Mr BRAITHWAITE (Dawson) - I speak in this adjournment debate tonight to challenge comments which have bordered on the emotional from consumer and food industry groups concerning the increase in the price of domestic sugar currently being sought by the sugar industry. Conveniently for the critics the comments are not based on the facts of the actual situation but rather they belabour the arguments of half-truths and innuendo as has been suggested by honourable members opposite. I wish to place before this House tonight certain facts in regard to this application and also to counter some of the claims made by consumer and food industry groups.

The last occasion on which an application for an increase was made based on actual costs of production was in 1967. The price set at that time was $ 198 per net titre tonne of sugar from which, after payment of Sugar Board costs for refining, the producer and miller received $ 140 per tonne. Today, after the increases of 1974, 1976 and 1977 which brought the price to $260 per net tonne of sugar, the producer and miller receive only $150 per tonne. This $10 represents an increase over the 10 years of only 7 per cent. In this period the consumer price index has increased by 134 per cent. Most of the increases have been absorbed in the additional costs of refining and freighting the product after it leaves the hands of the producer and the miller. None of the increases sought since 1967 have been based on up to date production costs. The fact is that only modest increases were sought in the facet of excellent export prices to maintain only the net return to producer and miller.

In spite of this attitude the producers' returns reduced from a figure of $140 in 1967 to a low of $126 in 1975, an actual decrease in that time of $14 per tonne. In the face of this fact I defy the Food Industry Council of Australia or the Australian Federation of Consumer Organisations to sustain the criticism of greed which they have levelled at the sugar industry. The industry has been not only conservative in previous requests for increases but also responsible. When export prices were high it imposed no application of that high export price to flow to the domestic market.

In recent years the industry has endeavoured in the face of inflation to reduce all possible costs through mechanisation. The consumer has had the benefit of this improved productivity. The industry has been accused of hiding behind the embargo barricade. The fact not mentioned is that many of the industries currently complaining have been able to hide to some extent behind tariff barriers and behind the same embargoes. This price is heavily borne by the rural industries. Also the embargo barricade has given the Commonwealth Government the right to set the domestic price of sugar, which is the only rural product for which the price is so set by the Commonwealth. The fact is that the sugar-using confectionery and soft drink industries, during this period of 10 years when the basic price of the ingredient increased by only 31 per cent, increased the price of their own finished product by 160 per cent compared with a consumer price index increase of 134 per cent. Consumers should therefore ask themselves who has been the least responsible. The answer would be the manufacturers. Consumers should ask themselves who has been receiving the benefit over the past 10 years of an item priced below production costs. The answer is the consumers themselves.

To substantiate the current increase of 3 1 per cent this Government has requested from the industry current production costs as applicable to the 1977 season. These vary substantially from area to area and are not at this stage readily available for the season just completed. From production costs for the 1976 season, with cash inputs, a reasonable return on investment capital, a moderate return for the labour of some 7,000 producers, I could justify a production cost well in excess of the amount of $23 per tonne to the producer sought by the current application. Once again it is a story of food manufacturers trying to cover up their own inadequacies and inefficiences by blaming a rural industry. In addition, the consumer has not been given the facts by those industries in order to allow him to appreciate the low cost of yet another Australian rural product. I had hoped that the sugar industry would not have to suffer in the same way as other rural industries have suffered at the hands of Australian consumers and manufacturers. The dairying, fruit and beef industries are examples at present. While the debate proceeds and no decision is made, the producers and millers are being denied $lm per week for every week of delay.