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Wednesday, 28 April 1965

Senator ANDERSON (New South Wales) (Minister for Customs and Excise) . - in reply - Senator O'Byrne who led for the Opposition in this debate gave general approval to the proposed amendments of the schedules to the Customs Tariff 1933-64. He dealt with the various items mentioned in the schedules. The First Schedule relates to ginger and ginger oil, dental chairs and units, narrow woven fabrics and adjustable shoulder straps. The Second Schedule deals with emery stones, oilstones and whetstones, processed continuous filament man-made fibre yarns, butadiene and styrene butadiene synthetic rubber. The Third Schedule deals with shotguns and parts.

In general terms Senator O'Byrne expressed approval and concurrence, on behalf of the Opposition, with the legislative proposition with which we are dealing which is, after all, an enactment of the Government's decision to accept Tariff Board findings. The honorable senator did indicate, on behalf of the Opposition, an intention to move an amendment in connection with processed continuous filament man-made fibre yarns. I would like to refer to that matter in a moment or two.

Senator Benn,whilst not specifically dealing with the items mentioned in the Bill, nevertheless referred to the function of the

Tariff Board. He, along with Senator O'Byrne, paid a compliment in recognition of the tremendous job that the Tariff Board and the Special Advisory Authority are doing in this particular field. As Minister for Customs and Excise, and because I am in a sense partly associated with this legislative responsibility, I thank them for the sentiments they expressed.

The whole of the critical references made by Senator O'Byrne related to the processed continuous filament man-made fibre yarns. He suggested that the Tariff Board was tentative and had perhaps fallen into error in its treatment of this particular matter. He attempted to draw a comparison between raw yarn and processed continuous filament man-made fibre yarns. But although he read from the Tariff Board's report the paragraph at the bottom of page 11 I do not think he got the full grasp of what the Board actually said. T think I should repeat that paragraph in rebuttal of his statement. The Board stated -

The Board considers that the processing of continuous filament yarns in Australia is a worthwhile industry which would warrant assistance if such were necesary and could be afforded at reasonable cost. The local producers are, however, in no immediate need of assistance . . .

I pause there to say that, after all, it is the function of the Tariff Board to decide that. If the Board is satisfied that an industry is not in need of immediate assistance surely it must, according to its charter and sense of responsibility, in its report to Parliament, have some regard for that fact. It is the critical factor in the making of the Board's recommendation in relation to duty. I think the words I have read are the most operative words in the entire report. I will repeat them -

The local producers are, however, in no immediate need of assistance and the Board is unable to assess their possible future needs.

Senator O'Byrnereferred to that section of the report. The report continued -

It notes that provisions exist for urgent action which could be used to counter a sudden adverse change in the position of the Australian industry.

This, of course, is the whole substance of the difference that we may have in the approach to this particular debate. There is a Special Advisory Authority to meet these special circumstances. The Tariff Board fixes a duty in relation to the position as it finds it, as it very properly must do, conscious all the time - and indeed the

Board states this in its report - that there is machinery that this Government has subscribed to, and which the Opposition can support, by which the Authority is able to give short term immediate remedial assistance pending the Board again investigating the matter. I just want to point out to the honorable senator that that, in fact, is what has happened.

Senator O'Byrneindicated that the Opposition would move an amendment for the deletion of this particular item during the committee stages. I would remind the honorable senator with great respect that such an amendment would be completely pointless. The facts are that at the present time there is a duty imposed on the recommendation of the Special Authority and there is a reference of the matter to the Tariff Board.

So that the Senate may perhaps avoid a more lengthy discussion during the Committee stage I will give the historical sequence of events relating to this matter. Senator O'Byrne pointed out that the Tariff Board was in some difficulty with this question because of the changing scene. That is true. It is a fact that this particular industry has been the subject of sudden change. It is a fact that the Special Authority, on two occasions, has stepped in at the request of the industry, and in response to instructions from the Minister for Trade and Industry (Mr. McEwen), and has considered the matter as at that moment. After consideration the Authority has introduced a special duty and then referred the question to the Tariff Board for further examination. The position, as I understand it, is that on processed continuous filament man-made fibre yarns the British preferential tariff was nil and the rate for the most favoured nation was 12* per cent. In June 1963 the Authority, having considered the matter following instructions from the Minister for Trade and Industry, recommended a duty of 25 per cent, across the board. The question was then referred to the Tariff Board. The Tariff Board report, as honorable senators know, was tabled on 12th November, 1964. That report has been referred to by both Senator O'Byrne and myself. The Tariff Board, considering the circumstances in which it took evidence - and I think evidence was supplied by four different firms - immediately came to the conclusion which I have already quoted: There was no immediate need of assistance to the industry. Therefore it recommended that there be no assistance. Consequently, following the Tariff Board's report, the special duty of 25 per cent, was removed in November last. In any case, the duty would have been removed, as honorable senators would appreciate, in the period of three months from the date the Government received the report. However, the duty was taken off on 1 3th November.

I feel that perhaps Senator O'Byrne is not completely up to the moment on this matter. That is not a criticism of the honorable senator because only last week there was a reference once again to the Special Advisory Authority. That was a reference regarding both raw and processed yarn, made on 19th March this year, which is not very long ago. On 23 rd April, following the report from the Special Advisory Authority, a special duty of 2s. 6d. per lb. was again imposed. The matter has now been referred to the Board as a general reference in relation to both raw and processed yarns. It would, therefore, be completely pointless for Senator O'Byrne to move his proposed amendment to delete this item in the Second Schedule. The 25 per cent, duty was removed in November of last year; there has been a reference to the Special Advisory Authority; the Authority has agreed that there is a need for a short term special duty - a holding duty, shall we say - and a holding duty of 2s. 6d. per lb. has been imposed and is now in force. The whole matter is now before the Tariff Board for further inquiry.

Senator O'Byrne - What would be the percentage of the duty?

Senator ANDERSON - If the price were 10s. per lb. the duty would be 25 per cent. I think the ruling price is between Ils. and 12s. per lb., so the duty would be between 20 per cent, and 25 per cent. That is my understanding of the matter at present. I do not want to inhibit the honorable senator in the debate, but there is now no purpose in the proposed amendment. I repeat that the 25 per cent, duty was removed following the Tariff Board report to which he referred. The reasons were given by the Board and the honorable senator was fair enough to read them out. Subsequently a new situation arose, an emergency was considered to exist and a holding duty of 2s. 6d. per lb. was imposed only last week. These events are so recent that it is perhaps understandable that the honorable senator is not informed on them. As I have said, the question has now been referred to the Tariff Board for consideration.

There is only one other matter to which I shall refer. I think the honorable senator tried to draw some distinction between the raw material and the processed yarn. However, he did not press the argument and at this stage I do not think I need follow it through. The position is that there has been no special protective duty. The \2i per cent, duty, which has existed for a long time, remains. It is true that there has been anti-dumping intervention but, as the honorable senator appreciates, that has nothing to do with the actual rate of the tariff.

I thank Senator O'Byrne and Senator Benn for their approach to this debate. This field is complex and I must say that in the short time available to him Senator O'Byrne has been able to grasp all the elements of it. It is understandable that he was perhaps not advised of the imposition of the holding duty by the Special Advisory Authority, because it was imposed only about a week ago.

Question resolved in the affirmative.

Bill read a second time.

In Committee.

The Bill.

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