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Monday, 10 October 1994
Page: 1306

Senator SPINDLER —My question is directed to the Minister for Trade, Senator McMullan. I refer to the good fortune of American citrus growers who continue to enjoy between 40 and 47 per cent protection against Brazilian orange juice concentrate while Australia, according to the government, must dismantle its sales tax concession for local content. Why did the government cut Australian tariff protection against imported fruit juice concentrates to the ridiculously low level of 10 per cent, reducing further to five per cent, when it must have been aware that the Uruguay Round of GATT would demolish protection through the sales tax system? Secondly, what does the government intend to do to help the Australian citrus industry remain viable now that its complete lack of foresight has put our growers at risk?

Senator McMULLAN —It is rather sad. The Australian Democrats were starting to establish a little credibility around the place for putting forward economically coherent proposals; now they are back to their bad old ways. In fact, they were starting to take the place of this useless lot opposite as the people who articulated alternative economic positions. But here we have them going back to their bad old days—getting their facts confused and using that jumble of facts as a launching pad for a series of unrelated assertions that are counterproductive.

  Firstly, I want to put some facts on the table and then point out some of the contradictions. The General Agreement on Tariffs and Trade is exactly that: an agreement. We cannot impose it on other people. We all have to agree. It is not an Australian edict that we tell everybody else what they have to do; it is an agreement. That agreement distinguishes between tariff—that is, border protection measures which say that things cannot come in—and discrimination within countries; what is called national treatment.

  A product brought into a country must be treated the same irrespective of its country of origin. Australia is a great beneficiary of that rule—including our citrus growers, who export about $84 million around the world. We protest when other people around the world discriminate against our products. We cannot have it both ways. We cannot go around the world protesting about discrimination against us and then seek to discriminate against others. We cannot have it both ways.

Senator Kernot —America does.

Senator McMULLAN —No, it does not. It has tariff protection. I want to come to the Democrats' view about tariff protection in a moment. Firstly, I am trying to distinguish between those two principles.

  I want to put forward a fact in response to Senator Spindler's third point before I come back to the Democrats' view about advocacy of higher tariffs. The government will shortly respond to an important report by the horticultural task force. In that response we will determine what measures we will take to improve the international competitiveness of the citrus industry in response to the matters that have arisen under GATT and other measures.

  I want to explain to the Democrats a bit of basic arithmetic. It does not make sense to pose here as opponents of indirect tax and advocates of tariffs. A tariff on orange juice puts up the price of orange juice. The Democrats are opposed to indirect taxes because they put up the price of essentials. They spent the whole of the last election purporting to agree with us that they do not like indirect taxes because they put up the price of basic essentials. But here they are wanting higher tariffs on orange juice and higher tariffs on clothes, which will mean that the price of food and clothing will be more expensive. They cannot at the same time credibly hold both those positions. It is in fact against the interest of the Australian primary producers to do it, and they do not want it done. It is against the interest of Australian consumers, and they do not want it done. It is just another part of the myth.

Senator Kernot —What price is orange juice going to be?

Senator McMULLAN —The Democrats are going to make orange juice more expensive. They do not like the tariffs coming down, and that is what will put up the price. I read Senator Kernot's confused speech. Reiterating it here will not make it make any more sense. We will be giving consideration to the report in determining how we might best deal with this matter, but it will not be by putting up the price of orange juice by increasing tariffs.

Senator SPINDLER —Mr Deputy President, I ask a supplementary question. The minister says that we all benefit tremendously through GATT. That is fine. But why should the citrus growers pay the price? If we are going to benefit to the tune of $4 billion, out of which the government is going to derive considerable revenue, there should be sufficient funds available to assist the citrus industry. The minister has not answered the last part of my question. What is he going to do specifically to assist Australian citrus growers?

Senator McMULLAN —I appreciate that Senator Spindler likes asking questions and not listening to answers, because I specifically referred to that part of his question. There has been a report from the horticultural task force on these and other matters. That report will go to cabinet shortly and we will announce the policy that flows from it.

Senator Gareth Evans —Mr Deputy President, I ask that further questions be placed on the Notice Paper.