25th Parliament · 1st Session
The PRESIDENT (Senator the Hon. Sir Alister McMullin) took the chair at 3 p.m., and read prayers.
– I desire to ask the Minister representing the Minister for Labour and National Service a question. Are different standards of education and physical fitness required of volunteers for the Regular Army than are required of national service trainees? Is there a difference between the tests to establish educational standards or a difference between the medical examinations to establish the physical fitness of a volunteer for the Regular Army and a national service trainee respectively?
– Part of this question would come under the responsibility of the Minister for Labour and National Service and part under the responsibility of the Minister for the Army, but 1 think I might guess what is in the honorable senator’s mind and give an answer along these lines: People who are to undergo national service training are often medically examined by panels of doctors who are appointed by the Department of Labour and National Service in various parts of the country. Subsequently there is an examination by the Army doctors themselves. To the best of my knowledge, there is no difference in the standards, but there may bc some difference of approach between panels of doctors who are not Army doctors in one section and panels of doctors in another section, and the Army doctors. To the best of my knowledge, the standards which are sought to be applied are the same standards.
– What about the educational standards?
– I do not know about the educational standards. I ask the honorable senator to put that part of the question on the notice paper.
– I ask a question of the Minister representing the Minister for External Affairs. Are Press reports true of an impending crisis in Vietnam due to an alleged statement by Premier Ky that he will retain office for 12 months after the election? Did he actually say this, or has he been malevolently misrepresented?
– I do not feel in a position to comment on that question at the present moment. I think that all I can say is that the Australian Government has, of course, an interest in the stability of any government in South Vietnam and would wish it to be as broadly based and as representative as is possible in the circumstances. Other than that general expression of interest, at the moment I would not feel competent to comment on the specific matters raised by the honorable senator.
– I address a question to the Minister representing the Minister for Civil Aviation. 1 ask: Is it true that an interim settlement has been reached between the Australian Federation of Air Pilots and Qantas? Under this interim settlement, has machinery been set up for discussion and the finding of a solution to the many outstanding problems affecting pilots and air crews? Can the Minister advise when these matters will be finalised? Will he direct the urgent hearing and completion of all discussions as promised by him in connection with a question I asked concerning this matter last week?
– Last week, the honorable senator asked me a question on this matter. I promised to convey his question to the Minister for Civil Aviation. This has been done. As to the question of the interim settlement or the other negotiations that may have taken place, I have not been informed of the position. I will seek the information now as a matter of urgency and if 1 am in a position on the next day of sitting to give a reply, I will furnish it to the honorable senator.
– Six months ago - last November to be correct - I directed a question to the Minister representing the Minister for the Interior complaining that the part time female cleaners employed by the Commonwealth Government were denied the furlough benefits provided under the Commonwealth Employees’ Furlough Act because they worked 23 J hours a week. If they worked an additional 15 minutes a week, they would be eligible to receive these benefits. There is a very simple solution to this grave disability. The Minister promised to refer my inquiry to the Minister for the Interior, but so far everything is quiet on the furlough front. I ask the Minister now: Will he favour me with any information he has received on this matter?
– In accordance with the promise I made to the honorable senator, f did refer his question to the Minister for the Interior. I will remind the Minister for the Interior again that he has not provided an answer so far.
– I direct a question to the Minister representing the Postmaster-General. In view of the precedent established by the Commonwealth Government in financing the construction of access roads to television transmitters, notably the Bajool-Mount Hopeful road at Rockhampton, will the Postmaster-General give early consideration to the submission of the New South Wales branch of the Postal Telecommunication Technicians Association which seeks the extension of similar facilities to the Barraba-Mount Kapitar road which links Dorrigo with the Mount Mombill television transmitter, and which would provide a safe and direct mode of travel for the operating staff of this television transmitter?
– I will convey the request to the Postmaster-General.
– My question is directed to the Minister in Charge of Commonwealth Activities in Education and Research. Has the Minister seen a report by the Australian College of Education showing widespread and glaring inadequacies in the qualifications of Australian teachers? Does not the desperate situation in Australian schools revealed by the report suggest the need to tackle the problem of teacher training on a national basis? In view of the escalating anxiety about this critical aspect of the education problem, will the Minister undertake to re-examine the recommendations of the Martin Committee relating to teacher training, which the Government so shortsightedly and complacently rejected last year?
– The answer to the first part of the honorable senator’s question is: “ No “. But I have seen newspaper condensations of the report to which he refers. Perhaps they are all that he himself has seen. I would not feel that such were sufficient on which to base any conclusions. The newspaper condensations to which the honorable senator refers indicate - if they are correct condensations - that there are a certain percentage of teachers who have not university qualifications and advert to the number of teachers without matriculation or further qualifications. One newspaper, the “ Age “, indicated in its leading article that it did appear that the problem of the number of teachers required is being satisfactorily tackled and that it remained now to tackle the matter of the qualifications of those teachers. Standards of entry to, and the length of courses undertaken at, teacher training colleges vary from State to State and are under the complete control of State Ministers. I should imagine that they would be the ones to comment upon the report referred to by the honorable senator.
(Question No. 840.)
asked the Minister representing the Prime Minister, upon notice -
– The Prime Minister has provided me with the following answer to the honorable senator’s question -
The income received from all sources for the tour was $207,476, so that the net cost of the operation was $64,794, without production costs, or $157,887 with production costs.
In assessing the financial outcome as well as the long term benefits to the Company, the following additional factors must be taken into consideration - (a)The cost of maintaining the Company in Australia for the period of the tour, i.e. 6th August 1965 to 20th January 1966 - a total of 24 weeks. Salaries alone for that period would have cost $91,200 although income derived from box office receipts would have partially offset this cost, and the production costs of any performances given in Australia.
The value of the overseas tour in terms of the Company’s image in Australia and the likely strengthening of audience attendances as a result of this, as well as the establishment of the Company in international circles. Proof of the value of this is that a number of distinguished overseas choreographers have expressed a wish to work with the Company.
(Question No. 866.)
asked the Minister representing the Minister for Shipping and Transport, upon notice -
– The Minister for Shipping and Transport has supplied the following answer -
(Question No. 882.)
asked the Minister representing the Minister for Primary Industry, upon notice -
– The Minister for Primary Industry has supplied the following answers to the honorable senator’s questions -
I might add, Mr. President, that on 26th April Senator Mulvihill asked whether a total ban had been placed on the export of kangaroo meat. I am able to inform him now that the Government decided recently that action will not be taken to place a complete prohibition on the export of kangaroo meat. This decision was made only after the more important aspects of the subject had been very carefully considered.
– I move -
That Notice of Motion No. 1 be postponed until Tuesday 17th May 1966.
I ask for leave to make a short statement.
– There being no objection, leave is granted.
– The reason for postponing discussion of this motion, which is to disallow the Air Navigation (Building Control) Regulations as contained in Statutory Rules 1966, No. 6, is to give the Minister, who had discussions with the Regulations and Ordinances Committee on the matter, an opportunity to further examine them, with the possibility of acceding to the Committee’s wish to amend the regulations.
Question resolved in the affirmative.
Motion (by Senator Henry) agreed to -
Assent to the following Bills reported -
Aliens Bill 1966.
Migration Bill 1966.
Nationality and Citizenship Bill 1966.
Bill received from the House of Representatives.
Standing Orders suspended.
Bill (on motion by Senator Henty) read a first time.
– I move -
That the Bill be now read a second time.
When the then Treasurer introduced the Budget for 1965-66, he estimated that the excess of expenditures over revenues would amount to about $ 1 1 1 million and that net loan proceeds would be more than adequate to cover this amount. It now seems unlikely that this will be the case. Accordingly, the main purpose of this Bill is to obtain authority for such borrowings as might be necessary to meet the resultant deficiency.
Since the Budget was Introduced, the Government has entered into a number of additional expenditure commitments. For instance, we have undertaken to provide assistance, estimated at $26 million, to the States for drought measures, we are providing $19.8 million to meet International Monetary Fund drawings in Australian currency by India and New Zealand, we have undertaken to provide emergency food aid to India estimated to cost $8 million, and we have agreed to an increase of $15 million in advances to the States for housing this year. In addition, the1½ per cent, increase in wages and salaries granted by the Commonwealth Conciliation and Arbitration Commission has been extended to the Commonwealth Public Service and members of the defence forces and wage and salary payments by the Post Office have been affected by other determinations. In short, Commonwealth expenditure is now expected to be substantially greater than was estimated in the Budget.
On the other hand, Commonwealth revenues will probably be less than we had anticipated. As a result, the excess of expenditures over receipts to be met by borrowings seems likely to be significantly greater than the Budget estimate. Despite the fact that net loan proceeds will probably exceed the Budget estimate, current indications are that we will have a cash deficiency this year. However, particularly with the May cash and conversion loan still to be floated and a considerable proportion of total income tax collections still to come in, it is not yet possible to estimate with precision the final Budget outcome for the year. In this Bill, we are therefore seeking authority to borrow an amount which is designed to cover the largest deficit which might occur. We anticipate that the actual deficit will be less - and perhaps a great deal less - than the figure of $150 million which, at this stage, we consider it prudent to seek authority to borrow.
We propose that an amount of up to $150 million should be borrowed for defence purposes and the proceeds applied to finance expenditure from the Loan Fund on defence services. The amount of expenditure on defence services charged to the Consolidated Revenue Fund will, of course, be reduced correspondingly. Provision for charging part of our defence expenditure to the Loan Fund has ‘been made in previous years when net loan proceeds have not been adequate to finance the excess of expenditures over receipts. I commend the Bill to honorable senators.
Debate (on motion by Senator McKenna) adjourned.
Bill received from the House of Representatives.
Standing orders suspended.
Bill (on motion by Senator Dame Annabelle Rankin) read a first time.
[3.30] -I move -
That the Bill be now read a second time.
The Therapeutic Goods Bill, which I present to the Senate, is designed to ensure safety in the usage of drugs and medicines and therefore can be regarded as a Bill of considerable importance to the Australian people. Although not new in Commonwealth legislation - we have had a Therapeutic Substances Act for a number of years - this present Bill introduces advances in Commonwealth legislative provisions for drug control. When enacted, it will assist in ensuring that drugs and medicines and medical equipment consumed and used in Australia meet minimum standards of safety and quality. It will supersede the Therapeutic Substances Act which will be repealed. The Bill does not represent a change in principle or policy by the Government. The policy enshrined in the Bill is similar to that in the present Therapeutic Substances Act and is in line with world-wide government policies which endeavour to ensure that drugs are safe, pure and potent. In this century we have seen the number of agents available for therapy multiply from a dozen or so to tens of thousands. In fact there are now 20,000 to 30,000 therapeutic agents available in Australia.
The introduction of so many new drugs has been accompanied by a demand for both higher quality and greater reliability and, throughout the world, governments have found it proper to establish legal standards which are minimum requirements for drugs and biological products, such as vaccines and antisera. This is part of an international system aimed at providing a desirable uniformity in standards and a ready interchangeability for these products in therapy and in commerce. The rapid introduction of many agents of diverse characteristics, such as antibiotics, and the advances of science and technology, have made the question of their standards a scientifically sophisticated field requiring much work and careful evaluation.
The need for the Commonwealth to legislate in this field is, I believe, unquestioned. The importation of drugs is an area where the Commonwealth’s authority is paramount and must be applied as a control against the dumping of inferior or dangerous drugs. Moreover, the Commonwealth itself undertakes a heavy financial commitment in the provision of pharmaceutical benefits under the National Health Scheme and it has a clear responsibility to the community to ensure that it gets value for the money spent. Constitutionally, the Commonwealth’s powers over therapeutic substances and articles are limited. This Parliament can enact legislation in relation to drugs, medicines and articles of medical equipment that are imported, exported, made the subject of interstate trade, supplied to the Commonwealth or supplied as pharmaceutical benefits. Legislation concerned with the local manufacture, intrastate supply and consumption of these items is the responsibility of State Governments.
Similarly, the Commonwealth will not enter into the general control of family remedies, including the bulk of proprietary lines. These will remain a State interest. The Commonwealth will intervene only if a substance becomes a pharmaceutical benefit or if there arises a necessity to provide standards for any particular item or type of substance which is imported or which is sold interstate to prevent it having a deleterious effect on the public in general. For example, one type of preparation in this field for which standards may be laid down is proprietary eye drops, to ensure they are sterile. I emphasise however, that, within its limited powers. this Government is conscious of the necessity of providing the legislation and the machinery for ensuring that the safeguards to protect the community are adequate.
Therapeutic agents of almost every type are tested for compliance with standards by the Department of Health at its National Biological Standards Laboratory in Canberra. Considerable progress has been made by the Laboratory, which is staffed by scientists with a wide experience in this very diverse field. In addition to this testing programme, expert committees comprising leading figures in a number of branches of medicine and science have been working for some time on the provision of advice on the complex questions concerning the safety and standards for therapeutic goods. These committees include the Australian Drug Evaluation Committee, the Biological Products Standards Committee and the Therapeutic Substances Standards Committee.
Under this Bill, the basic standards for many drugs and medicines will continue to be the monographs in the British Pharmacopoeia and British Pharmaceutical Codex. In addition, it is proposed in the Bill that the Minister for Health will be empowered to determine, by the issue of formal orders, first, specific standards for individual products - at present this can be done by Regulations under the Act; secondly, general standards for all therapeutic goods or for certain classes of goods, for example, tablets, capsules, and injections; thirdly, methods of testing for compliance with standards; and, fourthly, requirements wilh respect to labelling, packaging and containers.
Under the provisions of the Bill, goods which are imported, pharmaceutical benefits, supplied to the Commonwealth or the subject of interstate trade, that is, goods which come within the main heads of Commonwealth constitutional power in this regard, will be required to, first, conform to the specific standards as determined by the Minister or as appearing in the British Pharmacopoeia, the British Pharmaceutical Codex or the British Veterinary Codex; secondly, conform to the general standards as determined by the Minister; and, thirdly, comply with any packaging or labelling requirements determined by the Minister.
The provision for the fixing of packaging and labelling requirements will also be similar in principle to that existing in the present Therapeutic Substances Act. However, whereas the present provision only enables these requirements to be fixed for therapeutic substances for which standards exist, the new provision will be widened to embrace all therapeutic substances and articles subject to Commonwealth control.
The scope of this legislation, and its name, will be altered to cater for the advance of science and technology. I referred earlier to the fact that under the Bill items of medical equipment as well as containers in which drugs and medicines are packed will be required to meet minimum requirements of purity, sterility, etc. There has been a very considerable increase in the utilisation of plastics by the pharmaceutical industry, not only as containers, but also as an integral part of the therapeutic agent. For example, an intravenous infusion used in the treatment of shocked or dehydrated patients may consist of a volume of saline fluid in a plastic bottle with tubing and needle permanently attached to deliver the fluid to the patient’s veins. Every component of this product must meet stringent requirements. Safety could not be ensured by fixing a standard for the contents alone. The container and tubing must be leakproof and be capable of being sterilised properly, and must not interact harmfully wilh its contents. The existing Act, passed at a time before products had become so refined, does not enable control of these important matters. It is obvious that there is little point in ensuring the purity of drugs and medicines if there is no corresponding control over their containers or the articles used in their administration.
Problems have also arisen from the fact that the definition of therapeutic substances in the present Act extends to veterinary products, but the Act does not provide a reference for the standards for such products. This will be remedied by specifying the British Veterinary Codex as the normal standard for veterinary substances in the same way as the British Pharmacopoeia and British Pharmaceutical Codex are recognised as providing the standards of substances for human use. A review has also been made of the machinery by which the standards for drugs, medicines, medical equipment, containers, and so on are written into the legislation and subsequently made available to the drug industry, users, etc.
It is emphasised at this point that the standards and requirements that will be fixed under the provisions of this Bill will be arrived at by a number of careful steps which have been developed in the administration of the present Therapeutic Substances Act. Firstly, research and reference to all recognised official and scientific publications will be made by departmental officers. Next, representatives of the pharmaceutical industry, particularly those concerned with the relevant class of products, will be consulted. A written standard will then be drawn up and circulated for comment to the pharmaceutical industry. Having given consideration to any comment by the industry, the proposed standard will then be referred to one or more advisory committees comprising independent medical and scientific experts that I referred to earlier which will adjudicate on any differences raised and advise the Minister of their views.
It is also proposed that all Australian standards will be written with recognised international standards in mind. Uniformity of standards for all countries is, of course, desirable to facilitate international trade as well as to assist Australian industry. In view of the fact that the number of standards to be prescribed will reach considerable proportions and will be of a highly technical nature, it is proposed to provide that the Minister will make ministerial determinations fixing standards, rather than continue the present practice of fixing standards by regulation. The reason for this change is a recognition of the fact that the processing of a large volume of higly technical material by regulation - which is the position under the present Therapeutic Substances Act - is considered unsuitable and has proved impracticable.
The Bill provides for determinations of standards by the Minister to be notified in the Commonwealth “Gazette” and, of course, copies will be available to all interested parties immediately. Such determinations would be made effective from an appropriate date fixed after consultation with the industry. As a further aid to the pharmaceutical industry, consideration is being given to the publication of a loose leaf book which will contain a compilation of all ministerial determinations arranged in a convenient manner for reference.
The last provision of the Bill to which I desire to make particular reference concerns the seeking of power for the Minister to prohibit the importation into Australia of dangerous substances, that is, substances which may cause disease or endanger life. A good example of such a substance is the drug thalidomide, the side effects of which when taken by expectant mothers caused such tragic deformities to unborn children.
The present Therapeutic Substances Act gives the Minister power to invoke quarantine measures in respect of such dangerous substances. The restriction on importation of such substances in the past has been achieved under customs legislation, with, of course, the co-operation of the Minister for Customs and Excise. Inclusion of this additional power in the Therapeutic Goods Bill brings together the two provisions that are necessary to give emergency controls over dangerous substances when such are necessary.
In concluding, I should like to inform honorable senators that the proposals incorporated in this Bill have been discussed with organisations representing the pharmaceutical industry - both manufacturing and distributing - and the reasons for the proposals have been explained in detail. The drug industry fully recognises the importance to Australia of adequate controls in this field. The pharmaceutical industry will continue to have a voice in the administration of this Act by being represented on a special committee set up to advise the Minister on the administrative policies as they are developed. The effect of the new legislation, therefore, is that it will streamline Commonwealth control over the standards of drugs and associated medical equipment. It will enable the powers of the Commonwealth to set standards for therapeutic substances to be applied more effectively and will extend the powers to cover medical equipment used to administer therapeutic agents. I commend the Bill to honorable senators.
Debate (on motion by Senator Dittmer) adjourned.
Debate resumed from 5th May (vide page 805), on motion by Senator Anderson -
That the Bill be now read a second time.
.- The Customs Tariff Bill (No. 2) 1966, which the Senate is now debating, is complementary to the Customs Bill 1966. For the purposes of debate, I would suggest that, with the approval of the Minister for Customs and Excise (Senator Anderson), these two Bills be debated together. Of course, they will be presented separately, as is the custom, but to all intents and purposes they are complementary to one another and it is my intention to debate them together.
– There being no objection, that procedure will be followed.
– The two Bills give legislative affect to a wide range of tariff changes. The various schedules list 544 items. Many of the changes are as a consequence of the New Zealand-Australia Free Trade Agreement which was drawn up last year and which came into effect on 14th February this year. The Customs Tariff Bill (No. 2) also deals with tariff amendments arising out of reports by the Tariff Board on woven cotton fabrics, bed linen, woven man-made fibre fabrics, pigments and colour lakes, tinned iron and steel hoop, strip, plates and sheets, and magnetos and parts. It also deals with amendments arising from reports by the Special Advisory Authority on continuous filament polyamide raw yarns, woven fabrics of glass fibre, and polyethylene monofil and rope.
During the course of his second reading speech the Minister, in referring to the alteration in the tariff on man-made fibre fabrics, said that the Board had made recommendations in respect of uniform rates of duty of 55 per cent, ad valorem under the general tariff and 47± per cent, under the preferential tariff. The Board had recommended that these tariffs be imposed. The Minister pointed out that the Board’s recommendations on man-made fabric fibres would have far reaching effects on the local industry. He went on to say - lt would reverse the former pattern of protection which had been in force for some years and which encouraged local production of the lower value fabrics - for which long runs are available - and discouraged manufacture of the higher priced materials. As this might lead to a significant change in the industry’s pattern of production, the Government was concerned that the industry should have lime to make any adjustments it considered necessary without undue dislocation of production. Accordingly, it is proposed that the duties on man-made fibre fabrics will have a minimum rate of S0.20 per square yard. An upper limit of $0.50 per square yard is also proposed on all man-made fibre fabrics except some special fabrics used principally for furnishing.
That statement by the Minister on this aspect of the measure before us recognises that the New Zealand - Australia Free Trade Agreement and the tariff complex that exist are fundamental to the protection of Australian industries and that even though the Tariff Board may make recommendations in respect of some industries, specific industries should be protected.
It is to this aspect that I want to direct my remarks this afternoon because of the effect that this legislation will have on Australian primary industry. I refer particularly to the part of our primary industry in Tasmania that concerns itself with the growing of peas and beans and, to a lesser extent, to the impact that this legislation will have on our pig meats and cheese. In Committee, the Opposition intends to move a series of amendments to specific items contained in the Schedules which we consider to be vastly important to some sectors of primary and secondary industry in both Australia and New Zealand. At this stage, I propose to deal with the First Schedule which sets out amendments of Part II of the First Schedule to the Principal Act.
– What are the items?
– Item 07.05.2 1 1 , which deals with dehydrated beans. I will be discussing proposed new item 07.05.291. Dealing with peas, I will refer to proposed new item 07.05.412. The Opposition also intends to direct the attention of the Senate to proposed new item 07.02.1, which relates to peas and beans, frozen or preserved by freezing. Later I want to draw the attention of the Senate to the differentiation which I propose to make between peas preserved by freezing and dehydrated peas.
Article 3 of the New Zealand-Australia Free Trade Agreement states -
The member States shall from time to time jointly review the trade of both Member States in goods not listed in Schedule A to this Agreement with a view to the inclusion of additional items in that Schedule. Such reviews shall take into account all trade between the Member States and the effect which the addition of any item or items to Schedule
A to this Agreement would have on the economies of both Member States. The objective of these reviews shall be the progressive listing in Schedule A to this Agreement of all goods which enter or might enter into the trade of either Member State, except those goods the inclusion of which would be seriously detrimental to an industry in the territory of either Member State, or would be contrary to the national interest of either Member State, or would be inconsistent with the objectives of any commodity arrangement to which both Member States are parties.
Having read that passage, I submit to the Senate that the section of the legislation now before us which deals with beans and peas could bc seriously detrimental to the bean and pea industry in Tasmania. Over the last 10 years the area given over to the production of beans and peas in that State has risen from 4,000 acres to 15,000 acres. The growing and processing sections of the industry have developed their undertakings on the understanding that they would not be subjected to competition from duty free imports. In the light of that understanding, the processors have extended their annual processing potential to a value of $2i million. I have in mind the Dewcrisp undertaking at Scottsdale, the interests of Petersville Aust. Ltd. at Ulverstone and Devonport, which are the International Canners and Edgell undertakings, and the interests of H. Jones & Co. Pty. Ltd. at Circular Head.
The industry has gathered momentum, particularly as a result of the Hy Peak technique that was developed by the Commonwealth Scientific and Industrial Research Organisation. Displaying their usual acumen, the producers have adopted this technique for the rapid harvesting of their crops, for taking them to viners which have been established at strategic places, and for passing them through the freezing process. A very comprehensive marketing system has been developed to the stage where Tasmanian producers are now supplying 60 per cent, of the Commonwealth’s requirements of these commodities. The special areas that have been selected for the growing of beans and peas in Tasmania have shown very good results and increasing production per acre has resulted from the application of modern growing methods. The increase in acreage and the increased production per acre have been reflected in the fact that no increase in price has been granted, nor sought by the grower from the processor, because the leeway has been made up by higher efficiency. This is a very satisfactory situation, as it has kept steady the price of the commodity on the Australian market and the industry has been able to continue with confidence.
I believe that the Minister for Trade and Industry (Mr. McEwen) was misinformed - 1 do not feel that he would deliberately mislead the Parliament - when, during the course of his remarks in another place, he said that his advisers had given him information that the growers had entered into a new contract to cover production for this year. This is not the case. Last year the contract was entered into for a two years period, before the present arrangements were made under the New Zealand- Australia Free Trade Agreement. The contract will, of course, expire soon and a new agreement will have to be made next year.
– At what period next year?
– The season covered by the two years agreement between grower and processor is now completed. As the honorable senator knows, the season for pea growing finishes in late summer or very early autumn. Therefore, negotiations for the next agreement will come up between now and the next growing season. The growers will, I am advised, be under considerable pressure to negotiate a new price for the coming period of two years, or perhaps longer, as the industry will have to meet growing competition that will develop inevitably as a result of the Trade Agreement. As I mentioned, 60 per cent, of Australia’s present requirement of peas and 35 per cent, of its requirement of beans are grown in this special area in the north of Tasmania, and the return to Tasmanian growers is about $2.5 million a year, which is a considerable percentage of the total income received by primary industries from cash crops.
– The industry represents much more than $2.5 million, does it not?
– That is the return to the grower. The income of other sections of the industry - processors, carters and labour used in connection with the growing and harvesting of the peas - adds to the value of this industry.
– And the making of containers.
– I am reminded by Senator McKenna that the making of containers is another very important aspect of the processing of canned peas.
This Bill will bc seriously detrimental to the industry because many small farmers in Tasmania will have to compete against the inbuilt advantages that the New Zealand peagrowers have, or, for that matter, that New Zealand primary producers in general have. First, there is the advantage of the exchange rale. In adjustments to sterling, there is a 25 per cent, differential in New Zealand’s favour. Although the exchange rale has assisted our primary producers in selling their commodities overseas, in this instance it will act in the opposite way and give New Zealand a considerable competitive advantage. Secondly, wages in New Zealand, when equated with Australian currency, are lower than in Australia. Therefore, labour needed for the production of peas and beans, can be obtained in New Zealand at much lower rates than in Australia. There is a greater availability of farm labour in New Zealand than there is in Australia because New Zealand’s economy is essentially a primary producing one. On the other hand, the rapidly growing secondary industries of Australia face the farmers with continuing and increasing competition for casual or seasonal labour. There are other important, aspects which should not be overlooked. The high shipping freight rates on the Australian coast make the transportation of Tasmania’s primary products, particularly peas and beans, to Sydney almost as costly as the transportation of New Zealand products to Sydney. The difference would be less than three cents per 100 lb., which is infinitesimal when one compares the distance between New Zealand ports and Sydney and Tasmanian ports and Sydney.
I should like to dwell for a few minutes on a most important factor which has not been revealed to any great degree either in comments which have been made on the New Zealand-Australia Free Trade Agreement or in the legislation itself. I refer to the dehydrating process which has been developed by the Unilever company in New Zealand. This international organisation has had the good fortune to obtain world patent rights to a dehydrating process by which each pea or bean is put into a certain position, pierced with a needle similar to a hypodermic needle and then has the moisture withdrawn from it. During this process the weight of the pea or bean is reduced to one-fifth of the weight of the normally frozen article. In view of the comparable freight rates which apply, there is an advantage to New Zealand in the fact that 1 lb. of peas or beans, if dehydrated, weigh only 2 ounces. The information available at present on this dehydration process does not give a true indication of the threat that it poses to the Tasmanian industry. All the comparisons which have been made by the Minister in another place and all the comments which were profferred in this place during the debate on the New Zealand-Australia Free Trade Agreement do not take cognisance of the very significant difference between the frozen pea or bean and the dehydrated article. Another advantage is that the dehydrated pea or bean can be classified as general cargo because it does not need refrigeration. It can be packed in polythene bags or containers and does not need a set temperature for its preservation. The advantages which flow to New Zealand are the exchange rate, cheaper labour costs, the weight factor and the comparable freight rates between New Zealand ports and Sydney and Tasmanian ports and Sydney.
During thB course of his statement on 26th August 1965 the Minister. Mr. Mc Ewen, said -
At present, protective duties are charged on a sliding scale basis when the f.o.b. value of imports is less than Is. l0½d. per lb., that is, for every penny below ls. 1 0 id . two-thirds of a penny duty is payable. Under the Free Trade Agreement- and under this legislation - it is proposed that protection against import competition from New Zealand frozen peas and beans will be maintained for nine years.
He referred specifically to frozen peas and beans but made no mention of dehydrated peas and beans. He continued -
The first reduction in the duty for frozen peas and beans would not take place for 12 months after the commencement of the Free Trade Agreement.
This means it will commence on 1st January 1967.
– Next season.
– Next season, the immediate season facing the Tasmanian growers. The Minister then went on -
For the following eight years, duty would still become payable below the same f.o.b. value of ls. 10id. per lb. as at present, but the incidence would be progressively reduced to a duly free basis at the end of nine years. 1 should like to refer to an article on this subject which appeared in the “ Sydney Morning Herald “ on Monday, 9th May, under the heading “Trade Across the Tasman “. It was written by Mr. Lachie McDonald in Auckland. Speaking of a seminar to be held on 16th May at Auckland, as part of a long term drive to banish lingering New Zealand suspicion of Australian sincerity in the desire to foster reciprocal as well as one way trade, Mr. McDonald refers to the interest that signatories to the General Agreement on Tariffs and Trade have been taking in the Agreement. He states -
On the other hand the G.A.T.T. attitude is seen in some quarters here as giving Australia time to reorganise or phase out a dairy industry regarded as incapable of competing, even on its home market, with produce from New Zealand.
That has particular reference to the byproducts of dairying, such as cheese and pig meats. I will refer to them and to other subjects at a later stage.
– That does nol apply to dairying generally, does it?
– The article states-
On the other hand, the G.A.T.T. attitude is seen in some quarters here as giving Australia time to reorganise or phase out a dairy industry regarded as incapable of competing, even on its home market, with produce from New Zealand.
– Mr. McEwen makes the point that only the importation of cheese is permitted.
– That is true; but the point is that a report on the dairy industry has been presented to this Parliament and in that report certain recommendations were made for phasing out incompetent or uneconomic farmers. It would be political dynamite to implement that report. Nevertheless, there are very grave defects in our dairy industry. It is admitted that, because of climatic factors, the fertility of its soil and other factors, on an even footing New Zealand can compete more than successfully with other countries. I draw the attention of the Senate to that fact in order to lead up to the following statement in Mr. McDonald’s article -
The Minister for Overseas Trade, Mr. J. R. Marshall, reports that more New Zealand businessmen are now exploring opportunities in Australian markets. He says the chief reason is provision in the agreement for phasing out over eight years duties exceeding 10 per cent. “ At the end of four years, when 60 per cent, reduction should apply, we will see significant improvement in our trade,” said Mr. Marshall a few days ago. Mc specifically mentioned fish and frozen vegetables.
On one side of the Tasman the New Zealanders are expecting a significant improvement in trade, as Mr. Marshall said - specifically mentioning fish and frozen vegetables - and on this side of the Tasman our primary producers are making representations to the Parliament such as the following, which I quote from a letter from the Canning Pea Growers Association of Tasmania -
After careful study of all available information, we arc still of the opinion that the inclusion of green processed peas and beans in the Agreement is a serious risk to the stability and growth of the processed pea and bean industry in Tasmania.
The Australian Primary Producers Union, in a letter last year, listed various factors that would be detrimental to the Australian industry. In paragraph 4 of its letter, the Union said -
The growing of peas and beans for processing is located in areas peculiarly suitable to their production and alternative forms of production could be either less rewarding or difficult and must involve some dislocation.
The growing and processing of these vegetables now constitute significant factors in rural economies and even State economies - particularly in Tasmania.
New Zealand has, for many years, supplied the bulk of the pea seed used in Australia, and therefore should not be permitted special privileges when selling the end product in competition with local production.
The growing of nitrogen fixing crops such as peas and beans constitutes desirable farming practice.
If this industry in Tasmania is phased out, there is no shadow of doubt in the minds of the people connected with it that it could meet the same fate as the berry fruit farmers in the south of Tasmania have met and as the potato growers are meeting as a result of the present prices on the Sydney market. Those prices have resulted in a tremendous reduction in the area under potatoes. The pea growing industry not only produces a lucrative cash crop with a high degree of mechanisation but also puts back into the soil the important element of nitrogen which increases the fertility of the soil. The phasing out of this industry would represent a great loss to the farmers who are interested in the production of these commodities. The Australian Primary Producers Union also said -
Since the 1958 Tariff Board inquiry into processed vegetables, the Australian industries have increased in efficiency largely due to the increased sci lc of production and the accumulation of growing and processing “ know how “.
As J mentioned earlier, this knowhow was the outcome of research and investigations conducted by the C.S.T.R.O. which made available to the industry knowledge of when the product reaches it most efficient stage. I understand that that stage is before the sugar starts to form into carbohydrates, when the product is at its sweetest and most edible stage. By combining that knowledge with the knowledge of when to harvest and the results of developmental work that has been carried out in relation to the manufacture of industrial equipment in the harvesting, vining and snap freezing fields, the processors have made a contribution to increasing the scale of production and distribution of these commodities. If duty free imports are permitted, the only way that the producers can see of meeting that competition is to reduce prices to growers and to insist on conditions in contracts which are less acceptable to growers. If I know anything about the business methods that exist today, that would be the logical sequence of events. The grower, being more or less under contract and having no other outlet, would have to accept the terms and conditions offered to him by the processor who, in turn, would be actuated by the competition from the New Zealand product.
Another point that I would like the Minister to bear very well in mind is that, as far as I can see, the frozen pea or bean may have reached the zenith of its popularity as a table commodity and may be on the decline. The people who heard of the sample shipment that came to the supermarkets, chain stores and other distribution points from New Zealand under the trade name of “ Surprise “ were interested in sampling the product, possibly out of curiosity. I have received reports to the effect that when these peas are cooked they expand to the size of the normal fresh garden pea or to the size to which the frozen pea expands, and that their taste appears to be equal to, if not better than, that of the frozen pea. Yet the price variation between the two commodities is that dehydrated peas sell at 2 oz. for 2s. and frozen peas are selling at 10 oz. for 2s. 6d., which evidently is the cost plus a profit margin for the frozen pea processor and distributor. That factor alone poses a threat to the growers in Tasmania because of the complex that has been established in that State with confidence by the processors, who in turn have given confidence to the growers to continue to expand their acreages, to bring new areas into production, to develop new techniques in growing and harvesting and, to increase almost annually, the yield per acre. All of these things have been done in the light of the secure position that the frozen pea processors thought was in their favour. A basic threat to the whole structure is inherent in this legislation. Some of the points I have just made have been elaborated on in the letter from the Australian Primary Producers Union. It slates -
The newly developed New Zealand process for dehydrating peas is patented by one company (Unilever). These peas are packaged in 2 oz. cartons, but are equivalent when reconstituted to 10 oz. of frozen peas. This product is therefore not one able to be met by the Australian industry generally in full competition. Even under the present scale of duty, their advantage is considerable (and their freight advantage also), but if permitted duty free entry, the effect would be even more serious.
The situation is aggravated by the fact that Australian producers have just engaged in substantial capital expansion in the field of frozen vegetables. The figures cited in the letter is £3,500,000. For that reason, they are in no position to develop the necessary new techniques at this stage. The industry is in a cleft stick. The producers have committed themselves to the limits of their financial capacities to one form of processing. Their positions are threatened by another form of processing, the rights to which they cannot obtain by negotiation. They are prevented from copying the process because the patent rights are held by Unilever (Australia) Pty. Ltd. If the Unilever organisation grows its own supplies on the mainland - it has admitted that it is experimenting with pea growing on the mainland - the cost of freighting the vegetables from Tasmania will be eliminated. In that case, the Tasman ian industry will die because the Tasmanian product could not compete with the product grown on the mainland. The alternative would be for the Unilever organisation to enter into partnership with the Tasmanian producers, but with everything to gain and nothing to lose, there is no reason why it could not set up its own exclusive processing factories in Tasmania and exploit the vast potential of the Tasmanian pea and bean growing areas. In that event the present processors would be eliminated. They could be phased out prior to being closed up or to entering another area of vegetable processing in which pressure might be exerted on them.
We oppose the plan to eliminate tariff duty on peas and beans over a period of nine years in the sincere belief that unless another look is taken at this aspect of the New Zealand-Australia Free Trade Agreement as it affects specifically the Tasmanian producers of these commodities, the claim that the Agreement is of mutual advantage cannot be sustained. To a lesser extent, growers in Victoria, New South Wales and Queensland will also be affected. For this reason, 1 believe that very serious consideration should be given to the points I have raised.
I turn now to deal with the proposal regarding cheese. It has been said that cheddar cheese has been included in the Agreement subject to a provision limiting the quantities to be covered by the duty free arrangement. The present duty on cheddar cheese is 6d. per lb. It was pointed out by the Minister for Trade and Industry in his statement of 26th August last that imports of cheddar cheese, which have amounted to between 200 and 250 tons in recent years, will be limited to 400 tons in the first and second years of the Agreement, and to 800 tons in the third and fourth years. In the fifth and subsequent years the quantity will rise to the ultimate ceiling of 1,000 tons. The price at which the cheese is marketed will be subject to agreement between the Australian and New Zealand dairy boards. It is quite simple to evaluate the feelings of people who are producing cheese and are interested in developing their industry. They are specifically sorted out as being expendable to this degree in the general arrangements between the two countries.
– To what degree is that when compared with the volume of production in Australia?
– Senator Webster, in his very sound contribution to this debate, pointed out that the proportion was not of great significance. Nevertheless, it is of sufficient importance to those people who are balancing the products of a mixed farm. On the same farm a producer may be concerned with pigmeats, cheese, peas, beans and dairy cattle. A great number of farmers in my State are in just that position. As they see agreement being reached and legislation being introduced which affects practically every aspect of their production, they see every source of their income being written down in order to correct the imbalance of trade between Australia and New Zealand. I believe that this imbalance is quite rightly being corrected. I think there is justification, however, for the Tasmanian producers attempting to have alleviated the provisions of the Agreement which will adversely affect their income, even though those provisions will make a difference in income of only $3 a head over the whole of Australia, as Senator Webster has said. The people who rely on mixed farming for their incomes must bear a heavy disadvantage because of this legislation. Therefore, we say that further consideration could be given to the provisions of the Agreement relating to cheddar cheese.
At the Committee stage of the debate, the Opposition intends to move an amendment which relates to pig meats. The Minister has said that pork has been included in the Agreement subject to a provision limiting the quantities to be covered by the duty free arrangement. The present duty on pork is 3d. per lb. or 10 per cent, whichever is the lower. Under the Agreement, the duty will be phased out after two years. I have already quoted the comment made in New Zealand that the chief reason for businessmen taking keener interest in the opportunities in Australia is the provision for phasing out, over a period of years, duties exceeding 10 per cent. Australian producers of pig meats - ham, cured pig meats, bacon and the like - believe that their section of the primary producing industry is being adversely affected so that the metals and manufactured machinery industries may benefit from the terms of trade negotiated between these two countries. The case that I have presented covers the parts of the legislation in which we are specifically interested. In the Committee stage we will go into much more detail when discussing the various items. I should like, finally, to quote to the Senate a letter from the Canning Pea Growers Association of Tasmania, which, in part, states -
Much has been said by Ministers for the Agreement’s Suspension of Obligation clauses under which an industry may act in certain circumstances. However, the onus is on the industry, in this case processors and growers, and past experience has shown this to be a difficult process and, as production is predominantly in (his State, an unsatisfactory form of protection.
Apparently nothing further can be done about the Agreement, but members of the Association consider that when this legislation is before the Parliament these points should be hammered as hard as possible in order to make honorable senators aware of what, in the opinion of the growers, will be the inevitable result of alterations in the tariff rates. I feel that manmade fibres and various other commodities that I mentioned earlier in my remarks would be better dealt with in the Committee stages. I ask the Senate to give very close consideration to the points I have raised in relation to peas and beans. If this question is not finalised now, the growers will be adversely affected by the fears of the processors about future competition and confidence in the industry will be undermined. I am sure that people throughout Australia, and particularly in Tasmania, would be very sorry to see such a thriving and progressive industry decline in the way that seems inevitable if this legislation is passed.
.- Senator O’Byrne has, quite properly, drawn the attention of the Senate to an industry in which one State - Tasmania - has a special and peculiar interest. He has drawn attention to the effect on the industry of the application of the New ZealandAustralia Free Trade Agreement, to which legislative effect is to be given by the Bill now under consideration. I feel that the Federal Parliament has a special obligation to consider this matter most carefully, because, although this industry is small, it is nevertheless of real value to Tasmania. Peas and beans are cash crops which, in north western Tasmania, have taken the place of a previously well established cash crop - potatoes. The Federal Parliament has a special responsibility now because one of the greatest factors contributing to the diminution, almost the destruction, of that crop is the bad arrangements which have been made for the shipping of cargoes from Tasmania to the mainland. That is a Federal responsibility. We know only too well that since World War II the cost of shipping cargo from Tasmania to the mainland markets has become prohibitive and, with other factors, has reduced the Tasmanian potato crop to insignificant proportions, relative to its pre-war size.
It was a matter for congratulation that, with the increasing use of irrigation, northern Tasmania was able to turn its fertile land to the growing of cash crops in the form of peas and beans for freezing. Senator O’Byrne indicated the extent of the development of that industry when he said that in 1950 these crops occupied some 4,000 acres and that now they occupy from 13,000 to 15,000 acres. Some peas are required for seed and others are discarded because they are the victims of frost and so on, but those figures show that the industry has grown to something like three times its former size in a matter of eight or ten years. I believe that its value to the economy of Tasmania is about £5 million per annum.
In considering the legislative proposals to implement the New Zealand-Australia Free Trade Agreement we should not think exclusively of the interests of one industry. We should bear in mind the general advantages and disadvantages of the Agreement. When the general subject of the Agreement was last debated in the Senate we heard two speeches of very special interest which gave particular point to the theme that I now wish to emphasise. From our side, Senator Cotton spoke of the Agreement as a 10 year Agreement - continuing, however, indefinitely after that period - which would stabilise the advantageous differential that we enjoy in trade with New Zealand. By endeavouring to summarise Senator Cotton’s speech 1 may be doing him a grave injustice, but it is sufficient for my present purpose to state his speech in that summary form. Immediately following Senator Cotton in that debate, Senator Devitt from Tasmania explained in detail the disadvantages that would be suffered by the Tasmanian pea and bean industry. 1 cannot help but think that - in the Senate all States are equally represented for the purpose of giving State interests proper representation by way of review - when we bring those two views together neither can, in the absolute, be regarded as sound. Tt is only when they are considered relatively that each is acceptable. When we start to consider acceptance of a trade agreement which, as to 60 per cent, of the national trade of two countries, attempts to free that trade of import restrictions over a period of, I think, eight years, it seems to me that we have to take a very special look at those industries within our jurisdiction that are going to be hit and to consider what assessment should be made of the advantages expected for them.
If one looks at the figures relating to trade between Australia and New Zealand, one finds that the great exports from Australia to New Zealand - and I lake those of obvious magnitude - were as follows -
I have selected a few of the major exports to New Zealand to show that obviously the great advantage of this Agreement accrues lo the motor vehicle industry and the industries manufacturing heavy industrial products. The industries that will be hit within Australia are those in respect of which we can anticipate increasing imports from New Zealand. Knowing the degree to which New Zealand has geared her economy in respect of agricultural production, it is obvious that she is expecting to expand her agricultural exports to Australia.
This poses a very anxious question for anybody who accepts the responsibility of representing Tasmania in the Senate. The pea and bean industry, which is a small industry, is at risk by reason of the existence of this Agreement. No arrangement has been made for the big secondary industries that will receive advantages from the Agreement, by stabilising and expanding their New Zealand markets, to provide a corresponding advantage to the pea and bean industry. Therefore, I have very anxiously approached this question. Along with most other honorable senators from Tasmania, I had the advantage of attending a meeting in Ulverstone some three months ago. It is heartening to have the privilege to represent the earnest people who expressed their views on that occasion. I say that because it is all too easy to forget in this Parliament that we speak as spokesmen of the people and not as supporters of governments. We do not come here to support governments. We come here to represent people. I have approached this question, giving it the best of my consideration.
The first thing that I want to bring before the Senate is that the production of frozen peas has risen from 36.2 million lb. in 1961-62, to 33.7 million lb. in 1962-63; to 37.8 million lb. in 1963-64, and 57.1 million lb. in 1964-65 - this is the preliminary figure; the actual figure has not yet been definitely ascertained. From 30th June 1962 to 30th June 1965, Australian production increased from 37 million lb. to 57 million lb., which is an increment of approximately 50 per cent. For the same four years the imports into Australia were 9.7 million lb., 0.9 million lb., 4.4 million lb. and 5.3 million lb. There has been no great surge in imports.
If one takes the consumption of frozen peas in Australia, one finds that for the same four years the consumption has risen from 44.9 million ib. in 1962-63 to 61.1 million Ib. in 1964-65, which indicates that the Australian market has been able to accept both the huge increase in Australian production and the rather stabilised quantity of imports. Another factor which is significant to my mind is that in the four years which I have mentioned, imports, as a percentage of consumption, represented 21.6 per cent, in 1961-62, 2.8 per cent, in 1962-63, 11.2 per cent, in 1963-64 and 8.7 per cent, in 1964-65. Imports, as a percentage of our consumption, have been of a diminishing relativity. Mr. President, in order that we may have the figures in graphic form, with the concurrence of honorable senators, 1 incorporate the table in “ Hansard “.
– Would not those figures indicate that the imports were necessary to meet Australian demand?
– I do not go so far as to say that. All I say is that the capacity of Australian consumption has been equal to accepting both the huge increase in production and the rather stable quantity of imports. I am not aware of any deficiency in the Australian production that would enable me to say that it is necessary to bring in that degree of imports to meet the demand.
– Has the increased production in Australia been consumed locally?
– Yes. I have indicated that the consumption has increased from 44.9 million lb. in 1961-62 to 61.1 million lb. in 1964-65. I have not troubled to analyse figures relating to a few other exports, but the consumption of frozen peas in Australia has been equal to accepting both the increased production and the rather stable quantity of imports.
The next matter to which I turned my consideration was the actual imports into this country. I regret that through some inattention the table has slipped from my file. But I shall state the matter generally in this respect. It will be found that the imports of frozen peas into Australia have not been of very great quantity and that the increase, if any, in the importation of frozen peas has been insignificant. In fact, in the last three years, the imports from New Zealand have declined from approximately 3 million lb. to approximately 2 million lb. In the statement for the last period, the imports from New Zealand do not exceed 2 million lb. a year. I find that in the last nine months the imports, multiplied by the appropriate factor of six in order to express the weight in terms of fresh peas, are not more than 1 million lb. or 2 million lb.
– All those imports were not faced with import duty.
– Yes, quite so. They were riding under whatever control is exercised by import duty. I am coming to that point in a moment.
Having stated the position with regard to these imports from New Zealand, I want to refer to the position in relation to imports from America. Three years ago, we were importing from America approximately 5 million lb. or 6 million lb. of these products. I remember stating to the growers at Ulverstone that, if we could prevail upon the Tariff Board to recommend a reduction of imports from America, we might more than offset any advantage that New Zealand growers would gain by the New Zealand-Australia Free Trade Agreement. To my mind, a great impact was made in the position last year when the Government passed legislation enabling it to dispense with the provision requiring the factual investigation of invoices with respect to the prices of American exports to this country. It is now competent for the Department of Customs and Excise to substitute an estimate of the true cost in America of these pea exports. Through the incidence of that provision, as influenced by the Department of Trade and Industry, our frozen pea imports from America have been: In 1962-63, 65,000 lb.; 1963-64, 1.2 million lb.; 1964-65. 3.1 million lb.; and in the nine months to March 1966, 1.2 million lb. So, if I am correct in attributing that reduction to the hardening attitude of the Department of Trade and Industry in exercising the new authority that it has to protect our industries from what is pseudo dumping from America by estimating the cost of imports instead of arriving at a figure after a delayed and difficult investigation, then I conclude that the Department has affected a reduction of approximately 2 million lb. in one year. As I have pointed out, our imports of this commodity from New Zealand in 1964-65 were 2.07 million lb. The adjusted import for the first nine months of this financial year is approximately 1 million lb. only. So, the benefit gained by the restriction of American imports more than outweighs the total New Zealand import in the same period. Madam Acting Deputy President, I now have the relevant figures, and with the concurrence of honorable senators, I incorporate this table in “ Hansard “.
I now wish to deal with a special aspect of imports from New Zealand. This matter was adverted to by Senator O’Byrne. I refer to the class of dehydrated pea which, 1 believe, is under world patent right to Unilever (Australia) Pty. Ltd. and is called the “ Surprise “ pea. The New Zealand exporter can contract the fresh pea to approximately one-sixth or one-fourth of its natural bulk. I believe that, when prepared for the table, it is in a very acceptable and delicious form, resembling a natural pea more closely than perhaps does any other processed form of pea. It would be expected that the New Zealand producer would have great advantages in Australia. The New Zealand exporter can get his processed product into Australia at one quarter of the weight of the fresh pea product. Therefore, having regard to the relative freights, New Zealand to Sydney and Devonport to Sydney, we can see that the New Zealand exporter has an advantage.
I shared the concern with regard to the competition from this product particularly as I have been informed that the import into Australia of this New Zealand pea for the last nine months was approximately 166,000 lb. This figure, when multiplied by my factor of six, gives a quantity of approximately 800,000 lb. for that class of product alone. But I am assured by the Department of Customs and Excise that the figure includes the old type wrinkled pea upon which since 1933 there has never been any duty and that the true figure of the “ Surprise “ pea for the nine months to March 1966 is only 8,700 lb. That figure is insignificant, on any basis, up to date.
I learned also, from the inquiries that I have made, that Unilever is conducting that export at a loss. I would not pretend to understand whether there is any significance attached to that fact. But this information suggests and to my mind, actually affirms, that if the Australian market becomes a profitable market for this processed pea it will be a natural thing for Unilever to establish its factory in Australia. Gippsland has been mentioned in this connection. I hope that, with proper political guidance, if Unilever does establish a factory in Australia, the Tasmanian depot would be the one that would suggest great advantages to the company.
– Hear, hear!
– In fact, 1 think that has not been ignored. But these things such as Unilever’s operation are matters of speculation. I do not pretend to have such a practical mind as to be able to make a practicable judgment on this matter. I make these comments only to offer to the Senate information which in its judgment may be of relevance. To my mind, the relevant factor is that in the last nine months the total import of New Zealand “ Surprise “ peas into Australia amounts to only 8,700 lb. which, when multiplied by my factor of 6. gives approximately 50,000 lb. of fresh peas at most. In relation to the figures that have been mentioned, that is not of much consequence.
The next factor to which I turn is the potential of the New Zealand competition. I have sought information about the trend in New Zealand’s production of frozen peas. In 1960-61 it was 20.6 million lb. and for succeeding years it was 22 million lb., 25 million lb., 27 million lb. and 24.7 million lb. Australia’s production for last year was 57 million lb. It will be seen that New Zealand’s production has hovered between 20 million lb. and 27 million lb. No doubt that production has been somewhat restricted because of the fact that the Australian market has been marginally protected against New Zealand imports. Imports of the New Zealand product amounted to 3 million lb. in one year, 2 million Ib. in another year, and in the most recent year, after making an adjustment for “Surprise” peas, it will not exceed H million lb. It is against that background that the apprehension of the Australian pea industry must be measured against the advantage that it is proposed to give to the New Zealand industry under the terms of the Agreement.
Let us consider that advantage. At the present time the Australian pea industry enjoys this protection: If the f.o.b. value of the import falls below ls. 10* d. per lb., a duty of two-thirds of a penny for every penny of shortfall in the f.o.b. price below ls. 103d. is added. It is not an absolute, overriding protection whereby every item exported by New Zealand to this country has to bear a duty that will give an advantage to the Australian competitor. The protection is afforded only where the f.o.b. price of the New Zealand export falls below is. l0½d. a lb. The price is adjusted so that, with duty, the shortfall will become only .33d.
It is proposed, under the terms of the Bill, to phase out that advantage over a period of eight years, commencing from 1st January 1967. On the figures that 1 have mentioned, I am compelled to accept the conclusion that the competition to which the Australian pea industry will be subjected as a result of the advantage that is to be given to New Zealand will not be of great significance. I share the concern of the growers, particularly in the light of their experience with potatoes. Moreover, I recall the unavailing and continuing despair with which I advocated some redress for the small berry fruit grower in Tasmania. I did not receive any assistance from the Australian Labour Party in my advocacy. After nine years we did get some redress. But that is not good enough. If I thought that there would be inflicted upon the Tasmanian pea grower anything like the treatment that was inflicted by this Parliament on the Tasmanian berry fruit grower at the instance of the sugar industry, I would vote against the Item in question boots and all.
– I hope the honorable senator does.
– I shall not do so. I have already said that, after considering all the facts, my conclusion is that the competition with which the Australian pea grower will be confronted as result of this legislation will not be of great significance.
– What does the honorable senator think the position will be like in six or seven years’ time?
– I propose to make a suggestion which, if adopted, will afford protection. I hope the Senate will consider this factor: If, as Senator Cotton and other honorable senators have suggested, great advantages are to be derived from the New Zealand-Australian Trade Agreement, if there is any possibility of New Zealand being disadvantaged by England’s entering into the European Common Market, and if, in order to maintain her prosperity, she has to find a new market for her primary products, we will be furnished with a terrific opportunity to provide that market. In the light of that possibility I ask myself: Is it of great advantage to the farmer of northern Tasmania for Australia to send more Holden cars, more iron and steel, and more sugar to New Zealand? I must admit that the direct advantages will be enjoyed by the industries which produce those products; but as we enable those industries to gather Strength we will build a strong Australia from the standpoints of defence and prosperity. I cannot deny that, as manufacturing industries grow, more people will be required to produce the consumer goods that personnel employed in those industries will need. That is over-simplifying the matter. Nevertheless, to my way of thinking, that is the reality.
– They might be consuming New Zealand peas instead of Tasmanian peas.
– Yes. In my view, the appropriate way in which to deal with this Bill would be to allow it to operate for two years and for the Parliament to reserve the right to consider it then in the light of experience. I hope that honorable senators will consider that suggestion. At the Committee stage I shall move a request or an amendment, whichever is the appropriate form, to give effect to my suggestion. If adopted, it would mean that the legislation would operate for two years from 1st January 1967. It would have to come before us again before 1st January 1969. I put forward that suggestion as affording effective protection for the industry. It has been stated that the New Zealand-Australia Free Trade Agreement makes provision for pro tective mechanisms which can be set in motion by the Minister for Trade and Industry or an industry panel. A request may be made for a cessation of the phasing out process if the Australian industry is seriously damaged, suffers serious detriment or suffers extreme injury, to use the various terms that have been employed in the Agreement. I have ascertained that in Article 7 this is applicable only to canned peas and it would not, I think, affect frozen peas, but 1 call attention to the breadth of meaning of the words in that Article, which go beyond the “ serious injury “ with which we are more familiar in the customs legislation. I feel that we want Parliamentary protection so that at a particular time the continuance of this phasing out will come before the Parliament for decision, whereas the implementation of those departmental mechanisms will take time. A department is not always receptive to the advocacy of a very small industry such as Tasmanian industries are and I would seek to add to the protective mechanism of this Agreement the right of the Parliament at the appropriate time, after two years’ experience, then to register its judgment. I am grateful to the Senate for the attention that it has given to this rather tedious presentation of facts and figures on a commercial subject, but it is a commercial subject that is of very great and earnest interest to a valued section of producers, and it was my duty to explain the reasons for the decision that I have come to as the proper decision upon this measure.
.- It will be recalled that on 21st April, when we were discussing the New ZealandAustralia Free Trade Agreement, I spoke at some length on various aspects of this question, which is of such concern to the producers in my home State of Tasmania. So I propose not to weary the Senate with tedious repetition of the points which I made on that occasion. Perhaps it would serve a better purpose if I should now bring the Senate up to date on some further facts which have come to my knowledge in the meantime. There are a number of very interesting aspects of this subject, and it is reasonable to expect that honorable senators who have not come as closely in touch with the matter as have those of us in the area where these peas are grown may be at a disadvantage in not knowing the actual and factual position regarding it.
I start upon the basis that in the past ten years there has been a 500 per cent, increase in production of peas in Tasmania. This is based upon an acreage of about 16,000 or 17,000 acres. The potential of Tasmania, under current conditions, has been assessed at 32,000 acres. This is working on the basis of a five years’ rotation, which indicates - to me, anyway - that Tasmania has a total area, suited to the growing of peas and beans, of about 160,000 acres. I can also tell the Senate that, while this assessment has been made in the past two years or so, recent developments in agriculture indicate that rotation can be increased quite easily and quite properly from five to three years. In fact, in some countries it has been found quite possible to have an annual cropping of the same area without any detrimental effects. So it can be very quickly seen, I believe, that it is conceivable that Tasmania alone, which at the moment produces 70 per cent, of the total Australian crop, could meet the whole of Australia’s requirements in the foreseeable future. An important consideration, which I hope the Senate will weigh very carefully when making a decision upon this matter, is the potential capacity to grow peas to meet local consumption.
I think Senator Prowse raised a question concerning importation of peas. Certainly there has been a shortfall - a very minor one, I suggest - in our production to meet home requirements, but very quickly this deficiency in total production can be made up by the potential of the areas suited to the growing of peas in Australia. For the life of me, I cannot see why we are launched upon a policy of permitting importation of peas in a quantity which will not damage local industry. Surely if this Agreement, so far as it concerns peas, is to be in any way effective and helpful to New Zealand, these imports will have to flow into this country at a substantially greater volume or rate. If the increase is to be of an insignificant character but will at the same time pose some threat to a local industry, why in heaven’s name proceed with it? The only conclusion that I can draw from this is that in a very short space of time these imports will flow in at a much greater rate and then serious damage will be done - not threatened - to our local industry. When I spoke on this matter on 21st April, I mentioned the 29 per cent, wage advantage enjoyed by New Zealand. Surely if the time arrives when there are no import duties on the peas, with New Zealand enjoying such a marked advantage in labour costs, it will be much easier to have peas exported to Australia. Growers in the pea industry have in recent weeks been advised that it is expected by the cannery people that, as a result of a review, the contract price for peas in 1967, which will be effective in 1968, will be reduced.
I suggest in all sincerity that if there were no threat from an outside source to the existence of this already established, flourishing and developing industry, it would be most unusual indeed, in the light of the presently increasing cost of production, for any organisation to suggest to growers that they would have to consider a reduction in price. Certainly, as I mentioned in my earlier remarks, there has been a spectacular rise in the total output of peas in Tasmania. Production has increased by 500 per cent, in the last ten years. It would be reasonable, I suppose, to expect that, all things being equal, there would be some basis for reduction of costs, but the industry has had a pretty good look at this and has found that with rising costs over the years it has been able only just to mark time, as it were. The growers have, in fact, been hoping that the time might arrive when there would be some increase in returns. Instead of that happening, the processors have told the growers that they will be expected to give favorable consideration to a reduction in price. Does this not indicate that there is already existing a serious threat of damage to this industry? If this is so, I would suggest that the protective provisions of the Agreement should be invoked immediately. In the light of the fact that, notwithstanding these things, the Senate proposes to complete ratification of this Agreement and to approve the proposals contained in the Bill now before us, I believe that the industry is in dire danger of stagnation and that there is a very distinct possibility of decline.
It has been noted that the factories where these peas and beans have been processed in former years have undertaken expansion programmes. In this current year these programmes, I understand, have been curtailed or suspended. Here again is an indication of some threat to the industry. As the production of peas and beans has expanded it has been the usual practice for the factories to expand and develop their facilities for handling these crops. As 1 have said, they have now suspended their proposals for expansion. There will be no expansion of their existing potential. This seems to show beyond a shadow of doubt that they expect that the industry will not develop further. This is quite a serious matter, and 1 invite the Senate to give it pretty close attention when we reach the stage of voting on the proposal. In addition, in recent times two vegetable processing organisations carried out a survey of parts of the north west coast of Tasmania with the object of assessing the potential there for the establishment of factories to treat vegetables of one kind or another. As a result, no doubt, of the incidence of this Agreement these two organisations have suspended their activities at least for the time being. Here is another serious threat to the livelihood of the primary producers in this part of Tasmania.
I said earlier that the Department of Trade and Industry must surely be expecting some acceleration in imports. If imports do increase, the Australian industry will be seriously damaged. In a recent statement the Minister said - quite incorrectly - that Tasmanian producers had entered into contracts for next year on current prices and that therefore they must have been happy with the arrangements. For the information of honorable senators I point out that the contracts were negotiated on a two year basis. The last agreement was negotiated for the years 1966 and 1967. Whatever the industry feels about the new proposal, it is bound by contractual commitments to supply the products in question at the broad level of 5id. per lb., the price applying in the previous year. The year in which the industry will have to face the music is 1968. On the one hand, it will be confronted with the detrimental effects of the Agreement; on the other hand, it will be confronted by the manufacturers with a proposition - I suggest it will be a pretty serious and definite ohe - that the price of these commodities be reduced.
In all seriousness, I do not think this situation can be tolerated. I have suggested that when this Agreement comes into operation there will be stagnation in an industry which has been very important to Tasmania. 1 believe that peas and beans comprise something like 25 per cent, of the total primary produce of Tasmania, so the economic effect of the Agreement over a substantial part of that State is obvious. 1 do not want to weary the Senate by rehashing what I said on an earlier occasion. I rose to bring the Senate up to date on some of the developments relating to this industry.
I want to make the point quite strongly that the Agreement provides within its terms for measures to be taken to protect industries whose existence is threatened, or when there is a possibility of an industry being seriously damaged, or when there is a possibility of serious detriment to an industry or when extreme injury can come to an existing industry. I believe that already this industry is under serious threat. I have indicated that there has been no expansion of factory accommodation; that two vegetable processing organisations have suspended their survey of an area to see whether it was practical to provide additional factories to treat vegetables, and that the growers have been faced with a possible reduction in the price of these commodities. I suggest very strongly that this is the result of creating a potential for importing articles into Australia at much lower prices than the prices at which they can be grown here. For these reasons, I believe that a serious threat to the industry now exists.
If we carried out the express terms of this Agreement we would immediately ensure that there were no further imports of peas into Australia. We have the ability at present to supply the Australian market, I do not see any great advantage flowing to New Zealand in respect of peas and beans. The present level of imports does not give a great deal of advantage to New Zealand. I cannot see how New Zealand would be helped in the future unless these commodities were imported into Australia at a far higher level than is the case at present. Surely it is understood that while an Agreement of this nature is in the offing, it is normal business practice for those who might cause a great inflow of a particular commodity into a country to soft pedal for a time until the Agreement came into operation. With the more favorable conditions contained in the Agreement, they would be able to accelerate the flow of exports.
There is a great deal of uncertainty at present. As a direct consequence of this Agreement, the economic existence of a great many small farmers in my State of Tasmania is under a greater threat than has ever been the case in the past. No doubt this would apply to other States as well. Is it any wonder that one rises to his feet to try to protect the existence of these farmers? We have seen already an undesirable trend in the increasing number of people flowing to the cities from country areas. We talk about this matter almost daily, but by this Agreement we are doing all that we can to accelerate that undesirable trend. We should be engaged in a serious consideration of ways and means of keeping people in the country areas and of stepping up the production upon which this country has grown. Our primary industries have enabled us to expand our secondary industries, particularly in the postwar years. I believe that they have done a magnificent job in that respect.
I know from my own experience the long hours that are worked on a farm and the small return that the small farmer receives after all his expenses are met. But he is committed to this sort of life. He likes it. He is a valuable member of the Australian community. In all conscience, rather than doing something which will be seriously detrimental to and will cause the stagnation and ultimate decline of this industry, surely we ought to be exercising our minds in endeavouring to find ways and means of ensuring that the small farmer is encouraged to stay on his property. We should not be introducing measures which can have little value to New Zealand but which, in the course of time, can have extremely detrimental effects on the people of Australia.
– lt would appear that the battle has already been lost. This debate reminds me of an occasion about two years ago on which I was ridiculed by honorable senators when I stood up in this chamber and said that >the Senate should be abolished because it is no longer a States House but is a parties House. In the few years that I have been in this chamber I have not seen one division carried out on a States basis. However, I am informed by the great authorities that on at least two or three occasions since Federation the Senate has acted as a States House. Since the introduction of proportional representation, I have never seen the Senate take any action on a States basis. This debate today confirms my view that the sooner the Senate is abolished the better it will be for the taxpayers.
We have heard some very able speeches on this Bill. I do not want to go over all the matters again. Obviously we will not persuade anyone to vote our way. However, I would like to make one or two points. Senator Wright made a most able speech. I enjoy listening to him because he puts his words together very well, he always has his facts at his fingertips and he is an able speaker. Of course, we in Tasmania know that he shouldered, almost alone, the fight for the berry fruit industry against the Commonwealth. He often used to tell us that he did so on the ground that Tasmania is the smallest State and the Senate should uphold the rights of the smaller States. But today he seems to have lost his keenness and enthusiasm for supporting the smallest State. That makes me begin to wonder whether his great fight for the berry fruit industry was not just a matter of choice of habitation rather than of the smallest State having a worthy supporter in this chamber.
– He might have been third on the list of Government candidates for the next election.
– The point is that he lives in the south and the peas are grown in the north, whereas the berry fruit is grown in the south and not in the north. I am afraid that I am a little disappointed in him for, while posing as the champion of the smaller States, so readily, so willingly and so easily giving up the fight for the State of Tasmania just because the pea industry is in the north of the island.
– Only a few miles separate the north from the south.
– That may be so; but those few miles affect the votes. It is unfortunate that Senator Lillico has not been present today. He assured a committee - I can well believe this - that he was totally opposed to this measure. I do not know when he is returning to Australia. But this Bill is going through the Senate in his absence. Whether or not he would have voted against the Government that he supports I do not know. He is having the better part of both worlds by telling a committee that he does not support the Bill and retaining his pair in respect of it so that he can say that he could not vote because he was paired. I believe that he should have released his pair. So today we have another instance of this chamber nullifying its existence by becoming a parties House instead of a States House.
People may say: “ What does it matter to Tasmania? Only 2 million lb. of peas have been imported from New Zealand compared with the Australian consumption of 57 million lb.” But the whole point is that there is no quantitative restriction in regard to peas as there is in regard to cheese and pig meats. Why isn’t there? Has the Government given any answer to that question? I hops that the Minister for Customs and Excise (Senator Anderson), when he replies to this debate, will tell us why there arc no quantitative restrictions in regard to peas whereas quantitative restrictions in regard to cheese and pig meats are included in the Bill. We are told that, after all. only 2 million lb. are involved. That is the argument that has been advanced by several members of the Government parties. They say that it is only a drop in the ocean or one pea in the pool. Nevertheless, the moment this Bill is passed, the New Zealand industry will be so geared that its imports into Australia will rise rapidly with each succeeding year. It has been noticed already that the cheese industry-
– What about the local production of peas and beans? lt will find a ready market even in competition with imported peas and beans, will it not?
– I do not know. There may be some technical factor, of which I have no knowledge, in regard to the “ Surprise “ peas which may make them better peas.
– There will be fluctuations in the supply of the New Zealand product because of seasonal conditions.
– There may be. The point that I was trying to make was that, although at the moment imports amount to only 2 million lb. in a total consumption of 57 million lb., the moment this
Bill is passed the New Zealanders will start to increase the amount that they export to Australia, to the detriment of Tasmania.
– Why include these provisions otherwise?
– -That is right. If anything in this measure is to the detriment of Tasmania, one would expect Tasmanian senators to stand up in this chamber, which is a States House, and vote against it. Yet we do not see that. We see this complacency and this attitude which says: “ We have the numbers.”
The DEPUTY PRESIDENT (Senator Drake-Brockman). - Order! The honorable senator is not allowed to bring personalities into the debate.
– I did not refer to any one person. It was a generalisation. 1 must say that 1 did mention two honorable senators by name earlier, but you did not call me to order then, Mr. Deputy President. Tasmanian senators are falling down on their duty in regard to this matter. I do not know whether that is a personal reflection on them. I hope that it is a personal reflection.
– That is assuming that the honorable senator’s case is proved.
– That is right.
The DEPUTY PRESIDENT. - The honorable senator must not make a personal reflection on another senator.
-] apologise if I made a personal attack on anyone. The point is that until time passes we just do not know whether our case will be proved or not; but with the passing of time the industry in Tasmania will go backwards and the industry in New Zealand will go forward. Then, of course, it will be too late. The period of two years to which Senator Wright referred is something that I hope we can grab hold of. Nevertheless, at the end of that period the New Zealanders will have already geared their industry to supplying the Australian market and I believe that they will be too powerful.
Surely honorable senators who are interested in agriculture realise that we are being sold down the river for the benefit of secondary industry. The Government says that it is far better to sell our heavy industrial goods and to let our agricultural commodities suffer. If it continues with this attitude, we in Tasmania will suffer from a lack of industries setting up in our State. Senator Wright expressed the hope that the Unilever organisation would consider setting up a factory in Australia. He said that he hoped the factory would be set up in Tasmania. It certainly will not be, because the organisation’s freight rates from New Zealand to its proposed markets are so cheap that it will stay where it is. We also know that already the growers in Tasmania are threatened with a reduction in prices. Apparently the fact that a large industry in Tasmania will suffer means nothing to Tasmanian senators.
An important point in Senator Wright’s speech was that the amount of peas coming into Australia was insignificant up to date. I think the words “ up to date “ should be underlined. The moment that this Bill goes through, the New Zealand producers will swamp the Australian market. Admittedly, the Australian producers have certain protection, but it is always too late after the event. I hope that Tasmanian senators will come to the aid of their State on this occasion and prove that the Senate is a States House and not a party House by voting for the amendment.
– After hearing Senator Turnbull’s speech 1 think it is quite in place to remind the Senate that this is a House of review in the National Parliament, considering a trade treaty between Australia and New Zealand. For certain reasons, some aspects of the trade treaty have come into prominence. I oiler no criticism of that. We who come from Tasmania have known ever since August last of the concern of Tasmanian primary producers at the possible effect of the trade treaty when it comes into operation. I will not answer the cheap sneers of Senator Turnbull. I know him too well not to expect that.
The DEPUTY PRESIDENT. - Order!
– However, I wish to explain my position in the Senate in respect to the New Zealand-Australia Free Trade Agreement. Two Governments and their advisers have given long and serious consideration to the idea of developing a free trade area in this part of the world. I am convinced, and I believe that every honorable senator is convinced, that our geographical situation means that we have to live closely to and develop with New Zealand, just as New Zealand must live closely to and develop with us. I am not prepared to believe that this trade treaty which will be of great good to both countries should be abrogated - to use the word chosen by the Minister for Trade and Industry (Mr. McEwen) - for what may or may not happen to a particular industry in five or six years time.
When I was in New Zealand in November and December last I discussed all aspects of the Agreement from the point of view of primary producers. I had discussions with processors, members of the New Zealand Parliament and other business people. In the full knowledge that what I say will be forever recorded in “ Hansard “, I state that I do not believe it is the wish, will or intention of New Zealand primary producers so to expand their growing and processing of peas and beans as to interfere adversely with the market of Australian producers. New Zealand primary producers want to live, just as our primary producers do. New Zealand producers have sufficient land available to devote to the growing of peas and beans and other vegetables for freezing and export in quantities adequate to swamp the Australian market. But they wish to grow other products on their land. They have other uses for their land. They know what suits the New Zealand economy, their wishes and abilities. I do not support the fear that Senator Turnbull tried to raise, that once this legislation is passed, New Zealand production will increase so that the Australian market will be swamped. I do not believe that to be the intention of the New Zealand producers.
New Zealand primary producers and other New Zealanders have realised that some sections of their community will be adversely affected by this trade treaty. Whenever two governments of countries with similar basic primary industries and some mineral deposits, relying chiefly on exports of primary products, negotiate a trade treaty, some sections of the community must give what the other sections take. That applies to Australia and New Zealand on each side of the Tasman Sea.
It may have been my fault that I did not speak in the debate on the New ZealandAustralia Free Trade Agreement in the
Senate. I will not take advantage of honorable senators by stating now my views on why the Agreement has been well negotiated and all its aspects faithfully studied and placed before us in the form of a Customs Bill for ratification so that it may be put into operation. But I want it known that I do not believe that any Tasmanian senator, or any honorable senator, should vote against the Agreement because one section of the electors of his State believes that in some years ahead it will have its industry injured, in spite of the known safeguards. I do not say it cynically. I believe that the matter should be studied from the national viewpoint, both here and in New Zealand. I shall listen with interest to the debate on the proposed amendments, particularly the amendment foreshadowed by Senator Wright.
I am voting for the second reading of this measure, because I believe it is worthwhile. It will be of great benefit and I do not go along with the people who say that Tasmanian producers of peas and beans will be seriously hurt. Figures have been cited to show that we need imports of peas at present to feed the Australian people who want to eat them. As production increases, so will the consumption of peas rise in this developing country. Growers and processors agree that peas which are popular on the market should be available. I believe that Australians will prefer the Australian product. In Australia today we need an upsurge of loyalty to the principle of “ made in Australia “, rather than the introduction of legislation to safeguard one section of primary production completely to the detriment of somebody else.
– Some of the imported peas are not labelled “ Australian “. They are not labelled at all. The “ Surprise “ pea packages show no country of origin.
– I have heard reference to that aspect. I believe that the Department of Trade and Industry or the Department of Customs and Excise should be able to stipulate that imports for consumption in Australia are branded with the country of origin. The “ Surprise “ peas come to Australia and are repackaged. I am not an expert on “ Surprise “ peas, but 1 believe that if they were really proving to be an economical export from New Zealand, the Unilever organisation would allow the peas that are processed in Australia to be processed by that means. I understand that the patent for the processing of “ Surprise “ peas is held by Unilever (Australia) Pty. Ltd. and that it is not proving to be an economic proposition, against that company’s greatest hopes of success. If it were a success, I believe that Australian peas would be processed in the same manner. I do not mind going on record as saying that the Tasmanian grower of peas and beans has not a lot to fear from the “ Surprise “ pea that one hears so much about and which, one must admit, is a very good product when served at the table. I will consider any amendment that may be moved in respect of frozen peas and beans but I say steadfastly that I will not vote to reject this Agreement just because one of its provisions may prove detrimental to some vegetable growers in some areas at some time.
.- I shall be brief in dealing with this measure. The Bill covers, among other things, the ratification or confirmation of duties imposed under the New Zealand-Australia Free Trade Agreement. It covers many commodities, but the main matter that seems to have been discussed so far during the debate is that part of the Agreement affecting beans and peas. I believe this Agreement, as a whole, is good and will turn out to be a very good thing for Australia. A great deal of change is taking place in the world in the circumstances relating to trade. The establishment of the European Common Market and other events of that type will change the whole outlook on world trade in the not too distant future.
This is an Agreement to cover 60 per cent, of our trade with New Zealand, but four items in particular have been dealt with since it was negotiated. They are beans, peas, cheese and pig meats. Some beans and peas - not a lot, I know - are grown in Queensland, and a spokesman for the industry in the Gympie district - the main bean and pea growing district in that State - has given full support to this Agreement. He has stated that the growers there realise that they are adequately protected under the safeguards contained in the Agreement.
I point out, as has been mentioned many times before during the debate, that the duty on imported beans and peas is imposed only when the f.o.b. price is below ls. 10id. per lb., and is lo be phased out over eight years - not straight away, tomorrow or later this year. In fact, there is to be no reduction at all in the duty during 1966. In 1967 and 1968 the duty on imports of beans and peas will be 80 per cent, of today’s rates. That is not a great reduction. In 1969 and 1970 the duty will be 60 per cent, of what it is today, when the price falls below the f.o.b. rate of ls. l0½d. per Ib. I think the fact that any really substantial reduction in the duty is that far ahead will give the industry time to see where it is going and will enable any safeguards to be invoked. I think this Bill should be agreed to as it stands.
I want to refer lo cheddar cheese, which is covered by the Agreement and which has been mentioned during this debate. I believe Australia has a good deal with New Zealand in that part of the Agreement which covers cheddar cheese. Previously New Zealand could send as much cheese as it liked into Australia on payment of a duty of 6d. per lb., but now there are to be quantity restrictions on the importation of New Zealand cheese into Australia while no quantity restrictions whatever arc to be placed on the exports of Australian cheese to New Zealand. We could not export cheese to New Zealand before because of exchange control, but now we can do so by right. That is written into the treaty. Previously this trade was covered only by a time to time agreement. Australia is already sending some cheese to New Zealand. That part of the Agreement relating to cheese will turn out to be of great benefit to us.
Turning now to pig meats, I want to draw attention to the fact that the production of pig meats is generally associated with the dairy industry, although that is not the case in some parts of Australia, where the pig meat producers are right on their own and are not allied in any way with dairying. They are producing pig meats separately, from grain and other products. Their production is not related to dairying at all and cannot be tied to the dairy industry. As we know, no pig meat has been imported into Australia from New Zealand for some years and it does not seem likely that any will be imported for a while. The Agreement provides for 3,000 tons of pork to be admitted annually from New Zealand duty free, and the duty on hams and bacon is to be removed also. The conditions attached to the importation of pork have already been mentioned. I would like to point out that Australia’s consumption of pork is 14 lb. per head per year and its consumption of bacon and ham is 7 lb. per head per year. Our population is increasing by approximately 220,000 per year. The increased population will consume very large additional amounts of pork, bacon and ham each year, amounting to 1,300 tons of pork and 650 tons of bacon and ham. The increase in population will absorb the increased imports under the New ZealandAustralia Free Trade Agreement. There is another thing, apart from the duty, which has not been stressed. When comparing our prices with those in New Zealand account must be taken of the exchange rate, under which £A5 or SA10 equals £NZ4. This reacts greatly to the benefit of the Australian exporter to New Zealand and provides some measure of protection, apart from any duty on imports from that country.
There is another important matter in this Agreement, although naturally it is not mentioned in this Bill. I refer to raw sugar, which is important, to Queensland and northern New South Wales, and in relation to which we are amply protected under this Agreement. It is written into the Agreement that there is to be no change in the duty on raw sugar. Raw sugar goes into New Zealand from Australia duty free at the present time, and we now have it written into the Agreement that this will continue. I might mention that after raw sugar is refined in New Zealand a small revenue duty or sales tax of about id. per lb. is imposed by the New Zealand Government. We have this protection, and it is something which should be taken into account in considering this measure as a whole and in considering the Agreement as a whole.
I want to repeat something which has already been said with regard to Australian and New Zealand trade. It has been argued that the Agreement will benefit heavy industries such as those which export motor cars and other manufactured goods to New Zealand, but that it will act to the detriment of Australian primary producers. I consider that that is not the case. The Agreement will provide more employment in Australia and this will mean more population. The increase in population will increase the best market of all for the Australian primary producers - the home market. I think the Agreement deserves support for that reason. I appeal to the Senate not to do anything to nullify the effect of the Agreement, but to pass these tariff schedules in their present form and to give the Agreement a chance to work so that we can see what its affect will be. There was considerable opposition to the Japanese Trade Agreement, but the position in relation to that Agreement is totally different from what was forecast by ils critics, lt has proved successful and has done much for Australia. Australia and New Zealand, two nations of European stock, have to get together and trade with one another.
Sitting suspended from 6 to 8 p.m.
– When the sitting was suspended 1 was about to deal with the question of how the Common Market would affect the New Zealand-Australia Free Trade Agreement and wilh the possibility of the United Kingdom entering the Common Market. Whether or not the United Kingdom enters the Common Market, other similar market arrangements will develop and will affect trade generally between various countries. Australia and New Zealand know where they stand in relation to the Agreement which is the subject of the Bill we are discussing.
Australia and New Zealand are two predominantly European nations right out on their own in the South Pacific. New Zealand was nearly a part of our Federation at one time. There is the famous saying that there were 1,200 reasons why New Zealand was nearly a part of our Federation a mile long. Under changed conditions today, I think that those same 1,200 reasons have to be considered when dealing with this Agreement. They are very solid reasons why it should be supported unanimously. Australia wants overseas trade. We must expand our industries and we must increase our population. We want more home markets for primary produce and we want to develop this country as quickly as possible. We want more trade agreements. Therefore I suggest that the Senate should support the measure without amendment.
– 1 have listened with great interest to the debate on this Bill and also on the New Zealand-Australia Free Trade Agreement. I have read the speeches made in another place on the same matters. 1 have come to the conclusion that there is no disputation on the desirability of and necessity for a trade agreement between Australia and our sister dominion New Zealand. We all agree that it is very desirable and necessary that our trade and that of our sister dominion should be as free as is practicable, having regard to the respective circumstances of each country. I believe that the present time, when the world is torn asunder and when so much division exists between countries, is a very propitious time for the members of the family to come closer together because unless we live as a good family we will fall one by one.
Having agreed that the Agreement is desirable, we come to the question of its details. No two parties have ever succeeded in signing an agreement unless both were prepared to concede something. No agreement has ever been reached if one party has taken up a stubborn attitude and was not prepared to give away something. An agreement, whether it be a trade agreement or any other agreement, can only be reached if it is based on understanding of the other fellow’s difficulties. Consultations and negotiations on this Agreement have taken place for two years. 1 believe that it is the result of a very sincere and conscientious desire on the part of Australia and New Zealand to arrive at a result which will be of mutual advantage, as far as is humanly possible, under existing circumstances.
As I said at the outset, I have listened with a great deal of interest to the debate that has taken place. I can appreciate the argument of those who are sincerely concerned with the position of the pea and bean growers in Tasmania. None of us here would want to retard development or to stint our praise of the work of primary producers in Tasmania. But 1 must admit that as yet I have not heard any real evidence that an Australian industry is suffering or is likely to suffer in the immediate future as a result of the Agreement that has been signed between Australia and New Zealand. I think that there is premature apprehension on the part of some people. 1 suppose it is natural for people to be apprehensive when they are not sure what is going to happen, but surely even the most apprehensive of people must have some confidence in those who have negotiated the Agreement on behalf of Australia.
Indeed, the Agreement contains provisions for protection in the event of an industry being threatened with injury or destruction. If people in an industry feel that injury or destruction will occur, there is nothing to prevent them from constituting a panel from the industry concerned, consulting the Department of Trade and Industry and bringing before the departmental officers the ill effects of the Agreement so that a remedy may be devised. If I had had any doubt as to how I would vote on this issue, Senator Wright would have removed it. As a representative of the Stale that is likely to be affected, he made an excellent contribution to the debate. It showed that he probably had given the matter a great deal more consideration and had subjected it to more analysis than any other speaker who contributed to the debate. For that reason I did not appreciate the remarks of Senator Turnbull when he referred to Senator Wright.
– They were typical.
– I am not concerned with Senator Turnbull’s habits with regard to debates. Knowing Senator Wright, I am satisfied that if he had believed there was evidence that the pea and bean industry in Tasmania was to be injured as a result of this Agreement, he would have been just as staunch in support of that industry as he was, according to Senator Turnbull, in support of the berry fruit industry in Tasmania. I am not tied to any party machine. I have listened to this debate with an open mind to be informed and to learn the pros and cons of the matter. I say very deliberately that so far I have not had any evidence given to me that this Agreement is likely now, or in the immediate future anyway, to affect adversely any industry in Australia. If I had believed, or had been supplied with evidence, that any industry was in imminent danger, you would have found me, Mr. President, on the side of that State and of that industry.
Senator Turnbull made great play of the fact that this Senate was a States House and not a party House. Well, let us all subscribe to that view. Let it not be only the idea of a few. Do not lel this be a States House when it is politically popular to be on the side of a State. It is very easy to be on the bandwagon and to get on to the popular side of things. But not all of us are expected by the people who elect us to be political sycophants of one industry or another merely for political gain. They expect us to be capable of analysing the pros and cons of a case. They do not expect us just to go along voting for one thing or another merely because of the political gain that can bc obtained from taking that course.
I would like to say, Mr. President - and I say this with all the sincerity at my disposal - that the speech by Senator Wright here this afternoon on this case was a complete and proper analysis of the New Zealand-Australia Free Trade Agreement and its effects on and advantages to Australia and New Zealand. If he in conscience believes after a proper analysis of the case that Australia and the pea and bean growers in Tasmania are not suffering and are not likely to suffer any material disadvantage as a result of the Agreement, is he required, merely on a State basis, to vote against the legislation that is before the Senate now? Of course not. As one who is free in conscience and in speech in this Senate, I commend Senator Wright. I believe that the pea and bean growers of Tasmania, when they read his speech and examine what he has to say, will commend the honorable senator and his colleague, Senator Marriott, for having the courage to support what they believe to be right irrespective of what the political repercussion might be. After all, it is one thing to be a States House. It is another thing for an honorable senator to vote according to his conscience and what he believes to be right. In this case, if I be pardoned for repeating myself, I have not heard any evidence that any imminent danger exists to any industry whether it be pig meats, beans and peas, or cheese.
I have examined the Agreement and the Bill that we are discussing now. I was reminded somewhat of line in the poem “ ‘ We’ll all be rooned ‘, said Hanrahan.” It continues to this effect: “ ‘ If it rains, we’ll have floods. If it does not rain, we will have bushfires. In any case we’ll all be rooned. “ Do not let us anticipate the difficulties. Those who are likely to suffer any difficulties can take comfort, I am sure, in the knowledge that the Agreement contains provisions for some action to be taken in the event of their industry being adversely affected. Surely between two sister dominions, some further agreement can be made before destruction has taken place. Senator Lawrie made a good point. I think it was the first time that I had heard it in the debate. He said that the tariffs were not to be summarily dismissed with a sweep of the hand; there is to be a gradual reduction. This is a good point indeed. It shows that mature consideration and thought have been given to this matter. A limitation on the import of pig meats, and cheese has been included in the Agreement also. I think the pea and bean growers of Tasmania would be well advised to accept the advice and the counsel of the Minister for Trade and Industry (Mr. McEwen) and set up their panel.
– They did that in 1963 and it did not work.
– Well, they should try it again. The honorable senator remembers the story of Robert Bruce.
– We have heard all those stories.
– These growers should get into consultation with the Department of Trade and Industry.
– But the spiders are not so obliging these days.
– The growers have been doing this since last July.
– We have heard these cries of gloom and doom in regard to agreements that have been produced at other times. We heard all these cries of calamity and doom when an agreement was made between Australia and Japan. What have those people who forecast that we were doomed to hand this country over to Japan to say about the matter today? Many of them will deny that they ever took part in the cries of calamity. Let us be realistic in our approach to this question. As I said at the outset, we are all agreed, are we not, that we should have a trade agreement with our sister dominion, New Zealand, lt should be based on the principle of mutual benefit to the best and most practical extent that we can get it. It is a very natural thing in a family to do that. New Zealand is a great customer of Australia. Do not let us destroy this Agreement because of our premature apprehension that one industry might be adversely affected to some small extent. Beyond that, no evidence has been adduced that there are likely to be any ill effects as a result of this Agreement.
For those reasons, my colleague and I are satisfied that the Agreement will serve both countries advantageously. I think it will prove to be of great benefit to both Australia and New Zealand. I am satisfied that, if the pea and bean growers of Tasmania find that the Agreement adversely affects their industry, as a result of prompt advice and consultation with the heads of the Department of Trade and Industry remedies will be applied to save the industry.
– When the New Zealand-Australia Free Trade Agreement was under consideration by the Senate on the 21st April, I spoke at very great length and dealt with the four points of objection and the four commodities to which Senator O’Byrne and other colleagues have addressed themselves today. I shall not repeat what I said on that occasion, but 1 do not retract anything that I then said. I have very little to add at this stage. I make it quite clear that we of the Australian Labour Party do not oppose the New ZealandAustralia Free Trade Agreement. We never have opposed it on any occasion. We realise that it serves a national purpose. We realise that it serves a worthy international purpose. I agree with what Senator Gair said about the need to free the trade of the world and to build better relations. The Agreement plays a proper part in that respect.
We do not oppose the second reading of this Bill. We have said nothing that would indicate that we shall do so. The Bill serves many purposes other than the implementation of the Agreement in relation to duties. We confine our oppositon to those items in the proposed changes in the Tariff that deal with cheese, pig meats, beans and peas. They are the four things to which we direct our opposition. We direct our opposition to them and to them atone. We oppose both the gradual reduction of duties on those items, particularly beans and peas, and the ultimate abolition of the duties. In the view that I put, four things are tied up with the one industry, particularly on the north west coast of Tasmania. The dairy industry is the central factor in the economy of this area. The production of cheese and pig meats and the growing of beans and peas are offshoots of that industry and are intimately tied up with it. Almost the whole economy of the north west coast revolves around the agricultural industry. A series of decentralised activities function in this area. Any disruption of the existing situation would be serious for the whole area and for the policy of decentralisation which operates there.
I now wish to mention two big factors which I think have not been adequately stressed in this debate. The effect of the New Zealand-Australia Free Trade Agreement on this area will be, first, to halt all possibility of development and expansion. Because of the uncertainty of developments in relation to the four commodities in question, any plans for expansion that the processors on the north west coast had will most certainly be deferred indefinitely if not dropped altogether. They certainly will be postponed. There, at this very minute, is the first hurt. Unless the processors of beans and peas arc prepared to expand their plant and activities, they cannot let further contracts to the growers. Who would be prepared to expand in these uncertain conditions? The result is that the grower cannot think of expansion. In this field, as in every other field, there can be no standing still; one either goes on and expands or falls back and loses one’s place in the race. There immediately is the first real and vital hurt to this industry - the fact that all expansion and development is halted. It will take time to generate momentum again.
The second factor - it lies at the very base of the fears of the growers on the north west coast - is that with an expected large influx of frozen peas and dehydrated peas - the latter being a new factor which could be a dominating element in this situation - there is the danger of lowered prices being paid to the growers. This is not a baseless fear. The officials of the Canning Pea Growers Association have informed me personally that they were present when the manager of one of the processing firms on the north west coast read to them an extract from a letter from its headquarters on the mainland instructing it to look forward to a reduction in the price to be paid to the growers of peas.
– What was the basis of their fear?
– That was expressed in the letter, too. lt was stated to bc because of the initiation of the New Zealand-Australia Free Trade Agreement. Reference was made to the changes that were to be expected in relation to their own commodity in Australia, particularly on the north west coast of Tasmania. That was put in writing, and it was read by the manager of a local concern to the officials of the Canning Pea Growers Association. So it is not a baseless fear. We have those two major elements, the first being the halting of expansion and development. That is bad enough, and it is being experienced now. The other element is the outlook of the processors as conveyed to the Canning Pea Growers Association - that is, that a lowering of prices to the grower is in mind. Not much can be done about it for the next year’s crop. The contracts have been let and the prices have been fixed for the crop for this year and next year.
Depending upon quality and the right time for picking and so forth, the growers get an average of 5id. per lb. for their product. Out of that they pay their pickers and other expenses. So the return to the growers is not magnificent. Their product retails ultimately at about 2s. per lb., or more. I think the 10 oz. pack is sold for 2s. The only way in which the growers have been able to make their activity pay has been to improve their husbandry - to learn the art of growing peas and beans. The result has been that they have almost doubled the production they can get from an acre of land. Here is an efficient industry which in 10 years has grown from practically nothing to one which is supplying 60 per cent, of the needs of the nation in regard to peas and 35 per cent, of its needs in regard to beans. This young and developing industry which gives hope and a steady income. but which is dependent upon weather conditions and the vagaries of markets, is being attacked on four fronts in one area - in relation to pig meats, cheese, beans and peas. As I put it to the Senate and as I see it, those fears are not unreasoning fears. They are well based. They are inescapable facts that development and expansion are now halted. That goes for both grower and processor.
The move towards lower prices to the growers is already under way, and I invite the Senate to remember, as proof of the efficiency of this industry, that there has been no price increase over a five years period. Increasing costs have been picked up by the industry over that period. It cannot be said against those growers that they are inefficient. They are exceedingly efficient and they are moving with the times. It is no answer to those men who are concerned with the realities of the situation for the Minister or for any honorable senator to tell them that their fears are groundless. Their fears are facts. It is difficult to assess the position. I suggest that we cannot with reason assess the effect of this new Agreement upon the growers on the north west coast by pointing to what happened in the past. Nor is it any argument to point out what is happening in the matter of exports from New Zealand to Australia of the commodities at issue today. We do face a difficulty when we come to consider the future, and we just have to make as informed a judgment as we possibly can. One can only put oneself in the position of a grower on that north west coast. He sees the new development, the “ Surprise “ pea, the dehydrated pea, which has come out here in very small quantities indeed. I think it was said today that the quantity was some 8.000 lb. Senator Henty told us on 5th October last year that he had had a letter from the Unilever people, who produce the “ Surprise “ peas, in these terms, amongst others -
To assess the possibilities we need local information both from the marketing and technical aspects, and it is entirely to gain the required marketing knowledge that we are importing peas from New Zealand.
I take it that they are the “ Surprise “ peas. The letter goes on to say -
Our present operation in importing peas from New Zealand is unprofitable . . .
The important words in that passage are “ Our present operation “. They are the three important words. And, of course, when the organisation in New Zealand is testing the market, the whole of that operation is completely overridden with administrative and advertising costs out of all proportion to what they would be if the peas were coming on the market in large quantities.
They were very careful to point out that this was a trial run and that it was not profitable. Nobody would expect it to be. Those people concerned on the north west coast are dealing with frozen peas, bulky articles, taking up a large packet and involving refrigeration. They are far more bulky to transport than dehydrated peas, which in bulk and weight are reduced by four-fifths, with all of the advantage that that gives in freight, and with all of the vast advantage that it gives in the lack of need for refrigeration, in sending it over from New Zealand, in the shops, and on the shelf in the housewife’s cupboard. From the viewpoint of convenience, the housewife going into the store to buy will have a choice. There will be a 10 oz. packet of frozen peas in their bulky condition, dripping wilh powdered ice, wet and having to be stored immediately, as they lose their efficiency and virtue if they are really defrosted. Against that we get this dry small packet, that weighs 2 oz. the contents, after being put into water and cooked, come in the most delectable form, I am told, on to the table with the full weight of 10 oz. after taking up water. There is a threat to the whole industry.
– Why is it a threat?
– First, because this product is protected by a patent, which is not available to those people on the north west coast.
– Unless Unilever starts production.
– Unless Unilever itself starts there. Let us be realistic. We started off with canned peas. We moved on to frozen peas in the evolution of this industry it seems inevitable that this new pea, the completely dehydrated one that is produced with expensive machinery, will be the article that will win. Anybody who thinks that the fears of the growers as to what might happen in future are groundless is not being fair to them. They are really fearful and anybody who has met them knows that. The suggestion put by Senator Wright - I hope I put it accurately - is that this process of duty might be given effect to for a period of two years, that it should be delimited for two years. In all the circumstances that I have put, I suggest to the honorable senator that his purpose would be better achieved if we were to strike out these items at the present time. There is provision in the Agreement for reinserting them. I think that we would lack wisdom in this Senate and we would be unfair to the growers on the north west coast if we did not take that step. If we do take these items out. we do not conclude the matter.
I remind the Senate that I dealt at length with this Agreement on 21st April. I took it. I think, clause by clause and discussed it. May I remind the Senate that in Article 3, paragraph 2, this Agreement is expressed to apply to all goods traded within the area. The clause goes on to provide that the parties shall confer from time to time with a view to the inclusion in the Agreement of items not yet included. That is a process to go on all the time. Let us take these items out, and in two years when we know whether the fears are real or not real, when we have seen whether or not the expected development that I have projected of the “ Surprise “ pea has taken place, we can look at the two years operations and, if the fears have proved to the groundless, we can put the items in again. It is much better to do this now that to start on the process of eliminating the duty. It will be very difficult once the whole process of abolition over a period of eight years from 1st January has started. It will not be easy to halt it. I think that anybody who looks at this objectively will agree. Everybody who has spoken has addressed himself objectively to the matter. Speeches have been to the point and they have been concise. I have no doubt at all that they have been completely sincere. Would not the result be better achieved in that way, when the Agreement itself provides that items can go in, in the light of the argument that I have addressed to the Senate and the welt based fears of the growers on the north west coast?
A slight adaptation of Senator Wright’s proposal would be to take the items out and then watch the proceedings for two years. The next two years will be the critical period, the period in which any damage that is to be done will show its head. Then, if we find that the fears are baseless, let us review the position in two years and see about putting the items back in. That is caution, that is wisdom, and it is acknowledging the fact that these people have fears. That is a fact that has to be faced. One can say that they are groundless or that he thinks they are, but anybody who has met these growers knows how exceedingly unhappy they are and how exceedingly and sincerely disturbed they are. The whole of their plans for the future are affected. The whole of their husbandry - the rotation of their crops and so on - is affected. They have come through a tough time. They had a tough time with potatoes, but they have weaned themselves from potatoes and have found their salvation in the growing of peas and beans.
I hope that the Senate will give due consideration to the argument that I address to it. I am advocating a policy of wait and see rather than one of go ahead. If we hit a brick wall, let us then turn back. I do not want to hit the brick wall. The position today in relation to peas and beans is exceedingly fluid. All of us can exercise a judgment in the matter. Some may say: “ It will do no harm “, while others may say: “ It will do vast harm “. Neither side knows the truth. Why not wait and see for a two year period? The duties having been running for a very considerable period.
I conclude my remarks with those comments. While applauding, as we all do, the general purpose of the New ZealandAustralia Free Trade Agreement, I am hopeful that when we reach the Committee stage we will look at the plight of this young and growing industry - an industry with possibilities of expansion that at present is in fear, and, as I have argued, in well justified fear.
– in reply - Apart from the remarks which I shall now make, the second reading debate on Customs Tariff Bill (No. 2) has concluded. It is clear that the Senate will give speedy agreement to the motion for the second reading of the Bill. It is equally clear that in the Committee stage amendments will be moved by the Opposition. These have now been circulated. Senator Wright also has circulated a proposed amendment. The Bill does three main things which I think we should reflect upon. First of all, it clarifies the position relating to motor car parts imported and incorporated as sets; it deals with concentrates - for example, concentrated juices - and it provides that the relevant powers should be part of the Customs Tariff because it is more appropriate that they should be dealt with in that way. Secondly, the Bill proposes to give validity and force to the proposals relating to tariffs contained in the New Zealand-Australia Free Trade Agreement. Thirdly, it provides the legislative form for the various Tariff Proposals - some 12 in all - which have been put before the Parliament pursuant to determinations by the Tariff Board and the Special Advisory Authority and acceptance or variation by the Government of those determinations. So it is clear that this is a very substantial and important piece of legislation.
The debate has been virtually upon only one of all of the contemplated tariff changes. Here we have a Bill containing 13 schedules which deal with between 670 and 675 items of the Tariff, yet the debate this afternoon and this evening has revolved around virtually one item, peas and beans. I suggest to the Senate that that represents a tremendous compliment to the Department of Trade and Industry on the one hand, and to the Minister for Trade and Industry (Mr. McEwen) on the other hand. In the negotiations associated with the Trade Agreement the Minister had to advise the Government on proposals involving very many items of the Tariff. As I have said, nevertheless the debate has been confined to a single item, peas and beans, although I acknowledge that there are ten proposed amendments. This is, I repeat, a great compliment to the administrative ability and leadership of the Minister for Trade and Industry.
Listening to the debate, and particularly to Senator O’Byrne, who led for the Opposition, and to Senator Devitt, one could be excused for thinking that this Bill was designed to phase an industry out of existence. Of course, that is nonsense. The only proposal so far as any phasing out is concerned is to phase out certain duties over a period of years, lt is the intention and the spirit of the Agreement that there should be reasonable protection not only for industries in Australia but also for industries in New Zealand. As Senator Gair very properly said, you cannot even begin to negotiate a trade agreement unless both parties come to the conference table prepared to trade - to concede something and to try to get something, but at all times making sure that they protect their countries’ interests.
No one should suggest - the Opposition does not suggest it directly but it does so indirectly by the argument it propounds - that the Minister for Trade and Industry or the Australian Government would allow a trade agreement to be concluded which would do injury to the Australian people and Australian industry. We live in a world of politics, and the realities, of politics would suggest the absurdity of that proposition. But we must recognise that we are a trading nation and that we can never hope to live in complete isolation. We are trying to build up Australian trade because in the process of doing so we will provide a better way of life and more employment opportunities for the Australian people in a democratic society which we can be proud of and which we can pass on to those who come after us. Those things are inherent in any trade agreement.
Senator McKenna says that the Opposition does not object to the New ZealandAustralia Free Trade Agreement; but, when it comes to any proposition which, at some time in the future, may affect a certain part of Australia, he baulks and backs away from it.
– The Agreement has done that already.
– Senator Devitt keeps saying that the Agreement has done that already; but he had an opportunity to speak and he did not give one tittle of evidence of that. He uttered a lot of generalities and made no reference to the effect that the Agreement is having. He will have other opportunities to speak in the Committee stage. If he can give some evidence of the way in which the Agreement is affecting industry in Tasmania, he will have the opportuntiy to do so. I say with respect that in his speech in the second reading debate he did not give one item of evidence to that effect; he just repeated fears, fears and fears. That is a poor substitute for argument.
The Australian Government having negotiated this Agreement on the basis of good faith on both sides, it is not in the nature of things that the Government would countenance for one minute a trade agreement that would do injury to a very important part of the Australian economy. I know Tasmania and 1 know its people. The fear element is natural. But do honorable senators opposite imagine that the Government did not have a good and critical look at the Tasmanian position when it negotiated the Agreement?
– Of course, Senator Turnbull would suggest anything. This afternoon he suggested that we should abolish the Senate. Why he stays here I do not know. I do not know where his conscience is. The fact is that he is very rarely present, and when he is present he says that the Senate should be abolished. I suggest that he go away and not draw his salary.
The fact is that this Agreement, not only in its concept but also in its drafting, provides for the protection of people and also provides outlets which have been referred to in the Senate and which give strength and protection to people who have any fears in relation to any section of industry. The Agreement contains protection against dumping, lt contains provisions against the importation of goods the primary goods of which were dumped into New Zealand. It contains provisions for consultation. Under the Agreement, if, in the event of some circumstance or other, a group of people or an area of trade finds that it is being affected injuriously, vehicles are provided for bringing that to the notice of the Government and for the Government to adopt certain legal procedures in connection with the other party to the Agreement - New Zealand. So I say that these fears that have been developed in the debate so far are groundless.
I find it rather difficult to accept some of the things that were said here this afternoon and tonight. It is true that this is essentially a Committee bill. We will really get down to the merits and the facts when we deal with the various items in respect of which the Opposition has foreshadowed amendments. I believe that it would be unwise for me at this stage to canvass all the arguments that were advanced this afternoon about peas and beas. I am sure that 1 will have to do that in the Committee Stage. Therefore, I suggest that we leave the particular items until we go into Committee, when we will he able to deal with them more intimately.
I would like to make reference, as Senator Gair did, to Senator Wright’s speech. What Senator Wright said was quite analytical. He analysed the position of his own State of Tasmania. He came up with the view that, whilst there were fears ;n that State, they were not sustained, as he saw the situation, and therefore he would not support the Opposition’s amendment in relation to peas and beans. He said thai we should apply the phasing out provisions for only the first two year period, and then at the end of that period we could amend the Act and bring in a new tariff proposal in respect of the second stage of the phasing out. Then we could do the same in respect of the other stages until the duty was completely phased out. I say to him that that proposal indicates a lack of confidence In the very articles of the Agreement. In view of the fact that the Australian and New Zealand Governments have put Articles 7, 8, 9, 10 and so on into the Agreement to meet an emergency, if one arises, it would be completely inconsistent-
– Does the Minister think that the Agreement is perfect?
– I ask Senator O’Byrne to let me finish this statement. In view of that fact, it would be completely inconsistent with the Agreement to say that, despite the articles that have been included in the Agreement to protect the industry and despite the fact that the New Zealand and Australian Governments have reached complete understanding and have attached their signatures to the Agreement, we will go for only the first two year period and then we want the matter raised again. That proposition shows a certain fear of the future and a lack of confidence in the Agreement itself. As Senator Gair said, so far no evidence has been produced of any likelihood of danger, particularly in relation to the peas and beans, cheese, or pig meats industries.
Senator McKenna advanced an extraordinary proposition. To my mind, it is a completely spurious argument. He suggests that we have no reduction in duty at all for the first two years and test the system in that way. If we have no reduction in duty for the first two years, how can we test the system? lt seems to me that that is an extraordinary approach to the problem. 1 hope I am not misquoting the honorable senator. The fact is that the Agreement provides for a phased reduction of duty. Senator Wright says, in effect: “ I will go along with the phased reduction for the first two years; but let us pause at the end of that period and see whether we should go further.” Senator McKenna says, in effect: “ 1 would like to suggest a refinement of that proposition. My refinement is that WC test the system of duty reductions by not having any duty reductions at all.” How can the system be tested in that way? I would be interested to hear the honorable senator expound his proposition. In my opinion it is an extraordinary proposition.
I take comfort from the thought that we in this place are as one in saying that this Agreement should be ratified and implemented in tariff proposals. Some honorable senators have cause to express fears because people in their areas have fears. That is fair, enough. But I say that those fears are groundless and so far have not been substantiated. The Government looked at the Tasmanian position when it negotiated the Agreement, lt went to the trouble of writing into the Agreement certain safeguards for the protection of industries should any fears emerge in relation to any particular commodities.
– What about the advantages of these goods coming into Australia in small quantities?
– It is necessary to go back. The honorable senator is trying to look at this aspect in isolation. It has to be examined in the broad concept of an agreement. This Agreement covers hundreds of items and for that reason it is not feasible to take out one item and say: “ Look. New Zealand is not going to get very much and we are not going to lose very much. Therefore it should not go in.” On that basis an agreement could never be finalised.
Senator McKenna referred to Article 3. Now that the Agreement has been negotiated between Australia and New Zealand, it is hoped that eventually a completely free trade area can be established between the two nations. Senator Devitt singled out one item and stated that there was some question of the advantages to be gained on the one hand and of the inconvenience to be caused on the other. Therefore, he said, the item should be removed. If that argument were taken to its logical conclusion, there would be no Agreement left. The very basis of an agreement is to try to get included in it as many items as possible without undue injury to your own industries. It should be borne in mind that Australia is a developing country. This is relevant to the argument used by Senator McKenna. Australia is looking for opportunities for expansion and I suggest that Senator McKenna ‘s approach is very narrow in this respect. Australia is developing rapidly and it must follow, as night follows day, that production will increase. Is it suggested with any seriousness by Senator McKenna that because the New Zealand- Australia Free Trade Agreement has been negotiated and it contains an item relating to peas and beans that the farmers in the dairying industry in Tasmania will say: “ We will not grow any more peas and beans because those vegetables are included in the Agreement.”? That attitude pays the Tasmanian farmers a very poor compliment.
The primary producers of Australia do not sit down and bemoan their fate. They meet the situation. Primary production will have opportunities for expansion in step with Australia’s development. It is a completely false argument that simply because peas, beans, pig meats and cheese are included in the Agreement it will spell disaster for the dairying industry. 1 do not believe that the dairy farmers of Tasmania would have a bar of that argument. I have a tremendous admiration for Tasmanians, with a few notable exceptions. 1 admire their courage and ability. They will not give up the race simply because certain items have been included in the Agreement. They will face up to the situation and meet any challenge that arises. This Government, and any government, will always see to it that our primary producers are given opportunities to increase their production. I do not wish to be cross-examined in the debate on the second reading of the measure. I do not propose to be cross-examined. At the Committee stage of the debate we will deal with each item separately. All the arguments can then be put. Senator Turnbull and all honorable senators will have an opportunity to put their arguments and there will be an opportunity to answer them.
Motion (by Senator O’Byrne) proposed -
That consideration of the clauses of the Bill bc postponed until after consideration of the Schedules.
-(Senator DrakeBrockman) - Is it the wish of the Committee that the Schedules be considered before the clauses?
– I have before me a request for amendments circulated by Senator Wright. As I understand it, Senator Wright proposes to amend one of the clauses of the Bill. The motion now before the Committee is that consideration of the clauses be postponed until after consideration of the Schedules. The honorable senator has proposed amendments in the Schedules that are consequential upon his amending a clause. In fairness, I point out that if we by-pass the clauses and continue with the Schedules, and after wc have left the Schedules the honorable senator gets his amendment to a clause carried, he cannot go back to the Schedules except by a recommittal. 1 do not want any confusion to arise out of this procedure later.
.- 1 am much obliged to Senator McKenna for helping us to clarify the position. I find this Bill to be very complicated and difficult to handle. The view that I took in remaining acquiescent when Senator O’Byrne put his motion that the clauses be postponed until after consideration of the Schedules was that Labour’s proposed amendment was circulated first and I did not wish to intrude. If the majority in the Senate is prepared to go along with the Labour amendment to exclude from the Schedules the item relating to peas and beans, there will be no need to consider my amendment to a clause. My proposed amendment to Schedules is con fined to “ Surprise “ peas. After the Labour proposed amendment to exclude an item from the Schedules has been dealt with, if it is necessary I shall proceed with my proposed amendment in respect of “ Surprise “ peas. A vote can be taken then on my proposed amendment to a clause. I think that is a prefectly logical sequence in which to deal with it; that is to say, we should take the Labour proposed amendment to the Schedules, my proposed amendment to the Schedules, and then return to the clauses.
– I am quite happy to do that, so long as I have alerted the honorable senator.
– If I am in difficulties, I will trust to the discretion of honorable senators to assist me obtain leave to recommit the measure.
– If difficulty arises, we will help the honorable senator obtain leave for a recommittal.
– I point out to the Committee that the position would be exactly the opposite if we dealt with the clauses first.
Question resolved in the affirmative.
– Am I to understand that we are to deal with the amendments, including Senator Wright’s amendment, as they come in order, and return later in the clauses?
– Yes. We will lake the Schedules first and then come back to the clauses.
– We will proceed to the First Schedule. Is it the wish of the Committee that all the items in the Schedule be taken seriatum?
– The Schedules contain an enormous number of items. You have before you, Mr. Chairman, the proposed amendments circulated by the Opposition and by Senator Wright. Perhaps we could take those particular items and put the. intervening items together. It might save time.
– I have a suggestion to make. I have here a break up of the way we might be able to expedite consideration. It virtually follows the amendments as proposed.
Tariff Amendment 1.
.- I move -
That theHouse of Representatives be requested to make the following amendment, viz. -
Leave out sub-item 02.01.2.
This amendment relates to pig meat - to use the words of the sub-item, “ meat of swine, as prescribed by by-law “ - on which there is a prevailing duty of 25 cents per lb. There is provision in the fourth column of the Schedule to make imports of pig meat from New Zealand duty free. We oppose this provision because there is considerable concern among pig producers in various parts of Australia about its impact on their industry. It may be true, as has been said, that the Agreement has met with general approval of primary producers, but many of the provisions of the Agreement will not have any deleterious effects on the industries concerned. We believe that producers know their own industries. I think that in replying to the second reading debate the Minister for Customs and Excise (Senator Anderson) overlooked, as Senator Wright overlooked, that it is the right of persons who might be financially hurt and whose economic future is involved to bring the situation that faces them to the notice of members of the Parliament and of those responsible for drawing up these proposals. Senator Gair and Senator Anderson spoke of the fears of the primary producers. The Agreement is still under consideration here. It has never been ratified by the Senate.
– It does not require ratification by the Senate.
– It has not been fully discussed; it has been only partly discussed. It is an indication of the contempt in which the Senate is held by the Government that this legislation should come before us before the matter of the Agreement has been discussed and settled to the satisfaction of all honorable senators. It is still on the notice paper, and probably will stay there. That means that the Senate has not applied itself to the basic principles of the Agreement.
This legislation deals with over 500 tariff items, covering many commodities produced by Australia’s primary and secondary industries, but because we of the Opposition draw attention to a few of the items it is assumed that we are opposing the Agreement. That is a completely wrong approach on the part of the Minister. I asked the Minister by interjection whether he considered the Agreement to be perfect, but he would not answer my question. He knows very well that practically any agreement has imperfections. This Agreement has imperfections, and we are pressing forward with a series of amendments to draw attention to them. I think those imperfections are an indication that the Australian Minister and his advisers on the one hand, and the New Zealand Minister and his advisers on the other hand, took it upon themselves to reach the conclusions contained in the Agreement without prior close consultation with the industries concerned.
It has been claimed that the industries have been canvassed and that they have more or less signified agreement, but that is not so. People in the pig raising industry in various parts of Australia have expressed concern about the effects of the Agreement.
They do not fear any devastating effects such as might be possible in the pea and bean industry because of the new process being used in New Zealand, but they complain because their industry has been picked out for bargaining purposes under the Agreement without proper consultation. At present there is a duty of 3d. per lb. or 10 per cent., whichever is the lower, on pork. This will be phased out over two years. Figures have been quoted in support of the suggestion that the phasing out of this duty will have little impact on the Australian pig raising industry, but it must be borne in mind that there has been practically a ban on the importation of pig meat from New Zealand due to the occurrence of swine fever in that country. So those figures may be misleading. There are exceptional circumstances at present on account of the rearrangement of trading due to the occurrence of trichinosis in New Zealand.
There are people who specialise in the production of pig meats. In many parts of Australia this has become a specialist industry and the producers can be expected to adjust their techniques to meet whatever changes come about. But I point out that in Tasmania in particular much pig meat is produced in conjunction with dairy farming. Many people there use the old traditional form of pig raising. They rear young pigs on the by-products of the dairy, separated milk and the like. This activity has become an important part of the economy of the small farmer and he feels that it is being put into the melting pot. We must admit that in an agreement of this nature New Zealand’s gain must be Australia’s loss. The economists may try to show us that everyone will gain if the nation gains, but that is not true when it comes down to individuals.
Senator Wright__ It is quite possible that with more acute competition greater markets can occur.
– In the long run. That is a term that the economists often use. The economist takes the view that he is right if he balances the budget or makes an agreement, and that the primary producer is expendable if he does not fit in with his arrangements. This means that all the verbiage we hear about the freedom of the individual or a group of individuals is so much make believe.
– Where is the doctrine laid down that the economist takes the view that the primary producer is expendable?
– We were told this afternoon that when damage is done we can start to make complaints. Senator McKenna pointed out that this breaks down the confidence of an industry. Imports will be more freely admitted into Australia and we do not know what the impact will be. The people in the industries like to know their future prospects. They have to be able to make their plans. The arrangements which are proposed under this Agreement will allow greater competition from outside sources in addition to local competition. People engaged in primary industry believe that they may have to find some alternative means of livelihood. Instead of being able to continue to raise pigs as a sideline, they will have to look to some other source of income.
This amendment is the first of several amendments relating to pig meats, lt relates to pork. The other amendments relate to bacon and hams and to smoked pig meat.
– Could I interrupt the honorable senator to suggest that he might develop his argument in connection with the three pig meats but have separate votes on the amendments?
– I am developing my argument in relation to the whole of the pig meat industry, but I intend that there should be separate votes on the amendments. The same argument will apply to the other amendments concerning pig meats. As has happened with some of the other industries that have been mentioned this afternoon, this industry has been selected as one for bargaining. No compensating factor has been brought to bear in regard to this particular section of the community. The officers in the public relations section of the Department of Trade and Industry and those responsible for presenting to us this very comprehensive Agreement and this very comprehensive Bill have shown great ability in regard to the technical side of the Agreement and the Bill, but they have missed out on the human side. The men whose industry is specifically affected are the ones who are complaining. We will not be hurt. We will continue to carry out our duties here. The public servants will continue to carry out their duties. The Minister in New Zealand and the Minister in Australia who were responsible for the Agreement are carrying on with their jobs, but the men who are specifically affected by this section of the Agreement have had the balance of their economy disturbed to the extent that they cannot predict their future as. faithfully as they could before the Agreement came into operation.
– Order! The honorable senator’s time has expired.
– I rise merely to give Senator O’Byrne an opportunity to continue his remarks.
.- I thank the Minister, but that is all I wish to say. I have formally moved the amendment to omit sub-item 02.01.2.
.- I do not support the amendment. I was one of those who was approached by people in the pig meat industry when the New Zealand-Australia Free Trade Agreement was first mooted. Although they did not have any evidence, they said that they thought that the Agreement might be disadvantageous to them at some time in the future. I told them to go away and produce evidence. I said: “ When you can show me definite evidence that this is going to harm your industry to a degree and that action should be taken, you will have my vote.” Senator O’Byrne said that great resentment exists in the pig meat industry in regard to this Bill. I do not know where it is because the gentlemen who came to me and said they were so concerned have not come back. I have not had one representation from anybody in regard to the section of the Bill concerning the pig meat industry. 1 do not suppose that the people who raise pigs are any less concerned for their own interests than other people are. The people who are growing peas have put their case strongly and forthrightly, but I have not heard a word from the people who are connected with the pig meat industry and would be affected by this provision in the Bill. Therefore, as they, apparently, have not thought it necessary to take any action, 1 can only come to the conclusion that they are not greatly concerned.
I say in conclusion that 1 think the days are gone when any Australian food industry has to worry about its future. If one reads the reports of the Food and Agriculture Organisation of the United Nations and if one examines the predictions of the demographers as to the way in which the population of the world is expanding, the only conclusion to which one can come is that we in Australia will have one big problem in the future. It will be not how to dispose of the foodstuffs that we produce but how to produce enough. I gave an opportunity to those who saw me months ago about the pig meat question to produce evidence to me. I have not heard one word from them over the months. I can only conclude that they are not greatly disturbed about the Bill. Therefore, I shall oppose the amendment.
– As 1 understand the position, the argument advanced by Senator O’Byrne related primarily to the first proposed amendment, but he applied it to the second and third amendments as they also related to the pig meat industry. For that reason, I will reply to his argument, but I would like the Committee to appreciate that I am replying also to the three amendments. The Opposition’s case is based on the fact that the import of 3,000 tons of pig meat per year will, in fact, cause injury; by that I mean it will decrease local sales. As Senator O’Byrne has already indicated, pig meat has not been imported from New Zealand because a disease has affected the pigs in that country. I refer, of course, to the disease trichinosis. So, at the present time, there is no problem because there is no prospect of imports while this disease continues.
But the argument is used that it will not be necessary to restrict the importation of pig meats at some future time because the New Zealand industry may be able to put its house in order and that, therefore, the provisions of the Agreement would apply. In 1963-64 2,600 tons of pig meats were imported. This is only 400 tons short of the new proposed level. Australian production of pig meats in 1964-65 was 121,000 tons. I do not think it is valid to suggest that a problem would be presented to the industry if the bar on the importation of New Zealand pig meats was lifted, if and when the disease was controlled, and the quantity imported in 1963-64 was increased by 400 tons. This argument is not valid also when we bear in mind the significant factor of the natural increase in our production. I pointed out in my second reading speech that Australia’s production of pig meats rose by 10,000 tons between 1963-64 and 1964-65. I repeat that the annual production then stood at 121,000 tons. The local industry entertains a fear. I suggest that this fear is not well founded.
I come now to the most important of the three points I wish to bring out. This is that the concession is given by by-law administration. The purpose of granting this concession by by-law is to enable the provision to be turned on and turned off with great speed when circumstances justify this action. The by-law provision is that this concession will be available to processors only, and then available only to’ processors who with local producers have agreed to arrange imports in an orderly manner. Whilst I can understand that Senator O’Byrne, on behalf of the Opposition, has moved the three amendments in relation to pig meats as a result of representations made to it,I do not feel that the amendments have any strength at all. The amendments would have strength only if questions or problems arose with relation to the prohibition of imports.I am assured by the Minister for Health (Dr. Forbes) that the prohibition in force at the moment will be maintained until a belter day arrives for the New Zealand pig meats industry in relation to the disease now affecting it. Under the Agreement, the importation of pig meats per annum will be increased. An import level of 3,000 tons will be reached. If a greater tonnage than this is imported, the normal duty will have to be paid on it. For the reasons that I have outlined, the Government is not prepared to accept proposed amendments.
Question put -
That the House of Representatives be requested to amend the Bill by leaving out the words proposed to be left out (Senator O’Byrne’s request).
The Committee divided. (The Chairman - Senator T. C. Drake-Brock man . )
Majority . . . . 6
Question so resolved in the negative.
Tariff Amendment agreed to.
Tariff Amendment 2.
.- During the course of my remarks on proposed new sub-item 02.01.2, I covered the case in relation to the production of pig meats. I pointed out that we were opposed to the importation of pig meats from New Zealand being phased out over a period of two years and also to free entry. Therefore, I move -
That the House of Representatives be requested to make the following amendment, viz. -
In sub-item 02.06.1, leave out “ NZ: Free”, insert “ NZ: $0.017 per lb.”.
The sub-item now before us relates to bacons and hams, partly or wholly cured. At present they attract a duty of $0.033 per lb. The proposal is for free entry of these commodities from New Zealand. For the same reasons thatI advanced in regard to pork, we oppose the inclusion of this subitem in the Schedule.
Request for amendment negatived.
.- I move -
That the House of Representatives be requested to make the following amendment, viz. -
In sub-item 02.06.2, leave out the words and figures “ smoked pig meat not falling within subitem 02.06.1.”.
This sub-item deals with smoked lamb, mutton birds, and smoked pig meat not falling within sub-item 02.06.1. The proposal is for free entry of these commodities from New Zealand. We oppose the inclusion of this sub-item.
– For the reasons which were advanced when we dealt with the first request, the Government is not prepared to accept the request that is now before us.
Request for amendment negatived.
Tariff Amendment agreed to.
Tariff Amendments 3 and4 - by leave - taken together, and agreed to.
Tariff Amendment 5.
.- I move -
That the House of Representatives be requested to make the following amendment; viz. -
In sub-item 04.04.31, leave out “ NZ (A): $0.04 per lb.”.
This sub-item relates to cheddar cheese. The quantity to be imported is to be limited. In the past between 200 and 250 tons of cheese has been imported annually. Under the New Zealand-Australia Free Trade Agreement, in the first and second years the amount imported is to be limited to 400 tons, and in the third and fourth years to 800 tons. In the fifth and subsequent years covered by the period of the agreement there will be a ceiling of 1,000 tons. The present duty is$0.058 per lb., which I understand is equal to sixpence per lb. Under the new arrangement, the price will be subject to agreement between the
Australian Dairy Produce Board and the New Zealand Dairy Produce Board. The importation of 1,000 tons of cheese from New Zealand poses a problem very similar to that posed for other sections of the dairy industry.
The production of cheese is an important sideline for the dairy industry. It is well known that, in addition to the subsidy that is paid to dairymen, the manufacture of cheese provides an outlet for some of the whole milk that is not used for local consumption or for the making of butter. The importation of this increased amount will reduce the field in which our own local producers can operate. We believe that insufficient consideration was given to this section of the Australian dairy industry when the Agreement was drawn up and that it was not taken into the confidence of those who were responsible for the negotiations. At various meetings and in the Press the dairymen have stated in no uncertain terms that the terms of the Agreement can have an adverse effect on this section of the industry. It is for this reason that we move the request.
– For the same kind of reason that has already been advanced, the Government is not prepared to accept the Opposition’s request. The hit line in the consideration of this matter is the fact that beyond shadow of doubt the natural increase in the Australian consumption of cheese will absorb the proposed increase in imports of New Zealand cheese. As Senator O’Byrne has indicated, the importation of New Zealand cheddar cheese will be restricted to 400 tons in 1966 and 1967, to 800 tons in 1968 and 1969, and to 1,000 tons from 1970 onwards. The increase in the consumption of cheese in Australia between 1960 and 1965. averaged more than 1,000 tons a year.
– What is the tonnage today?
– The annual Australian production is 59,000 tons.
– What is the consumption?
Sena:or ANDERSON. - Australian exports amount to 27,000 tons a year. I presume the amount consumed here would be the difference between 59,000 tons and 27,000 tons.
– We are exporting that quantity at a loss, are we not?
– That is another side to the matter. I propose to develop this argument. As I said, there is to be a prohibition on the importation of more than 1,000 tons of New Zealand cheese. New Zealand exported some 93,000 tons of cheese to the United Kingdom in 1964-65. It is completely impossible that any change in the climate vis-a-vis the United Kingdom and New Zealand would result in Australia being the recipient of a tremendous amount of New Zealand cheese, because the Agreement provides a phasing out, wilh a restriction of imports from New Zealand cheese to 400 tons up to 1967, 800 tons up to 1969, and 1,000 tons after 1970. I do not want lo canvass this too much hut New Zealand is a tremendous cheese pro ducer and exporter. Exports of New Zealand cheese to Australia for the next 10 years will be limited to 1,000 tons a year, at the most, in a situation wherein our own national increase in cheese consumption is running at the rate of over 1,000 tons a year. I feel that in those circumstances no damage will be done. In fact, this is another item that goes to the table, with the objective of bringing a free trade situation between New Zealand and Australia. On behalf of the Government, for the reasons I have given, I cannot accept the amendment.
Question put -
That the House of Representatives be requested lo amend the Bill by leaving out the words proposed to be left out (Senator O’Byrne’s request).
The Committee divided. (The Chairman - Senator T. C. Drake-Brockman.)
Majority . . 6
Question so resolved in the negative.
Tariff Amendment agreed to.
Tariff Amendments 6 to 9 - by leavetaken together, and agreed to.
.- I move -
That the House of Representatives be requested to make the following amendment, viz. -
Leave out the Tariff Amendment.
This item refers specifically to peas and beans that are preserved by freezing, which are to be differentiated from the dehydrated peas that we shall discuss later on. The debate this afternoon ranged over a fairly wide area concerning this Amendment and the disadvantages that faced the Australian producers of frozen peas - the processors, and the growers of peas for processing by freezing. These difficulties were outlined in quite an amount of detail.It is our considered opinion that this item could quite well be discarded from the Bill and from the Agreement because a substantial industry has great fears as to its future development and continuity as a result of opening the doors to very severe competition over a period of years.
I could go back over the points that were made by various speakers during the second reading debate to substantiate the Opposition’s case for the omission of this item, but I feel that the matter has been canvassed well enough and that all honorable senators have given their minds to it to such an extent that we are now ready to vote on it.
– No duty concession.
– There would be no duty concession. I want to make two comments. First, the fact is that the duty concession would be only one-fifth of the duty. That would be a very small reduction. My second comment is that 1 base my suggestion largely on the fact that in two years we would have an opportunity to see the developments in relation to the dehydrated “ Surprise “ pea. I should imagine that it would develop very considerably during two years, with all the advantages over the frozen article that I detailed previously. Undoubtedly the marketing pattern for that particular type of pea will have become quite plain within two years. As seen by us and by those immediately interested, that pea poses one of the greatest threats. There could be a dramatic development which could lead to a great inflow of peas of that type, manufactured under the patent that is operative in New Zealand. I think the Minister’s comments, ignoring the fact that I put the case for a two years delay mainly on the basis of watching developments with the “ Surprise pea “, may have been different if he had adverted to that fact.
.- I rise to address myself briefly to the proposal to leave the item concerning peas and beans out of the Schedule, which is the substance of Senator O’Byrne’s proposed amendment. In my speech during the second reading debate this afternoon I gave reasons for my view that there is no firm basis for saying that the degree to which we propose to allow New Zealand beans and peas to come into Australia can be expected, on any practical ground, to lead to those beans and peas making significant inroads into our own pea and bean industry. I endeavoured to support my argument by an analysis of the facts relating to production here and in New Zealand, by reference to imports and the type of concession that is being given under this Agreement, and by mention of the mechanisms that are incorporated in the
Agreement for the protection of our local industry against serious injury.
While I was absent from the chamber during the remainder of the second reading debate, engaged in consideration of another Bill, Senator Turnbull from Tasmania made reference to the basis upon which my argument was offered to the Senate. I am not in this place either by the licence of Senator Turnbull or at the honorable senator’s behest. I am glad that my existence here depends very little upon any view that he holds. Indeed, 1 hope to be returned here on the smallest possible common ground with any subject of electoral appeal that will return him. I aspire to share in no degree the considerations that incline people to give him a place in this Senate. I do not think I can be plainer without being rude.
I am duty bound to advert to matters on the level on which they have been addressed to my argument. The honorable senator then adverted to the functions of this chamber. Had he been in this chamber for some 16 or 17 years, as I have - a relatively short period in a political sense - he would have seen, perhaps disappointedly, as I have, the evolution of the functions of this Senate. It would be only a political tub thumper who would take the view that a senator should regard himself as tied, whether as the monkey or the charioteer, to a particular band wagon moving in any State.
– Order! Senator Wright, I asked Senator Turnbull not to cast reflections upon other honorable senators. I think I have now allowed you to go far enough.
– I am obliged to you, Mr. Chairman. If you will permit me to suggest it, in a tedious commercial debate a little light and shade helps us all along. 1 do not resent criticism, but 1 do love to reply to it. I was saying that as a senator 1 would regard myself as a very despicable specimen if I adopted every political cause in my State simply because it would give me votes. We are members of the National Parliament and we are jealous of the fact that we have a special responsibility for State interests. Some of us are pleased to adopt, from the point of view of party identification, a political philosophy which guides us in making our decisions.
– I hope the honorable senator says that to his own party.
– J do, and to my selection committee also, as robustly as I state my views to this chamber.
– Senator Wright, I think you should come closer to the Bill.
– Yes. I was saying that the view I was offering on this item was motivated in no way by political jibes or the political interjections which came so despicably from Senator Cavanagh, who suggested that I am concerned about my position on my Party’s voting card. My Party will not determine my future.
– The honorable senator’s Party loves him as much as he loves me.
– So be it. Senator McKenna has offered a suggestion that this item should be eliminated from the Bill and that we should come to it de novo in two years. I seriously suggest to him thai his proposition would deprive us of all the advantage of the experience of that two year period. The purpose of my suggestion is to allow the proposal for the first reduction to operate: during that period the Australian industry would gear itself to the new arrangement; and New Zealand would fight for its position on our market both with the ordinary frozen pea and with the “ Surprise “ pea. With the 20 per cent, reduction of the present duty, we would have an opportunity to gauge the impact that the competition under the new arrangement could have. I believe that we would put everybody on a false basis if we completely excluded this item from the Agreement and did not test it over the first two year period. Therefore, I believe that Senator McKenna’s suggestion should not be accepted.
I was influenced by one comment that Senator Turnbull made in his speech in the second reading debate. He said that in relation to peas and beans, unlike pork and cheese, there was no quantitative upper ceiling. But, having regard to the relative production figures and the relative import figures up to date, I cannot see (hat the 20 per cent, duty reduction that occurs when the f.o.b. price falls below ls. 10id. per lb. really requires the specification of any ceiling that would be at all practicable. I rose in deference to the observations that were made by the honorable senators to whom I have referred, of course, with respect; namely Senators McKenna and Turnbull. The Senate having listened to their speeches, I felt that I should put a view in reply.
.-! wish to put a very brief question to the Minister on this matter. The Agreement provides for the phasing out of the protective tariffs over the specified period, if, after a certain period of time, it is found that the importation of peas does pose what the Government considers at that time to be a serious threat, as mentioned in the Agreement, is it intended that the level of duty applicable now should be reapplied?
– In the debate on this amendment we are dealing with frozen peas and beans. Senator O’Byrne pointed out that he had presented the main case for it in the second reading debate. In this debate, I thought with commendable restraint, he did not canvass the whole matter again. Senator McKenna entered this debate to twit me about my criticism of his proposition, which was not completely clear to me when he made his speech in the second reading debate. Me linked the dehydrated pea with this amendment and the proposition of deferment of duty reduction for two years. He said that the period of two years would give an opportunity to gauge the effect of the “ Surprise “ or dehydrated pea. I accept his explanation of the argument that he was putting, although I still do not believe that it is a valid argument.
In the second reading debate Senator Devitt raised some questions about frozen peas. One of the questions that he raised was about the marking requirements.
– I did not raise it; I answered it.
– The honorable senator asked the question and answered it himself.
– No, somebody else asked the question.
– The position is that, in terms of the Commerce (Imports) Regulations made under the Commerce (Trade Descriptions) Act, all imported foodstuffs are required to be marked to show their country of origin. Quite clearly, when foodstuffs come into the country in bulk and are then broken up, they go out of Commonwealth control and marking becomes a matter for the States. But, when goods come into the country, they have to be marked to show their country of origin at the point of entry.
– The Commonwealth would not lose power over them if they were involved in interstate trade.
– No. But the practicality of the matter, as the honorable senator would appreciate, is that a huge quantity of a commodity, such as peas, could be imported in bulk. The peas would be marked as imports from New Zealand or the United States of America, which are the main countries from which we import peas. Once they have entered the country and they start to be broken up into any number of different quantities, the matter of marking becomes one for the States.
The Australian production of frozen peas and beans in 1964-65 was 57 million lb., which was an increase of 50 per cent, on production for the previous year. T. come back to the general argument that I used in the second reading debate about the tremendous increases in production that are being achieved in Australia and the ability of Australia to absorb quite large increases in supplies of food commodities. 1 think it was Senator McManus who made a general statement which I thought was full of truth. He said that we do not have to be anxious about the consumption of Australian production because we have an expanding economy and our natural increase will enable us to absorb any possible increases in production. I point out that if the price of peas falls below 18fc per lb. the duty rises at the rate of 2c for each 3c of fall; that is to say, if the price were 15c the duty would be 2ic and if the price were 10c the duty would be 5.9c.
I also point out that on a per capita basis Australia consumes only about half the quantity of peas that New Zealand consumes. So, in the very nature of things, there should be an increase in Australian consumption. The phasing out is deferred until 1st January 1967. That gives the industry time to adjust. I think Senator Wright answered Senator McKenna’s argument on this point when he said that this phasing out period is deliberately calculated to enable the industry to absorb the reductions in duty in the normal course of development. In another place the Minister for Trade and Industry (Mr. McEwen) has pointed out that contracts between the pea growers in Tasmania and the processors have been renewed for the coming year at the same price and on approximately the same acreage.
Now I come back to what I said in my second reading speech about safeguards. There are provisions for the suspension of obligations, if necessary, and against dumping or subsidisation, and the industry may seek increased protection against imports from third countries. Senator Devitt asked what would happen in a certain situation. 1 refer him to Article 9 of the Agreement which says, in part, that a member state may suspend provisions of the Agreement “ to such extent and for such time as it considers necessary to prevent future injury to its producers “. So the Agreement contains provisions to meet that situation. In the second reading debate Senator Devitt asked one other question which I felt I should answer and which it is appropriate for me to answer now. He said that in his view there was a fear that the Agreement would open the flood gates and barriers and enable New Zealand frozen peas to come into Australia and adversely affect Australian production. He said this was the danger.
I want to point out that at present the main competition to Australian pea growers is coming from the United States of America. Our imports in 1964-65 totalled 5.3 million lb. Of that total the United States of America supplied 3.1 million lb. and New Zealand supplied 2.1 million lb. For the first nine months of 1965-66 our imports have totalled 2.3 million lb. The United States of America has supplied 1.2 million lb. of that total and New Zealand has supplied 1 million lb. As the duties on
New Zealand frozen peas are phased out, New Zealand will gain an increased advantage over United States suppliers. It should be borne in mind that the United States is the bigger supplier of frozen peas so that the competition, if it comes, will come against United States imports rather than against our own production. The duties of 12.5 cents per lb. less 66-2/3 per cent, of the f.o.b. price will still apply to imports from the United States with an f.o.b. price below 18i cents per lb. It will remain open to the Australian industry to seek additional duties on imports from the United States, if this is necessary to protect Australian pea growers. If 1 may use a colloquial expression, the punch line is that, in fact, New Zealand suppliers could double their exports of frozen peas to Australia at the expense of United States suppliers without displacing 1 lb. of locally produced peas. In other words, the introduction of a free trade area between Australia and New Zealand, if it affects the frozen pea industry, will place the New Zealand industry in a more advantageous position as against imports from the United States. I suggest that local production will not be affected. The debate in respect of frozen peas has been quite interesting. For the reasons I have stated, the Government is not prepared to accept the proposed amendment.
Question put -
That the House of Representatives be requested to amend the Bill by leaving out the words proposed to be left out (Senator O’Byrne’s request).
The Committee divided. (The Chairman - Senator T. C Drake-Brockman.)
Majority , . . . 4
Question so resolved in the negative.
Tariff Amendment agreed to.
Tariff Amendments II to 13 - by leave - taken together, and agreed to.
Tariff Amendment 14.
.- The Tariff Amendment under consideration refers to peas processed by the “ Surprise “ technique or the Unilever dehydration technique. The Amendment refers to both peas and beans and I point out to the Senate that the dehydration process is used for beans as well as peas. The presence of this provision suggests that although the process has not been exploited to any great extent, we must anticipate the development of this technique and its extension to the process ing of beans. It is because of that anticipation that the Opposition is moving for the deletion of this Amendment. The new process is one by which a pea or bean that has been grown to its most palatable stage can be dehydrated, transported without refrigeration and then, by immersion in water, can regain its previous size, appearance, flavour and so on. It is claimed that this process constitutes a threat to the future of the pea and bean growing industry in Australia. The fact that beans treated by this new process have not been imported from New Zealand does not mean that they will not be imported in the future. The samples of the dehydrated peas that have come here have met with such popular support that they have given rise to most of the concern expressed in the industry. Senator Wright and Senator Gair referred to unjustified fears, but I think that if they had seen the success which this product has met in Australia they would agree that any country where a company holds the patent rights to the process has a very big economic advantage.
I do not know whether we can negotiate an agreement with the holders of the patent in New Zealand to use the process here, or whether our scientists can improve on the technique. I hope that research officers in the Commonwealth Scientific and Industrial Research Organisation and engineers associated with the vegetable processing industry will apply their intellects and their resources to solve this problem for our primary producers. The challenge is being thrown out to them. If a period of grace, so to speak, were given, it would allow the pea and bean growing industry to take up the challenge that confronts it. It would give an opportunity for those concerned to prove that the Australian is adaptable and can seize opportunities to counteract any adverse effects on his industries. To give the industry the time we think it needs to put itself in a position to compete with this unknown element - only sample packages of the dehydrated peas have been imported and T do not think any dehydrated beans have yet come into Australia - I move -
That the House of Representatives be requested to make the following amendments, viz. -
In sub-item 07.05. 211, leave out “ NZ (A): $0.12 per Ib.”.
In sub-item 07.05. 291, leave out “ NZ (A): $0.12 per lb.”.
My next two proposed amendments will cover dehydrated peas.
– I take it that Senator O’Byrne is addressing his arguments to the two amendments he has moved and the two he has foreshadowed, so I will address my reply to the four amendments, dealing with both beans and peas. I will deal first with the subject of beans. In these amendments we are asked to amend a trade agreement between two nations - one which is tremendously important to Australia’s future. It is a history making agreement which will affect about 60 per cent, of the trade between Australia and New Zealand, making it completely duty free. We are being asked to amend the Agreement on account of some possible threat offered to Australian industry by dehydrated beans which nobody in this country has yet seen. With great respect, I do not think that is a very strong reason for amending the Agreement.
– Do not shut the stable door until after the horse has gone.
– If we were to resist every change because of some imaginary or contemplated competition, we would never write a trade agreement at all. In this instance nobody in Australia has seen the dehydrated beans that have been mentioned. I cannot pursue the argument beyond that.
Two amendments are foreshadowed, dealing with dehydrated peas, of which there has been a very limited importation from New Zealand. My understanding is that in the nine months from July of last year to March of this year dehydrated peas to the value of $8,518 were imported from New Zealand, the quantity being 7,900 lb. How can the proposed amendment be sustained on those figures? Senator O’Byrne says - Senator McKenna enlarged on the argument - that this commodity is a potential danger to the pea growing industry in Australia. That is his opinion and his judgment, but again I point out that Article 9 is included in the New Zealand-Australia Free Trade Agreement to protect the industry not only against a specific item but also against like or directly competitive products. I do not think we can sustain an argument (hat we should negate a trade agreement between Australia and New Zealand, which means so much for the future of both countries, on the ground that we believe there is some possibility of grave risk to the Australian industry from a process of dehydrating peas, which is now coming into operation. I gather that this produces the “ Surprise “ pea. This, as has been said in the debate, is a new product which Unilever Australia Pty. Ltd. has patented. The peas are pricked and then air dried. Their dry weight is about one-quarter of the original weight. They remain sound for at least 12 months without refrigeration. These are facts which Senator McKenna canvassed in his speech.
The duty on these peas was1s. 6d. a lb. prior to the Agreement. It was reduced to 1s. 2.4d. on 1st January 1966 and will be phased out over a period of eight years. Unilever Australia Pty. Ltd. advises that it is now considering the manufacture of this product in Australia and it is importing from New Zealand to test the market. It is also continuing the growing trials and pilot production in Australia. The company claims that the present market testing operation is unprofitable and would remain so, even if there were no duty payments. These points were made in a statement issued by the Minister for Trade and Industry (Mr. McEwen). This statement was made with all the weight of a responsible Minister of the Australian Parliament. He added that it is too early to get a clear indication of the likely effect of this product on the local growing and processing industry. It seems likely, however, that if it finds sufficient consumer acceptance production will be undertaken in Australia.
I think we must accept that it is a new process and that it is an unknown quantity. We must accept the mathematics that show that certain advantages flow from dehydrating peas and then blowing them up to their normal size. But conceding all the advantages, we cannot sustain an argument that we must negate a trade agreement because we think that at some time in the future, in six, seven or eight years, dehydrated peas may be a threat to frozen peas and therefore a threat to Tasmanian frozen peas.
– We could cut the excise in case somebody in the future invents dehydrated beer.
– I am always very cautious about cutting excise. The Department of Customs and Excise does not determine the rate of excise. My job as Minister and the job of my Department is to collect the excise once the rate has been determined. Therefore, I am very careful not to comment on it. Although the “ Surprise “ pea has all the elements that have been canvassed in the debate, the argument that has been advanced is not sufficiently powerful to warrant negating the Agreement, particularly as the argument deals with a possible happening in the future. If the worst fears of all honorable senators opposite were shown ultimately to be well founded, the Agreement in Article 9 would permit the necessary action to be taken.
– Is it the wish of the Committee that one vote be taken on Senator O’Byrne’s amendments? As there is no objection, that course will be followed.
Question put -
That the House of Representatives be requested to amend the Bill by leaving out the words proposed to be left out (Senator O’Byrne’s requests).
The Committee divided. (The Chairman - Senator T. C. Drake-Brockman . )
Majority . . . . 6
Question so resolved in the negative.
.- I move -
That the House of Representatives be requested to make the following amendments, viz. -
In sub-item 07.05.412, leave out “ NZ (A): $0.12 per lb.”.
In sub-item 07.05.492, leave out “NZ (A): $0.12 per lb.”.
These amendments relate to peas. When I put forward an amendment which proposed the deletion of the item relating to beans, I was told that no beans processed according to the new “ Surprise “ technique had been seen in Australia. We have seen here peas that have been subjected to this process. We all hope that eventually we will be able to process these peas and beans in Australia. We could either get the Unilever organisation to establish a factory in Australia and co-operate with the processors here so as to give security to the growers, or we could obtain the patent rights to the process. Whatever is done in that regard, there is no doubt that we all hope that the competition that the growers will inevitably face over the years will be met. I am suggesting that in this instance we give the benefit of the doubt to the growers and processors by deleting the two items mentioned in my amendments.
– I want to point out that the position which has arisen now is similar to a position that arose the other night. Both Senator O’Byrne and Senator Wright have circulated requests for amendments to sub-items. So that Senator Wright will not be precluded from moving his amendment, I propose, with the concurrence of the Committee, to put Senator O’Byrne’s requests for amendments in the form “ That the requests be agreed to “.
– I have already given the reason why the Government will not agree to the requests.
Question put -
That the requests (Senator O’Byrne’s) be agreed to.
The Committee divided. (The Chairman - Senator T. C. Drake-Brockman.)
Majority . ….. 4
Question so resolved in the negative.
.- I wish to direct the attention of the Committee to sub-item 07.05.412. This sub-item refers to peas pricked, slit or subjected to any similar process designed to facilitate dehydration and subsequent hydration. You will notice, Mr. Chairman, that this sub-item is under the heading: “Put up for retail sale.” Sub-item 07.05.492 is in similar terms under the heading “ Other “. This means that the commodity is not to be put up for retail sale but is to be sold in bulk. The requests for an amendment in respect of each of these sub-items, as they have been circulated in my name, are in a very cryptic form for the efficacy of which I owe a debt to the officers advising the Minister. To them I express my indebtedness. In the last column, each sub-item contains the notation “ NZ (A): $0.12 per lb.” The effect of the amendment that I propose to request in each instance would be to delete that notation and substitute for it another containing the same words, letters and symbols with the exception of “ (A) “.
With respect to the clauses of the Bill, this procedure would have the effect of preventing the continued phasing out of duty after the first period up to the beginning of 1968. The purpose is to give expression to the view that I submitted to the Senate this afternoon. In reference to this schedule, this will apply only to “Surprise” peas. But the principle is precisely the same as that which will be raised in respect of the first request which I have circulated and which relates to sub-section (3.) of proposed section 17a of the principal Act, which is contained in clause 6. With respect to the two sub-items that I have mentioned, as they relate to “ Surprise “ peas, my view is that this Parliament should go along with the New Zealand-Australia Free Trade Agreement to the extent of accepting it both in principle and for the initial phase so as to see how the Australian pea industry will be affected by the operation of the reduction of duty on New Zealand imports during the first phase.
I put it to the Committee that this course would have the great advantage of saying to New Zealand, in effect, that we as a Parliament accept the principle of the Agreement and that, indeed, we accept in their entirety the details relating to the first phase, but that we indicate our anxiety about the continued operation of the reduction of duty as it will affect the Australian pea industry, though we do not at this stage reject the subsequent phases with respect to that industry. We would simply reserve the Parliament’s approval of the subsequent phases. We would not prejudice the possibility of the proposal in the Agreement being carried through. As a Parliament, we would simply reserve the right to bring the subsequent phases into operation when the time comes.
May I illustrate my proposition, Mr. Chairman, by reference to sub-section (3.) of proposed section 17a. In that sub-section, paragraph (a) provides for a reduction of duty from the beginning of 1967, paragraph (b) from the beginning of 1 969, paragraph (c) from the beginning of 1971, paragraph (d) from the beginning of 1973 and paragraph (e) from the beginning of 1975. I submit that the Committee will find a great deal of reason in not at this stage assenting to the operation of provisions that are not to come into effect until 1969. 1971, 1973 and 1975.
I suggest that the proposal that I have put to the Committee meets the principles of the Agreement, that it in no way indicates repudiation, and that it would not subject the local industry to any disastrous result. It seeks to enable the Parliament to reserve the right to gear subsequent phases in the light of experience gained by 1968. I believe that it would achieve the twin aims of implementing this Agreement between the two sister dominions and of reserving to the Parliament the right to decide, in the light of experience, whether to approve implementation of reductions that are involved in subsequent phases to commence in 1969, 1971, 1973 and 1975. I move -
That the House of Representatives be requested lo make the following amendments, viz. -
In sub-item 07.05.412, leave out “ NZ (A): $0.12 per lb.”, insert “NZ: $0.12 per lb.”.
In sub-item 07.05.492, leave out “ NZ (A): $0.12 per lb.”, insert “NZ: $0.12 per lb.”.
– Is it the wish of the Committee that both amendments be considered together? There being no objection, that course will be followed.
– At the second reading stage Senator Wright foreshadowed his proposal, lt was subsequently alluded to by Senator McKenna. In my reply 1 indicated that the Government was not prepared to accept the proposal, and I advanced certain reasons. In fairness to Senator Wright, I shall repeat the point that I endeavoured lo make. The honorable senator has said, in effect, that he believes in the Agreement and in the phasing proposal, but that he has a doubt. He suggests, therefore, that we should adopt the first phase and that at the end of that period a further Customs Tariff Proposal should be introduced in the light of experience gained. On the face of it, that proposal has an attraction. But if this argument can be advanced in relation to peas and beans, what valid reason is there for not extending it to every item in the Schedule? The honorable senator has selected a particular item and has suggested that, because there is some doubt about what will happen, we should not go along with the phasing proposal.
Such an approach suggests a lack of faith in the safeguards that have been incorporated in the Agreement. I do not think we can divide our approach in this way. If one accepts the New Zealand-Australia Free Trade Agreement, one should be prepared to accept it as a whole, including the safeguards that have been written into it. One should be prepared to acknowledge that the Government, the Senate and everybody else concerned has approached the matter with a sense of responsibility. Indeed, that is why Article 9 has been written into the Agreement. I do not think there can be separation because separation would create a degree of uncertainty and deny the very argument which Senator Wright used with such force earlier, that the whole thing is set deliberately in a pattern to phase out over a period of from eight to nine years. To introduce an element of uncertainty into the phasing is to destroy the concept. Under the proposed amendments the scheme would be entered into on the basis that the duty will be reduced by one-fifth under phase 1 of the plan, but then there would be uncertainty at the end of that cycle as to what the future will hold.
The Government and I feel that, having taken the first hurdle of phasing out the duty on the basis that the industry will not be hurt in the ultimate, the process should be continued until the time is reached when free trade can be established without any disadvantage. We do not think that there should be any pause during the process. I feel that if we do pause, we run the risk of defeating what we set out to do.
By implication, the proposed amendments do not acknowledge the provisions which have been so carefully written into the Agreement to meet any situation that might arise. Further, if we pick out peas and beans, what do we do about the other items in the Schedule? By taking out these items, we hit at the very foundations of the structure of the Agreement. For those reasons, the Government is not prepared to accept the proposed amendments.
– I do not accept the argument addressed by the Minister that if this action is taken with relation to dehydrated peas then it should be applied to all the other items in the Agreement.
– It is an absurd argument.
– It is, because this case is clearly distinguishable from all the others.
– That is only a debating point.
– No. Let me put it in these terms: Here is an entirely new element being introduced into an industry. It has a highly explosive trade potential. It could smother the whole field very rapidly. Surely to goodness it is caution and wisdom to acknowledge the viewpoint that in those circumstances, in relation to the whole field, we are not setting out to gradually diminish the duties over a period of eight years until they are abolished altogether. Senator Wright’s amendment acknowledges the fact that here is a potential danger. It says to the Government: “ Here is the duty that you want for the year 1967 and the whole of 1968. In two years’ time, let us have a look at this new explosive element and then take the next step under the Agreement.” This does not constitute a breach of the Agreement. It is the first step in giving effect to it.
The three circulated amendments look a bit complicated and technical, but the truth of the matters is that it is necessary only to alter one clause in the Bill and two items in the Schedule to achieve the purpose Senator Wright desires. They do no more than confine the Government to taking only the first step in the reduction of duties at this stage. The question is as simple as that. The proposed amendments would give everybody time to survey the field. I think that the type of action which is suggested would be a real consolation to all those who are very greatly disturbed in Tasmania for they would be assured of the whole position being looked at. They would know where they stand. They would know that for two whole years the duty would be reduced by one-fifth. It is quite certain that in that time the future of the “ Surprise “ pea process will have been determined and we shall know exactly where we are going. It is far wiser not to take a leap into the dark for a period of eight years when we can step out for only two. The Opposition will strongly support the amendment. We would have liked to go further but we are happy to settle for this if we cannot get any better.
– I should like to speak briefly in support of the amendment moved by Senator Wright. To illustrate the significance of it, I point out that this industry has seen some quite dramatic changes in its history. There are many of us who will remember that earlier in the history of the industry the main type of presentation of peas was in dried form. The peas had to be soaked overnight in water with bicarbonate of soda,” which made them soft enough to be edible.
At the same time, peas were available in the shell but it was found that by the time they reached the greengrocer, because the developing process had gone on, the peas, although very edible, had deteriorated. Later, these were superseded by frozen peas. We saw a decline in the quantities of peas sold with the older style of presentation and an increase in the quantity of frozen peas. This is, I believe, the next phase and it could be a vital phase for the Australian producer. The dehydrated pea industry could supersede the recently evolved frozen pea industry. To settle for a very close review of the situation in two years is a most reasonable request and 1 believe that the Committee could well support it without altering in any way the basic principles of the Agreement. The case put up by the Minister, that it would affect other items in the Agreement, does not hold any strength for the simple reason that none of the other items is affected in such a specific way as this entirely new process. Therefore, I ask for the support of the Committee in agreeing to the amendment moved by Senator Wright.
– I could not support the amendment, because, as I read the Agreement, ability to overcome this problem within a period of 60 days exists under Article 9. I prefer to have 60 days in which to overcome the problem than to have two years, so I suggest to the Committee that the proper course is to adopt the Agreement, and realise the let out and safeguard clauses in it. I imagine that if the Tasmanian pea industry is adversely affected action will be taken under Article 9. If you are able to take action expeditiously, the remedy is in your hands in something of the order of 60 days, plus the time taken in consultation. I find it very hard to change the Agreement or to alter its terms, because I believe quite genuinely that all the necessary and real safeguards exist in the Agreement and they exist in far more effective terms and would be effective far more quickly than the terms of any amendment that I have heard proposed, including Senator Wright’s amendments, could offer.
.- It is unfortunate that Senator Cotton has intruded into the debate, because he has put before the Senate an obvious fallacy.
Article 9 of the Agreement still will operate on an administrative basis during the first two years. There is no antithesis or contrariety at all between the 60 days of the Agreement and the two years phases of the Bill. It is a complete misconception of the functions of implementing an administrative agreement and operating the law of the country to suggest that 60 days, being the briefer period of the Agreement, is preferable to the two years of the Bill. There is no reason behind that proposal whatsoever. It is unfortunate that it should be advanced; it really clouds the issue. The issue is that Parliament should exercise its judgment - as the Administration concedes that Parliament has the authority to do - against the Agreement or in fulfilment of it. I point out that my requested amendment would completely fulfil the Agreement for the first two years. It says nothing to the contrary of fulfilling it in the subsequent stages, but merely does the Parliament of Australia the credit of acknowledging that it is proper that the Parliament should make its decision on the implementation of subsequent phases in the light of knowledge gained from two years of experience and the circumstances existing when the decision operates. If parliamentarians are not prepared to treat their judgments to that degree of self-respect, then their arguments should not be expected to prevail in this chamber.
Question put -
That the House of Representatives be requested to amend the Bill by leaving out the letters, figures and words proposed to be left out (Senator Wright’s requests).
The Committee divided. (The Chairman - Senator T. C. Drake-Brockman.)
Majority . . . . 2
Question so resolved in the affirmative.
Question resolved in the affirmative.
Tariff Amendment agreed to with requests.
Tariff Amendments 15 to 245 - by leave - taken together, and agreed to.
Tariff Amendment 246.
– J want to direct attention to Tariff Amendment 246 which deals with the import of polyethylene monofil strip and rope. This matter was the subject of inquiry in 1964 by the Tariff Board and again in 1965 by the Special Advisory Authority. Even though the Board in 1964 recommended some increased tariffs the matter was referred to the Special Advisory Authority again within six months. The application to the Special Advisory Authority fell into two parts.
– Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Chairman do now leave the chair and report to the- Senate.
Question resolved in the affirmative. [The Chairman having reported accordingly] -
Hie PRESIDENT (Senator the Hon. Sir Alister McMullin). - Order! In conformity with the sessional order relating to the adjournment of the Senate, I formally put the question -
That the Senate do now adjourn.
Question resolved in the affirmative.
Senate adjourned at 11.31 p.m.
Cite as: Australia, Senate, Debates, 10 May 1966, viewed 22 October 2017, <http://historichansard.net/senate/1966/19660510_senate_25_s31/>.