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Friday, 20 March 1987
Page: 1087

Senator MacGIBBON —Is the Minister for Industry, Technology and Commerce aware that the French Government has negotiated a 130 per cent offset agreement with the Boeing aircraft company for four Boeing 707 airborne warning and control aircraft, a contract valued at $US885m, about $A1.4 billion? Britain, with an order for six Boeing 707 AWACs, has also been awarded offsets to the value of 130 per cent of its contract. Can the Minister explain to the Senate why the best he and his Department can do is negotiate only 30 per cent offsets with Boeing?

Senator BUTTON —The normal offset arrangements which the Government has in place are for 30 per cent. The sad fact, however, is that the Fraser Government caved in to pressure from Boeing and reduced even that level of offsets to 10 per cent. All other offsets are at a 30 per cent level. Since we came to government my Department, particularly in the last year, has spent a lot of time trying to renegotiate the Boeing level of offsets to the level of those applying to other companies which provide offset entitlements. We will have some success with that and an announcement will be made shortly.