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Thursday, 18 October 1984
Page: 2007

Senator GRIMES (Minister for Social Security)(6.02) —Before we were interrupted I was speaking on these 20 primary industry Bills. I think I had answered most of the questions asked by various honourable senators. Senator Archer raised the matter of the Tasmanian wheat freight subsidy, which is of interest not only to Senator Archer but to all Tasmanian senators and members who have received delegations on the matter. Senator Archer claimed that restriction of the subsidy to costs of shipment from Geelong-Portland was bad for Tasmania because the wheat actually comes from Newcastle. What in fact happens is that high protein wheat from northern New South Wales is used by industrial wheat processors in Tasmania. It comes from northern New South Wales and is shipped from Tasmania.

One of the problems the Government faced was that, even with the subsidy being calculated on the Geelong-Portland freight price, Tasmanian buyers are still very well off. That they are still very well off can be gauged from the response of the Victorian millers, who also use the same wheat. Tasmanian buyers will still be well off as out of the total cost of shipment from Newcastle of about $ 35 per tonne, about $32 will be paid for out of the subsidy. That is, shipment from Newcastle is only $2 to $3 per tonne more than shipment from Geelong and Portland. Therefore, I suggest that important beneficiaries of the subsidy, such as Manildra Starches Pty Ltd, Associated Pulp and Paper Mills Ltd and others, will continue to have a considerable advantage over their mainland competitors. If the change had not been made it certainly would have been unfair to the Victorian buyers of Newcastle wheat who would have claimed-and one would have had difficulty in not agreeing with their claim-that they should also get a subsidy for buying Newcastle wheat as the Tasmanian buyers get it. The Victorian millers and buyers therefore demanded restrictions to the Geelong-Portland freight price as was recommended by the Industries Assistance Commission. It was for that reason that the Government took this decision.

I should indicate that the Government does not accept the amendment moved by Senator Scott. We believe that the part of the amendment relating to membership of the Australian Wheat Board has little point. We claim that the industry's concern has already been met by the amendments moved by the Minister for Primary Industry, Mr Kerin, in the House of Representatives. The original draft of the Bill contained the Minister for Primary Industry's proposals for a new structure . They were to reduce the wheat grower representation from each State from two to one as well as to appoint additional expert non-growers. Following strong grower opposition to the proposal to reduce grower representation, the Minister introduced an amendment during the Committee stage in the House of Representatives. The amendments that were moved there were supported.

Senator Haines —If you get any more enthusiastic you will have a heart attack.

Senator GRIMES —That is all right. I cannot get as enthusiastic as the honourable senator did about her trip overseas. The Minister has announced that he will ensure that a review is conducted in about May 1985. The operation of the new Board and the review will involve both the Australian Wheatgrowers Federation and State governments. The result of this review will form the basis of new legislation to be put before the Parliament by the Government to establish the AWB structure to apply from 1 October 1985.

Senator Scott also seeks to have the Wheat Finance Fund replaced as soon as possible. It is true that the Fund will not be repaid immediately. However, it will be paid within nine months as follows: About $60m will be paid as soon as the Bills go through and the remaining $100m will be paid after 1 July. I believe the reasons for these arrangements are obvious to everyone here.

As to the domestic human consumption wheat price, Senator Scott asked that in setting this price account be taken of the extra costs involved in servicing the needs of the flour millers. The amendment he has moved here is unnecessary as account has been taken of these costs in the price which the Minister has already announced for 1984-85. The price of $195.25 a tonne includes a margin of $16 a tonne above export parity, that is, above the price which the Australian Wheat Board would get if it exported the wheat, precisely to cover these costs. The price is still $23 per tonne less than the 1983 price, which should bring down the price of bread, I am assured.

I realise that there are many Bills in this package. That point has been made by many speakers on the Opposition side. I hope I have answered most of the questions raised in this long debate. I thank those honourable senators who took part in the debate and who actually spoke about the legislation. I thank honourable senators for their co-operation in this matter. I commend the Bills to the Senate.

Question put:

That the words proposed to be added (Senator Scott's amendment) be added.