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Thursday, 2 April 1987
Page: 1970

Mr EWEN CAMERON(1.45) —In recent times we have heard a great many speeches in this place concerning the extreme difficulties being experienced by farmers, their families, people living in rural towns and the small business people in those towns throughout Australia. I intend to reiterate some of the arguments already put before this House. I believe that there is an urgent need to continue hammering away at the Hawke Government on this subject. This Government must come to realise that rural Australia is facing its greatest economic threat since the Great Depression in the early 1930s. High interest rates, inflation, fuel taxes, work practices which affect productivity, government taxes and regulations and an unsympathetic interference in farmers' day to day lives are but a few of the ever-mounting problems facing people who live in rural areas throughout Australia today.

There is a rapidly spreading sense of despair amongst these people and, while it is wrong to generalise that all are in financial difficulties, it is fair enough to say that more and more are reaching the end of their tether. A great many are wondering when they will be caught up in the morass if things go on as they are at present. High interest rates and inflation are probably the two greatest problems faced by people living in rural areas today. The seemingly never-ending, crippling interest rates ruling right across the board are bringing many people to their knees. There are countless numbers of people in all walks of life who do not know how they are going to meet their interest commitments. Those involved in farming have a particularly serious problem because of their low incomes. In fact, more and more face the prospect of walking off their farms.

It is all very well for members of the Hawke Government to say that the present number walking off farms is relatively small, but I maintain that the potential for this to happen is nothing short of disastrous. It is high time the Government followed the advice of the honourable member for Gwydir (Mr Hunt), the Opposition shadow Minister for Primary Industry, who put forward the following proposition on behalf of the Liberal-National Party coalition. He called on the Government to conduct a debt crisis strategy meeting between the banks, representatives of State adjustment agencies, farm leaders and the relevant Ministers for rural adjustment boards. The Minister for Primary Industry (Mr Kerin) has refused to do this so far, probably because it would be seen as an admission of the failure of Government fiscal policies.

Farmers and their families throughout Australia are feeling threatened. Farming is, of course, a great way of life. Although it requires a large capital investment to become involved, most farmers are used to receiving a small or non-existent return on their capital investment. The story goes that a farmer who won $1m in Tattslotto decided to remain farming until his prize money ran out. This, of course, is but a story. However, it symbolises the feeling throughout the Australian farming community today.

Interest rates may not be a direct cost to all farmers but they are certainly an indirect cost. Most people involved in servicing the farmer, such as agents, manufacturers, service industries, wholesalers and retailers, have an interest problem which is automatically passed on to the farmer. Inflation, which is a direct result of government fiscal policies, goes hand in hand with high interest rates in creating unusually severe problems for the rural community. The Australian inflation rate of around 9.8 per cent is four times the average of the Organisation for Economic Co-operation and Development countries. It also compares very badly with the zero inflation rate of Japan, our major trading competitor.

The Prime Minister (Mr Hawke), the Treasurer (Mr Keating), the Minister for Primary Industry and any other Government Minister honourable members may care to ask continually blame overseas prices for our commodities as the cause of our economic problems. Surely the high cost of production of these products brought about by high interest rates, high inflation rates, high freight rates, ridiculous work practices and industrial disputation, high taxes-particularly on fuel-and stifling government regulations must come into consideration when we talk about our capacity to compete overseas.

Most of these major problem areas are directly affected by government expenditure. The Hawke Government will go down in history as one of the greatest spending Australian governments of all time. Since coming to power in 1983 it has spent nearly $24 billion more than it has collected in taxes during that period-$24,000m which we really did not have to spend. This amounts to approximately $6,000 for the average Australian family. When this is considered in the light of the Hawke Government being the highest taxing peacetime government in Australia's history, it is quite obvious why our costs of production are so high and so often uncompetitive against overseas trading nations. Work practices and industrial disputation add further to our high cost of production. Some of our work practices are unique throughout the world. I refer to such things as four weeks annual leave and a 17.5 per cent loading on holiday pay, to make up for lost overtime while on holiday. This practice is unheard of in other countries, countries which are fiercely competing with our vital markets. Penalty rates ranging from time and a half to double time may not be unique to Australia, but they are industrial madness while we are facing the greatest economic crisis since the Great Depression.

All of these practices affect the farmer, if not directly, then indirectly. The big difference between the farmer and others who make a living through industry or commerce is that he rarely has the capacity to pass on these heavy costs. The Australian farmer is dependent on exporting 70 per cent of his production to overseas markets, where he competes against low production cost competitors. He really is being placed in a quite impossible position with a frightening future facing him in the near future.

I join the Opposition shadow Minister for Primary Industry in the call he made on the Government to launch a three-pronged approach to the farm problem. He called, firstly, for immediate action to remove tariffs on all farm machinery, spare parts and chemicals or, if not the removal of these tariffs, at least their replacement with bounties. In addition he called for an immediate reduction in excise on fuel. He called, secondly, for the allocation of additional funds to the rural assistance boards to meet the growing need for debt adjustment and interest relief for those farmers who are in trouble but have some hope of recovery. Thirdly, he called for the re-establishment of the farm development loan fund from an allocation of funds from the statutory reserve deposits to provide long term concessional fixed interest rate loans.

This suggested three-pronged approach has great merit and I congratulate the shadow Minister on coming forward with his sensible proposal. We can now only wonder whether the Government will swallow its pride and implement these proposals or something similar in an endeavour to take some meaningful action to alleviate problems now being faced by the farming community.