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Thursday, 22 November 1973

Senator DRAKE-BROCKMAN (Western Australia) (Leader of the Country Party in the Senate) - I rise to support Senator Laucke and Senator Little. When these Budget proposals were announced the withdrawal of the sales tax exemptions on certain soft drinks brought an immediate and a strong reaction from the growers and from the industry generally. When one considers the length of time for which assistance has been given to the fruit industry under this section of sales tax exemption one can readily understand why that outcry came. We find in looking at the task force report, item 120 at page 309, that the exemption for essences consisting substantially of juices of Australian fruits had been in force since 1932. It was abolished during the war years but reintroduced in 1946, 1 take it by a Labor government. In 1957 the exemption was expanded to cover non-alcoholic carbonated beverages containing 5 per cent or more of Australian fruit juice. The purpose of the concession at that time was to assist the fruit growers and particularly citrus growers.

We found immediately that when that expanded exemption was applied the result of the concession was that soft drink manufacturers used apple juice as an ingredient to secure exemption for their products. As Senator Little pointed out, a number of these manufacturers were in the co-operative area. But apple juice, I understand, is said to be practically colourless and tasteless so that it cannot readily be detected in soft drinks. We know that from Coca Cola, ginger ale and such drinks. Senator Laucke said that this made a tremendous difference to the industry; it assisted the industry because it could use inferior grades of fruit for this purpose, and this made a vast difference to the growers' returns.

In my State the Budget came at a time when the extractors of the juices had all their vats filled to the limit. They had purchased their fruit from the growers, had extracted the juice from that fruit and were ready to meet the summer market of the drink manufacturers. Overnight a situation developed which meant that these manufacturers who had paid the growers good money for their fruit were left with this vast quantity of juice on their hands. The Country Party has studied closely the representations made by the industry, particularly by the fruit growers and the cooperatives. We believe that the amendment put forward by Senator Laucke deserves our support because we believe that this is the only way we can see the industry getting out of the situation in which it has been placed.

One has to look for a reason behind this withdrawal of the concession. I have quoted the task force which was set up by the Prime Minister (Mr Whitlam) of which Dr Coombs was Chairman. I find in this the anti-rural hand of the Prime Minister and of the Labor Party in general- in this take-away task force as I call it. Dr Coombs was asked- as country people have cause to remember well- to find economic room for the Government's higher priority programs. Frankly, I am amazed to learn that in this instance removal of the exemption was recommended and adopted without any consultation with the citrus industry, the apple industry, the pear industry or any other fruit or associated industry. It was done without any consultation at all. I have warned on many occasions of the dangers of setting up centralised advisory commissions and committees, and here is a classic example of what can happen under such a system: An important industry is to be deprived of assistance without even being asked to express an opinion on the likely effect of this action.

Senator McLaren - Did you consult the grape growing industry when you put on the wine excise?

Senator DRAKE-BROCKMAN -That was one of the most important parts of the LiberalCountry Party platform. The effects are great. Senator Laucke has spoken of them, Senator Little has spoken of them, and I am deeply concerned about the future of the industry not only in my own State of Western Australia, where it is very serious, but in Tasmania, South Australia and even New South Wales. 1 know well that the fruit industry has had a long and a hard struggle to stabilise returns to growers through its orderly marketing system. There is no doubt in my mind that the action proposed to be taken by the Government indicates its failure to understand the widespread effects of this move. I strongly support the amendment because I believe that it will give the Bill a measure of justice which is certainly sorely lacking at present. For the reasons that I have stated, for the reasons stated by Senator Laucke and Senator Little, and for the reasons that I know Senator Wright will state, the Country Party will support this amendment.

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