30th Parliament · 1st Session
Mr SPEAKER (Rt Hon. B. M. Snedden, Q.C.) took the chair at 10.30 a.m., and read prayers.
– Petitions have been lodged for presentation as follows and copies will be referred to the appropriate Ministers:
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth-
That the three service cadet forces have great value in the development of the youth of Australia.
That the disbanding of the cadet forces will disperse accumulated expertise and interest of those involved, and in some cases negate the efforts of many people over many years.
Your petitioners therefore humbly pray that the Government will reconsider its decision and that the Government will reinstate the cadet forces.
And your petitioners as in duty bound will ever pray. by Mr Braithwaite, Mr Carige and Mr McVeigh.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of electors of the Division of Leichhardt respectfully showeth that both the School Cadets and the Naval, Army and Air Cadets provide character building and disciplinary training for the future citizens of this Commonwealth.
The Cadets also provide some basic team training for our youngsters which must be considered to be valuable in these times of vandalism and drug taking. The estimated cost of the Cadets is only a fraction of the cost to our community (i.e. the Australian community) from vandalism and drug problems.
Your petitioners therefore humbly pray that the government will immediately rescind its intention to disband the Cadets.
And your petitioners as in duty bound will ever pray. by Mr Thomson.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of undersigned citizens of Australia respectfully showeth-
That the existence of a system of double taxation of personal incomes whereby both the Australian Government and State Governments had the power to vary personal income taxes would mean that taxpayers who worked in more than one State in any year would-
Your petitioners therefore humbly pray that a system of double income tax on personal incomes be not reintroduced.
And your petitioners as in duty bound will ever pray. by Mr Armitage and Mr Morris.
To the Speaker and members of the House of Representatives in Parliament assembled: The petition of the undersigned of Australia respectfully showeth that many Australians are concerned at the presence of Indonesian regular and irregular troops in East Timor, in defiance of United Nations General Assembly and Security Council resolutions and at the apparent equivocal policy of the Australian Government, of publicly supporting self-determination for East Timor but privately reassuring Indonesia of its “understanding” and continued economic and military aid.
We your petitioners do therefore humbly pray that the Australian Government:
And your petitioners as in duty bound will ever pray. by Dr Cass and Mr Macphee.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled: The humble petition of the undersigned residents of the Australian Capital Territory showeth-
Your petitioners therefore humbly pray that the House urge the Government not to proceed with the introduction of self-government for the Australian Capital Territory until the residents of the Australian Capital Territory are consulted, by means of a referendum, on the issue.
And your petitioners as in duty bound will ever pray. by Mr Fry and Mr Haslem.
Omega Station in Australia
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned respectfully showeth:
Your Petitioners most humbly pray that the Australian Government will reject any proposal to build an Omega station on Australian soil.
And your petitioners as in duty bound will ever pray. by Mr Garrick and Mr Scholes.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble Petition of the undersigned citizens of Australia respectfully showeth:
Your petitioners believe that the potential area for dispute under a personal income tax system partially under the control of the Australian Government and partially under the control of the State Governments is quite wide. Examples of probable areas of dispute include:
Your petitioners therefore humbly pray that powers to vary income tax will not be given to State Governments.
And your petitioners as in duty bound will ever pray. by Dr Cass.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of the undersigned citizens of Australia respectfully showeth: That the undersigned persons believe that-
The $300 limit on income tax deductibility in respect of personal residential land and water rates is unrealistic and is a discriminatory income tax penalty.
Your petitioners therefore humbly pray that the Government will take steps to see that the aforesaid limitation is removed entirely or substantially increased.
And your petitioners as in duty bound will ever pray. by Mr Connolly.
To the Speaker and Members of the House of Representatives assembled. The petition of the undersigned citizens of Australia respectfully showeth that many Australians are concerned at the announced decision by the Australian Government to reduce 1975/76 Overseas Development Assistance vote by $2 1 million, and by the abolition of the Australian Development Assistance Agency.
We your petitioners do therefore humbly pray that the Australian Government:
And your petitioners as in duty bound will ever pray. byMrCrean.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The humble petition of certain citizens of Australia respectfully showeth that many of the countries who have benefited from Australia’s foreign aid programmes are now suffering even more because of economic problems, principally inflation. Some of these, the poorer nations of the world, are now having to deal with inflation rates of up to ten times, and more, that of Australia’s, on top of their age-old problems of overpopulation, famine and droughts.
We as concerned Christians, benefiting from the prosperity of our own wealthy nation of Australia, believe this nation has a moral responsibility to the poorer countries. At present our contribution to overseas development assistance is hardly adequate to meet the massive needs apparent in these countries.
Your Petitioners therefore humbly pray that Australia’s foreign aid budget be expanded to meet the growing needs of the world, and not reduced, in an attempt to solve Australia ‘s own economic problems. Regardless of any economic benefits that a policy of reduced spending may produce, overseas aid must be one area not to suffer from any general austerity campaign, Australia must not, in her isolated selfishness, penalise the poorer countries of the world as an easy way out of her own problems.
And your petitioners as in duty bound will ever pray. by Mr William McMahon.
To the Honourable the Speaker and Members of the House of Representatives in Parliament assembled. The petition of the undersigned citizens of Australia respectfully showeth-
That the plan to obliterate the traditional weights and measures of this country is causing and will cause widespread inconvenience, confusion, expense and distress.
That there is no certainty that any significant benefits or indeed any benefits at all will follow the use of the new weights and measures.
That the traditional weights and measures are eminently satisfactory.
Your petitioners therefore pray:
That the Metric Conversion Act be repealed, and that the Government take urgent steps to cause the traditional and familiar units to be restored to those areas where the greatest inconvenience and distress are occurring, that is to say, in meteorology, in road distances, in sport, in the building and allied trades, in the printing trade, and in retail trade.
And your petitioners as in duty bound will ever pray. by Mr Millar.
– My question is directed to the Treasurer. Is the crisis now occurring in Queensland building societies in any way due to the monetary policy of this Government and in particular to the issue of the special Australian Savings Bonds?
-The answer is no.
-Did the Prime Minister hold discussions yesterday with the Premier of Tasmania? Did the Premier raise the question of Tasmania’s shipping services being concentrated on only one port or the proposal to close 2 airports? Did the Premier express support for the views of the Leader of the Opposition on this matter?
-The Premier of Tasmania did come to see me yesterday about certain matters concerning his State. He did not raise these particular matters. I do not think that necessarily can be taken to imply any particular support for the views that had previously been expressed by the Leader of the Opposition when he was in Tasmania although I must say the Premier certainly in my presence did not dissent from the views that had been put by the Leader of the Opposition when he was in Tasmania. The Premier apparently thought that the views of the Leader of the Opposition were of so little consequence that it was not worth raising the subject.
– I ask the Treasurer: How soon will he be able to reassure investors in permanent building societies by action available to his Government, namely to proclaim the part of the Financial Corporations Act 1974 which covers the regulation and control of business and financial corporations, and make regulations specifying the asset ratios, lending policies and interest rates of permanent building societies?
– Irrelevant under these circumstances.
-Mr Speaker -
– Totally irrelevant.
– I welcome the interjection from the right honourable member for Lowe in respect of the questions asked by the honourable the caretaker or present or transient, or whatever the term might be, Leader of the Opposition. The facts of the matter are simply these: The Financial Corporations Act, which of course has now been enacted by this Parliament, was designed for purposes of overall economic management and not the financial stability of particular institutions. This, as the honourable gentleman ought well to understand, is clearly reflected in the provisions contained in the Act.
I might also add that most of the non-bank financial institutions are subject to supervision under State or Territory laws concerning the rights of borrowers and lenders and the financial stability of companies. I am informed, as the honourable gentleman would also have been informed when he was in government, that it is not and never was the intention that this Federal Act should exclude or limit the operation of State or Territory laws. So far as the operations of the Financial Corporations Act are concerned, I can inform the House and the honourable gentleman in particular that I will be meeting with the consultative committees established under that Act in Melbourne during the course of next week and in Sydney during the course of the following week.
-Is the Minister for Transport aware of the continual flooding problem in the Brisbane federal division? Does the Minister know that gravel in the beds of Ithaca, Enoggera and Breakfast Creeks and Kedron Brook has built up since 1967 after the Labor City Council ceased to remove same? Will the Minister initiate a survey of this gravel which it is believed and suggested would be suitable for the foundations of the proposed new Brisbane airport? Can the Minister give an undertaking that if the survey proves successful the Government will undertake to use the gravel from these creeks?
– I am aware of the problems of flooding in the area around the Brisbane Airport as described by the honourable member. He raises a somewhat interesting proposition. I assume that he holds the view that the removal of the gravel would not only mitigate flooding but also provide material necessary for the construction or reconstruction of the Brisbane aerodrome. The Queensland authorities have stopped any further removal of the gravel for their own reasons which have not been explained to me. Therefore the matter would need to be explored with those authorities. I would need to talk to my colleague, the Minister for Construction, about the suitability of the gravel for use in the development of the aerodrome because he is responsible for that area. I shall see that he makes investigations to ascertain whether the gravel can be used in such a fashion.
– I call the honourable member for Hunter.
– I think that my Leader wants to ask a question.
-The honourable member for Hunter has indicated to me that the Leader of the Opposition stood. It is the practice to call the Leader of the Opposition whenever he stands. I did not notice him stand. I now call the Leader of the Opposition.
-It could have waited, Mr Speaker.
– I wish to ask the Treasurer a further question about the Financial Corporations Act 1974. Does the honourable gentleman agree that that Act covers the operations of permanent building societies although not of terminating building societies? Does he agree that the part of the Act which deals with the regulation and control of such institutions has not yet been proclaimed? I also ask him: When will he receive a report from the advisory committee which he has appointed to deal with the affairs of permanent building societies?
– I thought I made it perfectly clear to the honourable gentleman that I will be meeting with all the consultative committees, which his Government quite rightly, properly and responsibly established to ensure that the Act would operate in the manner in which that Government intended. As I mentioned earlier in the House, those meetings will take place in Melbourne on Friday of next week and in Sydney on Friday of the following week. I simply repeat to the honourable gentleman, who seems to have a preoccupation with this question, what the right honourable member for Lowe said by way of interjection; that is, if the honourable gentleman is seeking to imply that this Act has some particular application to matters that were the subject of his question, that was not the intention of the Act. I suggest that after question time if he takes the opportunity to consult his former Treasurer he will find himself suitably edified on the matter.
-I direct to the Prime Minister a question concerning the matter raised by the honourable member for Franklin on Tuesday, namely, income tax. Has the Prime Minister had drawn to his attention the contents of a speech made on Monday by Mr Carnegie, the chairman of the Conzine Riotinto of Australia group of companies, in which Mr Carnegie very persuasively advocated the important need for substantial reductions in income tax on the incomes of skilled tradesmen and managerial and executive level employees? I ask the Prime Minister whether, in addition to the comforting news that there will be no increase in income tax, he can possibly hold out any reasonable hope for at least a substantial and close review leading to the possibility of reductions in income tax for these sections of the community, which more than any other section of the community contribute to increases in productivity.
– I did not see reports of the speech by Mr Carnegie, but I know his views well. He has expressed them on a number of occasions with some clarity and some force. I think he is drawing attention, as the question also is drawing attention, to a circumstance that has arisen from 3 years of the previous Administration in which the previous Prime Minister and his Government made quite rapacious demands that additional funds be taken from taxpayers and corporations all around Australia so that they could finance their own grandiose schemes of expenditure. It will not be possible to establish a sensible relationship between the funds required by governments and the funds to be left available to individuals and corporations unless governments limit the demands that they place upon national resources. It is our objective certainly to achieve that. As the honourable gentleman will know, one of the reasons why we have committed ourselves to the adoption of the Mathews Committee report- a commitment which has been supported by the Australian Council of Trade Unions but not by the Australian Labor Party -
– I raise a point of order, Mr Speaker. I wonder whether the Prime Minister would pay the House the courtesy of speaking into the microphone instead of playing to the gallery on the other side. I can hardly hear him.
– I think that the point made by the honourable member for Melbourne has merit. I did not enjoy the addition of the words which attributed motive to the Prime Minister. That was unnecessary. But the honourable member for Melbourne has drawn attention to the fact that it is difficult to hear the Prime Minister standing as he was then between 2 microphones.
-Mr Speaker, I understand that and I thank you for what you have said in relation to that. One of the problems resulting from the design of this House is that to speak directly into the microphone it is sometimes necessary to have one’s back directly to the person who has asked the question.
– Especially if he is in the Liberal Party.
– The Iraqis in the Labor Party are speaking. We well know that the Australian Labor Party believes the dollars that it spent from the national exchequer were wisely spent and that individuals ought not to have any funds available to themselves to spend on their own account. The Leader of the Opposition had on many occasions said that individuals ought to take funds, that the Government spends into account as part of their income. We happen to have a different philosophy, that a larger share of resources needs to be made available to individuals to be spent as they think fit, to determine their future as they believe appropriate and not as a few centralist politicians in Canberra determine for them. So the general thrust of the honourable member’s question is certainly something that we would want to achieve. We believe that the best way of achieving it is by the introduction of the Mathews proposals as early as our management of Australia’s finances will allow. That will be our objective and we will certainly give effect to it. One of the reasons, of course, why the Leader of the Opposition and those who sit sometimes behind him would oppose these proposals is that they would compel governments to be honest. If they wanted more funds from taxpayers they would then have to legislate to get them. The honourable gentleman would prefer to take them by surreptitious and improper means.
– I direct a question to you, Mr Speaker, concerning the facilities in Parliament House. I ask: Is consideration being given to providing an office in Parliament House for the wife of an honourable member? If so, what is the anticipated cost and why is this accommodation being provided?
– I have no knowledge of any such proposal. I will make inquiries- and I will see whether accommodation can be made available for entertainers like the honourable member. If the honourable member wants to make a point in the House I suggest he do so without adopting a cynical approach by asking a question in the tone of voice he affected.
– My question is addressed to the Minister for Defence. In view of the huge losses of sheep from blowfly strike that will occur in the aftermath of the disastrous floods in northwest New South Wales unless shearing teams can be immediately transported to this area, will the Minister reconsider making appropriate Service aircraft, such as helicopters and short take-off and landing aircraft which are presently operating in the area, available for this purpose. Does the Minister agree that it is equally as important to save sheep from blowfly strike as it is to save them from starvation and drowning? Is the Minister aware that such a move could save hundreds of thousands of sheep in the area affected? Will the Government now, by approving the use of such aircraft, complement the New South Wales Government’s support in covering 75 per cent of the cost of moving shearing teams by aircraft?
– I understand the honourable member’s concern. He may be assured that I will arrange for the matter to be reviewed, and reviewed sympathetically. I am bound to point out to the honourable member that my understanding is that there are numbers of commercial helicopters available and that they could be used. I am sure that my honourable friend will acknowledge the fact that the Royal Australian Air Force has in recent weeks played an outstanding role in bringing assistance to people in distress and in helping to save the lives of thousands of live-stock. I assure the honourable member that I will review the decision I have made and will do so sympathetically.
– I ask the Prime Minister a question. I refer to his reply to the last question he answered in which he indicated that it was the objective of the Government to increase the amount of disposable income over which individuals had command so that they themselves could make determinations as to where they spent that money. Among the first actions which he took when coming to office were those which increased to $2 the cost of a pharmaceutical benefit prescription; eliminated the $40 funeral allowance for pensioners; abolished the $2 per day subsidy for private hospital patients; reduced the amount of money available for people training under the National Employment
And Training scheme; significantly cut back the level of progress under the child care program -
– I rise to a point of order. Is this a question or a policy speech?
– I call the honourable member for Oxley
- Inter alia Secondly do these things really not increase costs which people have to bear? Thirdly, have these things been done without any reduction at all in income tax? Fourthly, does this not mean to any rational person who understands simple arithmetic that in real terms, therefore, many people will be worse off?
-Order! The honourable gentleman is making the question far too long. He is offering information in the guise of asking a question. He is complicating the question which will prevent the Prime Minister from making a short answer. He will have to make a long answer. I request the honourable gentleman to ask his question precisely.
– Are the people in the community who have to bear these increased costs by and large the people comparatively least able to bear them? How does the Prime Minister square these actions with the philosophy he is trying to sell to the public?
-The honourable gentleman’s mathematics are so good that he introduced a Budget and claimed that its deficit would be $2,800m. In spite of quite acute questioning he refused to indicate that the deficit was shifting sands under his feet and running towards $5,000m. So what can the honourable gentleman say about mathematics when his own are as bad as that? In introducing tax reforms, which he claimed would be of great advantage to many people, he took an extra $2,600m from the individual taxpayers of Australia, most of whom are of modest and moderate means.
The other sort of approach that the honourable gentleman mentioned was the changed attitude in relation to the NEAT proposal. I understand that there is to be discussion of a matter of public importance on this but I make one point. The honourable gentleman and the former Labor Government introduced a retraining scheme for which there was no means test. Somebody on $20,000 a year was equally entitled to retraining at the taxpayer’s expense and at the expense of trade unionists all around the country as was somebody who might have been unemployed and greatly in need of retraining. It is a tragedy that the retraining scheme introduced by our predecessors- and the impetus of that scheme has now been changed under the direction of the Minister for Employment and Industrial Relations- was very much motivated against the interests of the blue collar, the unskilled workers, the people most in need of retraining. A former Minister for Labor was well aware of that and knew of the necessity to change the impetus of the scheme.
– I rise on a point of order, Mr Speaker. I draw your attention to standing order 145. Whilst I appreciate your comment that questions to the Prime Minister should not be complicated -
– Will the honourable member make bis point of order?
– I feel that the offering from the Prime Minister is quite irrelevant to the question that was asked.
-There is no point of order. I take the opportunity to remind the honourable member that as the question was being asked I drew to the attention of the honourable member for Oxley the fact that the nature of the question inevitably invited a long and complicated answer. What the Prime Minister said is quite clearly relevant to the total economic aspects which were raised by the honourable gentleman in his question.
– The honourable member for Shortland, with nothing like the same ability, is aspiring to the mantle of the former member for East Sydney, Eddie Ward. He will need to practise much harder before he can obtain an equivalent reputation. I was just mentioning that under the proposals which we are pursuing we are trying to make sure that the NEAT proposals and the assistance available go to those in need and to those who are not able to get a job requiring skills equivalent to the skills which they have. Subject to correction by the Minister for Employment and Industrial Relations, I think only a couple of hundred people out of 25 000 people who had applied for or were undergoing training under NEAT are in the unskilled category. That is a condemnation of the arrangements which were introduced by the previous Administration and which were so ably supported by the former Treasurer.
Some other matters are subject to legislation. They will be debated in this House. The former Treasurer should not be one to speak of mathematics because they are his mathematics. It was his so called responsible Budget that has landed this country in such an economic difficulty. One must give some credit to the honourable gentleman for having been a most able confidence man at the time. He sold that Budget very well.
– I take a point of order.
– People are only now understanding what it means.
– That is a most unparliamentary remark for the Prime Minister to make. Mr Speaker, I ask you to ask him to withdraw that remark.
– I ask the Prime Minister to withdraw the remark.
– I quite happily withdraw it. The former Treasurer was very capable in selling that Budget. It is only now that people are understanding what it meant.
– My question is addressed to the Prime Minister. What is the attitude of the Victorian Government to the Commonwealth Government’s program of restoring integrity and authority to the States under the new federalism policy?
-The Victorian Premier has given the fullest and strongest support to the federalism proposals of the present Administration because he recognises that the States need to have a greater capacity to raise revenue on their own account and to be responsible for the funds that they raise and spend. There will be another Premiers Conference in relation to these matters on 9 April. The proposals that we are pursuing are designed to bring a greater degree of responsibility and autonomy to both States and local government where decisions that affect people in their own areas can be made by the people who know most about them and who live closest to them. It is for these reasons, among many others, quite apart from the proud and fine record of the Victorian Government, that I am quite certain that in the State election the Premier will have a resounding victory.
I find it quite impossible to believe that there will be a great deal of support for the Victorian Premier’s opponent in this contest because he is committed to supporting the policies of the Australian Labor Party. It was the present Leader of the Opposition who indicated not so long ago that much could be achieved by Labor members of State parliaments in effectuating Labor’s aims of gaining more effective powers for the national Parliament and for local government. The role of State Labor politicians is to bring about their own dissolution. That, I think, was originally said by the present Leader of the Opposition in a Chifley Memorial Lecture. I have no doubt he does not recant from that proposition, because all his actions in government seemed designed to compel that situation. It might also be worth noting in passing that the Labor leader in Victoria at one time started to advertise himself as the Victorian Labor leader, not as the leader of the Victorian Branch of the Australian Labor Party.
– I take a point of order.
-He was asking Federal members -
- Mr Speaker, again I seek your -
-Is the honourable member taking a point of order?
– Yes, under standing order 145. My point of order is in relation to the relevancy of the answer being given by the Prime Minister to the question which has been asked. I ask you to rule that the nature of the answer that he is giving is quite irrelevant.
-There is no point of order. The answer relevant.
-The last point I made, which I think was not heard adequately because of the point of order which was taken, was to the effect that the Leader of the Labor Party in Victoria is alleged to have sent a telegram, I think to Senator Brown, the Chairman of the Party, but maybe to the Leader of the Opposition- I am not sure whom- in these terms: Please keep out of the election; please keep quiet; you are destroying whatever thin hopes I ever had.
– I ask the AttorneyGeneral a question. Four weeks ago the honourable gentleman told the honourable member for Prospect that although he had not after the 1974 election made the return of electoral expenses which the Commonwealth Electoral Act requires- nor did I- he had put in the form for the 1975 election. Is it a fact that the Attorney declined to sign the return as printed and made a deletion in it before signing it? Why did he do so?
– It is correct that I put in a return. It is correct that I made a deletion. It was a deletion that I considered I was entitled to make and, indeed, any other honourable member is entitled to make under- I will not charge the honourable gentleman a fee for this- section 217 (i) of the Commonwealth Electoral Act, which provides:
As I have indicated I would regard other honourable members as being entitled to make the same deletion in terms of the Act.
– Is the Minister for National Resources and Minister for Overseas Trade aware of the concern which exists amongst the New South Wales councils of Bathurst, Orange, Lithgow, Young, Cootamundra and Wagga Wagga in regard to the delay in the commencement of the natural gas spur lines to serve those centres? Is the Minister aware that there are industries which have decentralised to those areas because of the promise made to supply them with natural gas? Is the Minister also aware that because of the commitments made the gas manufacturing plants and distribution systems used by some of the councils have not been updated? What action can the Minister take to ensure that the commitment to supply natural gas to the central west of New South Wales and Wagga Wagga is adhered to?
-The concept that the Australian Gas Light Co. had back in the early part of the 1970s was to provide the metropolitan area of Sydney, Wollongong and Newcastle, as well as a number of regional centres, with cheap, reliable supplies of natural gas. I am afraid that its ambitions were fraught with all sorts of hazards. The previous Government took over the pipeline developments of the Australian Gas Light Co. The project was delayed because of industrial troubles and floods. Not the least of the problems was the environmental inquiry which required the re-routing of the pipeline. That caused a delay which cost the Pipeline Authority, which took over on behalf of the Government, something like $90m extra. So all of that meant that today the attractiveness of the scheme is not what it was originally thought.
However, the haulage agreement between the Pipeline Authority and the Australian Gas Light Co. provided that to enable the Australian Gas Light Co. to supply these various towns with gas there was an obligation on the New South Wales Government to have the pipeline constructed by the Pipeline Authority to a receival point. However, when the Pipeline Authority gave notification to the Australian Gas Light Co. that it was ready to call tenders on the laterals, the New South Wales Government, at the request of AGL, deferred the development of these lines. That occurred in July last year. On 4 November 1975, 1 think it was, the Premier of New South Wales said that the company was ready to proceed with the laterals. However, until arrangements are made with the local government authorities no notification can be given to the Pipeline Authority to proceed. On 20 January this year I wrote to Mr Fruedenstein the Minister responsible in New South Wales for Australian Gas Light Co. matters, and asked when formal arrangements would be made with the various authorities which the honourable member mentioned. As yet I have had no reply from him. Until this is done, the Pipeline Authority is not in a position to call tenders.
-I direct my question to the Treasurer. I refer to answers given by him in relation to the entry into Australia of Pirelli International, cable manufacturers, against objections by Australian manufacturers. By way of background I ask: Did not an Australia company well known to the Treasurer invite Pirelli here in the 1972-73 period, when Treasury neither approved nor disapproved the proposal? With reference to the more recent unilateral approach for entry by Pirelli, does not the Treasury file disclose strong objections and clearly no unanimity amongst those consulted? As a result, did Treasury approve Pirelli’s entry into cable manufacture subject to the finding of a suitable Australian partner? As the Treasurer’s answers appear to indicate that Pirelli has not complied with this proviso, why cannot the Treasurer oblige the honourable member for La Trobe and withhold approval for Pirelli’s entry into Australia until an Australian partner has been found?
– I find the question somewhat curious. I do not quite know the intent or the reason for the honourable gentleman asking it of me, unless it is for some purpose which seeks to embarrass the procedures under which the decision was taken. That decision, as the honourable gentleman is very much aware, involved the honourable gentleman sitting opposite me who is the present caretaker Leader of the Opposition. I would have thought that the honourable member for Kingsford-Smith would understand, as a Minister in the former Government, that it is not the purpose of this Government to reveal what particular departments say on issues involving foreign investment, or on any other issues. I would have thought that the honourable gentleman would appreciate that these are matters for ministerial decision. He knows full well that that decision was taken by the Government of which he was a member, and taken with a proviso which that Government was not prepared to police at the time.
I suspect something from what the honourable gentleman invites me to tell this House. Whatever were the disabilities of the procedural process at that time and whatever were the problems associated with that decision, I remind honourable gentlemen opposite that it was their decision and not a decision taken by this Administration. I suspect, because of the clear inference in his question, that the honourable gentleman is casting grave aspersions on the decision-making processes of the Labor Party in government. I can well understand that. If this country has had one clear and simple lesson during the course of the last 3 years it is that the Labor Party has been unable to develop effective decision making procedures.
– It was a Whitlam decision.
– As the Prime Minister interjects, it was a Whitlam decision.
– No; I am talking about the Treasury decision.
– As I understand the situation, it was a decision taken by the then Minister Assisting the Treasurer. The honourable gentleman concerned is nodding assent. This matter is quite curious. I can only suggest that the honourable member for Kingsford-Smith is seeking to make some mischief on his own side. If he is seeking to make mischief among his own men, he is entitled to do so. That is simply par for the course in his Party.
– I ask the Treasurer: Does he remember that when the Financial Corporations Act- that was twice referred to by- whatever he is- the transient Leader of the Opposition, obviously without any knowledge of what was contained in it- was being discussed with the finance organisations of this country we pointed out to them- this happened probably 1 8 months ago- that under section 8 (4) of the Reserve Bank Act the Reserve Bank has power to lend money without qualification or restriction at its discretion? We then pointed out to the -
-Order! I ask the right honourable gentleman to ask his question.
– I have to give an explanation, Mr Speaker.
– I rise on a point of order, Mr Speaker. If I may take up the thread that you laid down before me, Mr Speaker, I think this question is getting long and complex and well beyond the capacity of the Minister to whom it is directed.
– We pointed out to the finance people and also to the permanent building societies that they had lender of last resort facilities.
– I rise on a point of order, Mr Speaker. The Standing Orders require that when a member is addressing a question to any of the Ministers he does not provide information. Right from the outset the right honourable member for Lowe has been breaching the Standing Orders.
-The Standing Orders allow an honourable member questioning a Minister to provide sufficient facts to found the basis of his question. The right honourable gentleman is at this stage providing facts in order to found his question. But enough facts have now been provided for the right honourable member to ask the question.
– Thank you, Sir. I am grateful to you for letting me know that and, I hope, all the people who are listening to the radio. Does the Minister remember that we advised the permanent building societies that they had lender of last resort facilities with the Reserve Bank? This was an enormous protection to them. Will the Minister now make the public -
– Order! The right honourable gentleman is out of order. I call the Leader of the Opposition.
-I ask a question of the Minister for Post -
Mr William McMahon- Mr Speaker, would you please tell me on what grounds that can be out of order when it is part and parcel of the question and would be of interest to this country? (Opposition members interjecting)
-Order! Members of the Opposition will cease interjecting and making a noise. I am responding to the request from the right honourable gentleman to inform him why he is out of order. I asked the right honourable gentleman to resume his seat because I had asked him to ask his question and to cease giving facts. The right honourable gentleman continued to give facts. As I had ruled that he must then ask his question I was obliged reluctantly to ask him to resume his seat.
– With respect, Mr Speaker, I was asking the Treasurer a question. I was not giving any more facts. I asked him whether he would make it known- obviously with the noise it was difficult to hear, but Hansard will confirm this- that the societies have these lender of last resort facilities as this would be of great benefit to the Australian community.
– I rise on a point of order, Mr Speaker. You had asked the right honourable member to resume his seat. Surely it is not the practice in this House to call -
– What is your point of order?
– My point of order is on the basis of consistency. Also, it is not the practice of the House, surely, to have one honourable member ask 2 questions consecutively.
-There is no point of order involved. I call the Leader of the Opposition.
– My succinct question without notice is addressed to the Minister for Post- that is how it is printed, the Minister for Post.
– It is not even good English.
-Exactly, it is like ‘grandwahz’. I ask the Minister for Post and Telecommunications: What decisions has the Government made on the financing and management of ethnic radio?
– The Government is presently giving consideration to its policy decisions. This will be a matter which will go to the Cabinet, I hope, in the next few days. A decision will be reached and then it will be announced.
– I call the right honourable member for Lowe.
– Thank you, Sir. I am grateful and I -
-Will the right honourable gentleman ask his question.
– Yes Sir. I only ask this of the Treasurer. Will he please let it be known not only to the permanent building societies but to the Australian people as a whole that the permanent building societies do have this right under section 8 (c) or (d) of the Reserve Bank Act and that it can be exercised with the discretion of the Reserve Bank authorities?
– The right honourable member for Lowe initially referred to an amendment which the Opposition at the time sought to make to the Financial Corporations Act. As I recall it- I speak very much from recollection- at the time that amendment was not carried. It was in fact designed to authorise the Reserve Bank to use the powers contained in section 8 of the Reserve Bank Act in respect of building societies. The right honourable member for Lowe is now indicating that he is not in agreement with that. But with regard to the particular point, I am informed that the Reserve Bank provides lender of last resort facilities only to the banks and to authorised short money market dealers. Such facilities are for smoothing temporary liquidity fluctuations and do not guarantee the solvency of these institutions. I am further informed that the provision of these facilities to banks and money market dealers stems from their special positions in the economy including the very detailed legislative or other close supervisions under which they operate and the special nature of their activities.
May I also say that there has been a number of questions raised today about matters which are relevant to particular issues in the State of Queensland. None of the questions has been relevant to asking what action the Government has taken or intends to take. I inform the House that a Press statement was issued by me immediately before Question Time and it will be available to honourable gentlemen as soon as the question period is over.
– Will the Treasurer table the paper from which he read?
– I rise on a point of order, Mr Speaker.
-The honourable member for Shortland will resume his seat. Is the honourable member for Corio making a request for the tabling of the paper?
– I intended to ask that the paper be tabled.
-The Treasurer will be required to table the paper if he read from it and if, having read from it, it is not a confidential document. Did the honourable gentleman read from it?
– I rise on a point of order, Mr Speaker. I hesitate -
– I remind the right honourable member for Lowe that I am dealing with a point of order now. Did the Treasurer read from the document?
– I quoted -
– We all saw him.
-The honourable member for Chifley will remain silent. I remind the Treasurer that he will be called upon to table the document if he both read from it and it is not a confidential document. I therefore ask him the first of the 2 points: Did he read from it?
-The answer is that I read from the document in part, Mr Speaker. The answer to your second question, Mr Speaker, if it is your intention that I should go on, is that the document is clearly labelled ‘confidential’.
-I ask the Prime Minister: In view of confusion which quite obviously exists in a lot of people’s minds, could he inform the House whether the guidelines so far established and discussed on a separate State income tax will allow expansion of a State’s taxes without any reference to other States or to the overall tax burden which will be applied to the general community? I remind the Prime Minister that a lot of people are concerned about this particular area, especially the levels of State taxes which will become possible in individual States.
– I shall arrange for the honourable gentleman to be sent a copy of the policy statement, which is detailed and precise and clear.
-Is the Minister for Post and Telecommunications aware that the Australian Postal Commission has increased private mail bag fees for country mail services throughout Australia to $30 a bag? Was this service fee increased to $15 last year and was it previously $4? Are many country people cancelling their private mail bag services owing to this exorbitant and iniquitous increased fee? Will the Minister investigate the charge with a view to having it reduced to a reasonable level?
-I am aware of the increase in the charge. I am also aware that any increase in the charges of the Australian Postal Commission or the Australian Telecommunications Commission has an impact, and sometimes a very unfortunate impact, upon the community or sections of it. I have said time and time again that these commissions are largely independent. We do not interfere with their day to day management. We have an overall responsibility with regard to the basic tariffs. I will discuss with the Commission concerned the matters raised by the honourable member.
-I address my question to the Minister for National Resources. I preface it by referring him to the delayed judgment of the High Court on the Seas and Submerged Lands Act. I ask him to give the earliest possible publicity that he can to any advisings he may have received upon the operation of that judgment, based as it is upon the exclusive- I stress the word ‘exclusive’- off-shore sovereignty of the Commonwealth of Australia from the low water mark under the external affairs power. I ask in particular that in any information that is made available he include reference to the following matters: Firstly, the lack of constitutional authority for State designated authorities; secondly, the validity of exploration permits and leases granted by them to date; thirdly, the extraterritorial operation of State laws; and fourthly, the prior and future collection of royalties from present off-shore petroleum producers.
– I think everybody is well aware of the honourable member’s obsession to have complete dominance over the mining industry as a whole, not only off-shore but also on continental Australia. However, on the Government’s side of the House we recognise that within the States an enormous amount of expertise and administrative ability has been built up over many years to give a judgment on permits and other matters relating to exploration and development of mineral resources. Although there has been a High Court decision giving sovereignty to the Commonwealth in off-shore areas, it is our desire to co-operate with the States to see that the maximum use is made of their facilities rather than to build up another Commonwealth instrumentality in this area.
– Will you or will you not table the advisings We are entitled to them.
-There will be discussions between the legal bodies, the Attorneys-General, on this matter. There will be discussions between State and Commonwealth ministers relating to the future administration of these areas. I make it quite clear that ultimate ministerial responsibility lies in this Parliament and therefore it is necessary that there be continuing consultation and discussion with the Commonwealth in whatever developments there are or whatever leases are given in off-shore areas.
– My question is directed to the Attorney-General. Has the Government been conducting inquiries into alleged kick-backs of commission in relation to overseas loan dealings? Can the Attorney-General give the House any information as to the result of those inquiries?
– Last year and early this year the Premier of Queensland, Mr Bjelke-Petersen, supplied to the Federal Government certain information which suggested that 2 Ministers of the Labor Government and a senior official still in the Commonwealth Public Service might have been involved in attempts to obtain for themselves kick-back commissions on proposed overseas loan borrowings by the Labor Government. The information included notarised statements and other documents which pointed to the possible existence overseas of a mandate signed by the Ministers and of an associated document implicating the official, which mandate and associated document evidenced the attempts to obtain the kick-backs.
The information was discussed with the Solicitor-General, the Secretary of the Attorney-General’s Department, the Permanent Head of the official’s Department and the Chairman of the Public Service Board. With their concurrence it was decided that in view of the fact that the information implicated a senior public servant the Government was bound to institute inquiries to ascertain whether there was any substance in it. Thorough inquiries have since taken place overseas. As a result of these inquiries the Government is completely satisfied that there is no substance in the suggestion that either the official or the 2 Ministers were involved in the wrongful conduct alleged.
-My question is directed to the Attorney-General. Has the honourable gentleman seen reports of the very serious differences in the views of the Commissioner of Corporate Affairs in Victoria and the Corporate Affairs Commission in New South Wales on tax effect accounting for losses? Is this another example of the absurd variations in the States’ company laws and their administration which bedevil the Australian business community? Will he have discussions with officers of his Department about the ways in which the constitutional powers of this Parliament relating to corporations can be used to establish standard accounting procedures throughout Australia so as to restore the confidence of investors for which the Government constantly professes such concern?
– I shall answer the question. The remarks of the Commissioner of Corporate Affairs in Victoria were directed to a more particular aspect of corporate law and also the operation of taxation legislation. The broader question that the honourable gentleman raises that is the uniformity of corporate law and regulation throughout Australia, is under very active consideration by my Department and at appropriate stages it is consulting with the Attorney-General’s Department. I hope that it will be possible for the Government to give an indication of its attitude at a very early stage. I do not want to say anything further other than that I am in consultation with the various State Ministers responsible and in due course I hope to be in a position soon to make specific recommendations to the Government.
– I address my question to the Prime Minister. During the visit yesterday of the Tasmanian Premier to Canberra was the northwest regional water scheme discussed? Did the Premier give any indication as to whether his Government had used its influence to induce certain municipalities to join the scheme? What action does the Commonwealth intend to follow in this matter?
-There are a number of matters and disabilities affecting Tasmania which are of real concern to this Government. Not least of those disabilities are the problems of freights which I know are under active examination by the Minister for Transport. Yesterday the Tasmanian Premier did raise the north-west water supply scheme issue and wished to know the Commonwealth’s present attitude. The previous Government had undertaken a commitment in relation to this matter when the estimated cost was regarded as being about $10m. On the estimates available to me that cost has virtually doubled in the period since then.
The Tasmanian Premier told me that he wished to have the Commonwealth’s attitude clarified because he wanted to introduce legislation into the Tasmanian Parliament which would have compelled participation in the scheme by all the municipalities involved. I am afraid that I had to make it plain that I was not particularly enthusiastic about the compulsion involved in that approach because I had been advised, and I am assured that this information is correct, that the two most populous municipalities, Devonport and Burnie, have no wish to be part of the scheme. It would therefore seem unreasonable to introduce State legislation to compel that situation and it would not be reasonable for the Commonwealth to be a party to that kind of compulsion. Other matters were also discussed in relation to this particular proposal concerning the budgetary position in which the Commonwealth finds itself at the moment. The element of compulsion to which I have referred is not something which we would want to force upon municipalities in Tasmania or in other regions.
– I inform the House that the President of the Senate and I have decided that the Press gallery accreditation of Mr Maurice Wilmott should be withdrawn for a period of 2 weeks, commencing forthwith. We have concluded that Mr Wilmott has breached that part of the rules of the Parliamentary Press Gallery which states:
Photographers and TV cameramen may take pictures or film on invitation in private rooms.
This matter arose out of a complaint made by the Leader of the Opposition (Mr E. G. Whitlam), in a letter to me dated 26 February last. The complaint referred to the publication of a photograph in the newspapers Australian and Sydney Daily Telegraph on that day. The complaint raised 2 issues: Firstly, the taking of the photograph in his room against the expressed wishes of the Leader of the Opposition and, secondly, the treatment given to the photograph published in the Daily Telegraph. I table that letter.
On 2 March I wrote to the editor of the Australian and the editor of the Daily Telegraph and enclosed a copy of the letter from the Leader of the Opposition and asked that I be provided with an explanation. By letter of the same date addressed to the President of the Federal Parliamentary Press Gallery I asked for any information about the matter which could be provided, and enclosed a copy of the letter of the Leader of the Opposition. I table each of those letters. I received a reply from the deputy editor of the Australian dated 9 March which contained an apology. I table that letter. I have received a letter dated 9 March from the editor of the Daily Telegraph which contains an explanation of the treatment of the photograph as published and an apology. I table that letter. I received a letter dated 15 March from the President of the Federal Parliamentary Press Gallery which informs me of the consideration and conclusions on the matter by the Gallery Committee. I table that letter.
Mr President and I concluded that there was a breach of the rules by Mr Wilmott. He had a personal obligation as a member of the Press gallery to comply with the rules. He failed to do so. We regret having to suspend any Press gallery accreditation but in the interests of the proper working of our parliamentary system we must insist now and in the future that the rules of conduct in this building are strictly upheld. I table this statement.
– I was asked a question by the honourable member for Hunter (Mr James) about a request to refurnish a room for the wife of an honourable member. I know nothing about that but I have checked my recollection. Inquiries are being made, and I think that they have almost come to a conclusion, into a proposal that a room should be set aside which would be a place of rest and comfort for the wife of any honourable member. I would like that to be known. The matter was initiated by my predecessor, the honourable member for Corio (Mr Scholes), and by Mr President Justin O ‘Byrne. I take the opportunity to make that point. I will proceed with an examination of the question asked by the honourable member for Hunter.
– I move:
- Mr Speaker, I take a point of order. I query the propriety of this motion in that it requests this Parliament to take action concerning the sitting of the Parliament of a sovereign State. As this Parliament is constituted under the Australian Constitution and as the Parliaments of the several States are separately identified within the terms and conditions of the laws of those States, I submit that this motion is totally out of order.
– I ask the Leader of the Opposition to give me the motion in writing.
– On a point of order, Mr Speaker; if the point of order were upheld, the rights of the this Parliament to discuss any decision of a sovereign State parliament would be impinged upon. I think that that would be a restriction on this Parliament which could not be entertained even on a ruling of the Chair.
-We spent half of question time talking about the Victorian election.
– I ask for silence from the honourable member for Port Adelaide. Whatever I may think of the motion, I cannot rule it out of order. It is a matter for the House to decide the way in which it should be treated. The Leader of the Opposition is moving for the suspension of Standing Orders in those terms.
– Honourable members will recall that during the election campaign in December last the Premier of Queensland called together the Legislative Assembly of Queensland for a special session and there made charges against 2 Ministers in my Government and a senior Australian Government public servant. The Attorney - General (Mr Ellicott) has succinctly referred to the nature of those charges against the 2 Ministers- the Attorney-General did not name them, nor did the Premier name them- and also against the head of a Government department, he also not being named today or in the Queensland Parliament. The Premier made these aspersions under parliamentary privilege. That presumably was the reason for calling together the Legislative Assembly of Queensland so these charges could be made with the protection which Parliament affords. The Premier was astute not to specify the Ministers, the departmental head or the departments or department concerned.
– I take a point of order, Mr Speaker. The Leader of the Opposition should be debating the motion for the suspension of Standing Orders rather than the substance of the motion. I suggest that he direct his remarks towards the reasons for the suspension of Standing Orders rather than towards the substance of the motion itself.
– I am sure that the Leader of the Opposition understands that standing order. He is perilously close to being out of order.
– I ask for the suspension of Standing Orders to deal with this matter promptly. The Attorney-General was asked a question on this matter without notice. He gave a reply which he had obviously carefully and properly considered. It was a succinct and factual reply. I believe that all honourable members will appreciate the tenor of his reply. But that reply having been given, I put it to honourable members on both sides that we should deal with this matter promptly. It is true that these allegations, now shown to have been false, were made against Ministers of mine and against the head of a department administered by one of my Ministers. It may therefore be thought in a partisan sense that this is a matter which concerns the Opposition alone. The Opposition obviously does not have the numbers to carry any motion in the House. People may therefore be impatient at the matter being raised, and still more at it being debated. Nevertheless, this sort of thing can happen at any time. It can happen in any House of parliament in Australia. It can happen at the instance of a member of any Opposition in Australia. Constantly charges are made against public figures.
I remember that an immense number of allegations were made- I do not think any importing such criminality as this- during the last 3 years about members of this Parliament and specifically about my Ministers, about me and about my wife. Those allegations were made in State parliaments and they were not made only by Premiers or Ministers; sometimes they were made by members of Oppositions and sometimes they were made in Upper Houses as well as in Lower Houses. So, after an event such as this, forgetting the fact that it was an election time, and on a matter such as this it is important to all members of this Parliament, on whichever side they sit and in whichever House they sit, that we should deter, that we should identify and deter such allegations made against members of the Parliament and that we should not mince matters in expressing our views about them when they are found to be false.
The matter is no different in kind- it may be different in degree because it took place during an election campaign- and at a special session of a State parliament called during a Federal election campaign, but I put it to honourable members that this can happen about anybody who is a member of parliament. I apprehend that we would not cover up for any Federal member of parliament who tabled a statutory declaration against a State member of parliament if that statutory declaration was later found to be without basis. That is the simplest and I suppose not infrequent instance. A statutory declaration can be tabled in this Parliament. It might not have protection in that case. But it could be incorporated in Hansard or it could be read and thus, of course, recorded in Hansard and have protection. If a statutory declaration is used by a member of this House against a member of the Senate or against a member of any State House of Parliament and that declaration is found to be without basis or is shown to be false, then we should not cover up in expressing our views about any of our colleagues or our opponents in this chamber who used it.
In this case it will be recalled that the Premier of Queensland called a special session. The session was held during a Federal election campaign. The Premier had sent police overseas to get these notarised statements. It may be that the motion to suspend the Standing Orders will not be carried, but at least I put this to the Attorney and I think that professionally he would see the justice of it: Will he table the notarised documents to which he has referred so that honourable members can ascertain the name of the person who swore this false declaration and so that they can see the nature of the allegations that were made? I also ask him whether these documents- I forget his precise words- which show that false allegations were made disclose any false swearing under a Federal law and in that case whether he is considering any action for breach of that law.
-Is the motion seconded?
– I second the motion. I think that the motion should be carried unanimously by this House. I think that the suspension of the Standing Orders is a matter of the most extreme urgency. This is not a question of party politics. It is a question of risk to the parliamentary system which should be dealt with forthwith and very strongly by this Parliament. It is within the compass of any parliament in the Commonwealth to be called together for a special session to deal with or to hear matter which could be extraordinarily damaging to members of another parliament, especially during an election period. I say with respect that it would be possible for a State parliament or this Parliament to be called together, although I believe that this Parliament’s integrity is such that it would not happen, or for a House of a parliament to be called together to entertain a statement which had no basis in fact against a leader of a party or a member of a party in order to affect the result of an election in another State or for another Parliament.
The urgency of the matter is that I believe it should be dealt with by this House immediately and unquestionably it should be the expression of this House to condemn the making of false charges during an election period.
-Order! The honourable gentleman is now debating the matter.
– I am expressing why I believe the Standing Orders should be suspended so that this matter can be dealt with without delay. It is a matter of extreme urgency. Privilege is designed to protect members of parliament in the legitimate pursuit of their duties. I do not consider it a legitimate pursuit of the duties of members of parliament to lay false charges in order to affect the result of an election. I hasten to say that I do not think the charges made by the Premier of Queensland did alter the result of the election. I want that made quite clear. But the fact is that far more substantive charges or charges of a different nature could be made against a member.
I use a hypothetical case in order to illustrate that, with your indulgence, Mr Speaker. It is quite possible that charges of a personal nature could be made. It could be said that a solicitor who was a candidate or a leader of a party had shortages in or had misappropriated his trust funds. Any such charge could be made on the floor of a State parliament during debate and would not have to be substantiated. It would then be carried immediately by the Press and certainly would have an influence on the result of an election that might be held 2 days later. It is urgent and important that this House should express its contempt for such actions or the use of parliaments in that manner. I ask the House to carry the motion for the suspension of the Standing Orders and then to carry the motion which would follow, because if this House does not express its contempt for that type of action it is concurring in that type of action by default and allowing itself to be open to such actions in the future.
– I wish to oppose the motion for the suspension of the Standing Orders.
– What are you trying to cover up?
-I think it must be apparent, as the Leader of the Opposition (Mr E. G. Whitlam) said, from the carefully worded statement that I gave this morning that there has been no attempt to cover up in this matter. The honourable gentleman, the Leader of the Opposition nods and I think he agrees. Therefore, that interjection was quite uncalled for. There is a confusion in the arguments that have been put in support of the motion to suspend the Standing Orders. The fact that inquiries have been made and it has been concluded that there is no foundation for the allegations does not mean that the information that was produced itself would not justify some statement about it or some action in relation to it.
Clearly enough, as I said in the statement, the Premier of Queensland did produce some information and, as I also said in the statement, it included a notarised document and an associated document. The Leader of the Opposition asked me whether I will table them. I do not propose to table them, for what I think is a very proper reason. That is the one that I have expressed here before. I do not believe that allegations about people which may be or could be unfounded should be made, and certainly they should not be made by a law officer in relation to information which he receives from people who give him information. The function of the law officer could not go on if that were so. That cannot be done either in the interests of the administration of justice or, alternatively, in the interests of justice to the individuals against whom allegations may be made. Quite apart from that, because that principle is a very important one and does, I believe, apply here, it is equally not open to honourable members to debate the question whether the Premier was justified in saying what he did. Clearly enough, the Commonwealth, after discussing this matter with the secretary of the Attorney-General’s Department, the SolicitorGeneral, the head of the official’s Department and the Chairman of the Public Service Board, concluded that on the basis of the information supplied there had to be some investigation, and that investigation took place. Therefore, there is no basis upon which it could be said that the Premier of Queensland can be condemned for doing what he did.
– What about the Premier calling the Queensland Parliament together?
– The Parliament of Queensland is his forum and he made statements there. He did not name anybody and, from recollection those allegations were immediately refuted in the Press by members of the Opposition and I think by the Leader of the Opposition. They were quickly and immediately refuted and the matter has been answered publicly. The fact is, of course, that allegations are often made both inside this House and outside this House about the conduct of honourable members. I have had them made against me and they have made against other honourable members. Members may firmly believe that those allegations are unjustified. But I do not notice anybody suddenly jumping up and seeking the suspension of Standing Orders because an allegation has been made against a member. Those allegations are made and they are usually answered in another way. Furthermore, the statement that I have made is a complete exoneration of the people involved. Therefore, there is absolutely no point in a debate on this matter.
-I ask whether the notarised document disclosed any breach of Federal law- the fact that it was false.
– It is typical of the lying statements by Petersen.
-Order! The honourable member for Newcastle will remain silent.
– The Leader of the Opposition asks me whether the notarised statement disclosed any breach of Federal law. I can answer him only by saying that if those facts were shown to be true and if certain other, perhaps more incidental, facts were proved and added there could be some breach of, I think, the Secret Commissions Act. I do not want to go into that at this stage but I can tell honourable members that it could have led to a criminal charge. Before that there was a serious question involved in the allegation against the senior official, quite apart from the question of criminal conduct, which therefore justified those proceedings.
– May I ask the AttorneyGeneral a question? I do not want to be unsporting in any way.
– Well, you have me in the box.
– What I really want to ask is whether the fact that the notarised document was shown to be false discloses an offence against any Federal law.
– No. The falsity of that would not disclose any offence against a law of the Commonwealth. Mr Speaker, we oppose the suspension of Standing Orders.
– Mr Speaker, I -
Motion (by Mr Sinclair) proposed:
That the question be now put.
The House divided (Mr Speaker-Rt Hon. B. M. Snedden)
Question so resolved in the affirmative. Question put:
That the motion (Mr E. C. Whitlam’s) be agreed to.
The House divided. (Mr Speaker-Rt Hon. B. M. Snedden)
Question so resolved in the negative.
-Pursuant to section 5 of the Dairy Adjustment Act 1974 1 present an amending agreement in relation to dairy adjustment programs in New South Wales.
Pursuant to section 58 of the Stevedoring Industry Act 1956-1973 1 present the annual report of the Australian Stevedoring Industry Authority for the year ended 30 June 1975 together with financial statements and the report of the AuditorGeneral on those statements.
– Pursuant to section 32 of the Homes Savings Grant Act 1964-1975 I present the annual report on the administration of that Act for the year ended 30 June 1975.
– Pursuant to section 8 of the Urban and Regional Development (Financial Assistance) Act 1974-1975 I present 15 agreements made under the provisions of that Act relating to New South Wales, Victoria, Queensland, South Australia and Tasmania.
Motion (by Mr Sinclair) proposed:
That the House take note of the papers.
Debate (on motion by Mr Scholes) adjourned.
-Mr Speaker, I wish to make a personal explanation.
-Does the honourable member claim to have been misrepresented?
– I do. As reported at page 664 of Hansard the honourable member for Newcastle (Mr Charles Jones) said that I was a senior partner in a business in which $2m of people’s money went astray. That is totally false. I am not and have never been an owner or part owner of any business in which the money of any people has gone astray. If the honourable member was referring to Patrick Partners, I indicate that I am not and have never been an owner or part owner of that business. I was, as has been frequently reported in the Press, a staff partner employed on a salary and having a fractional profit share.
– What is the difference?
– What about the shareholders?
-Order! The honourable member for Macarthur will resume his seat. Earlier today the House had before it a motion for the suspension of standing orders so that the House could consider a debate which took place in the Queensland Parliament. The basis of the motion for the suspension of standing orders was allegations made against Ministers and public servants. The Opposition regarded it as being very important to make the position clear. The honourable member for Macarthur is making it clear that he wants to make a personal explanation dealing with such a matter. He should be heard in silence.
– I take a point of order. The honourable member claims that he was misrepresented as being a partner. In the further submissions he is making he indicates that he was a salaried partner. My submission is that there has been no misrepresentation in the fact that he was deemed to be a partner. In fact he was registered as a partner.
-There is no substance to the point of order; it is a point of argument. I do not propose to respond to that particular statement although there might be a ready response to it. The honourable member for Macarthur claims that he was misrepresented by being described as a senior partner. He now is saying that he was not a senior partner but a salaried partner. He quite clearly made the point that he was not an owner or part-owner. I think the honourable member for Macarthur should be permitted to continue with his statement.
-Thank you, Mr Speaker. Any imputations about ownership or control, such as that made by the honourable member for Newcastle, are totally- and I submit maliciouslyfalse. (Opposition members interjecting)-
-The House will come to order. I remind honourable members that the honourable member for Macarthur has complained about being misrepresented. That was done formally and it now appears in Hansard. I have heard interjections from my left which basically repeated that misrepresentation. They will not appear in Hansard, I am pleased to say, otherwise the honourable member would find himself continuing to make his personal explanation. Now that he has made his personal explanation it ought to be accepted. I hope that it will be.
– I have received a letter from the honourable member for Gellibrand (Mr Willis) proposing that a definite matter of public importance be submitted to the House for discussion, namely:
The action of the Government in substantially altering allowances payable to trainees under the National Employment and Training Scheme.
I call upon those members who approve of the proposed discussion to rise in their places. (More than the number of members required by the Standing Orders having risen in their places)
-The Opposition brings this matter before the Parliament because it is concerned at the great injustice the Government is about to wreak on thousands of persons training under the National Employment and Training Scheme, and at the substantial reduction in the effectiveness of that scheme that will flow from the Government’s action. The action that involves these highly undesirable consequences is the proposal to revise the allowances for NEAT trainees as announced by the Minister for Employment and Industrial Relations (Mr Street) on 1 1 February. The Government proposes to scrap the standard rate of allowance for all adult full time trainees, which is currently $96.80, and replace it with an allowance that varies according to the number of the trainee’s dependents.
The new allowances comprise a basic allowance equal to the rate of unemployment benefit for such a person, or whatever other benefit he or she qualifies for, plus a training component of $23.40 which is calculated on the basis of 20 per cent of the average male award rate. These new rates have already been introduced for trainees who started after 11 February and are to be introduced on 1 April for trainees already in training at that date.
The effect of their introduction will be that many trainees will have their allowances reduced. Some of them will lose them altogether. Many will drop by $73.40 a week and many more will suffer lesser reductions. On the other hand some trainees will receive more than is currently provided but the proof that their number is not large is clearly shown by the statement by the Minister that the new arrangements will enable an extra 3000 persons to be trained for the same total outlay as before. However, this claim is no more than a calculation of what is mathematically possible by reducing the allowance for many trainees and is highly unlikely to be borne out by future events. At this stage I seek leave to incorporate in Hansard a table showing the effect of proposed new allowances for various categories of NEAT trainees.
-Is leave granted? There being no objection, leave is granted. ( The table read as follows)-
-I thank the House. The table shows for various categories of trainees the difference which the new arrangements will make to their allowance. I draw particular attention to that category of trainee whose spouse earns between $70.50 and $238.20 a week. For such trainees, who will be mainly married women, the allowance now becomes $23.40. Such an allowance would barely cover the cost of child care at a commercial child care centre in a capital city. Therefore we see that for those people there is no incentive to undertake training in the future.
It is important to realise that the table does not show all the picture. Not only have the allowances been altered but also an income test has been imposed. No such test existed under the previous arrangements. This income test is very severe. Indeed, it is the same as that which applies to unemployment benefit. It allows additional income of $6 per week but thereafter the allowance is reduced by $1 for each $1 of additional income. The combined effect of the reduced allowances and the strict limit on additional income will have a devastating effect on some trainees. In one case raised with me, which would not be an isolated case by any means, a widow with a couple of dependent children receives $96.80 in allowance and earns $30 per week for part-time work. Now, however, her allowance will be reduced to $81.15 and for every $1 she earns over $6 in part-time work her allowance will be reduced by $ 1 .
– In that case it is $20. It relates to a widow.
-I see. In that case it is $20. If she continued to earn additional income of $30 per week her allowance would be reduced and she would be no better off than she is currently. Furthermore, it also has been made impossible for her to retain her previous income level by increased part-time work and she would be no better off than if she earned only $20 in additional income. That part of her allowance which is the designated training component, $23.40, is not subject to the income test but it still means that to restore her financial position to what it was previously she would need to earn approximately $100 a week in additional income. However, to earn that much additional income she almost certainly would require full time work or at least far more work time than would be possible if she were doing a full time retraining course and trying to raise 2 children single-handed.
How ironic it is that this traumatic situation is imposed on her by a Government that claims to support individual initiative. She is left with the option of accepting a permanently reduced standard of living for the duration of her training or chucking it in and getting a full time job. Clearly many people in this kind of situation will take the latter course and every time that this happens the training and the resources expended on that training, in many cases amounting to several thousand dollars, will have been wasted.
Another example that would not be uncommon is that of an unemployed man with a wife and 2 children. He commenced a NEAT course on $96.80 and his wife worked part time for $80 a week. Their combined income was thus $176.80 and they entered into various commitments on the basis that they would earn this level of income while his training continued. But now the man’s allowance will fall by $73.40 to $23.40 a week and the family income will be reduced accordingly to $103.40. Again there certainly will be great financial pressure on such a person to abandon his course and accordingly waste the resources spent on his training.
Subsequent speakers on this side in this debate will refer to various colleges and institutions where many trainees have been affected in a similar fashion to those I have described already. All these examples raise a very pertinent point in this debate and that is the obligation of the Government to trainees who went into the scheme on the promise that they would be paid $96.80 and made their commitments accordingly. We of the Opposition strongly contend that the Government does have an obligation to these trainees. It may even be that in some cases a legal obligation exists on the Australian Government to meet its part of the contract. I understand that this possibility is receiving careful consideration in some quarters. Whether or not there is a legal obligation, there can be no doubt that there is a moral obligation on the Government at least to maintain the previous rate of allowance. It is no excuse simply to assert, as the Minister did, that the coalition policy before the last election was to introduce a means test on NEAT and that it is now simply carrying out that policy. Where and when did the coalition parties say before the election that they would change the form of NEAT allowances? It certainly was not in the employment and industrial relations policy as published before the election, though that document had much to say about the desirability of training schemes; nor was it in the election speech of the Prime Minister (Mr Malcolm Fraser). But, even if a policy commitment was made before the election, it certainly was not made in terms that suggested that many trainees would lose a large part of their allowance. Even if there had been such a frank disclosure of intention, we still say that the Government had an obligation to keep faith with those people. The fact is that new governments always inherit a variety of commitments which may not be legally binding but which have been entered into in good faith, and an honourable government would meet these commitments. This Government, by reneging on its obligations to existing NEAT trainees and by its cynical breach of faith with the several thousand people involved, is acting in a thoroughly dishonourable fashion. Yet this is the Government that boasted at the last election that it would bring integrity and honour back into government. What a hollow sham that claim is now shown to be
In view of all that I have put to this point, it is rather remarkable to note that, according to the Minister, the purpose of revising the allowances was to put them on a more equitable basis and to enable more persons to be trained for the same total cost. In our view, the first of these objectives is completely misconceived and the second not only will not be achieved but the result will be quite the opposite of that which is intended. To take this latter point first, from what I have demonstrated already it is certain that many trainees will have to give up their courses. Furthermore, the scheme will be much less attractive to most prospective applicants. How then will more people be trained with these new allowances? The result almost certainly will be that far fewer persons will be trained than was the case before. Indeed, when one examines what the new allowances will entail one wonders whether the Government’s intention is not, after all, to reduce expenditure on NEAT but to do it in an underhand way. But, whether this is the case or not, if the intention of the introduction of the new allowances is to train more people, they will totally fail to meet that objective.
The other stipulated reason for the new procedures- that is, to make the scheme more equitable by putting the allowances on a needs basis- is just as misguided, but the reasons are more complex. At first glance it might have some appeal to allocate allowances according to the number of dependants of the applicant, particularly if such a policy were applied only to new trainees so that many existing trainees would not be cut back midway through their training. However, such a policy involves a fundamental misconception of what NEAT is all about. It assumes that NEAT is some kind of welfare scheme in which the beneficiaries receives a little extra for doing some retraining instead of just waiting for a job to turn up. But that is not the real purpose of NEAT. It was conceived not as a welfare program but rather as a crucial part of an active manpower program in which the principal aim is to ensure that the labour market is well balanced; that is, that the numbers offering for employment in each occupation are as nearly as possible equal to the job opportunities available for each occupation.
Given that the scheme’s objective is to overcome structural imbalances in the labour force, it is far more appropriate to set the allowances on criteria that reflect the labour market nature of the program rather than on an irrelevant welfare concept. That in fact was what was recommended by the Cochrane Committee of Inquiry into Labour Market Training which was established by the then Minister for Labor, the honourable member for Hindmarsh (Mr Clyde Cameron), in December 1973. That Committee considered in some detail what would be the appropriate form of the allowances to be paid under a comprehensive training scheme such as the then Government was intending to establish. In doing so, it observed that allowances payable in some of the then existing training schemes were based on the appropriate welfare benefit plus a supplementary training allowance. In view of what is now happening, it is extraordinarily interesting to note that the Committee decided nevertheless to reject the welfare approach and did so on the advice of then Department of Labor, which Department recommended not only abandonment of the welfare approach but also that the allowance be based on the average adult male award wage. That was accepted by the Committee and the Government and is the basis of the current rate of $96.80.
Thus we have the rather extraordinary situation that in drastically altering the form of the allowance the Government is acting against the wishes of the Department which was greatly involved in devising the NEAT scheme and which now administers that program. This raises the very pertinent question of whose advice the Government is following in moving to change the allowances. It is also relevant to note that the Department recommended the flat rate allowance because it considered that the allowance should be such as to give an incentive to people to retrain but not so high as would in general equal what the trainees would earn once trained. The Committee accepted that and also recommended that the allowance be taxable so that the after-tax allowance would vary according to the number of dependants. This, of course, is exactly what happens to wage earners; they are not paid according to the number of dependants but are paid a rate for the job and the state then takes account of the number of dependants in considering what level of income tax should be paid on that wage.
Thus it is clear that the original allowances for NEAT trainees were not grabbed out of the air but were a calculated assessment, by the then Department of Labor, the Cochrane Committee and eventually the Government, of what would be a reasonable rate looked at from the standpoint of the needs of a successful manpower policy. From what I have said to this stage it is clear that the Government’s action is quite reprehensible in that it will limit severely the development of a comprehensive retraining program and will create hardship for current trainees. We suggest, therefore, that the Government should scrap its proposed new allowances and retain the original form of the allowances. If it will not do that, we ask that it at least give consideration to phasing in the new allowances so that trainees who commenced on the old allowances are not adversely affected. If the Government is determined to wreck the NEAT scheme, we see no reason why it should insist on wrecking the lives of the trainees as well.
– The speech of the honourable member for Gellibrand (Mr Willis) was full of misconceptions, but it contained one error of fact which I should like to correct at the start. He referred to the case of a widow with 2 dependant children. I point out to the House that such a trainee under the national employment and training scheme gets her widow’s pension to which she is entitled, plus child allowances, plus a rent allowance if applicable, and in addition is permitted to earn $20 a week before any reduction is made in her allowance, not $6 a week as alleged by the honourable member for Gellibrand.
Having said that, let me say that I am indebted to the honourable member for providing an opportunity for this House to expose one of the most inequitable, ill-considered schemes of the previous Government. There were so many in this category that we are not able to examine all of them; so I thank him for the opportunity to examine one of the worst. When the former Government approved the introduction of its national employment and training scheme it accepted that the full time training allowance should be equal to the average adult male award wage. I point out that the Labor Government simply did not live up to its commitments with regard to the adjustment of the full time allowance. It was allowed to fall into limbo. Only one adjustment was made, in May 1975, up to the $96.80 a week, on the ground that the principle of indexation was being applied to the full time allowance. No further adjustments were made. So, any allegation by the Opposition that there is some breaking of an undertaking by the Government is so much humbug. No scheme is immutable and in fact that was recognised initially by the previous Government. It repudiated its own agreement with people who signed up under what were the original NEAT arrangements. One the other hand, we are doing exactly what we said we would do prior to the election. The reason for the previous Government’s failure to live up to its commitments is not difficult to find. One newspaper last week put it very aptly It stated:
The NEAT scheme, despite its initial good intentions, quickly established a reputation for itself as one of the more outrageous middle-class fiddles introduced by the Whitlam Government.
The point is that the NEAT system was not assisting all of those it was intended to assist or those in need. Labor was stultified, devoid of ideas and unable to redress the grave inequities which it itself had created. However, the experience with the NEAT allowance demonstrated another of Labor’s shortcomings, and that was its inability to co-ordinate different programs. A trainee under NEAT got a wage-related payment of $96.80 a week entirely free of means or income testing. A person regarded as furthering his education got a basic allowance of about $33 a week subject to a means test. This was despite the fact that 2 people, each on one of those differing allowances, could be side by side in the same school studying the same subjects. As I said in my Press statement on 11 February when detailing the new arrangements for NEAT:
The means test on the NEAT allowance in common with all other means tests will be examined in the course of the operations of the review of income security.
The Government, in coming to office, reviewed NEAT and decided on the following criteria:
I should like to point out that the basic purpose of NEAT in a time of rapid technological and structural change is to enable people to upgrade their skills so that they can make a satisfactory life for themselves and a productive contribution to the economy. Essentially therefore NEAT is directed towards people having difficulty in getting a job. The concept is excellent. But as with so many schemes of the previous Government, it went completely haywire in its application. People with perfectly good jobs just walked in off the street and straight into NEAT-at $96.80 a week paid by the taxpayer. People who just wanted to do a course which interested them were accepted into NEAT by the thousands- at $96.80 a week paid by the taxpayer. People who genuinely wanted to learn a new skill but whose family incomes could be in the region of $20,000 to $30,000 a year were accepted into NEAT- at $96.80 a week paid by the taxpayer. The Government supports the principle of people being able to get a skill for a job which is in demand in the work force. But under the Labor Government the NEAT scheme was in all too many instances a racket. We made it perfectly plain that we intended to apply a means test to NEAT so that those who were in genuine need of assistance would get it. Thanks to the disastrous policies of the previous Government, there were certainly plenty of people in that category. Having created the greatest pool of unemployment in Australia since the Depression, one claim Labor could make was that there was a need for NEAT.
Let us look at the composition of the hundreds of thousands of unemployed. Who are the very first people hurt when there is a recession? It is the people with the least skill- the unskilled and those with minimum skill. It is no coincidence that while over 5000 professional and semiprofessional people have been accepted into NEAT only 188 unskilled have been accepted into the scheme. That is because the previous Labor Government completely failed to establish proper criteria for eligibility. People who knew how to work the system got a very large share of the $50m-odd made available for the scheme. I should have thought that the Australian Labor Party of all parties would have been interested in seeing that those most disadvantaged sections in the community- the unemployed with very little skill- were the first, not the last, to be assisted by a training scheme. But no. These people were neglected by the Labor Party and they made their feelings known in the ballot box last December. Traditional Labor supporters deserted the Party in droves. Not only had these people been put out of work by the Party’s policies, they then were largely ignored in the application of the training scheme which allegedly was designed to find them other jobs.
For months prior to the last election we made it clear that the totally inequitable situation which applied then, while apparently being quite acceptable to the Labor Parry, was certainly not acceptable to us. We said that as soon as we were in a position to do so we would introduce a means test for NEAT to ensure that the allowances paid under the scheme more accurately reflected the needs of the individual trainees in the scheme. The allowances paid under the new arrangements are composed of 2 elements. The first concerns the unemployment benefit to which the person concerned would be eligible. This of course varies with the individual circumstances of each person. Those with a dependent spouse and one dependent child will get very nearly the same amount as they did under the old arrangements. Those with a dependent spouse and two or more dependent children will get more than they did under the old scheme. I put it that that is as it should be. But in addition to the unemployment benefit to which the individual is entitled, a training component equal to 20 per cent of the average male award wage is also payable. It is 10 per cent in the case of those under 18 years of age. At the present time the training component is $23.40 for adults or $1 1.70 for those under 18 years.
The new arrangements are not restricted only to those who are entitled to unemployment benefit. Trainees coming from a family where the combined income of the trainee and the spouse is up to $238 a week or about $12,000 a year are still entitled to the training component of $23.40. Even further than that, under the new arrangements, trainees who are excluded by the means test from both the unemployment benefit component and the training component, that is, where the combined income of trainee and spouse exceeds $12,000 a year, the trainee is entitled to free books and payment of fees for the course he is undertaking. In other words, the scheme is now properly related to the needs of those seeking training. Incidentally, for the information of the House I might point out that unlike the allegations that have been floating around in recent days, there is no evidence so far at any rate of any large scale withdrawal from training as some people seem to believe.
So first of all, to be eligible for NEAT people have to be unemployed- unlike the situation which applied when the scheme was introduced. Secondly, the skill which the unemployed are seeking to be trained in must be in demand in the labour market- again unlike the original scheme. Thirdly, the allowances paid under the scheme will reflect the individual needs and circumstances of the trainee so that the really disadvantaged, such as those with a dependent spouse and two or more dependent children, will get more under the new arrangements. As a result of the change and as a result of the Government’s decision not to cut the total amount allocated to NEAT, despite stringent restrictions on government spending made necessary by the spendthrift policies of its predecessors, approximately an additional 3 000 people will be able to be accepted into the NEAT scheme. That figure will include many juniors unable to get a job because of the campaign of industrial destruction of the previous Government and many semi-skilled and unskilled adults put out of work by the same disastrous economic incompetence.
-The Minister for Employment and Industrial Relations (Mr Street) made a rather rash statement something along the lines that under the National Employment and Training Scheme as operated under the previous Government, people walked in off the street for training, leaving good jobs, obviously simply because of the open endedness of NEAT. Obviously the Minister completely ignored the guidelines laid down by the honourable member for Hindmarsh (Mr Clyde Cameron) when he was the Minister for Labor. These were very strict guidelines and laid down very clear priorities. The Minister completely ignored that fact, which is a very important point, because our Government, by laying down these guidelines, ensured that people would not just walk in off the street, as the Minister put it, and leave good jobs. It ensured that they had to establish a very clear and concise case before they could be granted assistance under NEAT. I do not think it is a very good approach by the Minister to try to mislead the House in that way. The action of the Government is dishonourable. It is tantamount to breaking a contract. Without a doubt, the Minister has to take the responsibility although from conversations I have had with him over the years I have always thought him to be a very honourable man. Therefore I can only conclude that he has been instructed by the Prime Minister (Mr Malcolm Fraser), who would not be as honourable a person as the Minister, to take this action. I think it is a pity because it is destroying the reputation of the Minister to take this action. I think it is a pity because it is destroying the reputation of the Minister when the man whose reputation should be at stake is the man who made the real decision, the Prime Minister himself.
It is one thing for the Government to decide to reduce allowances for students now coming into the scheme. That would be quite an honourable act, but deliberately to break a contract, to go back on an undertaking given by the former Government, to break the essential convention that has been laid down and followed by previous governments, that a decision of the previous government shall be adhered to by an incoming government, is a dishonourable act. Students under the NEAT scheme entered into commitments in the belief that they were to get X amount as an allowance. They have hire purchase commitments and are paying off mortgages. I have on file in my office records of people who had exactly these commitments.
They entered into NEAT in the belief that they were to get $96-odd and therefore would be able to meet their mortgage and hire purchase commitments. Now they have no alternative but to leave their courses.
The Minister also stated that there has not been a large scale withdrawal from the various courses. Of course there has not been at this stage. The whole thing only starts on 1 April. That is when there will be large-scale withdrawals, and they will be pretty hefty. People such as those who have visited my office will withdraw from courses because they will simply not be able to subsist on the allowance which the Government intends to pay under the new scheme. We have some very good examples of what will happen. For example, the Leader of the Opposition (Mr E. G. Whitlam) received a letter signed by 27 foreign language speaking students who were teachers in their own countries but who now wish to do a conversion course in English so that they can teach in this country. They would be very useful people, particularly in migrant areas such as the one I represent, where they would be excellent teachers to look after the interests of migrant students.
– You have always had a deep interest in migrants.
– What the honourable member for Hindmarsh says is quite correct. Let me quote a few excerpts from the correspondence sent to the Leader of the Opposition by these 27 students. They say:
This assurance -
That is the assurance that they would get $96.80- is the prime mover for the majority of students to join the course and to give up jobs that supported their families which they will not be able to take up again.
They go on to say:
Under these circumstances the students concerned will be forced to discontinue the course, and since this is the majority the continuation of the course will be in jeopardy.
Then they say:
Because of their experience -
That is the experience of these students- they -
The migrant teachers- will be in a unique position to understand and assist with the social and learning problems facing migrant children.
The Age of Saturday, 13 March, reports that the Victorian Government has taken up the case of people doing NEAT courses. The Victorian Government has decided to take up the tab and pay the difference between what these people will receive from the Federal Government and what they would have received had the allowances not been reduced by this Government. Surely one cannot call that anything other than a condemnation by the Liberal Government of Victoria of the Liberal-National Country Party coalition Government in Canberra. The decision to take up the tab and meet the difference is in itself a condemnation of this Government by a government of the same politics. In other words, the Victorian Government can see how unjust the Federal Government’s action is. This in itself vindicates and recognises the justice of the proposal by the Opposition today to discuss this as a matter of public importance.
Let me refer to what happened, apparently, in the joint Government Parties’ meeting only yesterday. Apparently these days there are some good leaks to the Press. It is all in this morning’s Australian Financial Review, from which I shall quote. This newspaper has obviously received the information by way of leaks from the Government Party room. It says:
The Government’s new income test on the NEAT scheme and the poor communication between Ministers and backbenchers were two matters vigorously canvassed by private members at yesterday’s joint Government parties meeting.
Backbenchers showed no signs of docility in the face of Mr Fraser’s ‘strong hand ‘ on party matters.
A number of members showed their disquiet at the way the means test had been applied to NEAT recipients.
Some said that the Government’s decision is destined to result in wasted expenditure.
I agree with that, because if students leave their courses in mid-stream the resources will be wasted. Instead of completing the courses and then being able to find employment in the areas in respect of which they had studied, they will be forced to leave the courses before completing them. All the finance that has already been poured in by the previous Government and the present Government to train these people will be completely wasted. The Australian Financial Review goes on to say: … in that some trainees would have to discontinue their courses half-way through.
Once again this is indicative that the attitude that the Australian Labor Party is expressing today is vindicated. It is common sense. I would suggest that the back benchers opposite who yesterday criticised the Minister for Employment and Industrial Relations and the Prime Minister in respect of this dishonourable action by the Government come across to the Opposition side of the House, show the colour of their conviction and vote with the Opposition in this matter.
Sitting suspended from 12.58 to 2.15 p.m.
– It is both distressing and depressing to note the attitude of the Opposition in this vital matter of public importance. The attitude of members of the Opposition compares rather dismally with the clear exposition of the position given by the Minister for Employment and Industrial Relations (Mr Street). I was particularly concerned at the attitude of the honourable member for Chifley (Mr Armitage) who spoke before me in this debate because obviously he does not know the scheme initiated by his own party. The honourable member conveyed the impression to the House that he not only did not know the scheme but also that he did not care about it. He gave me the impression when he sat down that he had been butchered. Of course, there is a reason for his not knowing about the scheme. This scheme was one of the many policies that mushroomed during the term of office of the Australian Labor Party. It bore the hallmark of haste, it obviously lacked clear direction and through the conflict created it brought about a compromise which has resulted in an ineffectual scheme.
Compromise in this area of the National Employment and Training scheme became, I submit, an occult fraud because the scheme did not assist the people whom it was designed to assist. It did not assist those workers in most need. There was an irresponsibility in the whole scheme. Of course that irresponsibility is the direct result of an absurd proposal as implemented by the Australian Labor Party.
Our society was developing a ‘handout mentality’ boom during the 3 years of the Labor Administration. We found out on 13 December that the principles applicable to NEAT revealed the taint of this big boom. The Labor Party’s ground rules on NEAT revealed the nonsense of its claim to rationalise resources. I submit that in effect the Labor Government gave the little finger to those in need and the open hand to those who sought to manipulate society. I believe that society has a responsibility to retrain people. But how much responsibility has society to carry out this task? There are progressives, the left wingers in the Labor Party, who believe that we as a society have an infinite responsibility continually to train people.
Many examples have been given of handouts to people who had no intention whatsoever of working and had not worked for many years. We on this side of the House, of course, are realists. We realise that someone has to pay for these schemes. Actually the trainees under the Labor
Party’s NEAT proposals were the best paid trainees in the history of this country. We, of course, are aiming to be more honest with the people’s money. I applaud the very quick action of the Minister after 13 December to relate our policy to a needs basis so that more people could be assisted to overcome employment difficulties. The Minister has given to the House details which lay bare the claims of the Opposition that people will be disadvantaged. The Minister gave details of many instances where people will get more money under our proposals. They will get more money based on a proposition of need and justice. I fully support the Minister’s outlook and philosophy.
I want to lay bare once and for all the facetious claims of the Opposition that widows will be worse off under our proposals. This is not so. The Minister related in chapter and verse the details of this situation which proves to all the shallowness of the Opposition’s approach in this matter which we believe to be of fundamental importance and significance. The Government has established the principle that we will retrain people not in 4 months’ time but immediately. These people will not have to wait for 4 months. They will be retrained immediately providing that the job they are to be retrained in is a job which will provide work when the retraining is finished. Therefore our principle is one of retraining people immediately.
The Minister stated that the training component which will be added to the unemployment wage is to be based on a means test and that the means test will be reviewed possibly in the very near future by the committee undertaking a review of income security. I endorse those remarks. As a result, those people in need will receive the assistance that is applicable to their particular situation.
I want to analyse some of the results of the NEAT scheme. What stands out with crystal clarity is the fact that the people who are basically unskilled are the people who have suffered under the Labor Party’s proposals. These are the people who are in great need of retraining so that they can be equipped for a more meaningful job in life. But the positions under the NEAT scheme have gone to the professional and semiprofessional people.
The honourable member for Chifley made great play of the abrogation of a contract by the Government. I think it is interesting to point out what the Prime Minister (Mr Malcolm Fraser) said in his policy speech. He said:
On 14 December we will start the most rigorous planning for the 1976 Budget. We as a Government will be concerned that you get value for the dollars we spend on your behalf.
Similarly in his Budget speech last year, which of course was the document which planned the future of the Australian society and was the cause of the annihilation of the Labor Party, the present Prime Minister said:
We would have means tested the employment training schemes.
That is why the Australian people decided on us as the Government of this country on 13 December. We were explicit in our proposals. Our proposals were based on principle and not on fantasy or a handout mentality. Honourable members opposite talk about the breaking of a contract There was no contract entered into at all by this Government. We have a policy of retraining people. We are giving them a retraining benefit to help them on their way. We are not going to give them a handout to allow them to become married, to purchase a house or a refrigerator. That is not the purpose of the scheme. Those are matters for personal, not government, decisions. The scheme is concerned with retraining and is not motivated by all of the other considerations, desirable though they might be.
Shame on honourable members opposite for talking about the breaking of a contract Let us look at who broke the contract. The Labor Party, of course, after dreaming up this scheme which was not based on fact or principle, said that increased benefits would be made according to movements in the consumer price index. That increase was given once. It has not been given subsequently. Honourable members opposite are the people who broke the contract, not us. We did not give a contract. What about the previous Government’s contract to the Australian farmers in respect of the superphosphate bounty? The previous Government removed that bounty. Yet its members now talk about the breaking of a contract. These are idle words. They are the utterances of empty vessels and obviously mean nothing. No wonder the Labor Party lurched and swayed around and finally buckled at the knees on 1 3 December last year. What about the usurping of the contract with the Australian people? The Labor Government came to power on a contract to give decent, honest government. The history books of Australia are riddled with dishonesty and scandals over 3 years. Yet members of the Labor Party come here and have the effrontery and cheek to talk about contracts. The Australian people are not going to put up with that.
The Minister has had a difficult job to do. The Labor Party was incapable of cleaning up the mess that it had created. It spent all of its time gobbled up with internecine strife. Our policy is to give a training incentive of $23.40 per week. We are going to clean up the mess. We have allowed until 1 April for the old scheme to be phased out. We will continue with the scheme.
Let us look at the help that was given in other areas- to people who wanted to help themselves, to people with a little bit of get-up-and-go. They were given only $33 a week for tertiary assistance yet others were given a handout of over $90 a week. I believe that, notwithstanding the many personal difficulties that will be faced in the new scheme, if people are determined to improve their own lot the guidelines are there. They can work within the framework which has been laid down so logically and explicitly by the Minister and they will be able to continue their education and their retraining.
-Order! The honourable member’s time has expired.
– I think the speech just delivered by the honourable member for Darling Downs (Mr McVeigh) would be one of the most reactionary speeches that I have heard in this Parliament for more than 20 years. Indeed I would say that it is the most reactionary and frightening speech that his own National Country Party colleagues have ever heard because even they looked disturbed and terrified by the excesses to which this honourable gentleman was prepared to go. The honourable gentleman regards himself as the representative of rural interests only. He has no concern at all for the needs of secondary industry of our great cities or of the person who has only his or her labour to sell.
The honourable member said: ‘We will train the people immediately.’ But that is the problem which I faced when I was the Minister for Labor and Immigration. People cannot be trained immediately to do the son of work that can be done by immediate training unless there is ‘in-job’ training available to follow up the preemployment training. We cannot have ‘in-job’ training in a period of high levels of unemployment.
One of the great tragedies of the National Employment and Training scheme is that it was not introduced in August 1973 when 1 first sought to have it introduced. At that time it could have succeeded because it could have got off the ground when there was a high level of employment instead of having to wait, as we eventually did. until October 1974 by which time there was a high level of unemployment. That was the great tragedy of the scheme.
The NEAT scheme is a very great scheme. It is a scheme of which once again I can claim to be the architect. Nothing like it had ever been dreamed of before in Australia. Before this scheme was introduced we had 12 separate schemes- a hotchpotch of schemes that did not represent anything rational. Under one of those schemes, after it had been operating for nearly a year, the Government of the day had succeeded in training 3 people. That was the sort of training which the Australian Labor Party found on the books of Government after 23 years of LiberalCountry Party government- a government of the same political persuasion as that which now says that it believes in immediate training.
The success of the scheme depends, of course, on its attractiveness to prospective trainees. If the Government cuts the allowance it will cut the intake. If the intake is cut then the whole future of NEAT will be jeopardised. I repeat that NEAT is the first real attempt by this nation to overcome the problems that were forecast in the Borrie report. Honourable members should read the Borrie report and see what the future of this country is likely to be if we do not pay attention to training, especially to the training of tradesmen. If we do not spend more money on technical education and less on tertiary education, and if we do not produce more tradesmen, technicians and technologists and fewer Doctors of Philosophy, historians and people of that kind, industry in this country will face a perilous future. We need tradesmen urgently and we will need tradesmen more than ever in the immediate years ahead.
The only real hope for industry is that it will not be handicapped by a shortage of skilled labour. The world has already been overtaken by technological change which is manifest in every industrial country. Industrial countries will not be able to survive in the years immediately ahead unless the demands of technology and industrial changes are met. We have to be prepared to spend a lot of money on it.
As the Minister for Employment and Industrial Relations (Mr Street) said, the previous Government accepted the average award rates as the basis for the allowance which at that time was $90 a week. However, we decided that we would not increase the $90 a week after the December quarter because in the December quarter there had been substantial savings in taxation from which the NEAT trainees benefited in the same way as other workers benefited. But we said that, immediately the Arbitration Commission announced its decision in respect of wage indexation, we would apply to the NEAT allowance the increases reflected in the Consumer Price Index as might be applied by the Arbitration Commission to awards generally. In accordance with that proviso there was an increase in the NEAT allowance in May 1 975. If there has been none since then, that is not my fault. It is of no use honourable members opposite blaming me for it. All I can say is that while I was the Minister we did increase the NEAT allowance by indexing it in the way in which I had undertaken to do.
As everybody knows, I was sacked very shortly after the last adjustment was made to the NEAT scheme; so I take absolutely no responsibility for what happened after my dismissal. I cannot recall the matter being discussed by the Cabinet at any meeting which I attended. So whoever decided not to continue the indexation of NEAT did so without my knowledge and, so far as I know, without the approval of the Cabinet.
The Minister said that under the scheme when I was the Minister presumably people with good jobs just walked off the streets and qualified for a $96.80 training allowance. Of course, that is not true. If it is true it was done against my specific ministerial instructions. The minutes of the Department will show that I gave strict instructions that this was not to happen.
There were anomalies at the beginning of the scheme. It was a brand new scheme. It had teething troubles. It had to have them. But these anomalies were stamped out as soon as I was aware of them. One very senior member of the Department of Labour and Immigration decided to give his own wife a NEAT training allowance, and other senior officers of my Department gave relatives and friends NEAT allowances under the scheme. But as soon as I discovered it I stamped it out. As a matter of fact there is a Liberal member of this Parliament whose wife right now is receiving a NEAT allowance at the Canberra College of Advanced Education. So let us not be too finicky about that. It should not occur and it can be stopped by administrative means without introducing a means test.
It is true that unskilled people are the ones who need the most attention, but what is the use of talking about training unskilled people to do the kind of training that they can undertake in a period of very high unemployment? Rather than have the scheme collapse altogether because the employment climate was not suitable for a training scheme, requiring ‘in-job’ training, I decided to allow the scheme to be applied to tertiary training. In the departmental records there are numerous minutes in my own handwriting saying: ‘How many more accountants are you going to train under this scheme? Please stop training people to become psychologists, sociologists, accountants or for some other similar occupations. Why do you not pay more attention to training people to become skilled tradesmen, technologists or technicians?’ That is what I wrote time and time again on the minutes of the Department. The Minister knows that they were the sentiments which I expressed. At no stage did I ever suggest that the allowance ought to be reduced. Of course I did not.
I believe that the NEAT scheme is not understood. I doubt whether anybody who has spoken so far, apart from the honourable member for Gellibrand (Mr Willis) and the Minister, has even read the Cochrane Report that recommended NEAT. I would like permission to incorporate in Hansard the first recommendation of that Committee of Inquiry into Labour Market Training appearing on page vii of the report.
-Is leave granted? There being no objection, leave is granted. (The recommendation read as follows)-
1 MANPOWER FORECASTING (PARAGRAPH 2.33)
The Committee recommends that-
urgent consideration be given within the Department of Labour to the introduction of procedures for collecting labour market information and for monitoring changes occuring in the labour market both in terms of occupations and regions;
priority be given to the provision of adequately trained staff to undertake this work;
careful attention be given to the staffing of a manpower research unit being established by the Department of Labour to ensure that an energetic programme of research is directed towards the provision of information regarding Australia’s future manpower requirements;
this unit be charged with the responsibility of maintaining liaison with all other educational bodies and commissions; and that-
-The scheme is an amalgamation of the 12 previously existing schemes in favour of one comprehensive scheme in the whole area of training. Its objectives were set out clearly on page vii of the report and I ask leave to have them incorporated.
-Is leave granted? There being no objection, leave is granted. (The objectives read as follows)-
its objectives be to:
-Eligibility for NEAT was to be related to need, as set out in recommendation 3 on page viii of the report. I ask that that be incorporated in Hansard.
-Is leave granted? There being no objection, leave is granted. . (The recommendation read as follows)-
3 ELIGIBILITY (PARAGRAPH 3.16)
persons eligible under a labour market training scheme be- those whose employment prospects have been, or are likely to be, adversely affected by a variety of factors, and for whom assistance with training is required to help them find suitable employment. Such factors include tariff cuts; technological changes or other’ redundancy-causing situations; residence in an area where employment opportunities are limited or dedining; absence from employment for reasons such as health, incapacity, imprisonment, domestic responsibility or possession of inadequate or inappropriate work skills. Persons who enter approved forms , of training designed to alleviate labour shortages will also be eligible for assistance;
there be no constraints in regard to the age of trainees or to the length of the training period; ‘
great care be exercised in the operation of the scheme to ensure that abuses do not arise as a result of having no constraints on age or length or training; and that-
-The Committee recommended against setting priorities, but I rejected the Committee’s recommendation that there should not be priorities and the Cabinet supported my recommendation. There are priorities contrary to the view that one would gather from what the Minister said. I laid down those priorities and then the scale of NEAT allowances was also clearly set out in recommendation 15(iii) on page xii of the report. I seek leave to have that incorporated in Hansard, together with paragraph 6. 1 and 6.2 on page 59.
-Are these incorporations very voluminous?
– No. The Minister has seen them.
– Is leave granted? There being no objection, leave is granted. (The passages read as follows)-
6.1 To some extent the number of applicants for training will depend upon the amount of the allowance paid during the training period. If the training allowance is very low there will be little response to the scheme, if it is very high the response could be overwhelming. Exactly where to fix the level of the training allowance is a matter of judgment, but it is possible to narrow the range of this judgement by indicating some general guidelines*. These are that the amount of the training allowance should behigh enough to act as an incentive to single people, and people with dependants, to be prepared to undertake training; higher than the level of unemployment benefit; and lower than the income that can be earned in employment after training. 6.2 These guiding principles indicate that the amount of a full-time training allowance should be placed between the fairly wide levels of unemployment benefit and post-training earnings- the precise amount to be chosen being sufficiently high to provide a reasonable living income during training for a married person with a family. Considerations of equity and a desire to ensure the implementation of effective labour market training are factors which assist in the final determination of the amount.
– I apologise. The honourable member ‘s time has expired.
– I am glad to be able to follow the honourable member for Hindmarsh (Mr Clyde Cameron) in this debate because he is what I would call a typical South Australian- benign, generous- sometimes, people say, to a fault. I have often heard stories of his forgiving nature. I would say he is proud of his scheme- the National Employment and Training scheme- and he has every reason to be proud of it as it was conceived. When he is as old as he is, conceiving schemes is not easy. I can understand his affection for his scheme because one conceived so late in life does have attractions for a man, I guess. The trouble is that from then on the child that he conceived suffered the same faults as other children conceived in old age. It got spoilt. It was just about his only child and it became spoilt in a way. His scheme became the laughing stock of Australia. It became the laughing stock of my electorate.
People think that farmers have not got many brains. Those people who think like that underrate them. It was not long before I started to hear rumours about this NEAT cow that Cameron had bailed up down in Adelaide and people said: ‘Let us go down, Bert, and milk it’. Some of them went down and they were startled to see the former Minister with typical dedication and devotion to duty sitting there pulling frantically at this cow. The only trouble was that half the milk was going on the floor. It became almost a scandal in my area. People would come to me and say: ‘Look, Bert, we ought to get into this racket’. I would say: ‘Now you must have a sense of responsibility’. I would give them a lecture as befits a man of my modest nature. I used to give them a talk and say to them: ‘You must not behave like that’. They would brush me aside and they would say: ‘Bert, if there is a cow in a bail like that we are not going to be caught for want of a bucket. It is your job to help us get into this racket’. I would say to them: ‘You go away and do it. Go to the Minister himself. I guess they did and with his typical generosity and benign nature he would say: ‘Yes, certainly’. I do not know whether he did, but the cow was milked frantically and enthusiastically by all who passed by.
I have to add another experience. I remember a doctor’s wife coming to me and saying: ‘This is not fair. I understand that this scheme has been cancelled and there is going to be a means test applied. I have been getting $93.44 a week and now the whole thing is cut off. It is not fair’. That was the child the honourable member for Hindmarsh conceived so late in life. It was good in principle. It looked a fine upstanding baby until he started to spoil it. There is another example involving a parliamentary colleague whose name I cannot mention for reasons which honourable members will understand. Things were not too good at one stage when parliamentary salaries had not increased for some time. His wife thought that the scheme was a way to relieve the situation so she went along to the Department and told her story about how more money was needed in that parliamentary home. The Department said: ‘Certainly, we would like to help’. She was enrolled. There was no means test. She was not a very bright lady. I do not think she got all the facts clear, but she said she understood there was a $500 dress allowance. There was, I understandand she was rather disappointed to find this- a means test on that, but generally speaking she was startled to find how generous the scheme was. She will not hear to this day a word of condemnation of the honourable member for Hindmarsh. She said that this is the kind of personthe Father Christmas- we have been looking for, who will do what we want when we want it. She then started to study. I remember my colleague coming to me and telling me with tears in his eyes that one day he came into the home after being away in Canberra for a week and there was his wife sitting at the table surrounded by books. She did not jump up and give him the warm welcome he used to expect. She just sat there studying. My colleague said rather caustically: ‘What are you doing, dear?’ She said: ‘I am on this NEAT scheme’. He said: ‘Yes, I can see that, but what are you doing?’ She said: ‘I am studying to become a member of Parliament’.
That is the kind of nonsense which arose in respect of this scheme of the Minister. I mean the honourable member for Hindmarsh. I keep on calling him the Minister because we think of him still- we think of his mistakes as Minister for Labor. This was probably his greatest mistake of all and it was conceived, as I said, in generosity, with typical generosity that one would expect from a man of such a benign and forgiving nature. He set up a scheme of which he ought to have been able to be proud and of which we will be proud too. I do not think we ought to dismiss it. Of course, we do not. We are going to improve it. We will be able to look back with pride just as the honourable member for Hindmarsh will. He conceived this scheme and other people, particularly the Minister for Employment and Industrial Relations (Mr Street) to whom I am proud to pay tribute, have altered and made it more sensible and responsible because it was a good scheme in conception. The way it was administered made it a laughing stock of Australia.
-The discussion is now concluded.
Bill presented by Mr MacKellar, and read a first time.
– I move:
The purpose of the States Grants (Housing Assistance) Bill is to authorise the Treasurer to advance to the States this financial year the sum of $364.6m for welfare housing in accordance with the provisions of the 1973-1974 Housing Agreement. This amount will be distributed among the States as follows:
The level of advances for 1975-76 is as determined by the previous Government and this amount has been provided in the 1975-76 Budget. We are maintaining this level of spending for welfare housing despite our overall policy of stringent restraint on public sector spending. Advances for 1975-76 will be somewhat less in real terms than the record level set in 1974-75-$385.4m-but still high compared with earlier years.
Some States are currently experiencing difficulties in maintaining their welfare housing programs- difficulties, I might add, that are a direct legacy of the previous Government. Let me explain this. Funds available to the States for welfare housing increased from $ 169.8m in 1972-73 to $2 18.7m in 1973-74. The funds made available for welfare housing escalated even further in 1974-75. When the initial allocation of $235m was made, the States were informed that further funds would be provided if they could demonstrate that they had the capacity to spend more. This encouraged the States to accelerate their programs and the advances actually made in 1974-75 rose sharply to $385.4m, and increase of about 60 per cent over the original allocation. Then, in the 1975-76 Budget, the inevitable happened. The enormous expansion in advances to the States was brought to an abrupt halt and total advances in 1975-76 were held at about their 1974-75 level.
Because of the earlier rapid expansion of their programs, most States have had to curtail commencements sharply in 1975-76 to permit the completion of houses already under construction. As a result, the level of government building activity has declined. Nevertheless Housing Agreement commencements which constitute the bulk of State government housing activity will probably exceed 7000 in 1975-76. Although this figure is significantly less than the 1 1 463 Housing Agreement commencements in 1974-75, completions in 1975-76 are expected to reach a record level of 13 800. Overall, therefore, the public housing programs in the States in 1975-76 will still be substantial.
Meanwhile, signs of recovery in the private sector emerged around the middle of 1975 and a continued high level of activity in most States can be expected. Loan approvals for housing, local government approvals amd commencements have all been expanding strongly since mid-1 975 and point to further expansion in private commencements during the coming year. In the December quarter, dwelling approvals were running at the rate, seasonally adjusted, of 137 800 private and 7900 government, totalling 145 700, compared with 90 800 private and 20 900 government, a total of 1 1 1 700 in the December quarter of 1974. Commencements for the 1975 December quarter were running at the annual rate, seasonally adjusted, of 125 400 private and 132 400 total. Comparable figures for the same quarter in 1 974 were 96 300 private and 1 1 3 900 total commencements. The expected continued high level of activity in the private sector should go some of the way towards taking up the slack emerging in the government sector.
The Bill also authorises the Treasurer to pay to the States in the first 6 months of 1976-77 the sum of $ 182.3m, which is half the allocation for 1975-76. This amount will be distributed on the same basis as the advances for the current year. In other words, the Treasurer will be authorised to continue payments to the States for welfare housing in the period from 1 July 1976 until an appropriation measure for 1976-77 is passed by the Parliament. As well, the Bill recognises that, in exceptional circumstances as occurred this year when passage of the authorising legislation was delayed, it may be necessary to continue payments beyond the 6-month period for which specific financial provision is made. The Bill provides that interim payments may be made for welfare housing under the authority of section 5 of the Financial Agreement Act 1928 as advances supplementary to the advances under the approved Loan Council program.
The advances to be authorised by the States Grants (Housing Assistance) Bill are repayable over a period of 53 years. The rate of interest payable on advances during the full 5-year term of the Agreement is fixed at 4 per cent per annum in respect of advances allocated to the State housing authorities and 4V4 per cent per annum in respect of advances allocated to the home builders’ accounts of the States. The apportionment of the allocations between the State housing authority and the home builders’ account for each State was determined by consultation between the Minister for Housing and Construction in the previous Government and the Housing Minister of the State concerned. The repayable interest-bearing advances will, as circumstances dictate, be made from either Consolidated Revenue Fund or the Loan Fund and will be on the terms and conditions set out in the 1973-74 Housing Agreement. Provision is made for any payments out of the Consolidated Revenue Fund for this purpose to be reimbursed in due course from the Loan Fund, when the Treasurer considers this appropriate. I commend the Bill to honourable members.
Debate (on motion by Mr Young) adjourned.
Bill presented by Mr Viner, and read a first time.
– I move:
This Bill provides for the payment of grants to the States for universities in 1976. The Bill is associated with the States Grants (Universities) Amendment Bill 1976, the States Grants (Advanced Education) Bill 1976, the States Grants (Advanced Education) Amendment Bill 1976 and the States Grants (Technical and Further Education) Amendment Bill 1976, all of which I intend to introduce presently. Rather than take up the time of the House unnecessarily, I propose to speak on the common aspects of all 5 Bills in this statement.
The previous Government decided that the year 1976 should be treated outside the normal triennial progression and asked the 4 education commissions to recommend separate programs of funding for 1976 within certain guidelines. This Bill and the related ones represent the implementation of the announced decision of the Government in its caretaker capacity in November last that the programs for 1976 approved by the previous Government for universities, colleges of advanced education and technical and further education should proceed on the basis announced by the previous Government. This undertaking assured the States and the educational institutions concerned of the level of financial support they could expect in 1976 even though the prorogation of the Parliament in November 1975 made it impossible until now to enact legislation appropriating funds for the 1 976 programs. I shall be introducing later in this session a Bill to provide for the announced 1976 program for schools which the Government also undertook to implement. To enable the programs under this Bill and the associated ones to proceed, with effect from the commencement of 1976, the caretaker Government made special interim financial arrangements with the States pending the passing of these Bills early in 1976. The Bills in respect of universities and colleges of advanced education provide for reimbursement of the States where they have made payments under the special interim financial arrangements. This provision was not necessary in the case of technical and further education where existing legislation provides financial assistance to the States until 30 June 1976.
One change from the usual form of legislation of this kind is that the funds provided under this and the associated Bills generally are appropriated from the Consolidated Revenue Fund but in the case of grants for building programs and equipment purchases, provision has been made for the alternative use of the Loan Fund. The grants approved for these programs by the previous Government were expressed in June 1975 price levels and were on the basis that further grants would be provided to make allowance for subsequent movements in costs. Returning to the States Grants (Universities) Bill 1976, a total of $498m is available to the States for university purposes in respect of the year 1976, of which $447m is for recurrent costs and equipment purchases and $51m for building programs. These amounts make allowance for known movements in costs since June 1975. Further adjustments for cost movements to the end of the year 1976 will be required. I commend this Bill to the House.
Debate (on motion by Mr Lionel Bowen) adjourned.
Bill presented by Mr Viner, and read a first time.
-I move: That the Bill be now read a second time.
This Bill amends the States Grants (Universities) Act 1972-1975, to adjust the approved program of grants to State universities for the 1973-1975 triennium. The Bill takes account of known variations in costs over and above those which have occurred since the previous adjustments were made in similar legislation enacted in 1975.
Further adjustments for cost movements to the end of this triennial period will be required as statistical data become available. The Bill also gives effect to a decision of the previous Government not to proceed with projects for which contractual commitments had not been made, by deleting certain building projects and reducing the grants available to others. The Bill compensates the State of Queensland for fire damage to teaching hospital facilities of the University of Queensland at the Royal Brisbane Hospital. The additional funds provided by this Bill total $2 5 m bringing the funds available for State universities for the 1973-75 triennium to $ 1167m. I refer honourable members to my second reading speech on the States Grants (Universities) Bill 1976. My remarks there on interim financial arrangements apply to this Bill. I commend the Bill to the House.
Debate (on motion by Mr Lionel Bowen) adjourned.
Bill presented by Mr Viner, and read a first time.
– I move:
The purpose of this Bill is to provide for programs of financial assistance to the States for the funding of advanced education in respect of the year 1976. The Bill provides for grants totalling $296m for expenditure under the recurrent program and $56m for expenditure under the capital program. The recurrent program includes an allowance to cover cost increases since the June quarter 1975. In addition, the Bill provides for recurrent grants on a formula basis to assist in meeting the administrative costs of student residences and affiliated residential colleges of advanced education. The estimated expenditure on these grants in respect on 1976 is $lm. Both the recurrent and capital programs will continue to be supplemented until the end of 1976 in accordance with the established procedures to maintain their values against cost increases. In summary the total program for 1976 amounts to $353m. In the intervening period since the 1976 program was approved by the previous Government, a committee on post-secondary education in Western Australia, headed by Professor P. H. Partridge, has made a report to the State Government recommending that the School of Mines at Kalgoorlie should not continue at the tertiary level and that consequently the Kalgoorlie capital projects listed in Schedule 2 to this Bill under the heading of the Western Australian Institute of Technology ought not to proceed. We will therefore review the future of the projects following consideration by the State Government of the report of this committee.
I refer honourable members to my second reading speech on the States Grants (Universities) Bill 1976. My remarks there on the background to the funding arrangements for tertiary and technical and further education in 1976 apply to this Bill as do my remarks there on interim financial arrangements. I commend the Bill to the House.
Debate (on motion by Mr Lionel Bowen) adjourned.
Bill presented by Mr Viner, and read a first time.
– I move:
That the Bill be now read a second time.
This Bill amends the States Grants (Advanced Education) Act 1972-1975 to adjust the approved program of grants to the States for colleges of advanced education and nongovernment’ teachers colleges in the triennium 1973-75. The Bill takes account of variations in costs over and above those which have occurred since previous adjustments were made in similar legislation enacted in 1975. Further adjustments for cost movements to the end of this triennial period will be required as statistical data become available. The Bill also amends the Schedules to show changed names for some colleges and incorporates a number of approved transfers of funds within the recurrent and capital programs provided for under the Act. The additional funds provided by this Bill total $21m, bringing the funds available for colleges of advanced education for the 1973-75 triennium to $743m. I commend this Bill to the House.
Debate (on motion by Mr Lionel Bowen) adjourned.
Bill presented by Mr Viner, and read a first time.
– I move:
That the Bill be now read a second time.
The purpose of the Bill is to amend the States Grants (Technical and Further Education) Act 1974 so as to extend its period of operation from the present termination date of 30 June 1976 to 31 December 1976, and to provide additional funds to the States for the extended period. There have been some adjustments made to the grants to 30 June 1976 under existing legislation, involving an increase of $1.9m for recurrent expenditure and the deferment of $8.3 m for capital expenditure. For the period 1 July 1976 to 31 December 1976, $12.5m is available for recurrent expenditure and $ 1 7m is available for capital expenditure. The net effect of these measures is to vary the total funds available to the States from $ 107.8m over 2 years to $ 131m over 2Vi years. With the concurrence of honourable members, I shall have incorporated in Hansard a table summarising the various grants which are payable over the 2Vi-year period to the end of 1976, as set out in the Schedules to the Bill and, in relation to unallocated grants, in the principal Act.
-Is leave granted? There being no objection, leave is granted. (The document read as follows)-
– 1 will present to Parliament later in the session, a statement on payments made in the 1974-75 financial year under the existing legislation. I refer honourable members to my second reading speech on the States Grants (Universities) Bill 1976. My remarks there concerning the background to the Government’s decisions on the 1976 education programs apply to this Bill.
In considering amendments to the principal Act, the Government has sought to make only the minimal changes necessary to implement the 1976 programs in technical and further education. Section 13(c) of the Act gives the Minister powers to require information from the States as a condition of grants for recurrent expenditure. However, I can assure honourable members that information sought under this section would be limited to reasonable requests. I commend the Bill to the House.
Debate (on motion by Mr Lionel Bowen) adjourned.
Bill presented by Mr Eric Robinson, and read a first time.
– I move:
That the Bill be now read a second time.
The purpose of this Bill is to provide for the new superannuation scheme for Commonwealth Government employees, which I announced on 12 February 1976 would come into operation on 1 July 1 976. It is accompanied by the Superannuation Amendment Bill 1976 and the Defence Force Retirement and Death Benefits Amendment Bill 1 976, which I will introduce shortly.
There is a long history to the development of the new scheme. In October 1971, when a Liberal-Country Party Government was in power, the Treasury established a departmental committee to undertake a full investigation of the
existing superannuation arrangements. The committee’s report, which was tabled in the House of Representatives on 8 May 1973, canvassed in considerable detail the problems being experienced with the existing arrangements and, after examining various possibilities, recommended the introduction of a new scheme.
In May last year the Superannuation Bill 1 975 was introduced providing for a new scheme on the lines of, but somewhat more generous than, the scheme recommended by the Treasury committee. We, then in Opposition, recognised the urgent need for a new superannuation scheme but considered that the scheme provided by the 1975 Bill was plainly over-generous in the existing economic conditions. Our criticism was directed to three main areas. Firstly, we considered that the retiring age for a full governmentfinanced pension of 50 per cent of final salary pension after 30 years contributory service should be 65 and that retirement before that age should attract some reduction in pension. Secondly, we regarded as excessive the additional 0.5 per cent of salary government-financed pension for each year of contributory service before age 60 over 30 years but not exceeding 40 years. Thirdly, we considered that in the new scheme, in which members would be able to choose between additional pension purchased by their accumulated contributions or their accumulated contributions in a lump sum, there was no justification for updating annually that additional pension in accordance with consumer price index increases.
Subsequently, the Bill was amended in the Senate but the amendments were not accepted by the House of Representatives and the Bill was laid aside on 19 August 1975. On 30 October 1975, following representations by a number of contributors and some Public Service unions, my colleague, the honourable member for Curtin (Mr Garland), on behalf of the then Opposition announced a compromise solution involving three major changes in the Superannuation Bill 1975. This compromise solution provided the basis of the election commitment subsequently given by the Prime Minister (Mr Malcolm Fraser) to the Council of Australian Government
Employee Organisations and the Administrative and Clerical Officers’ Association. The changes to the scheme that I announced on 12 and 25 February last have been developed from that compromise solution and are incorporated in the new superannuation arrangements provided for in the legislation now being introduced.
The Changes in the Scheme
I do not propose to spell out in detail the changes that the Government has made to the scheme as put forward by the previous Government last year. Some changes, such as those providing that only the government-financed element of new pensions will be updated, making the full age retirement pension payable only on retirement at or after age 65, and reducing the additional pension for long contributory service from 0.5 per cent to 0.25 per cent of salary for each year of such service beyond 30 years up to 40 years, have significantly reduced the cost of the new scheme. Special attention has been given to the position of women in the scheme.
Some aspects of the scheme have been simplified and worthwhile administrative savings will be achieved as a result. A case in point is limiting to one, the options that were previously to be available in respect of the additional pension financed by members’ contributions. Other changes will achieve a more consistent and better balanced scheme.
The Provisions of the Bill
The construction of the Bill and the two accompanying Bills, and their main provisions, are explained in some detail in the explanatory memorandum that has been circulated to honourable members. The memorandum also includes brief explanations and comparisons of the present superannuation arrangements and the new scheme, and information on costs.
The New Scheme- Contributions
The contribution arrangements for the new scheme have not been changed from those provided in the 1975 Bill. A new contributor and contributors transferred from the present Provident Account will be required to make a basic contribution of 5 per cent of salary and will have the option of contributing up to a further 5 per cent in supplementary contributions on a voluntary basis. Special arrangements will operate for contributors transferred from the present pension scheme. Those whose present contributions amount to more than 5 per cent of salary will have the option of paying, in addition to their basic contributions of 5 per cent, supplementary contributions not exceeding their present contributions expressed as a percentage of salary.
For younger contributors whose present contributions amount to less than 4 per cent of their salary in contributions, the move to the 5 per cent basic contribution rate will be in stages. The change in the contribution basis will mean an immediate increase in the contributions presently being paid by more than half the contributors to the existing pension scheme.
For new contributors the scheme will provide a government-financed pension of 50 per cent of final salary on retirement at age 65 after 30 years of contributory service. Each year of contributory service beyond 30 will attract an additional pension of 0.25 per cent subject to a maximum pension of 52.5 per cent of final salary on retirement at age 65 after 40 or more years of contributory service. Contributory service of less than 30 years will attract a lower pension. For retirement after age 60 and before 65 the pension will be reduced by 2 per cent of the pension for each year or part year that retirement occurs before that age. This will provide a government-financed pension on retirement at age 60 of 45 per cent of final salary after 30 years contributory service and 47.25 per cent after 40 years contributory service.
Contributors to the present pension scheme and the Provident Account will not be required to complete 30 years contributory service to qualify for the 50 per cent government-financed pension on retirement at age 65. Pension scheme contributors will continue to be subject to the more beneficial service provisions of their present scheme, that is, 20 years contributory service for entrants on or after 14 December 1959 and no qualifying period for entrants before that date. The qualifying period for the 50 per cent pension at age 65 for Provident Account contributors will be 20 years.
If the age 60 units held by a present pension scheme contributor would have provided a better Government financed pension than will be available under the new scheme on retirement before age 65, a pension supplement in respect of those units will be added to the Government financed pension payable at retirement. Provident Account contributors will be able to elect, on retirement, to receive, in lieu of the new scheme benefits, the lump sum benefit that would have been payable had the Provident Account arrangements continued to apply.
At retirement a member will also be entitled to additional pension not exceeding 20 per cent of final salary, based on the member’s accumulated basic and supplementary contributions. If the accumulated contributions are more than sufficient to provide a 20 per cent additional pension the excess accumulated contributions will be paid to the member. The additional pension will carry with it reversionary pension entitlement for a spouse. The member will have a once only option, exercisable within 3 months of retirement, to convert the whole of the additional pension and reversionary entitlement into the equivalent lump sum.
Like the present pension scheme, the new scheme will provide comprehensive cover against the invalidity retirement or death of a contributor before age 65. The benefit will be determined on the basis of prospective contributory service to age 65 and will be in the form of a Government financed pension together with additional pension that can be exchanged for the member’s accumulated basic contributions if the member or the beneficiary so desires. Provision is made for a partial invalidity pension to be paid when an invalidity pensioner is re-employed on a lower salary or when a contributor’s status and salary are reduced on medical grounds.
Spouses’ benefits will be available to a wider range of persons including, under certain conditions, de facto spouses and the spouse of a marriage after retirement. The standard benefit for a spouse will be 67 per cent of the member’s pension and the pension will not cease on remarriage. Children’s and orphans’ pensions will also be related to the level of the member’s pension.
Persons of lower medical standard on entry who, under the present arrangements, would be required to join the Provident Account, will come under the new scheme as will those members at present contributing to the Provident Account. There may be some reduction in thennew scheme benefits on medical grounds if they retire on invalidity or die before completing 20 years of contributory service.
The scheme has been designed to provide appropriate benefits if a contributor’s conditions of service, either now or in the future, permit early retirement before age 60. Such early retirement pension is the age 60 retirement pension according to actual contributory service reduced by 4 per cent of that pension for each year or part year that retirement occurs before age 60. Provision has also been made so that, as and when appropriate, membership of the scheme can be extended to part time employees.
Preservation of Superannuation Rights
In the new scheme the qualifying period for preservation of benefits will be 5 years instead of the 20 years qualifying period provided in the present legislation. This significant reduction in the qualifying period will be of particular assistance to women who interrupt their careers for reasons such as child rearing.
Updating of Pensions
The Government financed element of pensions that become payable under the new scheme will be adjusted in July each year by the formula one times the percentage increase in the Consumer Price Index in the preceding 12 months, March quarter to March quarter. Existing pensions that will continue to be paid under the present Superannuation Act will be adjusted by the same formula applied to the full pension.
Administration of the new scheme, other than investment and management of the Superannuation Fund, will be the responsibility of a Commissioner for Superannuation to be appointed by the Governor-General. Investment and management of the fund will be the responsibility of an Investment Trust whose members will be appointed by the Governor-General. The Trust will be comprised of a full time chairman and 2 part time members, with appropriate experience in the investment or management of moneys. One of the part time members will be a contributor or pensioner selected after consultation with contributor and pensioner organisations. The investment powers relating to the fund are wide and include investments such as shares and real property.
Provision is made for the reconsideration of decisions by the Commissioner for Superannuation where sought by a person affected by a decision and for application by the person to the Administrative Appeals Tribunal for review of a decision confirmed or varied by the Commissioner. For this purpose one of the nonpresidential members of the Tribunal is to be a contributor or a pensioner.
Introduction of The New Scheme
Introduction of the new scheme will require a division of the assets of the Superannuation Fund as at 30 June 1976 between pensioners and contributors. This is covered in general terms only in the Bill and will be dealt with in more detail in regulations.
The complex nature of the present superannuation arrangements has caused many administrative problems and in February, when contributions to the pension scheme and Provident Account were frozen pending the introduction of the new scheme, the work of the Australian Government Retirement Benefits Office was very much in arrears. These arrears are now being overtaken but it will be some time before the division and allocation of. the fund as at 30 June 1976 can be completed. Suitable provision will be made in the regulations for interim arrangements that will apply to persons retiring during the period of transition.
Turning now to costs, on the basis of contributor and pensioner data as at 30 June 1974 and using the assumptions adopted by Mr G. L. Melville and Professor A. H. Pollard in their 1974 report, a comparison of capital values of benefits under the present pension scheme and Provident Account with capital values of benefits under the new scheme shows an overall increase of 1 per cent. The comparison illustrates the marked improvement under the new scheme in the position of those existing contributors who, for medical reasons, have been required to be members of the Provident Account. On the other hand, there is some decline in the capital values for existing pensioners and existing pension scheme contributors. This decline reflects the long term effect of the change in the updating formulae.
It is estimated that, if the Government were to fund its liability by making contributions at the same time as employees, the Government contribution for new contributors entering the new scheme after 1 July 1976 would be 18.8 per cent of the salaries of these contributors. The corresponding figure for the present pension scheme and Provident Account combined is 19.3 per cent. Net expenditure from the Consolidated Revenue Fund in 1976-77 on account of the new scheme is expected to be about $3m less than if the present pension scheme and Provident Account were to continue.
The comparison of capital values and other costing information are contained in the explanatory memorandum that has been circulated to honourable members.
The Superannuation Amendment Bill 1976, another Bill, amends the Superannuation Act 1922-1974, which will be kept in force in part to provide continuing authority for the payment of existing pensions. It extends to spouses’ and children’s pensions that are payable or may become payable in the future under that Act, the higher reversionary benefit percentages provided in the new scheme and applies also the wider eligibility provisions of that scheme.
Provision is also made for the freezing of contributions to the present schemes as at 4 February 1976 and the suspension of certain options in the present legislation from 13 February 1976, pending introduction of the new scheme. These measures were announced by the Government in February this year.
The Superannuation Amendment Bill also provides special superannuation arrangements for persons who transferred from State and private employment as a result of the Commonwealth Government’s assuming additional responsibilities.
The Defence Force Retirement and Death Benefits Amendment Bill 1976 makes a number of essential machinery amendments to the principal Act to take account of changes being effected by the Superannuation Bill and to ensure that arrangements already in existence continue in force. They .deal with persons whose contributions to the superannuation scheme have been deferred on their becoming eligible members of the DFRDB scheme, the preservation of rights provisions as they relate to persons transferring from one scheme to the other and, in accordance with past practice, the ex-officio appointment of the Commissioner for Superannuation, in lieu of the President of the Superannuation Board, as chairman of the DFRDB Authority and the DFRB Board.
The opportunity has been taken also to include in the Bill some formal and miscellaneous amendments, including provision to allow applications to be made to the Administrative Appeals Tribunal for the review of decisionsmade by the Defence Force Retirement and Death Benefits Authority.
In conclusion the introduction of this Bill and the accompanying measures honours a commitment made by the Government to its employees late last year. The Australian Government Employees Combined Superannuation Coordinating Committee, which is representative of both contributors and pensioners, has asked the Government to proceed with the scheme. It has been no easy task to mould the new scheme into the form in which it is now presented. In this connection I pay tribute to the tremendous contribution that my predecessor, the honourable member for Curtin (Mr Garland) made to the development of the final scheme. Superannuation is a complex issue. My colleague was untiring in his efforts in getting to understand the present scheme and its problems and in seeking to find a solution that might reasonably satisfy the aspirations of the Government’s own employees while still giving proper weight to the interests of the nation as a whole.
The covering legislation is extensive and complex and has been produced under considerable pressure. Should any shortcomings emerge as the new scheme gets into operation, the Government will, if it is appropriate, take action to remedy them. The new scheme will apply immediately to around 240 000 existing contributors, and perhaps another 60 000 Commonwealth Government employees, not at present in a superannuation scheme, will be eligible to join. There are, however, around 20 other superannuation schemes applying to civilian employees within the Commonwealth Government sector. In the interests of mobility, even-handed treatment of employees and greater efficiency in the area of superannuation, the Government intends in due course to move in the direction of bringing in to the new scheme, civilian employees at present covered by other Government schemes. I commend the Bill to the House.
Debate (on motion by Mr Hurford) adjourned.
Bill presented by Mr Eric Robinson and read a first time.
– I move:
That the Bill be now read a second time.
As foreshadowed in my second second reading speech on the Superannuation Bill 1976, I now introduce the Superannuation Amendment Bill 1976 that makes certain necessary changes to the Superannuation Act 1 922-1 974 consequent upon the introduction of the new superannuation scheme for Commonwealth Government employees, and some other changes. I commend the Bill to the House.
Debate (on motion by Mr Hurford) adjourned.
Bill presented by Mr Eric Robinson, and read a first time.
– I move:
That the Bill be now read a second time.
As foreshadowed in my second reading speech on the Superannuation Bill 1976, I now introduce the Defence Force Retirement and Death Benefits Amendment Bill 1976 that makes certain necessary changes to the Defence Force Retirement and Death Benefits Act 1973-1975 consequent upon the introduction of the new superannuation scheme for Commonwealth Government employees, and some other changes. I commend the Bill to the House.
Debate (on motion by Mr Hurford) adjourned.
Debate resumed from 4 March, on the following paper presented by Mr Lynch:
Australian Economy- Ministerial Statement, 4 March 1976 - and on motion by Mr Sinclair:
That the House take note of the paper.
-In his major statement to the House on the economy and economic policy the Treasurer (Mr Lynch) has presented, it seems to me, a very disturbing document. His statement is dominated by presumptions of a largely ideological nature. To cite just one at this stage, there is the assertion that a high level of Government spending and large deficits are the source of our problems. Although the Treasurer, and apparently his colleagues in the Liberal-National Country Party Government believe that tackling these two phenomena will solve the problems, no sound justifications are given for the adoption of the basic assumptions. It appears rather that facts and arguments have been distorted to fit in with the assumptions. Further, although the Treasurer has spelled out a number of measures and impressed upon us the great necessity for their being carried out, no discussion whatsoever of how these measures will indeed solve the problems confronting us has been presented in the statement which is the subject of” this debate.
The 1975-76 Budget of the Labor Government was framed to contain a sufficient policy mix to enable the Australian economy to move out of recession without sparking off widespread inflation. We do not and did not pretend that such a recovery could be anything but slow. Government expenditure was contained at a level which was sufficient to prevent erosion of many benefits the Australian people had reaped under the Labor Government but which gave the private sector room to expand. The size of the deficit merely indicated the degree of slack, the degree of unemployed resources present in the economy. With the recognition that a true Australian economic revival was dependent on the world revival- signs of which had already emerged- the 1975-76 Budget prepared the groundwork for locking in on the world recovery. Measures already in the pipeline when the Labor Government was removed from office- for example, tax cuts already announced and measures to lower interest rates- were designed to allow for a steady growth in consumer demand and to make investment borrowing resulting from demand stimulus more attractive.
There is evidence that the strategy of the Labor Government was beginning to work. Perhaps the best sign that indeed a recovery was underway, induced by the last Budget, came from the reaction of the present Minister for Employment and Industrial Relations (Mr Street) to the January and February unemployment figures. The Minister deliberately played down signs of a firming in the labour market, preferring to ascribe a fall of 40 000 in the number of unemployed to the vagaries of the statistical process of seasonal adjustment. A further examination by the Minister of the process of seasonal adjustment will reveal that as the adjustment procedure is based on historical levels of unemployment, seasonal adjustment at this time of high unemployment actually understates falls in unemployment. No doubt the Minister’s reluctance to join with the Australian newspaper in acclaiming ‘thousands quit dole queues’ derives from his realisation that dominant influences on present activity and employment levels are the fiscal and monetary actions of four to six months ago-that is, the measures taken in the 1975-76 Labor Budget, not any policies which have been brought in by the new Government. Other indicators released for December and January, among them new vehicle registrations, tend to support the contention that the predicted recovery was indeed underway. As one journalist, Ken Davidson, in the Melbourne Age so succinctly put it:
Hayden had the answers after all.
However, the chances that the Australian people would benefit from the policies of the Labor Budget have severely diminished since 13 December. The world recovery, which becomes more and more evident as each new set of indicators is released, becomes more and more remote from the Australian people following each successive action of this Government in the area of economic policy.
The chances for economic recovery in this country are being sacrificed upon the ideological presumptions I alluded to at the beginning of this speech. These presumptions emanated from a philosophy which appears to overwhelm this Government’s every action. In the Age of 4 March one newspaper columnist describes this philosophy as being based on an idealised society of the past with a market system catered for the requirement of all and the need for government provision was minimal. However the basic flaw of such a philosophy is that in reality only the privileged few can exploit the opportunities, enjoy the freedom and make the choices they cherish. Thus we come to the basic differences in philosophical stance between the Government on the one hand and men and women who support the Labor Party on the other hand. Our Party feels that opportunities open to the privileged few should be open to all. The provision of public goods and the existence of a strong, positive public sector appear to be anathema to the leaders of the Government. When the philosophy upon which the assumptions of the Treasurer are made is translated to a political reality, it involves the decline of the public sector, the decline of that sector which provides those things the market will not provide. I name some of them: Aid to the aged and aid to the sick, the young and the underprivileged. The Government has conducted a campaign of myth and half-truths to convince the Australian people that they are being harmed by the efforts of the public sector to improve the quality of their lives.
Prior to the last election the electors were presented by the Liberal Party and National Country Party with promises of return to the stable days of the 1950s and 1960s. They painted a picture of communities based on sturdy selfreliance. No attempt was made to explain, as the Treasurer in his statement does not, that changes in the international scene have rendered a return to those years an impossible dream. No attempt was made to explain that sturdy self-reliance also meant standing alone in a complex world which most people do not fully comprehend. The Australian people were misled into voting this coalition into power. They are being misled by the Liberal Party-National Country Party coalition now that it is in power.
One of the major vehicles the Government has used to confuse and mislead the public has been discussion of the Budget deficit. A campaign was begun by the Treasurer when as Deputy Leader of the Opposition he attempted various extrapolations of monthly figures to obtain a value for the deficit for the entire year. That campaign has continued. Simplistic interpretation of what this deficit meant in terms of economic management was made to- confuse the people further. The present Prime Minister (Mr Malcolm Fraser) played his role in this campaign through his use of the analogy between public and private debt- a ruse described in basic public finance texts as being used by unscrupulous politicians to mislead electors. Regrettably I find the right honourable gentleman still persists in the use of such analogies. Bland statements that worldwide recession was somehow caused by all countries running deficit Budgets were presented to the people as absolute fact. No recognition was made of the school of economic thought which suggests that the world-wide recession was caused by the simultaneous slamming on of the brakes by all the major industrial countries reacting to inflationary problems. No admission was made of the possibility that only large government outlays prevented a recession of depressing magnitude when all these countries went through a trade cycle decline simultaneously for the first time since the 1930s.
In short, no notice is taken of such authorities as Mr Van Lennip Secretary-General of the Organisation for Economic Co-operation and Development, who is an objective, impartial observer of these events, and of most other important objective observers. Distortions and halftruths put forward as economic truth to validate an ideology, temporarily politically attractive, namely the decision to reduce the role of the public sector, continue to be seen in the Treasurer’s statement. I will instance a few examples of how the Treasurer has continued with this ideology. In his statement the Treasurer, after speaking about spending increases and the deficits in 1974-75 and 1975-76, says:
The results of this abandonment of all sense of budgetary responsibility led, in the ultimate, to a drying up of demand in the private sector and a quite devastating loss of confidence. Consumer spending fell away. Business investment slumped. Production fell. Job opportunities vanished and unemployment soared.
It is of course entirely false to suppose that the big Budget deficits of 1974-75 and 1975-76 led to slump in demand and output. The economy moved swiftly into recession from about the second quarter of 1974. The movement was well under way by the end of the 1973-74 financial year- a year in which the deficit was a very low $293m. Unemployment rose strongly during 1974, reaching 235 000 seasonally adjusted by December 1974. Consumer spending slumped in the September and December quarters of 1974. The 1974-75 Budget was framed with a modest deficit of about $750m. But in response to the downward movement in the economy a range of stimulatory measures were taken in late 1974 and early 1975. The then Prime Minister’s statement on 12 November 1974 announced income tax cuts from 1 January 1975 and cuts in company tax. Special measures were announced at about that time to assist the housing and wool industries. Sales tax on cars was sharply reduced for the early months of 1975, and so on. The big increase in the deficit in 1974-75 arose mainly from these and other responses to a depressed economy; it was not in any sense a cause of the movement into recession.
I give a second example of distortion in this Minister’s statement that we are debating. The Treasurer, continuing his theme, speaks of the large number of wage increases which occurred during 1974-75. He then says:
As a result of the uncertainty thus created in respect of future prices and incomes, consumers stepped up their savings- the squirrelling phenomenon.
It is a complete distortion to portray the increase in the savings ratio as something which occurred as a result of the acceleration of wage and price inflation in 1974-75. Recent savings ratio figures are:
The increase in this ratio has clearly been going on for some time, and the increase in the ratio during 1974-75 was smaller than that in the two preceding years- 2 percentage points as against 2.3 per cent and 2.8 per cent. In recent quarters the trend seems to have been reversed. A third example of the distortion is contained in the Treasurer’s speech. He ascribes the falling off in business investment to 3 factors: A reduction in expected returns from investment; their increased riskiness and the drying up of internal cash flow. While there is clearly some importance in each of these factors, it is staggering that he leaves out the factor that almost all economists would mention immediately as the main cause, namely the decline in output and the fact that many companies are operating at 15 per cent- 20 cent below capacity. A fourth point is that part of the reason for leaving this factor out seems to be that he wants to portray- he does so elsewhere in his statement- the decline in investment as one of the causes of the slump rather than as largely a response to the slump in output. Recent quarterly seasonally adjusted constant price figures for private business investment, excluding the dwelling sector, from the first of the four quarters in 1973 to the last of the four quarters in 1975, are: 819, 859, 890, 968, 963, 935, 924, 867, 923, 897 and 817.
The major point is that the first signs of real weakness in these figures is the December quarter of 1974, by which time unemployment was over 200 000, and that, leaving aside the special June figure, the main decline has been in 1 975, particularly in the most recent quarter. The decline in investment cannot be regarded as having caused the level of activity to slump sharply. I repeat: These are distortions. In fact, these serious distortions of recorded facts are deeply disturbing. How can we expect policy to be soundly based if elementary facts are represented in the way that I have outlined?
To return to the issue of the deficit and the unreasoned approach this Liberal-National Country Party Government has taken to it, let us look at some of the logic employed by the Treasurer to condemn the use of high levels of deficit spending by government to offset the effects of recession. A good example of the prevailing logic comes in the treatment of Keynesianism in the Treasurer’s speech. This is introduced on page 10 of the speech. He says: . . . we hear it argued that that -
That is a cutback in government spending and the deficit- . . . will not contribute to economic recovery but on the contrary, will simply serve to depress activity still further
This proposition, which seems to be obviously true, is described as- I quote him again’hopelessly outdated’. The only justification the Treasurer offers for this claim consists of 3 international quotations that honourable members will remember. On page 11 of his speech President Ford is quoted as saying that accelerating inflation causes increased unemployment. The International Monetary Fund is quoted as saying that any handling of the current recession which added to inflation would be short lived. Mr Harold Wilson, the British Prime Minister, is quoted as saying that massive reflation in Britain at present would be inflationary and would lead eventually to further unemployment. None of these quoted remarks bears at all on the proposition that the Treasurer claims is, to quote him, ‘hopelessly outdated ‘-that cutting back on spending and the deficit will further depress activity. This is not surprising, for by page 12 the Treasurer is asserting that it is true that ‘looked at purely in a short run context’ cutting back on spending and the deficit will depress activity in the government sector and in the private sector as well. This is now asserted by the Treasurer to be a ‘cost’ which has to be borne if ‘big government’ is to be eradicated. On page 13 it is a ‘hard fact’ that the cutting back policy will result in a lower level of economic activity than otherwise might have been the case. We have turned the full circle in 3 pages of the Treasurer’s statement.
On whatever shaky ground the Treasurer’s conclusions are based- I have illustrated in detail how shaky is the ground- they have resulted in the misguided package of fiscal and monetary policies implemented by this Government since coming to power. The announced aim of these policies is to transfer resources to the private sector from the public sector and to stimulate private investment. In essence the Government has slashed public sector expenditure and moved to limit the growth of the money supply. Obviously the Australian Labor Party, realising the role public expenditure must play in taking up the slack left by the private sector in times of recession, rejects out of hand the need for arbitrary cuts. The 1975-76 Budget slowed the growth of public expenditure and prepared us for a time of consolidation, but the amounts of public spending in that Budget were necessary if economic revival was to take place.
The time is now ripe to examine the effects that the announced government spending cuts will have. The leaders of the Government speak with pride of managing a $300m cut in public expenditure for the rest of the financial year. They have never given full details of that $300m, but let us assume that there is a cut of that magnitude. The fact that this saving will be made at the expense of pensioners, children and the sick is blithely ignored. But even in the Government’s talk of the cuts there is evidence of equivocation. The Sydney Morning Herald of Monday, 15 March, in questioning the Prime Minister’s extrapolation of these savings over a full year as $ 1 ,000m, used the following words:
This is nonsense, as even a cursory examination of the cuts demonstrates.
Let us examine in detail some of these so-called totally necessary cuts. Nowhere is the overriding influence of the Government’s ideological preoccupations more manifest than in its attitude to foreign aid. This country has a very favourable balance of payments situation, yet cuts are made in amounts .of money spent overseas. The effect of cuts in foreign aid on the level of domestic expenditure will be totally insignificant, but the effects on the lives of those who were to be the recipients of this aid will be catastrophic. This Government has thought totally in terms of ideology to the effect that the public sector must be cut back. No thought has gone into the effects these cuts have on people. The totally arbitrary nature of this Government’s approach to cutting back public expenditure should be condemned even by those who misguidedly feel that this is the time for restraint and cut-backs. It is all so unnecessary and unjust.
On the domestic front, pensioners will suffer from delays in pension rises and from the abolition of funeral payments; the sick no doubt will suffer the prospect of paying extra for medicine. But the assault does not end there. Young children will suffer from cut-backs in the Children’s Commission programs, and so will the parents who needed those childhood services desperatelyparents who can least afford to do without such services. The total misunderstanding which the leaders of this Government have of the links between the private and public sectors becomes tragically evident when examining cuts announced in Public Service construction contracts. A large section of the construction segment of the private sector is dependent on government work. No other building demand is likely to increase in the foreseeable future. The monetary policies of this Government have virtually ensured that. These decisions must lead to vastly increased unemployment.
A lot of noise has been made about this Government’s determination to improve efficiency in the public sector. It has instituted a special committee to make recommendations on this subject. One of the directives given to this committee is that it look at ways of returning administrative functions to the States where appropriate. One can readily understand the difficult decisions that face the chairman of this committee as he attempts to justify giving additional responsibilities to State government bureaucracies, one of which he found not so long ago was incapable of performing the functions it was already required to perform. I refer to Sir Henry Bland’s examination of the Victorian State public sector. Further to this point, it appears difficult to follow the Government’s rationale in advocating power transfer from the Australian Government to the State governments as a means of reducing the level of bureaucratic control over the lives of individuals. As has been pointed out by my colleague, the honourable member for Lalor (Dr J. F. Cairns), this power juggle does nothing to reduce overall restraints on personal liberty. A far better method of increasing individual participation in the community would be via the Labor Government’s community welfare centre program- the Australian Assistance Plan. That program contained 2 necessary facets of community welfaregovernment guaranteed services and local decision-making. I spoke at greater length on this subject when debating the Financial Agreement Bill 1976 2 days ago.
Continuing with this theme of the impact of the Government cut-backs on individual members of society, I bring to the attention of the House the stupidity of arbitrary cut-backs as a method of increasing efficiency. I do not rely j just on my judgment. I may be biased. Let me draw attention to the editorial in the Canberra Times of Thursday, 12 March. While admitting the slight hope that cut-backs and sackings may, to quote the editorial, ‘indeed stimulate greater efforts by those remaining’- a proposition which I would see as questionable- the editorial points out that ‘on the other hand the effects on morale may prove counter-productive’. This latter alternative appears to be what is happening. Times for the supply of new and transferred telephones and for the processing of passports, to mention just 2 matters, have lengthened considerably since the announcement of the Government’s arbitrary cuts. These things are not significant in themselves, but are symptomatic of the misplaced thinking of this Government and the emphasis on ideologies and slogans to the detriment of the needs of people. The Labor Party in no way subscribes to the view that the Public Service is perfectly efficient. Our establishment of the Royal Commission into Australian Government Administration while in government attests to that. However, we believe that the problems of the Public Service derive not from the fact that it is public but from the fact that it is, and by function must be, a large organisation. With the Royal Commission due to report in April of this year, surely that would have been the time for any re-evaluation.
One of the sadder aspects of this Government’s attitude to expenditure programs has been the way it has moved to reward its own sectional supporters for previous service in giving their votes. The phosphate bounty stands out as an example of this, as does the investment allowance. The amount of money spent on the phosphate bounty would be applauded if it were used for disadvantaged farmers, but this Government has given the most to those who least need it.
– Everybody needs it.
-The bounty has been restored under the pretext that it is an incentive to encourage the use of fertiliser and hence to increase production. The New Zealand experience and the Bureau of Agricultural Economics submission to the Industries Assistance Commission suggest that the bounty will never achieve this end. Why do not members of the National Country Party, who are so clever in their interjections- I use the word ‘clever’ in a cynical sense- stand up and demand that this money be allocated to those who really need it?
As I have indicated, another clear example of the Government’s cynicism about spending cuts is the investment allowance. This policy, we presume, is the positive implementation of the Government’s declared desire to redirect resources from the public to the private sector. It is a handout of the revenue forsaken variety, a measure to foreshadow what the Treasurer once described as an investment-led recovery. Thankfully in his recent statement we are debating here the Treasurer has lessened the intensity of his search for such a creature. The patent absurdity of using such a measure to evoke recovery is highlighted in the latest Quarterly Survey of Manufacturing Industry released by the Department of Industry and Commerce a couple of days ago, in which it is stated:
The low level of new capital expenditure has been a feature of these surveys for two years. A continuance of this situation is consistent, however, with a low level of capacity utilization and overtime worked. It is reasonable to suggest that new capital expenditure will only respond to a significant and sustained increase in demand.
The Labor Opposition contends that random government expenditure cuts, increases in interest rates, cries of doom from the Treasurer and his Prime Minister and a policy of deliberately created unemployment will not lead to this increase in demand.
This Government’s plans for industry do not appear to contain programs to cope with the major problems identified in the Jackson Report. In fact, Mr Gordon Jackson at the recent Metal Trades Industry Association seminar identified symptoms of the deep-rooted malaise of Australian manufacturing industry as being the problems of people-the problems which
Galbraith identified as arising from public poverty. This Government’s policies of running down public services will only exacerbate the problems.
I have dealt at some length with the illfounded fiscal policies and now turn my attention to their monetary measures. These monetary policies of this Government, unless quickly modified, seem certain to deny the Australian people the solid, if slow and steady, economic recovery that the last Labor Budget planned to give them. As pointed out earlier in this speech, the strategy of the 1975-76 budget was to include measures opening the way for lower interest rates in 1976. On 22 January the Government announced a number of monetary measures. At first glance these appeared consistent with the strategy of the Labor Budget with drops in the overdraft interest rate and yields on Treasury notes. However, the accompanying measures, the launching of the Australian Government Savings Bond at 10.5 per cent and the raising of the LGS ratio from 18 per cent to 23 per cent, have effectively prevented this drop in interest rates and indeed brought us to the brink of severe tightening of credit- a credit squeeze. The Treasurer has sought to deny this and presents 3 points in support of his contention. Firstly, bank lending is continuing at virtually unchanged levels; secondly, their expectation is for an 1 1 per cent to 13 per cent growth in M3 in the first half of 1976; and thirdly the Government will ensure that the system has sufficient finances in the seasonal period.
Let me deal with these 3 points. The first of these points is irrelevant, given that these things take time to develop. The assurance in the third is welcome, but does not remove the fear that the Government has misjudged the situation. I suggest that today’s news in Queensland is another example of how the Government may have misjudged this situation, although I am quick to point out that I realise that the particular trouble is administration in Queensland building societies. This makes the second the crucial point. It is widely agreed that in seasonally adjusted terms, M3 is likely to decline in February- the trading bank figures, about half of M3, released last Tuesday, show a sharp fall in February, a month in which there is normally a rise- and to increase only moderately in March so that in the 3 months to March, M3 will show little or no growth in adjusted terms. So the Treasurer’s figure of 12 per cent implies an annual growth rate of M3 of 20 per cent to 25 per cent in the final quarter of 1975-76. While the outcome depends on such factors as the first Budget deficit and balance of payment figures, it is a brave man who would forecast such a rapid resurgency as the Treasurer has forecast. It would appear now that the first half of 1 976 will see M3 growth at an annual rate of about 8 per cent and with inflation continuing at about IS per cent this implies a significant tightening of financial conditions throughout the economy.
The impact of the Treasurer’s misjudgment renders artificial the Prime Minister’s recent reply to a question in this House on interest rates when he explained how his Government has led the way for a fall in interest rates. The recent dramatic fall in bank advances emphasizes the fact that artificially low interest rates are useless in a time of Government attempts to severely tighten liquidity. I and other Opposition speakers pointed out during a recent urgency debate on the economy that all the measures taken by this Government have imperilled- severely jeopardisedthe recovery planned in the 1975-76 Budget, which plans were seen to be working in spite of the hampering of the constitutional crisis. If there was some point to it, the hardship these measures will cause- indeed, are causing- would possibly be acceptable to some people. But there is no point to it.
The Treasurer continually asserts that the control of inflation is his central concern, and that this is necessary for a soundly based recovery. But nowhere does he spell out what his policy is for reducing inflation. His remarks about the recovery are sometimes unencouraging. At page 2 1 of his ministerial statement he said:
Hopefully- though less so now in the light of the recent decision in the national wage case- there will be some recovery in demand, production and employment in 1 976.
Even these remarks are contingent on- and this again is set out on page 2 1 of his speech: … a continuing and discernible moderation in the rate of wage and price increase during that time.
But on page 24 we find that the Treasurer said:
There is now a very real danger that 1976 may see a further entrenchment of wage/cost pressures as a result of the 6.4 per cent increase.
Yet we find that the Treasurer on page 23 said:
The Government has not yet determined, in detail, the approach it will take on future occasions in the wage-fixing area.
The chances that the Liberal-National Country Party Government will be able to gain the support of the unions for wage restraint have been almost irrevocably impaired because of its deceit and stupidity at the last national wage case. This is an example of another election promise which the Fraser Government found it impractical to keep; without any perceptible twinge of conscience, the promise was broken. The wage and salary earners of this country, under the influence of the Labor Government, who backed the indexation process by their restraint, had already begun playing their part in the economic revival. In the calendar year 1975 real wages actually fell; average weekly earnings rose by 12.5 per cent while prices as measured by the consumer price index rose 14 per cent; 1975 was the only year since the Second World War, apart from 1956, in which wages rose less than prices. That shows just how the wage and salary earners had played their part. In view of the hostile environment being created by this Government it is folly to expect wage and salary earners to continue to co-operate in this way although the country desperately needs their co-operation.
Moves by this Government to trifle with indexation through a one-way manipulation of the CPI will further break down the tenuous relationship between employee organisations and government. The Prime Minister will find to his cost, as did a Conservative Prime Minister in Great Britain, that the voters will not permit unbridled and unnecessary attacks upon the union.
In conclusion I state that the Treasurer has throughout his statement stressed the central nature of the problem of inflation, but the statement contains no strategy to defeat it. He admits, in passages quoted earlier, that reducing the deficit and the growth of the money measures supply will not only curb inflation, for given all these measures, he is still worried about ‘a further entrenchment of wage-cost pressures in 1976’. In fact inflation at more than 13 per cent now seems likely in 1976 and he proposes no measures to avoid such a development, and the Government is proposing no viable counter measure. With the Treasurer himself admitting the possibility of no recovery in 1976 the outlook is, to use his own words, sombre.
The Opposition does not pretend that the answers to the problems confronting us are simple. But the Labor Party rejects out of hand the outdated ‘Scrooge-suffer-mentality which appears to beset the Government’s thinking. The prospect of many ordinary people being substantially disadvantaged on the off chance that the Government’s measures will in a magical way cure the economy of its ills, is not a pleasant one. I would stress again that the Government is unwilling or unable to inform this Parliament as to how the measures it has taken will bring about a soundly-based recovery based on controlling inflation. This statement leaves us in the dark.
In short, if the Government revoked all policy decisions it has made since coming into office and allowed the policies of the last Labor Budget to run their course, with some inevitable adjustments to the money supply in the light of unfolding events, the Australian people could yet enjoy the fruits of the worldwide recovery which threatens to escape them or at least threatens to be postponed. If the Government could remove itself from its ideological straitjacket, the prospects for the Australian economy would be vastly improved.
-Once again we have heard this load of rubbish from the Opposition spokesman on economic matters, the honourable member for Adelaide (Mr Hurford). It takes us no further and repeats over and over again a single theme, the Government’s socalled ideological preoccupation.
– It rants and raves about the Government’s so-called ideological straitjacket. It ill becomes the honourable member to speak of an ideological straitjacket. It is the ideological straitjacket of the honourable members opposite that has got them where they are today. The honourable member talked of the 1975-76 Hayden Budget as the potential saviour of the nation. It was the third of a series of disastrous Budgets which brought this country to a position of the highest inflation, the highest unemployment for many years , and to a stagnation in production. The actual production last year and the year before was lower than for the year before that. That is the position which emerged from the policies of those honourable members who now sit opposite. There is a difference between their ideological straitjacket and our ideological position. We are proud of our ideological position. Our objective is to achieve a genuine and effective partnership between government and industry, the private sector comprised of Australian business large and small, with free enterprise and initiative making the running in that sector. Our objective is to get this partnership working to get Australia moving again and in this way to achieve an enlarging of the whole national cake so that there is the genuine possibility of more for everyone; more for our national and social purposes and more for individuals. As against that, the ideology that you practise is the socialist purpose, that the government is paramount, that the government should do all, that the government can do it best and if the private sector- its prosperity and its jobs get in the way it is expendable. That is your approach.
Mr DEPUTY SPEAKER (Dr Jenkins)Order! The honourable member for Berowra knows that he should address the Chair.
– I am not addressing my remarks to the honourable member for Adelaide but to the Oppostion
– There are two of them.
-There are so few of them present that I tend to focus on the honourable member for Adelaide. The honourable member said repeatedly that the Government’s objective is to damage the public sector. That is not its objective. Its objective as I have said, is to foster an effective partnership between the public sector and a prosperous, thriving non-government sector. What the Opposition cannot and will not see is the destructive impact of the course on which the economy was set during the years in office of the Australian Labor Party Government, a course which brought low the whole economy and gave the public sector a larger share but of a diminished cake.
– It brought the economy to its knees.
– It brought the economy to its knees, with 250 000 people unemployed and rampant inflation. Honourable members opposite talk about the impact of the Government’s policies on the disadvantaged. They have no monopoly of concern for the under-privileged and for the poor. As my collegue the honourable member for Lilley (Mr Kevin Cairns) says it is correct that they always attempt to convey this impression. What about the 250 000 unemployed that emerged from their administration? What about the suffering and difficulty caused by the most rapid inflation that the economy has suffered?
– They ought to be ashamed.
-Yes, they ought to be ashamed of themselves. The mechanism that honourable members opposite cannot or will not perceive is that they had the economy caught up in a rapid momentum of growth of government spending, financed by the rich harvest of personal and company taxation, which resulted to a considerable extent from the inflation it thus generated. The spending was financed not only by that but also by the ever growing Budget deficit with, left to itself, horrendous implications for creating a mountain of money and thereby further inflation. What the Opposition will not recognise is that this spending, far from having the old style pump priming effect on employment and activity, has a long term adverse effect on the non-government sector, on Australian business large and small, on Australian jobs.
I have stressed previously the magnitude of what was involved- that in 1972-73 the total of government spending was $ 10,000m and it had built up to that level gradually from Federation over a period of 72 years. Then in 3 years- to the current 1975-76 year- after that gradual buildup the level more than doubled and reached $22,000m. Even more graphically, in 1974-75 the level of spending increased by 46 per centand increase of nearly 50 per cent in one year on the level which, I repeat, had gradually been built up over 74 years since Federation.
– In one year?
– In one year there was nearly a 50 per cent increase. This momentum of rising spending, rising inflation and inflationary expectations and rising unemployment has to be curbed. Inevitably it creates an adverse impact on activity in the non-government sector. It affects the attitudes of consumers through the uncertainties generated by unemployment and inflation.
– Was it deliberate or through negligence?
-One has only to go back to the socialist ideology to which I have referred to appreciate its significance and its origins. Inflation induced rises in costs, plus efforts to limit price increases associated with excessive rises in costs, including the opening up of the floodgates to imports, undermined profitability. Honourable members opposite may not like profits but the fact is that today’s profits are tomorrow’s investments and the jobs of the day after that; meaningful, gainful employment for Australians, not the ad hockery of regional employment development schemes and other such projects.
Especially important in this process is the effect of inflation in creating fictitious profits and the taxation of such ‘profits’- a process which bleeds the business sector, as the Mathews Committee stressed. So in this way you shrink the incentive to invest and set us on the path to the British disease of a shrinking productive sector. It is this fundamental process, this momentum of spending finance financed by taxation with its long term adverse effect on the non-government sector, that we have to break. Let me however stress this and recognise an element of truth in the rantings of the honourable member for Adelaide. Under the previous Administration it was as though the economy was hooked on the drug of this ever-increasing process of spending with its adverse effect and, as with a drug, the withdrawal process is an extremely difficult and complex one. We know we will not win any short term bouquets in pursuing the process of bringing the economy back to heel.
– That is a brilliant analogy.
– I hope the analogy does assist in trying to get over to people the thrust of our strategy, and at the same time its complexity and its difficulties. The days of the free ride are over. There has to be more self-help, initiative and self-reliance. In child care, for instance, which is a subject of great concern to me, the Government will give reasonable assistance but there has to be initiative from people, from local bodies, and a rationalisation of facilities. Maybe the users will have to pay more, but it is part and parcel of the process of getting off this interaction.
– This drug.
– It is part of the process of getting off this drug, this momentum of government spending financed by the harvest of taxation and the deficit to boot, with its adverse long term effect on the non-government sector. Especially, I would stress, the Government is concerned in this difficult transition period about lessened expenditure which may impact directly on the private sector, and in general the pace of the process of restraining the growth of spending depends critically on the rate of pick-up in the private sector. The home building area is a case in point and the Government is carefully monitoring the situation, as witnessed by the States Grants (Housing Assistance) Bill which was brought in a little while ago by my colleague the Minister for Immigration and Ethnic Affairs (Mr MacKellar). In the context of the rate at which the private sector is brought back a critical element of the strategy is the 40 per cent investment allowance. The honourable member for Adelaide made disparaging remarks about this allowance.
– He does not understand it.
– As my colleague says, he would not understand it for one thing, but it is a key element in our strategy of encouraging a revival of business investment. As I have said previously, the process to which I have referred impacts critically there. That is at the centre of the malaise of the economy which developed under the previous Administration and it is of the utmost importance that our policy be directed there. I commend that allowance to businessmen outside. They should appreciate the importance of the advantage it confers.
There were many other aspects which the honourable member for Adelaide covered in the much longer time at his disposal, but let me conclude by stressing that in respect of the monetary package there is no credit squeeze. We have taken measures directed to eliminating an excess of money, not squeezing the money. We are bringing the money supply, as far as we can, to a reasonable level. We are trying to bring in control instead of having irresponsibility in the way it was just printed, as the honourable member for Wakefield will recall. It is not a credit squeeze but is a slowing down of the rate of the increase of the money supply to a reasonable level. In all these ways the policies of the Government form a complex designed to get inflation under control, to get Australia moving again and to restore full employment, meaningful and gainful employment, to all Australians.
Mr DEPUTY SPEAKER (Dr Jenkins)Order! The honourable member’s time has expired.
-May I begin where the honourable member for Berowra (Dr Edwards) finished. He said that certain restraint that was now thought to be necessary should not be described as a credit squeeze. In my day as Treasurer I had hurled at me the charge that something that was being done was a credit squeeze and I did endeavour to point out that credit squeeze is one of those witch words for which there is no very nice alternative. What does one say? Nobody thinks of attaching opprobrium to particular acts when money is easy to get but when, as a consequence of making it too easy to get, you decide to work the opposite way people use this nasty term ‘credit squeeze’ which I agree has high emotive overtones and possibly psychological effects. This is one of the difficulties, I suppose, of using too much economic jargon and of not perhaps getting down to what are some of the fundamental problems.
I would like to join issue with the Treasurer (Mr Lynch) in his assessment of the situation as this Government found it when it came to office. He said:
The results of this abandonment of all sense of budgetary responsibility led, in the ultimate, to a drying up of demand in the private sector and a quite devastating loss of confidence.
He then said:
Consumer spending fell away. Business investment slumped. Production fell. Job opportunities vanished and unemployment soared.
I suppose that is all summed up in the glib phrase that was used during the election campaign, that is, that the Australian economy was on its knees. I think the honourable member for Berowra used those fine words. To suggest the Australian economy was or is on its knees now is utter nonsense. The Australian economy is still one of the healthiest economies in the Western world and I would submit that nothing has been done yet by the Government now in office that in any way has changed the economic situation for the better.
The honourable member for Berowra referred to the investment allowance. There has been great praise of private enterprise in the abstract, but it has to have subsidies to keep it going. That is what the investment allowance is. It is time that these things were acknowledged. How else does one, in economic realism, describe the action of a person who buys a piece of plant for $10,000, who puts it in the books at $14,000, and straight away claims $4,000 as a tax deduction? Then he claims the normal depreciation on the $10,000, the true historical cost of the piece of plant. That is what the investment allowance is. It is a naked subsidy, yet apparently it is welcomed by the apostles of free enterprise who believe that government should not interfere. Apparently, assistance does not mean interference if the assistance is of that kind. I do not know whether the honourable member read in the Australian Financial Review this morning that two cement plants are likely to be constructed where only one is needed, because each is being lured by the investment allowance. Surely, this points to the need for some selectivity in the application of some of these concessions or benefits. Maybe the allowance should be given to only one out of the two but then there is the nasty decision as to which one of the two it is to be. We do not want to reach the situation again where there is over-capacity in some areas at the same time as there is under-capacity in others.
Among the usual bundle of papers that we receive every day- I think it was issued yesterdaywas the latest issue of the Round-up of Economic Statistics, a publication which I am responsible for initiating and which I am pleased to see has been taken up and is a monthly bulletin. This is number 38 so it has been going for quite a while. There is an addendum to this issue. Certain facts came in too late to be incorporated in the main text. They deal with the national accounts for the December quarter. I read from that addendum:
Preliminary national accounts statistics for the December quarter, which are subject to revision and should be interpreted with caution, suggest that total final demand for goods and services, seasonally adjusted at constant prices, fell by 1.3 per cent in the December quarter, following a fall of 0.7 per cent in the September quarter.
On a half-yearly basis it suggests that the half year to December showed a decline of 3.1 per cent at an annual rate. I am not arguing about the last 12 months. I think we have to go back to before 1970- the period when the present Government was previously in office- to find a real physical decline in total output. I think it is time we stopped this nonsense of suggesting that the economy is on its knees. Until the last six months- I suggest it will begin to climb upwards again- it was producing more goods and services than ever before which, after all, is what should happen.
– In real terms?
– In real terms.
– Are you serious?
– That is what should happen in an economy. The honourable gentleman should listen instead of exerting his complexes without really listening to the facts. At the end of June 1975 the gross national product corrected for price changes was higher than it had ever been before. That was during the period of the Labor Government- those terrible three years that are talked about. Unfortunately, the last twelve months has been the first year for a considerable time that total employment was less than in the year before but even that has begun to be reversed over the last several months.
The honourable member for Berowra talked about ideological problems. I say categorically that there will be no fundamental change in the Australian economy either in my lifetime or in his and he perhaps has a bit longer to go than I have. Essentially, it will still be a Western capitalist system and the greatest single economic problem that will confront it then as it does now is what share of the total product goes to wages. Wages are the biggest recipient of the gross national product. Wage earners are also the biggest single source of consumer spending. This, of course, is the great dilemma. The Government wants to cut costs but it also wants to increase consumption and as long as one of the principal costs is wages it will always face a difficult problem. The Treasurer at some stage in his remarks- he referred to what he thinks are excessive wage claims- said that during the period 1974-75 the share of wages, salaries and supplements of the gross domestic product rose from 61 per cent to 68 per cent. I suppose one could argue that 61 per cent was an unfair figure and perhaps 68 per cent was going too far the other way. But nobody can categorically assert what proportion of the GDP should go to wages. Eighty-five per cent of the working population are wage earners or income recipients. The squeeze on profits did more than just alter the relative shares of the national income. In 1974-75 company incomes, recorded in a conventional accounting manner, fell in absolute terms by 7 per cent while wages, salaries and supplements increased by 28 per cent. These trends forced businessmen to reassess the expected future profitability of their enterprises, the key ingredient in decisions to undertake investment projects.
The addendum to the document I have referred to which bears the date 12 March and which was issued yesterday says that the gross operating surplus of trading companies rose by 2.3 per cent in the quarter in current dollar terms- this is to the end of December 1975- and now stands at 11.9 per cent of gross domestic product at factor cost. Again, it is difficult to determine whether that is a fair or unfair figure but it is certainly a better figure than that at June 1 975. 1 suggest that this makes the analysis of the Treasurer rather silly. He based it on what was happening when company profits were falling as a share, whereas now they are increasing. Compared with a year earlier the gross operating surplus of companies showed a rise of 10.4 per cent. Whether that is a good figure or a bad figure it is certainly a better one than it was. The future attitude to wages- in the analysis that the Treasurer indulges in- contains some very serious implications if, as the honourable member for Berowra said, the real uplift in the economy must come from rising real consumer demand.
One of the things achieved by the Labor Government was to get some kind of compactsome people call it a contract; some sort of arrangement- the Government keeping the ring, between employers and employees as to how price increases should be met via the wage structure. This, after all, is what indexation was about. It was an attempt to take the inflation factor out of the wage process and to make wage increases dependent on work value, on productivity increases or something of the kind. That worked for some months, until the figure in the last quarter was 6.4 per cent. That seemed to horrify the Government. The unions had indicated that as long as the figure was less than one per cent they would not sue for the increase; it had to be more than one per cent in a quarter. When the figure gets to 6.4 per cent the Government is horrified as to the future.
– The majority of the population, too.
-I am not to sure that the majority of the population always understands these questions. There are times when the majority opinion is not right. A survey was undertaken recently of trade unionists in Great Britain. They were divided nearly half and half as to whether inflation or unemployment was the more serious matter with which the British Government had to grapple. The present Government seems to see inflation as the great danger, and I am trying to warn it that if it pursues the kind of policies which it is pursuing it will increase unemployment and probably will not do much to halt inflation. There is no easy answer to these sorts of questions. Least of all do I expect any constructive attitude to come from the people who are now the Government of this country, because I do not believe they understand the fundamentals of the matter.
Mr DEPUTY SPEAKER (Mr Jarman)Order! The honourable member’s time has expired.
– It gives me a great deal of pleasure to take part in this debate. I am surprised, I must admit, that it came on at all. My view was that the Opposition would not wish to enter into an economic debate in this Parliament. We heard from the honourable member for Adelaide (Mr Hurford) this afternoon. He is the Australian Labor Party’s fourth spokesman on economic matters in 4 years. The Labor Party has been through 3 Treasurers. Now, in Opposition, it has elected to put yet another man in the position of economic spokesman.
– There could be a change next week.
-The feeling is that next week the Opposition’s present economic spokesman could find his position usurped by a former Treasurer who has deigned to come back to the front bench, at the behest of his Party colleagues.
– That is not likely.
-I support the honourable member for Hindmarsh. It should not be likely, because the problems that Australia is facing today are as much the result of the policies of the honourable member for Oxley (Mr Hayden) as of those of the honourable member for Melbourne Ports (Mr Crean) and those of the man who was in the middle of the two of them, the honourable member for Lalor (Dr J. F. Cairns). I hope that the honourable member for Adelaide will produce on behalf of his Party a more coherent policy which can be considered seriously by the Australian electorate.
The record of the previous Government was disastrous. It was not disastrous in any minor way. It affected every sector and every home in Australia. It was felt by the manufacturing sector. Its policies affected the minerals sector, the rural sector and even the consumers. The previous Government proposed policies and altered policies during the period of its administration in such a way that there was no certainty in economic policy at any stage. There was uncertainty. There were no guidelines as to economic policy. In fact, there was no policy at all. It was changed ad hoc, at whim and with the changes in personnel in the Treasury portfolio. I instance only a few examples of the ad hockery and mismanagement of the former Government. We could look, firstly, at the wages policy and the use of the public sector and government employees as a pacesetter, not only in terms of wages but also in terms of superannuation. I instance also the tariff changes, the revaluations of the Australian dollar, the alterations in sales taxes, the alterations in the level of company taxation, the introduction of the payment of tax by companies quarterly, the rising costs caused by inflation and the squeeze on profits, which was mentioned by the honourable member for Melbourne Ports. I point out to him that profits’ share of the gross domestic product in 1971-72 was 15.4 per cent. In 1972-73 it was 15.9 per cent. In 1973-74, with the Labor Party’s policies beginning to work, it fell to 14.8 per cent. It still was not disastrous. In 1974-75 it fell to 1 1.8 per cent. It went to a low of 10.6 per cent. The honourable member says that it has risen by 10 per cent; it is 1 1 .9 per cent. So it is. It ought to be, historically, about 15 per cent or 16 per cent.
If there is to be any incentive to the great producing sectors of our economy, if there is to be any incentive for people to provide the jobs, there must be a reasonable degree of return on investment To members of the Opposition I say that that means profit. They do not understand that. All they are interested in doing is feathering the nests of their unionists and improving the conditions of their workers. They do not understand that by doing exactly that they are reducing the opportunities for employment. There is no alternative, because the cake is only so big. If they want to cut a greater slice of that cake and give it to one sector, they do so at the peril of the other sector, because of the partnership arrangement.
– You are a real rabble rouser.
– I appreciate the compliment from an eminent rabble rouser of long experience. I cannot put too strongly the point that there must be an understanding between both sectors- those who employ and those who work- because each is offering something and each expects a return. The worker expects a fair return for his labour. I believe that he should get it. I do not believe that his return should be exorbitant; nor do I believe that the profit of the employer should be exorbitant. The Opposition, when in government, did not understand that and was set upon redressing what it saw as the imbalance as a result of 20 years of LiberalCountry Party suppression of the workers. It was just not on. Free enterprise balances. When governments interfere with free enterprise there is a price to pay. This Government’s philosophy is about withdrawing and getting the dirty fingers of government out of the lives of people and out of the management of the economy, in terms of the private sector and its relationships with the other sectors. I believe that in doing that, with the minimum intervention by the Government, we will get the best response and we will get the greatest benefit to the economy. The greatest benefit to the economy means that everybody gets a greater share.
The previous Government laid great emphasis on the world situation and the effects that was having on Australia. It has been demonstrated, I believe, beyond doubt that certainly an inordinately high proportion of the situation that existed in Australia was brought about by that Government. Our responsibility now is to redress the imbalance of the last 3 years and to see that our economy is put back on its feet. This Government does not believe that its prime concern is to redistribute the wealth of Australia. The prime concern of this Government is to see that the wealth of Australia is increased. The Labor Party in government could not see beyond the redistribution of the country’s wealth and it lost track of the creation of wealth. In fact, despite the arguments put forward by the respected honourable member for Melbourne Ports, who was a former and the first Treasurer of the Labor Administration, gross domestic product in the last financial year was down in real terms, and the figures show that it was down. There is no argument about it. That Government ought to have been concerned not with handouts, not with that redistribution, but with the creation of a stronger economy.
– What about the GDP at factor cost?
– We are talking about the GDP at real cost. Of course, if we have got 20 per cent inflation all the figures are going to be distorted. In his statement the Treasurer (Mr Lynch) pointed out that over a generation $100-1 think these are the figures, but in any case it was a very interesting calculation- will become worth a cent if on an annual basis the inflation rate continues at 14 per cent. That is the sort of thing which people on the honourable member’s side of the Parliament are prepared to accept; we do not. We want to do something about the situation. The first thing that has to be done if we are to do something about it is to accept restraint. We have got to have a situation in which the Government is prepared to look at its own expenditure. The first thing that this Government did when it came into office was just that. The Bland Committee is looking into this matter. Honourable members opposite will not like its report, and we will not like it very much either, but it has to be accepted by this Government, because if it is not accepted we will never be able to curtail the involvement of government in the community.
– If you were able to stop interjections you would be doing pretty well.
– You had a fair go this morning, Mr Cameron; you had an excellent go.
Mr DEPUTY SPEAKER (Mr Jarman)Order! I suggest that the honourable member address the Chair.
-The Government of the day has to create an environment in which everybody can participate- in which workers can work, in which producers can produce and in which growth can take place. That is what our philosophy is. We do not want to create a system of dependence of individuals in greater and greater numbers on the Government, firstly for work and, secondly, for handouts. We are not interested in that. We take the view that a certain sector of the community has to be protected and that another sector of the community has to be restrained. However, one fact that has to be accepted is that by and large, and as far as possible, the individual has to accept the responsibility for himself, and the Government has to accept the responsibility for as few people as possible. The Government of the day has to recognise- I think this is the crux of the federalism policy which we will be introducing- that there are States and that those States have got massive responsibilities in the areas of health, education, Aborigines and a whole range of things, and that those States’ governments are charged with the responsibility of looking after those areas. The
Federal Government should not have to dabble too much in those sectors of the administration of the nation. The Federal Government’s responsibility, in my view, is to co-ordinate, to see that there are not great disparities between different States. I think that is something which ought to be accepted and understood.
If we can accept that, we can disband 85 per cent of our Department of Education; we cannot have a significant Department of Tourism; we can break down Federal responsibility in the administration of Aboriginal affairs; and we can reduce Federal responsibility in so many other areas, because there is no requirement for duplication of administration. If honourable members opposite want to argue that the Government in Canberra is the one that does all these things, then they have got to wipe out the States. If that is the argument they want to put up, then they should put it up. But we cannot have a system in which everybody is climbing over everybody else, in which everybody is competing with everybody else, and in which everybody is spending unnecessary fortunes in administration costs because of duplication in those administration costs. This Government, I hope and believe, will take giant strides in the removal of duplication, in cutting down the unnecessarily large size of the Federal Public Service and the enormous costs related to it.
I believe that there has to be a very close look- the Government has already expressed that this is its view- at the priorities and the programs of the previous Government. Although, in individual and in isolated terms, people are prepared to accept that the National Employment and Training scheme is good, that the Regional Employment Development scheme may have had some benefits, that the Australian Assistance Plan and the Australian Improvement Program may have had some intrinsic value in view of the economy of the time and the difficulties that are faced by the economy of the time, these things may have to be deferred. They may, indeed, have to be eliminated.
I believe there has to be a very close and detailed look- I know that the Government intends to undertake that detailed look- at so many of the expensive programs which, although they may be worth while in themselves, cannot be justified in the present economic climate. I think the important aspect of the Government policy, as was pointed out so ably by the honourable member for Berowra (Dr Edwards) is that we have a philosophy. We are prepared to lay down the guidelines. We are prepared to have them debated, which is something the Opposition, when in government, never would do. We are prepared to have them discussed but, above all, we are desirous of saying to the business community, to the private sector, to the wage earners and to everybody who is involved in our economy: ‘We are trying to set you guidelines which will continue and which will be consistent for a period of time in which you can make your economic decisions in the knowledge that those economic decisions will not be changed next week, next month or some other time.’ We, at least, will offer the most important thing that the business community and the economy could ask for- that is, consistency of policy. If we can achieve that, we will have done a great deal for the Australian economy.
Mr DEPUTY SPEAKER (Mr Jarman)Order! The honourable member’s time has expired.
– I was rather amazed to hear the honourable member for Hume (Mr Lusher) say that government intervention was a bad thing. Coming from someone in the National Country Party, I can only regard that as a breathtaking remark since, surely, the Country Party must be the past masters in this Parliament at organising government intervention to support their own interests. I think it is a matter not so much of opposing government intervention but of opposing government intervention of a particular kind. I wish to deal with a number of fundamental misconceptions which seem to me to beset the statement of the Treasurer (Mr Lynch).
The first point I wish to raise is not one on which I wish to spend a great deal of time. It is a fundamentally important point. It is the continued reiteration which we saw for 3 years- and which is still continuing, understandably I supposeof the tired assertions that the state of the economy is due to Labor’s mismanagement. I do not intend to say that the Labor Government had nothing to do with the state of the economy. Obviously, we made some mistakes and we must take some of the blame. But it must surely be acknowledged that all around the world there were enormous difficulties in managing the economy in that period. Every country which was organised in a way similar to ours- that is the Western capitalist countries- had enormous problems. Indeed, the statement by the Treasurer that it was only when Labor came into office that Australia’s performance deteriorated compared to the rest of the world, is simply untrue. He specifically mentioned inflation. The fact is that in 1972 the inflation rate of 5.8 per cent in Australia was higher than it was for the average of the Organisation for Economic Cooperation and Development countries. The OECD rate was 4.7 per cent. We were significantly above the rate for comparable countries under the previous Liberal Government, in the period just before Labor came into office.
I think it is important to reiterate the problems with which Labor had to contend once it obtained office. I mention 3 items which were of significance. Firstly, there was an enormous rate of increase in the money supply in the half year before we became the government. Yesterday, during question time, the Treasurer referred to the monetary time bomb which the Labor Government had left him. If he regards the rate of increase in the money supply of 20 per cent last year- which in the last half of last year was only 15 per cent- as a monetary time bomb, what would his description be of the rate of increase in the money supply in the last half of 1972 at an annual rate of 34 per cent which is more than double the rate which applied in the last half year under the Labor Government? If one was a monetary time bomb the other must have been a monetary nuclear time bomb at least. Clearly this was an enormous problem for the Labor Government to handle. We had a very severe rate of increase in the money supply. It was something which we immediately took action to chop off by means of the revaluation after we became the Government but it nevertheless posed some sort of a problem and I acknowledge that point.
There was an enormous increase in export prices in 1973 and that increased the domestic price of exportable goods. The obvious example is beef prices, meat in general but beef in particular. They accounted for one-third of the inflation in this country in 1973. Of the 9 per cent inflation 3 per cent of it came from increased meat prices and this had nothing to do with the activities of the Government. This, of course, was part of the developing world inflation which reflected itself subsequently in an enormous increase in import prices. In 1974 the rate of increase in import prices in this country was absolutely staggering and I have never heard anyone in the Liberal Party or the National Country Party acknowledge that fact.
I will illustrate just how staggering import prices were, and imports represent something in the order of 20 per cent of the total gross national expenditure in this country. If we look at the import price index published by the Reserve Bank we will see that there was a fantastic increase in import prices for all kinds of items, not just petroleum, in 1974. 1 will give examples. The index is published and based on 1966-1967- that year equals 100- and is broken up into various items which I will mention. For food, beverages and tobacco in the calendar year from December 1973 to December 1974 the increase in the import prices was 27.8 per cent. For inedible crude materials it was 51.8 per cent. For minerals, fuels and lubricants it was 302.9 per cent. For chemicals it was 64.8 per cent; for manufactured goods, classified chiefly by material, it was 45.8 per cent. For textiles it was 21.2 per cent. For machinery except electric machinery it was 35.2 per cent. For electric machinery, apparatus and appliances it was 36.7 per cent; for transport equipment it was 33.8 per cent and for miscellaneous manufactured articles it was 31.1 per cent. Those percentages represent the increase in import prices during the calendar year 1974. Is it any wonder that there was a substantial rate of inflation in Australia in that year? No government could possibly have maintained anything like a normal rate of inflation faced with that fantastic influx of inflationary goods on to the markets through imports.
Taking the index as a whole, the all items index which includes petroleum went up by 63.7 per cent in that period. For technical reasons that is an inflated factor because since the base year our imports of petroleum have dropped back and therefore the weighting of the index is slightly inappropriate. But if we take all items excluding mineral fuels it was 38.9 per cent. If one took a figure somewhere in between those two he would get the likely figure for the increase in import prices in Australia of about 50 per cent in 1974. That is something which I have never heard acknowleged by anyone on the government side but clearly it was a matter of enormous importance in understanding why we had such inflation in 1 974 and subsequently. As a big trading nation we were terribly badly hit by the movement in world inflation.
Having dealt with a few items to explain that the state of the economy was by no means entirely due to Labor’s mismanagement I would like to refer to the supposition of the Treasurer that the principal economic variable to control at present is the money supply, or the rate of growth of the money supply. This attitude accounts for the Government’s total preoccupation with the level of the deficit and the means of financing it. How the deficit grew has been explained by me previously, and by the honourable member for Adelaide (Mr Hurford) today. Very briefly, it was due not to extravagant government expenditure but to measures taken to offset levels of unemployment in 1974 and to the fact of the recession itself, meaning reduced revenues, and also to the much lower rate of wage increases in this financial year. This has resulted in Australia having a much higher level of deficit than we are used to. That is not something which is utterly unusual in other countries, either. All countries are experiencing much higher levels of deficit than they are used to.
I refer to the Australian Economic Review for the third quarter of 1975. It contains an article entitled: The Budget Deficit, Money Stock and Indexed Bonds. Under the heading Growing Budget Deficits- An International Problem- it says:
It is not often realised that a swollen Budget deficit is a phenomenon which Australia shares with most of the major industrial countries. Some of them are experiencing a more severe change from past levels than in this country . . .
Later, it says:
Thus in each of them, deficits of the broad magnitude currently envisaged for Australia are proving compatible with a reduction in the rate of inflation.
Although the details differ from country to country, 3 basic cyclical factors have been the main reasons in each of these countries for the emergence of such massive deficits. These factors are a slackening in revenue because of the slump in activities, tax cuts or increases in government expenditure designed to stimulate economic expansion and higher supportive expenditures either in the form of unemployment benefits or of measures to support ailing business enterprises.
This report quotes the German Bundesbank in this respect: … the Bundesbank defends the current very high deficits as being ‘in any case necessary at the moment for reasons of anticyclical policy ‘.
It flows from that that much higher Budget deficits than we are used to are something which again are not solely restricted to this country. They are happening in similar countries. But they are nevertheless able to bring about a reduction in the rate of inflation. Indeed, that is what was happening in this country. Whilst the Budget deficit was growing rapidly, we were in fact bringing about a reduction in the rate of inflation, largely due to the success of the indexation policy which has now been jeopardised by the actions of this Government.
We do agree however that financing a deficit by tapping household savings is a reasonably sound policy. That is what the Government is doing with its Australian Savings Bonds. We think this scheme has some sense because Australian deficits have been financed by a relatively low proportion of loan money in the past and because household savings have grown enormously. In fact, this same article in the Australian Economic Review to which I referred previously contains a table which shows that household saving grew from 37.4 per cent of total savings in 1973-74 to 50.2 per cent of total savings in 1974-75. This is a very substantial increase, far above what we have been used to. This growth in the level of household saving as a proportion of total savings is something which again, is happening in most other countries.
Having said that, I believe that it must be agreed surely that the Australian Savings Bonds series 1 was a mistake. The interest rate was certainly too high. The series lasted for 2lA weeks only. It raised $565m in that time, plus some amount in the pipeline, we were told, at the time when it was cancelled. That ‘some amount’ was in fact $ 195m. This figure shows how the money was pouring in. What would have happened if that issue had gone beyond a month? There would have been a much greater flood of money, especially from those who have money on fixed deposits and who had to give a month’s notice that they wanted to withdraw those funds before they could have access to them, to invest them in the Australian Savings Bonds. There would have been a tremendous outflow of funds from various institutions, and we would have had a real liquidity crisis on our hands.
However, the fact that the Series 2 Bonds, at a lower rate of interest, are attracting funds steadily again shows that the rate of interest on the Series 1 issue was much higher than was necessary. Let me raise one query in this respect. I wonder whether we can really regard the money invested in Australian Savings Bonds as having been taken out of the money supply. If inflation continues to rise in a few months time, as is at least possible, that money could quickly be reclaimed. By the end of this year, that money will be reclaimable on one month’s notice.
If it is reclaimable on one month ‘s notice it can very quickly be used for expenditure in the same way as money taken out of a bank. So it seems to me that although for the time being that money is more or less locked in, by the end of this year those funds will be no more locked in than money in, say, fixed deposit in a bank for which one month’s notice must be given for withdrawal. So I think it is at least doubtful whether this is a long term financing of the deficit in a way which will reduce the rate of increase in the money supply. Perhaps indexed bonds would be better in this case, because if the rate of inflation were to rise then people would not want to transfer their money from those bonds as they would be protected by the indexation factor.
If a policy to reduce the rate of increase of the money supply is continued there must be an increase in interest rates. Every economics student in Australia knows that you cannot control both the money supply and the rate of interest; it is either one or the other. Either you have a tight control of the money supply- in this situation that would probably mean higher interest rates- or you control interest rates and let the money supply go. You cannot do both. What is happening here is that through the efforts of the Government to control the money supply already building society interest rates have gone up- not just in New South Wales as is being claimed but also some in Canberra and some in Victoria.
Concentration on reducing the rate of increase of the money supply also dictates the need for expenditure cuts. Already we have had $360m worth which have meant the breaching of Budget promises to people such as Aborigines. If we are to have much greater expenditure cuts, as seems almost certain to happen under the present policy, there will be much more in the way of breaching of election promises to various groups in this community. The Mathews Committee report, if implemented, would cost $2,500m. A substantial move in that direction, say one-third, would cost $800m this year. If the Government is going to reduce the deficit as well, it would have to cut expenditure by $800m plus the amount by which it is going to reduce the deficit.
Mr DEPUTY SPEAKER (Mr Jarman)Order! The honourable member’s time has expired.
Question resolved in the affirmative.
Debate resumed from 4 March on motion by Mr Sinclair:
That the Bill be now read a second time.
-The States Grants (Fruit Canneries) Bill 1976 provides for financial assistance to fruit canners in Victoria, New South Wales and South Australia. Assistance will be provided by way of loan moneys to the States for an amount equal to half of the payments by each State in respect of advances to cooperative canneries to permit canneries to pay growers an additional payment for the 1975 season deliveries of apricots, peaches and pears. The Australian Government’s commitment will be limited to $2,456,567.
The Opposition does not oppose this legislation but seeks to amend it by requiring the Government to consider the Australian Industry Development Corporation report for the rationalisation of the industry and to act upon it. As an amendment to the motion that the Bill be read a second time, I move:
That all words after ‘That’ be omitted with a view to substituting the following words: ‘while not declining to give the Bill a second reading, the House is of the opinion that (a) the problems of the canned fruit industry are a legacy of the reckless overexpansion of the production base fostered by successive Liberal and Country Party Governments throughout the 1960s, and (b) the Government should consider immediately the AIDC report handed down in September 197S, with a view towards significant rationalisation of this industry to prevent further hardship to growers and their families’.
For the fourth time since 1970 this Parliament has had to legislate for assistance by way of loans to the fruit canning industry. In 1970 a loan of $4.2m was provided through the Victorian Government for the Shepparton Preserving Company Ltd. In 1971 there were payments through the New South Wales Government to the Letona Co-operative and through the South Australian Government for the Jam Preserving Co-operative and the Riverland Co-operative. On both occasions these grants were matched by State assistance. A total of $2.2m was provided from Canberra.
In 1972 there were loans for the Letona Cooperative through the New South Wales Government and in South Australia there were again loans for the Jam Preserving Co-operative and the Riverland Co-operative, and through Victoria yet another loan for the Shepparton Preserving Co. Ltd- altogether, a total of $ 1.9m as a Commonwealth contribution. In November 1973 there was currency re-alignment assistance of $ 1.5m provided by way of grants to canneries exporting canned deciduous fruit. That $1.5m grant ameliorated the previous loans which had been lent to these growers in earlier times by about $800,000. Now in 1976, we find that canneries again are unable to meet their commitments and that these major co-operative canneries have been able to pay growers only 40 per cent to 60 per cent of the price declared in 1975 by the Fruit Industry Sugar Concession Committee for fruits delivered for this season. Naturally, no institutional lenders will come to the aid of these canneries because of the intrinsic nature of the problems afflicting this industry.
The payments of loans to the canneries concerned are as follows: In New South Wales the Letona Co-operative Ltd will receive $338,222.
In Victoria the Shepparton Preserving Co. Ltd will receive $306,375, Ardmona Fruit Products Co-operative Co. Ltd $628,451 and Kyabram Preserving Co. Ltd $771,018. In South Australia the Riverland Fruit Products Co-operative Ltd will receive $412,500. The loans will be repayable within 2Vi years, including interest at 10 per cent per annum. With a limited domestic market with potential only for moderate growth and with severe export competition from South Africa, the United States and Greece, the industry faces a classic problem of over supply. Australian canned fruit has suffered price reductions in the United Kingdom market and freight and market costs will diminish returns this year. Also upward movements in labour and material costs are having a deleterious effect on the viability of the industry.
The shrinking exports of Australian canned fruit would seem to indicate a continuing trend with a 25 per cent tariff against Australian canned fruit in the European Economic Community, the extra competitive position of South African exports following the devaluation of the rand and the penetration of Greek canned fruit exports into the EEC by way of preference to Greece as an associate member of the EEC. Canada is also slowing imports of Australian canned fruit by requiring Australian canners to increase prices to avoid anti-dumping duties. Another mitigating factor against Australian exports is the large crops of the last few years in the United States of America and South Africa. There seems to have been a flight from reality by this industry in not recognising the signs in the market place. Apart from measures like eliminating price competition by Australian canneries in the export markets and selling under one label, there has been no attempt to significantly restructure the industry.
It is because the livelihood of our 2000 growers and their families is affected by this crisis, along with the workers in canneries, that the Opposition will support this legislation. However, we believe that the AIDC report commissioned by the Labor Government should be considered immediately and not put off on the basis of securing an up to date report as the Minister indicates in his second reading speech. Obviously, the factors affecting this industry have not changed since the report was completed a short time ago. There may have been some minute changes but surely the general trend would have been sustained. I believe it is a ruse to give the Country Party a way out, in the immediate term, of coming to grips with the problems that beset this industry, most of which is within electorates held by the Country Party. All the canneries affected are situated, as are the growers, in areas represented by the coalition Parties in this House and therefore the Government is afraid to take a decision. The Leeton Cannery is in the electorate of the honourable member for Riverina (Mr Sullivan) of the Country Party. The SPC and Kyabram canneries are both in the electorate of the honourable member for Murray (Mr Lloyd) and the Riverland and Berri Fruit Juices Co-operative Ltd canneries are situated in the electorate of the honourable member for Angas (Mr Giles.) I hope that these men, will in the interest of these people they represent, vote for the amendment I have proposed to the Bill, or explain themselves to this industry and those who live from it. People in this industry should insist that the Government come to terms with the problem of the industry and implement a plan for its solution.
However, the industry must also assist itself and such activities as a stupid price cutting war is perhaps the most short-lived and primitive form of market penetration there is. This little skirmish cost the industry somewhere between $4.5m and $6m this year- money it could ill afford to lose, particularly when it is now forced to come cap in hand to the Australian Government for $2.4m and the same from the States. Perhaps a better solution for expanding the domestic market for canned fruit would be to put export quality produce on the local market instead of the poorer quality fruit that is now available to Australian consumers. Surely there is no valid argument for denying Australian consumers first quality produce.
Whichever way one looks at this industry, a stable and larger domestic market would be the best base upon which to restructure it. At present, the domestic market accounts for only one-third of production. Even from the short cut price campaign that was implemented by these canneries, the domestic market penetration rose considerably. It will probably drop off as the price stablilises But I believe that the point is that if we could get round to the situation where there is a higher content in terms of the domestic market, the industry would at least have a firmer base. Surely this would be helped by the presentation of first quality produce on the Australian market.
The Opposition supports the legislation. It is at least humanitarian to guarantee that these growers and their families receive money which should be available to them from these canneries. It is a pity that now they are only going to get about 70 per cent of the FISCC price in this
Bill, not 85 per cent, although the 15 per cent is to be made up by the canneries. But at least that is better than 40 per cent- 60 per cent. So we support the legislation. But there is no valid argument for putting off any longer some decision to restructure the industry. In the 1974 season there was some respite from the problems in the industry. Perhaps it did lull the then Minister for Agriculture and the Parliament into a situation where they believed that this industry was going to pick up. But that is not now the case. It seems that there is an overwhelming case for doing something in very serious terms about the plight of the industry. I might just deal again with the second part of the amendment which states:
By the way I have not seen this report; I do not think that anyone has- with a view towards significant rationalisation of this industry to prevent further hardship to growers and their families.
I commend the amendment to the House.
-Is the amendment seconded?
– I second the amendment.
– I suppose that I cannot be surprised the the spokesman for the Labor Party has not seen the Australian Industry Development Corporation report of September last year, because frankly I have not seen it either. But if the honourable member for Blaxland (Mr Keating) thinks that the industry will want the Government to accept the second part of his amendment, I think he is sadly misculng. As a result of the introduction of the States Grants (Fruit Canneries) Bill 1976, it became apparent- I hope that the Minister for Primary Industry (Mr Sinclair) will agree with what I am about to say- that the findings of the September 1975 AIDC report had become hopelessly out of date. A whole series of new statistics and new facts have had to be referred back by the Minister for Primary Industry to the AIDC for further report. I think that the industry would not be pleased to see that the Opposition spokesman, in part (b) of his amendment, says: the Government should consider immediately the AIDC report handed down in September 1975, . . .
That is patently out of date and is patently absurd. I think it would not be the sort of course that would recommend itself either to me or to the industry as such. Maybe he would have a better chance of getting his own amendment through in this chamber if he updated it. In the current situation it is meaningless to the industry. I am sorry for the honourable member for
Blaxland (Mr Keating) who has taken on this shadow portfolio at such short notice. Obviously he has not had a chance to take in all the intricacies involved in the legion of problems facing the non-urban and country areas of Australia today. I thought he harped a bit too much on previous funding. He mentioned some of the reasons for that funding in his speech by pointing out that the European Economic Community countries which were big export markets in the past had now, by virtue of their own political action, their own protective measures, thrown the industry in this country into difficult circumstances. At that stage the Government was quite right in making compensatory payments for something which was not the fault of the Government on the one hand or of the growers on the other hand. An adjustment payment which was needed was made at that time. I do not think this really has much to do with the facts which are before the House at this time.
This is an on-lending Bill to make payments indirectly to the co-operative canneries. When the Bill is passed it will enable the canneries to raise cash payments on the 1974-75 fruit. It will not involve this year’s fruit, the harvest for which is almost completed. I shall deal with the matter of this year’s payment later on when the Australian Industry Development Commission comes down with the additional information which was sought from it by the Minister. The industry is suffering grave economic difficulties at present, because the traditional banking institutions are unable, because of marketing difficulties, to find further finance. One ponders whether the industry or governments of the past have not been at fault in not recommending some form of interim payment which is equivalent to the interim payment to the dairy industry. This payment is struck at a conservative level. It gives a form of monthly payment to dairy farmers. This has never been the case in the canned fruit industry or, I think, in other fruit industries.
The problem facing growers at this stage is such that once the reconstruction and rationalisation of the Industries Assistance Commission comes in we probably then ought to look at some method of forward payment to the growers. As I will explain later in my speech, the position is becoming patently absurd as far as the growers are concerned. I note that the previous speaker accused a previous Government of encouraging over-production. There was no real overproduction. Some time ago exports flowed freely to Great Britain, West Germany and, to a lesser extent, to other EEC countries, the cost of production was competitive. Today the problems of the industry are largely but not entirely induced by the cost of production of the product. In this situation the foremost thing one thinks of is that the canners are not efficient. I think there is room for added efficiency and for rationalisation so that a bigger throughput can occur. This will be argued very heavily in some areas but I believe there is some room for it.
Recently I travelled through America. For the first time we now have to consider the fact that America’s method of regulating and governing its economy is much more successful than ours. The cost of production of canned fruit today is round about 30 per cent lower in America than in Australia. I hope to be kind in my remarks but, quite frankly, the mismanagement of the economy over the last 3 years of government has so increased the cost of production that our exports are now not competitive on any market in the world. The poor grower receives his payment only after all the extra charges that are levied on the industry have been met.
Let us look at one or two figures, because they might be of interest to growers if governments were to change in New South Wales, Victoria, Queensland or Western Australia. In my electorate the Riverland Fruit Products Co-operative Ltd, which is one of the beneficiaries- if that is the right word- of this legislation, now has to pay under the State Labor Government nearly double the workmen’s compensation that it paid the previous year. In fact, on a work force of 100 or 120, building up to 750 during the canning season, it is now paying $235,000 in workmen’s compensation. The Federal Government takes no company tax from it because it is a cooperative. The State Government levies $2 10,000 in payroll tax.
Attached to this pyramid like a couple of big ears, one on each side, are 2 ancillary industries. One makes cans; the other makes cartons. The cans are ordered and paid for. The work force making them is paid at a very greatly increased level. The cartons are ordered and paid for. The work force making them is paid at a very greatly increased level. The 1 10 to 120 members of the permanent work force who form the main pyramid are paid at increased rates. In fact, I believe that one overtime shift on a Sunday recently cost Riverland in the region of $11,000. For the return gained it is patently absurd to continue running that extra shift.
The charges for workmen’s compensation and payroll tax in South Australia make it the highest cost State in Australia, whereas not many years ago it was the lowest. There is literally nothing left for the reason for this pyramid structure- the growers. If the Government of South Australia has, as it is reputed to have, a $40m surplus in its budgetary accounts, I think we should look again at the Bill. There are several points that are of absorbing interest to me. Clause 4 (Conditions) provides for payments by the Commonwealth to the States as set out in the Schedule, which honourable members will have seen already. The States will match these payments. In due course, when the funds flow through to the canneries, they will be able to make payments of greater than, say, 50 per cent of the Fruit Industry Sugar Concession Committee’s 1974 prices. It is then a matter of the canneries making repayments to the States. If I were in charge of a cannery and my growers were getting very little, I would be working very hard on the State government concerned for some relaxation of the repayments. The States themselves deal directly with the Commonwealth. In this respect I note that clause 4(3) states:
The conditions referred to in sub-section (2) shall provide for completion of the repayment by 30 June 1978, but may provide for extension of the time for completion of repayment in special circumstances.
I can think of one or two instances which, if I were in charge of a co-operative, would amount to special circumstances. This gets back to one of the problems of this legislation and, if the Minister will forgive my saying so, of the Minister’s second reading speech. It is not made plain to the growers in his speech or in the legislation that they will be able to expect, in due course, 85 per cent of the FISCC 1974-75 prices.
Let us get back to what happened. Industry representatives came to the Minister very properly and very promptly after the change of government. Frankly, one of the problems we now face is that the previous Government was quite negligent in dealing with this situation. It had floated- I believe that no work had been done in the Department- a scheme very similar to the one we are now debating but based on a 70 per cent payment. Naturally, when the government changed, representatives of the industry approached the new Minister. I presume they said: ‘Look here, Mr Minister; this is what the previous Government was going to do. We do not think it is enough, but will you please trot this small exercise up to Cabinet and see what it thinks of it’. The 70 per cent repayment was then agreed to by Cabinet and that proposition was put to the growers. The growers and other sections of the industry turned it down for reasons that are a little complex and which I will not elaborate. Then there was a second time around negotiation in which the State Government of Victoria in particular produced a very good and weighty argument to show that the higher payment was needed if country towns in that State were to exist. My own Government -
– That is after the Federal member for the area pointed it out to them.
– I see. I do not know the innermost thoughts or actions of the honourable member. I will continue with my remarks. During the second time around negotiations, force, by way of proper deliberate argument, showed that the first time round negotiation 70 per cent repayment would not meet the circumstances. So the second time around negotiations proceeded. The conditions which emanated from those negotiations are governed, I believe, by what is stated in clause 4.( 1 ) which states:
Payment of an amount to a State under this Act is subject to such conditions as the Minister, by instrument in writing, determines.
I would like the Minister at the end of the debate to tell me about this because I am not convinced from what I have heard that there is such instrument in writing yet. But when the instrument in writing does appear and the epistle goes forth from the Department of Primary Industry or its Minister to the canneries, I expect and hope that one of the things that it will say is that although there was no change in the Federal donation and the State donation between the first time round and the second- the payment remains at 70 per cent and this I imagine is where the honourable member is at some slight disadvantagethe extra 15 per cent necessary to affect the 85 per cent return to the growers will be found by the canneries, largely due to the tax holiday, if I may roughly term it that way under which the first repayment time is increased from 6 months to 12 months. It was from that revolving fund, for want of a better phrase, within the canneries themselves that the 15 per cent additional to the original 70 per cent repayment is to be found.
I will be very interested to hear the Minister’s reply on this matter in due course because it is a clear understanding of growers that this second time around negotiation allowed for an 85 per cent payment on fruit in January 1975- a long time ago now- to be available to them. Let me return to the point I was making a few minutes ago. There is a certain amount of confusion about the matter. This condition is not set out in the Bill or in the Minister’s second reading speech. I presume that the sub-clause which I read from the Bill will cover that situation.
There is another reason why the industry has been in quite a deal of strife. It is not only the result of bad management by governments or huge increases in costs which have put the industry in an uncompetitive position. There is also the problem of exchange rates. I have not had a chance to show the Opposition spokesman on primary industry matters a table which I wish to incorporate in Hansard. He was speaking in the debate before me. The table is purely a comparison, month by month, of the exchange rates for the South African rand and the Israeli pound in relation to the Australian dollar. I seek leave to have the table incorporated in Hansard.
-Is leave granted?
-There being no objection, leave is granted. ( The document read as follows)-
Compiled at request by the Statistics Group of the Legislative Research Service from information supplied by the Department of Business and Consumer Affairs.
-Thank you. I have had this table prepared to show that since September 1974 at any rate the exchange rate between South Africa and Australia has differed very little, whereas, of course, the Israeli pound has all but doubled its competitive position against the Australian dollar. It may well be that prior to September 1974 there were big movements in the South African rand. But we must acknowledge that there are elements in this matter that are not all the fault of the previous Administration. Some of the fault lies in the devaluation processes of two of the main competitors of the Australian canned fruit industry, namely Israel and South Africa.
I do not believe that we have to worry about the exchange rates of the United States of America as the formula on which we base our minor float is based pretty strictly on the American dollar. So we equate with America and we do not have to worry about that country in those terms. As I said a little while ago we do have to worry about that country’s cost of production which is becoming cheaper than it is in this country for the first time in my memory. Anybody who has been to America lately will realise the enormous change in the cost of staying in that country compared with other countries. Of course that competitive advantage is a pretty meaningful one especially as the equivalent of the Kennedy Round negotiations are about to take place again, one would anticipate, under a future Ford administration There will be problems for this nation when the United States negotiates on the lowering of protection rates and encouragement of trade. Many of the problemsand I say this at the risk of repeating myselfstem back entirely to the huge increase in the cost of production in the last 3 years of which honourable members are very much aware.
I have mentioned that the grower responsible for these pyramids of investment, of huge processing plants and ancillary industries, still gets only what is left over. I cannot emphasise that strongly enough. Everybody else in this nation today seems to be able to pass on in some way or other to the consumer the increased cost of production. There is one isolated area that cannot do so. Apart from the grain growing sections of rural industry for the time being, which, thanks to export demand, are in a pretty healthy position- I will probably get into trouble for saying that but I believe it is true- every other section of primary industry is rapidly reaching the poverty level. We heard in this House the other day of a good dairying area of Australia in which the producer is averaging $30 a week. This is his return on a 90 cow basis. When I first went into dairying 20 years ago that would have been almost the biggest herd in Australia. So no one would say that the problems in this industry have arisen because of uneconomic herd sizes. This is the picture that is emerging. The people of Renmark, Loxton, Bern, Waikerie, and Barmera in my area must look with a great deal of doubt to their own future as towns. The next time this
Government does something to help some of these people who really are at a poverty level today I hope we will hear a little bit less than what we heard about superphosphate and funds being given to rich farmers as this is becoming a patently absurd argument. I would ask reasonable members of the Opposition to acknowledge this fact.
– Order! The honourable member’s time has expired.
Mr FitzPATRICK (Darling) (5.38)-The honourable member for Angas (Mr Giles) spent a good deal of his time claiming that the September report of the Australian Industry Development Corporation was out of date, but he failed to inform the House where it was out of date or to what extent it was out of date. As a matter of fact he did not tell us anything about that report. One would have thought that if he is basing his opposition to the amendment moved by the honourable member for Blaxland (Mr Keating) on the report he would have submitted some information on just where the report was out of date. I hope to be able to produce some evidence to show that the situation is much the same today as it was last September, or for that matter as it has been for many years.
The honourable member spoke of overproduction. He blamed this on the Labor Government. But if one examines the records one will find that over-production has been with us for 10 years. The honourable member went on to talk about the dairying industry. He said that we should model some of these industries on the dairying industry. That is very surprising because the dairying industry is one of the most vigorous complainers about its financial situation. The honourable member then mentioned the costs under the South Australian Labor Government. He mentioned payroll tax, insurance and so forth. But of course we have all those problems in New South Wales under the Liberal Party and National Country Party coalition Government. We have also an extra levy imposed upon petrol which the Liberal-Country Party Government admits is an embarrassment. The Government is preparing to take it off before the State election. There is some indication that all these problems do not occur only under a Labor Government; they occur also under a Liberal-Country Party Government.
I wish to support the States Grants (Fruit Canneries) Bill, which will provide assistance by way of loans to the States of Victoria, New South Wales and South Australia for on-lending to the co-operative canneries to enable them to raise cash payments to growers for the 1974-75 season deliveries of apricots, peaches and pears for canning. I believe that at a time when traditional lending authorities are unable or unwilling to finance the canneries this Bill has much to commend it. It is only right that an industry which produces wholesome food which is grown under some of the best conditions in the world should be looked on with some sympathy when undergoing such financial difficulties. Indeed, when one considers the number of Australians dependent upon this industry for their livelihood one sees that it should be looked on with some responsibility by a national government.
I believe that it is in the best interest of Australia and Australians that such an industry should not be allowed to die for the want of some financial assistance. Surely ah industry such as the fruit canning industry, including of course the fruit growers, which employs directly and indirectly thousands of Australians should be supported by national and State governments. In any case, it must be remembered that this legislation provides only for a loan to be made which is repayable at an interest rate of 10 per cent. Already the industry has paid many millions of dollars into the treasuries of the State and Federal governments.
The Opposition supports this legislation but seeks to amend it by requiring the Government to implement the recommendations made in the report of the Australian Industry Development Corporation concerning the rationalisation of the industry. We asked for this to be done because we are conscious of the fact that for the fourth time since 1970 this Parliament has had to legislate for assistance to be given to the fruit canning industry by way of loans. In 1 970 a loan of $4.2m was provided through the Victorian Government to the Shepparton Preserving Co. Ltd. In 1971 a further $2.2m was provided from Canberra. In 1972 another $ 1.8m was provided. I must admit that this was made available in co-operation with the States and with matching grants being made by the States. I believe that this was a good thing because, as far as the Federal Government is concerned, when the States are of the opinion that the industry is worthy of support it should be half the battle. In November 1973 the currency realignment assistance of $ 1.5m was provided by way of grants to the canneries.
I believe that most observers would say that the industry has received its just share of assistance to put it on a sound footing. As sympathetic as the Opposition is to the plight of the industry, it also takes this view because it is aware that, even though all this assistance has been given to the canneries, the 1974-75 season has been predictably difficult. The serious price war between the canneries on the Australian market, which lasted for half of the 1975 season, has already been mentioned. This had a very disruptive effect on the market and brought about a large reduction in the returns from domestic sales.
It was gratifying to hear the Minister for Primary Industry (Mr Sinclair) inform the House that this problem has now been overcome and that some common sense is returning to the marketing of canned fruit. As the honourable member for Blaxland has stated, there seems to have been a flight from reality by the industry in not recognising the signs in the marketplace. Apart from measures such as eliminating price competition by the Australian canneries in the export market and selling under one label, there has been no significant attempt to restructure the industry. It is only because the livelihood of 2000 growers and their families, along with the workers in the canneries, is affected by these prices that the Opposition will support this legislation. However, it believes that the report by the Australian Industry Development Corporation which was commissioned by the Australian Labor Party Government should be considered immediately and not put off on the basis of securing an up to date report, as the Minister indicated in his second reading speech. Obviously, the factors affecting this industry have not changed since the report was completed.
The Opposition is conscious of an obligation to assist the industry. However, the industry must assist itself, and such activities as price cutting wars cannot be tolerated. We are told that they cost the industry between $4.5m and $6mmoney which it could ill afford to lose. While this is happening the industry cannot expect sympathy from the national Government or from the Australian taxpayer. I support the view expressed by the honourable member for Blaxland that more consideration should be given to the local market. It cannot be built up with poor quality fruit while the best of our fruit is sent hunting for an export market. A stable and larger domestic market would be the best base upon which to restructure the industry. It seems to be out of all balance when one considers that only one-third of the production finds its way onto the domestic market.
A report in today’s Canberra Times under the heading ‘A “promotional gimmick”: canned fruit at 25c’ contains a statement attributed to Mr Vanzella We must have another look at that proposition. The report says:
Australia processed 8 914000 basic cartons (24 cans to the carton) of fruit in 197S which was an increase on the 1974 total, in the same category. The 1974 figure was 7 543 000 basic canons.
It is understood that ‘almost half last year’s total . . . still remains unsold. The carryover position is aggravated this year because of the drastic reduction in export marketing outlets.
The report continues:
He pointed out that Australians consumed more fruit than people in the U.S. His figures showed that Australia produced 26 million bushels for its 13 million people, while the U.S. produced 140 million bushels for its 220 million people.
In other words, on a per capita basis, Australia is already consuming nearly four times as much canned fruit as America. That is an indication that perhaps the opportunity is not there to develop the domestic market as much as we would like to do it. Perhaps that is one of the penalties of having a large country with a small population. It appears to me that a good many of our production and marketing problems would be solved if we had a larger population. Taking those matters into consideration, it was gratifying to hear the Minister for Primary Industry inform the House that he has already commissioned the Australian Industry Development Corporation to update the report prepared last September. At least- if he does not accept this amendment- the report will be available shortly. It is certainly essential that all the parties concerned with the industry use their best endeavours to place the growing, canning and marketing sectors on a firm footing so that in the long term it will become a viable industry. The provisions of this Bill will give them another chance to do that. However, I believe that we should begin to apply some of the recommendations that already have been made by the Australian Industry Development Corporation. We must ask ourselves what good another report will do if we allow it to become outdated before any action is taken. I believe that the reports indicate that this industry has been in the same condition for a number of years and that the circumstances have not greatly changed. The honourable member for Angas made the claim that the industry had changed but gave very little indication of where it had changed. I support the amendment moved by the honourable member for Blaxland, which reads:
That all words after ‘That’ be omitted with a view to substituting the following words: ‘while not declining to give the Bill a second reading, the House is of the opinion that (a) the problems of the canned fruit industry are a legacy of the reckless overexpansion of the production base fostered by successive Liberal and Country Party governments throughout the 1960s, and (b) the Government should consider immediately the AIDC report handed down in September 1975, with a view towards significant rationalisation of this industry to prevent further hardship to growers and their families’.
-The necessity for this Bill to be introduced indicates the difficulties facing the canned fruit industry. As the Minister for Primary Industry (Mr Sinclair) pointed out in his second reading speech, the canned fruit industry is facing such acute financial difficulties at the present time that the major co-operative canneries have been able to pay growers to date only 40 per cent to 60 per cent, depending on the canneries, of the prices declared in 1975 by the Fruit Industry Sugar Concession Committee for peaches and pears.
The central reason why the industry is in such difficulties is one which threatens most of our rural industries, particularly the industries that rely on exporting. Like the beef industry, the domestic market is influenced by our export market. The fruit canning industry is under severe threat, as is also the fresh fruit industry. They are tied closely together. The basic reason why they are under threat is that we have priced ourselves out of the overseas markets. As the relentless push for higher wages, shorter working hours, better conditions and higher tariffs for the protection of our secondary industries has gained momentum over the last few years, so has the pressure mounted on our export industries. The canned fruit industry is perhaps the frailest of these industries; so today it is in extreme difficulties. It is not only the internal cost structure which is killing the industry. There are external pressures too. The greatest of these would be the increase in freight rates, especially to our traditional markets, and also basically our traditional markets being closed with an effective 25 per cent tariff against canned fruits exported from Australia to the European Economic Community. The change in currency rates, between both our customers and our competitors, has had a marked influence. One of our main competitors, South Africa, has recently devalued her currency by 17 1/2 per cent. The Israeli pound, as pointed out by the honourable member for Angas (Mr Giles), from September 1974 to February 1976 moved from 5.4 to the Australian $ 1 to 9.3 to the Australian $1. Also Israel, Greece and South Africa are closer to our traditional markets- the EEC- and therefore have a big freight advantage. To complicate the situation further, there are imports of fruit or fruit products such as apple pulp and juice into Australia which disrupt our domestic market and have an effect on the fruits the subject of this Bill.
Every way that one turns one sees a desperate situation which requires strong and sympathetic government action to support the industry and to assist the industry to rationalise. It is not only that part of the industry which this Bill deals with, namely apricots, peaches and pears, but also the whole fruit and vegetable canning industries that have to be considered. If the industry agrees, with Government guidance, to rationalise the canning of apricots, peaches and pears to limit production to the requirements of the domestic market, we would see some canners move into the production of apple pulp or vegetables with the inevitable result that these markets would become over-supplied, as some are today, and the traditional producers of these products forced into difficulties.
In Western Australia we have one canning factory at Manjimup which is in my electorate of Forrest. This cannery traditionally has canned peaches and pears but its main function has been the production of apple pulp. Hence my concern, with the thought of the rationalisation of peaches, pears and apricots, of other canners moving into the production of apple pulp. Since 1973, when the taxation incentives on fruit juice concentrates was removed, the production of apples and apple products in the electorate of Forrest has fallen dramatically. There was a 20 000-tonne capacity throughout this area. It has fallen to 5000 tonnes. If production falls any lower there is no chance that this cannery at Manjimup can survive. I believe that the canning industry and the Government should be concerned not only with special varieties of fruit as they are all intertwined and complementary to one another. It is just as difficult for the Manjimup canning factory to dispose of its surplus apples on the overseas market as it is for other canneries to dispose of their peaches and pears. It is just as difficult for the Manjimup canning factory to sell its product, apples, as it is for us to sell fresh apples overseas. The producers are the same. If the Government sees fit to stabilise the fresh apple product on overseas markets one could argue that it also should assist in stabilising the manufacture of apple products.
It is becoming increasingly clear, in both fresh fruits, apples and manufactured products, that we cannot compete on overseas markets. The trend has been visible for a number of years and a system of rationalisation should have effectively started and have been maintained 4 years ago. At that time the Government did introduce re-construction through the tree-pull scheme, but at the time industry leaders pointed out that the subsidy offered for tree pull was not a viable proposition and that fruit farmers would hang on in poverty in the hope of better times rather than accept the subsidy offered.
I know we have difficult economic times in front of us and any thought of more Government expenditure in any field has to be gauged with the utmost caution and deliberation, but here we have a section of the community which in years gone by has been encouraged to increase production and which now finds itself for all the reasons I have given in difficulty.
Sitting suspended from 6 to 8 p.m.
-Prior to the suspension of the sitting for dinner I was pointing out that this Bill deals with certain sections of the fruit industry, namely the canning of peaches, pears and apricots and I was endeavouring to point out the interrelationship of this section of the industry with the whole industry. I had been making a plea for government understanding of the need for rationalisation of the fruit industry. I know we have difficult economic times in front of us and any thought of more government expenditure in any field has to be gauged with the utmost caution and deliberation, but here we have a section of the community which has been encouraged in years gone by to increase production. At that time we had expanding export markets, but the industry now finds itself, for all the reasons I have given earlier, in dire difficulties. We must give it realistic support to overcome these difficulties.
If the Government does nothing more, or it does no more than what it has done to date with this BUI, there will be a collapse right throughout the fruit canning industry which will lead to tremendous social and economic problems in some areas, and these problems will reflect on the whole community. There will be people having to leave their farms, people going to the cities, people competing for services and goods in the cities in an already over-extended situation there, and people competing for jobs where there is already high unemployment. Realistic rationalisation has to be entered into with the industry by the Government. Surely it is better to rationalise the industry than to continue to subsidise it in a piecemeal manner at a cost to the taxpayer. The taxpayer will be called upon to continue to support the industry. There has to be a reasonably generous tree-pull scheme which will encourage people to get out of the industry and to leave them with some dignity and wherewithal to start perhaps a new vocation.
Preferably I would like to see this loan not subject to a means test in an endeavour to get production down. The whole canning industrynot only peaches, pears and apricots, but all the fruits, the most important of which I believe is apples, and vegetables- should be looked at. If production controls are placed on one section of the industry quickly canners will move to other products without any real consideration of the profitability of that move, but just to keep their canneries working to capacity, and they will disrupt their neighbouring industries.
The main throughput of Manjimup Canning Co-operative Limited is a solid pack pie apple. In Australia in 197S the production of solid pack pie apples was 20 000 tonnes. In that year there was a carryover from 1974 of 2000 tonnes, giving a total of 22 000 tonnes in that year. In 1975 the sales were 14 000 tonnes giving a carryover in 1976 of 8000 tonnes. One could suggest a maximum carryover as before of 2000 tonnes as a reasonable quantity, leaving an excess stock currently held of 6000 tonnes. Manjimup Cannery is holding two-thirds of its production from the 1975 crop at this moment.
If the industry does not get support it is doubtful whether the cannery could get Reserve Bank finance to produce the 4000 tonnes it anticipates manufacturing in 1976. If the cannery does not produce the minimum of 4000 tonnes the company is faced with the reality of closure. This would be disastrous for Western Australian apple growers who have already suffered by the closure of the concentrate industry. This 4000 tonnes compares with the 20 000 tonnes produced in 1973. The 16 000 tonnes difference is dumped or rots on the trees.
– Rots the tree.
-The honourable member for Swan would know the problems being faced in my area. Some form of voluntary and /or compulsory production control should be introduced to bring production more in line with local demands. This may have to be carried out over a one year or two year period so as to minimise the effect of the present large stock carryover of canneries depending on apple processing. It may be that this control would need to be a combination of both voluntary and compulsory controls: Compulsory control by the Reserve Bank to restrict excess production by the co-operative canners, and voluntary control by canners who, being largely confined to Tasmania and Western Australia- and I am speaking of apple pulp- have already indicated acceptance of such a scheme. As with our fresh apples and the stabilisation scheme which assists our exporters to export, consideration should be given to assisting the producing apple industry to remove the 6000 tonnes of excess stock currently held by producers in Tasmania and Western Australia. I know that the Government and the Minister who is in control of this industry are very aware of the problems that face it. I suggest to the Minister that an investigation should be made of the possibility of using not only surplus apple pulp but also surplus fruit as a foreign aid component. There must be areas throughout the world which need the assistance which Australia is in a position to give. They could benefit from aid provided in the form of solid pack pie apples and other surplus fruits. This is a real problem that the Government and the industry have to face.
In conclusion, Mr Deputy Speaker, let me say how disappointed I am to be making a speech which encourages government support for an industry and which suggests that we can no longer export, that there should be a complete control of production, manufacturing and sales within the industry, and that the Government should give the lead in this regard. To me, it is a frightening thing to be advocating the closing down of what has once been one of our good exporting industries. It is with a sense of doom that I think of the two-thirds of the world ‘s population that is under-nourished to one degree or another while we are advocating production controls. We are advocating that this industry can no longer export and that we should grow just enough for our own selves, for our own domestic market.
This is the frailest of our rural industries, but there are other industries that are not very far in front of it. We all know the problems associated with the beef industry, but the wool industry is only a whisker in front of the beef industry. If current claims by shearers were to be implemented, vast sections of our great wool industry would become uneconomic and then what would we do? Would we be advocating production controls or the closure of the wool industry? Would we be advocating the production of just enough for our own needs? I am concerned that two-thirds of the world’s population, which represents hundreds of millions of people, will not allow us, in the future, to keep this country with its great potential for the production of food and fibre, and perhaps we will not deserve our country.
-Mr Deputy Speaker, I support the honourable member for Blaxland (Mr Keating) in seeking to amend this Bill by asking the Government to carry out not only the short-term measures which are urgently needed but also the long-term recommendations which I believe are contained in the Australian Industry Development Corporation report and which, I understand, are subject to some amendment. We are faced here with a very serious human tragedy. It is the tragedy of perpetuating, by subsidy, a situation where a group of primary producers- people who have chosen that particular way of life and who normally would be expected to be regarded as landed proprietors running their own businesses- have degenerated into the position where their style of life is more in keeping with a feudal sort of peasantry. This is the human tragedy with which this part of primary industry and many other parts are faced. It is one which we must face. I do not think we are facing it the way we should. On paper these people have a very valuable asset in their orchards which most of them have been on for many years. They have poured profits into the orchards. The orchards represent very large investments, sometimes hundreds of thousands of dollars. This is an illusion. Quite often it is a worthless security which they have. It is one on which they cannot borrow and on which they are not making a living. If the financial institutions are not prepared to lend on this sort of security we must question the morality and the responsibility of using government funds to perpetuate the situation. That is precisely what we have been doing for years.
The other tragedy is that this situation has been quite apparent for many years. It is not something that has come to light in the last few years, as the honourable member for Angas (Mr Giles) seemed to imply. It has been there for many years, as I will point out later. Although the signs were there and it was apparent to people in the industry, we now face a situation in which about 80 per cent of this season’s crop is not sold. There is very little prospect of its being sold. It is being put on the shelf at considerable cost to the community. I submit that the whole thing is a fiasco. It represents a tragic misuse of the resources of this country- not only the physical resources such as the land, the irrigation water, the chemicals that go into producing the crop, the fuel that is used to cultivate the orchards, the tinplate to can the crops, the paper to supply the cartons, but also the financial resources of the Reserve Bank of Australia and many other banking institutions and other financial institutions. Most importantly and most tragically, it represents a misuse of human resources. People work on these properties for all sorts of hours year in year out. Yet they reach a standard of living more akin to that of a peasant than of a landed proprietor in our great Australian community.
The situation raises the question of responsibility. Where does the responsibility lie for this sorry situation? It lies in several areas. In one sense one can say that it lies within the industry itself. Surely it should have seen the writing on the wall; it should have advised the people concernedthe co-operatives, the canneries. There were plenty of messages for them that this situation was arising. Really nothing very substantial was done. They just went on living hopefully in a sort of illusionary world. I think there is a very grave responsibility on the Fruit Industry Sugar Concession Committee. I do not know on what rational basis this Committee should have recommended a substantial increase in price last year, when all the signs were that this could not be substantiated on the world market. I think there has been an act of irresponsibility there, a sense of wishful thinking that certain conditions that it wanted to happen would happen when there were no real prospects that they would happen.
The other area of responsibility where I think there has been very grave irresponsibility was the price war that went on last year between the various co-operatives and the private canneries. This is an interesting phenomenon because one sees here in action the philosophy of free enterprisethe survival of the fittest. So they have a great old price war in which everybody loses- nobody wins. I do not know whether they are influenced by the Prime Minister’s philosophy of the survival of the fittest, but certainly they tried it out. It did not work. It cost the industry $4m for a price war which was quite illogical and irrational. Having failed, they want a socialist solution to the problem. They want government subsidies. This is a quite interesting analysis of how the Country Party members think. They spout all these things about free enterprise, the survival of the fittest and open competition. Then, when that does not work, they come back to a socialist solution. This has been going on for years.
– But last night you wanted a socialist solution for Canberra. That was just a few hours ago.
– Well, I am consistent. I am saying that the Government Parties want it too.. The Labor Party is honest about it. We have always supported the socialist solution. We support the socialist solution for rural problems. The Government Parties pretend that they do not; but in fact they do. That is the difference. I am talking about responsibility in other areas. I think that the main culprit when it comes to irresponsibility is the Government itself.
– Which one? Mr FRY- I say that the present Government Parties have had a monopoly -
Mr DEPUTY SPEAKER (Mr Lucock)Order! I think that the honourable member for Fraser might be left to make his speech on his own, without interjections.
-The Liberal National Country Party Government has not proceeded with a restructuring program. In fact it has encouraged expansion at a time when there was no rational reason why it should. There is no question but that if governments build into people an expectation that they will get subsidies year after year then naturally there is some encouragement for them to expand rather than encouragement for them to cut back on production, which is what should have been happening. The Government cannot claim that it did not know the situation or that it was not warned. It has been spelt out many times in the industry’s own journals. I quote from the 1970 report of the Australian Canned Fruits Board- that is 6 years ago. The report states: … the Board has been advocating caution to growers contemplating new plantings, and at the risk of sounding repetitive, attention is drawn to the doubtful prospects of marketing additional quantities. Despite efforts over an extended period by the Board to expand existing markets, and efforts by canners to develop new markets, the prospect of disposing of annual production at its present level is not encouraging if economic returns for both canner and grower are to be obtained. In common with other Australian primary industries there is a need for reconstruction at the primary level.
That was in 1970. Yet our friend the honourable member for Angas (Mr Giles) has tried to tell us that everything was lovely then and it is only in the last few years that this problem has developed. It has existed for 10 years and the Government really has done nothing about it. We were in government for only 3 years. The present Government parties have been in office for the rest of the time.
The other proposition that has been put is that because our wages are high we cannot compete with overseas countries. Are honourable members on the other side of the House suggesting that our labour standards should be such that we can compete with cheap, peasant, coloured labour in South Africa; or are they suggesting that we should compete with the very low standard of living in Greece? Of course they are not. If we cannot compete with other countries on our standard of living, if we cannot compete on the basis of our natural resources, which are fairly extensive, if we cannot compete by adopting the latest technology and innovation, then we should restructure. That is what this industry should be doing. The other suggestion of propping up the industry is quite irrelevant. That is just fiddling with the problem. Certainly in 1972 the Government did act in a reconstruction scheme and there was some success with the tree pulling scheme, particularly with peaches. Unfortunately, there has been little success with pears. In Tasmania the scheme certainly has reduced production and has allowed some people, such as old people and widowers, to get out of the industry with something. So, in that respect the scheme has been fairly successful. There seems to be some reluctance to go on with that scheme, but in principle it is much better in the long term to pay people to pull the trees out than to keep on producing something and wasting resources on something which they know they cannot sell. We have to face up to that situation. The Industries Assistance Commission report recommended a short term continuation of this program, which the Opposition is supporting tonight; but the Commission also asked that a complete and thorough investigation be made of the whole industry.
Then I come to the Australian Industry Development Corporation report which was commissioned by the Labor Government and which for some reason or other this Government is sitting on. I do not accept the claim of the honourable member for Angas that it is not up to date. No report is up to date. It will never be up to date. There is no need for it to be that up to date because we know the problem has been there for 10 years. Bringing it up to date will not change the problem. Certainly some adjustment may be made to the means that one uses to deal with the problem. But perhaps the secrecy about this report is somehow connected with the fact that it may recommend some rationalisation between co-operative canneries and some big public companies. I appreciate the fact that the Government may want to protect the interests of the share holders of those big public companies and so does not want to make public in advance any proposition that it may be recommending an amalgamation of canneries.
There is no question about the Labor Party’s support of the scheme to give immediate relief to these unfortunate people who are caught in that position. We do not want to see any sector of Australian primary industries reduced to a state of peasantry, and that is what is happening to many of them. We want to see them saved from that situation, but we do not want to see them saved just for this time; we want to see them given assistance. We want to see the people involved retrained and compensated to get out of the industry if that is the only alternative. There are other alternatives to production on this type of land. I do not accept that all our primary industries are bankrupt. We are still importing considerable quantities of primary products.
-What are they?
Mr DEPUTY SPEAKER (Mr Lucock)Order! According to the list before me the honourable member for Murray is listed to speak next in this debate. I suggest that he keep his remarks to himself until he is making his speech to the House.
– I conclude by saying that there are alternative uses for this land other than the growing of crops that cannot be sold. I do not accept that all our primary industries are in a state of bankruptcy. We still import some primary products. We still import soya bean meal and soya bean oil, which, if the right resources were put into research, I think could be grown in this country. We have been fiddling with that for many years but we have not got any great results. However, I think there are prospects for that particular crop. There are other new avenues which also should be expanded. I do not accept that that land cannot be put to any other use if the trees are pulled out of it. The great problem in orchards, of course, is that it always takes a long time and a lot of investment before the trees even start bearing. I know that people who have made plantings, and who have put the investment into those trees are very reluctant to pull them out. But the reality of the situation is that there is no use growing produce that cannot be sold on the world market. It was quite obvious many years ago that the European Economic Community would gravely affect our export of primary products and it is time we faced up to the reality of the situation and got down to retructuring these industries in a practical way.
– I congratulate the Minister for Primary Industry on the speed with which after 13 December he responded to the industry’s call for help. He reconsidered a badly conceived proposal. He obtained the cooperation of 3 State governments, and he has introduced legislation into this Parliament, all in a short period of time. Many ill considered statements have been made so far in this debate, including the wording of the Labor Party’s amendment. I want to answer those statements by reminding those honourable members present of developments in the industry and in Parliament over the last few years. The industry was a most prosperous one in the 1950s and the 1960s. There was a pack of about 10 million cartons, of which 70 per cent was exported. Four million cartons went to the United Kingdom alone at very profitable prices.
The first crack appeared with Britain’s devaluation in 1967, which in itself makes a mockery of suggestions that there was a 10 year crisis. Later Britain entered the European Economic Community, but exports continued at much the same rate until the 1970s. Then in the early 1970s, for a variety of reasons, they dropped from about 4 million cartons a year to the United Kingdom to 2!6 million cartons. Contrary to the Labor Party amendment- which claims that the Liberal-Country Party here in Canberra recklessly fostered over-expansion- I remind all honourable members of the warnings given in this place by my predecessor, Sir John McEwen. in 1965, after Britain’s second unsuccessful attempt to join the European Economic Community, he warned the canning fruit industry of the danger of increased plantings. However, the management at that time in control of the SPC Ltd cannery, was not very keen to listen to these warnings. It gave contrary advice. We all know what happened to SPC Ltd a few years ago. Fortunately its management now is very good.
The closer settlement policies of the Victorian Government at that time also were contrary to the warnings given by the Federal Government. These policies were contrary both in the dairy industry and in the fruit industry. In fact, the Victorian Government is still fostering closer settlement for dairying at this time of crisis for this industry. With the contraction of the United Kingdom market the previous Liberal-Country Party Government in 1971-72 introduced a treepull scheme. Its main objective was to reduce the acreage of fresh apples and canned pears to adjust to the reality of Britain’s entry to the European Common Market.
One of the problems facing fruit growers was a severe means test. The Minister for Primary Industry (Mr Sinclair), who was the Minister also at that time, on two occasions eased the means test but it was still a very difficult test for a person to pass. It was not helped by the Victorian Government’s initial lack of flexibility in applying that scheme but credit should be given to the Victorian Government for its assistance with the scheme. We hope that it will assist in making the new scheme a success. Nevertheless, acreage was reduced.
In the 1972 election the Labor Party, particularly its spokesman on agriculture, Dr Rex Patterson, said in the House during the debate on the Bill that Labor would ease the means test on the tree-pull scheme to make it easier for people to remove fruit trees. In fact, in my electorate, because of the concentration of Labor support and its promises of easing the means test, the 1972 election became known as the rotten fruit election. What happened after Labor was elected in December 1972? Absolutely nothing happened. The Labor Party did nothing to improve the tree-pull scheme. I suggest that the 2 Labor spokesmen on this matter might do well to remember that the Labor Government ignored the requests of fruitgrowers for an easing of the means test so that the fruit acreage could be reduced in the Goulburn Valley. It reneged on its promise made in the 1972 election. Members of the Opposition should not criticise fruit growers or the Liberal-Country Party Government for a lack of reality in reconstruction and diversification.
Let us have a look at diversification in which the Labor Party was interested at that time. The Ardmona Fruit Products Co-operative Ltd spent more than $2m in installing a fruit juice plant of the most modern type in the world to concentrate a variety of juices- particularly pear juices- so that more pears would be utilised. That cannery had just signed a contract with a well-known soft drink manufacturer for the use of pear juice in soft drink when the Labor Government, in its 1973 Budget, abolished the sales tax exemption for aerated waters when 5 per cent of fruit juice was added.
Members of the Labor Party should not talk to the fruit industry about what it did not do to help itself with diversification. The Labor Party caused a capital loss of $2m- in a cannery that had been encouraged to diversify. In 1973 when the Labor Party was in government it said: ‘We will compensate the industry $5m for its loss of sales for fruit juice’. Very little of that $5m compensation has ever got through to the fruit juice industry in Victoria, Tasmania, Western Australia or New South Wales. None of it, to my knowledge, has reached the Goulburn Valley. I would like to know what happened to that $5m. Perhaps the Labor Party could tell me. Is it a fact that most of that $5m was diverted from fruit juice compensation by the Labor Government to assist the price for exported apples from Tasmania in early 1975? This is what the industry believes. If that is the case it certainly did not do the Labor Party any good because it lost all its seats in Tasmania. But what a sellout for an industry which the Labor Government told to diversify. The industry diversified and that Government removed the incentive which caused it to diversify. It then promised compensation but never provided it. What a cheek the Labor Party has when it tells the industry that it has not been trying to do things to help itself.
In 1974 there was a respite in this problem of fruit marketing. Many in the Labor Party were quick to claim credit at that time and say that because of their policies we were able to sell all our agricultural products around the world. They were not saying at that time that there was an over-production of canned fruit and, therefore, that the acreage should be restricted. By 1974-75 the pack had not increased; it was down to 8 million cartons. Exports were down to about 4 million cartons, of which the United Kingdom took about 2 million, or a little over 2 million. In other words, there had been a considerable adjustment in a few years. I want to remind Labor members here that fruit is not an annual crop that is planted and reaped at the end of the year. There is a long waiting period between planting and picking. There is a very real problem also in deciding whether to accept that there is not a future market or to continue in the hope that there might be a market again in a year or two. If a grower does pull out the trees he has had it for another six or seven years, if he has not gone bankrupt in the process.
In 1975 there was a price war with a further collapse in overseas markets and $3m to $4m was lost on that market. Which party formed the Government at that time? It was our friendly, famous Labor Government in Canberra. What did it do to bring the industry into line? It had power through the Reserve Bank advances to stop that price war but it did not do so. It is of no use the Labor Party criticising the fruit industry for that price war.
Let us consider the reasons for the loss of those overseas markets during the 1970s. The first and most important reason, definitely, was Britain’s entry into the European Economic Community. We changed from a situation of tariff preferences in our favour to preferences and levies against us. The second reason was increased freight rates. The third was devaluations- and this was probably the most important factor. These devaluations have occurred between ourselves and the United Kingdom, between South Africa and the United Kingdom and between ourselves and South Africa. As a result, in a little over 3 years the price at which South Africa could sell fruit on the United Kingdom market dropped in relation to our price by over 30 per cent. What other industry in Australia could withstand that sort of competition brought about by devaluations? It resulted in a differential of over 30 per cent in 3 years. I wonder how a Public Service would get on with that sort of drop in 3 years.
The fourth reason was runaway inflation in Australia, fuelled and stoked by the Labor Government. Our inflation rate was particularly high when compared with the rate in South Africa and the United States, our 2 major competitors. The fifth reason was wage decisions in Australia. In one year the wages for female employees in the canneries- they are the major employees in the fruit canneries- increased by over 50 per cent. How can an industry quietly accept that situation and still be profitable? In the latter half of 1975 there were 2 developments- the Australian Industry Development Corporation investigation and fruit loans. I want to compliment Senator Wriedt, the then Minister for Agriculture, for commissioning the AIDC investigation. I think it was an important development. That report was available in September but the Labor Government did nothing with it. To my knowledge it was not presented to Cabinet, it was not presented properly to the industry, and in fact it was a secret document. It still is, unfortunately. There was no indication at that time of acceptance either by the Government or by the industry that the proposal would solve the problems of the industry. That proposal is now out of date. It is out of date because of the South African devaluation in relation to the United Kingdom in September and the United Kingdom devaluation in the last couple of weeks. Before these things happened fruit industry people were estimating that it was possible stall to export a million cartons of fruit to the United Kingdom. Now there is no market in the United Kingdom which provides a profitable return for Australian canned fruit exports. In approximately five to six years our market in the United Kingdom has dropped from 4 million cartons to no market. The adjustment required in that respect alone is tremendous.
This year approximately 6 million to 6’/i million cartons of canned fruit will be produced in Australia. That production has fallen from 8 million cartons last year and 10 million cartons a few years ago. Next year production is estimated to be down to 5 million cartons. There has been a contraction of tremendous magnitude in a few years. No increased production of canned fruit occurred in the period to which Labor Party spokesmen referred. As I said, there has been a considerable contraction in production.
That fact together with the new situation resulting from devaluation, from what we can understand of the Australian Industry Development Corporation report, will affect the number of canneries that would still be viable in a future canned fruit industry in this country. When the present Minister for Primary Industry was informed that the canneries could no longer accept that report as a basis for any negotiations, to his credit he called, early this year, for an updating of that report. There has been to my understanding one complication since then in that Manjimup has now been included in the new report. It was not in the original report. I understand that the updated report is completed. I hope that it is printed and now is ready for release, and that as much of it as possible is made public in the near future. I hope that it is not kept secret as the previous document was.
The second development was the fruit loans. For some months in the latter half of 1975 the Labor Government had a proposal before it. It did nothing with it. The matter was passed on to the new Government. The proposal consisted of a reduction to 70 per cent in the official fruit price, a 2-year repayment period, and a first call by the Government on that repayment rather than further advances by the canneries. That proposal was unacceptable to the industry. I hope that this experience is a lesson to the Department of Primary Industry. It demonstrates that it should discuss such proposals more with the industry concerned than it does before they are presented to the Minister.
After State and Federal members of Parliament and industry leaders pointed out the unacceptable features of the scheme the Minister, to his credit, changed the terms of the proposal. The price was reduced to 85 per cent of the original price. In his second reading speech the Minister made it clear that canneries are expected to pay above the 85 per cent if they are able to. Of course legal action can be taken by any grower when less than 85 per cent is paid. Unless he has signed a document which some canneries are forcing growers to sign- by doing so, a grower signs away his entitlement to payment above the 85 per cent- a grower can probably take legal action for the final 15 per cent payment. But, to be fair to the canneries, they must remain viable if the fruit industry is to be sustained. The reduction in the official price certainly has reduced the loss significantly in the 3 canneries in the Goulburn Valley.
– They would have to pay more than 70 per cent, would they not?
– Yes. There is the requirement of 85 per cent being the official price.
– That is not in the legislation.
-Well, I do not think it has to be because there is always the requirement that they must pay the Fruit Industry Sugar Concession Committee price. Now, the repayment period for the loans themselves was increased to 2Vi years. Hopefully, as the honourable member for Angas pointed out, the repayment holiday for the first 12 months should allow the canneries to make further payments beyond 70 per cent. But the point I make is that this, after all, is only a loan. It is a loan at 10 per cent. It is not particularly generous when one compares its provisions with those detailed in the Superannuation Bill which is designed to provide superannuation benefits for Commonwealth employees and which was introduced today. Those proposals were an example of a subsidy if ever there was one, and an unfair one by private sector standards. So I do not believe anybody in the hallowed halls of Canberra can talk about subsidies available in other areas of Australia.
Now I wish to refer to the point made by the Opposition spokesman on agriculture with respect to the consumption of canned fruit in Australia. Our consumption is the second highest in the world, I am told, after the United States. The figures provided earlier were in relation to production on the basis of population, not consumption. There are no figures to indicate that consumption increased as a result of the price war. In other words consumption is almost as high as it possibly can go. Contrary to what the Opposition spokesman said, virtually all of the pack is of export standard. Anything bought through the ordinary shopping system would be of export standard.
The industry is putting its house in order and has been for several years. Just recently an equalisation and domestic price agreement was reached between the major canners. I understand that as a result of the Canned Fruits Board meeting today the domestic price agreement document is being forwarded to the canneries tomorrow. Also there has been established a body called the Goulburn Valley Canners which will provide a single marketing arrangement for SPC Ltd, Ardmona Fruit Products Co-operative Co. Ltd and Riverland Fruit Products Cooperative Ltd to reduce the overheads in that area. In addition Henry Jones and Co. Pty Ltd and Kyabram Preserving Co. Ltd have linked up for single marketing. A question mark must be placed beside Letona ‘s ability in the future to remain out of a marketing arrangement for efficiency’s sake. The grower organisations have called a number of meetings to demonstrate their sincerity in reconstruction in the industry. They called a meeting of all the co-operative canneries some time ago on the question of price-cutting and equalisation. They had a mass meeting in the Mooroopna area recently in which they asked the growers to put direct to the canneries what are the requirements of the fruit industry from a grower point of view for the sake of the industry.
Certain points are clear. One is that there has been contraction in production for some years. As I said, next year production will be 5 million cartons, which is down from 10 million cartons only a few years ago. And remember that fruit is not an annual crop. The industry in my view has been responsible; it called for a tree-pull scheme. Admittedly the original tree-pull scheme was to be more generous but when State governments would not assist with it a harsher means test was required. The industry itself wants a tree-pull scheme and I hope that the Minister for Primary Industry will be reintroducing a tree-pull scheme as soon as possible because there has to be one in operation by May when spraying and pruning become essential. But I hope that it will be more flexible and more appropriate than it was last time. It will be difficult because alternative land use at the present time is virtually non-existent. The honourable member for Fraser (Mr Fry) should learn a little bit more about climatic variations and requirements for soya beans before he starts talking. The last time the tree-pull scheme was in operation there was the alternative use of land for dairying and beef. Those alternative land uses are not there. Nevertheless, the industry must contract and the industry recognises this and will, but Government itself must help.
Original question resolved in the affirmative.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Sinclair) read a third time.
-! have received messages from the Senate concurring in the resolutions of the House relating to the appointment of Joint Committees on the Parliamentary Committee System, Foreign Affairs and Defence, the Australian Capital Territory and the New and Permanent Parliament House and agreeing that the resolutions have effect notwithstanding anything contained in the Standing Orders.
Bill returned from the Senate without amendment.
Debate resumed from 4 March, on motion by Mr Sinclair:
That the Bill be now read a second time.
- Mr Deputy Speaker, with the indulgence of the House I should like to raise a point of procedure on this legislation. Before the debate is resumed I would suggest that it may suit the convenience of the House to have a general debate covering this Bill and the Dried Vine Fruits Levy Amendment Bill as they are related measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest, therefore, Mr Speaker, that you permit the subject matter of both Bills to be discussed in this debate.
-Is it the wish of the House to have a general debate covering the 2 measures? There being no objection, I will allow that course to be followed.
-The purpose of the Dried Vine Fruits Stabilization Amendment Bill 1976 and the Dried Vine Fruits Levy Amendment Bill 1976 is to extend the dried vine fruits stabilisation scheme for another 12 months. The Opposition supports both Bills. The present stabilisation scheme was operative from 1971 to 1975 and was introduced after proposals were put to the industry and supported by it. The previous Labor Government supported the scheme to stabilise this important industry with a contribution of $390,000 paid to the fund for the 1974-75 season. In the middle of 1975 when the previous Government realised the scheme would require reconsideration for possible extension, the then Minister for Agriculture, Senator Wriedt, arranged for a reference to be placed before the Industries Assistance Commission for a report and recommendation as to the future of the stabilisation scheme. The IAC in its interim report recommended the extension of the existing dried vine stabilisation scheme for the 1976 season on the same basis as the previous 5 years.
The principles of this stabilisation scheme are in line with other orderly marketing or stabilisation practices inasmuch as where there is a variety of fruits involved a separate fund is mounted in respect of each commodity. Under this scheme a separate fund exists for sultanas, currants and raisins. A base price is established under the scheme each year for the various varieties of fruit by an assessment by the Bureau of Agricultural Economics as to the increase in the production costs of the grower. When average returns as calculated under the plan fall below the base figures by more than $10, a stabilisation payment is made. If the average return is exceeded by the basic price by more than $10 a levy operates. In both instances there is a maximum level of contribution payable by both the grower and the Australian Government.
To date the stabilisation scheme has had only a small impact upon industry returns but the scheme does provide a degree of protection at a time when world production of dried vine fruit is unstable and where prices can vary by a large degree depending upon supply. For instance, in 1971- 72 the Australian Government contribution to the fund was $276,000 when the total value of production that year was $34m. In 1972- 73 the contribution was $850,000 against a production value of $29.7m. In 1973-74 it was $390,000 against production of $36.3m, while in 1974-75 there was no government contribution at all. However, the IAC notes in its report that the international market is likely to be oversupplied in 1976. This may lead to a diminution in prices at a time when production costs are still moving up commensurate with a high level of inflation, so a sizable government contribution may need to be made to the fund in 1 976.
An indication of the volatility of export prices can be seen from 1972 onwards. In 1972 the f.o.b. price per tonne was $263, while in 1973 it was $611, in 1974, $584, and in 1975 it looks like being something less than $440 per tonne. As domestic consumption accounts roughly for only one-third of production, the effect of significant movements in export prices has dramatic consequences upon returns. Domestic prices have moved up constantly since 1967. Over the last 3 years the domestic price of sultanas was $583 in 1973, $694 in 1974 and probably around $835 for 1975. If, as expected, the northern hemisphere crop is larger than that of 1975 there will probably be a downward impact upon export prices and consequently grower returns. In these circumstances the Opposition believes that the extension of the scheme is warranted at least for 1976 and maybe further. The estimated 5500 growers in the industry do not enjoy a high level of income from this industry. According to a BAE survey, net farm income averaged over the 1971-72 to 1973-74 season was of the order of $4,500 per annum while 20 per cent of the growers were around the $2,000 per annum income mark, which is less than subsistence level. The IAC final report should shed some light on what recourse is available to these people.
The Labor Party has always supported the principle of stabilisation and orderly marketing. The major stabilisation schemes- the wheat stabilisation scheme and the wool floor price scheme- were the products of Labor legislation. We support the extension of this scheme. The Opposition also looks forward to the early tabling of the IAC final report on the dried vine fruit industry and the Government’s view of its recommendations. Finally, the Opposition supports both Bills, including the conversion of quantities and units referred to in the legislation to metric units.
-Mr Deputy Speaker, I should also like to give my support to the Dried Vines Fruit Stabilisation Amendment Bill and its associated Bill, the Dried Vine Fruits Levy Amendment Bill. I will not describe, as the spokesman for the Labor Party, the honourable member for Blaxland (Mr Keating) has just done, the stabilisation scheme, which he did entirely accurately and which I think all of us who have debated this Bill for some time have also done. It has got its built-in protective measures, both for the Government on the one hand and for the growers on the other. The focal point of the stabilisation scheme is the annual base price. I think it is important for the House to remember that contrary to the Bill that we have just finished debating, the Bureau of Agricultural Economics makes an annual review of the annual base price for each variety of dried vine fruit on a seasonal basis and movements in grower cash costs are therefore taken into some form of account. That is the big difference.
Yet, if we look at the Industries Assistance Commission report produced recently we find general acceptance by both this House and the Commission that the scheme tended to iron out the great fluctuations that occur. In any industry that is primarily or traditionally an export one, there violent fluctuation are ironed out although it has not done much really to lift the income of the producers. I rather felt that the figures that the honourable member for Blaxland just cited did not assess the fact that many dried fruit growers in my area, contrary to, say, Mildura in the electorate of Mallee are from fruit salad blocks. By this I mean that they are not 100 per cent dried fruit growers as was traditional in that area. I can remember Winton Turnbull in his annual debate on this matter, and I expect the position has not changed a great deal, although the member has representation now from that area.
I point to that difference because it is all very well for the honourable member for Fraser (Mr Fry) saying a little while ago that perhaps governments have poured good money after bad. It is a totally different ball game from this Bill to the one before and the only thing that I regret is that we have not got an industry leader today to compare with Sir Eugene Gorman who almost single-handedly forced an illogical group of exporters- unbelievably the Greeks, the Australians and the Turks- into the International Sultana Agreement. The very reason for the growers voting against the stabilisation scheme in the early 1970s was the fact that the International Sultana Agreement stuck and did away with the need for this type of legislation. After the international agreement fell apart for reasons that will be fairly obvious, bearing in mind the 3 parties to the agreement, the growers immediately went back to the Government and sought the re-introduction of the stabilisation scheme. The honourable member for Blaxland gave the historical dissertation of the pay-in or the payout over the 5 year periods for which this stabilisation scheme has applied. I ask honourable members to bear in mind that the Government in this case is carrying out the IAC recommendation to continue the scheme for the year 1976 until more rational, accurate and proper measures of reconstruction can be properly considered.
In the case of currants and raisins, the home market demand, I believe, will not require any Government pay-in to the separate pools. The case of the sultana pool is markedly different. Honourable members will be aware that the gordo grape and the sultana grape are in the dual variety category. When there is a demand for wine grapes these varieties can be sold to winers with a lot less work by the grower. They can be put straight into the wine industry in bulk. This very fact has completely altered the pattern of production in the Riverland end of my electorate and, perhaps to a slightly lesser extent, in the electorate of Mallee. So today the local economy of the towns is not so much dependent on dried fruit. The economy depends more on the success of the wine industry insofar as that industry frequently uses sultana and gordo grapes for a wide variety of measures. One can trunk of the favourite wine of the honourable member for Wakefield (Mr Kelly), the Fruity Gordo from Berry. One can think of the use made of the sultana grape in varieties of wine which are sold under labels from reisling to tokays
Of course, sultana grapes are used also in spirit manufacture. The Labor Government so thrashed the brandy industry that it now does not represent a pool where one can put surplus grapes. This very year thousands of tons of grapes still do not have a home. In the past one would have turned those grapes, which in the old days would be largely doradillo, sultanas and gordos, into spirit and that spirit would have been used for fortification on the one hand and the production of brandy on the other hand. But thanks to the withdrawal of section 3 1 A by the Whitlam Government in the past and, the 213 per cent increase in excise on brandy in a space of 13 months, there is virtually no brandy industry left. Imports are soaring into this country at an increasing rate at a cost of production way below the Australian cost. The answer to the cost of production is rather as I suggested in the previous speech I made. Many of these country industries have been put in a completely uncompetitive position by the huge increase in costs which cannot be carried through to the export market. Even if there is a demand we are no longer in a competitive position to sell on export markets. That is the point that should be driven home in relation to this matter.
The sultana pool this year will have different factors involved from those of the past. The South Australian Government has a price control structure on all grapes. I think from memory the price of sultanas was about $92 a ton in South Australia but they were selling interstate, in the areas of some of my colleagues, at a very much lower price. When it looked as though there would be a surplus of grapes, proprietary wineries in New South Wales, Victoria, and indeed, South Australia did not tend to take up the surplus sultanas produced in South Australia. They were able to buy very much more cheaply outside South Australia. In passing, I suggest that all States should look at some form of price fixation for grapes because the cost of grapes, frankly, is a very small element in the final cost of production of a gallon of wine, or whatever it might be, and it is absurd when one State fixes its price perhaps too high, as did South Australia, and over the border all firms take a competitive advantage- mild though it might be- by buying outside that State.
That was the position about 3 months ago. Everyone was fearful that bigger quantities of sultanas than usual would be dried and would go into the sultana pool, which we are discussing here tonight, because of the surplus grape supplies not taken by the wine industry. In fact, quite late last year the consumers took a hand. They decided, I think probably for incorrect reasons, that dry white wines were better for executives’ health than dry red wines. So all of a sudden the pendulum swung. This is an example of the difficulty facing growers of these sorts of fruits and horticultural products. All the sultanas were snatched up at any price and now in the grape growing industry generally, of which the sultana pool is an integral part, there is a surplus of dry red grapes. The surplus exists in shiraz, cabernet sauvignon and varieties that all growers were being encouraged to plant only a few years ago by the industry and by every expert in the land, if not by the Government.
This again highlights the fact that planting grapes or fruit trees is not like planting a turnip or a Murphy. As the honourable member for Murray (Mr Lloyd) said, grapes are not an annual crop. They are at least a 5-year venture and preferably a 15-year one so that the grower can get some return for the cost of establishing his orchard. Anything that any honourable member can suggest will receive a hearty nod from me if he acknowledges the fact that it is not easy for growers of any fruit products to exist when new habits and trends emerge, sometimes one would feel almost in a whimsical fashion, about which the growers can do very little.
I will finish my remarks at this point because I know that there are other members who would like to say a few words on this subject. There has been some bad news for the dried fruit industry in the last few weeks, emanating from the Sydney market where Turkish sultanas are selling at a price assessed to be well over $100 below the Australian price. One can take the view that the consumer therefore is in a position where he can profit by those lines being on the market. Normally I would be mildly inclined to this view, but this is not the time when any member of Parliament who wants populations to exist outside the metropolitan area can afford to take this purist view. I think it was the honourable member for Fraser who in the last debate compared slave conditions in some countries where the cost of production was very low with Australian conditions. If I am apt to blame the Australian Labor Party for the increased cost of production in Australia, I hope the House will forgive me. I have given an instance of grapes coming from another country where the cost of production is infinitely cheaper than it is in Australia. Whether or not protective barriers should be put up against Turkish sultanas I do not know. I just get back to the point I was on S minutes ago: I deeply regret the fact that I cannot see on the horizon a person such as Sir Eugene Gorman who can concoct an international sultana agreement that will stick.
Mr FitzPATRICK (Darling) (9.5)-The honourable member for Angas (Mr Giles) mentioned the problems concerning varying prices for fruit in different States. One must agree with his remarks that fruit which is being shipped over the border seems to be causing some problem in the dried vine fruits area. But I believe that one of the greatest problems in the dried vine fruits area is in regard to over-production and the lack of agreement with the States about new plantings. I feel sure that investigation of the history of the dried fruits industry would indicate that new plantings have caused greater over-production and problems than the problems indicated in the remarks made by the honourable member for Angas concerning the excise on brandy. This has been a bone of contention with the Australian Dried Fruits Association for a long time. At no time has the Association been able to obtain agreement between the States on new plantings. Until such time as the Association obtains this agreement, at times when the export market is not buoyant there will always be this trouble with over-production.
I support the Dried Vine Fruits Stabilisation Amendment Bill and the Dried Vine Fruits Levy Amendment Bill to extend the dried fruits stabilisation scheme to cover the 1976 crop. Nevertheless, I point out that the extension for 1 year of the maximum payment of $23 a tonne, coupled with the tonnage limitation for qualification under the stabilisation scheme, leaves a lot to be desired and represents a blow to the growers who are expecting the Government to give them something more than token assistance. The Dried Vine Fruits Association made a submission to the Industries Assistance Commission asking for the maximum payment to be increased to $33 a tonne. It seems very contradictory to me for the present Government not to take into account the things that Government members are always mentioning, namely, the rate of inflation and the vastly increased cost of production. This is especially so when one remembers that when honourable members opposite were in Opposition assistance to the rural industries was one of their greatest cries. It appears to me that when honourable members opposite are on one side of the House they use one argument and when they move to the other side they use a different argument altogether.
One might well ask: Has the present Government suddenly reversed the rate of inflation or has it found a way to reduce the vastly increased cost of production. If the Government has found a way to do this the Minister for Primary Industry (Mr Sinclair) never told us about it in his second reading speech. As a matter of fact, he indicated that the trend was in the opposite direction. I read from part of his speech as recorded on page 554 of House of Representatives Hansard of 4 March 1976:
The IAC noted that while the scheme has historically had little impact on the stability of the growers’ return, the international dried vine fruit market was likely to be oversupplied for 1976, while grower production costs are expected to increase further in 1 976.
That is a clear indication that the Government does not expect the inflationary spiral or costs to be reduced in 1976 because the Minister said: . . . while the grower production costs are expected to increase in 1976.
The Government’s decision not to raise the stabilisation price was a severe blow to.the industry and it has placed the burden back on the grower while everyone else is receiving increases in income. It must be remembered that even during the last 12 months fruit picking costs have risen by about 25 per cent. This is not the fault of the grower. In comparison with other occupations the occupation of fruit picker is not highly paid. The work is very arduous. Very often the grower finds it difficult to obtain pickers. During years when there are adverse seasons or when it rains, the size of the bunches of grapes is reduced and it is extremely difficult for the contract pickers to get a decent wage. This again, of course, makes it difficult for the growers to obtain fruit pickers. In addition, the grower has to meet higher packing and freight rates, plus an unusual increase in dip materials, to say nothing of the increases in fuel, tyre repairs, spray, water rates and shire rates. In fact every cost in connection with living on a fruit block and producing fruit has risen.
The Bureau of Agricultural Economics figures show that since 1971 labour cost has increased by 87.6 per cent; farm cost for plant by 57.74 per cent; and farm capital by 83.2 1 per cent. The cost of production on which the stabilisation plan is based is in 2 sections, namely cash cost and constant cost. Whereas the cash costs are indexed forward each year according to the movement in the particular item, the so-called constant cost has remained unchanged at $119.88. Yet the cash cost has risen from $153.11 in 1971 to $283.04 in 1975. If the so-called constant cost had been indexed one would have expected it to rise at about the same rate. The Australian Dried Fruits Association’s journal of February 1976 claims that this $119.88 would have risen to $2 1 1.35 per tonne. We have not heard any argument against these figures put out by the growers’ representatives. It is hard to understand how an argument could be put against them.
Why should the owner-operator allowance remain constant at $62.15 from 1971 to 1976? How can depreciation remain constant at $36.54 from 1971 to 1976? How can the interest on farm capital remain at $2 1 .20 from 1 97 1 to 1 976? This amount of money would not even pay the interest on a rusty push bike. I believe that some of these things are worth mentioning; otherwise the House could get the impression that the dried fruit industry is seeking a handout at the expense of the taxpayer.
Although the Minister has said that the dried vine fruit stabilisation scheme provides for the establishment of an annual base price calculated each year according to the movement in the growers’ cash cost as assessed by the Bureau of Agricultural Economics, it is hard to understand how the arrangement is applied on this occasion. When one takes into consideration the report of the Industries Assistance Commission that the dried vine fruit markets will be over-supplied in 1976 and the fact that growers’ costs are expected to increase further one can realise that the future of the industry does not look very rosy. In addition, the Minister for Primary Industry (Mr Sinclair) has said there is little doubt that considerable adjustment will be necessary in the next few seasons and that these adjustments will have regional implications. I believe that if the industry had more information on the form that these considerable adjustments would take and which regions would be implicated, a lot of worry would be taken away from the grower. All this statement has done is to leave them up in the air and create further uncertainty in the industry.
The dried fruit grower is not in the financial predicament he is in at present through his own fault. He has had to face adverse seasons in 1 969, 1971, 1973 and 1974-in fact 4 seasons out of the last seven. These crop losses have placed a severe financial stress on the industry which has been only partly offset by the higher prices in the last 2 seasons. The dried fruit industry was fully conscious of the effect of these adverse seasons because in the Australian Dried Fruits Control
Board’s submission to the Industries Assistance Commission, which is recorded at page 10 of its 5 1 st annual report, it referred to:
The recommendation by the Board that the Commission enquire fully into the Federal Raisin Insurance Programme for Dried Fruit Producers in California so that it may be able to recommend to the Australian Government the establishment of a rain insurance programme appropriate to the Australian Dried Vine Fruits Industry.
The Board considered that if the industry had had suitable insurance during those adverse seasons it would not be in the financial predicament that it is in today. Further, it made a recommendation that consideration be given to the establishment of a food bank throughout the world in strategic centres, together with the provision of suitable transport and distribution facilities. This is another thing that is causing a great deal of problems for the Australian dried fruit growers because they have a fluctuating production level. The situation would be improved if they could have some form of storage from which they could supply their markets. Unfortunately they often have had to cut off supply to their markets. So that they could supply the bigger markets, they have had to drop other markets. With some kind of a world food bank this problem could be overcome.
The Australian dried fruit producer is not asking for handouts at the expense of the Australian taxpayer. The producers’ representatives have often pointed out that stabilisation is not subsidisation. It should be remembered that during the first years of the stabilisation plan- 1964 to 1968- no contribution was made to the various funds by the Australian Government. The Australian dried fruit industry is the third vine producing country in the world, giving employment to thousands of Australians. During this period they have paid millions of dollars into the State and Federal Government treasuries. Also they employ 5500 dried vine fruit producers as well as some 70 000 people who depend on the industry. Under the present plan the Australian Government contributed only $ 1.48m to the fund in 1971 and 1972. As the honourable member for Angas said, it is expected that they will have to contribute more in 1976. However, I believe that the industry itself has proved that it can be viable if it gets the right assistance at the right time. I ask the Government to give further consideration to lifting the maximum price payable.
-Mr Speaker, it is a great pleasure to follow the honourable member for Darling (Mr FitzPatrick) because he is the first member on the Opposition side of the House that I have heard speak on any agriculture Bills that we have had over the last 4 weeks with any understanding of the effect of these Bills on the industry and of the importance of these Bills to rural communities. He made one very true statement when he said that when the members change sides of the House they change their argument also. I think Labor members will do well to recognise that they were in Government for the past 3 years; we have been in this Parliament as a Government for only the last 4 weeks and already we have initiated several Bills that are going to provide great benefit to rural people. Labor should remember that it removed $600m worth of former assistance to people in rural communities during its term in office. I think it is only a great show of crocodile tears for Labor members to stand in this place today and give some sort of support to the passing of these Bills.
This Bill that we are discussing extends the dried fruit stabilisation scheme to take in the 1976 crop. I think we would do well to remember that the 1976 crop is already produced. It is almost entirely on the racks and ready for packing and sale. It worries me that in discussions on these Bills there appears to be a tremendous amount of misunderstanding and a lack of recognition not only of the different problems faced by rural producers, and primary producers in particular, but also of the problems confronting any government in providing support to these industries. Surely the fact that a business is called grazing, farming or horticulture does not mean that people engaged in these businesses are different from other types of human beings in the nation. They- perhaps I should say we- are only different because they can be directly affected by a bounty or by the cruelty and savagery of nature. Some academics and particularly members of the Labor Party have influenced the thinking of a new generation of young people in this nation as to how a farmer acts or thinks. With the absence of assistance from the media providing a balanced discussion on rural matters, they have built up a complete and false picture of primary production in particular.
Two previous stabilisation schemes have been developed for the dried fruit industry. There were schemes in 1964 and 1968, and a further plan was developed in 1971 following negotiations with the industry to cover the 5 crops commencing with that harvest in 1971. The scheme then provided for the establishment of an annual base price for each drying grape, calculated each season according to movements in production costs which are assessed by the Bureau of Agricultural Economics. As has already been pointed out, limitations are placed on Australian Government contributions, the maximum payment per tonne being $23. This is reduced in proportion to the excess of production over specified levels. As pointed out the scheme is linked to the industry’s operating system of equalising returns for all participating growers and packers from the sale of a particular season’s fruit. Equalised returns are compared with assessed production costs as one step in determining whether payments into or from varietal stabilisation funds are called for. The stated object of the scheme is to maintain viable returns to producers at stable levels. However, as the honourable member for Darling has pointed out, limits built into the scheme have minimised its effects. Because the scheme operates only on prices, its effectiveness as an income stabilisation measure is limited because of the importance of variations in production as a destabilising force on growers’ incomes.
The Opposition spokesman on agriculture, the honourable member for Blaxland (Mr Keating), has pointed out the Government contributions that have occurred over the years in relation to this scheme. Net Government contributions of $400,000 and $lm were paid in respect of the first 2 crops covered by the scheme. In 1973 and 1974 the industry experienced unprecedented increases in export prices which resulted in returns exceeding support prices in those years. However growers were not required to contribute to the scheme because the minimum quantities set by the scheme were not achieved. Despite record prices for dried vine fruit, growers’ incomes have not increased in recent years. A return to low export prices in 1975 and 1976 combined with continued increases in growing, packing and marketing costs is expected to lead to a decline in incomes. The present scheme has had little effect on either the level or stability of returns to growers to date. However the prospects for improvement in world dried vine fruit prices are not good and production costs are expected to show a significant increase in 1 976.
The continuation of the scheme is likely to result in a Government contribution of $ 1.4m in respect of sultanas in 1976. This assistance for growers of sultanas could be significant as their dependence on returns for dried vine fruit will be increased because wineries have reduced their grape intake in 1976. Wineries have already run down wine stocks, and purchases of smaller quantities of grapes in 1976 have occurred. The decision to do this is another result of the Labor Government’s removal of section 31A of the Income Tax Assessment Act and it has created a tremendous problem within the wine growing industry- a problem that is unique in that it does not occur in other rural industries.
– The Labor Party just does not understand, does it?
-That is quite right. As the honourable member for Murray has said, there was a tremendous amount of misunderstanding and ignorance on the part of the previous Government as to the effects of some of the decisions taken by it over the last 3 years. The Australian Dried Fruits Association has requested that the maximum level of government contribution be increased from $23 per tonne to $33 per tonne. I think that the Association has a very good case in suggesting this $10 per tonne increase, on two grounds- firstly, because the cost of production is now largely fictional and, secondly, because the level of assistance of $23 per tonne, which was realistic in 1971 when it was granted, is unrealistic against the heavily inflated costs of the 1976 season.
The cost of production on which the stabilisation plan was based is in 2 sections- cash costs and constant costs. The cash costs are indexed forward each year according to the actual movements of the particular items and have moved from $153 per tonne in 1971 to $283 per tonne in 1975. The so-called constant costs have remained unchanged at $119. I shall give the components of the constant costs. This matter has already been referred to by the honourable member for Darling, but I would like to promote a different aspect in the discussion on it than he did. The honourable member has mentioned the owner-operator’s allowance as being assessed at $62.15 without any change, depreciation at $36 and interest on farm capital at $21. As I have already mentioned, this brings the assessment per tonne to $119. These costs have remained unchanged for the full period of this plan. In the same period, on the figures of the Bureau of Agricultural Economics, labour costs have increased by 87.6 per cent, farm plant costs have increased by 57 per cent and farm capital has increased by 83 per cent.
If those costs also had been subject to indexation the constant cost factor would have increased to $211 per tonne and would have given an overall cost of production of $494 per tonne. Acceptance of the indexation would not have increased the Government’s liability; it would have reduced the price level at which government assistance became applicable. Because these constant costs are not indexed the increase in the total cost of production- again I stress that this is totally unrealistic- has been only 47.6 per cent. In the same period the minimum adult wage index has increased by 90.8 per cent and the average male weekly earnings have increased by 73.8 per cent. These increases have further disadvantaged the dried fruit growers in relation to the rest of the community. The assistance of $23 per tonne on present pack indications could mean a payout to growers of up to $1.4m, which would be a welcome injection into the industry; but on an individual basis it would do very little to assist the cash position of growers.
This will be the eleventh year of stabilisation in the dried fruit industry. In the 10 years in which the plan has operated the industry has earned over $176m in export income. The total government assistance to date is $1.3m. Even with the estimated $1.4m assistance for the 1976 season, it seems a small price to pay for the value of these export earnings. Of course we all recognise, as the honourable member for Darling has done, that there is more to a dried fruit industry or any rural industry than just the value of export earnings. The honourable member for Fraser (Mr Fry), in an earlier speech on the States Grants (Fruit Canneries) Bill suggested diversification. The people in the River Murray area of my electorate have really tried to diversify; they have tried to help themselves. They diversified into wine growing, only to see the Labor Government promote difficulties in that area by removing a very necessary valuation system. They have diversified into market gardening. They have diversified into olives only to see the imports into this country increase to such an extent that they are threatening this industry. I think we all should take cognisance of the fact that things in rural areas are not good. Professor Henderson has indicated in his report on poverty that the amount of poverty in rural areas is far in excess of poverty in urban areas. The situation is that 14.4 per cent of all people in rural areas are regarded as being below the poverty level and there is another 10.8 per cent only within the category of 20 per cent above the poverty level.
Farm industries have provided in Australia the base for development. They have provided the base of decentralisation and complementary to this I believe all future prospects of decentralisation will either work or fail according to the strength of this base. It is going to take a great deal of understanding by a large urbanised and consumer orientated population to recognise the importance of primary industry in the future. Unless employment in primary industry is regarded as a prestigious occupation I am quite sure that not only will the incomes, the economies and the social aspects of life in rural areas be affected but there will be a very disastrous effect upon the life of this nation over the next 2 decades.
I should like to refer to reports of the Industries Assistance Commission. When the IAC legislation was introduced into the House I was one who voted against it. I did not believe that the operation of the IAC would meet the reasons for its introduction, that is, to establish what assistance and what changes could be made within the whole area of various industries and businesses in this nation. I think that my judgment at that time has been borne out in what has actually happened. I believe we have seen the Industries Assistance Commission used to delay assistance to industries. Despite the good work by all of the people on the Commission, its reports are sometimes out of date by the time they are produced and I do not believe that the Commission looks at rural industries in total terms. We must realise that industries are not just economic entities. They have social consequences and social values, and decisions taken will have long term effects on many communities that cannot be calculated just in economic terms.
We all recognise that the main problems that are confronting all industries in Australia today, as well as the dried fruit industry, are not problems that have been developed by the rural producers themselves. Almost all of their problems have been totally out of their control. In Victoria, for instance, we have had water rate increases in the last 3 years of 78 per cent- well above the rate of inflation. As the honourable member for Angas (Mr Giles) has said, we have had huge increases in premiums for workers compensation policies and the cost of labour has doubled within the last 3-year period. It surprises me that industries today are regarded as being efficient depending on whether they can cope with particular economic circumstances or particular production costs. It surprises me to find that an industry regarded as efficient in, say, 1972 is now- because the price for a product has not improved and production costs have gone upconsidered as being inefficient in a report brought down by a government or any other organisation. It is a ridiculous situation and one that I believe we should all recognise. Unfortunately many of the reports have nothing to do with the producer’s efficiency because many of the factors discussed in them and used to point out the instability or the inefficient methods of that industry are simply out of the control of the producers.
The Government accepts the interim report of the Commission that this stabilisation support should continue. I have pointed out that I believe it is deficient in many respects but it is a useful bridge to the development of different policies which should apply and be the result of Government consideration when the Commission’s final report on the dried fruit industry is brought down. The dried fruit industry is a labour intensive and export orientated one. In my electorate, particularly along the Sunraysia area of the Murray Valley this year, it has been extremely difficult to obtain labour. This has been because of several factors. One has been the introduction of the new income tax rebate system. The direct payment that it has become necessary for pickers to pay of 35c in the dollar if they are employed in a second job has greatly disadvantaged the employment of local people in the industry. I know this is outside the control of the Minister for Primary Industry (Mr Sinclair) and outside the control of the industry itself, but I believe the Government will have to look to the income tax rebate system and take cognizance of some of the anomalies that exist in it and how they are affecting the obtaining of employment in some of our rural areas.
Unfortunately for those unemployed, but fortunately for the fruit-growing areas of Australia this year, the huge unemployed workforce has benefited the industry. I must commend the officers of the Commonwealth Employment Service who have worked very diligently in getting some of our unemployed people into the workforce. In the Mildura employment region some 1400 people were unemployed at the end of January but today, thanks to the work of the Commonwealth Employment Service officers and the desire of these people to get into the workforce, this figure is now down to one hundred and seventy. There has been criticism throughout some of my areas of the fact that unemployed people have not been used to the extent that they should have been, but I believe that figures point out that, through the work of our employment service and the desire of local people to work, the unemployment rolls have been greatly reduced and this has been of great benefit to the industry during this picking season.
It is the Government’s intention that this process of adjustment should be orderly. I hope that the Industries Assistance Commission’s report is brought down soon and that the measures that are undertaken as a result of that report are not accompanied by any unnecessary individual hardship. The honourable member for Angas and the honourable member for Darling (Mr
Fitzpatrick) mentioned the fact that during this year imports of dried fruit have entered this country mainly from Turkey. I think in closing my remarks I should say that governments and people in this country who make decisions on primary industry policy matters have to make up their minds whether they wish to have primary industry in this country. If they do, I believe they will have to continue to take measures to protect those industries. When dried fruit can be imported into Australia and sold for up to $100 per tonne less than locally produced fruit, I think this is a good example of the action that must be taken. If governments do not want industry in this country, if governments do not want primary industries that have proved to be so successful as decentralisational measures, governments should say so, and honourable members should not stand in this House- particularly some members on the other side of the House- and condemn assistance measures that are promoted by the present Government.
– I have pleasure in supporting the member for Blaxland (Mr Keating) in his support of this Bill. I was pleased to hear the honourable member for Angas (Mr Giles) talking about the leadership qualities of a past leader of the dried fruits industry. Any industry, primary or secondary, is very dependent upon good leadership and good leadership, of course, involves those leaders telling the people the truth about their industry. They should tell the industry what its prospects are and make a reasonable and sound judgment. They should not lead the industry up the garden path and into having false expectations that it can continue to live on subsidies and can call on the Government for subsidies whenever it wants them. In my considerable experience with rural people, I have found them as a body to be a very independent people and, as a group of people, the last people in the world who want to depend on subsidies or handouts. They want to stand on their own feet. If a group of primary producers ask for a subsidy, or if they need it, you can be quite sure that they are in a desperate situation. I think that that is the position in this instance. To be able to anticipate all the variations in the markets, the whims and fancies of the consumer and the vagaries of the weather, a leader would need the wisdom of Solomon. It just cannot be done. But, still, I think we should expect leaders to be honest in assessing the prospects of their industry. They should tell people the truth about their prospects and not mislead them.
The honourable member for Mallee (Mr Fisher) was quite concerned about the movement of people out of the rural industries. I can well understand that, because he represents a rural electorate. He seemed to think that this would be a great calamity for this country. I cannot agree with that because this has been going on for 100 years. Australia was highly urbanised by about 1890. There is nothing new about this. It is an historical process which has always gone on in Australia and in every other Western country, and it will continue to go on. It will not be the end of the world if more people have to move out of the rural industries. The role of government is to see that people can get out of rural industries without experiencing great hardship and a great deal of trauma, and that is what we should be doing. Nevertheless, even though people are moving out of rural industries- and I have said that this is a continuing process- rural industries are still a very vital part of our export earning process. They are responsible for producing about 50 per cent of our export earnings, and in real terms the figure is growing each year. So the rural sector is not something we can disregard; it is a very important sector. But just because people are moving out of it, we should not think that this is the end of the world. The rural industries are becoming less labour intensive and more capital intensive, and I think this trend will continue.
The dried vine fruits industry is a classical example of a rural industry that is dependent on export markets. Here we have a subsidy which is based on the cost of production and, which is in no way related to the market where you are trying to sell the produce. Because of that the payment of this subsidy is not a very effective way in which to help these people. I disagree with the member for Angas who says that the payment of this subsidy has the effect of cushioning major price changes. It has a very minimum effect; it has a slight cushioning effect. From my quick arithmetic, which is based on the figures that the honourable member for Blaxland (Mr Keating) gave, the subsidy which has been paid in past years represents about one per cent to 3 per cent of the income of the industry. So the subsidy is a help, for sure, but it certainly does not cushion major changes in price. Of course, the future prospects are not terribly good. The prospects are that the gap between the market and our costs will narrow. The market will come down and the costs will go up. So the future prospect is that unless we do something about restructuring the industry, more and more pressure will be applied to increase the subsidy.
Of course, the dried vine fruits stabilisation scheme is not the answer to the problem, because the main destabilising factors in the industry are the variation in the cost of producing the product, the yield variations due to seasonal changes, and the world market prices. The subsidy has no effect at all on these 3 destabilising factors that this industry gets caught up in. It is unrelated to the cost of production, and it is of very minimal assistance to the industry. The main stable factors in the industry, of course, are the domestic market, which is increasing regularly, and the domestic prices, which have been fairly stable. I think that the honourable member for Angas talked about our importing dates from Turkey. I do not know whether dates are grown in his area, but if we want the Turks to buy our wool, wheat and things like that, it is fair enough that we should buy a few dates from them. I do not think there is anything wrong with that. The real answer, of course, is in structural change. I believe that in this situation structural change will take place in a natural sequence of events as the profit margin is squeezed out. I do not think that it will be a traumatic experience, as happened in the canning industry, because the capital investment is not as great and the time span in bringing vines into production is not as great. There is not so much capital tied up. So I think there will be a more natural movement out of the industry. It is the role of government to discourage new plantings and to try to ease people out. This was one of the reasons why we introduced the National Employment and Training scheme and one of the reasons why we are opposed to the manner in which the Government is attempting to wreck that scheme or to reduce its effectiveness. The Opposition supports stabilisation, but we do not support it as a matter of course. We think each industry should be looked at on its merits and the scheme tailored to suit that industry. We should not build up an expectation of subsidy for ever and a day.
If the market for the product is not related to the cost of production, we must look at a more permanent and long term solution. That is why we look forward to the Industries Assistance Commission report. We hope that it will point the way to a sound restructuring of the industry and enable people to get out if they can. The honourable member for Murray (Mr Lloyd) implied that I said that they could grow soya beans instead of vines. I did not imply that at all. I mentioned soya bean as an example of a product which we are still importing. I think some of our vine growers could do worse than bail out of the Murray Valley and go to the Darling Downs.
They certainly would find the weather conditions there much easier to live with than those in some areas of the Murray Valley.
We do not want to perpetuate a situation in which the primary producer is not a free trader or an independent landed proprietor, but is trapped in a situation in which he is not making any money, has a lot of capital tied up in a property, is not making a living and cannot get out. This is the situation that we must try to overcome. We certainly do not want to perpetuate a situation in which primary producers are working all sorts of hours under difficult conditions and making $2,000 a year. Part of the Australian Labor Party’s philosophy is that the resources of this country should be shared reasonably well among all the producers in the country.
Mr GILES (Angas)-Mr Deputy Speaker, I wish to make a personal explanation.
Mr DEPUTY SPEAKER (Mr Bonnett)Does the honourable member claim to have been misrepresented?
-Yes. I point out that I did not imply that the stabilisation scheme had much effect on income. I said that it cut out fluctuations. I felt that I was misrepresented by the honourable member for Fraser (Mr Fry). Secondly, sir, one can hardly refer to something as a subsidy when growers pay in periodically as well as receive a payout.
Question resolved in the affirmative.
Bill read a second time.
Message from the Governor-General recommending appropriation announced.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Staley) read a third time.
Consideration resumed from 4 March on motion by Mr Sinclair:
That the Bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Staley) read a third time.
Debate resumed from 26 February on motion by Mr Sinclair:
That the Bill be now read a second time.
- Mr Deputy Speaker, may I have the indulgence of the House to raise a point of procedure on this legislation. Before the debate is resumed on this Bill I would like to suggest that it may suit the convenience of the House to have a general debate covering this Bill, the Wheat Export Charge Amendment Bill and the Wheat Products Export Adjustment Amendment Bill as they are related measures. Separate questions will, of course, be put on each of the Bills at the conclusion of the debate. I suggest, therefore, Mr Deputy Speaker, that you permit the subject matter of the 3 Bills to be discussed in this debate.
-Is it the wish of the House to have a general debate covering the 3 measures? There being no objection, I will allow that course to be followed.
-The Opposition supports this legislation, as the legislation was first introduced by the Australian Labor Government’s Minister for Agriculture, Dr Patterson, in the last days of the former Government and lapsed at the second reading stage, when the Parliament was dissolved on 11 November 1975. The purpose of this Bill is to provide for the inclusion of the labour component of the owner-operator of a wheat farm in the index used to vary the annual movement in the home consumption price of wheat under the Wheat Industry Stabilisation Plan. The current Wheat Industry Stabilisation Plan is the sixth since the Chifley Labor Government first introduced such a plan in 1948. Under the provisions of the Wheat Industry Stabilization Act, the Minister for Primary Industry is empowered to fix a home consumption price for the first season and vary the price on 1 December each year, based on costs defined in the legislation.
This amending legislation flows from an undertaking by the Whitlam Labor Government in 1975 to review the calculation structure of the index for the home consumption price of wheat with a view to including the labour content of an owner-operator but not his managerial contribution. Prior to 1968 the grower received a guaranteed price on exports and a fixed home consumption price that was equal to the guarantee on the export price, with the proviso that movements be taken into account. The owner-operator allowance for labour was always included up to 1968. It was later removed after Treasury pressure to recognise only the outgoing cash costs for calculation, plus a fixed owner-operator labour cost. The commitment by the Labor Government to reinstate an award related owner-operator labour content to the home consumption price put paid to this previous practice. The amendment reflects the Labor Party’s understanding of the considerable personal effort, particularly in terms of manual labour, that a farmer puts towards the success of his crop, often working many more hours a day and more strenuously than any person he may employ.
The award rates issued for the calculation of the labour content are those of a station hand and a leading hand. It affects the price for the current year by, I believe, 62c a tonne. The Bureau of Agricultural Economics calculates the figure from survey information and the Wheat Index Committee adjudicates upon it. The 62c a tonne increase approved on this occasion will be effective from the day following the Royal Assent. This will move wheat from $98.70 to $99.32 a tonne. There will be no cost to revenue as a result of this legislation and only a minute effect upon the price of wheat products. So the consumer interest is not infringed upon. Under the legislation, the Minister for Primary Industry will be authorised to include this allowance for the owners of wheat farms in the home consumption price for the remaining four years of the plan. This proposal has the support of the Australian Wheatgrowers’ Federation and the State governments, which provide complementary legislation for the machinery of wheat stabilisation and marketing. The Labor Party supports the Wheat Industry Stabilisation Amendment Bill and believes it will encourage farmer-owners to keep up their important physical contribution towards the viability of their farms and the success of their crops.
The Wheat Export Charge Amendment Bill 1976 and the Wheat Products Export Adjustment Amendment Bill 1976 are complementary to the Wheat Industry Stabilisation Amendment Bill, and the Opposition supports both of them. The Wheat Export Charge Amendment Bill expands the definition of ‘wheat products’ as contained in the Wheat Industry Stabilisation Act 1974 and transfers these definitions to the
Wheat Export Charge Act. The Wheat Products Export Adjustment Amendment Bill authorises the Australian Wheat Board to collect from exporters the difference between the export price and the home consumption price of wheat when the export price exceeds the home consumption price. The 2 Bills bear upon each other and upon the Wheat Industry Stabilisation Amendment Bill.
In respect of the Wheat Export Charge Act 1974, the Wheat Board has found deficiencies in the existing legislation describing wheat products and products partially produced from wheat. Clause 3 of that Bill seeks to vary that definition by including wheat-based commodities such as new stock feed preparations now manufactured with about 20 per cent to 30 per cent of wheat. As the Australian Wheat Board is the sole seller of wheat for export the value of any wheat sold in a processed form recoups to the Wheat Board at the price such wheat content would have bought as plain wheat. The Wheat Export Charge Amendment Bill supports the argument of the Parliamentary Counsel that provision to tax exports should be in a charge Act. This Bill transfers that power to the Wheat Export Charge Act. The Opposition does not query either measure as both are of a machinery nature.
In general the Opposition supports the 3 Bills which are being debated in cognate form. Originally similar legislation introduced by the former Labor Government, as I said earlier, lapsed on the notice paper when Parliament was dissolved on 1 1 November. I commend the Bills to the House.
Mt HYDE (Moore) (9.57)-The Bills before the House propose minor amendments to the wheat stabilisation package; firstly to enforce compliance with the intention of that package and, secondly, to effect greater justice to wheat growers by providing that that portion of the cost of production that represents the grower’s own earnings escalates with rising costs. When considering these amendments we cannot ignore the scheme itself. Wheat stabilisation, which was introduced in the years immediately after the 1939-45 war, was regarded at the time by many as a basic wage for farmers. At that time memories of the great depression and disastrously low wheat prices were still vivid and greatly influenced attitudes. Basic or minimum wages keep wages up. However, a stabilisation scheme varies prices both up and down according to circumstance.
At constant 1973 prices the five wheat stabilisation schemes prior to the current scheme have cost growers in the order of $409.92m. On 19 September 1974 the honourable member for Darling Downs (Mr McVeigh) had incorporated at pages 1610 and 1611 of Hansard tables that quite clearly indicate the basis of that calculation. There is the near certainty that the current 5-year scheme will add considerably to the price that growers have paid for stabilisation. Yet there is a widespread belief that wheat farmers have done well because of stabilisation. That belief has developed into something of a statement of faith.
Wheat growers over a long period are not demonstrably wealthier or less indebted than wool growers or cattle men who have not had the benefits of stabilisation. But the industry has grown and, once established, efficient wheat farmers have done well. There is no evidence that that is because of stabilisation. It might be for reasons indifferent to stabilisation, or even in spite of stabilisation. There is no evidence that stabilisation has caused the wheat industry to make the best use of the nation’s resources. On the contrary, in the late 1940s and early 1950s when the world was short of grain and when buyers were anxious to pay for it, the growers’ price was kept down and resources were directed to other enterprises, in particular to wool.
It was no use Prime Minister Menzies urging farmers to grow more wheat when there were better profits in sheep. Conversely, at the end of the 1960s, wheat was in apparent over-supply. It was no use urging farmers at that time to produce less because it still paid better than alternatives such as coarse grain production. Production had to be arbitrarily limited by the imposition of quotas. These quotas, viewed with hindsight, need not have been as severe as they were. But it would have been a brave man in 1969 who predicted a bad season and a quick recovery to the world market. The overwhelming evidence is that the wheat industry has grown and that those in it have prospered, not because of stabilisation but because Australia produces wheat efficiently, land is cheap, holdings are large and technology is high. We can produce wheat more cheaply than our competitors and still make a profit.
Reference to the 1974 annual report of the Industries Assistance Commission indicates that its effective rate of protection has been low, and at present it is certainly negative. In many countries home market producers are highly protected. I do not believe their governments or their consumers will wish forever to deny themselves purchases from the cheaper world market. I believe, therefore, that the Australian wheat industry has a bright future so long as the present policies towards the removal of barriers to world trade continue to find favour. However, we should know that of the 23 OECD countries Australia was one of only 2 nations whose trade as a proportion of gross domestic product fell during the decade of the 1960s. Australia cannot expect to sell on world markets if we are not prepared to buy on them because our attitude invites retaliatory action, such as the Philippines recent embargo on imports from Australia, and also because a policy of import impediments maintains an exchange rate that ensures that our exports have greater difficulty competing on those world markets.
It is not my purpose, however, to question the principle of wheat stabilisation. It has evened out the more violent fluctuations and, more importantly, it has insured against disastrously low prices. It has transferred some of the risk of the market place to the public via the Government. Government is big and better able to absorb that risk than our individual farmers. What I am questioning is the myth that stabilisation is all right and all-wise and that it should be left well alone. What I am trying to do is to convince honourable members that there is indeed room for improvement. If there is room for improvement, now is the time to make it while prices are high. We should look carefully at the opportunity to improve the scheme in the national interest as well as in the growers’ interest. When the home consumption price is well above the stabilised price, growers near a State border possess a quite unfair advantage over those growers who are so far from a border that freight costs prevent them from selling all their grain at the home market price. They have a quite unfair advantage over those who believe that such behaviour is quite improper. Every tonne sold across the border is a tonne not sold at the home consumption price by the pool. Every additional dollar made from an across the border sale is a dollar not earned by those who pool their grain.
In 1968 and 1969 domestic sales by the Australian Wheat Board fell from about 1 900 000 tons to about 1 600 000 tons, only to rise again to about 2 200 000 tons when the stabilised price again rose above the home consumption price. This suggests that 300 000 to 600 000 tons will be sold outside the pool while it pays to do so. Whatever the merits of using the home market to limit the more violent movements in growers’ returns, it is not justice that some growers receive greater benefits in times of low prices while only bearing a proportionate share of the costs in time of high prices. It is not helpful to the Wheat Board or growers to have to achieve a determined degree of price stability using a home consumption price that affects only a portion of the home market. It is not fair to some producers of wheat products, eggs or bacon that other producers can buy their grain for less than they can. It is not economic sense that this advantage is arbitrarily determined by proximity to a State boundary. It is not certain that the Commonwealth powers can be used to prevent these problems, but it appears unlikely. It is not certain whether the individual States can or will pass legislation that brings all wheat into their ownership as it leaves the farm gate and thus prevent across the border sales. Now is the time when vested interests in across the border selling are low. Now is the time to endeavour to avoid this problem for the future.
The 1969-71 wheat slump demonstrated the impossibility of setting a price too far from the world market without the necessity of imposing quantitative restrictions on production. If growers are to be paid a price at which they expect to make a profit from a particular paddock, and it is a better profit than they expect to make from alternative use of that paddock including reserving its fertility for another year, there is every chance that they will crop that paddock irrespective of world markets or national stocks. If price is not to be a disincentive to overproduction then another disincentive is necessary.
Quotas are one such disincentive. Nonnegotiable quotas strike at growers without reference to the individual grower’s ability to direct his resources to other activities. For example, a dry outer wheat belt farm that grows wheat efficiently but where stocking rates are low and rainfall too light for acceptable coarse grain yields receives the same proportionate cut in production as a property that might draw income from a stud and an excellent coarse grain enterprise. The operator of the latter business would need to be offered only a very small price to be induced to sell the quota. The operator of the former business could afford to pay a tidy price for wheat quota before opting for, say, barley production. No sale of quota would take place unless both farmers were advantaged by the deal.
Quotas are inefficient in that they direct resources to other than the most profitable employment. I know a farmer who did not use his wheat quota because his property had reached the stage of development where it was more profitable to do other things with it. This man was and still is desperately short of cash. Other farms were geared up with plant and labour to grow wheat and to do little else but were denied the right to sell their produce at any price. Quotas are inefficient but much less so if negotiable. Quotas give rise to acrimony. I still think that Western Australia fared badly under the 1969 to 1973 quotas. Quotas limiting the right to sell at any price are not the only means of limiting production. Price can be used without abandoning the insurance of stabilisation. It would be possible to issue quotas, preferably negotiable, conferring the right to sell just so much wheat at the stabilised price while permitting further production and sales on a going world market- in other words, a 2-price scheme. Such a system would have appeal to efficient producers and to those who believed that quantitative restriction of the production of food in an underfed world is immoral.
The 1969-72 wheat slump emphasised other restraints to Australian wheat production that are perhaps unnecessary. These arise from the fair average quality system and from the registration of varieties. I have no doubt that the great uniformity has some advantages. Australian standard white is well known and buyers know that it is what it is stated to be. There certainly are some cost savings associated with the sale of a big uniform product.
Price and market opportunities lost, though substantial, are more difficult to identify. The grain market is probably a continuous range of requirements which we are trying to satisfy with a product identified by broad discreet classification. Wheat varieties are registered to ensure that they fall within that broad classification. We do not know what opportunities have been lost because of the inability to satisfy more exactly the requirements of the purchasers of Australian standard white wheat, but the fact that buyers sometimes endeavour to stipulate the port of shipment for reasons other than freight costs leads me to suspect that these opportunities merit further consideration. We do not know what opportunity exists for the production in Australia of varieties that fall outside the Australian standard white classification, and those classifications that are necessarily associated with it, such as the under-grade classifications.
I suspect that some farmers could produce the low price high yielding varieties such as the dwarf varieties more profitably than the varieties which they are at present permitted to produce. These people would sell to different markets and in times of over-production they would not crowd the bread wheat market. Most importantly, some growers would be in a position to change from one market to another according to demand.
If in 1969-70 some growers had found a profit from the production of stockfeed wheat varieties or from a specialist variety, other growers would have welcomed the extra quota available to producers of Australian standard white. Such opportunities can best be discovered and the necessary knowledge accumulated by permitting individual growers to pursue the opportunities as they see them. Of course there are very real administrative difficulties. Perhaps they really are prohibitive but it is time the industry asked itself whether it is paying too high a price for market simplicity.
We know that in general buyers pay more for clean whole grain of high protein and high baking strength and yet the payment to growers of f.a.q. wheat begets f.a.q. deliveries. There are no market rewards that encourage the farmer to produce better than fair average quality except the fortunate general correlation between high fertility, high yield and high quality. There is no price disincentive against choosing to grow a wheat of low protein level from poor soil and high rainfall. It pays to deliver every wild oat seed possible up to the number allowed before dockage. A tonne of a soft variety such as insignia pays a grower as much as a tonne of gabo. Is it not possible to pay growers a price that would more closely reflect market preference? This price might be determined at the Wheat Board’s leisure from samples from the individual grower’s deliveries taken at the time of delivery.
Finally, I question whether it is necessary to place in some of the complementary State wheat stabilisation acts and variety registration acts powers of search and entry we do not allow our police. Sometimes laws to control industry trespass on personal liberty to a degree not permitted under the criminal code where the purpose is to protect life and property. Few people realise that officers administering these Acts may enter and search homes without the warrant required by policemen. When we tamper with a market system in order to mitigate its harshness we certainly open up a can of worms. It is not impossible to sort out a can of worms but it is certainly very difficult; it certainly requires time and patience. There are not likely to be any panaceas and I do not suggest any. My purpose is to encourage a questioning of some of those things I believe ought to be questioned, not least by the members of the industry themselves, at a time when the industry is strong enough to place its house in order. Mr Deputy Speaker, I commend the Bills to the House.
Mr FitzPATRICK (Darling) (10.13)-Mr Deputy Speaker, I support the Wheat Industry Stabilisation Amendment Bill 1976, the Wheat Export Charge Amendment Bill 1976 and the Wheat Products Export Adjustment Amendment Bill 1976. Because I am told that the Minister wants to get these Bills through the House tonight it is not my intention to deal with them at length. However, I do want to touch on one of the matters mentioned by the honourable member for Moore (Mr Hyde). He said that there is always room for improvement in a stabilisation Bill. I agree with the honourable member. That is one of the reasons why I wish to support the legislation before the House tonight. I believe that the proposed amendment of the Wheat Industry Stabilisation Act will result in a better stabilisation scheme.
The inclusion of the labour component of the owner-operator of a wheat farm in the index used to vary the annual movement in the home consumption price of wheat will do much to improve the scheme. We should at all times endeavour to improve our stabilisation schemes, as the honourable member for Moore has pointed out, because they remove the uncertainty in the minds of the growers and allow them to plan their production over a longer period. This often results in greater financial investment and, with better planning, brings back a greater financial return to the grower.
This House has already been informed that the Bill has the endorsement and ready acceptance of the industry. One would expect this to be so because its basic aim is to bring to the industry security or protection against price fluctuation. The value of a stabilisation scheme is the fact that it sets out to protect against price fluctuation without undue interference with the market price, although I must admit that on occasions this would be justified as it is in the wool industry already mentioned by the honourable member for Moore. These were the things that the Labor Government had in mind when an amendment to the Act was first proposed by the then Minister for Agriculture, Dr Patterson.
The inclusion of the labour component in the index in the owner operation of the wheat farm is a justified measure, and I believe one that is long overdue. As a matter of fact I cannot help recalling that in the Bill that has just been passed by the House we did not see this movement in the wage component. I do not think there is any justification for leaving out the labour component. Everyone must realise that it is a very significant part of wheat farming. Should something happen to the health of the wheat farmer or the wheat owner-operator and his ability to do the work himself, this provision could mean the success or failure of a wheat farm. So it is only natural that the labour component should be taken into consideration. It is of some satisfaction to me to know the history of this stabilisation scheme since it was introduced by the Chifley Government in 1948, to know that the labour component was included from 1948 to 1968 and to know that it was the Whitlam Government that first set out to reintroduce the labour component.
The measure will help in the stabilisation of the price related to movement in the international wheat price. I support the amendment because no government should support a scheme which is not related to the requirements of either the international market or the home consumption market. If this were not so our valuable resources could be wasted or an excess production of wheat take place. We should be concerned not only with the fluctuation of the price of the wheat in the world market but also we should be conscious of the world consumers. A greater effort should be made to set up a world food bank. I have already mentioned this aspect tonight. The same argument applies to the wheat industry as it does to the dried fruit industry. I believe that Australia should give a lead in this direction. Not only would such a world food bank save many human lives but it would also provide a steadier income to the producer. I do not want to take up the Minister’s time. It is very pleasing to support the Bills which I hope the Minister will be able to have passed by this House this evening.
– People who are not closely associated with the wheat industry tend to look upon ‘stabilisation’ as a word which only indicates Government support for an industry. This is simply not true. But one can excuse the honourable member for Robertson (Mr Cohen) thinking as he does because we all realise that he would not know anything about farming. He has been taught in the school of people Uke Professor Donath from the Melbourne University and Mr Tom Connors. They have always peddled that type of propaganda- propaganda aimed at alienating rural and country people. Happily these lounge chair commentators no longer have much relevance in the community because they were destroyers rather than builders, theoreticians rather than achievers, talkers rather than doers. Hence I want to use some time in this debate to undo the great wrong people like the honourable member for Robertson have done and to set the record straight.
Stabilisation is a whole package. It means cooperation between the farmers and the Government; the Government helping when overseas prices are low, the farmers insuring for the rainy days when overseas prices are high. It means orderly marketing with complementary StateCommonwealth legislation. It means a guaranteed home consumption price for wheat consumed in Australia, a price which is set for the wheat year 1 December to 30 November based on an index system which varies the price according to increases or decreases in prices, wages and rates of charges as specified in the Wheat Industry Stabilization Act 1974.
This index of cash costs, rail freight and handling charges was based on results of surveys covering the years 1969-70 to 1972-73. The price structure of this index of farm costs was based on the Bureau of Agricultural Economics survey of the wheat industry, and for rail freight and handling costs on a survey of the accounts of the Australian Wheat Board and the various grain handling authorities and co-operatives in the mainland States, both surveys covering the years 1969-70 to 1972-73. Historically this has been the general principle covering the gazettal of the home consumption price. There have been changes in procedures for the 6 stabilisation schemes we have had. The Labor Party, no doubt true to its diabolical opposition to rural industry, saw fit not to include the usual owneroperator’s allowance as an item in the calculation of movements in the home consumption price of wheat for the sixth scheme but undertook to consider the matter later. It is true that it did relent and the previous Minister for Agriculture introduced legislation on the 5 November last year which was substantially the same as the legislation we are now discussing but it was done only after pressure had been exerted by the Australian Agricultural Council, as is stated in Resolution No. 938 which states: . . . . agreed that the inclusion of a labour allowance would appear justified in principle and the Council recommended that in the arrangements for adjusting annually the home consumption price of wheat, account should be taken of movements in costs of the operator’s labour, on the hopes of an appropriate allowance.
The legislation introduced by the Minister for Primary Industry (Mr Sinclair) takes note of this recommendation and now that it is included it will be one of the items to be costed annually over the remainder of this current sixth plan.
Already one-quarter of the year is gone and it is to be regretted that the producers of wheat have had to subsidise the consumers by approximately $372,000 based on a quarter of the total consumption of 2.4 million tonnes per year as well as the $50m they are estimated to subsidise the consumers because the export price over the year is estimated to be $20 per ton higher than the home consumption price.
In these days when the irresponsible element of Parliament which sits opposite us is always mischievously trying to ignite the powder keg of trade union leaders’ applications for more and more wages, it would surely be a good thing if these people paused a while, gathered their scattered brains together- the few they have got must be lonely- and used some of their efforts in asking their followers to copy the example of the wheat growers in restraint, responsibility and statesmanship. They would then earn some respectability and forgiveness. The labour allowance for the owner-operators of wheat farm enterprises therefore should have applied from 1 December last year but will now apply as from the day after the Bill receives royal assent. The figure will be based on the award as at 1 October 1976. It will make no allowance for the 6.4 per cent increase in wages for everyone else, an increase the farm workers will get but not the farm owner. I appreciate the Minister’s explanation of this but I want to put on the record that the owner-operator’s allowance will be constant until 30 November next at the rates applicable at 1 October 1975. Time does not permit me to record the way this allowance has been arrived at. It is an interesting method which does not make sufficient allowance for the fact that the farmer is also an economist, a scientist, a businessman and a philosopher.
The speech of the shadow Minister, the honourable member for Blaxland (Mr Keating) was strong and lengthy in words but weak in knowledge and fact, so it is appropriate to compare the small increase in wages for farmers with that accorded to other workers. The labour allowance in the Bill is based on a combination of the margin enjoyed by a leading hand under the Federal Fruitgrowers’ Award and the head stockman’s margin under the General Station Hands’ Award for the south eastern division of Queensland. The increase is rather small. A classifier employed by the State Wheat Board in Queensland had a 46.12 per cent increase in wages in the period 11 March 1974 to 16 February 1976. An assistant silo operator had a 56.26 per cent increase over the same period. No wonder there has been an overall increase of 121/2 per cent in costs of handling the Australian wheat crop, from $4.16 per ton for an 1 1.2m ton crop in 1973-74 to $4.67 per ton from a 10.7m ton crop in 1974-75. Only this week farmers have been advised that prices of harvesting machinery have increased 20 per cent, and one particular brand in regular use in Queensland now costs in excess of $57,000.
Costs are the cornerstone of this industry. Railway freight has increased out of all proportion. The average freight for the Australian average call at 1 January 1974 was $7.27 per ton, at 1 January 1975, $8.23, at 1 January this year $9.80 per ton. In some States freights have gone through the ceiling. We find freight from sending station to port takes a huge slice out of a first advance. In Queensland it has cost growers an extra $3.5m in railway freight, a sum they can ill afford to pay particularly when nebulous formulas such as capacity to pay are the criteria used to charge rail freights. No allowance seems to be made for the quick turn-round and year-round traffic of the grain industry. One must also rebut the charges that have been made in the media re the increased price of bread caused by the increase in the price of wheat as announced in this legislation. That is totally incorrect. On the basis of 1100 21b loaves of bread to a ton of wheat the increase of 62c per ton adds only approximately 0.06c to the cost of a 21b loaf. Yet we note, in the paper today that the price in Melbourne has increased by 2c a loaf.
I do appreciate the fact that the Minister requires this Bill before 10.30 so I want to conclude on this note by asking the question: Where does the industry go from here? I believe it is time for a re-examination of traditional roles. With the increasing tendency of government to control our lives I should think it is time for the industry to analyse and examine itself. In a highly volatile market where the supply-demand syndrome is now more important than the production and government policies of the United States of America, in a climate where there is likely to be the maximum of $80m in the stabilisation fund at the end of the scheme, one can readily visualise farm leaders questioning whether they want more control by having to submit to the Industries Assistance Commission even if there is only the slightest hint of government assistance or whether they should forget about assistance and use this $80m as the basis for their own stabilisation fund. We are delighted that the Minister has seen fit to introduce this legislation, legislation which should never have been necessary if those who sit opposite, where they are going to sit permanently, had had some feeling for the rural industry.
Question resolved in the affirmative.
Bill read a second time.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Sinclair) read a third time.
Consideration resumed from 26 February on motion by Mr Sinclair:
That the Bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Sinclair) read a third time.
Consideration resumed from 26 February on motion by Mr Sinclair:
That the Bill be now read a second time.
Question resolved in the affirmative.
Bill read a second time.
Leave granted for third reading to be moved forthwith.
Bill (on motion by Mr Sinclair) read a third time.
Mr DEPUTY SPEAKER (Mr Lucock)Order! It being 10.30 p.m., in accordance with the order of the House of 18 February 1976 I propose the question:
That the House do now adjourn.
Question resolved in the affirmative.
House adjourned at 10.30 p.m.
The following answers to questions upon notice were circulated:
asked the Minister representing the Minister for Education, upon notice:
– The Minister for Education has provided the following answer to the honourable member’s question:
Year ended 30 June.
Following the former Government’s decision that the calendar year 1976 should be treated as a year outside the triennial progression, the Universities Commission made recommendations for the calendar year 1976 which were tabled in the House of Representatives on 14 October, 1975. These recommendations have been accepted by the Government. They include provision for the program of expansion of existing facilities and development of new schools outlined above. This will allow the University of Newcastle to accept its first medical students in 1978. In the case of the James Cook University of North Queensland, an amount of $40,000 is available in 1976 to permit the appointment of a Dean to assist in the planning of the Medical School. This appointment will be temporary until such time as there is a decision on the provision of appropriate clinical facilities in Townsville.
asked the Minister representing the Minister for Education, upon notice:
– The Minister for Education has provided the following answer to the honourable member’s question:
Year ended 30 June.
In its Sixth Report, for the triennium 1976-78, the Universities Commission recommended provision of earmarked grants to allow an expansion of enrolments in dental schools at the Universities of Melbourne, Queensland and Western Australia. The implementation of these proposals, together with a proposal expected from the University of Sydney, would have increased the output of graduates to about 370 per annum by 198 1 and would have met the dentist to population ratio proposed by the Department of Health by the mid-1990 ‘s.
asked the Prime Minister, upon notice:
As the China Antiquities Exhibition has now been to Great Britain and the United States, is he able to say when Australia can expect to see it.
– The answer to the honourable member’s question is as follows:
Planning is well advanced on a Chinese antiquities exhibition which is expected to come to Australia early in 1 977.
asked the Minister representing the Minister representing the Minister for Science, upon notice:
– The answer to the honourable member’s question is as follows:
Cite as: Australia, House of Representatives, Debates, 18 March 1976, viewed 22 October 2017, <http://historichansard.net/hofreps/1976/19760318_reps_30_hor98/>.