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Tuesday, 7 May 1985
Page: 1469

Senator JESSOP(9.05) —I have listened with great interest to the speech made by Senator Puplick who has highlighted the deficiency of the Government in its regard for the need to finance research in industry and many other areas in Australia. In speaking on this Automotive Industry Authority Amendment Bill he highlighted the importance of research into automotive design. I sympathise with what he said and totally endorse the comments that he has made.

Senator Button —That might be an error.

Senator JESSOP —I will come to the attitude of the Minister for Industry, Technology and Commerce later. He is culpable in the area of research because he has ignored totally some areas of public interest grants that I believe he ought to have recognised as a matter of urgency. I will come to that later. What Senator Puplick said was highlighted by the fact that the Minister for Science (Mr Barry Jones) was not even given a guernsey at the National Economic Summit Conference. Representatives of all the people of Australia were supposed to have been called together to give the Government future direction on the economic progress of this country. Mr Jones, with due respect to some of the deficiencies that Senator Puplick adverted to, was unable to put a view in this important forum on the need to provide some stimulus to science and technology in Australia.

At present the Senate Standing Committee on Science, Technology and the Environment is conducting an inquiry into technological development and its possible effects on employment. Some public hearings have already been held. I am not frightened of technological development. Technological development-I am sure the Minister appreciates this because he has a knowing smile on his face-does not mean unemployment. In fact, if it is wisely approached in Australia it can mean employment opportunities for people requiring jobs. I think it is a very important question with which the Government should come to grips. We had a public hearing the other day in Canberra. A Professor Ford illustrated how tardy we are in Australia. He is a professor from New South Wales interested in human resources. He has been to Japan, West Germany, Sweden and Norway in pursuit of knowledge of industrial development in those countries. He has just returned from Japan where he examined the Toyota motor plant in company with a colleague of his from the United States of America.

To illustrate how far we are behind Japan, West Germany and other countries, for example, he told us at the public hearing that the company was going to change the run on the production line. I forget the exact detail. It may have been to change it from left-hand drive vehicles to right-hand drive vehicles. The company put a lot of thought into this. Professor Ford asked his United States counterpart how long that particular change in the production line would take in America. The American expert said that it would take about eight hours or one shift. Four workers were involved in this operation. Professor Ford put the stop watch on and five minutes and 44 seconds later that production line had been changed. If such a change takes eight hours in America, how long would it take in Australia? I imagine it would take two weeks or a month in view of the attitude of some of the trade unions in this country.

Senator McIntosh —What are you talking about?

Senator JESSOP —The honourable senator from Western Australia, the import from the Scottish Isles, ought to know that one of the main reasons why Australia is lagging behind the rest of the world in respect of industrial development and technology simply is that there are too many trade unions in this country. Why are there too many trade unions in this country? There are too many trade unions because they have built up empires and bureaucracies within the trade union movement which they do not wish to relinquish. Restricting the number of unions is one of the success stories of places such as West Germany and Japan. I did not think I would be saying such things 10 or 15 years ago. I believe that having too many unions is one of the problems we have in Australia. The Toyota factory has to deal with only one trade union and it does so very effectively. When a change in technology is contemplated it consults with the trade union concerned and explains the problem. With the co-operation of the union, the factory then puts that action into effect. For example, last year in the Toyota factory no fewer than three million suggestions came from the employees on the factory floor as to how they could increase production. How many suggestions would come from the factory floor in Australia?

Senator McIntosh —One, sack you.

Senator JESSOP —Senator McIntosh said one suggestion. That would be about right. I think he is being unkind to the trade union movement in Australia because I believe there are some trade unionists in Australia who are genuinely interested in overcoming the problems that we face. I have listened to my friend from Western Australia talk about matters relating to the trade union movement over a long period. However, I believe that we have to come to grips with the problems if Australian technology is to be introduced for the benefit of Australians and with the purpose of providing jobs in Australia at present.

It is quite evident to me that the example of Japan and its system of technological development is one we could profit by in Australia. Motor vehicle production in Japan is in the order of 11 million units a year. If we look back a few years to when Japan was pressured by competition from South Korea, Taiwan and other low wage structured countries we see that Japan made decisions to change its technology. It decided to computerise production lines. That meant a reduction in the factory floor staff of 50 per cent. In respect of the motor car industry, the factories concerned consulted with the one trade union associated with that industry. The factories pointed out the need for this technological change and showed that there was a need to reduce the factory floor staff by 50 per cent. They then carefully made the point that it would not be a question of retrenchment. It was a matter of going about the problem in a rational way and explaining to the workers on the factory floor who would no longer be needed in that part of the industry that they would be retrained and fitted into other parts of the industry that would expand because of the particular technological development. That is exactly what happened. The process took three years. During that time people were retrained and their productivity increased by 30 per cent. The factories increased employment by 3 per cent. I think that is a lesson that Australia can learn.

The Minister gave one of his knowing, but I hope sympathetic, smiles when I started my speech. I know he is genuinely interested in industrial development in Australia. I pay him that dubious compliment. I believe he recognises that for years under successive governments industry in Australia has been propped up by tariff protection which, in my view, has meant that in Australia we have lost that entrepreneurial drive and spirit. This is simply because successive governments have chosen the easy way out and provided tariff protection rather than an equivalent amount of money to provide incentives for industry in Australia to become innovative, entrepreneurial and more effective and efficient as far as the world scene is concerned. Senator Puplick kindly referred to a speech which I made in respect of the computer assisted disaster management project, CADMAS, which is devised to deal with natural disaster situations, such as the Ash Wednesday bushfires, floods and so on. I notice that in the explanatory memorandum to the Bill it is stated:

Clause 9 introduces a new section 27A, similar to Section 39 of the Industrial Research and Development Incentives Act 1976, which empowers the Authority, subject to Ministerial directions, to make arrangements for the carrying out of public interest projects.

At a recent Estimates committee meeting I asked why CADMAS was not funded under the public interest grant section of the Act. The departmental officers said that it was because CADMAS did not comply. I believe that the department concerned attempted to answer the question. However, I ask: What could be of more public interest than a centralised computer system dealing with natural disasters, such as the Ash Wednesday bushfires? I think the Minister has been culpable in this matter because it is clearly within his power to say to those bureaucrats: 'CADMAS is in the public interest and ought to be funded'. However, because of his indecision and, I suggest, his incompetence, this project has been delayed for around two or three years. Of course, what will happen is that the company involved in the development of this very important public interest project will have to derive financial assistance from the United States of America. Already a company has provided in the order of $2m for this project. Unless the Government recognises the need to give these sorts of projects some support, that company will move to the United States of America, to the detriment of industrial development in this country. I could go on for a long period reminding the Minister of such situations. He still has that knowing smirk on his face and is still chewing the end of his spectacles, contemplating what we will say and how he will reply to my charges of total negligence and lack of interest with respect to matters of public interest.

Senator Button —I would wait and see, if I were you, how I am going to reply.

Senator JESSOP —I hope that the Minister will respond. I really believe that the Minister does have some smattering of interest in developing technology in this country. I do believe-he is scratching his head, again thinking about what he will say-that he will respond positively to my charge that he has been negligent. I hope he will say that he has made a decision about the question of a public interest grant to this company. I could mention innumerable cases in relation to negligence on the part of previous governments. I accuse the previous Government of which I was a member of the same negligence. I think Australians are rather complacent about what was our comfortable situation until the present Government took office. Now we are not feeling very comfortable. I talked to some people today who are contemplating a visit to London and it will cost them dearly because of the Australian dollar's abysmal rate of exchange. Clearly, one of the matters that probably contribute to that exchange rate is the subject we are discussing at present-the neglect of technological research support in Australia.

Another project that comes to mind is an oxygen probe that was developed in South Australia at the Flinders University. This particular probe would enable, for example, the aluminium industry to save about 20 per cent or 30 per cent in electricity charges because of the injection of oxygen into the furnaces required in that industry. We have failed to come to grips with that particular technology. I am glad that the Minister wisely nods, because unless he takes some action in this area that particular technology will go overseas. Australians are very good at initial research, but regrettably we are very slow to provide the government incentive to develop those initiatives. Quite frequently we find that the initiatives are taken up by overseas companies and the export income that could be derived from those initiatives is lost to Australia. Surely the Minister, who now has a slightly different look on his face because he is obviously interested in this area, must be concerned about the disastrous situation in which we find ourselves in Australia at present. We noted when the last Budget was brought down that $5.9 billion of taxpayers' money was being spent in servicing public loans. Therefore, what we are talking about tonight is not necessarily totally applicable to the motor car industry. It also applies to other industries in Australia which desperately need the encouragement of the Minister and his sympathy with respect to public interest grants.

I suggest that the Minister may have been snowed by his Department in relation to the matters to which I have referred. I have some faith in the Minister's interest in technological progress in Australia and the need to stimulate and encourage Australian industry to take not only the necessary developmental steps but also the entrepreneurial drive that is needed to sell our products on the international market. I know that the Minister wants me to wind up.

Senator Button —I suggested a new gesture to be included in Hansard.

Senator JESSOP —The Minister is encouraging me to give the Government a little more of the medicine that it needs. When we consider the Japanese example, the West German example, which is not quite as efficient as the Japanese example, the Swedish example and the Norwegian example of technology encouragement, I think Australia can learn a lot and profit from the lessons that have been learned or the examples of the effective management overseas. Too often Australia follows blindly and copies the mistakes that have been made overseas. I think that the matter we are dealing with tonight and the encouragement that flows from the suggestions that have come from this side of the chamber, give the Minister the opportunity to do something about the encouragement of technological development by providing public interest grants, research grants, that will create jobs for Australians and export markets for Australia. In doing so, I believe that the Government will profit in the long term by reducing our disastrous balance of payments situation and doing something to reduce the interest that we in Australia are paying on public borrowings.