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Wednesday, 21 October 1931

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That is so. When the banks agreed to provide the money, the Commonwealth Bank was good enough to suggest a basis by which provision could be made to cover all wheat produced in Australia. This measure is based upon the scheme suggested by the Commonwealth Bank.

Mr Hill - The Commonwealth Bank scheme provided for a price limit of 3s.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - I am speaking of the general principle on which the allocation will be made. Later, I shall come to the point raised by the honorable member. It was satisfactory that the conference was able to arrive at a determination which eliminates any disagreement among the exporting States. The conference then began to consider the altered position resulting from the increased price of wheat. When the Premiers Conference resolved to ask for an advance of £3,000,000, wheat was quoted at about 2s. 2d. per bushel. Representatives who were at the Premiers Conference were also present at the last conference to which I have referred, and they declared that this bill was necessary, despite the increase in the price of wheat.

Mr Prowse - Probably the suggestion of the bounty has increased the price of wheat.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - Perhaps it has had something to do with it. It is still considered that this £3,000,000 and the 6d. a bushel bounty are necessary to rehabilitate the wheat industry. The price of 3s. a bushel was originally fixed merely to have a limit. After considering the matter from every angle, the conference considered that while it was undesirable to have any limitation in price, it still desired to provide a scheme that would overcome all objections, and passed a resolution asking the Commonwealth Bank to approach the associated banks to extend the limit from 3s. to 3s. 6d. a bushel. I informed the conference that the Government was agreeable to the proposal. The Prime Minister has since communicated with the banks, which are considering the matter. There were persons at the conference who have been engaged in wheat growing for many years, and among them there was a great difference of opinion, as to whether wheat would maintain its present price. It was believed that exchange and other influences might bring about a fall in price. The consensus of opinion was that this bill is necessary, irrespective of the decision of the banks as to a 3s. or 3s. 6d. limit.

Mr Gregory - Even at 3s. 6d. production does not pay.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That was pointed out by persons who have been in the industry all their lives. It was pointed out that the 3s. 6d. limit was not suggested because it was thought that it would cover the cost of production. In this matter we have also to remember the difficult times through which/ the wheat-growers of Australia have passed during recent years; for last season's crop they had to accept a price which was far below the cost of production.

In view of all these circumstances, theconference decided to ask the banks to raise the limit to 3s. 6d. a bushel. The bill, however, does not provide for any stipulated payment, the reason being that the banks have not yet come to a decision in the matter. The amount to be paid will be dealt with by regulation.

Mr Fenton - The banks will probably not reply until they know the state of the -market.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - The Government expects to receive a reply from the banks this week.

Although the bill is largely of a machinery nature, it contains one or two provisions to which I desire to direct attention. A bounty, equal to the difference between the limit agreed to by the banks and the actual f.o.b. price, will be paid on all wheat exported, with a proviso that the bounty shall, in no case, exceed 6d. a bushel.

Mr Gibbons - How will the f.o.b. price be established?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That is a matter which can best be dealt with in committee. Every care will be taken in regard to that matter. Merchants, pools, millers, and others who handle wheat, and desire to operate under the scheme, will be compelled to obtain a licence by the terms of which .they will be required to give to each grower from whom they purchase wheat a certificate setting out the purchase price on a f.o.b. basis. That certificate will entitle the grower to collect - the bounty from the bank. For instance if a merchant buys wheat at 2s. 6d. a bushel, he will give the grower 2s. 6d., together with a coupon, which the grower will be able to exchange at the bank for 6d., thus making his total receipts 3s. a bushel. Whatever the price of wheat, the bounty is to be limited to 6d.

Mr Hill - Does the bill provide for a bounty of 6d. a bushel to be paid on all the wheat which is exported ?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - Yes. The bounty will be determined by the f.o.b. equivalent; but it is not to exceed 6d. a bushel.

Mr Hawker - Does the bill apply to all wheat grown this year?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - It applies to the 1931-32 crop.

Mr Gregory - Will not the f . o.b. price have to be prescribed from time to time?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That is a matter for attention in committee. Honorable members will realize the advantage to wheat-growers of the provision that coupons may be cashed at the bank immediately the wheat has been sold.

Mr Paterson - Is there not a possibility of collusion between the buyer and the seller of wheat? Will it not be possible for them to agree for wheat to be sold at less than its value, in order to receive a larger bounty?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That possibility has been considered. It is thought that the bill has been so drafted as to reduce the possibility of fraud to a minimum.

The bill also provides that the licensee must pay into the bank an amount equal to the bounty on all the wheat sold for local consumption. That is necessary to recoup the bank for the bounty paid by it on the wheat sold for local consumption.

Mr Hill - What amount will be paid ?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - An amount equivalent to the bounty. At the conference held last Friday it was at first suggested that a flat rate of 6d. a bushel should be paid in; but, after consideration, it was decided to limit the payment to the amount of the bounty payableon the wheat which is exported. For constitutional reasons a separate bill will be necessary to deal with the amount to be paid into the bank.

Mr Latham - Will the Minister circulate that bill forthwith?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - It will be circulated as soon as it is received from the printer.

Mr Hill - There will be no need for that further bill if that now before us provides for a bounty on all the wheat exported.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - In order to overcome constitutional difficulties the Crown Law authorities consider that a separate bill is necessary. Advices received by the Government indicate that the first deliveries of the new season's wheat will be made next week.

Mr Gabb - Wheat is already being delivered in South Australia.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - I had intended to hold back the bill for a day or two, but knowing that deliveries of wheat were about to be made, and that honorable members generally were desirous of assisting the wheat-growers, I decided to introduce it without delay.

Mr Hawker - Will this season's wheat which has already been delivered come within the scope of the bill?

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - That matter will be looked into.

Mr Latham - An amendment of this legislation will be necessary to meet such cases.

Mr PARKER MOLONEY (HUME, NEW SOUTH WALES) - It is estimated that this year 126,000,000 bushels of wheat will be available for export, and that about 31,000,000 bushels will be consumed locally. On the basis of the prices at present ruling for wheat, and assuming that the banks will agree to a limit of 3s. a bushel, wheat-growers are practically assured of 3s. a. bushel. Should the limit be increased to 3s. 6d. a bushel they may receive an additional 6d. a bushel.

Several attempts have been made by the Government to assist the wheatgrowers, but owing to circumstances over which it had no control, they have been unsuccessful. In the hope that this bill will give the wheat-growers of Australia some relief, I commend it to the House, and trust that it will have a speedy passage.

Debate (on motion by Mr. Latham) adjourned.

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