and companies which use many directories to place them on a shelf, as one does with books, and to select readily the directory that is required? At the present time all that is to be seen on a directory stored in a bookshelf is an advertisement of some sort. One has no idea of the area to which the telephone directory relates.

The Postmaster-General has now furnished me with the following information in reply: -

The only directories which do not have their titles printed on the spine are the Tasmania and Northern Territory publications and the sectional directories for New South Wales, Victoria and Queensland.

The Tasmania directory is produced with a special cloth binding which is in roll form. It would be possible to have the word “ Tasmania “ printed on cloth but, because of the way in which the cloth is fitted to the books, the word would have to be repeated continuously as is the case with names on adhesive tapes and guillotining would cut some of the words. This would detract from the appearance of the book. However, should a change be made in the method of binding, the title will be shown on the spine.

The space on the spine of each of the other books mentioned would not accommodate the full title which, in effect, is the list of districts at present shown on the front cover. If it were practicable to designate the directories with simple general titles, such as “ Northern Districts “, printing on the spine would not present as great a problem. Unfortunately, it is not possible to adopt one of the district titles as the title of the directory because of the number of districts covered by each directory and the fact that such a title would not be sufficiently descriptive.

However, the position will be kept under review to ensure that the books arc labelled on the spines when practicable.

page 1217

TEACHING COSTS OF MEDICAL HOSPITALS

Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP

– 1 lay on the table of the Senate the following paper: -

Report of the Committee on Teaching Costs of Medical Hospitals to the Australian Universities Commission, dated 6th October, 1961.

Senator ANDERSON:
New South Wales

– I move -

That the paper be printed.

I ask for leave to address myself to the motion at a later stage.

Leave granted; debate adjourned.

page 1218

SUGAR AGREEMENT BILL 1962

Debate resumed from 8th May (vide page 1209), on motion by Senator Wade -

That the bill be now read a second time.

Senator WRIGHT:
Tasmania

.- We are debating a bill which proposes to approve an agreement made between the Commonwealth and the State of Queensland renewing provisions which have now stood as part of the affairs of this country for some 40 years, stabilizing and protecting the sugar industry. I believe it to be a matter of some, interest to note that the mechanism by which this industry has been supported has been able to survive all legal obstacles, and to allow the establishment in the north of Australia of an industry of which I believe every Australian is very proud. The way in which it is done, I understand, is that the Commonwealth invokes its power over external trade and prohibit* the importation of sugar. Then, the Queensland Government, under its power of acquisition, acquires the Queensland sugar crop. Then, the Queensland Government, through its agency, the Sugar Board, makes arrangements for the processing of the sugar crop and the distribution of sugar for Australian requirements, one of the conditions being that the price has to be uniform in all State capitals. Finally, as the fourth feature of the scheme, the Sugar Board arranges for the sale overseas of the surplus sugar produced.

I believe that the Senate is interested in this legislation for the purpose of giving very strong approval to its continuance. Nowadays, we never stop to think of the political ideas underlying the scheme because, based on the four features mentioned, it has proved a remarkable success. In considering renewal of the agreement we are - I, for my part, am - concerned, first, for the Queensland sugar producer and all the other people associated with the production of sugar; secondly, for the consumers of Australia; and thirdly, and not unimportantly, for a cognate industry always recognized as having an allied interest in the provisions of this scheme, namely, the fruit industry. With regard to the Queensland producer, I find it satisfactory to remind myself that last year sugar production in Queensland totalled 1,300,000 tons, which represents an increase of something like 80 or 90 per cent, over the last decade. Looking at the distribution of our sugar production, I see that, according to the figures supplied to me, in 1961 the home consumption was some 585,000 tons - to the nearest 1,000 tons - whilst exports totalled 797,000 tons. Those figures give an idea of the important dimensions of this industry.

One of the matters that the recent committee of inquiry was concerned about was efficiency in the industry. It is most satisfactory to note that a committee presided over by Sir Mortimer McCarthy was good enough to say that there was no evidence of inefficiency in any phase of the industry. That is a very reassuring finding, but in our enthusiasm for the industry we should not neglect to take stock of one or two matters which I think were somewhat overemphasized in speeches made elsewhere. Great claims have been made relating to improved yields of cane and of sugar, as though miracles had been wrought in that respect. I shall quote the Queensland figures, which have been given to me. It is true that the yield of cane per acre was 18.3 tons in 1951, and that from 1952 onwards it ranged up to 24.9 tons per acre. Last year it was 24.24 tons having risen in the meantime to as high as 28.12 tons. I think such progress is unspectacular but satisfactory. When I examine the quantity of cane required to produce a ton of sugar, I find no basis for claims - in my opinion, over-stated claims - in another place to the effect that spectacular improvements have been made year by year. Quoting Queensland again, the quantity was 7.11 tons in 1951 and 6.86 tons in 1961. That, too, is satisfactory but unspectacular.

Senator Sir Neil O’sullivan:

– Seasonal conditions have an effect.

Senator WRIGHT:

– I agree that that is so. I am speaking in these terms to make it quite clear that I have an earnest appreciation of the work of those people who have striven to make every one in the industry - growers, millers and others - prosperous, lt is gratifying that the prosperity that this scheme has secured for the industry has not been abused by a drift into inefficiency. Every Australian is proud of the progress made by this industry, and it is re-assuring to find, on the part of those who are employed in its various stages, such a degree of satisfaction with the results of the scheme.

Turning to a consideration of the interests of the consumer, I agree that, as the Minister said when introducing the bill, in creating a protective mechanism for an industry, as the present agreement does, there is an inclination to assume that something is being done which will permanently inflate the home consumption price of the commodity concerned. We are all aware that the present price of sugar to the consumer is Hd. a lb. As I understand tha agreement that we are being asked’ to ratify, it provides for a price of £90 5s. 2d. per ton for refined sugar of 1A grade. The corresponding price in the 1956 agreement WaS about f SO a ton. So that other matters that 1 will mention later in my address will appear in focus, I point out now that in 1930 - I speak from memory - the price was about £30 a ton. ] am referring to home consumption prices - to the prices paid by Australian consumers for sugar grown under the scheme. Therefore, the trend of the price of sugar does not diverge greatly from the trend of other prices in the Australian economy.

We have had to establish a sugar-growing industry in the tropics, with European labour, and to forgo at some stages the advantage of importing sugar from abroad. It is undoubted that the Australian consumer has contributed substantially to the expansion of the industry by paying a price that has enabled this to occur. However, having regard to the fact that the trend of the price of sugar does not diverge far from the ordinary trend of prices within the Commonwealth, I would suggest that there is no complaint on behalf of the Australian consumers at the proposal to retain the retail price of lid. per lb., despite the fact that the McCarthy committee recommended an adjustment that would have enabled a retail price of 10id. per lb. to be charged”. Having read only that part of the report that has been made available to us - the summary and the recommendations - and therefore being unassisted by the full reasoning of the committee in support of its proposition, I do not find the reasons for this recommendation to be convincing. I for one am glad, that the Government saw fit to reject that proposal.

It is only fair to say that the McCarthy committee made the recommendation on the basis that the conditions that were current when it made its report remained without substantial alteration. Important international events, which have made a special impact on the sugar industry, have occurred since the McCarthy committee report was penned in August, 1961. I refer, of course, to the dislocation in international trade caused by the developments in Cuba and to the increasing significance to the sugar industry of the negotiations which are now proceeding in Europe relating to the entry of Great Britain into the European Common Market. I agree wholeheartedly with the decision of the Government, having regard to the circumstances which surround the sugar industry, and particularly to the two factors I have mentioned.

The international price was, I understand, about £19 a ton in December last. Although the price is about £24 a ton to-day, I think the Government showed that it recognized the dangers confronting the industry by declining to reduce the return to the grower. It is better to maintain the price to the consumer at Hd. per lb., so that the industry will have a margin of protection against the dangers that confront it. I have made those observations, Mr. Acting Deputy President, because I believe we should have regard in all these matters to the interests of the consumer. By and large, the consumer has protective devices which he may use. If he is a wage-earner, his wages are adjusted periodically for his benefit.

I come now to an aspect of the Sugar Agreement which, I regret to say, the Senate has failed properly to understand. I refer to the interrelationship between the sugar industry and the fruit industry. We have made some progress in this connexion, because a proposition which hitherto has been unanimously rejected in this chamber has now been given the status to which it is entitled by being included in the Minister’s second-reading speech. The Minister stated -

The agreement provides that the State of Queensland shall, on behalf of the sugar industry, continue to contribute £264,000 annually to the Fruit Industry Sugar Concession Committee for the payment of domestic rebate. Only in a technical sense is this paid by the sugar industry, because it is included in that industry’s cost structure and, in the final analysis, it will be paid by the consumers of sugar in the domestic price. This is also the position in the case of the export rebates.

I have spoken in warm approval of the efforts that have been made to maintain prosperity in the sugar industry, particularly the grower section of the industry, but we are quite mistaken if we say, when we come to consider the interests of the related fruit industry, that the fruit industry is begging for assistance from the returns to the sugar growers. It is doing nothing of the sort. Wise people, people of tremendous political courage and foresight, of whom the late Right Honorable Sir Earle Page was in the vanguard, really understand the position. It was typical of Sir Earle Page’s deep understanding of Australian industries that he refused to take an isolated view. He saw that if we were to create a protective mechanism for the sugar industry, it was obvious that we would have to consider the impact that that arrangement would make on the interrelated fruit industry. So, the very first agreement provided that exported fruit products, in the processing of which sugar had been used, would be at no disadvantage in our external markets because an artificial price for sugar had been created in this country as a means of protecting the expanding sugar industry.

A guarantee was given that the differential between the Australian price for sugar and the price at which sugar could be imported duty-free, would be reimbursed, not out of the pockets of the sugar producers, but out of the general proceeds of this scheme which derived from an Australiawide arrangement that the Australian consumer would pay a fixed price for sugar. One of the items of cost covered by the scheme is the additional cost that the exporter of processed fruit has to incur by having to pay the Australian price for sugar, a price that is higher than the price for which imported sugar would be available if this scheme did not exist. That was a far-seeing arrangement. The people who wrote it into the scheme deserve great credit.

It is most unfortunate that other exporting primary industries, which suffer by reason of protective mechanisms, are not subject to parallel provisions in the form of export subsidies, in order to preserve parity of prosperity between the exporting primary industries and the artificial manufacturing or secondary industries. I mention that matter as a passing observation. The scheme is not a difficult one to administer. It is a sensible one, and evidence of that fact is to be seen in the history of the export sugar rebate as it has applied to the sugar and fruit industries for 40 years. Secondly, there was written into the scheme a provision that the user of processed fruit consumed on the Australian market should receive assistance under the scheme in the form of a domestic sugar rebate. I know that that term has been criticized from time to time, but I have the authority of the McCarthy committee to adopt the description. One is an export sugar rebate and the other is a domestic sugar rebate. A lot of confusion has arisen with regard to the nature and purpose of the rebate. In the report of the 1931 committee of inquiry I find a discussion of the extent to which the fruit industry should receive recognition as part and parcel of this scheme. In the 1920’s, the fruit industry was suffering from poverty. Its position was comparable to the position it is iri to-day. Arguments were put forward that the sugar scheme was not designed to render assistance to the fruit industry because of the low state of that industry. Paragraph 273 of that report reads -

Much the same position applies to berry fruits in Victoria and Tasmania. The latter State produces five-sixths of the berry fruits grown in Australia. According to evidence, about 2,000 tons of the 1930 yield of 6,000 tons could not be sold and was thus wasted. The position for 1931 is that 1,500 tons are expected to be wasted.

That information is similar to the information with regard to other canning fruits to which particular reference is made. After discussing the arguments the committee, in paragraph 283 of its report, stated -

However, despite these facts regarding the general trade depression, fruit over-production, and the small increase in the cost of the sugar contents compared with other increased costs, we are of the opinion that the soft fruits industry is specially affected by the sugar position in other directions, and can be most readily helped by an extension of the present sugar concession . . .

The first recommendation made by the committee under this head appears in paragraph 298, which reads -

We therefore recommend -

that the sugar industry be required in future to contribute £315,000 per annum (instead of the present home consumption and export rebates amounting to about £205,000 per annum) for the assistance of the fruit industry;

that this sum shall be contingent upon the present ordinary manufacturing price of sugar, viz. £3611s. 9d. per ton, being maintained; the total contribution of £315,000 per annum to be reduced to an extent equivalent to any reduction that may be made in the present ordinary manufacturing price of sugar; any such reduction to be applied to the home consumption rebate of £6 5s.1d. per ton.

That report established that at that time the domestic sugar rebate should be £6 5s.1d. a ton, and that it should fluctuate according to the known price of sugar. In the depression that became acute within two years it was found necessary to reduce the rebate to £2 4s. a ton. Due to a contrariety of circumstances, that figure was maintained until about 1959, when Mr. McEwen announced that it would be increased to £5 a ton.It is unfortunate that the McCarthy committee, having examined this matter, found itself committed to report that the domestic sugar rebate was not fulfilling the purpose for which it was designed. The committee reported that the rebate should be gradually reduced and eventually eliminated. I am very glad to know that in answer to an inquiry made by the honorable member for Franklin, Mr. Falkinder, the Minister said that not only was that proposal rejected at the present time, but that the Government undertook not to reduce below £5 a ton the domestic sugar rebate during the currency of this agreement. The fact that the McCarthy report recommends a restriction of the sugar rebate indicates that the committee completely misunderstood the relationship of the rebate to the fruit industry. We now have the Minister’s definite statement that the rebate comes not from the pockets of the sugar producer, but from the general proceeds of the price paid for sugar by consumers throughout Australia. We have established a distinct relationship between the sugar industry and the fruit industry from the time this scheme was resuscitated in 1931. The amount of the domestic sugar rebate should vary according to the price of sugar. As the price of sugar was £36 a ton in 1931 and as it is now, under the agreement, £90 a ton, the multiplier of £6 should be something of the order of two and a half, and the domestic price rebate should be £13 or £15 a ton instead of £5 a ton. Then the fruit producer would have some guarantee of an economic return because of the fixing of a minimum price at which his product would be bought by the fruit processor, provided that an economic price was paid. Only in those circumstances would the fruit processor enjoy the benefit of the domestic sugar rebate. In that respect we must go one step further before this scheme is placed on a proper footing. In the committee stage I hope to have an opportunity to move the appropriate amendment to give effect to my suggestion.

Senator DITTMER:
Queensland

– It may be trite to say that necessity is the mother of invention, but it may not be so trite to say that necessity is the mother of ingenuity. When we think in terms of political necessity we realize just what ideas may be brought forth. It is interesting to note that the McCarthy report was published on 31st August, 1961. That report recommended a reduction in the price of sugar. The report also represented an attack on the fruit industry. On 22nd January, 1962, the Government announced that it would not accept the recommendations of the committee in regard to the price of sugar. In the interim we had had the election on 9th December. In the two States concerned - Queensland and Tasmania - the Government had not done particularly well. In fact, it had done very badly. In Queensland, it lost eight seats and in Tasmania it made a very poor showing. So the circumstances to which I have referred suggested that political necessity determined the Government’s decision not to accept all of the recommendations of the McCarthy committee. I am not of a suspicious nature, but one might suspect sometimes that the committee was set up with a view to determining - I want to make it quite clear I am not reflecting on the members of that committee - to recommend a reduction in the price of sugar if any justification could be found for such a reduction. The Government has a slender majority in the other place, and realizing that it may have to face the people at any time, it has not wished to antagonize the electors of Queensland and Tasmania. As a result the industry is to receive a measure of protection. lt is interesting to recall- and I think my memory serves me all right - that the only government that reduced the price of sugar - some may claim that the reduction was the result of a voluntary decision, but I happen to know real compulsion was brought to bear - was the Lyons Government. H reduced the price by a halfpenny per lb.

We should think of the part the sugar industry has played in the settlement of the coastal lands of Queensland, and also the part it played in the preservation of Australia during the last war. It is quite possible that if the coastal lands of Queensland had not been settled the Japs might have struck there. I am pleased on this occasion that both Government and Opposition members have seen fit to speak in high praise of this industry. At times attacks have been made on the sugar industry and the high price paid for sugar in Australia, but those who have made these attacks have forgotten that from time to time the price of sugar to the consumers in Australia has been much lower than the world price. It may be said that this industry operates under a large measure of nationalization or national control in this industry. In 1915 the Labour Government led by the late T. J. Ryan passed the Sugar Acquisition Act which acquired all the sugar produced in Queensland. In the same year the Hughes Labour Government passed the Sugar Purchase Act under which it acquired all the sugar of Queensland and New South Wales.

Senator HENTY:
TASMANIA · LP

– What year was that?

Senator DITTMER:

– It was 1915. The price of sugar was then over £14 a ton and was subsequently lifted to £18 a ton. The latter price was continued for a number of years. In 1917, I think, the Dickson award granted a substantial increase in wages to workers, but the growers did not receive any increase in price. For a period the price to the growers was £18 a ton. At the same time sugar was brought into Australia at a cost ranging from £45 to as high as £90 a ton. That was one time when sugar was sold at a low price to the Australian consumer.

During the last war and the years that followed it, Australians were purchasing the cheapest sugar in the world. Do not think that this Sugar Agreement is, as it were, a one-way traffic agreement. The sugar industry has made its contribution to the economy and development of this country. The sugar people are grateful for the consideration that has been extended to them by various governments, and I would be ungracious if I did not pay a tribute to the late Sir Earle Page for the sugar agreement that was implemented in 1923 between the Labour Government of Queensland and the Bruce-Page Government. In fact, that agreement is the basis of, and runs parallel with, the agreement that is being discussed by this chamber. The agreement has stood the test of time and has served the interests of the industry and the nation well.

The sugar industry is a particularly well organized industry. It looks after its product from the. soil to the end result, including the refining of the sugar and the selling of the raw product overseas. The Australian industry compares favorably with that of any other country in the world in respect of cultivation, milling and refining. We sometimes hear from southerners criticism of the industry but it must be realized that not all of the £65,000,000 associated with the industry last year has gone to Queensland or northern New South Wales. Not all of that money goes to the cane cutters, the growers and the millers. A large amount of it is spent in the southern States. A large amount of refining is done in the south, and machinery such as tractors or harvesters are bought in the south. Mill spare parts are also manufactured in the south.

Senator Courtice:

– And export earnings go to the south.

Senator DITTMER:

– As Senator Courtice has said, in many cases export earnings go to the south. Last year the sugar industry earned £30,000,000 overseas.

Despite the arduous nature of the industry there has been a minimum of industrial turmoil. The men engaged in the industry - both farmers and canecutters - have, by and large, shown goodwill one towards the other. Disputes have occurred and strikes have taken place, but in view of the arduous nature of the industry, and the climatic conditions associated with it, there has been a minimum of industrial turmoil.

Let us think how this industry is controlled. The first cane was grown in New South Wales at Port Macquarie about 1823 or 1824 - more than 100 years ago. Because of the unsuitable climate the industry moved further north in New South Wales, and approximately a century ago the first cane was grown in Queensland. In the early days labour conditions were bad and the industry was associated with some of the most unpleasant incidents in the history of Australia. Sir Samuel Griffith realized that, given a measure of assistance, the industry could become a white man’s industry. Since then every government, irrespective of its political colour, has endeavoured to preserve the sugar industry as a white man’s industry and to ensure that those associated with it received a reasonable return. As a result of legislation enacted by successive Queensland Labour governments the industry has experienced the utmost harmony and a great measure of prosperity.

In Queensland, the Sugar Board acquires at a pre-determined tonnage price all the sugar that is produced. Because of the possibility of territorial conflict or conflict over sovereignty the term “ purchase “ is used. The sugar grown in New South Wales amounted last year, I think, to about 550,000 tons of cane from which was extracted a little more than 70,000 tons of sugar. The handling of the whole crop is in the hands of the Sugar Board. For the purpose of determining conditions of production and settling disputes in any section of the industry the Central Sugar Cane Prices Board has been established. The chairman is a Supreme Court judge and the members are a representative of the growers, a representative of the millers, an accountant and a chemist, the latter two not having a vote. It shows that where there is a sincere desire on the part of a government to assist an industry, and where there is a sensible appreciation by those concerned of the problems of that industry, there can be within the industry not only harmony but efficiency and associated prosperity. That state of affairs has continued through the years in the sugar industry.

The future of the industry in the export field is assured, one might say, until 1969, because of the agreement with the United Kingdom Government, and the industry is protected internally because of the agreement under discussion, which is effective from 1st September of last year until 31st August, 1967. This agreement protects the growers, in that it provides for a determined price for home consumption sugar. The quantity of sugar involved is 560,000 tons, which is not even one-half of the annual production. I think last years production was just over 1,300,000 tons. This year, the Sugar Board, because of satisfactory arrangements made with overseas countries, has determined that the production quota shall be 1,500,000 tons. The basic peak, determined on the farm tonnage basis of cane, is just over 1,200,000 tons. Through the activities of representatives of the Sugar Board, arrangements have been made to sell to the United Kingdom, at a negotiated price of £45 15s. 3d. a ton, approximately 340,000 tons of sugar. Another 100,000 tons will go to Canada, 245,000 tons to Japan, 80,000 tons to New Zealand, 10,000 tons to South Korea and 50,000 tons to Hong Kong. If there is a surplus after those deliveries, possibly the board will be able to get rid of it. However, the contracts already entered into rive the industry an assurance of large sales in addition to sales for home consumption.

When you consider this industry, you realize, not only that it is of extreme value as an export earner, but also that it shows to the world that Australia is making a definite endeavour to settle people in the tropical areas of its north under reasonably satisfactory conditions. However, even apart from those factors, the industry deserves a measure of consideration. As far back da 1924, it was realized that if this industry was to survive in a highly competitive field, definite action would need to be taken. Sugar production is highly competitive, because it is undertaken by many low-wage countries. The United States of America uses more than 6,000,000 tons of sugar a year. Approximately 2,000,000 tons of that sugar is beet sugar produced in the United States, but more than 1,000,000 tons is imported from Hawaii, about 980,000 tons from Puerto Rico, 700,000 tons from the Philippines, and smaller quantities from the Dominican Republic and other countries. The Australian industry also has to compete with sugar producers in Mauritius and with other low-cost producers. The Queensland Labour Government in 1924 realized that it had a real responsibility in this matter, so it selected three comparatively young university graduates to go overseas to investigate the sugar industry. One was a soil expert, one was on the engineering side and one was on the refining side. All these men distinguished themselves. Their names were Bell, Bennett and Kerr. Their work was outstandingly successful and made a real contribution to the efficiency of the Australian sugar industry. The development of the industry in Queensland has been due in no small measure to their efforts, ability and vision.

Through the years, there has been a great increase of sugar production in Queensland. Better varieties of cane were introduced, and those varieties were improved still further. The growers learned how to use fertilizers. Recently legislation was introduced into this Parliament which authorized the payment of a Commonwealth subsidy on sulphate of ammonia at the rate of £2 a ton, I think. That will be a real help to the sugar cane producers, as well as to other farmers. A large proportion of the 100,000 tons of sulphate of ammonia which is produced in Australia annually is utilized in the sugar cane industry. The rate of extraction in Australian sugar mills is as good* as anywhere else in the world, and the products compare favorably with those of mills in other countries.

Unfortunately, however, improvements in efficiency have led to troubles. It was formerly the practice to bag the sugar cane in the fields and stack the bags, and then to load them on to trucks and then on to ships. All that was done by hand. How ever, in recent years bulk handling of sugar has been introduced, and this has deprived thousands of men of work. When bulk handling was introduced in the port of Mackay, 400 men of a total of 450 had their services terminated. This type of thing is happening in Townsville, Bundaberg, Lucinda and practically every Queensland sugar port except Cairns.

Senator Wright:

– What is the point you make?

Senator DITTMER:

– I am speaking of men who have lost their means of livelihood. I do not deny that there is justification for increased mechanization, but I say that we should think also of the men who spent most of their lives in the industry and were dismissed. I do not want to digress too much, but I point out that they have not been provided” for suitably through rehabilitation courses. They are a drug on the employment market to-day.

Senator Ormonde:

– These are oneindustry towns.

Senator DITTMER:

– Yes, there is no other source of employment there. Previously, off-seasonal work could be provided by the local government authorities, thus taking up some unemployment, but that cannot be done now, as the supply of money to such authorities has been restricted. The position is the same in Childers, Bundaberg, Mackay, Proserpine, Ayr, Home Hill, Ingham, Gordonvale and Babinda. One might say they are all oneindustry towns, depending almost entirely on sugar production. When men lose their occupations in this industry, there is practically no other avenue of employment available to them. Many of these men are in their forties and fifties; they have their homes in these towns, and their children are either being educated there or are working there. In the circumstances, these men do not know what to do.

The eyes of the world are on Australia. We must settle these areas properly if we are to be justified in holding them. At present, men are unemployed on the waterfront and in the cane-fields. The year before last, just over 2 per cent, of the cane was harvested mechanically, but last year over 5 per cent, was harvested in that way. The percentage is increasing as new types of harvesters are introduced. Years ago, all cane, after being hand-cut, was loaded by hand. To-day, more than 50 per cent, is loaded mechanically. As the harvesters are improved, fewer cane cutters are employed. Last year, in the area from Mossman to Townsville 700 fewer cutters were employed, because of the use of mechanical harvesters. Incidentally, most of these machines come from the south. Some are made in Mackay and a few in Bundaberg, but the majority are Massey-Ferguson products from the southern States. If there is to be a continual substantial decrease in employment in the sugar industry in these districts, the only way to retain the present population will be to provide other avenues of work. This is becoming quite a real problem. The values of . properties, not so much of cane farms, are decreasing.

We must look to the future. The agreement we are discussing was brought about, I believe, by political necessity or fear of the wrath of the electors, but I pay the Government the tribute of saying that it will protect the sugar-growing industry until 1967 in relation to sugar consumed in Australia. Irrespective of whether the United Kingdom joins the European Common Market, the sugar industry is protected until 1969 in respect of the sale of its product to that country. But what does the future hold if, as appears probable - some people say it is certain - the United Kingdom joins the Common Market? Not one ton of sugar will be sold to that country.

It is of no use to talk about how the Treaty of Rome can be modified. It is specific, and it would not be the Treaty of Rome if it was altered. Senator Wright could guide me on this matter. I take it that if an alteration is made to the treaty it is no longer the Treaty of Rome. There has to be a specific agreement between the contracting parties.

The beet sugar industry in European countries is expanding. As recently as a couple of months ago, Greece - an associate member of the European Economic Community - embarked on a rather elaborate expansion of beet sugar cultivation. We will need not only to be able to sell sugar at a price more than the cost of production. Under the tariff regulations provided specifically in the Treaty of Rome a tariff of 80 per cent, is to be imposed on sugar from any country other than the constituent members of the Common Market. When we consider those matters, apart from the fact that Australia is a relatively high-wage country, we realize that we would not sell an ounce of sugar to the Common Market countries. An endeavour will be made to exclude sugar from other countries; that fs specifically provided for. The aim of the Common Market countries is to protect their own beet sugar industries and their own growers. That is why I say that the Australian sugar industry must view the future with a measure of real concern.

The Australian sugar-growers and all the other people engaged in this industry, to which they owe their livelihood, are grateful for the security expressed in this agreement; but irrespective of what any one else may say, I say that the industry must view the future with trepidation. I hope that the United Kingdom will realize its responsibilities to other Commonwealth countries. We are not in a position to make its decision; but in the light of past associations I hope that the United Kingdom, in seeking to enter the Common Market, will seriously consider the effects of its decision, particularly from the point of view of primary production in Australia, including the industry covered by this agreement.

Senator WOOD:
Queensland

.- Mr. President, I am very pleased that the renewal of the Sugar Agreement is so warmly applauded on both sides of the Senate. That indicates that over a period of years quite a change of mind has taken place on the protection of this very valuable industry. I believe that most thinking people to-day recognize its importance in its various phases. Whilst there may be some slight differences of opinion about the agreement, as has been pointed out by Senator Wright, generally the opinion of honorable senators is that the industry deserves the renewal of this agreement.

Those of us who come from Queensland, the State in which the bulk of Australia’s sugar is produced - portion of it is produced in the northern part of New South Wales - are pleased that the change of attitude has taken place. Some years ago there was quite an agitation about the price of sugar. It is interesting to note that whenever the sugar industry presents an application for an increase in price it is very conscious of the need to ensure that the price is a reasonable one’ based on the cost ot production plus a fair return to the growers and other people engaged in the industry. The people in the industry realize, as do many other people to-day, that if the price of their product is too high buyer-resistance will be encountered and their sales will suffer.

Over, the years governments of different political colours have accepted the fact that the industry, in presenting its case for an increase in price, has generally asked for a fair and reasonable price. To the credit of this Government, throughout the years thai it has been in office it has set an example that the people in the industry and the sugar consumers must be fairly treated. The Prime Minister (Mr. Menzies), in his various statements, has shown that in his view a situation has been reached in which governments will always recognize that the sugar industry is deserving of the consideration that it has received and is receiving from the various governments that have occupied the government benches in this National Parliament.

The importance of this industry has been mentioned by various speakers. Those of us who live in the sugar-producing regions know how valuable it is. It has been responsible for the development and closer settlement of most of the Queensland coast, particularly in the tropical area of that State. If people who have not visited the sugar-producing areas were to go through them, they would realize what a vacuum would be caused if the sugar industry in Queensland went out of existence. They would also realize how much Queensland would be set back and that the manufacturing industries in the southern part of Australia would lose business because of the repercussions.

We cannot help being proud of the development of this industry in areas that at one time were considered to be unsuitable for white population. The sugar industry has proved conclusively that white people can work successfully and develop an industry in the tropics. In that respect the Queensland sugar industry has been very successful and has given the people of the world an example of which Australians generally should be very proud. The people in the sugar industry not only have developed their industry, carried it on and made it successful but also have built up fine cities and towns along the coast, ‘to which previous speakers have referred. These people, as members of the white race, have also set a splendid example in regions where at one time it was thought they could not succeed.

The sugar industry, in the early days, was a black man’s industry. Kanakas - people from the South Sea Islands - did most of the labouring work in the industry. Something that is forgotten sometimes is that one of the stumbling blocks to Queensland coming into the federation was the black labour used in the sugar industry. At that time one consideration was that if Queensland had to forgo the cheap black labour in its sugar industry under federation, that industry would receive protection. We must not forget that. That was a very forward step for us as a white race and the development of the sugar industry in Australia.

I am very glad that this bill has been introduced and is receiving support from both sides. The city in which I live has been mentioned by speakers in this debate on a number of occasions. I am very conscious of that because the Mackay district produces a very great proportion of Australia’s sugar. The sugar industry is the lifeblood of the City of Mackay, just as it is of many other cities and towns along the Queensland coast. I have mentioned the great importance of the industry to those areas.

As a resident of a sugar-producing area, I am particularly pleased to read some of the passages in the report of the Sugar Inquiry Committee, particularly in relation to efficiency, about which Senator Wright spoke. May I compliment him on the very generous measure of praise that he, as a Tasmanian and a representative of a colder region where sugar cane is not grown, has given to the industry. Whilst we might differ on matters such as rebates, I believe that his speech was a very generous contribution to the commendation of the sugar industry in Queensland and northern New South Wales.

The members of the committee that investigated the industry paid it a very fine compliment when they said that the industry was efficient in every section. That is a very high compliment, because often an industry is efficient overall, but it is not efficient in certain sections. This committee went into the industry very efficiently, as all other inquiries have done. The committee said that the industry not only is efficient in all departments but also is striving continually for greater efficiency. This striving for efficiency has had important effects within the industry and, generally, in the areas in which it operates. Because of improved milling techniques, the sugar crushing season is shortening in some areas, which is creating problems of employment. No doubt, there will also be other problems. Better types of sugar cane, which have been developed by the sugar experimental stations, have resulted in increased production.

Senator Wright mentioned the relationship of tonnage of cane to sugar produced. Whilst his figures may not appear to bc impressive to some one who is not familiar with the industry, they are impressive to those persons who understand the position. The annual report of the Queensland Cane Growers Council for the year 1961 stated that in 1950 7.6 tons of cane were needed to produce a ton of sugar, whereas in 1960 only 6.58 tons were required for this purpose. That was a reduction of just over one ton of cane in the production of one ton of sugar. That is a very fine performance in efficiency. I remember that when I was a lad in Mackay 9 tons of cane were needed to make one ton of sugar, and I have heard of instances in which 11 tons were required. So over the years the continual striving for efficiency has placed the industry on a very satisfactory basis.

Efficiency in sugar manufacturing comes about in many ways. The experimental stations produce new varieties of cane, with better yields and a higher percentage of sweetness. They have also done valuable work in helping to combat diseases. Better milling techniques have made a valuable contribution. With Mackay as a focal point, sugar research stations have played an important part in increasing mill efficiency. As time goes on, even better results will be achieved, but we must remember that after a certain stage of efficiency is reached, improvements may not be as great as they were when the efficiency of the industry was at a low standard. It is generally held that the Australian sugar industry is one of the most efficient sugar industries in the world. This is particularly significant because the industry functions with white labour in competition with cheap labour industries in most other countries. That is an achievement of which we ought to be proud.

Considerable improvements in efficiency have been attained on the shipping side. A few years ago, sugar was brought in bags, very often by rail, to the wharfs, unloaded, loaded on to the boats, to be unloaded finally in the south. But in the last five years about £10,000,000 has been expended on establishing bulk sugar terminals. No longer, except in the port of Cairns, do we ship sugar in bags. It is shipped’ in bulk, like wheat and some other products. The increase in efficiency has been remarkable. In Mackay, where the first bulk sugar terminal was established - then the best of its kind in the world - the loading of sugar, which used to take three weeks when the sugar was in sacks, now takes one day. That was a remarkable change Had it not been for these steps that the industry has taken towards greater efficiency, on which it has spent a large amount of money, application would have been made long before it was in fact made for an increase in the price of sugar. Increased efficiency in the industry has been of real benefit to the consuming public.

Senator Hannaford:

– Did the sugar industry itself put in the bulk terminals?

Senator WOOD:

– It contributed towards them.

Senator Hannaford:

– It did not pay all the cost.

Senator WOOD:

– The arrangements were made with the sugar industry. The harbour boards did certain sections of the work. The sugar industry instituted a £10,000,000 programme. I am very pleased that the Government did not accept the committee’s recommendation for a id. decrease in the price of sugar, subject to circumstances remaining the same. The committee did point out that clouds were on the horizon, and that if these became nearer or darker the committee’s views would be affected. I believe that the Government did right in the circumstances in not accepting the recommendation.

Senator Wright referred to the situation in Cuba. The International Sugar Agreement was entered into by all sugar-growing countries in order to stabilize the world price of sugar, but it was wrecked as a result of the activities of Cuba, which has come under Communist domination, and is receiving consideration in Russia’s purchase of Cuban sugar. This has had an effect on the world price of sugar. The Government of Cuba is quite unpredictable, and it could wreck the world’s sugar industry if it really let its head go.

The Australian industry produces the sugar consumed in Australia, plus an overproduction which is sold overseas. Therefore, in the local consumption price we must achieve a balance that will ensure that the industry is not wrecked internally by something that happens overseas. That part of Australia’s production which is for consumption overseas is important to this country. We know of the problems that arise in relation to overseas credits and balances. As Senator Dittmer said, the sugar industry earns over £30,000,000 of these credits for Australia. That is very important to a country urgently in need of overseas credits. It is essential, therefore, for us to keep the industry producing for overseas markets. The industry’s production has a total annual value of over £65,000,000, and to-day it is Queensland’s No. 1 primary industry. As well as being of great importance to Queensland, it is also vastly important to Australia generally, not only because of the employment that it provides, but also because of the money it brings in.

The rebate is an important matter, which was brought forward by Senator Wright. He is a very earnest representative of Tasmania, and he is to be commended upon the light that he always puts up for his own State. This is the States’ House, and it is gratifying that honorable senators have been prepared to stand up for what they think is right for their own States.

The rebate has been a contentious matter for years. I differ from Senator Wright in this regard. The committee recommended that the rebate allowed to the fruit-canning industry should be reduced and ultimately abolished. The Government did not accept the recommendation, but circumstances now are such that it may deserve further con sideration. I have held the view for many years that it is not right to tie one industry to another. The fruit-canning industry in Tasmania and in other States deserves more help in some ways, but I think it is unfair, not only to the sugar industry but also to the fruit-canning industry, to tie those two industries together through this rebate system. In his second-reading speech, the Minister pointed out that the sugar industry does not, as it were, pay the cost of the rebate to the fruit-canning industry from its own pocket. Senator Wright also made that clear. Let us accept that. Therefore, whatever is given by way of rebate will, if it is tacked on to the sugar industry, result in an increased price for sugar. There is no question about that. The cost of the rebate will have to be loaded on to the price of sugar.

Senator Scott:

– Who pays it?

Senator WOOD:

– The public pays it. If the fruit-canning industry requires more assistance, why should that assistance be given by further increasing the price of sugar? Why increase the price of sugar in order to assist the fruit-canning industry? There are other ways of providing assistance. In some industries, subsidies are given. I agree that the fruit-canning industry is important. It does not matter whether it is larger or smaller than the sugar industry; it is important to the people who are engaged In it. It is deserving of individual treatment. If the industry requires a subsidy to continue in existence, that is worthy of earnest consideration by the Government, but the industry should be treated separately. I agree that it should be given its just reward, because of the valuable part it plays in keeping people on the land and in providing employment, but difficulty will always arise if, in order to give an industry its just reward, the price of the product of another industry is raised. If the price of sugar were increased, buyer resistance to sugar might be created. We all know that such things can happen. The present system is not fair to the sugar industry, and I believe that, because of the tie-up of the two industries, the fruit-canning industry is not receiving proper consideration.

I think the committee’s recommendation is worthy of consideration. If the fruitcanning industry is put on a proper basis. both industries will go forward without either feeling that it is affecting the other. The fruit-canning industry should receive necessary support and the sugar industry should continue to be protected by a fixed price. Certain factors have affected the overseas price of sugar. If you cause the industry to collapse in Australia, and so affect overseas earnings, you bring on yourself other troubles within Australia.

Senator Scott:

– Has the price come down recently?

Senator WOOD:

– -The overseas price has come down recently because of the Cuban situation. As far as the price of sugar is concerned, let me remind the House that it is fixed within Australia on the basis that sugar must always be available to the people of Australia at that price.

Senator Scott:

– They would want it to be available, would they not?

Senator WOOD:

– Yes. There have been periods in the history of the sugar agreement when the industry could have obtained prices much higher than the fixed price, but it was compelled to supply sugar to the people of Australia at the fixed price. Perhaps sugar from overseas could be landed in Australia to-day at prices lower than those charged for Australian sugar, but at other periods it could not be landed at lower prices, so over a period the advantages and disadvantages arising from the agreement cancel each other out.

Now let me deal with another aspect of the rebate, relating to overseas sales of canned Australian fruit. Sugar is supplied to the fruit-canning industry on the basis that would apply if cheaper sugar could be obtained from overseas. In other words, the fruit-canning industry gets its sugar in Australia at the price it would have to pay for the cheapest sugar obtainable from overseas.

Senator Hannaford:

– Overseas parity plus freight.

Senator WOOD:

– Yes. That means that the fruit-canning industry is at no disadvantage in selling its products overseas. I think such treatment is very fair, and I do not think any one could cavil at it.

Senator Hannaford:

– Is not the sugar industry subsidizing the fruit-canning export industry - the very thing you have been arguing against?

Senator WOOD:

– The sugar industry is making a concession. I think the two industries should be separated as far as the consumption of sugar in Australia is concerned.

Many people, including some members of the Senate, think the sugar industry is being subsidized because there is a fixed price for sugar. In my opinion, the fixation of the price of sugar is no different from the protection of secondary industries by tariffs.

Senator Scott:

– But it is a form of subsidy, is it not?

Senator WOOD:

– It is no more a subsidy than is tariff protection. Every one accepts without question that our secondary industries should be protected, because of the employment that they provide. I am very pleased that to-day the protection of the sugar industry, through a fixed price, is being accepted so generously by the majority of the people in Australia.

This industry is of great importance, not only to Queensland, but also to Australia. It is important to Queensland because of the employment it provides for people in the southern part of the State and, incidentally, in the northern part of New South Wales. It is important also because of the employment it gives to many thousands of people in Brisbane, Sydney, Melbourne, Adelaide and Perth, in refineries and associated undertakings. That employment is available because raw sugar is produced in Queensland. The industry is important to Australia, further, because the purchasing power of the many thousands of people employed in it creates an added demand for the products of the secondary industries of the southern States. In the main, Queensland is not an industrial State. Its requirements for manufactured goods are met by New South Wales, Victoria and South Australia and probably, to a smaller degree, by Tasmania.

Senator Hannaford:

– We acknowledge all that.

Senator WOOD:

– I am explaining the great importance of the Queensland sugar industry to the other States. The industry is important to Australia from an overall point of view because overseas earnings are vital. The further progress and development of the sugar industry is of increasing importance to Queensland and to the Commonwealth generally.

The sugar industry has a wonderful record. It is a fascinating industry for those who know it. Many years ago, it was thought that the sugar industry, as a white man’s industry, would never succeed in this country. The state of efficiency it has attained to-day is a monument to people who have gone before, as well as to those who are playing their part at the present time in (he various sections of the inlustry. I commend the legislation to honorable senators.

Senator O’BYRNE:
Tasmania

.- The bill before the senate, which seeks to extend to 1967 the period of the Sugar Agreement, should receive the close consideration not only of Queenslanders but of all the people of the Commonwealth. Having spent ten years of my life in Queensland, I realize that the sugar industry has been one of the mainstays of that State. It has induced a degree of decentralization that would not have been possible had not the industry been of such strength and vitality. It is interesting to reflect, Mr. Acting Deputy President, that over a period of years the sugar industry has agreed to parliamentary approval of the price of sugar. The people, through the Parliament, fix the price of sugar, and in that way the industry is, to all intents and purposes, an open book. It is subject to public scrutiny at any time.

We have seen the sugar industry develop. It was founded on the somewhat shaky basis of the suitability of the Queensland climate for sugar-growing. The rapacity of the early owners of the land on which sugar is grown was shown by their wish to indent coloured labour with which to carry on the industry. I pay a tribute to those who drew up the Sugar Agreement more than 40 years ago. Their idea that the industry should be run by Australians for Australians, and that we could compete with the people of other parts of the world in our ability to work in the tropics, has been fully justified. Perhaps I might also pay a tribute to the Queensland Labour Government and the Federal Labour Government which were instrumental in the negotiation of the agreement.

Senator Wright:

– But it was the BrucePage Federal Government which was chiefly responsible for the agreement.

Senator O’BYRNE:

– I do not propose to argue about who had the greatest influence on the agreement. I think that the Andrew Fisher Government and the Queensland Labour government of the day were mainly responsible for it. Concurrently with the development of the sugar industry in Queensland and the great battles that were fought to establish it, was the task of establishing suitable conditions for the employees and the growers. In this connexion, I have great respect for my distinguished colleague, Senator Courtice.

As a worker in the cane-fields and as an organizer for the growers, Senator Courtice devoted the greater part of his life to assisting the industry to prosper and to ensuring that its views were given adequate expression. For the last 25 years, in the Senate, he has consistently brought to the notice of honorable senators the trials and tribulations of - the industry, always in a polite and fair way, without ever trying to obtain unfair advantages. As Senator Courtice is shortly to retire from the Senate, I want to place on record my personal appreciation of the work that he has done as a pioneer and as a great stalwart, not only of the Australian Labour Party, but also of the Queensland sugar industry;

Senator Wright made a valuable contribution to this debate when he stressed the need for the sugar industry to realize the importance of its complementary industry, the berry fruits industry. I do not propose to cover ground already covered by him, but 1 want to refer to some figures that I have before me in order to indicate the position of the Tasmanian berry fruits industry. As honorable senators will see, considerable variation has occurred in the industry. In 1938-39, there were 2,028 acres under raspberries in Tasmania. The latest figures that are available show that the figure has declined to 853 acres. There was a peak of 312 acres of strawberries in 1938-39, and there are now only 55 acres. In 1949-50, there was a peak of 2,775 acres of other small fruits, but that has been reduced to 1,16! acres. It can be seen, therefore, that both the tonnage of berry fruits production and the area under crop have declined alarmingly.

The lesson to be learned from those figures is that the Queensland sugar industry is the loser because of the decline in production of berry fruits in Tasmania. The local market is declining because the majority of Tasmanian berry fruits arc exported. The export of berry fruit means that there is a profitable market, indirectly, for the Queensland sugar industry. That point has been consistently overlooked in the reports of the Fruit Industry Sugar Concession Committee and also in the various debates concerning the sugar industry that have taken place in this Parliament. The areas that are used in “Tasmania for berry fruit production are singularly suited to such production. In many instances, specially selected hillsides and valleys are used for the purpose. It is unfortunate that such a great decline in acreage and production has occurred.

It is imperative that the sugar industry, along with most other Australian industries, be sustained. We are feeling the cold winds of international complications in the field of trade. Last year, we were fortunate enough to receive an order from the United States of America for 90,000 short tons of sugar, at a price which was quite advantageous. But there is no guarantee that this type of order will come to us in the future. The period of this agreement - up until 1967 - may be fraught with many difficulties for the industry. I believe it is a pity that the committee which was set up to inquire into this industry did not report on all its aspects. In his secondreading speech the Minister pointed out that it would be foolish, especially at this difficult period when for every buyer there are many sellers, for Australia to publish an authoritative report of the working of the industry and its cost structure. Such a report, he suggested, could be used by our competitors to our disadvantage. However, I believe that it is a pity that this evidence had to be covered up, because other industries are investigated by committees and the reports are openly available to members of this Parliament.

A margin of 2d. per lb. may appear small, but the industry’s best interests are not served by the Colonial Sugar Refining Company Limited investing outside the sugar industry. The sugar industry is now at a stage where its efficiency can assure its survival. As Senator Dittmer has already pointed out. the industry is being mechanized by degrees. Senator Dittmer said that 5 per cent, of the cane was being cut by mechanical cutters and 50 per cent, or more of the cut cane was being gathered by mechanical means. It appears that the sugar industry, like many others, has reached the era of automation, and that further economies will be effected. I believe that if the production of raw sugar is not in a flourishing state, the refining section of the industry will be in great difficulties. If the C.S.R. company has funds to invest this is the field in which to invest them. It has been said that it is better for companies not to have all their eggs in one basket. The C.S.R. company has enjoyed many concessions and advantages over the years. It is a pity that it should be more interested in profits from investment than in safeguarding the interests of the sugar industry. The company has made large profits from the refining of sugar. If the company directed its energies towards improving the lot of the growers, it would ensure that it received a reasonable return for its investment.

Various spokesmen for the sugar industry have pointed out that it has reached a very high state of efficiency, but that efficiency is restricted because of the high capital value of sugar-growing land. The owners of small farms find it impracticable to invest in large-scale plant such as tractors and other equipment. The bigger farms can carry higher capital investment, interest charges and maintenance costs.

There is an urgent need in the sugar industry for some kind of equipment pool. Over the years, the sugar industry has been prepared to follow a planned policy. It has had a plan - a purpose - and has been in close contact with the Commonwealth Government on the matter of prices. The industry should be aware of the great advantages of having an equipment pool. This Government has dispersed other equipment pools. If equipment pools were established the newly-developed mechanical cane-cutters could move from farm to farm, and the growers’ harvesting costs could be reduced. This would not be possible if only one or two farmers banded together to buy equipment. The sugargrowers themselves could form a cooperative company, or the Commonwealth Government could establish an equipment pool. The C.S.R. company could invest in an equipment pool some of the money that it has earned from the industry.

Senator Branson:

– lt could be done by contractors.

Senator O’BYRNE:

– That is another alternative. Firms like Thiess Bros., which virtually has a pool of earth-moving equipment, could, where the job is beyond the scope of a small farmer, move in and minimize the amount of labour needed, thus doing a very worth-while job. It is in the harvesting of sugar that any future challenge to the industry will have to be met.

The question of cost applies equally to the sugar industry as to our other primary industries. That subject has been discussed on many occasions. In this industry the cost of land and fertilizers, as well as other ancillary costs, is a very great burden on the grower and reduces his profit margin. 1 have just referred to the harvesting, collecting and handling of cane. The next phase is the cost of processing the raw materials. The technique of processing which was evolved in Queensland deserves the highest praise. It is equal to any technique in the world, and in their reports people who are well informed on the sugar industry all state that they cannot fault the techniques being used at present. Nevertheless, there is a long way to go before perfection is reached, if it is ever reached. The scientists, engineers and people with ideas will continue to contribute to the further improvement of techniques in the processing of the raw material. I hope that the reduced costs will be reflected in either a fair return to the grower or, much better, in a reduction in the price of sugar to the Australian consumer.

The storing and the handling of sugar are other aspects of the industry that are under constant review. They affect the final price of sugar considerably. Great strides have been made in bulk handling. I have seen men working in the tropical rains of Queensland with a bag over their heads, and carrying huge bags of raw sugar on their shoulders. To-day, with bulk handling, the position is entirely different and the work output has been multiplied considerably. I believe that this improvement in handling techniques has been a great advantage to the industry and has helped it to ride out the inflationary storm to a certain extent.

There is no room for complacency in the sugar industry. The International Sugar Agreement has gone completely haywire. As a result of the actions of some countries the state of equilibrium of sugar marketing has been upset. The fact that we have received temporary relief by being able to sell our sugar to the United States of A. .erica should not make us complacent. Great Britain’s entry into the European Common Market will have an effect on the sugar industry. For this reason we should not rest on our oars but should continue, as has been the case for years, to expand the yield per acre by bringing in new and efficient techniques all along the line. Our objective should be, first, to reduce the price of sugar to the Australian consumer and, secondly, to make quality sugar available for export at a worth-while price.

The sugar industry is important because it encourages decentralization. If the area of land it occupies - an area relatively unsuitable for any other industry - were not in use, we would be very vulnerable to criticism from other parts of the world. The sugar industry also supplies a quality product that is a source of energy. Without sugar we would be very sour indeed!

My colleagues and I have great confidence in the ability and resilience of the sugar industry. We would like it to continue to prosper, to give continuity of employment, to reach the goal for which it is striving, and to know that all Australians appreciate the fine job it is doing. I support the measure.

Senator LILLICO:
Tasmania

.- One thing that has emerged from this debate is that honorable senators are in agreement about the great efficiency of the Queensland sugar industry and its importance in the economy of the Commonwealth. The committee that was set up recently to inquire into the structure of the industry was also satisfied on those counts. It referred to the industry’s great efficiency and, of course, to its value to the economy of Australia.

This bill does not affect just one State. We realize it is of great importance to

Queensland, but it is of importance also to the Commonwealth. It is true that the industry is protected against the importation of sugar but it redeems itself, in my opinion, because it was responsible last year for earning more than £30,000,000 of Australia’s export income. In the circumstances that exist at present it is important that we should retain and expand our export markets. It is a great pity that other industries which are receiving a substantial measure of protection are not in the same category. The export earnings of the sugar industry completely vindicate the continued operation of the Sugar Agreement.

The sugar industry, like a lot of other industries, has an uncertain future because of the implications of Britain’s joining the European Common Market, an increased cost structure and other reasons. 1 note that exports of sugar increased last year. We exported sugar to the United States of America for the first time. That was brought about by the cessation of imports into the United States of sugar from Cuba. We do not know how long that position will continue. Cuba found markets in Communist countries which in all probability are not as satisfactory as markets in the United States and Canada. In addition, I believe that our exports to Canada have increased, as well as those to Hong Kong and Japan. On the surface it would seem, if it were not for the implications of the Common Market, that our export position is reasonably secure.

I was interested to read not so long ago a statement by Dr. James Vernon, the general manager of the Colonial Sugar Refining Company Limited, In a statement printed only last week he said -

At this stage we see no reason why the Commonwealth Sugar Agreement should not be accepted by the Common Market countries on a continuing basis, or alternatively, why its substantial equivalent should not be guaranteed on a long-term basis.

That, of course, contradicts every other opinion that has been expressed.

Senator Courtice:

– Do you not think that is a bit of speculation?

Senator LILLICO:

– It could well be. So far as the impact of the Common Market on the export of Australian sugar is concerned, there is much conjecture. I note that the committee has said that the tendency in Europe is, and will continue to be, to encourage the production of beet sugar. I also note that Senator Dittmer referred to the fact that it was provided in the Treaty of Rome at the outset that a very substantial tariff was to be placed on sugar imported into the Common Market countries. We have an agreement with the United Kingdom, under which substantial quantities of sugar from this country go there. If the United Kingdom joins the Common Market and another suitable agreement cannot be made, damage will result to the Australian industry. In other words, if Britain enters the Common Market, with the worst effects for Australia - again that is a matter of conjecture - the impact on our sugar industry will be fairly substantial. Consequently, this agreement must be entered into with a good deal of uncertainty. It remains to be seen, a? time passes, what will happen to this most important export industry.

I took note of Senator Wright’s opinion in regard to the rebate to fruit processors, and I also noted the contrary opinion expressed by Senator Wood. It seems to me that as the principle of a rebate to fruit processors in both the export and domestic trades has been endorsed for nearly 40 years, it has become well established. The principle has been endorsed so often that the committee set up in 1953 expressed the view that it had become a part of the structure of the agreement itself. The principle has been accepted so often and for so long that dislocation would be caused if steps were taken to discontinue it. After a rebate has been endorsed for over 40 years, surely there is something to be said for its continuation. I suppose this matter has been discussed by various Parliaments. It has been inquired into by other committees, none of which has seen fit to discontinue the rebate. As Senator O’Byrne rightly pointed out, if fruit processors are in a prosperous position - they are not, so far as Tasmania is concerned - and are expanding their activities, they are creating a better local market for sugar, which is the best market of all. For the life of me, I see very little difference between a rebate being paid to fruit processors within the structure of the sugar scheme and a subsidy being paid to them out of Consolidated Revenue. As the

Minister said when introducing this bill, in the final analysis it is the taxpayer or the consumer who actually pays the rebate to the fruit processors. It is arguable whether it should be a matter for the taxpayers or for the consumers. The cost is borne not by the sugar-growers, but by those persons who consume sugar or by the taxpayers of the Commonwealth.

It is a matter of interest to me to note that the committee recommended that the price of sugar be decreased by -id. per lb. That would have meant a reduction of from £2,000,000 to £2,500,000 in the returns to the industry. The present rebate of £5- a ton involves a total of only £265,000. The Government ignored the recommendation of the committee to reduce the price of sugar. Surely it is reasonable that out of what might be termed the saving to the growers because of the non-adoption of the committee’s recommendation, some additional rebate should be given to the fruit processors. 1 have found a lot of difficulty in perusing this report. It has been pointed out that much of it has been withheld because it was not deemed advisable that some of the evidence should be made public. However. 1 did take note of what the committee said at the commencement of its report. In paragraph 2, the report states -

The cost finding formula recommended by the 1952 committee and approved by the Government is satisfactory and has yielded profits for growers, millers and refiners that are reasonable and adequate.

After having said that, the committee proceeded to advocate a new formula. It proposed to pull down a scheme which had operated successfully and to put in its place a new method of arriving at a reasonable price to the growers. That reasonable price involved a reduction of id. per lb. The committee’s comments on the rebate to the fruit processors leave me up in the air. It said -

That the relationship between the manufactured fruits industry and the sugar industry is good, the former realizing that the sugar industry has been very co-operative, and the latter admitting that a successful domestic fruit processing industry provides an outlet for sales of sugar.

Ir. effect, the committee says that the rebate agreement between the sugar-growers and the fruit processors has worked satisfactorily for a long time and that there has been great co-operation. In other words, the agreement has worked well. After having said that, the committee goes on to recommend that, so far as citrus fruits are concerned, the rebates should be discontinued.

Sitting suspended from 5.45 to 9.43 p.m.

Senator LILLICO:

– Before the suspension of the sitting, I was talking about the rebate that has been in operation for a number of years. I have heard this contention advanced: Because a tax is being paid by the consumers of sugar in the price that they pay for that sugar and the price of sugar is taken into consideration in assessing the basic wage, that tax has an effect on the basic wage. Surely it is obvious that the rebate that is paid to the fruit processors amounts to only a fraction of Id. per lb. in the price of sugar. The effect of the rebate on the basic wage would be microscopic. I believe that that contention can be discounted.

Before 1 conclude my speech, I should like to quote further from the report of the I960 Sugar Enquiry Committee. Subparagraph 5 of paragraph 571 reads -

There was agreement that the domestic rebate of £5 per ton on sugar used for processing fruit has little effect on the prices paid by processors for fruit, or on the prices paid by consumers for the processed products.

That paragraph, as it stands, seems to indicate that the rebate is of little benefit to processors of fruit and has little effect on the prices paid to the fruit-growers.

However, part of paragraph 373 of the report of the 1952 Sugar Enquiry Committee reads -

  1. . However, with the rebate at the low rale of £2 4s. per ton and sugar at £64 per ton, there was a possibility of some processors disregarding the rebate if they could obtain fruit at prices lower than those prescribed by the Committee. He-

That is, a representative of growers of canning fruits - maintained that the rebate should have been increased as the price of sugar rose and on his own calculation requested a rebate of £10 18s. 6d. per ton based on the present price of sugar.

Senator Wright:

– That was £64 per ton, was it not?

Senator LILLICO:

– Yes. That report was presented in 1952. In other words,

Mr. Acting Deputy President, that committee maintained that the rebate was too small to be effective because the processors could get round it; whereas if the rebate had been increased commensurate with the increase in the price of sugar it would have been effective and the processors would not have been able to disregard it.

After saying in sub-paragraph 5 that the rebate has little effect on the prices paid by processors for fruit, the 1960 committee, in sub-paragraph 6, seems to me to contradict that statement completely. Subparagraph 6 reads -

Nevertheless, the domestic rebate-

That is the rebate about which it was speaking in sub-paragraph 5 - is of great value to the fruit-growing industry because of the condition that it is available only to those processors who pay growers the minimum prices determined by the Fruit Industry Sugar Concession Committee. This is a price stabilizing factor of great importance to growers and enables co-operative processors to contract for supplies in the knowledge that their proprietary competitors are paying the same prices.

I repeat that after saying that the domestic rebate was of little use to fruit-growers, the committee went on to say that the rebate was of great importance to the growers. Having said that, the committee proceeded to recommend that the rebate be abandoned with respect to citrus fruits and eventually abolished with respect to the whole fruitprocessing industry. This report seems to me to be most contradictory and difficult to understand.

I repeat what I said at the beginning of my speech: There may have been a break during which time no rebate was paid, but for 40 years the rebate principle has been agreed to by both Houses of this Parliament and by various committees. It is an integral part of the whole sugar industry set-up. I believe that, in view of the parlous condition of the fruit industry, particularly in Tasmania and also in the other fruitgrowing States, if the rebate had been increased commensurate with the increase in the price of sugar a very distinct benefit would have been conferred upon the fruit-growers of the Commonwealth. I believe that the rebate should be increased, and for that reason I propose to support the amendment foreshadowed by Senator Wright.

Senator COURTICE:
Queensland

– Mr. Acting Deputy President, after the great privilege that we have enjoyed to-night, of listening to extraordinarily soul-moving speeches, I find it difficult to bring myself to a discussion of an everyday commodity such as sugar. However, the show must go on. 1 am very pleased that in this Senate the Sugar Agreement is no longer a controversial matter. It was not always so. When I first entered the Senate, many senators were not very favorably disposed towards the sugar industry and the sugar agreement. But after a great deal of effort, after Prime Ministers and other members of the Parliament had visited Queensland and gained a more intimate knowledge of the industry, that feeling of hostility was gradually overcome, and the sugar industry to-day is appreciated as a great and valuable Australian industry. To-day, the only discordant note - not a very loud one - has been uttered by Senator Wright and Senator Lillico, in connexion with the rebate. They have some justification for their argument, but the industry generally believes, and many other people also believe, that there are other and better ways in which the fruit-growers might receive a fair deal. I have never been hostile to the rebate, because that would be a sort of repudiation on my part. In the early days, before the agreement was made, I was one who went to New South Wales and Victoria to meet the fruit-growers in order to try to break down their hostility to an agreement. Being engaged in a primary industry, we had no desire to embarrass or hurt the fruit industry. On the contrary, we wanted to help it, and we supported some system of rebate in order that that industry would not suffer in any way from an increase in the price of sugar or by a change in the conditions of the sugar industry. Associated with the making of this agreement was a desire by the authorities and by the industry that the fruit-growing industry should not suffer because of the agreement. I have never felt any hostility towards arguments of the kind advanced by the two honorable senators from Tasmania to-day, but I know that the sugar industry is not pleased about the situation, and believes that some other method should be adopted to deal with it.

I should like to comend the Government upon the bill. The Prime Minister (Mr. Menzies) has become intimately acquainted with the sugar industry because of his frequent visits to Queensland, and he has become a great advocate for it. He appreciates its value to Australia. He recognizes its great efficiency. I have attended conferences in Queensland at which he expressed amazement at what he bad learned of the industry’s activities and the general advancement, technically and otherwise, that had been achieved over the years. I am very pleased indeed, particularly at the latter end of my days here, that no longer will the Commonwealth Parliament be averse to this great industry. This Parliament has recognized the industry’s value, which has proved itself in time of difficulty. When we were in government, imported sugar cost 18d. per lb. The Australian sugar industry, because the price of its product was fixed, has often been a great help to the country’s economy.

It is possible for this Government, through its investigators, to turn the searchlight upon the industry, which has available complete information, extending over a period of 50 years, about every sugar farm, its production, and the income tax paid upon its earnings. This information is available also in respect of every mill. If Senator Wright came to my farm at the end of the year, he could send to the powers that be a report on its total production, costs, expenditure and everything about it. All of this information is available to the Government and to its investigators. My experience is that over the years the Government, in fixing a price, has invariably endeavoured to do the fair thing by the community and by the industry. It is a great comfort for a government to be sure that an industry cannot exploit the people in any way.

The most recent inquiry was conducted under the chairmanship of Sir Mortimer McCarthy, who was chairman of the Tariff Board when I was Minister. I know him intimately. He was associated with me in many things, and I have great respect for his ability. In the report, he stated that the committee’s decision was based on the position as it existed at the time of the inquiry. If he understands the sugar indus try - and I think he does - he must realize that it has great fears for its future. There are dangerous possibilities ahead. The efficiency of the industry is based on volume of production. It has been induced by the State Government and the people to expand as far as possible in order to develop the State. I for one believe that it has been over-ambitious. The only value of a product is its value in the market. It is of no use to make a lot of sugar unless we can sell it. This is true of any other product. More than half of our sugar production is being sold overseas. In the past, the preferences accorded by the United Kingdom Government have been a sheet anchor. We could never have developed the industry without those preferences. For many years, the industry has been assured of a market for two-thirds of its exports at a given price for a certain quantity and at world price for the balance. All that might disappear. The possibilities for beet sugar production within the European Common Market are very great, indeed. What I am now saying is only speculative, and I do not want to discuss this aspect further.

The sugar industry must sell more than half of its production overseas on world markets in competition with sugar produced in other countries by cheap labour. We are the only cane-sugar producing country using white labour, but we are in competition with other countries with much lower standards, and if we have to compete with them without any safeguard the industry will be in a very difficult situation. This has been a marvellous industry for tropical Queensland. I do not think that any other product to-day is more valuable to the nation. Whatever may be the developments in meat production in the future, sugar is the most valuable industry in the north, and we have developed it to the greatest possible extent - in my opinion, to danger point. If the future looked clear, possibly the industry could stand a slight reduction in the price of sugar - say of id. per lb. - but I think that, in the present circumstances, it would be very bad policy for the Government to reduce the price. When meat and certain other commodities are purchased, almost half of the food has to be discarded, but there is no waste or deterioration with sugar. Because of waste, almost every other food product is much more expensive than sugar. Looking at the matter from that point of view, I do not feel that the Government is inflicting any hardship on the people of Australia by ensuring that the sugar industry will be reasonably prosperous. Indeed, I would sooner see this industry very prosperous in a State like Queensland, which needs population urgently, than see it carried on in the niggardly fashion that was the case for many years.

I commend the Government for introducing this bill. It is not only doing the right thing; it is being almost generous to the industry. I might have difficulty in persuading the Australian Labour Party to do as much for the industry as this Government has done. I think that what the Government is doing is wise, and will be to the great advantage of this country as well as of the industry. The industry has expanded greatly. Over the last few years, it has been earning £60,000,000 a year, and a terrific amount of capital has been invested in it. The export of sugar has brought more than £30,000,000 a year to Australia. Queensland also produces meat and dairy products. It is the greatest exporting State in Australia, and to a large extent its exports of primary products have assisted the development of manufacturing industries in the southern States. My complaint against the Government is that Queensland has been treated as the Cinderella State in everything relating to manufacturing and development. The only thing for which I can give the Government great credit is the consistent fairness of its attitude to the Queensland sugar industry.

There is hardly any need to discuss the agreement with which the bill is concerned, because it has stood the test of 40 years. Governments of all _ political complexions have said that the agreement is in the best interests of the nation. I was associated with this scheme at its inception, and I derive much pleasure from the knowledge that it has stood for so long. As I have said, in the final analysis its great value is that, under it, the people of Australia have a say on the price of sugar. A difference of id. per lb. in the price of sugar can mean prosperity or adversity for this great industry. The half-penny is the lowest unit in our coinage. That is the smallest price alteration that can be made, but a reduction by that amount of the price of a pound of sugar means a very large amount on a ton. We sell sugar by the pound, but it is produced by the ton. As I mentioned earlier, this legislation is almost unanimously supported by two Parliaments. That was not always the case, and I am gratified that it is so now. I am sure this support will continue. Any one who investigates the industry, whether it be Senator Spooner or any one else, finds that it is efficient. On one occasion the Prime Minister (Mr. Menzies) was present when some of the technical men gave half-hour lectures off the cuff on the industry. The right honorable gentleman said that those men would be a credit to any industry and in any walk of life. We have some very capable men associated with the sugar industry.

Over the years, technologists and others - indeed all sections of the industry - have co-operated closely to ensure the continued progress and prosperity of .the industry. Millions of pounds have been spent on technical investigations and experimentation within the industry. The other day Senator Gorton stated that it was regrettable that some industries did not make contributions to the Commonwealth Scientific and Industrial Research Organization. I strongly support him in that. Such industries obtain benefits from the work of that organization, and there should be closer liaison with it. The sugar industry, however, has been selfcontained; it has stood on its own. The industry has experimental stations in a number of places, and maximum efficiency is achieved in all phases. I am not closely associated with the industry to-day, but I can say without boasting that it is the most efficient sugar industry in the world. Queensland grows the best sugar cane and has the best extraction rate. That is not because we have larger mills. There are many larger ones in other countries, but they are not so efficient as ours.

My first association with the industry occurred 65 years ago at the laboratory of the Millaquin refinery, and I have been associated with it to some extent ever since; so it would not be unreasonable for me to traverse the industry’s record to-night. It was established on slave labour brought from various Pacific islands. Wages were in the vicinity of 2s. 6d. a week and conditions in the fields were those of slave labour. I remember very well when the late Sir Edmund Barton addressed the farmers in my district - most of the industry in those days was conducted on large estates - and stated that we would have small farms dotted around the place, and that white men would be associated with the industry. That was when white labour came into the picture. We started a long way behind scratch. The great success of the industry has been based on its domestic economy, The recompense of everybody associated with it is based on his work or production. This is not determined by some individual or in an arbitrary way. We have an authority on which is a representative of the growers and the millers, as well as a chemist and an accountant, presided over by a judge of the Supreme Court. AH the relevant information is placed before the authority, which determines values and prices for every one engaged in the industry. That is a reason why the industry has been so successful. If similar conditions obtained in the stevedoring industry, what a great thing it would be for this country!

The industry has always been based on the principle of a fair deal being given. It was very difficult at the beginning to bring that state of affairs about, but eventually it was achieved. Senator Sir Neil O’Sullivan’s uncle, Mr. Justice O’sullivan, was a great man. He was the first judge to preside over the arbitration section of the industry, and he rendered great service to it. Senator Dame Annabelle Rankin’s father was the first member of Parliament to make certain suggestions for controlling production and prices in the industry. He was not a Labour politician but a strong Liberal - much stronger than his daughter. I think. He brought in a bill which his Premier said would splinter every plank in the Liberal Party’s platform. He said that it would not do away with the right of the men engaged in the industry to determine their own affairs; Judge O’sullivan would determine the value of the cane, not the millers. Colonel Rankin was not able to get support from his party for that proposal, but the Labour Party took it up and agreed to implement it. Representatives of the farmers approached the Labour Party Government, and that was the -beginning of the present system. Thus, Colonel Rankin and the Labour Premier of Queensland played a great part in the history of the industry.

The sugar industry has not been spoonfed. We hear of bounties and things of that kind, but many of the pioneers in the industry lost all they had. I have known men to grow great crops of cane only to find, when it came to harvesting time, that there was no sugar in the cane. A great deal of hard work has been necessary to determine the most suitable varieties of cane to grow and how best to process it to extract the maximum amount of sugar from it.

Senator Dittmer:

– Proper utilization of soil is important, too.

Senator COURTICE:

– Yes. There has been a great deal of experimentation. When I was a boy, it was the common thing to hear people from the southern States of Australia, such as Victoria, say that it was not possible to live in north Queensland, that it was no place for white people. The sugar industry received no support from the people in the southern States in those days. Consequently, the industry had to fight a long battle. That is why its representatives went to the fruit-growers and to every other group which could assist in the advancement of the industry.

I am pleased that the sugar industry has been dealt with on a national basis. We in this Parliament have differences of opinion regarding certain industries and other matters, but there is no doubt that all parties are agreed on the need to safeguard the future of the sugar industry. The Commonwealth Parliament has power to review the industry from time to time and, on behalf of the people, to determine what it regards as a proper price for sugar. I believe that this bill will be passed unanimously by the Senate, as it was by the House of Representatives,. Nothing but good can come from the development of an industry which employs so many people and is of such value, not only to Queensland, but to Australia as a whole.

Senator Sir NEIL O’SULLIVAN (Queensland) [10.13]. - I am sure that those engaged in the great Queensland sugar industry and, indeed, the people of Queensland generally, will be more than gratified by the very understanding and sympathetic reception accorded to this measure by the Senate. At the risk of repetition, I remind honorable senators of the tremendous importance of the sugar industry to the Queensland economy particularly and to the Australian economy generally. Queensland has a favorable trade balance of about £150,000,000 a year, which is a very substantial part of the total Australian overseas balances. Of that amount, more than a quarter comes from sugar.

From Nambour, which is about 75 miles north of Brisbane, right through to Mossman, about 1,200 miles north of Brisbane, every coastal town with the exception of Gladstone, Rockhampton, Bowen and, to a less extent, Townsville, are dependent almost entirely on the sugar industry. From Mackay northwards, there is a greater concentration of white population in those latitudes than anywhere else in the world, due entirely to the sugar industry. Approximately 8,500 farm-owners and more than 30,000 other people are directly engaged in the industry. Apart from the cattle industry and the great mines at Mount Isa and Collinsville, almost the whole of the north of Queensland is dependent on the sugar industry for its well-being, its livelihood and its economy. Wool is the greatest of Queensland’s exports, meat is the second greatest and sugar the third. Anything which is likely to impair the efficiency or prosperity of the sugar industry will have an adverse effect not only on the economy of Queensland but also on that of the Commonwealth.

Senator Courtice referred to the earlier days of the industry, prior to 1915, when the Cane Prices Board was established. It is true that in those days there was not merely rivalry but great bitterness, as Senator Courtice no doubt remembers much more clearly than I do. The miller would go along to a farmer and offer a certain price for his cane in the field. The poor farmer would say, “But it has cost me more than that to produce it”. The miller would reply, “Well, take it or leave it”. As we know, the grower cannot mill his own cane. It must go to a mill. Frequently, in those days, the farmers in fact burnt their cane.

Senator Dame Annabelle Rankin’s father, who was widely experienced in sugar cane growing, attempted to get the political party to which he belonged to establish a cane prices board which would be constituted by representatives of the growers and the millers, and which would have the benefit of advice from technical men, accountants and chemists. It was to be presided over by a judge. Unfortunately, Colonel Rankin was not able to get his party to accept that proposal, but the late T. J. Ryan made it one of the main planks in the policy he advanced during the election campaign in 1915. His party won practically every seat north of Brisbane. That was the first time that a Labour government was elected to office in Queensland. Almost immediately, the Labour Government constituted the Cane Prices Board.

Senator Dittmer:

– How grateful the people were for it, too.

Senator Sir NEIL O’SULLIVAN:

– It was a magnificent piece of legislation. As I have said many times from this place, and from other places in this chamber, too, Labour has a legislative record of which Australians are justly proud. Not all Labour legislation is praiseworthy, but there are many abiding pieces of legislation introduced by Labour governments for which Australia will be grateful for a long time. Not all the wisdom is on this side of the Parliament, although I must admit that most of it is.

I think it is important to remind ourselves of statements that were made by the Minister for Health (Senator Wade) in his secondreading speech. For instance, the Minister said -

Of equal importance to price is the assurance of supplies. Past agreements have ensured, and this one will continue to ensure, that no matter how attractive the overseas price might be, Australian demand must be met first and at the prices fixed by the agreement.

For people whose industries depend on a constant, regular and readily available supply of sugar, it is most important to their planning, first, to be able to obtain sugar, and secondly, to know the price at which it will be available for a fixed period of years. The Minister continued -

I am sure every one will agree that to have guaranteed supplies at stable prices is a very desirable position to be in with any basic commodity, and that they will also agree that this position can only be achieved, when the industry producing the commodity has a guarantee of long-term stability.

That is what the Sugar Agreement aims to provide.

Reference has been made to the inquiry presided over by Sir Mortimer McCarthy. Incidentally, the report of the McCarthy committee was released in 1961, before the collapse of the International Sugar Agreement. Some of the committee’s explanations were made without knowledge of the impending collapse of the International Sugar Agreement. Dealing with the efficiency of the industry the committee reported -

There is no evidence of inefficiency in any section of the industry. There is, on the contrary, evidence that there has been no relaxation of efforts further to improve efficiency.

Sometimes greater production leads to reduced costs and better returns, but the production of cane in Queensland is very rigidly controlled. The Cane Prices Board has control over the allocation of areas. Each area must be assigned to a mill, and the mills are limited as to their production peaks. A farmer may have 500 acres under cane, but in the scheme of things only one-fifth or one-tenth of his land may be assigned. If you produce more than your assignment, it is no good to you.

Senator Dittmer:

– It is not a matter of acreage; it is a matter of cane tonnage.

Senator Sir NEIL O’SULLIVAN:

– The amount that may be sent to the mill from assigned land is controlled. It is no good urging growers to grow more cane and obtain a better return. If you grow in excess of your assignment, the mill will not take it. Millions of pounds have been spent on scientific development with a view to obtaining a better return from the cane.

The following statements in the committee’s report are worth bearing in mind: -

Whilst the industry is free from overseas competition on the domestic market, the relationship and interdependence of the different sections of the industry are a constant spur to greater effort and provide a form of watchfulness, rivalry and competition, which is as effective as overseas competition, but which has not the same disruptive consequences.

Australian export industries using sugar obtain their requirements at prices which do not exceed but which are sometimes lower than the costs at which the cheapest sugar available on world markets could be imported free of duty.

The report also states -

Due largely to increased efficiency, increased production and favourable’ seasons, the price requirement for raw sugar, based on actual experience in the last few years, has not been unreasonably higher than the 1952 level, when regard is paid to the increase in the general level of costs since that time.

The price of sugar since 1952 has increased only half as much as the price of other stable edible commodities, such as bread, butter, meat and milk. Sugar has increased in price only half as much as the other things that you see on the breakfast table. The reason for that is the increased efficiency in the industry. The committee of inquiry unhesitatingly reported that, despite the assistance it has received, the industry has not at any stage been unmindful of its obligations to reduce costs.

In his second-reading speech the Minister for Health (Senator Wade) made this very wise remark -

When an industry is protected, however, tha Government has a duty to the consumers, both to the housewife and to the industries which use sugar, to see that the industry is efficient and does not cloak excessive costs behind this protective barrier.

That was a proper observation. The industry must be very gratified to have an unqualified testimonial from this independent committee, which has placed on record its belief that there can be no doubt of the continued efficiency of the sugar industry.

It is to be hoped that in the course of time the sugar industry will find new markets. The future for our sales to Britain, if and when she enters the Common Market, is rather dull. At the present time, most of our export goes to Britain. She takes half of it for herself at a negotiated price, and in respect of the other half she undertakes to find a market at world parity, plus a certain preference in favour of our own product. But I am aware that the industry is itself making very strenuous efforts to obtain and develop new markets. Last year, we sold 90,000 tons of sugar to the United States. Unfortunately, we have no guarantee that orders from the United States will continue to be placed here. We know that the United States is very keen not only on the economic integration of Western Europe, but also on its political integration, if and when that comes about, as I think it will, the vast amount of money that the United States at present is spending in Europe will be considerably reduced. It is possible, if Australia is to pull her weight in the free world, that the United States will be very interested in our strength, not in our weakness. We are not an underdeveloped or under-privileged nation, but we are not a fully developed nation. We do not need or seek aid1, but we need trade. It is conceivable that the United States will buy more from us to offset the effects of Britain’s entry into the Common Market. At present we sell some sugar to Japan. Japan is our second-best customer.

Senator Mattner:

– At what price?

Senator Sir NEIL O’SULLIVAN:

– At world parity. I was interested in the views expressed by Senator Wright and Senator Lillico with regard to the assistance that they believed should be given to the fruit industry and to the processors of fruit. It is a fact of life, as was stated in the 1952 report of the McCarthy committee, that it is not the cost of jams and processed fruit that has caused a reduction in the sales of these commodities. Our eating habits have changed. Jam is not as familiar on the breakfast table to-day as it was ten or fifteen years ago. People have developed a taste for “ Marmite “, peanut butter and other spreads. Marmalade is perhaps the most popular jam on the breakfast table at present.

It is of the utmost importance to the sugar industry that the fruit processors should be prosperous. They use a tremendous amount of sugar. The sugar industry has a profound interest in the prosperity of the fruit processors. I submit that it is completely uneconomic to subsidize the growers of berry fruits and other fruits through the indirect medium of the price of sugar. It is quite true - there is no argument about it - that the sugar industry itself does not pay that assistance to the berry-growers and fruit processors, but it is an item included in the content of the lid. per lb. It is taken into account. We are still the cheapest sugar producers in the free world; but there is always the thought at the back of the minds of those interested in selling their commodity of the danger of buyer resistance.

It is held by the industry - and very properly so to my mind - that the price of sugar should not be loaded to give assistance to other primary industries. Since 1952 it has been urged upon berry-growers and other fruit-growers that if they require assistance - if they can make out a case for it - they should apply to the Tariff Board. They are entitled to protection just as much as persons engaged in any other industry, but not by the indirect means of loading the price of sugar. For that reason I propose to oppose the amendment foreshadowed by Senator Wright. It is not that I am unsympathetic towards the industry he has in mind. I want that industry to be prosperous. I want consumers to make bigger and better demands on Queensland sugar.

On that particular point, I wish to refer to passages in the McCarthy committee’s report on the relationship between the manufactured fruits industry and the sugar industry. The committee said -

The relationship between the manufactured fruits industry and the sugar industry is good, the former realising that the sugar industry has been very co-operative, and the latter admitting that a successful domestic fruit processing industry provides an outlet for sales of sugar.

The financial arrangements between the two industries are based on the system of export and domestic rebates, which is administered in a way that causes no particular problems.

The fruit industry would like the rebates to be higher, but, except in isolated cases, made no request for an increase in either the export or domestic rebate.

There is no fundamental reason why the sugar industry should be called upon to provide the stabilising factor, in the form of a domestic rebate, to the processed fruits industry. Steps should be taken to relieve the sugar industry of this responsibility; the amount of domestic rebate should not be increased and the area of its operation should be reduced.

Senator Wright:

– What do you think the McCarthy committee meant by the word “ fundamental “?

Senator Sir NEIL O’SULLIVAN:

– No real, logical or supportable reason. I think the Tariff Board is the proper place for the industry to put its case. The jam makers might as well approach the tin-plate industry and the printing industry and say to them, in effect, “ We use tin-plate and labels. We want a reduction in the price of tin-plate and labels.” Why pick on the sugar industry? The sugar industry does not pay the extra price; the consumer pays it. The jam industry might as well go to the printers of labels of jam tins and ask for a reduction in order to assist it.

Senator Wright:

– It happens to be one of the essential parts under.. the original sugar scheme.

Senator Sir NEIL O’SULLIVAN:

– I do not accept that. It was there, but I am opposing the retention of the £5 rebate. I think it is uneconomical and unsound that one primary industry should be levied with the responsibility of carrying another primary industry. If the primary industry of which Senator Wright is a champion feels it has a case, the proper place for it to go is to the Tariff Board. As far as the sugar industry is concerned, the agreement cuts both ways. During the war period, and for many years after, the sugar industry was selling sugar on the domestic market at about half the world parity price. But for the obligation that they had to their fellow Australians sugar-growers could have sold their product at twice the price they received for it in Australia. I repeat that one of the advantages of the sugar agreement is that it cuts both ways. The first obligation of the Australian sugar industry is to see that the demands of the Australian market are met in full at a price determined in accordance with the agreement.

Senator Mattner:

– And the sugar-growers get the cost of production.

Senator Sir NEIL O’SULLIVAN:

– They are not expected to sell at less than the cost of production any more than any other farmer is. That is a very elementary remark. If the sugar farmers sold at less than their cost of production, in a matter of time there would be no sugar industry.

Senator Mattner:

– They are not making a terrible sacrifice.

Senator Sir NEIL O’SULLIVAN:

– The industry, on the whole, is in rather a healthy state. It is not a flush industry and it is facing serious problems. It has to face the hazards of poor seasons and the hazards of markets.

Senator Mattner:

– What about land values?

Senator Sir NEIL O’SULLIVAN:

– In order to prevent inflation the Central Sugar Cane Prices Board must approve of the price at which a farm is sold, and that system keeps prices fairly stable. There is no speculation in cane lands because the price must be approved by the board.

Senator O’Byrne:

– What is the average price per acre of sugar lands?

Senator Sir NEIL O’SULLIVAN:

–

There is no such thing as an average price because cane is grown from Nambour right up to Mossman. The price would depend on accessability, transportation, rainfall areas, the ces. content of the cane and a lot of other factors. It would be very diffi- cult to say what is. the average price per acre just as you cannot say what is the average price of a suburban allotment.

Senator Branson:

– The value of sugar exports this year was twice that of wool. Sugar represented 15 per cent, of the gross national exports as against 7i per cent, for wool.

Senator Sir NEIL O’SULLIVAN:

That is not right. Sugar earned £34,000,000 and wool brought in, I think, £235,000,000. I do not know what figures you are quoting.

Senator Branson:

– The total sugar exports accounted for 15 per cent, of the gross national exports whilst wool accounted for only 7i per cent.

Senator Sir NEIL O’SULLIVAN:

That is for Queensland only. _ Sugar is in third place. Wool is first, meat second and sugar third.

Senator Scott:

– Would the honorable senator care to comment on the price per acre of a fair average property?

Senator Sir NEIL O’SULLIVAN:

I will later but not while I am dealing with this bill. The President is looking at me severely, so I think I should confine my remarks to the bill. I wish now to quote an extract from the second-reading speech of the Minister in reference to the findings of the McCarthy committee. The Minister said -

The committee’s report was completed in August, 1961, when the free market price was about £28 sterling per ton, and at that time the biggest cloud - the suspension of quotas under the International Sugar Agreement - had not then appeared. This has thrown the whole free sugar market into confusion. The price has since dropped as low as £19 15s. sterling per ton, and, although at the moment it has recovered to about £24 sterling, there seeems little prospect of a sustained recovery from these very low prices for some time at least.

I am quite sure that had this report been written with a knowledge of the collapse of the International Sugar Agreement, the recommendation of the majority of the committee for a reduction in price would not have been made. I have much pleasure in supporting the bill. I am delighted by the warm, sympathetic and understanding reception which has been given to it by the Senate. I hope that Senator Wright and Senator Lillico in due course will prepare a really substantial case to present to the Tariff Board and that the result will be that the industry they are fostering will be given adequate and just protection.

Senator WADE:
Minister for Health · Victoria · CP

– in reply - 1 appreciate the support that has been given to this bill by honorable senators on both sides of the chamber. All those who have taken part in the debate have spoken with a good deal of enthusiasm of the value of this industry to Australia and have expressed their desire to keep it prosperous. In passing, I would like to pay a tribute to two stalwarts from Queensland, sitting on opposite sides of the House, who may well have made their last contributions to a public debate. I refer to Senator Sir Neil O’sullivan and Senator Courtice. They have been associated for many years with this industry, and I am sure that history will record that the contributions they have made to its well-being have been of great value to Queensland and to the Australian economy generally.

The agreement under discussion covers a period of five years and three months. The point I wish to make is. that, in general terms, it is similar to the other agreements that have covered the past 40 years. The only differences are for minor machinery purposes. Much has been said about the efficency of the industry. I believe that one has to see the industry to fully appreciate its efficiency. Some two or three years ago, fortified by some of the southerner’s natural bias, I visited Mackay, when Senator Wood was good enough to show me what he could of the sugar industry in a short space of time. I have no intention of repeating what has been said to-night about the standard of the organization of the industry, and about its efficiency and prosperity, but I wish to point out the value of its production, which is of the order of £65,000,000 annually, is of tremendous assistance to the economy of this country. We are living in times when values seem to get out of proportion. We export £30.000,000 worth of sugar a year. When one speaks in terms of a budget involving hundreds of millions of pounds, that amount may seem to be insignificant, but it does represent a very substantial contribution to our overseas balances. When one inspects the bulk loading facilities at the various ports along our coastline, one realizes that the sugar industry has come to stay. The opinions that have been expressed in this House to-day indicate that members of all parties are determined to keep it prosperous.

Senator Wright referred to some of the problems facing the berry-growers, and he suggested that a sugar rebate of £10 a ton would solve their problems. Let me say to him and to any of his Tasmanian colleagues who are thinking along the same lines that I appreciate their desire to help an industry in their own State. I do not think any one could quarrel with that objective, but the point I make is that an increase of the rebate would not solve the problems of the berry-growers. The Sugar Inquiry Committee found that berry-growers did have problems, but it also stated in the clearest possible terms that the sugar industry should not be burdened by the payment of what is, in effect, a subsidy to the berry-growing industry. 1 am aware that it has been argued that the sugar industry does not directly pay the subsidy, and that the consumer does. If one follows that line of argument to its logical conclusion, the position is reached that a certain section of the community is paying a subsidy to a certain section of an industry. That is basically wrong. If an industry must be assisted, the cost should be borne by the taxpayers generally. It would be just as logical to argue that the wheat industry should subsidize the poultry industry. Who would argue that the poultry industry has no problems? Who would argue that it is not in need of support?

Senator O’Byrne:

– The wheat industry is subsidizing the poultry industry.

Senator WADE:

– The wheat-growers are not subsidizing the poultry industry; the taxpayers may be, but wheat-growers are not. I suggest that there are other means of assisting the Tasmanian berry-growers. The berry-growers themselves and the Tasmanian Department of Agriculture asked the Commonwealth Government to conduct a survey of the needs of the industry. This was undertaken by the Bureau of Agricultural Economics. The work has been completed and a report is ready for presentation. I believe that, arising out of this debate and the presentation of the report on the sugar industry, an opportunity will be presented to Tasmanian senators to give a lead in attempting to stabilize the berry-growing industry. I should like to be corrected if I am wrong, but I have never heard of the Tasmania berrygrowers making any concerted or organized attempt up to date to stabilize their industry. When the report from the Bureau of Agricultural Economics is presented, I believe an opportunity will be afforded those who are interested in this primary industry in Tasmania to get together to see if they can solve its problems and put it on a profitable basis.

I have in my hands a Queensland “ Hansard “ report of the debate on the first bill introduced into the Queensland Parliament covering the sugar industry. It was the Sugar Cane Prices Board Bill, and it was introduced by Lt.-Col. Rankin, whose name has been mentioned in this debate. The point I make in this connexion is that from this humble beginning, when an endeavour was made to stabilize the sugar industry, we have gone on to build one of the finest monuments to efficiency and organization that this country has in the rural industries sphere. I commend the bill to the House and ask for its support.

Question resolved in the affirmative.

Bill read a second time.

In committee:

The bill.

Senator WRIGHT:
Tasmania

.- Mr. Chairman, I wish to refer to clause 4 of the bill which reads as follows: -

The Agreement relating to sugar, and certain sugar products, made on the ninth day of April, One thousand nine hundred and sixty-two, between the Commonwealth and the State of Queensland, being the agreement a copy of which is set out in the Schedule to this Act, is approved.

I move -

At end of clause add “subject to substituting ten pounds (£10) per ton’ for ‘five pounds (£5) per ton’ as the amount of the domestic sugar rebate mentioned in clause 8 (2.) (b) of the Agreement “.

Senator Wade:

– I rise to order. I seek your ruling, Mr. Chairman, on the admissibility of this amendment. A vital principle is involved, because the amendment calls for the addition of certain words to clause 4, which reads -

The Agreement relating to sugar, and certain sugar products, made on the ninth day of April, One thousand nine hundred and sixty-two, between the Commonwealth and the State of Queensland, being the agreement a copy of which is set out in the Schedule to this Act, is approved.

On 9th April, 1962, the Prime Minister (Mr. Menzies) received from the Premier of Queensland this agreement, bearing the Premier’s signature. The Prime Minister signed the document on that date and I submit to you, Sir, that it was an agreement from that time. The principle with which I am concerned is this: I believe that we, as the Senate in committee, should not move to amend an agreement that has already been completed without the other party to the agreement being given an opportunity to have consultations on the proposed amendment. This agreement has been signed and sealed. This chamber has the right to reject the agreement. Of course it has! No one would argue against that. I submit to you, Sir, that one of two courses can be pursued. Either we endorse the agreement or we reject it. I submit with great sincerity that we have no constitutional power to amend it.

Senator Wright:

– I should like to be heard on the submission made by the Minister for Health (Senator Wade). I wish to claim, on behalf of this House of the Parliament, that the process of subjecting an agreement such as this to the Parliament for approval is a real one. The parties to this agreement are now asking this Parliament to approve the agreement. This Parliament has the undoubted right to approve the agreement in toto, to reject it in toto, or to express its approval subject to certain conditions.

It is a complete misrepresentation of my proposition to say that my amendment attempts to amend the agreement. It does not.

Senator Sir Neil O’Sullivan:

– What does it do?

Senator Wright:

– It proposes that this Parliament express a condition upon which it will give its approval to the agreement. Let me illustrate the substance of that submission in this way: The Government and a responsible committee are in disagreement about the price, and a bill is introduced to approve an agreement that has fixed the price of sugar at £90 5s. 2d. a ton. Is it to be seriously suggested that we in this House of the Parliament are to be stultified and that we cannot send the agreement away, saying that we believe that the price should be £95 a ton or, as the committee recommended, about £85 a ton?

Senator Sir Neil O’Sullivan:

– That would be rejecting the agreement, would it not?

Senator Wright:

– Mr. Temporary Chairman, the staccato interjections that arc coming from the back of the chamber would be better delivered as a reasoned series of propositions, if the interjections are connected with reason. We are performing a serious function and we are asked to approve an agreement. Who in this place will say that we have not the right to express our approval of any condition that is relevant to the substance of the bill? I submit that the point of order is not well taken.

Senator Benn:

– Mr. Temporary Chairman, I ask you to hear me, as a representative of the Opposition, on this matter.

Senator O’Byrne:

– Are you speaking to the point of order?

Senator Benn:

– I am certainly speaking to the point of order; but in dealing with the point of order I will state the intention of the Opposition. I hold the opinion that the amendment submitted by Senator Wright is completely in order. In committee, we are entitled to consider the amendment and deal with it on its merits. As Senator Wright has said, we have the power to reject it or to approve it. I add for your benefit, Mr. Temporary Chairman, that the intention of the Opposition is to reject the amendment if it is in order, by voting against it. I have nothing more to say on this matter.

The TEMPORARY CHAIRMAN (Senator McKellar:
NEW SOUTH WALES

– I have been considering this matter for the past three- quarters of an hour. I am fortified in the decision I have reached by my memory of a ruling on a similar subject that was given by a previous Chairman of Committees. That ruling dealt with an agreement that was made between the Commonwealth and a State. I remember that the Chairman of Committees said that he had to rule the amendment before the Chair out of order. I believe that this amendment is out of order. I am fortified in that belief, first, by the advice of the Clerks and, secondly, by looking at page 554 of May’s “ Parliamentary Practice “. Consequently, I rule the amendment out of order.

Senator Wright:

– Mr. Temporary Chairman, I wish to move that you do report progress and ask for leave to sit again so that I may have an opportunity to prepare an amendment giving expression to the purpose of this amendment, and then submit it to the Senate for judgment. I trust, Mr. Temporary Chairman, that the sentiments that have been expressed about the endeavours of Colonel Rankin, without the support of his party, to succour a small industry are genuine, and that you will give me an opportunity to frame, within the terms of your ruling, an amendment that will be acceptable to this chamber.

The TEMPORARY CHAIRMAN.Order! Do you object to my ruling? If you do not, I do not think that you can move at this stage that I do report progress.

Senator Wright:

– Why can I not move that you report progress? Any member of the committee may move that the chairman do report progress so that the Senate may have time to consider a matter.

The TEMPORARY CHAIRMAN:

– Order! You may propose the motion, but there can be no debate on it.

Motion (by Senator Wright) put -

That the Temporary Chairman do report progress and ask for leave to sit again.

The committee divided. (The Temporary Chairman - Senator G. C. McKellar.)

AYES: 6

NOES: 43

Majority .. ..37

AYES

NOES

Question so resolved in the negative.

Consideration interrupted.

That the Temporary Chairman do now leave the Chair and report to the Senate.

Question put -

The committee divided. (The Temporary Chairman - Senator G. C. McKellar.)

AYES: 21

NOES: 21

Majority . . . . 6

AYES

NOES

Question so resolved in the negative.

Consideration resumed.

Senator WRIGHT:
Tasmania

.- Mr. Chairman, I now wish to submit an amendment to clause 2, which reads -

This Act shall come into operation on the day on which it receives the Royal Assent.

There is a precedent for my amendment, if I may be so impertinent as to anticipate objections to its admissibility, because a similar amendment was accepted in this chamber on 31st October, 1956. I move -

Leave out “ on the day on which it receives the Royal Assent “, insert “ only if and when the agreement referred to in section 4 is amended to provide a fund for the domestic sugar rebate at a rate per ton proportionate to the current Australian price of sugar”.

I tender the amendment in signed form. I wish to take the opportunity to submit in as brief and terse a form as I can some of the reasons that should enable the amendment to be accepted by the committee. We have the authority of the Minister, given in his second-reading speech, that the cost of the domestic sugar rebate is met, not by the sugar producer, but by the Australian’ consumer, through the price that is fixed for sugar under the scheme. It is indisputable that every one who has referred to the fruit-canning industry realizes that over the last five years in particular that industry has been more in need of support than in previous years. I express regret that it was not possible to arrange for the recent report by the Bureau of Agricultural Economics, which the Minister has informed us is at hand, to be made available for the purposes of this debate.

I wish to argue that the proposition of the Minister, supported by Senator Sir Neil O’Sullivan, that if the fruit-canning industry needs assistance the proper method of assisting it is by bounty recommended by the Tariff Board, has no validity. If the proposition were valid, it could be applied to the sugar industry itself, but it has no validity in this context. The original sugar scheme was conceived in the days when governments and politicians with ideas of development put them forward because in their judgment they were sound. This scheme was not put forward only to benefit the sugar industry. As Senator Courtice indicated in what he vouchsafed to the Senate to-night, those who sponsored it recognized that if it had embraced only the idea of benefiting the sugar industry with the security of this protection and had- not also embraced the idea of giving a benefit in commensurate measure to the fruitcanning industry, it would not have been accepted. The scheme will not be entire - it will be distorted - if the marriage that was then made between sugar and fruit is annulled.

The next point is that to administer the domestic sugar rebate we set up the Fruit Industry Sugar Concession Committee, which has the duty of fixing the minimum prices that shall be paid for fruit as a condition of the processors receiving the rebate. There are two reasons why this domestic sugar rebate has not been as effective as it should have been. As the McCarthy committee records, the rebate has been a factor - my colleague, Senator Lillico, quoted this - in stabilizing the fruit-canning industry, but it has still left many sections of this industry on an economic basis which reflects no credit on this Parliament. That is because the concession committee has not conceived its function to be the fixation of a minimum price for fruit as a prerequisite for receipt of the concession that would guarantee to the producer a payable price to cover his costs of production. Instead, the committee has glanced at the prospects of the market and said, as it were, “ We will fix a price that we think the processors will pay, having regard to the progress of the market “.

While the concession is insignificant, it is quite obvious that if the processor can forgo the concession and still buy on the market to advantage he will ignore the concession. Therefore, the size of the concession, of the rebate, is the all-important determinant.

Finally, 1 contend that this committee would do itself credit by accepting my proposal for this reason. I argued this proposition in 1952, when it was rejected for the reason that Senator Sir Neil O’sullivan put forward to-night. I think he was then the Minister in charge of the bill. The proposal was rejected for the same reason in 1956, but in the intervening period the Government has recognized the need to advance the domestic sugar rebate . for precisely the reasons that I have submitted. However, it wishes to increase the rebate from £2 4s. only to £5, which is still insufficient. It should bear the same relationship now to the price of sugar - £90 a ton - as it bore in 1931, when the price was £33 a ton. For these reasons, I ask the committee to consider seriously accepting an amendment which is designed to give some measure of benefit to the fruit-canning industry and the sugar industry proportionate to the measures of benefit that were given to each of these industries when the scheme was initiated.

Senator McKENNA:
Leader of the Opposition · Tasmania

– The honorable senator’s amendment raises an interesting question in my mind. First of all, apart from the amendment’s merits, I query whether it is in order under the Constitution. Section 53 of the Constitution provides, inter alia -

The Senate may not amend any proposed law so as to increase any proposed charge or burden on the people.

The proposal is to increase the amount of £5 referred to in article 8 of the agreement to £10 - in other words, to double the amount. Where does the amount come from? If we refer to clause 8 of the agreement, we see that paragraph (1.) states; -

The Slate-

That being the State of Queensland - on behalf af the Australian cane sugar industry shall during the agreed period assist the Australian manufactured fruits industry by creating a fund by an annual contribution of Two hundred and sixty-four thousand pounds (£264,000) payable in equal monthly instalments to the F.I.S.C.C.-

There, plainly, is reference to a payment by a State government from the revenues it raises from the people. In other words, it refers to a charge upon the people.

The fund represents a charge upon the people of Queensland and the revenues of that State to the extent of £264,000. The proposal before the Senate would have the effect of increasing that charge by doubling the amount of £264,000. Looked at from the view-point of the people of Queensland, unquestionably that would be a further charge upon them. That is the first point I submit.

The second point is that throughout the debate in the Senate it has been constantly alleged - and I doubt whether the allegation has been adequately controverted - that in the final analysis this amount is paid by the consumers of sugar. If one accepts that proposition - and I leave it to you, Sir, to decide whether it should be accepted or rejected; it may be a matter of controversy - the doubling of the figure would mean doubling the burden on the people of Australia.

I shall not at this stage go into the merits of the amendment moved by Senator Wright, but I invite you, Mr. Temporary Chairman, to clear the way for a discussion by ruling whether the amendment proposed by Senator Wright would have the effect of increasing a burden or charge on the people. If you hold that it would, the amendment will clearly be out of order.

The TEMPORARY CHAIRMAN:

– I uphold Senator McKenna’s submission and rule that the amendment is out of order.

Senator Wright (Tasmania) [11.23].- Mr. Temporary Chairman, that is a proposition which is so subversive of the Constitution that I propose to disagree with your ruling. When the Constitution refers to a burden or charge upon the people it refers to a burden or charge imposed by this Parliament. It is lamentable that anybody should hold the view-

Senator Kennelly:

– I rise to order. 1 take it that Senator Wright has moved that your ruling, Mr. Temporary Chairman, be disagreed with. That being so, is it in order for you to remain in the chair?

The TEMPORARY CHAIRMAN:

Senator Wright must put his objection in writing.

Senator Wright:

– Perhaps you will give me the opportunity to do so. I am interested not so much in the fate of this particular amendment as in the consequences of it. (Senator Wright having submitted in writing his objection to the Temporary Chairman’s ruling) -

The TEMPORARY CHAIRMAN.Order! Senator Wright has objected to my ruling. I shall report the objection to the President.

In the Senate:

The TEMPORARY CHAIRMAN:

I wish to report, Mr. President, that Senator Wright has objected to a ruling of the Chair. The honorable senator has submitted his objection in writing.

The PRESIDENT (Senator the Hon. Sir Alister McMullin). - I call Senator Wright.

Senator WRIGHT:
Tasmania

.- I have moved, Mr. President, that the ruling of the Temporary Chairman, that a certain amendment proposed by me to the Sugar Agreement Bill is out of order, be disagreed with. The ground of the ruling was laid by Senator McKenna and was to the effect that my amendment involved a breach of section 53 of the Constitution, which prevents this chamber from originating a proposal to increase a burden or charge upon the people. This raises the question of the interpretation of the expression “ burden or charge upon the people “.

Section 53 of the Constitution makes a distinction between the authority of this chamber and that of another place. It limits the authority of this chamber so as to prevent the Senate from originating bills to impose taxation or to appropriate revenue for the ordinary annual services of the Parliament. I speak without having the Constitution before me, but I think I have stated the provisions of the section accurately enough for the occasion.

The section contains the provision invoked by Senator McKenna, to the effect that no proposal may be originated in this chamber which has the effect of increasing a burden or charge upon the people. The several provisions in the section have their origin in the history of the monetary relations between the House of Lords and the House of Commons. A marked distinction is drawn between the authority of this chamber and that of the House of Representatives. The words “ burden or charge upon the people “ refer to an impost by means of which, under parliamentary authority, it is proposed to raise money from the taxpayers.

One turns to the bill before us to see whether or not it remotely touches the area of the provision of section S3 which has been invoked. The section does nothing of the kind, and only a few elementary words are needed to elucidate the purpose of this measure and to show that it lies completely outside the scope of a bill to impose a burden or charge upon the people.

What does this bill seek to do, Mr. President? It seeks the approval of the Parliament to an agreement between the Commonwealth of Australia and the State of Queensland. The State undertakes, as a result of the agreement, to use its powers of acquisition to acquire the sugar crop and then to deal with that crop. The agreement further provides that the sugar crop, when processed, shall be retailed throughout Australia at a price which is uniform in each State capital city. That presupposes the voluntary purchase of the sugar. A price will be fixed according to the contract entered into by the State of Queensland. That price is fixed in pursuance of these arrangements. Who has ever heard of a price-fixing arrangement in this or any other Parliament coming within the category of legislation to impose a burden or charge on the people?

The next point is that, the price being fixed, I want some sugar. Nobody suggests that I am bound to pay that price if I do not want to buy the sugar. So, if I pay the price fixed, I do so voluntarily, which is the very antithesis of a burden or charge imposed by taxation.

Senator Gorton:

– How does that differ from an increase of sales tax?

Senator WRIGHT:

– How does it differ from an increase of sales tax?

Senator Gorton:

– That is right. The payment of sales tax is voluntary. You do not have to buy the taxed article.

Senator WRIGHT:

– I pause before replying to that interjection so that we may absorb the suggestion.

Senator Gorton:

– So that you may think of an answer.

Senator WRIGHT:

– Is it suggested that time is needed to think of an answer to that interjection? Time is needed really to recover from the amazement caused by the asking of the question. As for sales tax, when the contract for sale is made, then by the direct authority of the sales tax legislation tax is levied on the party to the contract, but here there is nothing even remotely analogous to that suggestion.

Senator Henty:

– That is not correct at all.

Senator WRIGHT:

– Sales tax is levied upon the manufacture of the article. When you trade for sale by retail the tax is levied upon the sale. It is levied as a direct impost upon anybody who contracts to purchase or sell the taxed article.

Senator Gorton:

– But it is a voluntary purchase.

Senator WRIGHT:

– Of course, it is a voluntary purchase. When you make a gift it is a perfectly voluntary transaction. But once the transaction is made upon which tax is levied, a burden or charge is laid upon the people. It would be deplorable if an idea of the kind suggested even started to run in one individual’s mind in this place. There is a world of difference from the point of view of the provision that Senator McKenna invokes between taxing as a direct act of the Parliament a voluntary transaction and fixing a price at which an industry shall sell its products.

I hope that the Senate will take a proper view of section 53 of the Constitution. It is because of the general implications of this submission that I rise. I have fought my amendment sufficiently far for my purpose. I know that it will be defeated. I have stated my reasons, and there I remain content. But I am earnest in my contention that the Constitution should be properly interpreted in this place, and that this provision should not be misused for the occasion of the moment.

Senator McKENNA:
Leader of the Opposition · Tasmania

– I have pleasure in supporting the Chairman’s ruling. The provision of the Constitution is quite clear. It stands separate and apart from any other provision in section 53. I refer you, Mr. President, to the third paragraph of that section, which in clear and simple terms reads -

The Senate may not amend any proposed law-

This is a proposed law that is sought to be amended - so as to increase any proposed charge or burden on the people.

In express terms that is not related specifically to a burden imposed directly and nominated in express terms by the Parliament. I invite you, Sir, to consider how very wide the terms are -

  1. . any proposed charge or burden on the people.

Senator Wright’s argument seeks to narrow that to a case that is analogous to sales tax or some specific taxation measure. I submit that it has no such narrow restrictive meaning at all, and that the Constitution itself is left in the widest possible terms for no other reason than that it might have the widest possible application.

Returning to Senator Wright’s amendment, he proposes to amend clause 2 of the bill, which states that the act shall come into operation on the day on which it receives the Royal assent. Senator Wright’s amendment provides, in effect, that the act shall come into operation on the day upon which clause 8 of the agreement, set out in the schedule to the bill, is altered as to paragraph (2.) (b) so as to delete the words “ five pounds “ and insert instead the words “ ten pounds “. To understand the effect of that proposed amendment I invite you, Sir, to go to paragraph (1.) of clause 8 of the agreement which reads -

The State on behalf of the Australian cane sugar industry shall during the agreed period assist the Australian manufactured fruits industry by creating a fund by an annual contribution of two hundred and sixty-four thousand pounds (£264,000) payable in equal monthly instalments to the F.I.S.C.C. . . .

The application of the fund is referred to in paragraph (2.), sub-paragraph (b) of which states that a rebate of £5 a ton shall be paid to fruit processors using cane sugar. The moment we double that rebate we make a substantial addition to the £264,000 appropriated by Queensland. That clearly would be an additional charge or burden on the people of that State. The word “ people “ is not used in any narrow or restrictive sense. It would be an increased burden or charge on the people, meaning any of the people of Australia. This is not limited to the whole Commonwealth. It refers to the people. I submit that it refers to all or some of them. lt has been argued during the day in this chamber that the real moneys are provided by the consumers of sugar. I do not think we can satisfy you, Mr. President, as to the correctness or otherwise of that argument. That is a matter open to a good deal of disputation. I think that the Chairman was completely in order in ruling as he did.

Senator VINCENT:
Western Australia

– I feel that no one in the Senate should vote on this motion without being completely certain about the subject under discussion. The matter goes to the very heart of the powers of the Senate, and I am somewhat jealous of those powers. The first observation !. wish to make is this: If Senator McKenna’s objection is accepted there is barely an amendment that can be moved in this chamber that does not, according to Senator McKenna’s logic, impose some burden on the people, or increase some burden already imposed.

I invite honorable senators to have a look at any amendment that the Senate has accepted as being in order and I defy anybody to say that in some way it does not impose a burden. With great respect I think that it is the crux of this discussion. If we accept the proposition that this amendment be out of order we are, in effect, ruling a great number of amendments as being out of order, in pursuance of the objection of Senator McKenna under the authority of section 53 of the Constitution. With very great respect to Senator McKenna I do not think that Section 53 has anything to do with the proposition he has stated.

The first thing that Senator McKenna has to do is to show that there is, in the words of the Constitution, a proposed charge or burden. I submit that there is nothing in Senator Wright’s amendment that has anything to do with a proposed charge or burden. I will develop that submission in a moment.

Secondly, Senator McKenna must establish, with respect to that proposed charge or burden, that there is an intention to increase it. Section 53 of the Constitution provides -

The Senate may not amend any proposed law so as to increase any proposed charge or burden on the people.

That postulates two conditions precedent to the Senate disallowing this amendment. There must be a proposed charge or burden, and the amendment must then propose to increase that charge or burden.

Those are the two elements of this problem, and I suggest that neither is covered by Senator McKenna’s objection. As 1 have said, the amendment of Senator Wright has nothing to do with the proposed charge or burden. It relates to the provision of a fund, and that is all. There is no suggestion of where that fund shall come from or anything else to link it with anything in the nature of a proposed charge or burden. It does not necessarily follow that the proposed charge or burden is to be increased. There is no such suggestion. I feel that Senator McKenna’s objection fails lamentably.

The proposed charge or burden that Senator McKenna referred to in section 53 is of the nature of a taxation matter and has nothing to do with this fund. The Senate sets up funds and alters them, and it has done so during the twelve years I have been here and no objection has been taken. This is an attempt to whittle away the powers of the Senate, and that is why I rise to speak. I want to say one other thing. I think the Opposition is putting thi« objection forward because it is not prepared to vote on the merits of the bill.

Senator WOOD:
Queensland

.- It is with very great diffidence that I rise to speak on this occasion. I am one of the panel of Temporary Chairmen of Committees and I think that in this case we must consider the rights of the Senate. I want to make it very clear that I am not speaking on this matter because I come from a canegrowing’ district. I do not want my intervention to be interpreted as an intimation that I am in favour of Senator Wright’s amendment. I am opposed to it. The question that is being considered now has to do with the rights of the Senate and of senators and must be considered as distinct from the bill.

My view is that the amendment could have been ruled out of order on an altogether different ground. The agreement under consideration is a unilateral agreement between the Government of Queensland and the Commonwealth Government, and I do not think we have the right to move any amendment affecting that agreement. I think we should either accept the agreement in toto or reject it in toto. In the circumstances, I consider that the de,cision that the amendment is. out of order has been made on unsound grounds so far as the rights of the Senate are concerned. I am sorry, but I cannot support the ruling of the Temporary Chairman of Committees.

Senator SCOTT:
Western Australia

– Having listened with great interest to this debate which has been conducted, in the main, by legal members of the Senate, I come down on the side of Senator Wright and Senator Vincent. I do not think that the amendment will increase any charge or burden on the people of Australia. I believe that this amendment will not increase costs met by the people. It will be a matter entirely for the industry which receives so much a pound for its sugar.

There is something in the suggestion of Senator Wood that the amendment in its original form could have been thrown out on the grounds that were submitted by the Minister for Health (Senator Wade) in the first place. Having said that, I should like to add that I have had considerable doubts, during the course of the debate, whether the fruit processors in Australia, in consideration of the sum of £5 a ton mentioned in clause 8 (2.) (b) of the Sugar Agreement, would be getting sufficient to keep their industry in a stable condition: I understand - having read the agreement through hurriedly - that this clause relates to fruit that is processed for sale in Australia. If fruit is processed for sale overseas and is exported, then we have to turn to clause 8 (2.) (d) of the agreement which provides -

Subject to the provisions of this clause and of clause 16 of this agreement, the- F.I.S.C.C. shall, in respect of the Australian refined cane sugar content of fruit products for the time being approved by the F.I.S.C.C. under paragraph (b) of this subclause which are manufactured from Australian’ fruit and which are exported from Australia during the agreed period, pay to the exporters a rebate of the amount of the excess (if any) of the cost of such sugar contents calculated at the price of refined sugar of IXD grade shown in subclause (1.) of clause 6 of this agreement less the rebate shown in paragraph (b) of this sub-clause over the cost of such sugar contents calculated at the Australian equivalent of the world sugar parity price at the rates determined from time to time by the E.S.C. in accordance with clauses 14 to 18’ (both inclusive) of this agreement;

I think we must be very careful how we vote. We must endeavour to protect the powers of the Senate. I believe that Senator Wright’s amendment, if accepted, would not increase the cost, as was suggested by Senator McKenna. He stated that it would mean an increased charge on the people of Australia. I disagree with him on that. I support Senator Wright and Senator Vincent.

Senator SPOONER:
New South WalesVicePresident of the Executive Council and Minister for National Development · LP

– May I make confusion worse confounded by outlining the position as I see it? Senator Wright wanted an alteration made. The debate showed that the alteration was, generally speaking, not supported. Senator Wright then moved an amendment, the effect of which would be to. alter the terms of an agreement between the two Governments. That was ruled out of order, and Senator Wright moved to achieve his purpose in another way. The way he chose was in conformity with previous rulings given in this chamber. Therefore, we did not oppose it as being out of order. Senator McKenna took a point of order, saying that what Senator Wright proposed would involve an increased charge or burden on the people and, therefore, was beyond the powers of the Senate. Whether that view is right or wrong is a legal issue entirely. I do not concede that this is a matter which affects the powers and privileges of the Senate. It is a matter of the interpretation of particular circumstances that arise in relation to this legislation. I do not see this as a great question of principle. I see it as a question of the interpretation of facts surrounding a particular issue. For my part, whatever your ruling is, Mr. President, I will support it.

The PRESIDENT:

– The objection is upheld and the ruling is disallowed.

In committee: Consideration resumed (vide page 1248).

Senator WRIGHT:
Tasmania

.- I have already stated” my reasons in full. I am sensitive of the opinion of the committee on the merits of the matter. I submit the amendment, which has now been ruled to be in order, to the judgment of honorable senators.

Senator WADE:
Minister for Health · Victoria · CP

.- On behalf of the Government, I say that, for the reasons which I gave at some length this evening, the amendment is not acceptable.

Amendment negatived.

Senator MATTNER:
South Australia

– I am not clear on the ruling that has been given - although I do not question it - and I seek a little information. It seems to me that, under that ruling, we can either pass or reject this bill. We are not allowed to express any opinion on it whatsoever.

Senator Benn:

– I take a point of order. I did not hear Senator Mattner clearly, but my understanding of his remarks is that he is speaking against a ruling by the President.

The TEMPORARY CHAIRMAN:

– No, that is not right.

Senator MATTNER:

– I return to where we were at about 11 p.m., when I hoped that we would adjourn and thus be afforded an opportunity to think this matter over. I should like to know whether the ruling given means that we cannot express any opinion on clause 8 (2.) (b) of the agreement.

The TEMPORARY CHAIRMAN:

– In reply to the question asked by Senator Mattner, it is perfectly obvious that honorable senators have been able to discuss this bill. We have been doing nothing else since about 10.30 p.m. As far as I can see, Senator Mattner is perfectly at liberty to discuss the provision he has mentioned.

Senator SCOTT:
Western Australia

– I should like to ask the Minister a question relating to paragraphs (b) and (d) of clause 8 (2.) of the agreement. I do not intend to canvass the matter at any length. Paragraph (b) covers the payment of £5 a ton in respect of Australian refined sugar cane used during the agreed period. It means that fruit processed for sale in Australia will attract a rebate of £5 a ton on its sugar content. Paragraph (d) covers the amount paid to processors of fruit which is exported. Apparently a rebate in excess of £5 a ton is paid to processors of fruit who take advantage of the export market. What is the sum that a processor could expect at the present time, under the terms of this present sugar agreement?

Senator MATTNER:
South Australia

– I consider that the question of the rebate is the crux of the matter. Senator Scott has asked what the rebate is at present when processed fruit is exported. There are two bites at this cherry - the rebate. If a man pays the price that is fixed by the

Fruit Industry Sugar Concession Committee, he gets a rebate of ?5 a ton on the sugar content of all the fruit he sells in Australia. If he exports his product and has paid the declared price, he receives a further rebate. If the difference between the price he pays and the price at which the sugar could be imported to Australia is, for instance, ?40 a ton, when he pays the price for his fruit he has already received a rebate of ?5 a ton on the sugar that has been used in his product.

Senator Scott:

– No, that is not right.

Senator MATTNER:

– Correct me if I am wrong. There is a total rebate of ?40 and he has already received ?5; so he receives only ?35 on what he exports. That is the crux of the question of what is to be done with the fruit industry.

Let me go back a step or two. The rebate of ?5 a ton works out at 10s. a ton of fresh fruit that the processor buys. On 100 dozen 29 oz. tins of processed fruit he receives a rebate of 10s. All that amounts to is one and one-fifth of a penny a dozen tins. No man is required to pay the price declared by the Fruit Industry Sugar Concession Committee in order to make his product that is exported. I will not go into all the details of that. He can pay any price he likes for his fruit. The only point is that he does not receive the benefit of the full difference between the world parity price and the Australian price; he receives all of that difference except ?5.

That is the crux of the whole matter, but it has not been discussed here tonight. I do not intend to discuss what should be done or what should not be done. All I say is that if the rebate is ?10 a ton it will work out at two and two-fifths of a penny a dozen tins of fruit.

Senator Armstrong:

– How much is that for one tin?

Senator MATTNER:

– I have worked it out at about one farthing a 29 oz. tin, but the honorable senator may work it out for himself. The rebate of ?5 a ton represents one and one-fifth of a penny a dozen tins. The important consideration, Mr. Temporary Chairman, is the export rebate. This is what the fruit-growers are concerned about: The Minister for Primary Industty (Mr. Adermann) has promised them that he will investigate this rebate and how it is applied. The domestic rebate and the export rebate are two entirely different matters. I do not want to discuss them to-night. When we consider these rebates, I believe that we should remember the points I have made.

Senator Scott has asked, a question about the fruit-growers having two bites at the cherry. I repeat that the price that is paid to the Australian fruit-growers for fruit for the export trade depends on whether a man will pay the declared price in order to get the ?5 a ton rebate but he need not pay the price declared by the Fruit Industry Sugar Concession Committee for the fruit that he processes and then exports.

Thursday, 10 May 1962

Senator WADE:
Minister for Health · Victoria · CP

– Mr. Temporary Chairman, I want to make one or two comments on the matters raised by Senator Mattner before I reply specifically to Senator Scott. I remind Senator Mattner that the sugar inquiry was a public inquiry and all interested parties were invited to state cases for their industries. That includes the growers, the processors and every other interested party. On no occasion did they raise the points that have been introduced into this debate by Senator Mattner.

If I understood the honorable senator correctly, he said that representations had been made to the Minister for Primary Industry (Mr. Adermann), who is prepared to give them some consideration. From my limited knowledge of this matter, I emphasize that the Minister gave no commitment concerning his future action in this matter for the very simple reason that the Government has always heeded the voice of the industry and not a section of it. It could well be that in this instance a section of the industry has had second thoughts on the rebates that we have been discussing to-day and believes that it may be able to improve its position by making representations to the Minister. All I have to say on that issue is that the Minister, in his usual courteous manner, received the deputation and he has given an undertaking to consider the matter; but he has left it there in respect of future commitments.

Senator Scott:

asked for the specific rebates that are available to the processors.

Fruit processors who pay the minimum price for fruit receive a rebate of £5 a ton on sugar used by them. That is the domestic rebate. If that processor exported products made from that fruit, this month he would receive a further rebate at the rate of £37 13s. a ton. The rebate is calculated from month to month and is based on the world market price of sugar.

Bill agreed to.

Bill reported without amendment; report adopted.

Third Reading

Motion (by Senator Wade) proposed -

That the bill be now read a third time.

Senator COLE (Tasmania - Leader of the

Australian Democratic Labour Party) [12.8 a.m.]. - Mr. President, I was rather disturbed this evening when I heard a statement by the Minister for Health (Senator Wade) in support of a point of order he had taken. I was disturbed because I always jealously safeguard the powers of the Senate, and the Minister gave the impression that they had been usurped by the Executive. He mentioned that the sugar agreement had been signed by the Queensland Premier, Mr. Nicklin and the Prime Minister (Mr. Menzies) on 9th April, that is, before we considered this bill. If that is correct, I cannot understand why we discussed this bill at all. I merely enter a protest at the powers of the Senate being usurped by the Executive which, according to a statement by the Minister to-night, has taken certain action.

Senator WADE:
Minister for Health · Victoria · CP

.- in reply - I challenge the logic of Senator Cole’s statement that I gave the impression that the powers of the Senate had been usurped by executive action. He went on to contend, if 1 heard correctly, that we were wasting our time discussing this bill at all, if his premise were correct. I hasten to assure him that if I gave that impression I had no intention of so doing.

My point was that this agreement had been settled and signed on 9th April, 1962. It is true that I said that the agreement was a signed and sealed document brought into this Parliament, and into this chamber, for either ratification or rejection. I emphasize that no one would challenge the right of the Senate to reject it. I did say that I believed a principle was involved. Here are two governments which have concluded an agreement. If the Queensland Government took it upon itself to vary that agreement without consulting the other party to the agreement, the greatest possible objection would be taken. If we altered the agreement without consultation with the other party, to wit, the Queensland Government, that would not be acting in good faith. The authority of this Senate was never challenged. Of course, it has a right to reject the bill. So long as we have a right to accept or reject, our functions are not usurped by executive action.

Question resolved in the affirmative.

Bill read a third time.

page 1254

ADJOURNMENT

Newspaper Report

Motion (by Senator Spooner) proposed-

That the Senate do now adjourn.

Senator BRANSON:
Western Australia

– I want the Senate’s indulgence for only two minutes to explain an interjection that I made during the speech of Senator Sir Neil O’Sullivan to-night. I based my interjection on a press report that I personally thought was wrong. I am sure that the Senate will agree with me. I cited figures which appeared in the “ West Australian “, in a report headed “ Export of Sugar Up On Wool “, and which read -

Melbourne Tuesday: Sugar formed a bigger percentage of Australia’s exports than wool, sugar company general manager Dr. J. Vernon said yesterday. He told the annual meeting of the Australian Industries Development Association that total sugar exports accounted for 15 per cent. of the gross national product. Wool accounted for only 7¼ per cent.

There is a categorical statement that those figures are in respect of Australian, not Queensland production. I do not know how many other newspapers cited those figures. The “ West Australian “, which is known for its accuracy in reporting, did so on page 14 of its issue of to-day’s date. I should hope that if the press is wrong it will correct this misleading statement, which could give a wrong impression to those members of the public who have, perhaps, been interested in the sugar agreement legislation that has been before the Senate.

Question resolved in the affirmative.

Senate adjourned at 12.14 a.m. (Thursday).

Cite as: Australia, Senate, Debates, 9 May 1962, viewed 22 October 2017, <http://historichansard.net/senate/1962/19620509_senate_24_s21/>.

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